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Three years into the introduction of floating exchange rate, taka depreciated by 17.3 per cent against the US dollar through devaluation and revaluation during the period.
   The greenback was traded at Tk 57.90 at the end of May 2003 when Bangladesh Bank decided to end its currency peg regime and introduce market-based exchange rate.
   Weighted average value of a dollar stood at Tk 69.99 on Wednesday as the rate of dollar has been determined on day-to-day basis in the inter-bank foreign exchange market since June 2003.
   Calculation shows that taka lossed value by 17.3 per cent these three years as the local currency witnessed a massive erosion in value during the last one year, preceded by a moderate depreciation over the past two years since the exchange rate was full-floated.
   But depreciation was not continuous as revaluation sometimes broke the losing streak during the three years of the floating exchange rate regime, giving an indication of some sort of adaptation and maturity in the functioning of the market forces.
   Central bank, dealer banks and analysts, however, felt that movement of exchange rate in Bangladesh is yet to be properly market-oriented due to several reasons.
   ‘Market fundamentals have already started to work and behaviours of the market players started to be market-sensitive,’ said a senior official of the Bangladesh Bank.
   ‘We have seen some seesaw movements in the market, where some banks did not behave rationally and few others failed to manage their funds properly,’ he added.
   Fund managers in different banks observed that prices of currencies particularly US dollar are still not market-sensitive as there prevails a wide gap between rates quoted by nationalised, private and foreign banks.
   They, however, added that banks are now more cautious on fund management and paying more attention on higher inflow of foreign exchange.
   ‘Unlike in pre-floating rate regime when central bank usually sold dollars to the banks, banks now have to depend on market for foreign currencies,’ said a fund manager of a private commercial bank.
   He also said that during the period, dominance of nationalised commercial banks as major suppliers of dollar has been reduced significantly and some private banks emerged as influential players in the currency market.
   ‘Central bank intervention, though relaxed, is still there and current floating is indeed a managed one,’ he noted, but said that market maturity is rising slowly.
   Ananya Raihan, an independent analyst, said that the depreciation of taka against dollar is moderate in the period and mostly in line with global trend.
   He was of the view that the central bank still utilises its mechanism to artificially control the exchange rate.
   ‘The most important thing is to intervene in the market when it is required, but not by keeping the exchange rate artificially lower,’ he added.
   Ananya, also the executive director of research organisation D.Net, said that market has started to be pro-active and it is important to improve the dealing room mechanism and treasury management by the banks to avoid any setback.

