August 2003, Issue 21
 
 
 
  The Shanghai Cooperation Organization (SCO) Begin Anti-terror Maneuvers in Kazakhstan
Megawati Calls for Asean Security Grouping
Rethinking Nuclear Strategy
Pacific Nations Urged to Collectively Tackle Security Threats
Demographic Changes Challenge Asia's Education Policies, Says ADB's Key Indicators
Asia Pacific Network Information Center Policy Meeting Opens in Seoul
Bush to Push Free Trade in Asia
Us Human Trafficking Report Faults Georgia, Kazakhstan, Turkey and Uzbekistan
Successful Doha Round Essential to World Economy
Six-Way Nuclear Talks Set to Start in Beijing
 
  CHINA: Senior CPC Leader Urges Promoting Social Sciences
CPC Central Committee Plenum Scheduled for October
NPC to Discuss Key Law
Call for New Interconnection Policy
Re-employment Higher on Agenda of Chinese Government
Chinese Government to Rationalize Auto Sector
HK to Conduct Article 23 Consultation in Sept
China Makes Most Marriages Easier
China Redefines Seven Criminal Charges
New Law to Boost Govt Supervision of Bank Risk Management
Bill Introduces Administrative Licensing Hearing
JAPAN: Drafter of SDF-Iraq Law Gets Top Bureaucratic Job
White Paper Cites Need for Missile Defense
Report: Japan Seeks Missile System
Farm Policy May Switch from Defense to Offense Rising IncomesiIn Asia Mean Expensive Japanese Agricultural Exports Now More Affordable
Agency to Seek 140 Billion Yen for New Missile Defense System
Japan Ministry Seeks $1 Billion for Missile Defense
SOUTH KOREA: Assembly Passes Work Permit Bill
Interest Rate Unchanged
Assembly OKs Cut in Military Service
Consumer Protection Bill to Be Submitted
Ministry Doubles Budget for the Green School Program
5-Day Workweek to Begin Next July
 
  INDONESIA: House OKs Constitutional Court Bill
Govt Drafts Law on Public Sector Procurement
House Set to Discuss 30 Bills Next Session
MYANMAR: National Tuberculosis Programme Coordinated
MALAYSIA: Cabinet May Ratify Tobacco Control Treaty
Ministry to Curb Wildlife Smuggling
Amendment Allows Party to Set Up Sub-Branches
PHILIPPINES: Guidelines to Avoid SARS Return Issued
House OKs 52 Socio-eco Measures
Bicam OKs Dual Citizenship Bill
THAILAND: PM Issues Surprise Anti-terror Decrees
Move to Repeal Legislation
VIET NAM: President Lauds Justice Ministry Reform Plan
 
  INDIA: Govt Not to Adopt IPO as Divestment Policy
Govt Okays Delhi Statehood, Bill in Monsoon Session
Vajpayee Invites Pakistan to Join Peace Efforts
Cabinet Approves India's Deals with China
SRI LANKA: Land Ownership Act Receives Cabinet Approval
MALVIVES: Cabinet Considers Some Bills the Government Intends to Propose to Parliament
NEPAL: Cyber Law Soon - Finance Minister
PAKISTAN: Musharraf Vows Kashmir Issue Will Not Be Sidelined
Pak Following Deregulated Market Lead Policy
 
  ARMENIA: Government Approves Antipoverty Program
BAHRAIN: Free Health Check-Up Is Offered
GEORGIA: Parliament Again Fails to Pass Election Law
IRAQ: U.S. President Renews Sanctions on Iraq
IRAN: Parliament Passes Legislation on Campaign Against Money Laundering
KYRGYZSTAN: Struggle to Stem Smuggling
New Kyrgyz Labor Code Nears Completion
KAZAKHSTAN: President Has Approved the Government Programme for 2003-2006
TURKMENISTAN: People's Council Becomes Highest Legislative Body
 
  AUSTRALIA: New Forum Leader Reveals Policy
Call for EU-Style 'Pacific Community'
PM Pushes Joint Pacific Police Force
Howard Shifts Focus to Asia
PM to Lay Down Law on Solomons Corruption
FIJI: New Constitution on the Way: Kaitani
NEW ZEALAND: Government Plans Seabed Law by End of Year
Right-to-Die Law Lost in Narrow Vote
Clark Rules Out Private Ownership of Beaches
Job Law Backlash Expected
Govt Sets Limits for Tertiary Education Fees
PNG: Death Penalty Considered
 
  Top Parliamentarians of 37 Nations Set Meet in Manila
Asia's School Systems Need to Adjust to New Global Economy, Says ADB's Key Indicators
APEC Leaders to Promote Reform, Jobs at Oct. Meet
 
  CHINA: Anti-piracy Officials Enjoy More Authority
Reforms Made on Local Administrative Approving System
Democracy Grows with Rural Autonomy
Shanghai Government Agencies to Restructure
HK Gets New Principal Government Officials
Municipal Public Service Sector Opening Up
Beijing Women Officials 'Hold Up Half the Sky'
11 Senior Officers Fired in Push to Improve Police Image
New Committee Launched to Standardize Industry
An Open Road to Government Leadership
Judiciary and Legal Experts Meet to Discuss Curbing Corruption
More Farmers Needed in Public Service
Public Bidding to Purchase Medical Equipment
China Ups Anti-Graft Fight
Chinese Bank Staff Sentenced to Death for Embezzlement
Mainland Won't Set Limits on Taiwan Election, Official Says
Chinese Court Unveils 23 Reform Measures
JAPAN: Koizumi Says Reformers to Make Up New Cabinet
Foreign Ministry Fires Yet Another Corrupt Official
Government Workers Face Pay Cuts
Mitsuzuka to Retire from Politics
Eight to Vie for Saitama Governorship
Foreign Ministry Reports on Recruitment Reforms
SOUTH KOREA: Agency Provides Advanced e-Customs Services
NK Holds General Elections
Customs Service Implements Volunteer Customs Agent System
FSS Expands Statistical Service for Public
Arrest of Kwon to Speed Up Political Reform
Hopeful Steps for Local Autonomy
Government to Present Its Innovative Procurement System at APEC Meeting
Female Named for Constitutional Court
Ministry Files Report on Operation of Government Funds
Roh to Accept Choice of Justice Candidate
President Pledges Labor Reform
Roh Names Professor Audit Agency Chief
 
  INDONESIA: MPR Urged to Campaign Against Corruption
House, Govt, MA Rush to Select Constitutional Court Judges
RI Establishes Constitutional Court
Civil Servants Anxious Over Pay Cut Plan
MALAYSIA: Government Steps Up War Against Corruption
Faster CFs from October
PHILIPPINES: Corpus Named Chief of AFP Civil Relations Service
Promoting Good Governance in the Philippines' Restructured Power Sector
Anti-corruption Task Forces in AFP Formed by Arroyo
SINGAPORE: Prime Minister to Resign
THAILAND: `On Way to One-Party Govt'
Govt Committed to Saving Forests
Education Reform: Lacklustre Report Card
Government Urged to Shun New Pacts
VIET NAM: Govt Wage Reforms Aim to Boost Minimum,Incentives
MoT Plans Big Spend for Exports
 
  INDIA: Even Bihar's Ministers Go Without Salaries
President's Awards for CBI Officials
Law Commission Wanted Change in No-Confidence Rule
New AIPJD State Chief to Be Named Soon
SRI LANKA: Appointment to Public Utilities Commission
SRI LANKA: Govt. Will Free Public Service from Political Interference - G.L.
NEPAL: Govt. Forms Inquiry Commission
Bribery Charge Against Govt. Official
PAKISTAN: Appointment of Governor President's Privilege
Owais Ghani Nominated Governor
Sindh Govt. Sets Up Investment Board
Govt Is Trying to Strengthen the LG System: PM
Ministerial Body Formed
 
  AZERBAIJAN: President's Son Appointed Premier
Ilham Aliyev's Appointment as Azerbaijan's PM Sets Stage for Dynastic Transition
BAHRAIN: Bid to Strip MP of His Immunity
IRAQ: Governing Council Names Constitutional Committee
KAZAKHSTAN: New National Coordinator for the Issues of Human Trade
TURKMENISTAN: Supreme Authority Becomes Fourth Branch of Power
 
  Pacific Leaders Pick Australian to Head Regional Group
AUSTRALIA: Australia Has New Governor-General
Government Services Swell
Govt Comms Spend to Skyrocket
FIJI: Prime Minister Under Intense Criticism over Cabinet
FIJI: Qarase Sets Terms for Multi-Party Cabinet
GUAM: Senator Jailed for Corruption
NORTHERN MARIANAS: Senator Gets Five Years for Nepotism
NAURU: Ping Pong Presidency
NEW ZEALAND: Public Servant Sacked over $1.9m Fraud Allegations
Key Gets National's IT Role
PNG: Cabinet Shuffle
PNG: PM Offended by 'Failed State' Connotation
SOLOMON ISLANDS: Government Backbencher Alleges Corruption
TUVALU: Prime Minister Waiting for the Numbers
 
  APEC SME Ministers Call for Greater Networking Between Business, Government, Trade Promotion Authorities and Banks
ASEAN Plus Three Mechanism Boosting Regional Economy: Chinese Official
Closer APEC-World Bank-ADB Cooperation to Address Joint Economic Growth and Development Goals
 
  CHINA: Government to Adopt International System of Measuring GDP
Private, Foreign Companies Urged to Allow Trade Unions
Chinese Officials Receive Training in Harvard
Luo Gan Calls for Better Grassroots Development
Net Ready E-Business Seminar Series to Be Introduced
WHO to Train Thousands of Chinese Medical Workers
Academics, Government Linked by New NGO
JAPAN: Government Plans Town Meetings
New Ministry Policy Takes One-on-One Approach
SOUTH KOREA: Ministry Reviews Reform Efforts at Government Affiliate Organizations
Labor Participation in Management - Hyundai Motor's Decision Stirs Up Business Community
Ministry to Expand Steps to Induce Foreign Technical Brains
New Foreign Worker Employment System to Be Introduced
 
  INDONESIA: Immediate Land Reform is a Must :
MYANMAR: National Workshop on Development of Enabling Policies for Trade and Investment in the IT Sector Opened:
MALAYSIA: Move to License Financial Planners:
Penang Offers Expertise on Water Management:
Speeding Up Commercial Cases:
Officers to Train at Britain Top Law Centre:
PHILIPPINES: SSS Opens Special Financing Facility for Small Enterprises:
SINGAPORE: Wages Need to Be More Flexible and Tied to Performance:
 
  INDIA: PM Promises Quota for Upper-Caste Poor
Govt Toughens Stance Against Misuse of ISI Mark
PAKISTAN: Public-Private Sectors Partnership Stressed
Ministers' Performance Reviewed
 
  KAZAKHSTAN: Civil Forum to Take Place in Kazakhstan
TAJIKISTAN: Training for Servicemen of Defense Ministry on De-Mining Methods Begins
U.S. Embassy Supports Democratic Initiatives in Tajikistan
 
  AUSTRALIA: ACCC Ready to 'Out' Firms for Violating Codes of Conduct
NEW ZEALAND: Auckland Regional Council to Review Rating System
Ministry Focuses on Fraud Prevention, Spokesman Says
Govt Sets Up Integrated Approach to Work-Life Balance
 
  UNDP Report Ranks Pacific Island Nations
Expert Group Meeting on Regional Roadmap Towards Information Society for Asia and the Pacific and Fifth Regional Interagency Working Group Meeting on ICTUNCC, Bangkok, 13-15 August 2003
Asia Looks to China for Growth
Asian Governments Urged to Fight AIDS
Demographic Changes Challenge Asia's Education Policies, Says ADB's Key Indicators
Health Experts to Gather in Vietnam in Oct to Deal with SARS Recurrence
Transitional Challenges in Southeast Asia: News Analysis
 
  CHINA: IT Growth Bullish
Two-city Trade Zone Proposed
Haidian District Pioneers in E-government Development
Online Business Hits Record
Investment in Southern Taiwan Science Park Exceeds Us$32 Bln
Nine Provinces Plan Vast Economic Zone
Nearly 50 Pct of Taiwanese Use Broad-Band Internet Connection
China to Launch Nationwide Health Services Survey
New List of Top 500 Chinese Firms Announced
JAPAN: Broadband Users Reach 10.9 M
Japanese Birthrate Hits Record Low
SOUTH KOREA: Seoul Picks 10 High-Tech Areas as Growth Engines
 
  INDONESIA: Government Releases Post-IMF Economic Reform Blueprint
MALAYSIA: E-passport for Thais Planned
Changes in Schools Likely
Silverlake Shares K-economy Vision
PHILIPPINES: Nat'l Elearning Conference Opens at Manila Hotel
Economic, Population Growths Seen Pulling Up RP's Electricity Demand
7 Women Cited as East Asia Peace Awardees
SINGAPORE: Online University Group Spends S$50m to Set Up Asian HQ in Singapore
Singapore Car Owners Can Now Renew Road Tax Online
Singaporeans Can Remain Upbeat About The Economy as It Globalizes
IE Singapore's Hub Development Schemes Draw 18 More Global Firms
IDA Sets Up E-Supply Chain System to Cut Business Costs
Starhub to Charge "Surf for Free" Internet Service
THAILAND: Bangkok, Seoul Team Up on ICT
VIET NAM: All Communes to Have Power by 2010
VN Urged to Hasten Reforms to Join WTO
Strategy Ushers in IT Competition in VN
 
  INDIA: Infrastructure Critical for Poverty Reduction
Net Policing Comes to India
Mumbai Is India's Most Expensive City: Survey
India 5th Emerging Retail Economy: Knight Frank
Kolkata Ready to Take on London, Munich
SRI LANKA: Commercial Bank's 24-Hour 'E-Seva' Facility for E-Banking and Info
Maldives' Population to Exceed 293,000 by 2005
NEPAL: Govt. Website on Peace Talks
Nepal Nears WTO Membership
PAKISTAN: IT Sector Has Great Potential for Investment
SBP to Build Strong Database to Check Fraud and Danger of Risks in E-Banking
Internet Services: Accord Signed
 
  AFGHANISTAN: Afghanistan Uses Reconstruction Trust Fund to Address Priorities
IRAN: Greatest Digital Library Becomes Operational
KYRGYZSTAN: Kyrgyzstan Joined the Visa International Payment System
KAZAKHSTAN: The First Oil Export from New Facilities Commissioned at Karachaganak
Kazakhstan and Singapore Have Common Interests in Information Technologies
TAJIKISTAN: The Main Library Will Be Computerized
UZBEKISTAN: Slow Pace of Computerization Criticized
 
  AUSTRALIA: Howard Says Bush Up to Scratch on Telecommunications
Government Signs Security Deal
FIJI: Suicide Rate Amongst World's Highest
FIJI: 30% of Fiji in Poverty
New Zealand: Unemployment Hits 16-Year Low
DHBs Report $185m Deficit
Govt Puts $3.5 Million into New Biosecurity Strategy
 
  Stable RMB Exchange Rate Benefits World Economy
Progress Made on Asian Bond Market Initiative: Asean Plus Three
ASEAN Ministers Adopt Plan for Regional Financial Integration
Asian Bond Fund Not Just A Pipe Dream
 
  CHINA: Credit System Monopoly Fear Rises
WB Official: Calls to Appreciate RMB 'Groundless'
HK Banks to Open RMB Services
Shanghai Bank Launched Rate Monitoring System
Banking Watchdog to Set New Capital Adequacy Standards
Central Bank in China Raises Reserve Requirement
JAPAN: Budget Cuts Take Back Seat to Electioneering
Banks Fail to Lift Small-Firm Lending
31 Tokyo Banks Taxed 92.4 Billion Yen
Finance Ministry to Cut Loan Rates
Major Banks Trying to Track Down and Terminate Loan Shark Accounts
SOUTH KOREA: Banks' Bad Loan Ratios Surge in First Half
Foreign-owned Stocks Account for 37.5 % of Korean Bourse in July
KEB Forms BESETO Banking Alliance
Seoul Falls Behind Tokyo, Shanghai as Financial Hub
Tax, Social Security Contributions Hit Record High of 28% of GDP
 
  INDONESIA: Govt Insists on Maintaining High Forex Level
Belt-Tightening Measures, Subsidy Cuts Seal New Budget
Balance of Payment to Go into Negative After Exit From IMF
PHILIPPINES: Domestic Banks Step Up Efforts to Reduce Bad Loans Portfolio
BSP Eases Lending Among Banks Using Foreign Securities
THAILAND: Thailand Far From Debt-free
VIET NAM: Govt Can't Guarantee All Bank Loans
PM Approves Stock Market Strategy
State Bank, World Bank Sign $100m Worth Credit
 
  BANGLADESH: T-Bills Fall Due to Low Money Rates
INDIA: Tax Collection Plan Delayed Yet Again
RBI Intervention Halts Rupee Slide
SRI LANKA: Central Bank Lowers Policy Interest Rates
PAKISTAN: Export Finance Rate Cut to 3pc
State Bank Issues Guidelines-Risk Management
 
  IRAN: Central Bank Issues Participation Bond
KYRGYZSTAN: Kyrgyzstan Gives Go-Ahead to Leasing
KAZAKHSTAN: Government Fund to Finance the Elimination of Disasters
TAJIKISTAN: World Bank to Provide Second Part of Credit for Tajikistan
UZBEKISTAN: Top Banker Confirms Currency Convertibility on Track
 
  AUSTRALIA: Companies Face Audit Blitz
Rate Cut Fades as Investment Surge Nears $7bn
Pacific-Wide Currency 'Unlikely'
NEW ZEALAND: Government to Examine Taxation Loophole
Retail Sales Surprise Economists
Govt to Focus on Debt Level - Cullen
PNG: Govt to Raise Income Tax
 
  Asia-Europe Meeting (ASEM) Grant to Boost Productivity of Private Firms
 
  CHINA: Private Higher Education Comes of Age
State Shares Sold in Shenzhen
State-owned Hospitals in China to Embrace Market
Gov't-run Press in China Faces Shake-up
Think Tank: No Haste for Private Banks
World's Largest, U.S. Public Asset Management Company to Invest in Guangxi
China Breaks Up Power Monopolies to Form Six New Areas
Guangzhou's Private Firms Play Bigger Role
JAPAN: Koizumi Denies Postal Plan Report
Japan Allows Private Firms to Set Up Derivatives Markets
Kodak to Move All Digital Camera Operations to Japan
Japan Highway Launches Panel on Privatization
SOUTH KOREA: Ministry Approves Five Private-sector Construction Plans
 
  MALAYSIA: Private Sector Not Keen on Local Graduates
PHILIPPINES: OPIC Sets Transco Privatization as Pre-Condition to $250-M NPC Loan
THAILAND: Private Sector Has Role to Play
MWA Corporatisation Proposal Under Study
Council Against Privatising National Power Grid, Dams
 
  BANGLADESH: Higher Private Sector Bank Credit Leads to Increase in Real GDP
Private Varsities
Govt to Encourage Private Sector Initiative in IT Sector
INDIA: Financial Bids for Hind Copper Selloff by Sept
MALDIVES: Private Sector Will Be Invited to Develop Housing in Hulhumale
New Private Airline to Take Off Next Month
PAKISTAN: 80 % Banking Assets to Go Private with SBP Monitoring
Govt Will Not Privatize NBP: Shaukat
PC Invites EOI from Consortiums-Investment Banks for Privatization of National Refinery Ltd
Privatization of PSO, PTCL, HBL on Schedule
PTCL Bidders Asked to Start Due Diligence
 
  ARMENIA: Health Minister Suspends Hospital Privatizations
GEORGIA: Sale of Georgian Energy Company Shares Sparks Controversy
KAZAKHSTAN: Kazakhstani Property on Lssyk-Kool Lake
 
  AUSTRALIA: Private Power to Save State from Blackouts
Costello Admits Long Road to T3
NEW ZEALAND: Tranz Rail Board Rejects Toll Bid
Race to Buy National Bank Gets Serious
NZ Reserve Gets Power over Bank Ownership Changes
Private Beds Could Cure Crisis
PNG: Privatization K200 Million on Line

The Shanghai Cooperation Organization (SCO) Begin Anti-terror Maneuvers in Kazakhstan

Chinese senior officers said Wednesday that the large-scale joint anti-terrorism exercise conducted by the member countries of the Shanghai Co-operation Organization (SCO) will improve their ability to co-ordinate their fight against terrorism and help guarantee regional security and stability. They made these remarks in Kazakhstan's border city of Ucharal where the joint manoeuvre started yesterday. Lieutenant General Li Qianyuan, head of the Chinese military delegation and Commander of the Lanzhou Military Command, said in an interview that the Chinese army will exchange anti-terror experience with troops of Russia, Kyrgyzstan, Tajikistan and Kazakhstan, and that they will discuss ways to work together to fight international terrorism. The high-level military exercise shows that the SCO member states take the same stand and have the same determination to fight terrorism, separatism and extremism, Li said. He also said it is an important for the SCO states to step up military co-operation, to further foster mutual trust among their armed forces, and to strengthen regional co-operation against terrorism. The Chinese Government stands firmly against terrorism of all kinds, and calls for closer international co-operation and removal of the roots of terrorism, Li said. He added that the exercise displays again China's determination and confidence in the fight against terrorism. Lieutenant General Qiu Yanhan, commander of China's Xinjiang Military Command, said that a joint command staffed by military experts and officers of the five countries has been set up for the exercise. Qiu expressed his belief that the manoeuvre, the largest since the establishment of SCO, will contribute to increasing co-operation and co-ordination of activities in fighting terrorism. An official who is in charge of the foreign affairs office of China's Ministry of National Defence said it is the first time for the People's Liberation Army of China (PLA) to take part in such a large-scale joint anti-terror exercise. This exercise represents one of the effective ways for member countries to carry out military exchanges and co-operation. The official said that during the exercise, the leaders, commanders and soldiers from member countries would co-operate closely. It was also a chance for the PLA to display the calibre of its military. He believes that the exercise will promote understanding, friendship, co-operation and development between the PLA and military forces of the other member countries. The SCO was formed in June 2001 by China, Kazakhstan, Kyrgyzstan, Russia, Tajikistan and Uzbekistan. Following the success of a Sino-Kyrgyzstan joint anti-terror exercise held last year, the defence ministers from the five member countries of SCO signed, at the summit held in Moscow last May, a memorandum on conducting this joint anti-terrorist military exercise. Set up in Shanghai on June 15, 2001, the SCO groups China, Russia, Kazakhstan, Kyrgyzstan, Tajikistan and Uzbekistan. The SCO evolved from the initial mechanism of "Shanghai Five," which was officially launched in 1996. Five years later, to meet the demands of regional and multilateral cooperation due to changes in the international and regional situation, leaders from "Shanghai Five" plus Uzbekistan signed the Declaration of the Shanghai Cooperation Organization, officially inaugurating the SCO. The birth of the SCO, a significant development in modern international affairs, brings about a new security concept featuring mutual trust, disarmament and security cooperation. It also advocates new state-to-state relations and a new regional cooperation mode, deepening military trust and cooperation and enhancing cooperation in the fight against the "three evil forces"of terrorism, separatism and religious extremism. The SCO aims to strengthen mutual trust and good-neighborly andfriendly relations among member states, encourage further effective cooperation in various fields, jointly ensure regional peace, security and stability, and help create a new international political and economic order featuring democracy, justness and rationality. SCO heads of state meet once a year and heads of government meet on regular basis. At the St. Petersburg SCO summit in June 2002, the six leaders signed the Charter for the Shanghai Cooperation Organization, which clearly defines the principle, organization and operation of the six-nation organization. They also signed an agreement on the establishment of an anti-terrorism agency in the region and the declaration of presidents of the SCO members. On May 29, 2003, leaders of the SCO issued a joint declaration in Moscow, pledging enhanced cooperation in politics, economics and trade, and culture. On Oct. 10-11, 2002, the Chinese People's Liberation Army and the armed forces of Kyrgyzstan held a joint anti-terror military drill on the border areas of the two countries. It was the first time for China to hold cross-border military exercises and also the first bilateral anti-terror exercises conducted by members of the SCO.

From http://english.peopledaily.com.cn/ 08/06/2003

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Megawati Calls for Asean Security Grouping

JAKARTA: In her first public comments since the devastating car bomb at J.W. Marriott Hotel here, Indonesian President Megawati Sukarnoputri said the blast shows that current international efforts to fight terrorism are inadequate. She said Asean must evolve "into a full-fledged security community'' to fight terrorism. "It has become clear that no single country or group of countries can overcome this threat alone,'' Megawati told a conference marking Asean's 36th anniversary. She said the proposal for Asean's enhanced security role - which has traditionally limited itself to promoting economic ties between its 10 members - would top October's regional summit in Bali. "Asean needs to grow into a full-fledged security community,'' Megawati said. "This does not mean a defence or military alliance, but a more comprehensive political co-operation in which they share responsibility in responding to threats to regional harmony and security.'' Her remarks came at the end of a week marked by the bombing of the J.W. Marriott Hotel and a Muslim militant sentenced to death after being found guilty of planning last year's attacks on Bali, which killed 202 people - mainly foreign tourists. Both attacks have been linked to Jemaah Islamiah, an al-Qaeda-linked terrorist group operating in Southeast Asia. Its goal is said to be the creation of an Islamic state incorporating Indonesia, Malaysia, Singapore and Brunei, along with parts of Thailand and the Philippines. Scores of Jemaah Islamiah operatives have been arrested in the past 18 months, but many of its leaders remain at large. Megawati said threats posed by terrorism and other forms of transnational crime had become acute in recent years. "Regional plans of action to tackle such problems ... suddenly appear inadequate in the face of the cataclysms like terror attacks in the United States, in Bali, and a just few days ago in the Marriott Hotel in Jakarta,'' she noted. To confront the new threats, Asean's ongoing efforts for economic integration must be expanded to provide a "balance between economic co-operation and politico-security co-operation,'' Megawati said.

