Asia-Pacific
Asia-Pacific nations meet to battle global gloom JP/
Asia-Pacific nations meet to battle global gloom
SUZHOU, China (Reuters): Asia-Pacific finance ministers, grappling with a global slowdown and wide divisions over how to deal with it, gather this week in one of the few countries managing to thrive despite the slump -- China.
Deputy ministers and central bankers from the Asia-Pacific Economic Cooperation (APEC) forum kick off two days of talks in the city of Suzhou on Thursday, with finance ministers meeting on Saturday and Sunday.
The gloom hanging over the meeting is a stark contrast to the early days of APEC a decade ago, when participants believed they were witnessing the dawn of a "Pacific century" of startling economic growth that would eclipse the rest of the world.
That optimism is long gone, strangled by the brutal economic crisis that hit southeast Asia in 1997, financial turbulence in South America, deep-seated problems in Japan and the sharp slowdown in the U.S. and the global technology sector.
FROM BOOM TO GLOOM
When APEC finance ministers gathered last year in Brunei, Asia's recovery from crisis seemed comfortably on track.
No more.
The U.S. economic slowdown and slumping exports have weighed on Asia. Singapore slipped into recession in the first half, Japan and Hong Kong teeter on the edge and Taiwan has suffered its first contraction in 26 years. South America, meanwhile, has been shaken by Argentina's debt troubles.
2. ( 3 x 21 )
IMF says making fewer conditions on its lending
JP/
IMF says making fewer conditions on its lending
WASHINGTON (Reuters):The International Monetary Fund (IMF) said on Tuesday it has pared back the amount of conditions its attaches to its loans, but that more needs to be done on the policy, which aims to give borrowers more freedom in setting their own economic policies.
An IMF executive board assessment on the new policy, which has been in place for less than a year, found there has been a notable reduction in the numbers of conditions attached to loans to poor countries, mainly in Africa.
But, it also found that some of its recent standby loans, the sort of facilities used by nation's like Argentina and Brazil, have had more conditions attached to them since the new policy was put in place.
The board discussion, which took place at the end of July, also revealed that some IMF directors would like to see the lender become, "more selective in providing financial support to countries, particularly in cases where there is weak track records or an insufficient commitment to the program."
Sources on the IMF's board told Reuters that the United States and Britain were the most vocal in demanding less loans to countries with bad track records of performing under earlier loans, such as Kenya and Zimbabwe.
"The United States and Britain want the IMF to be more selective, in the belief that by lending to countries that have performed well in the past, you will have a greater chance of success with IMF programs," the board member said.
3. ( 2 x 15 )
U.S. economy sees clear recovery sign JP/
U.S. economy sees first clear sign of recovery
NEW YORK (Reuters): A report on Tuesday suggesting the hard- hit U.S. manufacturing sector is finally pulling out of its year- long slump provided the most solid evidence yet the stalled U.S. economy is on a path to recovery.
The National Association of Purchasing Management's monthly index, the nation's main barometer of factory activity, registered its biggest jump in five years in August when it rose to 47.9 from 43.6 in July. That was well above economists' forecasts of a 43.9 reading.
Although the report showed overall manufacturing activity still contracted for the 13th straight month, new orders for manufactured goods rose for the first time in 13 months, production rose for the first time in eight months and new export orders were up for the first time in four months.
The NAPM data lit an early rally in U.S. stocks that boosted the blue-chip Dow Jones industrial average more than 2 percent and the Nasdaq index more than 1 percent. But those gains disappeared by the close of trading, and the Dow ended less than half a percentage point higher and the Nasdaq was off 1.9 percent.
Bond prices were hammered as Wall Street scaled back expectations of another Federal Reserve rate cut in October. The 30-year bond fell nearly two full points. The dollar racked up its biggest one-day gain against the euro this year.
"The recovery starts right here; further Fed easing is unnecessary," said Ian Shepherdson, chief U.S. economist at High Frequency Economics in Valhalla, New York.
Analysts said the NAPM report was clearly cause for optimism that the economy was turning around after a sharp slowdown over the past year. But they cautioned not to expect it to come roaring back quickly.
4. ( 2 x 24 ) Thai, Indonesia, Malaysia mull joint rubber export quota JP/MALAYSIA
Thailand, Indonesia, Malaysia consider joint rubber export quota
KUALA LUMPUR (AFP): The world's top three rubber producers -- Thailand, Indonesia and Malaysia -- may adopt a joint export quota to control supply to boost sagging prices, a report said Wednesday.
A Malaysian official said apart from export quotas, a supply rationalization and stockpile scheme was also being considered.
Senior officials of the three Southeast Asian countries are meeting in Kuala Lumpur under the Tripartite Rubber Cooperation (TRC) for the third time. It held its first meeting in 2000 in Indonesia.
"We are leaving no stone unturned in devising an effective mechanism to boost rubber prices," the official was quoted as saying by Business Times newspaper.
Thailand, Indonesia and Malaysia together produce 79 percent of the world's natural rubber.
The newspaper said all proposals and recommendations emerging from the discussions would be forwarded to the ministers for adoption Friday.
