You are on page 1of 16

7+()2*2)3($&( 7+(0,/,7$5<',0(16,2162)7+(&21&(572)(8523(

'DQLHO0RUDQ

-XQH

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

LL

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

5,&+$5'+:,7+(563221 &RORQHO86$UP\ 'LUHFWRU6WUDWHJLF6WXGLHV,QVWLWXWH

LLL

LY

%,2*5$3+,&$/6.(7&+2)7+($87+25 '$1,(/025$13K'WHDFKHVLQWKH'HSDUWPHQWRI1DWLRQDO6HFXULW\$IIDLUVDWWKH 1DYDO3RVWJUDGXDWH6FKRRO3UHYLRXVO\KHZDVDPHPEHURIWKH6FKRRORI+LVWRULFDO 6WXGLHVDWWKH,QVWLWXWHIRU$GYDQFHG6WXG\DQGD9LVLWLQJ3URIHVVRURI6WUDWHJ\DWWKH 861DYDO:DU&ROOHJH3URIHVVRU0RUDQLVWKHDXWKRURUHGLWRURIDQXPEHURIZRUNVRQ WKHKLVWRU\RIZDUDQGSROLWLFVLQ(XURSH0RVWUHFHQWO\DORQJZLWK3HWHU3DUHWKH FRHGLWHGDQ(QJOLVKHGLWLRQRI&DUOYRQ&ODXVHZLW]V+LVWRULFDODQG3ROLWLFDO:ULWLQJV 3ULQFHWRQ 

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

1DSROHRQLF:DUVZHUHLPSRUWDQWLQFHQWLYHVWRNHHSWKHSHDFHGXULQJWKH&RQFHUWVHDUO\ GHFDGHVZKHQPLOLWDU\VSHQGLQJZDVTXLWHORZE\KLVWRULFDOVWDQGDUGV/DWHURQKRZHYHU PLOLWDU\EXGJHWVURVHDQGIHOOLQIDPLOLDUSDWWHUQVJRLQJXSLQUHVSRQVHWRSHUFHLYHG WKUHDWVDQGGHPDQGVIRUPRGHUQL]DWLRQDQGIDOOLQJDJDLQZKHQWKHVHVRUWVRISUHVVXUHV HDVHGXVXDOO\LQWKHDIWHUPDWKRIZDUV ,QEURDGHUWHUPVKRZHYHURQHPLJKWZHOODUJXHWKDWWKH&RQFHUWDFWXDOO\ LQDXJXUDWHGZKDWZHPHDQE\OHDQ\HDUVDWOHDVWLQ(XURSHWKDWLVSHULRGVZKHQ PLOLWDU\VSHQGLQJZDVUHVWUDLQHGQRWE\SRYHUW\EXWE\SROLWLFDOFRPSHWLWLRQIRUDOLPLWHG VKDUHRIJRYHUQPHQWDODQGVRFLDOUHVRXUFHV*RYHUQPHQWDVVXFKH[SDQGHGIDUPRUH UDSLGO\WKDQPLOLWDU\EXGJHWVRYHUWKHFRXUVHRIWKHWKFHQWXU\DQGVRGLGQRQPLOLWDU\ GHPDQGVXSRQWKHSXEOLFSXUVH0LOLWDU\EXGJHWVDQGPLOLWDU\VWUDWHJ\DOVREHFDPH LQFUHDVLQJO\RSHQWRSXEOLFVFUXWLQ\DQGSROLWLFDOGHEDWH,WLVWKXVQRVXUSULVHWKDWWKH &RQFHUWVKLVWRU\LQFOXGHVWZRRIWKHPRVWIDPRXVFLYLOPLOLWDU\FULVHVRIDOOWLPHWKH