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Denmark says 65 world leaders to join climate talks

John Acher / Reuters — Sun, 22 Nov 2009 17:54:00 GMT

Copenhagen: Sixty-five world leaders have confirmed that they will attend a United Nations (UN) conference in Copenhagen in December that will try to clinch a new global climate deal, and many more are considering, Danish officials said on Sunday.

Seeking dialogue: Danish Prime Minister Lars Lokke Rasmussen. Analysts say the decision to invite leaders is a calculated risk. Simon Dawson / Bloomberg

Facing splits in the climate talks, Denmark 10 days ago formally invited the heads of state and government of 191 UN member states to come for the final two days of the 7-18 December conference to push for a deal at the meeting, originally meant for environment ministers. Danish officials declined to provide a full list of those who had agreed to come to the Copenhagen conference, but noted some leaders, such as those from Britain, Germany, France, Spain, Australia, Japan, Indonesia and Brazil, had announced their intention to attend.

UN said this month that around 40 leaders had indicated plans to attend, mostly from developing nations as well as from Germany and Britain, even before the official invitation. European Commission president Jose Manuel Barroso has said he would come. And US President Barack Obama has said he would attend if it could give impetus to a deal.

Danish Prime Minister Lars Lokke Rasmussen’s decision to invite world leaders is a calculated risk, analysts say. Their presence can raise chances of a deal but the need for a summit is an admission that negotiations are in trouble after a final round of talks in Barcelona this month.

(Anna Ringstrom contributed to this story.)

EU names Belgian PM as first President

Reuters — Fri, 20 Nov 2009 09:37:00 GMT

Brussels: European Union leaders named Belgian Prime Minister Herman Van Rompuy, who is little known outside his own country, as the bloc’s first president on Thursday to lead efforts to make it more influential on the world stage.

They also chose Baroness Catherine Ashton, a Briton little known even in her own country, as EU foreign affairs chief under a deal that kept out more established figures such as Tony Blair, and raised questions about how the bloc plans to lift its profile.

The appointments are intended to bolster the EU’s standing and help it to match the rise of emerging powers such as China following the global economic crisis, but neither Ashton nor Van Rompuy is a familiar figure outside Europe.

“I believe my experience will speak for itself. Am I an ego on legs? No I’m not. Do I want to be seen to be out there saying everything all the time? No I don’t. Judge me on what I do and I think you’ll pleased with the outcome,” Ashton told reporters.

Von Rompuy promised to move “step by step” to help Europe out of “exceptionally difficult times, a period of anxiety, uncertainty and lack of confidence”.

Van Rompuy, 62, and Ashton, 53, are compromise candidates who plan to use quiet diplomacy and consensus. At least initially they will not have the weight in foreign capitals that a better-known figure such as Blair, a former British prime minister, would have had.

Agreement on the positions took weeks, undermining efforts to present the bloc as a united force, partly because Britain had demanded Blair should be president.

The breakthrough came when Prime Minister Gordon Brown dropped that demand and backed EU Trade Commissioner Ashton as foreign affairs chief and vice-president of the EU’s executive European Commission instead.

Political balance

The role of president of the council of EU leaders was created under the Lisbon treaty, which takes effect on 1 December and creates a diplomatic corps to be headed by Ashton. She replaces Spaniard Javier Solana.

The White House said Washington had no stonger partner than Europe in advancing security and prosperity around the world.

“These two new positions, and related changes to take effect on 1 December as a result of the implementation of the Lisbon Treaty, will strengthen the EU and enable it to be an even stronger partner to the United States,” it said.

EU leaders had sought a political balance to satisfy member states and the European Parliament, whose approval is needed for Ashton. This was achieved by appointing a centre-right president and a centre-left high representative for foreign affairs.

Van Rompuy, who will not need the assembly’s approval, won plaudits for holding together Belgium’s fragile coalition government after becoming prime minister less than a year ago.

Ashton, a former member of the House of Lords, Britain’s upper house of parliament, has little foreign affairs experience. But she has made a good impression as trade commissioner.

“I’m one of those people that believe that characters can grow into jobs,” German Chancellor Angela Merkel said.

Blair had long been the front-runner but many other states wanted a candidate more likely to lead by consensus, and Germany and France joined forces to block his candidacy.

They remain powerful forces in the EU although they have none of the top jobs which also include a Portuguese, Jose Manuel Barroso, as European Commission President.

Barroso will now complete the line-up of the Commission under him and Ashton. Deals are sure to have been made on some of the jobs during the consultations on the top jobs led by Sweden, which holds the EU presidency for the rest of this year.

EU diplomats said it was now all but certain that former French foreign minister Michel Barnier would be commissioner for the EU’s internal market, one of the most powerful and most sought-after positions in Barroso’s team.

Failure to agree on the top jobs would have highlighted divisions in a bloc representing nearly 500 million people, and undermined the goal of boosting the EU’s image abroad.

In backing Ashton, the leaders also answered calls by many EU officials for a woman to have one of the Union’s top posts.

EU leaders deadlocked over top 2 EU jobs

AP — Thu, 19 Nov 2009 11:33:00 GMT

Brussels: The European Union’s 27 leaders were facing an all-nighter Thursday as a bruising battle loomed over who to name as the bloc’s first full-time president and new foreign policy chief.

Sweden’s Prime Minister Fredrik Reinfeldt, chair of the EU summit, said despite his best efforts at mediation the EU leaders were deadlocked ahead of the dinner that will decide the issue Thursday night.

Reinfeldt told reporters in Stockholm that “it might take all night” to get all the leaders to agree on two names, and added that the list of candidates he has drafted is far too long.

“We are not of the same opinion,” said Reinfeldt. “I need of course the collaboration of all my colleagues to get this through.”

Time is pressing for the leaders, as the new posts must be filled before the EU’s new reform treaty comes into force on 1 December.

At stake is how the European Union presents itself to the world in years to come. The two posts aim to bolster the bloc’s influence amid the rise of China, Brazil and India to handle global issues like climate change, terrorism and trade.

The leaders are trying to strike the right balance between big countries and small, rich and poor, east and west, socialists and conservatives, male and female. Lawmakers and protesters have already questioned why only one woman is being considered so far.

Belgium’s little-known Premier Herman Van Rompuy leads the pack of half a dozen mentioned politicians said to be interested in the presidential post, which is being created under the new EU charter.

Britain however, opposes Van Rompuy and is pushing hard for ex-prime minister Tony Blair to get the job, saying Europe needs a high-profile EU president.