From http://www.aseansec.org/ 08/09/2003

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Rethinking Nuclear Strategy

KUALA LUMPUR - On Aug. 6, peace activists from around the world flocked to Hiroshima, Japan to pray for peace and remember those who died when the first nuclear bomb was dropped on that city 58 years ago. More subdued ceremonies marked the anniversary of the second, and we all hope last, use of nuclear weapons in anger three days later in Nagasaki. Sandwiched in between these two dates was a "secret" conference in Omaha, Nebraska where senior U.S. Defense Department officials reportedly met with nuclear weapons specialists to discuss ways of upgrading America's aging nuclear arsenal. While one can argue that there is never a good time to discuss the use of nuclear weapons, the Pentagon's timing of this event underscores and reinforces the impression around the world of U.S. callousness toward the views and feelings of others. These views have been very much in evidence at this year's annual Asia Pacific Roundtable in Kuala Lumpur. Speaker after speaker, including many who have traditionally been supportive of Washington and still favor a continued U.S. military presence in the Asia-Pacific region, condemned U.S. "unilateralism" and "arrogance." While some of the accusations are emotional and do not stand up to the facts - or overlook the reality that all nations, when nation interests appear at stake, act unilaterally - the bottom line remains: the Bush administration has a serious image problem which it appears intent on exacerbating. Given its "hyperpower" status, many argued, Washington no longer is concerned about what others think. Multilateralism, American-style, means "get on our bandwagon or get out of the way." Washington sees itself as a primary proponent of nuclear non-proliferation. Its current standoff with North Korea is aimed, first and foremost, at stemming the development and potential use or export of weapons of mass destruction (WMD). Washington, along with the international community in general, demands that Pyongyang rejoin and honor its commitment to the Nuclear Non-Proliferation Treaty (NPT). Yet Hiroshima mayor Tadatoshi Akiba says that the NPT is "on the verge of collapse," not because of North Korean actions but because the U.S. "appears to worship nuclear weapons as God." Mayor Akiba described U.S. policy as "openly declaring the possibility of a preemptive nuclear first strike." To my knowledge, the U.S. does not have, and has never professed to support a "preemptive nuclear first strike" strategy. Nonetheless, this accusation has increasingly been accepted as fact. After all, the Bush administration's National Security Strategy endorses a strategy of preemption against the use of WMD and the Pentagon's Nuclear Posture Review (as leaked to the press) reportedly lays out contingencies under which nuclear weapons may be used. While neither talks about "first use," they don't rule it out either. The latest "proof," as cited by Mayor Akiba, is the Bush administration's "resumed research into mini-nukes and other so-called ``seable nuclear weapons.'" He is referring to recent Congressional legislation approving research on the potential development of smaller nuclear weapons (reversing a 10-year ban on R&D on weapons with an under five kiloton yield). Approval to actually produce such weapons was neither sought by the Pentagon nor granted by the Congress. The legislation does permit the Pentagon to begin examining, in Defense Secretary Donald Rumsfeld's words, "a variety of different ways _ conceivably _ to develop the ability to reach a deeply buried target." This is the apparent objective of the Omaha meeting. Critics at home and abroad are quick to point out that such actions run contrary to the Bush administration's professed counter-proliferation goals since they emphasize rather than downplay the potential future importance of nuclear weapons and thus could encourage others to also seek this edge. It's no wonder, critics argue, that North Korea feels compelled to pursue its own nuclear deterrent in the face of this increased U.S. nuclear threat. While experts can easily dismiss such misconceptions, they have a cumulative impact on the minds of friends and potential foes alike about Washington's commitment to the Nuclear Non-Proliferation Treaty (under which the nuclear weapons states also have responsibilities) and to the probability or desirability of the future use of nuclear weapons. This hardly serves U.S. non-proliferation or broader national security interests. Perhaps it's time for the Bush administration to consider a "no first use of weapons of mass destruction" policy. This would emphasize the purely deterrent role that nuclear weapons continue to play in U.S. defense strategy, not just against the use of nuclear weapons by potential adversaries but by their use of chemical or biological weapons (the "poor man's nucs") as well. It recognizes the political reality that the American people would never tolerate the use of nuclear weapons by its government other than in self-defense in response to a WMD strike; and the military reality that, in this age of advanced technology and U.S. weapons superiority, nuclear weapons are not needed either for preemption or to prevail in a conventional conflict. It's time for Washington to return to the moral high road and put the WMD debate into proper perspective. A "no first use of weapons of mass destruction" policy declaration would be a significant step in this direction. (by Ralph A. Cossa)

From The Korea Times 08/10/2003

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Pacific Nations Urged to Collectively Tackle Security Threats

THE HEAD of the Pacific Islands Forum, Noel Levi, says members can no longer rely on their isolation for security against terrorism. He made the comment while opening the regional body's annual forum in Auckland. Mr Levi has called on member countries to collectively tackle regional instability, citing the assistance mission to Solomon Islands as a model for intervention. He said the Pacific is no exception to the theatre of conflict, and biological and chemical weapons can reach its islands' shores with ease. The South Pacific has been rocked by several coups, army mutinies, ethnic fighting and widespread corruption in recent years. Australia's Prime Minister John Howard has previously said the Solomons intervention is necessary, to prevent the country from becoming a failed state and a potential breeding ground for terror. Australia has also expressed concern about other Pacific nations becoming failed states. - ABC/PINA Nius

From http://www.pacificislands.cc/ 08/13/2003

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Demographic Changes Challenge Asia's Education Policies, Says ADB's Key Indicators

BANGKOK, THAILAND - Most of Asia's developing economies (ADEs) are in the midst of a demographic transition from high to low mortality and fertility. Education policies will play a crucial role if they are to reap economic benefits from this trend, but they also represent a considerable challenge, particularly for the poorest countries. This is a key message of the Asian Development Bank's (ADB) Key Indicators (KI) 2003 launched here today. KI, ADB's annual statistical databook on economic, financial, and other social indicators, includes a special chapter that analyzes the region's education trends. "With improvement in public health and nutrition, more children survive and women respond - with some delay - by reducing their fertility," KI points out. During the transition, as mortality drops but fertility remains high, a large generation of "baby boomers" is created. In this first phase of the transition, the young population increases, as does demand for education. It is critical, therefore, for ADEs to address and finance this challenge in a proactive manner. In the second phase, baby boomers enter the adult labor market, which, if it is able to absorb them, results in a productivity gain and economic expansion. This phase, when the proportion of working-age population is highest and age dependency ratios lowest, offers a "demographic dividend". Governments should create certain conditions to take full advantage of this opportunity, asserts KI. "One is to assure that the boomers will constitute an educated and productive labor force that will be absorbed by the labor market," says KI. The East Asian economic miracle was largely determined by the availability of educated people plus the dynamic industrial activities to absorb them. The drop in both mortality and fertility rates will result in wide disparities among countries in the school-age population over the next two decades. In some countries -notably the poorest- where a fertility decrease will follow low mortality with a significant time lag, the population aged 6-17 will increase substantially. For example, it will double in Afghanistan, increase by more than 50% in Bhutan, Maldives, and Pakistan, by more than 30% in Cambodia, Lao PDR, Nepal, and Solomon Islands. In contrast, it will rise only 3% in India. However, the population aged 6-17 will significantly drop in countries where low mortality and low fertility take place at the same time. It will decrease by 18% in People's Republic of China, and by 30% or more in Kazakhstan, the Republic of Korea, and Singapore. "These demographic dynamics have important implications for education policy," says KI. For ADEs where the number of young people is falling, the challenges are less about the supply of infrastructure and more about improving the quality of education and expanding access to tertiary education, adult skill development, and using the latest technologies. These countries are well positioned to take advantage of globalization in their efforts to catch up with industrialized economies. On the other hand, "ADEs with rising numbers of school-age children face more varied challenges. These include the need to expedite improvements in primary and secondary school curricula, while infrastructure demands will continue to be pressing." In South Asia in particular, the challenge of meeting the "Education for All" target over the next 15 years under the Millennium Development Goals is formidable, as rising populations increase demands on already over-burdened systems.

From http://www.adb.org/ 08/19/2003

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Asia Pacific Network Information Center Policy Meeting Opens in Seoul

The 16th Asia Pacific Network Information Center (APNIC) policy meeting opened its four-day run in Seoul on Tuesday to discuss Internet address policy in the Asia Pacific region. APNIC is one of the four regional Internet registries currently operating in the world. It represents the Asia Pacific region, comprising of 62 countries. It provides allocation and registration services, which support the operation of the Internet globally. It is a non-profit membership-based organization whose members include Internet service providers, national Internet registries, and similar organizations. The Seoul meeting will focus on next-generation Internet operation technologies and international Internet address policy. In particular, on hand at the meeting are Paul Twomey, chairman of the Internet Corporation for Assigned Names and Numbers, and representatives of the remaining three regional Internet registries from other continents. In conjunction with the meeting, the "Korea Internet Operation Workshop (KIOW) 2003" also opened its four-day session on Tuesday. KIOW is a forum where Internet specialists from in and out of Korea will come together to discuss Internet operations, technologies and policies. The KIOW 2003 includes sessions on Internet security, wireless Internet operations, IPv6 and DNS operations.

From http://www.kois.go.kr/ 08/20/2003

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Bush to Push Free Trade in Asia

MANILA - US President George Bush is to step up Washington's initiative to forge bilateral free trade agreements during his visit to Southeast Asia in October, officials say. Bush is expected to launch negotiations for a free trade agreement (FTA) between Washington and Thailand when he attends a Bangkok summit of the Asia-Pacific Economic Cooperation (APEC) forum on October 20-21, an official of the US-ASEAN Business Council said. This will spur talks for separate agreements with other Association of Southeast Asian Nations (ASEAN) member states, council president Ernest Bower told reporters at the annual ASEAN finance ministers meeting. Washington sees its FTA with Singapore, the only one signed with an ASEAN member so far, as a stepping stone to a potential 500 million consumers in Southeast Asia. "A US-Thailand FTA has a good possibility of being launched in October when President Bush visits Bangkok," said Bower, who is to meet with the finance ministers to push the FTA agenda. "Indications are that Thailand is ready and with the US-Singapore cornerstone already laid and the US-Thailand FTA coming up after that, and hopefully Malaysia, those will highlight the benefits of FTAs politically to the region as well as in the US," he said. Malaysian International Trade and Industry Minister Rafidah Aziz "has already decided to move forward" with initial negotiations for a US-Malaysia FTA while the Philippines and Indonesia could also consider coming aboard after their presidential elections in 2004, Bower explained. "Once they get their new teams in place after the elections, FTAs with the US will be on the table for both of these countries," he said. "We are pretty optimistic about this. It it a big work agenda but one that US businesses welcome and we are very positive, lobbying hard to move quicker here in Manila (at the ASEAN meeting) and Washington," Bower added. His council groups top US firms doing business in the 10-member ASEAN, comprising Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam. The council is conducting a series of joint studies through think-tanks from US and each ASEAN member state to determine the benefits of bilateral free trade arrangements. Bower said the US-Singapore FTA signed in May was expected to add about 20 billion dollars in the next five years in new economic activity between arguably two of the world's most open economies. "That's already pretty incredible so, think about what incremental value you can gain with (other ASEAN) countries with trade barriers that are actually very much an impediment to new investments and new trade." "I think you could see huge numbers in terms of US-ASEAN trade and investment as these FTAs are formed," Bower said. The Enterprise for ASEAN Initiative announced last year by Bush offers ASEAN members opportunities to sign FTAs with Washington provided they are committed to economic reforms and openness, officials said. The United States is the largest investor in Southeast Asia and the biggest export market for the region. "So we have a lot to gain and a lot to lose if we do or don't stay active in the region," Bower said. US investments in ASEAN so far have risen to 50 billion dollars, according to the US Department of Commerce, but Bower said the "current value" is three times more than that.

From http://www.bday.co.za/ 08/20/2003

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Us Human Trafficking Report Faults Georgia, Kazakhstan, Turkey and Uzbekistan

An annual report on human trafficking issued by the US State Department identifies Georgia, Kazakhstan, Turkey and Uzbekistan as among the worst nations in the world in preventing forced prostitution and slave labor.Overall, 15 nations were designated as "Tier 3" countries in the State Department's Trafficking in Persons report, released in June. According to the State Department, nations in the Tier 3 category failed to meet minimum standards outlined in the Trafficking Victims Protection Act, passed by the US Congress in 2000. In addition, Tier 3 states are "not making significant efforts to eliminate human trafficking and bondage," the report said. Concerning Georgia, the report said the country is "a source country for women trafficked primarily to Turkey, Greece, and the UAE, with smaller numbers trafficked to Israel, Spain, Portugal and the United States for purposes of sexual exploitation, domestic servitude and forced labor." It expressed special concern that "thousands of children living in the streets and in orphanages" were vulnerable to trafficking.Kazakhstan received a Tier 3 designation largely because of authorities' diminished response to the human trafficking issue over the past year. Though Kazakh law forbids "illicit migration" and officials investigated several reports of trafficking, no cases have yet gone to court. However the reported noted that the government "presented to Parliament long-awaited draft anti-trafficking legislation, which passed the lower house of Parliament on May 15."The report described Turkey as "a destination country for persons trafficked for the purposes of sexual exploitation and labor." It also said Turkey served as a transit country for women and girls being trafficked to Western Europe. Most women and girls trafficked to or via Turkey come from the former Soviet Union, according to the report. It went on to note that the Turkish government "does not have a system for victim identification and protection."The State Department called Uzbekistan "primarily a source, and to a lesser extent, a transit country" for trafficked individuals. "Confirmed information on the extent of trafficking from Uzbekistan only recently emerged, and there is a concern that the deterioration in the economy may lead to a growing problem," the report said. The human-trafficking report asserts that between 40 percent and 80 percent of Uzbeks have slipped into poverty since 1991. "Trafficking could become a greater problem if left unchecked," the report added. It went on to note that during the first half of 2003, Uzbek authorities "showed a greater willingness to focus on the [trafficking] issue, especially through improved dialogue with victim assistance NGOs. This recognition came late in the reporting period, and now its treatment of known victims and of women fitting the victim profile must be improved."The State Department has authority to suspend aid (except aid termed "humanitarian, trade-related, or…development-related") to countries that show no meaningful efforts to stop human trafficking. It remains to be seen, however, whether the US government would actually move to suspend such aid to Georgia, Kazakhstan, Turkey and Uzbekistan. Georgia and Uzbekistan have emerged as key US strategic allies in the Caucasus and Central Asia. Although Turkish ties with the United States have been strained since Ankara declined to host temporary US bases to support the invasion of Iraq, Ankara nevertheless remains a key component in regional stabilization efforts. [For additional information see the EurasiaNet archive]. Meanwhile, close US-Kazakhstani cooperation on oil and gas development projects would appear to preclude American sanctions over Astana's lax approach on human trafficking.In Uzbekistan's case, the government is reportedly trying to make it easier for victims to return from abroad, said the report, and has allowed some anti-trafficking groups to give lessons in public schools. Law enforcement has shown some improvement as well, the State Department says. "The Prosecutor General has taken actions against illegal recruitment, especially through marriage agencies and tourist firms and is pursuing a case involving 56 men who may have been labor trafficking victims in Siberia," the report notes. "It is also investigating the case of a girl trafficked for sex to the United Arab Emirates." State-controlled media in Uzbekistan is giving increasing coverage to the trafficking issue. Human trafficking stories have appeared on state television, and some NGOs are conducting programs to raise awareness about trafficking-related issues. [See related story]. An article published August 5 in the Qishloq Hayoti newspaper indicated that human traffickers were taking advantage of the desperate circumstances confronted by many Uzbeks. "There are many cases of unemployment and low salaries in the country's labor market," the newspaper said. "It is not a secret that, as a result of such economic disparity, false entrepreneurs, who are involved in such illegal activities as theft, violence and fraud, are using people as a labor force, as well as pushing women into prostitution. They are deriving considerable profit from this." On August 1, Pravda Vostoka published a long article that hinted a government crackdown against human trafficking. "Those who are engaged in the human trafficking business should know that they will not escape punishment," the article warned. The article also cautioned those seeking ways to find work in foreign countries that "you should never rely on advice given by your friends who have been abroad. They could turn out to be recruiters of labor and sex traffickers." The State Department report said Armenia, Kyrgyzstan, and Tajikistan were "making significant efforts" to comply with US mandates to curb trafficking. The countries were designated "Tier 2," meaning they have serious trafficking problems but have increased their attention over the past year to addressing the issue. The report did not evaluate trafficking conditions concerning Azerbaijan and Turkmenistan.

From http://www.eurasianet.org/ 08/21/2003

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Successful Doha Round Essential to World Economy

World Bank President James D. Wolfensohn and International Monetary Fund Managing Director Horst K?hler last week sent the following letter to Dr. Supachai Panitchpakdi, Director-General of the World Trade Organization (WTO), reiterating the importance of a successful round of multilateral trade talks to developing countries. The letter also reaffirms the two institutions' commitment to help developing countries adjust to a more open trading environment.

From http://web.worldbank.org/ 08/25/2003

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Six-Way Nuclear Talks Set to Start in Beijing

Six-way talks are set to kick off in Beijing on Wednesday in the hope of resolving the North Korean nuclear crisis. Participants include North and South Korea, the US, Russia, Japan and of course, the host nation, China. But while there is optimism that talks will not collapse, there is also little hope of any significant breakthrough. Delegates believe this round will merely mark the start of a long process of negotiations. The talks are aimed at persuading Pyongyang to abandon its nuclear ambitions. It has taken a good 10 months for the meeting to take place since the US first confronted North Korea with evidence of its nuclear arsenal. But delegates are far from upbeat that any significant progress will be made, saying this round will merely mark the start of a long process of negotiations. That may well be true given the renewed strained ties between North and South. Tensions in relations have spilled over to even the World University Games in Daegu, South Korea. The team from the North has threatened to pull out twice over allegations of disrespect for its leader Kim Jong-Il and the national flag. Nevertheless, the US is hopeful that the China-brokered talks will eventually succeed and lead to North Korea letting go its nuclear plans. James Kelly, US Assistant Secretary of State, said: "We have worked a long time with our Chinese friends. We have worked for a long time to have these multi lateral talks. We'll be getting going on Wednesday morning and we're looking forward to a direct and fair exchange of views. "But Pyongyang is not likely to cede its only bargaining chip easily and it wants an iron-clad promise from the US guaranteeing its security. And that is not the only hurdle to cross. Japan is reported to be planning to seek a resolution on the issue of kidnapped Japanese citizens by North Korean agents. This is a move which observers say could distract attention away from the main issue of Pyongyang's nuclear threat.

From http://www.channelnewsasia.com/ 08/26/2003

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CHINA: Senior CPC Leader Urges Promoting Social Sciences

A senior leader of the Communist Party of China (CPC) Friday called on Chinese researchers to further promote the development and prosperity of philosophy and social sciences in China. Li Changchun, a member of the Standing Committee of the Political Bureau of the CPC Central Committee, made the call at a meeting in Beijing on the appraisal of proposed research programs to receive funding from the China National Social Science Foundation in 2003. Li said philosophy and social sciences are an extremely important part of the work of the CPC. To stay at the forefront of the times and promote the revitalization of the country, the CPC needs the guidance of scientific theories and the support of developed philosophy and social sciences. He called on researchers to push the study of the important thought of "Three Represents" to new heights and to integrate the thought into philosophy and social sciences. He also urged vigorously pushing forward the innovation of theories and bringing philosophy and social sciences closer to the general public. More than 300 celebrated experts in the fields of philosophy and social sciences attended Friday's meeting.

From Xinhua News Agency 08/01/2003

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CPC Central Committee Plenum Scheduled for October

The Third Plenum of the 16th Central Committee of the Communist Party of China (CPC) will be held in Beijing this October. The plenum will mainly discuss how to further improve China's socialist market economic system, and deliberate a proposed amendment to the Chinese Constitution. The decision to convene the plenum was made at Monday's meeting of the Political Bureau of the CPC Central Committee in Beijing, presided over by General Secretary Hu Jintao. The Political Bureau held that the target set forth at the 16thCPC National Congress of establishing a complete socialist market economic system and a more vigorous and more open economic system calls for further economic restructuring to stimulate economic and social development. The reform should be stepped up to further emancipate and expand productive forces at a time when economic globalization and the advance of science and technology are accelerating, and when China is working for moderate prosperity and building socialism with Chinese characteristics. A stable Chinese Constitution serves as the foundation for stability of the country. The current Constitution of China generally accommodates the needs of reform, opening up and modernization drive. However, it is still necessary to make certain amendments to promote economic and social development. Deng Xiaoping theory and the important thought of "Three Represents" should serve as guidelines for both the reform of the economic system and the revision of the Constitution. Meanwhile, the spirit of the 16th CPC National Congress of emancipating the mind, seeking truth and keeping pace with the times should be fully carried out while fulfilling both tasks. The meeting also emphasized the importance of pursuing correct political direction and soliciting opinions from all circles in revising the Constitution. The proposed amendment to the Chinese Constitution, after being deliberated at the Third Plenum of the 16th CPC Central Committee, will be submitted to the Standing Committee of the Chinese National People's Congress for deliberation in accordance with the legal procedures. At the next plenum, the Political Bureau of the 16th CPC Central Committee will also report its work to the Central Committee, which were both elected last November at the 16th National Congress of the CPC.

From http://english.peopledaily.com.cn/ 08/12/2003

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NPC to Discuss Key Law

China's leading legislators decided on Friday that the nation's lawmakers will discuss a draft law on administrative licensing later this month. The Standing Committee of the 10th National People's Congress (NPC) will have a fourth round of deliberations on the draft law during their latest session from August 22 to 27 in Beijing, at which they are expected to pass the legislation. This decision was made at Friday's meeting of the chairman and vice-chairpersons of the NPC Standing Committee, presided over by Wu Bangguo, the committee chairman. Administrative licensing, referring to formal legal permission to conduct business or business-related activities, is a major governmental function, said Yu An, a professor of administrative law at Tsinghua University Law School. "It will become a revolutionary act if the legislators pass the draft law," Yu said, adding that the law will play a critical role in the connection between domestic and international market as well as the unification of the domestic market. He said the law will clearly define the relations between the government and the market mainly in the economic field and set procedures for the establishment of administrative licensing. The draft law will offer comprehensive principles and procedures on how to conduct administrative licensing. Currently, such administrative permission is regulated by scattered laws and regulations. It is also expected to greatly reduce the amount of administrative licensing, hazardous expansion of which seriously hampers China's efforts to build a market economy. There are some 4,100 items that require licensing in this country, according to sources with the Legal Affairs Commission of the NPC Standing Committee. Overuse of licensing is a hotbed for corruption because it creates more opportunities for kickbacks, said Ying Songnian, professor and director of the Department of Law of the National School of Administration. Overelaborate procedures, poor efficiency, and underground, unfair or imprecise conditions for granting licenses also stand out, he added. The State Council began a nationwide campaign to rectify the situation in year of 2001, some 1,200 licensable items are expected to be axed. The lawmakers will also discuss amendments to the central bank law and commercial bank law as well as a draft law on the supervision and management of banking businesses when they meet.

From China Daily 08/16/2003

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Call for New Interconnection Policy

The Ministry of Information Industry (MII) has pledged to straighten up the telecom market by introducing a new inter-connection policy later this year so as to further standardize the country's telecom industry. "To tackle the problem concerning network inter-connections is an urgent factor to ensure a fair, efficient and competitive environment for the whole industry," said Xi Guohua, vice-minister of the MII while addressing a nationwide video-conference in Beijing recently. According to him, the new inter-connection policy will be based on the cost incurred by telecom operators to connect calls between networks. "The first stage of testing of the new policy is completed and the second stage is underway right at the moment," said a knowledgeable source close to the MII. "It is expected to be rolled out later this year." Analysts said that old policy which started on March 21, 2001, and expired on March last year, which is still in use, is no longer fit for the development of the rapid development. Besides, a batch of new regulations and standards will also be kicked off in the second half of the year, according to Xi. "We will strengthen our punishment on destroying telecom utilities which leads to the suspension of inter-connections," he stressed. According to him, the MII is working in hand with the Supreme Court to discuss related punishment on the violation of interconnections. "We are doing the investigation works and soliciting suggestions from telecom insiders and experts now," he said. Figures from the MII showed that since 1998, cases related to interconnections had topped more than 540, resulting in economic losses of about 3 billion yuan (US$360 million). "It's a high time to regulate the market to ensure the healthy development of the industry," said Jiang Yaoping, director the Policy and Regulation Department of the MII. In another development, sources said that the MII is speeding up the promulgation of telecom law and is expected to unveil it at the end of the year or early next year. Sources also said in order to guarantee the smooth network inter-connections, the ministry is to build up a telecom network supervision system to supervise the network inter-connections among all telecom operators. "The major problem concerning inter-connections lies in linking mobile and fixed-line networks," said Zhang Xinzhu, director of the Centre for Planning and Competition Studies under the Chinese Academy of Social Sciences, in an interview with China Daily. Currently, inter-connections between mobile networks are free. But transferring a mobile phone call to a fixed-line costs 0.06 yuan (US$0.007). However, China Telecom and China Netcom calculate that it should cost 0.16 yuan (US$0.019). "The disagreement on pricing is the main reason behind unsatisfactory development of inter-connections and rampant violations," Zhang said. "However, it will take more time to set up network inter-connections among all the major telecom operators, given the complexity of inter-connection policy," he said. Zhang is also a member of the expert panel founded by the MII early this year to work out inter-connection problems. He said the expert panel is also trying to figure out new universal service and tariff policies for the sector.

From China Daily 08/17/2003

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Re-employment Higher on Agenda of Chinese Government

Top Chinese leaders have urged all areas of China to make the issue of unemployment one of their top priorities, warning that failure to tackle the problem could lead to social instability and damage the country's modernization drive. At a meeting here over the weekend, Chinese President Hu Jintao and Premier Wen Jiabao said that China faces a grave employment situation, urging all localities to fully understand the importance and urgency of the issue and take concrete measures to solve it. Analysts here said that the move not only reflected the government's increasing concern over re-employment, but also indicated a shift of policy from more emphasis on economic growth to putting economic growth and employment on an equal footing. Since China started its reform and opening-up in the late 1970s,the country's planned economy has given way to market-oriented reform, which has increased both the efficiency of state-owned enterprises and the number of laidoff workers from these enterprises. Meanwhile, a large number of surplus laborers in rural areas swarmed to cities to hunt for jobs, further exacerbating the already tense urban labor market. Official statistics show that some 10 million job hunters will enter the labor market this year, in addition to over 6 million laidoff workers and 8 million registered unemployed people nationwide. The situation is expected to remain tough as labor supply will continue to exceed demand for the next few years. "It's interesting to note that the unemployment issue came with the high economic growth in the past years," said Zheng Gongcheng, professor of the School of Labor Relations and Human Resources under the Beijing-based People's University of China. In the 1980s, one percentage point GDP growth would provide jobs for 1.3 million people, but the figure dropped to 900,000 in the 1990s and then to 800,000 at present. "This indicated that job opportunities will not emerge simply with economic growth," he said. Zheng cited Zhongguancun in Beijing, the so-called Silicon Valley of China, as an example, saying that the district is a major contributor to Beijing's GDP growth, but it absorbs a limited number of labor force. "The move by the Chinese government to make the re-employment issue more prominent fully reflects its new development concept and also indicates the issue has been given an equally important role in the country's development," said Zheng. At the meeting, Wen Jiabao called for great efforts to develop labor-intensive industries, the tertiary industry and the non-public economic sector, which he said are major sources for employment. This also reflects a change of idea of the government," Zheng said, noting that the country has long sought high economic growth through the high-tech industry. The high-tech industry should not be developed at the cost of the industries that can absorb huge jobless people as China has a 1.3 billion population, he said. Zheng's point of view was echoed by Lu Xueyi, president of the China Sociology Society, who said that bigger efforts should be made to develop the tertiary industry, or the service sector, which absorbed 70 percent of the country's new labor force over the past five years. "Greater potential for employment still lies in the sector," he said, noting that this could be achieved through quickening the pace of urbanization. To meet this year's employment challenge, the government has set an annual goal of creating 8 million job opportunities to ease the labor market tension. Both government officials and economic experts here are optimistic about achieving the goal, saying that the rapid economic growth in the first six months of this year has laid a solid foundation for it. In the first half of this year, China realized a GDP growth rate of 8.2 percent despite the SARS impact and the yearly target of 7-percent economic growth is expected to be fulfilled by the end of the year. Meanwhile, the service sector is recovering rapidly and increasing its ability to absorb more workforce now that SARS has been contained. "So long as effective measures are taken to boost the labor-intensive industries, the tertiary industry and the non-public economic sector, both the two set targets, will be fully achieved," said Zheng.

