Main Page «
Front Page «
Metro «
International «
Sports «
National «
Editorial «
Op-Ed «
Home «
Timeout «
Letters «

Archive «
Launch Supplement «
Special Supplements «

With only three months of the current fiscal year left, many sectors of the economy trail far behind their budgetary targets due to less availability of resources from both local and foreign fund sources.
   Both the revenue and development expenditures lay far behind the targets set in the national budget for the fiscal year 2005-06, official figures showed.
   Lower-than-expected supply of funds has already forced the government to decide to trim the development and non-development expenditures by 8 and 10 per cent respectively for the current fiscal year.
   The revenue collection by the National Board of Revenue during the July-February period of the current fiscal year increased by Tk 2,292 crore or 13 per cent to Tk 19,806.87 crore over the same period of last fiscal.
   But the collection still stands below the 60 per cent of the total annual target worth Tk 35,652 crore, although nine months of the financial year have already elapsed. Revenue officials are unsure about achieving the rest 40 per cent of the target in the remaining three months.
   The finance and planning minister, M Saifur Rahman, himself was doubtful about reaching the revenue target, as he rebuked the top revenue officials for the lax performance and asked them to strengthen the collection drive at a meeting on March 29.
   The minister is expected to meet the revenue officials in 15 days to review the improvement.
   Yet, NBR top officials have already hinted that the revenue target might be revised downward, a rerun of the previous years’ practice towards the end of fiscal year.
   The total revenue collection target for 2004-05 was set at Tk 41,300 crore which later revised down to Tk 39,200 crore.
   Even the revised target could not be met.
   Revenue officials, however, do not find anything wrong in setting higher target and missing it routinely every year, as they claim phenomenal growth in earnings year-on-year.
   The actual revenue earnings in the last fiscal stood at Tk 37,353 crore with NBR accounting for Tk 29,047 crore, as shown in the fiscal report of the finance ministry.
   The total development outlay for the current fiscal year has been set at Tk 26,554 crore, including a Tk 24,500 crore annual development programme.
   Repeating the practice seen in the last few years, the government is now busy looking which projects could be dropped and which prioritised in line with a cut-down development outlay.
    In the last fiscal year, development expenditure was cut down to Tk 22,676 crore from the original of Tk 23,839 crore. Again, the real expenditure was below Tk 20,000 crore.
   The national budget has set Tk 38,082 crore for non-development expenditure for the current fiscal year while real expenditure during the first quarter of the current fiscal stood Tk 6,000 crore. The figures of second and third quarters were not available.
   The government usually avoids cutting the non-development as well as revenue expenditures. But, this time the government mulls over slimming revenue expenditure by 10 per cent, which mirrors the awkward budgetary management.
   The finance minister last week asked the ministries to rationalise and economise spending and be extremely cautious in spending money.
   Apart from poor revenue earnings, excessive spending on petroleum import has bled the exchequer dry, forcing the government to decide last week to implement 31 priority projects under ADP out of the total 94 approved ones for fiscal 2005-06.
   Sluggish disbursement of foreign fund put the finance minister in a troublesome position to implement the budget having outlay of Tk 64,383 crore.
   Despite swallowing bitter pills prescribed by the international financial institutions, Saifur failed to get expected supports from the World Bank and International Monetary Fund to back up the development budget and balance of payment.
   During the July-January period of the current fiscal year, total external fund disbursement stood at $578.71 million compared to $896.40 million in the same period of the previous fiscal, showed the Economic Relations Division data.
   But, net foreign aid during the period under review stood at $294.71 million compared to $623.40 million in the same period of the last year as government has to repay some $284 million as principal amount of foreign loans.
   The lower flow of external assistance forced the government to borrow from both the banking and non-banking sources.
   Bangladesh Bank figure showed that domestic sources accounted for 63 per cent of the total deficit financing worth Tk 5276 crore in July-January period of the current fiscal year while the rest 37 per cent came from external sources.
   To bankroll the development budget, 55 per cent fund was expected from external sources and 45 per cent from domestic sources.

The market capitalisation at the Dhaka Stock Exchange (DSE) declined by Tk 10.47 billion and turnover Tk 182.81 million in the first quarter of the current year due to steady fall in the share prices.
   Trading statistics at the DSE shows that the total market capitalisation at the DSE on March 30 stood at Tk 218.10 billion against Tk 228.57 billion on the opening trading day on January 1, 2006.
   The DSE General Index lost 185.58 points or 11.07 percent during the January-March period of the current year as against the general index on the last trading day of 2005.
   Prof Abu Ahmed of Dhaka University attributed the bearish trend in the capital market to the hike of interest rate in the FDRs in the commercial banks.
   ‘Funds are out-flowing from the capital market to the FDRs now. Banks are offering 12 percent interest on FDRs on an average,’ he told BDNEWS.
   He said the market could perform better if the government reduced the corporate tax rates for the listed companies. ‘NBR should charge extra taxes on the multinationals or cell phone operators here unless they go public,’ he added.

