Shares up as India market reopens

The stock exchange of India has reopened after it was closed on Thursday because off the attacks in Mumbai, the business capital of India. The benchmark Sensex has rising with 0.7% wich is not bad for what's happend in Mumbai.
The attacks have a little impact on the other Asian markets, most of them have rising, but have brought many companies in problems on short-time. Some companies have to cancell al their meetings and conferences which means that they couldn't be working like they would and maybe have had losses. But people say that the businness in Indai wille be normal again, they haven't got a choice, people have to have food, companies have to produce,...
Like many other countries, India has sufferd from the global credit crunch, plenty off foreign investors have already pulled their money from the Indiane markets. But their are also companies who said that, due to the attacks, they will be no changes in their long-term investments.
Indian economists said that India will always be popular for foreign investors because they can give them what others countries can offer. The predictions for the future are good. The growth rate for example will be 9% in 2009.

I think that India will be in problems if the attacks will last on will go further through the country. When I for example will be an investor and i have had money in India I would immediatly pull off the markets. Because off the attacks the companies can produce what they produce normal conditions. And also becausse off the global credit crunch, I think that India has no good papers for the future despite off the good growth rate of 2009.
Also I think that new foreign investors will put their money on markets that are more stable than the Indian market.

source: http://news.bbc.co.uk/2/hi/business/7753843.stm

China sets a green standard

American environmentalists are pleased with the efforts that China is doing to green its financial sector. The environmentalists even say that regulators in the United States could learn from the recent success that China achieved by stimulating investments that don’t despoil the world.

In a recent Chinese report we could see a very positive and remarkable highlight! The Chinese financial sector does now even have policies to limit the pollution and climate change. There is a regulation that says that Chinese banks may not lend money to companies that aren’t in compliance with the environmental laws. For example we could take the industrial and commercial bank of China. They reduced their loans to polluting industries by 24%!

There’s even a Ministry of Environmental Protection created. So far, there are already 38 firms consigned on a credit blacklist. This because of their environmental violations. In figures we could say that there is already a $293 million in loans is denied or recalled because of environmental violations.

I think that the Chinese government is on a very good way with the efforts that they are doing to green its financial sector! It’s very important that we all think about the environment because we have to think about the next generations. If we keep polluting like we are now doing, there will be a big problem. So I think that it’s very important to stimulate and reward companies who are trying to produce in a less polluting way.


source: http://www.atimes.com/atimes/China_Business/JK25Cb01.html

Japanese production falls sharply

The Japanese production and consumer spending have fallen sharply what indicates that the country is heading for a serious and prolonged recession.
The industrial production fell by 3.1% and the consumer spending by 3.8% in October compared with previous month. Both a lot faster than analysts predicted. That resulted in companies adjusting their production very quickly to reflect the lowered demand. Car makers are the ones that are hit the worst. But other sectors also start suffering, steelmakers for example.
Analysts are now forecasting a drop in industrial production of 8.6% for the fourth quarter. Early figures already showed that the Japanese exports fell by 7.7% and the Yen climbed stronger than ever against the Dollar. This is very bad because the Japanese production is very reliant on export to other industrial countries who all have been hit by the global crisis.

The recession is something the Japanese government will have to fight against by taking measurements that will help both the companies and the consumers. And it’s their duty to preserve the current level of prosperity by minimizing the negative effects. But on a general view I think the Japanese economy will have to endure this difficult period and they can only hope it will get better soon.


Source: http://news.bbc.co.uk/2/hi/business/7754159.stm

China fears unrest amid slowdown

The Chinese economy is slowing down and this has big consequences. Unemployment rises and this could lead to social unrest. So the impact of the global crisis on the Chinese economy is also very big. Unemployment caused by productions cuts are not the only consequence, many companies are going bankrupt.
The export is slowing down and the property market is in a state of crisis and that is also one of the reasons why China had a negative growth, but they have good forecast for the future and they try to keep the people calm, but this is not easy. Already there were protests by fired workers.
The government and the central bank had to take measurements to slow down a further diminution. One of these measurements is lowering interest rates from 6.66% to 5.58%. This cost a lot for the government but it’s necessary to stabilize the Chinese economy.
It’s not the fault of the Chinese government that the economy is not doing well but I think the government and the central bank need to do more than lowering interest rates. They should help companies who are not doing well. Lowering taxes is also a good idea, because they can attract new investors .

