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The interim government has approved the second version of the lenders-driven poverty reduction strategy paper for the next three fiscal years, forecasting 7.2 per cent economic growth in the terminal year and giving top priority to agriculture.
   Often claimed to be a home-grown development handbook, the strategy paper this time was finalised without any consultation with political parties though the onus of implementing it will fall on the next elected political government.
   The document, fashionably named ‘Moving Ahead: National Strategy for Accelerated Poverty Reduction II,’ will cover three fiscal years (2009-2011).
   It got the National Economic Council’s nod at a meeting on Thursday chaired by chief adviser Fakhruddin Ahmed.
   The first PRSP, which expired in June, was adopted on July 25, 2005, by the BNP–led four-party alliance government. Its preparation followed an I-PRSP exercise for years and series of discussions with stakeholders and grassroots people, though most of the targets remained far away from achievements.
    After the NEC meeting Thursday, finance adviser Mirza Azizul Islam said the PRSP-II was a blueprint for further development and was open to any suggestion for improvement.
   The main difference between the two versions of PRSP is that the second one assesses the development expenditures and identifies possible sources of fund, he said.
   ‘It remains up to the next elected government whether it will implement the PRSP-II or scrap it,’ he said to a questioner.
   The new PRSP has projected that GDP growth for the 2008-09, 2009-2010 and 2010-2011 fiscal years would be 6.5, 7 and 7.2 per cent, while inflation would be 9, 7.5 and 7 per cent respectively. The total resource gap for implementing the PRSP-II has been estimated at Tk 630 billion.
   Total amount needed to implement the PRSP stands at Tk 2,567.99 billion in constant price of fiscal year 2007-08.
   Non-discretionary expenditures like debt servicing and defence spending have been estimated at Tk 622.45 billion.
   Total public expenditure in the new PRSP period thus comes to Tk 3,190.44 billion, while total domestic resources have been expected at Tk 2559.50 billion.
   Economist Professor Abu Ahmed told New Age that he believed that the new political government after the December elections would need to bring some changes to the second PRSP.
    ‘Since the present government has approved the second donor’s–driven PRSP without consultation with political parties, it is very likely to have little focus on poverty reduction,’ he said, adding that the political parties are believed to have much better idea about and much more commitment to the country’s poor — the key electorate — than the people in the interim government.

The Securities and Exchange Commission on Thursday cancelled merchant banking licences of the First Securities Services Ltd and the Raspit Securities and Management Limited with immediate effect.
   ‘We have cancelled the licences of the two merchant banks as they remained inactive for years together,’ SEC executive director Farhad Ahmed told reporters.
   The First Securities Services was given licence to act as issue manager while the Raspit Securities and Management as full-fledged merchant bank, which was allowed to perform as issue and portfolio manager as well as underwriter for clients.
   He said the commission also gave December 31 deadline to the Pangaea Partners (BD) Ltd, the Prime Securities and Financial Services Ltd, and the Mercantile Securities Ltd, three merchant banks, to be operational in accordance with the Article-11 of merchant banker licensing rules, which was modified last year to drag merchant banks into action to propel the growth of country’s capital market.
   Of the three, the Pangaea Partners (BD) and the Prime Securities and Financial Services are issue managers, while the Mercantile Securities is a full-fledged merchant bank.
   Under the SEC merchant banker licensing rules, a merchant bank working only as issue manager has to submit at least a documented proposal for an initial public offer of a company, while a merchant bank licensed to act only as portfolio manager has to form at least five new portfolios of its clients besides its own, and a merchant bank working as a full-fledged merchant bank has to manage one IPO, to be underwriter of two issues and form five new portfolios of its clients besides its own in a calendar year.
   Provided that a full-fledged merchant bank has to perform at least two operations among the three including managing portfolio in a calendar year, the rules, however, say.
   Farhad said the First Securities Services and the Raspit Securities and Management did not perform in the last three years as per the rules.
   ‘On June 17 this year, the SEC sent hearing notices to the companies in this connection, but those were returned to the commission undelivered,’ he said.
   He said that the Pangaea Partners (BD), the Prime Securities and Financial Services, and the Mercantile Securities were given deadline as the merchant banks sought some time from the commission to be operational.
   ‘The licences of the three merchant banks will be annulled from January 1 next year if they fail to be operational in the given period of time,’ said the SEC official.
   So far, a total of 31 companies received merchant banking licences from the commission.
   Only a few of them are now active. Most of them have shown unsatisfactory performance in the capital market, with a number of them even appeared reluctant to start operations, SEC sources said.
   Of them, a total of 29 companies received merchant banking licences from the commission between January 1998 and April 2002. The Citigroup Global Markets Bangladesh Private obtained the licence last year and the Trust Bank this year.
   The SEC on September 7 last, cancelled the merchant banking licence of the Equity Valuation Research and Distribution Ltd.

