INTERNATIONAL

 

Mar 14 - 20, 2005

 

1.INTERNATIONAL

2. PAKISTAN

3. GULF

 

SINGAPORE TOPS TECH ECONOMY TABLE

Singapore has toppled the US from top spot in a ranking of world economies that make the best use of information and communication technology (ICT). The US has been outpaced by the advance of other nations, rather than any slow down in its own performance.
The annual World Economic Forum (WEF) index placed Singapore, Iceland, Finland and Denmark above the US, with the UK up three places in 12th spot. The WEF said ICT is playing a "central role" in growth and competitiveness.

 

 

Singapore was found to be the best performer in a number of categories, including quality of maths and science education, affordability of telephone connection charges and internet access, and government policy on ICT.

"It is clear that information and communications technologies will continue to play a growing role in boosting the efficiency of the increasing integrated global economy," said the report's co-editor Augusto Lopez-Claros.

He said that in turn enabled countries to "improve resource allocation and boost growth prospects".

The use of technology in 104 economies was assessed, while the report's Networked Readiness Index (NRI) measured the level to which countries exploit the opportunities.

Iceland was found to have achieved the greatest improvement among the top ten performers, moving up eight places to number two in the index.

Nordic governments, business communities and households are "enthusiastic users" of new technologies, the report noted.

The booming economies of China and India moved up 10 and six places respectively to into 41st and 39th in the index.

SURPRISE RISE IN UK FACTORY OUTPUT

UK manufacturing output recorded a surprise increase in January, official figures have shown, but the UK's trade deficit worsened unexpectedly.

The Office for National Statistics (ONS) said manufacturing output grew 0.2%, pushing the annual growth rate to 1.4%, its highest since June 2004.

But overall industrial production dipped 0.2% in January after energy suppliers were hit by the mild weather.

The goods trade gap widened to 5.2bn from a revised 4.9bn in December.

Lower exports caused the wider deficit. Analysts had expected the gap to narrow to 4.6bn.

The trade gap in goods and services widened to 3.7bn in January, up from a revised 3.5bn deficit in December.

The ONS said it expected production to see further improvements in industrial production in February, with output from energy suppliers set to bounce back as a result of the recent cold snap.

Output from utilities such as energy suppliers was hit by January's weather - which was the mildest for 15 years.

"Whilst manufacturing may have gone through a softer patch, these figures show it continues to remain in more robust health than is often portrayed," said Steve Radley, chief economist at employers' organisation EEF.

"However, with the prospect of even higher energy costs and problems for exporters from a stronger pound there is no room for complacency."

The British Chambers of Commerce (BCC) said the figures reinforced its assessment that "while the sector is not in recession, any recovery in manufacturing has persistently remained weak and inadequate".

AFRICA REPORT TO DEMAND NEW CASH

Tony Blair's Commission for Africa will urge wealthy nations to increase their aid to the continent by 30bn a year over the next decade.

African leaders needed to root out corruption and promote good governance, the commission's final report says. It urged that trade barriers against African producers be lifted and debts cancelled for the poorest states.

Blair set up the commission, which includes several African leaders and Bob Geldof, in February 2004. This major UK government initiative to deal with poverty in Africa, which the report calls "the greatest tragedy of our time", will show quite how far things have changed in recent years.

FORBES RICH LIST AT RECORD LEVELS

The Forbes magazine list of the world's super-rich has increased to a record 691 people with a combined fortune of $2.2 trillion (1.14 trillion).

Microsoft's boss Bill Gates is top of the billionaires' list for the 11th year in a row, ahead of Warren Buffett.

Meanwhile, India's Lakshmi Mittal and Ikea's Ingvar Kamprad have joined the top ten billionaires. Mittal, who is in the steel business, reached third position in the ranking and Kamprad is sixth.

Despite his continued ascendancy Gates nevertheless saw his net worth decline slightly to $46.5bn from $46.6bn

Mexico's telecommunication tycoon Carlos Slim has also entered in the top ten list of world's billionaires. Slim, who is the biggest shareholder in US MCI, has also an impressive increased of his fortune from $13.9bn to $23.9bn. Forbes said the highest riser was Mittal, whose fortune increased by $18.8bn to $25bn.

CHINA'S IMPORTS BOUNCE BACK

China's February crude oil imports rose from a 14-month low the month before, customs officials said.

The news helped restore confidence in growing demand from the world's second-biggest consumer.

China imported 18.17 million tonnes (2.25 million barrels per day) of crude in the first two months of this year, the officials said, down 12.7 per cent from a year ago.

The figure implied that imports in February alone rebounded to 10.37 million tonnes (2.7 million bpd), much higher than the meagre 7.8 million tonnes (1.84 million bpd) the previous month. Imports were down only 1.5 per cent from February 2004.

The import level was even more impressive considering last year's high base and the fact that Chinese New Year fell in February this year, a period in which all activities generally slow. In 2004, the Lunar New Year fell in January. China imported an average 2.45 million bpd last year.

BANGLADESH CLOTHING EXPORTS SLIDE

Bangladesh has seen its exports of woven clothing slump since the end of an international textile trade deal on 31 December, according to reports.

 

 

According to reports, exports of woven garments fell 21.34% in January from the previous year.

The 1974 Multi-Fibre Agreement (MFA) set up a quota system to govern the garment trade.

