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Private commercial banks, which will fail to raise their capital to Tk 400 crore in next three years, will have to look for merger with other banks or financial institutions, says the central bank.
   In a letter Thursday, Bangladesh Bank asked the private banks to achieve the threshold by August 11, 2011 in line with the government decision to double the capital requirement to Tk 400 crore.
   The requirement was doubled to Tk 200 crore only last year and many banks were still struggling to achieve that level.
   Out of 28 listed PCBs, only nine banks could have paid-up capital of over Tk 200, according to the latest monthly review of Dhaka Stock Exchange.
   ICB Islamic Bank [formerly Oriental Bank] has the highest paid-up capital of Tk 660 crore, while United Commercial Bank has the lowest Tk 29.9 crore, the review said.
   The increased paid-up capital requirement will help the bank become financially strong, said M Shahjahan Bhuiyan, managing director of United Commercial Bank.
   More shareholders mean more accountability and transparency of a bank, and a higher paid-up capital helps a bank keep its share price reasonable, he said.
   For supervision purpose, the central bank categorised the capital into two tiers — tier 1 or core capital which comprises of the highest quality capital elements and tier 2 or supplementary capital represents other elements which also contribute to the overall strength of a bank.
   The tier 1 components include paid-up capital, non-repayable share premium account, statutory reserve, general reserve, retained earnings, minority interest in subsidiaries, non-cumulative irredeemable preference shares and dividend equalisation account.
   General provision maintained against unclassified loans, assets revaluation reserves, all other preference shares, perpetual subordinated debt and exchange equalization A/C are categorised under tier 2.
   The banks can retain profit after tax, and if necessary, float repeat initial public offering or issue right share to increase the capital, the central bank’s latest letter said.
   If there is any deficit in capital, banks cannot declare any cash dividend, it added.
   Foreign banks will have to retain tax after profit or bring capital from abroad to meet capital deficit, if any, the central bank instructed.

The World Trade Organisation has reiterated the member states’ pledge to provide the least developed countries, such as Bangladesh, with duty-free, quota-free access of their products to the markets of developed countries.
   The trade negotiation committee on market access for non-farm products reaffirmed its determination to help the poorer economies to ‘secure beneficial and meaningful integration into the multilateral trading system’ in the light of the decision taken in the Hong Kong ministerial meeting of the WTO in 2005.
   During the mini-ministerial talks in Geneva in late July, Dhaka advocated ‘commercially meaningful’ market access to developed countries’ markets so that products originating in the LDCs such as Bangladesh would not face any barriers.
   In the report on the ‘July 2008 Package’ talks on Tuesday, the committee’s chairperson, Don Stephenson of Canada, recalled the Hong Kong Declaration endorsed by the developed and developing countries which are its members.
   It called for providing ‘duty-free and quota-free market access on a lasting basis for all products originating from all LDCs by 2008 or no later than the start of the implementation period in a manner that ensures stability, security and predictability’, according to a message received from Geneva.
   The report also mentioned that members facing difficulties at this time to provide market access shall provide duty-free and quota-free market access
   for at least 97 per cent of products originating from LDCs
   by 2008 or no later than the start of the implementation period.
   After the LDCs, especially Bangladesh, insisted on commercially meaningful market access, the negotiation committee included in the text a clause on ‘meaningfully enhanced market access for all LDCs’.
   However, all such pledges made in the Hong Kong ministerial meet need to be incorporated in agreements of binding obligations through conclusion of talks on the agenda adopted in the WTO’s Doha Development round of negotiations in 2001.
   Also, the WTO’s developed country members need to agree on the date of providing duty-free and quota-free market access of products from the LDCs prior to the Special Session of the Ministerial Conference to be held to take decisions on adoption and implementation of the results of the negotiations in all areas of the Doha Round Agenda.
   The recent mini-ministerial talks of the WTO in Geneva failed to make headway for holding the next round of ministerial talks, although a key negotiator from Indonesia hinted at the resumption of the talks later this year.
   The Bangladesh commerce adviser, Hossain Zillur Rahman, who joined the recent Geneva talks, expressed the hope that the Doha Development talks might be concluded in 2009 and transform the promises made to LDCs into reality.