An amount of Tk 668.19 crore was defaulted with 17 banks in Barisal against their disbursed loans of Tk 1,932.48 crore, about one third of the total amount.
   The Bangladesh Bank sources said Tk 87.66 crore default loans were with the top ten borrowers here and the bank authorities lodged 19,556 cases to recover Tk 154.48 crore classified loans.
   Sources said Tk 11.63 crore was defaulted with the Al Arafa Islami Bank which disbursed Tk 14.6 crore, having 60 per cent default rate.
   The Bangladesh Krishi Bank has 45 per cent of the disbursed amount as default loans worth Tk 293.40 crore out of Tk 646.30 crore.
   The Sonali Bank has default loans worth Tk 133.41 crore which was 33 per cent of the total disbursed amount of Tk 399.81 crore.
   Besides, default loan amounts were 66.37 crore out of 240.74 crore (28 per cent) with the Agrani Bank, 70 crore out of 350 crore (20 per cent) with the IFIC Bank, 26.22 crore out of 156.66 crore (17 per cent) with the Janata Bank, 16.69 crore out of 106.04 crore (16 per cent) with the Rupali Bank, 10.06 crore out of 68.03 crore (15 per cent) with the Uttara Bank, 6.32 crore out of 58.73 crore (11 per cent) with the Pubali Bank, 0.55 crore out of 6.25 crore (9 per cent) with the City Bank, 10.7 crore out of 139.9 crore (8 per cent) with the Shilpa Bank, 1.33 crore out of 28.31 crore (5 per cent) with the National Bank, 2.8 crore out of 108.9 crore (3 per cent) with the Islami Bank, 3.3 crore out of 11.31 crore (3 per cent) with the Oriental Bank, 1.16 crore out of 13.1 crore (3 per cent) with the AB Bank, and 0.2 crore out of 37.46 crore (.05 per cent) with the Prime Bank respectively.
   According to the Bangladesh Bank data, newly opened Basic Bank and Premier Bank disbursed Tk 4.3 and 10.45 crore loans respectively, but they have no classified loans because of their comparatively short operational period.
    Ansar Ali, manager of Al Arafa Bank, Barisal branch, said among the top ten loan defaulters, Swapan Das, a businessman of Swa Road area of the city, went to India after taking Tk 1.76 crore loans.
   Progoti Agency, agents of multinational companies, took Tk 2.43 crore and Md Mamun, a BNP leader, took Tk 0.63 crore loans.
   Eleven cases were filed against the classified loan defaulters, the managers added.
   The Krishi Bank sources said, most of the borrowers were from low income groups and 7,197 cases were filed against the defaulters.
   Besides, the numbers of cases lodged against the classified loan defaulters were: 5,998 by the Agrani Bank, 3,655 by the Sonali Bank, 1,952 by the Janata Bank, 365 by the Rupali Bank, 234 by the Pubali Bank, 105 by the Uttara Bank, 13 by the National Bank, 8 by the IFIC Bank, 7 by the Islami Bank, 4 by the Shilpa Bank, 3 by the City Bank, 2 by the AB Bank, 1 by the UCBL and 1 by the Prime Bank.
   Bishnu Pada Malakar, general manager of the Barisal branch of Bangladesh Bank said, the central bank regularly monitors loan sanctioning, classified loans and recovery rates of the scheduled banks.

Country’s first state-of-the-art modern meat processing industry, Bengal Meat, has launched commercial production pledging supply of fresh, hygienic and halal meat to local consumers as well as foreign market.
   ‘Our vision is to serve Bangladeshi people with premium quality meat and meat products at challenging prices,’ Mazharul Islam, chairman of the company, said at the launching ceremony at the Hotel Sheraton Thursday.
   Officials of the country’s most sophisticated abattoir set up in the northern region with Australian technology said, initially, they would supply around 10 tonnes of meat—mainly beef and mutton—per day to local market. The products will be made available at the luxury hotels, restaurants and superstores in Dhaka and Chittagong cities, they said.
   Bengal Meat, dressed and packed with international standards, would cost Tk 10-20 more per kilogram than beef or mutton sold in butchers’ shops.
   The modern meat processing plant, set up with a daily capacity of 20 tonnes at Shanthia of Pabna, would also maintain reliable live cattle’s supply chain through organised and scrutinised procurement and monitored rearing.
   At present some 27,000 cattle, mainly cows and goats are slaughtered in Bangladesh every day, but processing of meat is not standardised, officials of the company said.
   Ministers Abdul Mannan Bhuyian and Shamsul Islam spoke at the launching ceremony.

Migrant workers in high-income countries remitted a record of more than $167 billion to their families last year, a UN agency said as it called for measures to ensure the money is used for long-term development.
   In countries including Bangladesh and the Philippines, annual remittances exceed official development aid and foreign direct investments, the UN Economic and Social Commission for Asia and the Pacific said in its latest report released Thursday.
   If remittances sent through informal channels are counted, the figures could rise by as much as 50 per cent, the UN’s economic and social arm said.
   The agency urged governments in recipient countries to cut the costs of sending money home and help the workers’ families channel the funds into more productive endeavours.
   Countries exporting migrant workers should also take steps to improve their skills and tighten policies to ensure they do not fall prey to unscrupulous recruitment agencies, UNESCAP said.
   ‘Policy-makers need to recognise that remittances are private flows of money that need to be treated as such. Therefore, these flows should not be taxed,’ it said.
   The money has already been taxed in the country of origin and imposing taxes will discourage workers from sending funds through the banking system, it added.
   It noted that levies charged by remittance service providers ‘are very high’, with fees for small transfers reaching as high as 10-15 per cent.
   ‘There is no doubt that more can be done to increase the volume of home remittances and to enable the recipients to use them more effectively,’ UNESCAP said.
   ‘Additional measures should be taken to increase the access of poor migrant workers and their families to formal financial institutions.’
   UNESCAP urged banks in the workers’ home countries to establish branches in host nations and allow micro-credit institutions and credit unions to transfer funds to rural households.
   The agency also said governments should give the right information about job opportunities to prevent situations in which families borrow huge sums to send a worker abroad, only to discover that the earnings are not enough to recover the cost.
   As of 2004, three of the top five remittance-receiving countries in the world were located in Asia—India which received $21.3 billion, China with $21.7 billion and the Philippines with $11.6 billion, the report said.
   Bangladesh, Pakistan and Sri Lanka are also among the major recipients of remittances, while Cambodia, Laos, Myanmar, Nepal, Thailand and the Pacific island of Samoa benefit to a lesser extent.
   In the Asia Pacific region, Australia, Hong Kong, China, Japan, New Zealand, South Korea and Singapore are major sources of remittances for developing countries.
   For Laos and Myanmar, neighbouring Thailand is a key source of workers’ remittances, UNESCAP said.
   Outside the region, Canada, the United States, Britan, France, Saudi Arabia and the Gulf States are the main source of foreign workers’ remittances.
   An increasing number of remittance-senders are women, it noted.

