NEWS UPDATE--------------------APRIL 20, 2010
BANGLADESH
Market prices don’t match DCC chart rates
Retailers in the Dhaka City Corporation’s kitchen markets charge much higher prices for different items than what the city corporation’s charts say.
Glaring differences were noticed between what a shopper has to pay and what the price charts, hung by retailers at Karwan Bazaar and Mohakhali Kitchen Market in the city.
The charts at the retail outlets at Karwan Bazar on Sunday showed the coarse rice price per kilogram between Tk 23 and 25, but buyers there had to pay Tk 26-30.
The price of coarse flour in packets was shown to be Tk 21-23 per kg, but the retailers charged Tk 23 or 24.
One kg of sugar cost between Tk 42 and 44, though the charts showed it to be between Tk 40 and 42.
Mungdal sold for Tk 130 a kg, against Tk 120-122 shown in the charts.
Soya bean oil, not bottled, sold for Tk 78 to 82 per litre and not Tk 76 or 77.
The buyers had to pay between Tk 90 to 100 per kg of ginger though the charts showed the price between Tk 75 to 80.
Onion cost Tk 18 to 20 per kg and not Tk 15 to 18, garlic – Tk 88 to 120 instead of Tk 80 to 85.
‘I heard that a functionary of the government visits the market occasionally to write the prices on this board. I don’t know how they relate to the market reality,’ said Munna Mia, a Karwan Bazar retailer.
Some of the prices, written with a chalk, on the notice board of Mohakhali Bazar Sunday afternoon were hardly readable.
Several ministers of the present and past governments time and again said retailers would need to sell goods at the prices quoted on the board.
The city mayor Sadeque Hossain Khoka admitted that real prices of commodities might vary with prices on the board as those prices were sometimes written whimsically.
‘City corporation employees who look after the kitchen markets and sometimes people in the market committees write these prices. These prices are either the lowest available prices or just samples,’ he said.
‘There is no price fixation authority in the government and no specific rules for quoting prices. So how will we ensure the right prices on the board?’ Khoka asked.
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NEWS IN FOCUS
Trade with China on a robust rise again
The country’s trade with its largest trading partner China increased robustly in the first two months of the current year indicating a rise on raw-materials and equipment procurement by industries and consumers goods by importers.
Analyst pointed out that a massive rise in imports from China might have been caused by importers diverting their procurements to China while strengthening of Indian Rupee made procurements from India costlier.
Sources at the office of the chief controller of exports and imports told New Age that Bangladesh-China trade increased by 58 per cent to $820 million in January-February of the current year.
Imports from China increased by 59 per cent to $790 million in the period while exports amounted $20 million with 35 per cent year-on-year growth, said one senior official, citing a latest report of Chinese government.
Bangladesh’s major imports from China include fabrics, non-cotton yarn and accessories for garment industries, machineries, chemicals, intermediary raw-materials for industries and fertilisers.
Hundreds of consumer goods including electrical and electronic appliances, furniture, footwear, glassware, plastic products, toys, and food items including spices and fruits also make significant amounts in import bills.
‘Imports from China made unexpected growth in the first two months of the current year indicating that local industries are on the recovery of productions,’ said a senior official at the office of chief controller of exports and imports.
He pointed out that with the Indian Rupee becoming stronger Indian suppliers might have lost their competitiveness with the China getting more orders from the Bangladeshi importers.
If formal trade is considered, India is the second largest source for industrial raw-materials and consumer goods imported in Bangladesh. In recant years, Indian suppliers have been facing a fierce competition in Bangladesh from their Chinese counterparts.
In 2009, the two-way trade between Bangladesh and China valued at $4.58 billion registering a 2.2 per cent negative growth against the bilateral trade worth $4.8 billion the previous year.
In the past year, Bangladesh’s imports from China amounted to $4,442 million and 2.5 per cent decline on previous year’s imports worth $4,556 million. Exports in 2009 had registered 7 per cent increase year-on-year to $141 million.
Trade analysts attributed that decline in Bangladesh’s imports, especially raw materials and machinery, to the effects of the global recession on Bangladesh’s export industries, especially in the last half of last year.
Bangladesh’s exports to China, for years, remain trapped in a low turnover and product base with significant shipments of raw jute, jute goods, leather and some dehydrated sea fish.
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STOCK MARKET
DSE breaks five-day losing streak
Dhaka stocks bounced back on Monday after a five-day bear run with the DSE general index gaining 61.93 points.
The benchmark index of Dhaka Stock Exchange increased by 1.13 per cent to close at 5,529.05. The DSE all share price index also increased by 49.90 points, or 1.11 per cent, to finish at 4,538.62.
‘The market gained today (Monday) as investors were expecting good financial reports from a number of companies,’ a DSE director said.
Most of the traded issues gained on the day. Of the total 245 issues traded, 175 advanced, 63 declined, and seven remained unchanged.
The country’s premier bourse saw a total turnover of Tk 963.71 crore on Monday, up by Tk 55.75 crore from the total turnover on Sunday.
Beximco topped the turnover leaders with a total transaction of Tk 80.52 crore.
Grameenphone, Premier Bank, Social Islami Bank, Beximco Pharmaceuticals, Prime Finance & Investment, DESCO, Summit Power, LankaBangla Finance, and Al-Arafah Islami Bank were the rest of the top 10 turnover leaders on the day.
