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ASIAN MARKETS GAIN AFTER US HOUSE PASSES STIMULUS BILL; EUROPE OPENS DOWN

Posted by Gilmour Poincaree on January 29, 2009

January 29, 2009 – 3:45 AM

by Stephen Wright – Associated Press

PUBLISHED BY ‘THE STAR TRIBUNE’ (USA)

BANGKOK, Thailand – Asian markets advanced Thursday, with Hong Kong jumping 4.6 percent in a catch-up rally, as the U.S. House of Representatives approved a $819 billion stimulus bill that investors hope will help lift the American economy out of its worst crisis in decades. European markets opened lower.

Japan’s Nikkei 225 stock average rose 144.95 points, or 1.8 percent, to 8,251.24 even as new data showed that retail sales in the world’s second-largest economy sank the most in nearly four years in December.

Hong Kong’s Hang Seng leaped 575.83 points, or 4.6 percent, to 13,154.43 after being closed for three days for the Lunar New Year. Mainland China’s markets are closed all week. South Korea’s Kospi gained 0.7 percent and Australia’s main index rose 0.9 percent.

Sentiment in Asia got a boost as President Barack Obama’s massive stimulus package moved closer to becoming a reality.

The Democratic-controlled House of Representatives approved the bill Wednesday night, sending it to the Senate where debate could begin as early as Monday. Democratic leaders have pledged to have legislation ready for Obama’s signature by mid-February.

“The U.S. stimulus package has a positive psychological impact on markets globally,” said Castor Pang, an analyst at Sun Hung Kai Financial in Hong Kong.

“But there is still going to be bad news in the form of profit warnings and unemployment,” he said. “The unemployment rate is going to continue to climb, making U.S. consumers even more hesitant about spending.”

As trading got underway in Europe, major bourses fell with France’s CAC-40 off 1.1 percent, Germany’s DAX down 1 percent and Britain’s FTSE 100 slipping 1.1 percent.

U.S. stock index futures were down, suggesting Wall Street would open lower Thursday. Dow futures were down 87 points, or 1.1 percent, at 8,235 and S&P500 futures were off 8.6 points, or 1 perc(AP) — ent, at 862.90.

Financial stocks led Asia’s advance Thursday, buoyed in part by hopes of new U.S. efforts to trim bad debt and spur lending.

In Hong Kong, banking giant HSBC jumped 8.4 percent and China’s top lender, Industrial & Commercial Bank of China Ltd., or ICBC, added 5 percent.

In Tokyo, megabank Sumitomo Mitsui Financial Group soared 13 percent, Mitsubishi UFJ jumped 4.8 percent and Mizuho added 5.2 percent.

Japanese exporters such as Sony and Toshiba reported weak quarterly results after the market closed.

Sony Corp.’s net profit tumbled 95 percent in the October-December quarter, as the global slump hurt sales of its core electronics products, while Toshiba Corp. sank into the red in the third quarter and expects a loss for the full year.

Elsewhere, New Zealand’s benchmark index was up 0.8 percent after the central bank slashed its key interest rate by 1.5 percentage points to 3.5 percent to prevent the country’s recession from deepening.

Oil prices slipped below $42 a barrel as rising U.S. crude inventories offset expectations the U.S. stimulus package will revive growth and consumer demand. Light, sweet crude for March delivery was down 34 cents to $41.82 a barrel by midday in Singapore in electronic trading on the New York Mercantile Exchange.

In currency trading, the dollar fell to 90.02 yen from 90.41 late Wednesday in New York, while the euro declined to $1.3044 from $1.3139.

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PUBLISHED BY ‘THE STAR TRIBUNE’ (USA)

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Posted in AGRICULTURE, ASIA, BANKING SYSTEMS, BARACK HUSSEIN OBAMA -(DEC. 2008/JAN. 2009), CHINA, COMMERCE, COMMODITIES MARKET, ECONOMIC CONJUNCTURE, ECONOMY, ECONOMY - USA, EUROPE, FINANCIAL CRISIS - USA - 2008/2009, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, GERMANY, HONG KONG, INDUSTRIAL PRODUCTION, INDUSTRIES, INTERNATIONAL, JAPAN, RECESSION, RESTRUCTURING OF PRIVATE COMPANIES, RESTRUCTURING OF THE PUBLIC SECTOR, STOCK MARKETS, THE EUROPEAN UNION, THE FLOW OF INVESTMENTS, THE PRESIDENCY - USA, THE WORK MARKET, UNEMPLOYMENT, UNITED KINGDOM, USA | Leave a Comment »

DEEP RECESSION AND UNEMPLOYMENT THREATEN EUROPE

Posted by Gilmour Poincaree on January 21, 2009

January 20, 2009 Tuesday – Muharram 22, 1430

Agence France-Presse

PUBLISHED BY ‘DAWN’ (Pakistan)

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PUBLISHED BY ‘DAWN’ (Pakistan)

Posted in BANKING SYSTEMS, CENTRAL BANKS, COMMERCE, COMMODITIES MARKET, ECONOMIC CONJUNCTURE, ECONOMY, EUROPE, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, FINANCIAL SERVICES INDUSTRIES, INTERNATIONAL, RECESSION, REGULATIONS AND BUSINESS TRANSPARENCY, THE FLOW OF INVESTMENTS, UNEMPLOYMENT | 1 Comment »

EUROPE MAY TAKE GREATER DIRECT CONTROL OVER BANKS

Posted by Gilmour Poincaree on January 20, 2009

January 19, 2009

by David Jolly

PUBLISHED BY ‘THE INTERNATIONAL HERALD TRIBUNE’ (USA)

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PUBLISHED BY ‘THE INTERNATIONAL HERALD TRIBUNE’ (USA)

Posted in BANKING SYSTEMS, CENTRAL BANKS, ECONOMIC CONJUNCTURE, ECONOMY, EUROPE, EUROPEAN CENTRAL BANK, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, FINANCIAL SERVICES INDUSTRIES, INTERNATIONAL, RECESSION, REGULATIONS AND BUSINESS TRANSPARENCY, RESTRUCTURING OF PRIVATE COMPANIES, THE EUROPEAN UNION, THE FLOW OF INVESTMENTS | Leave a Comment »

IRISH ECONOMY ‘WILL LEAD EUROPE WITHIN A DECADE’ – US ECONOMIST THINKS GROWTH RATES WILL EVENTUALLY OUTSTRIP MAIN RIVALS

Posted by Gilmour Poincaree on January 12, 2009

Sunday 11 January 2009

by Henry McDonald – The Observer

PUBLISHED BY ‘THE GUARDIAN’ (UK)

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PUBLISHED BY ‘THE GUARDIAN’ (UK)

Posted in ECONOMIC CONJUNCTURE, ECONOMY, EUROPE, FINANCIAL CRISIS 2008/2009, INDUSTRIAL PRODUCTION, INDUSTRIES, INTERNATIONAL, IRELAND, RECESSION, REGULATIONS AND BUSINESS TRANSPARENCY, RESTRUCTURING OF PRIVATE COMPANIES, RESTRUCTURING OF THE PUBLIC SECTOR, STATE TARIFFS, THE FLOW OF INVESTMENTS | Leave a Comment »

RUSSIA, EU SIGN DEAL ON GAS TRANSIT VIA UKRAINE – NOVO-OGARYOVO, RUSSIA: RUSSIAN AND EUROPEAN UNION OFFICIALS CLEARED THE WAY FOR RESTARTING RUSSIAN NATURAL GAS SUPPLIES TO A FREEZING EUROPE WITH A DEAL SATURDAY ON THE DEPLOYMENT OF EU OBSERVERS TO MONITOR THE FLOW ACROSS UKRAINE

Posted by Gilmour Poincaree on January 11, 2009

Sunday, 11 Jan, 2009 – 02:43 AM PST

Agence France-Presse

PUBLISHED BY ‘DAWN’ (Pakistan)

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PUBLISHED BY ‘DAWN’ (Pakistan)

Posted in COMMERCE, COMMODITIES MARKET, ECONOMIC CONJUNCTURE, ECONOMY, ENERGY, ENERGY INDUSTRIES, EUROPE, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, FOREIGN POLICIES, INDUSTRIAL PRODUCTION, INDUSTRIES, INFLATION, INTERNATIONAL, INTERNATIONAL RELATIONS, NATURAL GAS, PUBLIC SECTOR AND STATE OWNED ENTERPRISES, REGULATIONS AND BUSINESS TRANSPARENCY, RUSSIA, THE EUROPEAN UNION, THE FLOW OF INVESTMENTS, UKRAINE | Leave a Comment »

ECB’S TRICHET SAYS BANK CONSIDERING BIGGER REGULATORY ROLE (E.U.)

Posted by Gilmour Poincaree on January 10, 2009

January 9, 2009 – 12:11 PM

by Greg Keller and Nathalie Gentaz – Associated Press

PUBLISHED BY ‘THE STAR TRIBUNE’ (USA)

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PUBLISHED BY ‘THE STAR TRIBUNE’ (USA)

Posted in BANKING SYSTEMS, CENTRAL BANKS, ECONOMIC CONJUNCTURE, ECONOMY, EUROPE, EUROPEAN CENTRAL BANK, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, FINANCIAL SERVICES INDUSTRIES, FOREIGN POLICIES, INTERNATIONAL, INTERNATIONAL ECONOMIC ORGANIZATIONS AND FORUMS, INTERNATIONAL RELATIONS, JUDICIARY SYSTEMS, MACROECONOMY, RECESSION, REGULATIONS AND BUSINESS TRANSPARENCY, RESTRUCTURING OF PRIVATE COMPANIES, THE EUROPEAN UNION, THE FLOW OF INVESTMENTS | Leave a Comment »

E.U. ANNOUNCES BREAKTHROUGH IN GAS DISPUTE

Posted by Gilmour Poincaree on January 9, 2009

Friday, 09 Jan, 2009 – 05:43 AM PST

Agence France-Presse

PUBLISHED BY ‘DAWN’ (Pakistan)

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PUBLISHED BY ‘DAWN’ (Pakistan)

Posted in COMMERCE, COMMODITIES MARKET, ECONOMIC CONJUNCTURE, ECONOMY, ENERGY, ENERGY INDUSTRIES, EUROPE, FINANCIAL CRISIS 2008/2009, FOREIGN POLICIES, INDUSTRIAL PRODUCTION, INDUSTRIES, INTERNATIONAL, INTERNATIONAL RELATIONS, NATURAL GAS, PUBLIC SECTOR AND STATE OWNED ENTERPRISES, RECESSION, REGULATIONS AND BUSINESS TRANSPARENCY, RUSSIA, THE EUROPEAN UNION, UKRAINE | Leave a Comment »

GAZPROM: ESTÁ SE TORNANDO INÚTIL ENVIAR GÁS PARA EUROPA (Russia)

Posted by Gilmour Poincaree on January 7, 2009

[ 06/01/2009 ]

Cruzeiro On Line

PUBLISHED BY ‘JORNAL CRUZEIRO DO SUL’ (Brazil)

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PUBLISHED BY ‘JORNAL CRUZEIRO DO SUL’ (Brazil)

Posted in COMMERCE, COMMODITIES MARKET, CORRUPTION, CRIMINAL ACTIVITIES, ECONOMIC CONJUNCTURE, ECONOMY, ENERGY, ENERGY INDUSTRIES, EUROPE, FINANCIAL CRISIS 2008/2009, FOREIGN POLICIES, FRAUD, INDUSTRIAL PRODUCTION, INDUSTRIES, INTERNATIONAL, INTERNATIONAL RELATIONS, JUDICIARY SYSTEMS, NATURAL GAS, PUBLIC SECTOR AND STATE OWNED ENTERPRISES, RECESSION, REGULATIONS AND BUSINESS TRANSPARENCY, RUSSIA, STOCK MARKETS, UKRAINE | Leave a Comment »

ANTI-JEWISH VIOLENCE IN EUROPE

Posted by Gilmour Poincaree on January 7, 2009

January 6, 2009

Associated Press

PUBLISHED BY ‘THE INTERNATIONAL HERALD TRIBUNE’ (USA)

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PUBLISHED BY ‘THE INTERNATIONAL HERALD TRIBUNE’ (USA)

Posted in ECONOMIC CONJUNCTURE, ECONOMY, EUROPE, FINANCIAL CRISIS 2008/2009, HATE MONGERING AND BIGOTRY, INTERNATIONAL, ISRAEL, JUDAISM, PALESTINE, RECESSION, THE ISRAELI-PALESTINIAN STRUGGLE, WARS AND ARMED CONFLICTS | Leave a Comment »

RUSSIA SHUTS OFF GAS SUPPLY TO UKRAINE – ASSURES NO DISRUPTIONS TO EUROPEAN STATES

Posted by Gilmour Poincaree on January 2, 2009

Friday, January 2, 2009

Reuters

PUBLISHED BY ‘THE MANILA BULLETIN’ (Philippines)

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PUBLISHED BY ‘THE MANILA BULLETIN’ (Philippines)

Posted in COMMERCE, COMMODITIES MARKET, ECONOMIC CONJUNCTURE, ECONOMY, ENERGY INDUSTRIES, EUROPE, FINANCIAL CRISIS 2008/2009, FOREIGN DEBTS, FOREIGN POLICIES, INDUSTRIAL PRODUCTION, INDUSTRIES, INTERNATIONAL, INTERNATIONAL RELATIONS, NATURAL GAS, PUBLIC SECTOR AND STATE OWNED ENTERPRISES, RECESSION, REGULATIONS AND BUSINESS TRANSPARENCY, RUSSIA, THE EUROPEAN UNION, THE FLOW OF INVESTMENTS, UKRAINE | Leave a Comment »

EUROPE HAS A CHANCE TO UNITE ON BROADBAND

Posted by Gilmour Poincaree on December 29, 2008

December 28, 2008

by Kevin J. O’Brien

PUBLISHED BY ‘THE INTERNATIONAL HERALD TRIBUNE’ (USA)

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PUBLISHED BY ‘THE INTERNATIONAL HERALD TRIBUNE’ (USA)

Posted in COMMUNICATION INDUSTRIES, DIGITAL INDUSTRIES, ECONOMIC CONJUNCTURE, ECONOMY, ELECTRIC / ELECTRONIC INDUSTRIES, ENTERTAINMENT INDUSTRIES, EUROPE, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, FINANCIAL SERVICES INDUSTRIES, INDUSTRIAL PRODUCTION, INDUSTRIES, INTERNATIONAL, MACROECONOMY, RECESSION, REGULATIONS AND BUSINESS TRANSPARENCY, THE EUROPEAN UNION, THE FLOW OF INVESTMENTS | Leave a Comment »

EUROPEAN AND ASIAN STOCKS GAIN, LED BY ENERGY SHARES

Posted by Gilmour Poincaree on December 29, 2008

December 29, 2008

by by Matthew Saltmarsh

PUBLISHED BY ‘THE INTERNATIONAL HERALD TRIBUNE’ (USA)

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PUBLISHED BY ‘THE INTERNATIONAL HERALD TRIBUNE’ (USA)

Posted in ASIA, COMMODITIES MARKET, ECONOMIC CONJUNCTURE, ECONOMY, ENERGY, ENERGY INDUSTRIES, EUROPE, FINANCIAL CRISIS 2008/2009, INDUSTRIAL PRODUCTION, INDUSTRIES, INTERNATIONAL, RECESSION, STOCK MARKETS, THE FLOW OF INVESTMENTS | Leave a Comment »

TOUGH CLIMATE GOALS MAY BE EASIER THAN FEARED

Posted by Gilmour Poincaree on December 26, 2008

December 22, 2008

by Alister Doyle – Environment Correspondent – Reuters Environment

PUBLISHED BY ‘SCIENTIFIC AMERICAN’ (USA)

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Posted in ECONOMIC CONJUNCTURE, ECONOMY, ENERGY INDUSTRIES, ENVIRONMENT, EUROPE, FINANCIAL CRISIS 2008/2009, FOREIGN POLICIES, GERMANY, GLOBAL WARMING, INDUSTRIAL PRODUCTION, INDUSTRIES, INTERNATIONAL, INTERNATIONAL RELATIONS, METALS INDUSTRY, MINING INDUSTRIES, NETHERLANDS, PAPER INDUSTRIES, RECESSION, REFINERIES - PETROL/BIOFUELS, THE FLOW OF INVESTMENTS | Leave a Comment »

‘RUSSIAN’ HACKERS TARGET U.S., EUROPE FOR PROFIT AND POLITICS

Posted by Gilmour Poincaree on December 26, 2008

December 26, 2008

by Alex Rodriguez – Tribune Correspondent

PUBLISHED BY ‘CHICAGO TRIBUNE’ (USA)

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PUBLISHED BY ‘CHICAGO TRIBUNE’ (USA)

Posted in BANKING SYSTEM - USA, BANKING SYSTEMS, CHINA, CRIMINAL ACTIVITIES, CYBER CRIMES, DIGITAL INDUSTRIES, ECONOMIC CONJUNCTURE, ECONOMY, ECONOMY - USA, ESTONIA, EUROPE, FINANCIAL CRISIS - USA - 2008/2009, FINANCIAL CRISIS 2008/2009, FOREIGN POLICIES, GEORGIA, INDUSTRIES, INTERNATIONAL, INTERNATIONAL RELATIONS, RECESSION, REGULATIONS AND BUSINESS TRANSPARENCY, RUSSIA, SWEDEN, THE LAST DAYS OF GEORGE WALKER BUSH - 2008/Jan. 2009, USA | Leave a Comment »

GRIM OUTLOOK FOR RICH NATIONS

Posted by Gilmour Poincaree on December 25, 2008

Tuesday, November 25, 2008 – 23:44 Mecca time, 20:44 GMT

AlJazeera

PUBLISHED BY ‘ALJAZEERA’ (Qatar)

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PUBLISHED BY ‘ALJAZEERA’ (Qatar)

Posted in AUSTRALIA, BANKING SYSTEMS, BELGIUM, CENTRAL BANKS, COMMERCE, COMMODITIES MARKET, ECONOMIC CONJUNCTURE, ECONOMY, ECONOMY - USA, EUROPE, FINANCIAL CRISIS - USA - 2008/2009, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, FRANCE, GERMANY, HOUSING CRISIS - USA, INTERNATIONAL, ITALY, MACROECONOMY, RECESSION, REGULATIONS AND BUSINESS TRANSPARENCY, SAUDI ARABIA, SPAIN, STOCK MARKETS, THE EUROPEAN UNION, THE FLOW OF INVESTMENTS, THE LAST DAYS OF GEORGE WALKER BUSH - 2008/Jan. 2009, UNITED KINGDOM, USA | Leave a Comment »

GOLDEN TICKET TO GLOBAL EXPORT ARENA (Malaysia)

Posted by Gilmour Poincaree on December 25, 2008

Thursday December 25, 2008

by Hanim Adnan – Assistant News Editor – The Star

PUBLISHED BY ‘THE STAR’ (Malaysia)

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PUBLISHED BY ‘THE STAR’ (Malaysia)

Posted in AGRICULTURE, COMMERCE, COMMERCIAL PROTECTIONISM, COMMODITIES MARKET, ECONOMIC CONJUNCTURE, ECONOMY, ENVIRONMENT, EUROPE, FINANCIAL CRISIS 2008/2009, FOREIGN POLICIES, INDUSTRIAL PRODUCTION, INDUSTRIES, INTERNATIONAL, INTERNATIONAL RELATIONS, MALAYSIA, RECESSION, REGULATIONS AND BUSINESS TRANSPARENCY, VEGETABLE OILS | 1 Comment »

BANCO CENTRAL EUROPEU NÃO SEGUIRÁ JURO ZERO DOS EUA

Posted by Gilmour Poincaree on December 23, 2008

22/12/2008

Jornal Cruzeiro do Sul

PUBLISHED BY ‘JORNAL CRUZEIRO DO SUL’ (Brazil)

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PUBLISHED BY ‘JORNAL CRUZEIRO DO SUL’ (Brazil)

Posted in BANKING SYSTEM - USA, CENTRAL BANKS, ECONOMIC CONJUNCTURE, ECONOMY, ECONOMY - USA, EURO, EUROPE, EUROPEAN CENTRAL BANK, FINANCIAL CRISIS - USA - 2008/2009, FINANCIAL CRISIS 2008/2009, INTERNATIONAL, RECESSION, THE EUROPEAN UNION, THE LAST DAYS OF GEORGE WALKER BUSH - 2008/Jan. 2009, USA | Leave a Comment »

BRASIL E UE DEVEM ATUAR JUNTOS EM CÚPULA DO G20 (Brazil)

Posted by Gilmour Poincaree on December 23, 2008

22/12/2008 – 18:01

Da FolhaNews

PUBLISHED BY ‘CORREIO BRAZILIENSE’ (Brasil)

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PUBLISHED BY ‘CORREIO BRAZILIENSE’ (Brasil)

Posted in AGRICULTURE, BRASIL, COMMERCIAL PROTECTIONISM, ECONOMIA - BRASIL, ECONOMIC CONJUNCTURE, ECONOMY, EUROPE, FARMING SUBSIDIES, FINANCIAL CRISIS 2008/2009, FOREIGN POLICIES, G20, INTERNATIONAL, INTERNATIONAL RELATIONS, POLÍTICA EXTERNA - BRASIL, RECESSION, RELAÇÕES COMERCIAIS INTERNACIONAIS - BRASIL, RELAÇÕES DIPLOMÁTICAS - BRASIL, RELAÇÕES INTERNACIONAIS - BRASIL | Leave a Comment »

DOLLAR LOWER, GOLD FALLS IN EUROPEAN AFTERNOON TRADING

Posted by Gilmour Poincaree on December 16, 2008

December 15, 2008 – 11:10 AM

Associated Press

PUBLISHED BY ‘THE STAR TRIBUNE’ (USA)

LONDON – The U.S. dollar was lower against other major currencies in European trading Monday afternoon. Gold fell.

