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Crude oil prices climb 78_ in 20

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					                                                                               All Nippon mulls taking over                India’s exports rise as global                Fox grants brief extension to
                                                                               JAL’s overseas routes                       recovery boosts demand                        cable contract




                                                                               In the Pipeline                    26       Global Economy                       27       Bottom Line                         29

MARKET                                                                                                                                                                                                                     PATH

“Only buy something that you’d be perfectly                                                                                                                                                                                “A successful life is one that is lived through
happy to hold if the market shut down for 10                                                                                                                                                                               understanding and pursuing one’s own path, not
years.”                                                                                                                                                                                                                    chasing after the dreams of others.”
                                                          –WARREN BUFFETT                                                                                                                                                                                                –CHIN-NING CHU
                                                                                   Saturday, January 2, 2010




 INFORMATION
       K      I     O       S            K
                                                               Crude oil prices climb 78% in 2009
                                                               REUTERS


                                                               NEW YORK Oil finished the year above
                                                               $79 a barrel on Thursday, climbing a
                                                               whopping 78 percent in 2009 and
                                                                                                                                                                                                  OPEC output rose in Dec
                                                               notching the biggest annual gain in a                                                                                              BLOOMBERG                                 out to be incorrect.”
                                                               decade.                                                                                                                                                                         Crude oil futures have more than
                                                                  The market roared back from                                                                                                     NEW YORK      The Organisation of         doubled from a four-year low of
                                                               depressed levels seen at the end of                                                                                                Petroleum Exporting Countries             $32.40 a barrel touched in
                                                               2008 that came as the global econom-                                                                                               (OPEC) increased crude-oil produc-        December 2008, which caused
                                                               ic crisis sapped demand.                                                                                                           tion in December to the highest           OPEC to curb production. Prices
                                                                  US crude for February delivery set-                                                                                             level in a year as members took           rose 8 cents to settle at $79.36 a bar-
                                                               tled up 8 cents at $79.36 a barrel,                                                                                                advantage of rising prices, a             rel on Thursday the New York
                                                               compared with a close of $44.60 on                                                                                                 Bloomberg News survey showed.             Mercantile Exchange, a six-week
                                                               December 31, 2008. London Brent                                                                                                       Output averaged 28.965 million         closing high. Oil futures climbed 78
                                                               crude fell 10 cents on Thursday to                                                                                                 barrels a day this month, up 65,000       percent this year and tripled over
                                                               settle at $77.93.                                                                                                                  barrels from November, according          the past decade.
                                                                  This year’s rise in US oil futures is                                                                                           to the survey of oil companies, pro-         Nigeria’s output rose 100,000 bar-
                                                               the sharpest annual percentage gain                                                                                                ducers and analysts. The 11 coun-         rels a day to an average 2.005 mil-
                                                               since 1999, when output cuts by pro-                                                                                               tries with quotas, all except Iraq,       lion, the biggest increase of any
                                                               ducers helped revive prices from lows                                                                                              pumped 26.615 million barrels a           member and the highest level since
                                                               near $10 a barrel.                                                                                                                 day, 1.77 million above their target.     March 2008. The country exceeded
                                                                  Oil on Thursday was still almost                                                                                                All members exceeded their pro-           its target by 332,000 barrels a day. A
                                                               half the all-time high of $147.27 hit in                                                                                           duction goals.                            cease-fire and amnesty agreement
 CURRENCY                   BUY   QR      SELL   QR            July 2008.                                                                                                                            OPEC cut output quotas by 4.2          with the Movement for the
 US                        3.6315         3.6485                  After sliding to a five-year low        The oil market roared back from depressed levels seen at the end of 2008                million barrels to 24.845 million         Emancipation of the Niger Delta,
 Euro                      5.2091         5.3066               under $33 at the end of 2008, oil          that came as the global economic crisis sapped demand. (BLOOMBERG)                      barrels a day last year as fuel           the country’s main militant group,
 Pound Sterling            5.8398         5.9105               prices staged a steady climb to a high                                                                                             demand tumbled during the worst           allowed Nigeria to pump more oil
 Indian Rupee               0.077         0.0787               of $82 in October this year. The annu-     underway,” Mike Fitzpatrick, vice          as demand continues its gradual              global recession since World War II.      before an attack on Dec. 19.
 Pakistani Rupee               00         0.0435               al average 2009 price was $62, broad-      president at MF Global in New York,        recovery.                                    The group left the targets                   Kuwaiti output climbed 35,000
 Philippine Peso               00         0.0802               ly in line with analysts’ predictions at   said in a note. Oil’s rise of nearly 80       “We expect 2010 to be a year of           unchanged at a December 22 meet-          barrels to 2.25 million barrels a day.
 Sri Lankan Rupee              00        0.03248               the end of 2008 of $58.48.                 percent this year was part of a broad-     transition between the demand con-           ing in Luanda, Angola. Compliance         The country produced 28,000 bar-
 Bangladeshi Taka              00         0.0532                  Crude was supported on Thursday         based rally across commodities and         cerns of 2009 and the supply con-            was at about 60 percent, according        rels a day more than its quota,
                                                               by data from the US Energy                 equities as investment returned to         cerns of 2011, with in addition geopo-       to the survey.                            exceeding its target by the least of
 Nepalese Rupee                00         0.0492
                                                               Information Administration (EIA)           markets drained by the global eco-         litical developments having a height-           “It looks like OPEC production         any member.
 Japanese Yen             0.03905            0.04
                                                               that showed declines in crude oil          nomic recession.                           ened importance,” Barclays Capital           will continue to rise in coming              Only Iraq, which isn’t subject to a
 Kuwaiti Dinar             12.532         12.774               stockpiles last week, boosting expec-         “While it was nominally a very          said in a research note.                     months,” said Michael Lynch, presi-       quota, and Saudi Arabia, OPEC’s
 Saudi Riyal                0.957         0.9736               tations of demand recovery in the          strong year for commodities, it was a         US crude stockpiles fell by 1.5 mil-      dent of Strategic Energy &                largest producer, cut output.
 Omani Riyal                9.246           9.486              world’s largest energy user.               relative weak year for passive             lion barrels in the week to December         Economic Research in Winchester,             Iraq pumped 2.35 million barrels
 UAE Dirham                 0.977         0.9938                  “Momentum seems to run out near         investors,” said Olivier Jakob, oil ana-   25, just off an expected 2 million-bar-      Massachusetts. “OPEC is counting          a day, 50,000 barrels a day less than
 Bahraini Dinar             9.541           9.691              $80 as market participants ponder          lyst at Petromatrix.                       rel decline, while gasoline inventories      on increased demand. They will be         last month and the lowest level
                            Source: www.dohabank.com.qa        the conundrum of whether or not a             Next year, analysts expected oil        showed a surprise decline, data from         in trouble if their assumptions turn      since April.
                                                               sustainable recovery is actually           prices to consolidate this year’s gains    the EIA showed on Wednesday.




                                                                                                                               Rupee drops on dollar demand buzz
                                                                                                                               BLOOMBERG                                                                                                          are agreements in which assets
                                                                                                                                                                                                                                                  are bought and sold at current
                                                                                                                               MUMBAI    India’s rupee dropped                                                                                    prices for future delivery. Non-
                                                                                                                               on speculation rise in crude oil                                                                                   deliverable contracts are settled
                                                                                                                               prices will boost dollar demand                                                                                    in dollars rather than the local
                                                                                                                               from refiners.                                                                                                     currency.
                                                                                                                                  The rise in crude oil prices to a                                                                                 India’s exports rose for the first
                                                                                                                               six-week high in New York is                                                                                       time in 14 months as a recovery
                                                                                                                               forcing Indian refiners to pro-                                                                                    in the global economy boosted
                                                                                                                               cure more US currency in the                                                                                       year-end holiday demand for the
                                                                                                                               foreign-exchange market. The                                                                                       South Asian nation’s products.
                                                                                                                               price of the fuel jumped 78 per-                                                                                     Overseas            shipments
                                                                                                                               cent in 2009 as recovery from a                                                                                    increased 18.2 percent to $13.2
                                                                                                                               global recession boosted                                                                                           billion in November from a
                                                                                                                               demand. India, Asia’s third-           The rise in crude oil prices to a six-week high in New York is forc-        year earlier after sliding an
                                                                                                                               largest economy, gets more than        ing Indian refiners to procure more US currency in the foreign-              average 21 percent per month
                                                                                                                               70 percent of the crude it needs       exchange market. (BLOOMBERG)                                                since October 2008, according
                                                                                                                               from abroad.                                                                                                       to a trade ministry statement.
                                                                                                                                  “Oil prices are a concern for       Mumbai.                                 Offshore contracts indicate         Imports fell 2.6 percent to $22.8
                                                                                                                               the rupee since there is not             The rupee slipped 0.2 percent       bets the rupee will trade at 46.66    billion in November, resulting
                                                                                                                               enough dollar supply,” said            to 46.6175 per dollar at the 5 pm     to the dollar in a month, com-        in the trade deficit narrowing
                                                                                                                               Sudarshan Bhatt, chief currency        close in Mumbai, according to         pared with expectations for a         to $9.6 billion from $12.3 billion
                                                                                                                               trader at Corporation Bank in          data compiled by Bloomberg.           rate of 46.55 yesterday. Forwards     a year ago.




