Wednesday, December 9, 2009
Saturday, November 28, 2009
Thursday, November 26, 2009
Wednesday, November 25, 2009
Sunday, November 22, 2009
Friday, November 20, 2009
Wednesday, November 18, 2009
Monday, November 9, 2009
Monday, September 21, 2009
Wednesday, July 1, 2009
Friday, May 29, 2009
KUALA LUMPUR — Malaysia’s economy shrank a worse-than-expected 6.2% in the first quarter from a year earlier because of a steep fall in exports and manufacturing, data released Wednesday showed.
Central bank Gov. Zeti Akhtar Aziz said economic conditions remain tough, and the economy is likely to register a similar performance in the current quarter.
The first-quarter contraction is the country’s first in nearly eight years and the worst since the fourth quarter of 1998 when GDP fell 11.2% from the previous year. It was more severe than the median 4% forecast by 18 economists polled by Dow Jones Newswires, and reverses the 0.1% growth eked out in the fourth quarter of 2008.
“We are now going into the third month of the second quarter; from what we have seen, export demand continues to be weak and economic conditions are still challenging despite early signs of an improvement,” Ms. Zeti said. Second-quarter gross domestic product “will be similar to the first quarter.”
Economic conditions, however, are expected to improve in the second half of 2009, supported by the government’s fiscal-stimulus measures and Bank Negara Malaysia’s efforts to increase financing for the private sector, Ms. Zeti said.
“Though Malaysia’s first-quarter GDP was worse than expected, it is not out of line with patterns in the region,” said David Cohen, an economist at Action Economics in Singapore.
For 2009, the current GDP forecast is a range of between a 1% contraction and a 1% expansion, but Second Finance Minister Ahmad Husni Hanadzlah said Tuesday that it “will definitely be below minus 1%.”
Prime Minister Najib Razak will announce a revision to the full-year GDP forecast on Thursday. Economists polled by Dow Jones Newswires predict a median contraction of 1.6% for 2009.
Sunday, April 26, 2009
The International Monetary Fund has failed to provide the blueprint for pushing global finance and governance toward healthy conditions.
There appears to be a deepening disagreement among finance ministers attending the IMF spring meeting on Sunday over how and when to abandon recession-busting policies by the world financial body.
The IMF's managing director, Dominique Strauss-Kahn
Ministers were also unable to finalize a USD 500b boost to the IMF's resources put forward earlier this month by the Group of 20 (G20) Summit in London. Dominique Strauss-Kahn, the IMF's managing director, said there were already differences among members over 'an exit strategy'. Strauss-Kahn said there was consensus about the need to borrow more during the crisis: "Some of us, including the IMF, are arguing that the stimulus is necessary, but at the same time, you need to have a view about what is going to happen in three years' or four years' time, and prepare the exit strategy from the stimulus.
" Some blame the disagreement among finance ministers on the restructuring plan the United States has proposed for the IMF. The Europeans are especially resistant to such radical changes. Rejecting the call by the US treasury secretary Timothy Geithner to cut the number of IMF seats from 24 to 20, by 2012, Belgian finance minister Didier Reynders endorsed the current number of seats. "I think that for the moment the representation around the table is attractive.
The European countries are having to finance the Fund very strongly so we have to take into account the size of each country's participation in the Fund," Reynders noted. The IMF warned this week that the world economy would contract this year for the first time since the World War II.
Tuesday, April 14, 2009
BEIJING, April 14 – Wall Street Journal
China’s $585 billion government stimulus programme appears to be kicking in, new data suggest, raising the chances that the world’s third-largest economy may be turning a corner.
Chinese demand for raw materials, hard hit in past months, is showing signs of recovery. Crude-oil imports hit a one-year high in March, the government reported Friday. Steel mills in March imported record quantities of their key raw material, iron ore, in anticipation of a pickup in demand in coming months.
Banks have extended a stunning 4.58 trillion yuan, or about $670 billion, of new loans in the first three months of the year, according to data published Saturday – nearly as much as the 4.9 trillion yuan issued in all of 2008. And the stock market, which had been battered, is on the rise, with the Shanghai composite stock index gaining 2.8 per cent on Monday, pushing it to a 38 per cent increase for the year to date.
The signs augur well for the global economy. China has been one of the world’s most voracious consumers of raw materials. While its aggressive spending plan reflects the power of its state-dominated economy, there are signs that its thrifty consumers are starting to spend more.
