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The Bangladesh Export Processing Zone Authority has finally taken steps to set up a central effluent treatment plant in the Chittagong Export Processing Zone after 24 years of its operation.
   Absence of such plant, industrial units in the largest export processing zone of the country are forced to dump thousands of tonnes of wastes into Karnaphuli and the Bay of Bengal resulting a massive water and environment pollution.
   The BEZPA authority would set up Tk 350 crore effluent treatment plant inside the CEPZ with financial assistance from the Japanese government, sources in the organisation said.
   ‘The proposal has been finalised and we are now waiting for the approval of the Executive Committee of National Economic Council,’ the chief engineer of the BEPZA, SS Kibria told New Age on Monday hoping that the ECNEC would approve the project as the major portion of the fund would be provided by Japan.
   The Japanese government agreed to provide 95 per cent of the total cost while the rest five per cent would be given by the Bangladesh government, he informed.
   The authority submitted the project proposal before the ECNEC in October and it might be approved within one or two months, said a BEPZA official.
   The BEPZA failed to set up effluent plant in the CEPZ although it had allocated five acres of land for the plant according to the master plan when the EPZ went in operation in 1983.
   Due to fund shortage the authority failed to set up the plant, said one official.
   The authority could have earned a handsome amount of revenue had it used the land in other purposes, insiders said.
   A leading industrial unit operating in the zone wanted to use the land as playground on lease but the authority did not endorse the offer, they said.
   ‘As the ETP project is in our master plan we did not take any move to use the land otherwise,’ a top official of the CEPZ told New Age.

The market capitalisation dropped significantly on the bourses in the last two days as downslide in the stock market continued amidst the on-going crackdown on the corruption suspects.
   The Dhaka Stock Exchange lost Tk 519.24 crore in the last two days to stand at Tk 37,513.55 crore on Monday.
   The market capitalisation on the Chittagong Stock Exchange dropped by Tk 350.20 crore during the period to Tk 30,318.04 crore.
   Analysts and insiders said the crackdown on alleged corrupts and financial frauds prompted big-scale investors to take cautious move.
   The rush of the small investors also slimmed following the downtrend of the market, they said.
   Stocks lost on Monday for the second consecutive due to selling pressure.
   The general index of the DSE lost 16.72 points or 0.95 per cent to close at 1752.51 on Monday, while the blue chips index, shed 3.19 points or 0.22 per cent to close at 1448.11.
   The CSE selective categories index lost 13.65 points or 0.52 per cent to close at 2611.61 on Monday. The CSE30, the blue chips index, however, gained 0.90 points or 0.03 per cent to close at 3404.46.
   Turnover on the DSE increased to Tk 65.56 crore from the Sunday’s total of Tk 58.98 crore.
   The CSE turnover increased to Tk 12.36 crore from Tk 11.65 crore.
   Most of the securities ended down on Monday. Of the total 206 issues traded on the DSE, 145 declined, 42 advanced and 19 remained unchanged.
   A total of 98 issues were traded on the CSE. Of them, 61 issues declined, 26 advanced and eleven remained unchanged.
   The Dhaka Electric Supply Company topped the turnover leaders on the DSE with total transactions of Tk 8.32 crore following its takeover of the sales and distribution of electricity in Tongi area.
   Two IT companies, Agni Systems and In Tech Online, stepped into the top ten turnover list of the prime bourse. The share prices of the companies also registered substantial gains.

Economist Wahid Uddin Mahmud Monday said the scope and pattern of the micro-credit programme had changed in recent years to benefit the marginalised community.
   ‘The scope and pattern of the micro-credit has expanded. Now it should be called micro and medium scale credit,’ Mahmud said, as he opened a four-day micro-credit fair.
   Palli Karma Sahayak Foundation organised the fair in the city’s Bangladesh-China Friendship Conference Centre to promote products made by the small loan recipients.
   Mahmud, a former Dhaka University professor, said the small loan receivers should expand their businesses from local to national level.
   He said the entrepreneurs should change their mindset to use the small loan in a bigger perspective
   Small loan receivers usually do small businesses such as poultry farming, rearing of goats or making handicrafts.
   Mahmud hoped that from now on the focus of the small loan would be ‘production’.
   He felt a strong support from the government as well as the PKSF was needed to help market the products of the entrepreneurs.
   In an ambitious note, Mahmud however said the small entrepreneurs have scopes to eye even international market.
   Acting managing director of PKSF Mosharaf Hossein Khan said currently the small loan providers even give Tk 3 lakh to a client without any collateral.
   A total of 82 organisations are showing their products in 131 stalls in the fair.
   The fair will remain open from 10:00am to 9:00pm everyday.
   On March 7, Chief Adviser Fakhruddin Ahmed will hand over award to the best three organisations participating in the fair.
   On March 8, PKSF will give a reception to Nobel Peace laureate Muhammad Yunus.
   PKSF has started the loan programme for the micro entrepreneurs in 2002. Bangladesh Bank has provided Tk 100 crore to form the PKSF fund.