The shipping licence hastily issued to a French company by the Chittagong Custom House has at last been scrapped in the face of protests by local businesses, custom sources said.
   A shipping licence was issued to the French shipping company CMA–CGM Bangladesh Shipping Ltd by the CCH recently, breaking the rules that ignited strong resentment among the local shipping companies and agents, shipping sources said.
   A senior official of CCH on Thursday said, ‘The licence issued to the French company was suspended following an order of National Board of Revenue. We received the order on October 20 and took step towards suspending the licence.
   Meanwhile, issuance of the licence spurred anger among the local shipping companies and agents who demanded immediate scrapping of the licence of French shipping company CMA-CGM Bangladesh Shipping Ltd.
   A week before the Eid-ul-Fitr festival, the CCH issued the shipping licence to the fully foreign company despite opposition from the Bangladesh Shipping Agents Association.
   The country’s shipping trade will be seriously affected if foreign companies are allowed to do business without following the rules of having 51 per cent share by a local company and 49 per cent by an overseas firm, people in shipping businesses observed.
   The government must protect the interests of the local businesses, they said.
   The foreign shipping company will take away the money from country, most likely fuelling the practice of capital flight, they added.
   Official sources informed that the France ambassador to Bangladesh and European Union representative in Dhaka strongly recommended the French shipping company for gaining the licence without following the country’s rules.

A top investment and industrial group of United Arab Emirates is interested in developing and operating a modern deep-sea port in Bangladesh.
   The UAE group will prefer invitation from Bangladesh government for developing the sea-port, CEO of the group said.
   The chief executive officer of Ras Al Khaimah Investment Authority, Khater Massaad, said they were operating two ports in the UAE, one in Georgia and developing one in Andrapradesh of India.
   ‘We are very much interested to develop and operate a modern deep-sea port in Bangladesh,’ said Massaad while talking to New Age correspondent at his office in UAE.
   He told New Age that their company could put $2-3 billion on developing a deep-sea port in Bangladesh.
   Massaad claimed that RAKIA was the largest investor from the Middle East in Bangladesh, owning a ceramic tiles and sanitary ware manufacturing plants, and a pharmaceutical factory, which would be opened next month.
   The company, few months back, also proposed to invest over $1 billion in hotel, tourism and real-estate sectors in Dhaka and Cox’s Bazar.
   ‘We will complete within two months feasibility studies on our earlier proposals, which include two 5-star hotels – one in Dhaka and one in Cox’s Bazar,’ said Massaad.
   Constituted in 2005, RAKIA is headed by crown prince Sheikh Saqr Bin Mohammed Al Qassimi, supreme council member and ruler of the Ras Al Khaimah.
   RAKIA manages diversified business ventures including, ceramics, cement, steel, real-estates and tourism, airlines, and financial institutions.
   It started operation in Bangladesh 13 years back with RAK Ceramics, a big tiles and sanitary ware manufacturer in Bangladesh.
   Massaad said the existing investment climate in Bangladesh was good and the incentives for foreign investors were also encouraging.

World stock markets took another heavy hit Thursday as investors were unable to overcome fears of a global recession and fretted over downbeat corporate projections.
   Share prices tumbled in Asia, Europe and in early deals on Wall Street in the wake of heavy losses on Wednesday, which came despite fresh government measures to snuff out a financial crisis threatening the critical flow of credit to businesses.
   On Thursday some of the world’s biggest companies gave voice to deep pessimism regarding their prospects in the months ahead.
   Investors appeared to ignore the crucial interbank market, where interest rates continued to weaken, indicating that banks — bolstered by government support moves — were at last starting to lend money to one another.
   Wall Street shares fell in volatile morning trade, giving back opening gains after a huge selloff a day earlier on recession fears.
   The Dow Jones Industrial Average reversed course and fell 0.77 per cent to 8,453.66 at 1353 GMT after a tumble of more than 500 points on Wednesday.
   The tech-heavy Nasdaq lost 1.10 per cent to reach 1,597.98.
   After heavy declines in Asia, European exchanges were deep into negative territory in late trade. The London FTSE 100 index was down 0.98 per cent, Paris 1.86 per cent and Frankfurt 2.63 per cent.
   ‘So long as there’s this rather blunt — and perhaps rather realistic — fear of a global recession looming, then there’s certainly scope that stocks will continue to struggle,’ said CMC Markets dealer Matt Buckland in London.
   Sentiment suffered from disappointing corporate news.
   ArcelorMittal, the world’s biggest steel producer, said the financial crisis has forced it to review its global growth projects while German automaker Daimler warned of weaker 2008 profits for a second time amid ‘a high degree of uncertainty’ over the outlook.
   Fiat of Italy, another big auto group, said its 2008 financial results would be at the lower end of its projection range and warned that tough market conditions next year could cut into profits.
   In Paris shares in Franco-Dutch airline Air France-KLM plunged more than 10 per cent after its chairman foresaw three years of zero growth.
   And in Tokyo Sony Corporation warned that the global economic slowdown, a stronger yen and fierce price competition would slash its profits by more than half in the current financial year.
   All Asian markets suffered dizzying losses on Thursday. Tokyo’s Nikkei index fell 2.46 per cent, after plunging by more than seven per cent at one stage to hit levels last seen in May 2003. Australia closed down 4.4 per cent and Hong Kong 3.6 per cent.
   Worst hit in Asia was Seoul, which ended down 7.4 per cent, while Shanghai declined by 1.07 per cent and Mumbai dipped 3.92 per cent.
   ‘Escalating concern about a global recession has prompted investors to bail out of growth-sensitive assets,’ said NAB Capital analyst Robert Henderson.
   While the outlook for the major economies is hardly rosy, ‘the picture is even uglier for emerging economies,’ he warned.
   Thursday’s stock market falls came despite an announcement of further measures designed to restore confidence in the finance sector and among consumers.
   Japan’s central bank said it had injected 600 billion yen ($6.2b) into the short-term money market while the International Monetary Fund moved to bail out Pakistan, which could need as much as 15 billion dollars to help pay mounting foreign debt.
   Governments around the world have unveiled packages over the last month totalling more than three trillion dollars, including loan guarantees and cash injections, to restore confidence to the financial system and reverse a sharp slowdown in lending.
   Meanwhile in Stockholm on Thursday, the Swedish central bank slashed its key interest rate by half a percentage point to 3.75 per cent and said it planned to make further cuts within six months.
   Noting that the global financial crisis had worsened since mid-September, the bank said the turmoil was ‘now clearly affecting developments in Sweden.’

