Mr Sarkozy's performance will be a key component in the
government's struggle to rebound from a heavy defeat in regional elections
last month. He won considerable popularity at the interior ministry, where
he took a tough stance on law and order. He says he will bring the same
toughness to economic policy.
"There are a couple of key words," he told
his inauguration press conference.
"Everything will be done for economic growth and
jobs," he said, adding that he would demand a "culture of
Mr Sarkozy's predecessor, Francis Mer, also promised to
keep reforms moving quickly.
But his attempts to streamline the economy proved
dramatically unpopular with trade unions, and caused widespread labour
Mr Sarkozy's pledge to support growth and jobs implies
that he is likely to favour loosening the government's purse-strings. But
France's fiscal freedom is constrained by the eurozone's Stability and
Growth Pact, which limits the size of state budget deficits to 3% of gross
CHINESE TRADE REFORM 'IS FAILING'
China has ceased to make any progress on free trade and
remains unnecessarily bureaucratic, according to a US report.
In its annual report, the US Trade Representative
conceded that China had made great strides since joining the World Trade
Organisation (WTO) in 2001.
But deregulation has stopped and some Chinese officials
are actively seeking ways to block trade, the report says.
Last year, the US had a trade deficit of $124bn
(£67bn) with to China, an issue of mounting political importance. US
politicians say China has been competing unfairly on global markets, and
has effectively been destroying American jobs.
China presents obstacles to commerce in many direct and
indirect ways, the USTR charged. "In many sectors, import barriers,
opaque and inconsistently applied legal provisions and limitations on
foreign direct investment often combine to make it difficult for foreign
firms to operate in China," the report said.
The problem, the USTR said, was cultural: Chinese
bureaucrats cannot rid themselves of the habit of interfering in the
In practical terms, this has often meant sheltering
domestic firms from foreign competition, according to the report. US
lobbyists are also concerned that the Chinese yuan is pegged against the
dollar at a rate highly favourable to China's exporters.
The USTR said China had made serious progress on
reducing tariffs, the most obvious barrier to trade. But most of this
activity was concentrated in 2001-02, and current barriers are more
subtle, the report added.
INDIA RECORDS DOUBLE DIGIT GROWTH
The best monsoon rains in a decade have helped India
enjoy double digit economic growth.
The country's economy grew by 10.4% between October and
December 2003, aided by a 16.9% rise in agricultural output, thanks to the
India, Asia's third largest economy, saw manufacturing
increase by 7.4% during the same third quarter period.
India's economy has grown steadily over the past year,
a boost to the government in the election next month.
The Central Statistical Organisation's 10.4% Indian
growth figure for October to December — compared to the same quarter in
2002 — is higher than China's 9.9%.
Agriculture accounts for almost a quarter of India's
economy and employs more than 600 million people.
TURKISH ECONOMY BEATS FORECASTS
The Turkish economy grew more strongly than expected in
2003. Beating both official government targets and market forecasts,
Turkey's gross domestic product (GDP) increased by 5.8% last year.
The figure for the fourth quarter which included the
Istanbul bombings — was an even stronger increase of 6.1%.
Analysts believe the Turkish economy will continue to
grow and meet the government's 2004 target of 5%. The Turkish government
had been hoping for an increase of 5.2% last year, as the economy
recovered strongly from its 2001 recession and financial crisis that saw
its economy contract by some 10%. Turkey's ongoing economic upturn —
driven by manufacturing, construction and exports — comes as the
government is receiving huge loans from the international community in
return for a major commitment to restructure the state sector.
US PETROL PRICES HIT RECORD HIGHS
US petrol prices have reached all-time highs following
an explosion and fire at a refinery in Texas.
The blaze at the BP plant in Texas saw the price of
unleaded gasoline hit a record $1.7768 a gallon on the New York Mercantile
US petrol prices were already high because of a lack of
stocks and concern that Opec — meeting — will stick to plans to cut
production. The fire is not believed to have been caused by "any
outside influence". US unleaded gasoline's previous record high was
$1.7750 in May 2001.
DOLLAR FALLS TO FOUR-YEAR YEN LOW
The US dollar has fallen to its lowest level against
the yen in four years. After increased optimism in Japan at the turn of
the financial year, the yen rose as far as 104.52 per dollar, its highest
level since June 2000. The yen then fell back slightly on speculation that
the Bank of Japan had intervened and sold off some of its stocks. But not
before a number of exporters fell on Japan's Nikkei index. Last week in
Tokyo it was down 64.38 points or 0.55% to 11,629.3. The Nikkei did
however eventually recover to end up 0.19% or 21.71 points to 11.715.39.
BUSINESS SLAMS EU POLLUTION LAW
Business groups have claimed new European Union laws
forcing polluting firms to pay clean-up costs will expose them to
The law holds polluters liable for damage caused to
wildlife, natural habitats, and water resources.
