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A high-profile experts committee was formed Wednesday to deal with the proposed free trade agreement between Bangladesh and Pakistan.
   Additional commerce secretary of Bangladesh Elias Ahmed and joint commerce secretary of Pakistan Shahed Bashir will lead their respective teams in the committee that will hold the first meeting in May in Dhaka.
   Commerce ministers from Bangladesh and Pakistan formed the committee in a meeting at Sonargaon Hotel on Wednesday.
   ‘This was the first formal talks on the FTA and the meeting was very much fruitful,’ the
   commerce minister, Altaf Hossain Choudhury, told the reporters after the meeting.
   The Pakistan commerce minister, Humayun Akthar Khan, expressed his optimism to finish all the procedures regarding the proposed FTA within July.
   Replying to a query, Altaf Hossain Chowdhury said Bangladesh is eager to sign the FTA with Pakistan although both the countries already signed the SAFTA. ‘We’ll try to find out what else we can trade between the two countries,’ he said, explaining the eagerness of the country to sign FTA.
   The experts committee will identify the products and suggest the process to reduce the trade deficit between the two countries, the Minister said. The committee would also figure out the non-tariff and para-tariff barriers to the bilateral trade, he added.
   Explaining the reason behind the move for bilateral FTA, Pakistan Commerce Minister said they want to go beyond SATFA. ‘We want more.’
   Pakistan has already signed FTA with Sri Lanka and also simultaneously working to sign more FTAs with Malaysia, Indonesia and China.
   Bangladesh and Pakistan agreed to go for the FTA during Prime Minister Khaleda Zia’s visit to Pakistan last month.
   Pakistan has been showing increasing interest for the FTA with Bangladesh, although they openly opposed Bangladesh’s interest at the WTO ministerial conference in Hong Kong.
   Bangladesh suffered a trade deficit of $75 million with Pakistan in fiscal 2004-05 with Bangladesh’s exports totaling $63.12 million and imports amounting to $138.6 million. In 1996-97, the deficit was $28.49 million.
   Major Bangladesh exports to Pakistan included tea, raw jute, leather, pharmaceuticals, tobacco and coil assembly cigarettes while its major imports included textile and textile articles, machinery and mechanical appliances, electrical equipment and accessories thereof, products of chemical or allied industries and mineral products.
   As a measure to reduce the trade gap, Bangladesh requested Pakistan to grant duty-free access for 21 products of Bangladesh during the commerce minister level meeting held in Dhaka in January 2002.
   The Pakistani trade minister gave assurances to consider duty-free facility for jute, jute goods and tea initially, and extend similar benefit to other products of Bangladesh at a subsequent stage.
   During the visit of the Pakistani president to Dhaka in July 2002, Pakistan allowed duty-free access for tea and jute only.
   Since then Bangladesh has been pursuing the issue at different levels for duty-free market access of 10 products in the first phase.
   The issue was raised again during the bilateral consultation between foreign secretaries of the two countries held in Dhaka in May 2004 and during the 8th Bangladesh-Pakistan Joint Economic Commission meeting in Dhaka in September 2005.

Bangladesh Foreign Secretary Hemayetuddin Wednesday discussed the entire gamut of Dhaka-Beijing relations with Wu Dawei, Vice Foreign Minister of China.
   The Foreign Secretary arrived in Beijing Tuesday afternoon to hold the 8th Annual Foreign Office Consultations between the two countries.
   A foreign ministry press release here said the meeting, held in a frank and cordial atmosphere, reviewed progress in bilateral relations, especially in connection with implementation of the decisions taken and agreements signed last year.
   Both sides expressed satisfaction at the initiatives taken to operationalize the agreements in different sectors, including cooperation in agriculture, water resources and tourism as
   well as peaceful uses of nuclear energy, Chinese technical assistance, etc.
   The two sides identified and discussed a number of areas where the scope of bilateral cooperation can be deepened further through tangible, result-oriented actions.
   The Bangladesh side requested the Chinese government to consider special preferential measures to encourage greater import and promote increased flow of Chinese investment in manufacturing and service industries in Bangladesh.
   The Chinese side assured continued cooperation in reducing the trade gap between the two countries.
   The Chinese side also assured of remaining sensitive to Bangladesh’s concerns while negotiating loan agreement for various technical assistance projects.
   The two sides also exchanged views on issues of international and regional concerns.
   The Foreign Secretary briefed his Chinese counterpart about the progress in formulating the guidelines for observer status conferred on China and Japan in SAARC.

Bangladesh will receive Tk 717 crore equivalent to Euro 83.3 million from Germany in financial and technical assistance under an agreement inked between the countries on Wednesday.
   Out of the amount, Tk 126 crore is financial assistance. Besides, there is reprogrammed and transferable additional financial support of Tk 568 crore, said an official release.
   It said the commitment will be treated as grant and the scope of the utilization period of the fund is until 2013.
   Md Ismail Zabihullah, Secretary, Economic Relations Division, and Frank Meyke, Ambassador of Germany to Bangladesh, initialled the agreement on behalf of their respective governments.
   The agreement is designed to support Bangladesh in line with the Poverty Reduction Strategy Paper (PRSP) giving the priority to basic health, family planning and combating HIV/AIDS, economic reforms sectors, including development of rural markets roads in Dhaka, Rajshahi and Chittagong divisions and income generation and poverty alleviation.
   Since independence, Federal Republic of Germany has provided approximately Tk 19,780 crore equivalent to Euro 2.3 billion by way of direct bilateral assistance and a further amount of Tk 16,340 crore equivalent to Euro 1.9 billion.