Mobilisation and utilisation of resources are among the major challenges for the country’s economy, which is still growing at a slower rate than in India and Pakistan, a senior economist says, countering the claim of and complacence over higher growth rate.
   Energy should be given top priority to accelerate the growth further to generate employment, which is crucial for poverty reduction, says Qazi Kholiquzzaman Ahmad, as he gave his thoughts frankly on key economic issues and budgetary measures in an exclusive interview with New Age recently.
   The president of the Bangladesh Economic Association explicated the current challenges of economy, poverty reduction strategy paper and fiscal measures to address economic problems.
   Here are the excerpts of the interview.
   What are the challenges the economy faces currently?
   The major challenge of the economy at the moment is resource mobilisation and utilisation in general. The revenue-GDP ratio is still 10.5 per cent which is below the regional level. With low revenue, we cannot even utilise all our available resources properly due to corruption and inefficiency. During July-March period of current fiscal year, some 45 per cent resources allocated to the annual development programme has been utilised. So, in the last quarter, additional 20 per cent resources will be utilised. But keeping election in mind, the government will rush for quick disposal, creating scope for waste of resources.
   How can these issues be addressed through the next budgetary steps?
   For the upcoming budget, top priority should be given on energy. You can’t expect development and production without strong support of infrastructure, and for this the smooth supply of energy is essential. Over the past four years, virtually there has been no addition to the electricity production and no balancing and modernisation of the existing generating plants. The situation is particularly bad in rural areas and small towns. As Bangladesh doesn’t yet have any comprehensive long-term energy policy, the budget should provide policy support to overcome the energy crisis. We should also explore alternative energy sources and for this the budgetary support should be there in both public and private investments.
   Water is another area of concern that is largely ignored by the policy makers. The south-east region of Bangladesh, constituting one-third of the country, is critically water-short during dry season. Pure drinking water is a serious problem in many parts of the country including Dhaka. Water management issue should be emphasised in the budget.
   What is your observation on our GDP growth?
   There are lot of talks on growth and the finance minister will again proclaim the 6 plus GDP growth as a major success of the government. But compared to our neighbouring countries, we are still far behind. India has succeeded in raising its GDP growth rate per annum to 8 per cent or more and so has Pakistan. Both these countries expect to maintain such high growth rates in coming years. But Bangladesh is not ready to accelerate growth rate to 8 per cent as we are still suffering from energy crisis, foreign exchange shortages, human capability limitation, water crisis and others.
   As the country is now going thorough the regime of PRSP, is there any positive impact on the economy or poverty reduction?
   It is critical to review the budgetary progress in line with the PRSP. Now employment is the key to reduction of poverty and the PRSP has clearly acknowledged this on top of the eight points. In Bangladesh, a huge number of people are now under-employed, which aggravates the overall unemployment situation. The PRSP stresses on the preparation of a strategic vision for private sector development and broad-based development of small and medium enterprises. But we haven’t seen any strategic vision so far. Policy support to SME is still insufficient. The timely disbursement of funds, some compensation packages to face the stiff competition from the imported products are important for SMEs.
   Is the development of social sectors needed for poverty reduction?
   Education and health are two major social sectors which require development for poverty reduction. Our per capita health expenditure is $12 against the WHO’s minimum level of $25. Lack of quality education becomes more acute. The industrial and business houses suffer from shortages of skilled management personal and operators.
   Is the widening income gap between the rich and the poor a matter of concern?
   The widening income gap is a major challenge for poverty reduction and narrowing down the gap is crucial. The per capita income of the top five per cent of the population was 18 times that of the bottom five per cent in 1991-92, which rose to 27 times in 1995-96, 46 times in 2000 and 84 times in 2005. The rate of growth of disparity has obviously been increasing over time, particularly since 2000. A continuation of this process is a sure recipe for social destabilisation, even disintegration.
   What are the areas budgetary spending should emphasise more and in what areas the government expenditure should be cut down?
   Budget has to be prepared on the basis of reality, not on the political consideration. It will be very unwise if government fails to maintain continuity of the budget and economic management, and the caretaker government will be in trouble. Problems like energy crisis and other may even become more serious by the time the next caretaker government is expected to take office, if the present government doesn’t address these now.
   Unproductive public expenditures should be cut down. Imports of luxury BMW cars and other products should be restricted.

Day-old chicks are still selling at exorbitant prices as breeders continue to flout the official rate due to lack of monitoring by the district livestock officials.
   Local poultry chick breeders, who market day-old baby birds through a network of several thousands dealers across the country, are yet to implement the rate set by the livestock authorities last month, industry people said.
   Amid shortage and spiralling price of chicks, the department of livestock services on April 26 fixed Tk 28 for a broiler chick at dealer level, Tk 25 for a white layer chick and Tk 30 for a red layer.
   But big hatcheries are still selling broiler chick at Tk 30-31 per piece to dealers, who market it at more than Tk 32 at retail level, industry sources said.
   Last year, the official rates were set at Tk 22 for broiler chick and Tk 25 for layer, which were also not implemented.
   Syed Tasaddaque Hossain, a dealer of Khulna area told New Age on Saturday that the breeders are yet to implement the government rates, and still selling day-old broiler chicks at their own rates of Tk 30-31 to the dealers.
   Shah Habibul Haque, director of Aftab Bahumukhi Farms, one of the large poultry firms in the country, said to New Age, ‘We unanimously have accepted the decision of the government regarding the chick price for the greater interest of the industry as well as the country. But it creates problems for us when many others do not follow the government decision.’
   At a meeting on May 24, the fisheries and livestock minister, Abdullah-Al-Noman, expressed concerns over the price hike of day-old chicks that make local poultry products expensive.
   A cartel of some five big hatcheries is taking the advantage of demand-supply gap, hitting the fledgling poultry industry hard and costing the consumers in general, the meeting observed.
   The country has been suffering from short supply of poultry chicks, which is set to linger for more six months due to the ban on import of chicks from major sources, livestock officials said.
   Local production of commercial layer chicks stands around 1.80 crore per week against the estimated demand of 2 crore.
   Weekly production of day-old broiler chicks is 35-40 lakhs and demand is 45-50 lakhs, and breeders hope that they would be able to meet the local demand in full within a year and the chick price would come down.
   When conducted, Moshiur Rahman, general secretary of Bangladesh Breeders Association, declined to comment on the price and production capacity.