 US dollar loses lustre as reserve currency in a turbulent decade
 AFP                                                         The greenback also faced the same                                                                                                 percent in 2001.                            the head of the IMF whether the dol-
                                                          misfortune against other key curren-                                                                                                    The dollar also is less a benchmark      lar’s status was being threatened.
 WASHINGTON      The US dollar lost much                  cies.                                                                                                                                in official reserves than it was 10 years      Today, he talks about it himself. “I
 of its luster over the past decade as its                   While it was roughly stable against                                                                                               ago. On December 31, 1999, the              expect the dollar to remain the princi-
 status as a global reserve currency was                  the British pound, it has lost nearly 10                                                                                             International Monetary Fund (IMF)           pal reserve currency for some time,”
 challenged and its value against most                    percent against the yen and a hefty 35                                                                                               estimated the share of dollar-based         IMF managing director Dominique
 key currencies saw erosion.                              percent against the Swiss franc in the                                                                                               assets held by governments, excluding       Strauss-Kahn said in a speech in
    On the foreign exchange market,                       past decade. The trade-weighted US                                                                                                   the United States and China, was 74.9       November in Beijing.
 the euro was virtually at parity with                    dollar index, a measure of the value of                                                                                              percent. However, on September 30,             Ten years ago, the then-Federal
 the dollar on December 31, 1999, but a                   the US dollar relative to other world                                                                                                2009, it dipped to 70.2 percent.            Reserve chief Alan Greenspan raised
 decade later the greenback has fallen                    currencies, has lost 11 percent in the                                                                                                  The dropping dollar share was off-       in Congress the possibility of a mone-
 by 30 percent against the single                         past 10 years.                                                                                                                       set mostly by the euro, which some          tary union involving ‘dollarized’ coun-
 European currency.                                          One of the biggest falls, by 37 per-                                                                                              skeptics had doubted could rise to the      tries.
    The euro, launched on January 1,                      cent, was against the Canadian dollar,                                                                                               challenge as a common European cur-            The greenback was once common
 1999, ended in New York trading at                       the currency of the top US trading                                                                                                   rency at its launch.                        in everyday life in Argentina, which
 1.4323 dollars on Thursday, the last                     partner. Despite the bearish perform-                                                                                                   “The euro is already beginning to        was seriously considering ditching the
 trading day of the year.                                 ance, the dollar remains the bench-                                                                                                  challenge the US dollar’s status as the     peso, as well as in Bolivia, Russia and
    The dollar’s rapid fall against the                   mark of the exchange market.                                                                                                         world’s primary reserve currency and        the Philippines.
 euro is ironic as the US Federal                            According to recent figures from                                                                                                  it is an understatement to say that            Today, the South American trade
 Reserve had to come to the rescue of                     the Bank for International                                                                                                           over the past 10 years, the euro has        bloc Mercosur, led by Brazil and
 the faltering single European currency                   Settlements, which serves as a bank                                                                                                  come a long way,” said Kathy Lien,          Argentina, has abandoned the dollar
 in September 2000 as part of a coordi-                   for central banks, the share of trans-                                                                                               director of currency research at Global     in favor of local currencies for their
 nated market intervention by major                       actions involving the dollar fell           The trade-weighted US dollar index, a measure of the value of the US dollar              Forex Trading.                              trade, and Moscow sees the future of
 central banks.                                           slightly to 88 percent in 2007 from 91      relative to other world currencies, has lost 11 percent in the past 10 years.               In 1999, it was inconceivable to ask     the ruble as a reserve currency.
26          Saturday, January 2, 2010                                                                  In the Pipeline

All Nippon mulls taking Germany faces cut in Russian crude supply
over JAL’s overseas routes
                                                                                                                 REUTERS


                                                                                                                 MOSCOW      Russia and Belarus
                                                                                                                 have failed to reach agreement
                                                                                                                 on 2010 oil supplies, a Russian
REUTERS                              has been burdened by unprof-           have asked JAL to completely         government        source     told
                                     itable domestic and internation-       withdraw from overseas flights       Reuters on Thursday, in a move
TOKYO     Japanese airline All       al routes. JAL has already said it     and hand the business over to All    potentially exposing Germany
Nippon Airways is considering        will terminate flights on 30           Nippon, the Mainichi Shimbum         and Poland to cuts in Russian
taking over the international        routes, including 13 internation-      said on Thursday.                    crude supplies.
routes of struggling rival Japan     al, by June. All Nippon competes          But Transport Minister Seiji         Moscow and Minsk had a
Airlines Corp , the Yomiuri          with JAL on more than 30 of All        Maehara has been opposed to          similar dispute in January 2007,
Shimbun newspaper said on            Nippon’s 40 international routes,      having only one Japanese airline     when they could not agree on
Friday.                              the paper said.                        offer international service, the     prices of crude and transit fees,
   All Nippon is looking to             “We want to increase flights to     Mainichi said.                       and the row ultimately shut
increase its overseas flights by     Europe and the United States,”            JAL has applied for a bailout     down supplies for a few days.
targeting profitable routes to       the Yomiuri quoted an All              from a state-backed organization        The government source told
Europe and the United States         Nippon executive as saying.            of turnaround specialists, which     Reuters talks would be contin-
and has told Japan’s government         “We will need to consolidate        will decide whether to support       ued in early January and, as yet,
of its interest, the Yomiuri said,   routes in Asia where there is an       the airline this month.              oil supplies to Belarus would
citing unidentified sources. JAL,    overlap.” No one was available for        The Development Bank of           not be cut.
whose shares hit a record low        comment at either airline.             Japan has agreed to increase the        Russia supplies oil to Europe
this week on expectations that it    Offices and markets were closed        amount of its unsecured loans to     via Belarus along the Druzhba
was headed for bankruptcy            on Friday for the New Year holi-       the airline, Japanese media also     pipeline, one of the world’s
under a state restructuring plan,    day. Several cabinet ministers         reported on Thursday.                biggest by capacity and length.
                                                                                                                 Its name means ‘friendship’ in
                                                                                                                 Russian. Following are some
                                                                                                                 key facts about the Druzhba
                                                                                                                 pipeline:
                                                                                                                     Druzhba is one of the largest     Druzhba is one of the largest sections of Russian oil pipeline monopoly Transneft’s system. It starts in
                                                                                                                 sections of Russian oil pipeline      central Russia and connects West Siberian oil fields to major refineries in Europe.
                                                                                                                 monopoly Transneft’s system. It
                                                                                                                 starts in central Russia and con-     Germany received around             crude via the Baltic Sea port of       135,000 bpd, also almost fully
                                                                                                                 nects West Siberian oil fields to     350,000 bpd of crude via            Gdansk.                                meeting its demand.
                                                                                                                 major refineries in Europe.           Druzhba, or just under 15 per-         The southern leg of the                Belarus gets around 400,000
                                                                                                                    It has capacity of over 2 mil-     cent of its total consumption.      Druzhba pipeline supplies              bpd for its two refineries.
                                                                                                                 lion barrels per day (bpd), of        Refineries belonging to Total,      Slovakia, Hungary and the                 In 2008, Ukraine reexported
                                                                                                                 which some 1.2 million bpd            Shell and BP are among the          Czech Republic and has total           some 160,000 bpd of crude from
                                                                                                                 went directly to consumers in         biggest buyers of crude from        capacity of over 400,000 bpd,          its Black Sea terminal of
                                                                                                                 the European Union in 2008,           Druzhba.                            but is often underutilized. The        Odessa, which suspended reex-
                                                                                                                 while some 400,000 bpd stayed            Poland imports around            Czech Republic imports around          port operations earlier this year.
                                                                                                                 in Belarus.                           400,000 bpd of crude via            100,000 bpd via Druzhba, or half       Another Ukrainian Black Sea
                                                                                                                    The Druzhba pipeline splits        Druzhba for domestic refining,      its consumption; Slovakia buys         outlet, Yuzhny, also reexported
                                                                                                                 into two legs with the bigger         or more than three-quarters of      around 115,000 bpd from                some 150,000 bpd, while the
All Nippon is looking to increase its overseas flights by targeting profitable routes to Europe and the            one, the northern leg, going to       its consumption, and exported       Druzhba, covering its entire           Odessa refinery received some
United States.                                                                                                   Poland and Germany. In 2008,          another 90,000 bpd of Druzhba       needs, and Hungary imports             40,000 bpd in 2008.




