Whether the final cost rises as high as $95bn — the
low-end estimate is $83bn will depend largely on how many of those jobs
are permanently shifted out of the city, said the Comptroller, William
The city had been suffering from a mild downturn
before the twin towers were hit by hijacked jetliners, collapsing both
and killing thousands.
But the tragedy and its aftermath made things worse,
snuffing out a nascent recovery which could have created 60,000 new
posts and destroying property which — the Comptroller estimates —
will cost $21.8bn to replace.
Added to which, many of the victims of the disaster
were well-paid financial operators. Given an average $130,000 annual
salary, the city estimates, their lifetime earnings would have
contributed $8.7bn to the city's economy.
In the wake of the disaster, New York had an
unemployment rate of 7.7% in July, up from 5.8% at the same time last
year and well above the national average of 5.9%.
Part of the job losses have come from firms including
the high-profile financial firms which were forced to scramble for space
in New Jersey, across the Hudson River — which have yet to return.
About 13 million square feet of office space enough
to fill the business district of Atlanta or Miami — was wiped out.
The federal government has come through with promises
of aid totalling $21.4bn, of which $2.7bn has thus far arrived.
WB REPORT ON DEVELOPMENT
The World Bank has urged more balanced global
approach to development in South Asia. "The World Development
Report (WDR) 2003" of the World Bank released here on Monday also
called upon heads of state, ministers, private sector leaders and civil
society representatives at the World Summit on Sustainable Development
in Johannesburg to reach an agreement on steps that can be taken to
ensure that poverty-reducing growth does not come at great cost to
The next 50 years, the report said, could see a
fourfold increase in the size of the global economy and significant
reduction in poverty, provided that governments act now to avert a
growing risk of severe damage to the environmental and profound social
"In nearly 50 years, the world could have a GDP
of $140 trillion and a total population of nine billion up, from six
billion today. Without better policies and institutions, social and
environmental strains may derail development progress, leading to higher
poverty levels and a decline in the quality of life for everybody",
the report said.
Talking about Pakistan, the report pointed out, that
resource degradation has reduced overall productivity growth from
technical change, education, and infrastructure investment by one third.
It said that intensification of land and water use in
Pakistan and India have resulted in resource degradation that is
lowering overall productivity growth.
The WB report also said that today more poor people
depend on fragile natural resources to survive. Similarly, trust between
individuals, which can be eroded or destroyed by civil unrest, is a
social asset with important economic benefits, since it enables people
to make agreements and undertake transactions that would otherwise not
US SENATE VOTES TO ARM PILOTS
The US Senate has overwhelmingly approved a bill that
would arm airline pilots on a voluntary basis.
Endorsed by a vote of 87-6, the controversial measure
gives commercial pilots the authority to use lethal force in defence of
It is part of an amendment to a bill creating US
President George W Bush's new Homeland Security Department, which the
Senate began debating this week.
The House of Representatives has already passed
legislation that would allow all 70,000 commercial airline pilots to
carry guns in the cockpit on a voluntary basis after training by a
The moves follow concerns about aircraft security in
the wake of the 11 September attacks.
UK EXPORTERS 'LOSE LIKING FOR EURO'
British membership of the euro has fallen below 50%
for the first time since the cash launch of the currency, a survey has
"The introduction of the euro on the continent
eight months ago gave a positive boost to UK business views of the
currency, but this has now waned," said David Coles, managing
director of DHL UK, which conducted the survey.
The survey suggested 49% of UK exporters believed
British membership would have a positive impact on their businesses.
This compared with a figure of 58% for April-June of
this year and 52% for January-March.
The reading has yet to rescale levels hit immediately
after the euro's January 1999 launch as a virtual currency when 71% of
UK exporters favoured British membership.
UK INTEREST RATES HELD STEADY
UK interest rates have been left unchanged at 4% for
the 10th month in a row.
The Bank of England's decision to hold rates steady
at a 38-year low was widely predicted by economists, who pointed to
uncertainty about the health of the US economy coupled with nervous
trading in financial markets.
Although major stock markets may have steadied after
steep falls and roller-coaster days in the past couple of months, the
Bank did not want to deliver any shocks by raising rates now, economists
ARGENTINA DELAYS $3BN LOAN REPAYMENT
Argentina has been told it can delay a $2.8bn
(£1.8bn) loan repayment for one year.
The International Monetary Fund (IMF) agreed to defer
the payment, due on 9 September, and said the situation in Argentina
remained "very difficult".
It is the second time in three months that the loan
has been extended.
The country is struggling with debt and a run on its
banks ended with bank accounts being frozen.
ASIAN SHARES FOLLOW WALL STREET LOWER
Shares have fallen sharply once again in Asia,
intensifying the gloomy tone set by Wall Street on Thursday.
In the mid-afternoon Tokyo time, the Nikkei 225 share
index was down 142 points at 9,080, having briefly dipped below the
On Thursday, New York's Dow Jones Industrial Average
closed down 141 points at 8,283.
Hong Kong shares were down another 0.5% by the middle
of the trading day, with Sydney down 1% and Seoul by almost 2%.
Earlier, stocks in London and the other European
markets had fallen sharply because of worries about the economy and the
situation in the Middle East.
But the FTSE 100 index of leading shares recovered
most of its losses to end down 16 points at 4,011.
German unemployment has inched downwards, but remains
above the crucial 4 million mark just three weeks before a hotly
contested general election.