UHIXVDORIWKH3UXVVLDQ'LHWLQWRSDVVDQ\PLOLWDU\EXGJHWDWDOOZKLFKOHGWR %LVPDUFNVDSSRLQWPHQWDV0LQLVWHU3UHVLGHQWDQGLQGLUHFWO\WRWKHIRUFLEOHFUHDWLRQRID XQLILHG*HUPDQ\DQGWKH'UH\IXV$IIDLURIWKHVZKRVHGHPRUDOL]LQJHIIHFWVZHUH VWLOOIHOWLQWKH)UHQFKDUP\ZKHQWKH)LUVW:RUOG:DUEHJDQ 7KHVHVRUWVRISROLWLFDODQGEXGJHWDU\FRQIOLFWVZHUHDQLPSRUWDQWIHDWXUHRIWKH &RQFHUWVKLVWRU\IURPDVWUDWHJLFSRLQWRIYLHZEHFDXVHLQWKHH\HVRIPLOLWDU\ SURIHVVLRQDOVWKH\UHSUHVHQWHGWKUHDWVWRWKHLUDELOLW\WRFRQWUROWKHVLQHZVRIZDU$QG FRQWUROZDVDOZD\VWKHSULPDU\LVVXH7KHUHZDVQHYHUDPRPHQWWKURXJKRXWWKHHQWLUH SHULRGZKHQDQ\(XURSHDQVWDWHZDVDVPLOLWDULO\VWURQJDVLWVVRFLDODQGHFRQRPLF UHVRXUFHVZRXOGKDYHSHUPLWWHGZKLFKZDVYHU\PXFKWKHZD\PLOLWDU\SURIHVVLRQDOV ZDQWHGLW 7KHJRDOVRIWKH&RQFHUWZHUHWRVXSSUHVVUHYROXWLRQDQGWRDYRLGJHQHUDOZDU 1HLWKHURIWKHVHZHUHH[FOXVLYHO\PLOLWDU\SUREOHPVEXWERWKKDGLPSRUWDQWPLOLWDU\ GLPHQVLRQV,WZDVDOVRPDLQO\LQWKHPLOLWDU\DUHQDWKDWWKHWZRPLVVLRQVFRQYHUJHG:DU DQGUHYROXWLRQZHUHXQGHUVWRRGWREHFORVHO\OLQNHGQRWMXVWLQWKHVHQVHWKDWWKH\ VRPHWLPHVRFFXUUHGWRJHWKHUEXWLQWKHPRUHFRPSOLFDWHGVHQVHWKDWWKHIDUUHDFKLQJ PRELOL]DWLRQRIVRFLDOHQHUJ\DFKLHYHGE\WKH)UHQFK5HYROXWLRQKDGRSHQHGPLOLWDU\ SRVVLELOLWLHVWKDWZHUHUHJDUGHGDVGDQJHURXVRUHYHQIDWDOLQWKHPVHOYHV(XURSHDQVZKR KDGVXUYLYHGWKH5HYROXWLRQDU\HUDWKRXJKWWKH\NQHZWKHVHFUHWRIWRWDOZDUDQGZKLOH ZHWRGD\FDQFHUWDLQO\FODLPULJKWVWRLPSRUWDQWWHFKQLFDOLPSURYHPHQWVZHFRQWLQXHWR VKDUHWKHLUEDVLFVWUDWHJLFGLOHPPDQRDPRXQWRIIHDUDQGORDWKLQJFRXOGHYHUDOORZWKHP WRIRUJHWZKDWWKHVHFUHWZDV (XURSHVFRQVFLRXVQHVVRIWKHJUDYHGDQJHUODWHQWLQWKHLGHDRIWKHQDWLRQLQDUPV VKDSHGVWUDWHJLFSODQQLQJWKURXJKRXWWKH&RQFHUWVKLVWRU\,QWKHHDUO\\HDUVWKHGHPDQGV RIFRXQWHUUHYROXWLRQHQFRXUDJHGDOOVWDWHVWRUHO\RQPRGHVWPLOLWDU\HVWDEOLVKPHQWV FRPSRVHGRISURIHVVLRQDORUDULVWRFUDWLFRIILFHUVORQJVHUYLFHYROXQWHHUVDQGFRQVFULSWV