Others like France and Spain, fearing Blair would overshadow them, favor a low-profile person in the top EU post, one limited to chairing summits and greeting foreign dignitaries.

“The person should be a co-ordinator rather than a president,” said Jerzy Buzek, speaker of the European Parliament.

Smaller EU nations loathe the idea of being led by Blair, whose strong support for the Iraq war angered many Europeans. They also want a president from a country that uses the EU’s common euro currency and participates in its passport-free travel zone. Britain has opted out of those EU projects.

Other possibilities for president include Dutch Prime Minister Jan-Peter Balkenende, Luxembourg Premier Jean-Claude Juncker, Estonian President Toomas Ilves, and Vaira Vike-Freiberga, the former Latvian president and the only female candidate touted.

No candidates so far are from France or Germany, the traditional motors of the EU.

The EU reform treaty does not spell out what the EU president’s job really is. The original idea was that a European president would give the EU a bigger profile on the world stage, one commensurate with its economic heft.

But that appears to have changed. Power seems to have shifted to the EU’s new foreign minister, who will get a say over the bloc’s annual €7 billion ($10.5 billion) foreign aid budget and a new 5,000-strong EU diplomatic corps.

The EU has a long history of horse-trading for plum jobs. In 1994, leaders took 12 hours and a veto by Britain to pick an European Commission president. In 1998, it took another 12 hours to choose the first European Central Bank chief, and the EU ended up having two people split the term.

Merkel decides to attend Copenhagen climate summit

AFP — Mon, 16 Nov 2009 11:48:00 GMT

Berlin: Chancellor Angela Merkel has decided to attend the Copenhagen crunch climate conference after leaders including US President Barack Obama buried hopes of a binding deal, her spokesman said Monday.

“I don’t have to beat around the bush, of course yesterday’s outcome did not exactly spark great euphoria,” spokesman Christoph Steegmans told reporters in Berlin.

“This is partly why the chancellor decided to play an active role in ensuring that the bar is not set too low in Copenhagen, and that we try to make the most of it and not to let anyone off their responsibilities,” he said.

Asia-Pacific leaders including Obama and China’s Hu Jintao on Sunday shot down in flames any remaining hopes that the December 7-18 Copenhagen meeting would result in a binding international pact to combat climate change.

Instead they backed a face-saving proposal from Danish Prime Minister Lars Loekke Rasmussen, who jetted in for hastily arranged talks in Singapore, aimed at forging a political statement.

Complex negotiations towards a legally enforceable successor to the Kyoto Protocol on climate change, which expires in 2012, would then continue to work out differences between rich nations and developing countries including China.

In a final declaration, the 21-member Asia-Pacific Economic Cooperation (APEC) also dropped a proposal included in earlier drafts to slash their greenhouse gas emissions to half their 1990 levels by 2050.

Environmental group WWF said the leaders had “missed a great opportunity to move the world closer to a fair, ambitious and binding agreement” and that “this does not look like a smart strategy” to battle climate change.

“The bar must not be set too low at Copenhagen. Copenhagen has to be an important milestone, and also of course a first step towards a binding agreement next year,” Merkel’s spokesman said.

“What the German government expects from the Copenhagen summit is an important step along the way to a binding agreement in the framework of the United Nations.

“The chancellor, together with her partners in the European Union, wants to make sure that the maximum possible is achieved there (in Copenhagen) towards this,” Steegmans said.

Merkel would arrive on the evening of 17 December, Steegmans added.

Environment ministers from 44 key countries gathered Monday in Copenhagen for a two-day closed-door meeting to prepare for the conference.

The delegations taking part were from the United States, China, India and Brazil as well as several island nations and African states that are among the poorest in the world.

British unemployment rate at 7.8%: official

AFP — Wed, 11 Nov 2009 14:15:00 GMT

London: Britain’s unemployment rate inched up to 7.8% in the three months to September, official data showed on Wednesday, although the number of unemployed rose by the smallest amount in 18 months.

“The unemployment rate rose by 0.1 percentage point to 7.8% for July to September 2009,” compared with the three months to June, the Office for National Statistics (ONS) said in a statement.

“The number of unemployed people increased by 30,000 over the quarter to reach 2.46 million.”

“These are the smallest quarterly increases in unemployment since March-May 2008.”

Lloyds to cut further 5,000 jobs by 2010 end

Reuters — Tue, 10 Nov 2009 11:34:00 GMT

London: Bailed-out British lender Lloyds Banking Group is to cut a further 5,000 jobs by the end of 2010 as it continues to overhaul its operations and integrate HBOS.

Lloyds, 43% owned by the government, said on Tuesday it would take mitigating actions, including redeploying staff and releasing contractors and temporary employees, to limit the net reduction in permanent jobs to 2,600.

That would take net cuts to permanent jobs at Lloyds to around 9,000 since it acquired HBOS in January. Analysts have estimated that over 30,000 jobs could go as the two banks integrate.

News of further bank sector redundancies came a week after more than 5,400 jobs were cut at part-nationalised rival Royal Bank of Scotland and HSBC.

The Unite union said the cuts were “corporate arrogance”.

“This country’s financial sector should be looking towards the future, rather then continuing to slash jobs without proper consideration of how to re-build the public’s confidence in our tarnished banking sector,” Unite national officer Rob MacGregor said in a statement calling for a suspension of job losses.

Lloyds said 2,820 roles — the bulk of the total — would be cut in group operations, with contractors and temporary staff helping to keep the net reduction to 1,350.

It will also cut 1,190 jobs in insurance across Britain, and 950 in its mortgage operations where business will be consolidated to a handful of sites.

Lloyds said compulsory redundancies would be a last resort.

Britons face higher credit card charges: PwC

Reuters — Mon, 09 Nov 2009 09:44:00 GMT

London: British consumers face higher rates and fees on credit cards as lenders battle rising bad debts, funding constraints and reduced appetite for borrowing, accountants PricewaterhouseCoopers (PwC) said on Monday.

These changes, combined with rising regulatory and government scrutiny, would shake up the market and prove the current model based on fee-free credit cards was unsustainable, PwC said in an annual report on consumer credit.

“Lenders will be unable or unwilling to increase supply sufficiently to match demand. This will leave consumers surprised at both the cost of credit and the difficulty in gaining access to it,” PwC partner Richard Thompson said.

Britain, the only country in Europe with more credit cards than people, has seen borrowing drop 3% in the past year as consumers cut back and banks tighten the purse strings.

But lenders have still been left with rising bad debts.

Impaired loans hit 6% of outstanding balances and could rise to 9% by the end of 2010, PwC said.