India and China are likely to benefit most from the end of the MFA by capitalising on economies of scale. The garment industry is a key part of Bangladesh's economy, with many workers in the cities using their wages to support families in rural areas. Textiles make up about 85% of Bangladesh's exports.

EU SPENDING PACT ROW RUMBLES ON

European Union (EU) finance ministers have failed to agree on how much they should change the EU stability pact, despite marathon talks in Brussels.

France and Germany have called for the pact to be modified after repeatedly breaking borrowing limits.

The two want some spending, such as the funding of long-term economic reform, to be excluded from the pact.

Smaller countries that have kept to the rules have opposed the move. Emergency talks will now take place on 20 March.

JAPAN HITS BACK AT OVERSEAS M&A

Japan's ruling Liberal Democratic Party (LDP) has thrown out plans to ease foreign takeovers of Japanese firms.

LDP Prime Minister Junichiro Koizumi has said he wants to double foreign investment in Japan. But his plan to let overseas firms buy Japanese ones by swapping shares, a common tactic elsewhere, touched nerves in a country unused to foreign buyouts.

In the wake of several messy takeover battles, the law change has now fallen foul of a key LDP committee.

Until now, foreign firms wanting to use shares rather than cash to buy into Japan have had to use their Japanese subsidiaries as a vehicle for the transaction. Koizumi's idea was to cut out the intermediate stage, hoping to boost Japan's laggardly pace of foreign inward investment amid a 42% rise in mergers and acquisitions during 2004.

CHINA PRIVATE AIRLINE AIRBORNE

China's first private airline has taken to the skies, ending the government monopoly on the rapidly growing civil aviation sector.

Okay Airlines made its maiden flight from Tianjin in north China to the central city of Changsha last Friday. The company has benefited from Beijing's decision last month to expand opportunities for the private sector, opening up previously closed sectors.

BOE OPTS TO LEAVE RATES AT 4.75%

The Bank of England has left interest rates unchanged at 4.75% for the seventh month in a row. Last month, the monetary policy committee (MPC) said a rate rise "might be warranted in due course" if the economy followed its forecasts. The decision to hold fire this month was widely expected, with a Reuters poll of 50 economists unanimous on the view that there would be no change.

JAPANESE FEARS DRIVE DOLLAR DOWN

The US dollar has fallen after Japan's prime minister hinted that the country could look elsewhere for its foreign currency reserves.

Junichiro Koizumi's comments weakened the dollar, pushing the euro up 0.5% to a two-month high of $1.3455.

The US's massive deficits are being propped up largely by Asian central banks buying dollars. Suggestions that South Korea might diversify away from the dollar prompted sharp falls on Wall Street.

Expectations are that the euro, which has been at historic highs, could pick up the slack if the dollar's attraction as the world's reserve currency weakens. Also last Thursday's exchange rate shake-up was triggered by testimony from Koizumi to a Japanese parliamentary committee.

NIGERIAN FOREIGN DEBT ROW EASES

Pressure on the Nigerian government to suspend foreign debt payments has eased after the country's Senate voted to honour debt obligations this year.

The House of Representatives earlier called for a halt to payments on Nigeria's $35bn (18bn) debt.

Nigeria has a cripplingly high debt despite making payments of more than $40bn since the late 1960s.

INTERCONTINENTAL SEALS HOTEL SALE

Intercontinental Hotels has agreed to sell 73 of its UK hotels for 1bn ($1.9bn) to consortium LRG Acquisition.

The world's largest hotelier said it would use the proceeds from the sale to return 1bn to shareholders. The announcement was made as the UK-based group reported a 27% rise in pre-tax profits to 309m for 2004.

CATHAY PACIFIC PROFITS GO HIGHER

Cathay Pacific, Hong Kong's biggest airline, reported profits of 4.42 billion HK dollars ($567m; 294m) for 2004 buoyed by a strong local economy.

The firm said an improved world economy also contributed to profits which were more than triple the 1.3bn Hong Kong dollars of Sars-hit 2003.

AIRBUS SALES HELP EADS FLY HIGHER

Increased sales of Airbus aircraft and healthy orders helped its parent company, EADS, significantly boost its profits and sales last year.

The aerospace firm said a strong performance from Airbus, which it majority owns, helped boost total sales by 5% to 31.8bn euros ($42.4bn;22bn). Total profits before tax, interest, goodwill amortization and exceptional items climbed 58% to 2.4bn euros.

TSUNAMI ERASES AIRLINE'S PROFIT

Sri Lankan Airlines has said high fuel costs and the drop in revenue following the Asian tsunami means it will report a loss of about $10m (5.2m).

CHINA SPENDS ON COALMINE SAFETY

China's Premier Wen Jiabao has promised the state is to spend 3bn yuan ($362m; 189m) to "truly make coal mining safe", state media reported.

The money will be used to improve safety equipment at state-run mines.

At least 6,000 miners died in China's mines last year, making them the deadliest in the world.

BUFFETT WARNS ON US TRADE DEFICIT

Billionaire US investor Warren Buffett has warned about the extent of the US trade deficit. He made the comments in his widely-read annual letter to shareholders of his Berkshire Hathaway holding company.

He warned that the US trade deficit, which totalled $672bn (484bn) last year, meant a knock-on over-reliance upon foreign investment into the US. Buffett said this foreign investment could become too dominant. "Other countries and their citizens now own a net of about $3,000bn of the US," he said.