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Political inefficiency has contributed largely to Dhaka’s debacle at the World Trade Organisation ministerial conference in Hong Kong, dashing the country’s hope of gaining meaningful market access, says a local research organisation.
   The December 13-18 Hong Kong ministerial agreed on a deal to allow zero tariff market access for at least 97 per cent of the product lines of the developing and least developed counties to rich nations.
   Bangladesh’s key export items, readymade garments, have the prospect to fall in the rest three per cent goods, which will be dropped out of the duty-free entry list.
    ‘The technical preparation of Bangladesh has been good as far as the first WTO draft, worked out in Geneva, is concerned,’ said Debapriya Bhattacharya, executive director of the Centre for Policy Dialogue.
   ‘But ministerial conference is meant for political negotiation and decision making that depend entirely on political leadership,’ he said at a press briefing in Dhaka, analysing the outcomes of the WTO talks.
    The economist also said that official negotiators failed to make use of the country’s political connections and mobilise political clout to withstand pressures mounted in Hong Kong on Bangladesh by WTO heavyweights.
   ‘We don’t know whether top most persons in Dhaka were engaged in the process during the crucial time of negotiation in Hong Kong,’ he added.
   Debapriya said there was a self-deceptive attitude on the part of Bangladesh that duty-free and quota-free access would be achieved in the conference.
   ‘Bangladesh also failed to understand the depth of the resistance built by the USA,’ he added.
   ‘The campaign for US TRADE Bill also generated a sense of false optimism and fundamentals of the US textile were not understood,’ he felt.
   The economist said that Bangladesh also did not adequately anticipate that certain developing countries like Pakistan and to some extent Sri Lanka would take stand against Bangladesh’s demand for free market access for textile.
   The situation aggravated further when a separate group (G14+1) was set up under Bangladesh’s initiative at later stage without any proper understanding.
   He, however, said that still there is a ray of hope as doors of further negotiation are open, though it is very unlikely that Bangladesh as well as other LDCs would be able to drop major items from the exclusion list.
   ‘Nevertheless, export diversification should have always been a top priority and Bangladesh needs to revisit its export promotion strategies,’ he suggested.
   Debapriya also said that the country now needs to put more emphasis on acquiring competitiveness through gaining efficiency in the areas of trade supportive infrastructure as well as overall economic governance.
   He also said that Bangladesh will have to enhance its negotiation capacity and explore the potentials under the trade related investment measure (TRIMs) as transition period extends up to 2013.
   Research director of the CPD, Mustafizur Rahman, said that the outcome of the ministerial is applicable for all the LDCs that jointly negotiated in the meeting.
   He also said that the situation is not like that Bangladesh’s textile export would decline abruptly, rather it may see ‘status quo’ as garments exporters will continue with existing level of tariffs imposed by the USA.
   Among others, senior research fellows of the centre, Uttam Kumar Deb and Fahmida Khatun were also present at the press briefing.
    The CPD took a delegation led by the executive director to the Hong Kong meet, while the research director was included in the government delegation as a representative from the civil society movement.

The finance and planning minister, M Saifur Rahman, Wednesday termed the exclusion of Bangladesh’s textiles from duty-free and quota-free market access in the WTO draft deal as a success.
   ‘This is not a disappointment,’ said Saifur.
   He said Bangladesh’s entrepreneurs are already highly competitive, and that is why the developed countries and the developing countries, including India, Pakistan and Sri Lanka, opposed duty-free and quota-free market access of the country’s textile products.
   Saifur made the observations while addressing an award giving ceremony on ‘Best published accounts and reports’ organised by the Institute of Chartered Accountants of Bangladesh, with its president Sheikh A Hafiz in the chair.
   The minister said Bangladesh has achieved tremendous success in terms of building entrepreneurship and investment climate.
   ‘Neither we are an indebted country nor a basket case,’ Saifur added.
   He said the development partners appreciate Bangladesh for achieving tremendous successes in various sectors despite continuous turmoil in the country’s polity.
   Saifur also criticised the media for focusing negative issues only and urged to uphold the country’s interests first.
   This year the ICAB awarded Prime Bank as the best organisation in banking sector, Industrial Development Leasing Company of Bangladesh in non-banking sector, BOC Bangladesh Limited for manufacturing and BRAC as micro-finance institute.