Seven more Rupali Bank officials have been suspended for their gross irregularities and nepotism in sanctioning Tk 25 crore loans to 16 BNP leaders in Barisal.
   Two officials were earlier suspended and the Barisal zone deputy general manager was closed to the head office on March 16 on charge of gross violation of rules in sanctioning such a huge amount of loan from a relatively smaller branch at Nathullabad in the city.
   According to bank sources, suspension of the seven was made through a letter, signed by a general manager in the head office, and the letter reached Barisal on Wednesday.
   The Barisal zone deputy general manager, Nasiruddin, acknowledged the matter.
   The seven are Shahidul Huq, the Barisal zone DGM who was closed to the head office, Humayun Kabir, second officer at the Nathullabad branch, Habibur Rahman Khan, a former officer at the branch and now a senior officer at the Sadar Road branch, Shah Alam, cash officer at the branch, Abdur Rab, senior principal officer and Habibur Rahman Biswas principal officer at the audit and inspection cell, and Abdul Khalek, a senior officer at the branch now working at the inspection cell.
   The earlier suspended officials are Shamsur Rahman
   and Makbul Hossain, manager and senior officer at the branch. A case was also filed against them.
   The bank sources said Rab and Habib had been suspended for their failure to find out the irregularities in sanctioning the loan during audit while others for their direct involvement in the scam.
   The two, however, claimed that they could not find out the irregularities due to insertion of fake account adjustment reports and related documents by the branch officials during audit.
   Zannatul Islam Nayan, city unit secretary of BNP’s cultural wing Jatiyatabadi Samajik Sangskritik Dal and president of ward 18 Mahila Dal, alone received Tk 21.47 crore loan against her firm, Ani Enterprise.
   The rest of the Tk 25 crore was disbursed among 15 other BNP leaders many of whom have already become loan defaulters.
   The actions come following an inquiry committee report submitted on March 14.

India has renewed a transit treaty with landlocked neighbour Nepal which will allow the Himalayan country to export its goods through Indian ports, the Indian foreign ministry said Friday.
   ‘Following the completion of the review process... the Treaty of Transit between India and Nepal which was in force up to January 5, 2006 has been renewed ... for a further period of seven years,’ the ministry said in a statement.
   According to the ministry, the transit treaty provides Nepal with port facilities at the eastern Indian city of Kolkata.

The Chittagong Port Safeguarding Committee on Friday accused the port authority of artificially curtailing the handling capacity of four rail-mounted key gantry cranes through installation of computer software.
   ’The port authority has reduced the handling capacity of the cranes with an ill motive to
   prove failure of local operators and make room for foreigners,’ the committee secretary general, Mahfuzur Rahman Khan, said in a written statement at a press conference at the Chittagong Press Club auditorium.
   The committee president, Golam Mohammed Chowdhury and other members, including Jahangir Alam Chowdhury, Abu Jafar Azad, Jahangir Alam, Abdul Ahad, Abdul Khaleque Chowdhury, Mohammed Iskander Mia, Mohammed Ilias and Sirajul Islam were present there.
   They said that the authority was conducting different subversive acts to implement the blueprint of handing over the New Mooring Container Terminal and Chittagong Container Terminal to the private operators.
   They added that the authority had recently transferred all the 15 technicians of the port, who were engaged in repairing different types of equipment, to the marine engineering department. The wholesale transfer would hamper the port activities seriously, they felt.
   The committee leaders demanded the authority stop what they termed all sorts of conspiracy to hand over the NCT and CCT to the private operators and to appoint the foreign operators for the gantry cranes.
   Otherwise, they threatened of tougher movement to save the port and stop drainage of hard-earned foreign currency in the name of hiring foreign experts.

Sri Lanka’s economy expanded by 5.9 per cent last year, up from 5.4 per cent the previous year, on the back of higher garment exports, the Central Bank of Sri Lanka said Friday.
   Agriculture and telecommunications also added to the higher growth, the bank said in a statement.
   It said the fourth quarter of last year recorded a growth of 6.3 per cent, maintaining an uninterrupted expansion every quarter since February 2002 when a truce between government troops and Tiger rebels went into effect.
   The ceasefire put the breaks on a three-decade-old ethnic conflict which had claimed over 60,000 lives since 1972.
   The bank noted that the economy was able to record the high growth rate despite higher international oil prices.