From Xinhua News Agency 08/18/2003

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Chinese Government to Rationalize Auto Sector

China will soon take measures to cool down its overheating automotive industry, despite continuing rapid growth in domestic vehicle demand. The measures, to "make investment rational and prevent redundant construction in the auto industry," will be included in a new government policy, said sources from the National Development and Reform Commission (NDRC), the industry's main watchdog. The long-awaited policy will be launched in the near future, sources said. Tens of billions of US dollars have been invested in vehicle production in China by foreign auto giants, and domestic State and privately-owned companies in recent years, spurred by fast-growing vehicle demand. "However, the demand will fluctuate as a result of energy supply, environment and transportation problems in China, and blind investment will generate excessive vehicle production capacity. So the government must take measures," said an NDRC official. The government will control the vehicle assembly capacity of domestic companies through imported CKD (completely knocked down) components, according to a draft new auto policy. The CKD component imports will be treated as vehicle imports. The government also wants to increase technology and development capability requirements of some automakers. Total annual vehicle production capacity will reach 10 million units by 2005, according to the China National Automotive Industry Consulting and Development Corp. Sales of vehicles made in China totalled 2,373,800 units during the first seven months of this year, an increase of 30.97 per cent from a year earlier, according to statistics from the China Association of Automobile Manufacturers. Domestically produced passenger car sales grew by 77.13 per cent year-on-year to 998,900 units during the period. Official statistics indicate there are more than 120 vehicle plants in China, among which only two have an annual output of more than 500,000 units, eight more than 100,000 units, and 95 less than 10,000 units. "Many automakers in China will be phased out as a result of overheating investment and mounting vehicle imports now that China is a member of the World Trade Organization (WTO),'' said Jia Xinguang, chief analyst with the consulting company. Under its WTO obligations, China will remove quota and permit barriers on vehicle imports by 2005 and will cut tariffs to 25 per cent by the middle of 2006. "What the government should do is to control investment of State-owned automakers, especially the top three, and to guide more investment in the nation's auto components sector to build a strong buttress for the auto industry,'' Jia told China Daily yesterday. The top three -- First Automotive Works Corp, Dongfeng Motor Corp and Shanghai Automotive Industry Corp which each have teamed up with two or more foreign automakers -- will control half of the total vehicle production capacity in China in coming years.

From http://english.peopledaily.com/ 08/19/2003

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HK to Conduct Article 23 Consultation in Sept

Hong Kong's Secretary for Security Ambrose Lee said Monday the final version of the proposed security bill will take various views of the community into account, as another round of Basic Law Article 23 consultation will be launched next month. Lee also said he has started scheduling meetings with political parties. The content and format of the consultation paper has not yet been decided, Lee said, adding that he will not limit it to any particular sector of the community nor any particular method. According to Lee, the Hong Kong Special Administrative Region (SAR) government will listen to different voices very carefully and the final version will garner community approval. The SAR government will try to reach as many people as possible in the new exercise and make the consultation document easier to understand, and the government has not set a timetable for implementing Article 23, he added. Under Article 23 of the Basic Law, the Hong Kong Special Administrative Region shall enact laws on its own to prohibit any act of treason, secession, sedition, subversion against the Central Government, or theft of state secrets, prohibit foreign political organizations or bodies from conducting political activities in the region, and prohibit political organizations or bodies of the region from establishing ties with foreign political organizations or bodies.

From Xinhua News Agency 08/19/2003

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China Makes Most Marriages Easier

BEIJING, China (AP) -- China is lifting its demand that couples obtain approval from their employers before being married, but will continue to ban same-sex unions, state media reports. Civil Affairs Ministry official Zhang Mingliang said China's 2001 marriage law forbids gay marriages and officials won't process paperwork for any such unions, the official Xinhua News Agency and newspapers reported Wednesday. "According to relevant rules, couples of the same sex are forbidden to marry each other," Zhang was quoted saying in The Beijing Times newspaper. Canada recently allowed gay marriages, sparking some discussion in China. The Beijing Times said Zhang, head of the ministry's Community Development Department, made his comments Tuesday in response to "a controversy in society over the issue of whether homosexuals should be allowed to marry." Gays were strongly persecuted after the founding of communist China in 1949 and Chinese psychiatrists, until recently, listed homosexuality as a mental illness. Even today, few Chinese gays publicly acknowledge their homosexuality and anti-gay discrimination is still strong. The new marriage registration rules, to take effect October 1, eliminate the demand that couples first obtain certificates of approval from their employers, before they wed. The requirement harkened to the days when a person's state work unit controlled many aspects of life including housing, health care and children's education. Those regulations have been loosened considerably because of mass closures of moribund state industries, the rise of the private economy, and increasing mobility among Chinese. Xinhua quoted Zhang saying the old rule "violated to some extent principled policy of the freedom of marriage."

From http://edition.cnn.com/ 08/20/2003

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China Redefines Seven Criminal Charges

A judicial interpretation redefining the crimes of employment of child labourers for dangerous work, the smuggling of wastes and five other criminal accusations was jointly issued by the Supreme People's Court and Supreme People's Procuratorate Thursday. The redefinition of charges is based on the latest amendments to China's Criminal Law by the Standing Committee of the Ninth National People's Congress, said Ma Dong, an official with the Supreme People's Court. Aiming for illegal profits, some enterprises have hired child labourers to work high above or under the ground or in other hazardous environments, legal experts said. Employers who hire labourers under the age 16 to do excessively heavy physical jobs or work under harmful environments would be sentenced to three to seven years of imprisonment along with fines, according to the amendments. Some of the changes have widened the sphere of application of related articles of the criminal law, Ma explained. For example, the crime of smuggling solid wastes has been turned into the charge of smuggling wastes.The new definition enlarges the scope of smuggled wastes to include liquid and gas, as well as solids, Ma said. According to the amended law, smugglers of wastes mainly imported from abroad would be fined and imprisoned for less than five years. For those with more serious crimes, imprisonment would exceed five years. The charges of illegal logging and destruction of major State-protected plants and the illegal purchase, transport, processing and sale of major State-protected plants and their products were likewise amended. The accusation formerly focused on the illegal logging and destruction of precious trees, according to the interpretation. The nation's judicial departments should promulgate relative articles after the top legislative body has conducted amendments to current Criminal Law, said Chen Xingliang, a law professor with Peking University.

From http://www1.chinadaily.com.cn/ 08/22/2003

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New Law to Boost Govt Supervision of Bank Risk Management

A draft law on banking supervision, being discussed by China's top legislature Saturday, pushes for increased emphasis on banking risk management by China's bank watchdogs. The draft has introduced some of the Basle Core Principles for Effective Banking Supervision, internationally-accepted rules for banking supervision put forward by the Basle Committee on Banking Supervision and sponsored by the Bank for International Settlements. China's banking supervision policies will shift from simply monitoring the legitimacy of operations to putting equal importance on both legitimacy and risk control, said Liu Mingkang, chairman of the China Banking Regulatory Commission (CBRC), while elaborating on the draft law at the fourth session of the Tenth National People's Congress (NPC) Standing Committee. Under the draft law, the CBRC shall set up effective guidelines to minimize financial risks for commercial banks, and exercise cross-border banking supervision together with bank watchdogs of other countries and regions. "The draft law will be a critical step for China to introduce globally-accepted rules, and we expect to see a more open market here," said Dicky Yip, chief executive of China business at the Hong Kong-based Hongkong and Shanghai Banking Corporation. But the draft law should adopt more detailed items on how the CBRC shall develop guidelines to minimize banking risks, said Wang Yiming, an NPC Standing Committee member. Wang, who joins other members at the NPC session to discuss the draft law, added that, so far, the item is too obscure. The draft law has such problems as weak regulation of the operation of the bank watchdog itself and being unclear about the legal liability it should bear, said Li Lianning, another NPC Standing Committee member. Under the draft law, the CBRC is authorized to oversee all banks and financial institutions in China, investigate illegal banking operations and administer punishments for violations of the law. Since the CBRC was founded on April 28 this year, the new bank watchdog has carried out a series of measures to control banking risks, including probing the non-credit operations of the four state-owned commercial banks. It has announced that all domestic banks, both state-owned and joint-stock ones, are required to adopt the commonly-accepted rule to sort loans into five grades, from best to worst, next year. Experts here noted that domestic banks in China still carry large non-performing loans, and that there is only a short time left for the country to deal with the problem before foreign banks enter the market vigorously. According to the CBRC, domestic banks reported a 19.6 percent non-performing loan rate by the end of June this year, totaling 2.54 trillion yuan (307.13 billion US dollars). "It is of great significance for China to have such a law, to cope with increasing risks in banking when China is opening further its financial market," said Yan Yixun, member of the NPC Standing Committee. However, some top legislators said it is still too early to draw up a banking supervision law.

From http://english.peopledaily.com.cn/ 08/24/2003

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Bill Introduces Administrative Licensing Hearing

A draft law on administrative licensing, which is now undergoing final scrutiny by national legislators, says that a hearing must be held prior to the establishment of an administrative license when there is a conflict of interest to ensure transparency and fairness. Administrative licensing is a major government function. It refers to the issuing of formal legal permission to conduct business or business-related activities. The draft law was drawn up by the State Council to streamline the establishment and enforcement of administrative licensing, safeguard the legitimate rights and interests of citizens, corporations and other organizations, and maintain public interest and social order, while ensuring the effectiveness and efficiency of administrative management. The latest session of the Standing Committee of the 10th National People's Congress, the country's top legislative body, is expected to vote on the draft law on Wednesday. Zhang Shicheng, a division chief of the Legislative Affairs Committee under the Congress Standing Committee, said: "The introduction of the hearing system into the administrative licensing process will better ensure that the interests of all related parties get fully considered." Administrative organizations should inform the public that an administrative licence is to be established and hold hearings on establishing administrative licenses as required by laws and regulations or when they think a hearing is necessary for the public interest, according to the draft law. The bill also grants applicants for a certain administrative licence and other interested individuals the right to demand a hearing. The draft law says the administrative organizations should inform the applicants and interested individuals of their right before making a decision on the administrative licence. Administrative organizations should hold a hearing within 20 days if the applicants and interested individuals request a hearing within five days of the administrative organization announcing that an administrative licence is to be established. Neither the applicants nor the interested individuals should bear the expenses of such hearings, the draft law says. The bill also stipulates that administrative organizations should pay compensation if the administrative licensing process has been conducted illegally. Such provisions are a credit to the draft law, legislator Xin Chunying told a discussion on the bill held by the Congress Standing Committee at the weekend. But legislator Gao Zhiguo said the draft law should include more details on the issues that will require a hearing. He said a hearing should be required in principle for all administrative licensing on issues concerning national security, the public interest, natural resources, public services and human health.

From http://english.peopledaily.com.cn/ 08/25/2003

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JAPAN: Drafter of SDF-Iraq Law Gets Top Bureaucratic Job

A senior Defense Agency bureaucrat who oversaw the drafting of key legislation allowing for the dispatch of Self-Defense Forces units to help rebuild Iraq was appointed the agency's top administrative bureaucrat Friday. Effective the same day, 58-year-old Takemasa Moriya, former director general of the defense policy bureau, replaced Yasunari Ito as administrative vice minister. Moriya, a veteran career defense bureaucrat, has been behind pivotal defense policy issues in recent years. As director of the defense policy division and defense councilor, he was involved in the negotiations leading up to the conclusion of the 1997 revised security guidelines with the United States, which stepped up bilateral defense cooperation for the post-Cold war era. As head of the defense policy bureau, Moriya also oversaw the drafting of the 2001 antiterrorism law, which saw Maritime Self-Defense Force ships sent to the Indian Ocean to support U.S. forces fighting in Afghanistan, as well as the law to send SDF units to postwar Iraq that was enacted last month. Another personnel change saw Shoei Yamanaka, 54, former deputy vice minister, replace Takehiko Shimaguchi as director general of the Defense Facilities Administration Agency. Both Ito and Shimaguchi retired from the agency as of Friday. Iwao Kitahara, 56, former head of the finance and equipment bureau, replaced Yamanaka as deputy vice minister, while Kazuki Iihara, 53, former vice director general of defense policy bureau, was promoted to director general to succeed Moriya.

From The Japan Times 08/02/2003

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White Paper Cites Need for Missile Defense

Japan must accelerate "research and consideration" of ballistic missile defense, according to an annual Defense Agency report released Tuesday. The defense white paper also calls on the government to increase operations among Ground, Sea and Air Self-Defense Forces to better serve national and international defense activities. For the first time in its 29-year history, the white paper dedicates an entire chapter to the future direction of national defense policy. In past years, white papers have simply been summaries of the nation's defense-related activities over preceding years and agency assessments of international security situations. The Defense Agency is reviewing its basic defense program to reflect the changing security situation amid the post-Cold War environment. The outcome of the review is expected to be released by the end of the year. The program was last updated in 1995. The Diet's enactment in June of war contingency legislation, which defined the basic response to a possible foreign attack, was a "historic turning point in Japan's security policy," according to the white paper. The report calls on the government to beef up national defense in readiness for "more unpredictable" threats, such as terrorism and ballistic missile attacks. The report says missile defense systems, particularly the Patriot PAC-3 and sea-based systems to be deployed on Aegis ships, are now technically feasible. According to the paper, many of the missile defense system tests conducted by the United States have been successful. Facing a perceived threat of a missile attack from North Korea, the government has shown increasing interest in the Patriot PAC-3 and sea-based missile defense systems. Japan is expected to decide on installing such systems by the end of this year. Citing the lessening danger of a landing invasion on Japan since the end of the Cold War, the report says the government will consider cutting back on weapons and other equipment intended to counter such a threat. Some observers believe this decision is borne out of a need to secure enough funds to introduce a missile defense shield. Joint operations among the three SDF forces are required to more effectively serve the changing needs of Japan's national defense and international activities, it says. (by Nao Shimoyachi)

From The Japan Times 08/06/2003

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Report: Japan Seeks Missile System

TOKYO (AP) - Japan's Defense Agency, worried about the threat from North Korea's nuclear weapons and missile programs, hopes to have an anti-missile system in place within three years, a major Japanese newspaper reported Tuesday. The agency is expected to increase spending considerably in the coming years for the initial setup costs and high-tech telecommunications systems for the advanced missile defense, the national Asahi newspaper said. The agency will request nearly $1.2 billion next fiscal year. That request will be nearly nine times greater than the $132 million Tokyo spent on missile defense research from 1999 to 2003. Japan has 27 Patriot anti-missile batteries, but they can only down missiles with a shorter range and slower speed than the ballistic missiles North Korea is believed to be developing. One of the those missiles - the Taepodong - was test-launched over Japan's main island in 1998. The upgraded system would create a two-layer defense system. The first layer uses Aegis-equipped naval destroyers, which have top-of-the-line surveillance systems, to track incoming missiles and intercept them with ship-to-air missiles, Asahi reported. Backup would be provided by an enhanced version of the Patriot PAC2, capable of downing ballistic missiles with a range of 620 miles, the daily newspaper said. In a government report last week, the Defense Agency urged accelerated research on an anti-missile system to protect against possible nuclear and terrorist attacks. It also stressed that North Korea's nuclear ambitions are one of Japan's biggest security concerns. Japan's overall defense budget remains among the world's largest. In 2003, Japan expects to spend $42 billion on defense, or less than 1 percent of its gross domestic product.

From http://www.guardian.co.uk/ 08/12/2003

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Farm Policy May Switch from Defense to Offense Rising IncomesiIn Asia Mean Expensive Japanese Agricultural Exports Now More Affordable

Japan has long been on the defensive over agricultural trade as it sought to protect the nation's farmers, but it may soon go on the offensive. The semi-governmental Japan External Trade Organization in July formed a panel of experts tasked with drawing up a comprehensive strategy for selling Japanese farm products abroad, especially in Southeast Asia. "Until recently, the general understanding had been that Japanese products are too expensive for other Asian markets," said Kazuo Haraguchi, director general of JETRO's agriculture department. "But the region's economies have seen dynamic growth in recent years, and per capita income is on the rise. Considering the keen interest in Japanese food overseas, we figured there might be greater potential for more exports." Statistics support this notion. Last year, the United States was the biggest buyer of Japanese agricultural, fishery and forestry products, importing 71 billion yen worth. But the second to seventh biggest importers were all in Asia, buying a combined 208 billion yen. So the 14-member committee, consisting of scholars, industry representatives and traders, will focus on six target markets -- Hong Kong, Taiwan, South Korea, China, Thailand and Singapore. The committee will study local regulations in such areas as tariffs, trademarks and food safety. It will also send delegates to get a better grasp of prices and packaging styles. Based on the results, JETRO plans to organize trade fairs and sample-tasting sessions across the region beginning next year. While the two-year sales drive covers a wide variety of items, ranging from rice and vegetables to meat and timber, domestic producers stand the best chance of beating rivals with fruit, including apples and pears, Haraguchi said. Last year, Aomori Prefecture, a traditional stronghold of apples that accounts for half of the nation's total yield, saw its apple exports to Taiwan jump more than five-fold to 11,000 tons from the year before. Behind the surge was Taiwan's entry last year into the World Trade Organization, which reduced tariffs on apples from 50 percent to 20 percent. While the U.S. accounts for more than two-thirds of Taiwan's 150,000-ton apple import market, with annual shipments of 100,000 tons to 130,000 tons, Japan boasts exclusive technology to produce large fruit. The top-of-the-line apples, which weigh up to 500 grams apiece -- twice as big as standard ones -- are popular gift items with Taiwanese, who offer them to Buddhist altars during Chinese New Year, said Mamoru Fukasawa, deputy counselor at the prefectural apple and fruit division. "These apples sell for 700 yen to 800 yen apiece," he said. "The top-quality stuff you hardly ever see in a Tokyo department store occupies the shelves over there." But there is no room for complacency among Japanese producers. Currently, Taiwan and China have no official links, including commerce, so there are no direct apple shipments from China. Yet mainland China is the biggest apple producer in the world, with annual production of 20 million tons, dwarfing Japan's annual output of 1 million tons. "I believe the restrictions on (China-Taiwan) trade flow will eventually be eliminated," Fukasawa said. "We want to expand our foothold in Taiwan by then." But as Japan goes out on an aggressive sales campaign globally, it could face even bigger calls from abroad to open up its own agricultural markets. The Central Union of Agricultural Cooperatives (Zenchu), which staunchly opposes farm trade liberalization in the ongoing WTO negotiations, is pushing the concept of local consumption of local food as an ecologically friendly lifestyle. So isn't the farm lobby living by a double standard by promoting exports of Japanese rice through the JETRO panel? "There is no way the Japanese farm industry can be powerful enough to beat other nations' agricultural sectors completely," a Zenchu spokeswoman said, defending the group's participation in the committee. "Our intention is to give (consumers) more options to choose from." Given the huge price gaps between the locally produced products and imported ones, it is a formidable task. According to Zenchu, retail prices of Japanese rice sold overseas are around 250 percent to 600 percent higher than locally grown rice. But Japanese producers seem to have few other options besides looking outward, as the domestic market will continue to shrink with the aging population. What will be the key to successful marketing abroad? Education, proclaimed Katsuhiko Noge, president of trading/export consulting firm Global Communications Co. in Mishima, Shizuoka Prefecture. While the allure of Japanese food is certainly there, the target markets need to be educated on how to cook the food, said Noge, who has organized numerous food fairs and exhibits globally while he headed international operations at the now-defunct Yaohan supermarket chain for 20 years until 1997. He recalled a demonstration he once gave in Hong Kong on how to make miso soup. A local woman came up with a 500-gram package, asking him if it was for one person. He told her it contains 50 servings, and showed her the ropes, adding ingredients such as "fu" wheat gluten and "abura-age" deep-fried tofu. "To promote Japanese food products abroad, you have to educate people on how to cook. You have to give them recipes and cooking demonstrations," he said. "Some Japanese makers (are trying to sell only with) Japanese-language labels on the products." Despite mounting challenges, efforts to woo overseas consumers would give small and midsize agricultural producers in rural areas a great opportunity to test their salesmanship and survive the already fierce competition within Japan, Noge said. "One's best defense is a good offense," he said. "Hong Kong, for example, is such a globalized market that it is ideal to test new products. Going to Hong Kong would put Japanese producers right into world-class competition, which would also make them emerge stronger in Japan." (by Tomoko Otake)

From The Japan Times 08/16/2003

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Agency to Seek 140 Billion Yen for New Missile Defense System

The Defense Agency plans to make a 140 billion yen budget request for the introduction of an antiballistic missile defense system for fiscal 2004, sources said Tuesday. The request, which would be the first of its kind, includes contract commissions for deploying ground-to-air Patriot Advanced Capability-3 (PAC-3) missiles and refitting costs to equip an Aegis-equipped destroyer with Standard Missile-3 (SM-3) missiles. The government intends to start deploying these systems in fiscal 2007 with the Tokyo metropolitan area the first priority. The PAC-3 missiles, designed to intercept enemy missiles near the surface of the Earth, are much more advanced than the Patriot Advanced Capability-2 (PAC-2) missiles currently used by 27 Air Self-Defense Force antiaircraft units. Four ASDF antiaircraft units in charge of defending the air space over the Tokyo metropolitan area are expected to be the first to be equipped with the PAC-3 missiles. The units are based in Iruma, Saitama Prefecture; Narashino, Chiba Prefecture; Kasumigaura, Ibaraki Prefecture; and Takeyama, Kanagawa Prefecture. Deployment of the system will then be expanded to other parts of the nation, the sources said. The government hopes to include in the budget request for fiscal 2004 part of the cost for major improvements to the Base Air Defense Ground Environment control system, which is capable of detecting incoming enemy aircraft and missiles from those of the allies and instantly issuing instructions for interceptions, to make the system compatible with the state-of-the-art PAC-3 system.

From http://www.yomiuri.co.jp/ 08/21/2003

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Japan Ministry Seeks $1 Billion for Missile Defense

TOKYO (Reuters) - Prompted by worries over North Korea, Japan's Defense Ministry is set to make a budget request of more than one billion dollars for the next fiscal year to introduce a missile defense system, media said on Friday. The ministry also plans to boost its air-to-surface attack capability by ordering a GPS guidance system from the United States to convert its airforce's existing bombs into "smart bombs," the Mainichi Shimbun said in its late edition. Japanese officials have repeatedly warned that their nation lacks the capability to defend itself from North Korea, which launched a ballistic missile that passed over Japan in August 1998 and is thought to have built one or two atomic bombs. The report comes just days before crucial six-country talks on North Korea's nuclear program are due to begin in Beijing on August 27. The Nihon Keizai Shimbun financial daily said the ministry is expected to make a budget request of some $1.19 billion for the fiscal year starting next April, a large part of which would be for a new U.S.-made missile defense system. The ministry wants to deploy the Patriot Advanced Capability-3 (PAC-3) missile system, an upgraded version of the PAC-2 system that Japan's air force already possesses, the paper said. It also wants to upgrade its four Aegis destroyers, currently equipped with high-tech missile detection systems, with a U.S.-made missile defense system that includes the Standard Missile-3 (SM-3), the report said. A Defense Ministry spokesman declined to comment on the report. The Joint Direct Attack Munitions (JDAM) guidance system that the Mainichi said the Defense Ministry plans to order were used by U.S. forces during the war in Iraq. A Defense Ministry official denied that the system would give Japan the capability to attack foreign countries, saying that Japanese airforce planes do not have the capacity to disable radar systems, the Mainichi said. The budget would need approval from parliament, and debate is likely to be heated due to Japan's nervousness of anything that threatens to exceed the limits of its pacifist constitution. The postwar constitution bans war as a means to settle international disputes, and that has been interpreted to mean the nation's military must be limited to self-defense.

From http://www.washingtonpost.com/ 08/22/2003

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SOUTH KOREA: Assembly Passes Work Permit Bill

The National Assembly yesterday passed a bill regulating the employment of foreign workers, allowing the simultaneous implementation of a new work permit system along with the existing industrial trainee program. During a plenary session on the last day of July's extraordinary sitting, the Assembly approved the work permit bill by a margin of 148 to 81. It will be put into practice from August next year. With the passage of the bill, some 227,000 illegal foreign workers here were relieved of concerns of being deported by the end of this month, and small- and medium-size companies were able to avoid massive manpower shortages. The new legislation requires migrant workers to renew their employment contracts annually and bans them from working in the country for more than three years. It obliges those staying for over three years to stay away from the country for more than a year before being re-employed here. According to the Ministry of Labor, the work permit system will give qualified foreign laborers various benefits, including industrial accident insurance and minimum wage guarantees. They will also get three key labor privileges _ the rights to form trade unions, collective action and collective bargaining. At the same session, the Assembly rejected another bill to set up an independent judicial inquiry into the ``cash-for-summit'' scandal. The bill had been sent back to the Assembly after a presidential veto last month. The majority opposition Grand National Party (GNP) failed to override the presidential veto on the special counsel bill. Once rejected by President Roh Moo-hyun, the bill needed a two-thirds majority to pass the Assembly. Though the GNP holds 149 of the 272 seats, it fell short of the number required to keep the bill alive, despite exerting joint efforts with the splinter United Liberal Democrats, which holds 10 seats. Of the 257 lawmakers present, 151 cast ballots in favor of the bill, while 105 _ mostly from the ruling Millennium Democratic Party _ voted against it. If the bill had been passed, it would have facilitated a second special investigation into the secret payoff to North Korea by the previous administration just before the historic inter-Korean summit in 2000. Other economy-related bills, including those on the five-day workweek and securities-related class action lawsuits, will likely be dealt with during this month's extra session. The ruling and opposition parties on Wednesday agreed to try and pass major bills as soon as possible to help the nation overcome the economic downturn. (by Ryu Jin)

From http://times.hankooki.com/ 07/31/2003

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Interest Rate Unchanged

The Bank of Korea has left the basic interest rate at 3.75 percent. The governor of the bank, Park Seung, called for caution, citing weak consumer confidence despite rising exports and increased industrial output. (by Don Kirk)

From http://www.nytimes.com/ 08/08/2003

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Assembly OKs Cut in Military Service

The National Assembly yesterday passed a revision bill that will shorten the length of conscriptive duty by two months, starting with those who begin their service in October this year. Under the approved bill, the military service period for the Army, Navy and Air Force will be reduced to 24, 26 and 28 months, respectively. Those who posted to alternative forms of civil service such as firing stations and riot police instead of serving in the armed forces will receive the same benefits. The servicemen who began their duties after August in 2001 will see their service period cut by several weeks. It is the first time such a reduction has taken place in 10 years, after the nation's military service period was slashed by four months in 1993. Korean men typically experienced 36 months of mandatory military service shortly after the 1950-1953 Korean War. The current reduction was one of President Roh Moo-hyun's campaign pledges. He promised to cut the compulsory service by four months in two staggered stages. The Defense Ministry has said the South Korean military will make up for the changes in the service period by establishing "digitalized" forces and having noncommissioned officers take over all skilled positions.