While Bangladesh’s delegation is under fire for its failure to safeguard the country’s trade interests at the WTO talks, Pakistan’s team is hailed at home for its success in limiting LDCs’ duty-free market access.
   Most of the apparel producers have hailed the negotiators efforts headed by the commerce minister Humayun Akhtar Khan for striking a deal which could give some protection to their market against the LDCs who enjoy duty and quota free access, the Dawn newspaper reports.
   The chairman Pakistan Hosiery Manufacturers’ Association, Javed Bilwani, hoped that the achievement would enable troubled apparel exporters to get their due share in the US market.
   Bilal Mulla, chairman Pakistan Readymade Garments Manufacturers and Exporters Association (Prgmea), said that by containing LDCs exports up to 97 per cent of their products line would widen their market access to US.
   The Dawn report saw it a success for Pakistan to restrict market access of least developed countries at 97 per cent of products under annexure F of the final WTO’s declaration.
   The annexure F tabled by Pakistan withhold the balance of three per cent of products originating from LDCs from getting quota and duty-free access to US market.
   This would mean that US could use this space of three per cent for political pressure on LDCs including Bangladesh, Cambodia and Vietnam as their apparel exports to US have grown manifold soon after the quota-free regime started from January 1, 2005.

National Board of Revenue is likely to launch a fresh drive against the existing TIN-takers to boost the revenue collection from income tax sector.
   According to NBR sources, the lifestyle, wealth and other related matters of the TIN-takers would be strictly monitored by the NBR to collect more income tax.
   The NBR took the decision following a directive of the finance minister, M Saifur Rahman, to boost income tax by up to 25 per cent.
   Buoyed by what he sees as a steady expansion of economic activities in the country, Saifur Rahman on December 14 projected an income-tax growth touching 25 per cent this fiscal year if his directives were followed. AS Jahir Muhammad, member (income tax policy), said they are now looking forward to collect the income tax return as early as possible.
   ‘We will strictly monitor the lifestyle of the TIN-takers and their assessment which they had submitted to the NBR for giving income tax,’ he said.
   ‘If we see any difference between the income tax return and the lifestyle of the TIN-takers, we will ask him to do a fresh assessment with correct information,’ the NBR member said adding that their focus would now be more on doctors, engineers, corporate officials and the likes.
   ‘We’ve already given strict instructions to the field level tax officials and hope to see the good results within a short time,’ he said.
   The NBR through its Central Intelligence Cell (CIC) recently launched drives against some ‘big-shots’, including BGMEA leaders, and achieved a good success.
   The total growth of the income tax was 21 per cent in the first five months (July-November) of this fiscal year, as targeted earlier.
   The Finance and Planning Minister in his Dec. 14 meeting with tax officials emphasised on collection of tax from the existing TIN-holders, rather than increasing the number.
   ‘There are now so many TIN-holders in the country; the question is if all of them pay tax regularly or correctly?’ he told the reporters after the meeting. The directives to the income-tax officials came in the first meeting with them after the national budget, held at the NEC conference room.
   The finance minister also directed the NBR to submit a report within December explaining why some TIN-holders did not submit returns.

The government has formulated a three-year work plan on spice cultivation in the country to increase production of spices, which proved all too spicy for short supply.
   ‘An additional 1 lakh tonnes of spices will be produced annually if the Tk 30 crore-programme is implemented,’ said Agriculture Minister MK Anwar at a meeting Wednesday.
   At present, there are some 12 lakh tonnes of spices, including onions, garlic, ginger, turmeric and chili, produced in the country annually, the meeting was told.
   Onion constitutes half the total spice output.
   By that official account, the country has a shortage of 9 lakh tonnes of spices against its total demand for 21 lakh tonnes.
   Referring to the aims and objectives of the work plan, Dr Jahangir Alam, member of Bangladesh Agriculture Research Council, informed that spices are cultivated on 3.46 lakh hectares of land. Of those, the main five spices are cultivated on 3.16 lakh hectares.
   He also said a total of Tk 756 crore was spent on spice import in the last fiscal. Foreign currency worth Tk 400 crore could be saved and the objective of crop diversification achieved if the programme is implemented.
   The agriculture minister advised all to formulate a proposal providing elaborate information, including the economic aspects of the work plan, production scenario, land usage and crop diversification.
   He said a scheme is being implemented in the country to increase the production of spices. Some 5.89 lakh tonnes of onions were harvested last fiscal against 1.53 lakh during 2002-03.

