USA

Obama chides Romney President Barack Obama accused Republican rival Mitt Romney of kowtowing to conservatives when he changed his position on what to call the healthcare reform provision that requires people to buy insurance. Obama said Romney had defended the individual mandate as a penalty when he backed it as part of healthcare reform in Massachusetts as governor, but changed his tune on the national healthcare law after criticism from fellow Republicans. “The guy I’m running against tried this in Mass and it’s working just fine, even though now he denies it,” said Obama. The individual mandate, which demands everyone who can afford to buy health insurance does so or face a fine, was upheld as constitutional by the US Supreme Court last week after a majority of the court judged this fee was allowed under Congress’s power to tax. 

Clinton to visit Laos, Egypt and IsraelSecretary of State, Hillary Clinton is to become the first top US diplomat to visit communist-run Laos in 57 years, as part of an eight-nation tour that also takes her to Egypt and Israel, the State Department announced on Thursday. “Clinton will travel to France, Japan, Mongolia, Vietnam, Laos, Cambodia, Egypt and Israel, departing Washington DC on

July 5,” said a statement from State Department Spokeswoman Victoria Nuland, released upon their departure. Clinton was officially invited to Laos by counterpart Foreign Minister Thongloun Sisoulith in 2010 when he made the first visit by a top Laotian official to Washington since Soviet-backed communist rebels swept to power and replaced the monarchy there in 1975.

WORLD

Oil terminals in east Libya ‘forced to shut’Armed federalists forced two oil terminals in east Libya to halt production, sources said, days ahead of the first elections since a popular uprising toppled the regime of Moamer Kadhafi. “The harbour is closed. The pumping and loading of oil has been stopped. The group that came were federalists,” said Tumi Shakari, a supervisor at a major oil terminal in the port town of Ras Lanuf. The action follows threats from a pro-federalism movement to boycott and sabotage the July 7 poll, the first since last year’s

uprising. “A group of 15 people came around 9:30 pm and in a very peaceful and amicable manner asked us to shut down operations,” the supervisor added.

Argentina’s Videla and Bignone guilty of baby theftTwo former leaders during Argentina’s military rule have been found guilty of overseeing the systematic theft of babies from political prisoners. A court in Buenos Aires sentenced Jorge Videla to 50 years in prison and Reynaldo Bignone to 15 years. They are already serving lengthy jail sentences for crimes committed under military rule, between 1976 and 1983. At least 400 babies are thought to have been taken from their parents while they were held in detention centres. The verdict is the culmination of a trial that began in February 2011. In total, 11 people, most of them former military and police officials, were facing charges. Nine, including Videla and Bignone, were convicted in the case over the theft of 34 babies. Two were found not guilty.

AUSTRALIA

Australia’s construction sector contracted for the 25th straight month in June, showing recent interest rate cuts have failed to revive the struggling sector’s fortunes.

The Australian Industry Group (AiG) released performance of construction index (PCI), which showed flat at 34.8 in June. A reading below 50 indicates a contraction and the distance from that key level indicates the strength of the decrease. The weak result comes despite the Reserve Bank of Australia cutting the cash rate 1.25 per cent points to 3.50 per cent since November last year.

Construction activity fell to its lowest level since 2009, the AiG said, with apartment building the weakest sub-sector (with an

index reading of 21.8), followed by commercial construction (26.6) and house building.

Supermarket giant Woolworths have been accused of using brutal negotiations to squeeze price cuts from suppliers to help fund a price war with rival Coles. Some suppliers have been given two weeks to find cost savings of between five and 10 per cent or face the prospect of their products being removed from Woolworths’ shelves, Fairfax reports. One supplier told Fairfax the supermarket giant was using its dominant size as a blunt negotiating instrument in the hopes of improving its standing against Coles.

“This is only about boosting Woolworths’ margins...there has never been any discussion about passing the cost reductions on to

consumers,” the unnamed source said.

The share and property portfolio of ABC Childcare Founder Eddy Groves has been laid bare in a South Australian Supreme Court judgment. Justice Malcolm Blue ordered Groves to pay Commonwealth Bank almost USD 8.4 million in principal and interest for a USD five million unsecured loan it advanced in September 2006 to allow him to buy the home of Adelaide basketball, the Adelaide Arena. While the judgment was delivered two weeks ago, it was suppressed until Thursday to protect against publication of the finances of Groves.