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NEWS
ADB asks govt to invest more in power, gas, water sectors
The Asian Development Bank has identified three acute crises—shortage of power, gas and water—as the main obstacles to Bangladesh’s steady development and asked the government to invest more in these sectors.
‘Bangladesh is now suffering from three types of crises—shortage of power, gas and water… and we are ready to lend financial support for developing these key sectors,’ said visiting ADB director general for South Asia Sultan Hafeez Rahman after having talks with finance minister Abul Maal Abdul Muhith at his secretariat office on Monday.
ADB country director in Dhaka Paul J Heytens was also present at the meeting with the finance minister.
The finance minister admitted the statement of ADB DG and said, ‘We are really in the midst of three kinds of crises and the country will need financial assistance to overcome the crises’.
Sultan Hafeez Rahman assured that ADB would provide more funds for the country’s new private sector independent power projects to which the government is giving priority.
‘The government needs more funds to set up the IPP power plants but they don’t have enough funds,’ he observed, adding that the government would have to restore the Public Private Partnership projects and should be ready to invest in the PPP projects.
Sultan Hafeez also recalled that ADB had invested in the Meghnaghat Power Plant.
‘We have decided to double the yearly assistance to Bangladesh and in the next three years ADB will provide Bangladesh $3.3 billion or Tk 23,100 crore,’ Hafeez said. Earlier, the ADB assistance was worth only $600 million yearly.
The finance minister said ADB has assured that they were ready to provide funds for constructing the Padma bridge work on which would start from January next year.
‘ADB has also provided funds to Bangladesh for developing regional corporation and was ready to invest for construction of power distribution line from India through Agartala which would start from next year,’ he said.
Finance minister said ADB also invested in the country’s railway reform project. ‘They want to know about next fiscal year’s budget and I told them about amending the VAT laws from next fiscal year,’ he added.
The ADB DG arrived in Dhaka on Saturday on a five-day official visit.
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WORLD ECONOMY
‘Muslim nations laughing
at EU debt woes’
Muslim nations are ‘laughing’ at European efforts to grapple with a debilitating debt crisis in Greece, which has serious ramifications for the world’s biggest open market, the head of the World Islamic Economic Forum has said.
Former Malaysian deputy prime minister Tun Musa Hitam spoke to the AFP in Brussels as European Union plans for a backstop bailout enabling Athens to refinance tens of billions of euros of debt repayments and budget commitments were being thrashed out among eurozone officials.
‘Seen from the east, from developing countries, we’re laughing because they’re not doing what they taught us,’ Tun Musa said of the EU’s decision to protect Greece rather than sending Athens to the International Monetary Fund.
‘You find that a European nation has adopted anything but good practice, which has resulted in a disaster (and) now the name and the prestige of the European Union is at stake, but more importantly, its economies,’ he added.
‘The normal way of resolving these issues is to go to the IMF. Developing countries do that, but not the EU.
‘It’s yes, no, maybe every day,’ he said.
Tun Musa was speaking before eurozone finance ministers agreed last Sunday to pump some 30 billion euros ($41b) into Greece’s coffers this year if necessary — at below-market rates of around five per cent interest.
But in the aftermath of the accord doubts have emerged as to the readiness and scale of the financial aid, with a series of political hurdles still to be crossed before these monies can ever be handed over.
And within no time, new nationwide strikes had pushed Greek borrowing rates back through the pain barrier.
With parallel EU negotiations with the IMF under way on its involvement, and 15 billion euros of loans anticipated in 2010 from Washington, Tun Musa maintained that the Western system where ‘anything goes in terms of lending and conduct’ lay behind the Greek fiscal disaster.
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BANGLADESH
NEWS
Expats’ welfare ministry to set up wing for overseas market
The expatriate welfare and overseas employment ministry has will establish a new wing titled Employment Policy and Research Wing to explore new markets abroad for the Bangladeshi manpower.
‘The new wing comprising 38 posts headed by a joint secretary got the inter-ministerial approval last week and we already requested the establishment secretary to recruit officials and staffs for it,’ said acting secretary of the ministry Zafar Ahmed Khan on Monday.
He said the main objective of this wing is to explore new destinations for the Bangladeshi job seekers abroad side by side with monitoring situation of the overseas job market and finding new opportunities.
‘This wing will also look after welfare of the expatriate workers and see to any harassment to them in foreign countries.’
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WORLD ECONOMY
Citi posts $4.4b profit in Q1
US banking giant Citigroup posted a profit of $4.4 billion in the first quarter of this year, the company said on Monday, reporting its best figures since early 2007.
Following on from blockbuster results reported by Citi rivals last week, the New York-based bank returned to the black after losing $7.6 billion in the last quarter of 2009.
The company has struggled since the start of the financial crisis and required a government bailout of $45 billion to stay afloat.
The beleaguered global bank lost $1.6 billion in 2009, and a whopping $27.6 billion in 2008, when the collapse of rival US investment bank Lehman Brothers propelled the worst financial crisis in decades.
Chief executive Vikram Pandit said the company had now turned a corner.
