India signs free-trade deal
Japan and India signed a free-trade pact yesterday under which the high-tech nation and the South Asian giant pledged to scrap tariffs on 94 percent of goods within a decade. Foreign Minister Seiji Maehara and Indian Commerce Minister Anand Sharma signed the deal in Tokyo, hoping it will boost two-way trade which totaled ￥900 billion (US$10.7 billion) in 2009 — less than 1 percent of Japan’s total foreign trade. It will help auto makers such as Suzuki by lifting tariffs on car parts shipped to its factories in India, and ease access for Indian generic drug makers to a lucrative market in fast-graying Japan. India — which has already signed a free-trade deal with South Korea, Japan’s export rival in autos and electronics, but not with China — will become Japan’s 12th free-trade partner.
Moody’s cuts bank ratings
Moody’s Investors Service cut its rating for five Danish banks, including Danske Bank A/S, after Denmark’s government allowed senior creditors to take losses in this month’s failure of Amagerbanken A/S. Moody’s reduced the long-term ratings of Danske Bank, FIH Erhvervsbank A/S, BankNordik P/F, Spar Nord Bank A/S and Ringkjoebing Landbobank A/S and kept the three former on review for a further possible downgrade, according to a statement yesterday from the New York-based rating company. The Feb. 6 failure of Amagerbanken A/S, the country’s fifth-biggest listed lender, marks Denmark’s eighth bailout of a local bank since 2008 and the first since the government on Sept. 30 ended a blanket guarantee of deposits and senior debt, leaving some creditors with losses. Moody’s also placed the long-term ratings of Nordea Bank AB’s Danish unit, Sydbank A/S and Jyske Bank A/S on review for possible downgrade.
Weidmann wins approval
Jens Weidmann, the chief economic adviser to Chancellor Angela Merkel, won coalition approval to become the youngest president of the nation’s central bank in its 53-year history, a person familiar with the discussions said. An announcement on the 42-year-old’s nomination was to be made as soon as yesterday, the person said on condition of anonymity because the decision has not yet been made public. “If Weidmann gets the Bundesbank job, then I think the odds for the ECB job move toward a non-German,” Erik Nielsen, chief European economist at Goldman Sachs Group Inc, said in a note yesterday. However, current Bundesbank President Axel Weber — who will remain in office until April 30 — will attend this weekend’s G20 meeting in Paris.
Exports gather pace
Spanish exports accelerated in the fourth quarter, offsetting weaker demand at home as the deepest austerity measures in three decades undermined economic recovery. Exports rose 10.5 percent from a year earlier, after a 9.4 percent increase in the third quarter, the National Statistics Institute in Madrid said yesterday. Household spending grew 1.7 percent from a year earlier after a 1.5 percent in the previous three months. Spain’s economy emerged from an almost two-year recession last year, just as the Socialist government started to trim public wages and cut benefits. While the measures undermined consumption at home, exports in the first 11 months of last year grew 14 percent from a year earlier, according to Eurostat.