Dhaka stocks gained on Thursday, the closing day of the week, due to institutional buying at the late trading, said market operators.
   Turnover at the Dhaka Stock Exchange, however, dropped to Tk 181.97 crore from the Wednesday’s Tk 233.40 crore.
   The DSE general index gained 13.81 points or 0.52 per cent to close at 2675.07, while its blue chips index, DSE20, advanced by 13.02 points or 0.53 per cent to finish at 2479.53.
   A DSE stock broker said the market finished up due to buying from institutional investors who bought shares to avail the lower price of securities after the previous day’s fall.
   The investors put their money on shares ahead of a three-day closure of the bourses, he said.
   The DSE and the Chittagong Stock Exchange remain closed on Friday and Saturday as weekly holidays and will remain closed on Sunday as public holiday on the occasion of Shab-e-Barat.
   Of the total 225 issues traded at the DSE on Thursday, 125 advanced, 85 declined and 15 remained unchanged.
   Titas Gas Transmission and Distribution Company topped the turnover leaders with a total transaction of Tk 25.32 crore.
   Beximco Pharmaceuticals, Beximco, ACI, Keya Cosmetics, BATBC, LankaBangla Finance, Islami Bank, Agni Systems and Pragati Life Insurance Company were among the top 10 turnover leaders.
   The CSE selective categories index gained 28.08 points or 0.52 per cent to close at 5380.16, while its blue chips index, CSE30, advanced by 14.16 points or 0.19 per cent to finish at 7541.06.
   Of the total 117 issues traded at the CSE, 52 posted gains, 59 dropped and six remained unchanged.
   Turnover at the CSE increased to Tk 29.01 crore from the Wednesday’s Tk 24.69 crore.

Rising prices stretched Americans’ wallets further in July, according to a government survey Thursday which showed that consumer price inflation surged by a more-than-expected 0.8 per cent.
   On an annual basis, the government’s Consumer Price Index — a key barometer of price pressures — leapt 5.6 per cent to July, marking the biggest annualized spike since January 1991.
   Core prices, which strip out volatile energy and food costs, rose 0.3 per cent in July from the prior month, the Labor Department said in a monthly survey.
   The 0.8 per cent jump in the CPI during July was double the expectation of most economists, while the rise in the core rate was a notch above most forecasts.
   And while consumer prices soared on an annual basis by the largest margin in 17 years, the core reading — which rose 2.5 per cent in the year to July — marked its most significant gain since February 2007.
   Inflation is troublesome for economic policymakers because price spikes can tighten consumers’ budgets forcing them to cut spending on non-essentials which can in turn dent wider economic growth.
   The Federal Reserve could in theory hike interest rates to cool inflationary pressures, but its hands have been tied by a lingering housing market slump and a widespread credit crunch gripping the banking industry.
   The report showed that inflationary pressures continue to squeeze the world’s largest economy, but Fed policymakers might be pleased to see a moderation in headline inflation.
   The monthly CPI rate, while higher-than-expected, cooled from a June reading of 1.1 per cent, and some economists believe inflation pressures could cool further in coming months.
   Although energy costs remain relatively high, oil prices have fallen dramatically in recent weeks with New York prices trading around 116 dollars a barrel Thursday, compared with record peaks over 147 dollars just last month.
   The central bank, which opted to keep its main interest rate unchanged at 2.0 per cent earlier this month, has said that it expects inflation to moderate later this year.
   Economists said that it does appear that energy-related price pressures are diminishing.
   ‘Despite the jump in inflation readings for July, we have rising conviction that inflation readings for August and now even September will be more favorable thanks to the sustained trend in retail petrol and natural gas prices,’ said Stephen Gallagher, an economist at Societe Generale.
   Energy costs contributed to the increase in inflation during July, rising 4.0 per cent compared with 6.6 per cent in June. The energy reading has risen sharply for three straight months as fuel costs continue to have a major impact on inflationary pressures.
   Petrol prices climbed 4.1 per cent while natural gas costs jumped 7.4 per cent, the report showed.
   Food prices, which increased 0.9 per cent, also stoked inflation, picking up momentum a notch compared with a 0.8 per cent gain in June as strong price gains were tracked on cereals and dairy products.
   Clothing, transport and housing costs all rose relatively strongly during the month as well, however.
   Clothing prices jumped 1.2 per cent during July, marking the largest such spike since August of 1998. Analysts said part of the rise was likely due to retailers trying to pass increased costs on to consumers.
   Some economists said that while oil prices have clearly weakened of late, price hikes in other sectors could continue driving inflation pressures.
   ‘The real eye opener was the jump in clothing prices,’ said Joel Naroff, chief economist at Naroff Economic Advisors.
   ‘One month is hardly a trend, but with import prices jumping, we may be now seeing apparel adding to inflation rather than restraining it. It is also a warning that we could be seeing price increases in other areas as the import cost rises spread through the economy,’ Naroff added.