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Oil plunges below $82
Oil prices plunged below $82 a barrel Monday in Asia, extending big losses on expectations that disruption to air travel from the Icelandic volcano will undermine the global economic recovery and crude demand.
Benchmark crude for May delivery was down $1.62 to $81.62 a barrel at late afternoon Singapore time in electronic trading on the New York Mercantile Exchange.
A huge cloud of volcanic ash has shut down air traffic in most of Europe for four days — stranding passengers and scuttling travel plans and freight services that could end up costing billions of dollars.
At the very least, traders say the volcano crisis will lower demand from airlines for jet fuel.
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World stocks fall on volcano, Goldman jitters
Monday on concerns over potential broader implications for banks of the US fraud case against investment bank Goldman Sachs and the impact on airlines from the Iceland volcano.
In Asia, markets fell after China announced measures to cool housing prices.
London’s FTSE 100 and France’s CAC-40 were both down 0.7 per cent, while Germany’s DAX was off 0.48 per cent by 12:45pm London time (7:45am EST). US stock futures were down slightly, extending their slide from Friday.
In the US the Dow Jones industrial average futures fell 54 points, or 0.54 per cent, to 10,930. Standard & Poor’s 500 index futures fell 6.60, or 0.6 per cent, to 1,183.70, while Nasdaq 100 index futures fell 10.00, or 0.5 per cent, to 1,999.75.
The drop built on
Friday’s 125-point plummet, which came after the SEC announced charges against Goldman.
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Airline losses from ash spiral over $1 billion
As airline losses from the volcanic ash cloud spiralled over $1 billion on Monday, airlines started demanding EU compensation and the aviation industry sharply criticised European governments for not using scientific measures to evaluate the ash and open up their airspace.
Shares of some European airlines fell as flight disruptions from the volcanic cloud moved into a fifth day, and the International Air Transport Association complained of ‘no leadership’ from government leaders — one of whom admitted to EU dissension about how to respond.
‘It’s embarrassing, and a European mess,’ IATA CEO Giovanni Bisignani told The Associated Press. ‘It took five days to organise a conference call with the ministers of transport and we are losing $200 million per day (and) 750,000 passengers are stranded all over. Does it make sense?’
European civil aviation authorities held a conference call Monday about what steps could be taken toward opening airspace, and transport ministers from all 27 EU member states were to hold another later in the day.
Dominique Bussereau, France’s transport minister, told reporters Monday that he had urged EU president Spain ever since Saturday to call the ministerial meeting immediately — but Madrid declined.
‘Naturally, it would have been better if had taken place Sunday or Saturday,’ Bussereau said.
British Airways said airlines have asked the EU for financial compensation for the closure of airspace, starting last Wednesday. With London among the first hubs shut down, the British carrier said it’s losing as much as 20 million pounds ($30 million) per day.
BA chief executive Willie Walsh said European airlines have asked the EU and national governments for financial compensation for the closure of airspace. He pointed to a precedent: compensation paid to airlines after the closure of US airspace following the September 11, 2001 terrorist attacks.
‘This is an unprecedented situation that is having a huge impact on customers and airlines alike,’ Walsh said. ‘We continue to offer as much support as we can to our customers, however, these are extraordinary circumstances that are beyond all airlines’ control.’
Environment minister Jean-Louis Borloo — the No. 2 in the French Cabinet — said a meeting was planned Tuesday of French airlines, travel agencies and the government to examine possible state aid to the industry.
‘This aid will evolve of course based on the severity of the crisis. For that, we need a European pre-accord that we have obtained — an accord in principle so this sector aid can be allocated,’ Borloo told France’s i-Tele.
The IATA, in a statement, called on governments to place ‘greater urgency and focus on how and when we can safely reopen Europe’s skies’ — such as through more in-depth study of the ash cloud.
‘We have to not just use — as the Europeans were doing — a theoretical model, let’s try to use figures and facts,’ Bisignani said.’ It means sending test planes at certain kinds of altitudes to check what was the situation with the ashes.’
While the association says ‘safety is our top priority,’ Bisignani said in the statement that its member airlines have run test flights with no problems and ‘they report missed opportunities to fly safely.’
Bisignani said that Europe — unlike the United States, for example — is ‘not well-equipped’ when it comes to planes that can test the air quality in the skies. He estimated that once flights in Europe do resume, it would take three to six days for traffic to return to normal.
France’s Borloo said disparate analyses needed to be brought together based on ‘real tests on real planes with real pilots,’ so some air ‘corridors’ could be reopened.
‘The issue today is not to reopen all European commercial airspace, the issue today is to increase the ability to reopen corridors to allow the general de-congestion of European traffic,’ he told reporters. ‘The desire of France — without taking risk — is to open corridors as much as possible and as quickly as possible.’
Pierre-Henri Gourgeon, the No. 2 executive at Air France-KLM, said his company is losing euro35 million a day and called for more test flights to see if routes are safe to fly. He said the French-Dutch carrier conducted five test flights on its own Sunday and planned another seven Monday.
Speaking to reporters Monday at Air France headquarters near Paris’ main airport, Gourgeon said aviation authorities had relied on ‘insufficient’ information when they imposed a near-blanket flight ban in some countries.
