GDP growth slows
The Nordic country’s economy grew at the slowest pace in three-and-a-half years in the third quarter, less than forecast by economists, as exports declined and growth in consumer spending stalled. GDP grew 0.1 percent from the previous three months, when it expanded a revised 0.5 percent, Helsinki-based Statistics Finland said on its Web site yesterday. The median estimate of six economists in a Bloomberg survey was for growth of 0.2 percent. Annual economic growth slowed to 1.3 percent from a revised 2.5 percent. Consumer spending, which has so far helped Finland’s economy to weather the impact of the US-led financial crisis, stalled in the third quarter, declining 0.1 percent from the previous three months. Exports slid 3.4 percent over the same period as recession in the euro zone and the US undermined demand.
Loan guarantees considered
The central government could grant its central bank powers to guarantee interbank loans in a bid to encourage more takers for the government’s banking rescue plan, media reports said yesterday. Bundesbank president Axel Weber proposed the idea to the government, the financial daily Handelsblatt reported, citing sources close to both the central bank and the government. A working group had been set up inside the central bank to study the feasibility of the project, a Bundesbank spokesman told the paper. The weekly news magazine Der Spiegel reported that the role of guarantor might be carried out either by the Bundesbank or by the KfW bank, the state’s financial arm. But a government source told the paper the solution would only be a temporary one.
Ford executives laid off
The Philippine branch of Ford Motor Co has laid off 30 executives in a cost-cutting measure in the face of the global financial turmoil, a company official was cited as saying yesterday. Ford Philippines group president Rick Baker was quoted in the Manila Standard newspaper as saying the layoffs, which include three vice-presidents, were equivalent to 15 percent of the company’s corporate workforce in the Philippines. The move affects both Ford Philippines and its affiliate Mazda Philippines, the newspaper said. Ford and Mazda would save between 5 million and 7 million pesos (US$102,000 to US$144,000) a year through the retrenchment, Baker said. “We are implementing this realignment to have a much leaner and efficient workforce,” Baker was quoted as saying.
Account surplus plunges
The country’s current account surplus plunged 56.5 percent in October from a year earlier as the financial crisis drove down exports, official figures showed yesterday. Asia’s largest economy posted a surplus of ¥960.5 billion (US$10.3 billion) in its current account, the broadest measure of trade in goods and services, finance ministry data showed. In the midst of its first recession in seven years, the Asian giant ran up a deficit of ¥131.9 billion in the balance of trade in goods and services, reversing a year-earlier surplus of ¥96.1 billion. In goods alone, its trade surplus tumbled 87.2 percent from a year earlier to ¥145.8 billion. Exports slid 7.3 percent to ¥6.59 trillion on falling shipments to the US, the EU and the rest of Asia. Imports rose 8 percent to ¥6.45 trillion, inflated by high oil and gas costs.