USA
Romney softens tone with Latinos, talks immigration Presidential candidate Mitt Romney tried to make up ground with Hispanic voters on Thursday after he and Republican rivals took hard-line stances against illegal immigration in the primary season. Caught flat-footed by President Barack Obama on immigration last week, Romney promised a long-term solution to let young illegal immigrants stay in the United States, but offered only a few minor proposals.
Romney told a meeting of a national Hispanic group in Florida that he would replace and supersede Obama’s executive order
allowing hundreds of thousands of immigrants brought to the country illegally by their parents to avoid being sent home.
Pro-Obama Super PAC narrows fundraising gap in MayThe outside ‘Super PAC’ helping US President Barack Obama’s re-election campaign raised USD eight million in May and so far in June, marking its best months ever as it tries to catch up to deep-pocketed Republican rivals in the money chase ahead of the November 6 election. In federal filings released on Wednesday, Priorities USA Action reported raising USD four million in May and having USD 4.5 million left in cash on hand. A source familiar with the group’s fundraising said Priorities has brought in another USD four million this month.
WORLD
Aung San Suu Kyi calls for UK’s support to Burma Burmese Opposition Leader Aung San Suu Kyi has urged the UK to support moves for democracy in Burma, in an historic address to both houses of parliament. Suu Kyi said the support of people in the UK and around the world could get Burma much further towards change. She earlier met Prime Minister David Cameron at Downing Street. Suu Kyi, who spent two decades until 2010 under house arrest during military rule in Burma, is the first non-head of state to address parliament. She was greeted by applause when she was introduced to MPs and peers in parliament’s Westminster Hall by Commons Speaker John Bercow, who described her as “the conscience of a country and a heroine for humanity”.
Pakistan officials ‘harass’ the US diplomats Rising obstruction of US envoys by officials in Pakistan is ‘significantly impairing’ the work of US personnel there, a state department report says. The findings said 2011 interference by Pakistani officials reached new levels of intensity. The US raid on Osama Bin Laden’s compound and a Nato air strike that killed 24 Pakistani soldiers were identified as turning points. Recent months have seen a marked deterioration of US-Pakistan relations. Pakistan withdrew military co-operation in the wake of the deadly November air strike, and correspondents say it marked a change in relations between the two countries. The
report, by the state department’s inspector general, acknowledged that the Pakistani government had previously interfered with US
officials on its soil. However, it said the problem had become much worse and recommended that the issue should be taken up by the US with Pakistan at the highest levels of government.
AUSTRALIA
Qantas has warned the federal government Australia’s flagship airline could disappear if Etihad Airways is allowed to double its stake in Virgin Australia. Etihad, which is fully owned by the Abu Dhabi government, bought a four per cent stake in Virgin Australia in early June and is understood to be seeking to boost its share to 10 per cent. Qantas Chief Executive Alan Joyce has led a delegation in Canberra this week lobbying the federal government and the opposition against allowing Etihad to push into Virgin. They argued Qantas could ‘go under’ if the deal was allowed as it would enable Virgin Australia to undercut Qantas on profitable domestic routes, Fairfax Media reported.
Fortescue Metals Group has lodged a high court challenge against the federal
government’s mining tax, just a week before the tax is introduced. Chief Executive Nev Power said the iron ore miner would challenge the Minerals Resource Rent Tax (MRRT) on constitutional grounds. “We believe we have a good case for challenging the MRRT on
constitutional grounds and we look forward to the resolution of these important issued by the high court,” he said. Fortescue’s case will challenge the MRRT on a number of grounds including it discriminates between the states according to a section of the constitution,
curtails state sovereignty and that it gives preference to one state over another.
Australian banks charged an extra USD 100 million in fees last year, but there was some relief for households as banks switched their focus away from consumers to businesses. A report released by the Reserve Bank of Australia (RBA) revealed the banks chalked up USD 11.3 billion in fee revenue. It was good news and bad, with a seven per cent drop in fees paid by households but a 5.5 per cent jump in fees on business. The RBA report found households paid USD four billion in fees last year, down from USD 4.3 billion the year before. Fees charged on deposit accounts fell 13.3 per cent, providing the biggest savings to households.
BANGLADESH
The Asian Development Bank (ADB) will provide USD 50 million to Bangladesh to improve the environment by financing more energy-efficient brick kilns in the country. A loan agreement to this effect was signed at the Economic Relations Division (ERD). Senior Secretary of ERD, Iqbal Mahmood and ADB Country Representative, M Teresa Kho signed the agreement for Bangladesh and ADB respectively. The ADB and Financial Institutions Division under the Ministry of Finance will be the executing agency and the Bangladesh Bank will be the implementing agency of the project during 2012 to 2015 period.