Technip poised to benefit from oil price rebound
BLOOMBERG                            up 0.6 percent, in Paris on                                                                                          Technip has pinpointed the
                                     Thursday.                                                                                                         Middle East as an area of focus.
PARIS  Technip SA, set to be the        Technip, helping to build                                                                                      Arturo Grimaldi, senior vice
best performer on France’s           some of the world’s largest lique-                                                                                president for the region, said on
benchmark stock index this           fied natural gas projects in                                                                                      October 19 that the United
year, will probably benefit from     Qatar for Exxon Mobil Corp. and                                                                                   Arab Emirates is likely to award
an increase in oilfield-service      Royal Dutch Shell Plc, took                                                                                       $21 billion of energy contracts
tenders in 2010 as explorers         charges totaling 320 million                                                                                      by mid-2010 as it prepares for a
boost investment, analysts said.     euros ($461 million) in 2007                                                                                      recovery in global oil demand.
   “There’s going to be a pickup     because of cost overruns and                                                                                      Technip is also seeking con-
in exploration and production        delays. Chief Executive Officer                                                                                   tracts in Iraq and joining with
next year,” Guillaume Delaby, an     Thierry Pilenko vowed to select                                                                                   partners to win orders from
analyst at Societe Generale SA       contracts more carefully to                                                                                       Saudi Aramco, he said.
in Paris, said on Wednesday by       improve profitability.                                                                                               “We see a healthy $11 billion
telephone. Increased contract           Technip’s order backlog was                                                                                    opportunity set for onshore
wins, together with cost savings,    7.54 billion euros at the end of                                                                                  construction that we think
will allow Technip to weather        the third quarter, compared                                                                                       Technip will be bidding on in
price cuts on equipment such as      with 6.07 billion euros at the end                                                                                the Middle East,” Tao Ly, an ana-   The plant, located in Visaginas in eastern Lithuania, provided 70
flexible pipes, he said.             of June and 7.72 billion euros a                                                                                  lyst at Credit Suisse Group AG,     percent of the Baltic state’s electricity.
   The French oil-services           year earlier.                                                                                                     said in a November 26 report.
provider, which joined the coun-
try’s CAC 40 index on
September 21, has seen its stock
                                        The Paris-based company,
                                     like other oilfield-service
                                     providers around the world, suf-
                                                                                                                                                       Subsea pipe installation, an
                                                                                                                                                       area where the company plans
                                                                                                                                                       to expand, “should allow a rela-
                                                                                                                                                                                           Soviet-era Lithuanian
more than double this year.
Renault SA, the index’s second-
best performer, climbed 95 per-
cent, while France Telecom SA
                                     fered from a drop in investment
                                     by explorers this year after oil
                                     prices sank more than $100
                                     from their peak in July 2008.
                                                                            Technip’s order backlog was 7.54 billion euros at the end of the
                                                                            third quarter, compared with 6.07 billion euros at the end of June
                                                                            and 7.72 billion euros a year earlier.
                                                                                                                                                       tive degree of defensiveness
                                                                                                                                                       going into 2010.”
                                                                                                                                                          Technip, Europe’s second-
                                                                                                                                                       largest         oilfield-services
                                                                                                                                                                                           nuclear plant shuts
and gas supplier GDF Suez SA,
the biggest losers, slumped
more than 12 percent.
                                     Technip builds offshore facilities
                                     for the petroleum industry, as
                                     well as plants for producing and
                                                                            cent decline in net income next
                                                                            year, compared with a forecast-
                                                                                                                 from lower costs for equipment
                                                                                                                 and services, the French
                                                                                                                                                       provider, will probably end the
                                                                                                                                                       year in second place on the 17-
                                                                                                                                                       company Dow Jones Euro Stoxx
                                                                                                                                                                                           down under EU deal
   The gain in Technip stock is      processing fuels and chemicals.        ed 417.3 million euros in 2009,      Institute of Petroleum said last      Oil & Gas Index, behind Dragon      AFP                                    as an economic “tiger” after join-
linked to the rebound in oil         The company said last month it         according to a Bloomberg sur-        month. Global investment was          Oil Plc and ahead of Saipem                                                ing the EU, with rising wages,
prices, and to efforts to improve    expects lower sales and narrow-        vey of analysts. Sales are           $406 billion this year, a 16 per-     SpA, the region’s biggest oil-      VILNIUS    Lithuania on Thursday       easy credit and money sent
profitability even as orders         er profit margins in 2010 as oil       expected to fall 6 percent from      cent drop from 2008, the organ-       services company by market          shut down its Soviet-era nuclear       home by emigrants fuelling a
shrank, Antoine de Montille, an      producers wait for credit mar-         a forecast 6.49 billion euros this   ization said.                         value. Italy’s Saipem rose 104      plant under an EU deal in a move       boom. But it was hit hard as the
analyst at AlphaValue SAS, said      kets to ease and oil prices to rise    year.                                   “Our customers have started        percent in Milan trading this       set to drive up electricity prices     global crisis battered export mar-
by telephone. “The company           further before committing more            “The 2010 earnings consen-        showing real concerns about           year. Schlumberger Ltd., based      amid an economic crisis and            kets elsewhere in the EU, plus
had an abysmal track record          funds to exploration. Crude            sus on Technip is too low,”          missing their production tar-         in Houston and Paris, advanced      leave it counting on ex-master         Russia.
and this has now changed,” said      futures in New York, which have        SocGen’s Delaby said.                gets so it appears likely that        55 percent. Schlumberger CEO        Moscow for power.                         Its economy has shrunk by
de Montille, who recommends          rebounded 79 percent this year,           Spending on oil and gas           project awards will pick up in        Andrew Gould said on October           “At 11:00 pm (2100 GMT)             15.2 percent this year, the govern-
adding the shares and has a          were still 42 percent below year-      exploration and production           the second half of next year,         23 that oil- services capital       everything went offline. It all        ment estimates, and the nuclear
price estimate of 51.50 euros.       earlier levels in the third quarter.   may grow as much as 5 percent        assuming stability in oil prices,”    spending will rise “substantial-    went according to plan,” Viktor        shutdown could shave up to one
The stock closed at 49.40 euros,        Technip may report a 22 per-        next year as companies benefit       Pilenko said on November 13.          ly” in 2010.                        Sevaldin, director of the 26-year-     percentage point off gross
                                                                                                                                                                                           old plant, told AFP by telephone.      domestic product in 2010,
                                                                                                                                                                                              The plant, located in Visaginas     experts warn.
                                                                                                                                                                                           in eastern Lithuania, provided 70         Violeta Klyviene, a Danske


 UK home values increase for eighth month                                                                                                                                                  percent of the Baltic state’s elec-
                                                                                                                                                                                           tricity. It gradually went offline
                                                                                                                                                                                           from 8:00 pm (1800 GMT) on
                                                                                                                                                                                           Thursday, displaying its decreas-
                                                                                                                                                                                                                                  Bank analyst in Vilnius, told AFP
                                                                                                                                                                                                                                  individuals and businesses
                                                                                                                                                                                                                                  would “feel the aftershock” of the
                                                                                                                                                                                                                                  shutdown. She said the economy
 BLOOMBERG                                                                                                       spurring demand for homes,           measures to curb the UK’s budg-      ing output on its website.             could shrink by 4.5 percent in
                                                                                                                 while the British Bankers’           et deficit may damp house-price         It is similar to the one that       2010.
 LONDON    UK house prices rose                                                                                  Association said last week mort-     gains next year.                     exploded at Chernobyl in then-            Lithuania’s SEB Bankas in con-
 for an eighth month in                                                                                          gage lending rose to the highest        Bank of England policy maker      Soviet Ukraine in 1986, the            trast forecasts a modest recovery
 December as the lack of homes                                                                                   in two years in November. Bank       Kate Barker said on December         world’s worst nuclear accident.        with 1.0-percent growth.
 for sale and signs the economy                                                                                  of England policy maker Kate         16 that she is ‘surprised’ by the       Lithuania, which won inde-             Sevaldin came from Russia to
 is emerging from the worst                                                                                      Barker said in an interview this     pickup in UK house prices this       pendence from the Soviet bloc in       work at the plant on the eve of its
 recession on record pushed up                                                                                   month that economic growth           year and predicted the recovery      1991, agreed to shut the plant by      opening in 1983. “For years,
 prices, Nationwide Building                                                                                     probably resumed in the fourth       may stall in 2010. Hometrack         2010 in order to win admission to      nuclear power here was some-
 Society said.                                                                                                   quarter. Lower-than-projected        said this week that UK house         the EU in May 2004. One of the         thing normal and invisible. In the
    The average cost of a home                                                                                   job losses have also helped          prices will decline next year as     two reactors closed in December        coming months, we’re going to
 increased 0.4 percent from the                                                                                  boost prices, according to           rising unemployment and con-         2004. Vilnius later tried and failed   realise what we’ve lost,” he said.
 previous month to 162,103                                                                                       Nationwide. Data this month          cern about the government’s fis-     to convince Brussels to let it keep       Lithuania has long had plans
 pounds ($260,086), the mortgage                                                                                 showed UK unemployment               cal squeeze limit demand.            the plant open until a replace-        to plug the gap, however.
 lender said in a statement on       Record-low interest rates and signs the recession is abating are            unexpectedly declined for the           “There is still a significant     ment is ready — something not             “I can offer assurances that
 Thursday. Prices rose 5.9 percent   spurring demand for homes.                                                  first time since February 2008.      amount of fog clouding the out-      expected until 2018-2020.              after the shutdown, Lithuania
 from a year earlier. Home values                                                                                   The Royal Institution of          look for house prices,”                 Power prices in this country of     won’t lack electricity,” said Prime
 are 12.2 percent lower than at       house prices,” Martin Gahbauer,       have helped to boost consumer        Chartered Surveyors said this        Gahbauer said. “This year’s          3.3 million people are to rise         Minister Andrius Kubilius, who
 their peak in October 2007.          Nationwide’s chief economist,         confidence and tempt previous-       month that its house-price           recovery has to some extent          Friday by 30 percent for house-        was elected in October 2008 and
    “The restriction in supply        said in the statement. “In addi-      ly hesitant buyers back into the     gauge rose to a three-year high      been driven by transitory fac-       holds and 20 percent for compa-        opposed last-ditch attempts to
 meant that even a relatively         tion, the stabilization of the        market.”                             in November.                         tors, and there are reasons to       nies, marking a new blow amid          delay the shutdown.
 modest pick-up in demand was         banking system and emerging              Record-low interest rates and        Rising unemployment and           believe that it will lose momen-     one of the world’s deepest eco-           Lithuania has turned to
 able to put upward pressure on       signs of economic recovery            signs the recession is abating are   the prospect of government           tum over the coming year.”           nomic crises.                          mothballed gas and oil-fired
                                                                                                                                                                                              Lithuania earned a reputation       power stations.
                                                                                                  Global Economy                                                                                                        Saturday, January 2, 2010         27