The euro traded at $1.3650, up from $1.3371 late Friday in New York.

Other dollar rates:

_ 90.67 Japanese yen, down from 91.12

_ 1.1599 Swiss francs, down from 1.1767

_ 1.2341 Canadian dollars, down from 1.2432

The British pound was quoted at $1.5303, up from $1.4969.

Gold traded in London at $826.00 per troy ounce, down from $826.50 late Friday.

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PUBLISHED BY ‘THE STAR TRIBUNE’ (USA)

Posted in CANADA, DOLLAR (USA), ECONOMIC CONJUNCTURE, ECONOMY, ECONOMY - USA, EURO, EUROPE, FINANCIAL CRISIS - USA - 2008/2009, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, GOLD, INTERNATIONAL, POUND (Britain), RECESSION, SWITZERLAND, THE LAST DAYS OF GEORGE WALKER BUSH - 2008/Jan. 2009, UNITED KINGDOM, USA | Leave a Comment »

POUND SLUMPS TO RECORD LOW OF £1.11 AGAINST THE EURO AS CURRENCIES EDGE TOWARDS PARITY

Posted by Gilmour Poincaree on December 16, 2008

4:55 PM on 15th December 2008

by Daily Mail Reporter

PUBLISHED BY ‘THE DAILY MAIL’ (UK)

The pound slumped to fresh lows against the euro today as the two currencies edged closer to parity.

At its low, one pound bought just 1.1102 euros – its latest in a series of record plunges against the single European currency in recent days.

Some holidaymakers travelling to Europe are reportedly already receiving less than one euro for their pound at bureaux de change, where commission is charged.

Sterling has dropped around 13 per cent against the euro in the past two months as the Bank of England has slashed interest rates in its attempt to stave off a deep and prolonged recession.

UK rates have dropped to 2 per cent, below those in the eurozone after a 1.5 per cent cut in November and a 1 per cent cut earlier this month, which has compounded the pound’s woes.

The weaker currency could provide a boost to UK exporters but the economic woes of major export markets such as the U.S. and Europe is hitting demand.

It is thought short-selling – where investors sell assets such as shares or currencies in the hope of buying them back later at a lower price and pocketing the difference – is also behind the pound’s slide.

The pound has also suffered big recent falls against the dollar but was holding steady at just under 1.50 U.S. dollars today.

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PUBLISHED BY ‘THE DAILY MAIL’ (UK)

Posted in CURRENCIES, DOLLAR (USA), ECONOMIC CONJUNCTURE, ECONOMY, ECONOMY - USA, EURO, EUROPE, EUROPEAN CENTRAL BANK, FINANCIAL CRISIS - USA - 2008/2009, FINANCIAL CRISIS 2008/2009, INTERNATIONAL, POUND (Britain), RECESSION, THE EUROPEAN UNION, THE LAST DAYS OF GEORGE WALKER BUSH - 2008/Jan. 2009, UNITED KINGDOM, USA | Leave a Comment »

POUND CONTINUES FALL AGAINST EURO – Sterling has fallen to a fresh record low against the euro, while the value of the dollar has declined on talks about possible US rate cuts

Posted by Gilmour Poincaree on December 15, 2008

Monday, 15 December 2008

PUBLISHED BY ‘BBC NEWS’ (UK)

The pound touched a record low of 1.1084 euros, which made one euro worth 90.22p, before recovering slightly to 1.1196 euros.

Meanwhile, the dollar fell as analysts predicted the Federal Reserve would cut interest rates on Tuesday.

The dollar fell to $1.3662 against the euro and $1.5294 against sterling.

POUND STERLING v EURO: 15 December 2008

Sterling has now hit record lows against the euro for six trading days in a row.

“Sterling remains under pressure on continued UK economic weakness,” said Geoff Kendrick at UBS.

Bail-out factor

The dollar declined on Monday on worries over the strength of the US economy, and on the uncertainty surrounding the bail-out of US carmakers.

“An interim bail-out plan for US automakers by the Bush administration is certainly weighing on the dollar, with many being sceptical as to how the industry can cope in the longer term and instead thinking that letting the market take its course would be a preferred route,” said currency analyst James Hughes at CMC Markets.

The euro was supported by suggestions from European Central Bank officials that interest rates in the eurozone might not fall too much further.

Interest rates are at 2.5% in the eurozone, compared with 2% in the UK and 1% in the US.

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PUBLISHED BY ‘BBC NEWS’ (UK)

Posted in BANKING SYSTEM - USA, BANKING SYSTEMS, CENTRAL BANKS, CURRENCIES, DOLLAR (USA), ECONOMIC CONJUNCTURE, ECONOMY, ECONOMY - USA, EURO, EUROPE, EUROPEAN CENTRAL BANK, FINANCIAL CRISIS - USA - 2008/2009, FINANCIAL CRISIS 2008/2009, INTERNATIONAL, POUND (Britain), RECESSION, THE LAST DAYS OF GEORGE WALKER BUSH - 2008/Jan. 2009, UNITED KINGDOM, USA | Leave a Comment »

POOR NATIONS TO GET FUNDS TO FIGHT CLIMATE CHANGE

Posted by Gilmour Poincaree on December 14, 2008

Saturday December 13 2008

by Arthur Max – Associated Press Writer (Associated Press writers Geir Moulson, Vanessa Gera and Ryan Lucas contributed to this report)

PUBLISHED BY ‘THE GUARDIAN’ (UK)

POZNAN, Poland (AP) – Negotiators at a U.N. climate conference broke through red tape and freed up millions of dollars Friday to help poor countries adapt to increasingly severe droughts, floods and other effects of global warming.

“This could be the one thing to come out of Poznan,” said Kit Vaughan of WWF-Britain.

The decision in the final hours of the two-week conference could begin to release some $60 million (euro45 million) within months, according to delegates and environmentalists following the closed-door talks.

“This is an important step,” said delegate Mozaharul Alam of Bangladesh.

Alam said ministers and senior delegates from dozens of countries decided to give a blocked fund’s governing board the authority to directly disburse money to developing countries for projects to reduce greenhouse gases.

Until now, the U.N.-backed Adaptation Fund board could not operate because its board had no right to approve and sign those contracts.

The fund is derived from a 2 percent levy on offset investments that industrial nations make on green projects in the developing world. The negotiators have been discussing other ways to ramp up the fund into the billions.

The agreement was one of the few concrete goals the delegates set for Poznan when the talks began Dec. 1. Delegations from nearly 190 countries are negotiating a new climate change pact, to be completed next December in the Danish capital of Copenhagen, that would succeed the Kyoto Protocol when it expires in 2012.

Former U.S. Vice President Al Gore, who shared last year’s Nobel peace prize for raising awareness of climate change, urged the conference to stay focused on the task of reducing global carbon emissions that have already begun to change the conditions of life on Earth.

Winning cheers and ovations, Gore called on heads of state to convene several climate change summits over the next 12 months to spur on the talks ahead of the crucial meeting in Copenhagen.

This challenge “affects the survival of human civilization,” Gore said.

“We cannot negotiate with the facts, we cannot negotiate with the truth about our situation, we cannot negotiate with the consequences of unrestrained dumping of 70 million tons of global warming pollution into the thin shell of atmosphere surrounding our planet every 24 hours,” he said.

Environmentalists have complained that the Poznan conference was hamstrung by delays and low ambitions.

“There is still time to rescue the minimum acceptable outcome from Poland, but we need to ensure that in 2009 we hit the ground running,” said Julie-Anne Richards of Oxfam, a British-based humanitarian agency.

The conference “could have been much more robust,” said Gustavo Silva-Chavez, of the Environmental Defense Fund based in New York.

The conference marks the midway point in a two-year negotiating process begun last year in Bali, Indonesia, to reach a new treaty in December 2009.

Ministers and top officials from 145 countries concluded in a round table discussion late Thursday that the negotiations over the next year should produce an ambitious agreement that can be ratified by all countries.

Still, progress has been slowed as negotiators wait for the new and more climate-friendly government of President-elect Barack Obama to take over from the outgoing Bush administration.

U.S. Senator John Kerry, who is in line for chairmanship of the powerful Foreign Relations Committee, told The Associated Press that a new draft treaty should be possible even if the U.S. does not impose mandatory limits on greenhouse gases before the next pivotal climate conference.

“I think Copenhagen should produce a treaty fundamentally geared to reductions of emissions,” Kerry said.

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PUBLISHED BY ‘THE GUARDIAN’ (UK)

Posted in AGRICULTURE, BANKING SYSTEMS, ECONOMIC CONJUNCTURE, ECONOMY, ENVIRONMENT, EUROPE, FINANCIAL CRISIS 2008/2009, FOREIGN POLICIES, FOREIGN POLICIES - USA, INDUSTRIAL PRODUCTION, INDUSTRIES, INTERNATIONAL RELATIONS, RECESSION, THE FLOW OF INVESTMENTS, THE LAST DAYS OF GEORGE WALKER BUSH - 2008/Jan. 2009, THE UNITED NATIONS, USA | Leave a Comment »

WEATHERING THE STORM – Syrians are quickly realising that the impact of the global financial crisis will be larger than first thought. In an age of globalisation, no country is an island

Posted by Gilmour Poincaree on December 13, 2008

Issue: December 2008

by Brooke Anderson

PUBLISHED BY ‘SYRIA TODAY’

Despite government assurances that their country will weather the storm engulfing markets around the world, Syrians are quickly realising that in the 21st century, no country is immune from a global economic meltdown.

“No country can say it’s unaffected,” Samira al-Masalmeh, managing editor of local affairs at the independent Syrian daily newspaper Al-Watan and the economic weekly Al-Iqtissadiya, said. “It’s true, we don’t have direct economic relations with the United States, but the crisis is affecting Europe. We work with Europe and Asia, so there is an indirect effect on Syria.”

Syria will, however, weather the storm better than most countries, Masalmeh said. “For the most part, 70 percent of investment in Syria is from inside the country,” she said. “Syria has a strong and diversified internal economy that doesn’t depend on oil. We don’t have a stock market.”

The global financial crisis, which originated in the US banking system, hits Syria at a time when the country is opening up its economy after more than 40 years of socialist rule. Many in Syria now believe the country needs to quickly learn the lessons emerging from more developed economies now battling recession. “I hope Syria will learn a lesson from America and it will put into place better laws protecting investment,” Masalmeh said.

Far from the epicentre

To date, the Syrian government has taken a cautious view of the crisis. “The Syrian economy is stable and solid and the Syrian pound is strong and protected,” Deputy Prime Minister for Economic Affairs Abdullah al-Dardari said in October. “Syria has an independent banking system. In addition, the Syrian pound has a higher interest rate than other currencies.”

Dardari also said deposits in Syrian banks have increased since the beginning of the crisis because of the stability of the local banking sector. “The government is working day and night for the stability of the economy and to serve the nation and the citizen,” he said, adding there is “no reason at all to be scared or worried”.

Likewise, Syrian Minister of Finance Muhammad al-Hussein has emphasised the limited impact the global financial crisis will have on Syria. “The worldwide financial crisis could have an effect on Syria, but the government- is working with President Bashar al-Assad to make sure the effect is limited,” Hussein told the state daily newspaper Al-Thawra. He said Syria was “far away from the epicentre of the earthquake”.

Indirect impact

One government official striking a different note is Duraid Dargham, head of the government-run Commercial Bank of Syria, the country’s largest bank. In a full-page article published in the Tishreen newspaper in early October, Dargham said the danger posed to Syria by the global financial crisis was real and significant. “The economic crisis will have a big effect on Syria,” he wrote.

Dargham said Syria’s economy would take two main hits. The first will come in a decline in both the price and global demand for oil. Since the crisis erupted, the price of oil has fallen from a record SYP 6,510 (USD 140) per barrel to around SYP 2,557 (USD 55) a barrel and the slide is expected to continue. It’s a drop which could now make growth estimates for 2009 optimistic and will further widen the country’s budget deficit, a fact Hussein pointed out at a recent banking conference.

The second blow will come from remittances from Syrians living abroad who now number a massive 18m; Syria’s internal population is little more than 19m. On average, Syrian expatriates, many of whom earn high wages in the Gulf, inject SYP 37.2bn (USD 800m) annually in remittances into the Syrian economy. With many parts of the world entering recession and unemployment rising, this stream of foreign funds is expected to slow.

Jihad Yazigi, editor of the English-language economic newsletter The Syria Report, said Syria’s links to the Gulf markets make it vulnerable to the ongoing global economic turmoil. “A lot of money comes [to Syria] from the Gulf,” he said. “Some Syrians could be made redundant in the Gulf so we could see a slower pace of remittances and that could lead to more unemployment here.”

Yazigi also points to the possibility of foreign direct investment flows slowing over the next year. Rather than the dramatic blows being landed on the world’s leading economies like the US and Japan, Yazigi said the impact on Syria would come incrementally. “We haven’t seen anything yet, because the impact is indirect,” he said. “It won’t be as dramatic as the price of stocks. It will be an interesting sign if we see the delay of one to two big Gulf investments in Syria. Investors have to prioritise when they want to invest and Syria is not a priority for them. We haven’t felt it yet, but we will. It won’t be a big impact, but there will be an impact.”

Masalmeh points to tourism, an increasingly important money spinner in Syria, as another area likely to be negatively impacted as people around the world tighten their spending habits and cancel overseas holiday plans. “The crisis will affect tourism because there’ll be less money to spend,” she said. “If there’s no money, there’s no tourism.”

Feeling the squeeze

One Syrian company is already seeing the impact of the global financial crisis firsthand. At Muhanna for Sweets, a Damascus-based family sweets business founded in 1935, chief executive officer Mahmoud Muhanna said the global financial crisis could not come at a worse time. The company is already battling the impact of a cut in fuel subsidies which has seen the price of raw materials rise. As a result, the company has had to increase the prices of its goods – 30 to 40 percent for some sweets and 100 percent for others – at a time when foreign buyers in America and Europe are looking to save money. “All of the prices of raw materials – sugar, fat, and pistachios – have increased,” Muhanna said.

Three years ago, exports made up 40 percent of all sales at Muhanna for Sweets. Now they account for just 25 percent of business. Twenty-five percent of total exports go to the US, 5 to 10 percent go to the Gulf, while the rest go to Europe.

Muhanna does not expect any growth in his exports to US and European markets in the short term. As such the Gulf and local market will become all the more important. He said his company has been helped by the steady flow of tourists in the past several years, business travellers from the Gulf and the opening of new hotels such as the Four Seasons. But it’s a customer base that might not be so reliable in the coming months, he admits.

To counter a decline in exports, Muhanna is already thinking of a plan B: creating a line of less expensive sweets. Still, he doesn’t appear to be too worried about the financial turmoil creating a crisis in sweets consumption. “No matter what happens, people always buy Arab sweets,” he said.

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PUBLISHED BY ‘SYRIA TODAY’

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COLD WAR TAKES GLOSS OFF NICOLAS SARKOZY’S PRESIDENCY

Posted by Gilmour Poincaree on December 13, 2008

December 12, 2008

Charles Bremner in Paris – The Times

PUBLISHED BY ‘THE TIMES’ (UK)

The Germans see him as an excitable clown and he raises hackles in the East, but Nicolas Sarkozy wants to extend SARKOZY, ACCORDING TO MERKELhis reign as Europe’s de facto leader after his last summit in the EU chair, which opened yesterday.

The hyperactive French President is convinced that he has galvanised Europe with deft handling of the credit crunch and other crises during his six-month EU presidency.

The satisfaction in Paris is barely dimmed by the most glaring failure of France’s presidency: Mr Sarkozy’s cold war with Angela Merkel, the German Chancellor.

The subdued Ms Merkel, who loathes Mr Sarkozy’s bravura, has been watching videos of the late Louis de Funès, a manic comic actor and Gallic institution, for clues to understanding the ever-agitated President.

Der Spiegel says that the Chancellor sees Mr Sarkozy as an “unfeasibly vain jack-in-the-box”: “She has nothing to counter him apart from her eternal impassiveness. Her fist may be clenched but she keeps it in her pocket.”

“Super Sarko”, who does not claim modesty among his qualities, is telling colleagues that he has triumphed by steering Europe through the financial crunch – with Gordon Brown’s help – and creating a new political purpose in the moribund Union.

Jean-David Levitte, the veteran diplomat who manages foreign policy from the Élysée Palace, said that Mr Sarkozy had swung the balance of power in Europe by winning over second-rank members such as Greece.

As the Czech Republic prepares to take over the presidency next month, Mr Sarkozy’s team has been setting out his plans for maintaining French direction. Last month Ms Merkel scuppered Mr Sarkozy’s attempt to appoint himself chairman of the eurozone for next year during the EU presidencies of two non-euro states. But France has another 18 months as co-chair of an EU-Mediterranean Union that Mr Sarkozy launched last July.

His next plan, not yet announced, is a new “economic and security space” with Russia, Mr Levitte disclosed. Given anger in the West towards Russia’s occupation of northern Georgia, European leaders will be surprised to learn that Mr Sarkozy aims to offer a new security pact to Russia and hopes to bring in Ukraine and Turkey.

Another item to emerge from Mr Sarkozy’s team this week has been the President’s belief that Mr Brown will swap the pound for the single currency, thereby boosting the power of the eurozone. “Do you think that they enjoy seeing sterling in such a state?” asked a senior Sarkozy adviser.

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WE WON’T BE ABLE TO ADAPT TO CLIMATE CHANGE: PACHAURI

Posted by Gilmour Poincaree on December 12, 2008

11 Dec 2008, 1021 hrs IST

IANS

PUBLISHED BY ‘THE ECONOMIC TIMES'(India)

POZNAN (POLAND): Very soon, the impacts of climate change will exceed our capacities to adapt to them, Rajendra Kumar Pachauri, Rajendra Kumar Pachaurihead of the Intergovernmental Panel on Climate Change (IPCC), has warned.

The head of the panel that has done more than anyone else to bring the effects of climate change, lowered farm output, more frequent and more severe droughts, floods and storms and a rise in sea level, to the forefront of world attention said, “The impacts of climate change are now so evident. If we don’t take immediate action they will get far worse.

“And remember, poorest countries and the poorest communities in these countries are the most vulnerable to these effects.”

As the Dec 1-12 climate summit here stayed bogged down in bickering between industrialised and developing countries over who should do what to combat climate change, Pachauri warned: “Very soon, climate change impacts will exceed the adaptive capacities of local communities.

“We have to have a strategy by which the adaptation has to be local, while mitigation (to reduce emissions of greenhouse gases that are warming the earth) has to be global.”

“The good news is that mitigation possibilities are not costly,” Pachauri added. “There is now plenty of evidence to show that moving to a low carbon renewable energy development path is a win-win solution.”

Pachauri also heads the New Delhi-based The Energy and Resources Institute, which is now distributing all over India lanterns powered by solar energy.

The head of the IPCC, which won the Nobel Peace Prize in 2007 with Al Gore for its seminal Assessment Report 4 (AR4), said that the next assessment report (AR5) would come out in 2014 and in that the IPCC would look at various new risk reduction strategies as well.

