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Private mobile phone companies look set to invest around $1 billion this year to improve the capacity of their networks and the quality of their services.
   ‘I believe the mobile phone operators altogether will pump around $1 billion investment this year,’ said Lars P Reichelt, chief executive officer of Banglalink, on Wednesday.
   The companies have invested more than $2 billion as of 2005, since the introduction of mobile phone in Bangladesh in 1992, industry insiders say.
   Reichelt would not reveal how much more Banglalink plans to invest and said the company would stick to its announcement in February 2005 of an investment of around $300 million in two years up to 2006.
   Industry insiders say majority of the planned investment will be reinvestment of their profit, except that of Warid Telecom, the sixth mobile phone operator in the country which is expected to launch its service in September.
   Warid, a concern of the Dhabi group of the United Arab Emirates, will invest around $400 million to build up a mega infrastructure to acquire around 6 million customers within three years of commencing its operation, industry insiders say.
   Warid obtained the licence from the Bangladesh government in December by paying around $50 million in licence acquisition fees.
   The GrameenPhone chief executive officer, Erik Aas, on May 4 said the largest operator would invest this year an amount close to its $300 million investment in 2005 to improve its network capacity.
   Meanwhile, as part of its network expansion and improvement plan, GrameenPhone, which controls 62 per cent market share, has already awarded a $150 million contract to Ericsson.
   Industry insiders say the major focus of investment of the operators this year will be to improve the capacity of their networks and the quality of their services on highways, indoors and in high-rises. Most of the operators have already expanded their coverage to about 90 per cent of the country.
   ‘We will invest a significant amount in expansion to provide our customers seamless connectivity when they are on major highways or in high-rise buildings or indoors,’ Aas said.
   The second largest operator AkTel, which has 28 per cent market share, will invest around $200 million this year, a top official of the company said.
   AkTel on Wednesday awarded a $100-million network-expansion contract to Huawei Technologies Co Ltd of China.
   CityCell, the fourth largest operator with 4.4 per cent the market share is likely to invest more or less $150 million this year, according to a CityCell official.
   Despite the possibility of huge investment in the sector, mobile operators are worried about the Tk 900 tax on subscriber identification module card the government has imposed. The tax has forced the operators into providing subsidy to keep the start-up cost low.
   The operators need eight to nine months to recoup the Tk 900 subsidy from a new user, Reichelt said.
   ‘If we did not have to pay the SIM taxes, we could offer $30 low-cost handsets made for emerging markets to our customers at a subsidised rate,’ he added.
   A report of the international consulting firm Frontier economics has, meanwhile, pointed out that mobile phone-specific taxes such tax on SIM card and handset is a barrier to the growth of the market.
   If taxes on SIM cards and handsets were withdrawn, there would be around 24.7 million subscribers in 2009 and tax revenue would be around Tk 30.4 billion because of an increased usage of mobile phones for increased subscription rate, according to the report.
   With the taxes in place, there would be around 22.4 million subscribers in 2009 and tax revenue would be around Tk 30.3 billion.
   A report of another reputed consulting firm Ovum said despite the barrier, the mobile industry is contributing $650 million per annum to the economy.
   Bangladesh currently has five operators including the state owned Teletalk Bangladesh Limited altogether have 11.1 million customers.

The Bangladesh Textile Mills Association demanded that the government provides more financial supports for primary textile manufacturers who meet the demand of fabrics in local markets and supply raw materials to the apparel exporters.
   In the budget proposals placed to the National Board of Revenue, the BTMA, apex body of county’s spinners and weavers, sought easy funds for their projects, further cut in tax rates and reduction of duty on imported synthetic yarns and chemicals.
   The association also sought total withdrawal of duty from imported machinery and installations for textile plants.
   The BTMA urged the government to fix seven per cent interest on bank loans to textile projects instead of up to 13 per cent now, as high interests rates discourage textile investors.
   ‘Primary textile industries should be taxed at 0.25 per cent—the rate that is imposed on export-oriented woven and knit apparel manufacturers,’ demanded the BTMA. At present primary textile units pay 15 per cent corporate tax.
   The BTMA demanded 20 per cent cash subsidy for local spinners who have to import 98 per cent of cotton from abroad and become uncompetitive with the Chinese and the Indian.
   At present local spinners supplying yarn for apparel exporters get five per cent cash incentive, which is scheduled to end by June 30 this year. The association demanded continuation of enhanced incentive up to 2010.
   The association prescribed that the existing tax holiday to new textile needs to be extended up to 2010 if the government wants to allure investments in backward linkage industries to feed shortage of fabrics and yarns to apparel exporters.
   The BTMA has also urged the government to continue giving cash subsidy to the sector till 2010 to help the industry to retain its external market amid stiff competition from some neighbouring countries.
   The association demanded withdrawal of duty and taxes on importing spare parts, industrial air-conditioning equipment, fork lifts, prefabricates industrial buildings and chemicals the textile processors use.
   The BTMA demanded withdrawal of 15 per cent value added tax and four per cent infrastructure development surcharge on imported synthetic yarns- viscos staple fibre that is used by local weavers.
   The association urged the government to withdraw 7.5 per cent import duty on the Effluent Treatment Plant machinery which is required for developing environment-friendly textile processing industries prescribed by apparel buyers.
   The association, however, demanded that the government increase duty on imported fabrics arguing that floods of cheaper fabrics imported through under-invoicing affect local industry.