The Chinese ambassador, Chai Xi, has expressed his optimism that the existing trade gap of his country with Bangladesh would be reduced as Beijing has taken measures to increase its imports from Dhaka.
   ‘Our government has been providing subsidies and other incentives to the Chinese entrepreneurs to import more goods from Bangladesh,’ Xi said as he talked with senior journalists of BSS during a courtesy visit to the central office of the news agency in Dhaka Wednesday morning.
   The ambassador said last year, trade gap with Bangladesh over $1.9 billion in favour of China. China has increased its export from Bangladesh by about 40 per cent to reduce the gap, he pointed out.
   The envoy said Bangladesh has tremendous economic potentialities for which foreign direct investments are essential. He said the country must ensure congenial atmospheres and sound conditions to attract FDI.
   In response to a query on sending of more trade delegations and entrepreneurs from China to Bangladesh, the ambassador said unless you have political stability in the country, Bangladesh can not expect desired foreign investment.
   The Chinese diplomat stressed the need for removing all bottlenecks and making the process of decision making quicker to attain its cherished goal to attract FDI.

The code of conduct for the country’s’ shipping agents and freight forwarding services will be discussed at the inter-ministerial meeting on Thursday, the source said.
   The officials of finance, shipping, commerce ministries and the National Board of Revenue will sit together Thursday, to discuss the code of conduct of shipping agents and freight forwarding services.
   The meeting is intended to stop the alleged money laundering.
   There are allegations that the freight forwarders are not carrying on their business properly, as they have no license.
   Moreover, the government has not given them license too.
   The National Board of Revenue, sources said, decided to issue licence in 2000, but it was not implemented.
   The representatives of International Freight Forwarders Association, Association of Cargo Agents of Bangladesh and International Container Shipping Association demanded implementation of the forward licensing rules as per SRO No 289/2001 at a meeting Tuesday.
   The representatives of these associations expressed their strong resentment over some malicious reports published recently in certain daily newspapers, apparently to undermine their services.
   They said if the harassment continued and issues of bill of lading and the implementation of the existing Freight Forwarders’ Licensing Rules were not fast tracked, shipping and logistics service providers might be in the immediate future compelled to consider definitive measures in defence of their integrity.
   The Federation of Bangladesh Chambers of Commerce and Industry, Dhaka Chambers of Commerce and Industry, Bangladesh Garment Manufactures and Exports Association, Metropolitan Chamber of Commerce and Industry in separate applications to the NBR recently urged the authorities to set a new code of conduct for the agents.

A big portion of the tea offered in this week’s tea auction was withdrawn due to lacklustre response, trading sources said.
   The auction held in Chittagong Tuesday witnessed substantial withdrawal following much less demand from the major market players of home and abroad.
   According to the market sources, there was much less demand particularly during the second half of the sale. Internal loose tea buyers were much less active, but there was a fair interest from the blenders/ packeteers.
   However there was some buying on account of Pakistan, but Afghanistan continued to be absent. CIS countries also bought few teas. There were quite heavy withdrawals in this auction particularly in the medium and plainer broken categories.

A four-day International Plastic Fair-2005 begins today at Bangladesh-China Friendship Conference Centre in the city aiming at boosting export of Bangladeshi plastic goods.
   The finance and planning minister, M Saifur Rahman, will inaugurate the fair as chief guest while the commerce minister, Altaf Hossain Choudhury and the commerce adviser, Barkat Ullah Bulu, will be the special guests.
   Bangladesh Plastic Goods Manufacturers and Exporters Association is organising the fair, which will have 53 stalls where some 36 exhibitors from home and abroad, including India, Singapore and Taiwan, will display their products.
   Of the total stalls, 47 will display finished products of the local companies while four stalls will display foreign machinery and two others will exhibit raw materials.
   The country fetched Tk 865 crore in foreign exchange in the last fiscal year through direct and indirect export of plastic products.
   The fair will remain open to visitors from 10am-8pm everyday till Sunday.
   On the sidelines of the fair, a seminar on plastic waste recycling in Dhaka will be held on Saturday, the third day of the fair.