Global banking giant HSBC Holdings announced on Monday a 35.5-per cent surge in bad debts during 2006 owing to increased defaults on home loans by high-risk US borrowers.
   HSBC, the world’s third-biggest bank, said that total impairment charges, or loans to customers that were written off, rose to 10.573 billion dollars (8.052 billion euros) last year.
   That dented net profit growth in 2006, which rose just 4.7 per cent to 15.789 billion dollars year-on-year, compared with growth of 17.0 per cent in 2005.
   Putting aside its problems in the United States, HSBC announced also on Monday a tie up with Bangalore-based Canara Bank and another Indian lender to set up a life insurance business.
   The price of shares in HSBC rose slightly in London trading, as investors welcomed the in-line results and cheered an 11-per cent increase to the bank’s full-year dividend.
   ‘I guess some people had expected something even worse,’ said Magnus Matthewson, an analyst at Hichens, Harrison stockbrokers in London.
   HSBC meanwhile said in its earnings statement: ‘The major credit issue affecting the group in 2006 arose in the US.’
   It added that a slowdown in the rate of growth in US house prices accelerated defaults among higher-risk borrowers.
   ‘Deterioration was marked in the more recent loans, as the absence of equity appreciation reduced customers’ options for refinancing,’ HSBC said.
   The group forecast that higher repayment costs over the next few years for borrowers with variable rate mortgages ‘will lead to further delinquency.’
   HSBC had warned last month that its 2006 bad debt charge would be 20 per cent above market expectations, blaming a surge in defaults among mortgage customers at its troubled US subsidiary HSBC Finance.

Japan and the United States on Monday downplayed recent turmoil on global financial markets and said the world’s two largest economies remained solid.
   US Treasury Secretary Henry Paulson was in Japan on the first stop of an Asia tour, the former Goldman Sachs chief executive’s third visit to the region since he became Washington’s economic pointman in July.
   Although Paulson’s visit has been planned for some time, it has been given more urgency following recent volatility on world markets, with the dollar falling to a near three-month low against the yen Monday.
   Paulson, speaking after dinner with Japanese Finance Minister Koji Omi, said he believed the yen should reflect market forces.
   ‘I mentioned that the yen is market-determined, the rates determined in an open marketplace, as it should be,’ Paulson told reporters.
   Paulson also hailed that Japan was finally coming out of its nearly decade-old problem of deflation.
   Less than a month ago, Paulson said the yen had fallen to a nearly 20-year low on a trade-weighted basis against other major currencies. Germany has led criticism of the weak yen, which makes Japanese exports more competitive.
   The stronger yen helped pull down the Tokyo market for the fifth straight session Monday. The key Nikkei index lost 3.34 per cent, closing at the lowest level for more than two months.
   Omi, however, said that he and Paulson were not unduly worried.
   ‘I am not concerned about it because market mechanisms are functioning,’ Omi told reporters.
   ‘We agreed that the economic fundamentals are strong in Japan and the United States,’ Omi said. ‘We confirmed our shared understanding that the market should reflect the fundamentals.’
   Global markets have been spooked since last week by sharp falls on the booming Chinese stock market and a warning by former Federal Reserve chairman Alan Greenspan about possible recession in the United States.
   The Japanese market has also been hit by the dumping of so-called ‘carry trades’ whereby investors borrow yen at rock-bottom interest rates to fund higher-yielding investments outside Japan.
   Japan on February 21 lifted its interest rates a notch to 0.50 per cent—still the lowest of any major economy—amid signs that deflation is finally behind it.
   Analysts say that speculators now appear to be scaling back riskier investments in light of the recent financial market turbulence.
   ‘It’s a good chance for (Paulson and Omi) to assess the impact and what role it has played in the current financial market fluctuations,’ said Mizuho Investors Securities senior strategist Masatoshi Sato.
   Paulson also met with Prime Minister Shinzo Abe to discuss Japan’s economy, which is recovering from its doldrums in the 1990s to post its longest expansion since World War II.
   ‘We had valuable exchanges of views on economic policies and other issues,’ Abe told reporters.
   Paulson meets Tuesday with Tokyo Stock Exchange president Taizo Nishimuro and Bank of Japan governor Toshihiko Fukui before heading on to South Korea.

Integrated service system in containerised cargo operation at container terminal of the Chittagong Port is going to be launched from today on an experimental basis under private management.
   Port officials said such a major step in privatising the port services has been taken to accelerate the container handling as well as to reduce cost in container operation.
   Saif Powertec Limited, a private company now only involved in the shipment and discharging of container to and from ships at the terminal, has been given the entire jobs as terminal operator under integrated service system. The operation under the system ranges from loading and off-loading of containers at ships and reaching those to the delivery point, the officials said.
   The private company will conduct the job by engaging port employees and others as per the requirements. It will also operate the sophisticated container handling equipment owned by the CPA like gantry cranes, rubber-tyred gantry cranes and straddle carriers.
   An agreement to this effect between the CPA and the company has already been finalized and is likely to inked soon, they said.