EU anti-dumping duties on Vietnamese-made footwear impact nearly one million people in the developing country, many of whom live on around one dollar a day, an anti-poverty group said Friday.
   ‘The European Commission should reconsider the imposition of the anti-dumping duty and ensure that Vietnamese footwear workers are not the ones paying the price of the mounting trade dispute,’ said ActionAid.
   EU duties being doubled to 8.4 per cent Friday could put up to 500,000 workers and many employees in related industries out of work, said ActionAid and the Vietnam Leather and Footwear Association.
   The trade group said orders fell rapidly in mid-2005 when the European Union started proceedings, accusing Vietnam of unfairly subsidising the sector, leading many shoe-makers to cut output and lay off workers.
   EU Trade Commissioner Peter Mandelson has said duties were imposed on Chinese and Vietnamese leather shoes in April because the governments and manufacturers there had been engaged in unfair trade practices.
   Mandelson said Chinese and Vietnamese factories enjoyed state aid in the form of soft loans, tax breaks, low rents, fuzzy accounting and export incentives.
   The duties are to be imposed gradually over five months and will rise to 19.4 per cent for leather shoes from China and 16.8 per cent for leather shoes from Vietnam. Children’s shoes are not covered by the measures.
   Vietnam has vowed to lobby for the duties to be lifted, insisting its footwear industry, one of the country’s strongest export earners, had abided by free market principles.

Pakistan will spend a record 415 billion rupees ($6.92 billion) on development this year to fight poverty and maintain a growth rate of more than six per cent, officials said.
   The national budget for fiscal 2006-2007 starting July 1, to be unveiled in parliament on Monday will ‘focus on human and infrastructure development,’ minister of state for finance Omar Ayub said.
   Development will be allocated 415 billion rupees ($6.92 billion) compared to 4.5 billion dollars in the previous budget.
   Ayub did not divulge the size of the budget but other officials estimate it at $25 billion, against the outgoing year’s revised budget of 20 billion.
   ‘The new budget would help create more job opportunities, promote developmental activities besides protecting the interest of weak segments of the society,’ Ayub said.
   The budget comes amid resentment among the salaried class and low- income groups with inflation running at 13 per cent and unemployment at nine per cent, economists said.
   More than 25 per cent of Pakistan’s 150-million people live below the poverty line.
   In a pre-budget briefing Ayub told reporters on Wednesday that the government plans to bring down inflation to less than eight per cent.
   He said gross domestic product (GDP) growth was around 6.6 per cent.
   However the fiscal deficit rose this year from 3.5 per cent to 4.2 per cent of GDP, due to the massive earthquake in October that killed more than 73,000 people in Pakistani Kashmir and North West Frontier Province, he said.
   The government hopes to meet the gap through taxes and borrowing. Officials hope revenue collection will rise to $14.7 billion from 11.5 billion this year
   Ayub said unemployment was declining as 5.58 million new jobs had been created over the past two years and poverty reduced to 25.6 per cent from 32.4 per cent in previous years.
   President Pervez Musharraf this week said Pakistan would be able to achieve the UN-set poverty ratio of 13 per cent by 2015.
   ‘Investment is flowing into Pakistan from all over the world and in every sector,’ Musharraf said.
   ‘More jobs are available today - but we have to create more jobs - and we are determined to reduce poverty through employment generation.’
   Direct foreign investment in the first 10 months of 2005-06 was three billion dollars, compared to 1.5 billion dollars the previous year.
   ‘This is new Pakistan moving forward and we will lift the country to new heights of economic progress,’ Musharraf said.

Investment in Bangladesh’s potential energy sector and cut-price import of petroleum fuels from the oil-rich Gulf State may top the agenda of talks during the upcoming visit of Kuwait’s Emir, official sources said.
   Emir of Kuwait Sheikh Sabah Al-Ahmad Al-Jaber Al-Sabah arrives here on June 10 at the invitation of Prime Minister Khaleda Zia, in a prompt reciprocation of top-level tours.
   He will be leading an 80-member entourage that would include all the important cabinet ministers.
   The Emir flies in here on the first leg of his 4-nation tour that will also take him to India, Pakistan and Thailand.
   Prime Minister Khaleda Zia’s Kuwait visit is seen very important from Bangladesh side as the Kuwaiti government agreed to sell oil to Bangladesh on credit at favourable price and withdrew restrictions on recruit of manpower from Bangladesh.
   According to the sources, the Energy Ministry has already sent suggestions on the issues to the Finance Ministry to set the agenda.
   They said that, during the recent visit of Prime Minister Khaleda Zia to Kuwait, the top leadership of the host country evinced their great interest in investing in the energy sector of Bangladesh.
   Particularly, the Kuwaiti leaders expressed an earnest desire to build fuel storage and special jetty at the Bay coast that will be directly connected with the state-owned Eastern Refinery located a Chittagong port with undersea pipeline.
   The primary purpose of setting up the proposed storage and special jetty would be facilitating easier supply of petroleum fuels to Bangladesh from Kuwait.
   After the setting up of the storage and jetty, Kuwait will then bring petroleum at convenient time from its own land and store it in Bangladesh territory to build a regional oil hub.
   The sources said Kuwait has a plan to extend the facilities of the storage and jetty in future to market its products to other countries in the region.
   Initially, they may invest 100 million dollars to build the storage with a capacity of about 2 lakh tons, while the proposed jetty will cost about US$ 200 million.
   Energy Ministry officials said Bangladesh is one of the largest buyers of petroleum from Kuwait.
   Annually Bangladesh imports about 2.0 million (20 lakh) tons of refined petroleum fuel from Kuwait while it imports 1.4 tons (14 lakh) tons of crude oil from India, Saudi Arabia and some other Middle East countries to meet the total consumption of 3.2 million (32 lakh) tons.
   Bangladesh will seek a concession rate and a deferred-payment facility in importing petroleum from Kuwait.
   During a visit of Advisor of the Energy Ministry Mahmadur Rahman to Kuwait, the Kuwaiti authority agreed to accept a deferred-payment for 180 days against the petroleum imports.
   During her visit, Prime Minister Khaleda Zia urged the Kuwaiti leaders to extend the deferred-payment period to 360 days from 180 days.
   During the Emir’s visit, Bangladesh will again seek the concession in import and deferred payment after 360 days.
   Presently, Bangladesh has to make cash purchase of petroleum from Kuwait—and the country fell in trouble during the recent dollar crunch in footing the bill for oil import to meet a growing demand.
   The sources said Kuwait might offer to build a refinery of 4-million-ton capacity in Bangladesh during its Emir’s visit.