Voicing grave concern over the non-enforcement of the anti-tobacco law even after one year of its enactment, anti-tobacco campaigners on Wednesday urged the government to impose up to 200 per cent of tax on all tobacco products.
   Their call came from a discursion meeting jointly organised by ADHUNIK, CAT, LIFE, SASC and WHO at National Press Club, marking the World No Tobacco Day.
   This year’s theme of the day is ‘Tobacco: Deadly in any form or disguise’.
   Chaired by ADHUNIK Founding President and National Prof Dr Nurul Islam, the meeting was addressed, among others, by Daily Independent Editor Mahbubul Alam and UNB Chairman and CAT President Amanullah Khan.
   Prof Nurul Islam, also a noted physician, said that there was hardly any one who would morally oppose the anti-tobacco law but the fact is that “we couldn’t implement it. It’s painful particularly for those who are involved in the anti-tobacco movement.”
   He said over 40,000 people lose their lives every year for using tobacco goods while a good number others suffer from deadly diseases like cancer, cardiac problems, stroke, hair loss and respiratory problems for using tobacco goods like cigarette, jarda and tobacco leaf.
   “Every tobacco good is a killer, no matter in which form it’s used,” he added.

US conglomerate General Electric will invest 250 million dollars in infrastructure and healthcare projects in India over the next decade, chairman and CEO Jeff Immelt said.
   ‘The next 10 years are critically important for India in terms of infrastructure,’ Immelt told a business meeting here late Tuesday.
   GE announced last year it would reinvest the 145 million dollar proceeds from the sale of a mothballed power plant in India and Immelt said the company would pump a further 100 million dollars into a development fund.
   The focus would be healthcare, cleaner energy, clean water and aviation projects, a company statement said.
   Immelt said GE planned to expand its presence further in India with GE Consumer Finance aiming to double revenues by 2010, investing aggressively in credit cards, home and personal loans, a company statement said.
   Immelt said the company was targeting eight billion dollar revenues and the same amount in assets by 2010, according to reports.

The Indian economy recorded growth of 8.4 per cent in the 2005-06 year, beating previous estimates of 8.1 per cent after a record preformance in the fourth quarter, the government said Wednesday.
   In the last quarter of the year to March, India clocked a record 9.3 per cent growth driven mainly by a healthy 5.5 per cent increase in agriculture, data released by the government’s Central Statistical Organisation showed.
   The better than expected performance in the last quarter was also due to healthy growth in manufacturing and services, it said.
   The farm sector, which accounts for about a quarter of India’s GDP, also boosted India’s annual GDP figure, growing by 3.9 per cent for the year compared to a meagre 0.7 per cent in 2004-05, the data showed.
   The figure is close to the government’s target of four per cent growth.
   ‘Agriculture has shown improvement,’ said Montek Singh Ahluwalia, deputy head of India’s Planning Commission, which helps frame economic policies for the country.
   There were no signs of overheating of the economy and all economic macro-indicators were in ‘reasonably okay shape,’ he was quoted as saying by the Press Trust of India news agency.

United Arab Emirates has signed three agreements with Pakistan that officials said would further boost the oil-rich state’s investment here, officials said Wednesday.
   The agreements were signed after talks between UAE Vice President and Prime Minister Sheikh Mohammad Bin Rashid Al-Maktoum and Prime Minister Shaukat Aziz during the UAE leader’s day-long visit here on Tuesday.
   Sheikh Mohammad also met President Pervez Musharraf and lauded ‘excellent relations between the two countries’ in a speech at a state banquet.
   The two sides signed a Memorandum of Understanding under which UAE Emmar Properties will participate in joint ventures for the development, improvement and modernization of infrastructure in Pakistan, including ports.
   Two other agreements related to investment by the UAE companies in construction of residential buildings and towns, highways, and airports and the development of Karachi Beach Front.
   This was the first official visit to Pakistan by Sheikh Mohammad since his elevation to the top offices in January this year. He last visited Pakistan in 2002 for a private hunting trip.
   The UAE is the largest investor in Pakistan after its state-run Etisalat bought controlling share in the privatised Pakistani telecom firm in June last year for 2.6 billion dollars.
   Pakistan’s government also agreed to authorise Dubai Islamic Bank to open 50 branches in Pakistan, officials said.
   Trade between the two countries totalled 2.78 billion dollars last year, with the balance in favour of the UAE due to Pakistan’s oil imports.

