NEWS,23.09.2013

Obama unlikely to name new Fed head soon

President Barack Obama is unlikely to unveil his pick to succeed Ben Bernanke as chairperson of the Federal Reserve this week, and the current Fed No. 2, Janet Yellen, remains the leading contender, a source familiar with the process said on Monday.
Bernanke's second four-year term at the helm of the US central bank comes to a close in January, and speculation has swirled around Obama's plans for the replacement.
Former Treasury Secretary Lawrence Summers, considered the president's preference, withdrew his name from consideration a week ago, saying his confirmation would incite acrimony.
Besides Summers, Yellen and former vice chairperson Donald Kohn are among those Obama said he has been considering for the job. Yellen is still the top prospect, the source said.
The Senate needs to hold hearings and confirm the nominee, and with a compressed legislative schedule before the end of the year, time is growing tighter.
Lawmakers are currently preoccupied with measures to keep government funding going beyond Oct. 1 to keep the government from shutting down and to raise the nation's debt ceiling ahead of a mid-October date, or face the risk of default.
Yellen had been scheduled to speak to the Economic Club of New York on Oct. 1, but her speech has been postponed.

Lithuania urges push on EU farm reform

Lithuania, which currently holds the rotating EU presidency, on Monday urged a final push on a major reform of the bloc's generous farm subsidy programme that is held up in talks with European lawmakers.
A reform of EU farm subsidies agreed by member states in June after three months of marathon talks favours young farmers and smallholders over big business and has been called a "paradigm shift" for Europe.
"This is the challenge we must meet," said Lithuanian Agriculture Minister Vigilijus Juknawho as he met fellow European Union ministers in Brussels.
The ministers are locked in a row with European lawmakers, who want the reforms to go further.
If a compromise is not found before the end of the month, the European Commission could choose to suspend payments to farmers.
The main sticking point is how the reform affects large-scale farmers, with lawmakers pushing for more redistribution of farm aid to small holdings and ministers maintaining the reform has gone far enough.
EU ministers were to discuss the matter further Monday with another session of talks with the Commission and lawmakers set for the evening.
Irish Agriculture Minister Simon Coveney, who spearheaded the reform during the Irish EU presidency earlier this year, said there remained little room for more compromise from states.
But he said he was confident the Lithuanian presidency could find a deal in the coming weeks.
If approved, the CAP reform is due to be implemented starting in 2014.
Under the current rules, 80 percent of CAP payments go to the top 20 percent of intensive farm businesses since several countries still link the subsidies to production levels.
As the reform stands, member states would have to ensure that by 2019 each farmer receives at least 60 percent of the average national or regional subsidy per hectare. This would remove the advantage written into the current system for the more productive industrial farms.
The deal also states that 30 percent of EU members' farm payments will also be spent on "green" measures such as crop diversification.
The CAP accounts for about 38 percent of the EU's budget.

Spain heads for record tourism year

Sunseekers spurning unrest in Egypt and Turkey flocked to Spain in record numbers last month, setting the country up for its best-ever year for visitors and giving a boost to the ailing economy.
"It is very likely that 2013 will be the best year historically for tourism," Industry Minister Jose Manuel Soria told a news conference on Monday, adding that estimates for the fourth quarter were positive.
Tourism contributed over 5% of Spain's economy or GDP in 2012 and provided around 900 000 jobs, according to Euromonitor, in a country where one in four is out of work, meaning a boost to tourist figures should be good news as other sectors flag.
The number of international tourist arrivals in August rose to 8.3 million, figures from the tourism ministry showed, lifting the total for January through August by 4.5% on the year before to 42.3 million.
Those visitors spent a total of €40.4bn ($54.6bn), up 7% from 2012.
Political upheaval in other destinations has also benefited other Mediterranean countries, such as Greece.
But not everyone in Spain is celebrating the increase. Domestic travel fell by 6.9% between January and July, hitting destinations off the main tourist trail, so businesses and hotels reliant on city tourism suffered.
Two ends of the travel spectrum in particular are cashing in on the influx of international visitors - homeowners taking advantage of a growing preference for low-cost rents, and luxury stores whose clients are shielded from the worst of the economy's woes.
Many tourists have been choosing to rent private homes advertised on the Internet. And despite government efforts to tighten regulation around private renting, the trend is becoming more ingrained, with the number of rentals by tourists up 15% in August year-on-year to 1.3 million properties.
The unregulated rental industry has its risks since landlords and renters have little recourse if things go wrong, but it is worth it for homeowners who rent out year-round.
"What's happening ... because of the economic crisis is that people are preferring smaller airlines, smaller hotels and they are paying less," said Dimitrios Buhalis, a professor and director of the e-tourism lab at Bournemouth University.
Kept afloat
Spain's economy has been highly dependent on tourism since beach destinations took off in the 1960s. While Britain, France and Germany continue to send the most visitors, there has been a huge leap in the number of Russian visitors.
Some of the main beneficiaries are luxury retailers, as big spenders splash out at high-end accessory and jewellery stores. Department store El Corte Ingles for instance has offered a 10% discount to foreign shoppers since 2012 and has employed Chinese-speaking personal shoppers in a nod towards an important group of rich clients.
Value Retail, which has luxury outlets in Madrid and Barcelona, reported an increase in non-European visitors, especially Russian and Chinese, last year.
"Without a doubt, Spain's luxury sector is being kept afloat thanks to tourism," said Ana Franco, editor of Spanish luxury portal Deluxes.
Boosted by luxury, average spending by tourists rose by 2% in the first seven months of the year, from the same period of 2012, to 103 euros per day.
Regions attracting the most visitors are coastal Catalonia, the Balearic islands and southern Andalusia, home to the Costa del Sol. But Madrid saw a 22% fall in foreign visitors in August to 290 494, hit by a collapse in business travel and a decline in Italian and Latin American travelers.
There is little respite in sight for hotels operating in cities unless the domestic economy picks up, according to Ramon Estalella, secretary general of the Spanish Hotels Association (CEHAT).
NH Hoteles, which is focused mainly on city hotels, said in half-year results that Spain was its worst performing market. And Melia Hotels International reported a decline in prices and occupancy in Spanish cities in the first half, even though revenue from resort locations rose.
"There has been a strong fall in demand in Madrid because Iberia has cut flights and low-cost airlines have disappeared because of an increase in airport taxes," a Melia spokesperson said.
Spain's loss-making flag carrier Iberia, part of International Airlines Group (IAG), is undergoing a major restructuring, with dozens of routes canceled and thousands of staff being laid off.