From http://www.koreaherald.co.kr/ 08/13/2003

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Consumer Protection Bill to Be Submitted

The Ministry of Finance and Economy (MOFE) yesterday said it will submit a bill on consumer protection to the National Assembly this year. If passed, the government would be empowered to issue public alerts on faulty consumer goods from next year. ``So far the Korea Consumer Protection Board has often informed the public of the risk of a certain product based on consumer complaints, but when legal conflicts between consumers and makers of flawed products take place, there have not been rules to protect consumers,'' the MOFE said. The MOFE will take the role of warning against defects in products through an evaluation committee. The committee's decisions will be based on information handed over by 57 information collecting-organizations such as hospitals and fire stations nationwide. The government also seeks ways to make it compulsory for manufacturers to inform consumers of risks related to their products in advance. ``To implement this, we are planning on setting up a center for consumer safety,'' an MOFE official said. ``The consumer protection law is designed to support other public protection laws like the automobile management act and fire services act,'' the official said. However, manufacturers argued that the measures will inhibit their business activities. (by Seo Jee-yeon)

From The Korea Times 08/17/2003

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Ministry Doubles Budget for the Green School Program

The Ministry of Planning and Budget (MOPB) announced Wednesday (August 13) that it will double the budget for the "green school" program, allocating 3 billion won ($2.5 million) in the 2004 budget. Under the multi-year program the brick walls around school grounds will be replaced with trees, shrubs and lawns so that students and citizens may have a more natural access to schools and enjoy a more environment-friendly atmosphere. The Korea Forest Service (KFS) is in charge of the program, which first began in 1999. Each of the schools supported under the program receives 30 million won for three years to make their schools "greener." This year, 150 schools have received the funds, and the ministry plans to double that number in 2004.

From http://www.kois.go.kr/ 08/18/2003

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5-Day Workweek to Begin Next July

The controversial five-day workweek system is likely to be dealt with in the National Assembly plenary session around Aug. 28, as an Assembly subcommittee yesterday approved the government-submitted bill, despite fierce opposition from the labor sector. A legislation-reviewing sub-panel under the Assembly's Environment and Labor Committee passed the shorter workweek bill, with the original government plan left almost untouched. The panel only postponed the implementation of the new system by one year. The Environment and Labor Committee will pass the bill in a general meeting today. According to the bill, the five-day workweek system will be introduced from July 1, next year, and be applied to all workplaces in the nation by 2011 in stages. Employees will get 15-25 days of paid annual leave, without pay-cuts for the shortened working hours. Two major floor negotiation groups _ the ruling Millennium Democratic Party (MDP) and the main opposition Grand National Party (GNP) _ agreed to pass the bill in the Assembly plenary session yesterday, as labor and management had failed to reach an agreement on revising the bill, despite arbitration by the Assembly. Labor wanted the shorter workweek adopted this year and fully implemented by 2005, while management insisted on starting the system in 2005 and applying it fully in 2012. For annual leave, union representatives proposed 18 to 27 days, while management wanted to reduce the figure to between 15 and 22 days. Until early yesterday, rival parties were unable to bring the issue to the table for deliberation in the standing committee. The focal point of the foot-dragging in negotiations was the extent to which the government's bill should be revised. Representing middle and lower income brackets, the liberal MDP wanted to reflect the outcome of labor-management negotiations so far, revising the original government bill in favor of workers. However, the opposition GNP, which leans more toward support for corporations than laborers, favored passing the bill without significant modification. After several rounds of negotiations, the MDP agreed to pass the government bill without drastic changes. The seemingly ironic situation, in which the opposition has stuck to the government policy and the ruling party has tried to change it, came as several powerful trade unions have been winning in their struggle to reduce working hours, putting management in a difficult situation. To help the business community, the conservative GNP moved to handle the bill as early as possible. (by Ryu Jin)

From http://times.hankooki.com/ 08/20/2003

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INDONESIA: House OKs Constitutional Court Bill

The House of Representatives unanimously approved the constitutional court bill on Wednesday. The House avoided a vote after members agreed that judges sitting on the court must have law degrees and that laws are subject to judicial review. Deputy House Speaker Soetardjo Soerjogoeritno banged the gavel to mark the endorsement of the bill at around 11 p.m. ending a lengthy debate that started early in July. Only 270 out of the House's 497 members attended the plenary session that passed the bill. In a departure from normal procedure, the bill was deliberated outside the House sitting period as the legislators and the government raced to meet the Aug. 17 deadline set by the amended Constitution for the establishment of the court. Minister of Justice and Human Rights Yusril Ihza Mahendra, in his closing remarks, said the bill would be presented to President Megawati Soekarnoputri on Thursday for her endorsement. The bill says the president, the House and the Supreme Court each selects three judges to sit on the court. Previously, the House factions were split over the required education levels of the judges. While other factions demanded a judge have a law degree, the Reform faction insisted that professionalism and a good knowledge of the Constitution was more important than a degree. The final draft of the bill says the Constitutional Court is authorized to carry out judicial reviews of laws enacted after the first constitutional amendments in October 1999. The Indonesian Democratic Party of Struggle had demanded that all laws be subject to judicial review. The Constitutional Court will have the authority to review laws, to judge on disputes between state institutions, to dissolve political parties, and to resolve electoral disputes. The court also has the authority to decide allegations by the House of Representatives that the president and/or vice president committed treason, corruption, bribery and other crimes that endanger the state. (by Kurniawan Hari)

From http://www.thejakartapost.com/ 08/07/2003

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Govt Drafts Law on Public Sector Procurement

The government is currently drafting a law on public sector procurement as part of efforts to help curb rampant corruption in the country. The law, which someday will replace Presidential Decree No. 18/2000 on public sector procurement, will ensure severe punishment for corruption in the process. State Minister of National Development Planning Kwik Kian Gie said on Thursday that the presidential decree was deemed not effective enough to ensure that corruptors got heavy punishment. He was speaking in a speech at a gathering of government and business officials discussing trade liberalization issues. A government special team has completed a revised version of the above presidential decree to help boost transparency in public sector procurement, but the revision has yet to be approved by President Megawati Soekarnoputri. Kwik said that, so far, procurement had often been carried out in an inefficient way and sometimes the process was not transparent. Both the revised decree and the bill are aimed at gradually turning Indonesia into an efficient economy rather than the high-cost economy it is today, in response to widespread leakage at almost every stage of the procurement process. Various international institutions -- including the World Bank and the Asian Development Bank -- have frequently stated that corruption in equipment procurement in government institutions is one of the areas most tainted by corruption in Indonesia. The World Bank even suggested that leakage in the procurement process could account for up to 50 percent of all funds allocated for procurement. "The procurement process should be monitored tightly," Kwik said. "And to promote efficiency and transparency in the procurement of goods and services, reward and punishment should be implemented. Therefore, a law that has more severe penalties is needed." The revised decree has sparked some protest from business associations, as under the decree, contractors will be allowed to win procurement projects without having to be accredited with either the Indonesian Chamber of Commerce and Industry (Kadin) or its affiliated associations. Previously, a source at the National Development Planning Board (Bappenas), where the revised decree was deliberated, said that the certification process was prone to abuse and bribery. Similar to the revised decree, the bill also aims to support small enterprises entering bids for procurement projects. In the revised decree it is stated that medium- to large-scale enterprises are prohibited from participating in tenders for projects reserved for small businesses, that is, projects worth less than Rp 50 billion.

From http://www.thejakartapost.com/ 08/08/2003

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House Set to Discuss 30 Bills Next Session

After enjoying a six-week break, the House of Representatives (DPR) on Friday opened a new session and promised to finish the deliberation of some 30 bills, including the ones that could not be finished in past sessions. In his speech marking the opening of the session, House Speaker Akbar Tandjung acknowledged that the House had been criticized for its poor performance in legislation. "However, we'll try hard to overcome the hurdles and improve our performance," Akbar, who was convicted of corruption last year, said at a plenary meeting attended by President Megawati Soekarnoputri here. The current session will last from Aug. 15 to Sept. 26, meaning that the House must endorse nearly one bill a day if it wants to achieve its legislation target. Akbar made the excuse that the poor legislation record was due to the House's willingness to accommodate public aspirations during the deliberation of bills. He also blamed the government for its tardiness in appointing related ministers to deliberate on the bills drafted by the House. The record shows that the House has not been able to meet its target of legislation in even one of its sessions to date. Since January 2002, the House has always missed its legislation target. Of the targeted 41 bills in the April-July session, the House only endorsed five bills. Legislators and the government had to work during recess to meet the deadline for the establishment of the Constitutional Court. Among the bills to be finished during this session are bills on Batam's free-trade and free-port, agriculture, on doctors, the protection of Indonesian workers abroad and sports. The legislators will also work on the State Budget which is to take effect in January 2004. Regarding the deliberation of the State Budget 2004, Akbar said that the government must take several key priorities into account, such as efforts to keep economic growth sustainable, human rights development, poverty eradication, food security, political stability, corruption, defense and security affairs, development in underdeveloped areas and forest conservation. Akbar added that the House would host a conference of ASEAN Inter-Parliamentary Organizations (AIPO) in September. The five-day conference will deal with problems in politics, economics and regional security. Following the AIPO conference, there will also be a meeting of the executive committee of the parliament of the Organization of Islamic Conference (OIC) members. In a plenary session attended by only 263 of 500 House members, Akbar condemned the bomb blast at the American-run JW Marriott Hotel on Aug. 5. He also conveyed his condolences to the relatives and victims of the bomb blast. (by Kurniawan Hari)

From http://www.thejakartapost.com/ 08/16/2003

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MYANMAR: National Tuberculosis Programme Coordinated

The Workshop to Formulate Operational Guidelines for Involvement for Private Practitioners in National Tuberculosis Programme of Myanmar was opened at the hall of Myanmar Medical Association on today, with an address by Minister for Health Dr Kyaw Myint. Also present on the occasion were President of Myanmar Maternal and Child Welfare Association Dr Daw Khin Win Shwe, officials, WHO Resident Representative Dr Agostino Borra and officials of UN agencies, and others.

From http://www3.itu.int/ 08/01/2003

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MALAYSIA: Cabinet May Ratify Tobacco Control Treaty

Tighter controls on tobacco advertising and an increase in taxes will be among the actions that the Government will take if the Cabinet decides to ratify the Framework Convention on Tobacco Control (FCTC) treaty. Health Minister Datuk Chua Jui Meng, who will submit a memorandum on the FCTC to the Cabinet tomorrow, said: "Whether Malaysia will become a signatory to the FCTC, which was approved by the World Health Organisation at its general assembly in Geneva in May, will be decided by the Cabinet." If the Cabinet accepts the memorandum, Malaysia will sign the agreement at the United Nations headquarters in New York during the UN General Assembly in October. "The signatories must be either the Prime Minister, the Foreign Minister or the Health Minister," he said after launching the National Association of Malaysian Life Insurance and Financial Advisers' national-level blood donation campaign at the ministry. The FCTC, which took four years to be drafted, sets international standards for tobacco controls with provisions on advertising and sponsorship, tax and price increases, labelling, illicit trade and second-hand smoke. Signatories are expected to incorporate treaty elements into their national laws. They are free to legislate the FCTC at higher thresholds, but are obliged to refrain from acts that would defeat the treaty's purpose. "We have been given one year, from June this year until June next year to make a decision. "But the ministry has decided to submit the memorandum tomorrow for the Cabinet to make a decision," he said. On May 24, 1999, the World Health Assembly (WHA), the governing body of the World Health Organisation (WHO), paved the way for multilateral negotiations to begin on a set of rules and regulations that will govern the global rise and spread of tobacco and tobacco products in the next century. The 191-member WHA unanimously backed a resolution calling for work to begin on the FCTC, a new legal instrument that could address issues as diverse as tobacco advertising and promotion, agricultural diversification, smuggling, taxes and subsidies. A record 50 nations took the floor to pledge financial and political support for the convention. The list included the five permanent members of the United Nations Security Council, major tobacco growers and exporters as well as several countries in the developing and developed world, which face the brunt of the tobacco industry's marketing and promotion pitch. The European Union and five non-governmental organisations also made statements in support of the convention and the director-general's leadership in global tobacco control. Chua said Malaysia was one of the nations that took initiatives to launch anti-smoking campaigns, coming out with regulations and laws to discourage people from smoking. "There are some 10,000 Malaysians who die annually because of smoking. The Government is concerned over the effect of tobacco on people's health." He said Malaysia had taken proactive measures to stop direct and indirect advertisement of tobacco except in sports. "I came to understand that the tobacco industry is now resorting to new tactics to promote their cigarettes. My officers will be meeting them soon to put a stop to their activities," said Chua, declining to say what the new tactics were. According to an AFP report yesterday, WHO's new director-general, Lee Jong Wook, said developing countries posed the toughest challenge to the fight against tobacco use, especially because women there increasingly lit up. He was quoted as saying that tobacco killed 4.9 million people every year. Most of these people are in poor countries. The WHO estimates that the global death toll from smoking will double to 10 million in 2030, if the increase in the use of tobacco continues unabated. (by Annie Freeda Cruez)

http://emedia.my.com 08/13/2003

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Ministry to Curb Wildlife Smuggling

The Science, Technology and Environment Ministry will beef up enforcement on illegal trading and smuggling of wildlife and wildlife products at the Kuala Lumpur International Airport to outdo smugglers "who have become smarter now". Minister Datuk Seri Law Hieng Ding said: "There are certain things that are allowed to be traded and there are certain things listed as protected items. Sometimes they (smugglers) mix them (to avoid detection)." "I have asked my officers to tighten up enforcement and also work with the Customs and other departments," he said after opening the Exotic Cats and Birds Exhibition at the National Museum here yesterday. He said efforts were ongoing and the ministry would look into ways to clamp down on smuggling of wildlife.

From http://202.186.86.35/ 08/22/2003

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Amendment Allows Party to Set Up Sub-Branches

Gerakan will have sub-branches in addition to its existing structure comprising national, state, division and branch level with the amendment to its party constitution yesterday. The amendment was passed in line with the party's reorganising and expansion plan at the end of the national delegates conference here. The party increased the number of branches allowed under each division, which corresponds to a parliamentary constituency, from 12 to 18 branches. Each branch, which corresponds to a polling district, is allowed to establish up to 12 sub-branches with a minimum of 20 members each. A chairman and six committee members will lead the sub-branches or branch bureaus. The amendment also increased the number of minimum branches required in a division established in a parliamentary constituency from two to four. However, the number of members to be selected to join the Central Committee has been reduced from 18 to 12.

From http://202.186.86.35/ 08/25/2003

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PHILIPPINES: Guidelines to Avoid SARS Return Issued

Labor Secretary Patricia A. Sto. Tomas has issued guidelines on the prevention of the Severe Acute Respiratory Syndrome (SARS) in workplaces, saying that SARS may have been contained but its resurgence is still possible if prevention measures are not strengthened. The guidelines, contained in Department Order No. 47-03, Series of 2003, apply to workers and employers in the private sector, and are aimed at strengthening SARS precautionary measures and institute long-term safeguards against the threat and its recurrence. "We cannot rest easy on the existing threat of SARS," Sto. Tomas said. "While the Philippine continues to be SARS-free with zero local transmission, we must remain alert and vigilant." Under the guidelines issued by Sto. Tomas, the employers are enjoined to : 1. Clean the work area with household disinfectant and make sure that water, soap and disinfectants are available in all washrooms and toilets. 2. Stress good hygiene practices among workers like washing their hand frequently, covering their nose and mouth when sneezing and coughing, spitting at proper places. 3. Monitor the health of workers particularly those with fever and those who have traveled to countries affected with SARS virus. In the absence of the new SARS disease in the list of compensable diseases, the order provides that workers' leave of absence due to SARS may be charged to their order annual sick/vacation leave credits under the company policy/practice or as stipulated in their collective bargaining agreement (CBA). In case the worker's leave credits have been used up, employers could consider granting leave of absence without pay. The order also provides that the Research Institute of Tropical Medicine (RITM) and the San Lazaro Hospital (SLH) shall shoulder all hospitalization expenses of SARS cases confined in these hospitals. In addition, the Philippine Health Insurance Corp. (PHIC) shall provide P100,000 medical insurance package over and above the usual health insurance benefits for public and private health workers infected with SARS. Other Phil Health members and their dependents infected with SARS will also be covered by hospitals benefits amounting to P50,000. According to the order, a worker who contracts SARS in the performance of his/her duty is entitled to sickness benefits under the Social Security System and employes compensation benefits under Presidential Decree 626. (by E. T. Suarez)

From http://www.mb.com.ph/ 08/16/2003

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House OKs 52 Socio-eco Measures

The House of Representatives has approved on third and final reading 52 socio-economic measures topped by the move to extend the life by another five years the Agriculture and Fisheries Modernization Act of 1997 under HB 5817. "Food security, among others, remains a priority of government,'' Speaker Jose de Venecia declared as he urged the Senate to support the House move extending the life of the expiring AFMA from six to 11 years from 1997. Of the 52 measures 16 were of national significance, 28 bills were of local importance, and 8 were franchise measures. Those approved on third reading also included HB 5713, granting tax incentives on Capital Equipment; HB 5888 which would mete the death penalty on acts leading to terrorism; HB 6001 which would establish a Provident Personal Savings Plan to be known as the Personal Equity and Retirement Account (PERA); and HB 6023 prohibiting the detention of live or dead patients in hospitals and medical clinics on grounds of non-payment of hospitals bills. The local bills would provide for public works projects in Nueva Ecija, Zamboanga del Norte, Iloilo, Oriental Mindoro, Palawan, Benguet, Davao del Sur, Maguindanao, Sarangani, and Sulu; reclassify timberlands for disposition and conversion; and establish state universities and high schools in the Visayas and Mindanao. Even as national focus continues to be on the growing move to revise the Constitution through a constituent assembly and other social and economic reforms, Speaker De Venecia emphasized that national agricultural productivity will not be neglected. "Food security is a priority responsibility of government. Extension of AFMA's life is most logical,'' De Venecia stressed, adding "we have to ensure all vital legislative support to the food program of President Arroyo.'' Underlining agricultural productivity role in rural development and job generation in the countryside, the House Committee on Agriculture chaired by Rep. Alfredo Maranon and House Committee on Appropriations headed by Rep. Rolando Andaya Jr. jointly sponsored the measure during plenary debates until its second reading approval before the June 5 adjournment. Lauding the speaker's full support for the extension, Maranon original author of the bill, said under the AFMA (Republic Act No. 8435) the amount of R20-billion was appropriated as an initial funding for the first year of implementation and an additional amount of not less than R17-billion annually for the next six years of its implementation. (by Ben R. Rosario)

From http://www.mb.com.ph/ 08/18/2003

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Bicam OKs Dual Citizenship Bill

The Dual Citizenship Bill has finally hurdled bicameral scrutiny, and is expected to be signed into law by the President next week as soon as the two chambers of Congress ratify the final version adopted by the bicameral conference committee last Monday. Senate President Franklin Drilon said the reconciled version of the measure - from Senate Bill 2130 and House Bill 4720 - is expected to be enacted Monday next week. SB 2130 and HB 4720 were passed on third and final reading late last year and last June, respectively. The Senate leader noted that the support given by House Speaker Jose de Venecia has effectively helped in rendering the eventual passage of the bill until the bicameral level. The bill, the Citizenship Retention and Reacquisition Act of 2003, would restore Philippine citizenship to former naturalborn Filipinos who have embraced foreign citizenship out of necessity, mostly to legal requirements of host countries. But it would exempt from income taxes the salaries of overseas Filipinos, including the dual citizens. Drilon said the bill is expected to bring in investments from Filipino-Americans who would be encouraged to return to the Philippines to either invest their money and expertise or eventually settle down here. In the United States alone, close to a million Filipinos would benefit from the bill, he said. Except for the provision that would require former Filipinos to take an oath of allegiance to the Republic, for the re-assumption of their original citizenship, Drilon said, all clauses of the bicameral version of the Dual Citizenship bill were taken from the SB 2130.The passage of this bill is an affirmation that Filipino people embrace our Filipino brothers abroad and that we highly appreciate their continued contribution in keeping our economy afloat," he said. "Like the Overseas Absentee Voting Act of 2003, the dual citizenship bill is another tribute we offer to the overseas Filipino community," Drilon added.He said the landmark legislation is expected to stir heightened interest among former Filipino citizens in the country's political, social and economic affairs, and boost investments and domestic tourism. The Senate chief noted that the bill has been "long overdue, and is an affirmation of the fact that the vast majority of Filipinos abroad remain Filipinos in their heart and mind. "The bill seeks to revise the 67-year-old law on Philippine citizenship, which provides that natural-born Filipinos who become naturalized citizens of another country automatically lose their Philippine citizenship. Drilon said the Philippine laws should take cognizance of the fact that majority of Filipinos who migrated abroad did so far better opportunities for themselves and their children. "And those who became citizens of their adopted country have done so mainly for economic reasons, or for broadening career opportunities, or for maximizing their social security and protection," he pointed out. Drilon said that at least 89 countries allow some form of dual or multiple citizenship including the United States, United Kingdom, Canada, France, Switzerland, Germany, Ireland, Russia, Cambodia, Taiwan, Vietnam an 14 of 17 Latin American nations. "Even such staunchly nationalistic countries as Israel and Cuba allow their citizens to retain their citizenship after being naturalized in another country," he added. Car excise taxes The Senate ratified yesterday a bill that would impose a new set of excise tax rates on automobiles, which Congress expects to generate an additional P220 million in government revenue over the present sum being collected from the current excise tax rates. Voting 10-3-1, the Senate adopted the bicameral conference committee's version of the bill, which brought down excise tax rates originally proposed by the Senate supposedly to enable the government to earn an additional P1.2 billion. The Senate was divided when it ratified the bill, after Sen. John Osme?a questioned the failure of the Senate contingent in the bicameral body, to defend the original tax rates in the bill approved by the chamber. He said Sen. Ralph Recto, chairman of the Senate contingent, should have kept the Senate figures intact, or at least agreed on figures close to the original approved by the Senate. Osme?a said Recto had apparently yielded to the demands of their counterparts from the House of Representatives considering the significant cut in the Senate-approved excise tax rates, which has brought down the supposed government revenue from automobile excise tax, to a figure even lower than that projected by the House of Representatives itself. The House version was expected to generate some P950 million in revenue, a figure way above the total sum collected under the present set of excise tax rates. Recto said he did not insist on maintaining rates earlier approved by the Senate because they were "unrealistic." For this, the leadership decided on a vote. The bill was approved with Senators Osmena, Aquilino Pimentel, and Loi Estrada casting dissenting votes, while Senator Vicente Sotto III abstained. (by Gabriel S. Mabutas)

From http://www.mb.com.ph/ 08/19/2003

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THAILAND: PM Issues Surprise Anti-terror Decrees

Prime Minister Thaksin Shinawatra yesterday rushed into law new anti-terrorist legislation ahead of the major gathering of world leaders for the Apec meeting here in October. The surprise executive decree, an amendment to Thailand's penal code, was promulgated by the Cabinet in the wake of last week's hotel suicide-bombing in Jakarta. "We need to be quick to issue the [anti-terrorism] law because problems have been occurring in our neighbouring countries. If Thailand is slow, we could be a safe-haven for terrorists," said Thaksin. Many believe that the regional terrorist network Jemaah Islamiyah (JI) was responsible for the car bombing of the JW Marriott Hotel in Jakarta, which killed 11 people and injured about 150. JI has been found to have some links in Thai-land. The changes to the law provide the government with the legal instruments to tackle terrorism. The decree defines a terrorist act as any violent act which causes damage to life, personal freedom, public infrastructure or state and private properties as well as causing serious harm to the economy. Money-laundering laws have also been modified to include terrorism. This will permit the state to freeze assets of suspected terrorists. Deputy Prime Minister Vishanu Krua-ngam said that the Cabinet decided to expedite the anti-terrorist law because of the hotel bombing in Jakarta. Thailand could no longer underestimate the threat of terrorism, particularly with the country hosting the Asia-Pacific Economic Cooperation (Apec) meetings in October, he said. Among those expected to attend are US President George W Bush, Chinese Premier Hu Jintao and Russian President Vladimir Putin. During his trip to Washington in June, Thaksin promised Bush he would implement the legal instruments required to fight terrorism effectively. Panitan Wattanayakorn, a security expert, urged the |government to not only introduce new legislation but also |to improve existing security mechanisms and increase cooperation on security to combat terrorism. "The decree is only a short-term solution to the problem of terrorism. What we need are long-term measures to tackle terrorism more effectively. The government needs to increase budgets for security agencies and increase security cooperation with foreign governments," he said. Panitan, a lecturer at Chulalongkorn University's Faculty of Political Science, said the government's move could raise questions, as it issued the decree despite the fact that it has all along denied the presence of terrorists in Thailand. "The government has claimed that there are no terrorists on Thai soil, but [then] it issued the decree to get rid of terrorists," he said. Meanwhile, Somchai Homla-oh, secretary general of Forum Asia, said that the government had set a very bad precedent in passing legislation that would have such a major impact on Thai society. He said that with Parliament currently in session, the House of Representatives and the Senate should be given the opportunity to vet the proposed amendments. He also warned that the surprise move could pave the way for the government to use executive orders to pass more new laws. Opposition leader Banyat Bantadtan said the terrorism situation in Thailand was not serious enough to warrant the government's use of the executive decree. He said he disagreed with the decree as it provided no channel for debate and contradicted the premier's earlier claims that there were no terrorists in Thailand.

From http://www.nationmultimedia.com/ 08/12/2003

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Move to Repeal Legislation

Critics of the 11 controversial economic laws have renewed calls for their abolition now that Thailand had paid its debts to the International Monetary Fund. Two senators, Prateep Ungsongtham Hata and Maleerat Kaewka, said the time had come for the government to repeal the laws. They were speaking during a senate debate on a bill revoking 47 obsolete laws. ``Now that Thailand owes the IMF nothing, why continue to have those laws as a thorn in our side?'' they said. The laws were issued by the Chuan Leekpai government in 1999 at the behest of the IMF, which approved a bailout package worth US$12.29 billion to save Thailand's crisis-hit economy. Critics say the laws enslaved Thailand because they dictated how the country must run its business and financial systems. Thais were forced to shoulder huge debts of the private sector. The alien businesses law caused 250,000 local grocery stores to fold as it supported proliferation of foreign superstore chains, while the bankruptcy law hurt borrowers.