A Japanese company, City Network Inc, will set up an agro-processing plant in the port city apart from its current engagements in various areas. Hisayuki Mutoh, a high official of the company, informed this during a meeting with the leaders of Chittagong Chamber of Commerce and Industry (CCCI). CCCI Acting President, Nurun Newas Salim and Directors Mazharul Islam Chowdhury, SM Mahbubul Islam, M Emdadul Hoque Chowdhury, M Ahid Siraj Chowdhury, M Jahurul Alam, Mohammad Habibul Hoque, Morshed Arif Chowdhury and Omar Faruque, among others, were present in the meeting. During the meeting, Nurun Newas Salim said Japan is a very important partner in socio-economic development of the country.
CHINA
Two of China’s top telecommunications companies may be selling subsidised gear in the United States, and legislation could be proposed to deal with any related national-security threat, the head of the US House of Representatives’ Intelligence Committee said on Thursday. The committee is investigating what some US officials suspect are close ties between the Chinese government and each of the firms, Huawei Technologies Co Ltd and ZTE Corp. “The concern is whether any of their equipment or its software is designed to steal information or establish the ability to do cyber attacks,” said panel Chairman Mike Rogers. Many believe that the gear is subsidised so it can be multiple times cheaper than any local competitor, Rogers said.
Shares in Evergrande Real Estate fell more than four per cent, extending a sharp slide in the previous session, and China’s second-largest property developer by sales said it was considering legal action against Citron Research, a short seller which alleged it was insolvent. Evergrande bonds shed 1.3 basis points on Friday, with its 2015 bonds opening at 90.1 cents on the dollar. They, too, were hit hard on Thursday, with the 2015 bonds down seven basis points. According to Thomson Reuters data, Evergrande has outstanding bonds of around USD 2.8 billion.
China’s crude imports from Iran recovered in May to offset a first-quarter plunge in shipments to nearly half the annual average, after the two nations resolved a wrangle over the terms of annual oil sale contracts. Yet imports in the first five months fell a quarter from a year ago with US Secretary of State, Hillary Clinton saying China was slowly but surely taking action to cut reliance on Iranian crude. Total shipments for the year are expected to stay low as the country’s top buyer rejected Tehran’s offer of discounted oil. The United States and Europe have
imposed heavy sanctions to force Iran to stop its controversial nuclear programme they believe is designed to develop atomic weapons. The West wants Iran’s top oil consumers to cut imports to stem the flow of petrodollars.
EUROPE
Independent auditors said Spanish banks may need up to 62 billion euros in extra capital, to be filled mostly by a Euro Zone bailout, after Spain’s medium-term borrowing costs spiralled to a euro-era record on Thursday. Euro Zone finance ministers met in Luxembourg to discuss how to channel up to 100 billion euros in aid to Spanish lenders weighed down by bad debts from a burst property bubble. Madrid’s economy minister said a formal request would be made in days for the bailout, which was agreed two weeks ago. Many in the markets see the package as a mere prelude to a full programme for the Spanish state, which Madrid vehemently denies it will need. Spain’s financial plight took centre stage a week before a European Union summit tackles long-term plans for closer
fiscal and banking union in a bid to strengthen the euro’s foundations, after bailouts for Greece, Ireland and Portugal failed to end a two-and-half year old debt crisis.
Accused of irritating France and Russia, frustrating the United States and falling into a testy exchange with Argentina over the Falklands, David Cameron’s G-20 summit did not go well. As he returns from Mexico, the British prime minister is probably hoping to put the series of apparent diplomatic missteps behind him, but it may not be that easy. Beyond the personal criticism of Cameron, a belief seems to be growing in several foreign capitals that Britain itself is losing its influence partly due to hostility in his Conservative Party to the European Union and the euro project. Diplomatic insiders and veterans say that Cameron at the very least ruffled feathers at this week’s summit in Los Cabos and provided an unnecessary distraction.
Doctors in Britain’s state-funded health service took industrial action for the first time in 37 years in a dispute over changes
to their pensions, cancelling thousands of patients’ non-urgent appointments and operations. The medics are the latest group of public sector workers to take industrial action in recent months over government cuts to taxpayer-funded pension schemes. Doctors would only treat urgent and emergency cases in a 24-hour protest against government plans to make them pay more towards their pensions and retire at a later age, their union, the British Medical Association said.