Sudan almost doubles fuel, gas prices

Sudan almost doubled prices for fuel and cooking gas on Monday, struggling to bring its budget under control in an economic crisis that is stirring widespread discontent.

President Omar Hassan al-Bashir went on television for two hours to announce the plan. He has avoided an "Arab spring" uprising of the sort that has unseated other rulers in the region, but many in Sudan complain about soaring food prices, corruption, violent conflicts and high unemployment.

"We've been just notified of the prices increases," said a petrol station worker, asking not to be named "It's huge leap and we worry that people will be angry."

The Arab African country lost three-quarters of its oil reserves - its main source of revenues and of dollars for food imports - when South Sudan became independent in 2011.

Petrol stations in the capital Khartoum raised the price of a gallon (3.8 litres) of petrol on Monday to almost $3 based on black market prices.

"The government...has no idea of what people are going through. I am ready to join any protest against the lifting," said 41-year old Ahmed Iassan, an unemployed worker.

The government started reducing some fuel subsidies in July 2012. Several weeks of small protests ended with a security crackdown.

It had hoped to sustain the remaining support by boosting gold exports to replace oil revenues, but was thwarted by the recent fall in global gold prices.

A gallon of gasoline now costs £14, up from £8.5, petrol station staff said. The prices for a cylinder of cooking gas rose to £25 from £15.

In a televised news conference, Bashir said late on Sunday Sudan was no longer able to afford the subsidies which he said cost the treasury $15.5bn every year based on the official exchange rate.

Sudan produces too little to feed its 32 million people. Even basic food imports arrive by ship in Port Sudan, before they get trucked for days across the vast country, spurring food price inflation.

The Sudanese pound is worth barely a third of its value against the dollar on the black market at the time of the south's succession.

Opposition activists have criticised the move to cut fuel subsidies but the weak opposition has yet to stir mass protest.

Singapore tightens rules for hiring foreigners

Singapore will require many companies operating in the city-state to consider Singaporeans for skilled job vacancies before turning to candidates from abroad, bowing to public pressure over a surge in foreigners over the past decade.

"The measures might mean more hassle and paperwork for companies, and it might even lower the long-term economic growth rate," said Michael Wan, an economist with Credit Suisse in Singapore.

"But I don't think this will necessarily lower Singapore's attractiveness to companies because there are other factors that they take into account -- such as tax incentives, political stability and access to the Asean region."

Starting next August, firms with more than 25 employees must advertise a vacancy for professional or managerial jobs paying less than S$12 000 ($9 600) a month on a new jobs bank administered by the Singapore Workforce Development Agency for at least 14 days, the Ministry of Manpower said in a statement.

Only after that period can the company apply for an employment pass to bring in a foreign national.

Singapore will also raise the qualifying salaries for employment pass holders to at least S$3 300 a month, up from the current S$3 000, starting in January 2014, reducing the competition for entry-level jobs that typically require tertiary education.

Singapore, a global financial centre and the Asian base for many banks and multinationals, is one of the world's most open economies. Foreigners account for about 40% of the island's 5.3 million population and take up many senior and mid-level positions as well as most of the low-paying jobs that locals shun.

The Association of Banks in Singapore, which represents financial institutions operating in the city-state, said banks will need to adjust their hiring processes to comply with the new rules.

"We need to assess the impact these rules will have," a spokesman for the association added.

Discrimination

Singapore, Asia's main centre for private banking as well as commodities trading, has seen a sharp increase in foreigners over the past decade, triggering a backlash from Singaporeans unhappy about congestion on roads and trains as well as competition for jobs.

There have also been complaints about foreign managers who prefer to hire their fellow countrymen rather than employ Singaporeans.

Earlier this year, several banks admitted to "hot spots" within their organisations "where clusters of employees from the same country appeared to have developed over time", according to advertisements taken up by an organisation backed by the manpower ministry.

The ministry said it will scrutinise all companies, including smaller firms, for signs of discriminatory hiring practices. Firms that fall into this category include those that "have a disproportionately low concentration of Singaporeans" in professional or management positions compared with others in the industry.

"Even as we remain open to foreign manpower to complement our local workforce, all firms must make an effort to consider Singaporeans fairly," Acting Manpower Minister Tan Chuan Jin said in a statement.

"Singaporeans must still prove themselves able and competitive to take on the higher jobs that they aspire to," Tan added, as officials took pains to stress that the new framework is not aimed at forcing firms to hire Singaporeans first.

Singapore has already been making it harder for employers to recruit cheap workers from abroad in a bid to push up the pay of low-income Singaporeans. The measures include lowering the ratio of foreigners a firm can hire relative to the number of local employees and raising the levy firms must pay to hire lesser-skilled foreigners.