“Before that, we’re planning to bring out a special report on renewable energy sources in 2010 and maybe one on extreme weather events triggered by climate change as well.”

Since the publication of AR4, one of its principal authors Bill Hare has said here that science had advanced to the point where he could predict a strong possibility that the Greenland ice sheet would melt if the temperature rose 1.5 degrees Celsius above the pre-Industrial Age level and this would raise the sea level worldwide by 6-7 metres.

Asked about this, Pachauri said, “Even in AR4, we had not put an upper limit on sea level rise, because we simply don’t know.”

When it was pointed out that negotiators were working on the baseline figure of keeping temperature rise to two degrees Celsius and that this would mean the death of the Greenland ice sheet, Pachauri said: “Two degrees Celsius is an arbitrary number set by the EU (European Union).

“I deliberately raised that point on the opening plenary session on this Poznan summit (on Dec 1, when he had talked about the danger of even a 1.1 degree Celsius temperature rise). It was a warning that we should get nowhere close to it (a 1.1 degree rise).

“But IPCC does not prescribe. It provides the scientific information, the scenarios of what is likely to happen with what level of certainty if governments do this or that. After that, it is up to the governments.” But Pachauri did say that the IPCC would look at impacts at lower (than two degree) thresholds in its next assessment report.

When asked if he thought the negotiations at this climate change summit were too slow and the countries too reluctant to change from a business-as-usual scenario, Pachauri responded: “It is the only show in town, though it may seem painfully slow and a waste of time.

“But science can bring out the urgency of the situation. I am reasonably satisfied about the reaction we had from all countries in Bali (at the 2007 summit).” Pachauri repeated more than once, “We must keep reinforcing AR4 data, keep reminding people about it. We have to ensure that people do not lose sight of the science.”

Asked what kind of greenhouse gas emission reduction targets countries should be aiming at, Pachauri said: “The 20-20 target is very important”. That means industrialised countries reduce their greenhouse gas emissions by 20 percent from 1990 levels by 2020.

Asked how adaptation to climate change could be improved, the IPCC chief told media, “Don’t look at (global) averages. Look at specific impacts in different parts of the world. That is the way to adapt.”

What was the IPCC going to do with its share of the Nobel Peace Prize money? “We’re using it to provide fellowships to scientists in developing countries, those who are working in the area of climate change,” Pachauri said.

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PUBLISHED BY ‘THE ECONOMIC TIMES'(India)

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EU AGREES $260BN ECONOMY PLAN

Posted by Gilmour Poincaree on December 12, 2008

Friday, December 12, 2008 15:17 Mecca time, 12:17 GMT

PUBLISHED BY ‘AL JAZEERA’ (Qatar)

European Union leaders have agreed a $260bn stimulus package designed to dig the continent’s troubled economies out of recession.

The deal, which see each EU French President Nicolas Sarkozy, right, shares a word with German Chancellor Angela Merkel during a round table meeting at an EU summit in Brussels, Friday Dec. 12, 2008. European Union leaders continue their two days of talks aimed at sealing a final accord on their climate change package to cut emissions by 20 percent by 2020member invest on average the equivalent of 1.5 per cent of gross domestic product (GDP) into their economies in order to temper the impact of a global recession, was reached on Friday at a two-day summit in the Belgian capital Brussels.

“What Europe has proved unanimously today is that it is ready to act in a united way to deal with the global downturn,” Gordon Brown, Britain’s prime minister, said.

“We will continue to reject the do-nothing approach and we will not stand by and let the recession take its course.”

Ahead of the summit, Germany had expressed reservations about ploughing so much public money into the economy and resisted pressure to contribute more than what it judged necessary to revive the German economy again.

Officials revised earlier versions of the conclusions to say the package should be worth “about” 1.5 per cent of GDP rather than “at least” 1.5 per cent as seen in an earlier draft.

Climate change

After securing an agreement in the morning for Ireland to submit a stalled EU reform treaty to a second referendum next year, the 27 leaders were also hoping to reach more common ground on climate change as the day progressed.

Copies of a draft agreement indicated the leaders should commit themselves to warding off the threat of a “recessionary spiral” with the stimulus package and an ambitious climate package.

“In these exceptional circumstances, Europe will act in a united, strong, rapid and decisive manner to avoid a recessionary spiral and sustain economic activity and employment,” the draft conclusion said.

“It will mobilise all the instruments available to it and act in a concerted manner to maximise the effect of the measures taken by the [European] Union and by each member state.”

The EU’s climate-energy package, the “20-20-20” deal, seeks to decrease greenhouse gas emissions by 20 per cent by 2020, make 20 per cent energy savings and bring renewable energy sources up to 20 per cent of total energy use.

Angela Merkel, the German chancellor, said: “The member states still have essential negotiations but I am cautiously optimistic that good conclusions can be reached here and send an important signal” to an international climate conference in Copehagen next December.

Under Ireland’s referendum deal, a new referendum will be held by November 2009 on the controversial treaty in exchange for guarantees on key issues including an assurance that it does not lose its EU commissioner.

Irish voters rejected the treaty, designed to streamline EU decision-making and institutions, at a first referendum in June.

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PUBLISHED BY ‘AL JAZEERA’ (Qatar)

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SWISS BANK SECRECY IN TOUGHEST TEST SINCE NAZI GOLD

Posted by Gilmour Poincaree on December 12, 2008

December 11, 2008

by John O’Donnell – Reuters

PUBLISHED BY ‘THE FINANCIAL MIRROR’ (Cyprus)

More than a decade after holocaust survivors won compensation from Swiss banks for emptying Jewish accounts that had lain dormant since the war, the pressure is on again to dismantle Swiss banking secrecy.

This time, the tax collector is leading the charge.

With Washington joining Germany to press for an end to a code they believe helps tax dodgers, many see it as only a matter of time before the Swiss lift the cloak guarding the secrets of the world’s wealthy.

“The challenge to bank secrecy is a thunderstorm which has been brewing since the holocaust money,” said Sebastian Dovey of consultancy Scorpio Partnership. “It is a hot potato and I don’t think the heat is going to be turned down.”

Nearly one-third of wealth kept abroad globally is in Swiss banks: the Swiss Bankers Association and consultants estimate this at $2.2 trillion, making the Alpine state the globe’s biggest offshore centre ahead of Britain and Luxembourg.

But its code of secrecy — which local myth inaccurately claims was introduced to protect fleeing Jews — is as controversial as it is protective.

Laid down in a 1934 law, it has spawned plots for bestselling thrillers, but also real-life intrigues such as that of Gizella Weisshaus.

Shortly before her father was murdered by the Nazis during the war, he told his children about gold coins and jewellery he had stowed away as Germany’s army marched towards their home in Romania.

“I found the money and his gold watch hidden in the roof of my house,” she told Reuters by telephone from New York. “And there were some pieces of paper. It didn’t mean anything to me.”

Decades later, the Auschwitz survivor was still trying to unravel the riddle of those long-discarded papers which likely contained the numbers of Swiss bank accounts.

But like many others who travelled to Zurich to trace her father’s money, she was turned away repeatedly.

She later became central to a series of legal actions taken against the banks and in the mid-1990s under pressure from Washington and Jewish community group the World Jewish Congress, they finally paid $1.2 billion for accounts they had sucked dry.

Now Switzerland faces its toughest assault since. In an escalation of a U.S. investigation into its biggest bank, Raoul Weil, head of UBS’s wealth management business, was recently charged with helping Americans hide billions.

“With the UBS case, Switzerland is under huge international pressure and pretty much back in the situation it was then,” said Swiss Social Democrat party official and historian Peter Hug.

“Holding onto bank secrecy is not going to work in the long term. Switzerland is small and it cannot afford to help tax evasion in its neighbouring countries.”

POLITICAL PRIORITY

Germany, which at the start of the year paid an informant for the names of tax dodgers who parked money at LGT bank in smaller hideout Liechtenstein, is also pushing for change.

“In the end, Switzerland will have no way around declaring who its foreign bank account holders are,” said Hans Eichel, who as German Finance Minister between 1999 and 2005 tried to tackle offshore havens.

“This is a business based on a criminal activity — dodging tax in a neighbouring country.”

The Swiss have already made some concessions: introducing, for example, a tax on income earned by European Union citizens in Swiss accounts.

Stuart Eizenstat, U.S. Deputy Secretary of the Treasury under Bill Clinton, said the dormant accounts case he helped negotiate prompted the Swiss to cooperate on other fronts.

“I do think it had a catalytic effect of making the banks more open,” he said. “They became strong supporters, for example, of the anti-terrorist financing measures. It did spur them to become more open on money-laundering.”

But with demands from Germany that Switzerland be blacklisted by the Organisation for Economic Cooperation and Development, pressure is rising for more.

“The Americans said that if you do not cooperate, then we will make sure you cannot do business here,” said Eichel. “European neighbours of Switzerland such as Germany have to consider similar measures.”

Many believe an agreement between Liechtenstein and the United States this week to drop bank secrecy in cases of tax evasion could force Switzerland into similar concessions.

Prince Nikolaus, the brother of Liechtenstein’s ruling monarch and the country’s ambassador to Brussels, said UBS’s problems and Germany’s probe of his family’s bank, LGT, sent a clear message to offshore havens.

“It was these two banks — the biggest in their respective countries — which were turned into a big case,” he told Reuters by telephone from Brussels. “It has symbolic value. It shows the political priority.”

AIR THINNING FOR ELITE

The pressure from Washington is unlikely to let up. As a senator, U.S. president-elect Barack Obama introduced legislation early last year to make it easier to probe and prosecute tax dodging in offshore locations.

As president, he will need to fund an economic stimulus plan that analysts estimate could cost at least $500 billion.

Hug believes Liechtenstein’s move shows the air is also getting thinner for the Swiss elite. And he sees the first cracks appearing in the country’s usually unshakeable facade.

“There is a conflict of interest between Swiss industry and the banks,” he said. “Industry wants compromise on bank secrecy so that the country’s image is not spoilt.”

Switzerland’s banks — the liabilities of its two largest are more than seven times the country’s Gross Domestic Product — have been talking up the services they offer beyond hiding customer identity.

“This is not all we have,” said Urs Roth, Chief Executive of the Swiss Bankers Association. “We do have a number of traditional advantages, like the economic, monetary and social stability.”

Ultimately, however, it may not be the industry but Swiss pride that is the biggest hurdle to dropping bank secrecy. A nationwide vote would likely be needed to change the rules.

Few speak out publicly on the subject. No major Swiss bank wanted to discuss it with Reuters.

“The Swiss are so brainwashed, that the bank there is untouchable,” said Maram Stern, who as Deputy Secretary General of the World Jewish Congress oversaw negotiations with the Swiss banks about dormant accounts.

“This was what the normal person on the street was not capable of understanding. There were people asking me: how can you question the bank?”

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PUBLISHED BY ‘THE FINANCIAL MIRROR’ (Cyprus)

Posted in BANKING SYSTEMS, ECONOMIC CONJUNCTURE, ECONOMY, EUROPE, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, FOREIGN POLICIES, HISTORY, HUMAN RIGHTS, INTERNATIONAL, INTERNATIONAL RELATIONS, JUDAISM, JUDICIARY SYSTEMS, RECESSION, SWITZERLAND, TAX EVADING, THE EUROPEAN UNION, USA | Leave a Comment »

EU EDGES CLOSER TO CLIMATE, STIMULUS DEALS – ITALY, POLAND SEE EU CLIMATE DEAL IN OFFING

Posted by Gilmour Poincaree on December 12, 2008

December 12, 2008

by Jan Strupczewski and Pete Harrison – Reuters

PUBLISHED BY ‘THE FINANCIAL MIRROR’

European leaders moved towards agreement on Friday on a multi-billion dollar plan to tackle the global recession and a climate change plan amended to limit impact on struggling industries.

Green groups warned that the European Union could forfeit its credibility as a force in tackling climate change if it accepted too many changes to a plan to cut carbon dioxide emissions by 20 percent by 2020.

One British group said compromises in climate policy, which will be key to world talks next year to produce a successor to the Kyoto pact on climate change, could amount to a ‘meltdown’.

The climate discussions took on a special significance, taking place some six weeks before Barack Obama takes over the U.S. presidency holding out the prospect of closer co-operation in matters of global warming.

Italian Prime Minister Silvio Berlusconi, who had threatened to veto a deal without concessions to protect key industries, emerged from the first day of a two-day summit, declaring: “We are heading towards a compromise…We are getting what we want.”

Poland, which had demanded concessions on its heavily polluting coal-based power industry, was also cautiously optimistic.

“The prime minister (Donald Tusk) achieved everything he wanted in negotiations on the climate package,” an official told Reuters. “The deal is flexible, allowing for the modernisation of the Polish power sector.”

HISTORIC?

The economic crisis sweeping Europe has further complicated climate talks that had already raised tensions in a 27-member bloc embracing former Soviet bloc states besides western Europe.

German Chancellor Angela Merkel, who opposes the heavy spending advocated by Britain and France for fear it could lead to escalating budget deficits, said at the start of the summit she was nonetheless keen to seal a 200 billion euro ($260 billion) stimulus package, amounting to some 1.5 percent of GDP.

Luxembourg Prime Minister Jean-Claude Juncker said on Thursday evening he thought EU leaders would agree on the main lines of the economic package and the climate deal on Friday.

“The economic crisis will pass, the climate crisis will stay. We have to do something,” he told reporters.

Finnish Foreign Minister Alexander Stubb said Friday would bring a ‘historic decision’ on energy and climate change.

‘Europe is going to show the way,’ he said.

Several leaders stressed the need to maintain the EU’s ambitious targets; but Merkel, seeking to limit damage to industry, appeared to have secured compromises.

Steel, cement, chemicals, paper and other industries will be sheltered from the added cost of buying permits to emit carbon dioxide from the EU’s flagship emissions trading scheme (ETS), according to a draft text that formed the basis for talks.

“This covers about 90 percent of industry, and I don’t see any reason why Germany would not accept this proposal,” German conservative Peter Liese told Reuters. “I see it as a victory.”

British Green group member Caroline Lucas said the proposals represented ‘the lowest possible common denominator’.

‘The eyes of the world are on the EU. The EU’s credibility as a leading actor on climate change is in freefall. It’s not too late for heads of state and government to intervene and save face.’

EASE THE SHOCK

In their first session of the summit, leaders agreed in principle on a set of concessions to Ireland enabling Dublin to hold a second referendum by next November on the Lisbon treaty, intended to streamline EU decision making. The treaty was rejected at a first poll and needs approval from all states.

“There was no opposition, there was no objection, there was no veto,” one European official said. Another stressed that the agreement was only provisional and there would be talks on the details of the arrangements on Friday.

The Lisbon Treaty — successor to the defunct EU constitution — aims to give the bloc more weight in the world by creating a long-term president and its own foreign policy supremo.

EU leaders aim to agree how to reach targets of slashing carbon emissions by 20 percent by 2020 and winning 20 percent of the bloc’s energy from renewable sources such as wind and solar power by that date, ahead of global talks next year on a successor to the Kyoto agreement from 2012.

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PUBLISHED BY ‘THE FINANCIAL MIRROR’

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MARKETS CAN’T RULE THEMSELVES – A ‘made in the U.S.A.’financial crisis highlights the need for more global—and more robust—oversight

Posted by Gilmour Poincaree on December 11, 2008

December 2008 – february 2009

by Joseph Stiglitz – (*)

PUBLISHED BY ‘NEWSWEEK – Special Edition – ISSUES 2009’ (USA)

For years, there has been an ongoing discussion among world leaders and thinkers about deficiencies in the international financial architecture and about economic imbalances, GROUND ZERO - Wall Street exported troubles to the world; it needs world help to fix themincluding the widening U.S. trade deficit. Many worried about a disorderly unwinding of these imbalances. Nothing was done. We are now paying the price for our failure to act. Ten years ago, the fear was that financial turmoil in the developing world might spill over to the advanced industrialized countries. Today, we are in the middle of a “made in the U.S.A.” crisis that is threatening the entire world.

If we are going to address this worldwide crisis and prevent a recurrence, we must reform and reconfigure the global financial system. There are simply too many inter-dependencies to allow each country to go its own way. For example, the United States benefited from its export of toxic mortgages; had it not sent some of them to Europe via complex securitization, its downturn would have been far worse. But the resulting weaknesses in Europe’s banks are now ricocheting back to the United States.

Better regulation would have helped prevent such a situation. But the reform of the global financial system must go much further. For example, there must be better monetary-policy coordination around the world. Europe’s current slowdown is due in part to the fact that while the European Central Bank spent the past year focusing on inflation, the United States was (rightly) focusing on the impending recession. The resulting difference in interest rates led to a strong euro and weak exports. That hurt Europe. But a weak Europe eventually hurts the United States, as Europe is forced to reduce its imports of American goods. With better coordination, perhaps America would have been able to convince Europe of the risks of recession, and that would have led to moderation of Europe’s interest rates.

There is also a need for internationally coordinated stimulus programs to help jump-start growth. It is good news that China, the United States and Japan have now all instigated major programs of fiscal expansion. But they are of vastly different sizes, and so far, Europe’s is lagging behind. Its growth and stability pact imposes constraints that may have global consequences. Beyond this, confidence in financial markets will not be fully restored unless governments take a stronger role in regulating financial institutions, financial products and movements of capital. Banks have shown that they can’t manage their own risk, and the consequences for others have been disastrous. Even former Fed chairman Alan Greenspan, the high priest of deregulation, admits he went too far.

What we need now is a global financial regulatory body to help monitor and gauge systemic risk. If financial rules are allowed to vary too widely from nation to nation, there is a risk of a race to the bottom — some nations will move toward more lax regulation to capture financial business at the expense of their competitors. The financial system will be weakened, with consequences that are now all too apparent.

What should this” new set of global financial rules encompass? For starters, it should ensure that managerial incentive schemes are transparent and do not provide perverse encouragement for bad accounting, myopic behavior and excessive risk taking. Compensation should be based on returns not from a single year but over a longer time period. At the very least, we should require greater transparency in stock options, including making sure that they receive appropriate accounting treatment. And we need to restrict the scope for conflicts of interest — whether among rating agencies being paid by those they are rating, or mortgage companies owning the companies that appraise the properties on which they issue mortgages. We need to restrict excessive leverage, and other very risky behavior. Standardization of financial products would enhance transparency. And financial-product safety and stability commissions could help decide which products were safe for institutions to use, and for what purposes. We have seen what happens if we rely on bankers to regulate banking.

Beyond better global coordination of macroeconomic policy and regulation, there are at least two other actions governments should take. First, we need a reform of the global reserve system. More than 75 years ago, John Maynard Keynes, the greatest economist of his generation, wrote that a global reserve system was necessary for financial stability and prosperity; since then the need has become much more dire. Keynes’s hope was that the International Monetary Fund would create a new global reserve currency that countries would hold instead of sterling (the reserve of the time). Today, such a currency could be used to replace the dollar as the de facto reserve currency. Because it would not depend on the fortunes of any one country, it would be more stable. Supply could be increased on a regular basis, ensuring that reserves kept up with countries’ needs. Issuance could be done on the basis of simple rules—including punishment for countries that caused global weaknesses by having persistent surpluses. This is an idea whose time may have finally come.

The other major reform should be a new system of handling cross-border bankruptcies (including debt defaults by sovereign states). Today, when a bank or firm in one country defaults, it can have global ramifications. With various national legal systems involved, the tangle may take years to unwind. For example, the problems arising from Argentina’s 2001 default are still not resolved, and bankruptcy complications plagued South Korea and Indonesia during their crises a decade ago, slowing down the process of recovery. The world may soon be littered with defaults, and we need a better way of handling them than we have had in the past.

This crisis has highlighted not only the extent of our inter-dependencies but the deficiencies in existing institutions. The IMF, for instance, has done little but talk about global imbalances. And as the world has focused on problems of governance as an impediment to development, deficiencies in the IMF’s own governance meant its lectures had little credibility. Its advice, especially that encouraging deregulation, seems particularly hollow today. Many critics in Asia and the Middle East, where pools of liquid capital dwarf die IMF’s own, are wondering why they should turn over their money to an institution in which the United States, the source of the problem, still has veto power, and in which diey have so little voting power.

