Japan's output tumbles record 9.6%

Japan's output tumbles record 9.6%
31-01-2009

Japan sank deeper into recession with industrial output tumbling and inflation slipping to almost zero. Japan's industrial production fell a record 9.6 percent in December, while annual core inflation slowed to a mere 0.2 percent. Rising unemployment, slowing household spending and no improvement in the industrial outlook added to fears that Japan was flirting with deflation and would post a horror GDP figure in February if exports do not bail it out. "It is already a consensus view that core consumer inflation will turn negative soon, but we must watch if a worsening of the economy pushes Japan into a deflationary spiral even though the Bank of Japan sees no signs of that happening right now," said Tatsushi Shikano, senior economist at Mitsubishi UFJ Securities.

ATV confirms cash injection

ATV confirms cash injection
31-01-2009

The executive chairman of Asia Television, Linus Cheung, says the station is expecting a major cash injection of no less than HK$300 to HK$500 million from a 'new investor.' He would not confirm reports that the investor is Taiwanese billionaire, Tsai Eng-Meng, but described the deal as a vote of confidence in the troubled broadcaster.

More factories expected to close

More factories expected to close
31-01-2009

The Federation of Hong Kong Industries is expecting more Hong Kong-owned factories across the border to shut down in the next two months. Its vice chairman, Stanley Lau, said many factories had extended the Lunar New Year holiday to March and were planning to cut jobs. Factories on the mainland have been suffering due to slumping overseas demand for goods. But Mr Lau said orders should pick up later the year, as importers would need to replenish their inventories.

HK Better than expected budget surplus

HK Better than expected budget surplus
31-01-2009

The government has announced a budget surplus of almost HK$31-billion for the first nine months of the current financial year. This came on the back of a year-on-year rise of almost HK$75-billion in revenue from taxes and investment income. A government spokesman said revenue from salaries and profits tax was better than expected - despite a rise in the number of people asking to pay later. A tax partner with Grant Thornton, Paul Chow, forecast a full-year surplus of HK$10-billion to HK20-billion. But he said there could be a HK$30-billion to HK$50-billion deficit in the coming financial year. The Financial Secretary, John Tsang, will announce full year estimates in his budget next month. He warned that government finances could be volatile in the coming two months.

US economic output falls sharply

US economic output falls sharply
31-01-2009

The latest figures from the United States show the country's economic output fell 3.8 percent in the last three months of 2008, the worst quarterly contraction in more than 26 years. The decline marked a sharp downward movement in economic activity after a 0.5 percent decline in the third quarter. But the figure was not as bad as feared, with analysts on average predicting a 5.5 percent annualized drop in gross domestic product. The latest Commerce Department figures come as President Obama's stimulus package is passing through Congress.

Japanese companies make more job cuts

Japanese companies make more job cuts
31-01-2009

Japanese companies have announced thousands more job losses. Electronics giant, NEC, will fire 20,000 workers on expectations that its loss for the current financial year will reach US$3.2 billion. Losses in the first nine months soared 13-fold. Its rival, Hitachi, says it'll cut up to 7,000 jobs, and slashed its profit forecast by 90 percent. The country's second biggest carmaker, Honda, cut its full-year profit forecast by 57 percent. The firm says it expects a loss this quarter.

Wen in Spain for economic talks

Wen in Spain for economic talks
31-01-2009

Premier Wen Jiabao is leading a delegation expected to sign business deals in banking, telecommunications and other sectors on a visit to Spain. Mr Wen, who's on a European tour, met briefly in Madrid with King Juan Carlos and was to confer also with Prime Minister Jose Luis Rodriguez Zapatero for talks focussing on the global financial crisis and bilateral relations. China is Spain's largest trade partner outside the EU. Chinese exports to Spain have more than doubled since 2003 and reached nearly US$24 billion in 2007. Spanish exports are just a fraction of that. Mr Wen's tour has taken him to Germany, the World Economic Forum meeting in Davos, Switzerland, and EU headquarters in Brussels. He will visit Britain on Monday before returning home.

