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World Business Quick Take

■ Retail
Tesco eyes US market
Tesco Plc, the UK's largest retailer, said it plans to enter the US next year as it seeks to challenge Wal-Mart Stores Inc in its home country. Tesco, based in Cheshunt, England, will open convenience stores on the West Coast of the US, the world's richest economy, Chief Executive Terry Leahy said in an interview yesterday. The outlets will be based on the Tesco Express format in the UK. "We'll open quite a few stores in 2007 and hope for pretty rapid expansion," Leahy said. "We hope we will be giving US consumers something new and different." Tesco, which controls 30 percent of the UK grocery market, is expanding abroad as it faces planning restrictions at home and calls by neighborhood store owners for its growth to be curbed. Tesco entered China in 2004 following Wal-Mart and Carrefour SA and now operates in 12 countries outside the UK.

■ Automobiles
Mitsubishi trims losses
Scandal-tarnished Mitsubishi Motors trimmed its losses for the quarter ended Dec. 31 compared to the same period a year earlier, although it continued to struggle to boost revenue. The Japanese automaker racked up a ¥4.3 billion (US$36 million) group net loss for the October-December period, much better than the ¥49.4 billion loss for the third quarter of 2004. Tokyo-based Mitsubishi Motors Corp has struggled for several years to restore its image and boost sales as it fought recurring scandals centered on repeated cover-ups of auto defects. Sales for the October-December period totaled ¥538 billion (US$4.6 billion), down 2 percent from ¥547 billion the previous year, but the automaker managed to boost profitability during the quarter. Mitsubishi Motors said in a statement that lower advertising costs in the US and Europe as well as the weaker yen lifted profits.

■ Trade
EU reaches compromise
The European Parliament's two largest political groups reached a compromise on Wednesday on a draft law aiming to clear obstacles preventing business from offering services in another EU country, tabling joint amendments to the landmark bill. The conservative European People's Party and the Socialists, who have a majority in the 732-member chamber, watered down the contentious "country of origin" principle, whereby European companies working in other EU member states would be able to apply laws and work rules applicable in their homeland. Under the compromise proposal, the services market will open up, with the 25 EU member states being obliged to ensure free access to and free exercise of a service activity in its territory.

■ Interest rates
S Korea raises rate target
South Korea's central bank yesterday raised its key interest rate target for this month to 4 percent from 3.75 percent in a bid to stem inflationary pressures amid a solid economic recovery. The Bank of Korea forecast the country's economy would grow 5 percent this year amid signs of a strong recovery and increased consumer spending. Last month, the bank held the key inter-bank overnight call rate steady, while raising concerns over existing uncertainties in the market, including the won's strength against the dollar. "There are latent inflationary pressures due to the economic recovery and persistently high oil prices," the central bank said in a statement. The central bank chief said South Korea is on a recovery track.

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