This is a Bretton Woods moment — a time for dramatic reforms of existing institutions” or, as was done at the end of World War II, the creation of new ones. Until now, Washington has consistently blocked efforts to create a multilateral global financial system that is stable and fair. It exported the deregulatory philosophy that has proved so costly, both to itself and to the world. President Obama has an opportunity to change all this. Much depends — now and for decades to come — on his response.

(*) – Joseph Stiglitz is a Nobel laureate in economics and a professor at Columbia University.

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INDITEX GANÓ 843 MILLONES EN LOS NUEVE PRIMEROS MESES, UN 2% MÁS – Las ventas crecieron un 11% entre febrero y octubre, y alcanzaron los 7.353 millones de euros, un incremento que, a tipo de cambio y perímetro constante, se eleva hasta el 14%

Posted by Gilmour Poincaree on December 11, 2008

11/12/2008 08:07

PUBLISHED BY ‘LA GACETA DE LOS NEGOCIOS’ (Spain)

Madrid. Inditex registró un beneficio neto de 843 millones de euros en los nueve primeros meses de su ejercicio fiscal, lo que supone un incremento del 2% respecto al resultado obtenido en el mismo periodo del año anterior, un 4% más a perímetro constante, informó hoy la compañía a la Comisión Nacional del Mercado de Valores (CNMV).

El grupo textil explicó que sus ventas crecieron un 11% entre febrero y octubre, y alcanzaron los 7.353 millones de euros, un incremento que, a tipo de cambio y perímetro constante, se elevó hasta el 14%.

La compañía precisó que, transcurridas seis semanas desde el inicio del cuarto trimestre del ejercicio 2008, las pautas de crecimiento son “similares a las del tercer trimestre”.

El margen bruto de la compañía avanzó un 12%, con lo que se situó en 4.235 millones de euros, y supuso el 57,6% de las ventas. El beneficio bruto de explotación (Ebitda) subió un 5% y se colocó en los 1.545 millones de euros, mientras que el beneficio neto de explotación (Ebit), por su parte, repuntó un 2%, hasta 1.132 millones de euros.

Crecer sin recurrir al endeudamiento

La compañía que preside Amancio Ortega destacó su “fuerte capacidad de generación de caja”, cuya posición neta se incrementó un 9%, hasta 525 millones de euros, lo que le permitió financiar su crecimiento “sin recurrir al endeudamiento”.

En los nueve primeros meses, el grupo abrió un total de 456 nuevas tiendas, 45 más que en el mismo periodo del año anterior, con una inversión de 806 millones. De esta forma, al cierre de octubre Inditex contaba con 4.147 tiendas en 71 países, 456 más que al inicio del ejercicio.

Apuesta por Asia y Europa del Este

Entre los mercados en los que se produjo un mayor incremento en la presencia comercial destaca Rusia, donde el número de tiendas casi se ha duplicado desde el inicio del ejercicio. Otras aperturas reseñables son la tienda Zara inaugurada en Tokio, con la que el grupo alcanzó los 4.000 puntos de venta, así como las primeras tiendas en Montenegro, donde el grupo ha lanzado simultáneamente las cadenas Zara, Pull and Bear, Bershka, Stradivarius y Oysho.

Por su parte, Uterqüe, cadena especializada en accesorios, alcanzaba un total de 24 tiendas a 31 de octubre, entre ellas las primeras en Portugal.

Asimismo, el grupo creó un total de 7.171 nuevos empleos en los nueve primeros meses, de forma que la plantilla de la compañía estaba integrada por 86.688 personas al cierre de octubre. (ep)

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Posted in ASIA, BANKING SYSTEMS, COMMONWEALTH OF INDEPENDENT STATES, ECONOMIC CONJUNCTURE, ECONOMY, EUROPE, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, GARMENT INDUSTRIES, INDUSTRIAL PRODUCTION, INDUSTRIES, INTERNATIONAL, JAPAN, REGULATIONS AND BUSINESS TRANSPARENCY, RUSSIA, SPAIN, STAGFLATION, STOCK MARKETS, THE FLOW OF INVESTMENTS, THE WORK MARKET | Leave a Comment »

OECD ADVISES CAUTION (Slovakia)

Posted by Gilmour Poincaree on December 11, 2008

8 Dec 2008

by Beata Balogová

PUBLISHED BY ‘THE SLOVACK SPECTADOR’

AMONG the members of a club comprising the world’s most developed economies, many are staring down the wrong end of a protracted recession, the likes of which they have not experienced since the early 1980s.

Over the next two years, 8 million people could join the ranks of the unemployed in the member states of the Organisation for Economic Cooperation and Development (OECD); at the same time, inflation is abating in all of them and some even face the risk of mild deflation, according to the OECD in its latest economic forecast.

Though Slovakia is forecast to remain the OECD’s top performer for the next two years, the organisation expects economic activity to decelerate significantly in 2009, before picking up in the following years.

“In particular, investment spending and trade growth are likely to be adversely affected by the effects of the financial crisis,” said the OECD in its economic outlook, which is published twice a year, analysing major trends and the economic policies required to foster high sustainable growth.

According to the OECD, Slovak growth is expected to return to close to its potential rate towards 2010. Inflation rates should decline from their currently high levels, but stay above euro-area levels, the organisation said. The OECD predicts economic growth in Slovakia to be 4.0 percent at most next year.

“Among the recently published prognoses, the OECD’s is the most pessimistic for Slovakia,” Zuzana Holeščáková, an analyst with Poštová Banka, told The Slovak Spectator. “The autumn estimate of the European Commission stood at 4.9 percent and the recently revised prediction of the Finance Ministry stands at 4.6 percent.”

Radovan Ďurana of the Institute of Economic and Social Studies (INESS), a think tank, said that Slovakia owes its ability to keep economic growth at the highest level among OECD members to foreign investments encouraged by the reforms adopted by the previous government.

“Currently there are no measures taken which would fundamentally influence the interest of investors in increasing their production in Slovakia,” Ďurana told The Slovak Spectator.

The relatively high economic growth should be still driven by domestic production; specifically household consumption, but also by the public administration and thanks to the creation of gross fixed capital, according to Holeščáková.

However, analysts also say that the slower growth of GDP will be reflected in slower growth in domestic consumption.

“The slowdown in economic growth due to the financial crisis should contribute to growing unemployment, a slower growth of salaries and a slowdown in inflation,” senior analyst with the VÚB bank Martin Lenko told The Slovak Spectator.

Holeščáková agrees that unemployment will now fall more slowly in Slovakia, which currently has one of the highest unemployment rates in the European Union.

In terms of foreign trade, the eurozone is Slovakia’s most significant market, but like other world economies it faces a slowdown in consumption and this fact will be reflected in the falling demand by foreign countries for Slovak products and services, which will mean a drop in exports, Holeščáková explained.

“Declining consumption might result in a slowdown of production and related limitations or even the closure of some operations,” Holeščáková said. “However, Slovakia should remain an attractive destination for foreign investors due to its lower costs, including cheaper labour.”

The OECD has also appealed to its member governments to support their economies with stimuli. As for which kind of stimuli these should be in Slovakia, Ďurana listed the “reduction of costs by which the government burdens the creation of jobs by businesses, and maintaining the volume of production”.

According to Ďurana, it should not be a policy of financial stimuli for selected sectors and companies but a flat reduction of the costs which the government itself has helped to cause.

“I am an advocate of revision of tax and payroll tax policies, which in a period of economic slowdown is one of the basic tools of the state to support investment and consumption, since it has a flat rather than just a selective impact,” Lenko told The Slovak Spectator.

Ďurana said that in Slovakia’s case the reduction of the tax and payroll tax burden and reduction of the administrative and regulatory burden would help.

According to Holeščáková, Slovakia should not be affected by the crisis to the same extent as some EU or other developed economies, while the Slovak government does not yet have to support the economy with different stimuli.

The OECD also asked member governments to be more watchful, which is very important in Holeščáková’s view.

“Mainly in the area of fiscal stimuli and due to excessive spending in the economy the public finance deficits could deepen but also the state debts could swell, which in some circumstances might result in Slovakia not fulfilling the [eurozone] stability pact,” Holeščáková said.

Handling the adoption of the euro, which is scheduled for January 1, 2009, will determine policy priorities.

Although the expected slowdown will dampen the danger of a boom-bust cycle induced by low real interest rates, fiscal policy should be used cautiously, the OECD said.

As for the role the euro will play next year in defining the government’s economic policies, Lenko said that the loss of the monetary lever, which in the past took the form of a strengthening Slovak crown, would create greater pressure to follow considerate fiscal policies, which should be targeted on achieving sustainable long-term development of the economy.

“Whether it happens this way all depends on the government,” Lenko said.

Ďurana said that the government should consider the monetary policy of the European Central Bank next year to be beyond its reach and it will be left with only fiscal policies to fight eventual inflationary pressures.

“Thanks to the euro, the Slovak currency, compared to the currencies of neighbouring countries, has significantly strengthened, which has increased wage expenses for foreign investors in Slovakia,” Ďurana said. “The government should compensate for this negative effect by cutting taxes and payroll taxes.”

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PUBLISHED BY ‘THE SLOVACK SPECTADOR’

Posted in CENTRAL BANKS, COMMERCE, ECONOMIC CONJUNCTURE, ECONOMY, EURO, EUROPE, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, INTERNATIONAL, NATIONAL WORK FORCES, ORGANIZATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENT (OECD), RECESSION, SLOVAKIA, THE FLOW OF INVESTMENTS, THE WORK MARKET, THE WORKERS | Leave a Comment »

BIG FOUR POISED TO TAKE OVER COMMERCIAL LENDING – The major Australian banks will be forced to shoulder a greater share of commercial lending, as international banks retreat from the domestic financing market (Australia)

Posted by Gilmour Poincaree on December 10, 2008

December 11, 2008

by Scott Murdoch – The Australian

PUBLISHED BY ‘THE AUSTRALIAN’

A report from Deutsche Bank has found that $84 billion worth of corporate debt is to be refinanced over the next two years, forcing company directors to examine their equity options.

The investment bank said in the first half of this year, the top four banks were responsible for half the new syndicated loan allocations.

The portion taken by the domestic banks was up from 34 per cent in 2007, after a marked contraction in activity by US and European banks.

So far this year, the European share has retreated from 34 per cent to 28 per cent, and US bank participation has more than halved from 14 per cent 6 per cent.

The report said since 2006, $280 billion worth of syndicated debt was raised in Australia, of which 60 per cent is held by offshore banks.

Deutsche Bank’s head of leveraged finance Marla Heller said the increase in corporate activity over the past two years had led to the significant amount of debt raisings.

“There has been growth from 2005 to 2007. A big driver of that is the private equity and the leveraged buyouts,” Ms Heller said.

“Also, from 2006 and 2007 there were a significant number of corporate refinancings.

“I think in the first half of 2008, we saw the retreat of foreign banks. The Australian banks will be more like the cornerstones.”

It has been estimated the most debt due to mature is held among real-estate investment trusts, utilities and infrastructure.

Deutsche predicts international banks will depart since the introduction of regulations requiring companies to have better financial coverage of their assets.

“It is hard to see the Australian banks having all of the capacity to fill the void,” Ms Heller said in reference to the retreat of foreign banks.

“We will see opportunities for other entrants coming in and that won’t be just the banks but private equity.

“I think corporates are going to have to look at how they support themselves from a capital point of view.”

Deutsche Bank’s managing director of global banking in Australia, David Backler, said there would be a growing role from private equity firms which, globally, are holding almost $1 trillion worth of cash.

He said: “There are going to be large effects with $84 billion worth of debt maturing. Where is that going to come from?

“We think that the Australian banks have a big job to do because of the foreign banks retreating.

“The offshore debt markets are challenged. That is going to lead people down the path of equity raisings and more private equity.”

Deutsche has forecast lending and refinancing deals will be structured differently in 2009, with fewer banks in large scale syndicates.

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PUBLISHED BY ‘THE AUSTRALIAN’

Posted in AUSTRALIA, BANKING SYSTEM - USA, BANKING SYSTEMS, CENTRAL BANKS, COMMERCE, ECONOMIC CONJUNCTURE, ECONOMY, ECONOMY - USA, EUROPE, FINANCIAL CRISIS - USA - 2008/2009, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, FOREIGN POLICIES, GERMANY, INTERNATIONAL, INTERNATIONAL RELATIONS, MACROECONOMY, RECESSION, REGULATIONS AND BUSINESS TRANSPARENCY, THE FLOW OF INVESTMENTS, USA | Leave a Comment »

CUBAN TOURISM SURGES AS REST OF CARIBBEAN STALLS – Tourism In Cuba Up Nearly 11 Percent Despite 3 Hurricanes

Posted by Gilmour Poincaree on December 10, 2008

HAVANA, Dec. 8, 2008

The Associated Press

PUBLISHED BY ‘CBS NEWS’ (USA)

(AP) Cuba’s vacation industry has remained as hot as the tropical sun here, even as the world economic crisis sparks cancellations and layoffs elsewhere in the Caribbean.

The communist country says it’s booked solid through December and expects a record 2.34 million visitors this year _ largely because global financial woes have so far been softer on Canada, its top source of visitors.

Luck also played a role: While the island suffered three devastating hurricanes, its key tourist sites were largely spared. And where beachfront resorts did get hit, the tourist-hungry government has made sure to repair hotels _ in some cases even before damaged homes and infrastructure. Tourism is Cuba’s second-largest source of foreign income, behind nickel production.

So while other islands in the region are laying off hotel workers and suspending construction of new property, Cuban resorts are gearing up for a strong season.

“We’ve had a few cancellations, but overall our numbers are still strong,” said David Gregori of WowCuba, a travel agency in Charlottetown, Canada, that specializes in bicycle trips and other Cuba tours. “People still like to get away. They might try to save some money while doing it, but they’re still traveling.”

The number of foreign visitors has swelled nearly 11 percent this year, making up for 4 and 3 percent declines in 2006 and 2007, government figures show.

Officials offer no explanation for those slower years. But tour operators blame the island’s low returning-visitor rates: Some tourists complain of poor service, crumbling infrastructure and lousy food, indicative of a communist system where shortages are common and state employees are unaccustomed to putting customer service first.

Still, the island is often cheaper than its subtropical neighbors, because many foreigners buy all-inclusive packages offering dozens of direct flights from Europe and Canada to airports all over Cuba, as well deep discounts on hotels, food and booze.

Others are enticed by the prospect of seeing one of only five communist countries left on the planet.

“A lot of people who are going for simple fly-and-flop holiday, and there are others who are going for history and culture, dancing, music,” said Julia Hendry, marketing director for Europe and the United Kingdom of the Bahamas-based Caribbean Trade Organization. Cuba has both, she said, “whether it’s swimming and beach or the excitement of Old Havana and Cuban history.”

About 35 percent of this year’s tourists have been Canadian, with 635,000 visiting through September, one-fifth more than in the same period last year. Canada’s economy has not suffered the same losses now sapping the savings of homeowners in the U.S.

Russian tourists rose 40 percent to top 28,000 thru September, and Cuban Tourism Minister Manuel Marrero traveled to Moscow last month to further promote his country.

Visitors from Britain, Italy, Spain and Germany, the top suppliers of tourists after Canada, declined between 3 and 5 percent respectively, however.

Washington’s trade embargo prohibits Americans from visiting, though island immigration records show about 41,000 came last year, many presumably without permission. But not relying on U.S. tourists may now be a blessing.

“Canadians are going to keep coming, especially with snow at home,” said Helen Lueke of Sherwood Park, Canada, who has vacationed in Havana about once a year for decades.

Alexis Trujillo, Cuba’s deputy secretary of tourism, predicted full bookings at least through next summer.

“There’s no doubt tourism is always sensitive to everything,” he said of global economic turmoil. “But we don’t think that for Cuba that will mean an important decrease.”

Tourism generated $2.2 billion for Cuba in 2007. The government has announced no plans to delay a $185 million plan to upgrade more than 200 resorts and build 50 boutique hotels by 2010 _ nt even after Hurricanes Gustav, Ike and Paloma hit within two months, causing more than $10 billion in damages and crippling farms and infrastructure across the countryside.

Construction crews assigned to vacation properties in Havana and elsewhere have largely continued working as normal since the storms.

In the eastern province of Holguin, the island’s No. 3 tourist destination after Havana and the beach resort of Varadero, officials prioritized hotel repairs, trucking in workers to rebuild beachfront resorts. Holguin expects about 270,000 foreigners this year, about the same as 2007, despite scores of hurricane-related cancellations.

Havana’s decaying yet picturesque historic district saw little damage, as did Varadero, 90 miles (140 kilometers) to the east, where white sand and warm, see-through surf has enticed everyone from Fidel Castro to Al Capone. A record million visitors are expected to stay in the town’s 7,000 hotel rooms, which range in price from about $120 to $350 per night, with meals and open bar included.

Though European tour operators say sales have slowed since the financial crisis deepened in October, they expect trips to Cuba and some other Caribbean destinations to stay strong through the winter. Europeans are putting off short, side trips closer to home, but many families are still willing to splurge on once-a-year trips to the tropics, Hendry said.

“We have noticed that all-inclusive markets, where travelers can budget in advance, seem to be doing relative well. Cuba is quite well-populated with that sort of property,” she said.

The industry could get another boast if President-elect Barack Obama keeps campaign promises to ease restrictions on Cuban Americans who want to visit their relatives on the island. Currently, those with family here can only come once every three years.

Nelson Gonzalez, a 56-year-old physical therapist, said his mechanic brother in Miami last came to visit in 2007. But his brother called the morning after the U.S. election to say he was reserving a seat on one of the many special charters that fly from the U.S. to Havana for the last week in January _ confident Obama will ease family travel rules immediately after his Jan. 20 inauguration.

“When your family members reach a certain age, you don’t know if in three more years everyone will still be here,” said Gonzalez, who lives with his 80-year-old parents.

Though visiting family members spend less than tourists, Gregori said many Cuban Americans use his company to book rental cars in advance of visiting relatives.

But “if you want to rent a car in Havana in December, I don’t have any,” he said. “They’ve been sold out for months, and every year they get sold out earlier and earlier.”

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PUBLISHED BY ‘CBS NEWS’ (USA)

Posted in BARACK HUSSEIN OBAMA -(DEC. 2008/JAN. 2009), CANADA, COMMERCE, CUBA, ECONOMIC CONJUNCTURE, ECONOMY, EUROPE, FINANCIAL CRISIS 2008/2009, FOREIGN POLICIES, FOREIGN POLICIES - USA, GERMANY, INDUSTRIES, INTERNATIONAL, INTERNATIONAL RELATIONS, ITALY, NATIONAL WORK FORCES, RECESSION, RUSSIA, SPAIN, THE LAST DAYS OF GEORGE WALKER BUSH - 2008/Jan. 2009, THE WORK MARKET, THE WORKERS, TOURISM INDUSTRIES, UNITED KINGDOM, USA | Leave a Comment »

EURO-ZONE’S TOP CENTRAL BANKER SAYS ECONOMY WOULD HAVE SLOWED WITHOUT FINANCIAL CRISIS

Posted by Gilmour Poincaree on December 9, 2008

Last update: December 8, 2008 – 10:58 AM

by Aoife White – Associated Press

PUBLISHED BY ‘THE STAR TRIBUNE’ (USA)

BRUSSELS, Belgium – Don’t blame the financial crisis for the current economic downturn, says the euro-zone’s top central banker.

European Central Bank President Jean-Claude Trichet said Monday the slowdown was inevitable after high growth in recent years and a spike in oil prices that sent inflation soaring and braked business activity and household spending.

“Even without the financial crisis we would have had a slowing down in the economy after long years of very active growth at the global level and after the oil shocks that we had to cope with,” Trichet told the European Parliament’s economy committee in Brussels.

“That had a very powerful depressive effect on every economy in the world,” he said.

Oil prices hit a new record of $147 a barrel in July as demand for energy grew rapidly in emerging economies such as China and Brazil while suppliers remained tight. Prices have since sunk by two-thirds to hit a four-year low of $40.50 on Friday on worries of a world downturn.

The United States entered a recession last December, joined by the 15 nations that use the euro in the second quarter. Job losses are mounting and will likely rise further in coming months.

Trichet acknowledged that “exceptional tensions in the financial sphere” that froze bank lending had worsened the downturn.

He said the euro-zone central bank expects the global economy and “very sluggish” household demand to remain weak in the next few quarters — warning that a fragile recovery could be damaged by worse financial turmoil, protectionism and sudden changes to global account deficits.