Cambodia’s garment and textile exports in 2005 jumped 10 per cent year-on-year to top two billion dollars for the first time, the International Labour Organisation said Wednesday.
   ‘This data is very encouraging,’ said Ros Harvey, chief technical advisor for ILO Better Factories Cambodia.
   ‘We are seeing a steady growth in the sector. However, there are still many challenges ahead for the industry,’ she said in a statement.
   Total exports reached almost 2.2-billion-dollars in 2005, and the boom created nearly 30,000 new jobs in a sector that was thought doomed after the end of an international quota system in January 2005, the ILO said.
   Under the 30-year-old multi-fibre arrangement (MFA), Cambodia was given special access to the US market through a 1999 trade deal that granted quotas in return for improved labour conditions monitored by the UN’s labour agency. The arrangement was hailed by international buyers, such as US company Gap Inc, which helped local manufacturers to mould an image of themselves as responsible corporate citizens who eschewed ‘sweatshop’ labour.
   Building on this reputation, and with the help of US and European Union safeguards enacted after the end of the MFA, Cambodia has been able to salvage its garment sector.

Private firms and investors pumped record high levels of capital funds into developing countries last year but most of the money failed to reach the poorest nations, the World Bank said Tuesday.
   Net capital flows into developing countries reached $491 billion in 2005, according to the bank’s annual report on global development finance.
   The rise was largely driven by privatisations, mergers and acquisitions, external debt refinancing and strong demand for emerging market debt and equities as investors flocked to higher yielding assets, it said.
   ‘These increased capital flows reflected greater confidence in the economic prospects of several developing countries,’ said World Bank chief economist Francois Bourguignon.
   Developing nations enjoyed combined economic growth last year of 6.4 per cent—topping 5.0 per cent for the third straight year and beating the 2.8 per cent pace of developed nations.
   The World Bank expects growth in developing countries to remain above five per cent per year through 2008, noted the report, which was presented at the bank’s annual conference on development economics in Tokyo.
   However, not all developing nations benefited from the record inflows, most of which were bound for a small group of middle income countries, it said.
   Russia and Turkey were major recipients, helping to lift flows into Europe and Central Asia as a whole by 19.7 per cent from 2004 to 191.7 billion dollars – 39 per cent of the total inflows.
   East Asia and the Pacific saw a rise of 9.8 per cent to $137.7 billion while flows into Latin America and the Caribbean jumped by 59.2 per cent to $94.4 billion.
   By contrast many low-income countries still have little or no access to international private capital, the report said.
   Flows into Sub-Saharan Africa remained relatively low at 28.4 billion dollars, although that marked an annual gain of 37.2 per cent.
   Private flows have so far withstood worries over high oil prices, rising global interest rates and growing trade imbalances, but developing countries must prepare for ‘whatever global storms may be brewing,’ the report warned.
   While current account deficits in developing countries as a whole are close to balance, oil-importing countries have seen their deficits increase substantially due to high energy costs and often unsustainable growth, it said.
   ‘All countries would be affected by a disorderly unwinding of global imbalances, which would destabilise international financial markets and curtail global growth,’ Bourguignon wrote in the foreword to the report.
   ‘But developing countries would suffer disproportionately, particularly if the imbalances were to foster and backlash of trade protectionism,’ he warned.
   The surge in capital flows also reflects rising trade flows and financial integration between developing countries, so-called ‘south-south flows’.

Leading drug manufacturer Beximco Pharmaceuticals Ltd has introduced three new products for the treatment of insomnia, respiratory and urinary tract infections and prevention of Bronchospasm.
   The drugs—S-Clon, Evo Solution and Respira—were introduced for the first time in the country, said a corporate announcement Wednesday.
   Another new drug, Respira, is indicated for the treatment or prevention of bronchospasm in adults, adolescents and children of or above 6 years of age with reversible obstructive airway disease. It contains Levosalbutamol and is available in two forms—tablet and syrup.
   The company will soon introduce two more drugs—Respira inhaler and Cesonide inhaler.