Dhaka stocks gained on Thursday for the second straight day due to buying spree from investors after a five-day bear run, said market operators.
   The general index of Dhaka Stock Exchange gained 40.29 points, or 1.42 per cent, to close at 2868.11, while its blue chips index, DSE20, advanced by 53.01 points, or 2.24 per cent, to finish at 2415.92.
   A DSE stock broker said the market returned to upbeat trend from Wednesday as investors started buying shares after the five-day fall.
   Of the total 239 issues traded at the DSE, 164 advanced, 67 declined and eight remained unchanged.
   Turnover at the DSE increased to Tk 380.35 crore from the Wednesday’s Tk 322.80 crore.
   Beximco Pharmaceuticals topped the turnover leaders with a total transaction of Tk 29.31 crore.
   Titas Gas Transmission and Distribution Company, DESCO, Beximco, Summit Alliance Port, Aims 1st Mutual Fund, Square Pharmaceuticals, Golden Son, ACI and Quasem Drycells were the rest of the top 10 turnover leaders.
   Chittagong stocks also gained on Thursday for the second day after a five-day bear run.
   CSE selective categories index gained 89.68points, or 1.59 per cent, to close at 5739.36, while its blue chips index, CSE30, advanced by 166.81 points, or 2.21 per cent, to finish at 7699.45.
   Of the total 149 issues traded on the CSE floor, 97 posted gain, 49 dropped and three remained unchanged.
   Turnover at the CSE went up to Tk 57.07 crore from the Wednesday’s Tk 53.41 crore.

British Airways on Thursday celebrated its inaugural flight between Dhaka and Terminal 5 of London Heathrow Airport.
   Customers on the inaugural flight were offered commemorative gifts to mark the occasion, said a press release.
   The new terminal is used exclusively by British Airways and offers customers same terminal flight connections to virtually all British Airways destinations. Transferring between flights in Terminal 5 takes on average 20 minutes. Fast track security and immigration facilities are available for first and business class customers along with world class lounges that can cater for up to 2500 customers. For the customers ending their journey in London, Terminal 5 offers direct access to the Heathrow Express service to central London and the London underground. Extensive coach connections to other parts of the UK are also available, including coaches to London Gatwick airport.
   British Airways airport manager in Dhaka Mujtaba Khan said, ‘Terminal 5 offers our Bangladeshi customers the best of British Airways with seamless, hassle-free flight connections.’

The world financial crisis shows that free-market ideology is now discredited and that economies need strong state intervention to succeed, French president Nicolas Sarkozy said on Thursday.
   ‘The ideology of the dictatorship of the market ... is dead,’ he said, in a speech in which he announced that France will set up a sovereign wealth fund to ‘intervene massively’ in companies of national strategic importance.
   Historians will one day see that ‘this crisis marks the real start of the 21st century,’ he said, a century which will see the ‘return of politics’ in the running of national economies.