Obama calls recession a 'disaster'

Obama calls recession a 'disaster'
31-01-2009

President Barack Obama has called the contraction of the US economy in the final quarter of 2008 a "continuing disaster" for the US. The latest figures from the United States show the country's economic output fell 3.8 percent in the last three months of 2008, the worst quarterly contraction in more than 26 years. Mr Obama said the data meant Congress must not drag its feet on his stimulus plan. Speaking at the White House, the president also announced a new task force to help middle-class working families. He said the task force, to be headed by Vice President Joe Biden, would focus on creating well-paid jobs for middle-class working families. Mr Obama also said he wanted to "level the playing field" for labour unions, saying that strong unions needed to work "side by side" with strong businesses. The president said he had signed three executive orders to help workers, ensuring - among other things - that federal contractors offer jobs to existing workers when contracts change.

Sony reports large loss

Sony reports large loss
29-01-2009

The Sony corporation of Japan says it lost almost US$200-million in the third quarter of the financial year, because of the continuing global economic downturn. Another leading Japanese electronics firm, Toshiba, also warned that it may report an annual operating loss because of falling demand for some of its products.

Payout for Spanish Madoff victims

Payout for Spanish Madoff victims
29-01-2009

Spain's largest bank, Santander, is to offer compensation worth more than US$1.8 billion to clients who lost money in a huge investment fraud allegedly run by the American financier, Bernard Madoff. The bank will repay private clients who invested in its Optimal Strategic US equity fund by giving them preference shares in Santander. The bank says it is offering the compensation to maintain a business relationship with the clients involved. Santander is being sued over claims it did not do enough to prevent losses in funds that invested with Mr Madoff. He is accused of perpetrating one of the largest-ever Wall Street frauds, through a $50 billion scheme that wiped out many investors.

China's economic growth 'could slip'

China's economic growth 'could slip'
29-01-2009

An adviser to China's central bank says the country's economic growth in coming years could slip to seven percent or less a year. However, the adviser Fan Gang and his two co-authors said China's economy could grow at an average nine percent annually until 2020 if it sheds growing government costs and lifts consumer spending. Their findings were published in the January issue of the Chinese-language Economic Research Journal.

World growth 'worst for 60 years' - IMF

World growth 'worst for 60 years' - IMF
29-01-2009

The International Monetary FundWorld warns economic growth is set to fall to just 0.5% this year - its lowest rate since World War II.In October, the IMF had predicted world output would increase by 2.2% in 2009. It now projects the UK will see its economy shrink by 2.8% next year, the worst contraction among advanced nations. The IMF says financial markets remain under stress and the global economy has taken a sharp turn for the worse. The outcome, it says, has been to send global output and trade plummeting. The IMF says international cooperation is needed to draw up new policy initiatives, and for capital injections to support viable financial institutions.

Luxury car maker cuts production

Luxury car maker cuts production
29-01-2009

Aston Martin, the maker of luxury sports cars coveted by royals and James Bond, has become the latest manufacturer to cut production amid the global fall in demand. Workers at the company's factory in central England have been put on a three-day week. The cutbacks come less than two months after Aston Martin said it was shedding 600 jobs.Aston Martin sales fell 28 percent last year, despite the high-profile use of one of its cars in the latest Bond film "Quantum of Solace."

China's economy faces 'severe year'

China's economy faces 'severe year'
27-01-2009

Finance Minister, Xie Xuren, has warned that the mainland economy faces what he called "a very severe year" in 2009. In a holiday message, Mr Xie indicated that government budgets would be strained, as taxes were cut to stem the economic slowdown. He urged government departments at all levels to exercise care in public spending and keep their books balanced. Mr Xie said the difficulties in maintaining stable economic development would increase.

Major Dutch firms announce big job cuts

Major Dutch firms announce big job cuts
27-01-2009

There've been further announcements of large job cuts as the global recession intensifies. The Dutch electronics and medical company Philips says it plans to cut about six-thousand jobs worldwide because of a fall in demand. The Dutch financial group, ING is axing seven-thousand jobs to cut costs.

US to decide soon on China's yuan status

US to decide soon on China's yuan status
27-01-2009

President Barack Obama's new administration says it'll determine "in the spring" whether China is manipulating its currency. White House spokesman Robert Gibbs said the administration had not set its policy on the perennial controversy of the yuan's value, despite a stir caused by remarks by the treasury secretary designate Timothy Geithner last week. According to the spokesman, Mr Geithner was restating what Mr Obama had said during the election campaign. A formal designation that a country is manipulating its currency to gain an unfair trade edge could trigger US sanctions.