India Thursday said it was against lowering ambitions at the WTO and wanted that any possible deal should be a complete package of agriculture, industrial goods and services.
   ‘No, it all has to happen as a package deal,’ Commerce Minister Kamal Nath said here.
   ‘If developed nations want market access in agriculture they should be willing to give the same access to developing nations in services,’ he said.
   He said farm subsidies cannot be used for promoting trade and distorting global markets. ‘Certainly the subsidies have to go. You cannot ask developing countries to open markets without eliminating your subsidy in real terms,’ he said.

The World Bank on Thursday unveiled a lending program of up to 6.5 billion dollars for Pakistan under a new four-year aid strategy showing a significant increase in funding aimed largely at beefing up the country’s infrastructure.
   The 2006-2009 strategy’s blueprint, discussed at the bank’s board of executive directors on Thursday, envisaged ‘a flexible lending program of up to 6.5 billion dollars,’ the Washington-based institution said.
   The new lending shows ‘a substantial increase over the previous period,’ the bank said in a statement.

The Finance Ministry has blamed the House Building Finance Corporation for intensifying sufferings of the subscribers with time-consuming loan distribution system and harassment in return of mortgage documents, sources said.
   The Finance Ministry in a recent letter has asked the HBFC to address these problems of the subscribers immediately.
   ‘The HBFC was asked to inform the finance division on the progresses of the directives by two months,’ a letter of the Finance Ministry issued on May 25 said.
   The letter said, without addressing subscribers’ problems, neither the corporation nor the subscribers would get the benefit from rising of the loan ceiling and reducing the interest rate.
   Finance Ministry last week raised the HBFC’s loan ceiling to Tk 40 lakh from Tk 25 lakh and reduced the interest rate at 12 per cent from 13 per cent and 15 per cent, official sources said.
   According to HBFC sources, there are about 45 thousand subscribers across the country and they face huge troubles during taking or repaying of their loans due to alleged corruption of the officials.
   Even after repayment of the loan amount, the subscribers have to face a lot of hassles during taking their mortgage documents back, the finance ministry letter said.
   The ministry has asked the corporation to identify the officials responsible for harassment of the subscribers and punish them accordingly.
   ‘Otherwise, the subscribers will not benefit from raising of the loan ceiling or reduction of interest rate,’ a finance ministry source said.
   They (HBFC officials) need to be very honest, he added.
   Meanwhile, a HBFC top official told BDNEWS that the decision of increasing loan ceiling and reduction of interest rate would be implemented from July. On a policy formulation, he said the HBFC has already simplified some procedures in distribution of loan.
   He said the recent government decision would have a great impact in the house building financing.

A high-profile Malaysian trade delegation arrives here today with significant investment proposals for sectors like port, infrastructure and chemical fertiliser.
   The 11-member delegation of Malaysian South-South Association and Malaysia Industrial Develop-ment Authority will stay in Bang-ladesh till June 7 processing the investment packages in consultation with government authorities.
   They will have discussions with the Commerce Minister and top executives of the Board of Investment, FBCCI, BEPZA, Export Promotion Bureau, Chittagong Chamber of Commerce and Indus-try and other chamber bodies.
   Secretary general of Bangladesh-Malaysia Chamber of Commerce and Industry Syed Moazzam Hossain told UNB that the delegation would take a close look at the investment climate in the country, especially in Chittagong seaport.
   ‘Malaysia has huge interest in investment in the seaport for increasing its efficiency and they are likely to discuss it with the government during the visit,’ he said.
   Moazzam said that the delegation would comprise some highly experienced investors and professionals, particularly for the port and infrastructure sectors.
   The team is also expected to show interest in investing in herbal medicine, industrial ventures like electronic and electrical industry, chemical fertilizer and agro-chemical sectors and expanding road communications network.
   He said that initially the delegation would inspect the investment situation and conduct a feasibility study. Following the study, they will come up with concrete investment proposals.