A high-powered meeting of the government on Thursday expressed dissatisfaction over the performance of Sonali Bank Limited since its corporatisation.
   The meeting chaired by finance adviser Mirza Azizul Islam reviewed the performance indicators of the government-owned bank.
   Two other corporatised state lenders —Janata and Agrani banks will also come under the scrutiny, officials said.
   Additional incentives for employees would be suspended until they showed better performance, the meeting was told.
   A senior official, who attended the Thursday’s meeting, said that the bank and its employees had been asked to come out of the previous style of banking and be more enterprising to offer better services to the clients.
   Cabinet secretary Ali Imam Majumder, Bangladesh Bank governor Salehuddin Ahmed, and senior officials of the ministry, central bank and Sonali Bank were present at the meeting.
   ‘The performance did not deteriorate from the level the bank had at the time of corporatisation,’ the finance adviser told reporters after the meeting. ‘But there was scope for improvements,’ he said.
   Replying to a question, Aziz said the bank would have to improve its services and financial performance further.
   ‘Sonali Bank could fulfil some of the indicators set by the government for one year after corporatisation, while some others remained unmet,’ he added.
   The bank failed to improve the status of non-performing loans as state-owned enterprises failed to repay loans while court cases stalled recovery of huge default loans.
   ‘We are assessing how much could be recovered from the court cases,’ he further said.
   Meeting sources said the amount of Sonali Bank’s bad loans increased to Tk 8,547 crore in June 2008 from Tk 6,860 crore in December 2007.

Cambodia has become the sixth leading destination for South Korean overseas investment, English daily newspaper the Phnom Penh Post Thursday quoted South Korean ambassador Shin Hyun-suk as saying.
   The total amount of South Korean investment in Cambodia to March 2008 stood at 1.46 billion US dollars, followed by China, the US, Hong Kong of China, Vietnam and Malaysia, he said.
   The number of South Korean investors in Cambodia was above 500 and they used to focus on the garment sector, but in recent years became diversified to banking, agriculture, food processing, tourism, manufacturing, construction and IT, he said.

The Grameenphone Ltd and Titas Gas Transmission and Distribution Company Limited have jointly launched the BillPay service for collection of Titas Gas bills.
   Under the service, persons who have Titas Gas connection will be able to pay their bills either from their Grameenphone mobile or at any GP-authorised BillPay centre, said a press release.
   BillPay is a reliable, quick and convenient bill payment service that ensures full end-to-end transparency and the ultimate convenience for utility consumers.
   Titas Gas consumers in all its operational areas and PDB electricity consumers in Chittagong and Cox’s Bazaar will be able to pay their Bills from their GP connections and at over 1500 authorised BillPay centres.
   Ander Jensen, chief executive officer of the Grameenphone, and Md Abdullah, managing director of Titas Gas, spoke at the BillPay launching programme in the Dhaka city recently.

The People’s Bank of China, or the central bank, will blacklist foreign bankcards found involved in fraud cases, as one of the country’s efforts to curb bankcard crimes and create an Olympics-friendly payment environment.
   The list would help the card issuer banks, merchants and other agencies to stop service for suspects, Ouyang Weimin, director general of the Payment and Settlement Department of the People’s Bank of China, told a press conference on Wednesday.
   But he did not say whether any cards have been listed so far.
   ‘According to the experience of previous Olympic hosts, there were high incidences of bankcard-related crimes during the Games,’ he said. ‘China has adopted several measures to curb them.’
   A joint action between the central bank and police started in April. The authorities have registered 1,600 cases and arrested 342 suspects, implicating more than 40 million yuan.
   Contingency plans were made to cope with possible hacker attacks on banking system.
   ‘We also adopted precautious policies. For instance, foreign cardholders are asked to show their IDs if spending more than 10,000 yuan ($1,449) once in China,’ Ouyang said.
   Non-cash payment has been popular across China in the past seven years as the nation worked hard to provide quality financial service for the Games.
   China has shifted to a ‘non-cash payment nation’, despite a stereotype that Chinese prefer using cash, Ouyang said.
   About 240 trillion yuan ($34.78t) were transferred through banknotes last year, compared with 18 trillion in 2001, and 116 trillion through bankcards, over 8 trillion seven years ago, he said.
   In addition, 800 trillion yuan were transferred between bank accounts.
   The country has issued 1.6 billion bankcards, each Chinese having one on average. The figure was 380 million in 2001.