European employers' lobby UNICE says the difficulty of
estimating clean-up costs accurately could lead to offenders being
REUTERS REPORTS MARKET SHARE SLIP
Business news and information provider Reuters has
revealed it lost further market share last year.
The UK firm said its revenue share of the £6bn ($11bn)
global financial information market had fallen two percentage points to
37% in 2003.
However, Reuters said it remained confident of winning
back business with new products.
EAST-WEST MIGRATION 'IS A BOON'
Rich West European countries can only benefit by
throwing open their borders to skilled immigrants, new economic research
Economists Helena Marques and Hugh Metcalf have
calculated the impact of east-west migration after EU expansion.
In a paper presented at Royal Economic Society meeting
last week, they argue that Western wages and output will increase, not
fall as many fear.
But Europe's poorer South stands to be the main loser,
EURO INTEREST RATE LEFT UNCHANGED
The interest rate for the 12-state eurozone has been
kept on hold at 2% despite calls for reduced rates to help kick-start
The European Central Bank (ECB) revealed its decision
following a governing council meeting on April 1. Economists had expected
the ECB to keep rates frozen this month but are expecting a cut later this
year. There had been calls from some in the German business community to
lower rates now in order to stimulate growth.
SHAKE-UP IN DOW JONES MEMBERSHIP
The US's premier share index, the Dow Jones Industrial
Average, has changed its composition for the first time in five years.
American International, Pfizer and Verizon have been
added to the index, replacing AT&T, Eastman Kodak and International
The Dow Jones — which has been running since 1896 —
tracks the share movements of 30 companies. Changes to the widely-watched
index reflect trends within the US economy.
Pfizer is the world's biggest drugs company, American
International is the world's largest insurer and Verizon Communications
— formed by the merger of GTE and Bell Atlantic is one of the world's
leading providers of landline and wireless communications.
BRITISH BUSINESS BATTERED BY SPAM
The rising tide of spam messages is starting to
seriously inconvenience British businesses, a survey has found. It showed
that almost 20% of companies reported that more than half of all the
e-mail messages they received were unwanted junk e-mail.
Despite the growing problem, only a fifth of firms were
taking active steps to filter the junk, said the report. The UK government
survey is conducted every two years to see what UK firms regard as
computer security threats.
Most people with an e-mail address are familiar with
spam messages that offer all kinds of herbal cures, impotence drugs and
other dodgy goods via e-mail.
DONORS FOCUS ON AFGHAN SECURITY
Urgent measures to improve security in Afghanistan are
set to dominate the second day of an international donors' conference in
Donors have already pledged $8.2bn (£4.4bn) in aid
over the next three years.
But a BBC correspondent in Berlin says the issue of
security is casting a huge shadow over the conference.
The rising power of the drug warlords is a particular
concern — Afghanistan says it will boost co-operation with neighbours to
fight drug trafficking.
President Hamid Karzai told delegates that drugs were
undermining the "very existence" of his country.
JAPANESE RUSH TO BUY 3G MOBILES
Japanese mobile telephone company NTT DoCoMo has said
more than three million people have signed up for its third-generation
More than one million users switched to the option in
the past month.
DoCoMo launched the world's first 3G service in 2001,
enabling callers to see each other and send video footage via their
Its success is being watched closely in Europe where
there has been huge investment in 3G services.
OPTIMISM AT 7-YEAR HIGH IN JAPAN
Business confidence in Japan is at its highest level
for seven years, the Japanese central bank's latest quarterly survey has
found. The Tankan survey revealed improved optimism in all major sectors
of the Japanese economy. Business confidence among big manufacturers was
at its strongest level since June 1997. The turnaround in the service
sector was even more dramatic, showing the best mood since May 1992.
Japanese businesses have been nervous about the yen's
strength against the weakened dollar, but the Tankan survey suggests such
fears are receding.
Japan's service sector has languished in the doldrums
for years as consumers have stubbornly ignored government efforts to
persuade people to spend more money to boost Japan's listless economy.
UK COMPANIES ON ROAD TO RECOVERY
Further evidence that UK private companies have turned
the corner has emerged.
Profitability is steadily increasing, with another
period of growth since the turning point in late 2001.
Office of National Statistics figures show the net rate
of return of private non-financial corporations was 12.8% in the fourth
quarter of 2003.
The average profitability for 2003 was 12.3% compared
with 11.4% in the previous year, according to the ONS.
UK'S EXPORT HOPE IN TRADE-BALANCE FALL
Britain's current trade deficit with the rest of the
world reached £18.8bn in 2003, up from £17.8bn in 2002. The Office for
National Statistics (ONS) said the quarterly deficit narrowed to £5.2bn,
down from £6.3bn. And exports of goods rose for the first time in the
year, and the yearly gap in manufactures declined slightly.
Separate figures from the ONS showed that the economy
had grown by 2.2% in 2003, compared with an earlier figure of 2.3%.