Leaders of the Metropolitan Chamber of Commerce and Industry on Wednesday expressed their concerns to the prime minister over recent rise in rates of bank interest and government borrowings and erratic electricity supply costing the industries heavily.
   The prominent chamber urged the prime minister to withdraw tax concession for whitening black money, continue tax holiday facility and protect local industries from ‘blanket liberalisation of import,’ and remove duty distortions to help local industries survive.
   The chamber placed the demands while a delegation led by its president, Latifur Rahman, met the prime minister, Khaleda Zia, at her office Wednesday.
   The chamber termed ‘unfortunate’ the sudden rise in interest rates and tightened grip on credit at a time when the economy was peaking with about 6 per cent GPD growth, 8 per cent industrial growth and 19 per cent export increment.
   The chamber noted that interest rate in Bangladesh is now between 12 and 15 per cent while the rates are around 7 per cent in India, 5 in Pakistan and 2.7 in Sri Lanka.
   The interest rate on export credit ranges between 7 and 10 per cent in Bangladesh which is more than twice the rates prevailing in India and Pakistan, said the chamber.
   Pointing to imprudent government policy on checking inflation by contractionary policy, the chamber argued that historically, inflation had never been a monetary phenomenon alone.
   ‘Major factors which contributes to price increases are budget deficit, supply shocks, production losses decline in productivity, frequent increases in administered price of fuels and devaluation of currency and toll collection at supply routes,’ the chamber listed.
   It noted that till 13 April, the government’s budget deficit increased about 24 per cent to Tk 24,700 crore over the year against decline of 2.5 per cent in the same period previous year.
   ‘The government must immediately put limit on borrowing from banks,’ the chamber said, warning against the possible liquidity crisis looming large on state-run lenders and agencies.
   The chamber apprehended that the scheduled withdrawal of tax holiday by the end of this fiscal would jeopardise industrialisation.
   It sought the prime minister’s intervention on the tax holiday issue citing that not only India, Iran also provides industries with such scheme for 15 years, UAE 40 years while Egypt keeps the offer open for unlimited period.
   The MCCI urged for comprehensive measures to increases power generation saying electricity supply to industries around the city has become precarious with load shedding without prior information causing scaring losses of man hours and production.
   ‘We do not approve of blanket liberalisation because it may hurt local industry. Trade liberalisation does not mean that all import substitution industries have to be discouraged,’ it said.
   The chamber demanded that next budget should stop concession on whitening black money as the provision is not only an injustice to ethical tax payers but poses serious threat to country as black money is directly linked to criminal activities, smuggling of drugs, arms and ammunition.
   The prime minister, Khaleda Zia, assured the delegation of continued support to the private sector so that it can contribute to the national development.
   She said the government is business-friendly and attaches high priority to the development of private sector.

Chittagong Port faces a severe space crisis with growing number of containers blocking its yards for the past few weeks, port officials said.
   Besides, slow delivery of imported cargoes by a section of traders has deepened the crisis further, they said.
   Over 15,000 containers remained stockpiled at the port’s yards and sheds against the capacity to accommodate only 12,500 containers.
   ‘As a result, we are facing a tough situation in handling container cargo while the arrival of container ships also marked an increase recently,’ the Chittagong Port director (traffic), Ahsanul Kabir, said.
   Now on an average 50 container vessels call at Chittagong Port in recent months, up from an average of 30 container
   ships recorded three months ago, he added.
   Increased trading activities had led to the growth of container cargoes at the country’s prime seaport, he pointed out.
   For safety and security most of the importers and exporters now prefer shipment of cargoes through containers, the port official said.
    ‘Some traders want to use the port yards and sheds as warehouses of their cargoes and refrain from taking quick delivery. This is really a very bad practice,’ he said.
   The port authority has started issuing notices to those traders asking them to expedite delivery of containers. ‘Otherwise, we are bound to impose penalty,’ Ahsanul Kabir said.
   He hoped that handling facilities for container cargoes would increase after commissioning of  newly constructed New Mooring container terminal in a couple of months.