Country’s largest lender State Bank of India on Thursday said the Finance Ministry had approved the merger of State Bank of Saurashtra with itself.
   ‘The ministry of finance has passed an order for acquiring of State Bank of Saurashtra by State Bank of India,’ SBI said in a filing to the Bombay Stock Exchange.
   The merger would be effective from the ‘date as may be notified by the government of India in the official Gazette’, the filing added.
   Earlier this month, the Union Cabinet had approved the merger of SBS with SBI. The boards of both the banks had given their approval for the merger in August last year. SBS is a wholly-owned subsidiary of the State Bank of India.
   After getting Cabinet approval, the Finance Ministry has finished the groundwork for repealing the State Bank of Saurashtra Act-1950 and amending the SBI Subsidiary Act-1959 to affect the merger.
   Government would have to present a new bill called the SBI Subsidiary Bank Amendment Bill-2008, in parliament during the monsoon session for final approval on the merger. All the references to the SBS Act would be deleted from the SBI Subsidiary Act-1959, through the proposed Bill.
   The merger would pave way for the amalgamation of other six associate banks of SBI with itself and help the country’s largest lender take on the competition, particularly from private and foreign lenders, in a better manner.
   The merger would also enable State Bank to scale up its business in terms of footprint, manpower and resources.
   Shares of SBI were trading at Rs 1,495.90, down 3.82 per cent in the morning trade on the BSE.

The eurozone economy contracted for the first time ever, with output falling 0.2 per cent in the second quarter increasing the threat of recession driven by a sharp global downturn.
   The initial official figures come amid rising concern that recession, two consecutive quarters of contraction, is now stalking the 15-nation eurozone, a prospect now pushing down the euro.
   ‘Today’s releases suggest that this probability has risen, probably to over 50 per cent now,’ said Sunil Kapadia, european economist for UBS Investment Research.
   Recent data from Britain and Japan also suggest leading economies are flirting with recession; and the International Energy Agency says energy and other data signal the US economy is most probably heading towards recession.
   A European Commission spokeswoman shied away from using the ‘R’ word, while acknowledging the eurozone figures looked bad, especially with eurozone inflation running at a record four per cent.
   ‘I think it’s a bit exaggerated to use that word,’ she told reporters in Brussels, stressing that the preliminary figures could be revised later.
   But she also said: ‘The signs are not really very good for the future’.
   Marc Touati at Global Equities in Paris was pulling no punches. ‘The recession has started,’ he said.
   As the subprime crisis overtook the US economy, some commentators had suggested that Europe might escape the worst effects, but economist Nicolas Bouzou at consultants Asteres said: ‘The situation in Europe, overall, is serious.’
   The eurozone economy had grown by 0.7 per cent in the first three months of 2008, held up by a 1.3-per cent rise in Germany, where an unusually clement winter boosted the construction industry.
   That buoyancy slipped away in the second quarter with the German economy, the biggest in the eurozone, contracting for the first time for nearly four years, shrinking 0.5 per cent.
   Meanwhile the French economy contracted by 0.3 per cent over the quarter, as did Italy’s while Spanish gross domestic product was up by 0.1 per cent.
   The worst previous performance of the eurozone economy was in the second quarter of 2003 when growth was measured at zero, skirting the contraction seen now.
   The figures for the EU as a whole were scarcely better, with gross domestic product figures dipping by 0.1 per cent in the second quarter.
   The overall EU figures were helped by the British economy going some way to bucking the trend with expansion for the second quarter recorded at 0.2 per cent.
   However the Bank of England forecast on Wednesday that Britain too faced increased risk of recession with economic growth set to slow further and inflation expected to spike.
   All commentators stress that this is not just a European problem, with high oil and food prices hitting purchasing power everywhere.
   The global nature of Europe’s economic woes were demonstrated on Wednesday when Japan said its own economy had contracted in the second quarter as falling exports and weak consumer spending sent Asia’s largest economy hurtling toward its first recession in six years.
   At the same time US retail sales fell 0.1 per cent in July in the face of slumping car and truck sales as Americans cut back on large purchases.
   That report bolsters the outlook of some economists who say the world’s largest economy is slowing and will post lackluster growth in future months, especially as retail sales represent a key economic driver.
   Eurostat also announced on Wednesday that 12-month inflation remained at its record high 4.0 per cent in the eurozone in July.
   It is the fire of high inflation and the ice of low growth which gives the European Central Bank headaches in setting interest rates while also racing the unwelcome spectre of ‘stagflation’.
   Last week ECB president Jean-Claude Trichet stressed that fighting inflation was the ‘primary objective’ of the eurozone central bank despite the evidence of slowing growth.
   Trichet spoke after the bank left its benchmark interest rates unchanged at 4.25 per cent.
   Jennifer McKeown, european economist at London-based Capital Economics, said the European economic figures, though ‘better than we had expected’ provided ‘scant consolation given that July’s business surveys so far point to a second consecutive fall in the third quarter,’ throwing the eurozone into the dreaded recession.