“This would have enormous implications for the profitability of credit cards in the UK market. Large-scale change within the sector over the next few years is inevitable,” Thompson said.

PwC predicted lenders would scrap current business models — built on free credit cards but costly borrowing — predicting premium customers would see higher standard fees, while marginal spenders will have pay to hold even a basic card.

Internet bank Egg, owned by US bank Citigroup, has already introduced a one pound monthly fee for inactivity.

Lenders will also reposition cards, tapping innovations such as pre-paid cards, contactless payment, and even payments by mobile phone, PwC said.

Barclaycard has said technology it is looking at includes “contactless” cards, and its chief executive has warned changes to the industry could see plastic cards thrown onto the scrapheap in as little as three years.

Credit card providers are also facing increased scrutiny from competition authorities, regulators and a government probe into credit and store cards looking at issues including higher minimum payments to get balances paid off more quickly and a ban on unsolicited increases to credit limits.

Based on discussions with issuers grappling with the US Credit Card Act, PwC said the outcome would be higher costs.

“With the UK credit card business model already under significant pressure, any further measures to restrict issuers could increase the cost of credit cards to consumers and reduce their availability to certain segments of the market,” it said.

PwC said it expected changes would also result in an increase in portfolio sales, as lenders try to unlock liquidity and buyers return to the market, lured by potentially attractive discounts.

The government has said it wants to see more competition in retail banking and would be expected to support new lenders.

PwC said regulators had reported a number of applications for new banking licenses.

Germany celebrates memory of Berlin Wall falling

AP — Mon, 09 Nov 2009 03:56:00 GMT

Berlin: With concerts and memorials on Monday, Germans will celebrate the day the Berlin Wall came crashing down 20 years ago.

On that cold night, they danced atop the wall, arms raised in victory, hands clasped in friendship and giddy hope. Years of separation and anxiety melted into the unbelievable reality of freedom and a future without border guards, secret police, informers and rigid communist control.

Germans are celebrating with concerts boasting Beethoven and Bon Jovi; a memorial service for the 136 people killed trying to cross over from 1961 to 1989; candle lightings and 1,000 towering plastic foam dominoes to be placed along the wall’s route and tipped over.

On 9 November 1989, East Germans came in droves, riding their sputtering Trabants, motorcycles and rickety bicycles. Hundreds, then thousands, then hundreds of thousands crossed over the following days.

Stores in West Berlin stayed open late and banks gave out 100 Deutschemarks in “welcome money,” then worth about $50, to each East German visitor.

The party lasted four days and by 12 November more than 3 million of East Germany’s 16.6 million people had visited, nearly a third of them to West Berlin, the rest through gates opening up along the rest of the fenced, mined frontier that cut their country in two.

Sections of the nearly 155 kilometers (100 miles) of wall were pulled down and knocked over. Tourists chiseled off chunks to keep as souvenirs. Tearful families reunited. Bars gave out free drinks. Strangers kissed and toasted each other with champagne.

Klaus-Hubert Fugger, a student at the Free University in West Berlin, was having drinks at a pub when people began coming “who looked a bit different.”

Customers bought the visitors round after round. By midnight, instead of going home, Fugger and three others took a taxi to the Brandenburg Gate, long a no man’s land, and scaled the 12-foot (nearly four meter) wall with hundreds of others.

“There were really like a lot of scenes, like people crying, because they couldn’t get the situation,” said Fugger, now 43. “A lot of people came with bottles” of champagne and sweet German sparkling wine.

Fugger spent the next night on the wall, too. A newsmagazine photo shows him wrapped in a scarf.

“Then the wall was crowded all over, thousands of people, and you couldn’t move ... you had to push through the masses of the people,” he said.

Angela Merkel, Germany’s first chancellor from the former communist East, recalled the euphoria in an address last week to the US Congress.

“Where there was once only a dark wall, a door suddenly opened and we all walked through it: onto the streets, into the churches, across the borders,” Merkel said. “Everyone was given the chance to build something new, to make a difference, to venture a new beginning.”

The wall the communists built at the height of the Cold War and which stood for 28 years is mostly gone. Some parts still stand, at an outdoor art gallery or as part of an open-air museum. Its route through the city is now streets, shopping centers, apartment houses. The only reminder of it are a series of inlaid bricks that trace its path.

Checkpoint Charlie, the prefab that was long the symbol of the Allied presence and of Cold War tension, has been moved to a museum in western Berlin.

Potsdamer Platz, the vibrant square that was destroyed during World War II and became a no man’s land during the Cold War, is full of upscale shops selling everything from iPods to grilled bratwursts.

At a ceremony in Berlin 31 October, Helmut Kohl, the German chancellor who presided over the opening of the wall, stood side by side with the superpower presidents of the time, George HW Bush and Mikhail Gorbachev.

After the decades of shame that followed the Nazi era, Kohl suggested, the collapse of the Berlin Wall and the reunification of their country 11 months later gave Germans pride.

“We don’t have many reasons in our history to be proud,” said Kohl, now 79. But as chancellor, “I have nothing better, nothing to be more proud of, than German reunification.”

In an interview in Moscow with Associated Press Television News, Gorbachev said it was a catalyst for peace.

“No matter how hard it was, we worked, we found mutual understanding and we moved forward. We started cutting down nuclear weapons, scaling down the armed forces in Europe and resolving other issues,” he said.

It all began with a routine late afternoon news conference.

On 9 November 1989, Guenter Schabowski, a member of East Germany’s ruling Politburo, casually declared that East Germans would be free to travel to the West immediately.

Later, he tried to clarify his comments and said the new rules would take hold at midnight, but events moved faster as the word spread.

At a remote crossing in Berlin’s south, Annemarie Reffert and her 15-year-old daughter made history by becoming the first East Germans to cross the border.

Reffert, now 66, remembers the East German soldiers being at a loss when she tried to cross the border.

“I argued that Schabowski said we were allowed to go over,” she said. The border soldiers relented. A customs official was astonished that she had no luggage.

“All we wanted was to see if we really could travel,” Reffert said.

Years later, Schabowski told a TV interviewer that he had gotten mixed up. It was not a decision but a draft law that the Politburo was set to discuss. He thought it was a decision that had already been approved.

That night, around midnight, border guards swung open the gates. Through Checkpoint Charlie, down the Invalidenstrasse, across the Glienicke Bridge, scores of people streamed into West Berlin, unabated, unfettered, eyes agog.

G-20 FMs to pledge stimulus stays, look at growth

Sumeet Desai / Reuters — Fri, 06 Nov 2009 11:30:00 GMT

St Andrews, Scotland: The Group of 20 leading nations will agree this weekend it is too early to pull the plug on emergency support for the global economy and launch a new system of checks to help rebalance world growth and prevent future crises.