India’s exports rise as global recovery boosts demand
BLOOMBERG                            Overseas sales of Indian gems
                                     and jewelry jumped 54.8 percent
NEW DELHI     India’s exports rose   to $21.4 billion in November
for the first time in 14 months as   compared with $13.8 billion in
recovery in the global economy       the same month a year ago,
boosted year-end holiday             according to the Gem &
demand for the South Asian           Jewellery Export Promotion
nation’s products.                   Council. Vehicle exports rose 25
   Overseas             shipments    percent in November from a
increased 18.2 percent to $13.2      year earlier, the Society of Indian
billion in November from a year      Automobile Manufacturers said
earlier after sliding an average     on December 8.
21 percent per month since              November’s increase in
October 2008, according to data      exports shouldn’t be seen as the
provided by the trade ministry.      beginning of a positive trend, as
Imports fell 2.6 percent to $22.8    shipments rose mainly due to a
billion.                             low base in the same month last
   Record-low interest rates and     year, Bhanumurthy said. The
more than $2 trillion in govern-     difficulties for exporters and the
ment stimulus worldwide are          Indian economy are not yet over,
reviving demand for clothes          he said.
made by Gokaldas Exports and            “The surge in inflation will
Hyundai Motor cars. South            result in increasing input costs
Korea’s exports rose 33.7 per-       for exporters, forcing them to
cent in December, the fastest        raise prices and making it diffi-
pace in 17 months, as Asian          cult for them to remain compet-
economies from China to              itive in overseas markets,”
Singapore recover from the           Bhanumurthy said.
worst global recession since the        India’s benchmark wholesale-
1930s.                               price index climbed 4.78 percent
   “We are seeing a rebound in       in November from a year earlier,
overseas sales mainly due to         more than tripling from a 1.34
improved conditions in the US        percent gain in October, the gov-
and Europe and festival demand       ernment said on December 14.
ahead of Christmas,” said NR         A stronger rupee is also affect-
Bhanumurthy, an economist at         ing exporters’ earnings, accord-
the National Institute of Public     ing to the Federation of Indian
Finance and Policy in New            Export Organisations.
Delhi.                                  The Indian currency strength-
   A return to export growth         ened 4.8 percent in 2009 to           India’s benchmark wholesale price index climbed 4.78 percent in November from a year earlier, more than tripling from a 1.34 percent gain in October.
may boost production at com-         46.5275 per dollar at the 5 pm
panies in India and bolster the      close in Mumbai on Thursday,          funds raised their holdings of       mean there is no need to go          after a yearlong contraction and      increase overseas sales by devel-    dependence on the US and
revival in Asia’s third-biggest      according to data compiled by         the nation’s stocks to a record as   hoopla over these numbers,”          France, Germany and Japan             oping trade agreements with          Europe, which account for
economy, which expanded 7.9          Bloomberg. That was the third-        the benchmark Sensitive Index        Trade Secretary Rahul Khullar        have exited recession.                other countries. The South           about 40 percent of the nation’s
percent in the three months to       best performance among Asian          rallied the most in 18 years.        said on December 15.                    The US economy, India’s sec-       Asian nation in August signed a      exports. India in August also
September 30 from a year earli-      currencies after Indonesia’s          Indian stock market is closed        Shipments dropped almost 20          ond-biggest export market,            free-trade accord with South         announced tax refunds for
er, the quickest pace in six quar-   rupiah and the South Korean           today due to a holiday.              percent in November 2008 from        expanded 2.2 percent in the July-     Korea and the 10-member              exporters to explore new mar-
ters. Some sectors have started      won.                                    “The low-base effect on            a year earlier. The US returned      September quarter.                    Association of Southeast Asian       kets in Africa and Latin
showing signs of improvement.           The rupee gained as foreign        November’s export growth             to growth in the third quarter          India is boosting its efforts to   Nations as it attempts to reduce     America.




Manufacturing at 20-month high in China Bangladesh claims it
                                        is out of recession
BLOOMBERG                                                                                                                                            production costs for companies
                                                                                                                                                     are increasing.”                      IANS
BEIJING  China’s manufacturing
expanded at the fastest pace in
20 months in December,
                                                                                                                                                        China and Asia are leading
                                                                                                                                                     the world recovery, helping to
                                                                                                                                                     boost global confidence, which
                                                                                                                                                                                           DHAKA Bangladesh says it is
                                                                                                                                                                                           ìalmost out of the impact of the
                                                                                                                                                                                                                                 B  angladesh has
                                                                                                                                                                                                                                 been importing
cementing the recovery in the                                                                                                                        held near a record high in            global economic recessionî
world’s third-biggest economy.                                                                                                                       December, according to a              with every economic index
                                                                                                                                                                                                                                 electricity from India
   The Purchasing Managers’                                                                                                                          Bloomberg survey of users of six      looking positive.                     for which an
Index climbed to a seasonally                                                                                                                        continents, first conducted two          “In the outgoing year, our         agreement is likely to
adjusted 56.6, the Federation of                                                                                                                     years ago. China may overtake         exports, imports of capital           be signed later this
Logistics and Purchasing said                                                                                                                        Japan as the world’s second-          machineries were on the rise,         month when PM
today in an e-mailed statement                                                                                                                       biggest economy this year.            foreign exchange reserves and         Sheikh Hasina visits
in Beijing. That compares with                                                                                                                          Profits are climbing as the        remittance were also satisfac-        New Delhi.
55.2 in November and the medi-                                                                                                                       economy gathers pace. Beijing         tory. In fact, we are almost out
an 55.4 estimate in a Bloomberg                                                                                                                      Automotive Industry Holding,          of the impact of global eco-         Sheikh Hasina visits New Delhi.
News survey of seven econo-                                                                                                                          the company which is buying           nomic recession,” Finance              Muhith said Bangladesh
mists.                                                                                                                                               technology from General               Minister AMA Muhith said.            needs to expand the public
   The boost to Chinese manu-                                                                                                                        Motors’s Saab unit, said on              Maintaining that each eco-        expenditure and also mobilise
facturing from subsidies for                                                                                                                         December 23 that 11-month net         nomic index of the country is        resources, New Age newspaper
home- appliance purchases and                                                                                                                        income more than tripled.             now positive, Muhith, however,       said.
tax rebates for exporters will                                                                                                                       China Gas Holdings’s profit in        admitted that there were some          He also spoke of the need for
continue this year as the gov-                                                                                                                       the six months ended                  problems related to both             good governance as a chal-
ernment extends policies to                                                                                                                          September jumped nearly six-          domestic and foreign invest-         lenge if the country is to
counter the financial crisis.        The boost to Chinese manufacturing from subsidies for home- appliance purchases and tax rebates for             fold. Premier Wen Jiabao said         ment.                                emerge as an intermediate
China’s growth will accelerate       exporters will continue this year as the government extends policies to counter the financial crisis.            on December 27 that China                “There is no reason to be         economy.
to 8.8 percent in 2010, four                                                                                                                         won’t make the mistake of end-        complacent,” he was quoted as          The Daily Star, in a look-back
times faster than the US, as the     said before Friday’s data.            2008, when recessions in the US,       “Attention should be focused       ing stimulus policies too soon,       saying by the United News of         at 2009, credited the economic
world economy expands 2.4            “Exports may return to growth         Europe and Japan sent export         on the drop in the export- order     even as he signaled that the gov-     Bangladesh (UNB) news                recovery to the performance of
percent, the United Nations          in December, aiding manufac-          orders plunging. A reading           index, which shows there             ernment may cool new lending          agency.                              the farmers, workers and the
forecast last month.                 turing growth.”                       above 50 indicates an expan-         shouldn’t be premature opti-         that reached an unprecedented            He specified power and ener-      migrant workers abroad who
   “Manufacturing will stay at a       Industrial production grew in       sion.                                mism about an improvement in         $1.3 trillion in the first 11         gy as the two sectors that need-     send remittances back home.
high level as industrial produc-     November at the fastest pace             A measure of new export           international markets,” Zhang        months of last year. Wen also         ed to be expanded.                   ìKudos goes to farmers, work-
tion quickens and companies          since March 2008, exports             orders fell to 52.6 in December      Liqun, a researcher at the State     said China will ‘absolutely not          Bangladesh       has    been      ers and migrant labourers this
receive more orders for new-         dropped the least in 13 months        from 53.6 in November and a          Council Development and              yield’ to pressure from foreign       importing electricity from           year.       Without        them,
year holiday sales,” Lu              and imports surged.                   gauge of purchasing prices           Research Centre, said in the         countries for currency gains as       India for which an agreement         Bangladesh could face differ-
Zhengwei, an economist at              Friday’s figure compares with       increased to 66.7 from 63.4,         statement. “The rise in the pur-     the nation holds the yuan at          is likely to be signed later this    ent music in the year that
Industrial Bank in Shanghai,         a record-low 38.8 in November         according to the statement.          chasing price index shows that       about 6.83 per dollar.                month when Prime Minister            rolled by.”