An exceptional agreement has been signed between summer vegetable growers and traders aimed at benefiting each other for the first time in the northern region, concerned sources said.
   The sources said the agreement on selling and purchasing was signed at a discussion meeting at Shibpur Ideal Farmers’ Club building under Puthiya upazila on Thursday.
   Some 50 persons, including 10 farmer leaders, representing some 500 vegetable cultivators of Paba, Mohanpur and Durgapur upazilas, development activists and local service providers attended the meeting.
   Representatives of vegetable growers signed the contract with leaders of Shibpur Traders’ Multipurpose Cooperative Society, who have been supplying green vegetables to different wholesale markets in Dhaka after collecting from the fields directly for a long time.
   Under the agreement, growers will produce vegetables and sell those to traders based on their demands on cash payment.
   The strategy of fixing price of the produce and exchange of money would be settled through consensus, analysing and considering local market prices by both sides.
   The traders’ side would appoint a trained local service provider for a farmer cluster so they could get necessary services and know-how, particularly quality seeds, production technology and marketing.
   The service provider will visit selected farming fields at least once a week and provide necessary suggestions to growers.
   Side by side with extending advice on availability of quality seeds, they would be accountable to farmers for technical support necessary for vegetable production.
   Sources said targeted farmers would start farming different high yielding varieties of summer vegetables like bottle gourd, bitter gourd, yard-long bean and ash gourd on around 300 acres in the coming month of Boishakh (April-May), which are expected to arrive in the market in the month of Ashar (June-July).
   Through maintaining proper communications and exchanging update information with growers and traders, the LSPs would select field-level places suitable for selling and purchasing along with fixing dates.
   Partnership for Agro-product Development and Market Access (PADMA) Project in collaboration with two international development agencies—-Inter-cooperation and KATALYST—-has mediated the agreement signing process. With president of STMCS Kafil Uddin in the chair the meeting was addressed, among others, by team leader of PADMA project Maksudur Rahman, secretary of STMCS Abdul Quddus and other officials of the project.
   In case of any failures in fulfilling the terms and conditions of the contract, both sides would identify the causes of the failures and devise ways and means to overcome them. With the contract, team leader Maksudur Rahman said farmers would be interested in quality vegetable production in a big way as they will not face any anxiety about marketing of their produce. On the other hand, traders would be able to supply green vegetables to markets properly, resulting in establishment of good relations between growers and traders.

The United Arab Emirates rejected as ‘insane and illogical’ Thursday a human rights report that described abuse of mainly foreign migrant labourers, thousands of whom have protested their conditions.
   ‘To link what happened (protests) to the construction boom in the country—which represents a sign of progress in the region—or to negotiations on free trade is really devious, illogical and insane,’ Labour Minister Ali al-Kaabi told the Al-Khaleej daily.
   New York-based Human Rights Watch, in a report issued Tuesday, accused ‘one of the world’s largest construction booms’ of ‘feeding off of workers in Dubai, but they’re treated as less than human.’
   The report cited low pay, failure to pay wages and ‘as many as 880 deaths... at construction sites in 2004.’
   Government figures show 34 people died on construction sites in 2004.
   The rights group called on the United States, European Union and Australia, which are currently negotiating free trade agreements with the UAE, to ‘require improvement of UAE’s labour practices and legal standards before signing such agreements.’
   Kaabi also dismissed a massive protest last week at the site of what will be the world’s tallest skyscraper as a protest in which workers ‘were not demanding their rights.’
   Around 2,500 mostly Asian workers at the site of the Burj Dubai protested over pay and work conditions. Some turned violent, smashing cars and offices causing damage estimated at one million dollars.
   The demonstration then sparked a strike on a construction site where workers are enlarging Dubai’s airport.
   ‘It has been proven that the companies concerned completely respect their commitments and their contracts’ with workers, Kaabi said.

Malaysia on Friday unveiled a five-year development plan worth 54 billion dollars aimed at tackling poverty and spurring economic growth in its quest to become the first developed Muslim nation.
   The 2006-2010 Ninth Malaysia Plan is the first since Prime Minister Abdullah Ahmad Badawi came to power in 2003 and closes the door on an era of ambitious mega-projects under former premier Mahathir Mohamad.
   ‘The quality of life enjoyed by Malaysians has improved. Nevertheless great disparities in income and wealth still exist, especially between ethnic groups and between rural and urban areas,’ Abdullah told parliament.
   ‘Malaysia must overcome these myriad challenges astutely and effectively ... we have no time to lose,’ he said as he released the plan.
   The blueprint which focuses on rural development, education and stimulating economic growth, is to be rolled out at a cost of 200 billion ringgit (54 billion dollars), compared to 170 billion ringgit for the previous plan.
   At the midway point on Malaysia’s path to achieving developed nation status by 2020, it targets economic growth of 6.0 per cent over the next five years, and 6.5 per cent from 2011 to 2020.
   Sucessive five-year economic plans have tried to bridge the wealth gap between urban and rural areas but the government has acknowledged that the divide has only become wider.
   While children at public schools in Kuala Lumpur enjoy computer facilities and sports grounds, Abdullah admitted that hundreds of rural schools lack electricity and piped water and that 1.15 billion ringgit would be spent to upgrade them.
   The plan aims to totally eradicate extreme poverty in Malaysia, addressing the plight of some 300,000 citizens or 1.2 per cent of the population of 26 million who survive on 112 dollars a month.
   ‘The government strongly believes in eradicating poverty, generating more balanced growth and ensuring the benefits of growth are enjoyed by the Malaysian people in a fair and just manner,’ Abdullah said.
   It also tackles the continuing income disparity between the majority ethnic Malays, or bumiputeras, who make up some 60 per cent of the population, and the minority ethnic Chinese community which largely controls the business sector.
   Abdullah referred to 1960s civil strife which he said was the result of ‘strained relations between different ethnic groups caused by inequitable distribution of the country’s economic cake.
   ‘If unaddressed, these disparities can threaten the harmony and stability we enjoy and consequently thwart the country’s economic development,’ he warned.
   The plan includes new inititiatives in the government’s long-running campaign to increase the share of corporate equity held by bumiputera from current levels of 18.9 per cent to at least 30 per cent by 2020.
   It will also try to harness the private sector as an engine for growth, by encouraging corporations to finance and manage infrastructure projects which will be leased back to the government.