The Bangladesh Bank Governor, Salehuddin Ahmed, urged the commercial banks and other financial institutions to ensure access to finance of small and medium enterprises (SMEs) for generating more employment to propel the country out of poverty trap.
   ‘In a country like Bangladesh, creation of employment is more important and SMEs hold the potentials to generate job
   opportunities,’ he said at a roundtable at the Bangladesh Bank conference room on Wednesday.
   SME Cell of the Industries Ministry organised the roundtable on ‘SME Access to Finance’ with the chairman of SME advisory panel Abdul Muyeed Chowdhury in the chair.
   Deputy Governor of Bangladesh Bank Mohammad A Rumi Ali was the special guest at the roundtable, where senior bankers, businessmen and officials of the Industries Ministry were also present.
   Salehuddin said the process of access to finance should be quick. ‘If project preparation takes six months and sanctioning of loan another six months, then the SMEs could not afford the lengthy procedural system,’ he added.
   The central bank governor urged the banks and other financial institutions to provide the SMEs with financial support ‘not evaluating the balance sheet, rather evaluating the cash flow and income index.’
   ‘You may also evaluate four things—employment generation, profitability, market linkage and sustainability—before sanctioning loans to the SMEs,’ he said.
   Dr Salehuddin said the policy makers of the country are also concerned over the poor funding to the SMEs.
   There are 49 commercial banks and 28 other financial institutions in the country, he said, alleging that some of them do not respond to funding the SMEs.
   ‘Keeping your basic norms, please be open to feedback positively for funding the SMEs,’ the Bangladesh Bank governor urged the senior bankers who attended the discussion.
   He underscored the need for creating more employment opportunities to achieve the targets set in the Poverty Reduction Strategy Paper.
   Speaking on the occasion, Abdul Muyeed Chowdhury alleged that financing is not reaching the actual fund-hungry SMEs where it is most needed.
   ‘Trading sector enjoys preference from the banking sector in terms of getting financial support, but it should be changed,’ he said adding that the SME sector can contribute more than the trading sector in generating employment opportunities.
   Quantitative, qualitative and attitudinal change of the banks is needed to open a possible window to deal with the SMEs, he suggested.
   Citing an example, Muyeed Chowdhury said that an illiterate man of Galachipa in Patuakhali district has invented a type of torchlight having rechargeable batteries. ‘This type of invention needs financing.’

The chairman of Securities and Exchange Commission, Faruq Ahmed Siddiqi, on Wednesday said the SEC was waiting for the government’s approval to its key reform proposals seeking real teeth to ensure corporate practice and financial transparency and protect investors’ interests.
   The SEC chairman said this while inaugurating as chief guest a two-day training programme for authorised representatives of Chittagong Stock Exchange in the CSE conference room in the morning, a CSE press release said.
   The main features of the reform proposals include amendments to the 1969 ordinance, increasing the SEC’s autonomy and constituting a special bench of the High Court, Siddiqi told the function.
   The commission is also working on revising of the Company Law, establishing auditor’s oversight board, setting up a capital market institute and liquidation of delinquent companies, he added.
   The CSE president, AKM Mohiudin, presided over the function while Abbas Uddin Khan, FCA addressed the function as special guest.
   AB Siddique, chief executive officer of CSE, Nasiruddin Ahmed Chowdhury, first vice-president of CSE, AQI Chowdhury, vice-president, and Mirza Salman Ispahani, CSE director, among others, spoke at the function.
   The new SEC chairman said the market witnessed a significant improvement in corporate practices with a good number
   of listed companies defaulting on holding annual general meeting and submission of audited accounts going down gradually.
   The listed companies that failed to hold AGMs and furnish audited accounts numbered 41 and 38 respectively in January 2004, while 24 and 32 in January this year, he said.
   ‘We have brought many necessary changes in the regulation but there are other issues that should be addressed to have a sound capital market,’ Siddiqi said adding that the country’s capital market has achieved remarkable growth in the last couple of years.

Total turnover value at the Dhaka Stock Exchange rose to Tk 30.48 crore on Wednesday for the first time in last five months. The stock market indicator failed to touch even the thirty crore mark since December 4, 2005.
   Stock prices at the DSE went up on Wednesday for three consecutive days.
   DSE general index gained 4.76 points or 0.35 per cent to close at 1373.74. DSE20, comprising blue chips, went up by 11.30 points or 0.84 per cent to close at 1358.98.
   Around 1.98 million shares and debentures worth Tk 30.48 crore were traded at the bourse on Wednesday.
   Market people said the meeting of the Securities and Exchange Commission with the institutional investors and the amendment of the merchant banking rules allowing the merchant banks to manage own portfolio started to put positive impact on the stock market.
   They said the stock market on Wednesday witnessed institutional buying.
   The increased demand for the shares from the institutional investors also inspired the general investors, they said.
   In Tuesday’s meeting, the SEC asked the institutional investors to play proactive role for restoring the confidence of the small investors who are selling shares panicked by the recent downfall of the stock prices.

The Asian Development Bank said Wednesday the volume of its operations in 2005 increased by 30 per cent from the previous year to $7.4 billion.
   The bank cited its Annual Report 2005, expected to be released at its 39th Annual Meeting scheduled for May 3 to 6 in Hyderabad, India, as saying that 5.8 billion US dollars of loans and grants were approved for 64 projects in 2005, with lending making up 78 per cent of total operations.
   Grants approved sharply increased from $104.4 million in 2004 to 1.2 billion in 2005, with almost half the amount from the Asian Tsunami Fund and another $80 million from the Pakistan Earthquake Fund, said ADB.

