PAGE PREVIOUS ISSUE

 

   

 
 
 
 
 
 
CURRENCY BUYING

SELLING

US Dollar 59.9 60
Bahrain Dinar 158 158.1
Canadian $ 50.85 50.95
Euro 70.75 70.85
Hong Kong $ 7.65 7.7
Japanese Yen 0.508 0.51
Kuwaiti Dinar 204 204.1
UK Pound 103.7 103.8
Last updated: Friday 23 Dec, 2005-12.30 P.M (PST)

MORE

 

3 DAYS FORECAST
In oC

CITIES MIN MAX

HUM%

FOR.

KARACHI
Today 12 26 38 Sunny
Tomorrow 11 27 38 Sunny
Day after 11 28 38 Sunny
LAHORE
Today 1 20 87 Sunny
Tomorrow 2 20 87 Sunny
Day after 2 21 87 Sunny
ISLAMABAD
Today 0 18 59 Sunny
Tomorrow 0 18 59 Sunny
Day after 0 21 59 Sunny
HUM%: Humidity In %
FOR.: Weather Forecast
updated: Fri - Sun 23-25 Dec, 2005

MORE

 
.

 

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

MORE

 
  DEPARTMENTS
 

IN THE NEWS
. INTERNATIONAL
. PAKISTAN
 

 

 

 

 
  INTERNATIONAL

Nov 21 - 27, 2005

CHINA'S INVESTMENT KEEPS GROWING

China's economy is still powering ahead, despite attempts to rein it in, a Chinese government report has said.

According to China's National Bureau of Statistics, investment in construction, factories and other fixed assets rose at an annual rate of 27.2% in October.

While that is slower than some analysts had predicted, it is almost double the rate China set out as its target.

Growth was driven by infrastructure projects such as railways, and by production of commodities such as coal.

The government has taken steps to cool the growth of investment spending, including trying to get banks to limit the amount of money they loan.

Their concern has been that too much money is flooding into sectors such as cement, steel and aluminium production, and may lead to overcapacity.

Instead they want fewer, but better targeted, construction projects and greater investment in areas such as coal extraction and power generation.

"Investment growth was a bit slower than we had expected, but growth remains strong in sectors such as coal and railways, where the government is trying to solve the problem of bottlenecks," said Mo Qian, an economist at Everbright Securities.

Ideally, the government would be able to offset a slowdown in investment spending with an increase in domestic consumption, analysts said.

According to the statistics office, fixed asset spending rose 27.6% in the first 10 months of 2005 to 5.58 trillion yuan (400bn; $689bn).

The fastest rate of growth was seen in the coal mining sector, where investment was up 76.3% from a year earlier.

Investment in power generation and other utilities gained 33%, while spending on the oil and gas industry climbed 31%, and railway expenditure rose 44%.

GERMAN GROWTH BOOSTED BY EXPORTS

Germany grew faster than expected in the past three months, official figures have shown, signalling a further recovery in Europe's largest economy.

GDP grew by 0.6% in Germany between July and September, an improvement on the previous quarter's 0.2% increase.

The rise was largely down to strong export growth, and the period also saw increased investment by businesses.

But economists remain divided over the strength of the recovery amid signs that consumer spending remains weak.

The economy grew 1.3% on a year-by-year basis over the period, according to figures published by the Federal Statistics Office. Experts had forecast a 1% rise.

The data confirms our expectations for a strengthening of the recovery Wolfgang Clement, Economy minister

On a quarterly basis, growth is now back to the same level seen at the start of the year following a surprise decline in the second quarter.

Overseas demand for German goods remained strong during the period, enabling firms to increase investment in their operations.

German ministers said this raised hopes of more jobs being created.

"Overall, the data confirms our expectations for a strengthening of the recovery," said outgoing economy minister Wolfgang Clement.

The new government has made improving Germany's economic competitiveness one of its main priorities.

Some economists believe the economy is heading in the right direction as greater wage restraint improves labour market conditions.