China signed a free-trade agreement with Singapore on Thursday, its seventh such pact widely seen as aimed at building political as well as commercial ties with other countries.
   Chinese premier Wen Jiabao and Singaporean prime minister Lee Hsien Loong witnessed the signing ceremony in Beijing, with Singapore hailing the deal as a an economic boon for the tiny Southeast Asian city-state.
   ‘China is one of the largest and fastest growing markets in the world,’ the Singaporean government said in a statement.
   ‘The agreement will enhance Singapore companies’ access to the vast Chinese market and further boost our excellent bilateral trade and investment relations.’
   Singapore’s trade with China climbed to a record high of 91.6 billion Singapore dollars (US$62b) last year and Thursday’s agreement, due to come into force at the start of 2009, was sure to see that rise further.
   China is already Singapore’s third largest trading partner and biggest investment destination. Singapore is China’s eighth-largest trading partner.
   Under the agreement, Singapore will abolish tariffs on all products imported from China from the beginning of 2009, the Chinese commerce ministry said in a statement.
   In return, China will reduce the tariff to zero on 97.1 per cent of goods imported from Singapore by January 1, 2012, it said.
   The Singaporean government said all goods from the city-state, except for about 260 products, would enjoy tariff-free access to China by 2010.
   These make up about 95 per cent of Singapore’s exports to China, with petrochemicals, processed foods and electrical products among the key items.
   Singapore also pointed out the agreement sought to open up various services sectors beyond World Trade Organisation commitments.
   ‘The sectors for which Singapore gets preferential access include business services and hospital services,’ the Singaporean government said.
   Song Seng Wun, a Singapore-based regional economist with CIMB-GK Research, said the FTA with China was of particular benefit to Singapore as it sought to cope with the economic downturn and climb out of recession.
   ‘Singapore is heavily dependent on external demand for goods and services,’ Song told AFP.
   ‘If there is a country on Mars, Singapore would have been the first to sign an FTA with the Martians.’
   For China, it is another box ticked in its campaign over the past decade to pursue free-trade deals that go beyond its WTO commitments, especially in Asia.
   Thursday’s deal is China’s seventh free trade agreement, a Chinese commerce ministry official told AFP.
   In April, New Zealand signed a free-trade agreement with Beijing, making it the first developed economy to enter such a pact with the Asian giant.
   China is also aiming to set up the world’s largest free trade area with the 10 member Association of Southeast Asian Nations by the end of the decade.
   Other nations China is in free trade talks with include Japan, South Korea and Australia, as well as Russia and some Central Asian states.
   Jia Qingguo, vice dean with the school of international relationship at Beijing University, said the FTAs with Singapore and other nations were a good way for China to build warmer political relations.
   ‘The symbolic, or political, significance is probably more important in terms of signing an FTA with Singapore,’ Jia said.
   ‘It will certainly bring economic benefits... but it will also help build a closer relationship for political cooperation. FTAs give a sense of economic integration, which requires closer political cooperation.’

The auto industry is going through a ‘dry spell’ with no end currently in sight, the chairman of Volkswagen, Europe’s biggest carmaker, said in comments published on Thursday.
   ‘We have been faced with a weak economy for some time. The financial crisis is working like a turbo. No one can say when we will come out of this valley. But we should prepare ourselves for a dry spell,’ Ferdinand Piech told the Bild daily.
   ‘We have always had cycles, sometimes with huge falls. You can always rely on there being a recovery,’ added Piech, who is also co-owner of sportscar maker Porsche which plans to increase its 35 per cent stake in VW to a majority by the end of the year.
   Carmakers have been hit hard by the financial crisis and the ensuing economic slowdown, not just in the United States where Ford, Chrysler and General Motors have been given 25 billion dollars in cheap loans but also in Europe where firms have been forced to cut or suspend production.
   Piech said that VW did not want any state subsidies but instead ‘fairer competition’ in the form a Europe-wide emissions rules that make ‘ecological and economic sense’ as well as state incentives to persuade consumers to buy low-emissions vehicles.