Source: http://news.bbc.co.uk/2/hi/business/7753020.stm

Pakistan asks IMF for rescue loan

Like the titel says, Pakistan has asked for help from the Intenational Monetary Fund. It's the last chance for Pakistan to help their economy. With this loan, Pakistan can stabilise their economy and it needs the money to avoid a recession in the country. Befoe asking a loan to the IMF, Pakistan has search for other sources to find a loan but they failed to find a deal.
Also Pakistan suffers with the consequences of the international economical crisis.
Because off the rise in international prices of food and oil, the Pakistani rupee has falling down so a lot of the capital of the government has no value anymore. Pakistan is also a country which imports a lot and because off the drop of the Pakistani rupee, they have the pay a lot for their products compairing with other countries.

The IMF helps the countries who are in troubles but they have strict conditions for repaying the loan and that can also create problems.

The IMF has said that they will help other countries who have problems like Pakistan.

I found it great of the IMF that they will help countries like Pakistan.
With the help of the IMF the countries can hopefully face the crisis and help their economy.
But I think that the countries will be in problems when the moment has there to repaying their loan. When the moment is there, there economy will be good but I think they will no have the money to repaying their loan. So I hope for Pakistan and al the other countries with problems that they will have a good economy in the future with or without the help of the IMF.

source: http://news.bbc.co.uk/2/hi/south_asia/7730943.stm

Time to catch breath

The IMF, International Monetary Fund, forecasts simultaneous recessions for Japan, Europe, and North America for the first time since 1945. This might explain why the Asian markets had a very volatile week.For example we can take the KOSPI, the South Korean benchmark. It was swinging 16.1% from its Wednesday high to its Friday low. But at the end of the week it was the region’s second biggest gainer, which was positive.Although up only the very poor 1.9% on the week following recent disastrous declines which is in response to the country's central bank who slashes interest rates for the third time in a month. The central bank is doing this to avoid a big recession.

As we take a look at the whole Asian market, we can see that there has been a very volatile week in every country. So it’s not only South Korea who has suffered from the volatility.

I think that it’s quite normal that there has been such a volatility lately on the Asian market. This is so because of the forcasting of the International Monetary Fund. If the IMF didn’t forcast recessions, there probably wouldn’t be so much volatilities on several, not only the Asian, markets.

source: http://www.atimes.com/atimes/Asian_Economy/JK08Dk01.html

Daewoo leases African plantation

The South-Korean company Daewoo has announced that they want to plant corn on the fertile land of Madagascar to decrease their dependence of US import.
The land that Daewoo leases for the next 99 years is about half the size of Belgium. They hope to produce more than 5 million tons of corn each year.

They will use local workers and farming techniques from South Africa. Other countries that have a lack of arable land such as Saudi Arabia and Kuwait have also been seeking for agriculture investments in Africa or Asia. The African governments are very pleased with this. Angola and Ethiopia both declared they are willing to offer farmland to those rich investors.

This idea has his positive and negative sides. One of the downsides I come up with is the fact that if they exploit the farmland on a very intensive way they land will become infertile and the Africans end up with another piece of desert that is not suited for any form of farming. But on a general view I think it’s a good thing that the Asian and Arabic investors create a lot of job opportunities for the poor African people. We can only hope that they pay the workers a decent wage and that those initiatives bring prosperity and welfare to the poorer regions of the world.

Source: http://news.bbc.co.uk/2/hi/business/7737643.stm

India turns up energy diplomacy

India wants to secure Energy resources and export markets to maintain its economical growth. This is the reason why the government is visiting Russia and Japan. These countries want to deepen ongoing Energy projects while seeking new leverages.

Indian and Russian companies can develop in each other’s country . The Indian government looks forward to the investment of new Russian refineries and petrochemical developments in their country. Indian companies want also to be involved in projects in Russia. To arrange this all, representatives of the two government came together to discuss this all. These transaction have no consequences for the local people, but the amount of the transaction is very big and that why the two government have to make good arranges, so that everybody is satisfied afterwards.

The Indian government wants also to import 2 million tonnes of liquefied natural gas (LNG) a year from the Sakhalin LNG project. LNG is the biggest gas importer in India, it belongs to the Gazprom group and they want to sell LNG to India. This would make the connections between the two countries bigger and would help India to keep its economical growth. It’s a big investment for the Indian government but they have to look in the future, it’s a good investment for the future.
But they have to use these natural resources very wisely and make sure that they don't wear out these source.