He called on European governments to move fast to restore confidence in the banking sector by pushing forward with banking rescue plans that should ease lending. France said Monday it would start a recapitalization program within days after it won EU approval to give out large subsidies to banks.

Trichet did not give any hint of a future interest rate cut that would bring euro borrowing costs below the current 2.5 percent. The ECB reduced rates from 3.25 percent last week as falling inflation gave it more room to stoke growth in a slowing economy.

Economists speculate that the ECB may cut rates again in January to 2 percent. That would match current rates charged by the Bank of England and Sweden’s Riksbank.

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PUBLISHED BY ‘THE STAR TRIBUNE’ (USA)

Posted in BANKING SYSTEM - USA, BANKING SYSTEMS, BRASIL, CENTRAL BANKS, CHINA, COMMERCIAL PROTECTIONISM, DEPRESSION, ECONOMIC CONJUNCTURE, ECONOMY, ECONOMY - USA, EUROPE, FARMING SUBSIDIES, FINANCIAL CRISIS - USA - 2008/2009, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, INTERNATIONAL, MACROECONOMY, RECESSION, STOCK MARKETS, THE EUROPEAN UNION, THE FLOW OF INVESTMENTS, THE LAST DAYS OF GEORGE WALKER BUSH - 2008/Jan. 2009, USA | Leave a Comment »

NO ROOM FOR WISHFUL THINKING – THE SLUMP IS HERE WITH A VENGEANCE (USA)

Posted by Gilmour Poincaree on December 9, 2008

Saturday December 6 2008

by Larry Elliott, Economics Editor – The Guardian

PUBLISHED BY ‘THE GUARDIAN’ (UK)

The shocking jobs data from the US yesterday should remove the last doubt about the potential of the current crisis to turn into the most serious economic shock to the global economy since the 1930s.

The fact that the world’s biggest economy shed 533,000 jobs last month smacks of a slump. While it is unlikely to prove as long and as deep as the Great Depression, more jobs were lost last month than at any time since 1974, when the decision by Opec to turn off the oil taps brought the postwar boom to a shuddering halt.

To make matters worse, the jobless figures for September and October were revised sharply higher so that payrolls were down by 1.25 million over the latest quarter.

Some analysts saw hope in the fact that the unemployment rate rose only modestly from 6.5% to 6.7%. But that was because more than 400,000 people left the labour force altogether last month, presumably on the grounds that there was no prospect of finding work.

Nor was this a temporary shakeout precipitated by the collapse of Lehman Brothers. Revisions to the back data show payrolls were down by more than 400,000 in September, before the escalation in the financial crisis had any effect.

Apart from any impact on shares, bonds and the dollar, yesterday’s woeful jobs data will have three consequences. If 1.25 million people suddenly stop earning a wage, there will be an impact on consumer spending. And if consumers are not spending, companies are not going to invest – even assuming that they can get the finance. We are likely to see output contract at an annual rate of about 4% in the fourth quarter – and it could be even worse. And what happens to America matters to everybody else, especially the big exporting nations: China, Germany, South Korea, Japan.

The second effect will be social. America does not have the generous welfare nets enjoyed in Europe, so unless those made jobless can quickly find work, there will be hardship, poverty and the threat of disorder.

The need to put people back to work leads to the third consequence. There will be further interest rate cuts by the Federal Reserve and other “unconventional” measures to drive down long-term rates. There will be suggestions that America can’t wait for the $500bn fiscal stimulus the president-elect is planning. And there will be help for the motor industry. One of the few Americans likely to have found hope in yesterday’s report will be Rick Wagoner, the boss of General Motors.

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PUBLISHED BY ‘THE GUARDIAN’ (UK)

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INTERFAITH DIALOGUE, HYPOCRISY AND PRIVATE LIVES (Lebanon)

Posted by Gilmour Poincaree on December 8, 2008

Monday, December 08, 2008

Talal Nizameddin wrote this article for THE DAILY STAR (Lebanon)

PUBLISHED BY ‘THE DAILY STAR’ (Lebanon)

First person by Talal Nizameddin

I am suffering from a total state of agnosia. Is this the same Michel Aoun who angrily vowed that he would break the head of the Syrian regime? Is this the same Syrian regime that pacified the Lebanese Army soldiers fighting under Aoun’s command and waged a ruthless campaign for 15 years to marginalize the idealistic Free Patriotic Movement supporters? At least I am almost sure that I haven’t been afflicted by amnesia. I remember when the Lebanese felt the thrill of defiance when they beeped their car horns driving through the Nahr al-Kalb tunnel leading to Jounieh from Beirut.

Letting bygones be bygones and forgiveness is a treasured feature of human nature and being an optimist, I say whatever breaks the ice and allows people to move on from a painful past should be welcomed with open hearts. But the process of forgiveness is a long and arduous one. In Judaism, Christianity and Islam it must begin with honesty, leading to confession and then as a final step absolution becomes meaningful. On a human level, in a one-to-one conflict, a discussion must take place that expresses the pain of each side so that there is an understanding of the hopes and fears of the other side before saying sorry reaches a level beyond words and touches the human within us.

It is said that since the end of the Cold War we have been living in the age of the clash of civilizations and the dialogue of faiths. In the Western and pro-Israeli media, Islam is the culprit, with the image of bloodthirsty mad Muslims rampaging through Mumbai killing randomly all those around them the latest episode of terror that does nothing to the great religion they claim to be fighting for. Among Arabs and Muslims it is the Jews who have manipulated the Holocaust tragedy to inflict suffering on Palestinians and Arabs. The Christian West is also blamed for a low-burning decadence that over time has led to the collapse of the world financial markets due to greed and the neglect of the poverty and misery of the so-called Third World.

What is strikingly noticeable about Aoun’s visit is the tour of the historic churches of Syria. The message clearly states that Christianity is safe from the harm of Muslim fanatics in secular Syria. But the manipulation of the clash of civilizations idea has been even better fine-tuned because there is now a distinction between Sunni Islam and Shiite Islam that has been dispersed in our media outlets like a wave of cluster bombs. Thus we have inter and intra-civilization clashes if we are to believe our political experts and TV commentators. Aoun and his supporters have played further on Lebanese Christian emotions, maliciously highlighting the difference between the Shiites, true Lebanese patriots who are fighting Israeli occupation and the Sunnis, bad people who are paid by the Saudis to turn Lebanon into a Wahhabi extension. Even by local standards Lebanese politics has descended to a truly low level.

In fact, the Saudi monarch courageously endorsed a United Nations gathering to promote dialogue among the world’s great religions despite criticisms from no other than Aoun and his comrades in March 8. Despite the good intentions, the Saudis may however be wasting their time. By entering into such discussions the world risks mirroring the same Lebanese facade that religious belief somehow lies at the source of conflict. It evades the powerful economic explanations and the fact that there is a huge gap in wealth between states and between individuals in the world we live in. It also, and just as importantly, diverts attention from the lack of representation, the lack of personal freedoms and the lack of human rights most people in the world endure on a daily basis. Blatant injustice, economic and political, creates extremism and not religions.

The West should not feel too self-satisfied about its state when there are calls for more social justice and greater freedoms. In Britain, as an example of an advanced European country, the state has been shown to fail time and time again in protecting children with one in four children according to a recent study suffering from sexual abuse. Crime is rampant and ethics are barely visible in the business and political realms. As in the United States, a philosophy of “grabbing hands grab what they can” has reigned for decades. Support for oppressive regimes, particularly here in the Middle East, is justified in the name of good diplomacy but the arming of parties fuelling regional conflicts is also considered good business sense.

If most sensible people agree that finding a solution to the Palestinian problem, which has nothing to do with religion, will make the Middle East and the world a better place, why on earth has it been so difficult for the world’s only superpower to convince Israel to accept a neighboring viable Palestinian state on the West Bank and Gaza? If the United States is truly a democracy, then I must concur with the people I despise the most, the religious fanatics, that blaming the elected leader of the United States is futile because the American people must shoulder their moral responsibility to force their government into a strategic change in their approach. The Palestinian-Israeli conflict is a political problem with a human dimension. It is simply about national self-determination and not religious fanaticism or civilizational clashes. Palestinians and Jews belong to the same religious family chart, whether they like to admit or not although undoubtedly their historic experiences have diverged.

Nowhere has the mythology of sectarian and religious warfare been more prevalent than in Lebanon. I am still surprised how many Western observers take for granted the cliches about Muslim-Christian divisions characterizing Lebanese society. In reality, Lebanon is more of a clan-based system, with chiefs of clans or communities often but not necessary being defined by their religious beliefs. It just so happens that the sect is an important form of self-identification that is manipulated for conflicts, whether it is over land or political power. That is why within Lebanese sects there are often more than one chief. Take the Maronites as an example of multiple chiefs or zaims, Suleiman Franjieh, Samir Geagea, Michel Aoun, Amin Gemayel and Dori Chamoun all godfathering their own loyal communities. Even the ideological Hizbullah recognizes the need to respect the independence of the unruly clans of Baalbek in return for acknowledgement.

In Lebanon inter-communal relations and divisions are far more complex than simple religious divides. The downside of this system is that the individual is forced into belonging into a clan, because the collective of clans are far more powerful than the formal state. Only the community can protect the individual. In Lebanon, individuals do not have private lives, as is the case in the West, because they are the property of the family, the village, the community. The pattern is the same among all of Lebanese sects. But then again, free from the regional political conflicts, the interference from outside and the flaws in the internal political system, why should we accept that the community is a lesser entity than the state in its value?

Some Western political theorists have even called for a return to communalism as a result of the social failures of the modern state. The Lebanese model offers the opportunity of creating a political system that safeguards communities and also protects the rights of individuals living within them because the hypocritical and simply false pretense of a unified centralized state has been unworkable and shows no signs of succeeding. The Lebanese want their personal liberty, social justice and their community at one and the same time. It is no easy task but where there is a will there is a way and Lebanon could present the world with an example to be emulated around the world. Lebanon’s greatness and loyalty from its citizens could be reinforced by the historic achievement of harmonious and fraternal communal cohabitation. The first step is liberation from the old slogans and working for the common good without playing on communal fears to achieve personal ambitions. When a zaim such as Aoun tours with an open heart the various neighborhoods of Beirut rather than the churches of Syria we would have began reaching the final step toward that sacred goal.

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PUBLISHED BY ‘THE DAILY STAR’ (Lebanon)

Posted in AL QAEDA, CHRISTIANISM, EUROPE, FOREIGN POLICIES, FOREIGN POLICIES - USA, FREEDOM OF SPEECH AND CONSCIENCE, HISTORY, HUMAN RIGHTS, INTERNATIONAL RELATIONS, ISLAM, JUDAISM, LEBANON, PALESTINE, RELIGIONS, SAUDI ARABIA, SYRIA, THE ISRAELI-PALESTINIAN STRUGGLE, THE LAST DAYS OF GEORGE WALKER BUSH - 2008/Jan. 2009, THE LEBANESE CIVIL STRUGGLE, THE MEDIA (US AND FOREIGN), THE UNITED NATIONS, UNITED KINGDOM, USA, WARS AND ARMED CONFLICTS | Leave a Comment »

IRAN TESTS NEW MISSILE FROM WARSHIP: REPORTS

Posted by Gilmour Poincaree on December 8, 2008

Sun Dec 7, 1:52 am ET

Reporting by Hashem Kalantari, writing by Edmund Blair

PUBLISHED BY ‘YAHOO NEWS’ (USA)

TEHRAN (Reuters) – Iran’s military test-fired a new surface-to-surface missile from a warship as part of exercises along a strategic shipping route, state media reported on Sunday.

Iran launched six days of naval war games on Tuesday in the Sea of Oman and the Gulf region amid tension with the United States and Israel, which have not ruled out military action if diplomacy fails to end a row over Tehran’s nuclear work.

Iran has said that, if pushed, it could close the Strait of Hormuz at the entrance to the Gulf and through which about 40 percent of the world’s traded oil passes.

“The surface-to-surface Nasr-2 missile was tested in the (Sea of) Oman operational region,” state radio reported, adding that the test took place on Saturday.

“The Nasr-2 was fired from a warship and hit its target at a distance of 30 km (19 miles) and destroyed it,” the official news agency IRNA said, adding it was the first test of the new, medium-range missile.

The West accuses Iran of seeking to build nuclear warheads, a charge Tehran denies. It insists that it wants to master nuclear technology to generate electricity so that it can export more of its huge oil and gas reserves.

Washington, which has its navy Fifth Fleet based in the Gulf Arab state of Bahrain, has pledged to keep shipping lanes open. Experts say Iran’s navy would be no match for U.S. technology but could still create havoc in the waterway.

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PUBLISHED BY ‘YAHOO NEWS’ (USA)

Posted in ECONOMIC CONJUNCTURE, EUROPE, FINANCIAL CRISIS 2008/2009, FOREIGN POLICIES, FOREIGN POLICIES - USA, INDUSTRIAL PRODUCTION, INTERNATIONAL, INTERNATIONAL RELATIONS, IRAN, RECESSION, THE ARMS INDUSTRY, THE LAST DAYS OF GEORGE WALKER BUSH - 2008/Jan. 2009, USA, WAR EXERCISES | Leave a Comment »

SHARING THE RESPONSABILITY

Posted by Gilmour Poincaree on December 7, 2008

DECEMBER 3-8, 2008

by Michael Levitin

PUBLISHED BY ‘NEWSWEEK’ – Print Edition – (USA)

He was Chief of Staff to Chancellor Gerhard Schröder, the leading voice behind 'A BIGGER BREAK' - Frank-Walter Steinmeier says the crisis forced the U.S. to leave behind its traditions - Photo by Hans-Christian Plambeck (Laif-Redux)Germany’s refusal to fight in Iraq. Now German Foreign Minister Frank-Walter Steinmeier is the Social Democratic Party candidate for chancellor in next year’s elections, running against the popular Christian Democrat incumbent, Angela Merkel. In his first major interview with the U.S. press, Steinmeier sat down with NEWSWEEK’s Michael Levitin to discuss German troop engagements in Afghanistan, Russia’s recent aggression, the global financial crisis and how Germany might work alongside the United States. Excerpts:

LEVITIN: The day after Barack Obama won the U.S. presidency, Russian President Dmitry Medvedev threatened to install missiles in Kaliningrad if Washington did not “rethink” its deployment of a NATO missile shield in Eastern Europe. Did Moscow’s latest show of aggression shift the dynamic between Russia and Europe? How should you respond- and what should Europe’s response be?

STEINMEIER: Medvedevs announcement the day after the elections was clearly the wrong signal at the wrong time. We have no illusions about Russia. In the last few years it has often proved itself a difficult partner. The question remains how to deal with this huge country in Europe’s immediate neighborhood; having to choose between containment versus engagement, I advocate the latter. We must try to develop relations with Russia that go beyond economic interests and contribute to increased stability and security. After all, it is in our own interest to make sure that a Russia that is looking for its own identity is politically and culturally anchored in die West.

LEVITIN: Do you see Germany as a middleman, acting as a buffer between Russia and the rest of Europe-perhaps at the moment even Russia’s closest EU ally?

STEINMEIER: Russia is aware of our uniquely close relationship with the United States. We are firmly embedded in NATO and the EU and thus we don’t aspire to play the role of a middleman. Together with our European partners we showed a strong and outspoken response to Russia’s role in the conflict in Georgia. I think Europe’s united voice no doubt contributed to the military conflict ending. Now the stabilization of the region as a whole has to continue, and for genuine stability we need Russian cooperation. As for energy links between the EU and Russia, the answer depends on which European country you talk to. But in general, Russia depends as much on Europe and America buying its goods as we rely on Russia supplying us with natural gas and oil. As far as Germany is concerned, it is little known in the United States that we have worked successfully for decades to diversify our suppliers of various forms of energy and fuels, with Russia but also Norway and Africa being important suppliers.

LEVITIN: You mentioned the conflict In Georgia. Should that country and Ukraine be Invited to Join NATO?

STEINMEIER: This is not a simple yes-or-no decision. With national elections looming, the domestic situation in Ukraine has changed, as has the situation in the Caucasus since the conflict broke out this summer. Yes, we remain committed to supporting and assisting these countries on the road ahead. But concerning the Membership Action Plan, Germany and other European governments continue to stand by their position.

LEVITIN: The most urgent U.S. foreign-policy question involving Germany, which Obama raised many times during his campaign, is Afghanistan and whether Germany will contribute more troops there to stabilize the south. How much is your country willing to sacrifice for this partnership, putting its soldiers into harm’s way?

STEINMEIER: I have spoken to Barack Obama twice, and from these exchanges I know that he sees Afghanistan in a very nuanced way. I feel we see eye to eye in our assessment that we’re facing a very difficult security situation, but that military means alone cannot bring about the necessary changes. Our approach has to be a comprehensive one, and contrary to what some people may say, Germany has played its part.

LEVITIN: In the north, certainly. But It’s in the south where the greatest violence has taken place, and where Obama’s asking for greater German participation.

STEINMEIER: We have shouldered our share of the military responsibility and we have also enlarged our engagement. We are about to increase our troops by 30 percent, to 4,500. We are participating in aerial surveillance across the whole of Afghanistan, including the south, and German radio engineers are also stationed in Kandahar. The German Air Force runs flights for all NATO countries throughout Afghanistan, again including the south. We took over the lead of the Quick Reaction Force in the north. And let us not forget that circumstances there have also changed; the north, too, has seen its share of armed opposition activities increasing in the last month. But our engagement in Afghanistan is about much more than military action. We have always said that we will only be successful if we succeed in helping rebuild the country and its economy. Civil reconstruction is the second important pillar of our engagement on the ground, and we’ll continue to increase our contribution in this area next year.

LEVITIN: Given the turmoil in Pakistan, what do you think the next steps forward ought to be?

STEINMEIER: The security of the whole region strongly depends on Pakistan. If we want to combat terrorism in Afghanistan, we have to succeed in stabilizing Pakistan politically and economically. This calls for a strengthened Pakistani commitment to combat terrorism, but it also calls for international assistance for this country. It needs a substantial loan from the IMF. We also need to be ready to help stabilize the country in a lasting way.

LEVITIN: On Iran, what realistic hopes do you see of bringing Mahmoud Ahmadinejad to the table and persuading him to give up Tehran’s nuclear ambitions? And how far will you be willing to push?

STEINMEIER: No doubt there is hope in the international community that after 29 years of standstill, a new approach may be possible. We all remember the reasons for the break-off of relations between the U.S. and Iran. Since then, U.S.-Iranian relations have also been a story of missed opportunities: when Washington signaled openness, Tehran wasn’t willing or able to respond in kind, and vice versa. I think it would be worthwhile trying to have direct talks, but the Iranians have to know it is up to them to prove they do not aspire to nuclear weapons-and that they’re willing to play a constructive role in the region. I have to admit I am skeptical, and can only express my hope that the leaders in Iran seize this opportunity.

LEVITIN: Turning to the financial crisis, the banks got a bailout. Now the automobile manufacturers are seeking the same thing. How do you see EU countries regaining their competition policy-and their legitimacy-after this?

STEINMEIER: I believe the politicians would have lost their legitimacy if they hadn’t acted. What we’re facing here is the very visible failure of the market. We had to make sure that the crisis in the financial markets does not lead to a total breakdown of the financial system as a whole. On both sides of the Atlantic, unconventional means were applied to manage the crisis. Honestly speaking, many of the measures taken in the U.S. seemed a bigger break with American tradition than can be said about European measures.

LEVITIN: How important is it that developing countries play a greater decision-making role In the future? For example, we saw hints of the G8 expanding into a G20 several weeks ago in Washington.

STEINMEIER: What is the most fundamental challenge the world is facing today? To my mind, it consists of integrating the emerging powers of the 21st century into a system of shared global responsibility. I am talk ing about countries like China and India, but also Muslim states such as Saudi Arabia. Can any of the global challenges we face be tackled without them? I don’t think so. That is why we have to make them stakeholders, and in that respect the recent financial summit in Washington was historic. To me it is obvious we cannot stop there.