New rules giving Chinese insurers better access to investment abroad may mean a chance for higher returns after years of being forced to put their money in low-yield products, analysts said.
   The central bank regulations allow them to convert a portion of their 200 billion dollars in assets into foreign currencies for investment in bonds and other fixed-income products in overseas markets.
   ‘It is definitely good news for them, and at least they will have more options than just putting the money on deposit,’ said Chen Xingdong, the Beijing-based chief China economist with BNP Paribas Peregrine.
   It may also be significant news for overseas markets, as Chinese insurers have more than quadrupled their assets in the past five years to 1.6 trillion yuan (200 billion dollars).
   This means even an opening that in per centage terms may seem limited could mean a fairly sizable injection of Chinese funds into foreign markets.
   Deutsche Bank said it expected regulators to allow up to five per cent of insurers’ yuan assets to be converted into foreign currencies for overseas investment, of which 15 per cent could be allocated to overseas listed equities.
   It forecast total insurance funds available from the yuan conversion scheme to rise from 2.2 billion dollars in 2006 to around 5.4 billion dollars in 2010.
   China’s strict regulations on investment have so far made insurers’ investment a rather dull affair.
   At the moment, the typical investment portfolio of a Chinese insurer consists of 50 to 60 per cent bonds, 30 to 40 per cent deposits and five per cent equities, Deutsche Bank said.
   This is in sharp contrast to insurers in mature foreign markets that usually allocate 60 to 70 per cent to bonds and more than 30 per cent to equities and alternative investments, it said.
   For foreign currency investments, the options are so limited that 99.9 per cent of the insurers’ foreign exchange assets are in the forms of bank deposits, according to Deutsche Bank.
   The consequence has been returns on investment that last year reached just 3.6 per cent for the Chinese insurance industry as a whole, according to state media.
   The decision to allow insurers to invest in fixed-income and money market products is likely to see insurers investing in foreign bonds, such as US Treasuries, which offer higher yields and longer durations.
   ‘A lot of insurance companies will be choosing to invest in foreign bonds, especially in the US and also Europe,’ said Karen Chan, an analyst with Nomura International Securities in Hong Kong.
   ‘Investing abroad allows them to lengthen the duration of the asset and also the yields of foreign bonds are usually higher than Chinese bonds.’
   Despite all the advantages, insurance companies are seen unlikely to invest too aggressively in overseas fixed-income products because of exchange-rate risks.
   ‘For Chinese insurance companies, in the long run the decision is positive, but one of the challenges they will need to look at is how to do currency hedging,’ she said.
   China’s insurance regulator, the China Insurance Regulatory Commission, has gradually eased investment restrictions over the last two years.
   In September last year it announced new rules allowing insurers to invest foreign currency holdings in Chinese companies listed offshore, but they could only invest up to a maximum of 10 per cent of their foreign denominated assets.
   It is not yet clear what per centage of yuan holdings an insurance company will be able convert into foreign currency for investment.
   ‘The new regulations only stand for an opening,’ said Guo Jinlong, director of the Chinese Academy of Social Sciences’ insurance division.

In the famed tourist centre of Nepal’s capital, Western Buddhist monks rub shoulders with mountaineers, dreadlocked travellers, street urchins and marijuana peddlers.
   Thamel is not the kind of place usually associated with pro- democracy movements, but the political upheaval that has shaken Nepal for the last two weeks has now spread to this peculiar corner of the troubled country.
   Nine foreign tourists were briefly detained last week by riot police after breaking a ban on public meetings. Since then hundreds of hotel and restaurant workers have poured out into the narrow alleys that once drew hippies from around the world to protest against King Gyanendra.
   Nepal enters its third week of mass protests on Thursday and embassies have been issuing travel warnings urging their citizens to stay away.
   Last year around 270,000 visitors arrived by air, compared to the ‘golden year’ of 1999 before the Maoist insurgency intensified when nearly 500,000 people visited the Himalayan nation of ancient temples and stunning trekking and mountaineering.
   Johannis Jappen, a German tourist and frequent Nepal visitor, has been organizing tourist protests. He was one of the nine arrested last week.
   ‘The police were very polite and kind and we were released four-and-a-half hours after being detained,’ said Jappen. ‘They were very apologetic.’
   He tried to organize another protest Tuesday, but this time only a handful of tourists braved the rain and lurking police.
   ‘I saw how many people were coming into the streets to be a part of the movement and I thought that as tourists we should do our bit as well,’ Jappen said.
   With lanes full of shops selling trekking gear, hippy clothing, traditional kukri knives and pirated CDs and DVDs, the Thamel neighbourhood has a totally different feel to the more traditional old areas that surround it.
   In the past, protesters have kept away from Thamel, aware that tourism is a vital mainstay to Nepal’s fragile economy, but not anymore.
   All it takes is a whisper of rumour that protesters are on the way, and shops quickly pull down their shutters, leaving bemused tourists wondering what is happening.

Pakistan government Tuesday allowed import of corrugated sheets from India till September this year through the land route, for the exclusive use in the reconstruction work in its earthquake-affected areas.
   An amendment made in the Import Policy Order, 2005 in this regard, however, declared that the recommendations of Earthquake Reconstruction and Rehabilitation Authority would be pre- requisite for the import of the product.
   ‘In exercise of the powers conferred, the federal government is pleased to direct that the following further amendment shall be made in the Import Policy Order, 2005.
   ‘Provided further that the corrugated galvanized iron sheets SWG 26/24 falling under their respective headings shall be importable from India up to the September 30, 2006, via land route as well, for exclusive use in the reconstruction of earthquake-affected areas on the recommendations of Earthquake Reconstruction and Rehabilitation Authority (ERRA),’ an order issued by the Commerce Ministry here said,
   The order can be a big boost for the Indian corrugated sheet and its ancillary industry as Pakistan is expected to import them in large quantities.
   ERRA was also expected to use much of the $25 million committed by the Indian government for reconstruction of the earthquake-hit areas, which was linked to procurements of materials from the Indian market.

