INTERNATIONAL

 

Jan 05 - Jan  11 , 2004

 

1.INTERNATIONAL

2. INDUSTRY

3. FINANCE

4. POLICY

5. TRADE

6. GULF


UK 'IS WORTH NEARLY 5 TRILLION'

Britain is worth 4,983,000,000,000, according to new government figures. The figure, almost five trillion, includes both the country's physical assets, such as all its buildings, and virtual assets like software patents. It works out at almost 85,000 for every man, woman and child living in the UK, says the Office for National Statistics. The study is used to help economists predict future growth, and is more detailed than previous reports. The housing boom has resulted in residential homes making up 55% of the total, up from 44% in 1994.But the rise in house prices mean the 2.7 trillion contribution is twice the figure for ten years ago.

 

 

The second biggest price tag 565bn is attached to commercial and public buildings, while civil engineering infrastructure such as roads, railways and pipelines are valued at 537bn. Manufacturing has remained static since 1998 with a value of 200bn. The Government is well into the red, with a net worth of -124bn after deducting the national debt and other obligations."Economists use this information to look at wealth, and is particularly interesting for looking at household wealth," said ONS statistician Ian Hill. "It helps them make well-founded predictions of what is going to happen in the future."

DATA BOOSTS HOPE OF US RECOVERY

Figures out of the US showed that the world's largest economy is well placed to continue its recovery next year. Consumer spending and sentiment has remained buoyant. The Commerce Department confirmed that the economy grew at its fastest pace for 20 years during the third quarter. Although economists warn that it is still early days, there is growing hope that interest rates and tax cuts have done enough to turn the US around.

The capture of deposed Iraqi leader Saddam Hussein and a small dip in unemployment also has helped convince people that the outlook is improving. Stock markets have reflected this new-found optimism, with the US's benchmark Dow Jones Index climbing to a 19-month high this week. Economic growth in the three months to September was 8.2%, according to revised figures released by the Commerce Department. The figure the best for almost two decades outstrips the initial estimates of 7.2%.

While expansion is not expected to continue at this pace next year, experts still expect it to be much quicker than in Europe. Research and analysis company the Economist Intelligence Unit forecasts US growth of 4.2% for next year, up from an initial target of 4%. That's about double the rate in Europe. US consumer sentiment, though it dropped slightly this month, was still higher than many analysts had forecast. The closely watched University of Michigan index had a reading of 92.6 in December, down from November's 93.7.

DOLLAR SLUMPS TO NEW RECORD LOW

The US dollar is continuing to fall to record new lows against the euro. The euro had yet again hit a new all time high of $1.262, as the dollar strayed even further beyond the psychological 1.25 level. Ongoing concerns about the US current account deficit, security, and the discovery of a case of BSE, or mad-cow disease, have all dented confidence. Analysts are predicting that the weak dollar trend will continue into 2004, as investors favour the euro.

BOOM TIME FOR INDIA'S ECONOMY

India's economy has joined the ranks of the world's fastest growing economies, official figures show. The economy expanded at a scorching 8.6% between July and September. Experts put the surge down to the best monsoon in a decade India is heavily dependent on agriculture which accounts for 25% of its gross domestic product. The growth put Asia's third-largest economy firmly on track to achieving the government's growth target of 7% for the year to March, economists said. DH Panadikar, economist at Delhi's RPG Foundation said: "It's mainly the agriculture sector that helped. I expect growth to be around 7.0 to 7.5% for the full year."

NIKKEI SCORES 24% GAIN FOR 2003

Japan's main stock market has ended 2003 with its first 12-month gain in four years. After a short session on Dec 30, Tokyo's Nikkei 225 index ended up 1.7% at 10,676.64, boosted by last-minute euphoria on Wall Street overnight. The Nikkei has risen 24% since the start of this year. Dec 29 boost to the markets in New York pushed the technology-heavy Nasdaq Composite the bellwether of the hi-tech boom of the 1990s above 2,000 for its best close since January 2002.

The 1.7% gain was accompanied by a rise of 1.2% for the blue-chip Dow Jones average, which finished at 10,450. The Dow has itself risen 25.3% this year with two trading days to go in 2003, although the Nasdaq's leap of more than 50% puts it in the shade.

TERROR ALERT SHUT ALASKA OIL PORT

A major oil terminal in Alaska was temporarily shut because of a possible terrorist threat, it has emerged. The transfer of oil onto tankers at Valdez port, in Prince William Sound, was halted temporarily. A US Homeland Security spokesman said it was part of "a continuing effort to ensure the security of our homeland". The terminal was already subject to restrictions imposed last September, including a prohibition zone of 200 metres around all tankers.

GERMANY INVITED TO D-DAY EVENTS

France has invited Gerhard Schroeder to ceremonies to mark the 60th anniversary of the D-Day landings the first time a German leader has been invited. The move marks the growing ties between French President Jacques Chirac and the German chancellor. Allied forces disembarked on the Normandy coast in the first step towards liberating France from German occupation during World War II. Mr Schroeder has said he will participate in the ceremonies.