British finance minister Alistair Darling is hosting the third meeting of G-20 finance ministers and central bankers this year in St Andrews, Scotland from later on Friday, aiming to put flesh on the bones of agreements made at a leaders’ summit in Pittsburgh in September.

Since then there have been growing signs that the world is finally coming out of the deepest downturn in decades and that things may be getting back to normal after a crisis that wiped out some of the biggest financial institutions.

The European Central Bank on Thursday took a first small step towards easing out its crisis steps - ultra-low interest rates and cash injections for the economy - by signalling one-year loans to banks will not be repeated next year.

But Darling said it would be premature to declare victory over what has been the worst financial crisis since the 1930s and the extraordinary stimulus countries all around the world had thrown into their economies had to stay in place for now.

“I think we can reach agreement on firstly making sure we don’t remove support too early because the recovery is by no means established everywhere,” he told Reuters.

“Just as there was a consensus that we took action over the last year to stave off a serious downturn, there is a consensus that we can work together so that the next decade is one of growth and one of job creation,” Darling said.

Checks and balance

Ten years after the G-20 was formed, leaders agreed in Pittsburgh that it should be the world’s main economic governing council, because it also includes most of the key developing economies -- unlike forums like the G-7 or G-8.

Officials say that proposals on the table in Scotland include a system where countries put forward projections for their own economies for examination by the International Monetary Fund to see if they are consistent with each other.

If not, then alternatives can be looked at within the G-20.

Asked if that meant countries would be given targets they had to achieve, for example on GDP, Darling said: “I don’t think it is a case of people telling countries what they ought to do.”

“We need to have a target in our mind as we work through this of where we want to see world growth in the next few years but obviously the growth rates in individual countries will be different.”

Officials have made clear currency moves are not on the formal agenda for the meeting, even if there is general disquiet about the weakness of the dollar behind closed doors.

The group may also look at proposals for creating a common pool of reserves to dissuade emerging market countries from accumulating massive foreign exchange reserves that could instead be used to boost growth.

Brazil’s president Luiz Inacio Lula da Silva late on Thursday voiced concern the slight pickup in the world economy could hamper the drive for reform of the financial system.

“The small signs of improvement of the economy could create impediments for us to accomplish deep reforms without which humanity could have a relapse in a much more severe way (into) a new crisis,” Lula said in a speech in London.

Long road to Copenhagen

Another theme will be seeking a deal on climate finance ahead of an environmental summit in Copenhagen next month but Darling was doubtful that concrete results could be achieved.

“I want to use this weekend to engage finance ministers in the task of making sure we can get money on the table. We have been very clear we think $100 billion will be required,” he said.

Talks on agreeing a budget for the cost of dealing with climate change at the last meeting of finance ministers and central bankers in London in September went nowhere.

“This is a classic case rather like world trade where the spirit is willing but some very great heavy lifting is going to be required if we are going to make the progress we need,” Darling said.

“There is a long way to go, it is by no means certain that we will get the deal we need at Copenhagen. I know we will try our level best level to get there.”

Global unemployment up despite economic recovery

Greg Keller / AP — Fri, 06 Nov 2009 05:29:00 GMT

Paris: Despite signs of an economic revival gathering pace around the globe, the millions of people laid off during the worst recession in 70 years are unlikely to see relief any time soon as joblessness is still climbing in many of the world’s largest economies.

Unemployment data typically lags other indicators of economic health as companies hold off adding staff in the early stages of a rebound. The upturns recorded recently in the United States, France, Germany and elsewhere have been largely driven by temporary factors such as industry restocking following spending freezes, as well as the billions spent on stimulus programs.

This week the European Union (EU) forecast unemployment in the Eurozone will rise to 10.7% in 2010 from 9.5% this year.

Unemployment rates in the 30 wealthy countries that belong to the Organization for Economic Cooperation and Development (OECD) range from a low of 3.5% in the Netherlands to 18.3% in Spain, according to September figures.

And Eurozone unemployment rose to a 10-year high of 9.7% in September.

In the developing world, the downturn has also taken its toll. Unemployment in Brazil appears now to be stabilizing, but in Mexico, after hitting a 13-year high in August, unemployment has continued to rise, reaching 6.4% in September.

In the United States, economists expect the unemployment rate will tick up to 9.9% when October’s figure is reported on Friday. The jobless rate hit a 26-year high of 9.8% in September.

Here is a look at unemployment rates around the world:

Germany: German unemployment fell for a second month in October, but the effects of the financial crisis lingered and it is still too early to expect a turnaround in the economy, the country’s labor ministry said. The unadjusted jobless rate in Europe’s biggest economy was 7.7%, down from 8% the previous month and below the 8.3% in August, the Federal Labor Agency said. The dip in unemployment comes nearly two weeks after the German government raised its growth forecast and predicted that Europe’s biggest economy will expand by 1.2% in 2010, up from an earlier prediction of 0.5%.

France: The increase in French jobless lines has been somewhat tempered by government incentives such as exempting payroll taxes for some workers. The unemployment rate rose to 9.8% in September from 7.8% in 2008, according to the OECD. It is expected to hit 10% by the end of the year.

Britain: Britain’s Office for National Statistics says unemployment in the United Kingdom was 7.9% in the three months to August. The rate held although the number of people out of work was 88,000 higher than in the previous three months, the report said. The number of jobless looks on course to pass the three million mark next year as the impact of the recession translates to rising dole queues.

Japan: Japan’s unemployment rate fell for the second straight month in September as companies gained more confidence in the stimulus-fueled global recovery but prices continued to tumble, underscoring weak demand at home. The jobless rate stood at a seasonally adjusted 5.3% in September, down from 5.5% the previous month and a record high of 5.7% in July, the government said on Friday. The figures suggest job losses in the world’s second-biggest economy are easing as companies gain more confidence that global demand for Japan’s cars, electronics and other mainstay exports is picking up. Japan’s factory output posted its seventh consecutive rise in September.

China: The official urban unemployment rate was 4.3% for the three months ended 30 September, unchanged from the previous three month period. But the actual level could be more than double that because the government system ignores millions of migrant workers and employees who are furloughed by state companies but not recorded as laid off. As of 30 September there were 9.15 million registered unemployed people in an urban workforce of 210 million. As many as 30 million migrants are believed to have lost jobs in export-oriented factories in late 2008, government officials said.

