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Wed, Feb 14, 2007 - Page 10 News List

World Business Briefs

AGENCIES

■ Trade

US trade deficit surges

The US trade deficit surged to a record US$763.6 billion last year owing to new highs for oil prices and the commercial shortfall with China, the government said yesterday. The Commerce Department said the December gap alone was US$61.2 billion, up from US$58.1 billion in November to the disappointment of Wall Street economists, who expected a figure of US$59.5 billion. The annual figure was up from US$716.7 billion in 2005, registering the fifth consecutive year of a record as oil prices struck new highs above US$78 per barrel midway through last year. The US deficit with China grew to a new high of US$232.5 billion last year, up from US$201.5 billion the year before.

■ Trade

Bush approves China sale

US President George W. Bush on Monday cleared the way for a private sector sale to China of high-tech products linked to its railway system and its testing of parts for Boeing aircraft. In a legally required ruling, Bush certified that the sale "is not detrimental to the US space launch industry" and "will not measurably improve the missile or space launch capabilities of the People's Republic of China." The move clears the way for the sale of 20 Honeywell accelerometers to be incorporated into railway geometry measurement systems for China's Ministry of Railways; and equipment and technology associated with the production and testing of composite components for Boeing commercial aircraft. The exports do not pose a threat to US national security or the US space launch industry and will not provide a direct or indirect benefit that improves measurably China's missile, space missile launch, or anti-satellite capabilities, a White House official said.

■ Communications

Hutchison shares plunge

Shares of Hutchison Telecommunications International Ltd (和記電訊) plunged yesterday after it agreed to sell its 67 percent controlling stake in Hutchison Essar India Ltd, one of India's leading cellphone companies, to Vodafone Group PLC. Analysts say the decline was expected, as investors took profits after the conclusion of the stake sale amid uncertainties over how the company will use the cash from the deal. "The debate now is whether they'll hold onto it and reinvest in other telco businesses or whether they'll pay it back up to Hutchison Whampoa," said Morgan Stanley analyst Rob Hart. Hutchison Telecom is a a holding company of Hong Kong-based conglomerate Hutchison Whampoa (和記黃埔). Hutchison Whampoa shareholders are unlikely to "see this cash directly," Hart said.

■ Aerospace

Boeing unveils KC-767

Boeing Co on Monday announced a newly designed KC-767 as its proposed aircraft for a US$40 billion Air Force contract competition to replace 179 refueling planes. The Chicago-based company said at a press conference held in Washington that it tweaked the design of its long-range 767 freighter plane to improve fuel efficiency, among other factors. Boeing is competing against Northrop Grumman Corp, which is expected to offer its KC-30, a modified Airbus A330, at a discounted price. At stake for both competitors is a multiyear contract to replace a portion of the military's older fleet of KC-135 aircraft.

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