PUBLISHED BY ‘NEWSWEEK’ (USA)

Posted in 'DOHA TALKS', AFGHANISTAN, AFRICA, BARACK HUSSEIN OBAMA -(DEC. 2008/JAN. 2009), CHINA, COMMERCE, COMMODITIES MARKET, DEFENCE TREATIES, ECONOMIC CONJUNCTURE, ECONOMY, ECONOMY - USA, ENERGY, ENERGY INDUSTRIES, EUROPE, FINANCIAL CRISIS - USA - 2008/2009, FINANCIAL CRISIS 2008/2009, FOREIGN POLICIES, FOREIGN POLICIES - USA, G20, G8, GEORGIA, GERMANY, INDIA, INDUSTRIAL PRODUCTION, INDUSTRIAL PRODUCTION - USA, INDUSTRIES, INDUSTRIES - USA, INTERNATIONAL, INTERNATIONAL RELATIONS, IRAN, ISLAM, MILITARY CONTRACTS, NATO, NATURAL GAS, NORWAY, PAKISTAN, PETROL, RECESSION, RUSSIA, SAUDI ARABIA, THE ARMS INDUSTRY, THE EUROPEAN UNION, THE FLOW OF INVESTMENTS, THE LAST DAYS OF GEORGE WALKER BUSH - 2008/Jan. 2009, THE OCCUPATION WAR IN IRAQ, THE UNITED NATIONS, USA, WAR IN AFGHANISTAN, WARS AND ARMED CONFLICTS | 1 Comment »

ALCOA SCRAMBLES TO STAY VIABLE

Posted by Gilmour Poincaree on December 6, 2008

Thursday, December 4, 2008

By The Wall Street Journal

PUBLISHED BY ‘THE PITTSBURG-TRIBUNE REVIEW’ (USA)

Alcoa Inc., which had been Alcoa Warrick Operations employee of 36 years Fred Westbrook, 59, of Evansville, Ind. inspects the finished rolls of aluminum as they comes off the last stage of the production line in this April 7, 2006, at the Alcoa Warrick Operations in Newburgh, Ind. (AP Photo/ Daniel R. Patmore, File)counting on obtaining discarded aluminum assets from a merged BHP Billiton and Rio Tinto PLC, has fewer strong options to improve its prospects amid one of the worst aluminum markets in decades now that the deal has collapsed.

With aluminum inventories just shy of record levels, prices at their lowest level in 2008 and nearly half of the world’s aluminum production unprofitable, Alcoa is scrambling to cut capacity and find buyers for some of its downstream businesses, which is proving more difficult given the tight capital markets and reluctance of many companies to take on debt.

Neither of those efforts, however, addresses the company’s fundamental challenge: Alcoa remains the high-cost producer of the world’s major aluminum makers when compared with Rio Tinto’s Alcan and Russia’s United Co. Rusal. Knowing that BHP wasn’t keen on the aluminum market, Alcoa had been hoping to buy all or part of Alcan, which has lower energy costs, after BHP bought Rio Tinto.

With that prospect off, speculation is mounting that Alcoa will look at other avenues.

“Everybody understands the current economic situation in the world” requires certain steps, said Alcoa spokesman Kevin Lowery. “In the interim, we are taking steps to reduce costs and taking steps to position ourselves so we will be stronger than competitors. That is what we are focusing on.”

John Tumazos, an analyst with Very Independent Research, said the company has few good options as its influence in the commodities world is nowhere as solid as it once was. “They need to idle more smelters than they have cut,” he said.

So far, Alcoa is keeping a lid on its options, but industry observers say it could deepen its existing relationship with its partner Aluminum Corp. of China, also known as Chinalco. The two companies own a 9 percent stake in Rio Tinto that they jointly purchased for $14 billion in January. The stake is valued at about 80 percent less since BHP’s planned takeover of Rio collapsed last month.

Alcoa could increase its existing stake, betting on a rise in commodity prices. It could sell its stake, which would bring about $200 million in cash to its coffers and represent a huge loss from its initial $1 billion investment.

The two companies could combine into a single entity. Such a deal, while in no way an easy task because it would result in Chinese ownership of a key U.S. company, could work for both sides. A combined Alcoa and Chinalco would make it one of the biggest producers of aluminum and both alumina and bauxite, necessary ingredients for aluminum production.

In addition, a combined company would be able to better rationalize expensive smelters and other production facilities in Europe, the United States and China, leaving just the lowest-cost facilities to compete with Rio Tinto and UC Rusal.

Tumazos said Alcoa’s sagging stock price, which is hovering around $10, makes the company a fairly inexpensive purchase. “Chinalco could buy Alcoa for about $8 billion plus a premium,” he said. “That is less than it paid for a stake in Rio.”

CLICK HERE FOR THE ORIGINAL ARTICLE

PUBLISHED BY ‘THE PITTSBURG-TRIBUNE REVIEW’ (USA)

Posted in ALUMINUM, CHINA, COMMERCE, COMMODITIES MARKET, ECONOMIC CONJUNCTURE, ECONOMY, ECONOMY - USA, EUROPE, FINANCIAL CRISIS - USA - 2008/2009, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, HOUSING CRISIS - USA, INDUSTRIAL PRODUCTION, INDUSTRIAL PRODUCTION - USA, INDUSTRIES, INDUSTRIES - USA, INTERNATIONAL, METALS INDUSTRY, MINING INDUSTRIES, RECESSION, STOCK MARKETS, THE FLOW OF INVESTMENTS, THE WORK MARKET, THE WORKERS, USA | 1 Comment »

PROTECTIONISM REARS ITS HEAD AS WTO TRIES TO WRAP UP DOHA – CONGRESSMEN TELL BUSH TO REJECT TABLED TRADE DEAL – SUMMIT TO END SEVEN YEARS OF TALKS PUT IN DOUBT

Posted by Gilmour Poincaree on December 5, 2008

Thursday December 4 2008

by Larry Elliott, Economics Editor – The Guardian

PUBLISHED BY ‘THE GUARDIAN’ (UK)

A sign that the current crisis is fanning a desire for protectionism emerged yesterday when members of Congress warned George Bush against trying to fast-track a trade deal for the end of the year.

Pascal Lamy, director general of the World Trade Organisation, is considering calling trade ministers to Geneva to conclude the Doha liberalisation talks.

“Unfortunately, the negotiating texts currently on the table would provide little if any new market access for US goods, and important advanced developing countries are demanding even further concessions from the US,” said a bipartisan letter from Charles Rangel, Max Baucus, Jim McCrery and Charles Grassley. Democrats Rangel and Baucus chair the Ways and Means and the Finance committees respectively, while McCrery and Grassley are the ranking Republican members.

“We see no tangible progress, and in fact believe that some of our trading partners have become even further entrenched in their unacceptable positions.”

Lamy wants to bring more than seven years of acrimonious talks to an end with a meeting next weekend, after last month’s summit of G20 leaders in Washington instructed trade ministers to settle differences over agriculture and manufactured goods. Some officials believe it would become more difficult to conclude any deal once Barack Obama is sworn in next month.

WTO sources last night talked of a meeting on December 13, although Lamy was more cautious. In a fax to the WTO’s 153 members, he said he had yet to decide whether there had been enough progress since talks broke down in July: “As we all know, we still have a number of outstanding issues. But the reality is the relevance of what we are doing to the financial crisis,” he said. “If we fail we have a problem; but although there remains the risk of failure, the risks involved in not trying are higher.”

He is concerned that economic distress in the US, Europe and Asia is already prompting countries to use protectionist weapons yet to be outlawed by the WTO – raising tariffs to the maximum permitted, and introducing anti-dumping regulations.

US agriculture secretary Ed Schafer said he was confident a deal could be done, and confirmed that Washington was ready to make a big cut in its agreed ceiling for agriculture subsidies if other countries opened their markets further to US farm produce. “We in the US remain confident we can see a successful completion to the Doha round this year,” he told reporters in Beijing.

However, the Congressmen warned Bush against being rushed into a deal that would be rejected on Capitol Hill. “We strongly urge you not to allow the calendar to drive the negotiations through efforts to hastily schedule a ministerial meeting, without adequate groundwork having been laid.

“Developed and advanced developing countries must commit to provide meaningful new market access opportunities if Congress is to support a deal.’

“Achieving the necessary flexibility from our trading partners could require new thinking … and our negotiators should be given time to explore such options. Otherwise, the likely result will be a deal that Congress cannot support – an outcome that would be detrimental to US farmers, workers and firms, the global economy, and the WTO itself.”

Amy Barry, trade spokeswoman for Oxfam, said: “This round of talks was meant to be primarily about development, not about market access for US farmers and companies. Yet Oxfam is hearing that the US, with tacit support from the European Union, Australia and others, has now put extra demands on the table, mostly about further prising open the markets of major emerging economies.

“These come as China has seen a major fall in its exports, leading to many enterprises closing and huge numbers laid off to go back onto the land … India has lost 20% of its exports in a year, with 1.2m job losses in textiles and clothing alone … It is difficult to understand why anyone would seriously expect China and India to agree to yet more trade concessions.”

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PUBLISHED BY ‘THE GUARDIAN’ (UK)

Posted in 'DOHA TALKS', AGRICULTURE, CHINA, COMMERCE, COMMERCIAL PROTECTIONISM, COMMODITIES MARKET, ECONOMIC CONJUNCTURE, ECONOMY, ECONOMY - USA, EUROPE, FARMING SUBSIDIES, FINANCIAL CRISIS 2008/2009, FOREIGN POLICIES, G20, G8, INDIA, INDUSTRIAL PRODUCTION, INDUSTRIES, INTERNATIONAL, INTERNATIONAL RELATIONS, RECESSION, REGULATIONS AND BUSINESS TRANSPARENCY, THE EUROPEAN UNION, THE LAST DAYS OF GEORGE WALKER BUSH - 2008/Jan. 2009, USA, WORLD TRADE ORGANIZATION | 1 Comment »

NEW GAS EXPORT STRATEGIES (Iran)

Posted by Gilmour Poincaree on December 3, 2008

Thu, Dec 04, 2008

by Majid Karimi

PUBLISHED BY ‘THE IRAN DAILY’

The trilateral meeting between the leaders of Turkmenistan, Turkey and the Republic of Azerbaijan was held at It is difficult to predict the final stance of Turkmenistan toward the Nabucco pipeline, as nothing official has yet been made public.Turkmanbashi, Turkmenistan, on Friday.

Gurbanguly Berdymuhammedov, Abdullah Gul and Elham Aliev respectively discussed cooperation in the field of energy.

The meeting followed Berdymuhammedov’s visit to Germany and Austria, and negotiations for exporting gas to Europe. Of course, he has not made explicit comments regarding exports of gas to Europe via Nabucco or the trans-Caspian project.

The trans-Caspian project has not yet materialized due to ambiguities surrounding the Caspian legal regime, rift between Turkmenistan and Azerbaijan over a gas field and environmental problems.

Diversification

After the Turkmanbashi meeting, Financial Times reported Azerbaijan and Turkmenistan have reached an agreement about new strategies for exporting the Caspian Sea energy to consumer markets to curb the dependency of European states on Russian gas.

Based on this report, the European Union (EU) and the US have urged Turkmenistan to join the Nabucco pipeline project for transporting gas via Azerbaijan, Georgia and Turkey.

After meeting his Azeri counterpart, Berdymuhammedov said, “Turkmenistan and Azerbaijan, which are rich in hydrocarbon resources, have reached an agreement on diversifying the export routes for energy to the global markets.“

He emphasized that his country is keen on participating in the Nabucco pipeline project, but is under pressure for exporting its gas via Russia, which is the main market for Turkmen gas.

“Turkmenistan has signed a contract for supplying gas to China via the pipeline which is presently under construction,“ he said.

On the threshold of this trilateral meeting, Berdymuhammedov visited Germany and Austria during Nov. 13-19. In these visits, issues pertaining to the transport of Caspian Sea gas bypassing Russia were examined.

Manager of Azerbaijan’s Oil Projects Research Center Ilham Shaban noted that negotiations between the presidents of Azerbaijan, Turkey and Turkmenistan hints at more extensive cooperation among them in the energy sector than the Nabucco project alone.

Future meetings are not expected to focus on the gas project for building a pipeline through the Caspian seabed because at the presidential level, projects in their preliminary stages are not examined.

“So far, a few meetings have been held between representatives of Turkey and Turkmenistan in which the import of electricity and transport of gas via Iran were discussed. But, the last case did not materialize,“ he said.

The Azeri official noted that till now, no trilateral meeting was held between the leaders of Azerbaijan, Turkmenistan and Turkey.

“I should mention a similar case regarding how things proceeded regarding energy cooperation between Azerbaijan and Kazakhstan. Since November 2002, negotiations took place between Baku and Astaneh at different levels. This eventually led to an intergovernmental agreement between Azerbaijan and Kazakhstan regarding oil transport via the Baku-Tbilisi-Ceyhan pipeline. Hence, the meeting in Turkmenistan is another step to this end,“ he said.

Since the Commonwealth of Independent States gained their independence in 1991, Azerbaijan has had good economic ties with Turkmenistan and Turkey.

“I personally believe that in future negotiations between the presidents of these countries, more issues will be examined,“ he said.

Shaban further said it is difficult to predict the final stance of Turkmenistan toward the Nabucco pipeline, as nothing official has yet been made public, except a communiquŽ expressing Turkmenistan’s desire to diversify its gas supply.

“Interestingly enough, it has been mentioned that gas will be transported to China from fields located above Amudarya, from northern Dolatabad to Russia via the pipeline alongside the Caspian Sea and whatever is found in the western part of Turkmenistan will be transported to the West,“ he said.

It seems that Turkmenistan has determined, after 17 years of independence, where and how gas should be transported in a viable manner.

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PUBLISHED BY ‘THE IRAN DAILY’

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ECONOMIC STIMULUS PLANS SPRING UP AROUND WORLD

Posted by Gilmour Poincaree on December 3, 2008

Published Tuesday, December 2, 2008

THE WASHINGTON POST

PUBLISHED BY ‘THE OMAHA WORLD-HERALD’ (USA)

WASHINGTON — In a bid to jump-start the beleaguered global economy, countries around the world are introducing massive public spending programs aimed at creating millions of jobs, boosting the use of green energy and modernizing infrastructure in a way that could transform urban and rural landscapes.

The viability of some of the plans remains unclear. But observers say the number of countries moving in tandem underscores the perceived severity of the coming global recession and the view that governments must at least temporarily pick up the slack as the hard-hit private sector sheds jobs and cuts spending.

It is time “to invest massively in infrastructure, in research, in innovation, in education, in training people, because it is now or never,” French President Nicolas Sarkozy said in a recent public address.

World leaders are pursuing various strategies to tame the economic crisis, including moves to unclog credit markets, strengthen financial institutions and ease monetary policy. But fiscal stimulus packages, in particular, have emerged as a favorite tool of policymakers.

Worldwide, economists say, the increase in public spending, if executed wisely, could add as much as 1 percent or 2 percent to global growth next year, perhaps easing recessions in the United States, Europe and Japan while cushioning the slowdown in the developing world, which until recently had seen red-hot growth.

Yet if the promise of combating a global recession with public funds is big, so too, experts say, is the danger that billions worth of taxpayers dollars could be spent in vain.

Analysts point out that the pitfalls of growth-by-spending were exposed by Japan, which launched a huge infrastructure program in the 1990s. To spur expansion after stock market and real estate crashes, the Tokyo government spent billions on new public works projects.

Those projects not only failed to prevent a decadelong economic slump but also produced a herd of white elephants that included new, but little-used, airports and ports, as well as a $250 million bridge to Kourijima Island. Population: 361.

“There is a huge danger of bridges to nowhere, and as Japan showed us, that is no way to get out of a recession,” said Grant Aldonas, a former high-level Bush administration trade official and a senior fellow at the Center for Strategic and International Studies.

While China and Japan enjoy a surplus of reserves, spending increases will drive the United States, Britain and many other European countries deeper into debt. The cost of raising cash on world markets by some rich nations, such as Ireland, has surged as investors grow increasingly skeptical of their fiscal health, limiting their options to spend more now.

“In normal times, we would be telling countries, ‘Please reduce your debt,'” said Olivier Blanchard, chief economist at the International Monetary Fund, which has taken the unusual step of calling on nations to raise public spending by 2 percent of gross domestic product to combat a global recession. “But these are not normal times.”

A snapshot of how governments plan to increase spending is emerging. Those plans include not only the building of more bridges and roads but also the introduction of measures to put more cash into the hands of strapped consumers.

In the United States, the Federal Reserve and Treasury Department have moved to boost consumer spending and lower home mortgage rates, committing as much as $800 billion to make it easier for Americans to borrow money for cars, tuition and homes.

The British said they would slash the national sales tax from to 15 percent from 17.5 percent. The Germans are set to offer temporary tax incentives to consumers buying cars or renovating homes. The Japanese are giving out cash rebates to taxpayers.

Some of the projects being proposed are pre-existing infrastructure plans that are being accelerated. Nicholas Lardy, a senior fellow at the Peterson Institute for International Economics, estimates that only about half the “new projects” in Beijing’s $586 billion package amount to previously unplanned spending. “But that is still a great deal of money,” Lardy said.

A number of countries are gearing up for projects that offer long-term benefits, both economic and environmental.

In a move that may offer a guide to helping the ailing Big Three automakers in Detroit, the French are in the early stages of plans to assist their hard-hit auto industry by awarding government grants to boost research into hybrid and battery-power technology.

In comments last week, president-elect Barack Obama suggested that an expansion of wind and solar power generation would be part of his stimulus plans. Obama also cited a plan being circulated by environmental groups that would offer government loans to help schools update their heating and cooling systems, creating quick construction jobs and stimulating demand for building materials.

“I think the fervor in which (the Obama team) is seeking suggestions right now tells me that this kind of spending is something they are very serious about,” said Carl Pope, executive director the Sierra Club.

Some countries in Europe, such as Germany, appear more concerned about overspending. That is at odds with the leadership in France, where Sarkozy has seen the crisis as an opportunity to boost the role of government.

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ARAB ECONOMIES TO GROW DESPITE SETBACKS

Posted by Gilmour Poincaree on December 2, 2008

December 1, 2008 at 9:10 AM EST

OXFORD ANALYTICA – Exclusive – PUBLISHED BY ‘THE GLOBE AND MAIL’ (Canada)

SUBJECT: The impact of the world economic downturn on Arab economies.

SIGNIFICANCE: In contrast to the severity of the downturn in other parts of the world, the Arab world appears likely to experience relatively moderate losses. However, certain countries may be particularly vulnerable.

ANALYSIS: The IMF’s latest downward revisions of growth rate projections for 2009 place Arab countries in third place at 5.3 per cent after China and India at 8.5 per cent and 6.5 per cent respectively, although World Bank figures are somewhat less optimistic. Positive growth prospects reflect two key factors:

Macroeconomic fundamentals are positive, in particular the prospects for sustained investment growth, which will be driven by accumulated oil revenues and continuing oil incomes.

Regional capital markets, which have been hit by the crisis, are among the smallest and least significant in emerging markets.

Investment. Buoyant investment activity is now and will continue to be supported by oil income and wealth: The current account surplus of oil economies is expected to double to some $132-billion (U.S.) in 2008 against $77-billion in 2007.

Arab sovereign wealth funds possess at least $1.53-trillion in assets, with considerably more in reserves and accumulated private wealth.

Despite the slashing of oil revenues due to the present fall in oil prices, accumulated assets are likely to make up the difference from a regional standpoint – although particular countries may suffer.

Intra-Arab foreign direct investment has been rising steadily, from $8.8-billion between 1985-1995, to nearly $17-billion between 1995-2002, to $77-billion between 2002-07, with $14-billion in 2007 alone: FDI accounts for 12 per cent of regional capital formation compared to 7.8 per cent in developing countries as a whole.

GCC investors are now investing around 25 per cent of their oil wealth in the region compared to 15 per cent in 2003.

In oil, gas and energy, $520-billion worth of projects are planned for 2009-2013, down from a projected $650-billion before the crisis; even if only $400-billion worth are financed, $8-billion to $10-billion a month of investment will take place.

The crisis in Europe and the United States will strengthen the need for geographic diversification, and will confirm intra-Arab investments as a key category in Arab portfolios.

Investors will likely diversify away from real estate and tourism into other sectors such as food, transport, and medical diagnostics.

There have been official promises to maintain intra-Arab capital and investment flows, although the use of resources in domestic bailouts may limit the fulfilment of such commitments.

Market losses. The four largest markets – Dubai, Egypt, Kuwait, and Saudi Arabia – have lost up to half of their value, mirroring heavy losses elsewhere. Another four markets – Abu Dhabi, Bahrain, Qatar, and Oman – registered relatively moderate losses of 20-40 per cent. All had fallen from historical highs in summer, 2008.