MA Momen has been elected as the president of the Dhaka Chamber of Commerce and Industry for the year 2006.
   Hossain Khaled and Hossain A Sikder were elected respectively as the senior vice president and vice president of the Chamber for the same period.
   The election was held on December 15, said a press release.
   Eleven newly elected directors are: Safina Rahman, Sayed Habibur Rahman, Haider Ahmed Khan, Sharfuddin, M Salem Sulaiman, Asif Ibrahim, MS Shekil Chowdhury, Shafique Hossain and Arshad Ali from trade group. The elected president, senior vice president, vice president and other directors will take their charges on December 29.

MKM Mohiuddin has been elected president of the Chittagong Stock Exchange for the year 2006, said a press release.
   Prior to his new assignment, Mohiuddin, served as the vice-president of CSE since 2004.
   The CSE board of directors has also elected Nasiruddin Ahmed Chowdhury, as the first vice-president.
   He has been serving as the vice-president of CSE since 2004.

Sharif Mohammed Akhtar Hossain, a navigation engineer of Bangladesh origin, has been appointed as general director of Burren Resources Petroleum Limited in Turkmenistan. Earlier he was regional manager of Volga Caspian Transportation and Trading, a company of the Burren petroleum.
   A Dhaka University science graduate, Sharif had his navigation engineering course in Odessa Marine School and post graduation from UK University of Wales.
   He has a long experience in oil operation and transportation in the Black Sea.

Sri Lanka harvested 291.4 million kg of tea in the first 11 months of 2005, up 3.5 per cent on the same period last year, the Tea Board said Tuesday, adding they were still on course for a record 320 million kg crop.
   But the amount of tea harvested in November fell 3.4 per cent on the same period last year to 26.4 million kg, the Sri Lanka Tea Board said in a statement.
   ‘It is difficult to give a specific reason,’ a Tea Board statistician told the news agency. ‘It may be something to do with the rain, which slows down the picking. There certainly isn’t any crop damage.’
   Sri Lanka is the world’s fourth largest producer after China, India and Kenya. Tea earns some 13 per cent of the island’s export income. The country’s previous record output was 310 million kg in 2002.
   Russia, which consumes some 20 per cent of Sri Lanka’s 290 million kg a year exports, is the biggest single consumer of Ceylon tea, which has lost market share in recent years as drinkers switch to teas that taste better when brewed from teabags.

Rahimafrooz Group has launched the marketing of Castrol lubricants in the country.
   Mahmudur Rahman, adviser of the energy ministry, inaugurated the marketing of Castrol lube oil at a function at a city hotel Tuesday evening.
   Addressing the function, the energy adviser said the launching of world-class Castrol lubricant in local market has reflected the sign of the country’s growing economy.
   Castrol, a brand lube oil of British Petroleum, has been marketed across the country under a partnership with state-owned Jamuna Oil Company.
   Omer Mustafa Dormen, lubricants director of Castrol Middle East, also spoke at the function, presided over by the Rahimafrooz Group chairman, Afroz Rahim.

AMCL-PRAN declared 26 per cent dividend, the highest since the company’s inception, to its shareholders for the year 2004-2005.
   The decision came Wednesday from the 20th annual general meeting of Agriculture Marketing Co Ltd, the producer of Pran brand food and drinks.
   The pre-tax profit of the company was Tk 4.25 crore in 2004-2005 while the total export figure was Tk 2.05 crore.