Bangladesh Bank has asked the commercial banks not to hamper normal business operations of enterprises while implementing the National Board of Revenue directive to attach accounts of the suspected tax-dodgers.
   ‘We’ve asked the banks to take measures so that business operations of the enterprises does not suffer,’ governor Dr Salehuddin Ahmed told reporters at the Bangladesh Bank Sunday.
   Replying to a question, he explained that the NBR directive might have called for attaching the accounts of a director of an enterprise, but that does not mean the company account will be attached.
   NBR sources said the revenue authority has so far asked commercial banks to attach accounts of 400-500 people, including former ministers, top politicians and so-called business moguls, on suspicion they have evaded huge amounts in taxes.

Malaysia’s health minister called Monday for a ban on fast-food commercials during children’s television programmes to control rising obesity.
   Health Minister Chua Soi Lek said fast-food restaurants would also be required to detail the calorie content of their products under the recommendations to be sent to the cabinet.
   Calling fast food a ‘silent killer’, Chua said the proposal was part of the ministry’s plan to control rising cases of obesity, diabetes and heart-related diseases.
   Chua has said 37 per cent of Malaysia’s almost 27 million people are obese, a rise from only 20 per cent a decade ago.
   He announced the proposal after meeting representatives from McDonald’s, KFC and Burger King.

The Securities and Exchange Commission Monday served show cause notices to three companies and fined one for violating rules.
   The action was taken against Raspit Data Management and Telecommunications, Rahim Textile Mills, Sajib Knitwear
   and Garments and Pharmaco International, SEC officials said.
   Directors, managing directors and company secretary of Raspit Data and Rahim Textile were served notices for
   failure to submit half-yearly financial statements. Sajib Knitwear was given the notice for non-compliance of audited financial statements for the last fiscal.
   The punitive action was taken against Pharmaco International. Its managing director AKMA Matin, directors Rashida Matin, Zamir Uddin, AKMA Batin and AKMA Basit were fined Tk one lakh each for non-compliance of securities laws.

Finnish company Perlos, which makes mobile phone casings for Nokia, said on Monday it would end production with the loss of 1,132 jobs, as part of a bid to return to profitability.
   ‘The company will discontinue all production operations in Finland, closing its two facilities in North Karelia by the autumn of 2007 at the latest,’ the group said in a statement.
   Perlos said it would ‘also cut overlapping functions in the organisation, which will lead to personnel reductions in other functions in Finland as well,’ where it employs a further 200 employees.
   The Finnish job losses were included in some 4,000 redundancies Perlos announced in January in Europe, Asia and North and South America for 2007, representing a third of its workforce.
   Perlos has been hit by falling demand from Nokia, traditionally its most important customer, and fierce competition from Asian competitors. The group has said it intends to make savings of 100 million euros (130 million dollars) a year from 2007.
   The group reported an operating loss of three to four million euros in the fourth quarter of 2006 and a loss of 32 to 33 million euros for the full-year.
   At the end of 2006, Perlos had 12,944 employees, including 5,715 temporary workers.

China is likely to allow foreign companies to issue yuan-denominated bonds on domestic markets this year, state media said Monday, citing a top central bank official.
   Wu Xiaoling, the vice governor of the People’s Bank of China, said the central bank was in favor of foreign companies and international organisations issuing yuan-denominated bonds in China, the China Securities Journal reported.
   Supervisory authorities would not reject such applications from institutions registered in China as long as the companies were engaging in legitimate business operations, Wu said.
   Foreign companies and international organisations currently must transfer foreign exchange into China from abroad when they need capital for domestic investment purposes.
   Currently the World Bank’s International Finance Corp and the Asian Development Bank are the only foreign entities allowed to issue yuan-denominated bonds in China.
   By allowing foreign companies to raise funds within China would also benefit the development of China’s economy, Wu added.
   Meanwhile, she confirmed that preparations were under way to set up the State Foreign Exchange Investment Company, a company that is expected to be in charge of investing some of China’s enormous foreign exchange reserves.
   She said that Central Huijin, the central bank’s investment arm, would be part of the new company.
   She also downplayed market concerns that the new company would exert a large impact on the US Treasury market, while acknowledging that part of China’s increased forex reserves would be invested in non-US-dollar assets.
   Analysts estimated the share of US-dollar Treasury bonds is now 60 per cent of China’s forex reserves

Growth in the service sector of the 13 countries sharing the euro eased more than expected in February, according to a survey released Monday.
   The eurozone purchasing managers index (PMI) for the service sector, compiled by the research group NTC Economics, fell to 57.5 points in February from 57.9 in December.
   Private economists had forecast that the survey would fall to 57.7 points after reaching a six-month high in January.
   Despite the lower level of activity, the vast sector continued to show resilience with the 44th consecutive month of growth, which is indicated by a figure over 50.
   Weaker domestic demand weighed on growth in new business, although the slowdown was likely to be only temporary since expectations of business activity growth rose for the fourth month, NTC Economics said.
   Economists said that the lower level of overall activity was only a minor setback and that the sector was still enjoying strong growth.
   ‘Although the business activity index edged back in February and new business growth lost some buoyancy, the eurozone service sector purchasing managers’ survey nevertheless indicates robust activity,’ said Global Insight economist Howard Archer.