French unemployment is falling, growth is rising and overspending is finally under control, the finance minister said on Friday hours before President Jacques Chirac was to address the nation on a crisis over jobs for young people.
   On the hot issue of unemployment, which has led to weeks of sometimes violent protests, Thierry Breton predicted that 200,000 jobs would be created and that the jobless rate would drop below 9.0 per cent by the end of the year.
   ‘This very favourable evolution stems of course from growth but also from the results of the measures taken by Prime Minister Dominique de Villepin in favour of employment and notably the CNE (first employment contract) and the social cohesion plan,’ he told a press conference.
   Official data released earlier Friday showed the jobless rate had fallen by 0.4 per cent in February, after a rise of 0.7 per cent in January, but that it still stood at 9.6 per cent.
   The latest figures are likely to be interpreted as offering the centre-right government some encouragement in pursuing its employment policies despite intense opposition and widespread public hostility.
   A plan by the prime minister to get more young people into jobs has turned into one
   of the worst crises in Chirac’s 11-year presidency—sparking a protest movement that on Tuesday brought more than a million people onto the streets.
   Chirac was to make a long-awaited address to the nation on the disputed youth jobs contract later on Friday, amid predictions that he would stand by his prime minister and defy the growing protest movement by signing the measure into law.
   Breton said at his press conference that the French economy was on course for lasting growth of 2.0-2.5 per cent per year from 2006.
   ‘Our economy has solidly entered a growth regime,’ he said.
   Earlier Friday, official data estimated that the French economy grew by 1.4 per cent in 2005, confirming an earlier estimate but raising growth in the last quarter to 0.4 per cent from 0.2 per cent.
   Breton also announced that France had finally cut over-spending to within EU limits last year, after years of excessive deficits.
   ‘After several years, France has returned within the limits of the Treaty of Maastricht as it had undertaken to do,’ he said.
   The public deficit was at 2.87 per cent of output in 2006 and was set for 2.8 per cent this year, within the EU ceiling of 3.0 per cent, said Breton.
   The INSEE natinal statistics institute had reported earlier on Friday however that that the
   public debt had risen to 66.8 per cent of output from 64.4 per cent in 2004.
   A sensitive issue in public finances in France is the size of the civil service and the question of reducing it as the post-war generation retires. On Friday Breton said the large staff at his ministry would continue to be reduced this year. About 2,600 posts are set to be cut there in 2006.

Japan’s economy showed fresh signs of coming out of its decade of hibernation Friday with unemployment at a seven-year low and consumer prices up for a fourth straight month as deflation fades.
   Japan’s unemployment rate fell by more than expected in February to 4.1 percent from 4.5 percent the previous month, the lowest level since July 1998, the government reported.
   The data exceeded market expectations for a 0.1-percent dip to 4.4 percent.
   The unemployment rate is watched closely for evidence of expanded hiring by Japanese companies and the positive knock-on effects on consumer spending.
   Confidence is growing that the world’s second-largest economy is finally on a solid recovery path after its long slump, as reflected by the central bank’s recent decision to scrap its five-year deflation-fighting monetary policy.
   Stirring speculation about when the central bank will start raising official interest rates, core consumer prices rose 0.5 percent year-on-year in February, the government said.
   The increase was slightly smaller than the 0.6 percent gain the market had expected but nevertheless provided further evidence that the world’s number two economy is finally breaking free of its deflation doldrums.
   Japanese share prices rose 43.42 points or 0.25 percent to 17,088.76 in opening trade in the wake of the data, a day after smashing through 17,000 points for the first time in more than five years.
   The Tokyo stock market rose 40 percent last year and after a brief pullback has scaled new peaks on confidence that the recent end to the central bank’s super-loose monetary policy will not derail the economic recovery.

World oil prices showed mixed fortunes on Friday at the end of a week in which they have surged owing to global supply concerns.
   New York’s main contract, light sweet crude for delivery in May, fell by 27 cents to 66.88 dollars per barrel in electronic deals before the market’s official opening.
   In London, the price of Brent North Sea crude for May delivery gained 29 cents to 66.75 dollars per barrel in electronic trade.
   Crude futures have risen by more than three dollars this week owing to falling gasoline (petrol) inventories in the United States, the world’s biggest energy consumer, and tensions in major crude producers Nigeria and Iran.

Indian officials have cleared a key obstacle to the country’s largest aviation merger between Jet Airways and Sahara
   Airlines following a dispute over landing rights, reports said Friday.
   An aviation committee recommended the full transfer of Sahara Airlines’ assets to India’s largest domestic carrier Jet Airways including parking bays and landing slots, according to the Press Trust of India quoting sources.
   The deal was struck in January but talks had reportedly been stuck over whether the government would approve the transfer.
   Saroj Datta, executive director of Jet Airways, declined to comment on the reports. ‘We have received no official
   communication,’ he said.
   The decision still needs to be approved by the Indian Government, along with new guidelines on mergers between airlines, according to PTI. They are expected next week.
   Merger talks between executives of the two airlines, to create a company with almost half the domestic market, were extended for another three months earlier this week.

The social welfare minister, Ali Ahsan Muhammad Mujahid, Friday said the government has been providing credits along with training to the people to make them economically self-reliant.
   ‘Vocational training on various trades, including rearing of poultry and livestock, fisheries, sewing, tailoring and nursery, are also being given to attain the success,’ he said while distributing interest-free loans and old-age allowances among the people of Mostafapur union in the district.
   Old-age allowances of Tk 3.66 lakh were distributed among 320 people and loans of Tk 1.05 lakh were disbursed among 21 persons of Mostafapur union.
   Presided over by Madaripur Sadar upazila UNO, Abdul Matin, the function was addressed, among others, by Begum Tasmin Ara, MP, Mozammel Hoque and Kazi Abul Bashar.
   Mujahid said the present government has increased the amount of old-age allowance gradually to establish the self-dignity of elderly poor in society.
   The number of old-age allowance recipients was only 81 during the past government which has been increased to 320 in Mostafapur union, he added.
   The minister also distributed allowances among 501 elderly people of Madaripur pourasabha through a function held in the Muktijoddha auditorium this afternoon.

