China central bank mobbed for free loans
About 1 000 hopeful borrowers overran a branch of China's central bank as a rumour spread that it was handing out zero-interest loans, media said on Thursday, illustrating how Chinese financial know-how badly lags growth in banking products.
Police were called in on Tuesday to disperse the crowd, which had gathered for days outside the central bank in Beihai in the southern province of Guangxi, the Global Times said.
The rumour had spread that the People's Bank of China was distributing interest-free loans of between 50 000 yuan ($8 200) and 500 000 yuan.
"The People's Bank of China is a national financial regulator and does not extend deposit or lending services to individuals," Luo Daofang, the deputy head of the Beihai office, was quoted by Beihai television as saying.
The Beihai city government was not available for comment, and the central bank declined to comment when contacted.
As China frees up its financial markets, authorities must step up education of financial products, said Zhang Zhiwei, an economist at Nomura in Hong Kong.
"I worry more about investors buying wealth management products, thinking that these are risk-free, and finding out later down the road that they are not," Zhang said.
Growth in China's wealth management industry has exploded in the last three years as savers search for alternatives outside low-yielding bank deposits. Sales rose by 12.1trn yuan in the first six months of 2012.
China exports dip in June
China's exports fell 3.1% year-on-year (y/y) in June with imports also declining, the government said on Wednesday, in the latest signs of slowing growth in the world's second-largest economy.
The government recorded exports valued at $174.32bn in June and imports worth $147.19bn, down 0.7% y/y, the General Administration of Customs said.
The fall in monthly exports was the first negative figure since January 2012.
China's total foreign trade grew to almost $2trn in the first six months of this year, up 8.6% y/y, the administration said.
China's annual economic growth slipped from 9.3% in 2011 to 7.8% last year, the slowest expansion since 1999.
The government set targets of 8% for trade growth and 7.5% for growth in gross domestic product this year as it aims to rebalance the world's second-largest economy away from its long reliance on exports and investment in infrastructure.
Retailers unveil Bangladesh safety plan
The announcement in Washington by the Alliance for Bangladesh Worker Safety on Wednesday comes after 1 129 workers were killed in the collapse of a Bangladesh garment plant in April and another 112 people perished in November fire at a Bangladesh factory.
A separate safety plan including coordinated inspections was announced by a group of mainly European brands on Monday.
A few student protesters were outside the building in Washington, where the plan was announced. The group United Students Against Sweatshops handed out fliers, saying "Gap and Walmart: Bangladeshi Workers Reject Your Fake Safety Plan".
Funding for the North American plan is based on how much production each retailer has in Bangladesh; those at higher levels will pay $1m a year for five years.
So far, $42m has been raised for the project. Ten percent of the funds will be set aside to assist workers temporarily displaced by factory improvements or if a factory closes for safety reasons.
The money will also support a non-governmental organisation chosen to implement it. A decision on the NGO should come within 30 days.
The 17 current members of the alliance include: Canadian Tire Corp; Carter's; The Children's Place Retail Stores; Gap; Hudson's Bay Co; IFG; J C Penney Co; Jones Group; Kohl's; L L Bean; Macy's; Nordstrom; Public Clothing Co; Sears Holdings; Target; VF; and Walmart.
Hong Kong sourcing company Li & Fung, which does business with many of the companies involved, is serving as an adviser. Additional members are expected to join in the future.
"The safety record of Bangladeshi factories is unacceptable and requires our collective effort," member chief executives said in a joint statement.
"We can prevent future tragedies by consolidating and amplifying our individual efforts to bring about real and sustained progress."
Goals include developing common safety standards within three months, sharing inspection results, and getting factories to support the democratic election and operation of worker participation committees.
An independent board chairperson, set to be named in the next few weeks, will oversee the plan. Four retailers and four others will also be on the board.
The plan, Bangladesh Worker Safety Initiative, was developed with assistance from former U S senators George Mitchell and Olympia Snowe, who acted as independent facilitators at the Bipartisan Policy Center.
The group has asked Mitchell and Snowe to verify the effectiveness of the programme over at least the first two years.
Some companies are also set to offer a combined total of over $100m in loans and access to capital to help factory owners improve safety.