Genting International found some relief amid a broad market sell-off on Monday after the company said it was taking sole control of a casino project in Singapore and pulling out of a Macau tie-up with gaming tycoon Stanley Ho.
   Genting said Sunday it was buying the 25 per cent stake of its sister firm and minority partner Star Cruises in the project to build a 3.4 billion-dollar integrated casino resort on Singapore’s Sentosa island.
   The Singapore-listed Malaysian gaming firm, which owned 75 per cent of the consortium, also said it would pull out of a Macau hotel project linked to Ho.
   Genting surged in early trade following the news, but fell victim to the sharp falls in the market later in the day.
   It closed at 0.805 Singapore dollars (0.53 US), down 0.025 or 3.0 per cent. However, the fall was slightly better than the 3.13 per cent drop in the benchmark Straits Times Index.
   Star Cruises sought a suspension of trading pending an announcement. It closed at 0.32 US dollars on Friday.
   The Genting and Star Cruises consortium had won a bid last year to build a casino and entertainment complex to be called the Resorts World at Sentosa in the city-state. But a deal which would have given Macau businessman Ho an indirect stake in the Singapore casino project prompted authorities to question the consortium.
   Pressure increased after the Casino Regulation Division of the Singapore’s Ministry of Home Affairs said the Genting-Star Cruises alliance was not sure of getting a casino licence despite winning the bid to build the development.
   The regulator had said it would conduct checks ‘to ensure that the consortium meets the suitability requirements’ before a licence is issued.
   Singapore’s Casino Control Act requires each person associated with the management and operation of the casino to be a ‘person of good repute, having regard to character, honesty and integrity.’

China’s budget deficit will be 245 billion yuan (31.5 billion dollars) in 2007, down 50 billion yuan from last year, Premier Wen Jiabao was to
   tell parliament on Monday, according to a copy of his speech.
   Wen was to say in his work report on the opening day of the annual session of the National People’s Congress that the deficit was in line with the government’s responsible economic measures.
   ‘We need to continue to follow a prudent fiscal policy,’ Wen was to say, according to the speech.

A French trade union threatened on Monday to halt production of aircraft by Airbus if the board did not redistribute cutbacks between Germany and France.
   The secretary general of the Force Ouvriere (Worker Strength) union within Airbus, Julien Talavan, said in an interview with the La Tribune business newspaper that a decision to increase the amount of work to be done in Germany on the single-aisled A320 aircraft was ‘unacceptable’.
   This was because it reduced work available for the Toulouse factory in France by 20 per cent.
   ‘We are ready to block production,’ he said.
   Force Ouvriere is the biggest union in Airbus France and Talavan said that he wanted to discuss the ‘industrial sharing’ with the head of the company, Louis Gallois.
   Two leading candidates in the French presidential election campaign, to be held in April, were to visit the facilities here on Monday: Francois Bayrou of the centrist UDF party and Nicolas Sarkozy of the centre-right UMP.
   The Socialist candidate Segolene Royal is expected on Tuesday, the day of a widespread strike by staff of Airbus in France against the loss of 10,000 jobs and streamlining of production announced last week.
   Talavan said: ‘We are going to meet the main candidates in the presidential election.’

HSBC unit Hang Seng Bank said its 2006 net profit rose 6.1 per cent year-on-year to 12.04 billion Hong Kong dollars (1.54 billion US dollars) on the back of a robust performance by its personal financial services and commercial banking operations.
   Hang Seng Bank chairman Michael Smith said the bank’s 2006 results were supported by a strong economy in Hong Kong, distinguished by a buoyant stock market, ample liquidity and a benign credit environment.
   ‘Our personal wealth management business achieved good growth in investment services, insurance and private banking,’ Smith said in a statement.
   It said commercial banking performed well, underpinned by increases in customer advances and the development of corporate wealth management services.
   For the period, commercial banking operating profit, excluding loan impairment charges, rose 21.5 per cent to 2.0 billion dollars, while operating profit from personal financial services, excluding loan impairment charges, grew 5.4 per cent to 7.84 billion dollars.
   The bank’s mainland China business, including its share of profit from Industrial Bank Co Ltd, contributed 6.1 per cent of the total profit before tax, compared with 4.5 per cent in 2005, bringing it closer to its target of 10 per cent by 2010.
   The bank’s mainland business recorded pretax profit of 897 million dollars, up from 616 million dollars a year earlier.
   ‘On the mainland, we will continue with our two-pronged approach of organic growth and close collaboration with Industrial Bank,’ Smith said, adding that the bank aims to expand its mainland business to more than 2,000 staff and more than 50 outlets by 2010.
   Operating profit for 2006 was up 13.6 per cent at 12.58 billion dollars.
   Net interest income stood at 11.69 billion dollars, against 10.80 billion dollars a year earlier.
   The bank declared a fourth interim dividend of 1.90 dollars per share and total dividend of 5.20 dollars a share for 2006, unchanged from a year earlier.