Windmill Advertising Limited recently opened a branch office in the port—Chittagong. The managing director of the company, Reazuddin Mosharaf, inaugurated the new branch.
   Windmill—an established event management organisation , has arranged some events are—GrameenPhone Mobile Fair in Japan Trade Fair, China Trade Fair, IT Fair, All University Fair, Corporate Bazaar Prime Bank Loan Fair etc.

Asia-Pacific trade ministers were due to push for speedy progress in talks to free up global trade at a meeting starting Thursday in Vietnam, the communist host nation said.
   The 21-nation Asia Pacific Economic Cooperation forum would focus on ways to revive World Trade Organisation talks to scrap many trade barriers by the end of the year, said Vietnam’s Deputy Foreign Minister Le Cong Phung.
   APEC officials had prepared a draft statement that, if adopted by the ministers, would ‘express their political resolve for the acceleration of the Doha round’ of talks launched in the Qatari capital in 2001, he said.
   They would make recommendations on overcoming the deadlock to the Doha round, which aims to slash subsidies, tariffs and other trade barriers and use commerce to boost the economies of developing countries.
   ‘The WTO may take or ignore these recommendations, but APEC ministers feel it is important they make their positions known,’ Phung said in Ho Chi Minh City, where more than 1,000 APEC officials have met for nine days.
   Vietnam is not yet a member of the Geneva-based WTO, but a market access agreement it expected to sign with the United States later Wednesday was set to move it a step closer to its decade-old goal.
   The deal with its former battlefield enemy, if signed and passed by the US Congress, would mean it has concluded talks with 28 trade partners, a precondition for WTO accession.
   Hanoi hopes to be a WTO member when it hosts an APEC summit in November.
   The APEC forum—whose members account for two thirds of global trade— groups Australia, Brunei, Canada, Chile, China, Hong Kong, Indonesia, Japan, Malaysia, Mexico, New Zealand, Papua New Guinea, Peru, the Philippines, Russia, Singapore, South Korea, Taiwan, Thailand, the US and Vietnam.
   The group operates by consensus, meaning each member’s approval is needed to reach a decision, and it only makes non-binding agreements.
   In 1994, APEC leaders at Bogor, Indonesia, set the goal of reaching a free trade and investment agreement by 2010 for developed economies and by 2020 for developing economies.

The world oil market is ‘well supplied,’ OPEC Conference President Edmund Daukoru told reporters ahead of a meeting here Thursday when the 11-member oil cartel will set its future production quota.
   ‘Everybody has to do the best they can to moderate the (tight market) situation, but there is no question that the market is well supplied,’ said Nigeria’s Minister of State for Petroleum on his arrival here Tuesday.
   Oil reserves, he added, were at a five-year high, ‘so we have to look elsewhere for the cause of the tightness of the market.’
   ‘Downstream problems,’ the minister said, included ‘geopolitical tensions, refining capacity.’
   Asked what OPEC could do to lower crude oil prices, Daukoru said: ‘it’s not the way to put it, but there are structural problems, there are also intangibles like the fear factor, and the fear factor is a major factor.’
   The Organization of Petroleum Exporting Countries began a series of consultations Tuesday in preparation for Thursday’s conference, when market analysts believe they will decide to maintain their current production quota of 28 million barrels per day—its highest level in a quarter century.
   Venezuelan President Hugo Chavez on Tuesday said he hoped his fellow OPEC members would decide against any increase in production.
   ‘The market supply is sufficient and there is no need to boost production to prevent a price drop and unbalancing a tight market,’ Chavez said during a brief visit to Quito.

The United States Tuesday urged ‘ambitious’ efforts by WTO-member countries to reach agreement on removing barriers to global trading rules before a deadline runs out at the end of this year.
   Deputy US Trade Representative Karan Bhatia told reporters in New Delhi a successful conclusion to the talks ‘requires an ambitious outlook and all countries concerned (need) to do more and to recognise that offers on the table in Geneva need to meaningfully open markets.’
   This would allow ‘the world’s poor ... greater access to markets of developed and developing countries,’ Bhatia said.
   He warned that a deal which was not ‘ambitious’ would not be passed by the US Congress and would also fail to meet the requirements of the Doha round.
   ‘The US is prepared to meet ambition with ambition but at this point we are still waiting for meaningful responses from our developed country partners,’ said Bhatia after talks in New Delhi with Indian Commerce and Industry Minister Kamal Nath aimed at boosting trade between the US and India.
   Bhatia’s comments come ahead of a WTO meeting in Geneva next month at which Crawford Falconer, New Zealand’s WTO ambassador, is expected to submit new outlines of deal aimed at breaking the impasse.