Stevia, a kind of herbal plant which is widely used as an alternative to sugar in many developed countries like Australia, Canada, China, Japan and the United States for a long time can help meet country’s growing demand for sugar , an expert said.
   The scientific name of the herbal plant is ‘Stevia Serrata’ and family name being ‘Asteraceae’. It is sometimes known as sweet leaf or ‘Chinipata’.
   Talking to BSS ,herbal scientist Dr Alamgir Mati said the compound made of stevai leaf is 300 times sweetener than our common sugar.
   Elaborating the quality of the plant, he further said 5gm- stevia leaf contains the same power as it exists in 1kg of sugar. Dr Mati said 1kg of sugar is being sold now at Taka 65 while it takes at best only Taka 5 to produce 5gm stevia.
   ‘Bangladesh being an agro-based country could easily cultivate the plant in its vast ‘char’ lands as it grows well in open space having regular sunlight ‘, he added. ‘After 60 days of cultivation, the leaf of the plant can be harvested and be turned into granules like that of sugar’, said the herbal expert.
   The renowned herbal expert said the Stevia granules could be used in making bread, lozenge, biscuit and sweetmeat like of sugar. Dr Alamgir, who is now working with the plant, said ‘if the country’s vast char areas are brought under Stevia cultivation it can help minimize import of sugar side by side help create job opportunities for large number of unemployed youths.
   Describing medicinal quality of the plant, the herbal expert said it has no side effect as an alternative to sugar. Rather it reduces blood pressure risks of the obesity and diabetic patients because it contains low-carbohydrate.
   The expert urged the government to take effective measures for cultivation of the plant especially in the backdrop of fall of sugar production in Bangladesh.

Sugar is enjoying a revival in the Philippines, a decade after the traditional producer saw output slump and was forced to rely on imports, an industry official said Friday.
   ‘Next year should be a bumper crop,’ predicted Philippine Sugar Research Institute director-general Leon Arceo.
   The industry expects production in the crop year starting in September 2006 to rise eight per cent from an estimated 2.1 million tonnes in the previous season, he told a news conference.
   This year, with world sugar prices rising to around 20 US cents a pound levels, the Philippines managed to export about 200,000 tonnes, though the bulk of it was sold to the United States, which gives the Philippines a quota allocation with guaranteed premium prices of up to 24 cents a pound, he added.
   Higher-yielding and more pest and disease-resistance varieties developed and spread by the institute, improved milling efficiency, the use of new technologies, as well as buoyant global demand helped turn the industry around, he added.
   Domestic consumption of sugar outstripped production in the Philippines in 1995, when output was flat, forcing the government to import more than 800,000 tonnes of raw and refined sugar, Arceo said.
   The industry was hit hard by a nationwide land reform program that forced the breakup of large corporate farms usually owned by traditional landowning families into small plots of as little as two hectares, he said.
   The cash crop requires at least 25 hectares to achieve economies of scale, he added.
   Raw cane sugar production in some traditional growing areas such as Negros island now reach 80 tonnes per hectare (2.47 acres), compared to the world average of about 60 tonnes, Arceo said.

Germany is hoping the million soccer fans expected for the World Cup will give its torpid economy a mighty kick.
   The country expects more than $12 billion in spending and 50,000 new jobs, and has put on a friendliness campaign aimed at nudging sometimes-somber service workers to brighten up for the June 9-July 9 tournament in 12 cities.
   But businesses, economists and politicians are hoping for even more - a boost in overall optimism to lift the gloom after four years of economic stagnation and hand-wringing, and a chance to show off Germany’s vaunted order and efficiency to potential investors.
   But the task is huge and victory by no means guaranteed. After all, Germany’s unemployment is above 12 per cent and economic growth stalled completely in the last quarter of 2005.
   Worse, in the eyes of many, the country’s team is not cooperating. A humiliating 4-1 loss to Italy in a warm-up match at the beginning of March raised fears of a World Cup flop that would leave the host country smiling through gritted teeth, and would take the air out of any boost in sentiment.
   Economists are quick to declare the event will have an immediate, measurable effect on the national economy. Some 50,000 jobs are expected to be created to help staff hotels, shops and venues hosting the games. Those jobs, the government hopes, will be permanent. The government has estimated that gross domestic product could increase by half a per cent during the month long event.
   Ahead of the 2002 World Cup, the economies of joint hosts Japan and South Korea were ailing, and they hoped the tournament would help spark a revival and increase their global stature.

World oil prices rose on Friday as the market focus remained with major crude producer Iran.
   Dealers were also absorbing an announcement from the Organisation of Petroleum Exporting Countries (OPEC) that it would maintain oil output at 28 million barrels per day.
   New York’s main contract, light sweet crude for delivery in July, added 46 cents to 70.80 dollars per barrel in electronic deals before the official opening of the US market.
   In London, Brent North Sea crude for July delivery advanced 39 cents to 69.78 dollars per barrel in electronic trading.
   Crude futures has shed around one dollar on Thursday after data from the US Department of Energy showed a rise in US energy reserves.
   Six world powers agreed on Thursday on a incentive package of benefits if Iran suspended its nuclear fuel work, which has raised fears of weapons development, but threatened penalties if Tehran refuses to comply.
   The meeting of foreign ministers from Britain, Russia, China, France, Germany and the United States was held on Thursday in Vienna.
   Market expectations are that Iran will reject the package, paving the way for possible UN sanctions over its disputed nuclear energy ambitions.
   ‘I don’t think Iran will accept the incentive package; they are not driven by economic concerns,’ said Daruisz Kowalczyk a Hong Kong-based investment strategist with CFC Seymour.
   ‘(The West) can’t bargain on economic terms, it’s not what they respond to, I don’t think the new package will accomplish its objective,’ he said, adding that the likely rejection would make the possibility of military action or UN sanctions very real.
   Analysts fear that Iran—the world’s fourth largest producer of crude and the second-biggest member of OPEC—might cut oil exports in retaliation.
   OPEC ministers, meeting in the Venezuelan capital of Caracas, agreed late Thursday to keep oil output at a 25-year high—but said they would watch out for any signs of a global slowdown that might merit a cut in the months ahead.