China’s economy will continue to race ahead at a near double-digit rate, analysts said Monday, despite a call by Premier Wen Jiabao’s for a more controlled pace of development.
   Wen set an expansion target of around eight per cent in 2007 — following growth of 10.7 per cent in 2006 — as part of his government’s commitment to pursuing more balanced and sustainable development.
   ‘(We must) avoid seeking only faster growth and competing for the fastest growth,’ Wen told nearly 3,000 delegates assembled in Beijing’s Great Hall of the People for the opening of parliament’s annual full session on Monday.
   But after Wen finished his two-hour speech, economists said the lower target would not be met, highlighting the continued difficulty Beijing faces in reining in the world’s fourth-largest economy.
   ‘There’s no way it will be just eight per cent , but he has to say that,’ said Wang Qian, a Hong Kong-based economist for JPMorgan Chase Bank.
   ‘It’s a way of expressing his point of view that the economy shouldn’t grow too hastily,’ she said.
   Wen has in previous years announced similar economic growth projections, only to see the actual number far exceed the initial target, and he acknowledged that the government’s projection may again not prove accurate.
   ‘Because of changes in the domestic and international economic environments, including the markets, the real growth rate will vary a certain amount from the projected target,’ he said.
   Targets tend to be missed in China because local governments want growth as a means of creating jobs, threatening also the central government’s ambition for growth that is less wasteful and gentler on the environment, analysts said.
   ‘One of the crucial problems with China is that the local governments are more focused on the growth at the cost of pollution,’ said Dong Tao, a Hong Kong-based economist for Credit Suisse First Boston.
   ‘The most difficult part of the policy is how to align the local governments’ incentives along with China’s growth targets, environment protection targets and many other policy targets,’ he said.
   In his call for a more balanced economy, Wen targeted liquidity-fueled investment in plant, equipments and other productive capacity, a major factor in last year’s 10.7-per cent growth.
   ‘The focus of this work is to keep the scale of fixed-asset investment and credit under control and to promote overall balance between total supply and total demand,’ Wen said.
   Analysts said limiting growth to eight per cent would also prove hard because consumer spending was expected to gradually heat up as social safety improved and Chinese felt less of a need to save for emergencies and old age.
   ‘The government is going to expand its spending on issues such as social security and environment protection,’ said Sun Mingchun, a Hong Kong-based economist with Lehman Brothers.
   The regularity with which growth objectives are missed in China has led some observers to call for an end to number targets—seen by some as a relic of the planned economy—and a shift to more comprehensive policy goals.
   To some extent, the government may already be doing this, at least in private, according to Chen Xingdong, a Beijing-based economist with BNP Paribas.
   ‘I believe the government doesn’t really pay that much attention to the growth target as such,’ he said.
   ‘It’s much more interested in issues such as keeping the deficit low and maintaining a stable monetary policy.’

The European Central Bank is set to raise its inflation and growth forecasts for the eurozone next year in a move that may pave the way for additional interest rate rises, the Financial Times Deutschland reported on Monday.
   So far, the ECB has been pencilling in an inflation rate of 1.9 per cent for 2008, in line with its definition of price stability. But when the bank publishes its updated forecasts later this week, the inflation forecast will be increased slightly, FT Deutschland said, without revealing its sources.
   The ECB defines price stability as annual inflation rates close to but just below 2.0 per cent.
   The ECB is also set to raise its growth forecast for the 13 countries that share the euro, the newspaper continued.
   At present, the bank expects growth in gross domestic product (GDP) of 2.2 per cent for this year and 2.3 per cent next year.
   Any upward revision in the growth and inflation forecasts for the single currency area would provide further ammunition for the ECB to raise its key interest rates beyond the widely expected quarter-point increase this week.
   The ECB has raised its benchmark ‘refi’ refinancing rate six times since December 2005. The last move was in December 2006, which brought the refi to a five-year high of 3.50 per cent.

Sanyang Industry Company, a motorbike and auto manufacturer in Taiwan, said Monday it will invest 70 million US dollars in Vietnam for commercial vehicle production.
   ‘The 70 million dollars is the preliminary plan. It is possible we will pour more funds to Vietnam, encouraged by the country’s growing economy after its entry into the World Trade Organsation,’ a company spokesman said.
   Sanyang is scheduled to start construction of the plant facilities this year, the spokesman said, but added other details are not immediately available.
   Currently, Sanyang operates two plants in southern Vietnam making motorbikes and engines.
   The facilities roll out 300,000 motorbikes a year with most of them sold locally.
   Apart from Vietnam, Sanyang also invests in China and Indonesia making motorbikes and components.
   China’s inflation rate to remain below 3.0 per cent in 2007: Wen Agence France-Presse . Beijing China’s inflation rate should remain below three per cent in 2007, Chinese Premier Wen Jiabao told parliament on Monday.
   ‘The overall increase in consumer prices should stay below three per cent,’ Wen said as he delivered his work report on the opening day of parliament’s annual session.
   China’s consumer price index rose 1.5 per cent last year. In January, it rose 2.2 per cent from a year earlier.