Europe on Thursday called for greater help from Asia in tackling the ‘unprecedented’ challenges of the global economic crisis, on the eve of a summit here between leaders of the two regions.
   However a diplomatic spat threatened to distract the two-day Asia Europe Meeting, after the European Union parliament defied warnings from China and awarded its major human rights award to a prominent Chinese dissident.
   With both continents struggling to cope with the worst economic meltdown since the Great Depression, the 43 nations belonging to ASEM were expected to see the two regions agree on tighter cooperation in tackling the turmoil.
   ‘We swim together or we sink together,’ European Commission president Jose Manuel Barroso said after arriving in Beijing, as he called for Asia and Europe to work together if they were to survive the crisis.
   ‘We need Asia to be on board, and more particularly countries like China, India and Japan,’ he told reporters, outlining the ‘unprecedented’ challenges facing the global economy, under threat of a looming worldwide recession.
   ‘I very much hope that China can make an important contribution to the solution to the financial crisis. It’s a great opportunity for China to show a sense of responsibility.’
   European governments have already committed more than two trillion dollars to banks and the money markets in a largely coordinated move to shore up their plummeting stock markets.
   Asian governments, however, have so far mostly limited their intervention to cutting interest rates, guaranteeing bank deposits and injecting money into the credit markets — without the kind of coordinated action taken by Europe.
   ‘The present gathering could not be more timely. We face challenges which don’t respect any borders,’ Barroso said.
   ‘No one in Europe or Asia can seriously pretend to be immune. We are living in unprecedented times, and we need unprecedented levels of global coordination.’
   French president Nicolas Sarkozy, whose country currently holds the rotating presidency of the European Union, has already said he would use the summit to seek Asian backing for his bid to rebuild the world’s financial system.
   China offered to cooperate more closely with the rest of the world in working to solve the economic crisis, but gave few specifics.
   ‘China’s view is that the world community should, through consultations on an equal basis, increase cooperation to jointly face the current financial crisis,’ foreign ministry spokesman Qin Gang told reporters.
   Meanwhile, a decision by the European Parliament to award its Sakharov Prize to jailed activist Hu Jia looked set to distract attention from the main focus of the talks.
   Beijing said Thursday it had urged the European Union not to award the prize to Hu and would see such a decision as interference in its internal affairs.
   ‘To issue an award to such a criminal amounts to interference in China’s judicial sovereignty and is totally against the purpose of this prize,’ Qin said before the award was announced.
   Barroso had earlier said that human rights — long a flashpoint issue between China and Europe — would be on the agenda at the talks, which are held every two years.
   ‘It’s important that we discuss all matters, including sometimes the most sensitive ones,’ Barroso said.
   Hu, 35, was sentenced to three-and-a-half years in jail in April on subversion charges after a one-day trial.
   A campaigner for human rights and AIDS victims in China, he had been a key source for foreign media on human rights and environmental violations, government abuses, judicial injustices and mistreatment of dissidents.
   Ahead of Friday’s summit, German chancellor Angela Merkel was expected to meet prime minister Wen Jiabao and president Hu Jintao late Thursday, as she looked to mend ties frayed by her meeting with the Dalai Lama.
   There were few expectations that the two days of talks Friday and Saturday would result in any major coordinated action on the financial crisis.
   That was expected to come when leaders of the world’s richest nations and biggest emerging economies gather in Washington on November 15.

Banks cut cross-border lending by 1.1 trillion dollars in the second quarter and clients withdrew a similar amount, central bank data on the severity of the global credit crisis showed on Thursday.
   Cross-border lending fell to 39.1 trillion dollars during the period, the biggest decline for a decade, figures compiled by the Bank for International Settlements, the world’s biggest central banking body, revealed.
   Banks were also hit by one trillion dollars’ worth of withdrawals, particularly by clients in the United States, Britain and Switzerland, said the BIS.
   ‘In the second quarter of 2008, BIS reporting banks’ total international claims declined by 1.1 trillion dollars at constant exchange rates to 39.1 trillion,’ said the Bank for International Settlements in its quarterly banking statistics review.
   The scale of the contraction in lending far exceeded the only other two falls posted in the decade.
   After the bursting of the dot-com bubble, lending declined by 125 billion dollars or 1.0 per cent of the total. Meanwhile, following the demise of hedge fund Long Term Capital Management in 1998, lending shrank 1.2 per cent.
   Shaken by dramatic collapses of banking titans such as Lehman Brothers, banks have been reluctant to lend to each other, resulting in a freezing of the system.
   Central banks have had to step in as last resort lenders, making massive amounts of money available to banks to prevent a meltdown of the sector.
   These latest BIS statistics indicate the severity of the problem, as it showed that during the period, cross-border inter-bank lending fell 3 per cent or 300 billion dollars.
   It was not just inter-bank lending that was hit, but also lending to individuals.
   ‘Banks owned in the euro area, the United Kingdom and the United States took the lead in reducing international claims on residents of developed countries by 848 billion dollars or 4 per cent,’ noted the BIS.
   The cutback on lending was particularly marked in short-term loans of up to and including one year, which accounted for 86 per cent of the decline in developed countries.
   Increased short-term lending suggests that banks are less willing to give long-term loans.
   But when short-term lending shrinks, it suggests that the situation has deteriorated so much that banks prefer to hold back cash and withdraw from lending.
   Even as banks cut back on lending, clients in turn withdrew huge amounts of deposits during the quarter.
   ‘Banks’ cross-border liabilities shrank by 1 trillion dollars, including drawdowns of 633 billion US dollar and 184 billion dollars in pound sterling, mostly by residents of the United States, the United Kingdom and Switzerland,’ said the BIS.
   Many major international banks, particularly those which had been hurt by the financial crisis, have been hit by asset withdrawals.
   Swiss banking giant UBS last week revealed that for the third quarter, it saw a net outflow of 83.7 billion Swiss francs worth of assets as clients took their money elsewhere.

