Wed, Mar 14, 2012 - Page 10 News List

World Business Quick Take



Vekselberg quits RUSAL

Russian billionaire Viktor Vekselberg yesterday quit as chairman of the world’s largest aluminum producer, UC RUSAL, saying the heavily indebted company was in deep crisis after a long battle with fellow oligarch Oleg Deripaska. The resignation tightens Deripaska’s grip on RUSAL, but the company faces a struggle to recover because of a fall in global aluminum prices and its large debt, acquired a stake in Norilsk Nickel, the world’s largest nickel and palladium miner. “I regret to say at this time that RUSAL is in a deep crisis, caused by the actions of the management,” said Vekselberg, who has a 15.8 percent stake in the company along with his partners. In response, RUSAL issued a statement, accusing Vekselberg of failing to fulfill the role of chairman and indicating that he would have been removed in any case.


Tokyo can buy China bonds

Tokyo said yesterday it had won approval from Beijing to buy Chinese government bonds for the first time, in a move aimed at binding Asia’s two biggest economies and traditional rivals closer together. Tokyo was cleared to buy Chinese government bond issues worth US$10.3 billion, Minister of Finance Jun Azumi said in Tokyo. Under the deal, Beijing gave the nod for Tokyo to buy 65 billion yuan (US$10.3 billion) in Chinese public debt, but completing the purchase “will take several months” because of administrative requirements, he said. China has already been investing in Japanese government debt in an apparent bid to diversify some of its currency reserves — the world’s biggest — into yen amid concerns about Europe’s debt crisis and prospects for the US dollar.


Inflation rate falls again

The inflation rate unexpectedly fell for a second month. Consumer prices rose 2.5 percent from a year earlier based on EU methodology, compared with a 2.6 percent increase in January, Paris-based national statistics office INSEE said yesterday. Economists had forecast a 2.6 percent gain, the median of 18 estimates in a Bloomberg News survey showed. Prices rose 0.5 percent in the month after declining 0.4 percent in January.


Brazil urged to boost sector

Brazil’s National Confederation of Industry (CNI) on Monday called for the government to bolster the industrial sector, which has been reeling from the country’s economic slowdown and the rise of the real. “We cannot let the Brazilian industry collapse,” CNI president Robson Braga said in remarks released by the confederation. He urged the government to take measures, including hastening the delivery of environmental licenses and to introduce incentives to boot investment in infrastructure and reduce red tape.


Stress tests to be published

The Federal Reserve said it would release results tomorrow of its so-called stress tests of the nation’s 19 largest banks. The Fed conducts the tests on banks every year, but this is the first time since 2009 it will release its results to the public. Among the scenarios the tests imagine are 13 percent unemployment, much higher than today’s 8.3 percent, and a 50 percent drop in stock prices. The Fed can stop banks from paying stock dividends or buying back their own stock if they fail the test.

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