The United States and Vietnam signed a trade deal Wednesday, removing a major hurdle in the communist country’s bid to join the World Trade Organisation this year.
   The pact between the two former enemies is set to boost Vietnamese exports to the world’s largest economy and allows American companies greater access to Southeast Asia’s fastest growing economy, which expanded 8.4 per cent in 2005.
   It also paves the way for Vietnam’s bid to join the 149-nation WTO before Hanoi hosts an Asia Pacific Economic Cooperation (APEC) summit in November, due to bring leaders including US President George W. Bush.
   ‘This truly is an historic step in the relationship between our two countries,’ said Deputy US Trade Representative Karan Bhatia after signing the pact with Deputy Trade Minister Luong Van Tu.
   ‘It marks the passing of another milestone on the road to full normalisation between our two countries.’
   The United States was the last of 28 countries to sign a trade deal with Vietnam, which hopes to conclude multilateral WTO entry talks in July.

The first Rolls-Royce showroom opened in India Wednesday to woo the nation’s growing band of rich entrepreneurs with the ultimate symbol of luxury and status.
   Rolls-Royce, once the car of choice of the maharajas during British colonial rule, has sold about 10 models in the past year with Indian buyers customising their purchases with woven family crests, officials said.
   The Navnit Motors dealership said it hoped to grow and sell up to 30 cars a year from their showroom in the western economic city of Mumbai targeting entrepreneurs and industrialists.
   The current offering, the Phantom, has a price tag of nearly one million dollars, said Navnit marketing director Sharad Kachalia, whose company sells cars, yachts and jets to India’s wealthiest.
   ‘Young entrepreneurs are making good money and this is where we see some looking for an ultimate statement,’ Kachalia told AFP. ‘To earn such an ornament in life is an achievement for anyone.’
   Before India’s independence from British rule in 1947, the Rolls-Royce occupied pride of place in the royal garages of India’s maharajas with a 50-strong fleet belonging to the Nizam of Hyderabad.
   One of the company’s best customers was the Maharaja of Mysore who always purchased his Rollers in sevens. His buying habits passed into company lore as ‘doing a Mysore’.
   At least 20,000 Rolls-Royces rolled off the production line before World War II with a fifth of them bound for India. Many included such touches as curtains to shield wives from prying eyes.

World Bank President Paul Wolfowitz on Wednesday congratulated African nations for launching a campaign against corruption but said rich countries had to cooperate to stamp out graft.
   In a speech to businessmen here, Wolfowitz said that rich countries were deeply implicated in corruption in Africa.
   ‘For every bribe taker, there is a bribe giver and very often that bribe giver comes from a rich country,’ he said, adding: ‘I think we all have the responsibility to crack down.’
   Wolfowitz said that until recently corruption was so rife in the enegry sector in Africa the situation was considered hopeless but in the past two years, more than a dozen African countries had endorsed or implemented a World Bank blueprint called the Extractive Industries Transparency Initiative.
   ‘Just two years ago, experts looked at Africa’s oil and gas sector and threw up their hands.
   ‘They said corruption was so pervasive there that you couldn’t possibily make progress in promoting transparency and accountability in big energy contracts.
   ‘The situation isn’t perfect but that’s an excellent start in such a short time,’ Wolfowitz said.
   The World Bank initiative is aimed at committing governments to transparency on oil revenues so that people would know where the money is going, he said.

China on Wednesday accused the US of inflating its trade deficit figures and said the appreciation of its own currency would do little to improve Beijing’s trade surplus.
   ‘US statistics have inflated the bilateral trade imbalance,’ Chinese Commerce Minister Bo Xilai said in remarks published on his ministry’s website.
   According to previously released Chinese statistics, Beijing’s trade surplus with Washington last year was 114 billion dollars, but US methods of calculation put the deficit with China at a record 202 billion dollars.
   Bo pointed out that China’s trade surplus only accounts for 7.2 per cent of its total trade, far lower than the 52.2 per cent of Saudi Arabia, Brazil’s 20.8 per cent and Germany’s 11.3 per cent, Bo said.
   ‘Besides, 50.7 per cent of China’s trade surplus actually comes from those foreign-funded companies in China - we’re actually sharing these trade surpluses with other countries.’
   Although Bo’s comments offered no fresh Chinese position, they were released shortly after Henry Paulson, a top Wall Street banker who has had extensive dealings in China, was nominated to replace John Snow as US treasury secretary.
   China and the United States have sparred at times intensely in recent years over their trade relationship.
   One main focus of the tensions centers on what Washington says is Chinese exporters’ unfair trade advantage by Beijing keeping China’s currency artificially weak.