European stocks rose on Friday, recovering part of recent losses as investors seized on news that the New York Stock Exchange Group was to acquire the pan-European stock market Euronext.
   The 10-billion-dollar (7.8-billion-euro) cash and stock deal, announced overnight in New York, will create the first trans-Atlantic securities market—to be named NYSE Euronext—and placed pressure on rival exchanges to consolidate, dealers said.
   In Friday’s early European trading in Paris the CAC 40 index surged 1.25 per cent to 5,009.09 points.
   Frankfurt’s DAX 30 rose 1.00 per cent to 5,764.41 points and London’s FTSE 100 index of leading shares added 0.68 per cent to 5,788.80 points
   The DJ Euro Stoxx 50 index of leading eurozone shares won 0.94 per cent to 3,682.64 points.
   The euro stood at 1.2812 dollars.
   In Paris trading, NYSE Group’s decision to acquire Euronext sent the share price of its European rival rocketing by as much as 3.7 per cent to 70.75 euros.
   It later stood at 70.4 euros, an increase of 2.18 per cent from Thursday’s close.
   ‘NYSE Group reached a definitive agreement to merge with Euronext, lifting the shares of the pan-European bourse operator,’ analysts at the Sucden brokerage said.
   ‘The merge puts more pressure on its rival European exchanges to look more seriously for partners.’
   The 214-year-old NYSE trumped a competing bid by Deutsche Boerse, the German operator of the Frankfurt stock exchange, to acquire Paris-based Euronext, which operates bourses in Paris, Amsterdam, Brussels and Lisbon.

The dollar was little changed on Friday before the release of key US unemployment data that could provide clues over the future direction for American borrowing costs, dealers said.
   The euro edged up to 1.2811 dollars in early European trading from 1.2802 dollars late on Thursday in New York.
   The dollar gained to 112.88 yen from 112.57 yen on Thursday.
   Analysts expect Friday’s US jobs data, one of the key indicators of US economic momentum, to show 175,000 new jobs created last month.
   ‘An in-line gain... would be enough to keep the market pricing about a 70 per cent probability of another 0.25-point increase in the federal funds rate to 5.25 per cent on 29th June,’ said Derek Halpenny, senior currency economist at the Bank of Tokyo-Mitsubishi.
   The dollar has recovered some ground after minutes of the Federal Reserve’s May meeting, released on Wednesday, raised expectations of a further interest rate hike after 16 consecutive rises since June 2004.
   The US administration had announced Wednesday that it was ready to join European-led negotiations if Tehran suspended uranium enrichment, a process which can be extended to making the fissile core of a nuclear weapon.
   The euro was changing hands at 1.2811 dollars against 1.2802 on Thursday, 144.57 yen (144.20), 0.6872 pounds (0.6863) and 1.5643 Swiss francs (1.5638).
   The dollar stood at 112.88 yen (112.64) and 1.2211 Swiss francs (1.2216).
   The pound was being traded at 1.8642 dollars (1.8645).
   On the London Bullion Market, the price of an ounce of gold rose to 631.10 dollars per ounce, from 625 dollars late on Thursday.

Bank of China shares extended gains Friday after a better-than-expected debut Thursday following the world’s six largest Initial Public Offer (IPO) but dealers said profit-taking is expected next week.
   The mainland’s second-largest lender closed the day up 2.21 per cent at 3.475 Hong Kong dollars (45 US cents), off a low of 3.40 dollars and a high of 3.50 dollars.
   On Thursday, Bank of China had finished at 3.40 dollars, up 15.25 per cent from its IPO price of 2.95 dollars.
   The Hang Seng Index ended Friday up 267.44 points or 1.71 per cent at 15,912.71 on a technical rebound following Thursday’s fall with Wall Street’s overnight rally providing support.
   ‘Institutional investors are continuing to accumulate Bank of China because they expect its inclusion to different indices and also for the stock to trend higher,’ said Kitty Chan, director at Celestial Asia Securities Holdings.
   ‘Some institutions are also buying the stock ahead of their plans to issue warrants (derivatives) on the bank,’ she added.
   The Bank of China, whose Hong Kong unit is already listed here, raised 9.725 billion US dollars from the IPO with the price set near the top of the indicated range of 2.50-3.00 dollars.

Indian share prices rose 3.7 per cent Friday, snapping three days of losses, led by firmer global market trends and investor buying at lower levels, dealers said.
   They said it was the biggest single day gain for the markets in nearly two years, after a fortnight of sharp losses which saw the benchmark Sensex index slipping over 17 per cent since record highs in early May.
   The benchmark 30-share Mumbai stock exchange Sensex fell in morning trade to 10,011.45, before gaining smartly to close 379.91 points up at 10,451.33.
   The markets opened cautiously, fell close to the 10,000 level but recovered in afternoon trade on sustained buying in automobile and metal stocks.
   Automobiles gained on strong May sales figures while metals rose on expectations of firmer levels next week.
   The rupee recovered Friday to 46.1 to the dollar after plunging to three-year lows earlier this week as some banks sold dollars to steady the slide.
   Fund managers remained cautious about future market trends.