Fuel prices began rising sharply in Taiwan on Wednesday after the government halved import tariffs on gasoline and state run Chinese Petroleum Corp (CPC) announced a substantial fuel hike.
   CPC said it would raise domestic fuel prices by 8.63-9.94 per cent to reflect rising crude import costs, effective immediately after oil prices struck a record close in New York trade overnight.
   The increases covered gasoline (petrol), diesel, industrial fuel, and liquified petroleum gas and was the company’s second hike in fuel prices this year after 3.83-4.97 per cent increases in February.
   CPC controls 75 per cent of Taiwan’s petroleum market with the rest going to Formosa Petrochemical Corp which separately said it will raise gasoline and diesel prices by 8.22-10.19 per cent from Thursday.
   The cabinet Wednesday earlier said it has halved import tariffs on gasoline to 5.0 per cent to help stabilize domestic consumer prices following fuel price hikes.

Claiming the economy was doing well, President Pervez Musharraf has invited potential investors to Pakistan asking them to reap the benefits of liberalisation and cheap labour.
   “Privatization, deregulations and liberalization economic policies pursued by the government have given a big boost to our economic growth,” Musharraf said at a reception hosted by American Business Council (ABC) here.
   “The wheel of economic activities in the country is moving faster which is evident from the fact that today hotel occupancy rate in Karachi and Lahore was more than 100 percent. By creating an investment-friendly environment, we are encouraging investors for maximum investment in Pakistan,” the President was quoted by APP as saying.
   He said that there was “no dearth of skilled, qualified and cheap labour” in the country.
   Noting that the direction taken by Pakistani economy was “good” with exports and FDI increasing and unemployment and poverty decreasing, Musharraf said, “we have achieved a record 8.4 per cent economic growth last year and every effort will be made to sustain this growth in future.”
   FDI has recorded an upsurge of 3 billion dollars this year, he said adding the boost in economic activities will help in generating job opportunities, reduction in unemployment and poverty elevation.
   The President said that policies of privatization are successfully moving ahead and so far government had earned Rs 150 billion.
   Pakistan’s per capital income has increased from USD 435 to USD 800 per person which shows the sign of growth in the country’s economy, he added.
   Karachi, Apr 19 (BSS/PTI) Claiming the economy was doing well, President Pervez Musharraf has invited potential investors to Pakistan asking them to reap the benefits of liberalisation and cheap labour.

The Federal Reserve has pushed interest rates “close to a neutral stance” with 15 quarter-point rate increases, San Francisco Fed chief Janet Yellen said Tuesday.
   Yellen’s remarks to a California business group were among the latest suggesting the US central bank is near the end of its cycle of rate increases that began in 2004, although she said the outlook has “a lot of uncertainties.”
   “Although inflation is in the upper portion of my comfort zone, it appears to be well-contained at present, and my best guess for the future is that it will remain well-contained,” she said in remarks released by the Fed.
   “Moreover, this desirable trajectory appears to be within reach at a time when the Fed’s key policy interest rate—the federal funds rate—is close to a neutral stance, one that neither stimulates the economy nor restrains it.”
   The Fed has pushed its base rate up to 4.75 percent with the latest of its 15 rate hikes, coming out of a period of stimulating the economy that saw the federal funds rate drop to 1.0 percent.
   Yellen said Fed rate hikes should damp the pace of economic activity, which she said had “roared back” in the first quarter. She reiterated that future decisions on interest rates remain data-dependent.
   “Before I seem to make this picture too rosy-looking, I want to remind you that there are lot of uncertainties on both the upside and the downside,” she said.

‘Ebaar Thanda aar Fanda Aki Shathe’ was the brand message from Chocolate Horlicks which has nutritional elements that add more value to the health conscious family. With this head line, Cold Chocolate Horlicks drink was served to the consumer on the occasion of celebrating 3-day long Pahela Baishakh activity at Fantasy Kingdom.
   In a simple preparation method of a glassful of milk, add 2 spoonfuls of Chocolate Horlicks and add sugar to your taste and ice cube. Chocolate Horlicks bottle is available in the market in 500 gm SKU.