Six of the world’s poorest countries face the prospect of being left out of a much-hyped Group of Eight debt forgiveness plan when the International Monetary Fund board meets on Wednesday to implement the deal.
   In an IMF memo to board members said Tuesday the global lender’s staff recommended the debts of Ethiopia, Madagascar, Mauritania, Nicaragua, Rwanda and Senegal not be written off until they take steps to fix macroeconomic and government spending management problems.
   The memo said these six countries ‘will qualify for (Multilateral Debt Relief Initiative) relief when the board determines that the identified remedial actions have been taken, and that a satisfactory performance has been maintained with respect to the other qualification criteria.’
   The IMF board is expected to make a statement on the issue after its Wednesday meeting.
   The Group of Eight club of rich nations—the United States, Britain, France, Germany, Italy, Canada, Japan and Russia — agreed in July to cancel the debts some of the globe’s most impoverished nations owe to the World Bank, IMF and African Development Bank.
   Development activists and lawmakers on Capitol Hill said narrowing the deal’s scope would violate the spirit of the accord ratified by IMF and World Bank member states at the global lenders’ annual meetings in Washington in September.
   Rock star Bono, of U2 fame, was this week named Time Magazine’s ‘Person of the Year,’ along with philanthropists Bill and Melinda Gates, for pushing world leaders into a debt relief deal through lobbying and a series of ‘Live 8’ concerts held just before the Scotland summit.
   In the Dec. 8 memo, staff at the global lender recommended that 14 countries—Benin, Bolivia, Burkina Faso, Cambodia, Ghana, Guyana, Honduras, Mali, Mozambique, Niger, Tajikistan, Tanzania, Uganda and Zambia—all qualify to have their debts wiped out immediately by the fund. For the other six countries in the original G8 deal, there are stumbling blocks, the memo said.
   It noted there is no IMF programme in place in Ethiopia and said macroeconomic pressures are emerging there—particularly in the balance of payments—that need redress.
   In Madagascar, the fund said the country needed to show ‘evidence that fourth-quarter tax revenue performance is in line with staff projections and an agreement has been reached on a 2006 budget that is consistent with the authorities’ macroeconomic objectives.’
   IMF staff said Nicaragua’s implementation of a fund-supported programme ‘has not been satisfactory until recently’ and urged the board to delay debt relief until after the fund’s next review.
   It said policy slippages had occurred in Rwanda since the last review of that country’s IMF programme, in August 2005, and said another review is needed before debt relief is granted.
   Mauritania was cited for having no fund deal and for a ‘substantial deterioration’ in budget formulation, execution, reporting and public expenditure tracking.
   It urged debt forgiveness in Senegal be suspended until the country deals with weakening procurement practices and large extra-budgetary operations related to a new airport in Dakar.
   Development activists, including the aid group Oxfam, have decried the IMF’s potential narrowing of the G8 deal and some US lawmakers have written to IMF Managing Director Rodrigo Rato urging full debt cancellation ‘without further delays or conditions.’

Indonesia aims to restructure portions of around $135 billion in debt owed to foreign and domestic creditors to ease the government’s fiscal burden and boost the economy, a minister said Wednesday.
   The planning minister, Paskah Suzetta, told the news agency in an interview that Indonesia needs not just debt rescheduling but debt hair cuts, and needs not just rescheduling of some bilateral debt but also of debt owed multilateral agencies like the World Bank.
   The move comes after Japan, Indonesia’s largest bilateral creditor, warned it will raise interest rates and tighten the terms and conditions on some loans to Indonesia, Suzetta said.
   ‘Frankly, I will tell them that we have just recovered from an illness, so we should not be given tougher conditions. The government, through the finance minister, has asked me to negotiate,’ Suzetta said. The Paris Club of official creditors earlier this year agreed to freeze debt payments of countries hit by the devastating December 26 Indian Ocean tsunami, including Indonesia, until the end of 2005 and allow the deferred payments to be repaid over five years, with a one-year grace period.
   Suzetta declined to give detailed figures or a timeframe. He had told reporters Tuesday that the government was considering seeking approval from the Paris Club to reschedule portions of debt owed official creditors in the group to ease servicing costs.
   Suzetta was appointed early this month in a reshuffle of the economic team. He was a long-time legislator in charge of budget issues and a senior member of the Golkar Party, which has the largest number of seats in parliament.
   Central bank data showed Indonesian government foreign debt included some $48 billion to the Paris Club, $19 billion to multilateral agencies and $9.7 billion to the International Monetary Fund as of June last year.