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East Asia could stabilise emissions by 2025: WB
East Asia could stabilise its greenhouse gas emissions by 2025 while maintaining economic growth by investing heavily in energy efficiency and low-carbon technologies, the World Bank said Monday.
Achieving this would require the region’s energy guzzlers to invest an extra $80 billion a year to make power, industry and transport sectors more efficient and develop renewable energy, the World Bank said.
Success also depends on the region finding the political will for big changes as well as transfers of financing and technologies from developed countries, the Washington-based lender said in a regional energy report.
‘Major investments in energy efficiency and a concerted switch to renewable sources of power... could simultaneously stabilise greenhouse gas emissions, increase energy security while improving local environments,’ the report said.
But the World Bank warned time was running out and urged policymakers in energy-hungry China, Indonesia, Malaysia, the Philippines, Thailand and Vietnam to act quickly.
‘While many East Asian countries are taking steps in these directions, accelerating the speed and scaling up the efforts are needed to get on to a sustainable energy path,’ it said.
‘The window of opportunity is closing fast, because delaying action would lock the region into a long-lasting high-carbon infrastructure.’
If countries act, regional carbon emissions could stabilise by 2025 and begin to decline, said the bank, which provides financial and technical aid to developing nations.
It said carbon emissions could be limited to 9.2 gigatonnes a year by 2030 — 37 per cent lower than the World Bank’s estimated level if governments stick to their current climate change policies.
Achieving the target depends largely on China, which accounts for 80 per cent of energy consumption and 85 per cent of regional carbon emissions, it said.
The world’s third-largest economy will need to reduce its carbon emissions as a percentage of economic growth by an even greater margin than currently planned, the bank said.
It called that a ‘daunting goal,’ given that China is still a developing country relying on energy-intensive, heavy-polluting industries.
It also noted that major policy and institutional reforms as well as big lifestyle changes would be needed throughout the region to achieve the goal.
‘Developing countries will need to avoid the carbon-intensive path and wasteful lifestyles followed by industrial countries in the past,’ the bank said.
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China steps up efforts to curb property prices
China has moved to further curb real estate speculation by telling banks they will be allowed to refuse additional mortgages to buyers who own two or more properties.
The move comes soon after the government last week raised the minimum down payment for second home purchases as authorities try to rein in the market with the economy growing at a blistering pace.
Under the new rules, announced at the weekend, banks can also refuse loans to people who cannot prove they have lived and paid taxes for at least one year in the city where they intend to buy, the State Council, or cabinet, said.
Last week the State Council raised the minimum down payment for second home purchases to 50 per cent and set a minimum 30 per cent deposit on first homes bigger than 90 square metres (970 square feet).
The latest moves highlight growing concern in China that the property market is overheating, after prices in major cities rose 11.7 per cent year-on-year last month, the fastest since the survey was widened to 70 cities in July 2005.
The State Council also renewed a pledge last week to rein in runaway prices by increasing the supply of land for construction, accelerating the building of affordable housing and cracking down on speculative activity.
But Royal Bank of Canada senior analyst Brian Jackson said the measures would not be as effective as higher interest rates.
‘I have very strong doubts that is going to be enough to get the results they want in terms of slowing down the property market and eventually they will have to use blunter instruments,’ Jackson told AFP.
China is trying various ways to prevent the growth of asset bubbles as the nation’s economy surges — it grew 11.9 per cent in the further three months of the year – and keep a lid on inflation.
Beijing has been clamping down on bank lending which has been blamed for fuelling speculative investment in the property sector.
Policymakers have raised bank reserve ratios twice this year — effectively limiting the amount banks can lend — and increased interest rates on benchmark three-month and one-year Treasury bills.
Analysts have forecast interest rate hikes as early as this month as well as a loosening of exchange rate policy, which has effectively pegged the yuan to the dollar since mid-2008.
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Toyota accepts $16.4m fine: US official
Japanese auto giant Toyota was expected to sign legal documents Monday, agreeing to pay the US government a record fine of nearly $16.4 million for concealing gas pedal defects.
‘By paying the full civil penalty Toyota is accepting responsibility for hiding the safety defect ... in violation of the law,’ a senior US government official told AFP late Sunday.
A Toyota spokesman declined to comment. But a well-informed source told AFP the automaker was expected to sign the necessary legal documents early Monday.
‘They’ve agreed to pay the maximum fine in record time, the most we can get,’ the source said. ‘They have 30 days to pay.’
Earlier this month, the US Department of Transportation said it was seeking ‘the maximum civil penalty of $16.375 million against Toyota’ after it failed to report its safety defects in a timely manner.
Toyota had failed to report ‘the dangerous ‘sticky pedal’ defect for at least four months, despite knowing of the potential risk to consumers,’ said the National Highway Traffic Safety Administration, the department’s watchdog.
It is the largest civil fine against an automaker ever sought by the NHTSA.
Toyota has recalled around 2.3 million cars in the United States for the pedal defect.
Worldwide it has recalled more than eight million cars over several problems, including the sticking accelerator pedal which caused cars to speed out of control.
Toyota had until Monday to agree to pay the fine, or contest it. If the two parties had not agreed a settlement, the matter could have gone to court.
The sudden acceleration problem allegedly caused by the gas pedal defects has been blamed for more than 50 deaths in the United States, and Toyota faces a slew of legal challenges in US courts.