The 149 nations in the World Trade Organisation are under mounting pressure to reach a deal to drive forward the Doha Round talks on liberalising global commerce, but a compromise still appears out of reach.
   Uncertainty surrounds an April 30 target for an accord on cutting tariffs on industrial and agricultural goods, as well as slashing subsidies paid to farmers in rich nations which critics say undermine competitors in the developing world.
   The lack of progress means that the WTO has still not decided whether to hold a meeting of trade ministers at the end of this month to cap weeks of talks among specialised negotiators.
   The spotlight remains on trade diplomats in Geneva this week who are attempting to break the deadlock which pits the rich, notably the European Union and United States, against developing country powerhouses including Brazil and India.
   ‘Everthing depends on the discussions in the next three days. If we are recording significant convergence on the 21st, I expect (WTO Director General Pascal Lamy) to decide to have this ministerial meeting or not,’ Ujal Singh Bhatia, India’s trade ambassador, told AFP.
   The April 30 deadline was part of a loose agreement at a WTO conference last December in Hong Kong.
   At the conference, governments tried to bring some momentum back to the struggling Doha Round of negotiations, which was launched in 2001 with the aim of tearing down barriers to commerce and using trade to boost the economies of poor nations.
   WTO members have missed several previous deadlines: the Doha Round was originally meant to end in 2004.
   This month’s target is part of a drive to complete the round by the end of the year, before Washington loses its special negotiating powers in 2007 and the US Congress gets back the power to pick apart any deal, potentially complicating future talks.
   In Hong Kong, governments agreed that they would reach a deal on ‘modalities’—WTO jargon for formulas and other guidelines for reducing trade barriers.
   Despite some steps forward, governments and their negotiators have been unable to agree on the mathematics for the highly technical and politically charged formulas.
   In the WTO agriculture talks, the EU and US have been under pressure from developing countries led by Brazil and India, as well as rich farm exporters including Australia, Canada and New Zealand, to make more concessions on tariffs.
   The EU and US, as well as other rich WTO members, are seeking more access to developing world markets for their industrial goods and services such as banking.
   Some developing countries are also pushing for freer trade in services: New Delhi is pressing for Indian information technology experts to be able to do business easily in person in rich countries.
   Other poor nations, particularly former European colonies with preferential trade deals with the EU, are worried about losing out on a more level playing field.
   ‘Everything is on the table now, but in agriculture the complexity of the issues which still remain to be resolved is immense,’ said Bhatia.
   ‘Depending on how much ambition there is in the developed countries’ market access we will then discuss developing countries’ contribution.’
   Brazilian Foreign Minister Celso Amorim recently said that he was pessimistic about the April 30 deadline.
   ‘Without a strong gesture soon, I don’t see anything at present which would enable an agreement,’ he said last week.
   On Tuesday EU Trade Commissioner Peter Mandelson said that a ‘dose of realism’ was needed in the talks.
   ‘I would like to say that we are going to meet our deadline ... but I fear it will be very difficult because the differences are still too wide,’ he said in an interview published in the Financial Times.

The world’s software leader Microsoft impressed China’s president Hu Jintao Tuesday with a tour of its most advanced technological innovations, including the ‘Home of the Future.’
   Comfortably furnished, the facility in Microsoft’s Redmond Campus just outside Seattle is a model of the type of high-tech home the company envisions will be used in five to 10 years.
   Stepping into the living room, Hu was shown a screen which displayed digital photos of a typical family. With the movement of a Chinese vase, the photos changed to ones of places where Hu had lived or worked, including Beijing and Tibet as well as his alma mater Tsinghua University.
   Forget photo albums.
   ‘He’s very interested in the introduction and briefing by Microsoft people,’ said Hong Lei, director of information in the Chinese foreign ministry’s North America division.
   So ‘fascinated’ by what he was shown, the tour took about 15 minutes longer than expected, said Lou Gellos, a Microsoft spokesman.
   ‘He asked questions at every stage of the demonstration,’ Gellos told reporters later.
   One of the stops that interested Hu was the kitchen, where if Hu’s wife Liu Yongqing, who accompanied him on the tour, took out a sack of flour from the cupboard, the computer system in the home would immediately beam down suggestions of recipes she could make on the kitchen counter.
   And the smart kitchen would remind the Hu household if the flour is used up and not put back in the cupboard to buy another bag on their next shopping trip, not that China’s first family would need to cook or do their own shopping.
   Never mind that this could put out of work large numbers of migrant women who work as maids in middle-class or rich Chinese families’ homes.

ASEAN should work with China and India to persuade army-ruled Myanmar to reform since the regional powerhouses have stronger economic leverage, the bloc’s chief Ong Keng Yong said Wednesday.
   Ong said there was ‘certain impatience’ among members of the Association of Southeast Asian Nations with Myanmar’s foot-dragging on democracy but the grouping had limited leverage to pressure the junta.
   ‘Most of ASEAN believe that Myanmar authorities can only move forward if you have certain leverage applied on them,’ Ong told reporters as ASEAN foreign ministers began arriving on Indonesia’s Bali island before an informal retreat Thursday.
   ‘The best way is to work with our neighbors who have better leverage with Myanmar. China and India have common borders with Myanmar,’ he said.
   ‘They are also very involved in cross-border trade, in investment, in tourism and in other things,’ he added.
   Myanmar is expected to be a key agenda item at the retreat in the cultural hill town of Ubud.
   Ong chided the two regional giants late last month, saying ASEAN should ask them to be more persuasive towards Myanmar and there was little point in them being ASEAN’s dialogue partners if they were not contributing on the issue.
   Singapore’s Foreign Minister George Yeo also said last month that China’s and India’s open policy on Myanmar diluted the impact of Western sanctions.
   China is Myanmar’s staunchest international ally and a major trading partner.
   Ong also said ASEAN was disappointed that Malaysia’s Foreign Minister Syed Hamid Albar was unable to meet detained opposition leader Aung San Suu Kyi and junta leader Than Shwe when he visited Yangon last month.
   ‘There is a certain impatience because the people around the region as well as around the world say, You keep talking, you keep going there—and then what happened?’ he said.
   ‘People want to see some concrete steps forward.’
   Syed Hamid is due to brief the ministers about his Myanmar trip at a working dinner later Wednesday. His Myanmar counterpart Nyan Win is also to give a rundown on the visit.
   Myanmar agreed at last year’s ASEAN summit to invite Syed Hamid in the face of growing international pressure for evidence of democratic progress by Yangon, as well as embarrassment among some members over its inclusion in the bloc.

