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KARACHI         - 021 LAHORE          - 042 ISLAMABAD    - 051 FAISALABAD   - 041 MULTAN          - 061 PESHAWAR    - 0521 CANADA          - 1 KUWAIT           - 965 INDIA               - 91 IRAN                - 98 U.K                   - 44 U.A.E                - 971 U.S.A                - 1

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  DEPARTMENTS
 

IN THE NEWS
. INTERNATIONAL
. PAKISTAN
 

 

 

 

 
  INTERNATIONAL

Oct 31 - Nov 13, 2005

BIGGEST BANKS' EARNINGS RISE

The net earnings of the world's biggest banks rose by a third last year, due to large amounts of loans and a drop in the cost of risk, according to a Bank of France study.

"The strong growth context of the world economy, particularly a drop in business failures, was favourable to the activity of the large international banks in 2004," the bank said in an October statement.

Despite an overall 33 per cent profit hike in 2004, the study warned banks to be aware of growing risk in the current, less favourable, economic climate.

Switzerland posted a particularly high profit rise of 79.1 per cent, or 10.2 billion euros ($12.4 billion) in 2004.

Net profit rose in Italy by 45.3 per cent (6.6 billion euros), in France by 32 per cent (14.1 billion euros) and in Belgium, The Netherlands and Luxembourg (Benelux) by 30.1 per cent (17.3 billion euros).

Bouncing back from net losses in 2003, Germany had a net profit of 1.5bn euros and Japan had a net profit of 4.5 billion euros.

After dropping 1.6 per cent in 2003, the net earnings from banking activities of all the banks reached 669 billion euros in 2004, up 5.5 per cent.

The report said that last year there had been a drop in bad debt and a reduction in the global risk of loans, down by 35 per cent after a drop of 17pc in 2003.

European banks should maintain adequate funds and risk cover to take into account a possible rise in risk in coming months, partly due to high oil prices, the study warned.

Banks should show an "increased commercial aggressivity" towards businesses and individuals due to competitive pressure and low interest rates, it added.

The Bank of France carried out its 2004 study on the five main banking groups in Benelux, Britain, France, Germany, Italy, Japan, Spain, Switzerland and the United States.

CHINA SEEN IMPORTING MORE RICE

China, the world's largest rice consumer, is likely to import more rice than it exports in the coming years even though a bumper harvest this year will boost exports next year, industry officials said.

China's rice output this year will be 182 million tons, up from 179 million tons last year, Zhou Guanhua, a deputy director at the State Grain Administration, told a rice conference in Beijing.

"Imports should be higher than exports in the next few years," he said.

Because China's consumption was five times global rice trade, it had to rely on itself for supply, the officials told the conference. Significant imports were impossible.

"Chinese can afford to import some different qualities from the international market because incomes have improved," said Yang Hong, a rice manager at the China National Cereals, Oils and Foodstuffs Corporation (COFCO).

"The increase in imports is not because of the shortage of supply. It is because people like to try different varieties," said Yang.

But she said annual imports were unlikely to hit 2m or 3m tons in the coming years.

China has recently approved imports of basmati rice from Pakistan. The initial amount was 100 tons.

Pakistani traders had tried to teach Chinese to cook the rice differently so it would not taste the same as local rice, Mohammad Yasin, general manager of Midtrans Commodities International was quoted as saying.

China had opened its rice market to four countries so far, but not to India, another major rice exporter, he said.

China's rice imports jumped 196 per cent in 2004 to 761,674 tons, of which 96 per cent came from Thailand and rest from Vietnam.

China's rice exports are likely to recover to more than 1 million tons next year following years of decline, industry officials said.

'INDIAN ECONOMY TO GROW AT 7PC'

Prime Minister Manmohan Singh said that India's economy was poised to grow at seven per cent in the fiscal year ending March 2006, but that a slump in the farm sector was styming growth prospects.

"We grew at almost seven per cent last year and this year too, we expect growth to be in excess of seven per cent," Singh was quoted as saying.

"However, this is based on a growth in agriculture of less than two per cent," he said. "If we have to achieve our ambitions of growing at a rapid pace of over eight per cent per annum, we must aim at an agricultural growth rate of over four per cent per year.

"Unfortunately, this has not been so in the recent past with average agricultural growth rates of just 1.5 per cent in the past three years," Mr Singh said, urging agricultural scientists to find ways to improve output.

HIGH OIL PRICES EARN WINDFALL FOR PRODUCERS

The oil producing Gulf Arab states are reaping the benefits of higher oil revenues, with highest ever oil revenues in decades. Saudi Arabian economy, the largest and the dominant in the region, is now projected to grow by 6.8 per cent this year and 5.1 per cent in 2006, driven by surging oil revenues and increased government and private sector spending, Samba Financial Group said in its quarterly report.

Revising up a July forecast of 6.5 per cent real GDP growth this year, Samba said record oil prices in late August and a growth in state expenditure in the last three months had contributed to the higher estimates.

Kuwait is also heading for highest ever oil revenues for the current financial year.

As per the Samba report the Saudi revenues are expected to surge to SR551bn ($150bn), resulting in a record budget surplus of 208 billion riyals ($55.5) billion. The government spending was projected to reach a "moderately stimulative" SR343 billion, Samba predicted.

WTO RULES AGAINST EU BANANA TARIFF

The World Trade Organization on Thursday struck down a proposed European Union tariff on bananas, saying it was too high to allow fair competition from Latin American exporters.

In its decision, the global referee said the new duty Brussels was proposing in order to comply with a previous ruling would still skew the banana trade.

US DURABLE GOODS ORDERS FALL

Government reports suggested a possible cooling in the housing market and some economic slowdown due to high energy prices, but analysts said the economy remained robust enough to permit the Federal Reserve to keep raising borrowing costs.