There are a number of channels of contagion from global financial markets:

Exits by non-Arab investors have most seriously affected the more open Arab stock markets, namely those of Egypt and the United Arab Emirates.

Exposure to the US prime and sub-prime markets has affected players in Kuwait, Qatar and the UAE.

A more significant channel is heightened fear and uncertainty about the unfolding global recession; the region’s markets, whose trends have been dominated by excitement and herd behaviour, joined the global panic.

Negative sentiment overwhelmed the effects of positive fundamentals, including the strong results of many listed corporations for the first half of 2008.

Mitigated impact. Yet there are good reasons to believe that the falls in Arab markets will be less enduring, and have less negative broader impact, than in markets elsewhere:

The fall in OECD financial markets is the most severe in decades; in contrast, wild swings in the region are common.

Arab stock markets are highly volatile, narrow and illiquid; only a small proportion of total capitalization is traded.

The dominance of financial institutions in market indices made their fall in the present crisis inevitable; financials constitute 56 per cent of the S&P’s Pan Arab index, compared to 16 per cent in the Latin America index and 36 per cent for Africa.

Remarkably, the four smallest markets – Beirut, Jordan, Morocco, and Tunis – retained gains, indicating that intra-Arab investments have constituted a successful portfolio diversification strategy.

Arab markets are still constructing operational and regulatory structures. Gaping holes remain in corporate governance rules and practices, and the culture of retail investors is still underdeveloped. In 2007-2008 a series of investigations targeted insider dealings and share manipulation. Fines were handed to listed firms, brokers, and investment companies in Jordan, Egypt, UAE, Saudi Arabia, and Oman. However, the relative unsophistication of markets and their lesser significance in the broader economies has shielded Arab countries from the worst effects of the financial crisis.

Slowdown. The downside risks are not to be underestimated in a deep and complex world crisis: Oil revenues will be dented by declining world demand, forcing oil-rich countries to engage in belt-tightening and possibly threatening FDI flows to other Arab countries.

The cost of finance, in terms of spreads, has already risen to all-time highs, and all types of capital raised are below 2007 levels.

Falls in exports will cause losses across the region; many once-booming industries such as petrochemicals and fertilizers are now faced with sliding markets.

Falls in tourism will hit players such as Morocco, Egypt, and Dubai; falls in remittances will hit North African countries.

Dubai’s fall is likely to be the sharpest, linked as it is to the bursting of an enormous real estate bubble; mortgage lending had quintupled in the last five years, and government debt is high at around $70-billion.

Egypt, which is poor and heavily indebted, is likely to be hit hard by declines in the stock market, oil and gas income, and Suez revenues; even a moderate downturn is likely to feed growing public discontent.

CONCLUSION: Losses on Arab stock markets have wiped out abnormally high returns, but not the prospects of solid positive returns. The region is finally drawing on what has long underpinned East Asian and European growth: domestic and intra-regional investment. Supported by ample reserves and SWF resources, this strength should help the region to weather a world recession. Growth prospects are therefore dented, but remain positive.

From the Oxford Analytica Daily Brief

Copyright 2008 – Oxford Analytica Ltd. All rights reserved.

Founded in 1975, Oxford Analytica’s 1,000+ analysts provide international organizations with monitoring, research and consultancy services that explore the strategic implications of policy, economic, financial, industry, trade and security developments around the world.

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FOR A BETTER FINANCIAL ORDER – Chinese leaders and scholars suggest reforms to strengthen the international financial system

Posted by Gilmour Poincaree on November 26, 2008

November-26-2008 NO. 48 NOV. 27, 2008

by Ding Ying

As the international financial crisis plunges many countries into economic turmoil, China’s relatively stable economic growth is reassuring to the international community.

As a result, the world is paying more and more attention to China’s opinions about the ongoing crisis and possible solutions. Chinese leaders and economists recently made a series of suggestions for reforming the current international financial system.

China’s efforts

Chinese President Hu Jintao participated in the Group of 20 (G-20) Summit on Financial Markets and the World Economy held on November 15 in Washington, D.C., where he delivered a speech calling for international cooperation to get through this “difficult moment.”

In his speech, Hu clearly stated the Chinese stance on international financial reform. “Reform of the international financial system should aim at establishing a new international financial order that is fair, just, inclusive and orderly and fostering an institutional environment conducive to sound global economic development,” he said.

The Chinese Government has taken many measures to safeguard economic development and financial stability. After the crisis began, China made timely adjustments to its policies and strengthened macroeconomic regulation, Hu said. These adjustments included lowering the bank required reserve ratio, lowering interest rates and easing corporate tax burdens. Hu also promised to play a “constructive role” in restoring the international financial system and suggested four key reforms: increased international cooperation in financial supervision, reform of international financial organizations, increased regional financial cooperation and diversification of the international monetary system.

As the world’s most populous developing country, China would make an important contribution to international financial stability and world economic growth simply by maintaining steady economic growth, the president said. Several days before the summit, China announced a 4-trillion-yuan ($586 billion) economic stimulus plan. Observers believe that the plan, which concentrates on stimulating domestic consumption in China, may restore confidence in world economic development.

In a November 16 Xinhua report, Chinese Foreign Minister Yang Jiechi outlined five achievements that came from Hu’s participation in the financial summit. First, he met with other G-20 leaders to discuss the root causes of the financial crisis and possible solutions and reforms, which they described in a joint statement. Second, Hu introduced measures the Chinese Government has taken to safeguard economic growth and financial stability. Third, he helped guide the direction of international financial reform. Fourth, Hu called for international efforts to help developing countries. Finally, Hu promoted China’s bilateral relationships with several countries by meeting with their leaders during the summit.

Cooperation, not competition

Chinese economists also had opinions on the current world economic situation. They provided suggestions for reforming the international financial system and maintaining economic and financial stability in China.

Zhang Ming, a researcher from the Institute of World Economics and Politics, Chinese Academy of Social Sciences, said in World Affairs on November 16 that there were resemblances between the current international economic and financial situation and the Great Depression. The U.S. dollar has been greatly weakened by the subprime mortgage crisis, but the euro is struggling as well. “The supreme financial structure is on the edge of collapse,” he said.

The countries affected by the crisis have two options, Zhang said. One is to unite and cope with the crisis together by building new international financial and monetary systems, which could cushion the U.S. dollar’s fall. The other is for each country to look out for itself, which might cause discord and competition among the largest economies and lead the dollar system to collapse completely.

“The latter way further undermines the global economic and financial order. Then a new crisis, or even wars, will break out,” said Zhang, arguing the world must join hands to deal with the current financial crisis.

Regarding international monetary reform, independent economist Xiang Songzuo said in Elite Reference on November 16 that there is little possibility the International Monetary Fund will be recast as the world’s central bank. Instead, the crisis might cause new regional currencies to emerge. “Influential currencies, like the euro, yen and the renminbi, can play an important role in stabilizing regional economies,” he said.

Su Jingxiang from the Center for Globalization Studies, China Institutes of Contemporary International Relations, said in People’s Daily that since the financial sector is the weak point of the Asian economy, Asian countries must enhance both regional and global cooperation. He said that based on the foreign reserves held by China, Japan, South Korea and ASEAN members, Asia could become a leader in international financial fields. “Only through strengthened cooperation can China protect its interests well and perform its function better in the international cooperative system,” Su said.

“China’s top priority is to deal with the crisis with caution and run its own business well,” said Xiang Lanxin, an observer of world affairs, in Global Times. Xiang urged China to promote domestic demand over exports in its response to the crisis. Massive exports could push other countries into trade protectionism and make China a target of international criticism.

Highlights of the G-20 Financial Summit

Leaders attending the G-20 financial summit agreed on an action plan to combat the current financial crisis on November 15 in Washington, D.C. After discussing the reasons behind the current crisis, the leaders issued a statement pledging to “enhance our cooperation and work together to restore global growth and achieve needed reforms in the world’s financial systems.”

The leaders agreed that the current financial system has vulnerabilities such as weak underwriting standards, unsound risk management practices, increasingly complex and opaque financial products, and consequent excessive leverage.

Further, inconsistent and insufficiently coordinated macroeconomic policies, inadequate structural reforms and unsustainable global macroeconomic outcomes are the combined elements that resulted in the current financial crisis.

The leaders stressed that free market principles, including the rule of law, respect for private property, open trade and investment, competitive markets, and efficient, well-regulated financial systems, are essential to economic growth.

They vowed to take “strong and significant actions” to reform current financial systems, stimulate their economies, provide liquidity, strengthen the capital of financial institutions, protect savings and deposits, address regulatory deficiencies, unfreeze credit markets and ensure that international financial institutions can provide critical support to the global economy.

The plan is based on five principles: strengthening transparency and accountability, enhancing sound regulation, promoting integrity in financial markets, reinforcing international cooperation and reforming international financial institutions. The principles have been broken down into immediate and medium-term actions to be taken by March 31, 2009.

The leaders also agreed to meet again by April 30, 2009, to review the plan’s implementation.

(Source: Xinhua News Agency)

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PIANO ANTI-CRISI: TAGLI ALLE RATE DEI MUINTERVENTI SU TARIFFE, ENERGIA E CARBURANTITUI,

Posted by Gilmour Poincaree on November 22, 2008

di Luca Cifoni

ROMA (22 novembre) – Bonus per le famiglie a basso reddito, ma anche interventi su carburanti, bollette energetiche, tariffe autostradali. E mutui, la cui riduzione potrebbe rientrare negli impegni presi dalle banche in cambio dei nuovi finanziamenti offerti dallo Stato. È ad ampio raggio il pacchetto famiglie che il governo sta mettendo a punto e che verrà approvato venerdì 28. Lo slittamento di due giorni, rispetto alla data prevista di mercoledì, è dovuto all’esigenza di coordinare i provvedimenti italiani con quelli che saranno proposti dalla Commissione europea proprio mercoledì; in particolare per quanto riguarda il rilancio degli investimenti in infrastrutture, che è al centro anche del piano di Bruxelles. Ieri il ministro dell’Economia ha illustrato al presidente Napolitano le grande linee del decreto.

L’obiettivo di tutti gli interventi destinati alle famiglie è naturalmente risollevare i consumi in particolare nel periodo natalizio. Dunque si punta a dare un po’ di soldi da spendere ai nuclei a reddito più basso, e allo stesso tempo a ridurre l’importo di alcune spese fisse sostenute da tutti. A partire da quelle energetiche. In questo, a dire la verità, la difficile fase economica paradossalmente aiuta. A causa delle prospettive di recessione il prezzo del barile è ormai arrivato intorno ai 50 dollari, e quello della benzina alla pompa si è adeguato scendendo a 1,17 euro al litro, il livello più basso dal novembre 2005. A partire dall’8 dicembre e fino al 6 gennaio, il governo potrebbe mettere di suo una riduzione temporanea delle accise, ottenendo quindi un prezzo ancora più basso. E di riduzione delle accise, piuttosto che di blocco delle tariffe, si parla anche relativamente alle bollette di elettricità e gas. In questo caso, dato il meccanismo “ritardato” di formazione dei prezzi, il calo del greggio avrebbe iniziato a farsi sentire nei prossimi mesi. L’ipotesi è che il governo lo anticipi con il proprio intervento fiscale, a partire dal mese di gennaio, per poi lasciare che il prezzo si stabilizzi ad aprile quando le accise sarebbero riportate al loro livello attuale.

Quanto alle tariffe autostradali, l’idea è invece un intervento diretto per congelare possibili aumenti futuri. Questa possibilità ha provocato ieri a Piazza Affari un tonfo di Atlantia, che controlla autostrade per l’Italia. Il blocco però non riguarderebbe l’incremento che la società ha in programma per il prossimo gennaio (pari a circa il 2,5 per cento). Nel mirino ci sono piuttosto aumenti più sensibili che sarebbero stati richiesti dal gruppo Gavio. La linea dell’esecutivo, enunciata dallo stesso ministro Tremonti, è legare qualsiasi incremento della tariffe agli investimenti effettivamente realizzati dal concessionario.

C’è poi la partita dei mutui. Anche in questo caso le famiglie italiane dovrebbero beneficiare a partire dai prossimi mesi della riduzione dei tassi Euribor in corso dalla metà di ottobre. In campo c’è anche la convenzione con l’Abi, che prevede la possibilità di ridurre le rate in cambio di un sostanziale allungamento della durata del prestito. Finora però questa formula non ha avuto troppo successo tra i risparmiatori. Siccome i tassi praticati dalle banche non si possono ridurre per legge, si è fatta strada l’ipotesi di inserire questo tema nelle nuove norme per il sostegno alle banche. Com’è noto, le banche le cui obbligazioni perpetue saranno sottoscritte dal Tesoro dovranno aderire ad un codice etico. Il quale dovrebbe prevedere, oltre alla garanzia di non far mancare in credito alle imprese, anche un impegno a ridurre gli spread a vantaggio delle famiglie, eventualmente anche adottando come base il tasso di riferimento della Bce invece che l’Euribor. Dalle banche per ora non arriva una conferma a questo scnario, mentre gli istituti avrebbero offerto al governo proprio una proroga della attuale convenzione.

Confermate le misure a favore delle imprese, anche se il taglio degli acconti dovrebbe riguardare Ires e Irap ma non l’Irpef.

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EL DÓLAR PIERDE SU ATRACTIVO – La debilidad del billete verde convierte al euro en la moneda favorita de modelos, deportistas y altos ejecutivos a nivel internacional, que ya quieren cobrar sus honorarios en divisa europea.

Posted by Gilmour Poincaree on November 21, 2008

Domingo, 11 de Noviembre de 2007, número 394

por María Canales

El dólar está de capa caída. Desde hace un tiempo, los fajos de billetes verdes están dejando de acumularse en las cajas fuertes. Su valor ya no es el que era. Incluso los grandes bancos centrales del mundo, como el de China, han empezado a cambiar parte de sus reservas de dólares por euros. La divisa, considerada por muchos años una de las más fuertes en los mercados internacionales y un valor refugio, ha visto cómo el euro le ha superado por mucho en los últimos años. Mientras que en julio de 2002, las cotizaciones de la moneda europea y la estadounidense estaban igualadas, el viernes, un euro se pagaba al récord histórico de 1,46 dólares.

Poco a poco, y según los expertos, el euro se está convirtiendo en la moneda favorita no sólo de los inversores, sino también de los ejecutivos, de los deportistas de élite, de los actores y de las modelos a nivel internacional, que ven que es más rentable cobrar en moneda europea.

Así lo manifestaron la semana pasada fuentes cercanas a la modelo brasileña Gisel Bündchen, la mejor pagada del mundo, con unas ganancias de 30 millones de euros (20,5 millones de euros) hasta julio de 2007. Según el semanario brasileño Veja, Bündchen habría pedido a la estadounidense Procter&Gamble cobrar sus honorarios en euros por ser la imagen de su filial de productos para el cabello Pantene. Y lo mismo habría exigido a los italianos Dolce&Gabana por promocionar su perfume.

La supermodelo no es la única que vela por hacer caja en euros. Según el departamento de prensa de la PGA (Asociación Profesional de Golf), en los últimos dos años ha aumentado en un 30% el número de golfistas estadounidenses, australianos y latinoamericanos que participan en el circuito europeo. Jugadores famosos como el estadounidense Scott Verplank -estuvo entre los 20 primeros del mundo- han pasado de jugar de manera permanente uno o dos torneos en Europa en una temporada, a siete. Se gana más dinero.

La Asociación de Tenistas Profesionales (ATP) trata desde hace años de proteger tanto a los jugadores como a los torneos ante las fluctuaciones de las divisas poniendo premios de similar valor, según Jorge Salked, agente del jugador español Tommy Robredo. «Hay que recordar que hace unos años la cosa estaba al revés, el dólar valía mucho más». Los grandes torneos asiáticos pagan en dólares, y algunos como el de Dubai -el que más reparte en premios, 1,4 millones de dólares, después de los cuatro Grand Slam y los nueve Masters Series-, se quedan cortos al convertir los cheques a los ganadores en euros. Al cambio, Dubai reparte 976.000 euros, sólo 300.000 más que el Conde de Godó en Barcelona.

Al futbolista David Beckham no le importa cobrar billetes verdes, aunque cuando firmó el contrato para jugar en el equipo de Los Angeles Galaxi el verano pasado exigió que se le pagara en dólares la misma cantidad que cobraba en el Real Madrid en euros (cerca de ocho millones netos).

Por puro «sentido común», la subida del euro tendrá también su efecto en el sueldo de los altos ejecutivos, según los expertos. «No cabe duda de que si esto se mantiene será algo que se demande por parte de los directivos, sobre todo de nueva contratación. Los expatriados, los embajadores, etcétera serán los primeros en pedir sus sueldos en moneda europea cuando sus puestos estén fuera de la zona euro», asegura Begoña Benito, socia directora general de la consultora Watson Wyatt. Según Benito, será un tema en el que ganen las dos partes, por convertirse en un incentivo de compensación.

La caída del dólar está afectando también a los resultados de empresas. El viernes, Repsol YPF anunció que su beneficio neto de 2.448 millones de euros en los nueve primeros meses del año había caído un 7,7% respecto al mismo periodo de 2006, debido en parte a la depreciación del dólar frente al euro. Por su parte, el consorcio aeronáutico EADS apuntó que su facturación registrará una leve reducción al cierre del ejercicio en comparación con 2006.

¿Cotizará el barril de brent algún día en euros?

En los últimos días, la cotización del euro frente al dólar y la del crudo han batido nuevos récords. Mientras que la divisa europea alcanzó los 1,47 dólares, el barril de Brent rebasaba los 95 dólares y se acerca peligrosamente a la cifra psicológica de los 100 dólares. Sin embargo, el propio Banco Central Europeo reconocía esta semana que un euro tan fuerte suavizaba la subida del crudo.

En los últimos cinco años, el dólar se ha devaluado más de un 30% con respecto al euro. Y el precio del petróleo ha pasado de los 22,6 dólares de noviembre de 2002 a los 95 actuales. Devaluando este precio un 30% resultaría el equivalente a 66,5 dólares de principios de 2006, por lo que la gran parte de esta subida, según los expertos, sería debida a la pérdida de valor del dólar contra el euro y no a problemas de suministro.

La posibilidad de que el petróleo cotice en euros en lugar de en la moneda estadounidense es algo que viene de largo y que muchos países de la OPEP llevan tiempo pidiendo. De hecho, Irán ya vende crudo en euros a China.

Sin embargo, esta iniciativa, de momento, es bastante inalcanzable, según los analistas. «Pese a la presión política para cambiar la referencia del crudo a otra moneda, el tema no es tan fácil. Además de que el coste sería enorme, se da la circustancia de que la profundidad del mercado en dólares es muy superior al mercado en euros», afirma José Luis Martínez, estratega de Citigroup. «Una cosa es que la moneda se aprecie y otra distinta es que la moneda siga siendo fuerte. El dólar continúa siendo una moneda fuerte en términos de intercambio. La gente va todavía a Oriente Medio con dólares, no con euros. Tiene aún valor como moneda refugio, como moneda de reserva, de intercambio. Además, la oferta de dólares tiene entre otras cosas razón de ser en la fuerte demanda de activos internacionales de la economía americana. Es decir, consumen muchos productos asiáticos y crudo, por lo que hay una correspondencia entre la oferta y la demanda de dólares», asegura Martínez.

El experto cree que hoy no hay un mercado lo suficientemente profundo que sustituya al dólar.

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UE DESCARTA REDUÇÃO DE INVESTIMENTOS EM BIOCOMBUSTÍVEIS – Para o bloco, a meta de uso de um quinto de energia renovável até 2020 é essencial para a Europa

Posted by Gilmour Poincaree on November 20, 2008

19 de Novembro de 2008

Eduardo Magossi/Agência Estado

O comissário da UE (União Européia) para Energia, Andris Piebalgs, disse nesta quarta-feira (19) em São Paulo que o bloco não deverá reduzir seus investimentos e suas metas de utilização de combustíveis renováveis em função da atual crise econômica. Segundo ele, a meta de uso de um quinto de energia renovável até 2020 é essencial para a Europa, não apenas política e economicamente, mas também como forma de garantir o suprimento energético necessário.

Piebalgs participou nesta quarta (19) de coletiva de imprensa na sede da Unica (União da Indústria da Cana-de-Açúcar) após reunir-se com representantes do setor sucroalcooleiro do Brasil. O comissário é responsável pela Diretiva Européia Sobre Fontes Renováveis de Energia, documento que reúne critérios que devem ser adotados para garantir a produção e suprimento de biocombustíveis na Europa. As metas da Diretiva se estendem até 2020.