Singapore economy recovering after 2009 contraction
BLOOMBERG                            remain and no one expects an          ous three months, after climb-       Bank’s Office for Regional
                                     exuberant boom.”                      ing 14.2 percent from July to        Economic Integration said on
SINGAPORE    Singapore’s econo-         Singapore joined other Asian       September, according to the          December 15. The US, Asia’s
my is improving after a ‘volatile’   nations in emerging from a            median estimate of eight econo-      largest export market, needs to
year that saw it shrink for the      global economic slump last year       mists surveyed by Bloomberg.         prepare for a second stimulus
first time since 2001, Prime         after the region’s governments        The trade ministry will release      package as there’s a ‘significant’
Minister Lee Hsien Loong said.       unveiled about $1 trillion in         the economic data at 8 am on         chance that growth will slow in
   Gross domestic product fell       stimulus measures to spur             January 4.                           the second half of 2010, Nobel
2.1 percent in 2009, Lee, 57, said   growth. Still, a ‘sluggish recov-        Lee’s estimates on Thursday       Prize-winning         economist
in his New Year message on           ery’ in overseas demand for           suggest the Southeast Asian          Joseph Stiglitz said on
Thursday. That’s in line with the    goods made by companies such          economy may have shrunk as           December 21.
government estimate for a con-       as Stats Chippac may moderate         much as 5 percent in the fourth         “The global economy will
traction of 2 percent to 2.5 per-    growth prospects in the coming        quarter from the previous three      experience ‘modest’ growth this
cent. The trade ministry fore-       months, the government said in        months, said Song Seng-Wun,          year even as the worst is behind
casts the economy will expand 3      November.                             an economist at CIMB-GK              us,” Lee said in a December 30
percent to 5 percent in 2010, an        The economy grew 3.5 per-          Securities in Singapore.             commentary written for
estimate reiterated by Lee.          cent in the fourth quarter from          “The likely contraction in the    Bloomberg News. Still, Asia is
   “Our economy is growing           a year earlier, Lee said. That        fourth quarter after two strong      expected to resume its ‘rapid’
again, and has recovered much        compares with the 3.8 percent         quarters highlights the vulnera-     growth, he said on Thursday.
of the ground since the reces-       median forecast of nine econo-        bility of the recovery,” Song said      Singapore’s economy shrank        Singapore’s economy grew 3.5 percent in the fourth quarter from a year earlier.
sion began” in 2008, Lee said.       mists surveyed by Bloomberg           after Lee’s message on               in the 12 months through
“Worldwide, economies have           News.                                 Thursday.                            March as the worst global reces-     sumer spending.                       ing last year in an effort to min-   measures to help companies get
stabilised. The US, Japan and           GDP probably contracted an            Asia’s rebound could falter as    sion since World War II curbed         The government cut corpo-           imise job losses and help busi-      financing, after deciding in
Europe are starting to grow          annualised 2.1 percent in the         the effect of stimulus measures      exports, prompted tourists to        rate taxes and tapped its             nesses and workers. It said this     October to prolong a wage-sub-
again, although problems             fourth quarter from the previ-        fade, the Asian Development          stay away and damped con-            reserves to fund record spend-        week it will extend by a year        sidy programme.
28          Saturday, January 2, 2010                                                                   Market Matrix

European stocks post 3rd weekly straight advance in a decade
BLOOMBERG                                                                                                                                                                                   Renault SA, France’s second-             This past week, the measure
                                                                                                                                                                                            biggest, each surged 95 per-          capped its longest stretch of
PARIS  European stocks posted                                                                                                                                                               cent. French car sales                weekly gains since August as
their third straight weekly                                                                                                                                                                 increased for a seventh consec-       China raised its 2008 growth
advance, with the Dow Jones                                                                                                                                                                 utive month in November as            estimate to 9.6 percent from 9
Stoxx 600 Index completing its                                                                                                                                                              government rebates for scrap-         percent and said quarterly fig-
biggest annual increase in a                                                                                                                                                                ping old vehicles when new            ures for 2009 will also increase.
decade as the global economy                                                                                                                                                                ones are purchased, combined             An index of home prices in 20
recovered from its worst reces-                                                                                                                                                             with environmental bonus-             US cities rose in October for a
sion since World War II.                                                                                                                                                                    and-penalty payments, spurred         fifth consecutive month, put-
  Basic-resources companies                                                                                                                                                                 demand for more fuel-efficient        ting the housing market and
and banks, the worst-perform-                                                                                                                                                               cars and slowed sales of luxury       economy farther down the path
ing industry groups in 2008, led                                                                                                                                                            vehicles.                             to recovery, according to a
gains in the measure, surging                                                                                                                                                                  Germany’s DAX rallied 24           report on December 29. A sepa-
100 percent and 46 percent in                                                                                                                                                               percent,       with     Infineon      rate report on the same day
2009, respectively. Kazakhmys                                                                                                                                                               Technologies AG surging 352           from the New York- based
Plc, Kazakhstan’s biggest cop-                                                                                                                                                              percent. Europe’s second-             Conference Board showed con-
per producer, soared 475 per-                                                                                                                                                               biggest semiconductor maker           fidence among US consumers
cent, as the price of the metal                                                                                                                                                             entered the benchmark gauge           rose in December for a second
more than doubled. Natixis SA,                                                                                                                                                              after returning to profit follow-     month as pessimism over the
the investment-banking unit of                                                                                                                                                              ing 10 consecutive quarters of        outlook for jobs diminished.
France’s second-largest lender                                                                                                                                                              losses.                                  Companies in the US
by branches, climbed 184 per-                                                                                                                                                                  The Stoxx 600 posted its           expanded in December at the
cent.                                                                                                                                                                                       biggest annual retreat on             fastest pace in almost four
  The Stoxx 600 rose 28 per-                                                                                                                                                                record in 2008, falling 46 per-       years, according to The
cent to close the year at 253.16,                                                                                                                                                           cent, as credit losses and write-     Institute       for       Supply
having posted a 0.5 percent                                                                                                                                                                 downs at the world’s largest          Management-Chicago Inc. on
gain in the holiday-shortened                                                                                                                                                               financial firms surpassed $1          December 30.
week as China raised its eco-                                                                                                                                                               trillion and the U.S., Europe            Antofagasta Plc, the copper
nomic growth forecast. The                                                                                                                                                                  and Japan entered simultane-          producer controlled by Chile’s
measure rebounded 60 percent                                                                                                                                                                ous recessions. Basic-resources       Luksic family, and Lonmin Plc,
from the 2009 low in March                                                                                                                                                                  shares and banks in the meas-         the world’s third-largest plat-
amid record-low interest rates                                                                                                                                                              ure each lost 64 percent as           inum producer, led basic-
in the US and Europe and as                                                                                                                                                                 investors sold off shares linked      resources shares higher as met-
governments committed about                                                                                                                                                                 to economic growth and those          als rose. They gained 6 and 4.2
$12 trillion worldwide to revive                                                                                                                                                            most hurt by the credit crisis.       percent, respectively, this past
credit markets and stimulate          The Stoxx 600 posted its biggest annual retreat on record in 2008, falling 46 percent, as credit losses and writedowns at the world’s                    Kazakhmys jumped 475 per-          week.
growth. The S&P 500 gained 23         largest financial firms surpassed $1 trillion and the U.S., Europe and Japan entered simultaneous recessions.                                           cent in 2009, while Boliden AB,          Q-Cells SE surged 14 percent,
percent in 2009.                                                                                                                                                                            Europe’s second-biggest zinc          the best performer in the Stoxx
  “There was the conviction           trimming its drop over the past       ing the euro, sank 45 percent in     field-services      companies        among 23 developed markets            producer, soared 428 percent          600 this past week, after Han-
that governments weren’t              decade to 33 percent. Its best        2009 for the first annual drop       including Seadrill Ltd. and          that have recouped all of their       as the best-performing mining         delsblatt newspaper cited the
going to abandon the econo-           month last year was April, with       since 2004.                          Petroleum Geo-Services ASA,          post-Lehman losses.                   shares in the Stoxx 600.              German solar-cell maker’s chief
my,” said Emmanuel Soupre,            the gauge soaring 13 percent as          National benchmark indexes        which both more than dou-              “We erased the Lehman peri-            Copper more than doubled           executive officer as saying the
who helps manage about $15.6          US banks including Citigroup          rose in all of the 18 western        bled.                                od and returned to the level          in 2009 with the help of record       company expects to be prof-
billion at Neuflize OBC in Paris.     Inc. and Goldman Sachs Group          European markets except                 The U.K.’s FTSE 100 climbed       prior to the collapse,” said          first-half imports into China,        itable in 2010.
“What lifted the market was           Inc. reported earnings that           Iceland in 2009. The north           22 percent, and on Dec. 29           Guillaume            Duchesne,        the world’s largest consumer.            Basilea Pharmaceutica Ltd.
the idea that we no longer            exceeded analysts’ estimates.         Atlantic island is the western       became the first equity market       Luxembourg- based equity              Prices are up almost fourfold         tumbled 17 percent, the biggest
spoke of a depression, but only       The measure climbed 5.9 per-          nation hardest hit by the global     among the biggest developed          strategist at Fortis Private          from the end of 1999 in London.       weekly retreat since February.
a recession. When we saw              cent in December. The S&P fell        credit crisis, and needed to         economies to recover its loss        Banking, which oversees about         Natixis surged 184 percent for        The US        Food and Drug
depressive forces countered by        24 percent in the last decade.        turn to the International            following Lehman Brothers            $117 billion. “Investors played       the best performance among            Administration rejected its
government and central bank              The VStoxx Index, which            Monetary Fund for a $2.1 bil-        Holdings Inc.’s bankruptcy in        the stabilisation of the econo-       bank stocks. The French lender        experimental        ceftobiprole
support, that helped the mar-         gauges the cost of using              lion loan to avert a default.        September 2008. The UK               my.” France’s CAC 40 advanced         this month said it will be prof-      antibiotic because clinical trial
ket to take off.”                     options to protect against               Norway’s OBX was the best         joined Hong Kong, Norway,            22 percent in 2009, as PSA            itable in the fourth quarter.         data were “unreliable.” The FDA
  The Stoxx 600 reached a 15-         declines in the Euro Stoxx 50, a      performer, gaining 70 percent        Portugal, Singapore, Spain and       Peugeot Citroen, Europe’s sec-           All 19 industry groups in the      requested two new studies on
month high on December 29,            measure for the countries shar-       as higher oil prices lifted oil-     Sweden as the only nations           ond-largest carmaker, and             Stoxx 600 rose in 2009.               the drug, Basilea said.