Brazil’s economy needs to grow at a much higher rate to successfully combat the extreme poverty in which millions of its people live, the World Bank president, Paul Wolfowitz, said Tuesday.
   ‘I think Brazil can and could do better and I think that’s essential for fighting poverty,’ Wolfowitz said at a news conference in the country’s financial capital, Sao Paulo.
   Wolfowitz, visiting Latin America’s largest country for the first time since he was elected World Bank president in March, said Brazil had made progress but a lot needed to be done.
   Extreme income inequalities meant that the benefits of economic growth had not done as much to reduce poverty in Brazil as it had in other countries, he said.
   ‘Real poverty reduction is going to require growth rates higher than Brazil has been achieving,’ he said.
   Around a third of Brazil’s 186 million population is estimated to live below the poverty line.
   President Luiz Inacio Lula da Silva’s government has pledged to wipe out poverty but is following tight fiscal policies to get the economy on a sound footing rather than throw public money at the problem.

The European Commission unveiled on Wednesday plans to strengthen the market for environmentally friendly vehicles in an effort to help cut back pollution caused by the transport sector.
   The rules envisaged would oblige public authorities in cities and towns to have at least one quarter of their fleets made up of low or no pollution vehicles, including buses, rubbish trucks and other heavy transporters.
   The commission, the EU’s executive arm, believes the move would provide manufacturers with the guarantees they need to research and develop more of these kinds of vehicles for a larger market.
   ‘Faced with the growing problems caused by pollution in cities and the rise in the price of petrol, new means have to be found to help the automobile industry produce cleaner vehicles,’ transport commissioner Jacques Barrot said.

France’s engineering giant Technip and Japan’s Chiyoda have jointly won a 500-billion-yen ($4 billion) deal to build two liquefied natural gas plants in Qatar, a report said Wednesday.
   The order would be the largest of its kind in the world, constructing two plants each capable of producing 7.8 million tonnes of LNG a year, the Nihon Keizai Shimbun said without citing sources.
   A spokesman at Chiyoda said the company ‘had been in talks , but is not at the stage of issuing any comment.’
   The Japanese company plans to hold a news conference later in the day, the official added.
   The Nihon Keizai said formal signing on the deal would take place as early a Wednesday.
   The order was originally expected during the fiscal to March 2007, but was brought forward due to skyrocketing oil prices, the business daily said.
   The plants will use natural gas produced at Qatar’s North Field and are expected to come on stream by 2009, it said.
   Chiyoda and Technip will handle all operations, ranging from design to procurement of materials and construction, with the share by the Japanese company estimated at about 300 billion yen, it said.

India is planning more joint bids with Chinese firms for foreign oil projects after successfully teaming up for the Syrian oil and gas assets of Petro-Canada, a top Indian official said Tuesday.
   Petro-Canada said it will sell its mature Syrian oil and gas assets to a joint venture of companies owned by India’s Oil and Natural Gas Corp and China National Petroleum Corp for $578 million.
   ‘This is a significant milestone. We are looking at other projects to work together,’ the petroleum secretary, SC Tripathi said.
   Petro-Canada put its 38 per cent interest in the Royal Dutch Shell-operated Al Furat joint venture on the block in September.
   India, which imports 70 per cent of the oil it consumes, has encouraged state energy firms to bid aggressively for foreign petroleum assets to secure energy supplies for its economy, Asia’s third largest.
   ONGC has invested in projects in more than a dozen countries but lost out to Chinese rivals in Kazakhstan, Angola and Ecuador.
   Asian firms already have sunk billions of dollars in projects around the world, including in countries such as Sudan that are off-limits to oil majors.

Christmas and New Year are not official holidays in Dubai, but this does not prevent people from joining in the festive mood and packing the booming Gulf emirate’s many shopping malls
   In one of Dubai’s latest and biggest malls, a man in traditional garb snaps a photograph of his son in front of a huge silver and blue Christmas tree surrounded by skating mechanical penguins.
   ‘Of course we are Muslims and have our own holidays, but this holiday is another opportunity for kids to have fun,’ said the man, who did wish to be identified.
   In contrast to neighbouring Saudi Arabia, where Christmas is banned, Dubai’s holiday trappings and spirit are much appreciated by the significant expatriate community, which makes up the majority of the emirate’s estimated 1.2million population.

