EU SEEKS TO END BUDGET DEADLOCK
European leaders are gathering in
Brussels in an attempt to reach a deal on the EU's next seven-year budget.
Ahead of the summit, Britain's last
ditch proposals to break the deadlock on the issue were rejected by key EU
states, including France and Germany.
European Commission President Jose
Manuel Barroso added that the offer was "wholly inadequate" and
The offer included an increase in the
budget, more money to new member states but no new cuts to the UK's own rebate.
In theory, EU leaders have until March
to hammer out a deal, but planning for long-term projects could be hurt, the
BBC's Oana Lungescu in Brussels says.
Europe is already in crisis after the
rejection of its first constitution earlier this year, our correspondent says.
If its leaders fail to agree on the
budget now, they will find it hard to agree on almost everything else, she adds.
The new UK proposal would increase the
2007-13 budget by a total of 2.5bn euros (£1.7bn) compared with its first
proposal, issued a week ago.
It leaves untouched the earlier
proposal to cut the rebate by 8bn euro (£5bn) over seven years, increasing the
UK's net contribution to the budget.
Britain says it will offer no further
concessions unless France agrees to at least allow the possibility of serious
reform of agricultural policy in three years time.
The new proposal includes sweeteners
for a number of countries, but there is nothing for France, Germany or Italy.
French Foreign Minister Philippe
Douste-Blazy said on Wednesday that the offer "provides no basis for an
agreement acceptable to all".
US TRADE PLUNGES FURTHER INTO RED
The gap between US exports and imports
has surged unexpectedly, as the US economy has sucked in oil.
In October, the trade deficit was a
record $68.9bn (£38.9bn), up 4.4% from the month before, the Commerce
Although the price of oil fell during
October, the volume of oil imported soared 9.3%, with industrial goods also
entering the US at record levels.
Economists warned it could signal
Most had forecast the deficit would
shrink, to about $63bn.
The news comes as the US is embroiled,
with much of the rest of the world, in negotiations in Hong Kong over a new set
of global trade rules.
At the heart of the talks has been the
tension between developing countries, which want their richer neighbours to
slash massive agricultural tariffs and subsidies, and rich nations, which want
to lock in greater market access for their service sectors.
So far, the Hong Kong talks appear to
have shifted services talks onto the back burner.
The US managed a slim $5bn surplus in
services - dwarfed by the $73.9bn deficit on goods.
The most politically sensitive segment
of the deficit, however, is with China - of which Hong Kong is part.
The deficit grew 2.1% from September to
a record $20.5bn - up a fifth over the past 12 months.
Earlier this week, China announced its
own trade surplus was at $90.8bn for the first 11 months of 2005, three times
the level of the previous year.
KAZAKH-CHINA OIL PIPELINE OPENS
Kazakhstan and China have inaugurated a
1,000km-long (620-mile) oil pipeline to supply Kazakh oil to energy-hungry
It is the first major export pipeline
from the landlocked Central Asian republic which does not cross Russia.
It will eventually export oil to feed
China's booming economy from huge reserves around the Caspian Sea.
Kazakhstan wants to become one of the
world's top oil exporters in the next decade or two.
Kazakh President Nursultan Nazarbayev
pushed a ceremonial button to start filling the new pipeline with Kazakh crude,
marking a new stage in his country's emergence as an oil exporter.
Construction began last year on the
pipeline from Atasu in central Kazakhstan to Alashenkou on the Chinese border.
It should be fully operational by the
middle of next year, providing a new source of oil for China to develop its
western Xinjiang region.
RICH NATIONS CRITICISED ON TRADE
Developing countries have urged the US
and European Union (EU) to offer fresh concessions on agriculture to break a
logjam in the trade talks.
The G20 grouping of middle-sized
economies said the EU must set a date for ending its farm export subsidies.
Poorer countries have attacked new EU
tariffs on bananas while criticising the US's stance on cotton subsidies.