Car sales hit a monthly record in March, according to figures issued Thursday, marking the third consecutive monthly rise. Housing sales in major cities have also picked up, with lower prices attracting buyers.
The optimistic outlook has spread to businesses. The National Bureau of Statistics said last week that its survey of managers’ confidence rose in the first quarter after plunging in the final quarter of 2008.
Overall, it appears that the state’s push has helped keep China from slipping into a downward spiral in which poor economic conditions and declining confidence feed off each other. The size of China’s stimulus, announced in November, gets some credit for that: Along with the US plan, it is one of the largest in the world. But the vestiges of China’s command economy have also proved useful.
“China is unusual in that it has this incredible capacity to mobilise all its institutions,” said Vikram Nehru, the World Bank’s chief economist for Asia. The government’s ability to direct bank lending and investment spending has meant its stimulus efforts have worked faster than many initially expected.
“There is now a growing degree of confidence that the stimulus package is having an impact,” he added.
Beijing’s programme still has considerable work to do, with new data also charting continued contraction in the country’s export sector. The global slump in demand has battered exporters, leading to millions of lost jobs.
Exports fell 17.1 per cent in March from a year earlier, after a 25.7 per cent decline in February, official data showed Friday, a reflection of China’s vulnerability to weak economies in the US and other export markets. That left a trade surplus of $18.56 billion for the month, far higher than February’s figure but less than half the levels recorded late last year.
That is also being reflected in slower accumulation of foreign exchange reserves. New data from the central bank, released Saturday, showed the dollar value of reserves fell in January and February before picking up in March. They ended the quarter at $1.9537 trillion, compared with $1.946 trillion at the end of December.
Analysts say swings in the currency market also affected the headline figure for the reserves, which are held in multiple currencies but reported in US dollars.
But the government is pushing cash through the economy, and the state investment programme is driving new infrastructure projects.
Funds budgeted for investments that started in the first two months of 2009 surged 88 per cent from a year earlier.
While improvement in China alone isn’t enough to reverse the global economic decline, it is still welcome news, given that China is one of the few major nations that is expanding.
Like China, the US government also has launched a significant fiscal stimulus, of $787 billion, the impact of which is only now beginning to show up in the economy as tax cuts swell worker paychecks.
US consumers – their retirement accounts and home values depressed – are showing a reluctance to spend as readily as they usually do. Car sales in the US, in contrast to the records being set in China, are extremely low. Spending on infrastructure is taking awhile to kick in, despite talk of “shovel-ready projects.”
Weaknesses in US banks and, even more, the near-paralysis of the important market for securitised credit, remain major impediments to renewed economic growth.
China needs support from demand in the rest of the world to sustain a recovery. Without that, it is still unclear whether China’s economic engine, having been jump-started by government investment, can keep running in a higher gear.
Export manufacturing remains the primary employer of China’s 140 million rural migrant workers. About 20 million of them are unemployed, and if the export crunch continues for several more months, that could exhaust their meagre savings.
Key to the effectiveness of China’s stimulus plan so far has been a race by local governments to spend the money.
After November’s stimulus programme gave them the go-ahead, authorities in the northern city of Harbin started expanding their port in March. The provincial government is trying to launch even more ambitious port works by October.
“Thanks to the stimulus plan, our proposed projects get a lot of support from the central government,” one official in Harbin said.
In central China, state-owned Henan Coal & Chemical Industry Group started work on 15 expansion projects on April 1, declaring its planned spending of 22.4 billion yuan a response to the government’s call to maintain 8 per cent growth this year.
That kind of reaction is partly why many analysts expect first-quarter economic data – to be released this week – to show activity picking up relative to the fourth quarter of 2008, even if headline growth rates remain very low by Chinese standards. The World Bank expects China’s economy to expand 6.5 per cent this year.
“I think it’s fair to say the economy has bottomed. But bottoming is not recovery,” said Ben Simpfendorfer, an economist at Royal Bank of Scotland.
Among the reasons for economists’ caution before calling a recovery is that China has had at least one false dawn in recent months. In early anticipation of stimulus-related orders, domestic steelmakers started ramping up production in December and January, helping to push up prices and freight rates.
But the anticipated demand didn’t materialise, and steel prices have been mostly falling since February.
The stimulus gets credit, at least, for stemming panic. Peter Li, chief financial officer of HLS Systems International Inc., a Beijing-based maker of industrial automation products, says he is getting orders from railroad projects as part of the stimulus plan.