New Yorkers faced a second freezing day Wednesday fighting to get to work without subways or buses as some 34,000 transit workers continued their strike despite a $1 million per day fine for their union.
   While negotiations remained in deadlock between the Transport Workers Union and the Metropolitan Transportation Authority, residents of the Big Apple prepared again to walk, cram into cars with strangers or face the bitter cold on bicycles.
   The New York State Supreme Court judge, basing his ruling on a law prohibiting strikes on key public services, said Tuesday the TWU was in contempt of court for the stoppage and fined it $1 million for each day its workers remain off the job.
   The move increased the pressure on the union, as NY instituted emergency controls to prevent paralysis in the city in the busy pre-Xmas shopping week.
   The New York Times said Wednesday on the final day of negotiations, on Monday, MTA negotiators, after improving their wage offer and dropping their demand for an increase in retirement age, made a surprise demand that workers contribute 6pc toward their pensions, up from the current 2pc. The proposal would save the MTA less than $20m over the next 3 years, a small figure compared to the estimated $400m the city loses every day of the strike.

The market fundamentals and macroeconomic factors that lifted gold's price more than 25 per cent this year will drive it still higher in 2006, analysts said.
   Leading research houses and investment banks have raised their price forecasts saying market basics, economic growth and inflation and gold's classic safe-haven role could attract more players into the market.
   JPMorgan Securities have lifted its long-term gold price forecast to $500 an ounce from $450, with an average price of $558 in 2006 and $609 in 2007, while Merrill Lynch upgraded its 2006 estimate by 19 per cent to $525 an ounce.
   Most of the forecasts suggest average prices in the next year above $500, nearly double the level about five years ago.
   Last week, spot gold surged to $540.90 an ounce-the highest level in nearly a quarter of a century, but slipped by more than 7 per cent since then mainly on profit booking.
   The market was abuzz this month with talk that some central banks planned to add gold to their reserves.
   'If India, China and Japan are going to increase their reserves to a meaningful level for forex diversification, they will need at least around 4 to 5 years of mine production. The gold market is so small to allow for that,' said Yingxi Yu, precious metals analyst at Barclays Capital.
   Dealers and analysts say that worries about inflation on the back of higher crude oil prices and concerns about US economic growth, along with an unstable dollar, have boosted gold prices and the same factors would play a crucial role in 2006.
   Analysts said the dollar was likely to weaken in 2006 and that should provide further boost to the metal.
   Gold generally rises with a drop in the dollar as the metal becomes cheaper for other currency holders. But the traditional inverse relationship has been broken in the past several weeks.
   Analysts said it was the positive sentiment generated by bullish comments by industry experts at different forums that had been helping the metal, and positive fundamental factors also helped.

DSE closes higher
Trading at the Dhaka Stock Exchange closed higher Wednesday with the gainers dominating the losers. The DSE All Share Price Index increased by 12.93 points or 1.03 per cent to close at 1267.32. Around 1.39 million shares and debentures worth Tk 16.16 crore were traded on the floor of the DSE on Wednesday. A total of 150 issues were traded on the day. Of them, 71 issues advanced, 56 declined and 23 remained unchanged.
— New Age

CSE ends down
Trading at Chittagong Stock Exchange closed higher Wednesday with the gainers dominating the losers. The CSE All Share Price Index increased by 27.41 points or 0.82 per cent to close at 3357.87 points from Tuesday’s 3330.46 points. The CSE-30 Index also enhanced by 32.24 points or 1.05 per cent to close at 3096.75 points from 3064.51 points on the previous trading day. A total of 61 issues were traded Wednesday. Of them, 34 gained, 20 declined and seven remained unchanged. Some 402,969 shares and debentures worth Tk 4.80 crore changed hands Wednesday against some 736,502 shares and debentures worth Tk 3.59 crore on the previous trading day.
— UNB

Repo auction held
The repo auction for commercial bank and financial institution was held t the Bangladesh Bank on Wednesday., December 21. One bid 1- day tenor amounting to Tk cr was received but that was not accepter.
— New Age