From http://www.bangkokpost.net/ 08/24/2003

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VIET NAM: President Lauds Justice Ministry Reform Plan

President Tran Duc Luong has praised the Ministry of Justice for trying to solve outstanding civil court cases with a new decentralisation plan. The ministry is currently the only agency responsible for ensuring the verdicts in civil cases are carried out. Speaking with ministry officials on Wednesday, Luong agreed to the ministry's proposal to decentralise the execution of court verdicts to district and village administrations, keeping the ministry in a supervisory role. He said he was delighted to see the ministry had found a way to solve the problem by involving local administrations and mass organisations to ensure court verdicts are carried out quickly in civil cases. Luong said the justice ministry should encourage the public to help it solve all outstanding cases within two years. Luong also addressed Justice Minister Uong Chu Luu's report, which outlines efforts to draft a judicial expertise ordinance and the establishment of two new academies - the National Forensic Institute and the Legal Training Institute. The training institute has been proposed to introduce standardise training for civil and criminal court officials. Luong said the institute would be of great help because it would provide standardised training for all court posts in Viet Nam. He said he would request the National Assembly Standing Committee and Government enable the Legal Training Institute to operate as soon as possible. In referene to forensic examinations, he said all sectors involved should work together to maximise available expertise and equipment. The president welcomed the ministry's intentions to disseminate information about the legal system to the general public, saying it was indispensable in making Vietnamese citizens understand the need to live and work according to laws. He said Viet Nam had become a socialist state governed by laws, so all Vietnamese should understand this. Luong, in his capacity as chairman of the Central Judiciary Reforms Committee, told Luu and the officials he appreciated their efforts to meet the Party and State's demands for judicial reforms.

From http://vietnamnews.vnagency.com.vn/ 08/14/2003

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INDIA: Govt Not to Adopt IPO as Divestment Policy

NEW DELHI: The government has denied that it has decided to adopt the policy of issuing Initial Public Offer (IPO) for disinvestment of public sector undertakings instead of the old method of strategic sale of equity shares. Replying to a question by Ajoy Chakraborty in the Lok Sabha on Wednesday, Law, Commerce and Industries Minister Arun Jaitley said that the government approved the disinvestment strategy as appropriate, including both strategic sale and public offer either independently or jointly depending on specific requirements of each case. He added that the government had approved the disinvestment of Bharat Petroleum Corporation Ltd (BPCL) through a public offer of 25.2 per cent of the equity through American Depository Receipts (ADRs) and 10 per cent in the domestic market. The disinvestment of Dredging Corporation of India Ltd (DCI) through a public offer of 20 per cent of the equity has been approved. The government has also decided to sell its residual shareholding through the offer for sale route in five PSUs - CMC Ltd, Videsh Sanchar Nigam Ltd, IBP Ltd, Indian Petrochemicals Corporation Ltd and Bharat Aluminium Corporation Ltd - which were earlier disinvested through strategic sale. Jaitley replied to the question by Chakraborty as Disinvestment Minister Arun Shourie is away in Montreal to attend the WTO meeting.

From http://timesofindia.indiatimes.com/ 07/30/2003

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Govt Okays Delhi Statehood, Bill in Monsoon Session

The Centre has agreed in principle to grant full statehood to Delhi. A Bill amending the Constitution is likely to be introduced in Parliament during the current session. The decision was taken at a high-powered meeting chaired by Deputy Prime Minister L.K. Advani recently. An announcement is likely to be made shortly. According to sources, the Centre has ruled out a clear-cut division of Delhi as two separate entities and has concurred with the BJP view that the city's basic character should remain unchanged. However, keeping in view the requirements of the New Delhi Municipal Council (NDMC) area which includes the Diplomatic Enclave and residences and offices of the Union government, the proposal seeks to give special responsibility of managing the civic affairs of this area to the Centre's man - the governor. It could not be immediately known if the number of seats in the Assembly will be increased. With elections to the Assembly due later this year, the BJP reckons that full statehood status will boost its chances. Though the Congress never promised statehood in its manifesto, political compulsions have forced it to pass a resolution in the Delhi Assembly, demanding full statehood. However, the party's view articulated by some senior leaders is that Delhi being the national Capital, it can never be given full statehood like other states.

From http://www.hindustantimes.com/ 07/29/2003

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Vajpayee Invites Pakistan to Join Peace Efforts

NEW DELHI: Indian Prime Minister Atal Behari Vajpayee invited Pakistan on Friday to walk a potentially "bumpy" road to peace with his country but also slammed Kashmir's quest for self-determination as communally inspired and therefore untenable. Speaking from behind a bullet-proof screen at the rain-drenched Red Fort to celebrate India's 56th Independence Day, Mr Vajpayee made a clutch of friendly overtures to Pakistan, dwelling on the theme much longer than any other issue he covered in 25 minutes. Opposition parties, including the Congress and the Left Front slammed the speech for lacklustre, but they all uniformly welcomed the approach of peace towards Pakistan. "Our frequent initiatives to normalize relations with Pakistan are not a sign of our weakness," Mr Vajpayee said. "Rather, they are an indication of our commitment to peace." He said in recent months there had been modest progress in normalizing relations with Pakistan. But "terrorist activities are still continuing." The test of Pakistan's sincerity for peace, he said, "lies in whether (it) is prepared to stop cross-border terrorism totally. We hope Pakistan abjures its anti-India outlook. The people of both countries wish to live in peace." He said India and Pakistan had spent some 50 years fighting. "How much more blood shall we spill? The two of us need to combat poverty, unemployment and backwardness." Repeating India's thrust for closer economic cooperation, an issue that looms large over the future of bilateral ties as well as over Saarc, Mr Vajpayee said: "We should increase trade and economic links between our two countries. When we share a 2,000 kilometres long border it makes no sense for us to trade via a third country." In an indication that the existing niggling travel facilities between the two countries are likely to receive an early boost, Mr Vajpayee said: "Let people travel to and fro. Let more and more elected representatives visit each other's country. Let us expand bilateral cultural relations." Recalling the warmth that the two-year old Pakistani girl Noor Fatima had received in India recently, Mr Vajpayee said this burgeoning was something that "our friends in Pakistan should understand." He said: "Let us open some new doors and new windows in the walls that divide us." "On the occasion of Independence Day of both our countries I invite Pakistan to walk together with India on the road to peace. This road is decidedly bumpy. There are even mines strewn along this path. Yet, once we start walking, we will find the hurdles getting out of our way," he said. Mr Vajpayee spoke at length about recent developments in Jammu and Kashmir and about India's quest to establish peace in the region. The prime minister who had revived the current peace moves with Pakistan from Srinagar in April, said he would visit the state again this month, possibly to boost a dialogue with local leaders. "The people of Jammu, Kashmir and Ladakh have faith in democracy. They want peace. They would like to see happiness return to their lives," Mr Vajpayee said. But, he added: "Those people who, while talking about Kashmir, advocate the right to self-determination, wish to divide India on communal lines for the second time. They will not be allowed to succeed in this." Analysts noted that Mr Vajpayee had emphasized the fact this year more than a 100,000 tourists had gone to Jammu and Kashmir and that there was a large turnout of pilgrims going on the Hindu Amarnath pilgrimage. He said nearly 6,000 students from different parts of India are today studying in Kashmir. "Next week, we shall launch mobile telephone services in the state." All this would not be possible had armed militancy not abated substantially in the region, the analysts said. While much of his speech was conciliatory and mild, Mr Vajpayee maintained that India's nuclear prowess was something to applaud.

From http://www.dawn.com/ 08/16/2003

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Cabinet Approves India's Deals with China

NEW DELHI: The Central cabinet on Saturday approved the Memorandum of Understanding on cooperation in the field of justice between India and China. The MoU was signed in Beijing by External Affairs Minister Yashwant Sinha, on June 23 this year during Prime Minister A B Vajpayee's China visit. The agreement is between India's ministry of law and justice and the Supreme People's Prosecution Service of People's Republic of China. The memorandum provides for promotion on areas - of information on legal matters; exchange of experience and best practices in the field of justice in the two countries; mutual support for training of public prosecutors and auxiliary judicial personnel; exchange of information on drafting of laws and implementation of legal provisions. Similarly the Cabinet also approved the signing of an agreement between India and Kuwait on mutual legal assistance in criminal matters. The Agreement was initiated on June 5, 2002. India has already signed similar agreements with the UK, Canada, Russia, France and the USA. The objective of this agreement is to improve the effectiveness of both countries in the investigation, prosecution, and suppression of all types o crime and tracing, restraint, forfeiture or confiscation of the proceeds and instruments of crime, through co-operation and mutual legal assistance in criminal matters. The Cabinet also approved the signing of an agreement on cooperation in tourism between India and Malaysia to promote tourism between two countries. As per this agreement both parties will be subject to the relevant laws, rules and regulation applicable in each country, encourage the development and expansion of tourism industries in both countries. With a view to promote and facilitate tourism cooperation both countries will consider having exchange programs in the field of research and development and training etc. (by Bisheshwar Mishra)

From http://timesofindia.indiatimes.com/ 08/23/2003

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SRI LANKA: Land Ownership Act Receives Cabinet Approval

The Land Ownership Act, which guarantees clear land ownership to 1.2 million landless people in the country received Cabinet approval yesterday. Accordingly, the Bill will be presented in Parliament next month. The Cabinet approval to the this Act had been long delayed consequent upon the dissatisfaction of President Chandrika Bandaranaike Kumaratunga who objected to it on several grounds including the placing of Lands Minister's signature on the title deeds. The President had earlier objected to the placing of the Land Minister's signature on the title deeds and insisted on appointing a committee to make a final decision on the issue. In view of the Government's stand that it is imperative to adopt this Act to pass on its benefits to the masses without delay, the Cabinet decided that the Title Deeds should contain the signatures of both the President as well as Lands Minister Rajitha Senaratne. (by Chatura Vidyaratne)

From http://www.dailynews.lk/ 08/07/2003

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MALVIVES: Cabinet Considers Some Bills the Government Intends to Propose to Parliament

MALE (HNS) -- The Cabinet on Wednesday considered some bills that the government intended to propose to parliament. During the meeting, members deliberated on the bills for the repealing of "The Act no. 18/78 on the Import of Television Receiving Sets to the Maldives", "The Act no. 19/78 on the Use of Radios in the Maldives", "The Act no. 33/78 on the Prohibition of Waste Dumping on the Northern Inner Harbour of Male'", "The Act no. 34/78 on Coral Mining from the Shores of Male'", and "The Act no. 7/85 on the Use of Video Cassette Recorders, Video Cassette Players and Cinema Projectors in the Maldives". The Bills on the repealing of the Acts on the Import of Television Receiving Sets, the Use of Radios and the Use of Video Cassette Recorders, Video Cassette Players and Cinema Projectors were presented to the Cabinet after taking into consideration the ubiquity of these items in the Maldives today, and the fact that many items of greater value were in general use without the requirement for licensing, making existing Laws on the registration of such items obsolete. The Bill on repealing the Act on the Prohibition of Waste Dumping on the Northern Inner Harbour of Male' was presented because, recent arrangements for the maintenance of the inner harbour area of Male' had made requirements under the Law obsolete, and that, as "The Act no. 4/93 on the Protection and Preservation of the Environment" and the Rules and Regulations governed by this Act were applicable to the entire country, there was no need for a Law particular to any island or area. Similarly, the Act on Coral Mining from the Shores of Male' was presented as the development of the Male' coastline and practices in areas such the construction industry had made the Law obsolete. Following the discussions, the Cabinet on Wednesday recommended to the President to present the draft bills to the Peoples' Majilis.

From http://www.haveeru.com.mv/ 08/14/2003

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NEPAL: Cyber Law Soon - Finance Minister

The government is soon introducing a new cyber law to control and regulate electronic dealings and businesses being done through the internet, Finance Minister Dr. Prakash Chandra Lohani said Sunday. "The cyber law is being launched in accordance with this year's budgetary announcement," Minister Lohani said in an interaction on "Electronic Transaction Draft 2060" Sunday. President of Law Reform Commission, Niranjan Thapa said the draft on cyber law was made public in the program feeling the need of such law in Nepal. The draft paper has incorporated provisions of digital signature, and proposal and acceptance of contracts, among others.

From http://www.nepalnews.com/ 08/03/2003

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PAKISTAN: Musharraf Vows Kashmir Issue Will Not Be Sidelined

Pakistan's president, General Pervez Musharraf, says Pakistan will continue to normalise ties with India, but will not allow the Kashmir dispute to be sidelined. President Musharraf says Pakistan will pursue the process of engagement with India on the basis of sovereign equality. He says Kashmir is the core issue plaguing relations between the South Asian nuclear rivals. Both countries claim the Himalayan region in full, and have fought two of their three wars over it since gaining independence from Britain in 1947. President Musharraf says Islamabad will continue efforts for a peaceful solution of the dispute in accordance with the wishes of the Kashmiri people. However, in a foreign ministry statement he has warned Pakistan will not allow the Kashmir issue to be sidelined in its dialogue with India.

From http://www.goasiapacific.com/ 08/01/2003

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Pak Following Deregulated Market Lead Policy

ISLAMABAD, Pakistan: (PNS) - Minister for Investment and Privatization, Dr.Hafeez Shaikh said Tuesday, with no restriction on repatriation of capital, profits and dividends, the country's manufacturing, services, agriculture and social sectors are open for domestic as well as foreign investors. "We are following a completely liberalized and deregulated market lead policy", Hafeez Shaikh told a nine member trade delegation from Singapore who discussed with him possibilities of cooperation in mutually beneficial areas including SMEs, Information Technology and Agriculture during a meeting here.

From http://www.paknews.com/ 08/06/2003

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ARMENIA: Government Approves Antipoverty Program

The Armenian government approved on 8 August a Poverty Reduction Strategy that aims to cut the number of people living in poverty from 50 percent to 19 percent of the population by 2015 by creating new jobs, improved tax collection, and increased public spending, RFE/RL's Yerevan bureau reported. Social benefits will be increased by 400 percent over the next 12 years to reach the official threshold for poverty -- a monthly per capita income of 12,600 drams ($21). Implementation of the program is contingent on the receipt of some $1.2 billion in external loans and grants, according to Deputy Finance and Economy Minister Tigran Khachatrian.

From http://www.eurasianet.org/ 08/11/2003

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BAHRAIN: Free Health Check-Up Is Offered

PEOPLE were given a free medical check-up at a campaign held yesterday at the Bahrain Mall. The campaign was organised by the Bahrain Red Crescent Society's Youth and Junior Committee in co-operation with the Bahrain Nursing Society, Salmaniya Medical Complex (SMC) Blood Bank and the Bilad Al Qadeem Health Centre. The campaign is the second of four campaigns to be held in malls. The first was held at Seef Mall last month. The next campaign will be held at the Dana Mall on August 22 and the last one will be held at Al A'ali Mall on September 4. Committee vice-president Anisa Saad Alhuwaihei said the check-up includes five tests. "The tests we've done are blood pressure, blood sugar, blood type, weight and height," she told the GDN. "Two Red Crescent members distributing leaflets about the society, committee and campaign were stationed next to each entrance in the mall. "Those interested in having a check up done were then guided to where the committee was, near Geant hypermarket. "After completing their tests, the people were given cards showing all the information we found out." Ms Alhuwaihei said the campaign team consists of a doctor, three nurses, a health education officer and a blood type analyst. "The campaign is a voluntarily service for people. It aims to create health awareness and help people know their health conditions," she said. "The doctor and the health education officer will be available to provide those who undertake the tests with the medical advice they require and how to treat their problems, if they have any."

From http://www.gulf-daily-news.com/ 08/08/2003

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GEORGIA: Parliament Again Fails to Pass Election Law

Deputies resumed discussion in the second reading of the amendments to the Election Code on 31 July but again failed to pass them, Caucasus Press and the website of the independent television station Rustavi-2 reported. The sticking point remains the allocation among opposition parties of the nine Central Election Commission seats to which they are collectively entitled (see "RFE/RL Caucasus Report," 1 August 2003). LF

From http://www.rferl.org/ 08/01/2003

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IRAQ: U.S. President Renews Sanctions on Iraq

U.S. President George W. Bush renewed sanctions on Iraq on 31 July, according to an announcement on the State Department website. Bush's father, President George H. W. Bush, placed those sanctions on Iraq in 1990 through an executive order. The sanctions freeze Iraqi government assets held in U.S. banks and bans U.S. trade with Iraq. "Because of the continued instability in Iraq, the United States and Coalition partners' role as the temporary authority in Iraq, and the need to ensure the establishment of a process leading to a representative Iraqi self-rule, the national emergency declared on August 2, 1990...must continue in effect beyond August 2, 2003.... Therefore, I am continuing for one year the national emergency with respect to Iraq," a White House notice signed by Bush read.

From http://www.rferl.org/ 08/01/2003

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IRAN: Parliament Passes Legislation on Campaign Against Money Laundering

TEHRAN -- The Majlis (Parliament) on Tuesday passed a legislation on "campaign against money laundering" to monitor transfer of money and real state transactions, IRNA reported. The legislation obliges owners of the property to provide evidence about the origin of the money being transferred or the money being paid to buy real states or shares in the stock exchange. The lawmakers envisaged adopting effective mechanism to help the respective organizations identify the money coming from wrongdoing, including embezzlement in the government organizations, racketeering or money coming from smuggling of goods or drugs as well as gambling. According to article 3 of the legislation, the owners of the money or real states who fail to provide evidence about their income will be liable to dispossession and paying a fine of at least one-fourth of the total value of the illegal property. The legislation also envisaged procedural discipline for the Office of Registration of the Deeds and Real States to be observed in transactions in which ownership of the real states being transferred. The article 7 of the legislation calls for setting up a special council on "campaign against money laundering" to be headed by the first vice-president and membership of the minister of finance and economy, the minister of commerce, minister of information, minister of justice, head of the management and planning organization (MPO) and the governor of the Central Bank of Iran and the general prosecutor. The legislation entrusted the special council to provide procedural discipline for the legislation. The minister of finance and economy will work as the secretary of the special council whose secretariat will be at the Ministry of Finance and Economy, according to the legislation.

From http://www.tehrantimes.com/ 08/06/2003

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KYRGYZSTAN: Struggle to Stem Smuggling

Uzbekistan, Kazakhstan and Kyrgyzstan agreed on August 1 to improve coordination of border enforcement as a way to lessen the threat of terrorist incursions. However, the countries have made little headway on efforts to fight smuggling. Those engaged in illicit trade in the region are reportedly embracing new techniques for smuggling commodities, particularly gasoline, liquor, medicine and tobacco. Official efforts to combat smuggling have struggled to keep pace with the changing methods of smugglers, whose increased efficiency has been able to drive contraband costs steadily lower. Smuggling thus continues to cost regional governments millions in lost revenue. Kyrgyzstan's response to smuggling underscores the problems. The Kyrgyz government has taken a multi-track approach in trying to combat illicit trade. In April, for example, excise taxes on legally imported gasoline and diesel fuel fell by 50 percent and 37.5 percent respectively, making the state-regulated prices more competitive. The moves came at about the same time parliament approved anti-smuggling legislation that mandated longer jail terms for convicted offenders. In addition to showing smugglers a stick, President Askar Akayev hinted at extending a carrot to get smugglers to change their ways. "We are convinced that it is impossible to do away with the shadow economy by employing forceful methods, therefore it is necessary to make the shadow economy transparent," Akayev said during a conference of entrepreneurs last spring. In some areas, the initial results of these moves have been encouraging. The government reported in late May that the amount of legally imported gasoline and diesel had more than tripled during the first full month the new rates were in effect. In other areas, such as alcohol consumption, the situation is more ambiguous. The Interfax news agency reported that domestic vodka production increased 34 percent during the first quarter of 2003 - the first such increase in several years. At the same time, Interfax, citing figures compiled by the National Statistics Committee, reported that nearly half the wine and beer and 38 percent of the vodka bought by Kyrgyzstani citizens in 2002 came via illegal imports. Ultimately, stemming the flow of smuggled goods would seem to require a regional coordination. Since the Soviet collapse in 1991, however, a lack of cooperation among Central Asian states has helped smuggling to flourish. MPs in Bishkek indicate that domestic anti-smuggling legislation stands only a limited chance for success unless ways are found to stop production at illicit liquor facilities in neighboring Kazakhstan. Currently, Kyrgyz authorities suggest that their Kazakhstani counterparts, knowing that virtually all illegal liquor ends up across the border, do not interfere with illegal production. Rampant corruption among customs officials is also a daunting problem. Anecdotal evidence indicates that customs officers can receive as much as a 30 percent cut of a smuggler's profits to refrain from action that impedes the flow of contraband. At the same time, shifts in smuggling methods are making it harder for authorities to apprehend smuggling kingpins. Many big-time smugglers reportedly hire couriers who live in frontier areas to transport commodities including gas, liquor and medicines across borders in relatively small quantities. Many of these couriers are unable to find other jobs and thus are willing to assume great risks in return for what is a relatively large payout. Very often, the couriers do not even know the name of the smuggler ultimately responsible for their payment, a fact designed to limit the officials' ability to smash an entire smuggling network. (by Vyacheslav Goncharov)

From http://www.eurasianet.org/ 08/05/2003

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New Kyrgyz Labor Code Nears Completion

The Kyrgyz Republic is soon expected to adopt a new code that will bring the country's labor regulations closer to EU law. The TCA talked to Hugh O'Neill, who is advising the Kyrgyz government on drafting and implementation of the code on behalf of the EU, to find out what this will mean for workers and businesses. The main objective of the Labor Code is to increase direct investment, create a decent business climate, and eliminate bureaucracy. In February, O'Neill prepared a report with suggestions on how to comply with EU law, some of which have been adopted. "The code does its best to comply with EU law but certain rights would cost too much, or would require fundamental social change. In particular, it concentrates on health and safety, but includes few of the EU's equality and discrimination provisions," said O'Neill. "In the EU there are four essential elements of labor policy: health, safety, dignity and welfare. It's a pity there was not more emphasis on the dignity of the worker in the workplace." He considers there are also areas where more could have been done for employers: "It's a very substantial step from the planned economy, but it is still not completely compliant with the demands of the market economy. The Code is a big step in that direction but the Soviet mentality is still strong." Greater flexibility would help businesses struggling to adapt to the demands of the market economy. "If the Kyrgyz Republic is to develop into a market economy it must allow flexibility for employers to run their businesses without interference providing they meet health and safety standards. This means minimum bureaucracy," said O'Neill. "This will require a considerable change of attitude on the part of all sectors of society - the code is a step in that direction." Chiefly, employers are concerned that they will need a substantial lead time to comply with its provisions, and that compliance will be expensive. For instance, if someone dies in an accident at work they would receive compensation equal to 20 times their annual salary. "This is exceptionally generous by west European standards, not to mention the US, and it is not known if it has been cost properly, to evaluate the consequences of a major industrial accident," said O'Neill. "As the ultimate guarantor of workers' compensation, the government could find this extremely costly if a company cannot afford to pay." There will be a second reading of the law on labor protection in September, which the President signed on 1 August. The Code should come into effect within 6 months of the law's adoption by the government. Before it enters into force, O'Neill warns that the government must set up a trusted enforcement system that will provide both workers and employers with speedy, impartial justice. Equally important is an information campaign to explain people's rights and obligations under the 400-Article Code: "In the past it has been difficult to get copies of legislation, and people were not informed."(by Clare Nuttall)

From http://www.times.kg/ 08/23/2003

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KAZAKHSTAN: President Has Approved the Government Programme for 2003-2006

The government programme for 2003-2006 has been approved by a decree of the president of RK Nursultan Nazarbayev "On further realisation of Kazakhstan development strategy until 2030". The comments of the prime minister chancellery to this decree say that the present programme has been developed in compliance with the Constitution of RK, according to which each new government must clearly identify the main directions of its activities. The programme tasks and targets, its main directions and priorities aim at a further realisation of the Strategy-2030, an achievement of the purpose indicators of the Strategic plan of country development until 2010, as well as at a resolution of current programme, posed by the head of state before the government. The main target of the programme is a provision of a growth of life level of the population in all regions on the basis of socio-political stability, a stable and constant socio-economic development, a strengthening of economic and ecological security, a decrease of system risks, a development of international co-operation. In the programme for 2003-2006 the government defined the following directions as priorities: a decrease of differences in the level of socio-economic development of the country regions, a decrease of poverty and unemployment, the realisation of State agro-food programme and a qualitative improvement of life conditions in the village, a realisation of the Strategy of industrial innovative development of the country, a stabilisation of environmental quality. There are also an establishment of modern and efficient system of development of science, education, culture and professional qualification of the population, a development of small and medium business, a development of social and industrial infrastructure, a further improvement of social provision and pension payment to the population, an increase of salaries for state and public sector employees, a further development of the capital. The government believes that the realisation of these and other tasks will allow to provide the growth of average annual GDP by 7-7.5%, including in the industrial production - by 9-9.5%, the level of GDP per person to reach in 2006 an amount equivalent to $2,600, the level of average annual inflation to be not more than 4.5-5.5%, the population with incomes lower than the cost of living to decrease to 20%. In general, the comments say, an accomplishment of measures provided by the programme will make the socio-economic processes aiming at an achievement of higher level of country development constant and purposeful. According to the decree by the president of RK, the government must develop and approve a plan of events for the realisation of this programme in a monthly period and provide the information on its realisation to the head of state on a quarterly basis. The full version of the decree and the comments to it have been published in the official media.

From http://www.gazeta.kz/ 08/19/2003

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TURKMENISTAN: People's Council Becomes Highest Legislative Body

President Niyazov has declared that the Halk Maslakhaty (People's Council) is the country's highest legislative body, displacing the parliament, ITAR-TASS and AP reported. Niyazov on 15 August told a meeting of the People's Council in Turkmenbashi City that from now on, the body would decide the fate of Turkmenistan and solve issues of security and statehood. The 2,500-member People's Council's members are a combination of appointed and elected officials and tribal elders. The 50-member Turkmen parliament, the National Assembly, remains, but its powers will be reduced. Also on 15 August, members of the People's Council called for giving Niyazov the title of field marshal of the armed forces and creating an institute devoted to studying Niyazov and his spiritual guidebook "Rukhnama." The first secretary of the political council for the Democratic Party of Turkmenistan, Onzhuk Musaev, delivered high praise for Niyazov: "Dear people, let us always say 'Great Allah' and let us always says 'the Eternal, Great Turkmenbashi.' I beg you people, say 'Great Allah' and let's say 'Eternal, Great Turkmenbashi.'" Niyazov signed a proposal from the People's Council giving the people of Turkmenistan electricity, gas, water, and table salt free until 2020. All are currently rationed and often unavailable.