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BANGLADESH
Market prices don’t match DCC chart rates
Retailers in the Dhaka City Corporation’s kitchen markets charge much higher prices for different items than what the city corporation’s charts say.
Glaring differences were noticed between what a shopper has to pay and what the price charts, hung by retailers at Karwan Bazaar and Mohakhali Kitchen Market in the city.
The charts at the retail outlets at Karwan Bazar on Sunday showed the coarse rice price per kilogram between Tk 23 and 25, but buyers there had to pay Tk 26-30.
The price of coarse flour in packets was shown to be Tk 21-23 per kg, but the retailers charged Tk 23 or 24.
One kg of sugar cost between Tk 42 and 44, though the charts showed it to be between Tk 40 and 42.
Mungdal sold for Tk 130 a kg, against Tk 120-122 shown in the charts.
Soya bean oil, not bottled, sold for Tk 78 to 82 per litre and not Tk 76 or 77.
The buyers had to pay between Tk 90 to 100 per kg of ginger though the charts showed the price between Tk 75 to 80.
Onion cost Tk 18 to 20 per kg and not Tk 15 to 18, garlic – Tk 88 to 120 instead of Tk 80 to 85.
‘I heard that a functionary of the government visits the market occasionally to write the prices on this board. I don’t know how they relate to the market reality,’ said Munna Mia, a Karwan Bazar retailer.
Some of the prices, written with a chalk, on the notice board of Mohakhali Bazar Sunday afternoon were hardly readable.
Several ministers of the present and past governments time and again said retailers would need to sell goods at the prices quoted on the board.
The city mayor Sadeque Hossain Khoka admitted that real prices of commodities might vary with prices on the board as those prices were sometimes written whimsically.
‘City corporation employees who look after the kitchen markets and sometimes people in the market committees write these prices. These prices are either the lowest available prices or just samples,’ he said.
‘There is no price fixation authority in the government and no specific rules for quoting prices. So how will we ensure the right prices on the board?’ Khoka asked.
…………………………………………
NEWS IN FOCUS
Trade with China on a robust rise again
The country’s trade with its largest trading partner China increased robustly in the first two months of the current year indicating a rise on raw-materials and equipment procurement by industries and consumers goods by importers.
Analyst pointed out that a massive rise in imports from China might have been caused by importers diverting their procurements to China while strengthening of Indian Rupee made procurements from India costlier.
Sources at the office of the chief controller of exports and imports told New Age that Bangladesh-China trade increased by 58 per cent to $820 million in January-February of the current year.
Imports from China increased by 59 per cent to $790 million in the period while exports amounted $20 million with 35 per cent year-on-year growth, said one senior official, citing a latest report of Chinese government.
Bangladesh’s major imports from China include fabrics, non-cotton yarn and accessories for garment industries, machineries, chemicals, intermediary raw-materials for industries and fertilisers.
Hundreds of consumer goods including electrical and electronic appliances, furniture, footwear, glassware, plastic products, toys, and food items including spices and fruits also make significant amounts in import bills.
‘Imports from China made unexpected growth in the first two months of the current year indicating that local industries are on the recovery of productions,’ said a senior official at the office of chief controller of exports and imports.
He pointed out that with the Indian Rupee becoming stronger Indian suppliers might have lost their competitiveness with the China getting more orders from the Bangladeshi importers.
If formal trade is considered, India is the second largest source for industrial raw-materials and consumer goods imported in Bangladesh. In recant years, Indian suppliers have been facing a fierce competition in Bangladesh from their Chinese counterparts.
In 2009, the two-way trade between Bangladesh and China valued at $4.58 billion registering a 2.2 per cent negative growth against the bilateral trade worth $4.8 billion the previous year.
In the past year, Bangladesh’s imports from China amounted to $4,442 million and 2.5 per cent decline on previous year’s imports worth $4,556 million. Exports in 2009 had registered 7 per cent increase year-on-year to $141 million.
Trade analysts attributed that decline in Bangladesh’s imports, especially raw materials and machinery, to the effects of the global recession on Bangladesh’s export industries, especially in the last half of last year.
Bangladesh’s exports to China, for years, remain trapped in a low turnover and product base with significant shipments of raw jute, jute goods, leather and some dehydrated sea fish.
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STOCK MARKET
DSE breaks five-day losing streak
Dhaka stocks bounced back on Monday after a five-day bear run with the DSE general index gaining 61.93 points.
The benchmark index of Dhaka Stock Exchange increased by 1.13 per cent to close at 5,529.05. The DSE all share price index also increased by 49.90 points, or 1.11 per cent, to finish at 4,538.62.
‘The market gained today (Monday) as investors were expecting good financial reports from a number of companies,’ a DSE director said.
Most of the traded issues gained on the day. Of the total 245 issues traded, 175 advanced, 63 declined, and seven remained unchanged.
The country’s premier bourse saw a total turnover of Tk 963.71 crore on Monday, up by Tk 55.75 crore from the total turnover on Sunday.
Beximco topped the turnover leaders with a total transaction of Tk 80.52 crore.
Grameenphone, Premier Bank, Social Islami Bank, Beximco Pharmaceuticals, Prime Finance & Investment, DESCO, Summit Power, LankaBangla Finance, and Al-Arafah Islami Bank were the rest of the top 10 turnover leaders on the day.
