In a race against time, hundreds of thousands of
villagers are continuing to reinforce flood defences around the lake.
Its level has risen again overnight, and in some
places water has begun to crest over the dykes.
Torrential rains have raised water levels in recent
weeks, threatening a disaster on the scale of 1998, when the lake and
the Yangtze river that flows into it burst their banks.
Rupert Wingfield-Hayes, reporting from Dongting Lake,
says the next 24 hours are likely to be critical in this massive battle
Every village along the lake shore has turned out in
force to fill sandbags and plug any holes that appear.
With the water levels still rising and a strong
breezes now blowing across the lake, waves have begun crashing into the
tops of the dykes and even with the main dykes holding, the cost has
already been high.
Sixteen people have been killed and 27,000 houses
have collapsed as a result of flooding in the area, according to Chinese
Nearly 500,000 hectares (1,250,000 acres) of crops
have already been ruined.
If any of the dykes were to burst, the damage could
be many times greater.
Large stretches of farmland and two cities Changsha
and Wuhan, with a combined population of 13 million are at risk.
JAPAN'S TRADE SURPLUS SOARS
Japan's trade surplus soared by more than 80% in July
compared with the same month of last year, official figures showed.
But analysts warned that rise was powered by exports,
while sluggish imports showed the world's second biggest economy remains
still risks stagnation at home.
The overall rise in the trade surplus was less than
expected, and the surplus with the United States, Japan's biggest
trading partner shrank.
The trade surplus was 752bn yen ($6.3bn: £4.1bn) in
July, the Finance Ministry said.
Turning to Asia exports rose 8.9% to 4,395bn yen, but
imports were up by a mere 0.6% to 3,643bn yen.
Trade with other Asian countries was behind the jump
Japan's trade surplus with the rest of Asia rocketed
upwards by more than 300%, boosted by rising sales to fast-growing
As well as shipping IT parts to China for processing
into finished goods, Japanese firms are increasingly selling finished
consumer goods such as cars to China.
Rapid growth in sales to Asia was "likely to
continue", said Koji Hiiragi, an economist at the UFJ Institute.
"The current period of high growth is likely to
last through this year," he said.
Exports to the rest of Asia were up 19% to 1,929bn
yen while imports from Asian countries rose 0.4% to 1,526bn yen.
Analysts said that the slant towards Asia revealed by
the data reflected the weakness of the US economy, and reflected an
Soichi Okuda, senior economist at Aozora Bank, said:
"The yen is getting stronger and the US economy is not in
particularly good shape, which had an impact, and this may well continue
in the future."
EUROPE REJECTS SUGAR 'EXCLUSION' CHARGE
The European Union has rejected an accusation from
the British development charity, Oxfam, that it is unfairly excluding
sugar farmers in developing countries from European markets.
Oxfam says the EU's sugar policy makes profits for
Europeans while keeping developing countries poor, and is calling for an
immediate 25% cut in EU sugar quota production.
But an EU spokesman, Thorsten Muench, said the bloc
was taking the lead in opening its sugar markets to the Third World.
He said the EU had imported 850m euros ($833m) of
sugar from developing countries in the year 2000, more than the combined
total imported by the United States, Japan, Australia and Canada.
US ECONOMY TRAPPED IN TRADE GAP
The United States has reported its second-largest
trade deficit on record.
During June, the trade gap narrowed only slightly, as
demand for imports reached its highest level for 15 months.
The US Commerce Department said June's trade deficit
came in at $37.2bn (£24.4bn), compared with May's record deficit of
Imports of goods and services increased by 0.5% to
$119.2bn, as imports of consumer goods, such as clothing and electrical
goods, reached a record high of $26.2bn.
US exports grew by 1.7% to $82bn, helped by increased
sales of agricultural products.
The biggest trade gap was recorded with China, where
a deficit of $8.5bn emerged, even though US exports to China climbed to
a record $2.2bn.
The latest figures mean the US trade gap grew by 8.1%
to $206bn during the first six months of the year, compared with the
first half of 2001.
SIGN OF STRENGTH IN GERMAN ECONOMY
Germany's economy, the biggest in Europe, has shown
stronger than expected growth in April, May and June.
Healthy spending by consumers helped spur growth of
0.3% during the three months, the Federal Statistics Office said.
The German finance ministry said the figures showed
that the country's fragile economy was recovering well.
But analysts warned that 0.3% growth was still
feeble, and some continued to be nervous of prospects for the second
half of the year.
The German economy — and the high level of
unemployment — has been under the spotlight ahead of the general
elections on 22 September.
There have been growing fears that the impact of this
month's damaging floods may tip the economy, which suffered recession
during the last half of last year, back into a downturn.
Promised tax-cuts have already been delayed in order
to pay for the clean-up operations.
US ANNOUNCES STEEL WAR EXEMPTIONS
The United States has decided to exclude a further
178 steel products from its controversial protective tariffs.
The move is being seen as an attempt to head off a
damaging trade war.
The tariffs were imposed in March in an attempt to
protect the US steel industry but now nearly a quarter of the steel
covered on the original order is exempt from the tariffs.
The US has denied that its decision was influenced by
threats of retaliation from the European Union and Japan but steelmakers
in the US already fear that the tariffs will no longer be effective.
The European Union (EU) has said it is examining the
new exclusions and would offer an appraisal on Friday. The EU will
decide in late September whether it will put retaliatory duties on goods
from the US. The exemptions now cover 25% of Japan's exports to the US.