Bangladesh pay protests force factory closures

More than 100 Bangladeshi garment factories were forced to shut on Monday as thousands of workers protested to demand a $100 a month minimum wage and about 50 people were injured in clashes, police and witnesses said.
Garments are a vital sector for Bangladesh and its low wages and duty-free access to Western markets have helped make it the world's second-largest apparel exporter after China.
But the $20bn industry, which supplies many Western brands, has been under a spotlight after a series of deadly incidents including the collapse of a building housing factories in April that killed more than 1 130 people.
Workers took to the streets for a third day on Monday, blocking major roads and attacking some vehicles in the Gazipur and Savar industrial zones on the outskirts of the capital, Dhaka.
At least 50 people - including some policemen - were injured, witnesses and police said, as police fired teargas and rubber bullets, and workers responded by throwing broken bricks.
Some workers also vandalised factories, witnesses said.
"We had to take harsh actions to restore order as the defiant workers would not stop the violence," an Gazipur police officer said.
The monthly minimum wage in Bangladesh is $38, half what Cambodian garment workers earn.
The government is in talks with unions and factory owners on a new minimum wage.
Bangladesh last increased its minimum garment-worker pay in late 2010 in response to months of street protests, almost doubling the lowest pay.
Recently, factory owners offered a 20% pay rise which workers refused, calling it "inhuman and humiliating".
"We work to survive but we can't even cover our basic needs," said a protesting woman worker.
The recent string of accidents has put the government, industrialists and the global brands that use the factories under pressure to reform an industry that employs 4 million and generates 80% of Bangladesh's export earnings.
The April 24 collapse of Rana Plaza, a factory built on swampy ground outside Dhaka with several illegal floors, ranks among the world's worst industrial accidents and has galvanised brands to look more closely at their suppliers.
This month, a group of retailers and clothing brands failed to establish compensation funds for the victims of Bangladesh factory disasters, as many companies that sourced clothes from the buildings decided not to take part in the process.
Very low labour costs and, critics say, shortcuts on safety, makes the country of 160 million the cheapest place to make large quantities of clothing, with 60% of clothes going to Europe and 23% to the United States.

UK wants to ease sanctions on gas field

Britain could be close to agreeing a deal to ease sanctions that have stopped gas production from the North Sea's Rhum field, jointly owned by BP and the National Iranian Oil Company, the Mail on Sunday newspaper said.

Production from the field, which once supplied 5 percent of Britain's gas output, has been suspended since 2010 as a result of international sanctions against Iran.

But with signs of a thaw in relations between Iran and the West, the government now hopes to win agreement from the European Union and the United States for a sanctions waiver in the near future, the newspaper said, citing people close to the talks.

One stumbling block to a deal, however, could be concerns from companies involved in financing and servicing the field that any exemption for the producers would not fully protect them from legal action, it added.

A Department of Energy and Climate Change spokesman said: "We are working to ensure the long-term security of the Rhum gas field but no decision has been made at this time on a solution."

A spokesman for BP declined to comment on the possibility of a waiver being granted.

"As operator of the field our priorities are two-fold - to ensure the field remains safe and that we remain compliant with the law," he said. "It is up to the government to decide on the longer-term options."

Sudan to host German business conference

Sudan will host a business conference with German firms to boost economic ties with Europe's largest economy, state media said on Sunday, the second such event between Berlin and the isolated African country this year.

Sudan is trying to attract more investment to overcome an economic crisis after losing most oil reserves with South Sudan's secession in 2011. Most Western firms shun the country due to a U.S. trade embargo over Sudan's human rights record.

The Khartoum conference, from October 28 to 31, is likely to irk human rights activists who criticized Berlin for inviting top Sudanese officials to a similar forum in January.

The Berlin event had been open to South Sudan, but Juba only sent its ambassador in Berlin to avoid contact with arch foe Sudan at time of bilateral tensions, diplomats said. Sudan had sent a high-level delegation to Berlin.

The conference is organized by German and Sudanese business groups with support from both governments, according to the German-African Business Association.

While foreign investors in Sudan often complain of a massive dollar scarcity and shrinking state infrastructure projects, the Berlin-based association painted a much brighter picture.

"Sudan's economic perspectives have developed positively recently. ... The economy has been recovering since southern secession," the German-African Business Association said on its website. It cited opportunities for German firms as Sudan planned to expand its oil, gas and mining sectors.

Most Western countries have only limited ties to Sudan. President Omar Hassan al-Bashir faces charges of war crimes in Darfur at the International Criminal Court.

NEWS,19.08.2013

Rare diamond to go under the hammer

A rare round blue diamond will go under the hammer in Hong Kong in October, with auctioneers hoping the sale will fetch a record-breaking $19m despite fears over the slowing Chinese economy.

Auction house Sotheby's expect the 7.59-carat fancy vivid blue diamond, which is about the size of a shirt button, to set a new record for price-per-carat.

Quek Chin Yeow, Sotheby Asia's deputy chairperson, said Hong Kong was the natural venue to sell the gem, known as "The Premier Blue", with collectors expected to fly in from all over the world.

"While there is a slowdown (in Chinese economy), the number of top-level collectors are still there," he told AFP.

"We have been selling very well in Hong Kong."

Jewellery auctions

Hong Kong has become a centre for jewellery auctions thanks to growing wealth in China and other parts of the region, as well as the region's increasing taste for art.

But there are fears for the future of the Chinese economy, the world's second largest, where growth fell to 7.8% in 2012 - its slowest pace in 13 years.

Blue diamonds seldom hit the market and have been coveted by royals and celebrities for centuries, while a round cut is rarely used in coloured stones because of the high wastage.

The most famous example of a blue diamond is the "Hope Diamond", which was bought by King Louis XIV of France in the 17th Century.

The term "fancy" is used to describe a diamond of intense colour, while a gem's saturation grading ranges from light to vivid for coloured diamonds.

The Premier Blue will go up for auction on October 7. Quek said the owner wanted to remain anonymous.