From http://www.rferl.org/ 08/15/2003

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AUSTRALIA: New Forum Leader Reveals Policy

THE FORMER Australian diplomat chosen to head the Pacific Islands Forum Secretariat says he'll be the servant of the entire sixteen member countries of the Forum, not Canberra's man. Greg Urwin served as an Australian High Commissioner in three Pacific countries Vanuatu and Fiji and Samoa, where his wife is from. From next year, he'll be the top regional bureaucrat with a mandate to try to make the Pacific Islands Forum Secretariat more effective. Urwin says the countries of the region face multiple problems but he's keen to take on the task. "It will require a considerable amount of effort but I'm looking forward to it," he said. He says he sees his role as Secretary General, "As the servant of the people who put me there which is the members of the Forum. Pure and simple." Mr Urwin says he won't be an Australian line on anything because "I'm the servant of the Forum." The Secretary General designate of the Pacific Islands Forum, Greg Urwin, has dismissed suggestions he is an inappropriate representative of the Pacific in its dealings with the European Union. Some Pacific leaders have expressed concern that the EU could regard the Australian as an inappropriate person to negotiate Pacific aid and trade arrangements. But Mr Urwin says that is not the case. "For these purposes I will cease to be an Australian. I will be a servant of those people who have appointed me. And that is the entire membership of the forum. "To the extent that there may be technical things to work through, as I understand them, these are not beyond the wit of man."I have just had some preliminary contact with the EU representative who's here for the post forum dialogues and we've talked about the possibility that, should it prove useful at some stage in the next few months, I would be happy to go to Brussels to talk these issues through," Urwin said. Mr Urwin, a former Australian diplomat, was elected to the position on the weekend in a secret ballot.

From http://www.pacificislands.cc/ 08/18/2003

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Call for EU-Style 'Pacific Community'

Australia and 15 other south Pacific nations should establish a Pacific community similar to the European Union, with the Australian dollar the common currency, a parliamentary inquiry has recommended. The Senate Foreign Affairs Committee's proposal follows Prime Minister John Howard's call for greater regional co-operation and has been released on the eve of a debate in the Pacific Island Forum over the region's future. It is sure to ignite concerns about a new Australian colonialism following military intervention in the Solomon Islands. The inquiry found the region's economic and social problems were worsening and the costs to Australia of inaction would be much greater than the costs of establishing a new community. A common labour market and budgetary standards would need to be adopted. In the interim, the committee backs a program to temporarily import islanders as seasonal labor to work in areas such as fruit-picking. The plan has the support of the ACTU and some business groups. United States Deputy Secretary of State Richard Armitage yesterday backed the idea, as a "recognition of a problem that concerns us all". Mr Howard declined to comment on the plan but told Parliament that, for its own security, Australia must "do all that we can to ensure that our region, our neighborhood, is stable - that governance is strong and the rule of law is just". "The situation in the Solomon Islands is unique but a number of our friends in the Pacific are experiencing economic decline, growing corruption and lawlessness," Mr Howard said. "Failed states can all too easily become safe havens for trans-national criminals and even terrorists. "We have made it plain - nations who look for our assistance, who receive our financial aid, must understand support is now conditional on working to overcome corruption," he said. Mr Howard said the Pacific Islands Forum in Auckland would discuss a regional approach to dealing with Pacific problems, including more pooled support and resources, improving governance and a joint approach to policing. The committee's proposal for a Pacific community, supported by Government and Opposition members, calls for an eminent persons group to be established to meet with Pacific governments and investigate the plan. "If the region continues to decline, the costs to Australia of dealing with the consequences will be much greater than the costs to Australia of moving to establish a community which can increase regional prosperity," its report states.( by Mark Forbes)

From http://www.theage.com.au/ 08/13/2003

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PM Pushes Joint Pacific Police Force

The creation of a rapid-reaction force drawn from police around the region has been canvassed by the Prime Minister John Howard at the Pacific Islands Forum. Papua New Guinea's Prime Minister, Sir Michael Somare, said yesterday the option of the standing force, which would undertake surveillance and respond quickly to crises, had been discussed in talks with Mr Howard. The push to create such a force came as Mr Howard failed to convince Pacific nations to appoint veteran Australian diplomat Greg Urwin as secretary-general of the forum. The matter remained unresolved after intense lobbying at yesterday's Forum leaders' retreat. Further discussions will take place today and Australian officials remained hopeful that they might get the man they want to drive through a package of reforms for the region. Pacific leaders, however, did agree to one of Mr Howard's proposals for a greater pooling of resources a $17 million, five-year program to train 900 regional police each year in Suva. Sir Michael, who met Mr Howard on Thursday, made it clear this could be a step towards a more radical policing structure for the region. He said the talks "covered a lot of areas like a rapid force in the region for surveillance purposes and also if anything happens in any one of our smaller states in an emergency". Sir Michael stressed it was early days yet, but that Papua New Guinea, in consultation with other Melanesian nations, would prepare a paper on the proposal for consideration early next year. It would be "a broader force with Australian, New Zealand and Samoan support". Sir Michael, speaking before yesterday's inconclusive leaders' retreat, said: "There is a little bit of resentment about Australia's pushing [for reform]." Mr Howard wants Pacific nations - many of them with tiny populations and little wealth - to pool their resources, and has vowed to tie future aid to benchmarks that improve governance and stamp out corruption. "The unanimous feeling is that a Pacific islander should be in the position [of secretary-general]," Sir Michael said. "We may have to review the whole secretariat." There was agreement on the need for a review. Mr Howard said an eminent persons group would assess the secretariat and suggest reforms. Mr Howard told the meeting of leaders he would be concerned if an Australian could never lead it. He described the summit as a "watershed" for the Pacific. "I've come to this conference as a very engaged prime minister in the affairs of the Pacific," he said. "We are seriously engaged. That means we want to help, we want to achieve reform, we want to achieve change." He rejected concerns that some of these reforms might unreasonably impinge on the sovereignty of the smaller Pacific nations. "It's not an attempt to rob countries of their sovereignty. It's an attempt to invigorate their sovereignty through pooled arrangements, giving them capacity they wouldn't have on their own." The Forum agreed to begin a study on the merits of the pooling of resources to create a single regional airline and the prospects for greater co-operation in shipping. (by Tom Allard)

From http://www.smh.com.au/ 08/16/2003

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Howard Shifts Focus to Asia

Prime Minister John Howard will shift his focus from the Pacific to Asia as he heads to China for a meeting with the new Chinese leadership. After a successful three-day summit with Pacific leaders, Mr Howard left Auckland for a whistle-stop visit to China, where North Korea and trade will top the agenda. The visit is Mr Howard's fourth to China and will give him his first opportunity to meet the new Chinese leadership of President Hu Jintao and Premier Wen Jiabao, who were elected in March. Mr Howard wants China to play a constructive role in resolving nuclear tensions on the Korean peninsula. China is seen as a crucial player in six-nation talks agreed to by North Korea over its nuclear weapons program. Mr Howard said North Korea remained an enormous threat to the security and stability of the region. But he said the six nation talks were a huge step forward. "China has played a very constructive role and it is important from Australia's point of view that I talk directly to the Chinese leadership on this issue," Mr Howard said. "I would continue to urge upon the Chinese leadership that it keep going down that path. "If (North Korea) goes ahead to acquire a nuclear capacity then it is very important that all the diplomatic efforts of countries in the region and elsewhere be brought to bear to stop that happening." Mr Howard will also work to strengthen economic ties with Australia's third biggest trading partner, with an economic framework agreement between the two nations up for discussion. Australia is also considering a study to examine the costs and benefits of a free trade agreement with China as a precursor to the start of any formal negotiations. Mr Howard returns to Australia on Tuesday.

From http://www.smh.com.au/ 08/17/2003

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PM to Lay Down Law on Solomons Corruption

The Prime Minister, John Howard, is due to arrive here this morning to meet Australian troops and deliver a tough message to the Solomon Islands Government that it should back reforms and eliminate corruption. It is understood that the Prime Minister of the Solomon Islands, Sir Allan Kemakeza, who has been enmeshed in allegations of financial impropriety, will deliver a pledge to stamp out his nation's pervasive corruption. Mr Howard is visiting in the wake of the month-long Australian-led military intervention in the country. His arrival follows a gun amnesty during which most ethnic militias and criminal groups surrendered their arms. Military commander Lieutenant-Colonel John Frewen said he would urge Mr Howard to use the Solomons mission as a model for future interventions in the region. "There are encouraging signs that this is a good way to respond to this sort of situation in the future," he said. Mr Howard is scheduled to hold meetings with the Solomon Islands cabinet, at which Sir Allan is expected to thank him for the intervention team's work, but warn that rebuilding law and order and seizing remaining weapons will be difficult. Yesterday more than 5000 Solomon Islanders turned out for a display of Australian military capability and a sports carnival with the intervention force. Military hardware was on show, with Sea King and Iroquois helicopters staging a flypast over a soccer game between locals and the mission's team. Aside from generating goodwill, the event was also designed to convince locals that any attempts to retain weapons would be met with overwhelming force. Anna, 25, a member of the national netball squad, said it was exciting to play sport again. Local competitions had stopped because of the collapse of law and order. "You could not walk from practice because you were scared you would be robbed or raped," she said. Colonel Frewen said he was overwhelmed by the positive reaction of the islanders yesterday. (by Mark Forbes)

From http://www.smh.com.au/ 08/25/2003

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FIJI: New Constitution on the Way: Kaitani

FIJI is likely to have a new constitution by the end of the year. Government spokesman Simione Kaitani confirmed yesterday that with the Fiji Labour Party now almost part of the Multi-Party cabinet no time would be wasted over getting a new constitution. Not wanting to elaborate on the changes saying it was confidential and a matter to be kept within cabinet, Mr Kaitani said the changes would mostly circumvent the Agricultural Landlords and Tenants Act (ALTA) and the Multi-Party issue as they were "pressing". Another Cabinet source last night said the other major change would be the name change of Fiji Islanders and Indo-Fijians to indigenous Fijians and Indians. Mr Kaitani said the changes were needed as the 1997 Constitution had cost taxpayers a lot of money as it was not clear and confusing on issues. "Government intends to pursue other substantive amendments to the Constitution later," he said. Meanwhile, Fiji Labour Party leader Mahendra Chaudhry has called the issue a 'red herring'. Mr Chaudhry said, "There will be no new constitution and we are discussing ALTA with the Native Land Trust Board and will deal with it and as it comes .... I really don't want to comment on anything right now," he said. Meetings between the ruling SDL Party and the FLP are referred to as the Talanoa talks, Mediator Dr Sitiveni Halapua had over the weekend confirmed that a progressive report into the changes was almost complete and both leaders were at liberty to discuss it. Opposition Leader Mick Beddoes said he thought the Talanoa subcommittee talks were a show of arrogance by the two leaders, as any changes to the Constitution should have included the minorities as well. "We have a right to be heard and this is even mentioned in the UN Charters and we being left out is denying our constitutional rights as there are eight communities being left out," he said. -The Daily Post/PINA Nius

From http://www.pacificislands.cc/ 07/31/2003

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NEW ZEALAND: Government Plans Seabed Law by End of Year

The Government wants to introduce foreshore and seabed legislation by the end of the year, a plan set to inflame iwi. National says the legislation should have been introduced "yesterday". Leader Bill English said the longer the issue dragged on, becoming a political nightmare for the Government, the greater the uncertainty in the public mind. Fisheries Minister Pete Hodgson mentioned the timeline at the Waitangi Fisheries Commission's annual hui in Wellington yesterday and later spelled it out to media. Many iwi representatives missed Mr Hodgson's reference, included in a speech, but will be angered by it. They are already concerned the Government will present them with a fait accompli, engaging in a Clayton's negotiation process after it announces its proposals. Attempts to draw the Government into negotiations with iwi before it reveals those proposals have failed, with Associate Maori Affairs Minister John Tamihere saying they would be released next week. Te Tau Ihu spokesman John Mitchell said: "It's clear they have drawn up a substantive paper but don't want to release it." But Mr Hodgson said the Government still had to get some things "sorted out in our minds". It was also getting mixed messages from iwi. "I think Maori are wanting on the one hand us to do things nice and quietly and carefully and on the other to give them some certainty." While Te Tau Ihu wanted the release delayed, it was initially heartened by the Government's guarantee yesterday that it would "consult fully" iwi, Dr Mitchell said. But told the Government wanted to legislate by Christmas, an annoyed Dr Mitchell said: "There's not a show in hell of getting it introduced by the end of the year if it wants to consult properly." Te Tau Ihu and the commission have set up a working group in a bid to develop a common iwi position. But fractures between iwi were emerging yesterday, with some determined to negotiate with the Government independently. Others are angered by the commission's involvement. It is offside with some iwi because of its handling of the allocation issue, while others fear it is in the Government's pocket. Hauraki, which ran the Paeroa hui, and Te Tau Ihu are articulating different positions. Commissioner Maui Solomon and others warned yesterday that success could be achieved only if iwi unified. There was a marked shift in emphasis at yesterday's hui, away from the talk of ownership and title that dominated the Paeroa hui and towards talk of rights. Working group chairman Matiu Rei said as the Government was acting with "indecent haste" iwi had to move fast. Hauraki spokesman John McEnteer said any Government attempt to award a guardianship or "kaitiaki" title to iwi would be considered a whitewash. Mr English said the Government's initially firm stance had indicated it had legislation ready to go, but now it appeared to be dithering. It was delaying an announcement because it was "scared witless". Meanwhile, Associate Courts Minister Margaret Wilson said yesterday 16 foreshore and seabed applications had been lodged in the Maori Land Court since June 19. (by Ruth Berry)

From http://www.nzherald.co.nz/ 07/31/2003

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Right-to-Die Law Lost in Narrow Vote

Politicians have rejected a proposed new law which would have given people with terminal or incurable illnesses the right to die. The Death With Dignity Bill failed to cross its first hurdle in Parliament last night, when it was defeated at the first reading by 60 votes to 57 in a conscience vote for MPs. One MP abstained and two did not vote. The bill would have allowed the seriously ill to ask a doctor to help them die. But even if it had been eventually passed by Parliament, voluntary euthanasia would not have become law until it was supported by a majority of New Zealand voters in a referendum. New Zealand First MP Peter Brown, the architect of the bill, said last night that he was shattered. "The politicians have let the people of New Zealand down. I'm pretty brassed off." MPs eight years ago also defeated plans for voluntary euthanasia, and it is expected to be years before another attempt is made to legalise it. Mr Brown cannot put forward another bill at least until after the next election. He said last night that MPs should have been trying to help those who were suffering, and by voting not to let the bill be scrutinised by the public at a select committee had been hugely disappointing. "I think it's reprehensible they just dismissed it, and said 'well go away and do whatever you like, suffer in silence'." He had earlier spoken in Parliament during an emotional debate on the proposal, watched by his second wife, Lynley, and "right to die" campaigner Lesley Martin, who faces criminal charges over the death of her terminally ill mother. A visibly stressed Mr Brown told the Herald before the debate that he supported a law change partly because he had watched his first wife, Vera, die from cancer. "She was as fit as a fiddle, I'd never known her sick. "By the end she really pleaded with me, not for me to kill her, but she really pleaded with me that she's got to go. "She left two teenagers, one barely a teenager. You never forget that ... you never get over it." He had also been asked by a Christchurch tetraplegic to change the laws, but had written back saying it was against his Christian beliefs. "I felt awful, I felt guilty and I felt I was not doing the job that I was meant to do." In Parliament last night he asked Christians to support the bill reaching the select committee for scrutiny. "Don't let your faith blind your compassion," he said. National party leader Bill English had spoken strongly against legalising voluntary euthanasia. He said it cheapened the sanctity of life, and the bill was about providing comfort for the healthy not the sick. "This bill is a comfort for the living, not a ticket for those who want to die," he said. "This is always how the argument arises, it's 'I' feel the stress, that 'I' want death with dignity, because it gives 'me' discomfort to watch the pain. Well pain is part of life and watching it is part of our humanity, and many of us have become more human for having watched it, whether we liked it or not." Act MP Rodney Hide said people should be given the right to end suffering if they wanted. Former GP Lynda Scott, National health spokeswoman, said she had seen many patients die, sometimes slowly, and had seen elderly people talk about dying because they worried they were a burden. It was going too far to give doctors the opportunity to help a person die. "When you are saying it is ethical for a doctor to take a life, you are crossing a line." (by Helen Tunnah)

From http://www.nzherald.co.nz/ 07/31/2003

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Clark Rules Out Private Ownership of Beaches

Prime Minister Helen Clark says Maori are not going to get private ownership of the beaches, and neither is anyone else. The Government is preparing to announce legislation to resolve the foreshore and seabed controversy, and is trying to balance Maori rights against the need to safeguard public access. Maori customary rights and claims for customary title are involved. Miss Clark said today she did not have a problem with customary rights. "It's not about fish and shellfish. Customary rights to that are in place now," she said on Newstalk ZB. "My problem is with exclusive private ownership. No one is going to get any new exclusive ownership to the foreshore and seabed." Miss Clark's comments were the strongest indication so far of the Government's intentions. She said last week Maori would still be allowed to take customary title claims to court, but it is now clear there will be a barrier to prevent private ownership. The controversy began in June when the Court of Appeal ruled that Te Tau Ihu iwi could take a customary title claim to the Marlborough Sounds to the Maori Land Court. That raised fears that customary title could turn into exclusive title, meaning the right to sell the beaches or prevent public access. At the weekend, New Zealand First leader Winston Peters warned the Government against presenting any solution that was based on racial preferment. Describing the Treaty of Waitangi as an "outdated colonising document" he said it should not be used to take away the rights of any New Zealanders. "We take our rights of access to the sea for granted," he said. "Woe betide any government that tries to take these rights away from us...there will be a revolution, it will happen at the ballot box." Since the Government announced it was going to legislate to ensure public access to the beaches, all the political parties has set out their own policies. National has accused the Government of making secret deals and has put up billboards saying "the beaches belong to everyone". ACT has warned that any "appeasement" of Maori will lead to increased demands for private ownership. Mr Peters, in his weekend speech, said National was trying to set one group of New Zealanders against another. "Their inbred instincts to profit at the expense of the national's interest have prevailed," he said. Yesterday Te Ope Mana a Tai, a group representing eight South Island iwi, said customary rights had to have priority over all other coastal users. It laid out a set of principles designed to unite Maori before a second national hui is held in Blenheim later this month to discuss the issue.

From http://www.stuff.co.nz/ 08/11/2003

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Job Law Backlash Expected

The Government is bracing for a business backlash as it prepares worker-friendly changes to employment law, including a requirement for employers to maintain pay and conditions or pay redundancy when a business changes hands. A deal increasing the statutory minimum holidays to four weeks is also close, but will take effect after the 2005 election. Sources said amendments to employment relations law had been agreed, and would include a so-called "transfer of undertakings" provision. Unions have campaigned for a change aimed at employers using lower wages and conditions to gain a competitive edge, such as when a new firm wins a cleaning contract but employs the same staff. Opponents say such a clause would introduce rigidities, stop new firms achieving efficiencies and could trigger a business backlash similar to the 2000 "winter of discontent" when the Labour-Alliance government's popularity plummeted. Business NZ executive director Anne Knowles said she was aware the clause was high on the Government's agenda but she had not been consulted about it since February. "It certainly hasn't been my agenda that has any input into what's been going on. It would be absolutely anathema to businesses to have any restriction on their ability to contract out work or sell their businesses." The 2000 provision contributed to a slump in business confidence before it was shelved, she said. It is understood Small Business Minister Paul Swain, his associate John Tamihere and Economic Development Minister Jim Anderton questioned the timing and practicality of the clause. Mr Anderton's former Alliance colleague Laila Harre was a leading supporter of the measure under the previous government. Negotiations are well advanced also on a plan to increase the statutory holiday provision from three weeks to four weeks a year. It is likely to be passed into law this term but take effect after the election, making it a key campaigning tool for Labour and its allies. A bill in the name of Progressive MP Matt Robson is being considered by a select committee in tandem with the Government's revamp of the Holidays Act. The date for the committee to report the bills back to Parliament has been extended till till December. The new transfer of undertakings provision is not expected to revive the contentious clause 66 in the Employment Relations Bill, which was shelved after opposition from business. Sources said it could follow some of the provisions adopted by the European Union. The EU laws had sparked a lot of litigation, Ms Knowles said, and she did not expect New Zealand to adopt it. Other changes here would likely be "technical" and include strengthened good faith bargaining provisions. They would be aimed at discouraging "freeloading" - employers granting non-union employees the same deal as a collective agreement. Measures are also likely to encourage collective bargaining. Council of Trade Unions president Ross Wilson said the law had not reversed the decline in the coverage of collective agreements. Unions want to prohibit "bad-faith ideological stands" against collective bargaining, to oblige employers to commit to talks and to a settlement. (by Vernon Small)

From http://www.stuff.co.nz/ 08/18/2003

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Govt Sets Limits for Tertiary Education Fees

Average tertiary education fees should increase by no more than the rate of inflation for the next three years, Tertiary Education Minister Steve Maharey has said. The Government today announced the final fee setting system for universities and polytechs after releasing indicative figure in the budget earlier this year. The fee maxima system caps the fees students can be charged by tertiary institutions depending on what they are studying. Fees for arts courses will be a maximum of $3900 in 2004, sciences $4500, engineering $5200, medicine $10,000 and law $4200. Mr Maharey's spokesman said these represented a level of increases at about the rate of inflation with a few exceptions. Tertiary institutions that currently charged below the maximum level would be allowed to increase those fees by up to five percent a year until they reached the maximum. Institutions that currently charge fees above the maximum will have them frozen. Postgraduate fees are exempt from the maximum levels, but they will not be allowed to increase by more than $500 a year. "The Government anticipates that tertiary providers will keep any fee increases to around the rate of inflation next year. We have provided a 3 per cent increase in tuition subsidies for 2004 - this is 1.2 per cent above inflation estimates," Mr Maharey said. The universities vice-chancellors' committee reacted angrily to the decisions. In particular they took exception to the cap being placed on fee increases for universities with fee levels below the maximum. "The fee maxima policy gave institutions some flexibility in setting tuition fees next year," the committee's executive director Lindsay Taiaroa said. "Universities would have used that flexibility responsibly to address existing fee anomalies when they set fee structures for 2004. "Now Government has simply abandoned its own policy and left the entire tertiary education sector high and dry." Mr Taiaroa said the freeze on fees in recent years had now become a squeeze for political reasons and educational standards would be difficult to preserve. There would also be problems in the future due to the Government's decision to adjust fees in line with the Consumer Price Index. "This is clearly unsuited for the purpose given that over the past five year the CPI has risen by just 9.9 per cent, while earnings have risen by 19.4 per cent. Staff costs are definitely the major item for universities as they struggle to attract, retain and reward their staff," he said. Labour's partner in government, the Progressive Coalition, objected to any fee increases and said money should be found to achieve that. However, Party leader Jim Anderton said he was "proud" to be part of the decision that stopped low charging tertiary institutions lifting fees to the maximum allowable. The vice-chancellors disagreed and said they would be appealing to the Government for a more "appropriate escalator for fee maxima". "If Government will commit to that course their tertiary education strategy may yet be achievable," Mr Taiaroa said.

From http://www.stuff.co.nz/ 08/21/2003

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PNG: Death Penalty Considered

FORMER PNG Defence Force Major Alois Erebebe and co-accused Teros Togote, both found guilty of the willful murder of nine people almost four years ago, yesterday pleaded for mercy as prosecutors asked the court to sentence them to death for their crime. Erebebe and Togote were convicted by the National Court for killing of the nine people near Goroka town in November 21, 1999. The nine included National Housing Corporation employee Jerry Malomamo, his father and three children. Mrs Malomamo and six other escaped death in the massacre and became key witnesses in the murder trial. Senior State Prosecutor Joseph Kessan yesterday asked the court to impose the death penalty in accordance with section 209 of the Criminal Code because the case involved the killing of innocent people of various ages who did not deserve to die. Mr Kessan said they were killed in a carefully planned ambush designed to achieve the maximum result with the use of guns and bush knives. "The medical reports of each deceased tendered in evidence speak for themselves. The children especially were mutilated with bush knives; they were chopped more than once in the head. Most of the adults were shot with high-powered guns. "This was a cold-blooded, willful murder of nine people, cowardly executed purely for reasons of payback. Willful murder in ambush situations and tribal settings is a prevalent offence which the community is no doubt demanding immediate action from the courts," Mr Kessan said in his submission. He said there was no special mitigating circumstance favourable to the prisoners and that this was a contested case whereby the prisoners were no longer entitled to reduce sentences. The defence, on the other hand, called for a lesser penalty as it was no secret that the killings occurred as a result of a long standing tribal dispute, which also led to the killing of Erebebe's father in 1997. Defence Lawyer Derryl Sakumai said tribal fighting and payback killings in circumstances such as these did not warrant the death penalty. Sakumai said the case must be viewed as a payback killing in a tribal setting, adding that the prosecution has not shown beyond doubt that the accused pulled the trigger. He submitted that a concurrent jail term of 10 - 15 years would be appropriate. In his plea for mercy, Mr Erebebe asked the court to consider that he was 43, is married with five children, and that he had served the PNG Defence Force with distinction and loyalty for over 25 years. He said he had contributed to be active in sport by playing rugby league for 10 years, and that "deep in my heart, I know I am innocent". Mr Togote also pleaded for leniency, saying he had three wives and five children, and a coffee business that has fallen into ruin since he was in custody. He said his wives have since deserted him, and his old mother was struggling to look after his children. Presiding Judge Justice Elenas Batari said willful murder was a very serious offence: "The law says I must consider the death penalty which is the call of the people as submitted by the State Prosecutor," he said. Justice Batari said he would hand down a decision on their punishment on August 19. - The National/PINA Nius

From http://www.pacificislands.cc/ 07/31/2003

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Top Parliamentarians of 37 Nations Set Meet in Manila

Wider international cooperation for peace, economic and social reforms will top the agenda when top parliamentarians from 37 nations meet at the 4th General Assembly of the Association of Asian Parliaments for Peace to be hosted by the Philippines at the Manila Hotel on Aug. 31-Sept. 5. Speaker Jose de Venecia, incoming president of the organization, confirmed that Chairman Wu Bangguo of the standing committee of China's National People's Congress, will lead a cast of eminent policy makers and statesmen from the national parliaments of most of the 37 AAPP member-countries invited to attend the conference. De Venecia, one of Asia's most prominent parliamentary leaders, is set to take over the presidency of the AAPP during the conference. Chairman Wu Bangguo will turn over the AAPP presidency to De Venecia who was elected unanimously for the post at the association's third general assembly in Chongqing, China. The Speaker said the policy makers from Northeast Asia, Southeast Asia, South Asia, Central Asia and West Asia have confirmed participation in the Manila conclave whose main theme is "Toward a Hundred Years of Peace in Asia." Previous meetings of AAPP were held in Bangladesh where it was founded by 28 countries, Cambodia and China. De Venecia said parliamentary leaders will meet in Manila to push for wide-ranging reforms as a way of ushering in "enduring and lasting peace in Asia and throughout the world." "We must not lose the momentum that we have gained since the founding days in Bangladesh and the subsequent period of growth," he said. The conference was held last in Beijing, where De Venecia was honored with dinner at the Great Hall of the People by then Chairman Li Peng of the standing committee of the National People's Congress and Manila chosen as host upon the Speaker's election to vice president. In the Chongqing Declaration, the AAP reiterated the association's "strong opposition to terrorism in all its forms and manifestations." De Venecia, whose proposal led to the tri-nation anti-terrorist alliance among the Philippines, Indonesia and Malaysia after the September 2001 terrorist attack in the United States, has proposed to expand this pact with a cooperation agreement between ASEAN and the so-called Shanghai Six organizations led by China and Russia to further contain the spread of terrorism. As of last Aug. 16, countries that have confirmed participation in the Manila Hotel conference are Bangladesh, Bhutan, China, Cyprus, Indonesia, South Korea, Kuwait, Laos, Malaysia, Mongolia, Nepal, the Russian Federation, Saudi Arabia, Tajikistan, Thailand, Singapore and Vietnam. Several non-member countries are also sending their delegations as observers. These are Japan, Kazakstan, and Papua New Guinea. The AAPP was founded in Bangladesh by 28 countries but the members registry has since increased to 37 nations. (by Ben R. Rosario)

From http://www.mb.com.ph/ 08/17/2003

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Asia's School Systems Need to Adjust to New Global Economy, Says ADB's Key Indicators

BANGKOK, THAILAND - Rapidly changing conditions in the world economy require more flexible, easily trainable labor forces that are better able to access and interpret the mass of available information. This, in turn, requires higher-quality, more adaptable education systems that can provide young people and adults with the knowledge and skills to function effectively in the new global environment. This is one of the core messages of the Asian Development Bank's (ADB) Key Indicators (KI) 2003, which was launched here today. KI, ADB's annual statistical databook on economic, financial, and other social indicators, includes a special chapter that analyzes education trends in the region. The new global economy includes the following trends¡­ In this new global environment, the nature of jobs is also changing dramatically. As a result of globalized competition, and greater emphasis on cutting costs and raising productivity, employers are reorganizing work around decentralized management, customized products, and more specialized tasks. With much work narrowed down to specific tasks, there will be more subcontracting, self-employment, part-time work, notes KI. "Workers are being defined less by the long-term job that they hold than by the knowledge that they acquire through study and work. Their 'knowledge portfolio' allows them to move across various types of work. Most individuals, including production workers, will become increasingly conscious of knowledge acquisition," according to KI. "This change has important implications for education, as a job market characterized by constant changes places more value on flexible, knowledge-based skills, particularly if acquired through on-the-job training and recurrent education. Science-oriented education and problem solving skills will have the highest return," says KI. "One important expression of this premium on knowledge has been the increase of the economic value of higher education compared to the value of lower levels of schooling. "Several Asian economies-especially those in East Asia-have flourished in this new environment, mainly because they have been able to coordinate the rapid expansion of education with the equally rapid transformation of their economies into manufactured goods exporters. But at the other end of the spectrum, some economies are still struggling to meet the basic education needs of their growing and largely poor and rural populations." KI warns, "In the latter group of countries, improving and expanding education systems to address the somewhat conflicting two goals of education, namely, increased competitiveness and equity, is a major challenge under the severe financial and fiscal constraints they face." KI evaluates the progress and pressing needs of the education systems in individual developing Asian countries.