Nissan Motor said Friday it had agreed to expand an alliance with Suzuki Motor Corp in mini-vehicles as Japan’s number two automaker looks to reinvigorate its sluggish domestic sales.
   Suzuki already supplies mini-cars to its Japanese partner and from the end of 2006 will provide another mini-vehicle to be sold under the Nissan brand in Japan as well as a new small car, mainly for Europe, from 2008.
   Nissan meanwhile will supply a mini-van to Suzuki from the end of this year and a compact pick-up truck mainly for the North American market from 2008.
   The two firms will also share production sites in emerging markets, starting with Suzuki’s manufacturing plant in India, the companies said.

Pharmaceutical group GlaxoSmithKline (GSK) is planning to offer close to 16 billion dollars (12.49 billion euros) for the consumer health care business of its US rival Pfizer, industry sources said Friday.
   Sources told AFX News, AFP’s financial newswire subsidiary, that GSK, which is based in Britain, was preparing to submit a bid “close to 16 billion dollars”.
   The Financial Times reported Friday that GSK was to offer more than 15 billion dollars.
   Citing people close to the negotiations, the FT said GSK has decided to move ahead with a bid that would turn it into the world’s biggest producer of non-prescription drugs and into the second-largest prescription drugs supplier.
   Bids close on Tuesday for Pfizer’s healthcare or “over-the-counter” business.
   Britain’s leading financial news daily said that GSK would probably face competition from half a dozen firms, including Colgate-Palmolive, Reckitt Benckiser, Johnson And Johnson, Wyeth and, possibly, Bayer.
   GSK is targeting the Pfizer unit to bolster its negotiating position with govern- ments and retailers by offering a wide range of medicines as well as boosting its sales in the United States, the newspaper said.
   GSK’s share price was trading down 0.33 percent at 1,491 pence in late morning deals on London’s FTSE 100 index. The leading-share index showed a gain of 0.54 percent to 5,780.80 points.

OPEC nations Thursday held informal talks on admitting Angola, Sudan and possibly Ecuador into their ranks in a move that would tighten the cartel’s grip on world oil supply.
   The Organisation of the Petroleum Exporting Countries has to weigh the added production of the countries against the political fallout of admitting some regimes cold-shouldered by the West, sources said.
   The oil cartel also decided to keep its official crude output at a 25-year high of 28 million barrels a day, Qatar’s Energy Minister Abdullah bin Hamad al-Attiyah said.
   The decision was to ‘roll over’ current production, Attiyah told reporters as he emerged from a meeting of the 11-nation group. Venezuela’s Oil Minister Rafael Ramirez confirmed that there would no change to the cartel’s output.
   OPEC’s current president, Nigerian oil minister Edmund Daukoru, has already invited the governments of Angola and Sudan to join the cartel as a way of lending greater stability to the world oil market.
   Both countries said they were considering the proposal as ministers of the 11-nation OPEC discussed the topic informally at their latest talks in the Venezuelan capital.
   ‘Now we will have to await the formal applications, (for OPEC) to give an answer,’ Venezuelan Energy Minister Rafael Ramirez said after the meeting.
   ‘The political will is the most important thing. And it has been expressed (by those countries),’ he said.
   In a fiery speech to the OPEC ministers, Venezuelan President Hugo Chavez said the cartel was an ‘anti-imperialist’ group
   that should expand its membership and so hasten the ‘collapse’ of the US ‘empire.’
   ‘OPEC is desperate to get more countries in because it realises that its control of the world oil market and its prestige is eroding,’ commented Phil Flynn, energy analyst with Alaron Trading in Chicago.
   ‘But as for Sudan, that really risks irritating China, which
   has spent aggressively on developing its oil interests there,’ he added.
   Ecuador was previously a member of the cartel but pulled out in 1992, after struggling to meet its official oil output quotas. Gabon withdrew for the same reason in 1995. The last country to join OPEC was Nigeria, in 1971.
   Delegates said the entry of Angola and Sudan was being taken more seriously by OPEC heavyweights such as Saudi Arabia than that of Ecuador, which appeared to be more a hobby horse for Venezuela, now OPEC’s only Latin American member.
   Chavez also called for Bolivia, which has minimal crude reserves but is a large producer of natural gas, to be given observer status at OPEC.
   The entry of Angola and Sudan would have only a marginal impact on OPEC’s output at first, taking its share of world oil supply from 40 per cent to 43 per cent. But both countries are ramping up their production fast.
   Angola’s oil output is on track to reach two million barrels per day (bpd) during 2007, narrowing the gap with Nigeria, which normally pumps 2.6 million bpd for export.
   Sudan is now producing about 286,000 barrels a day, well below OPEC’s smallest producer Qatar, which pumped almost 800,000 bpd on average in 2005. But it plans to nearly double that to 500,000 bpd by the end of this year.