In April, a rare 5.3-carat fancy deep-blue diamond was sold for £6.2m ($9.5m) at a London auction, then setting a record for price-per-carat at $1.8m.

China bans more dairy products

More New Zealand milk products sold to China have been banned after elevated levels of nitrates were found, raising further concerns over quality and testing in the world's largest dairy exporter in the wake of a contamination scare earlier this month.
New Zealand's agricultural regulator said on Monday it has revoked export certificates for four China bound consignments of lactoferrin manufactured by Westland Milk Products after higher  than acceptable nitrate levels were found by tests in China.
Two of the four consignments had been shipped to China but had not reached consumers, New Zealand's Ministry of Primary Industries (MPI) said.
"Any food safety risk to Chinese consumers is negligible because the quantities of lactoferrin used in consumer products was very small, meaning the nitrate levels in those products would easily be within acceptable levels", Scott Gallacher, the acting director-general of the MPI, said in a statement.
The announcement comes just weeks after Westland's much bigger competitor, Fonterra, said some of its dairy ingredients were contaminated with a botulism-causing bacteria. This prompted a recall of infant formula products, sports drinks and other products in China, New Zealand and other Asia-Pacific nations.
"All of the product has been located, none of it has entered the retail food chain," Westland Chief Executive Rod Quin told . "We're well aware of the wider context of the issue and related concerns, so we've acted to make sure the product doesn't go any further."
China's top quality watchdog said it had halted all imports of the product from Westland and asked other New Zealand dairy companies exporting lactoferrin to provide nitrate test reports.
The General Administration of Quality Supervision, Inspection and Quarantine of China urged the New Zealand government to thoroughly scrutinise its dairy companies as well as their products to ensure the safety of exports to China, New Zealand's top dairy market.
Affected batches
The four consignments were derived from two affected batches of lactoferrin, a naturally occurring protein found in milk, manufactured by Westland at its Hokitika factory on the country's South Island.
Initial investigations pointed to contamination by cleaning products which contain nitrates that were not property flushed from the plant, Quin said.
Privately owned Westland makes about 120 000 tonnes of dairy product each year, exporting the majority. Its production pales in comparison with that of Fonterra, which exports 2.5 million tonnes of product.
ANZ agricultural economist Con Williams said that the 390 kg of affected Westland product was much smaller than the 38 tonnes of contaminated product produced by Fonterra. As a result, he expected it would have limited impact on global demand for New Zealand dairy products.
"The timing isn't ideal. There's heightened concern around food safety issues at the moment especially in the dairy sector in light of the Fonterra issue two weeks ago," Williams said.
"But in terms of the actual issues, it doesn't seem to be substantial ... It looks like only a very small amount of product was affected and it doesn't seem to be a food safety issue."
The two batches of lactoferrin showed nitrate levels of 610 and 2 198 parts per million, respectively, above the New Zealand maximum limit of 150 parts per million.
Westland exported one batch directly to a Chinese distributor, which sold the product on as an ingredient for other dairy products. The second batch was supplied to New Zealand's Tatua Co-operative Dairy Company, and also exported to China.
"MPI, the Ministry of Foreign Affairs and Trade and the companies concerned are working closely with the Chinese authorities on this issue," Gallacher said.
There was no affected lactoferrin used in products in New Zealand or exported elsewhere.
New Zealand relies on diary exports for about a quarter of its NZ$46bn ($37bn) in annual export earnings.

New Zealand plans tainted dairy probe

New Zealand on Monday announced plans for a government inquiry into how ingredients made by dairy giant Fonterra became contaminated with a botulism-causing bacteria, as the country tries to salvage its reputation as an exporter of safe agricultural products.
The inquiry, to be held alongside two internal Fonterra investigations and another by the country's agricultural regulator, will examine how the potentially contaminated products entered the international market and whether adequate regulatory practices were in place to deal with the issue.
"This will provide the answers needed to the questions that have been raised about this incident, both domestically and internationally," said Primary Industries Minister Nathan Guy, who is leading the inquiry along with Food Safety Minister Nikki Kaye.
"It is also an important step in reassuring our trading partners that we take these issues seriously," he said in a statement.
The contamination announced earlier this month has led to product recalls in countries from China to Saudi Arabia.
Fonterra, the world's largest dairy exporter, has come under attack at home and abroad for dragging its feet in disclosing the discovery of the bacteria.
Fonterra chief executive Theo Spierings welcomed the inquiry, saying in the statement that the company would provide all necessary information.
The inquiry will be expected to provide an interim report in around three months.
New Zealand depends on the dairy industry for a quarter of its total exports. China is a major export market for New Zealand's dairy products.
Foreign Affairs Minister Murray McCully is visiting Beijing this week in to smooth relations with the country's biggest milk powder customer, and Prime Minister John Key has said he plans to visit China later this year to discuss the contamination issue after the inquiry results are complete.