Excerpted from http://www.adb.org 08/19/2003

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APEC Leaders to Promote Reform, Jobs at Oct. Meet

Leaders of the Asia-Pacific Economic Cooperation forum will pledge improved cooperation in the areas of business revitalization, corporate governance, regulatory reform and job creation in an action plan to be announced when they meet in October in Thailand, government sources said Wednesday. The plan is designed for the 21 member economies, including Hong Kong and Taiwan, to achieve sustainable economic growth through structural reforms and will be included in the summit declaration. The APEC leaders will vow to improve their nations' social infrastructure, laws and systems to help write off corporate debts as an essential means of revitalizing financially troubled firms. To improve corporate governance, the leaders are expected to announce their governments will work to upgrade their respective corporate accounting systems with the aim of ensuring transparent business activity.

From http://www.yomiuri.co.jp/ 08/21/2003

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CHINA: Anti-piracy Officials Enjoy More Authority

As of September 1, copyright administration officials will be able to take drastic measures in their actions against piracy to prevent policy violators from disposing of evidence. The new regulation is part of a recent amendment to rules on how to implement administrative penalties on copyright infringement, and is aimed at better safeguarding the rights of copyright owners. Under the current rules, when finding people selling or producing pirated audiovisual products, anti-piracy officials cannot keep the pirated products or materials used for production as evidence before the case is placed on file. As a result, when officials return another day with the case placed on file, the infringers have already hidden or destroyed the crucial evidence. In 2000, after several days' worth of investigations, officials verified that a printing house in Wuhan, capital of Central China's Hubei Province, was printing pirated Cihai - an encyclopedic dictionary of the Chinese language - without authorization. But when they went to the facilities in question to gather evidence, staff at the plant had heard of their moves earlier and transferred all of the pirated dictionaries elsewhere in advance. According to the newly amended rules, officials do not need to wait for the case to be placed on file to register and preserve relevant evidence at the scene. This means that in the above case, the officials can go directly to the factory for evidence as soon as there is sufficient cause. "The amendment gives administrative officials a stronger hand in law enforcement and improves efficiency," said Wang Ziqiang, an official with the National Copyright Administration. The revised rules also stipulate procedures that administrative law enforcement officials should follow in dealing with cases and procedures of storing evidence. Each year, the country's copyright administrations assign large numbers of personnel to crack down on piracy. The administrative law enforcement officials can decide on either applying administrative penalties on violators or referring cases of gross violation to relevant judicial bodies.

From China Daily 07/31/2003

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Reforms Made on Local Administrative Approving System

Shanghai will cancel or regulate 243 items of projects needed for administrative approval, the third batch involving in the reform, with 51.5 percent of the total 2,207 items covered in the reform to date, according to the Shanghai Municipal Government's press conference yesterday.Among the 243 items, 101 ones needn't be examined or approved any longer, and the remaining 142 will be examined and approved in a newly-adopted way. The city will make reforms in administrative approving system on a trial basis in Pudong, Changning and Minhang districts this year.The trial reforms in administrative approving system will be keen on the Pudong New Area this year in order to improve the efficiency of the system in the area, according to the press conference. The city-level authority will transfer its examining and approving rights to district-level departments in Changning District. Reforms in social affairs approving system will be made in Minhang District this year.The city will also standardize the charging of administrative approving, with annual inspection work enhanced, according to the press conference.

From http://www.shanghai.gov.cn/ 07/31/2003

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Democracy Grows with Rural Autonomy

The success of the villagers' autonomy programme over the past 15 years has provided valuable experience for China's introduction of further democratic reforms. In late 1987, the National People's Congress (NPC) passed a trial code on rural governance, which authorized direct voting in the election of autonomous rural villagers' committees. With other national and local governance institutions still voted in by representatives, the introduction of direct voting for the country's over 900 million rural people -- the first time in China's history -- was a great democratic achievement. The autonomy scheme was so successful that the NPC finally replaced the trial code with the finalized Organic Law of Villagers' Committees in 1998. The success of village elections has undercut scepticism of the prospects of democracy in rural areas, where the economy is backward and education is poor. Chinese farmers have shown great enthusiasm in assuming their political rights, with an average turnout of above 90 per cent in villagers' committee elections. Many villages have innovated very good practices in the democratic management of public affairs. Some had worried that the lingering patriarchal clan tradition in rural areas could undermine the justice of villagers' autonomy. However, investigations show most villagers are rational in casting their votes. To most rural residents, selecting committee members who can lead them toward a better future is far more important than the interests of the patriarchal clans to which they belong. They have begun scrapping the irrational patriarchal clan complex and participating in the build-up of democracy in a pragmatic way. Their actions prove that the democratic system is a tremendous cohesive force which helps people make right choices about their communities. The pursuit of democracy is the common will of the people and there can be no logical excuses to obstruct it. Villagers' autonomy has undoubtedly affected the interests of some, because they can no longer appoint village heads or influence village affairs for selfish reasons. It also brings subtle changes in the relations between villages and the townships above them. Investigations reveal that most opponents of the direct vote in villages have vested interests. However, the unswerving line of the Communist Party of China, seen as the representative of the broad masses to forge ahead with times, to adhere to grassroots democracy, will endure. Still, there are many jobs to do to improve villagers' autonomy. It is necessary to consider how to reduce the costs entailed in villagers' autonomy. Nearly every link in the autonomy, such as elections, movements, organizations and meetings, needs money. The cost is quite a heavy burden to the villages. Aside from financial support from upper-level authorities, some aspects of villagers' autonomy may need to be reformed to make it more economical and efficient. For example, the term of villagers' committees can be extended from the current three years to five, a uniform term of office in township, municipal, provincial and national legislative and administrative organs. This will not only reduce the cost of frequent villagers' elections but make villagers' committees more far-sighted in decision-making. It is also important to prevent the tendency toward the irrational application of voting in every aspect of villagers' autonomy. Some villages, with a biased understanding of democracy, decide on every local affair, big or trivial, all through villager referendums. With such a practice village leaders can avoid taking personal responsibility for mistaken decisions. It results in extremely slow work and runs counter to legislators' original purpose to create efficient and responsible grassroots autonomous units. The democratic election of village leaders is only the first step. The work of villagers' committees needs to be standardized to promote rural economic and social progress. The committees should always be development-focused and make public affairs and financial information transparent. The great undertaking of villagers' autonomy will lay a solid foundation for the development of democracy in China.

From http://service.china.org.cn/ 08/02/2003

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Shanghai Government Agencies to Restructure

Shanghai, with the approval of the State Council, is preparing to restructure its government agencies to link up with the newly adjusted central government structure, according to a municipal working conference at the weekend. The restructuring of the Shanghai municipal government system will be the first scheme to reform any Chinese regional government since the latest round of adjustments of State Council organizations earlier this year. It will focus on macroeconomic control, market regulation, and the administration of social services, in accordance with Shanghai's status as a large metropolis, said sources at the conference. Under the scheme, Shanghai will establish the Shanghai State-owned Assets Supervision and Administration Commission. The commission will be directly under the municipal government and will be responsible for better managing the city's massive amount of State property. Strengthening the management of State assets is "the most important task" in the new round of municipal government restructuring, Party Secretary Chen Liangyu of Shanghai told the conference. The Shanghai Development Planning Commission, a key department in charge of macroeconomic planning, will merge with the Shanghai Economic Mechanism Reform Office to become the Shanghai Development and Reform Commission, in an effort to improve the system of macroeconomic control. Similarly, Shanghai will set up a new Shanghai Economic Commission by merging the original Shanghai Commercial Commission and Shanghai Economic Commission. Unlike the new State Council structure, Shanghai will maintain its foreign-trade and investment watchdogs - the Shanghai Municipal Foreign Trade and Economic Co-operation Commission and the Shanghai Municipal Foreign Investment Commission - to accord with the city's status as a national center for international economic exchanges. On the basis of the original Shanghai Drug Administration Bureau, a new Shanghai Food and Drug Administration Bureau will be set up in accordance with the State Council's new operation. In addition, the city's government will upgrade the administrative level of its workplace safety supervision office and its information technology office to enhance the government's involvement in those two areas. Under the new scheme, the Shanghai municipal government will have 45 departments, last weekend's conference heard. Shanghai Mayor Han Zheng told the conference that the reform, which is regarded as the municipal government's key task for the remainder of this year, will hopefully further simplify the municipal government structure and make it more efficient and transparent in line with international practices in public administration. In addition, the restructuring of the municipal government aims to further reduce overlapping among its sub-departments, while strengthening administrative collaboration between different government bodies, according to Han. Party Secretary Chen said local Party organizations will also undergo adjustment along with the government restructuring.

From China Daily 08/04/2003

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HK Gets New Principal Government Officials

Chief Executive of the Hong Kong Special Administrative Region (HKSAR) Tung Chee-hwa announced on Monday the appointment of four principal government officials. Tung announced at a news conference that according to relevant provisions of the Basic Law of the HKSAR and his nominations and suggestions, the State Council, or the central government, has appointed Tang Ying-yen as financial secretary of the SAR government, Lee Siu-kwong as secretary for security, Tsang Chun-wah as secretary for commerce, industry and technology, and Wong Hung-chiu as commissioner of the Independent Commission Against Corruption (ICAC). "I think the public know every one of them well. They all have excellent leadership skills and a wealth of experience," Tung said. Tang Ying-yen came from the business sector. Before joining the government, Tang served in various public service posts. The chief executive said that after working in the government for more than a year, Tang has gained a good grasp of its structure and operation. "Tang is also very familiar with the operation of the market. He is the best choice for the financial secretary's post," Tung added. The other three officials have been serving the government for years and have in-depth understanding of the government and how the policy process works, said Tung, adding that he is confident that "they will do an excellent job." "I am also confident that the financial secretary and the three other principal officials will help us move towards a more open, progressive and efficient government, to work for the interests of the people of Hong Kong and do their utmost to serve the public," Tung said. "I hope they can count on the support of the community as we work together for the development of Hong Kong," said Tung.Tang Ying-yen -- Newly-appointed HK Financial Secretary Tang Ying-yen was appointed on Saturday as financial secretary of the Hong Kong Special Administrative Region (HKSAR) government by the State Council, or the central government of China. Tang had served as Secretary for Commerce, Industry and Technology of the Government of the Hong Kong Special Administrative Region since July 2002 to deal with policies in relation to information technology, telecommunications, broadcasting, film services, innovation and technology, external commercial relations, industry and business support, intellectual property protection and inward investment promotion. Tang has a long record of public service. He has been a member of the Executive Council since 1997. He served as a member of the Legislative Council for seven years from 1991 to 1998. Tang has also served extensively on various government boards and public bodies, including the Trade Development Council, Town Planning Board, University Grants Committee, Council of the City University of Hong Kong and Services Promotion Strategy Group in the Electronics and Textile industries. Before joining the government, Tang was a leading industrialist in Hong Kong. He received the Young Industrialist Awards of Hong Kong in 1989 and was selected as a Global Leader for Tomorrow by the World Economic Forum in 1993. He served as chairman of the Federation of Hong Kong Industries between 1995 and 2001. He was also a Committee Member of the Hong Kong General Chamber of Commerce and a Steward of the Hong Kong Jockey Club. In 2000, he received the Gold Bauhinia Star Award of the Hong Kong Special Administrative Region.

Tang was born in Hong Kong in 1952. He holds a Bachelor of Arts Degree from the University of Michigan. He is married with four children.

Lee Siu-Kwong -- Newly Appointed HKSAR Secretary for Security Lee Siu-Kwong, 54, became director of immigration of the first HKSAR government in October 1998 and was appointed as commissioner of the Independent Commission Against Corruption (ICAC) of the 2ndHKSAR government on June 2002 by the State Council, China's central government. Lee graduated with a bachelor of science degree from the University of Hong Kong. He also received professional training in Beijing-based Tsinghua (Qinghua) University, London-based Oxford University, and Harvard University of the United States. As the ICAC commissioner, Lee believed that Hong Kong should better crack down on corruption, improve law enforcement and prevention of crimes, and that the ICAC should strengthen ties with its Chinese mainland and international counterparts in its future work.

Tsang Chun-wah -- HK's New Secretary for Commerce, Industry and Technology Tsang Chun-wah, 52, joined the Hong Kong civil service in November 1982. From 1987 to 1991, he served as the administrative assistant to the financial secretary. He was assistant director-general of trade from 1991 to early 1995 and private secretary to the Hong Kong governor from 1995 to June 1997. Tsang became director-general of the London Economic and Trade Office from July 1997 to February 1999, commissioner of customs and excise from March 1999 to July 2001 and secretary for planning and lands from July 2001 to June 2002. He was appointed as permanent secretary for housing, planning and lands (planning and lands) on July 1, 2002.

Wong Hung-chiu -- HK's New Commissioner of Independent Commission Against Corruption Raymond Wong Hung-chiu, 46, joined the Hong Kong civil service in August 1980 and rose to his present rank of Administrative Officer Staff Grade A in July 2002. He had served in various bureaus and departments, including the Social Welfare Department, Home Affairs Branch, Health and Welfare Branch, the former City and New Territories Administration, the former Office of Unofficial Members of Executive and Legislative Councils, the former Legal Department and the former New Airport Projects Co-ordination Office. He was commissioner for narcotics in the Security Branch from January to December 1996, served as deputy director of the Handover Ceremony Co-ordination Office of the Chief Secretary's Office from January to July 1997 and was deputy secretary for security from August 1997 to July 2001. Wong was appointed to the position of commissioner of customs and excise in July 2001. As the commissioner of customs and excise, Wong committed himself to the fight against smuggling, piracy and other illegal activities. He attaches importance to strengthening cooperation with the customs on the Chinese mainland, and increasing the efficiency of passing customs to meet the demand of personnel exchange and logistics distribution between the two sides.

From Xinhua News Agency 08/05/2003

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Municipal Public Service Sector Opening Up

China is taking steps to speed up opening municipal service sector to domestic and overseas investors, said officials of the Ministry of Construction Wednesday. The Chinese Government plans to seek diversified resources for the country's projects of public services, according to the ministry. This would be another break-up of monopolies, involving water supply, gas supply, heating, sewage treatment, waste treatment, public transit, environmental protection, and environmental sanitation. Besides encouraging more overseas and domestic private investors to invest individually or in cooperation with local authorities or enterprises in the construction and operation of the municipal works, the ministry will also establish and improve franchising management regulations. The ministry will hold a series of activities, such as seminars, exhibitions and investment fairs, to promote the reform. The first move will take place from Sept. 24 to 26, when the first national investment fair for promoting marketization of municipal works will be held in Beijing and is expected to be attended by government official, scholars and experts, managers of municipal projects, international and domestic investment organizations and agents.. The ministry has also set up an infrastructure projects information database and a website for municipal projects investment. Statistics from the information database show that nearly one hundred billion yuan will be needed for the already registered infrastructure projects in China.

From Xinhua News Agency 08/07/2003

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Beijing Women Officials 'Hold Up Half the Sky'

In the past five years, 3,337 women officials were trained and 717 were recommended for official positions in Beijing. These figures show that Chinese women's ability of joining national and social management teams has been notably enhanced. To date, in municipal government departments, 16.7 percent of bureau rank cadres and 24.4 percent of department rank cadres are women. The proportion is the highest in the country. The 11th Women's Congress of Beijing will be held between August 9 and 11. Some 520 delegates, including 59 specially invited delegates and 21 non-voting delegates will attend the meeting. Over 90 percent of the attendants have achieved junior college education. Wu Xiuping, the vice chairwoman of the Beijing Women's Federation, said they had recommended a large group of women who were considered to have both ability and integrity to official positions. Most of them have made great achievements in their careers and are known for their diligence, honesty and contribution to public life. At present, the work of choosing women officials has developed into a beneficial circle system. According to statistics, 53 percent of technicians and almost half of employees in foreign companies are women. Most of them are undergraduates, graduates with some holding doctorates. They have received plenty of education and now achieve good incomes. Women have now equality in most work appointments and salaries in China. It is not an exaggeration that Beijing women 'hold up the half sky', the federation claimed, making reference to Chairman Mao's statement that women are the equal of men. The federation carries out training for laid-off women and has helped more than 50,000 women to be reemployed. (by Feng Yikun)

From http://www.China.org.cn 08/11/2003

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11 Senior Officers Fired in Push to Improve Police Image

Beijing public security authorities have fired 11 heads of police substations in their latest crusade against law enforcement irregularities, local media report. Head of the municipal Bureau of Public Security, Ma Zhenchuan, urged his colleagues to be friendly and fair to the public, observe limits to their powers, follow due procedure, and be self-disciplined in performing their duties. Calling for law enforcement officers to behave themselves and respect the law sounds paradoxical and superfluous. But it is not considering that Zhou Yongkang, Minister of Public Security, admonished police officers nationwide on July 31 to "resolutely stop malignant violations that offend the heavens and reason, and stir up public indignation." Zhou's remark was a considered one. Lack of respect for civil rights and abuse of mandatory measures have combined to create a negative image of police officers. Many people have personal experience of the typically stiff, long faces of police officers in this country. In the first six months of this year, 54 per cent of complaints Beijing's municipal public security bureau received were about attitude problems. Beijing police chief Ma blamed the problems at local police stations on officers' ignorance and neglect of their powers and duties. From a police officer's point of view, public security has traditionally meant control at any cost. This philosophy allows officers to violate individual rights with the excuse of maintaining social stability. The police force has earned a bad reputation for violations such as unwarranted searches, detention, confiscation of property, brutality and extortion. Calls to discipline the police force have intensified as the media become increasingly aggressive in raising legitimate concerns about law enforcement. Since Zhou Yongkang assumed the top public security job late last year, he has tried hard to create a new image for the country's populous yet unpopular police force. On January 22, the Ministry of Public Security published its "five prohibitions" aimed at illicit use of weapons, alcoholism and gambling among police officers, which are believed to be the main causes of police brutality and corruption. The latest endeavour to repair the tarnished image of the police was the ministry's publication on August 7 of changes to previous decrees governing residence registration, traffic, vehicle and border control. The 30 changes aim to simplify procedures. Despite comments that they were long overdue, the decisions did give the impression public security authorities are serious about their boss' vow to build a police force "for the people." Zhou called on the country's public security apparatus to launch "a profound revolution in the philosophy of law enforcement." He urged police officers to demonstrate through their own performance they are "executing the law for the people." At a July 31 meeting on rectifying police stations, Zhou again proposed to check the excesses of the police, refine law enforcement and improve the force's image. Zhou's resolve and efforts to recover public confidence in the country's public security authorities have drawn applause because it may defuse a major threat to all law-abiding citizens. As a positive reflection of the new central leadership's populist approach, a clean, just and law-abiding police force will provide a major boost to the public's sense of security. As long as civil rights are compromised in the pursuit of order, or sacrificed in the name of public safety, there is no guarantee State power will not be used to bully individuals. Both former President Jiang Zemin's proposal that the Communist Party represent the fundamental interests of the Chinese people and current President Hu Jintao's call for "power to be used for the people" stress the idea of curbing intrusive State power for the public good. Transformation of the police force is a crucial move in completing the new administration's people-friendly image. It is also an ideal starting point for cultivating constructive interaction between the public and government.

From http://www1.chinadaily.com.cn/ 08/13/2003

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New Committee Launched to Standardize Industry

The National Committee for the Standardization of Logistics Information Management was established on Aug.12 in Beijing to promote the development of China's modern logistics industry. Approved by the Standardization Administration of China (SAC), the committee is mainly responsible for formulating, revising and implementing standards in logistics information fields such as information groundwork, systems, security, management and information applications. "Information transmission is the core element in modern logistics industry, therefore, standardization is key to this newly-emerged industry's development,'' said SAC Director Li Zhonghai yesterday at the committee's establishment ceremony. However, data exchange and information sharing are difficult to achieve at present, since there have been no unified standards adopted. The isolated information databases of firms and institutions result in low efficiency and hinder the logistics sector's healthy and rapid development, Li said. He urged the new committee to map out an industry-wide standardization system as soon as possible.

From China Daily 08/13/2002

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An Open Road to Government Leadership

Among the newly promoted government officials last year, 59.8 percent, or 180,000, got their positions via a system of open competition, according to the Ministry of Personnel. Since 1998 when the system was introduced, about 353,000 people have stood out and moved ahead courtesy of the process. It is, no doubt, an inspiring message -- especially at a time when corruption still runs rampant. Under the system, government positions and requirements needed to fulfill them are made public, and applicants have to take part in examinations and undergo comprehensive evaluation by the public, their peers and organization departments. Recruitment in such a transparent way helps ensure that the top applicants are chosen and most importantly, it helps stamp out nepotism from officials in higher-echelons. The older system leads to many officials becoming the lap dogs of their superiors, instead of performing their duties for the public. It also explains why some corrupt officials are able to climb even higher. One of the latest examples is Wang Huaizhong. He climbed smoothly through the ranks from a small city to become the vice-governor of Anhui Province, thanks to his superiors before he was found having committed corruption and had a bad reputation among the local people in Fuyang, where he worked before the promotion. Without a democratic procedure and supervision, it is hard to guarantee the justice in official selection and promotion processes. Worse, when the right to decide who will move up is dominated by a few higher-ranking officials and when the whole procedure is carried out clandestinely, there might be temptation for people to buy their way up the ladder. Past experience shows the process of choosing and promoting government officials is vulnerable to corruption. Quite a number of cases have been exposed in which higher-level officials have taken bribes and wielded their influence in the process. The well-intentioned system, however, is far from being perfect and some central government departments have so far failed to introduce it. Also, it has not been taken on board uniformly among the provinces that have accepted it. But the Personnel Ministry is drafting a special document to make it an airtight procedure.

From China Daily 08/14/2003

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Judiciary and Legal Experts Meet to Discuss Curbing Corruption

The Chinese judiciary and legal experts have joined forces to crack down on official corruption and eliminate the "corruption culture". A seminar on prevention of corruption-related crimes was held by the Supreme People's Procuratorate Wednesday. Ma Haibin, deputy director of the Anti-bribery Bureau under the procuratorate, said such crimes were well entrenched, and serious indication of wide scale corruption. He said corruption generally showed four characteristics, including broader crime fields, more group crime, more diversified and intellectualized means, and a trend towards more international crime. The crime fields had expanded from party and government offices, the judiciary, financial departments and Customs to all levels of society, said Ma. Bribery had also appeared in the education system, and even the funeral industry, which had previously been free from corruption. The suspects always made numerous contacts at all levels of society, conspiring together, so that one case may be associated with many others in a web of crime linking dozens, or even hundreds of people. Mentioning the diversified and intellectualized means used by suspects, Ma said money laundering was a common way to deal with illegal earnings. The suspects also illegally exercise their functions and powers to accept the profitable opportunities in business, going abroad for travel or using cars and real estate as bribes. With China's entry into the World Trade Organization, the suspects used their international connections to conspire with foreign accomplices, said Ma. They transferred their illegal earnings and their families' fortunes abroad after committing crimes, he said. Statistics show that some 207,103 cases related to official bribery and malpractice, including 5,541 major cases, have been registered by procuratorates at different levels since 1998. And 12,830 middle and high-level cadres were prosecuted during the period.