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NEWS
ADB asks govt to invest more in power, gas, water sectors
The Asian Development Bank has identified three acute crises—shortage of power, gas and water—as the main obstacles to Bangladesh’s steady development and asked the government to invest more in these sectors.
‘Bangladesh is now suffering from three types of crises—shortage of power, gas and water… and we are ready to lend financial support for developing these key sectors,’ said visiting ADB director general for South Asia Sultan Hafeez Rahman after having talks with finance minister Abul Maal Abdul Muhith at his secretariat office on Monday.
ADB country director in Dhaka Paul J Heytens was also present at the meeting with the finance minister.
The finance minister admitted the statement of ADB DG and said, ‘We are really in the midst of three kinds of crises and the country will need financial assistance to overcome the crises’.
Sultan Hafeez Rahman assured that ADB would provide more funds for the country’s new private sector independent power projects to which the government is giving priority.
‘The government needs more funds to set up the IPP power plants but they don’t have enough funds,’ he observed, adding that the government would have to restore the Public Private Partnership projects and should be ready to invest in the PPP projects.
Sultan Hafeez also recalled that ADB had invested in the Meghnaghat Power Plant.
‘We have decided to double the yearly assistance to Bangladesh and in the next three years ADB will provide Bangladesh $3.3 billion or Tk 23,100 crore,’ Hafeez said. Earlier, the ADB assistance was worth only $600 million yearly.
The finance minister said ADB has assured that they were ready to provide funds for constructing the Padma bridge work on which would start from January next year.
‘ADB has also provided funds to Bangladesh for developing regional corporation and was ready to invest for construction of power distribution line from India through Agartala which would start from next year,’ he said.
Finance minister said ADB also invested in the country’s railway reform project. ‘They want to know about next fiscal year’s budget and I told them about amending the VAT laws from next fiscal year,’ he added.
The ADB DG arrived in Dhaka on Saturday on a five-day official visit.
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WORLD ECONOMY
‘Muslim nations laughing
at EU debt woes’
Muslim nations are ‘laughing’ at European efforts to grapple with a debilitating debt crisis in Greece, which has serious ramifications for the world’s biggest open market, the head of the World Islamic Economic Forum has said.
Former Malaysian deputy prime minister Tun Musa Hitam spoke to the AFP in Brussels as European Union plans for a backstop bailout enabling Athens to refinance tens of billions of euros of debt repayments and budget commitments were being thrashed out among eurozone officials.
‘Seen from the east, from developing countries, we’re laughing because they’re not doing what they taught us,’ Tun Musa said of the EU’s decision to protect Greece rather than sending Athens to the International Monetary Fund.
‘You find that a European nation has adopted anything but good practice, which has resulted in a disaster (and) now the name and the prestige of the European Union is at stake, but more importantly, its economies,’ he added.
‘The normal way of resolving these issues is to go to the IMF. Developing countries do that, but not the EU.
‘It’s yes, no, maybe every day,’ he said.
Tun Musa was speaking before eurozone finance ministers agreed last Sunday to pump some 30 billion euros ($41b) into Greece’s coffers this year if necessary — at below-market rates of around five per cent interest.
But in the aftermath of the accord doubts have emerged as to the readiness and scale of the financial aid, with a series of political hurdles still to be crossed before these monies can ever be handed over.
And within no time, new nationwide strikes had pushed Greek borrowing rates back through the pain barrier.
With parallel EU negotiations with the IMF under way on its involvement, and 15 billion euros of loans anticipated in 2010 from Washington, Tun Musa maintained that the Western system where ‘anything goes in terms of lending and conduct’ lay behind the Greek fiscal disaster.
…………………………………………
BANGLADESH
NEWS
Expats’ welfare ministry to set up wing for overseas market
The expatriate welfare and overseas employment ministry has will establish a new wing titled Employment Policy and Research Wing to explore new markets abroad for the Bangladeshi manpower.
‘The new wing comprising 38 posts headed by a joint secretary got the inter-ministerial approval last week and we already requested the establishment secretary to recruit officials and staffs for it,’ said acting secretary of the ministry Zafar Ahmed Khan on Monday.
He said the main objective of this wing is to explore new destinations for the Bangladeshi job seekers abroad side by side with monitoring situation of the overseas job market and finding new opportunities.
‘This wing will also look after welfare of the expatriate workers and see to any harassment to them in foreign countries.’
…………………………………………
WORLD ECONOMY
Citi posts $4.4b profit in Q1
US banking giant Citigroup posted a profit of $4.4 billion in the first quarter of this year, the company said on Monday, reporting its best figures since early 2007.
Following on from blockbuster results reported by Citi rivals last week, the New York-based bank returned to the black after losing $7.6 billion in the last quarter of 2009.
The company has struggled since the start of the financial crisis and required a government bailout of $45 billion to stay afloat.
The beleaguered global bank lost $1.6 billion in 2009, and a whopping $27.6 billion in 2008, when the collapse of rival US investment bank Lehman Brothers propelled the worst financial crisis in decades.
Chief executive Vikram Pandit said the company had now turned a corner.