Greece sacks privatisation agency chief

Greece dismissed the chairperson of its privatisation agency on Sunday after a newspaper reported that he travelled on the private plane of a businessman who just bought a state company.
Stelios Stavridis is the second head of HRADF to leave in less than six months, reigniting controversy around Greece's ailing privatisation programme which is a key part of its international bailout.
Delays and privatisation receipt shortfalls are a constant headache for the European Union and the International Monetary Fund, which bankroll Greece's €240bn rescue.
The lenders said last month that they would review the way HRADF was operating, after it emerged that the agency would miss its 2013 revenue target by about €1bn.
"Finance Minister Yannis Stournaras asked today for the resignation of HRADF chairperson Stelios Stavridis," the finance ministry said in a brief statement.
A finance ministry official, speaking on condition of anonymity, told that Stavridis's resignation was effective immediately.
The official said the dismissal followed a report in Proto Thema on Saturday that Stavridis travelled last week on the private plane of shipowner Dimitris Melissanidis, a major shareholder of a Greek-Czech consortium which in May agreed to buy a 33% stake in state gambling firm OPAP.
Stavridis was not immediately available for comment.
According to the newspaper report, he admitted he used Melissanidis's plane to travel to his holiday home.
"Melissanidis, who was travelling to France, offered to take me with him to accommodate me," he was quoted as saying by the newspaper.
Stavridis took the flight immediately the signing of an agreement to finalise the €652m OPAP deal, Proto Thema said.
HRADF chief executive Yannis Emiris told he was keeping his post and that Greece's ailing privatisation programme would not suffer from Stavridis's resignation.
"There will be absolutely no delays to the programme," he said, rejecting the idea that the OPAP deal might be reversed as a result of Stavridis's resignation.
The finance ministry official confirmed the OPAP deal would not be affected and the Stavridis's resignation was for "ethical reasons".
Stavridis's predecessor Takis Athanasopoulos stepped down after he was charged by a prosecutor with breach of duty over his former role as chairman of a state utility.

China wants fewer free trade zone curbs

China hopes to suspend its laws governing foreign investment in proposed free trade zones, the cabinet said, in a sign the world's second-biggest economy could open further to foreign competition.
The State Council, China's cabinet, will ask senior members of the National People's Congress, or parliament, for the power to suspend laws and regulations governing both foreign-owned companies and joint ventures between Chinese and foreign companies in free trade zones, including Shanghai, the cabinet said on its website.
The move is aimed at "accelerating transformation of the government's role ... and innovating ways of (further) opening up (to foreign investment)," according to the statement, seen on Sunday. It set no timetable, and gave no further details.
Foreign direct investment in China slowed in 2012 but reversed its decline in the first quarter of this year as confidence improved.
China attracted $38.3 billion in foreign direct investment in the first four months of 2013, up 1.2 percent from the same period in 2012.
China's financial centre, Shanghai, will test yuan convertibility and cross-border capital flows in the free trade zone pilot programme.
The country's new leaders have signalled they want to speed the process of making the yuan fully convertible over the next few years, as part of efforts to boost the currency's use in trade and support wider financial reforms.
Shanghai officials are keen to experiment with freeing up the capital account and yuan convertibility, fearing the city could be left behind as rival centres, such as Hong Kong and Taiwan, move to develop cross-border yuan financial services.
Shanghai stepped up lobbying efforts after the 2012 creation of a special trade zone in Qianhai, near the southern boomtown of Shenzhen and across from Hong Kong, where yuan convertibility is being trialled.
The Qianhai zone, administered by the central bank, the People's Bank of China, lets banks from Hong Kong offer cross-border yuan-denominated loans to mainland firms.
Other initiatives announced in 2013 include trial programmes to smooth the way for foreign firms to move funds in and out of China, cutting the need for approvals and easing bank procedure.

Investors dump India as crisis deepens

Indian policymakers are looking increasingly panicky as they battle the worst currency crisis in more than two decades, and more worryingly there is no sign their remedies are working.
The rupee lurched to a new lifetime low of 62.03 to the dollar on Friday while the benchmark share index posted its biggest one-day fall since September 2011.
"None of the policymakers' Band-Aid measures (from capital controls to tightening liquidity) seems to be working. They have not been able to turn the tide," Rajeev Malik, economist at investment house CLSA, told AFP.
"The government and the Reserve Bank of India are taking fire-fighting measures."
The rupee has lost 57% of its value against the US currency since it peaked at 39.40 rupees to the dollar in February 2008.
The currency's strength began unravelling when Lehman Brothers collapsed later that year, triggering the global financial crisis.
But pressure on the rupee has mounted in the past two years as investor alarm over a slowing economy and a ballooning current account deficit - the widest measure of trade - has grown.
Part of the reason for the currency's most recent slide - it has fallen 13% this year against the greenback - lies outside Indian policymakers' remit.
The currencies of emerging markets globally have fallen on expectations that an increasingly buoyant United States will soon roll back stimulus responsible for funnelling big investments overseas in quest of high yields.
But other reasons for the rupee's drop are home-made - failure to move fast enough on economic reform, a series of government corruption scandals, perceptions of policy paralysis and the record current account deficit, analysts say.
Since June 1, overseas funds have pulled out $11.58bn from India's stock and debt markets.
Investors worry that despite the long-term growth potential of the country of 1.2 billion people, "things are not in shape in the interim period", said investment house IDBI research head Sonam Udasi.
As the rupee's woes have deepened, authorities have responded with a clutch of measures to try to stem its decline and avert a balance-of-payments crisis.
India has painful memories of its 1991 balance of payments crisis when it failed to attract enough foreign currency and was forced to fly 47 tonnes of gold as collateral for an International Monetary Fund loan in what was seen as a national humiliation.
Indian Prime Minister Manmohan Singh, who was finance minister at the time, was moved Saturday to rule out a repeat, saying: "There is no question of going back to the 1991 crisis."
In the past few weeks, Indian policymakers have hiked short-term interest rates, announced plans to allow state firms to raise foreign funds abroad and curbed gold imports.
They have also threatened to imposed higher duties on imported electronic appliances such as fridges, which are made locally.
But it is their most recent step - stealthily announced late Wednesday on the eve of a national holiday - that has fanned the deepest consternation.
The central bank sharply tightened controls on the amount of money firms and individuals can send abroad.
The move looked to observers like a disturbing throwback to the days before India unleashed its economic liberalisation drive in the early 1990s when Indians' access to foreign exchange was strictly limited.
Confederation of Indian Industry president Kris Gopalakrishnan criticised the move as "retrograde".
While the capital controls only apply to local individuals and firms, the restrictions may raise worries among overseas investors that they could be extended to foreign companies operating in India, analysts say.
Under the new policy, Indian individuals can send just $75,000 out of the country annually, down from $200 000 - making it tougher to pay children's overseas university fees, for example.
Companies can invest abroad only 100% of their net worth, down from 400% - though the central bank says firms can ship out more money if they give authorities a good reason for doing so.
"While the authorities aim to reduce foreign-exchange volatility, we fear they may end up sending a panic signal," Nomura economist Sonal Varma said.
There have been no signs so far of domestic capital flight but analysts say the controls may have been tightened to avert one in the face of India's troubles.
The economy expanded last year at a decade-low of five percent and indicators this year have been grim with economists warning about "stagflation" - a combination of high inflation and low growth.
With an election to be held by May 2014 and pro-market reforms divisive, there is no way the Congress government can undertake root-and-branch reforms needed to put the economy back on track, economists say.
"There is a complete lack of faith in the markets" about India's outlook, said Param Sarma, chief executive at consultancy firm NSP Forex.