Australia’s economic activity was likely to remain below trend for most of the year and there was no convincing case for an imminent rise in interest rates, a survey said Wednesday.
   The Westpac-Melbourne Institute leading index, which predicts the likely pace of economic activity in the coming six to nine months, found that annualised growth was 3.5 per cent in February, below its long-term trend of 3.7 per cent.
   The February figure was an increase of 0.2 per cent on the previous month but well down on December’s annualised growth rate of 4.5 per cent.
   ‘Growth is now below trend, as it was for most of 2005,’ said Westpac’s global head of economics Bill Evans.
   ‘The leading index is not pointing to a strong recovery in Australia’s growth rate. It is indicating that growth is likely to hold below trend for most of 2006.’
   Evans said there was no convincing case for a hike in interest rates by the Reserve Bank of Australia (RBA) at present, adding that markets expecting a 0.25 per cent increase had over-reacted to recent strong data.
   ‘The leading index is signalling that this strong run of data may not be sustained. The RBA is likely to take a prudent approach to policy by waiting to further test the sustainability of the recent strong data,’ Evans said.
   ‘Westpac expect that rates will remain on hold following the May RBA board meeting’.
   The central bank last lifted its official cash rate, now 5.50 per cent, in March 2005.
   Evans said there would be a continuing solid contribution to growth from business investment and exports but that residential building would remain a drag on growth for most of the year.

India’s third-largest software exporter, Wipro, said Wednesday annual net profit climbed 26.9 per cent as revenues crossed the two-billion-dollar mark in a booming outsourcing market.
   Net profit of the New York Stock Exchange-listed firm jumped to 20.7 billion rupees ($460 million) for the financial year to March 2006 from the previous year’s 16.3 billion rupees.
   Revenues at Wipro Ltd, whose clients include General Motors and Microsoft, rose 30 per cent to 106.26 billion rupees, according to Indian accounting rules.
   During the fourth quarter, net profit rose 43 per cent to 6.1 billion rupees from a year earlier on revenues that climbed 35 per cent to 31.1 billion rupees, beating market expectations.
   ‘We look forward to 2006-07 and beyond with excitement and enthusiasm,’ Premji told a news conference in the high-tech southern city of Bangalore where Wipro has its headquarters.
   ‘Looking ahead for the quarter ending June 2006 we expect revenues from our global IT business to be approximately 533 million dollars.’
   Wipro’s revenue growth for the next five years should outstrip the industry average of 25 per cent annual growth projected by India’s top software body, the National Association of Software and Services Companies, Premji said.
   ‘Wipro’s businesses are all in the sweet spot of strong growth. We continue to see a mix of acquisitions as we move forward,’ Premji said.
   Shares of Wipro, which also has interests in computer hardware, were up 9.3 rupees or 1.63 per cent at 579.4 rupees in early afternoon, outpacing the overall market which gained 1.32 per cent or 155.7 points to 11,977.35.
   The software developer, 84-per cent owned by India’s wealthiest tycoon Azim Premji, said it added 42 clients in the fourth quarter ending March.
   ‘The information technology services industry is evolving from an era of routine service provisioning to one of innovative knowledge creation,’ Premji said.
   ‘The strategic initiatives we propose to undertake as part of our plan over the next few years position us well to lead this evolution,’ Premji said.
   ‘Europe as a region is registering strong growth as more firms from Germany and Scandinavian countries are getting interested in global outsourcing.’
   Dipen Shah, analyst at brokerage Kotak Securities said, ‘the broad set of numbers look good’ and ‘the guidance for the 2007 first quarter is impressive.’
   The company’s results followed earnings from first-place Tata Consultancy Services and second-ranked Infosys that also pleased markets.
   Wipro consists of Wipro Technologies, the global IT business arm; Wipro Infotech, comprising its businesses in India, the Middle East and the Asia Pacific region; and Wipro Consumer and Lighting.

The US government and the five-member Southern African Customs Union (SACU) have failed to reach consensus regarding the establishment of a free trade agreement following a one-day meeting in Pretoria Tuesday.
   Although the parties have agreed to set up a framework for future negotiations, analysts warned that should the United States fail to backtrack on some of its conditions, the deal will remain a far fetched dream.
   Unrealistic demands by the US government were said to be at the center of the failed talks, said a report of the South African Broadcasting Corporation (SABC).
   The US government has mandated Karan Bhatia, its deputy trade commissioner, to ensure that the deal must include intellectual property rights, government procurement rights and investment.
   But the US government’s announcement that it is not going to compromise on any of the three identified areas of
   trade ‘appears to be a hurdle too high to jump for SACU,’ SABC said.
   SACU, which consists of South Africa, Namibia, Lesotho, Botswana and Swaziland, has not done much trading in these areas, which was regarded as a major challenge by the US trade envoy.
   Washington began formal talks with South Africa and four neighbors on a trade agreement in 2003 but little progress has been made.