China’s industrial output growth slowed to a 17-month low in July as weakening exports hit factory production across the nation, official figures showed Thursday.
   The slowdown might also reflect the government’s decision to reduce industrial activity in and around Beijing to try and cut air pollution for the Summer Olympics during August, according to economists.
   Industrial production expanded by 14.7 per cent in July from the same month a year ago, down from 16.0 per cent in June and 18.0 per cent in July last year, the National Bureau of Statistics said.
   ‘The deceleration in export growth was the main reason for the slowdown in industrial output,’ the bureau said, adding export growth in July was 26.9 per cent, compared with a more robust 34.2 per cent in July 2007.
   Lower demand due to the global economic slowdown, and the strengthening of the Chinese yuan, were among key factors in causing export growth to weaken, it said.
   Investment bank Goldman Sachs said in a research note that factory closures for the Olympics could be a factor too, along with the government’s moves in recent months to slow the flow of credit.
   ‘The deceleration in industrial production growth could be the result of Olympic-related production suspensions and restrictions amid the on-going credit tightening since last October,’ Goldman Sachs said in a research note.
   ‘We expect industrial production growth to be under continued pressures from these impacts, especially in the next two months.’
   The output growth figure was last at such levels in February 2007 when it hit 12.6 per cent, distorted mainly by seasonal factors due to the Lunar New Year, the biggest holiday of the year in China.
   Industrial output expanded 16.1 per cent in the first seven months of the year from the same period in 2007, according to the figures.
   Economists said power bottlenecks probably hit plants and sweatshops in July.
   ‘Fairly widespread power shortages likely restricted industrial production, as evidenced by the fall in electricity production growth,’ said Sun Mingchun, an economist with Lehman Brothers.
   Power output was up just 8.1 per cent July from a year earlier, the lowest level since February 2007, he said.
   The statistics bureau said costs were rising for local companies due to the impact of elevated commodity prices, such as for crude oil and iron ore. Inflation in China is at around 12-year highs.

US retail sales declined a negative 0.1 per cent in July in the face of slumping car and truck sales as Americans cut back on large purchases, a government report showed Wednesday.
   The Commerce Department’s monthly snapshot showed that American consumers are continuing to feel the pinch from a lengthy housing slump, a widespread credit crunch and high oil prices.
   The decline in sales was the first since February, although most economists had predicted a drop.
   ‘The July retail sales report was much as expected. Plunging vehicle sales dragged down the headline figure, and the rise in ex-autos spending will have been eaten up by higher food and gasoline prices,’ said Nigel Gault, chief US economist at Global Insight.
   Excluding car and truck purchases, retail sales rose 0.4 per cent in July from the prior month.
   The report will likely bolster the outlook of some economists who say the world’s largest economy is slowing and will post lackluster growth in future months, especially as retail sales represent a key economic driver.
   Sales contracted last month despite the Bush administration injecting a giant 168 billion dollars stimulus into the economy this summer which was stuffed with one-off tax rebates aimed at firing up consumer spending.
   Some analysts said that the ill economic winds have likely made consumers more wary about spending.
   ‘Cautious and uncertain consumers are watching their wallets and with the back-to-school shopping season underway, that does not bode well for retailers,’ said Joel Naroff, chief economist at Naroff Economic Advisors.
   The report was released as Macy’s, the large retailer, revealed a 2.1 per cent decline in same-store sales during the second quarter.
   The fall in July sales came as the Federal Reserve opted to keep its key interest rate on hold at 2.0 per cent earlier this month and economists said the central bank is likely to keep the rate suppressed as long as retail activity remains sluggish.
   The decline in sales was largely due to falling car and truck sales which have been hit by high fuel prices this year, although oil prices have cooled notably in recent weeks.
   Sales of motor vehicles and parts fell a negative 2.4 per cent, after posting a contraction of 2.1 per cent in June, marking the sharpest dip since April.