US stocks up slightly, but Europe surges

US stocks up slightly, but Europe surges
27-01-2009

Banks helped catapult London's FTSE 100 to a 3.9-percent gain, as Barclays sky-rocketed after saying it would not need fresh capital. Barclays soared more than 73 percent after the bank said it wasn't seeking extra funds because it was still profitable and could absorb a 2008 writedown of 8-billion pounds. Banks across Europe also joined the rally. As a result, European stock markets surged. In Paris, the CAC 40 added 3.73 percent while the Frankfurt Dax climbed 3.54 percent. US stocks also rose in choppy trade, lifted by a surprising gain in existing home sales and optimism over a 68-billion dollar takeover in the drug industry. The Dow broke a two-day losing streak, finishing 38-points up, or almost half a percent. The Standard & Poor's 500 Index rose just over half a percent while the Nasdaq finished just over point-eight of a percent up.

More layoffs as gloom deepens

More layoffs as gloom deepens
27-01-2009

More workers around the world face losing their jobs as several big corporations announced over 70,000 layoffs in a single day. The biggest cuts came in the US where construction equipment maker Caterpillar said it would cut around 20,000 jobs. Texas Instruments also announced it was cutting 12 percent of its global workforce, or about 3,400 jobs. In Europe, electronics group Philips, financial firm ING and UK steelmaker Corus announced cuts. Correspondents say the announcements underscore the depth of the global downturn. US President Barack Obama cited the layoff announcements as he urged Congress to approve an US$825 billion economic stimulus package of tax cuts, emergency benefits and public spending projects.

Geithner sworn in as US Treasury chief

Geithner sworn in as US Treasury chief
27-01-2009

The United States Senate has confirmed President Obama's choice as Secretary of the Treasury, Timothy Geithner, despite a controversy surrounding his personal taxes. He was approved by 60 votes to 34. President Obama has described Mr Geithner as the most qualified person to oversee his plans to revive the struggling US economy. However, some senators had expressed concern about his failure to pay thousands of dollars in taxes. Mr Geithner was sworn in as Treasury Secretary within hours of the Senate approving his nomination. Correspondents say he will have one of the toughest jobs in the new administration, as the US tries to get its economy back in shape.

More cutbacks from industry giants

More cutbacks from industry giants
26-01-2009

The world's biggest carmaker, Toyota, is reported to be cutting back its global production by 20-percent.The move would reduce the company's output by more than one-and-a-half million vehicles each year. Elsewhere, the major Anglo-Dutch steelmaker, Corus, is expected to announce that it's cutting three-thousand 500-jobs - most of those from its British plants. Corus, which was bought in 2007 by the Indian company, Tata Steel, has been hit hard by the global recession. Demand for steel from car-makers and the building industry has slumped by forty per cent in the past year, and the price has fallen by half.

Barack Obama's plans for economy opposed

Barack Obama's plans for economy opposed
26-01-2009

Prominent members of the opposition Republican party in the United States have threatened to vote against President Obama's 800 billion dollar plan to stimulate the economy. The Republican leader in the House of Representatives, John Boehner, said he thought the package would not work, and he wouldn't support it unless it were substantially changed. President Obama's top aides had earlier explained his plan to stimulate the economy. Speaking on Sunday television programmes, vice-president, Joe Biden, said they'd begin to promote economic activity by, as he put it, getting money out of the door as rapidly as possible. Chief Economic Adviser, Larry Summers, said the US couldn't afford Republican demands to renew tax cuts for wealthier Americans.

Microsoft outlines redundancy programme

Microsoft outlines redundancy programme
26-01-2009

Microsoft today finally outlined the vast scale of its redundancy programme as it declared 5,000 jobs would go worldwide. Around 60 UK staff were made redundant today as part of the first wave of lay-offs totalling 2,900. The remaining 2,100 will be imposed in the next 18 months. Today's cull is hugely symbolic for Microsoft as it is the first company-wide firing programme at the firm. Previous lay-offs have been product or division-specific. Chief Executive Steve Ballmer is under pressure to make savings as sales growth dries up.

Obama outlines job creation plan

Obama outlines job creation plan
25-01-2009

President Obama has been giving more details of his recovery plan for the American economy. In a video address, Mr Obama said the country was in the middle of an unprecedented crisis that called for unprecedented action. He warned that what he called a generation of potential could be lost, if action was not taken urgently. He said his recovery plan, which he hopes will become law in a month, will create many jobs by investing in vitally needed projects.