US TRADE DEFICIT WITH CHINA WIDENS

US Trade Representative Rob Portman said China's trade surplus with the United States was likely to exceed $200 billion this year, roughly $40 billion more than 2004. Portman, speaking at a China-US relations forum in Beijing, spoke of the growing US trade deficit as he warned bilateral trade tensions had not evaporated simply because of the textiles deal brokered last week.

"I believe it will be over $200 billion this year," Portman said.

The US trade deficit with China reached $146.3 billion in the first nine months of the year, according to US data.

The United States last year recorded a deficit with China of $162 billion,, powerful fuel for US politicians and industry groups who are increasingly worried about the imbalance in trade between the two nations.

For many in the United States, China is guilty of manipulating its currency rate to boost exports, of turning a blind eye to a rampant trade in fake goods, and of shutting out US firms from entering the country's huge domestic markets.

APEC SEEKS TRADE TALK FLEXIBILITY

Pacific Rim trade and foreign ministers have ended two days of meetings with a call for more flexibility to break an impasse in ongoing global trade talks.

Following their meeting in South Korea, they pulled short of blaming the European Union for the ongoing impasse in the World Trade Organisation talks.

But they want their own Asia Pacific Economic Cooperation (Apec) leaders to take the lead on the discussions.

George W Bush and the other 20 Apec heads meet in South Korea on Friday.

The issue of farm subsidies and import tariffs is currently holding back efforts to reach a new global free trade agreement, with most nations blaming the European Union (EU).

I'm confident that the European Union is not done negotiating [on global trade] because it's just too important Rob Portman, US trade representative

BLACK SEA PARTNERS TOAST GAS DEAL

A multi-billion-dollar pipeline carrying Russian gas under the Black Sea to Turkey is being officially opened in the Turkish port of Samsun.

It is the world's deepest undersea pipeline - in places, "Blue Stream" reaches a depth of more than two kilometres (1.5 miles).

The Turkish prime minister is hosting the Russian and Italian leaders.

The project has been plagued by disputes and the first gas flowed through the pipeline two years ago.

So this project may well set another record - as one of the most delayed opening ceremonies ever.

SAUDI WTO MEMBERSHIP APPROVED

The World Trade Organization (WTO) has approved Saudi Arabia's application for membership after 12 years of talks.

The world's largest oil exporter will become the 149th member of the WTO in 30 days' time.

The country will need to adopt the entire body of WTO legislation, a process that involves liberalisation of currently restricted sectors.

Saudi Arabia must open its long protected economy to the outside world, including fellow WTO member Israel.

GREENHOUSE GAS EMISSION 'TO RISE BY 52%'

Global greenhouse gas emissions will rise by 52% by 2030, unless the world takes action to reduce energy consumption, a study has warned.

The prediction comes from the latest annual World Energy Outlook report from the International Energy Agency (IEA).

It says that under current consumption trends, energy demand will also rise by more than 50% over the next 25 years.

The IEA adds that oil prices will "substantially" rise unless there is extra investment in oil facilities.

It says the world has seen "years of under-investment" in both oil production and the refinery sector.

The organisation estimates that the global oil industry now needs to invest $20.3 trillion (12 trillion) in fresh facilities by 2030, or else the wider global economy could suffer.

UN DEBUT FOR $100 LAPTOP FOR POOR

A prototype of a cheap and robust laptop for pupils has been welcomed as an "expression of global solidarity" by UN Secretary General Kofi Annan.

The green machine was showcased for the first time by MIT's Nicholas Negroponte at the UN net summit in Tunis. He plans to have millions of machines in production within a year.

COMMERZBANK TO BUY MORTGAGE FIRM

Commerzbank is to take control of German mortgage lender Eurohypo in a 4.5bn euro ($5.3bn; 3bn) deal.

The deal, which will see Commerzbank buy out its other shareholders Deutsche Bank and Allianz, will create Germany's second largest bank in the process.

STRONG SALES BOOST PORSCHE PROFIT

German luxury carmaker Porsche has seen its annual profits jump 8.9% boosted by ongoing strong sales across its range.

Reporting its initial results for the fiscal year to 31 July, 2005, its pre-tax profit increased to 1.24bn euros ($1.44bn; 844m).