NEWS,02.03. AND 04.08.2013

BACK WITH VERY NICE POST 

Spanish jobless numbers continue to fall

The number of registered jobless in Spain fell in July from a month earlier, the fifth straight month of declines, the Labour Ministry said on Friday, boosted by seasonal factors including a strong tourist season.
Jobless numbers fell by 1.4% in July, or by 64 866 people, leaving 4.7 million people out of work, the data showed.
The follow a quarterly survey by the National Statistics Institute which reported an unemployment rate of 26.3% in the second quarter with 6 million people unable to find work.
"In annual terms, employment continues to be destroyed and unemployment continues to be generated, but less than before and this points to a change in trend. It suggests that the unemployment rate could be similar in the third quarter as the second," said Estefania Ponte, economy and strategy director at Cortal Consors.
Registered jobless numbers rose 2.4% in July from a year earlier, the ministry figures showed.
Spanish unemployment has soared to record levels since the property bubble burst in 2008 and is expected to remain high for years to come as the battered economy, in recession since the end of 2011, struggles to return to sustainable growth.
The Labour Ministry tends registered jobless figures tend to be lower than the statistics institute's estimates as the disillusioned long-term unemployed, who's benefits end after two years, stop signing on.
According to the statistics institute, some 1.9 million people who had previously held a job had been out of work for more than two years in the second quarter.
The number of people registering as out of work in July fell in all the main economic sectors, with the largest drop seen in the services industry, down 37 614 people, or 1.3%, boosted by a strong tourism season.
Spain's tourist sector, worth over 10% of economic output, has seen a boost this year as holiday makers avoid trouble spots in usually popular destinations in Northern Africa such as Egypt
Unemployed from construction dropped 16 310 people and was down 11 233 people from industry, the ministry said.

 

French winemakers eye China vintage

In a few remote corners of China, two of France's top winemakers have more on their minds than a trade row with their most promising export market.
In three far-flung provinces, a world away from Beijing's allegations of European wine dumping, makers of such lofty French brands as Chateau Lafite-Rothschild and Dom Perignon champagne are investing millions of dollars to produce vintages they hope will put Chinese wine on the world map.
In a country where cheap plonk and overpriced mediocre wines still define the domestic industry, the French are partnering with Chinese investors to produce super-premium wines for increasingly discerning drinkers at the market's top end.
They will likely charge hundreds of dollars per bottle when the wines start appearing in a year or two, turning out deeply rich reds and elegantly sparkling wines for wealthy Chinese drinkers who they hope will be proud to serve local vintages that are the equal of their imported collections.
"China deserves the production of great wines," said Christophe Salin, president of Domaines Barons de Rothschild (DBR), which owns the vaunted Chateau Lafite, Ch. Duhart-Milon and Ch. L'Evangile, among other French labels. "Without wanting to copy Lafite, we wish to produce a great wine on Chinese soil," he added in an interview.
"Shangri-La"
DBR is investing 100m yuan ($16.3m) with partner CITIC, a state investment firm, to develop 25 hectares (62 acres) of vineyards in eastern Shandong province to produce super-premium red wine for the Chinese market.
Moet-Hennessy, the wine and spirits arm of luxury group LVMH Moet Hennessy Louis Vuitton SA, is also looking to make a top-end Chinese red and is planting 30 hectares (74 acres) of grapes in remote mountains of southern Yunnan province.
Moet-Hennessy studied climate and soil conditions at hundreds of locations around China before settling on an area the government calls "Shangri-La", abutting Tibet, to grow Cabernet sauvignon, Cabernet franc and Merlot grapes.
Moet-Hennessy CEO Christophe Navarre won't divulge the investment there but says it is borne two-thirds by Moet-Hennessy and one-third by its Chinese partner, winemaker VATS.
"I dream one day to go back to France with a bottle of red wine produced in the region of Shangri-La and I can say it's the best wine in the world," Navarre said in announcing the venture last year.
Moet-Hennessy's wine portfolio includes the vaunted Ch. Cheval Blanc and Ch. d'Yquem, the world's most coveted dessert wine. Its champagnes include Dom Perignon, Moet & Chandon and Krug - and it is developing vineyards in Ningxia Hui autonomous region in north-central China with a view to producing China's first ultra-premium sparkling wine.
Neither DBR nor Moet-Hennessy plans to market its Chinese wines under existing brands. Both say they want to give the wines a unique Chinese identity a strategy that is questioned by some within the Chinese wine industry.
"If they don't put their brand on it then people won't buy it at a very high price," says Monica He, who works with wine importer Menvis in Beijing.
Growing thirst
DBR's and LVMH's investments into China aim to capitalise on China's growing thirst for premium wines, but could also help their extensive line-ups of mid-priced wines and spirits.
Chinese consumers are drawn to either high-end or cheap wine, leaving a gap in the middle of the market. By producing a Chinese "halo" wine marque, the French winemakers could draw drinkers to their imported mid-range lineup.
The French investors do not have plans to produce still white wines in China, as red wine and champagne are more fashionable for upwardly mobile Chinese wine drinkers.
China is the world's fifth-largest wine consumer, according to a study last year for VINEXPO, an annual wine trade show that alternates between Bordeaux and Hong Kong. The study forecast annual consumption growth in China and Hong Kong at 54.3% between 2011 and 2015, or a billion more bottles every year.
China's wine market is dominated by a few large local producers that make bulk and mid-priced wine, and some premium-priced wines selling for more than $100 a bottle, but these are usually considered far inferior to much cheaper imported wines.
Can China produce something at the highest level?
"The potential there is to make something very, very good," says Jim Boyce, who follows China's wine industry on his blog Grapewallofchina. "There are a lot of people who've been telling me for years that Yunnan is where it's going to happen."
Meanwhile, Beijing and Brussels are in talks to end their trade dispute over wine, with a settlement seen as likely after the two sides struck a deal last week in a separate row over Chinese solar panel exports to Europe. Beijing had launched its investigation into European wine sales after the European Union moved to impose steep import duties on Chinese solar panels.