The European Union Friday announced it would grant the African, Caribbean and Pacific group of states (ACP) some 22 billion euros (28 billion US) in development aid between 2008 and 2013.
   The agreement was reached at the ACP-EU council of ministers meeting in Papua New Guinea’s capital Port Moresby, officials said.
   EU director general for development, Stefano Manservisi, hailed as a success the talks which brought together representatives from some of the poorest countries on earth.
   He said the two-day meeting not only brought agreement on the aid package but demonstrated the strong political links between Europe and the 77 ACP nations.
   ‘I think that the outcome of the joint council was a big success,’ he told AFP via telephone from Port Moresby.
   ‘The success was in terms of money but (also) in terms of renewing partnerships.’
   Manservisi said Europe recognised the growing importance of the Pacific, home to some of the world’s tiniest and most remote states, particularly because of their wealth of natural resources and biodiversity.
   ‘Our understanding is that the importance of the Pacific group will only increase,’ he said. ‘Globalisation makes, in any case, distances much smaller.’
   The EU, which presented its first ever formal strategy on EU-Pacific relations at the meeting, has earmarked some 500 million euro for the region over the next six years, he said.
   The money will go to the 15 Pacific states which are members of the ACP—the Cook Islands, Fiji, Kiribati, the Marshall Islands, Federated States of Micronesia, Nauru, Niue, Palau, Papua New Guinea, Samoa, Solomon Islands, East Timor, Tonga, Tuvalu and Vanuatu.
   Manservisi said that the issue of China and Taiwan, rivals which are vying for the political allegiances of small states particularly in the Pacific, was not discussed at the meeting.
   However he added: ‘We are looking, in Europe, with increased interest at this.’
   He said there were concerns that the competition between the Asian rivals could lead to commercial agreements which did not adequately protect Pacific countries’ natural resources.

Asia-Pacific countries made an urgent call Friday for progress in deadlocked talks aiming for a deal this year to free up global trade, with a key deadline fast approaching.
   Asia Pacific Economic Cooperation (APEC) trade ministers meeting in Vietnam said crucial new rules needed to be agreed by late June in the so-called Doha round of talks on cutting tariffs, subsidies and other trade barriers.
   The ministers said in a statement they ‘strongly reaffirm our economies’ commitment to the multilateral trading system and to a successful conclusion of the WTO Doha Development Agenda negotiations by the end of 2006.’
   They pushed for lower tariffs, saying ‘a strong market access result, among others, is a prerequisite for successful conclusion of this round.’
   The World Trade Organisation’s Doha talks launched in the Qatari capital in 2001 have stalled, with the United States and European Union accusing each other of making too few concessions, especially in the contentious farm sector.
   Developing nations led by Brazil and India want both to make greater cuts, arguing that free and fair rules in agriculture would help them trade their way out of poverty if rich countries stopped propping up their own farm sectors.
   APEC trade ministers reaffirmed their commitment to ‘breaking the impasse in the agriculture negotiations’ and called for ‘urgent action’ this month.
   ‘Each of us is ready to contribute to the end of June milestone by supporting strong formulas that deliver meaningful new opportunities for our economies to prosper and develop,’ the ministers said.
   In agriculture, APEC’s 21 members said they would ‘make effective cuts and disciplines in trade-distorting domestic support and have a range of numbers on the table.’ They also agreed to eliminate all export subsidies by 2013.
   The 149 members of the Geneva-based WTO, whose head Pascal Lamy was at the Ho Chi Minh City meeting, aim to conclude the talks this year.

The Big Three US automakers’ reliance on trucks and sport utility vehicles (SUVs) to drive profits hit another pothole in May as consumers switched to more fuel-efficient passenger cars and cross-utility vehicles.
   Asian automakers, which offer a wider range of more fuel-efficient vehicles, continued to post sales and market share gains.
   With high gasoline (petrol) prices eating away at sales of trucks and large SUVs, Ford Motor Co. took the offensive Thursday by offering customers free gasoline for a year along with zero per cent financing on vehicle purchases.
   The automaker offered customers a gift card for 1,000 dollars to be used on gasoline which it estimates will cover most bills through the end of the year.
   Ford’s ‘Drive on Us’ incentive follows a gasoline ‘price-cap’ deal rival General Motors Corp. offered some customers in Florida and California. Car buyers were offered pre-paid gasoline cards that would compensate them if pump prices exceeded 1.99 dollars per gallon.
   That deal did little to boost GM sales, however.
   GM posted Thursday a 16 per cent decline in demand in May from a year ago, ending at 345,157 units. Passenger car demand was lower by 19 per cent at 129,905 units, while truck sales were off by 13 per cent to 215,252 units.
   GM’s lack of fresh products on the car side of the business added to the pain, the automaker said.
   ‘This was a challenging month for us,’ Paul Ballew, GM’s director of global market and industry analysis, told reporters on a conference call.
   He said demand for some traditional truck-based SUVs, particularly the Chevrolet Trailblazer and GMC Envoy, were running at nearly half the pace of a year ago.
   ‘These categories were experiencing significant downward pressure.’
   The story was similar at Ford, where sales were off 1.9 per cent from May 2005 at 278,546, after strong car sales were unable to offset a steep drop in demand for trucks and SUVs.
   Truck sales fell 6.6 per cent to 170,298 units while passenger car sales climbed 6.4 per cent to 108,248 on the continued success of the Ford Fusion, Mercury Milan and Lincoln Zephyr sedans, as well as the Ford Mustang and Focus.
   George Pipas, manager of US sales analysis at Ford, said buyers of the automaker’s new sedan family were opting for more fuel-efficient four-cylinder models during the month, as more than 55 per cent of the cars were sold, up nearly 10 per cent from April.
   ‘This is an indication of carbuyers’ interest in fuel economy when they consider their purchase,’ Pipas told reporters during a conference call. ‘Ford Focus sales were over 20,000 in the month of May, the first month we have gone over 20,000 since last July.’
   German-US group DaimlerChrysler said its US sales fell eight per cent in May to 212,882 units, with year-to-date sales running one per cent lower at 1,037,733 vehicles.
   The group’s US-based Chrysler unit reported an 11 per cent drop in sales, to 191,261 units, with year-to-date sales running three per cent lower at 943,660 units.