An Indian electronics whiz who set up a pirate radio station for just one dollar has been offered support from abroad after the government shut him down, a report said Friday.
   A Britain-based Indian doctor and an Australian are among many who have offered their assistance to Raghav Mahto, who ran the private radio station called FM Mansoorpur, the Hindustan newspaper reported.
   Raghav has already received overwhelming support from listeners to his broadcasts of Bollywood movie music who have offered to donate money to pay for a licence and keep him on the air.
   FM Mansoorpur, named after Raghav’s home village, was set up three years ago using bits and pieces from his electronics repair shop.
   It was closed earlier this week by the federal government for not having a licence.
   The move to close the station came after New Delhi invited bids in January for more than 300 new FM radio stations across the country.
   Local officials were unsure of the cost of a licence but said it could be at least 100,000 rupees (2,220 dollars), a sum Raghav cannot afford.
   According to the Hindustan, a British-based Indian doctor, another overseas Indian and an Australian are among those who have offered to help bring him back to the airwaves.

China has expressed regret at the latest trade rift with the United States and Europe but says it will consider their complaint that it is unfairly blocking foreign-made auto parts.
   The United States and the EU announced Thursday they had lodged a complaint with the World Trade Organization over the issue, which enables them to call for dispute settlement consultations with China.
   ‘China expresses regret at this,’ commerce ministry spokesman Chong Quan said in a brief statement.
   ‘China is studying the consultation requests from the European Union and the United States seriously.’
   Under WTO rules, China has 10 days to answer the request
   for talks and has to start
   consultations within 30 days.
   If a resolution is not found within 60 days, the parties can ask a WTO panel to rule in the dispute.
   US and EU officials object to what appears to be domestic content requirements for autos made in China, with tariffs on certain imported parts.
   US officials have criticized them as inconsistent with China’s WTO commitments.
   A statement from the office of the US Trade Representative said China’s taxes on imported auto parts ‘discourage automobile manufacturers in China from using imported auto parts in the assembly of vehicles.
   ‘As a mature trading partner, China should be held accountable for its actions and be required to live up to its responsibilities,’ US Trade Representative Rob Portman
   said Thursday in Washington.
   In Brussels on Thursday, officials said they hoped to resolve the complaint through the consultation process.
   ‘It remains my strong preference and intention to seek an amicable solution to this issue,’ EU Trade Commissioner Peter Mandelson said in a statement.
   The auto dispute is the latest rift between China and its two biggest trading partners, with tensions appearing to have spiked recently with the United States voicing the loudest complaints over Beijing’s trade practices.
   The US trade deficit with China hit $202 billion for 2005, up 24.5 per cent, fuelling US concerns that Beijing is manipulating its currency to give Chinese exporters an unfair advantage.
   US President George W. Bush has said China’s trade practices will be high on the agenda when Chinese President Hu Jintao visits in April.
   Meanwhile, the EU this week said it had imposed a 44.6-per cent anti-dumping duty on imports of Chinese colour televisions after a mainland TV maker refused to allow European officials to inspect its premises.
   Konka Group, one of China’s largest TV makers, had rebuffed a European request to make an on-site examination to verify that an earlier agreement was being kept, triggering the European move, the EU said.
   The EU also announced last week it would impose tariffs on Chinese-made leather shoes for alleged unfair trade practices.
   The shoe dispute followed a similar rift China had with the United States and Europe last year over a wave of cheap clothing imports.

A quarter point rise in US interest rates to 5.0 per cent will cut Asian economic growth next year by half a per centage point, the United Nations’ social and economic arm said Thursday.
   The UN Economic and Social Commission for Asia and the Pacific (UNESCAP) also warned that an unwinding of the US balance of payments deficit would have ‘serious repercussions’ on regional economies.
   The US Federal Reserve on Tuesday raised its benchmark interest rate to 4.75 per cent, its 15th straight increase since it began monetary tightening in June 2004, and said rates could still go higher.
   If the Fed raises rates by another quarter point in the third quarter of this year, Asia’s economic growth will slow by 0.5 per cent in 2007 due to a time lag of about 18 months, UNESCAP executive secretary Kim Hak-Su said.
   ‘If the Fed increases to 5.0 per cent, we estimate Asian gross domestic product (GDP) growth will decline by 0.5 per cent in 2007,’ he told the Foreign Correspondents Association.
   UNESCAP’s current forecast for 38 developing economies in the region is for 6.5 per cent real GDP growth in 2006.
   Should interest rates rise above 5.0 per cent and regional economies slow down, ‘it will chill the property market and stock market, so we must be very careful,’ said Kim, in Singapore to launch UNESCAP’s annual report.
   Kim also said an unravelling of the US trade imbalances with the rest of the world—the United States buys more than it exports—would seriously hurt Asian and global economies.
   ‘A precipitous unwinding of these imbalances could create large upheavals in international financial markets, causing exchange rate instability involving the dollar and several currencies in the region,’ the UNESCAP report said.
   This will ‘lead to a substantial slowdown in economic activity, with Asia’s GDP growth declining by about 2.6 per centage points,’ the report said.
   Singapore, South Korea, Indonesia and China would be the most seriously affected, it said.
   The United States has been pressuring China and other Asian states to strengthen their currencies as a way to reduce the US deficit, which accounts for 6.5 per cent of GDP in the world’s biggest economy.