US hiring slows, but jobless rate falls

US employers slowed their pace of hiring in July but the jobless rate fell anyway, mixed signals that could make the Federal Reserve more cautious about drawing down its huge economic stimulus programme.
The number of jobs outside the farming sector increased by 162 000, the Labour Department said on Friday.
That was below the median forecast in a poll of 184 000. Compounding that miss, the government also cut its previous estimates for hiring in May and June.
At the same time, the jobless rate fell two tenths of a point to 7.4%, its lowest in over four years. Gains in employment fueled some of that decline, but the labor force also shrank during the month, robbing some of the luster from the decline in the unemployment rate.
The data reinforces the view that the job market is inching toward recovery, with the broader economy still stuck in low gear.
"The US economy is grinding along for the better, but it's going to be a long and slow grind," Tanweer Akram, an economist at ING US Investment Management in Atlanta, said ahead of the report.
The question is whether the pace of job gains is enough for the Fed to feel the US economy is ready to get by with less support. The US central bank currently buys $85 billion a month in bonds to keep borrowing costs low.
The stimulus program has lowered interest rates, spurring growth in the country's beleaguered housing market and boosting car sales. Fed Chairman Ben Bernanke said last month the U.S. central bank would likely reduce the level of monthly purchases by the end of the year, and end them by mid-2014.
The Fed's policymaking committee wrapped up a two-day meeting on Wednesday without any change to the program. The panel's statement, however, referenced new factors that could be seen as risks to growth: a recent rise in mortgage rates and persistently low inflation. Central bank policymakers next meet in September.
Structural concerns
The growth in payrolls left the three-month average gain at 175 000. Many economists believe even hiring around that level could lead the Fed to trim its bond buying in September.
But Friday's jobs report could also entertain darker views on the economy.
For one, analysts wonder if the pace of job creation can be sustained given slower-than-expected economic growth.
Gross domestic product, a measure of the nation's economic output, grew at a mere 1.4% annual rate in the first half of the year, down from 2.5% in the same period of 2012.
Most economists expect GDP will accelerate in the second half of this year, which would make it more plausible for the current hiring trend to continue.
But the fact that job creation has been relatively robust despite weak output might point to a frightening possibility: perhaps the economy's growth potential has fallen.
This would mean less output is needed to create jobs, but that incomes would grow at a slower pace over the long run. The prospect of such a structural shift worries economists and investors.
"It's something we have been talking about a lot," Jeffrey Cleveland, a Los Angeles-based economist at investment management firm Payden & Rygel, said ahead of the report.
Friday's report showed the average work week declined to 34.4 hours, while average earnings slipped 0.1%.

 

China opposed to US sanctions on Iran

China, Iran's largest trading partner and top oil customer, repeated its opposition on Friday to tougher US sanctions on Iran after the House of Representatives approved a bill aimed at halting Iran's oil exports.
The bill seeks to cut Iran's oil exports by a further one million barrels per day to near zero over a year, an attempt to reduce the flow of funds to Tehran's disputed nuclear programme. The legislation provides for heavy penalties for buyers who do not find alternative supplies.
"China has long advocated resolution through dialogue and negotiations and opposes unilateral sanctions from one nation based on its domestic laws," the Ministry of Foreign Affairs said in a faxed statement .
"In particular, it opposes sanctions that will hurt the interests of a third party," it added, without elaborating.
The success of any toughening of the sanctions will depend on China, Iran's top customer, which has repeatedly said it opposes unilateral sanctions outside the purview of the United Nations.
China reduced oil purchases from Iran by 21% last year, but that was partly on account of differences in the first quarter over the renewal terms of annual contracts and shipping delays.
Chinese oil industry officials have said refiners are likely to cut shipments 5% to 10% this year from last. They cut imports 2% in the first six months of the year.
China has consistently advocated resolving the dispute over Iran's nuclear programme through talks and has opposed what it views as unilateral sanctions imposed by the United States and European Union made outside the framework of the United Nations.