China likely
to grow                               Commodity markets rally in 2009 on recovery signs
9.5% in 2010                          AFP                                   certainly benefited raw materi-
                                                                            als linked to the expanding
                                                                                                                 prices plunging to around 33
                                                                                                                 dollars towards the end of 2008.
                                                                                                                                                      nation.
                                                                                                                                                         Prices were also supported
                                                                                                                                                                                               London’s Brent North Sea
                                                                                                                                                                                            crude for February fell 10 cents
                                                                                                                                                                                                                                  On the London Platinum and
                                                                                                                                                                                                                                  Palladium Market, platinum
AFP                                   LONDON    Commodity prices ral-       infrastructure and industrial           “So much then for 2009, a         this week by cold winter weath-       to settle at 77.93 dollars.           increased to 1,466 dollars an
                                      lied in 2009 on keen demand           growth.                              year that the oil market spent       er in the northern hemisphere             Gold prices sparkled this         ounce on Thursday from 1,456
BEIJING     China is expected to      and signs of global economic             “Demand ( from leading            mainly in a recovery mode,” said     — which increases demand for          year, scoring a record peak of        dollars.
grow by about 9.5 percent in          recovery, with oil soaring and        industrialised economies) has        Barclays Capital analyst Paul        heating fuel — and geopolitical       1,226.56 dollars per ounce at the        Palladium rose to 402 dollars
2010, state media quoted a gov-       gold striking record levels, while    yet to show significant and sus-     Horsnell.                            concerns over key crude pro-          start of December, before tailing     an ounce from 377 dollars.
ernment think tank as saying on       copper and sugar surged.              tained signs of an economy              “It produced a (New York oil)     ducer Iran.                           off as many traders cashed in               Copper soared this week,
Friday, exceeding forecasts made      Many raw materials also rose          recovery. However, end-of-year       average of about 62 dollars per         Last week, the Organisation        gains.                                striking a new multi-month peak,
by outside experts for the new        this week in thin trade ahead of      data, especially from the United     barrel, encompassing a low of        of      Petroleum      Exporting         The glamourous metal has           taking its annual gain to more
year.                                 the New Year holiday weekend,         States, was fairly encouraging.”     33 dollars and a high of 82 dol-     Countries held its crude output       smashed records on the back of        than 140 percent as traders fret-
   The world’s third-largest econ-    with investors winding down              Back in 2008, crude oil and       lars, with prices finishing the      quotas unchanged at its meet-         inflationary fears and increas-       ted over possible strikes in key
omy will be boosted by double-        for celebrations to usher in          base metals had forged historic      year close to the highs after a      ing in Angola, warning of linger-     ing moves by central banks to         producer Chile.
digit growth in real estate invest-   2010.                                 peaks on supply woes, before         steady 10-month climb.”              ing weakness in the world econ-       diversify assets away from the           Most other base metals also
ment and mild inflation, the             “2009 has been a rollercoaster     tumbling as the global financial        However, prices still remain      omy. The OPEC meeting capped          dollar, which weakened against        leapt higher on better-than-
State Council’s Development           ride for most commodity mar-          crisis and recession sparked         far below the record highs           a year of recovery for oil prices,    the European single currency.         expected US data and thin mar-
Research Centre said in a report      kets, with copper, sugar and          demand worries.                      above 147 dollars that were          which have more than doubled             The weak level of the green-       ket conditions.
published in the China Economic       New York crude performing                Crude oil leapt this year by      struck in July 2008 on fears of      since the cartel set strict quota     back made dollar-priced com-             Copper hit 7,423.75 dollars per
Times.                                especially well,” said VTB            around 80 percent as traders         supply disruptions.                  cuts in the depths of the eco-        modities cheaper for buyers           tonne on Thursday, reaching the
   “In 2010, the external environ-    Capital commodities analyst           were heartened by evidence              New York crude rose on            nomic crisis a year ago.              using stronger currencies — which     highest level since September
ment will remain rather grim          Andrey Kryuchenkov.                   that the battered global econo-      Thursday to briefly hit 80 dol-         In January, the cartel             tends to stimulate demand.            2008. “A much higher-than-
but it will not deteriorate fur-         “Refined copper and raw            my was on the mend, with the         lars per barrel in light pre-holi-   enforced total OPEC cuts of 4.2       However, by Thursday on the           expected Chicago PMI figure out
ther,” Zhang Liqun, a macro-          sugar were certainly the out-         eurozone, Japan and the United       day trade. The market had            million barrels a day.                London Bullion Market, gold stood     of the United States, continued
economist at the centre, said in      standing gainers as both more         States escaping a fierce reces-      climbed on Wednesday after              New York’s main futures con-       at 1,104 dollars an ounce, down       uncertainty about strike threats
the report.                           than doubled from lows at the         sion.                                news of a drop in US petroleum       tract, light sweet crude for deliv-   from 1,104.50 dollars the previous    in Chile, and generally thin mar-
   Zhang added that exports — a       start of the year.”                      The worldwide economic            reserves, which suggested            ery in February, crept eight          on Thursday.                          ket conditions, all contributed to
key driver of economic growth            He added: “China’s unprece-        downturn had slammed                 stronger demand in the world’s       cents higher to close at 79.36           Silver edged down to 16.99 dol-    the stronger tone,” said MF
— would start to grow again in        dented financial stimulus had         demand for energy and sent oil       biggest      energy-consuming        dollars a barrel.                     lars an ounce from 17.32 dollars.     Global analyst Edward Meir.
the coming year.
   The think tank’s 2010 eco-
nomic growth forecast is well
above Beijing’s oft-stated target
of eight percent — seen as cru-
                                      BSE snaps 3-day losing streak, Sensex up 91 pts Goldman Sachs helps
cial for job creation and ensuring
social stability — and is higher
than estimates for 2009.
                                      PTI                                             YRC avert bankruptcy
                                                                            handful of stocks like metal
                                                                            heavy weight Tata Steel and
   For 2010, the Asian                MUMBAI      The Bombay Stock          Hindalco, realty leader DLF and
Development Bank has put its          Exchange benchmark index              telco Bharti Airtel, which all                                                                                  BLOOMBERG                             has posted $1.7 billion in losses
economic growth forecast for          Sensex on Friday recovered            gained close to 4 percent each.                                                                                                                       in the past five quarters, needed
China at 8.9 percent, while the       from its six-week lows, gaining         Similarly, the wide-based                                                                                     NEW   YORK     Goldman Sachs          to complete the exchange by
International Monetary Fund           91 points on firm global cues         National Stock Exchange index                                                                                   Group Inc. helped YRC                 December 31 to avoid a bank
predicted growth of nine per-         and on emergence of brisk buy-        Nifty 50 also rose by 33.25                                                                                     Worldwide Inc. complete a debt        payment that would have left
cent. China’s economy grew by         ing by funds in key sectors like      points to close at 4,985.85 after                                                                               swap to avert bankruptcy after        the trucker in an “unsustain-
8.9 percent in the third quarter      metals and PSUs among others.         touching an intra-day high of                                                                                   the Teamsters union said the          able” position, the Overland
of 2009 — the fastest pace in a          The 30-share bellwether            4,997.30.                                                                                                       bank was trying to profit from a      Park, Kansas-based company
year — after expanding by 7.9         Sensex initially touched a high         However, marketmen are not                                                                                    failure of the largest US trucker     said in a regulatory filing two
percent in the second quarter         of 16,738.12 but pared some of        very enthused about this and                                                                                    by sales.                             weeks ago.
and 6.1 percent in the first, the     those gains to end at 16,692          are cautious saying this                                                                                           A group consisting of                 International Brotherhood of
slowest pace in more than a           points, posting a net rise of         renewed interest is temporary                                                                                   Goldman Sachs, Deutsche Bank          Teamsters President James
decade.                               90.80 points or 0.55 per cent         and driven by the massive fall in                                                                               AG, Aristeia Capital LLC,             Hoffa said in letters last month
   Zhang said real estate invest-     from its previous close of            the previous days, especially on                                                                                Silverback Asset Management           to regulators and lawmakers
ment was expected to grow by          16,601.20. The Sensex had shed        the metals counters.                                                                                            and a Smith Management LLC            that Goldman Sachs and
30 to 40 percent in 2010 and          312 points or 1.84 per cent in          Ashika       Stock      Brokers                                                                               unit, “got us over the goal line by   Deutsche Bank were among
become the “main source driv-         last three sessions alone.            research head Paras Bothra                                                                                      going into the market, buying         banks that “have a history of
ing investment growth”.                  The market snapped its             said, “Today’s rally was purely a                                                                               bonds and tendering them,”            making markets in these types
   China last month vowed to          three-day losing streak on            reflection of the global markets                                                                                YRC Chief Executive Officer Bill      of derivative financial products.”
tighten supervision of the real       renewed demand in key sectors         which were holding up.                                                                                          Zollars said on Thursday.                Goldman Sachs spokesman
estate market to curb “overly         like metals, PSUs led by banks,         “Yesterday the metal stocks                                                                                      YRC extended the deadline          Michael DuVally said on
fast” price rises that have raised    realty, and telecom counters on       were hammered down quite a                                                                                      for the bond exchange six times       December 17 that the bank was
fears of a property market bub-       the back of news of higher            lot. This brought in a kind of                                                                                  in December as it sought to           “actively exploring ways to help”
ble. The country’s consumer           advance tax payments by lead-         rebound in the sector today.                                                                                    overcome resistance from              YRC. Bondholders with 70 per-
price index, a key measure of         ing corporates,helping the mar-         The rally is basically a one-                                                                                 bondholders owning deriva-            cent of YRC’s $150 million of 8.5
inflation, is estimated to remain     kets to rebound.                      day kind of an activity, devoid of   The market snapped its three-day losing streak on renewed                  tives that would pay out if the       percent notes due in April
below three percent, Zhang said.         The rally was still limited to a   any fundamental reason.”             demand in key sectors.                                                     company defaulted. YRC, which         offered to tender.
                                                                                                                Bottom Line                                                                                                Saturday, January 2, 2010          29