UK STAFF TOP JOB INSECURITY TABLE

Workers in the UK have the lowest sense of job security out of employees in 18 of the world's leading economies, a bi-annual survey has found.

Some 24.2% of British workers think it is very probable or somewhat probable that they will lose their job over the next 12 months.

They are closely followed by 24% of Canadian staff and 23.8% of Americans, Right Management Consultants found.

BANK UPBEAT ON INFLATION TARGET

UK inflation is expected to meet its 2% target in the next two years, according to Bank of England predictions.

In its latest inflation report, the Bank said Britain's consumer price index (CPI) would remain above target in the mid-term before falling back.

Inflation fell last month to 2.3% for the first time since September 2004.

The Bank also dampened expectations of a cut in interest rates by maintaining its forecast for a pick-up in growth in the UK economy next year.

UK UNEMPLOYMENT RATE HOLDS STEADY

The number of people out of work fell by 1,000 between July and September to 1.43 million, official figures showed.

Britain's unemployment rate was 4.7% during the period, little changed from the previous quarter, the Office for National Statistics (ONS) reported.

But the number of people claiming unemployment benefit rose by 12,100 in October to 890,100, the ONS said.

EU THREATENS ACTION ON GAS PRICES

The European Commission has threatened to take action to free up the European wholesale markets for gas and electricity.

It said it had found a lack of competition and other serious problems.

The Commission blamed this mainly on the dominance of supplies by a few national gas and electricity companies.

Its investigation started this summer after UK energy companies complained they were being forced to buy wholesale gas at excessively high prices.

Gas and electricity prices continue to be concentrated, creating scope for operators to influence prices. Since the start of 2003 the wholesale price of gas has doubled.

US CONSUMER PRICE GROWTH SLOWS

US consumer prices grew at the slowest pace for four months during October, official figures show, signalling that inflationary pressures may be easing.

Prices grew by 0.2% in October, compared with 1.2% in the previous month, the Labor Department said.

The slowdown was mainly down to cheaper energy costs, which declined 0.2% in the month. In September, damage from hurricanes had pushed energy prices up.

Excluding food and energy costs, core inflation increased by 0.2%.

October's 0.2% drop in energy costs compares to the 12% increase in September.

So far this year, consumer prices have been rising at an annual rate of 4.9%, a significant jump from the 3.3% rise for all of 2004.

SUPPLY HOPES DRIVE OIL PRICE DOWN

Oil prices hit their lowest level for four months on Tuesday last on hopes that already healthy US fuel reserves will remain buoyant.

US light crude fell 71 cents to $56.98 a barrel - the lowest settlement since 20 July - while London Brent crude fell 68 cents to $54.05 a barrel.

Crude prices have dropped nearly 20% since hitting a record high of $71 a barrel in late August.

Stockpiles in the US have risen almost 13% on the year due to strong imports.

They are likely to have risen by another 1.8m in the last week. The US Energy Information Administration will release its inventory figures on Wednesday.

UK INFLATION DROPS BACK TO 2.3%

UK inflation has fallen for the first time since September 2004, Office for National Statistics (ONS) figures show.

Inflation measured by the Consumer Prices Index (CPI) dipped to 2.3% in October from 2.5% a month earlier.

The drop was slightly bigger than had been forecast by experts and could improve the prospects of a rate cut.

The underlying rate of retail price inflation fell to 2.4% from 2.5%, while the headline rate - which includes mortgages - fell to 2.5% from 2.7%. The fall in CPI inflation moves the figure closer to the government target of 2%.

CAR SALES WEIGH ON US RETAIL DATA

US retail sales fell 0.1% in October, dragged down by weak sales of new cars after the end of summer discounts.

Despite the fall, experts said the figures were better than expected and that the outlook for the crucial pre-Christmas period remained bright.

Excluding car sales, total retail sales increased by 0.9% last month.

Retailers including Wal-Mart, Costco and JC Penney all reported a healthy rise in sales as consumers shrugged off concerns about high fuel prices.

Wal-Mart, the world's largest retailer, saw a 4% rise in like-for-like sales in October as colder weather boosted clothes sales.

 
 

Pakistan & Gulf Economist 2005    Privacy Policy   |   Terms of Uses