Japan’s economy is headed for its longest post-war expansion but away from the thronging shopping malls, new skyscrapers and luxury condominiums, many elderly and unemployed complain of losing out.
   Kurumada, 72, who declined to give his first name, says he can only afford two meals a day with his welfare payment of 96,000 yen (870 dollars) per month from the government, which also subsidises his rent.
   ‘I feel I just survive. I don’t feel I’m living a life,’ said the former blue-collar worker, who began receiving benefits four years ago after heart disease forced him to give up his job fixing electric equipment.
   Before, he earned up to five million yen, or about 45,000 dollars, a year.
   ‘Now I can’t afford three meals a day,’ he said with rueful smile in his small one-room apartment in Arakawa ward in the old area of Tokyo.
   Elsewhere in the capital, 71-year-old Kimiko Kimura has to make do with no bath or shower.
   ‘There is no room equipped with a bath available at a cheap enough rent in Tokyo,’ said Kimura, who ran a small polystyrene manufacturing business north of the city until her husband’s death.
   These are not extraordinary cases in Japan, which has prided itself since the end of World War II on being a classless society. Even today people in need are often reluctant to ask for help.
   ‘In Japan, poor people hide. Those who live on social security don’t talk about it because they think they are responsible for their own misfortune,’ said Kazuya Hata, a charity worker at The Group to Protect Living and Health.
   Homelessness, which was largely unknown in Japan until the economic bubble burst in the early 1990s, has also risen and many parks are dotted with the blue tarpaulins of their makeshift shelters.
   Japan’s economy may be finally emerging from the ‘lost decade’ of deflation but it is still expected to have more than one million households on welfare on average in the year to March, according to the most recent government survey.
   This is about two per cent of the total number of households in Japan and a 60 per cent jump from 10 years ago, according to the Ministry of Health, Welfare and Labour.
   While the increase is largely due to the aging population, the total number of working-age people on welfare, including disability and other benefits, has also gone up.Almost 20 per cent of the Japanese population is now aged 65 or older.
   This ratio, already at a record high, will only increase as post-war baby boomers approach retirement age, while the falling birthrate is set to put increasing strains on the public finances.
   The numbers don’t tell the whole story.
   While some struggle to scrape by, those with cash to burn head for ultra-chic shopping complexes in Tokyo with jaw-dropping prices, such as Roppongi Hills and its new sister mall Omotesando Hills.
   Social inequalities may still be less pronounced in Japan than many other countries but there is increasing public concern about the emergence of the ‘haves’ and the ‘have-nots’—and the rising number of Japanese millionaires.
   A poll in March by the Yomiuri newspaper found that some 81 per cent of Japanese people think the income gap is widening and many blame Prime Minister Junichiro Koizumi’s reforms as he seeks to slim down the government.
   According to the Organisation for Economic Co-operation and Development (OECD), Japan’s gini coefficient, a leading measure of inequality, stood at 0.314 in 2004, worse than Germany, France and Scandinavian nations but better than the United States and Britain.
   In 1969 Japan’s gini coefficient was 0.316, above France’s 0.414 at around the same time, where zero corresponds to perfect equality and 1.0 to perfect inequality.

Zimbabwe has signed a 50-million-dollar (39 million euros) loan deal with French bank BNP Paribas to purchase fuel and ease shortages that are threatening to bring the economy to its knees, state media reported Wednesday.
   The loan will allow the National Oil Company of Zimbabwe (Noczim) to import fuel for the private and public sectors, the state Herald newspaper said.
   ‘This facility will go a long way in addressing the country’s fuel needs. Fuel supply from the first drawdown is expected in June 2006,’ the newspaper quoted central bank governor Gideon Gono as saying at the signing of the deal in Harare.
   Gono said the deal could be the first in a string of loan agreements to help ease the fuel crisis.
   ‘But for it to be renewable, it depends on our ability to service the facility,’ he said.
   Zimbabwe has been struggling with fuel shortages for nearly seven years due to a foreign currency crunch.