O documento ainda será votado pelo Parlamento Europeu, o que deve acontecer em 8 de dezembro. Se aprovado, a principal meta é reduzir as emissões de gás carbônico em 20% até 2020. Nesta redução, 10% deverão vir do setor de transporte. Segundo o comissário, a maior parte da redução do setor de transporte deve acontecer pela utilização de biocombustíveis, embora não existam metas especificadas para etanol, biodiesel ou carros movidos a bioeletricidade. A segunda meta é de que 20% da energia utilizada pela Europa seja substituída por uma fonte renovável.

Piebalgs disse que os critérios adotados pela Diretiva não dão margem para questionamentos sobre barreiras não tarifárias. “Estive reunido com analistas brasileiros e nenhum deles levantou a possibilidade de que os critérios propostos pela UE possam gerar algum painel na Organização Mundial do Comércio”, disse. Ele também afirmou que a União Européia não terá condições de atender toda a demanda por biocombustível que será gerada com a aprovação da Diretiva. Ele acredita que 20% dessa demanda deverá ser importada e que o Brasil poderá ser uma fonte se atender a todos os critérios de sustentabilidade contidos na Diretiva. “O Brasil é um país responsável e sério e tem se mostrado capaz de garantir o desempenho sustentável do setor sucroalcooleiro.”

O comissário disse, contudo, que a Diretiva não tem nenhum poder sobre as tarifas existentes hoje sobre o biocombustível importado, mas essa discussão sobre tarifas pode ganhar maior relevância na rodada de Doha na OMC após a crise financeira mundial. Para ele, a energia renovável pode ser uma forma de alavancar a economia européia através de novos investimentos. Ele citou estudo recente da Organização Internacional de Energia que estima que o preço do barril do petróleo deverá ficar, em média, em US$ 100 no período de 2008 a 2015.

Unica

Antes da coletiva, o presidente da Unica, Marcos Jank, havia dito que a UE precisa definir com urgência uma política de matriz energética de longo prazo, englobando biocombustíveis, com a participação institucional do Brasil. Segundo ele, esta política deve ser baseada em critérios de sustentabilidade na produção e também no uso de biocombustíveis, que atendam às expectativas tanto dos produtores dos combustíveis alternativos como de exploradores de petróleo, refinadores e governos.

Jank afirmou que a visita do comissário é importante porque o parlamento europeu deve decidir até 8 de dezembro sobre a aprovação da Diretiva Européia sobre Fontes Renováveis de Energia, que propõe que os biocombustíveis utilizados na Europa emitam pelo menos um índice 35% inferior de gás causadores do efeito estufa em relação à gasolina e que sejam produzidos de forma sustentável.

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OPINION: KEEPING GOOD COMPANY (Libya)

Posted by Gilmour Poincaree on November 17, 2008

15/11/2008 14:37:00

by Zainab Al-Arabi

The bad news is that although certain events in a country might make people depressed because they KEEP GOOD COMPANYhave no control over them in the Third World, of which we are a part, the good news is that this doesn’t just occur in Third World countries who are always lectured at by First World countries about their economy, society, health, food, religion, etc. If anything the past couple of years have shown us that we are in good company.

Thanks to the oh-so-free press in the West – which is increasingly becoming more of a voice for certain corporations- we learnt belatedly of secret prisons in Europe, Pakistan, and Afghanistan where innocent Muslims were kept and tortured. We were informed –better late than never- of the complicity of human-rights-respecting Western governments in these dastardly events.

In Third World countries these wouldn’t have been so secret; everyone would know because of the idle time citizens have on their hands spent in fruitless conversation. And having relatives and neighbours in secret security services (again in Third World countries) helps to keep information flowing – who needs newspapers? A proud mother will tell her entire neighbourhood that her son is in ‘security’, and he can be observed sometimes showing his ‘secret’ I.D. at the bank to people so he can jump the queue.

Mismanagement of government files and losing classified information? Yes that too is presented as evidence of Third World incompetence, but should we complain about this accusation when a leading First World country has shown us that this is an everyday occurrence? I mean if British ministers and state officials leave classified information on bus seats and in car parks, then where is the problem?

Worse than that, they have also lost 20,000 cows. Present on computers, but nowhere to be found in real life, a BBC report states that the persons in charge are completely baffled by this problem. Well at least we know what happens to our cows: they die of neglect.

Over 200 head of cattle died in the Taourgha Project this year in between a change of management phase, according to television reports.

To be fair to the British, they’re seriously thinking of changing the government. In Third World countries, people aren’t so cruel. Give the poor guys another chance, we say. We still believe in that age old slogan of one for all and all for one.

Economic progress and free markets have forever been touted as signs and signals that the First World is truly a democratic dream that the Third World is unable to conceive. But the present global financial nightmare that has left many Americans homeless and/or bankrupt is also a by-product of the Bush freedom-loving-era.

Allowing giant banks and giant companies to accept ‘bail-outs’ in hundreds, I mean “hundreds”, of billions of dollars without any legal repercussions or punishment, and without allowing citizens to seek legal redress, sounds, not just like the Third World to me, but worse.

Where else is thievery and crime rewarded by governments? Everywhere in the world it now seems. We shouldn’t feel too bad about ourselves, being Third World citizens. We have plenty of company.

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MIRZA AZIZ TURNS DOWN WB’S PLEA TO CUT FARM SUBSIDY – The farmers will not be able to use adequate inputs like fertiliser if the agricultural subsidy is withdrawn (Bangladesh)

Posted by Gilmour Poincaree on November 16, 2008

Sunday November 16 2008 11:34:06 AM BDT

Finance and planning adviser Mirza Azizul Islam has turned down a donor agency suggestion to cut Newly appointed Advisor for Ministry of Finance, Planning, Commerce and Posts and Telecommunications Dr. A B Mirza Azizul Islam was born in Sujanagar, Pabna on 23 February 1941. He studied BA (Hons.) and MA in Economics from Dhaka University. He studied M A in Development Economics at Williams College, Masachusetts, USA in 1975. He also obtained Ph.D in Economics from Boston University, USAagricultural subsidy saying “it would be risky in the prevailing global situation”.( The Financial Express)

“I am afraid that’s not a feasible option unless we have the land reforms done,” he said at a launching session of the two-day South Asia regional conference on managing food price inflation in a city hotel Saturday.

“The farmers will not be able to use adequate inputs like fertiliser if the agricultural subsidy is withdrawn. It will bring down the production. The country’s food security will be affected,” Dr. Aziz said in response to a suggestion made by World Bank (WB) in the conference.

WB South Asia Regional Director Sadiq Ahmed said a country like Bangladesh should address food security concerns by focusing on farm productivity rather than through subsidised inputs.

“The saved subsidy could be redirected to areas that support farm productivity including spending on rural infrastructure, farm technology, research and extension,” Mr. Ahmed said.

The World Bank and local research firm Power and Participation Research Centre (PPRC) jointly organised the conference.

Economists, policymakers, bureaucrats, agriculture experts, and political leaders from six South-Asian THE MEANING OF SUBSIDIES IN THE DEVELOPED COUNTRIEScountries, and representatives from donor agencies spoke at the function, with economist Professor Wahiduddin Mahmud in the chair.

Mirza Aziz said: “We can think on the issue of diverting subsidy fund to develop the rural infrastructure. But it could be a long-term programme. At this moment, we can not take the risk of withdrawing subsidy from agriculture.”

About the food inflation, the finance adviser said: “Agricultural credit growth during the last financial year has lifted the retention capacity of the farmers. It has been affecting the domestic food price despite bumper boro production.”

He, however, said the government will encourage the growth of the agricultural credit in future days.

The adviser said food stock in the country is satisfactory as it now stood at over 1.4 million tonnes compared to 0.4 million tonnes that this government inherited.

Senior economists Prof. Mahmud said: “Adequate food stock does not mean that the price will come down in the market. I think the prices of rice and wheat will not decline to the level that prevailed a AUSTRALIA AND THE EUROPEAN SUBSIDIESyear ago.”

“In the open market economy there are some complexities. Prices of food grain are not down despite adequate supply.”

“The market price depends on the purchase price of stock by the businessmen. I think the businessmen stock-piled at high prices. For this reason, the food price in local market is still high,” he said.

Prof Mahmud suggested raising the employment opportunities and wages of poor people for establishing balance between food inflation and entitlement to foods.

“Apart from food inflation, another risk of global recession has emerged recently. So, the government will have to take prudent steps for future food security,” he said.

Former education minister Osman Farruk said: “The donors always press the government to withdraw agricultural subsidy. But it is an effective measure to improve the productivity of foodgrain and income SUBSIDIES IN THE DEVELOPED COUNTRIES - GETTING PAID FOR NOT DOING ANYTHINGtransfer to the rural poor farmers.”

Former Agriculture Minister MK Anwar said: “If we want to keep the farmers in the field, we need to ensure agriculture as a profitable venture.”

Awami League leader Abdur Razzak laid emphasis on adequate supply of agricultural inputs to the farmers in time and at reasonable prices.

The Financial Express

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Posted in AGRICULTURE, BANGLADESH, ECONOMIC CONJUNCTURE, ECONOMY, EUROPE, FARMING SUBSIDIES, INTERNATIONAL, THE FLOW OF INVESTMENTS, USA, WORLD BANK, WORLD TRADE ORGANIZATION | Leave a Comment »

SARKOZY SAYS U.S. MISSILE SHIELD WON’T HELP SECURITY

Posted by Gilmour Poincaree on November 14, 2008

Published: November 14, 2008

The Associated Press

U.S. President George W. Bush, left, gestures during a joint news conference with French President Nicolas Sarkozy at Elysee Palace on Saturday, June 14, 2008Nicolas Sarkozy at Elysee Palace on Saturday, June 14, 2008

NICE, France: France’s U.S.-friendly president sent a clear message Friday to the next American administration: Plans for a U.S. missile shield in Eastern Europe are misguided, and won’t make the continent a safer place.

Nicolas Sarkozy also warned Russian President Dmitry Medvedev against upping tensions by deploying missiles on the borders of the European Union in response to the U.S. planned missile defense system.

Sarkozy’s comments, at a summit with Medvedev, were the strongest to date by an American ally against the missile-defense plans — and undercut the rationale behind U.S. President George W. Bush’s European security strategy.

The plans for using sites in Poland and the Czech Republic have infuriated Russia despite the Bush administration’s insistence that they are aimed at protecting Europe from Iran.

“Deployment of a missile defense system would bring nothing to security … it would complicate things, and would make them move backward,” Sarkozy said at a news conference with Medvedev. Medvedev smiled and pointed his finger at Sarkozy in approval.

The remarks came at the end of a week in which the United States and Russia rejected each other’s proposed solutions to the standoff over the missile plans, making it increasingly likely that it will not be resolved before U.S. President-elect Barack Obama takes office.

Obama has not been explicit about his intentions on European missile defense, saying it would be prudent to “explore the possibility” but expressing some skepticism about the technical capability of U.S. missile defenses.

Moscow sees the defense plans as a Cold War-style project that could eliminate Russia’s nuclear deterrent or spy on its military installations. Much of Western Europe is nervous about the idea of such major defensive weaponry stationed around the continent.

But Poland and the Czech Republic, where bad memories of Soviet domination run deep, hope Obama follows through on the plans.

Czech Deputy Prime Minister and Minister for European Affairs Alexandr Vondra said in a statement he “was surprised” about Sarkozy’s remarks, made at an EU-Russia summit.

“France never consulted with us such a standpoint,” he said. “As far as I know a stance on the missile defense was not part of the French presidency mandate for the EU-Russia summit.” France currently holds the rotating EU presidency.

Sarkozy said he was worried about Russia’s threat to deploy short-range Iskander missiles near Poland in response to the U.S. move.

“We could continue between Europe and Russia to threaten each other with shields, with missiles, with navies,” he said. “It would do Russia no good, Georgia no good and Europe no good.”

Sarkozy said he would discuss the missile issue with NATO counterparts at a summit early next year and proposed a pan-European security conference after that, to include Russia. Medvedev welcomed the idea.

Sarkozy has generally been hawkish on Iran and allied himself more closely with Bush than his predecessor Jacques Chirac. But Sarkozy is also clearly looking ahead to his relations with Bush’s successor.

Medvedev stuck to Russia’s stance. He suggested that the Russian threat to install missiles in the Baltic Sea region of Kaliningrad — announced just hours after Obama’s election — was “a response to the behavior of certain European states that agreed to deploy new (missile defenses) on their own territories without consulting anyone.”

Friday’s summit made a key step toward rapprochement between Russia and the European Union: The EU announced the resumption of partnership talks with Russia that had been put on hold because of the war in Georgia.

Critics, including the United States and Georgian governments and human rights groups, say it is too soon to forgive Russia, in effect, when Russian troops remain implanted and unchecked in the two breakaway Georgian provinces at the core of the war.

Sarkozy, temporarily in charge of the 27-nation EU, insisted that the resumption wasn’t “a sign of weakness.”

He and Medvedev remained divided, though, over the continuing presence of Russian troops.

The European Union is Russia’s No. 1 customer and No. 1 investor, and heavily dependent on Russian energy. With the world financial crisis shaking markets in Europe and beyond, officials of the 27-nation EU say reaching out to Moscow is crucial to ensuring stability and to keeping Russia from shutting off its economy to outsiders.

Medvedev pointed on Friday to the lucrative trade between the EU and Russia, worth hundreds of billions of euros annually.

“We should think of this when we make decisions on all cooperation,” he said.

The EU-Russia talks, launched in 2007, aim for an agreement that would increase economic integration, tighten relations on justice and security and boost cooperation in education and science. U.S. diplomats warned European officials that the resumed talks could undermine Western attempts to rein in the Kremlin’s aggressive foreign policy.

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EU UNVEILS PLAN TO WEAKEN RUSSIAN GRIP ON GAS SUPPLY – Southern corridor pipeline would bypass Gazprom – Strategy is part of £1.5tn energy security package

Posted by Gilmour Poincaree on November 14, 2008

Friday November 14 2008

by Ian Traynor in Brussels – The Guardian – guardian.co.uk

Europe yesterday stepped up attempts to reduce its exposure to potential Russian blackmail over energy supplies, unveiling an ambitious strategy aimed at weakening Russian giant Gazprom’s domination of Europe’s gas imports.

On the eve of the Russia-EU summit today in France, the energy package released by the European commission highlighted Europe’s dependence on Russian exports and sought to devise strategies to wean Europe off the addiction.

Of six energy projects pinpointed for development, commission officials said the two “absolute” priorities were to connect the three post-Soviet Baltic states of Lithuania, Latvia, and Estonia to European power grids and to forge ahead with the so-called “southern gas corridor”, which is supposed to transport gas from the Caspian basin to Europe while, for political reasons, bypassing the world’s two biggest gas producers, Russia and Iran. Both projects are aimed at loosening Russia’s grip.

By next year Brussels also aims to have set up a consortium of European companies to buy gas from the Caspian basin, to be shipped to Europe in a new pipeline from Azerbaijan, via Turkey and the Balkans, to Austria from 2013. Gazprom currently controls all the pipelines sending gas to Europe from the east.

“The EU wants different sources of supply,” said José Manuel Barroso, the commission president, who will negotiate on energy today with the Russian president, Dmitry Medvedev, at a summit in the south of France. “We must not sleepwalk into Europe’s energy dependence crisis.”

The Baltic states are isolated from the rest of the EU in their energy supplies and dependent on Russia, while another five EU countries in central Europe and Ireland also get all their gas from Russia. Germany is the EU’s biggest Gazprom client.

Europe currently gets 42% of its gas, a third of its oil and a quarter of its hard coal from Russia. The commission estimates that by 2030 Europe will be importing 84% of its gas needs, up from 61% at present.

In a direct reference to the perceived threat from Russia, a commission document warned: “Recent events in Georgia have shown that this is a critical time for energy security.”

The immediate focus on Russia was contained in a more grandiose long-term package calling for the integration of European power grids and energy markets; the incorporation of North Sea wind farms and Mediterranean solar energy hubs in a nascent European “supergrid”; the development of vast pan-European infrastructure projects; and an energy efficiency revolution. The entire scheme- aimed at making Europe’s energy consumption “secure, sustainable, and competitive” – would cost almost €2 trillion (£1.5tn) by 2030 and is also factored into the campaign on global warming, ostensibly making Europe the world leader in the low-carbon economy contest.

The commission proposals said current contingency planning on gas supplies “might not provide an effective and timely response in crisis situations” and called for common policy-making among the 27 member states to define “an effective EU emergency plan”, to cope with possible disruptions of supplies.

The EU has been struggling for two years to come up with coherent policies towards Russia, particularly on energy, while Russia and Gazprom have strengthened their grip by creating facts on the ground and cutting deals with individual countries.

Relations between Moscow and the west, already poor, plumbed new depths in August when Russia invaded Georgia. Despite the tensions, EU governments decided on Monday to resume negotiations with Moscow that were called off in protest at the Caucasus conflict. Britain performed a volte-face, going from being a fierce critic of Moscow to supporting the resumption of talks on a strategic pact between Russia and Europe.

“The British signalled well in advance that they were giving up [opposition to the negotiations],” said a senior European minister.

The dependence on Russian energy played a crucial role, he added. With gas prices currently low, Gazprom has in recent weeks been offering long-term supply contracts to individual EU countries such as Germany and the Netherlands, sowing divisions within the EU. The east European and British critics of Russia abandoned their opposition in the hope that a concerted policy would strengthen the EU in its dealings with Moscow.

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CITIGROUP TO LAY OFF 10,000 WORKERS WORLDWIDE

Posted by Gilmour Poincaree on November 14, 2008

Friday, 14 November 2008

The international banking company Citigroup is reportedly planning to shed up to 10,000 jobs as part of CITIGROUPa cost-cutting plan.

Reports in the US say the firm plans to lay off staff in its investment bank and across other divisions around the world.

Citigroup employs around 2,000 people in Ireland, where it set up an office 43 years ago.

It is unclear if the jobs announcement will have any effect on the Irish operation.

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RUSSIAN ENVOY CRITICIZES NATO REFUSAL TO LET HIM ADDRESS SESSION

Posted by Gilmour Poincaree on November 14, 2008

13:38 – 14/11/2008

by Ria Novosti

BRUSSELS, November 14 (RIA Novosti) – Russia’s envoy to NATO has criticized the alliance for refusing Russian envoy Dmitry Rogozinhim the right to address the NATO parliamentary session starting on Friday in Spain, while allowing the Georgian leader to give a speech.

NATO’s 54th Parliamentary Assembly session in Valencia runs from November 14 to 18. Georgian President Mikheil Saakashvili, who has been actively seeking membership in the Western military alliance, is expected to focus on criticism of Russia’s role in the August conflict over South Ossetia.

“Parliamentarians should be free to choose their information sources on the conflict. Instead of hearing alternative information, they will be listening to the twittering of Saakashvili,” Russian envoy Dmitry Rogozin told RIA Novosti.

He said he had intended to give Russia’s account of Georgia’s August 8 attack on breakaway South Ossetia and the ensuing five-day war between Russia and Georgia, but that the NATO Parliamentary Assembly’s president, Jose Lello, had refused, saying there was not sufficient time to fit him into the session schedule.

Saakashvili will give his speech on November 18. Rogozin said he has refused NATO’s invitation to attend the session.

During the August conflict, most Western powers sided with Georgia, accepting Saakashvili’s claim that Georgia reacted to military aggression from Russia.

However, Saakashvili’s version of events has come under scrutiny since the conflict, and Western rights groups have criticized Georgia’s attacks on South Ossetian civilians.

A report released on November 4 by the U.S.-based Human Rights Watch said the Georgian military used cluster munitions in civilian areas of South Ossetia.

Independent observers from the Organization for Security and Cooperation in Europe have said they are unable to verify Georgia’s claim that Russia bombarded Georgian villages in the run-up to the conflict. Georgia had based its justification for its attack on South Ossetia on the alleged Russian bombardment.

Saakashvili has also come under pressure in his own country. Around 10,000 protesters gathered on the streets of Tbilisi last Friday, rallying against the president for dragging the country into a costly war that it had little chance of winning.

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Posted in COMMONWEALTH OF INDEPENDENT STATES, EUROPE, HUMAN RIGHTS, INTERNATIONAL, INTERNATIONAL RELATIONS, NATO, RUSSIA | Leave a Comment »