The Commerce Department said sales of new homes rose more slowly than expected last month and house prices dropped, while new orders for durable goods fell sharply.

However, another report from the Labour Department showed a bigger-than-expected drop in first-time claims for jobless benefits last week. Claims had shot up in the wake of Hurricanes Katrina and Rita, but have come down in the past two weeks.

EU BUDGET DEAL DIFFICULT: BLAIR

The European Union faces a "tall order" in settling its budget dispute, Tony Blair has said.

Following an informal summit at Hampton Court, near London, he said countries were "in strong support" of plans to reduce regulations.

Leaders meet again in December, at the end of the UK's six-month EU presidency, to recommence formal discussions on a budget for 2007-13.

Talks collapsed in June amid rows over Britain's rebate and farm subsidies.

The European Parliament voted to increase the budget by about four billion euros (nearly $5bn; 3bn) next year - despite demands from member states that it should be cut.

BOOTS SEES INTERIM PROFITS SLIP

British health and beauty retailer Boots posted on Thursday a 9.6-per cent fall in pre-tax profits for the first six months of its financial year. Pre-tax profits at Boots stood at 163 million pounds for the six months to September 30, compared with 180m pounds for the same period one year earlier, the group said in a statement. That was just above analysts' consensus forecasts of between 140 and 160m pounds.

DUBAI GOLD IMPORTS SEEN RISING

Strong demand is seen boosting Dubai's gold imports to 525-540 tons by the end of 2005 despite the recent jump in prices, the Dubai Metals and Commodities Exchange's gold executive director said. Imports were 503.5 tons in 2004 while exports stood at 260.909 tons.

WORLD BANK FOR 75PC CUT IN FARM TARIFF

Developed countries must cut their highest farm tariffs by 75 per cent if the world's poorest nations are to benefit from a World Trade Organization attempt to liberalize agricultural trade, experts at the World Bank said on Wednesday.

WTO members are due to meet in Hong Kong in December to put together a deal that would lower global trade barriers in an attempt to lift millions out of poverty. But efforts to agree first on cutting rich nations' farm subsidies and duties have run into trouble.

"Unless you have a 75 per cent cut in the highest tariffs there would be very little outcome at all," Will Martin, lead economist of the World Bank development research group, told Reuters in an interview.

FIAT PROFITS

Fiat's struggling auto unit may see profits in 2006, Fiat Group Chairman Luca di Montezemolo said on Wednesday. Montezemolo also said in a television interview that orders for new Punto model, which is crucial for the carmaker's recovery, have come in at 35,000 in less than five weeks after its launch.

EDF, AEM WIN NEARLY FULL CONTROL OF EDISON

French power giant EDF and Milan's utility AEM with partners have won nearly full control of Italy's second-biggest power group Edison, the Italian stock exchange said.

EDF and AEM, backed by some smaller Italian peers and banks, earlier this year agreed to share control of Edison in a major deal, which ended a four-year dispute over energy markets between Rome and Paris.

CHINA TEXTILE EXPORTS GROW BY 20.5PC

China's textile and clothing exports have grown by more than one fifth since the controversial end of global quotas at the beginning of the year, the International Labour Organization said.

But although jobs were lost in some other textile producing nations following the change, ILO experts said the free rein given to the world's biggest textile producers had not produced as big a shock as originally feared.

MITTAL STEEL BUYS UKRAINE GIANT

With a bid of $4.8 billion, the world's top steel maker Mittal Steel won a re-run auction of Ukraine's Kryvorizhstal giant on Monday, in a sale the "orange revolution" government hopes will calm investor jitters and attract foreign investment.

MTN 'IN IRAN MOBILE NETWORK DEAL'

South Africa's MTN phone company says it is to take a 49% stake in the new Irancell mobile network in Iran.

MTN has also given a 300m euro ($358.4m ; 203m) payment guarantee towards a GSM licence, it said.

EXXON

US oil giant Exxon Mobil has posted a quarterly profit of $9.9bn (5.55bn), the largest in US corporate history, on the back of record oil and gas prices.

CHIRAC WARNING ON EU TRADE OFFERS

French President Jacques Chirac has warned European negotiators he will oppose any further moves on farming designed to keep trade talks alive.

It comes a day before the EU tries to revive talks by proposing a revised farm offer to other trading nations.

Earlier, European Commission President Jose Manuel Barroso told French paper Le Figaro Europe would make new concession on agricultural support. But Mr Chirac told EU leaders France is prepared to veto any such moves.

DRUG FIRM PROFITS BEAT FORECASTS

Drugs giants AstraZeneca and GlaxoSmithKline have unveiled forecast beating results, buoyed by strong demand for key drugs.

AstraZeneca said operating profits had surged 49% to $1.7bn (952m) in the three months to the end of September.

MARCONI IN 1.2BN ERICSSON DEAL

Telecoms equipment firm Marconi has agreed to sell the bulk of its assets and its name to Swedish firm Ericsson in a deal worth about 1.2bn ($2.1bn).

FRANCE IN NUCLEAR SELL-OFF U-TURN

The French government has cancelled plans to part-privatise nuclear power group Areva, claiming strategic and safety concerns for its U-turn.

The announcement by Prime Minister Dominique de Villepin comes as privatisation plans continue for other state firms.

He said ongoing state control of Areva would ensure the necessary assurances.

Shares in Areva were due to be issued next year, with the sale set to raise up to 3.6bn euros ($4.4bn; 2.4bn).

SONY PROFITS DOWN

Sony has seen its profits tumble in the second quarter. Net profit was 28.5bn yen ($247m; 138m) in the three months ending 30 September, down from 53.2bn last year.

 
 

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