Brazil: The government says the unemployment rate was 8.1% in August, virtually unchanged from the previous month. Brazil emerged from recession in the second quarter. Analysts predict the economy will expand slightly in 2009.

Fiscal austerity may hamper ECB’s path to exit

Reuters — Tue, 03 Nov 2009 11:19:00 GMT

Frankfurt: The European central bank may have to go slow on withdrawing its support for the economy if euro zone governments come through on promises to start getting budgets into line from 2011.

Over the last month, ECB policymakers have sharpened their tone on shaky public finances, pressing governments to clean up budgets quickly or face the risk of proportionately higher interest rates — bringing higher repayments on public debt.

Economists see little chance of the ECB raising rates as a punishment for slow action but note central bankers cannot ignore the impact of fiscal exits when setting interest rates. European Union members have promised to start deep cuts to budgets by 2011 at the latest and many have a tough job ahead to get deficits back in line with the EU’s limit of 3% of gross domestic product (GDP) this year.

The European Commission expects the euro zone budget deficit to more than triple to 6.4% of GDP this year, with countries like Ireland and Spain in double-digits. Public debt is seen at 78% of GDP this year, far above the EU’s 60% limit.

Analysts polled by Reuters expect the ECB to start raising interest rates from a 1% record low in the fourth quarter of 2010, likely reaching 2.25% by mid-2011.

But if fiscal exit strategies drag on the economy that year, the ECB might find it cannot normalise rates as quickly as it might do in other circumstances, and lag the 2 percentage point tightening in 18 months seen from December 2005.

“If it’s a significant budget consolidation with a negative effect on growth of course it will mean that the ECB will raise rates less, or less fast, than otherwise,” Bank of America Merrill Lynch economist Holger Schmieding said. “But we would first of all have to see the fiscal tightening.”

Think-tank Bruegel, in a paper prepared for EU finance ministers’ and central bankers’ informal meeting last month, recommended central banks wait to withdraw liquidity and monetary support until after fiscal reforms.

“Simultaneous and vigorous pursuit of all three exit policies might entail a serious risk of a double-dip recession and a renewed crisis in the banking sector,” the group said.

The ECB says it will unwind its support measures as soon as the recovery starts and ECB President Jean-Claude Trichet has firmly dismissed any “ex ante coordination” of exits with governments.

But the ECB does not set policy in a vacuum and says it takes all variables into account, including fiscal ones.

Hollow Threats

Economists calculate euro zone governments have announced extra crisis spending worth about 1% of GDP this year, and slightly less in 2010.

The fiscal exit will involve unwinding these steps, as well as wider budget reforms — BNP Paribas calculates it will take 10 years of surpluses worth 2.7% of GDP to cut debt to an acceptable 60% ratio.

Further complicating the ECB’s exit path is the uncertain economic benefit of such crisis measures, meaning it is difficult to predict the impact of their withdrawal.

Merrill’s Schmieding calculates fiscal stimulus will add about 0.5 percentage points to 2009 growth and slightly less in 2010.

“That of course means that 0.5 will be missing the following year without fiscal stimulus, and if policy goes into reverse, which it should then ... the overall impact will even be bigger,” he said.

However, if confidence improved as a result of reforms, the negative growth impact would be blunted, while hiking indirect taxes to fund projects would put upward pressure on inflation and increase the case for higher interest rates.

“Just as not every euro that governments are spending in their stimulus packages is actually good for growth, not every fiscal retrenchment will be bad for growth,” Schmieding said.

RBS economist Jacques Cailloux estimates the impact on 2009 growth from fiscal stimulus at a scant “couple of tenths” of a percentage point.

“If it’s pure spending, you would say it’s one for one. But if it’s an infrastructure investment which is spread over a couple of years, gauging the impact on GDP is far more difficult,” he said, pointing also to geographic differences.

“A typical case is that German fiscal stimulus ends up being saved, while in other countries it goes into spending.”

Goethe University of Frankfurt professor Volker Wieland said the impact of fiscal stimulus was often muted by government spending crowding out consumer spending.

“Consumers may already cut back their purchases and save more now, because they realize that as taxpayers they will have to pay the bill later,” he said.

Such forecasting difficulties partly explain why economists set little store in the ECB’s warnings on budget discipline, which have gone up a notch in the last month.

Finland’s Erkki Liikanen urged a timely withdrawal of stimulus, saying this would give the ECB more room to support growth without fanning inflation.

Executive Board member Juergen Stark wielded a stick to Liikanen’s carrot, saying fiscal excess could have “severe consequences” for the economy and ECB policy.

Analysts said politicians would not pay too much attention.

“It would be very difficult to get a consensus within the (ECB) Council to say that because x country or the euro area as a whole has not done its job on the fiscal side, that they should raise rates by x amount more to offset this, and vice versa,” Cailloux said.

But markets, which have already pushed up the cost of Greek and Irish debt compared to German, might be more effective.

“I don’t think the European Commission can do much and neither can the ECB. But the market can. If you are a government and your borrowing costs have increased by x basis points relative to two years ago, you think twice before you go to the market,” Cailloux said.

France proposes climate plan to help poorest countries

Reuters — Sun, 01 Nov 2009 12:19:00 GMT

Paris: France is proposing a plan to help the world’s poorest countries finance renewable energy projects that it hopes will form part of upcoming climate talks, ecology minister Jean-Louis Borloo said in an interview on Sunday.

The “justice-climate” plan could be financed by revenue from financial transactions, he told the Journal du Dimanche newspaper, without elaborating or specifically calling for a tax.

Borloo hopes the plan, which the newspaper quoted sources saying could raise €20 billion a year, will help break the deadlock between rich and poor at talks in Copenhagen in December aimed at agreeing a new climate treaty. “The industrialised countries which have polluted a lot should mobilise to finance the development of renewable energy in the most vulnerable countries,” Borloo told the newspaper.

“They represent 1.2 billion people who suffer the most from climate problems. Between this shock, their lack of economic development and their absence from big international negotiations, they are really undergoing a triple punishment.”

The money would be targeted towards specific programmes such as hydraulic dams, solar energy stations or wind turbines, he said.

The idea of a tax on financial transactions, sometimes called a Tobin tax after economist James Tobin, has come up regularly in recent months as policymakers examine how financial markets might help pay for the effects of the financial crisis.

British Prime Minister Gordon Brown said European Union leaders agreed a funding proposal for Copenhagen at a summit on Friday after healing a rift over how to split the bill.