Fox grants brief extension to cable contract
AP                                                                                                                                                         Fox has said it needs sub-
                                                                                                                                                         scription revenue to supple-
LOS ANGELES      Fox and Time                                                                                                                            ment the advertising revenues
Warner Cable extended their                                                                                                                              that have supported its broad-
contract for a few hours, avoid-                                                                                                                         cast network up until now.
ing a threatened blackout of                                                                                                                               Separately,           Sinclair
several stations from the cable                                                                                                                          Broadcasting Group, which
provider while the two sides                                                                                                                             owns broadcast stations in mar-
tried early Friday to resolve a                                                                                                                          kets as large as Des Moines and
disagreement over fees.                                                                                                                                  Cedar Rapids, Iowa, agreed to
   Time Warner Cable Inc. made                                                                                                                           an eight-day extension for cable
the announcement as the clock                                                                                                                            TV      operator     Mediacom
rolled past midnight on                                                                                                                                  Communications Corp. to carry
Thursday on the East Coast. In a                                                                                                                         Sinclair’s Fox and CBS stations.     Allianz foresees a massive recovery for Germany’s economy this year.
brief statement at 5:30 a.m. EST
on Friday, Scott Grogin, Fox sen-
ior vice president for communi-
cations, said “we are still negoti-
                                                                                                                                                          S  ix Fox cable chan-
                                                                                                                                                          nels, including FX,
                                                                                                                                                                                              Allianz predicts good
ating.”
   The extension for a few hours
made it appear likely that at the
very least a further extension
                                                                                                                                                          Speed and Fuel, and
                                                                                                                                                          certain regional sports
                                                                                                                                                          networks were still
                                                                                                                                                                                              year for Germany in ’10
would be granted, allowing mil-                                                                                                                           being distributed                   AFP
lions of cable subscribers access
to Friday’s Sugar Bowl between
the Florida Gators and the
                                                                                                                                                          throughout the Time
                                                                                                                                                          Warner Cable and
                                                                                                                                                          Bright House
                                                                                                                                                                                              BERLIN     Germany’s insurance
                                                                                                                                                                                              giant Allianz foresees a massive
                                                                                                                                                                                                                                    Thegroup’sBild quoted
                                                                                                                                                                                                                                    the
                                                                                                                                                                                                                                        daily
                                                                                                                                                                                                                                               chief
Cincinnati Bearcats. The Cotton                                                                                                                                                               recovery for the country’s econo-
Bowl on Saturday, the NFL’s final                                                                                                                         service territories.                my this year, with growth exceed-     economist Michael
regular season contests on                                                                                                                                                                    ing official forecasts and unem-      Heise as saying that
Sunday and “The Simpsons” and             Fox has said it needs subscription revenue to supplement the advertising revenues that have support-           Mediacom will pay Sinclair a         ployment rising only marginally, a    growth would reach 2.8
other Fox shows were also at risk.        ed its broadcast network up until now.                                                                         higher rate than it was paying       report said on Friday.                %, above the German
   Karen Amaya, a 30-year-old                                                                                                                            under a contract that also was          The daily Bild quoted the          central bank’s predic-
schoolteacher and Time Warner             owns, a move that would have            Six Fox cable channels, includ-   a smaller cable TV operator,         expiring at midnight Thursday.       group’s chief economist Michael
Cable subscriber in Van Nuys,             affected more than 6 million cus-    ing FX, Speed and Fuel, and cer-     Bright House Networks, have            In another fee dispute,            Heise as saying that growth would     tion of 1.6%.
Calif., said she was concerned            tomers of Time Warner Cable          tain regional sports networks        resisted paying a new $1             Cablevision Systems Corp. said       reach 2.8 percent, comfortably
about not being able to see “The          and Bright House Networks in         were still being distributed         monthly fee per subscriber that      early on Friday that it had failed   above the German central bank’s      mass lay-offs in industry, and
Simpsons” on Sunday night,                New York, Los Angeles, Orlando,      throughout the Time Warner           News Corp. is demanding from         to reach a deal to continue car-     prediction of 1.6 percent and the    unemployment would stay well
which her husband watches                 Fla., and other markets.             Cable and Bright House service       both operators. Time Warner          rying HGTV and Food Network          strongest since 2006. Heise said     below the symbolic four million
“religiously.”                               If the signal were dropped on     territories. Carriage arrange-       Cable CEO Glenn Britt has            for its 3.1 million subscribers in   the good performance would be        level.
   She said it was “kind of frus-         cable, people could tune into Fox    ments on those channels weren’t      called the fee demand excessive      the New York, New Jersey and         spurred by a boom in exports, sta-      While many analysts have said
trating” not knowing what would           with an antenna if they have a       to expire until Thursday at mid-     and said the cable operator has      Connecticut, adding it had no        ble domestic consumption, gov-       this mark would be topped, with
happen, especially as both sides          digital TV or converter box. But     night PST (3 a.m. EST).              reached deals for “much lower”       expectation of carrying the sig-     ernment recovery programmes          the Bundesbank predicting 4.2
had heavily advertised the possi-         most Americans these days get           The dispute focuses on how        rates with Fox affiliates — sta-     nals again.                          and tax cuts recently agreed by      million jobless by 2011, Heise
ble disruption.                           broadcast channels through sub-      much Fox is paid by cable com-       tions that carry Fox program-          The channels are owned by          the ruling centre-right coalition.   said they would not exceed 3.67
   Fox had threatened to pull the         scription services such as cable     panies to retransmit its stations’   ming but are owned by other          Cincinnati-based          Scripps       He also forecast that 2010        million, some 240,000 more than
signal from 14 TV stations it             TV or satellite.                     signals. Time Warner Cable and       companies.                           Networks Interactive Inc.            would not see the widely feared      at present.