US Treasury Secretary Henry Paulson arrived in Japan Monday on the first leg of an Asian tour overshadowed by the recent turmoil on global financial markets.
   It is Paulson’s third official trip to Asia since the former Goldman Sachs chief executive became the top US economic pointman last July, and his first to Japan where he started his visit with a call on Prime Minister Shinzo Abe.
   ‘We talked about the economy and economic reform,’ the US Treasury chief told reporters as he emerged from Abe’s official residence, before heading off for dinner with Finance Minister Koji Omi.
   Although Paulson’s visit has been planned for some time, it has been given added impetus following recent volatility on world markets, with the dollar falling to a near three-month low against the yen Monday.
   ‘Paulson will use the trip to exchange views on the recent instability of global financial markets,’ said Mizuho Investors Securities senior strategist Masatoshi Sato.
   Paulson on Sunday tried to reassure investors the US economy is robust, despite last week’s stock market plunge.
   ‘I’m feeling good about the US economy. Anybody that has watched markets knows that they don’t always over time reflect economic fundamentals and markets never move in any direction forever in a straight line,’ he told ABC television.
   Asian stock markets came under fresh selling pressure on Monday. Tokyo’s Nikkei index lost 3.34 per cent , closing at the lowest level for over two months on concerns about the health of global markets and a stronger yen.
   During his meeting with Omi, Paulson is also expected to discuss the impact of so-called ‘carry trades’ whereby investors borrow yen at rock-bottom interest rates to fund higher-yielding investments outside Japan.
   Analysts say that speculators now appear to be scaling back riskier investments in light of the recent financial market turbulence.
   While no one really knows the true size of the yen carry trade, they say, there are concerns that if the credit bubble bursts it could roil markets.

Asian share prices posted heavy losses Monday as players scaled down their exposure to risky investments after the recent global turmoil.
   Dealers said that the dollar’s slump to near three-month lows against the yen highlighted an unwinding of so-called yen carry trades by speculators who have binged on Japan’s cheap credit to fund investments elsewhere.
   Investors in the region were also keeping a close watch on the opening of the Chinese parliament’s annual full session for any fresh initiatives to try to rebalance the nation’s fast-growing economy.
   But dealers said a speech by Premier Wen Jiabao, who set a national economic growth target for 2007 of about eight per cent, failed to provide fresh trading leads, leaving the Shanghai Composite Index to end down 1.63 per cent.
   Last week investors in Chinese stocks endured a roller coaster ride as the key index in Shanghai recorded its sharpest single-day decline in 10 years amid fears the government would slap capital gains taxes on securities investments.
   This, and the outlook for the US economy, triggered a massive sell-off in volatile trade around the world which now appears to be entering a second week.
   On the day, the Tokyo benchmark closed down 3.34 per cent. Shares closed down 2.29 per cent in Sydney and dropped by 4.54 per cent in Manila, by 4.0 per cent in Hong Kong, by 2.71 per cent in Seoul, and by 3.74 per cent in Taipei.
   Kuala Lumpur was the worst on the day with a 4.64 per cent tumble, while Singapore slumped 3.13 per cent and Jakarta shed 3.48 per cent. Bangkok was closed for a public holiday.
   TOKYO: Share prices slumped by 3.34 per cent, mirroring heavy losses across Asia fuelled by concerns about the health of global markets and a stronger yen.
   Dealers said exporter shares suffered after the dollar sank to near three-month lows against the yen as speculators scaled back riskier investments funded by cheap Japanese credit.
   That added to nervousness over fresh losses seen on Wall Street on Friday and across Asia at the start of the week.

British banking giant HSBC Holdings on Monday tied up with Bangalore-based Canara Bank and another Indian lender to set up a life insurance business, entering a market fuelled by rising incomes and the absence of a social security system.
   State-owned Canara will hold a 51 per cent stake in the venture, initially capitalised at two billion rupees ($45m), with HSBC taking 26 per cent and New Delhi-based Oriental Bank of Commerce the rest, Canara’s general manager S Jayararam told AFP.
   HSBC’s insurance arm agreed to pay a premium of 1.25 billion rupees for its stake, raising the net worth of the proposed insurer to 3.25 billion rupees, under an agreement signed Monday, Jayaraman said. The announcement came as HSBC, the world’s third-biggest bank, announced a 35.5 per cent surge in bad debts that dented net profit in 2006, which rose just 4.7 per cent to 15.789 billion dollars year-on-year.
   HSBC joins firms such as New York Life, Prudential and Allianz in setting up an insurance venture in India, where the market has doubled to more than 20 billion dollars in annual premiums since opened to foreign investment in 2000.
   ‘The insurance penetration rate is still extremely low and there’s a lot of scope for further expansion,’ said Jayaraman, adding the partners had yet to decide on details of the joint venture.
   The venture would have the advantage of marketing to the tens of millions of existing customers the three partners already have in the country.
   India opened up the market to expand coverage and make more funds available for investment in infrastructure such as power plants and roads.
   But only 2.5 per cent of the population has insurance coverage, said the Canara official.
   ‘The market is untapped outside of the metros and smaller cities,’ said Sushmul Maheshwari, chief executive of RNCOS, a market research firm. ‘The awareness about insurance remains very low and outside of the cities people are not serious about getting insured,’ he said. ‘That offers a huge opportunity for insurance companies.’