He said developing nations need €100 billion ($148 billion) a year from 2020 to battle climate change. About €22 billion-€50 billion of the total will come from the public purse in rich countries. The climate talks began in 2007, spurred by findings by the United Nations Climate Panel that world emissions would have to peak by 2015 to avoid the worst of desertification, floods, extinctions or rising seas. But progress has been slow because industrialized countries and poor countries are split about how to share curbs on greenhouse gases.

Unilever to replace more top managers

Jeroen Molenaar / Bloomberg — Thu, 29 Oct 2009 16:54:00 GMT

Amsterdam: The world’s second biggest consumer products maker, Unilever NV plans to replace more of its top 100 managers next month, chief executive officer Paul Polman said.

Cutting cost: Unilever chief executive officer Paul Polman. Abhijit Bhatlekar / Mint

Since taking the helm in January, Polman has replaced 40 of the top 100 people and Unilever will be going through another round in November, he said on Wednesday at a conference of the American Chamber of Commerce in Amsterdam.

Polman, a former Nestle SA and Procter and Gamble Co. (P&G) executive, this year became the first outsider to lead the Rotterdam- and London-based company in its 79-year history, in the midst of the worst economic crisis since the Great Depression. To evoke a sense of urgency within the company, he froze salaries, including his own, and made bonuses dependent on volume growth of Unilever products instead of earnings per share.

“The economic crisis was the best thing that happened to me,” he said. Having made a lot of progress under his predecessor Patrick Cescau, Unilever wasn’t aware of standards of the outside world and the decline gave Unilever no time to waver.

Polman also increased ad spending, boosted promotions and accelerated new-product introductions to stoke sales growth, which had lagged behind that of P&G and Nestle for years. Last month, the CEO broke a nine-year streak of avoiding major takeovers to pursue the €1.28 billion (Rs8,960 crore) purchase of Sara Lee Corp.’s shower gel and European detergents business.

“We’re in for a long and slow recovery of the economy,” Polman said. “I assure you, we will get out of this crisis stronger.”

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WTO’s Lamy sees no progress in Doha Round talks

Jonathan Lynn / Reuters — Fri, 23 Oct 2009 12:48:00 GMT

Geneva: Negotiations to open up global commerce have made no real progress lately and are moving too slowly to hit the target of a Doha Round deal by 2010, the head of the World Trade Organization said on Friday.

WTO director-general Pascal Lamy said intensive talks had not advanced enough to reach a core deal in the Doha negotiations, now in their eighth year, by early 2010. That would be necessary to reach an overall detailed accord next year, as called for by political leaders.

“We have not yet seen tangible progress in the negotiations and, overall, I would say that the current speed with which we are advancing is too slow ... to be in a position to wrap this round next year,” Lamy told a meeting of the WTO’s 153 members.

The Doha talks are stalled over differences between exporters and importers, and rich and poor countries on how much to cut farm subsidies and industrial and agricultural tariffs, as well as opening up markets for services.

Friday’s meeting had been called to take stock of progress after a week of meetings attended by senior officials from capitals and to discuss the next moves.

WTO members from Brazil to China expressed concern at the way the talks were going, in line with gloom after a meeting on Thursday of key delegations.

Many again expressed frustration at being left out of meetings in small groups, such as a series hosted by the European Union for a dozen countries, that they said touched on questions of vital interest to them.

Turkey’s WTO ambassador, Bozkurt Aran, told Friday’s session that it was the least promising meeting since he arrived in Geneva just over a year ago, according to one participant.

Lamy called on delegates to ensure that the next week of meetings with senior officials, starting 23 November, led to real negotiations and not just discussions, which meant they must involve well-prepared proposals laid down in negotiating texts.

Only that would lead to progress that the WTO’s 30 November-2 December ministerial conference could review and act on, he said.

Developing countries must boost broadband: UN

Reuters — Fri, 23 Oct 2009 09:55:00 GMT

Geneva: Developing countries risk missing out on the benefits of information technology because of their lack of broadband infrastructure, a UN agency said.

Lack of broadband Internet access deprives countries of the possibility of building up offshoring industries, the United Nations Conference on Trade and Development (UNCTAD) said in a report late on Thursday.

It also prevents people from tapping into all the advantages of mobile phones, whose use is exploding in poor countries.

“The narrowing of the digital divide remains a key development challenge,” UNCTAD Deputy Secretary-General Petko Draganov said.

“What is known as the broadband gap for example is becoming a serious handicap for companies in many poor countries,” he told a briefing to launch UNCTAD’s Information Economy Report.

Companies and consumers are 200 times more likely to have access to broadband in developed countries than in the poorest Least Developed Countries (LDCs), the report shows.

And the cost of broadband access varies widely - over $1,300 a month in Burkina Faso, the Central African Republic and Swaziland against less than $13 in Egypt or Tunisia.

Broadband is essential for offshoring industries such as call centres and back offices, which many developing countries in Africa, the Caribbean and Asia want to develop and expand.

Such industries are likely to expand despite the economic crisis because they enable companies in rich countries to cut costs, UNCTAD notes.

Broadband allows consumers to make better use of their mobile phones - rapidly overtaking computers as the information and communications technology (ICT) tool of choice in developing countries.

People in poor countries are using mobile phones for banking, to check markets and monitor the weather - reducing the need for travel and boosting productivity, UNCTAD noted.

As a result mobile phone usage is growing. In Africa there are already 20 times more mobile subscribers than fixed lines, and India added almost 100 million new mobile subscribers in the first seven months of this year, it said.

However, the economic crisis has hit sales of ICT goods such as phones and computers and trade in them declined dramatically last year, according to figures from the top six exporters - China, Singapore, Japan, Hong Kong, United States and Germany.

Exports have recovered this year, especially from China, now by far the biggest ICT goods exporter.

This is part of a continuing shift to dominance of the sector by Asia, which already accounted for more than half of ICT goods exports by 2007, UNCTAD said.

ICT exports are not only growing faster in China than elsewhere, but are also the fastest growing sector in China.

Russia sees Chinese Communist Party as template for governing

Clifford J. Levy / NYT — Sun, 18 Oct 2009 15:33:00 GMT

Moscow: Nearly two decades after the collapse of the Communist Party, Russia’s rulers have hit upon a model for future success: the Communist Party.

Or at least the one that reigns next door.

Like an envious underachiever, Vladimir V. Putin’s party, United Russia, is increasingly examining how it can emulate the Chinese Communist Party, especially its skill in shepherding China through the financial crisis relatively unbowed.

United Russia’s leaders even convened a special meeting this month with senior Chinese Communist Party officials to hear first-hand how they wield power.

