NEWS,10.01.2013

Greek unemployment rate tripples

Greece's unemployment rate climbed to a record 26.8% in October as the debt-laden country remained sunk in recession, data showed on Thursday.Greece's jobless rate has almost tripled since it started rising in September 2009 as the country's debt crisis became apparent, and is more than double the average rate in the 17-nation eurozone, which stood at 11.8% in November.Unemployment among youth aged 15-24 also touched a new record of 56.6% in October, compared with 22.1 percent in the same month four years ago, statistics service ELSTAT said.A record 1.34 million Greeks were without work in October, up 38% from the same month in 2011, it said.After months of uncertainty over its future in the eurozone, Greece has managed to avoid bankruptcy but its economy is still sinking under austerity policies imposed by foreign lenders as the price for continued aid. The influential IOBE think tank on Thursday projected the economy would shrink 4.6% this year, taking a slightly more pessimistic view than the government, which expects the contraction at 4.5%, and the country's foreign lenders, who see it at 4.2%.IOBE also predicted unemployment would rise further to 27.3% this year, which is set to be the sixth consecutive year of recession.However, spending cuts helped narrow the country's central government budget gap by 30% in 2012 to €15.91bn ($20.75 billion), the finance ministry said. The central government budget figure excludes key elements of the general government budget, which is the figure used by the European Union to assess Greece's fiscal performance under its latest EU/IMF bailout programme.

Up to half of world's food wasted

Up to half of all the food produced worldwide ends up going to waste due to poor harvesting, storage and transport methods as well as irresponsible retailer and consumer behaviour, a report said on Thursday.The world produces about four billion metric tonnes of food a year but 1.2 to 2 billion tonnes is not eaten, the study by the London-based Institution of Mechanical Engineers said."This level of wastage is a tragedy that cannot continue if we are to succeed in the challenge of sustainably meeting our future food demands," said.In developed countries, like Britain, efficient farming methods, transport and storage mean that most of the wastage occurs through retail and customer behaviour.Retailers produce 1.6 million tonnes of food waste a year because they reject crops of edible fruit and vegetables because they do not meet exacting size and appearance criteria, the report by the engineering society said."Thirty percent of what is harvested from the field never actually reaches the marketplace (primarily the supermarket) due to trimming, quality selection and failure to conform to purely cosmetic criteria," it said.Of the food which does reach supermarket shelves, 30-50% of what is bought in developed countries is thrown away by customers, often due to poor understanding of "best before" and "use by" dates.A "use by" date is when there is a health risk associated with using food after that date. A "best before" date is more about quality - when it expires it does not necessarily mean food is harmful but it may lose some flavour and texture.However, many consumers do not know the difference between the labels and bin food after "best before" dates.Promotional offers and bulk discounts also encourage shoppers to buy large quantities in excess of their needs.In Britain, about £10.2bn ($16.3bn) worth of food is thrown away from homes every year, with £1bn worth being perfectly edible, the report found.By contrast, in less developed countries, such as in sub-Saharan Africa or South East Asia, wastage mostly happens due to inefficient harvesting and poor handling and storage.In South-East Asian countries, for example, losses of rice range from 37-80% of their entire production, totalling about 180 million tonnes per year, the report said.The United Nations predicts global population will peak at around 9.5 billion people by 2075, meaning there will be an additional 2.5 billion people to feed.The rising population, together with improved nutrition and shifting diets will put pressure for increases in global food supply over the coming decades.Rising food and commodity prices will drive the need to reduce waste, making the practice of discarding edible fruit and vegetables on cosmetic grounds less economically viable.However, governments should not wait for food pricing to trigger action on this wasteful practice, but produce policies that change consumer behaviour and dissuade retailers from operating in this way, the study said.Rapidly developing countries like China and Brazil have developed infrastructure to transport crops, gain access to export markets and improve storage facilities but they need to avoid the mistakes made by developed nations and make sure they are efficient and well-maintained.Poorer countries require significant investment to improve their infrastructure, the report said. For example, Ethiopia is considering developing a national network of grain storage facilities which is expected to cost at least $1bn."This scale of investment will be required for multiple commodities and in numerous countries, and co-ordinated efforts are going to be essential," the report said.

US pumps record high into govt coffers

The Federal Reserve pumped a record $88.9bn into the US Treasury last year, the spoils of big profits made on its vast holdings of securities, the US central bank said on Thursday.The Fed said the money was earned primarily from interest payments on the securities in its multi-trillion dollar portfolio of US government debt and bonds related to the housing industry.Each year, the central bank sends its earnings, minus operating costs and other expenses, to the Treasury.The 2012 figure eclipsed the prior record of $79.3bn deposited into government coffers in 2010.The Fed estimated its net income for last year at $91 billion.