Scandinavian airline SAS said on Thursday it had flown into loss during the second quarter owing to the economic slowdown and high fuel prices, and would slash another 500 jobs and seven planes from its fleet.
   The company recorded a net loss of 411 million kronor ($65.4m) in the April-June period, down sharply from a 607 million kronor profit 12 months earlier, it said in a statement.
   It also posted a pre-tax loss of 106 million kronor, compared to a profit of 762 million a year ago, and an operating loss of 51 million kronor against a profit of 892 million.
   Sales rose 8.7 per cent, however, to 17.7 billion kronor.
   The earnings report was a bit better than analysts’ expectations of a net loss of 538 million and sales of 17.13 billion kronor, according to a consensus compiled by Dow Jones Newswires.
   ‘As expected, the SAS Group’s earnings for the second quarter were weak ... which is a clear decline compared with the year-earlier period,’ chief executive Mats Jansson said in a statement.
   ‘The reasons for the decrease in earnings are well-known: rapidly rising jet-fuel prices to record-high levels combined with weaker economic trends and overcapacity in the market,’ he said.
   He said the group was therefore strengthening its action plan announced in April after reporting a first quarter loss. For the first half, the net loss amounted to 1.54 billion kronor, against a pofit of 560 million a year ago.
   SAS said it had decided ‘to reduce capacity by an additional seven aircraft, entailing a total reduction of 18 aircraft’ or 10 per cent of its fleet, while for the entire group, including Spanish subsidiary Spanair, the total reduction corresponded to 33 aircraft.
   SAS in July unveiled a restructuring programme for Spanair, cutting 15 planes from its fleet and 1,000 jobs.
   The 500 job cuts meanwhile brought the number of overall reductions to approximately 2,500. At the end of 2007, the group had 25,000 employees.
   ‘These measures should be seen in the light of an expected further slowdown in the economy in 2008 and 2009,’ Jansson said.
   He noted the airline industry was experiencing difficult conditions, ‘probably the most difficult it has ever been.’
   The price of SAS’ share rose on the Stockholm stock exchange on the news, climbing 3.70 per cent to 47.70 kronor in an overall market up by 0.92 per cent.

The value of the South Korean government’s shares in financial institutions and private companies has dropped by 4.5 trillion won ($4.4b) since the end of last year, the Korea Herald reported on Thursday.
   The value of shares that the government holds in eight private firms and financial institutions through the Korea Deposit Insurance Corp, Korea Development Bank and Korea Asset Management Corp fell from 23.05 trillion won ($22.5b) recorded at the end of last year to 18.55 trillion won ($18.1b) on Tuesday, the daily newspaper said.
   The loss was blamed on the value of government-held stocks dropping by as much as 41.1 per cent, as the local composite stock price index fell 20.3 per cent so far this year, it said.
   Of the 4.5 trillion won loss, more than 64 per cent was accounted for by the fall in the value of Woori Financial Holdings Co and Daewoo Shipbuilding and Marine Engineering’s shares, it said.
   Between the end of last year and Tuesday, Woori Financial Holdings Co’s shares fell 15.1 per cent, causing the value of the government’s 73 per cent stakes in the company to decrease by more than 1.6 trillion won ($1.56b) from 11.87 trillion won ($1.83b) to 9.41 trillion won ($9.2b).
   Over the same period, Daewoo Shipbuilding and Marine Engineering’s shares, held by the Korea Development Bank, fell 25.1 per cent, cutting the value of the government’s shares by more than 1.2 trillion won ($1.17b).
   The Korea Development Bank subsidiary Daewoo Securities Co was the company that incurred the third largest loss for the government followed by Hyundai Engineering and Construction Co Daewoo Securities Co’s shares have fallen 39.2 per cent while that of Hyundai Engineering and Construction Co has fallen 24.6 per cent, bringing the government losses of 892 billion won ($872.8m) and 354 billion won ($346.3m), respectively.
   The remaining 330 billion won ($323.5m) loss was accounted for by Hynix Semiconductor Inc, Ssangyong Cement Industrial Co and Daewoo International whose shares have fallen by between 5.6 per cent and 41.1 per cent over the period.