Source: http://www.atimes.com/atimes/South_Asia/JK22Df04.html

Korean Air suffers profits fall

Korean Air has booked another quarterly loss. The airline is hit by the bad position of the South Korean currency and the high fuel costs. Because of the weak won, which is the currency of South Korea, it's more difficult for the airline to buy fuel. The fuel is priced in dollars so they have to pay more when they change won into dollars.

The biggest problem for the airline is the bad position of the South Korean won. It is one of the worst currencies that have performed so badly, the currency dropped about 30% compairing with the dollar. Thanks to that, the price that the airline has to pay for their fuel is very very high.

It's one of the biggest cargo carriers in the world and the management fears that after the falling demand of tickets from people, the cargo demands also will go down.

What do I have to say about it, it's an international problem. Korea has the disadvantage that their currency isnt so good but it's not only in Korea that the economy is bad. I found that the governement has to something, if they can do something of course, about the bad economy and especially about their weak currency.
Maybe the IMF can help the countries with the worst economy or currency. I hope that the economical crisis will stop soon.

source: http://news.bbc.co.uk/2/hi/business/7730064.stm

North Korea stokes another crisis

The relationship between North and South Korea is not so well. But now North Korea is testing the will of South Korea’s president, Lee Myung-bak, while they are looking forward to a very good working relationship with the United States, now that Barack Obama has become the new president.

The North will take measures, geared to force South Korea’s conservative president towards softening his hardline stance on the North. That’s an optimistic scenario.

But there’s also a pessimistic scenario...
As the North is about to close their borders with the South and sets new conditions on inspections of their nuclear facilities, the militarist will control in North Korea at an extremely critical juncture. And also knowing that the leader in the North, Kim Jong-il, is too ill to rule the nation effectively.

North Korea is about to take action. They are about to close the border with South Korea from December 1. That measure will have big consequences... All the activity at the Kaesong industrial complex, where more then 80 South Korean companies employ 35,000 North Korean workers, will be suspended.

I believe that closing the border is not such a good measurement. I fear that if the border will be closed, there will become a rumour between the two countries. It’s understandable that North Korea will do everything to get a good working relationship with the United States, but they have to be realistic and see what other problems they may cause.



source: http://www.atimes.com/atimes/Korea/JK15Dg01.html

Why the next currency crisis won't be in Asia

Many countries are at the moment in a Financial crisis. The question is, is Asia the next victim of worldwide financial crisis. Countries like Hungary raised their interest , to avoid a bigger crisis. Higher interest rates are often the last resort before a currency crashes and a crisis start. These crisis are spreading over many countries and could also spread over Asia.
Already have certain countries like Indonesia, South Korea, the Philippines felt this. They had to devaluate their currency. These countries concluded that a crisis always start with a country that already has problems. That’s why they also took measurements like exchange reserves and better developed banking systems.
But Asia, just like all other regions, the currency can also fall. But Asia is prepared. They have the best underlying fundamentals of any region and that is why the Asian currencies will bounce back once the crisis is over.
I believe everything is possible in Asia. Some countries have already experienced a bit of the crisis, but they anticipate well. Their economies are still working fine and they are getting smarter by taken measurements. The problem of the Asian economy is that there isn’t a unity between the different countries of Asia. If Asia had this, they would have a strong economy, with many prospects for the future.

Source: http://www.moneyweek.com/investments/why-the-next-currency-crisis-wont-be-in-asia-13939.aspx

China startled by force of crisis

According to the Chinese premier Wen Jiabao the effects of the worldwide financial crisis on China is worse than they expected. It’s the first time the Chinese premier gives his own personal opinion about the crisis.
Compared to other countries, China’s grow rate is still high but their economical expansion is slowed down.
Not so long ago, China announced that they would slow down their economy to protect it against global recession.
In Southern China for example multiple factories had to close which caused unemployment for a lot of migrated workers.
China’s biggest fear is that the social problems caused by the cool down will lead to instability and unrest.
To offset the results of the measurements the Chinese Central Bank has declared they will cut in the interest rates to boost their economy and a 10 point stimulus plan has to persuade Chinese consumers to spend more.
In my opinion the Chinese government did well by closing the factories and thereby avoiding much worse to happen. Now the government has taken actions to stimulate the economy again those unemployed workers will soon get back to work again. If the government shouldn’t have intervened on time it could have ended in a social massacre.

http://news.bbc.co.uk/2/hi/asia-pacific/7727237.stm

Australia lowers rates to 5.25%

The Austrialian Central Bank has reduced his main interest rate from 6% to 5.25%. With this drop of the interest, the Central Bank of Australia hopes to give a boost to the economy and to avoid a recession.
The reduction to 5.25% was larger than expected but analysts say they had predicted a reduction.
It was the third cut in three months of the Reserve Bank. Thanks to this reduction, the key interest rate of Australia has become the lowest since March 2005. Some experts says that this reduction is a good stimulus for families and the industry to face the world credit crisis. It will give the economy the power to move on in these bad times. It is not only Australian Central Bank who made a reduction, most of the Centrals banks around the world did it.