French hotel group Accor announced a sale and leaseback deal on Monday for 72 hotels in Germany and 19 in the Netherlands.
   Accor is to sell the hotels to property investment group Moor Park Real Estate for 863 million euros (1.13 billion dollars), but continue to operate them under renewable 12-year rent leases.
   The agreement, in the form of a memorandum of understanding, covers Novotel, Mercure, Ibis and Etap Hotel properties representing 12,000 rooms, Accor said.
   Rent on the hotels will be based on an average of 18 per cent of annual revenues, which would have amounted to about 49.5 million euros in 2006, Accor said.

Singapore companies booked more than 470 million Singapore dollars (309.21 million US) in tariff savings last year as a result the country’s free trade agreements (FTAs), Trade Minister Lim Hng Kiang said Monday.
   Since embarking on its first FTA in 2000, the city-state has concluded 11 such agreements worldwide and is in ‘active negotiations’ for 10 more, Lim said in parliament.
   ‘Our FTAs have helped our companies achieve tariff savings of over 470 million dollars in 2006 alone,’ he said.
   Singapore’s trade with the world grew 13 per cent in 2006 over 2005 and is projected to expand between eight and 10 per cent this year, he said.
   The government has signed FTAs with the United States, Japan, Australia and other trading partners.
   Lim reiterated the government’s target for the trade-driven economy to expand between 4.5 and 6.5 per cent this year, slower than last year’s 7.9 per cent annual growth, which was one of the highest in Asia. ‘The global economic growth... is expected to be slower but overall, the external environment is still positive. Domestically, consumption is likely to strengthen, while investments will remain firm,’ he said.
   Inflation is expected to remain in check even with the increase in the goods and services tax, he added.

Taiwan’s consumer price index (CPI) in February was up 1.74 per cent year-on-year on increases in charges of the service sector as the Lunar New Year holidays fell in the month, the government said Monday.
   The February CPI figure was up a seasonally adjusted 0.12 per cent month-on-month at 104.44, the Directorate General of Budget, Accounting and Statistics (DGBAS) said.
   Given a 2001 benchmark of 100, the February CPI growth figure compares with January’s revised 0.35 per cent year-on-year increase and seasonally adjusted 0.47 per cent month-on-month rise.
   The February core price index, which excludes prices of fresh vegetables/fruits, fishery products and energy, was up 1.65 per cent from a year earlier and up 0.99 per cent from January.
   The wholesale price index (WPI) in February rose 6.77 per cent year-on-year and was up a seasonally adjusted 0.52 per cent month-on-month, the DGBAS said.
   In the first two months of this year, the CPI was 1.04 per cent from a year earlier and the core price index up 0.76 per cent from a year ago, while the WPI was up 6.91 per cent year-on-year.

European and Asian shares plunged again on Monday as turbulent trading conditions stretched into a second week, with an expected lower opening on Wall Street likely to add momentum to the global downturn, dealers said.
   Equities began tumbling last week as investors sought to take profits from high stock prices and cut their exposure to risk amid warnings of a strong correction to markets after many indices hit multi-year peaks earlier in the year.
   Investors were spooked last week by sharp falls in Chinese share prices and comments about a possible recession in the United States by former Federal Reserve chairman Alan Greenspan.
   ‘Some sort of consolidation was due and with a background of rising interest rates, the markets were vulnerable, and along came a lot of profit-taking in China and that was enough to kick-start the whole thing,’ said Mike Lenhoff, analyst with Brewin Dolphin Securities in London.
   ‘What we are seeing is the progress of a correction and ... it will run its course when the markets have got to a 10-per cent correction from top to bottom,’ added Lenhoff, who sees the FTSE hitting a low of about 5,800 points.
   World stock markets suffered steep losses of between four and ten per cent last week.
   In European trade on Monday, London’s FTSE 100 index of leading shares tumbled 1.93 per cent to 5,998.00 points, marking the first foray beneath 6,000 since October 9, 2006.
   Frankfurt’s DAX 30 dived 2.36 per cent to 6,447.18 points and in Paris the CAC 40 plunged 1.90 per cent to 5,321.40.
   ‘Losses (on Wall Street) ahead of the weekend break have already taken their toll on Asian markets in early trade and the impact is likely to be significant for European stocks,’ said Matt Buckland, trader at CMC Markets.
   A fresh wave of selling had struck US stocks on Friday at the end of a bad week for global markets, as economic concerns resurfaced and investors retrenched before the weekend.
   On Monday, the Tokyo market extended its losing streak to a fifth trading day, closing down 3.34 per cent at the lowest level for over two months on concerns about the health of global markets and a stronger yen, dealers said.
   Investors in Chinese stocks endured a rollercoaster ride last week as the key index in Shanghai recorded its sharpest single-day decline in 10 years amid fears the government would slap capital gains taxes on securities investments.
   On Monday, the Shanghai Composite Index fell 1.63 per cent to 2,785.31 points.
   ‘It did start with what happened in China,’ Lenhoff said of last Tuesday’s near 9.0-per cent plunge in Chinese share prices.
   ‘All you need is some sort of trigger for a shake-out if markets are vulnerable, which they were anyway because they had risen without any major consolidation since the trauma of last May.’
   However, he added that many investors regarded the current climate as a potential time to snap up shares on the cheap.
   ‘Long term investors are always on the lookout for buying opportunities and they will take the view that valuations in equity markets look okay, and the outlook for economic activity globally is still very good.’
   Other financial markets were roiled by the continued downturn. Crude oil prices dropped about a dollar per barrel on Monday as traders reacted to heavy falls in equities.