BANGLADESH

The World Bank is supporting the government for the Integrated Agricultural Productivity Project (IAPP) that aims to

benefit approximately 300,000 small and marginal farmers in northern and southern districts. The Bangladesh government places top priority on agriculture and food security. The Upazila Project Coordinating Committees have already selected 375 unions for piloting. The project has distributed 13.5 tonnes of improved seeds of different crops to the farmers. Bangladesh Agriculture Development Corporation has produced more than 122 tonnes of seeds.

The Central Bank of Bangladesh has purchased USD 20 million from three commercial banks to keep the inter-bank foreign exchange market stable, officials said. “The central bank has bought the USD from the banks at market rate aiming to keep the exchange rate of the local currency against the greenback stable,” a senior official of the Bangladesh Bank (BB) told BBN in Dhaka. He also said the central bank may continue such intervention in line with the market requirement. The central banker said the BB also similarly purchased USD four million on Monday from two commercial banks on the same ground. A total of USD 24 million was bought from the commercial banks in the

last two days of this fiscal year as part of its intervention in the market, they added.

CHINA

China’s annual export growth probably slowed in June as much of Europe slid into recession and the US recovery faltered, but Chinese imports likely steadied in a positive sign of still-strong domestic consumption, a Reuters poll showed. With major world economies hobbled by Europe’s debt crisis, the health of the world’s second-largest economy has been closely scrutinised as a buffer to the slowdown in global trade. A pair of Chinese manufacturing surveys has shown persistent weakness in the economy, with HSBC’s purchasing managers’ index showing factory activity shrank at its fastest pace in seven months in June and new export orders skidding to depths last seen in March 2009.

China’s central bank cut interest rates for the second time in a matter of weeks, stepping up efforts to bolster an economy that last quarter probably suffered its weakest growth since the global financial crisis. The People’s Bank of China (PBoC) also gave banks more leeway to set lending rates in a move analysts said was aimed at stimulating borrowing by creating a more competitive landscape. China cut its benchmark rates as both the Bank of England and the European Central Bank eased monetary policy, raising speculation that global policymakers had coordinated their action to lift a world economy buffeted by Europe’s debt crisis.

Underlining Beijing’s unease, the central bank’s last rate cut was just one month ago.

EUROPE

The European Central Bank (ECB) has reduced its key interest rate from one per cent to 0.75 per cent, a record low for the Euro Zone. The move comes as the Euro Zone economy continues to be weak. The ECB also cut its deposit rate, from 0.25 per cent to zero. The cuts coincide with action from other major central banks on Thursday, with the Bank of England adding another 50 billion pound in stimulus money and the Bank of China cutting its key interest rates. A cut in the ECB’s deposit rate is designed to stimulate lending between banks, as funds placed with commercial banks overnight are currently receiving 0.3 per cent in interest. Surveys released ear-lier this week indicated that the Euro Zone’s service sector had continued to shrink in June and that business confidence had fallen.

The European parliament threw out a controversial global pact to battle counterfeiting and online piracy, quashing any European Union (EU) ratification and possibly killing it for good. Twenty-two of the 27 EU states as well as other countries, including the United States and Japan, signed the Anti-Counterfeiting Trade Agreement (ACTA) in January but the treaty has yet to be ratified anywhere amid protests that it would curtail internet freedom. The parliament ignored European Commission pleas that the treaty was needed to protect the

economic interests of companies hit by counterfeiting and online piracy. Members voted by 478 to 39 against the pact, with 165 abstentions, ignoring a last-minute call by conservatives for them to wait until the European Court rules on its conformity with EU law.

INDIA

Nearly a month after Infosys said it had delayed its fresher on-boarding plan, instability in the economic environment and a possible slowdown in client spending have forced another IT services firm to postpone its fresher joining dates. California-headquarter iGate, which has a majority of its staff in India and employs around 30,000 people, said out of the 3,000 campus offers it made across India, joining dates of around 1,000 engineers will be delayed by one, or possibly, two quarters. “Close to 1,000 freshers, who were expected to join in July to August, will now join by the end of September or October,” said Srinivas Kandula, human resource head at iGate. “If the economic situation worsens, we will have to delay it by another quarter,” he said.

Agriculture Minister Sharad Pawar said, “Poor monsoon rainfall in June in key growing areas could affect pulses output in 2012-13, though rice production is unlikely to be affected.” India, the world’s second biggest producer of rice, cotton and sugar,

received 30 per cent less rains than normal since the beginning of the monsoon season on June 1. Monsoon rains are crucial for farm

output and economic growth, as about half of India’s arable land is rain-fed. The agriculture sector accounts for about 15 per cent of a nearly USD two trillion economy, Asia’s third-biggest, where good harvests are crucial to maintain rural incomes and thereby keep up the demand for gold and consumer goods.