The Grameenphone Ltd recently signed an agreement with the Dutch-Bangla Bank Ltd for collection of the distributor payments through DBBL online branches all over Bangladesh.
   Md Arif Al Islam, chief financial officer of Grameenphone, and Moyen Uddin Ahmed, executive vice-president and head of card division of DBBL, signed the agreement through a ceremony held in the Dhaka city, said a press release.
   Senior officials of the Grameenphone and the DBBL were also present on the occasion.

AKTEL, a telecom operator, recently has launched its latest service ‘AKTEL Tele Health Services’ in association with Japan Bangladesh Friendship Medical Services Limited for its customers.
   An agreement was signed between AKTEL and JBFMS to this effect at a ceremony held at the AKTEL’s corporate office in the Dhaka city on Wednesday, said a press release.
   AKTEL chief executive officer and managing director Jefri Ahmad Tambi and chief financial officer Nora Junita, and JBFMS chairman Jonaid Shafiq and managing director Sarder A Nayeem, among others, were present in the agreement signing ceremony.
   Under the service, AKTEL customers will be able to get on-call health related service, medical advice and consultancies by registered physicians over mobile phone by dialing 10600 - 24 hours a day.

The Berger Paints (BD) Ltd inaugurated three more outlets Berger ColorBank in the Dhaka city.
   Rupali Chowdhury, managing director of the Berger Paints (BD) Ltd, inaugurated the outlets Sajjad Paints and Moonmoon Paints at Nawabpur Road and Al-Amin Hardware at North South Road, said a press release.
   The company’s general manager Mohsin Habib Chowdhury and general sales manager and regional sales manager of Dhaka Syed Abu Abed Saher, among others, were present in the inauguration ceremony.

The euro dipped against the dollar on Thursday as official data revealed that the eurozone economy has contracted for the first time since its creation in 1999.
   In morning trading, the European single currency fell to 1.4905 dollars from 1.4909 late in New York on Wednesday.
   Against the Japanese currency, the dollar rose to 109.60 yen from 109.57. The eurozone economy suffered negative growth, or contraction, in the second quarter, official data showed on Thursday.
   Output fell by 0.2 per cent in the April-June period as German growth succumbed to global strains.
   The results, released by the EU’s Eurostat data agency, come in a context of rising concern that recession, two quarters in a row of negative growth, is now stalking the 15-nation eurozone.
   Eurozone gross domestic product had grown by 0.7 per cent in the first three months of 2008.
   ‘If euro area GDP growth in the third quarter does show some positive growth, then in our view the ECB is unlikely to yield to pressure for lower rates at least during this year,’ said Barclays Capital analyst Julian Callow.
   The economic climate in the eurozone is at the lowest level in 15 years, the latest Ifo World Economic Survey meanwhile showed on Thursday.
   Analysts expect economic activity to worsen further over the next six months, according to the report.
   ‘Many players are keen to sell the euro and the pound as the outlook for the economy and monetary policy in Europe is very uncertain,’ Akio Shimizu, foreign exchange chief at Mitsubishi UFJ Trust and Banking, told Dow Jones Newswires.
   ‘It’s very difficult now to find positive factors to help these currencies to bounce back,’ he added.
   The British pound languished near the lowest level for almost two years against the greenback, falling to 1.8678 dollars in Asian trade, after the Bank of England issued a gloomy economic outlook.
   The central bank had Wednesday said that British inflation could fall sharply toward the government’s target of 2.0 per cent from early 2009, which prompted traders to bet on interest rate cuts sooner than previously expected.
   Barclays Capital analysts said they now expect quarter-point rate cuts in Britain in November, February, April, and May.
   The dollar was generally firm against other major currencies despite an overnight slump on Wall Street blamed on rebounding oil prices and renewed worries over the health of the financial sector, dealers said.
   In London trading on Thursday, the euro changed hands at 1.4905 dollars against 1.4909 late on Wednesday, at 163.35 yen, 0.7966 pounds and 1.6196 Swiss francs.
   The dollar stood at 109.60 yen and 1.0868 Swiss francs.
   The pound was at 1.8719 dollars. On the London Bullion Market, the price of gold increased to 836.25 dollars per ounce from 818.50 dollars late on Wednesday.