Looking east: Russian Prime Minister Vladimir Putin (left) talks with Chinese President Hu Jintao in Beijing. Senior Putin aide Aleksandr D. Zhukov at a meeting with Chinese officials in the border city of Suifenhe said the accomplishments of China’s Communist Party in developing its government deserve the highest marks. Kyodo / Reuters

In truth, the Russians express no desire to return to communism as a far-reaching Marxist-Leninist ideology, whether the Soviet version or the much attenuated one in Beijing. What they admire, it seems, is the Chinese ability to use a one-party system to keep tight control over the country while still driving significant economic growth.

It is a historical turnabout that resonates, given that the Chinese Communists were inspired by the Soviets, before the two sides had a lengthy rift.

For the Russians, what matters is the countries’ divergent paths in recent decades. They are acutely aware that even as Russia has endured many dark days in its transition to a market economy, China appears to have carried out a fairly similar shift more artfully.

The Russians also seem almost ashamed that their economy is highly dependent on oil, gas and other natural resources, as if Russia were a Third World nation, while China excels at manufacturing products sought by the world.

“The accomplishments of China’s Communist Party in developing its government deserve the highest marks,” Aleksandr D. Zhukov, a deputy prime minister and senior Putin aide, declared at the meeting with Chinese officials on 9 October in the border city of Suifenhe, China, north-west of Vladivostok. “The practical experience they have should be intensely studied.”

Zhukov invited President Hu Jintao, general secretary of the Chinese Communist Party, to United Russia’s convention, in November in St Petersburg.

The meeting in Suifenhe capped several months of increased contacts between the political parties. In the spring, a high-level United Russia delegation visited Beijing for several days of talks, and United Russia announced that it would open an office in Beijing for its research arm.

Political stage: A woman at a polling station during regional elections in Moscow on 11 October. United Russia won the vast majority of contests. Sergei Karpukhin / Reuters

The fascination with the Chinese Communist Party underscores United Russia’s lack of a core philosophy. The party has functioned largely as an arm of Putin’s authority, even campaigning on the slogan “Putin’s Plan”. Lately, it has championed “Russian Conservatism”, without detailing what exactly that is.

Indeed, whether United Russia’s effort to learn from the Chinese Communist Party is anything more than an intellectual exercise is an open question.

But in recent years, Russia has started moving towards the Chinese model politically and economically. After the fall of the Soviet Union in 1991, Russia plunged into capitalism haphazardly, selling off many industries and loosening regulation. Under Putin, the government has reversed course, seizing more control over many sectors.

Today, both countries govern with a potent centralized authority, overseeing economies with a mix of private and state industries, although the Russians have long seemed less disciplined in doing so.

Corruption is worse in Russia than China, according to global indexes, and foreign companies generally consider Russia’s investment climate less hospitable as well, in part because of less respect for property rights.

Russia has also been unable to match China in modernizing roads, airports, power plants and other infrastructure. And Russia is grappling with myriad health and social problems that have reduced the average life expectancy for men to 60. One consequence is a demographic crisis that is expected to drag down growth.

The world financial crisis accentuated comparisons between the economies, drawing attention to Moscow’s policies. In June, the World Bank projected that China’s economy would increase by 7.2% in 2009, while Russia’s would shrink by 7.9%.

Politically, Russia remains far more open than China, with independent (though often co-opted) opposition parties and more freedom of speech. The most obvious contrast involves the Internet, which is censored in China but not in Russia.

Even so, Putin’s political aides have long studied how to move the political system to the kind that took root for many decades in countries such as Japan and Mexico, with a de facto one-party government under a democratic guise, political analysts said. The Russians tend to gloss over the fact that in many of those countries, long-serving ruling parties have fallen.

The Kremlin’s strategy was apparent in regional elections last week, when United Russia lieutenants and government officials used strong-arm tactics to squeeze out opposition parties, according to non-partisan monitoring organizations. United Russia won the vast majority of contests across the country.

Far behind was the Russian Communist Party, which styles itself as the successor to the Soviet one and has some popularity among older people. The Russian Communists have also sought to build ties to their Chinese brethren, but the Chinese leadership prefers to deal with Putin’s party.

The regional elections highlighted how the Russian government and United Russia have become ever more intertwined. State-run television channels offer highly favourable coverage of the party, and the courts rarely if ever rule against it. United Russia leaders openly acknowledged that they wanted to study how the Chinese maintained the correct balance between the party and government.

“We are interested in the experience of the party and government structures in China, where cooperation exists between the ruling party and the judicial, legislative and executive authorities,” Vladimir E. Matkhanov, a deputy in Russia’s Parliament, said at the Suifenhe meeting, according to a transcript.

United Russia praises the Chinese system without mentioning its repressive aspects. And the party’s stance also appears to clash with repeated declarations by Putin, the former president and current Prime Minister, and President Dmitri A. Medvedev that Russia needs a robust multiparty system to thrive.

The two endorsed the results of Sunday’s local elections, despite widespread reports of fraud, prompting opposition politicians to call their words hollow.

Sergei S. Mitrokhin, leader of Yabloko, a liberal, pro-Western party that was trounced, said the elections revealed the Kremlin’s true aspirations. And the China talks made them all the more clear, Mitrokhin said.

“To me, the China meeting demonstrated that United Russia wants to establish a single-party dictatorship in Russia, for all time,” he said.

Throughout recent centuries, Russia has flirted with both the West and East, its identity never quite settled, and analysts said that under Putin, the political leadership had grown scornful of the idea that the country had to embrace Western notions of democracy or governing.

That in part stems from the backlash stirred in the 1990s, after the Soviet fall, when Russia faced economic hardship and political chaos, which many Putin supporters say the West helped to cause.

Dmitri Kosyrev, a political commentator for Russia’s state news agency and author of detective novels set in Asia, said it was only natural that the Kremlin would cast its gaze to the East.

“When they discovered that there was a way to reform a formally socialist nation into something much better and more efficient, of course they would take note,” Kosyrev said. “Everyone here sees China as the model, because Russia is not the model.”

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Britain to send 500 extra troops to Afghanistan

AFP — Wed, 14 Oct 2009 12:25:00 GMT

London: British Prime Minister Gordon Brown announced Wednesday an extra 500 troops for Afghanistan, but pressed NATO allies to do their “fair share” in the increasingly deadly and unpopular mission.

The announcement, taking Britain’s force level in Afghanistan to 9,500, came as a new poll underlined growing public doubts about the eight-year-old Afghan mission, with one in three Britons saying troops should be withdrawn.

“We have agreed in principle a new British troop level of 9,500,” Brown said in a statement to the House of Commons. The Ministry of Defence confirmed this represented an increase of 500.