French industrial confidence has fallen to the lowest level since 1993, the state statistics agency said on Thursday, as big employers warned of imminent business failures.
   Official forecasts already show France in its second quarter running of negative growth — a technical recesssion — and Thursday’s grim news added to a mood of gloom hanging over prospects for a recovery. ‘The financial crisis is endangering, sometimes threatening with death, many French firms, in particular medium, small and very small businesses,’ said the head of the employers’ association, Laurence Parisot.
   Parisot made her warning in a letter to prime ninister Francois Fillon in which she urged him not to impose any new taxes or social charges and to drop plans to expand a scheme to make firms pay employee travel expenses.’
   ‘For all of us, what is at stake is avoiding a deep recession,’ she said. Separately, the state statistics agency INSEE revealed a drop in its monthly index of business confidence from 91 to 88 points — putting it at its lowest level since 1993 — and warned of worse to come.

OPEC hardliners stepped up pressure on Thursday for a controversial oil production cut at an emergency meeting of the cartel on Friday to decide how to shore up prices while the world heads into a recession.
   Iran’s oil minister Gholam Hossein Nozari highlighted the split within the group over the collapse in price when he called for a two-million-barrel a day production cut as he arrived in Vienna late on Wednesday.
   ‘Two million will stabilise’ the market, Gholam Hossein Nozari told reporters and Libya, Venezuela and Qatar have also called in recent days for a cut by the Organization of Petroleum Exporting Countries.
   But Western leaders oppose such a move, with British prime minister Gordon Brown saying any reduction would be ‘scandalous’. And Gulf states led by Saudi Arabia are expected to oppose any major production cuts, analysts said.
   Kuwait’s Oil minister Mohammad al-Olaim said OPEC must take the global financial crisis into account when deciding its action.
   ‘There is a surplus in the market... and sooner or later action should be taken anyway,’ Olaim told reporters on Thursday before departing for Vienna. ‘But we are concerned about the financial crisis going on and I think any action should take into consideration the financial crisis.’
   Analysts expect the cartel to decide on a reduction of at least one million barrels per day.
   OPEC president Chakib Khelil, the Algerian energy minister, said late on Wednesday that the cartel, already suffering from the financial crisis, to be further hit by ‘very low’ oil prices.
   But he said the group had to weigh the impact of a prospective decision to cut oil output on both consumers and producers.
   OPEC produces 40 per cent of the world’s oil and its official output quota stands at 28.8 million barrels per day.
   Iran is the second largest OPEC exporter and its economy is heavily dependent on oil and gas income. Saudi Arabia is the world’s biggest crude exporter.
   Oil futures on Wednesday tumbled to 16-month lows under 65 dollars a barrel, mainly on news that demand is slumping in the United States.
   They recovered on Thursday on bargain-hunting, with Brent North Sea crude up 96 cents at 65.48 dollars a barrel in London. New York’s light sweet crude rose 99 cents to 67.74 dollars.
   But prices are down about 56 per cent from a record high of 147.5 dollars in July.
   The Vienna meeting on the impact of the global financial crisis and looming recession on the oil market was originally planned for November 18 but was brought forward as prices plunged.

South Korea’s central bank said Thursday it would raise the ceiling on its cheap loans to commercial banks in an attempt to help smaller companies survive the global credit crunch.
   The Bank of Korea said it increased the limit by 2.5 trillion won ($1.75b) to nine trillion won.
   The loans, which commercial banks pass on solely to small and medium-size firms, carry annual interest of 3.25 per cent.
   The increase, the first since October 2001, takes effect on November 3.
   ‘The need to induce banks to extend more loans to smaller firms has increased,’ senior central bank official Jang Byung-Wha told a press conference.
   ‘Financial conditions facing smaller firms are worsening as domestic demand is sluggish and local banks are strengthening their risk management.
   ‘Given a possible continuation of the financial turmoil and an outlook of a slowing economy, this situation will likely go on for a considerable period of time,’ Yonhap news agency quoted him as saying.
   Early this month plans were announced to extend liquidity of about 4.3 trillion won to smaller firms.
   On Sunday the government announced a sweeping package to mitigate the effects of the global turmoil. It announced a state guarantee of up to 100 billion dollars on banks’ foreign debts, and injected 30 billion dollars into dollar-starved banks and companies.
   Jang said Thursday’s move would also help smaller companies suffering losses on currency option contracts known as ‘knock-in knock-out.’
   The idea of the contracts was to hedge currency risks amid expectations the won’s value would not drop sharply. As it plummeted against the dollar this year, losses have risen sharply.
   The local currency was trading at 1,417.5 won to the US unit early Thursday, down 54.5 won from Wednesday’s close.
   The central bank governor Lee Seong-Tae hinted at further interest rate cuts to prevent Asia’s fourth largest economy from slowing too drastically. He indicated that inflationary pressure has eased.
   ‘The weakness in economic growth will likely persist into the first half of next year, while raw material prices are sharply lower. We will conduct the rate policy with these factors taken into account,’ Lee told parliament.
   The bank unexpectedly cut its base rate by 25 basis points earlier this month to 5.00 per cent. The next rate-setting meeting is on November 7.