JAPAN

Japan’s government could run out of money by the end of October, halting all state spending including salaries, pensions and

unemployment benefits, because of a standoff in parliament that has blocked a bill to finance the deficit. The deficit financing bill, which would allow the government to sell bonds needed to fund almost half of the budget, has languished in parliament as the ruling Democratic Party tussles with opposition parties that can use their control of the upper house to reject legislation.” Without this bill, the budget will collapse,” Finance Minister Jun Azumi said on Friday, pleading for cooperation from the two largest opposition parties. “It doesn’t matter which party is in power. I really hope that we can get a multi-partisan agreement on the deficit bill,” added Azumi.

The Bank of Japan (BoJ) upgraded its assessment for all nine regions of the economy for the first time in nearly three years as robust private consumption and spending on rebuilding from last year’s earthquake underpinned growth. The move underscored the view that the BoJ will keep monetary settings unchanged next week, barring any fresh bout of volatility in global financial markets. BoJ Governor Masaaki

Shirakawa warned that Europe’s debt crisis remained the biggest risk to Japan’s economy and could potentially affect its financial

system, signalling readiness to act if any market turmoil threatens the fragile recovery. But he stuck to the BoJ view that the world’s third-largest economy is on the mend as exports and factory output pick up, suggesting that the central bank sees little need to offer the economy additional stimulus for now.

Japanese Prime Minister, Yoshihiko Noda told International Monetary Fund Managing Director, Christine Lagarde that Europe’s debt problems are hurting the Japanese economy by causing rises in the yen that do not reflect its fundamentals. “Market jitters on Euro

Zone problems, especially one-sided yen rises that do not reflect Japan’s economic fundamentals, are inflicting severe damage on economic sentiment,” Noda said in a meeting with Lagarde, who is visiting Tokyo, according to a statement issued by Japan’s Finance Ministry.

MALAYSIA

Teraju and SME Bank have launched a 500 million ringgit Islamic loan facility called TeraS Fund targeted at high performing

bumiputera companies under the TeraS programme. Minister in the Prime Minister’s Department, Tan Sri Nor Mohamed Yakcop said that Teraju would contribute five million ringgit as risk capital to the fund, with the balance to come from SME Bank. In a separate development, he announced that part of the two billion ringgit facilitation fund for infrastructure projects introduced by Teraju and UKAS last year would be made more flexible. The threshold for companies applying for project finance would be lowered to five million ringgit from 20 million ringgit for a 600 million ringgit portion of the total fund.

Fitters Group has secured a USD 3.87 million contract with United Kingdom Indonesia Plantations (UKINDO) for its green mill

project. It said its unit Future NRG would supply and commission the equipment for the dried long fibre (DLF) and biogas power generation plants at UKINDO’s palm oil mill located at Blankahan, Sumatra. Fitters said FNRG would provide management services to UKINDO for the project at the Blankahan palm oil mill. It added FNRG would have the exclusive rights to off-take any and all DLF end-products produced at the Blankahan palm oil mill. FNRG would also off-take the products, ranging from 9,000 tonnes to 10,000 tonnes.

PAKISTAN

Pak Datacom Limited (PDL) — a leading information communication technology solution provider recently became a hot topic in the industry after its board of directors terminated their Managing Director and CEO, Salman Elahi Malik on at least three occasions in less than a month. The PDL board removed Malik on charges of forgery and acting beyond his authority. However, an independent investigation by The Express Tribune reveals a serious controversy behind Malik’s termination. It found strong evidence that Farooq Ahmed Awan, federal secretary at Ministry of IT and Telecom, went out of his way to remove Malik for not obeying his diktats.

The board of directors of the Faisalabad Electric Supply Company (Fesco) has approved development work for upgrading the power system with assistance from the Asian Development Bank (ADB), which has lent money for the purpose. Participants of a board meeting disclosed that ADB has given USD 23.29 million for the first phase and USD 19.23 million for the second phase of the development work. Under the programme, various grid stations and transmission lines will be upgraded to ensure uninterrupted electricity supply to agricultural, industrial, commercial and domestic consumers.

RUSSIA

Russian state holding company Rosneftegaz may buy a blocking stake in hydroelectric giant Rushydro, a source close to the deal said — a sign that the company will take part in the state’s privatisation plans. President Vladimir Putin said in May that Rosneftegaz — which holds stakes in Gazprom and oil major Rosneft — could take part in auctions of state energy and power companies to prevent them being sold to the private sector on the cheap. His comments left investors scratching their heads about the nature of Putin’s strategy on privatisation, which was originally intended to attract foreign investment and expertise as well as line state coffers.