Squabbling between the US and EU over
support for farmers has dominated the talks in Hong Kong so far.
The US has urged the EU to go further
in cutting food import tariffs, but the EU has reiterated that farming is just
one factor in the negotiations.
Speaking on the third day of talks, EU
Trade Commissioner Peter Mandelson launched an attack on US subsidies for cotton
He accused US negotiators of
"using a general smokescreen to dodge a specific commitment" to curb
the annual $4bn in aid given to cotton farmers.
BUSH SEES IRAQ ECONOMY IMPROVING
US President George W Bush has said
"tangible progress" has been made in rebuilding Iraq's economy, but
this had "not always gone as well as we hoped".
In a speech aimed at winning US public
support ahead of the Iraqi general election next week, Mr Bush focused on the
rehabilitation of public services.
The cities of Najaf and Mosul had seen
improvement, he said, but poor security had hampered reconstruction efforts.
Mr Bush has come under growing pressure
from Democrats on the issue of Iraq.
Opinion polls give him the lowest
approval of his presidency and suggest waning public support for the Iraq
PUTIN RESISTS FOREIGN BANK MOVES
Vladimir Putin has insisted foreign
banks should not be allowed to open their own branches in Russia despite strong
opposition from the US.
The Russian president said foreign bank
branches should be "forbidden", partly because of fears over money
laundering and also the need to fight terrorism.
Russia's stance is at odds with global
trade rules at a time when it is trying to join the World Trade Organization.
The US has insisted Russia change its position if it wants to join the WTO.
AFRICAN TRIBE BUYS PLATINUM STAKE
South Africa's Bafokeng tribe is to buy
a significant stake in one of the world's largest mineral producers in a major
black empowerment deal.
The 800-year old tribe, which lives in
the North West Province, will control 9% of Implats after the 3.4bn rand ($540m;
The Bafokeng's homeland is rich in
platinum reserves, currently being developed under lease by Implats.
Under law, firms must give black South
Africans a stake in their businesses.
By 2016, mining firms must ensure that
26% of their domestic assets are owned by black interests.
The Bafokeng has held a small stake in
Implats since 1998 when the two resolved a long-standing dispute over the rights
to mine reserves on Bafokeng land near Rustenburg.
BOEING SECURES $10BN QANTAS DEAL
Boeing is to supply Australian airline
Qantas with 65 Dreamliner 787 passenger jets in a deal worth $10bn (£5.7bn).
Qantas said it had ordered 45
twin-aisled 787 planes from the US aircraft maker, with options to buy an
The airline's decision is a blow to
Boeing's arch European rival Airbus, which had been pushing Qantas to choose its
A350 passenger jet.
Qantas said it expected to take
delivery of its first 787 jet in 2008.
The Australian airline said it could
eventually buy up to 115 of the long-range aircraft.
G8 EVENT 'MADE £5M FOR SCOTLAND'
Scotland gained a net profit of £5m by
hosting the G8 summit, according to an report for the government.
The study was commissioned by the
Scottish Executive and carried out by SQW Economic Development consultants.
It calculated the cost to the executive
as £60m, while spending directly linked to the summit was worth £65m to the
However Scottish Nationalists argued
that pictures of police in riot gear had damaged Scotland's global image.
More than 350 people were arrested
during trouble related to the July summit, which was attended by world leaders
from the United States, Canada, Russia, France, Italy, Germany and Japan. The
total cost of the event was £90.9m, with £72m spent on policing.
GUS BUYS PRICEGRABBER
UK retail group GUS has bought US
online cost-comparison firm Pricegrabber.com for $485m (£274m).
The privately-owned Pricegrabber, set
up in 1999, allows users to check the cost of thousands of products ranging from
anoraks to laptops.
SLOW START FOR XBOX 360 IN JAPAN
Microsoft's next generation Xbox 360
has got off to a slow start in Japan.