I think the Australian Central Bank did a good job by reducing the interest rate. With this reduction they help the people and the industry. Which will lead to a better economy. And if a country has a good economy, everybody can enjoy of the advantages of a good economy. So to conclude I would say that the Australian Central Banks has done a good job by reducing the interest rate.

source: http://news.bbc.co.uk/2/hi/business/7707579.stm

India approves insurance overhaul

The Indian government has approved a new bill that allows foreign investors to take a bigger participation in domestic insurance companies then before. From 26 percent to 49 percent. Only the communist party opposed against this proposition and cancelled its support to the government. Multinational insurers would then be free to move into a market from which twenty percent of the population are uninsured. They are very eager to explore this rapidly growing, developing market where almost nine on ten workers doesn’t even have a pension scheme.
The Indian government also hopes that the easier ownership for foreigners will also attract the much needed capital that can feed the growing economy because insures would be able to pull 12 billion dollar from the Indian markets.
In my opinion this is a very wise decision of the Indian government to allow foreign investors because the Indian people also have the right to insure themselves. And now the market soon will be opened for globalization they will be able to have a bigger choice to select insurances and most likely also a better price to buy one. This is a good step towards a better society because the insurances will give the Indian people a safer and better life.

Source: http://news.bbc.co.uk/2/hi/business/7702207.stm

Japanese Inflation Has Begun It's Steady Path Downwards, Economists Say

The Japanese core inflation fell and will continue to do so in the near future, that is what several economist think. Now the bank of Japan has to consider different measurements against the declining inflation by adapting their monetary policy. Several economists fear that the bank of Japan will cut rates now the inflation is stagnating.

Economist, Davy Cohen, said that the steady inflation is an effect of the falling energy prices all over the world.
Matt Robinson, an economist with Moody’s economy.com, agreed with that point of view and he even thinks that this is the beginning of a downward trend in national inflation.
On the other hand, Robinson says that core-core inflation, prices shed of both energy and food prices, are not about to go downwards. "This suggests the spike in food and energy prices may have already become entrenched in broader price pressures," he said.
This might be a reason for the bank of Japan to limit their enthusiasm to cut rates.

Davy Cohen, an other economist, disagrees. He thinks that the falling inflation will be seen as an opportunity to cut rate, what would not be very good for the economy of the country.

I think that the bank of Japan will be enthusiast to cut rates now the core inflation is stagnating, which I think is logical. But unfortunately that wouldn't be a good measurement for the people but I'm afraid that the bank Of Japan will cut rates.

source: http://www.actionforex.com/latest-news/asian-economy/japanese-inflation-has-begun-it%27s-steady-path-downwards

Myanmar's farmers pay for China's oil thirst

China wants to expand its oil fields to Myanmar. The farmers of Myanmar are the victims of this new plan of China. The south Island ( Ramree) with 400 000 inhabitants has a lot of oil and gas under the ground.
The Chinese Oil company has already destroyed rice fields and plantations when they conducted seismic surveys and mined the island in search of oilfields. This caused hundreds of people their houses and they were forced to relocate. The oil company has never consulted the local people and the company has never took its corporate social responsibility.
They also polluted the local nature. To dump their waste, they dig shallow canals to carry the toxic drilling mud. away from the drilling site, but right into the Chaing Wa Creek. This creek passes several local farms.
China is using Myanmar in search of oil and gas. There are no advantages for Myanmar. The local people have to move, what isn’t fair for them. The profit of the oil is not going to the people of Myanmar, but right into the pockets of the Chinese owners. And they pollute a lot and don’t take their responsibility. The government of Myanmar made also profit on the sale of gas to Thailand, but like the Chinese Oil company, the government did with the money nothing for the local people.

Source : http://www.atimes.com/atimes/Southeast_Asia/JK04Ae01.html