The US and EU trade chiefs were due to meet here this weekend under Brazilian auspices in a bid to bridge yawning differences on how to tear down global trade barriers before an April deadline.
   The major players at the World Trade Organisation are not any making grandiose claims for what the meeting Friday and Saturday can achieve.
   But all sides know that something has to give if the WTO is to achieve its goal of establishing the broad outlines of a global trade deal by the target date of April 30.
   WTO chief Pascal Lamy was to join the talks hosted by Brazilian Foreign Minister Celso Amorim along with European Union Trade Commissioner Peter Mandelson and US Trade Representative Rob Portman.
   Mandelson said in Buenos Aires Wednesday that the meeting, at a hotel overlooking the sun-and-sand delights of Copacabana beach, was not aimed at clinching any breakthroughs.
   Rather, he said, the meeting ‘will be an opportunity to understand the differences that exist among the key players to see how we could narrow the gap between us’.
   The 149 WTO members have already missed a series of deadlines to wrap up their ‘Doha Round’ of negotiations launched in the Qatari capital in 2001.
   A full ministerial meeting in Hong Kong at the end of last year produced only a loose framework for an accord and a new commitment to forge the main outlines by the end of April.
   A follow-up gathering of six of the biggest players in London in mid-March explored new data showing the potential gains from ambitious tariff cuts, but made scant progress otherwise.
   Developing countries led by big emerging markets such as Brazil and India insist the rich world, notably the European Union, must move first by dismantling generous agricultural subsidies.
   The European Union, backed to an extent by the United States, retorts that developing nations must in return grant much greater access to its industrial exports and service industries.
   The overall aim is to achieve a comprehensive agreement by the end of this year.
   That is one deadline that really cannot be missed, given that in the middle of next year, the US Congress will regain the right to pick apart any trade accord negotiated by the administration.
   In Rio this weekend, Portman hopes the parties ‘can build on their talks from London and move closer to establishing a framework in advance of the upcoming (April) deadline,’ the US trade chief’s spokeswoman told AFP.
   ‘Broadly, he is concerned with the lack of urgency by some as April 30 rapidly approaches,’ added the official, Christin Baker.

US software giant Microsoft says it hope it could yet avoid threatened EU fines linked to a landmark 2004 competition ruling, as last-ditch negotiations resumed in Brussels.
   The two-day talks are likely to be Microsoft’s last chance to prove it is complying with the European Commission before regulators slap a daily fine of up to two million euros ($2.4 million).
   ‘I think we had a very constructive dialogue yesterday,’ said Microsoft legal chief Brad Smith, after the first day of negotiations with the European Union’s executive arm on Thursday.
   ‘I only wish we could have had that kind of dialogue sooner but as we start the second day, I’m more optimistic than when I arrived that this type of constructive dialogue can in fact lead to a real solution,’ he added.
   The commission wants to force Microsoft to respect a March 2004 anti-trust ruling, in which the company was fined 497 million euros for abusing its dominant market position.
   Microsoft was ordered to sell a version of its widely-used Windows operating system unbundled from its Media Player software and to divulge information on its operating system needed by manufacturers of rival products.

US Commerce Secretary Carlos Gutierrez pressed Japan again on Friday to open up its market to US beef and the latest drugs—two longstanding trade disputes between the close political allies.
   Japan has repeatedly rejected US pressure to buy US beef, which was banned for a second time in January over fears of madcow disease.
   ‘We believe and we are absolutely convinced that our beef is safe,’ Gutierrez told a breakfast hosted by the American Chamber of Commerce in Japan.
   He noted that Americans were the world’s ‘largest beef consumers.’
   ‘We just want the opportunity to demonstrate that we can deliver the best beef in the world at the right specification (and) at the right standard as Japan requires,’ he said.
   Japan, once the biggest markets for US beef, ended a two-year embargo on imports in December after US members of Congress threatened trade sanctions.
   It then imposed a new ban just a month later when a beef shipment violated Japanese safety codes that require the removal of body parts at greater risk of the brain-wasting disease known as bovine spongiform encephalopathy (BSE).
   Agriculture Minister Shoichi Nakagawa on Friday rejected the new US pressure to open up the market.
   ‘I don’t think there is any timeframe for a resumption of US beef imports as we are supposed to implement step by
   step what we have to do, such as offering explanations to consumers and to the food safety panel,’ Nakagawa told reporters.
   He dismissed a recent press report that Japan wanted the issue resolved before Prime Minister Junichiro Koizumi visits the United States, likely in June, on his last trip there before stepping down in September.
   ‘I haven’t heard that the prime minister’s visit to the United States has been officially decided but there is no need to consider such a political schedule at all anyway,’ Nakagawa said.
   At the same time, he described two-day talks this week with US experts as a ‘step forward.’
   ‘The American side showed sincerity in trying to reply to us about why the problem occurred,’ he said.

The world’s tallest tower will be built in an underdeveloped eastern area in Tokyo in a bid to boost both television transmission and tourism, project leaders announced Friday.
   The 610-meter (2,000-foot) tall tower will dwarf landmarks in the capital’s upscale western parts, including the 333-meter-tall Tokyo Tower which has served as a symbol of Japan’s post-war miracle for half a century.
   It will host two observation decks, restaurants and office space at a former freight shunting yard along the Sumida river. It will be completed by July 2011 when Japanese broadcasters switch their ground transmissions to a full digital mode.
   ‘We will build a landscape transcending space and time,’ said Isamu Hachiki, executive director of Tobu Railway Co, a private rail firm which owns the tower site. Tobu will set up a venture to procure funds for the 50 billion-yen (425 million-dollar) tower which will be leased to public broadcaster NHK and five private networks.
   ‘It will enhance the value and brand awareness of areas along our railways and help reinvigorate Tokyo’s eastern side,’ he said. ‘Capital investment has been focused in the west.’
   The construction work is scheduled to begin in 2008 after two years of designing.
   ‘We need to build fun-filled tourist routes linked to the new tower,’ said Noboru Yamazaki, the mayor of Sumida ward which will host the tower.
   Sumida and other riverside neighborhoods have been home to traditional craftsmen and merchants and have been more detached from the capital’s rapid urbanization after World War II.
   The area is dotted with old historic sites and mostly antiquated commercial hubs such as the lively Asakusa area surrounding a popular Buddhist temple.
   The Sumida ward office estimated that the new landmark will draw more than three million tourists a year.
   Tentatively called New Tokyo Tower or Sumida Tower, it will top the world’s current tallest self-supporting tower, the 553-meter CN Tower in Canada’s Toronto.
   KTHI-TV Tower in North Dakota stands 629 meters high and there are a few other steel antennas of similar height in the world but they are all supported by cables.
   The world’s tallest structure will be the 800-meter-tall Burj Dubai, to be completed in the Gulf emirate in 2008. It will stand some 300 meters above the world’s current tallest floored building, Taipei 101 in Taiwan.