According to a study by leading
Japanese game magazine Famitsu, less than half of the estimated 159,000 360
consoles in stores sold in the first weekend of sales.
VODAFONE BUYS TURKISH MOBILE FIRM
Vodafone is buying Turkey's second
biggest mobile telephone operator, Telsim, for $4.5bn (£2.5bn).
It outbid Kuwait's MTC to win the
auction for state-owned Telsim, which holds about 25% of the Turkish market with
9 million customers.
Vodafone will provide $1bn in extra
funding for Telsim, which is expected to make a loss in the short term.
The privatisation of Telsim will give
further impetus to Turkey's economic case for membership of the EU.
BRAZIL TO PAY OFF IMF DEBTS EARLY
Brazil has said it plans to pay off its
entire $15.5bn (£8.7bn) debt to the International Monetary Fund (IMF) by the
end of the month.
The move will clear the country's
obligations to the Washington-based lender two years ahead of schedule.
The Brazilian government said the early
repayment reflected the improving performance of the country's economy.
It marks an economic turnaround for
Brazil, which obtained IMF loans in 2002 to avoid defaulting on its debts.
Finance Minister Antonio Palocci said
Brazil would fund the early repayment of its IMF debt from its reserves, which
have swelled to $66.7bn from just $15bn two years ago.
Brazil had been expected to repay
$7.03bn to the IMF in 2006 and $8.43bn in 2007, the Finance Ministry said.
FRENCH ROAD SALE REAPS 15BN EUROS
France has raised 14.8bn euros
(£10bn), by selling its stakes in three motorway operators, more than had been
French, Spanish and Australian
companies won separate auctions to buy the state's stakes in the three firms.
The proceeds from the controversial
privatisation - criticised by opposition parties - will be used to bolster
France's public finances.
France is home to Europe's largest
motorway network, which stretches for 4,800 miles.
The government had been hoping to raise
between 11bn and 13bn euros from the sale.
UK INFLATION LEVEL FALLS TO 2.1%
UK inflation has fallen for the second
month in a row, to 2.1% in November from 2.3% the previous month, the Office for
National Statistics says.
Lower petrol prices and cheaper air
fares helped to push the rate down.
Although the Consumer Prices Index
(CPI) measure fell, it still remains above the Bank of England's 2% target.
The underlying rate of retail price
inflation fell to 2.3% from 2.4%, while the headline rate - which includes
mortgages - fell to 2.4% from 2.5%.
If inflation has peaked it could pave
the way for a cut in interest rates next year.
FED PUSHES US RATES UP TO 4.25%
The US Federal Reserve has raised
interest rates by a quarter-point to 4.25% but signalled that the current cycle
of hikes may be nearing its end.
Most analysts had forecast the rise -
the 13th consecutive increase - since the central bank wants to keep the lid on
In a statement the Fed said further
monetary tightening would be needed.
But it also moderated its previous
language, leading experts to suggest that rates may have nearly peaked.
RUSSIA THREATENS UKRAINE GAS CUT
Russia's gas giant, Gazprom, has
threatened to cut off gas supplies to Ukraine if a new contract is not in place
by the beginning of next year.
Ukraine receives heavily discounted gas
from Russia, offsetting the price against fees levied for transporting Russian
gas through its pipelines.
Gazprom says it will not compromise
over its demand that Ukraine pays what it says are appropriate market rates.
The company says a three-fold increase
is both overdue and justified.
Ukraine's economy is in a much better
condition than five years ago, when the current contract was signed.
UK POOR FALL TO LOWEST SINCE 1987
Fewer people are poor in the UK than at
any time since 1987, according to the Joseph Rowntree Foundation.
The charity's latest report on poverty
and social exclusion says 12 million people in 2005 are poor - two million below
the early 1990s peak.
The foundation examined 50 different
indicators of poverty and found that while 20 had improved in the past year,
only two had got worse. But the report highlights problems for disabled people,
30% of whom are poor.