“People are not in as much of a rush to sell inventory. They don’t expect prices to go down,” Li said. “The biggest impact of the stimulus plan so far is really on the psychological level.”
Sunday, April 12, 2009
Swiss bank Credit Suisse has started closing down the offshore accounts of US clients who have not declared the money to the US authorities, a newspaper reported today.
The Sonntagszeitung newspaper said the bank had about 2,500-5,000 US clients with undeclared offshore accounts worth about 3 billion Swiss francs (RM27.9 billion), without citing its sources.
The paper said Credit Suisse had started parting company with its US offshore clients, giving them the option of moving their accounts to its CS Private Advisors subsidiary, which would report the accounts to the US tax authorities, or writing them a check.
It quoted an unnamed Credit Suisse manager as saying the bank was only applying the new “zero tolerance” policy in individual cases for now but was considering a more general withdrawal from the US offshore business.
Credit Suisse was not immediately available for comment on the article. Sonntagszeitung quoted a spokesman as declining to confirm the report, but noting the tougher approach of foreign authorities on offshore wealth management in recent times.
“CS sticks to all valid rules and regulations in various countries,” a spokesman told the newspaper.
The move comes after rival UBS said last year it would stop offering offshore services to US citizens after US authorities alleged that the Swiss bank has helped rich Americans hide money away from the taxman in Swiss accounts.
A newspaper reported earlier this year that Credit Suisse was writing to its US clients holding Swiss accounts asking them to sign a form that would reveal them to US tax authorities.
Thursday, April 9, 2009
Sunday, April 5, 2009
Bolivian President Evo Morales
Morales said that countries at the root of the crisis cannot solve the problem, or in his words: "the wolf cannot keep the flock," a reference to the injection of more than 1,000 billion dollars through the IMF and the World Bank to fight the global crisis.
"It's like giving money to the wolves, or to entrust the care of the flock: the wolf is not going to keep the sheep, it will devour them," Morales told the foreign press in La Paz, commenting on the decisions G20 in London to tackle the crisis.
"It is not possible that the countries of capitalism, which has caused the financial crisis, are now the same from where comes the solution," said the Socialist leader, adding that few countries are at the origin of this financial crisis, but '180 (Countries) must cope'.
"As long as we do not touch the structural points of capitalism, it will be difficult to resolve the financial crisis," said Morales about the G20. "If we want to solve economic problems, we must first end the free market, then the speculative capitalism."
Morales remarks echoed those of the Venezuelan President Hugo Chavez, who said earlier in the day that the G20 nations' plan to spend more than a trillion dollars would strengthen "one of the great guilty ones behind the crisis: the International Monetary Fund."
"It's impossible that capitalism can regulate the monster that is the world financial system... Capitalism needs to go down. It has to end," Chavez said during a visit to Tehran on Friday.
Bolivia is experiencing the beginning of economic deceleration with 5 percent growth at best in 2009, against 6.5 percent in 2008.
Friday, April 3, 2009
Over 5.1 million jobs have been lost since the beginning of recession in 2008
Tuesday, March 31, 2009
But the summit is attracting much anger, with large protests expected.
Barbara Serra reports from London.
Tens of thousands of people took to the streets of London in a peaceful march calling for changes to be made to the global financial system.
But events in Rome and Berlin were marred by some violence. Al Jazeera's Nazanine Moshiri reports.
Monday, March 30, 2009
Sunday, March 29, 2009
Saturday, March 28, 2009
Wednesday, March 25, 2009
HONG KONG, March 25 – reported by malaysianinsider – source : Reuters
China’s economy has touched bottom but further interest rate cuts remain an option, a Chinese central bank adviser said on Wednesday.
Fan Gang, who sits on the Chinese central bank’s monetary policy advisory committee, said a 25 per cent rise in car sales and accelerating investment in China indicated the economy was showing signs of improvement.
“Before (the economy) bottoms out, it has to bottom. I believe it has bottomed, with the stimulus package and signs of recovery in some industries,” Fan said in an interview during the Credit Suisse Asian Investment Conference in Hong Kong.
Steel and energy consumption were declining at a slower rate and may have turned positive in March, while the transportation sector was warming up, he said.
However, high inventories and overcapacity in some industries remained the biggest short-term challenges for the economy, he said.
Further interest rate cuts remained an option.
“I don’t think anybody would rule it out. But it depends on China’s liquidity, how China’s recovery takes place and how the stimulus package works out,” he said.