President Gloria Arroyo announced plans Wedensday to promote increased use of ethanol and other fuel alternatives to help the oil-poor Philippines survive record-high oil prices.
   Arroyo has ordered the energy department to encourage the setting up of more production facilities for a diesel mix that includes a coconut oil by-product that can be used in vehicles, a presidential palace statement said.
   State-run Philippine National Oil Co. is to enter into a joint venture with the armed forces to plant jephropha, a plant that can be a good source of ‘bio-diesel’, it added.
   Arroyo also wants to promote liquefied petroleum gas as a substitute for gasoline or conventional diesel as fuel for cars, particularly taxicabs and bus fleets.

TUI, Europe’s leading travel and tourism group, is to cut around 2,000 jobs at its recently acquired Canadian shipping firm, CP Ships, the head of TUI’s Hapag Lloyd shipping division, Michael Behrendt said on Wednesday.
   Behrendt told a news conference in Hamburg that Hapag Lloyd would take on around 3,000 of CP Ships’ 5,000-strong workforce.
   The remaining 2,000 jobs would be cut at around 200 sites worldwide, Behrendt continued.
   Hapag Lloyd itself employs around 4,000 people, so that once CP Ships had been fully integrated in 2008, it would have a total workforce of 7,000.
   All of 200-strong German workforce at CP Ships would keep their jobs.

South Korea’s top auto company, Hyundai Motor, issued a public apology Wednesday and offered to donate shares worth one billion dollars to charity to make amends for a widening corruption scandal.
   ‘The Hyundai Motor group, which should have set an example for society, failed to meet its social obligations and caused concern to the people.
   We bow to the people and apologize,’ the company said in a statement.
   After returning home from China, Hyundai Motor chairman Chung Mong-Koo said more than 30 times ‘I feel sorry’ to reporters waiting at the airport.
   Hyundai Motor said the chairman and his son, Chung Eui-Sun, president of affiliate Kia Motors, would donate to charity their 60-per cent holding worth one billion dollars in Glovis, a Hyundai unit.

World oil prices dipped on Wednesday but remained within sight of record high points struck the previous day on fears of a US military strike against Iran over its nuclear program.
   Market concerns also persisted over tightening US gasoline supplies ahead of the US Department of Energy's weekly snapshot of energy stockpiles, which is published later in the day.
   Dealers warned that prices could head higher after crude futures hit intra-day peaks on Tuesday of 71.60 dollars in New York and 72.64 dollars in London, owing to heightened tensions over Iran's nuclear ambitions.
   In Wednesday trading, New York's main contract, light sweet crude for delivery in May, dropped 35 cents to 71.00 dollars per barrel, after notching up a record close of 71.35 dollars on Tuesday.
   In London on Wednesday, the price of Brent North Sea crude for June delivery slid 15 cents to 72.36 dollars per barrel in electronic dealing.
   'This market is ready to blow,' said Tony Nunan, an energy risk manager with Mitsubishi Corp's international petroleum business in Tokyo.
   'It's still way above 70 dollars. Gasoline and geo-political risks are driving the market and they both do not have easy solutions.
   'There is so much uncertainty with Iran and the real problem for the market is that Iran's real main weapon is oil and when push comes to shove they will do something about it,' Nunan said.
   Security analysts say that in case of a conflict, Iran could block the Strait of Hormuz, a strategic choke-point for oil exports to Japan, the United States and Western Europe.

Coca-Cola Q1
profit rises
Coca-Cola Co, the world’s biggest soft-drink maker, on Wednesday reported a rise in first-quarter profit helped by strong volume growth. The Atlanta-based company, which rolled out a flurry of new products last year and has kept up the tempo in 2006, reported first-quarter earnings of $1.1 billion, or 47 cents a share, from $1 billion, or 42 cents a share, a year earlier.Analysts on average forecast earnings of 48 cents a share, according to Reuters Estimates.
— Reuters

Samsung, Sony inject money into LCD expansion
High-tech giants, Samsung Electronics of South Korea and Japan’s Sony agreed Wednesday to boost the production of liquid crystal display (LCD) panels at a joint venture. Samsung Electronics said the joint venture, S-LCD, in South Korea would invest 222 billion won (233 million dollars) to increase monthly production at its existing plant to up to 90,000 panels.
— AFP

Kia Motors president to be called for probe
South Korea will summon the president of Kia Motors Corp. (000270.KS) for questioning over an investigation involving the Hyundai Motor group, a spokesman for the Supreme Prosecutors’ Office said on Wednesday. ‘Chung Eui-sun will be summoned tomorrow morning at 9:30.’
— Reuters

Nissan sees parent profit jump
Nissan Motor Co on Wednesday estimated its parent-only net profit jumped 135 per cent in the business year ended last month to account for the receipt of funds from its US unit to pay out a promised dividend of 29 yen a share.
— Reuters