The dollar sank to near three-month lows against the yen in Asian trade on Monday as speculators scaled back riskier investments funded by cheap Japanese credit, dealers said.
   They said the Japanese currency benefitted from an unwinding of so-called carry trades, whereby speculators take advantage of Japan’s rock-bottom interest rates to raise cheap funds to invest elsewhere.
   The dollar fell to 115.60
   yen in Tokyo afternoon trade from 116.79 in New York late Friday.
   At one point the greenback dropped to as low as 115.41, levels last seen on December 8.
   The euro slipped to 1.3160 dollars from 1.3191 and tumbled to 152.17 yen from 154.10.
   ‘Last week’s volatility is continuing into this week and, amid excess liquidity, traders have trimmed their yen carry-trade positions,’ said Saburo Matsumoto, chief forex strategist at Sumitomo Trust Bank.
   The Bank of Japan’s gradual move towards a more normal level of interest rates was also prompting speculators to reduce their sell positions on the Japanese currency, he added.
   Analysts say that no one really knows the true size of the yen carry trade, but world finance chiefs fear that if the credit bubble bursts it could spread havoc on global markets.
   The recent steep falls on world stock markets have prompted renewed jitters about the carry trade and a flurry of funds back to Japan.
   ‘The Japanese yen continues to benefit from pick-up in risk aversion following the losses in global equity markets,’ National Australia Bank strategist John Kyriakopoulos wrote in a morning note.

Profit
   Social Investment Bank
   As per audited accounts as on December 31, 2006, the Bank has reported net profit of Tk. 57.63 m with EPS of Tk. 98.52 as against Tk. 13.94 m and Tk. 23.82 respectively as on December 31, 2005.
   H.R.Textile
   As per audited accounts as on September 30, 2006, the company has reported net profit of Tk 16.30m with EPS of Tk 8.15 as against Tk 14.90m and Tk 7.45 respectively as on September 30, 2005.
   
   Dividend
   Lafarge Surma Cement Ltd.
   The board of directors did not recommend any dividend
   for the year 2006. Annual
   general meeting of the company will be held on June 28
   at the Bangladesh-China Friendship Conference Centre, Committee Room-1, Agargaon, Sher-E-Bangla Nagar, Dhaka. Record Date: May 30.
   
   Transaction
   NBL
   Tabith M Awal, one of the sponsors of the bank, has further reported that he has completed his sale of 6,000 shares of the bank at prevailing market price through stock exchange as announced earlier.
   Source: DSE, CSE

South Korea seeks to revise OECD report
South Korea said Monday it would call on the Organisation for Economic Cooperation and Development to revise a 2007 draft report which criticised aspects of its economic policy. The report misinterpreted government policy, especially its push to curb soaring home prices, the ministry of finance and economy said in a statement. It did not elaborate. Dong-A Ilbo newspaper said the OECD criticised the government for capping the sale price of private apartments as being against market principles.
— AFP

Porsche revises upwards first-half profits
Porsche, the German maker of luxury sports cars, revised upwards Monday its figures for earnings in the six-month period to January. Porsche, which runs its business year from August to July, said it had booked after-tax profit of 1.144 billion euros (1.5 billion dollars) in the six months to January, up from 169.8 million euros a year earlier. In preliminary figures published in January, the car maker had said that first-half net profit amounted to 1.05 billion euros. Pre-tax profit also increased nearly sixfold, rising to 1.59 billion euros from 277.8 million euros, Porsche said.
— AFP

Taiwan forex reserves rise to $267.99b
Taiwan’s foreign exchange reserves totaled 267.99 billion dollars at the end of February, up from the 265.97 billion dollars at the end of January, the central bank said Monday. The increase in foreign exchange reserves in February could first be attributed to returns from foreign reserves management, it said. The euro and other major currencies appreciated against the US dollar, and thus, foreign exchange reserves denominated in these currencies were small in terms of the base currency — the US dollar, the central bank added.
— AFP