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pHHQPDVVHHQDFWHGE\WKH5HYROXWLRQDU\ &RQYHQWLRQLQWKHVXPPHURI,QWKHZRUGVRIWKHGHFUHHHVWDEOLVKLQJWKHOHYp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pH)UDQFHKDGEHHQDWZDUIRU DERXWPRQWKVDWZKLFKSRLQWQHLWKHURI)UDQFHVPDMRURSSRQHQWV3UXVVLDDQG $XVWULDKDGPRELOL]HGDOORIWKHLUIRUFHV2QO\DERXWIRUHLJQHUVZHUHILJKWLQJRQ )UHQFKVRLOLQWKHVXPPHURIZKLOH)UDQFHKDGDERXWPHQXQGHUDUPV :LWKLQ\HDUVKRZHYHUWKH)UHQFKDUP\QXPEHUHGRYHUDPLOOLRQPHQDQGZKDWKDG EHJXQDVDURXWLQHZDURISLFNHWVDQGRXWSRVWVZDVRQLWVZD\WREHFRPLQJDVWUXJJOHIRU WKHIXWXUHRI(XURSH )DUPRUHWKDQWKHJKRVWRI%RQDSDUWHLWZDVWKHJKRVWRIWKHOHYp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

FRXOGGHOLYHUDQHIIHFWLYHDWWDFN

7RDGHJUHHWKDWPD\EHLQVXIILFLHQWO\DSSUHFLDWHGLWZDVWKHQDWLRQLQDUPV UDWKHUWKDQWKH'HFODUDWLRQRI5LJKWVRI0DQDQGWKH&LWL]HQWKDWFRQMXUHGXSWKHUHDO PHDQLQJRIUHYROXWLRQIRUWKFHQWXU\(XURSH,WKDGEHHQWKHOHYp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pHHQPDVVHZDVUHERUQLQWKHIRUPRIWHUURULVWVJXHUULOOD EDQGVDQGSDUWLVDQIRUFHVRIEDWWDOLRQDQGHYHQGLYLVLRQVL]HVSRQWDQHRXVO\RUJDQL]HGWR DWWDFNDQGKDUDVV3UXVVLDQIRUPDWLRQVVWUXQJRXWLQLVRODWHGVLHJHVWKDWODLGHQGWRHQG ZRXOGKDYHUHSUHVHQWHGDIRUWLILHGOLQHDOPRVWDVORQJDVWKH:HVWHUQ)URQWLQ:RUOG:DU ,)RUVXFKZDUIDUHDPLOOLRQPHQDQGPRUHZHUHVFDUFHO\HQRXJK3UXVVLDSUHYDLOHGLQ WKHHQGSDUWO\EHFDXVH)UHQFKDXWKRULWLHVZHUHHDJHUWRUHJDLQFRQWURORIWKHLURZQ FRXQWU\DQGFRRSHUDWHGLQGRLQJVR%XWWKHODVWPRQWKVRIWKH)UDQFR3UXVVLDQ:DUZHUH VWLOODQH[SHULHQFHWKDW0ROWNHWKHDUFKLWHFWRI3UXVVLDVYLFWRU\ZRXOGQHYHUIRUJHW+H UHPDLQHGFRQYLQFHGIRUWKHUHVWRIKLVOLIHWKDWKHKDGJRWWHQOXFN\LQ)UDQFHDQGKH GRXEWHGWKDWVLPLODUUHVXOWVFRXOGEHDFKLHYHGDJDLQ 7KH)UDQFR3UXVVLDQ:DUWKXVUHPLQGHG(XURSHRIZKDWZDUDVDULYHU RYHUUXQQLQJLWVEDQNVZDVOLNHZKLFKZDVSDUWRIWKHUHDVRQZK\WKLVSDUWLFXODUFRQIOLFW EURXJKWWKH&RQFHUWVSHULRGRIFULVLVWRDQHQG$WWKHVDPHWLPH3UXVVLDVWULXPSK VHHPHGWRGHPRQVWUDWHERWKWKHSRVVLELOLW\DQGWKHQHFHVVLW\RIODUJHIRUFHVDQGGHHS UHVHUYHV6WLOOVWUDWHJLFGHFLVLRQPDNLQJUHPDLQHGVWURQJO\LQIOXHQFHGE\VRFLDO FRQVLGHUDWLRQV*HUPDQ\ZRXOGKDYHKDGDPXFKODUJHUDUP\LQLILQSUHYLRXV\HDUV LWKDGEHHQZLOOLQJWRFRQVFULSWZRUNLQJFODVVVROGLHUV7RKDYHGRQHVRKRZHYHUZRXOG KDYHEHHQWRDGPLWSRWHQWLDOO\VXEYHUVLYHHOHPHQWVLQWRWKHDUPHGIRUFHVDQGUHTXLUHGWKH FRPPLVVLRQLQJRIPDQ\PRUHPLGGOHFODVVRIILFHUVZKLFKZRXOGKDYHGLOXWHGWKH DULVWRFUDF\VKROGRQWKHSULYLOHJHVRIPLOLWDU\UDQN 7KHJRDORIFRQVFULSWLRQLQWKHWKFHQWXU\ZDVQRWWRWDSWKHPLOLWDU\HQHUJ\RI WKHQDWLRQLQDUPVEXWWRSURYLGHSURIHVVLRQDOVROGLHUVZLWKWKHWRROVWKH\QHHGHGWRGR WKHLUMREZKLFKZDVPRVWGHFLGHGO\WRZDJHRIIHQVLYHZDULQDIDVKLRQWKDWSUHVHUYHG

ZDUVSROLWLFDOXWLOLW\7UXO\XQLYHUVDOVHUYLFHLQVWLWXWLRQDOL]HGDVQDWLRQDOGHIHQVHIRUFHV DQGSRSXODUPLOLWLDVUHPDLQHGDFDXVHRIWKH/HIWWKURXJKRXWWKH&RQFHUWVKLVWRU\,WV PRVWSURPLQHQWDGYRFDWHDWWKHHQGZDVWKH)UHQFK6RFLDOLVW-HDQ-DXUqVZKRUHJXODUO\ LQYRNHGWKHOHJHQGRIWKHOHYp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



86$50<:$5&2//(*( 0DMRU*HQHUDO5LFKDUG$&KLOFRDW &RPPDQGDQW 675$7(*,&678',(6,167,787( 'LUHFWRU &RORQHO5LFKDUG+:LWKHUVSRRQ 'LUHFWRURI5HVHDUFK 'U(DUO+7LOIRUG-U $XWKRU 'U'DQLHO0RUDQ (GLWRU 0UV0DULDQQH3&RZOLQJ 6HFUHWDU\ 0V5LWD$5XPPHO &RQIHUHQFH$UW 0U/DZUHQFH0LOOHU &RPSRVLWLRQ 0U'DQLHO%%DUQHWW &RYHU$UWLVW 0U-DPHV(.LVWOHU

You might also like