Japan policies involve risks - IMF

A failure of the economic policies promoted by Japanese Prime Minister Shinzo Abe would take a toll on the global economy, the International Monetary Fund said late Thursday.
Abe has advocated aggressive monetary easing steps to reinvigorate the world's third-largest economy and pull it out of the deflation that has lasted more than a decade.
The IMF has supported the policies, and said in a report released in Washington that Abe's economic programme, so-called Abenomics, "would have clear positive net growth spillovers on the global economy."
However, the report added that without structural reforms, fiscal consolidation, and the achievement of a new inflation target, output in Japan could decrease by 4% after 10 years.
The IMF simulations suggested that global output losses could reach 2% of GDP if investors in Japan were to reconsider the risk of their investments, leading long-term interest rates to rise 2 percentage points, the report said.

EU signs off on China solar deal

European Union officials endorsed a deal on Friday to settle a dispute with China over solar panels, the biggest trade row to date between the two powers, after winning almost unanimous backing from member states.
The agreement will be officially published on Saturday and takes effect on August 6. Chinese firms who agree to its terms will avoid duties that the 28-nation EU had planned to impose.
In a statement, the European Commission, the EU's executive arm, said it had received almost unanimous support but declined to give details on any possible abstentions.
"We can't go into details. A huge majority of member states voted in favour. No member state voted against," a Commission spokesman said.
The EU trade chief and his Chinese counterpart agreed late last month to set a minimum price for panels from China near spot market prices.
European solar panel makers have accused China of benefiting from huge state subsidies, allowing them to dump about €21bn ($27.79bn) worth of below-cost panels in Europe last year.
The EU had planned to impose hefty tariffs from August 6 but, wary of offending China's leaders and losing business in the world's No. 2 economy, a majority of governments, led by Germany, opposed the plan, allowing for the compromise deal.
Europe is China's most important trading partner, while for the EU, China is second only to the United States. Chinese exports of goods to the bloc totalled €290bn last year, with €144bn going the other way.

Fukushima water rises above barrier

Radioactive groundwater at the crippled Fukushima nuclear plant has risen to levels above a barrier being built to contain it, highlighting the risk of an increasing amount of contaminated water reaching the sea, Japanese media report.
The Asahi newspaper, citing data from a meeting of a task force working on the Fukushima clean-up at Japan's nuclear regulator, estimated that the contaminated water could swell to the ground surface within three weeks.
The latest revelation underscores the hurdles facing Tokyo Electric Power (TEPCO) 2-1/2 years after a massive earthquake and tsunami destroyed the Fukushima plant, triggering the world's worst nuclear disaster since Chernobyl.
One of Tepco's biggest challenges is trying to contain radioactive water that cools the reactors as it mixes with about 400 tons of fresh groundwater pouring into the plant daily.
Tepco has been injecting a chemical into the ground to build barriers to contain the groundwater, but the method is only effective in solidifying the ground from 1.8m below the surface, whereas data from test wells shows the contaminated water has risen to one metre below the surface, the newspaper said.

NZ milk powder scare over botulism

China halted imports of all New Zealand milk powder, New Zealand's trade minister said on Sunday, after bacteria that could cause botulism found in some dairy products raised food safety concerns that threatened its $9.4bn annual dairy trade.
Global dairy trade giant Fonterra said on Saturday it had sold contaminated New Zealand-made whey protein concentrate to eight customers in Australia, China, Malaysia, Vietnam, Thailand and Saudi Arabia for use in a range of products, including infant milk powder.
Nearly 90% of China's $1.9bn in milk powder imports last year originated in New Zealand, so a prolonged ban could result in a shortage of dairy products in China.
Foreign-branded infant formula in particular is a prized commodity in China given consumer distrust of Chinese brands after a series of domestic food safety scandals.
New Zealand's neighbour Australia was caught up in the ban after some of the contaminated whey protein concentrate was exported there before being sent on to China and elsewhere.
"The authorities in China, in my opinion absolutely appropriately, have stopped all imports of New Zealand milk powders from Australia and New Zealand," said New Zealand Trade Minister Tim Groser.
Ingredient
"It's better to do blanket protection for your people and then wind it back when we, our authorities, are in a position to give them the confidence and advice that they need before doing that," he said.
There was no official word of a ban from Chinese authorities on Sunday.
Chinese state radio said on Saturday that Fonterra was notifying three Chinese firms affected by the contamination.
Some of China's biggest food and beverage companies are said to be customers of Fonterra, using its milk powder as an ingredient in everything from confectionery to cheese on frozen pizza.
Fonterra is a major supplier of bulk milk powder products used in formula in China but it had stayed out of branding after Chinese dairy company Sanlu, in which it had held a large stake, was found to have added melamine  often used in plastics  to bulk up formulas in 2008.
More than six children died in the industry-wide scandal and hundreds were made sick.

Goldman, LME face legal challenge

The London Metal Exchange and Goldman Sachs have been named as co-defendants in a US class-action lawsuit alleging anti-competitive behaviour in aluminium warehousing, said Hong Kong Exchanges and Clearing (HKEx).
Goldman on Wednesday tried to diffuse years of frustration over long waiting times and inflated prices at metals warehouses across the world by offering immediate access to aluminium for end users holding metal at its Metro warehouses.
Criticism of banks that own commodity assets and trade raw materials has ratcheted up in recent weeks, with the US Department of Justice starting a preliminary probe into the metals warehousing industry, sources said.
Britain's financial watchdog is also investigating the LME's warehousing system.
The lawsuit alleges "anti-competitive and monopolistic behaviour in the warehousing market in connection with aluminium prices", LME owner HKEx said in a statement on Sunday.
The lead plaintiff in the lawsuit, filed on Friday in the US District Court in Michigan, is Superior Extrusion  an end user of aluminium.
"LME management's initial assessment is that the suit is without merit and LME will contest it vigorously," HKEx said.
Customers and US lawmakers have accused Goldman and other warehouse owners of artificially inflating waiting times to boost rents for warehouse owners and lift metal prices.
London Metal Exchange aluminium for three months delivery closed at $1 809 per ton on Friday.