Firms charged over bribes
Four major insurance companies paid a broker tens of millions of dollars in hidden kickbacks in exchange for winning contracts with some of the largest US companies, California Insurance Commissioner John Garamendi charged on Thursday. A lawsuit filed in San Diego Superior Court names MetLife Inc, Pruden-tial Financial Inc, Cigna Corp and UnumProvident Corp. The suit also names Univer-sal Life Resources Inc, which brokers employee benefit plans and insurance coverage on behalf of companies such as Safeway Inc, Intel Corp, Northrop Grumman and other Blue Chip names. Garamendi said he has agreed to drop the charges against Universal Life, based in San Diego, in exchange for "full and timely" cooperation in the investigation of the four insurance companies.
China halts new ventures
China has suspended all new cigarette and tobacco foreign joint ventures, state media reported yesterday, raising doubts over a claim by British American Tobacco that it has approval to manufacture cigarettes in China. "The decision is made on the grounds that the Chinese tobacco market is saturated and it has surplus cigarette production capacity," Xinhua News Agency said. But the report said China would allow cooperation in upgrading technology, and in importing high-quality tobacco leaf, high-grade cigarette paper and other "necessary materials." China is the world's biggest tobacco market, with annual sales of about 1.8 trillion cigarettes -- or about 30 percent of worldwide sales.
S Korea's growth weakens
South Korea's economy achieved lower-than-expected growth in the three months to September as domestic demand failed to pick up the slack from weakening exports, the central bank said yesterday. Real GDP growth slowed to 4.6 percent year-on-year in the third quarter, down from 5.5 percent in the second quarter, the Bank of Korea said. GDP expanded 5.4 percent in the first half and 5.1 percent in the nine months to September. The bank said that the failure of a hoped-for recovery in domestic demand, coupled with slower growth in exports, weakened the third-quarter GDP growth rate. The trend will continue through the fourth quarter, the bank predicted.
AirAsia ready for Indonesia
Asia's best-known budget carrier, Malaysian-based AirAsia, could be ready for takeoff in Indonesia as early as January, a newspaper reported yesterday. The timing of the maiden flight of AirAsia Bhd's Indonesian joint venture, PT AWAir, would depend on when AirAsia completes a due-diligence review of the airline's financial details and finalizes the deal, The Star newspaper said, quoting the airline's executive director, Kamarudin Meranun. AirAsia is paying a token US$2 to buy 49 percent of PT AWAir, a debt-ridden Indonesian airline that suspended operations in March 2002. The Indonesian joint venture will be AirAsia's second overseas foray after Thai AirAsia, in which the Malaysian carrier also has a 49 percent stake. Thai AirAsia is 51 percent owned by Shin Corp, which is controlled by the family of Thai Prime Minister Thaksin Shinawatra. PT AWAir, using leased aircraft, used to fly from the Indonesian capital, Jakarta, to Denpasar in Bali, Surabaya and Medan.