The Indian government refused Thursday to bail out ailing airlines facing mounting losses but said it would extend the credit period for the cash-starved carriers to pay their fuel bills.
   Indian airlines had sought a bailout package worth 47.50 billion rupees ($1b) to survive in the face of shrinking traffic and high fuel costs.
   However Civil Aviation minister Praful Patel said no bailout was on offer but airlines would get more time to pay their fuel bills.
   ‘No financial relief has been given to the private airlines,’ he told parliament.
   But ‘the credit period for current purchases of fuel has been increased to 90 days from existing 60 days,’ he said.
   Last week, Patel said the sector was going through its ‘worst-ever phase.’
   Domestic airlines jointly owe 630 million dollars to state-held petroleum firms, according to the government.
   Fuel amounts to around 40 per cent of an airline’s operational costs.
   The sector posted a combined loss of 938 million dollars in the fiscal year to March 2008 and analysts expect losses to touch two billion dollars this year.
   Left-wing members of parliament have strongly opposed state handouts to private- and government-owned airlines.
   Last week India’s largest domestic airline, Jet Airways, struck an alliance with arch-rival Kingfisher Airlines involving code-sharing, ground-handling and route rationalisation to avert collapse.
   Airlines hiked fares to cope with higher fuel costs but this prompted a fall in passenger traffic driving them deeper into the red.
   Passenger growth has slowed from 33 per cent in 2007 to 7.5 per cent in the first half of the year and turned negative in August when 17 per cent fewer people flew compared with a year earlier.

The Prime Bank Limited held a business conference at the Bangladesh-China Friendship Conference Centre in Dhaka city on Wednesday.
   Azam J Chowdhury, chairman of the board of director of the bank, inaugurated the conference as chief guest, said a press release. Mohammad Aminul Haque, chairman of the executive committee of the board, attended the conference as special guest while M Ehsanul Haque, managing director of the bank, presided over the conference.
   Hasina Khan, vice chairperson, Mohammad Delwar Hossain, director, Nasiruddin Ahmed, additional managing director, Mahbubul Alam and Mehmood Husain deputy managing directors, and senior officials of the bank were present in the conference. Md Tabarak Hossain Bhuiyan, executive vice-president of the bank, conducted the conference.

Mobile phone operator AKTEL has introduced a new tariff plan. The call rates are at 68 paisa per minute for both prepaid and postpaid connections, which will remain same 24 hours a day to any mobile.
   AKTEL has also offered Tk 68 for SIM replacement or ownership change for all customers to simplify the user experience. AKTEL has also reduced connection prices, prepaid to Tk 399 and postpaid to Tk 499, said a press release.
   AKTEL has also offered 50 per cent discount in VAS. All the existing and new customers can now enjoy 50 per cent discount in call block, phone backup and missed call alert.
   Jefri Ahmed Tambi, chief executive officer and managing director of AKTEL, announced the new tariff plan of the mobile phone operator at a meet-the-press programme held in Dhaka city on Wednesday.
   Bidyut Kumar Basu, chief commercial officer of AKTEL, also attended the press meet.