Norway’s Telenor has complied with Russian law in its efforts to control Russia’s number three mobile operators, Vimpelcom, a Telenor executive said in an interview on Thursday. Telenor boosted its voting stake in Vimpelcom to 36.36 per cent in mid-February, taking back partial control of the company from Altimo, the telecoms arm of Mikhail Fridman’s Alfa-Group, with which it has fought years-long corporate battle. The move triggered a wave of hostilities with Altimo and prompted Vimpelcom to defer dividend payments. Russia’s anti-monopoly body, the FAS, filed a lawsuit in Moscow in April arguing the deal violated Russia’s Strategic Investment Law. The FAS said last month that it was pushing for an out-of-court settlement between the shareholders of Vimpelcom.

THAILAND

Charoen Pokphand (CP) Group, Thailand’s largest agribusiness conglomerate, is keen to acquire several foreign firms, including a possible investment in Smithfield Foods of the US and the French retail giant Carrefour. Chairman Dhanin Chearavanont said the economic downturn in Europe and the US has depressed share prices for many companies to levels very attractive for outside investors. “The share prices of stocks in the European markets are cheaper than in the past,” he told a forum hosted by Prachachart Turakij newspaper. Chearavanont said the Euro Zone crisis is far from over, and weak economic conditions in Europe have opened the door for financially strong Asian companies to expand on the continent. He played down whether a European acquisition will be completed soon; saying time is needed for feasibility studies.

Second-ranked mobile operator Total Access Communication (DTAC) plans to spend 800 million baht to redo its service

centres. The makeover is intended to prepare the company for intense third-generation (3G) wireless broadband services competition. Chaiyod Chirabowornkul, the chief customer officer, said the move is also aimed at capitalising on the rapid growth in smartphone and tablet sales. “The renovated shops are expected to address changing consumer behaviour, as they use more mobile data thanks to the proliferation of smartphones and tablets,” he said. Under the new service and sales integration concept, half the shop space will be designated for sales demonstrations to educate users about new devices and data packages.

Tourism operators have called on the government to clarify policies and measures aimed at achieving the target of boosting industry revenues to two trillion baht per year in 2015. Tourism revenue was estimated at 1.14 trillion baht last year. Business operators attending a workshop chaired by Prime Minister Yingluck Shinawatra said the government must be clear about what it plans to do to reach the target. Authorities estimate average spending by tourists will rise to 4,979 baht a day in 2015, up from 4,096 baht last year. In 2015, some 28.6 million foreign visitors are expected, with an average stay of 10 nights.

USA

An ugly first week for Microsoft Corp’s new financial year, probably its most important to date, has done little to inspire confidence that the software giant can jumpstart a stubbornly stagnant share price. The world’s largest software company, whose stock remains mired around USD 30, had prepared a multi-pronged assault to try and break into the crucial mobile computing space this year and take Apple Inc and Google Inc down a peg. But on Monday, it announced a USD 6.2 billion write-down of a 2007 internet-advertising acquisition — a reminder that Microsoft has a patchy track record when it ventures outside of its Windows and Office comfort zone. Days later, Vanity Fair blamed Steve Ballmer’s ‘astonishingly foolish’ leadership for a ‘lost decade’, in one of the most scathing articles ever written about the CEO.

A US judge has ordered JPMorgan Chase & Co to explain why the court should not force the bank to turn over 25 internal e-mails demanded as part of an investigation into whether it manipulated electricity markets in California and the Midwest. The Federal

Energy Regulatory Commission (FERC) filed a petition in federal court in Washington on Monday asking the court to order the bank to show cause as to why it would not comply with a subpoena issued by the commission as part of its investigation into the bank’s power trading. On Thursday, US District Judge Colleen Kollar-Kotelly gave the bank until July 13 to submit an explanation as to why the court should not enforce FERC’s subpoenas. JPMorgan has asserted the e-mails are protected by the attorney-client privilege.A VIP mortgage programme run by now-defunct Countrywide Financial Corp was used to influence lawmakers with the aim of killing legislation that could hurt the

company’s profits, a congressional report released on Thursday said. The report from the House of Representatives’ Oversight and Government Reform Committee provided new details about the programme, which offered discount loans to VIPs and it named dozens of congressional staffers that benefited. The company, which was once the biggest US mortgage lender, granted hundreds of loans between 1991 and 2008 through the VIP programme, the report said. Recipients included lawmakers, their staff, top government officials and executives of government-controlled mortgage company Fannie Mae, according to the report.