US jobless claims rise

The number of Americans filing new claims for unemployment benefits rose last week, but seasonal volatility makes it difficult to get a clear picture of the labour market's health.Initial claims for state unemployment benefits increased 4 000 to a seasonally adjusted 371 000, the Labor Department said on Thursday. The prior week's figure was revised to show 5 000 fewer applications than previously reported. Claims tend to be very volatile around this time of the year because of the holidays and seasonal layoffs. While they increased last week, there was nothing in the data to suggest a deterioration in labor market conditions. The four-week moving average for new claims, a better measure of labor market trends, increased 6 750 to 365 750, still at a level consistent with steady job gains.A Labour Department official said there was nothing unusual in state level data and that no states had been estimated. He noted, however, that jobless claims on an unadjusted basis tend to peak in the second week of January and the rise in the week ended Jan. 5 was a build-up to that.The labor market has been gradually improving, with job gains last year averaging 153 000 per month, little changed from 2011. That has not been enough to significantly cut the unemployment rate which ended the year at 7.8%.The claims report showed the number of people still receiving benefits under regular state programs after an initial week of aid tumbled 127 000 to 3.11m in the week ended Dec 29, the lowest level since July 2008.The weekly decline was the largest since January 2011.The insured unemployment rate fell to 2.4%, its lowest since July 2008.

Gold worsens global health

High gold prices are driving up the use of toxic mercury in small-scale mining in developing nations, spreading a poison that can cause brain damage in children thousands of miles away, a UN study showed on Thursday. Negotiators from 120 nations will meet in Geneva next week for a final round of talks meant to agree a treaty to reduce the use of mercury. It is mainly emitted by gold mining, where it helps separate gold from ore, and by coal-fired power plants. A leap in gold prices to almost $1 700 an ounce from $400 less than a decade ago has spurred a surge in small-scale gold mining in South America, Africa and Asia which employs up to 15 million people, the UN Environment Programme (UNEP) said. Workers risk acute poisoning and, released to the air or washed into rivers and the oceans, mercury emissions spread worldwide. Mercury, a liquid metal also known as quicksilver, can cause harm especially to the brains of foetuses and infants. "Exposing infants and mothers to mercury is a cruel and increasingly unnecessary risk," Achim Steiner, head of UNEP, told Reuters by telephone from Nairobi, adding that there were cleaner alternatives to mercury in mining. "A Chinese baby born today, just like an American or a Japanese or a Brazilian one, really shouldn't be condemned to have neurological damage as a result of mercury," Steiner said."The very high gold price has ... brought more people, especially at the poorest end of society, into the gold mining sector," Steiner said. UNEP said damage to health and the environment was increasing as a result. Emissions of mercury from artisanal and small-scale gold mines more than doubled to 727 tonnes in 2010 from 2005 levels and now made up 35% of the global total, UNEP said. Part of the surge reflected better data - some mines in operation for years had been unknown, such as in West Africa.Eating fish is the main way mercury builds up in humans. It enters rivers and the oceans and accumulates as methylmercury in the bodies of fish, especially big predators such as swordfish, shark, king mackerel, tuna and sea bass.The report estimated that human emissions of mercury totalled almost 2 000 tonnes in 2010, mostly from Asian nations led by China. It said that level had been roughly stable for the past 20 years despite efforts for deeper cuts after a peak in the 1970s. Mercury also comes from natural sources such as volcanoes.The UN plan is to hold an international conference in late 2013 in Minamata, Japan, the site of one of the worst industrial releases in the 1950s, to approve a new convention to restrict mercury based on texts to be agreed in Geneva. Steiner expressed hopes that a UN convention would spur innovation by companies to cut mercury use. Technologies include filters for coal-fired power plants or substitutes in products such as thermometers, light bulbs and dental fillings. Many nations have tightened laws - the United States barred exports of mercury from January 1, 2013. The European Union, until 2008 the main global exporter, barred exports in 2011.UNEP's study did not provide an estimate for the overall health and environmental damage caused by mercury. UNEP spokesperson Nick Nuttall said that limiting dangerous metals such as mercury could have huge benefits. He noted that one study in 2011 put the benefits from phasing out another poison - lead in gasoline - at more than $2 trillion a year by reducing pollution linked to heart disease, diminished intelligence and even high crime rates.