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Oil plunges below $82
Oil prices plunged below $82 a barrel Monday in Asia, extending big losses on expectations that disruption to air travel from the Icelandic volcano will undermine the global economic recovery and crude demand.
Benchmark crude for May delivery was down $1.62 to $81.62 a barrel at late afternoon Singapore time in electronic trading on the New York Mercantile Exchange.
A huge cloud of volcanic ash has shut down air traffic in most of Europe for four days — stranding passengers and scuttling travel plans and freight services that could end up costing billions of dollars.
At the very least, traders say the volcano crisis will lower demand from airlines for jet fuel.
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World stocks fall on volcano, Goldman jitters
Monday on concerns over potential broader implications for banks of the US fraud case against investment bank Goldman Sachs and the impact on airlines from the Iceland volcano.
In Asia, markets fell after China announced measures to cool housing prices.
London’s FTSE 100 and France’s CAC-40 were both down 0.7 per cent, while Germany’s DAX was off 0.48 per cent by 12:45pm London time (7:45am EST). US stock futures were down slightly, extending their slide from Friday.
In the US the Dow Jones industrial average futures fell 54 points, or 0.54 per cent, to 10,930. Standard & Poor’s 500 index futures fell 6.60, or 0.6 per cent, to 1,183.70, while Nasdaq 100 index futures fell 10.00, or 0.5 per cent, to 1,999.75.
The drop built on
Friday’s 125-point plummet, which came after the SEC announced charges against Goldman.
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Airline losses from ash spiral over $1 billion
As airline losses from the volcanic ash cloud spiralled over $1 billion on Monday, airlines started demanding EU compensation and the aviation industry sharply criticised European governments for not using scientific measures to evaluate the ash and open up their airspace.
Shares of some European airlines fell as flight disruptions from the volcanic cloud moved into a fifth day, and the International Air Transport Association complained of ‘no leadership’ from government leaders — one of whom admitted to EU dissension about how to respond.
‘It’s embarrassing, and a European mess,’ IATA CEO Giovanni Bisignani told The Associated Press. ‘It took five days to organise a conference call with the ministers of transport and we are losing $200 million per day (and) 750,000 passengers are stranded all over. Does it make sense?’
European civil aviation authorities held a conference call Monday about what steps could be taken toward opening airspace, and transport ministers from all 27 EU member states were to hold another later in the day.
Dominique Bussereau, France’s transport minister, told reporters Monday that he had urged EU president Spain ever since Saturday to call the ministerial meeting immediately — but Madrid declined.
‘Naturally, it would have been better if had taken place Sunday or Saturday,’ Bussereau said.
British Airways said airlines have asked the EU for financial compensation for the closure of airspace, starting last Wednesday. With London among the first hubs shut down, the British carrier said it’s losing as much as 20 million pounds ($30 million) per day.
BA chief executive Willie Walsh said European airlines have asked the EU and national governments for financial compensation for the closure of airspace. He pointed to a precedent: compensation paid to airlines after the closure of US airspace following the September 11, 2001 terrorist attacks.
‘This is an unprecedented situation that is having a huge impact on customers and airlines alike,’ Walsh said. ‘We continue to offer as much support as we can to our customers, however, these are extraordinary circumstances that are beyond all airlines’ control.’
Environment minister Jean-Louis Borloo — the No. 2 in the French Cabinet — said a meeting was planned Tuesday of French airlines, travel agencies and the government to examine possible state aid to the industry.
‘This aid will evolve of course based on the severity of the crisis. For that, we need a European pre-accord that we have obtained — an accord in principle so this sector aid can be allocated,’ Borloo told France’s i-Tele.
The IATA, in a statement, called on governments to place ‘greater urgency and focus on how and when we can safely reopen Europe’s skies’ — such as through more in-depth study of the ash cloud.
‘We have to not just use — as the Europeans were doing — a theoretical model, let’s try to use figures and facts,’ Bisignani said.’ It means sending test planes at certain kinds of altitudes to check what was the situation with the ashes.’
While the association says ‘safety is our top priority,’ Bisignani said in the statement that its member airlines have run test flights with no problems and ‘they report missed opportunities to fly safely.’
Bisignani said that Europe — unlike the United States, for example — is ‘not well-equipped’ when it comes to planes that can test the air quality in the skies. He estimated that once flights in Europe do resume, it would take three to six days for traffic to return to normal.
France’s Borloo said disparate analyses needed to be brought together based on ‘real tests on real planes with real pilots,’ so some air ‘corridors’ could be reopened.
‘The issue today is not to reopen all European commercial airspace, the issue today is to increase the ability to reopen corridors to allow the general de-congestion of European traffic,’ he told reporters. ‘The desire of France — without taking risk — is to open corridors as much as possible and as quickly as possible.’
Pierre-Henri Gourgeon, the No. 2 executive at Air France-KLM, said his company is losing euro35 million a day and called for more test flights to see if routes are safe to fly. He said the French-Dutch carrier conducted five test flights on its own Sunday and planned another seven Monday.
Speaking to reporters Monday at Air France headquarters near Paris’ main airport, Gourgeon said aviation authorities had relied on ‘insufficient’ information when they imposed a near-blanket flight ban in some countries.
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East Asia could stabilise emissions by 2025: WB
East Asia could stabilise its greenhouse gas emissions by 2025 while maintaining economic growth by investing heavily in energy efficiency and low-carbon technologies, the World Bank said Monday.