CAUTIOUS IRISH LAUNCH EU PRESIDENCY

Ireland has taken over the European Union's revolving six-month presidency, inheriting the task after a widely-criticised Italian spell in charge. Ireland will preside over the EU's biggest round of expansion yet, when 10 Mediterranean and Eastern European countries join in May. But it also faces handling the aftermath of the collapse of talks on Europe's constitution. Irish Taoiseach Bertie Ahern warned it would take time to resolve.

MEXICAN CAPITAL HIT BY EARTHQUAKE

A strong earthquake has rocked Mexico City and Acapulco, although no damage or injuries were immediately reported. City office workers rushed from swaying buildings, and cars pulled over to the roadside to ride out the tremors. The quake, at about 1735 local time (2335GMT), centred in nearby Guerrero state and had a magnitude of 5.3. About 10,000 people died when Mexico city was hit by a major quake in 1985. The city has implemented some of Latin America's toughest building codes.

 

 

CHINA GETS FOREIGN CREDIT CARDS

Citibank and HSBC have become the first foreign banks to get permission for issuing credit cards in China. Both are now licensed to give cards that can be settled in either the yuan, China's currency, or the US dollar. There are more than half a billion cards in circulation in China, the vast majority of which are debit cards drawing on accounts at Chinese banks. Less than 1% of them are true credit cards, partly because of the paucity of reliable data on credit-worthiness.

SRI LANKA TELECOM TO ISSUE BONDS

Sri Lanka Telecom intends to raise more than $50m (28m) through a bond issue to widen its mobile phone operations. The firm, the country's largest listed company, currently has 150,000 users of its mobile services, 15% of the sector. Shuhei Anan, Sri Lanka Telecom's chief executive, said the bonds could have a term of five to 10 years.

JAPANESE PM VISITS WAR SHRINE

Japanese Prime Minister Junichiro Koizumi has made a New Year visit to a controversial war shrine. The Yasukuni shrine honours 2.5 million of the country's dead in conflicts since 1853, including a number of war criminals.

ANGOLA WINS US TRADE PRIVILEGES

President Bush has brought Angola into the group of African countries which enjoy liberal trade terms with the US. The decision means Angolan goods can be exported to America under a lower tariff regime than they faced before. But, the US has dropped Eritrea and the Central African Republic from the list of countries enjoying these terms. A White House spokesman said The list reflects the degree to which countries are progressing toward a market-based economy and the rule of law.

US ARMY ENDS HALLIBURTON OIL DEAL

The US military says a special energy unit has taking over supervising oil imports to Iraq, ending a controversial Pentagon deal with Halliburton. The move comes after an official report saying a Halliburton subsidiary, which has close links to the White House, may have overcharged for fuel deliveries.

HOUSE PRICES DEFY SLUMP FORECASTS

House prices rose 1.5% in December, taking the average rise in house prices over the last year to more than 15%. The Nationwide's latest figures appear to have proven wrong those pundits who had predicted a sharp correction in prices during the past year. The North of England did best up by nearly a third on 2002 followed by Wales up by a quarter.

VODACOM'S $600M NIGERIAN PLEDGE

Vodacom, South Africa's leading mobile phone operator, has pledged to invest some $600m in Nigerian number two operator Econet Wireless Nigeria.

AUSTRALIA'S 'BEEF BOOST FROM BSE'

Australian beef exporters could benefit from the suspected BSE case in the US, an Australian government minister said. According to Agriculture Minister Warren Truss, the widespread bans gave producers a golden export opportunity. So far, more than two dozen countries have banned US beef markets where Australia and the US go head-to-head.

YUKOS SADDLED WITH $3BN TAX BILL

Embattled Russian oil giant Yukos owes $3.3bn in back taxes and fines, the Russian tax ministry says. The ministry accused the firm of evading taxes by setting up a web of affiliated firms. Yukos' largest shareholder and former boss, Mikhail Khodorkovsky, has himself been in jail on tax fraud charges since being arrested in October.

UK SHOPPERS GAIN SPENDING CONFIDENCE

UK consumer confidence improved in December after seeing a sharp fall the month before.Figures from research firm Martin Hamblin GfK showed consumer confidence rose to -5 this month. It followed a sharp fall to -6 in November, after the Bank of England raised rates for the first time in almost four years. The group said festive cheer and national rugby celebrations were behind the improvement.

GERMANS STAY AWAY FROM THE SHOPS

Germans are prolonging their caution about spending despite tax cuts and the Christmas season, new figures indicate. According to the German retailers' federation, HDE, Christmas sales were down 3-4% on the previous year. The bad news accompanies a survey of 2,000 consumers by market research firm GfK, which suggests shoppers are no more optimistic about 2004.

 

 

UK'S DEPRIVED AREAS OFFER PROFITS

The UK government is hoping to convince businesses and investors that some of the country's most run-down areas can help boost their profits. At a conference in London next month, companies will be invited to meet local authorities and community groups to see how they can best work together. Executives from firms including John Lewis and Cadbury, meanwhile, will visit some of the UK's worst hit spots. New York's Harlem neighbourhood has benefited from a similar programme.

CONSUMER DEBT WORRY HITS S KOREA

Growing concern over household debt and the country's troubled credit card industry is now impeding South Korea's economic recovery, official data shows. Industrial output dropped 0.3% in November despite strong exports, after the figure was hit by sharp falls in domestic spending and investment. The South Korean National Statistical Office (NSO) described the domestic economic situation as "lacklustre".