China’s rapid growth into the world’s manufacturing base poses no threat to the United States which must refocus on higher-end products, US Commerce Secretary Carlos Gutierrez said Friday.
   ‘At a time when China is growing as a manufac- turing exporter of low-priced goods, our unemployment is declining. And our eco- nomy is growing and the average take-home pay per American is increasing,’ Gutierrez said at a breakfast hosted by the American Chamber of Commerce in Japan.
   ‘China has built its economy on the basis of manufacturing of commodity-type products.
   ‘What we have seen in the US is that our new jobs that are being created are in the area of higher value manufacturing, differentiation of products, higher technology, and in many cases new services,’ he said.

The United States and Singapore agreed to launch talks to speed up tariff reductions under their two-year-old free trade pact.
   The decision was made during the second annual review of the US-Singapore Free Trade Agreement (FTA) in Washington, the US Trade Representative (USTR) office said in a statement.
   It said bilateral trade totalled nearly 37 billion dollars in 2005, up 12.6 per cent since the agreement came into force in 2004 as the first comprehensive US FTA with an Asian nation.

The race to set the industry standard for high-definition DVDs swept into Japan’s stores Friday as Toshiba put on sale its first next-generation player.
   Supporters of the HD DVD format pushed by Toshiba and NEC are vying with the rival Blu-ray format, led by Panasonic and Sony, in a replay of the VHS-Betamax battle between two types of video cassette tapes in the late 1970s.
   ‘We are heading into another format war,’ said Carlos Dimas, a consumer electronics analyst at CLSA Asia-Pacific Markets.
   In a low-key launch only confirmed on the day, Toshiba began selling its HD-XA1 high-definition player in Japan for 110,000 yen (850 dollars).
   Two different types of HD DVD players, which promise cinematic quality images and new possibilities in interactive entertainment, will also gradually hit the US market in April.

Australia’s corporate regulator has filed a federal court action accusing the local subsidiary of global investment giant Citigroup of insider trading.
   The Australian Securities and Investments Commission (ASIC) filed a civil suit alleging that Citigroup Global Markets Australia engaged in ‘unconscionable conduct’ while it was advising logistics firm Toll Holdings in a 4.6 billion dollar ($3.3 billion) takeover bid for ports operator Patrick.
   ASIC said Citigroup engaged in ‘substantial proprietary trading’ for its own benefit in Patrick Corp shares on August 19, 2005, the business day before Toll announced its hostile bid for the rival company.
   Citigroup, one of the world’s largest financial services conglomerates, strongly denied the charges and accused ASIC of trying to regulate the proprietary trading desks of major investment banks.
   In its court submission, ASIC alleged Citigroup did not have adequate arrangements in place to avoid conflicts of interest between itself and Toll.
   ‘ASIC alleges that Citigroup traded on inside information and directly against the interests of its client,’ said ASIC Deputy Chairman Jeremy Cooper.
   The regulator demanded that Citigroup admit it had violated conflict of interest and insider trading provisions of the Corporations Act and implement measures to prevent future breaches of the law.
   It also sought a restraining order preventing Citigroup from trading on its own account in shares linked to its clients and demanded it pay a fine of up to a million dollars.

Japan reports
rise in prices
Japan reported Friday a fourth straight rise in core consumer prices with a year-on-year gain of 0.5 per cent in February, stirring speculation about when interest rates will rise as deflation ends. The increase was slightly smaller than the 0.6 per cent gain the market had expected but nevertheless provided further evidence that the world’s number two economy is finally breaking free of its deflation doldrums.
— AFP

S’pore to
be REITS hub
Singapore could become a hub for up to 50 top-quality regional Real Estate Investment Trusts, the chief executive officer of state-linked investment company Temasek Holdings said Friday. Ho Ching was speaking at a ceremony to mark the first day of trading in the Ascott Residence Trust (ART), which she said is the world’s first serviced residence REIT. ART has an initial portfolio worth 856 million Singapore dollars ($528 million) of serviced apartment buildings which were bought from parent Ascott Group in Singapore, China, Indonesia, the Philippines and Vietnam.
— AFP

Chunghwa Telecom plans $815m capex
Chunghwa Telecom Co, Taiwan’s leading telecom operator, said Friday it plans 26.5 billion Taiwan dollars ($815 million) in 2006 capital expenditure eyeing the booming Internet and data service business. In 2005, the company’s Internet and data service business posted 42.2 billion dollars in sales, up 7.3 per cent from a year earlier. Chunghwa Telecom’s sales in 2005 rose 0.4 per cent from 2004 to 183.38 billion dollars. Chunghwa Telecom, the largest mobile phone operator on the island, last year assigned some 55 per cent of its 22.93 billion dollars in capex to the Internet and data service business.
— AFP