GERMANY STRUGGLES TO CONTAIN RIVERS
The battle to shore up dams along the swollen River
Elbe and its tributaries is continuing in Germany despite flood waters
receding in some southern parts of the country.
Thousands of relief workers, including some sent by
foreign governments, are taking part in the sandbagging effort in
central and northern Germany.
The high water is now approaching the mouth of the
Elbe in Hamburg, but officials say sodden dikes could still burst
upstream, where waters are still higher than normal and moving fast.
STOCK MARKETS STEAM AHEAD
Shares on Wall Street have closed above a key
psychological level, buoying hopes that a recovery is underway.
The Dow Jones Industrial Average closed 97 points
higher at 9,054 points in low-volume trade, the first time it had closed
above 9,000 since 9 July.
The technology-heavy Nasdaq index rose 13.69 points
to 1,422.94, its highest close since 5 July.
ASIAN TYCOON SNAPS UP PHARMACY GIANT
Hutchison Whampoa, the ports to telecoms conglomerate
controlled by billionaire Li Ka-shing, is to buy Dutch pharmacy giant
Kruidvat. The 1.3bn euro ($1.2bn; £830m) takeover, which will give
Hutchison control over the UK's Superdrug stores, will allow the
formation of one of the world's largest health and beauty chains.
IVORY COAST INCREASES COCOA TAX
The world's leading cocoa grower, Ivory Coast, has
raised export taxes on beans and other products to exploit high world
The tax on cocoa beans has been raised by 22% to 220
CFA francs (£0.20) per kilogramme.
Rolls-Royce has announced a sharp fall in profits.
The engine-maker's pre-tax profits fell 45% to £104m ($158.6m) in the
six months to the end of June.
ALVIS LEADS IN UK TANK RACE
Aero-engine manufacturer Rolls-Royce has sold its
tank-making unit Vickers to Alvis, in a move that completes the
consolidation of the British armoured vehicle industry.
The deal looks set to make Alvis the country's
biggest manufacturer of armoured cars.
Lufthansa's net loss came in at 27m euros for the
January to June period, a sharp improvement on last year's 43m euros.
CITIES TO DRIVE WORLD ECONOMY
The World Bank has urged governments to act
decisively at the Johannesburg summit to tackle global poverty and
But in an upbeat assessment, it says that in the next
50 years, the global economy could expand by four times, reaching
$140,000bn compared with today's $35,000bn.
With world population stabilising at around 9 or 10
billion, compared with 6 billion now, average living standards could be
ANC URGES ECONOMIC BOOST FOR BLACKS
The South African government must step up its black
economic empowerment initiatives to prevent a popular revolt, the
African National Congress [ANC] has said.
This view is expressed in a document prepared by the
ANC ahead of its policy conference next month.
Max Sisulu, head of the ANC's economic transformation
committee, said without more emphasis on black economic ownership South
Africa's democracy could be undermined.
ANGLO AMERICAN QUITS ZAMBIA
Anglo American has formally quit its mining
operations in Zambia. In reaching a final agreement with the government,
Anglo has offered $30m and a loan of $26.5m to keep the operations
running at Konkola Copper Mines [KCM] while new investors are found.
Zambia's finance minister, Emmanuel Kasonde, told the
BBC's World Business Report that the government remained committed to
the privatisation programme and was determined that KCM should remain in
HSBC BUYS MEXICO'S BIGGEST BANK
British banking group HSBC has agreed to buy Mexico's
biggest bank, Grupo Financiero Bital, in an all-cash deal worth more
The acquisition, which has been in the pipeline for
several months, comes despite a new mood of caution towards Latin
American investments in the wake of Argentina's economic meltdown.
QANTAS PROFITS FLY HIGH
Australia's flagship carrier Qantas has reported
strong results, buoyed by a 40% jump in profits on domestic routes.
The firm saw its profits rise by 3% to Aus$428m
during the financial year which ended in 30 June.
While pre-tax profits from international operations
were more than halved, domestic profits rose to Aus$468m.
UNIONS PREPARE 'PRIVATISATION' ATTACK
Trade unions are preparing for the showdown over
"privatisation" in public services postponed last year in the
wake of the US terror attacks.
Leading unions are set to oppose the government over
the role of private services in running schools and hospitals at next
month's annual Trades Union Congress in Blackpool.
KPN HIT BY 3G LOSSES
KPN's joint venture KPNQwest filed for bankruptcy
Dutch telecoms giant KPN has posted a $9.2bn (9.4bn euros) net loss for
the second quarter but sought to reassure investors by promising that
earnings were improving.
BRAZIL WOOS NERVOUS US BANKS
Brazil's top financial officials are pressing for a
meeting with major American banks to ask them to continue to roll over
loans to Brazilian firms.
Brazil's economy is suffering because overseas banks
are cutting off loans or tightening their credit terms due to fears that
Brazil may default on its foreign debts after the October presidential
MALAYSIA URGES STOCK MARKET SHAKE-UP
Ninety-nine Malaysian firms have been told to sort
out their debt problems or face expulsion from the stock market.
The firms have until the end of this month to submit
restructuring proposals to the country's Securities Commission, and
avoid the watchdog's wrath.
UK PUBLIC FINANCES BACK IN THE BLACK
The UK's public finances enjoyed a return to positive
territory in July, although the surplus was smaller than last year as
spending increased, official figures have revealed.
Data from the Office for National Statistics (ONS)
showed a public sector cash surplus of £7.1bn last month, compared with
a deficit of the same amount in June.