     GM, SAIC partnership to grab Washington Times cuts jobs; sports out
     bigger Indian auto market pie
                                                                                                                    AP                                                                           The layoffs hit some high-           The Times did not break
                                                                                                                                                                                              profile beats, including journal-    down the cuts, but laid-off
                                                                                                                    WASHINGTON       The Washington                                           ists covering the Justice            staffers described what they
                                                                                                                    Times slashed its staff by more                                           Department, Congress and for-        learned from colleagues.
     AFP                                  to be able to spread its business    its Chevrolet marque in India        than 40 percent and will elimi-                                           eign affairs. The newspaper             Several departments at the
                                          outside of China. There is also a    only in 2003, is the fifth-largest   nate its sports section and most                                          announced several manage-            newspaper are being all but
     NEW DELHI    For GM India chief      big benefit for us to partner with   carmaker in the country. It sold     local coverage in 2010, shifting                                          ment changes, though it’s not        eliminated, said photographer
     Karl Slym, the expansion of the      them,” Slym said. In China,          67,500 vehicles last year, up 9.5    its focus to politics, business                                           clear who will oversee the news-     Allison Shelley. All nine staff
     US auto giant’s 12-year alliance     where General Motors entered         percent from the previous year.      and investigative reporting.                                              room operation. Christopher          photographers were cut, along
     with its Chinese partner SAIC        in 1996, the Detroit-based com-      Analysts see the 50:50 tie-up in        The 27-year-old newspaper                                              Dolan        was        appointed    with the assistant managing
     Motor to tap India’s burgeoning      pany is the second largest           which SAIC is investing cash         announced the latest round of                                             Wednesday as national politics       editor of photography, she said.
     vehicle market is win-win for        automaker, helped by its part-       and GM is supplying its Indian       layoffs in its Thursday edition                                           editor and Brett Decker as edi-      Only two photo editors will
     both sides.                          nership with China’s biggest car-    plants and sales network as giv-     and said the last sports section                                          torial page editor. Jeffrey          remain.
        The      two       companies      maker, Shanghai Automotive           ing GM more resources to grab a      would appear Friday. Among                                                Birnbaum, the managing editor           The graphics and Web
     announced in December a joint        Industry Corp, or SAIC.              bigger share of the Indian mar-      those let go was the newsroom                                             for digital operations, resigned     department staffs were cut
     venture with an initial focus on        GM, which is undergoing a         ket.                                 leader, Managing Editor David                                             that post but will continue as a     nearly in half, and nearly all
     selling mini-commercial vehi-        drastic restructuring after being       It also gives the Chinese car-    Jones. Another round of cuts                                              columnist.                           metro reporters were laid off,
     cles and inexpensive, entry-level    bailed out by the US govern-         maker its first foothold in India,   was made earlier in December,        The paper will publish a new            During his last day at the        Shelley said. Only six copy desk
     cars in India that will later        ment, is expected to post sales in   furthering its aspirations of        and the newspaper published          weekday print edition starting       office, Jones said Thursday that     editors would remain, she said.
     embrace other Asian emerging         China of 1.4 million vehicles this   being an international player.       its last Sunday edition last         on Monday.                           his staff had been working              While newsroom cuts had
     markets. “Our first business         year. But in India, Asia’s third-    India, with its nearly 1.2 billion   weekend.                                                                  under a cloud of uncertainty for     been expected for weeks, the
     move will be in India but it won’t   largest car market after China       population, is one of the world’s       The paper will publish a new        “Our market-based, forward-        about two months.                    photography layoffs came as a
     be the last — we will be spread-     and Japan, where Japanese-           last remaining big-growth mar-       weekday print edition starting       looking plan is both a response         “In spite of that, they’ve been   surprise.
     ing to other areas in Asia. We’ve    owned Maruti Suzuki holds a          kets for global automakers like      on Monday. It will focus on the      to the recessionary economy,         very professional,” he said.            “I don’t think anyone expect-
     made a commitment to expand          commanding leadership posi-          GM, Ford, Toyota, Hyundai and        newspaper’s core strengths,          continued downward financial         “They’ve come in every day and       ed the entire staff of shooters
     in emerging markets,” Slym told      tion, GM has been slower out of      Honda as they grapple with a         including politics and cultural      pressures on the news industry       broken big stories. They’ve put      would be laid off,” said photog-
     AFP in an interview.                 the starting blocks. The US auto     wrenching slump in developed         issues, President and Publisher      and our transition into a 21st       out a product that I’m really        rapher Katie Falkenberg, who
        “There is a big benefit to SAIC   company, which started selling       markets.                             Jonathan Slevin said on              century multimedia enterprise,”      proud of, and I’m proud of           worked at the Times for three
                                                                                                                    Wednesday in a statement.            Slevin said.                         them.”                               years.




Toyota’s hybrid Prius faces US probe into brakes malfunction
AFP                                                                                                                                                                                           what a spokesman called “the            Just 12 months ago the
                                                                                                                                                                                              behavior people are reporting.”      automaker was basking in
DETROIT     Toyota is facing a                                                                                                                                                                   “We’re investigating those        headlines reporting that it had
potential safety issue with its                                                                                                                                                               complaints as quickly as possi-      finally beaten arch-rival General
highest profile vehicle, the                                                                                                                                                                  ble,” spokesman Mike Michels         Motors to become the world’s
Prius, the latest in a plague of                                                                                                                                                              added. Exactly what is happen-       best-selling automaker.
quality problems that forced it                                                                                                                                                               ing is unclear. Like the vehicle’s      But by March, things didn’t
to recall four million vehicles in                                                                                                                                                            gasoline-electric powertrain,        look so good. Battered by the
2009.                                                                                                                                                                                         the brakes are also a hybrid         recession in the US, its key mar-
   A growing number of owners                                                                                                                                                                 technology.                          ket, the maker reported its first
allege that the brakes on the                                                                                                                                                                    During light to moderate          annual loss in a half century.
third-generation, 2010 Toyota                                                                                                                                                                 braking, the car is slowed by a         In August, a California
Prius can malfunction unex-                                                                                                                                                                   regenerative system that turns       Highway Patrol officer and
pectedly, with at least 20 com-                                                                                                                                                               the vehicle’s kinetic energy into    three members of his family
plaints filed so far with the                                                                                                                                                                 electricity, which is then stored    were killed in a fiery crash when
National Highway Traffic Safety                                                                                                                                                               in a battery. For more aggressive    their Lexus went out of control.
Administration.                                                                                                                                                                               stops, the Prius also has a con-        Two months later, Toyota
   The Japanese automaker said                                                                                                                                                                ventional hydraulic brake sys-       announced it would recall 3.8
it has launched its own investi-                                                                                                                                                              tem.                                 million vehicles, blaming the
gation.                                                                                                                                                                                          Some speculation focuses on       problem on floor mats that
   Robert Becker, 39, is one of                                                                                                                                                               the regenerative system, and         could come loose and jam the
those filing among at least 20                                                                                                                                                                whether a sharp jolt to the vehi-    accelerator pedal.
who have already submitted                                                                                                                                                                    cle could inadvertently trick           Another recall impacted
their concerns to the National                                                                                                                                                                vehicle sensors and controls         110,000 Tundra pickups which,
Highway        Traffic     Safety                                                                                                                                                             into releasing the brakes.           according to NHTSA, are prone
Administration’s Office of                                                                                                                                                                       But Michels cautioned             to “excessive corrosion” so
Defects Investigation.                                                                                                                                                                        Toyota will have to look at a        severe their brakes could fail.
   He says he was heading to                                                                                                                                                                  variety of things. “Rather than         In all, Toyota will have
work on the west side of                  The Prius brake problem has become a hot topic on numerous websites, but federal investigators are so far declining to comment,                     throwing out theories, the           recalled around four million
Manhattan, coming up to an                although the file is open to the public.                                                                                                             important thing is to do a scien-    cars, trucks and crossovers, in
intersection and squeezing the                                                                                                                                                                tific analysis. When we have an      the United States, during 2009.
brakes of his 2010 Prius to slow          to slam down on the pedal.             Becker is not alone, as            bump, but when this same             become a hot topic on numer-         answer, we will provide it to        That’s about four times more
down.                                       “It scared the hell out of me. I   NHTSA’s defects office reveals.      thing happened three days ago        ous websites, but federal inves-     owners as soon as possible,” he      than in previous years.
   But when the car hit a pot-            wasn’t sure I could stop in time,”     One complaint on file quotes       on slippery, icy roads, I knew for   tigators are so far declining to     said.                                   And it means Toyota will have
hole, Becker suddenly had the             he said, adding the problem has      an owner: “Initially, I convinced    100 percent certain I had not let    comment, although the file is           The Prius problem is one of       recalled more vehicles than any
“sensation of losing control,” as         repeated itself a number of          myself I must have been letting      up on the brake.”                    open to the public.                  the last things Toyota needs         other auto manufacturer for the
the brakes released, forcing him          times since then.                    up on the brake when I hit the         The Prius brake problem has           Toyota admits it is aware of      right now.                           first time ever.

				
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