The euro fell on Thursday to multi-year lows amid another turbulent day for stock markets, as fears grew that the worldwide economic slowdown would hit Europe hard, dealers said.
   The single European currency slid to 1.2728 dollars in early Asian trading, which was the lowest level since November 7, 2006. At one stage the euro also hit 123.43 yen, a level not seen since December 2002.
   In London morning deals, the euro pulled back to stand at 1.2833 dollars, down from 1.2867 late in New York on Wednesday.
   The European single currency has now shed more than 20 per cent of its value since striking a record high of 1.6038 dollars in July. Against the Japanese currency on Thursday, the dollar eased to 97.78 yen from 97.79 yen.
   ‘Euro/dollar remains under pressure,’ said Commerzbank analyst Antje Praefcke in a research note to clients.
   ‘The new low... will probably not last very long. Currently, worldwide recession fears generate some tailwind for the greenback.’
   ‘In the foreign exchange market’s opinion, the US will manage to get out of recession much faster than the eurozone will.’
   The South Korean won also took a beating on rising concern that Asia’s fourth largest economy would suffer disproportionately from a global downturn.
   Contributing to a sharp fall on the Japanese equities market, the yen gained strength as investors who had binged on the low-yielding currency unwound their risky bets.
   Against the Japanese currency, the euro later rebounded to 125.52 yen in London morning trade, still down from 125.82 in New York late Wednesday.
   ‘People are concerned about the financial crisis globally, especially in Europe. That tends to weaken the euro against the dollar,’ said Tomoko Fujii, head of economics and strategy at Bank of America in Tokyo.
   The European Central Bank has room for several further interest rate cuts, which would mean the euro would no longer be as attractive compared with the dollar and yen, she added.
   The Swedish central bank meanwhile slashed its key interest rate on Thursday by half a percentage point to 3.75 percent and said it planned to make further cuts within six months.
   The Czech koruna fell further against the euro on Thursday, hitting the lowest point since the end of January because of concern among investors about the stability of economies in central Europe, notably because of strains in Hungary. In Asia, the Hong Kong Monetary Authority on Thursday intervened in the foreign exchange market, buying 3.88 billion Hong Kong dollars (US$500m) worth of US dollars to maintain the local currency’s peg to the greenback.
   A spokesman for the HKMA, the city’s de facto central bank, said there had been increased demand for Hong Kong dollars in recent days. In London morning trading on Thursday, the euro changed hands at 1.2833 dollars against 1.2867 late Wednesday, at 125.52 yen (125.82), 0.7870 pounds (0.7894) and 1.4972 Swiss francs (1.4947).
   The dollar stood at 97.78 yen (97.79) and 1.1663 Swiss francs (1.1615). The pound was at 1.6313 dollars (1.6297).
   On the London Bullion Market, the price of gold fell to 727.62 dollars an ounce from 744 dollars late on Wednesday.

Oil prices rose on Thursday, pulling away from 16-month low points before an OPEC meeting which was expected to cut oil output to shore up prices despite strengthening winds of recession, dealers said.
   The market had fallen heavily on Wednesday on news that demand for crude was flagging in major consumer the United States, the world’s biggest energy consumer.
   On Thursday, Brent North Sea crude for December delivery gained 1.38 dollars to 65.90 dollars per barrel. Brent had hit a low of 63.96 the previous day that was last witnessed in March 2007.
   New York’s main contract, light sweet crude for December delivery, rose 1.37 dollars to 68.12 dollars a barrel on Thursday, after touching 66.20 dollars on Wednesday — last seen in June 2007.
   ‘Crude prices were higher on Thursday following yesterday’s hefty losses and on the increased possibility that OPEC could cut by more than the 1.0 million barrels per
   day widely expected by
   market participants,’ said Sucden analyst Nimit Khamar in London.

Transaction
   Premier Leasing
   ASM Feroz Alam, one of the sponsors of the company, has reported his intention to sell 1,05,000 shares (in the block market) out of his total holdings of 3,64,662 shares of the company at prevailing market price through the stock exchange within next 30 working days.
   
   IFIC Bank
   Murshed Murad Ibrahim, one of the directors of the Bank, has reported his intention to sell 56,896 shares out of his total holdings of 81,624 shares of the bank at prevailing market price through the stock exchange within next 30 working days.
   
   Dividend
   Al-Haj Textile
   The board of directors has recommended 20 per cent stock dividend (i.e. one bonus share for every five existing shares) for the year 2007- 2008. The annual general meeting of the company will be held on December 29. Book closure will be from December 22 to 29.
   
   Profit
   DESCO
   The company has reported profit after tax of Tk 100.08 crore with earning per share of Tk 78.73 as on June 30, 2008 as against Tk 71.11 crore and Tk 55.94 respectively as on June 30, 2007.
   Source: DSE

ICQCC conference begins today
About 700 quality management experts from 15 Asian countries have gathered in Dhaka to attend the International Conference on Quality Control Circle 2008, beginning today. Commerce adviser Hossain Zillur Rahman will inaugurate the three-day conference in Dhaka Sheraton Hotel. Bangladesh Society for Total Quality Management has organised the conference, where over 100 case studies on quality management in various industrial and services sectors will be discussed.
— UNB

FBCCI, Philippines Chamber sign MoU
The Federation of Bangladesh Chambers of Commerce and Industry and the Philippine Chamber of Commerce and Industry signed a memorandum of understanding in Manila on Thursday to further promote bilateral trade between the two countries. Abu Alam Chowdhury, vice president of FBCCI, and Edgardo G Lacson, president of PCCI, signed the MoU on behalf of their respective sides. A 12-member Bangladesh delegation, led by the FBCCI president, is now in Manila to attend the three-day 22nd Confederation of Asia-Pacific Chambers of Commerce and Industry conference which started Wednesday. On the first day of the conference, Bangladesh was elected vice president of the CACCI, said a message received in Dhaka on Thursday. The MoU envisaged, among other things, establishment of the Bangladesh-Philippine Business Council in Dhaka and the Philippine-Bangladesh Business Council in Manila.
— UNB