Gold hits 4-week low
Gold fell to its lowest level in four weeks Wednesday as investors’ unwound positions before the end of the year, dragging other precious metals with it. But overall sentiment remained bullish, with physical buying expected to resurface at lower levels and investors diversifying into commodities due to worries about rising energy costs, fears of terrorists attacks and dollar stability. Gold, used as jewellery and investment, rose to its highest level in nearly 25 years at $540.90 an ounce on December 12, because of those factors. Spot gold fell to a low of $489 a ounce—it’s lowest since November 23 —before rebounding to $490.50/491.30 in afternoon trade, still lower than $492.90/493.70 late in New York on Tuesday. ‘We see very thin trading conditions at this time of the year.
— Reuters

Indian Oil Corp raises $300m foreign loan
Indian Oil Corporation Ltd. said on Wednesday it had raised $300 million through a syndicated loan to fund expansion. The maturity of the loan was five years. The loan has a core size of $250 million with a greenshoe option of $50 million. ‘It received overwhelming response from the investors and the loan facility was oversubscribed by about two times,’ IOC said in a statement. BNP Paribas, Calyon Bank, Citigroup, ING Bank N.V., Mizuho Corporate Asia, Sumitomo Mitsui Banking Corporation and the Bank of Tokyo Mitsubishi arranged the deal.
— Reuters

ExxonMobil holds out against Venezuela
US energy giant ExxonMobil said it was evaluating its position in Venezuela after receiving an ultimatum from the country’s left-wing government to join a state-backed venture or else. ExxonMobil is now the only foreign major active in the world’s fifth-largest oil exporter that has refused to scrap its current contract and accept a minority partnership with Venezuela’s state oil firm. Through its local affiliate, Ampolex Venezuela, ExxonMobil has a 25-percent stake in the country’s small Quiamare-La Ceiba oil field. The rest of the venture is controlled by Spanish company Repsol. Repsol is said by the socialist government of President Hugo Chavez to be willing to go into partnership with the state-run Petroleos de Venezuela.
— AFP

Barclays opens first China branch
Barclays, Britain’s third biggest bank, said that it opened its first branch office in Shanghai, a move that will allow it to expand its services in China’s fast-changing financial landscape. Barclays, which only had a representative office in China before, can now provide money market and foreign exchange trading and advice on risk management and debt financing for its mainland clients, a statement said. ‘China is clearly a key market for us in Asia and the new license is an important part of our expansion in the region,’ said Robert Morrice, Barclays Asia chairman. ‘Chinese companies are entering the next stage of development where they need greater access to financing and are keen to employ the most advanced and innovative forms of risk management,’ said Morrice.
— AFP

GM shares fall
to 18-year low
Shares of General Motors Corp. fell to an 18-year low on Tuesday after Toyota Motor Corp. unveiled production plans for 2006, increasing fears that GM will be toppled by its Japanese rival as the world’s largest automaker. Toyota said it plans to make a record 9.06 million cars in 2006, just shy of the 9.15 million cars and trucks that some analysts expect GM to build next year. Shares of GM were down $1.05 cents, or 5 per cent, at $20 on the New York Stock Exchange. The stock fell to $19.63 earlier in the day—its lowest point since 1987, after being adjusted for its spin-off of Delphi Corp. in 1999. Shares have plunged nearly 50 per cent this year. GM does not provide sales or production forecasts on an annual basis, but some analysts said the current trend points to GM’s inevitable tumble to second place for the first time in 70 years.
— Reuters

UAE, Pakistan rescue telecoms deal
Pakistan and the United Arab Emirates clinched a deal Tuesday to salvage the $2.6 billion privatisation of Pakistan Telecommunication Co Ltd, but gave no details of the rescue plan. Pakistan’s biggest privatisation ran into trouble when UAE monopoly Emirates Telecommunications (Etisalat) failed to meet payment deadlines for the 26 per cent stake in PTCL after topping the next highest bid by $1.2 billion. An Etisalat team will fly to Pakistan next week to finalise the transaction, which will be completed in January, the statement said. The two sides have been trying to salvage the deal since the October 28 payment deadline lapsed, leaving Pakistan facing a huge hole in its $18.4 billion budget for the year to June. Etisalat, which is expanding rapidly abroad, had sought to raise some of the cash for the payment in Pakistan. Islamabad refused, but officials later said the government was warming to the idea. Sources at Etisalat as well as the Pakistani government have said Pakistan will allow Etisalat to complete the payment in instalments over the next two to five years.
— Reuters