Business leaders here Thursday united to launch the first ever business alliance against chronic hunger at the ongoing World Economic Forum (WEF) African summit.
   ‘Business can play an important role in addressing the root causes of chronic hunger,’ said William Hickey, Chief Executive Officer of Sealed Air Corporation. ‘We are ready to commit our experience and expertise to help build solutions to this problem.’
   Diverse groups of business leaders, politicians and representatives from civil society have pledged to work together to create innovative and scalable market- based solutions to the persistent problem of chronic hunger in Kenya.
   Diego Bevilacqua, Group Vice-President of Africa, the Middle East and Turkey for Unilever, noted that Unilever can source from farmer cooperatives, increase access to nutritious foods and conduct information campaigns on health and hygiene.
   ‘By combining our knowledge and interests with those of our partners, we can catalyze concrete actions to reduce chronic hunger and poverty in Kenya,’ he said.
   Kenya’s hunger levels worsened considerably this year due to severe drought. The Kenyan government strongly supports the initiative.
   ‘We welcome this partnership and believe it will strengthen our ongoing efforts to meet the urgent food and nutrition needs of Kenyans,’ said Romano Kiome, Permanent Secretary to Kenyan Ministry of Agriculture.
   The alliance will focus its initial efforts on west Kenya’s Siaya District, the poorest one with 64 per cent of its inhabitants living below the poverty line of one US dollar per day and only 23 per cent access to safe drinking water.
   Participating companies discussed specific actions they can take in the district and will evaluate the business case for both local entrepreneurs and larger-scale companies to engage in these opportunities before convening in Nairobi in early September.

Prime Minister Abdullah Ahmad Badawi has said he is committed to making Malaysia a developed nation by 2020 despite doubts the goal is achievable, a report said Friday.
   ‘Don’t question my capacity to transform Malaysia into a developed nation by 2020,’ Abdullah said in a speech, according to the state Bernama news agency.
   In May Abdullah unveiled the latest in a series of five-year development plans designed to make Malaysia the world’s first developed Muslim nation.
   The Ninth Malaysia Plan targets economic growth of 6.0 per cent until 2010 and is aimed at succeeding where eight others have failed—to bridge a chasm between rich urbanites and poor rural villagers.

Fish and seafood worth more than $800 million are smuggled from Russia to Japan every year as part of a massive criminal operation, an official from Russia’s border guards said Thursday.
   ‘Smuggled fish and seafood worth more than $800 million (624.2 million euros) are delivered to Japanese ports every year,’ the official was quoted by ITAR-TASS news agency as saying.
   The official said Russian border guards, which are under the control of the country’s FSB security agency, had shut down 130 criminal groups dealing in smuggled fish and seafood in 2005 alone.

Adobe may sue Microsoft
Microsoft Corp said it expected Adobe Systems Inc to file an antitrust suit in Europe after talks to use Adobe’s technology broke down this week, according to the Wall Street Journal. The two companies have been in discussions over the use of Adobe’s Portable Document Format, or PDF, within Microsoft’s Office suite of applications, the Journal reported, quoting Microsoft General Counsel Brad Smith. Adobe wants Microsoft to remove the feature and offer Adobe’s technology separately for a fee.
— Reuters

Mittal pressures Arcelor to resume talks
Mittal Steel, the world’s largest steelmaker, pressured its takeover target Arcelor to resume talks on a friendly deal by giving its business plan to its defiant rival. Arcelor Chairman Joseph Kinsch has said he would agree to meet steel magnate Lakshmi Mittal if the latter agreed to give him a detailed business plan. Arcelor says it needs Mittal’s business plan to estimate the value of its suitor’s shares. Mittal’s announcement comes as Arcelor faces a potential shareholder revolt after unveiling a 13 billion euro ($16.6 billion) deal with a white knight, Russian steelmaker Severstal.
— Reuters

Boeing lands $5.8 billion order
Boeing Co said unnamed buyers have ordered $5.8 billion worth of single-aisle planes and widebody aircrafts this week, making it one of the biggest new plane orders week. Buyers ordered 20 widebody 777s, nine single-aisle 737s and three 747s, according to the Wall Street Journal, which first reported it on its Web site. The 777s, with an average list price of $216 million each, are among the most expensive of Boeing’s products, the Journal reported. On Thursday, Cathay Pacific Airways Ltd. said it placed orders for two more 777 aircrafts.
— Reuters

S Korea’s GDP
growth revised
South Korea’s central bank Friday revised the country’s first-quarter growth rate downwards by 0.1 per cent points to 6.1 per cent from a year earlier, citing greater-than-estimated service imports in March. The revised figure, however, confirms the highest quarterly growth rate since the fourth quarter of 2002 when the economy expanded 7.5 per cent, he said. The Bank of Korea issues quarterly GDP growth rates based on actual performance of the first two months of every quarter and an estimated performance of the last month.
— AFP