He stressed the increase was based on three conditions, including an Afghan government commitment to provide enough new troops to be trained and that units can be properly equipped for the task.

“Third, that our commitment is part of an agreed approach across the international coalition, with all countries bearing their fair share,” he told lawmakers.

“Britain supports (US commander) General (Stanley) McChrystal’s ambition to accelerate the growth of the Afghan security forces,” Brown added.

In a statement on Afghanistan and Pakistan, Brown also announced that Britain would provide an extra £10 million ($16 million, €10.7 ) in humanitarian aid for areas of Pakistan “liberated” from militants.

Britain currently has around 9,000 troops in Afghanistan, the second largest deployment after the United States. There have been 221 British deaths there since the war began in 2001.

The news is likely to be welcomed in the US, where President Barack Obama has struggled to persuade even Washington’s closest allies to dispatch more troops to Afghanistan amid spiralling violence and waning public support.

It comes as Obama holds in-depth talks with his war council Wednesday, the latest meeting on a grim assessment of the war by McChrystal, the top US and NATO commander in Afghanistan.

Obama said Tuesday he would conclude “in the coming weeks” whether to fulfil McChrystal’s request for reportedly up to 60,000 more troops to bolster the US effort.

In a solemn moment before announcing the new troops, Brown spent several minutes reading out the names of all 37 Britons who have died in Afghanistan since he last addressed the House of Commons in July.

Many were killed in the run-up to August’s presidential elections which were plagued by allegations of fraud. Preliminary results suggest Hamid Karzai will be voted back in.

Brown has been facing growing political pressure over the purpose, scope and resourcing of the British mission in Afghanistan in recent months.

In a highly controversial move, the former head of the army Richard Dannatt was last week named as an advisor to the main opposition Conservative party on defence — and could be made a minister if, as polls suggest is likely, they win a general election which must be held by next June.

A Populus opinion poll for the Times newspaper out Wednesday showed that public calls for British troops to pull out of Afghanistan have risen sharply as casualties mount.

Some 36% of voters now believe all British forces should be withdrawn, compared to 29% in mid-September.

Brown said the Afghan mission was vital to Britain’s security, since it prevents militants from using Afghanistan and Pakistan as a base to plot new attacks in the West.

“A safer Afghanistan is a safer Britain. A stronger Pakistan is a safer Britain,” he said.

“We must never again let the territory of this region, or any region, become a base for terror on the underground, the streets, the cities and airports of Britain.

“We must not permit it. We will not permit it. We have the right strategy, and we will see it through.”

EU for linking climate change, social disparity with India FTA

PTI — Tue, 13 Oct 2009 12:59:00 GMT

Brussels: With increasing pressure on European Union (EU) to stick to a rigid stand on linking climate change and social disparity with trade, the conclusion of talks on India-EU Free Trade Agreement is set to get delayed.

“I am fully aware of India’s problems. I come from Poland where there is a difference between EU stand and interests of the country’s industries but we need to move to discuss these issues,” member of European Parliament, Lena-Kolarska Bobinska, told Indian journalists visiting the EU headquarters.

She said the EU considered India an “absolutely crucial region” not only in terms of economy but also in terms of stablization of democracy.

But, there is a need to assess the impact of the FTA on the social groups of the country, she said.

The insistence of the 27-nation bloc would delay the conclusion of the negotiations launched in 2007 for signing an FTA which is aimed at removing duty and other barriers on the India-EU trade which aggregated $73 billion in 2007-08.

India’s Commerce Ministry has been strongly opposing linking the trade with social and climate change issues, arguing these are better left to the United Nations.

Bobinska said the EU Committee on environment would be meeting next week to articulate before European Parliament expectations on the issue of climate change.

Several rounds of negotiations have not resulted in a consensus on the level of trade to be covered under the pact.

Food prices to stay high, volatile: FAO

Silvia Aloisi / Reuters — Mon, 12 Oct 2009 14:30:00 GMT

Rome: Food commodities prices are likely to stay high and volatile in the medium term, while a repeat of the 2007-2008 price spikes is seen as a realistic possibility, the UN Food and Agriculture Organisation (FAO) said on Monday.

Between 2006 and 2008, international prices for basic food commodities shot up by 60% while grain prices doubled.

By mid-2008, food prices on international markets reached their highest level in nearly 30 years, causing riots and hoarding in some countries and sparking a drive by import-dependent rich nations to secure farmland mainly in poorer countries.

The food price spikes caused a sharp rise in the number of hungry people around the world to more than 1 billion this year.

While prices have fallen back since, they remain high and are not likely to dip below their 2006 level, FAO said in a report discussed at a forum of 300 agriculture and development experts in Rome on Monday and Tuesday.

“Available mid-term to longer-term projections ... indicate that prices may stay above pre-2006 levels, at least in the medium term,” the report said. Graphics published in the report showed prices for commodities such as wheat, rice, oilseeds, raw and refined sugar were expected to hold above pre-2006 levels through to 2018.

FAO, which is hosting a world food summit next month, said the global food commodities market was also likely to remain volatile “in the foreseeable future” and a new surge in prices like the one seen in 2007-08 was a “realistic possibility”.

“I would say it’s almost inevitable,” said Homi Kharas, a senior fellow on global economy and development at Brookings Institution and one of the panelists at the forum.

He said that the factors which led to the food price crisis last year - droughts, volatile energy prices, US dollar instability and market speculation - all threatened to push prices up again.

That helped keep the situation of supply and demand tightly balanced and vulnerable to even a single shock - be it a crop shortfall, commodity speculation or short-term oil price rises.

FAO said that while overall demand growth was forecast to slow further globally, demand for some income-sensitive products will grow faster.

Insufficient investment in productive capacity, and further demand growth for biofuels were also factors that could keep prices firm in the medium term.

FAO says the world needs to produce 70% more food by 2050, and invest $83 billion a year, to feed a growing population that is estimated to top 9 billion people by then.

Swine flu toll climbs to 4.525: WHO

AFP — Fri, 09 Oct 2009 19:26:00 GMT

Geneva: At least 4,525 people have died from swine flu infections since the A(H1N1) virus was uncovered in April, the World Health Organisation said on Friday.

This is an increase of 417 fatal cases from a week ago when 4,108 deaths were recorded, the UN health agency said in its weekly update of the pandemic.

Most deaths occurred in the American region, where 3,292 fatalities have been reported.

Some 890 people have died from the infection in the Asia-Pacific region, while at least 193 fatal cases have been recorded in Europe.

Eighty deaths have been reported in the West Asia while in Africa, 70 people have succumbed to the disease.