The Federal Labour Office reported that unadjusted
unemployment fell by 28,700 in the month to 4.018 million in August, a
rate of 9.6%.
URGENT TALKS FOR BRITISH ENERGY
The UK's biggest electricity generator British Energy
has entered urgent talks with the government to try to prevent it
On Thursday night the company — which runs the UK's
nuclear power stations — warned that it faced insolvency unless
immediate financial help was found.
North Korea has announced that it will open up its
companies to more foreign investment, as part of a new policy to
liberalise its economy. The Korea Trade-Investment Promotion Agency (Kotra)
said that it would now allow foreign investors to take stakes in Korean
companies of more than 50%.
SUMMIT BOOSTS SOUTH AFRICA'S
A burst of new car sales in South Africa could lead
to a further rise in the country's interest rates.
Economists believe South Africa's central bank could
put up rates for the fourth time this year when it meets next week.
Their view was bolstered by new car sales figures for
August which showed robust consumer demand despite price rises.
Sales of new cars in August rose to 30,525, up from
29,777 in the same month last year, figures from the National
Association of Automobile Manufacturers of South Africa (Naamsa) showed.
SRI LANKA LOOKS TO FOREIGN INVESTORS
Sri Lanka is considering tapping the international
capital markets for about $300m to help rebuild its shattered economy.
This would be the country's first foray into the
markets since it agreed a ceasefire with separatist Tamil Tiger rebels
SURPRISE RISE FOR UK INFLATION
UK inflation has risen higher than expected, casting
doubt on the need for another interest rate cut.
The annual underlying rate of inflation rose by half
a percentage point last month to 2%, official figures showed on Tuesday.
But it was still well below the Bank of England's
target rate of 2.5%, with 1% leeway either way.
The headline rate of inflation, which includes
mortgage interest payments, also rose half a percentage point to 1.5%,
the Office for National Statistics (ONS) said.
EU NEARS DEAL ON NEW COURT
The European Union has taken a step forward in its
attempt to forge a common position over Washington's demands that US
citizens should be granted immunity from prosecution before the new
International Criminal Court (or ICC).
Top EU legal experts, meeting in Brussels, agreed
that a request for blanket immunity for all Americans was unacceptable.
The row over the ICC has split the EU, with Italy and
Britain hinting they could sign bilateral agreements with the US.
But there is hope a common stance could be achieved
by the end of the month.
HOUSE PRICE RISES 'COOLING'
Soaring UK house price inflation is showing the first
signs of cooling down, according to the Halifax.
The giant mortgage lender said house prices rose at
an annual rate of 18.8% in August, compared with 20.8% in July.
Average earnings have failed to keep pace with house
prices over the last 12 months, the Halifax said.
UK MANUFACTURING 'IN DECLINE'
Britain's manufacturing firms remain stuck in the
doldrums, according to the Engineering Employers' Federation (EEF).
Engineering output and orders have now been shrinking for a year and a
half, according to an EEF survey of 1,200 firms.
'EUROFLATION' SPARKS GREEK BOYCOTT
Greece's main consumer group has claimed massive
support for a boycott of shops on Tuesday, as part of continuing
protests over price rises caused by the introduction of the euro.
"On Tuesday we are not buying anything. No food,
no clothes, no fuel. Absolutely nothing," the Institute of Consumer
Protection (Inka) said in a statement.
AUSTRALIAN ECONOMY GOES DOWNHILL
Australia's previously impressive rate of economic
growth has slowed for the third consecutive quarter.
Despite the diminishing strength, the economy still
managed to expand by 0.6% compared with the previous three months and by
3.8% compared with the same months a year earlier.
Treasurer Peter Costello blamed the slowdown which
was worse than expected — on falling stock markets and the worsening
Retail spending also fell for the first time in 10
months, while a survey showed business confidence for the last half of
the calendar year had slumped.
SUMMIT DEAL ON DRINKING WATER
Negotiators at the world summit in Johannesburg have
agreed on action aimed at halving the number of people in the world
without water and sanitation by 2015.
About 1.1 billion people around the world lack access
to adequate drinking water, according to the United Nations — many of
them in Africa.
Richard Jolly, a UN adviser on water, said African
ministers had agreed that a permanent African Ministers Council on Water
(AMCOW) would meet regularly "to find ways of providing water to
Mr Jolly announced the deal by the WaterDome, an
exhibition site in Johannesburg where water projects are on show during
the 10-day World Summit on Sustainable Development.
PORTUGAL DEFICIT 'TO MEET EU STANDARDS'
Portugal's public deficit is set to come in within EU
standards this year, reducing fears of EU sanctions.
Portugal's statistics office INE predicts the year to
end with a 2.84% deficit, just within the 3% maximum limit set for
members of the eurozone.
The deficit will thus have shrunk dramatically from
4.1% of the country's output in 2001.
The news came just over a month after the European
Commission said it would initiate a sanctions procedure against Portugal
due to 2001's excessive deficit.
SUDAN PLANS NILE DAM
Sudan is preparing to short-list companies to build a
$1.73bn dam on the Nile in the country's north to provide more
electricity and cut flooding.
The Hamdab Dam in Merowe, about 400 km (250 miles)
north of Khartoum, will triple electricity generation in Sudan, Mutaz
Musa Abdalla Salim, finance director for the dam project told Reuters
He said the government would next month short-list
four firms from 69 to submit final bids to build the $650m dam wall.
Seven companies are competing to build the
electricity turbines and generators at a cost of $700m. The dam is
expected to be finished in about six years' time.