ECB holds rates at record low of 0.75%

The European Central Bank held interest rates at a record low of 0.75% on Thursday, refraining from a cut following fledgling signs of life in the eurozone economy and with inflation still above target.The 17-country eurozone is in recession but recent data points to some stabilisation. Last month, ECB President Mario Draghi said there was "a wide discussion" on reducing rates - a comment that fed expectations a cut could soon follow. But hawkish remarks from a clutch of senior policymakers since have dampened that talk."This is not a surprise given some of the recent comments from the board, which did seem to play down the recent focus on interest rates," Nomura economist Nick Matthews said of Thursday's rate decision.The euro rose against the US dollar after the decision to $1.3115 from $1.3096 beforehand.New ECB Executive Board member Yves Mersch said last month he did not see the logic of a debate about the ECB cutting its main rate and Peter Praet said there was little room to cut.Stronger survey data appeared to have strengthened the resolve of those at the ECB against a rate cut, Matthews said.An improvement in eurozone business morale in December, when a survey also pointed to a slowing service sector contraction, suggests a modest turnaround in the bloc after a grim fourth quarter.Another cut of the refinancing rate would raise the question of whether the ECB would also lower its deposit rate - already at zero - by the same amount, which would push it into negative territory, essentially charging a fee for banks to park money with it, for the first time.Even though Draghi has said the bank was "operationally ready" for such a step, it has grown increasingly wary of the idea, a source with knowledge of the ECB's thinking said.Negative deposit rates could deal a hefty blow to money market funds, which have already seen cash outflows since the ECB cut the deposit rate to zero in July. The rate is a peg for short-dated money market rates and it is already almost impossible for funds to generate a return for their investors.Executive Board member Joerg Asmussen said last month he would be "very reluctant" about the ECB cutting the deposit rate any further. ECB staff projections published last month saw inflation at about 1.4% in 2014, which would usually justify another interest rate cut. The central bank also sees inflation falling below 2% this year with underlying price pressures remaining moderate.But inflation has eased more slowly than the ECB initially expected and as long as it misses the target - it has been above 2% for more than 2 years - a rate cut could be difficult to justify. In addition to gauging whether the ECB is entertaining another cut or not, Draghi will be pressed on other policy options, particularly to improve lacklustre bank lending. ECB data showed last week that bank lending to the private sector fell at an annual rate of 0.8% in November.At his December news conference, Draghi attributed the drop mainly to demand factors, but added that in a number of countries, credit supply is restricted.A move by global regulators to give banks more time and flexibility to build up cash reserves is expected to do little to support a recovery in Europe, where recession-hit firms and households have scant appetite for more debt. "One thing the ECB needs to engineer is recovery in lending," Rabobank economist Elwin de Groot said.A further question for Draghi will be how close he believes Ireland is to achieving the normalised market funding that would make it eligible for the ECB's new bond-buying programme."I would make the case but I'm not sure that the ECB would accept that case, but it's very close to it," John Corrigan, chief of Ireland's National Treasury Management Agency (NTMA) said on Wednesday.Meanwhile, the Bank of England also left its monetary policy settings unchanged on Thursday while it awaits clearer signals on the state of Britain's economy and more news on the progress of a key scheme to boost lending.After a two-day meeting, the BoE's nine-member Monetary Policy Committee (MPC) said its main interest rate would stay at a record-low 0.5% and it would not buy any government bonds on top of the £375bn purchased so far.

Global food prices drop 7% in 2012

Global food prices fell by 7% in 2012 from the level the previous year, the UN's Food and Agriculture Organisation said on Thursday, assuaging worries a few months ago that the world could be heading for a food crisis. The FAO added that prices had fallen in December for the third month in a row. The Rome-based FAO's Food Price Index averaged 212 points in 2012, a drop of 7% owing largely to falls in the prices of sugar, dairy products and oil.According to the FAO's index, a monthly measure of changes in a basket of food commodities, prices dropped in December by 1.1% to 209 points, down for the third month from the 263 points registered in August."The result marks a reversal from the situation last July, when sharply rising prices prompted fears of a new food crisis," said Jomo Sundaram from FAO's Economic and Social Development Department."But international coordination...as well as flagging demand in a stagnant international economy, helped ensure the price spike was short-lived and calmed markets so that 2012 prices ended up below the previous year’s levels," he said.The sharpest declines registered in 2012 were sugar (17.1%), dairy products (14.5%) and oils (10.7%), while price declines were much more modest for cereals (2.4%) and meat (1.1%).