INDIA
Shares in cement manufacturers fell in early trade on Friday after they were fined a combined USD 1.1 billion for price fixing, even as many of them vowed to appeal the ruling by the nation’s increasingly assertive anti-trust regulator. Eleven of the country’s biggest cement companies were handed the record fine by the Competition Commission of India, which found them guilty of colluding to push up prices by under using their plants and creating artificial shortages. The bigger-than-expected penalty, seen as a flexing of muscles by the regulator, is likely to be dragged into a legal quagmire as the cement manufacturers prepare to enter an appeals process.
Reliance Industries (RIL) Chairman Mukesh Ambani may let go of the textile business, including the ‘Only Vimal’ brand and the
Naroda facility, which was the first manufacturing asset built by his father Dhirubhai Ambani four decades ago. Textile business contributes less than a per cent of the RIL’s total revenues and the return on investments has not kept pace with RIL’s strategy of minimum 20 per cent return. Three senior Reliance officials separately confirmed that the group was exploring all strategic options, including a sale of the textile operations. RIL spokes-person, however, declined to comment.
The government is moving swiftly to build a consensus over the move to allow foreign investment in the multi-brand retail sector with the Commerce, Industry and Textiles Minister Anand Sharma writing to three key state chief ministers of Uttar Pradesh, Punjab and Odisha to seek their support. Sharma has been trying to build a consensus and has met several chief ministers to draw their support to the move. Some chief ministers have backed the move to open up the multi-brand retail sector, which has emerged as a test case for moving ahead with economic reforms. “I hope that being a chief minister who is known for his progressive outlook and global vision, you will recognise intrinsic merit of this policy and give your support and understanding in the matter,” Sharma said.
JAPAN
Rival Japanese television makers Sony Corp and Panasonic Corp will next week
announce an agreement to cooperate in
developing ways to mass produce next gene-ration organic light emitting diode televisions, two sources familiar with the matter told Reuters on Friday. The two companies are in talks to develop the technology to build the screens at more affordable prices as they look to counter competition from South Korea’s Samsung Electronics and LG Electronics. Japanese firms that dominated the global TV market in the 1980s and 1990s have been
battered by their aggressive Korean rivals, along with weak demand for the TVs.
Japan Airlines (JAL) applied on Wednesday to re-list its shares in September after it raised about USD eight billion in an initial
public offering, doubling the government’s
investment in a rare successful case of
state-led restructuring in Japan. The carrier, which rebounded sharply from bankruptcy and is booking record profits, submitted its application to the Tokyo Stock Exchange after an annual shareholder meeting, a person with knowledge of the matter said. JAL is looking to raise 600 to 700 billion yen in the IPO, sources have said, which would make it the second biggest offering this year after social
networking giant Facebook’s USD 16 billion IPO, and the seventh-largest ever in Japan.
MALAYSIA
Tracking solutions provider Grand-Flo Solution expects to supply more than 50 million ringgit worth of products and services to HeiTech Padu for one year. Grand-Flo, which is an associate company of HeiTech Padu, also wants leverage on the latter capability to
secure more government projects. Hei-Tech Padu owns 20 per cent of Grand-Flo. Grand-Flo group Managing Director, Derrick Tan said the group expected to get more orders from Hei-Tech Padu, particularly through its road transport department’s projects. “We are expecting to secure up to six million ringgit worth of
projects or more in the near future,” he said after Grand-Flo’s shareholders meeting.
Louis Dreyfus Commodities Asia (LDCA) has confirmed it would be a strategic partner with Felda Global Ventures Holding (FGVH). It said on Friday it had reached final agreement with FGVH on the terms of their strategic
partnership. LDCA said all the necessary
approvals from LDCA have been granted and that the final agreement was still subject to approval from the board of directors for FGV’s subsidiaries. To recap, a MoU was signed last month for LDCA to be a strategic investor and partner to enhance the marketing and trading of FGV’s palm oil business.
PAKISTAN
Pakistan International Airlines (PIA)
Chairman, Air Chief Marshal Rao Qamar Suleman has termed the carrier a big organ-isation where efforts to achieve a turnaround in fortunes will take at least one year to show results. “I do not have a magic wand to turn around a big organisation like PIA in a few months. Our efforts will give you concrete
results in at least one year,” said Suleman, who joined PIA around two months ago. He was talking to the media at a seminar on ‘Challenges for Aviation Safety in Pakistan and South Asia’ on Thursday.
