Incentives aimed at industry
Brazil on Tuesday unveiled an economic incentive package aimed at helping the country’s industrial sector increase its competitiveness. The package includes tax cuts, lower interest rates on credits granted to several sectors and measures to curb the strength of Brazil’s currency that makes its exports costlier and its imports cheaper. In launching the package, President Dilma Rousseff said the measures will protect local industries from the “predatory trade practices” of industrialized countries. Finance Minister Guido Mantega said the package would increase the country’s GDP this year by 4.5 percent. GDP grew 2.7 percent last year and 7.5 percent in 2010.
Daimler reaffirms forecast
Daimler AG is reaffirming its forecast that earnings will be steady this year even though its core Mercedes-Benz Cars unit saw deliveries rise in the first quarter. Daimler’s Mercedes-Benz Cars sold more than 340,000 vehicles in the January-March period — a 12 percent increase compared with a year earlier. Its trucks division saw sales rise 20 percent to 107,000. The company says it expects total unit sales to increase “significantly” this year and revenues to grow, but that it is still targeting last year’s level of pretax earnings, 9 billion euros (US$12 billion). Daimler says global car markets should grow by 4 percent this year.
Deficit depends on fuel price
The World Bank said Indonesia’s budget deficit may surpass 3 percent if there is no fuel price hike this year. Parliament has blocked the government’s plan to raise fuel prices by more than 30 percent this month and said it would allow a future hike only if the average price of Indonesian crude soars 15 percent above US$105 per barrel. In a report yesterday, the World Bank estimated that, with average oil prices of US$120 per barrel over the year, the deficit could rise to 3.1 percent if there is no adjustment to subsidized fuel prices.
China raises funds limit
China has nearly tripled the amount of money foreign institutions can invest in stocks, bonds and bank deposits to US$80 billion as it seeks to boost its capital markets. The China Securities Regulatory Commission announced late on Tuesday that the limit, which applies to selected overseas institutions, would rise from the previous limit of US$30 billion. The move follows a dismal year for China’s main stock index, which has been hit by fears of a slowdown in the world’s second-largest economy as demand from key export markets in Europe and the US shrinks.
AP’s losses level off
The Associated Press (AP) on Tuesday reported a loss last year as revenues fell for a third straight year, but signaled that it sees some improvement this year for the US news cooperative. AP, which has been battered by the woes of the news industry, said revenues last year dipped to US$627.6 million from US$630.5 in 2010, showing a steadier situation after a 10 percent drop in 2009 and 7 percent decline in 2010. Before taxes, AP said it lost US$23 million, compared with a US$22.5 million loss in 2010. After taxes, the loss amounted to US$193.3 million because under accounting rules it must establish a reserve against the future tax benefits for its losses.