The North American group's plan is being backed by the American Apparel & Footwear Association, Canadian Apparel Federation, National Retail Federation, Retail Council of Canada, Retail Industry Leaders Association, and the United States Association of Importers of Textiles & Apparel.
A larger number of mostly European retailers and brands backed a safety accord put together with the help of labour unions.
The group behind that plan includes the world's two biggest fashion retailers, Inditex SA, owner of the Zara chain, and H&M. A small number of North American companies such as PVH signed onto that accord.
UK MP's pay rise angers public
Britain's members of parliament will get a 9 percent pay rise under a proposal announced on Thursday that outraged a public struggling with wage freezes, high living costs and a government austerity drive.
The proposal which, ironically, was made by a panel created to mend parliament's image after an expenses scandal is uncomfortable for David Cameron, a prime minister seen by many as part of an out-of-touch elite, adrift from the worries of most voters.
Tabled by the Independent Parliamentary Standards Authority (IPSA), created to distance lawmakers from the pay and expenses system, the proposal cannot be blocked by members of parliament (MPs), even if they were to oppose it.
Cameron's spokesperson said the prime minister "doesn't think MPs' pay should be going up when public sector pay is being rightly constrained".
Deputy Prime Minister Nick Clegg said the plan, to increase MPs' annual pay to £74 000 from £66 396, was "incomprehensible".
The proposal is way above the 2.7% inflation rate and comes at a time of job losses, public sector cuts and low wage growth following a deep recession.
"Everyone has to be treated as fairly and equally as possible in the public sector," Clegg told LBC radio.
Public support for parliament was dented by the 2009 scandal when politicians were exposed boosting their income by claiming expenses for everything from pornographic films and dog food to tennis court repairs.
The public has until 20 October to respond to the proposal before the IPSA makes a final decision on what it said it was a package to end years of "fixes, fudges and failures" over MPs' pay.
Appalled
If no changes are made to the plan, MPs' pay will rise in 2015, the year of the next election. They will lose some perks, including money for evening meals and late night taxis home.
Public workers, unions and campaigners were appalled.
"The idea of hiking MPs' pay when everyone else has been suffering such a squeeze on their earnings is totally unpalatable," said Matthew Sinclair, of the TaxPayers' Alliance, which campaigns for lower taxes.
Unions said pay freezes or rises capped at 1% were widespread since the coalition government came to power in 2010.
"The very idea that MPs should enjoy an exemption and take a 9% increase will rightly cause outrage amongst workers up and down the country," said Dave Prentis, head of Unison, Britain's biggest trade union.
Debate over how much MPs should be paid has raged since they first received an annual salary, of £400, in 1911. That was meant to open politics to people without independent wealth.
Iran building new nuclear site - claim
An exiled opposition group said on Thursday it
had obtained information about a secret underground nuclear site under
construction in Iran, without specifying what kind of atomic activity it believed would be
carried out there.
The dissident National Council of Resistance of Iran (NCRI) exposed Iran's uranium enrichment facility at Natanz and a heavy water facility at Arak in 2002. But analysts say it has a mixed track record and a clear political agenda.
In 2010, when the group said it had evidence of another new nuclear facility, west of the capital Tehran, US officials said they had known about the site for years and had no reason to believe it was nuclear.
The latest allegation comes less than a month after the election of a relative moderate, Hassan Rouhani, as Iran's new president raised hopes for a resolution of the nuclear dispute with the West, and might be timed to discredit such optimism.
The Islamic Republic says its nuclear energy programme is entirely peaceful and rejects US and Israeli accusations that it is really seeking the capability to make nuclear weapons.
But its refusal to curb sensitive nuclear activity, and its lack of full openness with the UN nuclear watchdog agency, have drawn tough Western sanctions and a threat of pre-emptive military strikes by Israel.
Satellite images
The NCRI said members of its affiliated People's Mujahideen Organisation of Iran (PMOI) inside the country had "obtained reliable information on a new and completely secret site designated for [Iran's] nuclear project".
The NCRI, which seeks an end to Islamist theocratic rule in Iran, is the political wing of the PMOI, which fought alongside Saddam Hussein's forces in the Iran-Iraq war in the 1980s.