World oil prices extended their rebound in Asian trade Thursday on data showing a bigger-than-expected decline in US petrol stockpiles during the peak demand season, analysts said.
   New York’s main oil futures contract, light sweet crude for September delivery, advanced 53 cents to 116.53 dollars a barrel. It had rallied 2.99 dollars at the close of New York floor trading Wednesday.
   Brent North Sea crude for September was up 73 cents at 114.20, after gaining 2.32 dollars in London trade the previous day.
   ‘Crude has regained some of its losses over the past few trading sessions reacting to the inventory report which showed very substantial stock draws in gasoline,’ said energy analyst Victor Shum at Purvin and Gertz in Singapore.
   The US Department of Energy reported Wednesday that US reserves of petrol had fallen by 6.4 million barrels in the week ended August 8. That was worse than analysts’ predictions for a drop of just 2.0 million barrels.
   Petrol inventories are closely watched at this time of year as American motorists hit the highways for their summer vacations, typically pushing up demand for the refined fuel.
   Despite the rally, Shum said that slowing global energy demand resulting from the weakening economies of the United States, Europe and Asia was likely to weigh down on oil prices.
   The market at the moment appeared to be ignoring supply-side issues that could arise from
   geopolitical risks, he said.
   ‘Concerns about the US economy and now the spread of the economic slowdown to Europe and Asia could push crude oil pricing to test lower lows because some of the supply issues have been discounted by the market,’ Shum said.
   Dealers have said that fears of supply disruption had receded after Russia and Georgia agreed to a French-brokered peace plan following several days of hostilities.
   Georgian forces were retaking control of the Georgian city of Gori as the Russian military withdrew, Interior Ministry Spokesman Shota Utiashvili told AFP Thursday.
   British energy giant BP said on Tuesday that it had closed a regional oil pipeline because of the fighting, but that supplies were flowing from the Caspian Sea to the West by other routes.
   Energy expert Shum said threats of future supply disruption were limiting the oil price decline.
   ‘The supply issues should really become relevant again at some point and this is likely to backstop the drop in oil pricing,’ he said. ‘These issues have not disappeared, they have simply been discounted.’
   Oil prices have tumbled dramatically since hitting record highs above 147 dollars one month ago.

Pesticide use up to 145pc in last seven years
The use of pesticides at the agriculture fields over the last seven years rose to an alarming level, causing serious environmental and health hazards in the country. Executive chairman of Bangladesh Agriculture Research Council and director general of Bangladesh Agriculture Research Institute M Harun-ur-Rashid said the use of pesticides in the croplands increased to 145 per cent during the period. ‘The total import of pesticides in the country in 2001 was 15,376 tonnes, which increased to 37,712 tonnes in 2007,’ he informed on Thursday. The BARC executive chairman said that use of pesticides stared in 1955-56 with imports of three categories. ‘Eighty per cent of imported pesticides were used at paddy fields. Now six to seven times more pesticides are being used for vegetables production than paddy,’ he added. Stressing the need for awareness among the farmers about the proper use of pesticides, Rashid said excess use of pesticides not only causes environmental and health problems, but also reduces their effectiveness. He said the farmers are now using pesticides on large scale to produce brinjal, bean, cow pea, cabbage and cauliflower. They are marketing the vegetables within five to six hours of using pesticides, but that should be done at least after seven to 10 days, he said. To reduce the use of pesticides, Rashid laid emphasis on providing training to agriculture extension officials on the Integrated Pest Management system.
— BSS

Warid signs deal with Grameen CyberNet
Warid Telecom Wednesday signed an agreement with internet service provider Grameen CyberNet Limited to provide complete telecommunication services under its corporate package. Under the agreement, Grameen CyberNet will enjoy customised call tariff and value added services of the Warid Telecom. Managing director of Grameen CyberNet Ghulam Mohiuddin and general manager, Sales, of Warid Telecom Mahboob Hossain signed the deal on behalf of their respective organisations at the Corporate Head Office of Warid Telecom in the Dhaka city. Since its commercial operation in Bangladesh on May 10, 2007, Warid invested $500 million to establish the state-of-art Next Generation Network. GCL, one of the pioneers and innovative information and communications technology companies in Bangladesh, offers communications solutions and internet service via different media since its commenced operation in 1996.
— UNB

Hong Kong gold closes higher
Hong Kong gold prices closed higher on Thursday at 835.00-836.00 US dollars an ounce, up from Wednesday’s close of 820.00-821.00 dollars. Gold opened at 829.50-830.00 dollars.
— AFP