As exports have collapsed in the face of sharply declining global demand in recent months, high inventories and overcapacity in some industries posed the biggest short-term challenges for the Chinese economy, Fan said.
The Chinese government has targeted 8 per cent growth this year, its lowest growth since 1999, but the World Bank forecasts only a 6.5 per cent expansion.
Fan said China’s sharp economic slowdown meant deflation was an issue in the short term, but he warned that inflopment of a diversified and competitive monetary system would be useful because competition between currencies can create more discipline.”
Monday, March 23, 2009
KUALA LUMPUR, March 23 - Reported by Malaysianinsider - source : Bernama
The government has a huge liquidity of RM250 billion in its coffers to help local entrepreneurs cope with the current global economic crisis, Datuk Seri Najib Tun Razak said today.
The Deputy Prime Minister said the government would also provide incentives to encourage banks to issue loans to businessmen in need of financial aid such as providing repayment guarantees to banks to reduce the liability risk.
"So long the banking sector does not give out loans, until then efforts to stimulate the world economy will not succeed," he said. Among the incentives provided are credit guarantee scheme for small-time businessmen by the Credit Guarantee Corporation under the supervision of Bank Negara which will provide 80 per cent guarantees for loans approved under the scheme.
Sunday, March 22, 2009
In the last six months, Zambia's kwacha has plunged 30 percent against the US dollar, forcing a decline in export earnings and pushing foreign investment to almost zero.
The bank of Zambia has banned non-residents from borrowing kwacha in order to boost currency losses.
Zambian Trade, Commerce and Industry Minister Felix Mutati reiterated that there would be heavy penalties on business that uses foreign currencies especially the US dollar.
According to Mutati, introducing statutory instruments is aimed at ensuring business firms trade in Kwacha and that "the effects of dollarisation" are curbed.
Zambia's main industry comes from its copper resources which are the largest in Africa. However, the recent fall in world copper prices has taken a heavy toll on the Zambian economy.
The International Monetary Fund (IMF) says because of its dependence on copper, Zambia is "highly vulnerable to the adverse effects associated with the global recession."
Zambia now hopes to save its drowning economy with measures, such as using a $200-million loan from the IMF to boost its foreign currency reserves -- which have since August 2008 gone down by 40 percent -- and enforcing a one-year foreign currency ban.
Saturday, March 21, 2009
Friday, March 20, 2009
Thursday, March 19, 2009
Saturday, March 7, 2009
Chief executives of the US-based JPMorgan Chase and Co. and the British bank HSBC have been invited to the meeting, the report adds.
Mitsubishi UFJ Financial Group President Nobuo Kuroyanagi from Japan is also expected to attend the meeting.
The home mortgage meltdown in the American housing sector has resulted in big losses and massive write-downs among financial institutions in both the US and Europe.
The Federal Deposit Insurance Corp. said in late February that the US banking sector lost a combined $26.2 billion in the fourth quarter of 2008.
JPMorgan Chase has announced that it expects 12,000 job cuts as part of its takeover of the failed Washington Mutual retail bank.
Europe's biggest bank, HSBC, has also been hit by losses in the US sub-prime mortgage market. In North America, it has reported a loss of $15.5 billion.
HSBC announced in March that it was seeking to raise 12.5 billion pounds ($17.7 billion) from shareholders through a rights issue in Britain.
Sunday, March 1, 2009
Tuesday, January 27, 2009
In its latest report Israel's central bank said Tel Aviv's budget deficit would stand equal to about 4 percent of the gross domestic product. The bank says the economy is expected to fall by 0.2 percent in 2009.
The war, according to the bank, will widen the budget deficit to 4.1 percent of the GDP from 2.1 percent in 2008 and will also discourage tourism.
The bank revised its estimate from 1.5 percent growth for 2009, saying the economy will plunge this year for the first time since 2002.
"We are producing much less than we predicted and much less than in previous years," said Yosef Saadon, a spokesman for the Bank of Israel.
The Tel Aviv Stock Exchange's benchmark TA-25 Index shrank by 4.4 percent to 637.23 last week.
After the start of the war, economists warned that the Israeli economy would be threatened if the invasion of the Gaza Strip was prolonged or the scope widened.
The estimated daily cost of the military operations stood at tens of millions of shekels (dollars).
According to Israeli daily Haaretz, Israeli economists acknowledged that the costs of the attacks on Gaza would skyrocket if Tel Aviv called up large reserve forces or launched a ground attack.
The Israeli Defense Ministry declined comment.