The NCRI said the site was inside a complex of tunnels beneath mountains 10km east of the town of Damavand, itself about 50km northeast of Tehran. Construction of the first phase began in 2006 and was recently completed, it said.
The group released satellite photographs of what it said was the site. But the images did not appear to constitute hard evidence to support the assertion that it was a planned nuclear facility.
A spokesperson for the dissidents said he could not say what sort of nuclear work would be conducted there, but that the companies and people involved showed it was a nuclear site. The group named officials it said were in charge of the project.
"The site consists of four tunnels and has been constructed by a group of engineering and construction companies associated with the engineering arms of the Ministry of Defence and the IRGC Iran's elite Revolutionary Guards force," the NCRI said.
'No link to nuclear programme'
"Two of the tunnels are about 550m in length, and they have a total of six giant halls."
Asked about the report, International Atomic Energy Agency spokesperson Gill Tudor said in Vienna: "The agency will assess the information that has been provided, as we do with any new information we receive."
A Western diplomat accredited to the IAEA told : "I have heard nothing. My first suspicion is that it is like the 2010 revelation a tunnel facility the Iranians are keeping quiet, but no known link to the nuclear programme."
Iran said in late 2009 that it planned to build 10 more uranium enrichment sites on top of its underground Natanz and Fordow plants, but has provided little additional information.
Refined uranium can provide fuel for nuclear power plants, which is Iran's stated aim, but can also be used to make atomic bombs, which the West fears may be Tehran's ultimate goal.
The dissident National Council of Resistance of Iran (NCRI) exposed Iran's uranium enrichment facility at Natanz and a heavy water facility at Arak in 2002. But analysts say it has a mixed track record and a clear political agenda.
In 2010, when the group said it had evidence of another new nuclear facility, west of the capital Tehran, US officials said they had known about the site for years and had no reason to believe it was nuclear.
The latest allegation comes less than a month after the election of a relative moderate, Hassan Rouhani, as Iran's new president raised hopes for a resolution of the nuclear dispute with the West, and might be timed to discredit such optimism.
The Islamic Republic says its nuclear energy programme is entirely peaceful and rejects US and Israeli accusations that it is really seeking the capability to make nuclear weapons.
But its refusal to curb sensitive nuclear activity, and its lack of full openness with the UN nuclear watchdog agency, have drawn tough Western sanctions and a threat of pre-emptive military strikes by Israel.
Satellite images
The NCRI said members of its affiliated People's Mujahideen Organisation of Iran (PMOI) inside the country had "obtained reliable information on a new and completely secret site designated for [Iran's] nuclear project".
The NCRI, which seeks an end to Islamist theocratic rule in Iran, is the political wing of the PMOI, which fought alongside Saddam Hussein's forces in the Iran-Iraq war in the 1980s.
The NCRI said the site was inside a complex of tunnels beneath mountains 10km east of the town of Damavand, itself about 50km northeast of Tehran. Construction of the first phase began in 2006 and was recently completed, it said.
The group released satellite photographs of what it said was the site. But the images did not appear to constitute hard evidence to support the assertion that it was a planned nuclear facility.
A spokesperson for the dissidents said he could not say what sort of nuclear work would be conducted there, but that the companies and people involved showed it was a nuclear site. The group named officials it said were in charge of the project.
"The site consists of four tunnels and has been constructed by a group of engineering and construction companies associated with the engineering arms of the Ministry of Defence and the IRGC Iran's elite Revolutionary Guards force," the NCRI said.
'No link to nuclear programme'
"Two of the tunnels are about 550m in length, and they have a total of six giant halls."
Asked about the report, International Atomic Energy Agency spokesperson Gill Tudor said in Vienna: "The agency will assess the information that has been provided, as we do with any new information we receive."
A Western diplomat accredited to the IAEA told : "I have heard nothing. My first suspicion is that it is like the 2010 revelation a tunnel facility the Iranians are keeping quiet, but no known link to the nuclear programme."
Iran said in late 2009 that it planned to build 10 more uranium enrichment sites on top of its underground Natanz and Fordow plants, but has provided little additional information.
Refined uranium can provide fuel for nuclear power plants, which is Iran's stated aim, but can also be used to make atomic bombs, which the West fears may be Tehran's ultimate goal.
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