At a meeting last July in Bangkok, Malaysian Primary Industries Minister Lim Keng Yaik along with his two counterparts agreed to cut rubber output by four percent a year from 2001.
"With strong cooperation from all three producers, the TRC can be expected to boost prices substantially," the official said.
5. ( 2 x 24 )
HP buyout to affect Asia-Pacific operations JP/
Hewlett-Packard buyout likely to affect Asia-Pacific operations =
Singapore (DPA): The buyout of Compaq Computer by Hewlett- Packard (HP) is likely to result in significant job cuts in Singapore and the Asia-Pacific region, industry analysts said on Wednesday.
"They are going to rationalize product lines, people, suppliers and sales channels, and they need to do that very quickly," said Ian Bertram, regional director of the Gartner Group.
Both companies have Singapore operations and a large portion of Asia-Pacific headquarter functions there.
HP in the city-state employs 6,500 staff, of whom 4,000 are executives and professionals, and the rest in contract manufacturing. Compaq employs another 1,000 in Singapore.
In announcing its purchase of rival Compaq, HP said global job cuts of 15,000 were expected from its mega-deal. It identified servers, administration, PCs and information technology as the main areas of savings.
Servers would likely be the first product to be hit since both companies have server operations, such as assembly lines, in Singapore, an industry source told The Straits Times.
"But for PCs, the Compaq PC people are likely to be safer because they are far ahead of HP in that area," he was quoted as saying.
6. ( 2 x 21 )
Daum files legal action against Windows XP JP/
Daum files legal action against Windows XP
SEOUL (Reuters): Daum Communications, South Korea's largest Internet portal, said on Wednesday it had filed a complaint against Microsoft Corp., over the U.S. software giant's planned release of its new operating system Windows XP.
"We filed a complaint against Microsoft with the Korea Fair Trade Commission this morning," said a spokeswoman for Daum.
In the complaint, Daum said Microsoft's bundling of a variety of application software -- including instant messaging, Internet phone service and digital pictures -- to Windows XP constitutes an unfair business practice.
Windows XP, the latest version of Microsoft's flagship product, is scheduled for widespread retail release on Oct.25.
Kwon Chan, a spokesman for Microsoft Korea, said his company had no official comment on the issue.
"We need to go through the complaint in detail before issuing any official comment," he said. "But if the Fair Trade Commission wants to make enquiries to us about it, we are willing to respond to it."
The Fair Trade Commission (FTC) said it would launch an official investigation into the case soon.
7. ( 2 x 24 )
GM to buy Daewoo plants for US$782 million JP/
GM to buy two Daewoo plants for US$782 m -paper
SEOUL (Reuters): U.S. auto giant General Motors (GM) is ready to pay nearly US$782 million to buy two plants from South Korea's bankrupt Daewoo Motors, the Korea Economic Daily reported on Wednesday, citing no sources.
GM and Daewoo's main creditor, state-run Korea Development Bank (KDB), declined to comment on the report.
"Due to the ongoing status of talks with the Korean side, it would be inappropriate to comment on specific issues," GM spokesman Rob Leggat said.
"Talks are still progressing," a KDB spokesman said, reiterating comments on Tuesday by Finance Minister Jin Nyum. "That is all we can say at this point."
A senior Finance Ministry official told Reuters last week GM had made a final offer for Daewoo that excluded its largest and most antiquated plant of Pupyong, which employs almost half the Korean firm's workforce and is highly sensitive politically.
Shares of Daewoo Motor Sales, which trade as a proxy for the unlisted automaker, were up 2.42 percent at 3,510 won (US$2.74) by 0107 GMT, while the broader Korea Composite Stock Price Index was down 1.27 percent at 551.71.
8. ( 2 x 14 )
Chipmakers mull complaint to Hynix
JP/
European Chipmakers Mull Complaint Against Korea's Hynix
BERLIN (Dow Jones): The European Union Commission appears likely to come under pressure soon to impose trade restrictions against ailing South Korean chip maker Hynix Semiconductor Inc., sources in the European semiconductor industry said Tuesday.
"The overall consensus in the industry is that Hynix is the beneficiary of financial assistance that provides it with an unfair advantage in the world market for semiconductors," said one official who asked not to be named. "We hope that international regulatory bodies can resolve this issue in a timely manner."
A formal industry complaint to the E.U. Commission, which manages trade policy for the 15-member E.U., could be just a week away, the source said.
If a complaint is filed, it would be another blow to the cash- strapped Korean chip maker, whose creditors are currently mulling a bailout package.
U.S. rival Micron Technology Inc. is also considering filing a complaint against Hynix and other Korean and Japanese chip makers.
Hynix, which makes dynamic random access memory chips, has suffered along with the rest of the semiconductor industry because of the unprecedented slump in chip prices.
INFINEON SEEKS SUPPORT
The Brussels-based Commission has the authority to impose "provisional" duties lasting four to six months on E.U. imports, depending on whether it is an anti-dumping or anti-subsidy case.
Such a move would come only after a Commission investigation, which must stem from a complaint by companies representing 25% of a product's European market share. The inquiry could last up to nine months.