Achieving this would require the region’s energy guzzlers to invest an extra $80 billion a year to make power, industry and transport sectors more efficient and develop renewable energy, the World Bank said.
Success also depends on the region finding the political will for big changes as well as transfers of financing and technologies from developed countries, the Washington-based lender said in a regional energy report.
‘Major investments in energy efficiency and a concerted switch to renewable sources of power... could simultaneously stabilise greenhouse gas emissions, increase energy security while improving local environments,’ the report said.
But the World Bank warned time was running out and urged policymakers in energy-hungry China, Indonesia, Malaysia, the Philippines, Thailand and Vietnam to act quickly.
‘While many East Asian countries are taking steps in these directions, accelerating the speed and scaling up the efforts are needed to get on to a sustainable energy path,’ it said.
‘The window of opportunity is closing fast, because delaying action would lock the region into a long-lasting high-carbon infrastructure.’
If countries act, regional carbon emissions could stabilise by 2025 and begin to decline, said the bank, which provides financial and technical aid to developing nations.
It said carbon emissions could be limited to 9.2 gigatonnes a year by 2030 — 37 per cent lower than the World Bank’s estimated level if governments stick to their current climate change policies.
Achieving the target depends largely on China, which accounts for 80 per cent of energy consumption and 85 per cent of regional carbon emissions, it said.
The world’s third-largest economy will need to reduce its carbon emissions as a percentage of economic growth by an even greater margin than currently planned, the bank said.
It called that a ‘daunting goal,’ given that China is still a developing country relying on energy-intensive, heavy-polluting industries.
It also noted that major policy and institutional reforms as well as big lifestyle changes would be needed throughout the region to achieve the goal.
‘Developing countries will need to avoid the carbon-intensive path and wasteful lifestyles followed by industrial countries in the past,’ the bank said.
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China steps up efforts to curb property prices
China has moved to further curb real estate speculation by telling banks they will be allowed to refuse additional mortgages to buyers who own two or more properties.
The move comes soon after the government last week raised the minimum down payment for second home purchases as authorities try to rein in the market with the economy growing at a blistering pace.
Under the new rules, announced at the weekend, banks can also refuse loans to people who cannot prove they have lived and paid taxes for at least one year in the city where they intend to buy, the State Council, or cabinet, said.
Last week the State Council raised the minimum down payment for second home purchases to 50 per cent and set a minimum 30 per cent deposit on first homes bigger than 90 square metres (970 square feet).
The latest moves highlight growing concern in China that the property market is overheating, after prices in major cities rose 11.7 per cent year-on-year last month, the fastest since the survey was widened to 70 cities in July 2005.
The State Council also renewed a pledge last week to rein in runaway prices by increasing the supply of land for construction, accelerating the building of affordable housing and cracking down on speculative activity.
But Royal Bank of Canada senior analyst Brian Jackson said the measures would not be as effective as higher interest rates.
‘I have very strong doubts that is going to be enough to get the results they want in terms of slowing down the property market and eventually they will have to use blunter instruments,’ Jackson told AFP.
China is trying various ways to prevent the growth of asset bubbles as the nation’s economy surges — it grew 11.9 per cent in the further three months of the year – and keep a lid on inflation.
Beijing has been clamping down on bank lending which has been blamed for fuelling speculative investment in the property sector.
Policymakers have raised bank reserve ratios twice this year — effectively limiting the amount banks can lend — and increased interest rates on benchmark three-month and one-year Treasury bills.
Analysts have forecast interest rate hikes as early as this month as well as a loosening of exchange rate policy, which has effectively pegged the yuan to the dollar since mid-2008.
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Toyota accepts $16.4m fine: US official
Japanese auto giant Toyota was expected to sign legal documents Monday, agreeing to pay the US government a record fine of nearly $16.4 million for concealing gas pedal defects.
‘By paying the full civil penalty Toyota is accepting responsibility for hiding the safety defect ... in violation of the law,’ a senior US government official told AFP late Sunday.
A Toyota spokesman declined to comment. But a well-informed source told AFP the automaker was expected to sign the necessary legal documents early Monday.
‘They’ve agreed to pay the maximum fine in record time, the most we can get,’ the source said. ‘They have 30 days to pay.’
Earlier this month, the US Department of Transportation said it was seeking ‘the maximum civil penalty of $16.375 million against Toyota’ after it failed to report its safety defects in a timely manner.
Toyota had failed to report ‘the dangerous ‘sticky pedal’ defect for at least four months, despite knowing of the potential risk to consumers,’ said the National Highway Traffic Safety Administration, the department’s watchdog.
It is the largest civil fine against an automaker ever sought by the NHTSA.
Toyota has recalled around 2.3 million cars in the United States for the pedal defect.
Worldwide it has recalled more than eight million cars over several problems, including the sticking accelerator pedal which caused cars to speed out of control.
Toyota had until Monday to agree to pay the fine, or contest it. If the two parties had not agreed a settlement, the matter could have gone to court.
The sudden acceleration problem allegedly caused by the gas pedal defects has been blamed for more than 50 deaths in the United States, and Toyota faces a slew of legal challenges in US courts.
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