French labour reform talks deadlock

French employers will consider some concessions in labour reform talks on Thursday but remain opposed to a key union demand to raise welfare charges on short-term contracts, their chief said as negotiations entered a final stretch.President Francois Hollande has called on business leaders and worker groups to strike a "historic deal" to overhaul France's labour market, helping firms to adjust their wage burden in a downturn and giving workers more job security.His Socialist government is pressing the parties to conclude a deal by January 15 as talks restart. A previous round broke up without an accord, with both sides accusing each other of making unacceptable demands.Hollande will introduce a draft law in the first quarter of 2013 regardless of whether a deal is struck. But without support from unions and employers, any law may face street protests and unions may push left-wing lawmakers to water it down."Tonight, we can reach a deal that puts France on par with the highest international standards in terms of flexi-security," Laurence Parisot, head of the Medef employers union, said on Europe 1 radio. "Anything less, there will be no deal."Flexi-security refers to a cooperative approach to labour relations widely used in northern Europe in which employees accept a degree of flexibility in working arrangements in return for employer commitments on job security.France wants to emulate that to address high unemployment and to eradicate the split in its jobs market between unflexible permanent contracts and short-term contracts increasingly used by employers but which offer workers little or no job security.Parisot said the Medef and its negotiating partner, the CGPME small- and medium-sized business group, would consider giving unions a voice and votes on company boards, and favoured making complementary health benefits automatic for workers.Unions say they could accept in-house deals allowing firms to temporarily cut work-hours during downturns, similar to arrangements in Germany. They may also accept the creation of new long-term job contracts with less iron-clad terms.However, union demands to impose higher welfare charges on short-term contracts remained a sticking point. Parisot said Medef was not prepared to extend talks beyond this week.Bernard Thibault, head of the hardline CGT union, said his group would not sign any deal in favour of de-regulation."What I can tell you is there is no way the CGT will approve the spirit of proposals from management's camp," he said.

Call for laws to protect domestic workers

Laws are "urgently" needed to give greater protection to domestic workers, the International Labour Organisation (ILO) said in its latest report on the state of domestic workers worldwide.In the report Domestic Workers Across the World, the ILO said the very nature of their work in private homes makes domestic workers less visible than other workers, and therefore more vulnerable to abusive practices.The report released on Wednesday showed significant growth in the sector in the 15 years from 1995 to 2010, with the number of people employed increasing by almost 20 million to 52.6 million.In 2010 domestic workers, 80% of whom are women, accounted for 1.7% of global employment.Despite this, many domestic workers are still not protected by laws that regulate working time, grant a minimum income or provide maternity protection, according to the report.It estimates that only about 10% of all domestic workers, about 5.3 million people, are covered by labour laws to the same degree as other workers.About 30% have no legal protection at all, the report said.The report however acknowledges that many countries in Africa, Latin America, the Caribbean and the industrialised world have already extended the same minimum protection which applies to workers generally to domestic workers. South Africa, for example, already regulates working times and respective hourly, weekly and monthly minimum wage rates, the report noted.The South African government last year announced a pay rise for all domestic workers with effect from December 1 2012. However, the SA Domestic Service and Allied Workers' Union accused the state of letting down domestic workers by not ratifying Convention 189 of the ILO. The convention advocates standardised working conditions, including minimum wages, rest hours, and leave for domestic workers. The report said the right to maternity protection is a key area of concern. “Women domestic workers are not entitled to maternity leave and associated maternity cash benefits. This poses a substantial obstacle for women domestic workers who wish to combine work with their own family responsibilities,” said the ILO.In addition to the lack of maternity benefits, the report highlights that there are no legal limits on weekly working hours for over half of the world's domestic workers, 45% are not guaranteed any weekly rest period and almost 50% have no minimum wage. South Africa, with more than 1.1 million domestic workers working for private households in 2010, is the biggest employer of domestic workers in southern Africa. The majority of workers are concentrated in Gauteng and KwaZulu-Natal, according to the report. The sector was also the third-largest employer for women in 2010, employing about 15.5% of all women workers.Employers from all races hire domestic workers. Although the government sets minimum wages and working hours, employers should also ensure they pay their workers a fair wage, said Dennis George, general secretary of the Federation of Unions of SA.George said employers should discuss realistic increases linked to the rising cost of living with their workers, as the minimum wage set by the government was only a guideline.Yendor Felgate, CEO of Emergence Growth Services, said the company's research into why so many employers fail to legalise their domestic service arrangements shows this is due to ignorance. “While most employers are keen to do the right thing, few are aware that that their two-day-a-week domestic worker qualifies as an employee," said Felgate.“Ultimately, it will be joint actions taken at the national level by governments, trade unions and employers that will bring decent work to the millions of domestic workers across the world,” said the ILO.