Bank president gives advice
European Central Bank President Jean-Claude Trichet warned European nations in a newspaper interview yesterday not to rip up the rule books when launching emergency packages to save their economies. While refusing to comment on any specific country’s policies, he told the Financial Times that fiscal indiscipline could threaten already fragile economic confidence and increase nervousness about governments’ funding needs. “We would destroy confidence if we blew up the stability and growth pact,” which sets rules on public deficits and debt, he said.
Chair predicts falling sales
Volkswagen chairman Martin Winterkorn predicted world car sales would fall by up to 20 percent next year and said the industry would have to confront “painful” changes, a German newspaper reported on Sunday. Winterkorn said Europe’s biggest car maker would survive the crisis better than others “but the fall could be up to 10 percent for the Volkswagen group,” he told Suddeutsche Zeitung newspaper. He warned that world car industry could see sales fall by “almost 20 percent” next year. “The situation for us is not great but it is not radically bad,” Winterkorn was quoted as saying in advanced excerpts of an interview to be published today.
Forum to meet this week
The Financial Stability Forum group of regulators will meet this week in Hong Kong, where they will discuss the global economic crisis and G-20 proposals to prevent a recurrence of the financial turmoil. Finance and central bank officials and regulators from the Asia Pacific region, the Asian Development Bank and other members of the group will meet today and tomorrow, according to a statement by the organization. Officials will also discuss membership expansion, according to the statement. Leaders from the Group of 20 biggest developed and emerging economies last month set a March deadline for recommendations on strengthening accounting standards, derivatives markets and oversight of hedge funds and debt-rating companies.
Merkel holds summit
German Chancellor Angela Merkel, under fire over her reaction to the financial crisis, called together business leaders, ministers and experts in Berlin on Sunday to discuss ways of escaping the international recession. The time had come for “us to take joint responsibility, as the government cannot handle the economic situation alone,” Merkel told a press conference before the meeting. Merkel has made defending German jobs a top priority but increasing numbers have been lost in Europe’s biggest economy in recent weeks.
Citigroup inks Dubai deal
Citigroup Inc, the global bank that got a US$45 billion government bailout, “recently” arranged more than US$8 billion of financing for government-owned companies in Dubai. “This is in line with our commitment to the United Arab Emirates’ market in general, and reflects our positive outlook on Dubai in particular,” chairman Win Bischoff said in an e-mailed statement today. The Gulf region is among Citigroup’s “most significant markets” globally and the bank sees “opportunities across all of UAE’s financial sectors,” he said. Citigroup has been operating in the UAE since 1964 and is one of about 50 banks competing for local market share.