A United Arab Emirates-based fund said Wednesday it would invest 120 million dollars to build power plants that use rice husks to make energy in Thailand.
   Al Tayyar Energy, which is owned by Morocco’s Price Moulay Hicham Ben Abdallah, said it aimed to bring alternative energy resources to the kingdom in the face of soaring global oil prices.
   The company set up a rice-husk energy plant in Pichit province, northern Thailand, this month with an investment worth 1.5 billion baht (40 million dollars).
   It would build more eco-friendly energy plants in Thailand with total investments estimated at three billion baht (80 million dollars).

US retail giant Wal-Mart said Wednesday it had taken several brands of children’s clothes off its shelves in China after they were found to contain a cancer-causing dye.
   Wal-Mart stores in Guangdong province were selling nine Chinese brands of children’s clothes that contained a dye that could decompose into toxic aromatic amine compounds, the Beijing News reported.
   One of Wal-Mart’s Beijing stores was also selling some of the brands, the Beijing Daily Messenger said.
   Wal-Mart acknowledged Wednesday that children’s clothes containing the harmful dye were sold at those shops and said the company had suspended selling them while an investigation took place.
   ‘(This) is unacceptable. We are currently investigating... to prevent similar incidents from happening,’ Huang Jianling, manager of public relations of Walmart’s China head office in south China’s Shenzhen city, told AFP.
   ‘We are actively cooperating with relevant government departments.’
   Guangdong’s provincial trade and commerce bureau has issued an urgent order to suspend sales of the substandard children’s clothes, the Beijing News said.
   Huang declined to say whether those suspect clothes were currently sold in the Wal-Mart’s US or other overseas branches.
   Wal-Mart operates in 22 Chinese cities.

World crude prices fell on Wednesday, the eve of the latest OPEC output decision and the weekly US energy report, after spiking above 72 dollars the previous day on Iran concerns.
   New York's main contract, light sweet crude for delivery in July, fell 68 cents to 71.35 dollars per barrel in electronic deals before official opening of the US market.
   In London, Brent North Sea crude for July delivery sank by 51 cents to 70.54 dollars per barrel in electronic trading.
   Prices were dampened by expectations that the Organisation of Petroleum Exporting Countries (OPEC) will stick with the oil cartel's current production quotas when they meet on Thursday.
   'It looks like (OPEC) are not going to reduce production levels (so) the market has sold off,' said Tony Nunan, a Tokyo-based energy risk manager for Mitsubishi Corp.
   OPEC ministers meet in Caracas to decide production levels but delegates have indicated the 11-member oil cartel will keep its official production quota intact.
   The oil cartel has an official production quota of 28 million barrels of day, its highest level in 25 years.

GP centre opens
in Rangpur
THE Grameen Phone Ltd opened a Grameen Phone Centre at the central road of Rangpur town Wednesday to provide ‘one stop solution’ for the patrons facilitating with all telecommunication products and services. Khalid Hasan, Director, (Regulatory and Corporate Affairs) inaugurated the center amid a huge gathering while Sayed Yameen Bakht, General Manager (Information) and other senior executives of the company were present in the inaugural ceremony. Khaled Hasan told that the main objective of the Grameen phone centre is to enhance customer experience, service and ensuring to provide them with genuine products at competitive prices.
— New Age

BGMEA restarts monitoring
The Bangladesh Garment Manufacturers and Exporters Association has restarted its inspection of factories from May 30 after one-week suspension of monitoring due to labour unrest situation in the sector. The BGMEA surveillance teams have so far inspected 1890 factories in last two months under a three-month-long crash programme for prevention of fire incidents as well as ensuring safety standards in garment factories.
— BDNews

Audit workshop
today
A workshop on Interaction between Auditor and Auditee Organisation for Improved Audit Environment will be held at 7pm at a city hotel Thursday. Comptroller and Auditor General Asif Ali will present as chief guest in the workshop, organised by Modernisation of the Ministry of Water Resources’ Financial Management Capability Project. Water Resources Secretary Sayed M Zobaer and Robert Beadle, Acting High Commissioner and Head of Development Cooperation of Canadian High Commission, will be the special guests.
— UNB