Following the signing of an agreement with the government of Pakistan for providing USD 840 million for the 1,410 megawatt (MW) Tarbela fourth extension project, the World Bank has also agreed to extend financial
assistance to the 4,320 MW Dasu Hydropower Project. It has also been agreed that the
project will be constructed in phases after work on the 4,500 MW Diamer-Bhasha Dam is initiated and its financial plan is finalised.
Water and Power Development Authority (Wapda) Chairman Shakil Durrani stated this while presiding over a meeting at the Wapda House to discuss the report submitted by an international panel of experts.
RUSSIA
Russian steel company Severstal will focus on expanding the customer base for its current plants in the United States rather than buying other factories in the country, Chief Executive, Alexey Mordashov said. That means it has no plans to buy the former
Severstal plant in Maryland now owned by bankrupt RG Steel or an Alabama facility that Germany’s ThyssenKrupp AG is looking to sell, Mordashov told Reuters in an interview.
Dismal market conditions combined with
despair about the Euro Zone’s mounting debt crisis have almost brought the mergers and acquisitions market to a standstill, just as five major steel assets in Brazil and the US have been put on the block.
Russian President Vladimir Putin sought to reassure investors that he is committed to build a new economy through liberal reforms and privatisation, and said he would not let protests against his rule spill over into civil unrest. But in his first big speech to investors since his return to the Kremlin in May, Putin offered almost nothing new and not everyone was convinced he will do any more to carry out promises of economic and political
reforms in his new six-year term than in his last 12 years as Russia’s paramount leader. “He was saying the right things to this
audience, but the impact of those words is
becoming less and less,” said Roland Nash, chief investment strategist at Moscow-based hedge fund Verno Capital.
THAILAND
The Euro Zone crisis is likely to have only a slight impact on the Thai economy, since Thailand has been enjoying financial stability, and it is quite well-prepared for dealing with the situation. Deputy Prime Minister and
Finance Minister Kittiratt Na-Ranong said that various government agencies concerned
are closely monitoring economic woes in
Europe. The direct and indirect impacts of the volatility of the Euro Zone crisis to the Thai economy are being analysed. He stated that the export industry might be affected slightly, as Europe is Thailand’s major export market.
Thai auto sales in May hit a record high of more than 115,000 units, a 107.6 per cent increase, Toyota Motor Thailand Senior Vice President, Wuttikorn Suriyachantananon said. Total auto sales in May were recorded at 115,943 units, including 55,983 sedans — an
increase of 137.5 per cent, 59,960 vehicles for commercial purposes — an increase of 85.8 per cent. Automotive sales in May hit a record high monthly sales volume, resulting from the popularity of new auto models and the
government’s supportive measures. Moreover, production capacity of all automakers has returned to normal, so they can now deliver more cars to customers, Wuttikorn said.
USA
US manufacturing grew at its slowest pace in 11 months in June and the number
of Americans filing new applications for
unemployment aid fell only slightly last week, further evidence the economy was weakening. Other reports underscored the difficulty the economy was having breaking out of a soft patch. Factory activity in the Mid-Atlantic region tumbled to a 10 months low in June and home re-sales slipped in May. “Today’s
numbers are ugly. The economy is in another mid-year slump, growth will struggle to breach two per cent and the odds are rising that the fed will need to do more, probably as soon as its August meeting,” said Ryan Sweet, a senior economist at Moody’s Analytics in West Chester Pennsylvania.
Ratings agency Moody’s downgraded many of the world’s biggest banks lowering credit ratings of 15 companies by one to three notches. Morgan Stanley, one of the most closely watched firms, had its long-term debt rating lowered by just two notches, one level less than had been expected, and its stock rose in after-hours trading. The downgrade left Morgan Stanley more highly rated than Bank of America Corp and Citigroup but a step below Goldman Sachs Group. Credit Suisse, which was warned about weak capital levels by Switzerland’s central bank, was the only bank to suffer a three-notch downgrade.
In the latest skirmish between Las Vegas Mogul Steve Wynn and Wynn Resorts’ once largest shareholder, a federal judge ordered the legal battle with Japanese Billionaire Kazuo Okada to be moved back to the Nevada state court. The decision sends the case back to the same court that previously frustrated Okada’s attempts to access Wynn Resorts’ financial records. Okada, in his suit in January, alleged that the casino company’s USD 135 million donation pledge to University of Macau Development Foundation was ‘inappropriate’. In February, Wynn Resorts responded with its own accusations.