From Xinhua News Agency 08/14/2003

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More Farmers Needed in Public Service

An examination-based recruitment system has helped ensure the competence of civil servants, but a more even representation is needed to increase the efficiency of their work. Early this week, the country observed the 10th anniversary of the introduction of a regulation that activated the civil service exam. A decade of implementation has contributed significantly to the establishment and improvement of the public service system. A total of 2.4 million people have sat for exams for public servant positions since 1994, with 700,000 being selected. Based on the principle of "transparency, fairness, competition and merit," the examination has decisively reshaped the system in line with the country's promotion of the rule of law and market-oriented reforms. Employment of a large number of people of a high calibre has enabled governments at all levels to serve society more effectively. And encouragingly, over 5,000 farmers have been added to the public payroll through the system over the past 10 years. This clearly illustrates the country's push toward an open society in which every member is equal. The number of farmers-turned civil servants may look impressive given the rigid separation between the urban and rural personnel systems that has existed for decades. But the tiny number of people in this group, less than one in every 100 public servants, contrasts sharply with the fact the rural people account for about two-thirds of China's population. Most of those who stand out in the civil service examinations, due largely to their educational backgrounds, are city dwellers. As part of the transparent system a decade on, there should be a clause enabling more farmers to enter the public service. It is an unspoken obligation for governments at all levels to serve both city dwellers and rural residents. So this lack of adequate representation for rural people means governments are not close enough to all sections of society. In view of the widening development gap between urban and rural areas, the national authorities have tried every means in recent years to aid disadvantaged farmers. Unfortunately, some local governments failed to carry out the pro-farmer policies earnestly. And sometimes, there are even reports of abuses of power by local public servants against rural people. One of the underlying reasons behind the misdeeds is the absence of due representation of rural people in the public service. The gap between local officials' concerns and farmers' interests is where a hotbed of government faults lie. It is not that qualified civil servants from urban areas cannot grasp the reality of rural China, but the personal experience of farmers - their difficulties - will naturally render them more sensitive and attentive to farmers' needs. With more farmers securing civil service positions, governments at various levels will be able to deliver rural policies swiftly and in line with farmers' actual conditions.

From China Daily 08/16/2003

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Public Bidding to Purchase Medical Equipment

The Ministry of Health has allocated 834 million yuan (US$101 million) for the purchase of medical equipment through public bidding next month, sources with the ministry said. Funding is in place to purchase the equipment for 13 projects directly organized by the Ministry of Health, said Zhao Zilin, the ministry's deputy director of planning and finance. An expert group organized by the ministry will look for bidders at the 12th China International Medical Equipment and Facilities Exposition and Symposia, scheduled for September 10-12 in Beijing. Following a selection process, bidding will commence in mid-September and finish by the end of the year. The 13 projects to be funded include basic rural medical construction in the western areas, HIV/AIDS and hepatitis B prevention and control, epidemics investigation and other items. One-third of the total investment, or 290 million yuan (US$35 million), will go towards purchasing equipment for the national network for disease control, which played a pivotal role in China's fight against SARS (severe acute respiratory syndrome). Zhao also announced that 250 million yuan (US$30 million) will be spent on the purchase of 1,060 emergency vehicles, 80 million yuan (US$9.6 million) will buy advanced medical equipment for Beijing Hospital, and 72 million yuan (US$8.7 million) will be spent on hepatitis B vaccine and other tools. China adopted the law on governmental purchase bidding in 2002. The ministry set up a co-ordination team to oversee the purchases in April. Zhao added his ministry will spend 3 billion yuan (US$361 million) on equipment in 2004.

From http://www1.chinadaily.com.cn/ 08/19/2003

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China Ups Anti-Graft Fight

HONG KONG, China (CNN) -- The administration of Chinese President Hu Jintao has pledged to redouble efforts against graft, particularly big cases involving senior cadres. While touring Jiangsu Province in the past week, the Politburo member in charge of fighting corruption, Wu Guanzheng, gave a severe warning to "leading cadres who have a cavalier attitude toward discipline." Wu, deemed a Hu ally, is also head of the Communist party's Central Commission on Disciplinary Inspection (CCDI), the nation's highest anti-graft body. "We must put emphasis on more scrutiny and supervision regarding clean government," state media on Wednesday quoted Wu as saying. "We must deepen the work on fighting graft and building clean government," Wu added. Beijing sources close to the Communist party said Wu and his CCDI colleagues were under heavy pressure owing to their high-profile investigation of "premier Shanghai tycoon" Zhou Zhengyi. Zhou, who got rich in the late 1990s through speculation in the stock and real-estate markets, was detained by the authorities earlier this year for alleged corruption and business related practices. The sources said since the CCDI was also investigating Zhou's patrons and business partners -- including several senior members of the powerful Shanghai Faction in party politics -- the anti-graft investigators had met with stiff resistance. It is understood, however, that while work on the Zhou case has slowed down, Wu and President Hu want to relay the message that they will continue to go after the "big tigers" among corrupt cadres. Earlier this week, party authorities said that the CCDI as well as the party's Organization Department would send "roving inspectors" to the provinces to check on corrupt cadres and improper business practices. This year, a team of around 45 inspectors will be doing investigation work in the provinces of Guizhou, Hunan, Jilin, Jiangsu and Gansu. While Wu and the CCDI have been criticized for failing so far to bring down senior corrupt cadres in Shanghai, they have scored big in other provinces. Earlier this month, former party chief of Hebei Province Cheng Weigao was kicked out of the party for his involvement in a graft scandal that had already incriminated his two former secretaries. Analysts said while Cheng was not given a jail term, his political disgrace was nonetheless remarkable in view of his high-placed patrons in Beijing. In other developments in China, two bank employees were sentenced to death for embezzling 412 million yuan ($49.8 million), state-run media reported on Wednesday. The pair -- the head of a local branch of the state-owned China Construction Bank and another staff member of the same branch -- were found guilty of attracting savings from firms and individuals by offering high interest rates. However, they did not register the deposits and kept the money for their own use, the China Daily reported. (by Willy Wo-Lap Lam)

From http://edition.cnn.com/ 08/20/2003

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Chinese Bank Staff Sentenced to Death for Embezzlement

Two employees of the state-owned China Construction Bank have been sentenced to death for embezzling $US50 million. China's official media says the Intermediate People's Court in the north-western province of Shaanxi handed down the sentences to the head of a local branch of the bank and one of his staff. China is battling rampant crime in the financial sector and is pushing reforms of big state banks amid growing foreign competition as the country opens up under the World Trade Organization.

From ABC Radio Australia News 08/20/2003

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Mainland Won't Set Limits on Taiwan Election, Official Says

A senior Taiwan affairs official of the central government says the mainland will not impose any preconditions or limits to next year's Taiwan election. Dialogue with Taiwan regional parties and organizations will be conducted according to the one-China policy. Deputy Director of the Taiwan Affairs Office of the State Council Wang Zaixi says the mainland is willing to hold talks with Taiwan regional parties and organizations which recognize the one-China principle. He also says the mainland will not impose any limits on next year's Taiwan election. Wang said, "The election is totally Taiwan's regional affair. The mainland will not impose any preconditions or limits to this election. We do not support specific parties and their candidates, and we are not concerned about their background. We rule out the possibility of entering cross-Straits talks with parties which do not recognize the one-China principle. However, our stance has nothing to do with their elections." The senior official says the mainland has been working hard to improve cross-Straits relations in the past three years. But, the Taiwan authorities refuse to accept the one-China principle, deny the "1992 consensus reached between the two sides," and promote Taiwan independence elements. For the last three years, the Taiwan authorities have not shown a sincere commitment to improve the relationship with the mainland and this is the root cause of tension across the Straits.

From CCTV.com 08/24/2003

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Chinese Court Unveils 23 Reform Measures

BEIJING, (Xinhuanet) -- The Supreme People's Court of China unveiled 23 reform measures aimed at improving the efficiency of the Chinese court system at a symposium held in Beijing from Sunday to Monday. The Supreme People's Court will clear the backlog of cases by the end of September while subordinate courts will finish by the end of November. In the future, there will be no more detention in excess of the legally permitted period. Excessive periods of detention, attributed to poor efficiency of courts and sometimes personal factors, has drawn harsh public criticism in China over recent years. Courts across China hear more than six million cases every year but many were outside the prescribed time period set by the Supreme People's Court, according to statistics released at the symposium, attended by presidents of provincial higher people's courts. At the symposium, the Supreme People's Court also urged the stepping up of mediation efforts, which it said was an effective and low-cost approach to address the piling up of lawsuits. According to the symposium, 76.7 percent of cases received mediation in 1989 while the ratio dropped to 30.78 percent in 2001. The package of reform measures also included answering complaints in the set time and soliciting public views on major interpretations of the law.

From http://news.xinhuanet.com/ 08/25/2003

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JAPAN: Koizumi Says Reformers to Make Up New Cabinet

Prime Minister Junichiro Koizumi defied his foes Tuesday, stating that if he wins re-election in the Sept. 20 LDP presidential poll, the subsequent Cabinet he forms will be made up of individuals who support his policies. At a news conference to mark Monday's close of the ordinary Diet session, Koizumi said his key pledges in the Liberal Democratic Party poll will be to privatize postal services in April 2007 and to submit a bill aimed at privatizing public expressway companies in the next ordinary Diet session, which begins in January. Koizumi's term as LDP president and thus prime minister ends Sept. 30. If re-elected, he will have three more years to serve. "If I am re-elected, I will work to make a law to privatize postal services in three years so that the privatized services will begin in April 2007," Koizumi said. "I want to raise this issue in the September presidential election." LDP lawmakers opposed to Koizumi's economic policies and postal service privatization want him to drop plans to create a small government and instead embrace a big government that spends more to prop up the economy. Koizumi reiterated Tuesday, however, that he has no intention of changing his structural reform drive. "I will definitely continue on with my reform steps and will fight firmly those who try to nip the buds of reform." Koizumi has angered his foes in the LDP by repeatedly saying his policy pledges in the LDP election will be the party's platform in the next House of Representatives election, widely expected to be held in November. He made the same remark Tuesday, suggesting that those who do not support him in the LDP election will not be considered for the Cabinet if he is re-elected. "I believe a new Cabinet will be necessary after the presidential election to bring in people who support my reform agenda and who can assume the appropriate ministerial posts," Koizumi said. "But I have not decided who will fill those posts. . . . I will decide after watching the presidential election." Referring to a newly enacted law to send Self-Defense Forces elements to Iraq, Koizumi stressed that Japanese military units will be dispatched only after a government fact-finding mission that may be sent in August deems the security situation to be safe. The law stipulates that SDF units will operate only in noncombat areas, but opposition parties have said it is impossible to demarcate such areas at present in Iraq. The government may privatize Japan Post, a public corporation dealing with postal services, in fiscal 2007 in line with Prime Minister Junichiro Koizumi's plan, Chief Cabinet Secretary Yasuo Fukuda said Tuesday. "A prime minister's idea should be a policy of the government," he said. Koizumi and government officials will soon start work on fleshing out the plan, Fukuda said. Koizumi told reporters earlier Tuesday that the postrelated public corporation should be privatized in April 2007, the starting month of fiscal 2007. Koizumi said he is willing to start working toward the body's privatization, including efforts to make relevant new laws, if he is re-elected leader of the Liberal Democratic Party in the Sept. 20 party race. Re-election as party leader in the poll may allow him to serve as prime minister until September 2006 unless the LDP-led ruling coalition loses control of the Diet. Koizumi is a proponent of privatization of the three postal services of mail delivery, postal savings and "kampo" life insurance. But many LDP lawmakers with vested interests in such services oppose the idea. Japan Post was set up on April 1 as a public corporation to take over the Postal Services Agency's postal services. (by Junko Takahashi)

From The Japan Times 07/30/2003

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Foreign Ministry Fires Yet Another Corrupt Official

In the latest in a string of money-related scandals, the Foreign Ministry on Friday sacked a 53-year-old official suspected of misusing about 6 million yen in public funds during the four years he was assigned to the Japanese Embassy in the Solomon Islands. The ministry also filed a criminal accusation against the official, Seijiro Shirahama, with the Tokyo District Public Prosecutor's Office on suspicion of embezzlement. According to the ministry, Shirahama, a former first secretary at the embassy who was in charge of accounting, withdrew a total of 6 million yen in embassy funds on several occasions between January 1995 and February 1998 and remitted the money to his personal account at a bank in Tokyo's Minato Ward. Shirahama was suspended from his duties for four months in September 2002 for using embassy money to purchase several items for his personal use, including a TV, which he later sold to the official who succeeded him, according to the ministry. The embezzlement came to light after the ministry closely examined the embassy's accounts in the wake of the TV incident.

From The Japan Times 08/09/2003

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Government Workers Face Pay Cuts

The National Personnel Authority proposed record salary cuts Friday for central government employees -- a reduction of 163,000 yen to some 6.15 million yen in average annual pay -- to make the levels commensurate with sagging private-sector wages, government officials said. The cuts, if carried out, would slash state costs by some 231 billion yen in the initial fiscal 2003 budget, the Finance Ministry said. Prime Minister Junichiro Koizumi, who received the recommendations Friday morning, told reporters that the government will introduce the pay cuts. The recommendations call for reducing civil servants' monthly salaries by 1.07 percent, or 4,054 yen on average, and cutting annual bonuses by an amount worth 0.25 of a month's salary, to 4.4 months of salary in fiscal 2003. The authority has proposed cuts in annual wages for five straight years. It initially recommended only cuts in bonuses, however, and this is the second year it has called for monthly salary reductions.

From The Japan Times 08/09/2003

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Mitsuzuka to Retire from Politics

SENDAI (Kyodo) Hiroshi Mitsuzuka, a senior lawmaker of the Liberal Democratic Party and a former finance minister, formally announced Monday he will retire from politics due to health reasons and not run in the next House of Representatives election. One of his supporters read out a message by the lawmaker at a gathering of his top supporters in the city of Iwanuma, Miyagi Prefecture. Although Mitsuzuka said he would like his policy secretary, Akihiro Nishimura, to succeed him, the matter was to be discussed further because some expressed dissatisfaction with his choice, participants said. Mitsuzuka, representing the No. 3 constituency in Miyagi Prefecture, is serving his 10th term since being first elected to the Lower House in December 1972. He was a member of the Miyagi Prefectural Assembly before becoming a parliamentarian. The 76-year-old lawmaker had served in many posts, including transport minister, international trade and industry minister, foreign minister, LDP policy chief and LDP secretary general. Mitsuzuka's health deteriorated in early June after he injured his back and he has been resting at his residence in Tokyo's Setagaya Ward and other places, the sources said.

From The Japan Times 08/12/2003

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Eight to Vie for Saitama Governorship

SAITAMA (Kyodo) Eight people filed their candidacies as official campaigning began Thursday for the Aug. 31 Saitama gubernatorial election. The post was vacated by Yoshihiko Tsuchiya, who resigned last month over a political funds scandal involving his daughter. The race is widely considered to be a dry run for the House of Representatives general election, which could take place as early as this fall. It is expected to be a close race because all of the candidates, save one supported by the Japanese Communist Party, have refused to receive any backing from the national headquarters of major political parties. The number of candidates is the highest since 1949, when nine people vied for governor of the prefecture. Two of the eight candidates are Diet lawmakers who have given up their seats to run as independents -- Kiyoshi Ueda, 55, who served in the Lower House and was vice secretary general of the Democratic Party of Japan, and Takujiro Hamada, 61, who belonged to New Komeito in the House of Councilors. Other candidates include Akira Shimazu, 60, former vice minister for public management, home affairs, posts and telecommunications, who is backed by the local chapter of the ruling Liberal Democratic Party; former Cabinet Office gender bureau chief Mariko Bando, 57; former Saitama Municipal assemblyman Tomosuke Sugisaki, 40; and security business executive Morio Kato, 62. All are running as independents. Former Saitama Prefectural assemblywoman Misako Takahara, 60, is running with the support of the JCP, and businessman Setsuo Yamaguchi, 53, is backed by a minor party. Tsuchiya resigned as governor on July 18 after the arrest of his daughter, Momoko Ichikawa, who was subsequently charged with misappropriating 116 million yen in political funds donated to Tsuchiya between 1998 and 2002. Tsuchiya has not been indicted, although prosecutors from Tokyo interrogated him over his possible involvement in the fund misappropriation. Despite Tsuchiya's resignation, most of the candidates in the upcoming election say they support much of the policies that he pursued in his 11 years in office. Many of them are campaigning for general measures such as fiscal discipline and greater disclosure of administrative information. This is making it difficult for the prefecture's 5.6 million eligible voters to determine the issues at stake. After registering her candidacy, Bando promised to beef up public support for child rearing. She said she is pursuing a grassroots campaign with support from women's organizations. The LDP-backed Shimazu, meanwhile, is counting on organized votes. Hamada insisted that the former bureaucrats are not up to the task of reforming the prefecture's administration, while Ueda pledged to run the prefecture more efficiently.

From The Japan Times 08/15/ 2003

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Foreign Ministry Reports on Recruitment Reforms

The Foreign Ministry has recently reported on recruitment reforms aimed at preventing nepotism that were implemented last August. In the report, obtained Sunday by Kyodo News, the ministry said it "will never give favorable or adverse treatment to children of its staff in recruitment processes." The ministry also gave details of recruitment from the private sector, which the ministry intends to make public soon. A series of scandals involving ministry officials -- including the embezzlement of public funds -- has angered the public, prompting the ministry to propose reforms. The ministry issued an earlier assessment in March. The latest report covers key areas that were singled out as requiring further improvement during a review of the earlier report. The March assessment was reviewed in April by an advisory panel to the ministry headed by Orix Corp. Chairman Yoshihiko Miyauchi. Miyauchi said the ministry needed to disclose the uses of the Cabinet Secretariat's secret funds budget, which covers, among other things, expenses for the prime minister's trips. Miyauchi also said the ministry had not appointed any mid-level or junior bureaucrats as ambassadors despite calls to do so. On recruitment in the latest report, the ministry listed 14 items for evaluating job applicants, including flexibility, dynamism and debating skills. According to the report, the ministry has also included the statement: "In selecting its staff, the ministry will judge applicants chiefly by their personal character and ability, and not by their universities." The report says the ministry currently has 26 senior officials from organizations outside the ministry, 18 of whom are ambassadors. However, the ministry failed to disclose the uses of the Cabinet Secretariat's secret funds budget, saying: "It will be impossible to disclose it even 20 years from now. "The ministry will make efforts to utilize the budget strategically." In March last year, Foreign Minister Yoriko Kawaguchi commissioned the panel of outside experts to formulate ideas on improving the ministry following a series of scandals, including public-funds fraud by ministry officials and improper ties with lawmakers. Following the release of the assessment report in March, the advisory panel was disbanded.

From The Japan Times 08/18/2003

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SOUTH KOREA: Agency Provides Advanced e-Customs Services

The Korea Customs Service (KCS) released on Tuesday (July 29) statistics on its e-customs services, saying that the number of such services has reached 10 million a month. KCS first began providing electronic customs services in 1994 and has steadily modernized the services since then. Its modernized and simplified services led to a drastic increase in the number of customs cases it processed. The Tuesday statistics also showed that by 2002 the agency's monthly e-customs service average reached above 9 million cases, and that the figure posted over 10 million in June 2003, which meant savings of approximately 2.5 trillion won in handling costs. The KCS also said that it began in July 2000 to process 95 percent of the nation's entire exports through electronic means, requiring no papers, with each case completed in less than 2 minutes. Processing imports also took much less time, only an hour and a half for each case. The agency said it would continue to improve its "one-stop" and "single-window" systems so as to provide its customers with much simplified and advanced customs services.

From http://www.kois.go.kr/ 07/30/2003

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NK Holds General Elections

North Koreans yesterday cast their ballots in the first general elections in more than five years to choose deputies in their legislature and local councils, the North's state media reported. The elections, the first since July in 1998, came amid the communist country's confrontation with the United States over its nuclear weapons program. The North's Korean Central News Agency said voters cast their ballots with ``revolutionary zeal'' when polling stations opened at 9 a.m. across the country. It gave no further details. The elections were to select 687 members of the North's rubber-stamp legislature, the Supreme People's Assembly, and about 29,000 local council members. Assembly candidates included the country's supreme leader, Kim Jong-il. The North's legislature has the power to plan and approve the government's budget and handle major state affairs. It convenes irregularly once or twice a year. The North's leader rarely attends an Assembly session. The North's ruling party newspaper, Rodong Sinmun, ran an editorial urging all eligible voters to take part in the elections, which, it said will strengthen Kim's leadership based on the army-first policy. ``The elections will ensure the Supreme People's Assembly and other legislative bodies will be filled with revolutionaries yearning for patriotism and the spirit of the army-first policy,'' the editorial said, part of which was carried by the KCNA. North Korea has an ailing economy and relies on outside aid to help feed its 22 million people.

From The Korea Times 08/03/2003

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Customs Service Implements Volunteer Customs Agent System

The Korea Customs Service began to implement a "volunteer customs agent" system August 1 to build an effective customs administration based on partnership with the private sector, particularly the export and import fields. The volunteer customs agent system was introduced to cope with the dwindling customs personnel in the face of newly emerging business areas. In addition, it aims to improve the traditional tasks of increasing revenues and preventing smuggling attempts. The new task is the prevention of introduction in to the country of fire arms, illegal drugs, terror items and other items that are injurious to social security. In addition, the new team will crackdown on unfair trade practices like false country-of-origin labels and goods violating intellectual property rights and prevention of assets flight abroad. Major work assigned to the volunteer agents will be surveillance and smuggling prevention in customs houses at airports and ports, provision of customs-related information, publicity activity aimed at preventing smuggling and suggestions about customs service improvement and research administration.

From http://www.kois.go.kr/ 08/05/2003

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FSS Expands Statistical Service for Public

The Financial Supervisory Service (FSS) reported on Thursday (August 7) that it is taking steps to database finance-related statistics in a way to make them more accessible to the general public. The move came as part of the agency's effort to provide a wider range of financial statistics to the public in a more accessible way. The agency has thus far used its monthly booklets and its Internet homepage to release financial statistics, but the services were somewhat limited in terms of the range and volume of information and did not offer the public an easy access.

From http://www.kois.go.kr/ 08/08/2003

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Arrest of Kwon to Speed Up Political Reform

After the sudden arrest of Kwon Roh-kap, a close aide to former President Kim Dae-jung, on Monday night, President Roh Moo-hyun's reaction is likely to attract increasing public attention in relation to his much-touted drive toward political reform. So far, the presidential office of Chong Wa Dae has assumed the attitude of onlooker. President Roh made no particular comment after being briefed about the case from Justice Minister Kang Kum-sil. Yoon Tai-young, presidential spokesman, said, ``It is not appropriate for Chong Wa Dae to comment on this case, as the Roh Moo-hyun government does not intervene in the state prosecution's investigations.'' However, the presidential office seems to be taking a similar stance to when Chyung Dai-chul, chairman of the ruling Millennium Democratic Party (MDP), was prodded by the prosecution last month. A common feature in the two cases, involving two political heavyweights, is that they gave immediate rise to ``conspiracy theories'' related to political realignment being pushed for by Roh's liberal loyalists. Kwon's arrest has prompted fierce reactions from the old-guard faction, which opposes moves in the MDP to create a new reformist party. The so-called Tonggyo-dong faction, composed of former president Kim Dae-jung's long-term followers, has been the most influential group in the MDP, but is now being cornered in the course of debates over how to form a new party. Kwon's arrest will surely deal a serious blow not only to the Tonggyo-dong faction, but the old guard in general. Though Roh is being accused of benefiting from slush funds allegedly given by the Hyundai Group to Kwon, the president seems determined to go his own way for political reform by getting rid of the ``figures of the old evil.'' Kwon, who has often been criticized for his behind-the-scenes role as a mastermind of the Tonggyo-dong faction, is accused of receiving a large sum of money from Hyundai. The problem is that some of Roh's lieutenants spearheading the new reformist party drive are said to have received monetary aid from Kwon, who sees himself as a ``stopover'' for political money. A Chong Wa Dae official brushed off any possibility of conspiracy plots, saying Roh is ready to give up even his right-hand man to realize political reform. Well known for his fight to ease regional divisions, Roh has longed for the realignment of politics based along regional lines to one based on ideological orientation and policy lines. Roh and his followers believe old-fashioned politics is characterized by money-draining elections, regional animosity and backstabbing. (by Ryu Jin)

From The Korea Times 08/12/2003

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Hopeful Steps for Local Autonomy

The administration of President Roh is taking steps to promote several good practices for local autonomy in South Korea. Over the last two weeks, the government has proposed that major issues affecting residents be decided by regional referenda and that local governments receive subsidies for business relocations from Seoul to the provinces. First, it is nice to see President Roh, who promised to make citizen participation a major theme of his administration, call for regional referenda on major issues from late next year. These local-led efforts would not extend to matters of finance and administration, but hopefully they will provide a way to resolve divisive issues such as that concerning the Saemangeum project. The government's proposal would require that one-fifth of citizens, or two-thirds of local council members, request the referendum. One-third of local residents would then have to participate in the polling, which would be decided by majority vote. Citizens and commentators often eschew forms of direct democracy _ hear the cries of foul from many in the United States concerning the recall petition of California Governor Gray Davis. Of course, the pitfalls of referenda, recalls and initiatives are well known, and demagoguery, factionalism and lack of information should not be encouraged. However, the pitfalls are not peculiar to direct democracy and all of them have analogues in the processes of representative democracy. If it is not always the case that elected leaders and government officials accurately understand the wishes of their constituents, local autonomy needs a possibility like the referendum. Were the people to lack such an option to ask for the redress of their grievances, the legitimacy of a constitutional order or political regime would be lessened. A second positive step concerns the provision of mechanisms for regional economic development. Since just 266 companies, and only three with more than 300 employees, have relocated from Seoul over the last two years, the government also is wise to support measures to subsidize relocation costs. Beginning in 2004, 50 percent of the bill for moving large companies will be subsidized and local governments with little industrial development will be eligible to receive a 50 percent subsidy for costs of attracting businesses. Those with better economic situations would receive some support as well. This proposal could stimulate the kinds of business investment decisions that would enable President Roh to make good on another administration promise: To lessen the over-concentration of the Korean economy in and around Seoul. The popularity of tourism and regional festivals within the provinces is a wonderful asset but they should form only one part of economic growth efforts. Many state and local economies in the U.S. suffered serious losses following September 11, 2001, and the impact on travel and associated businesses continues. Provincial economies require a balance of agricultural, industrial and other concerns to achieve their fullest potential in an uncertain world. One of the less frequently discussed topics in political economy is the evenness of economic development within nations. When travelers visit a country, they most often take in the brightest spots, the richest areas and the most appealing in terms of conveniences. In every country, the problems of regional over-speculation, over- and under-investment and gaps in income and standards of living constitute enormous, hidden negative externalities or ``sunk costs'' that contribute to higher mortality rates, unemployment and crime rates and other negative indices. The strength of an economy is measured not only by its gross domestic product but also by how well it is distributed and how well its many local governments, large and small, contribute to it. I hope that in due course the National Assembly will authorize both of these measures for local autonomy, backed by the strong support of all Korea's political parties. Regional economic development should be a non-partisan priority. And in a representative democracy, no president can be the engine for progress alone. The legislative branch and the citizens of Korea should rally around these proposals for the good of all Koreans in the 21st century. Bernard Rowan is associate professor of political science at Chicago State University, Chicago, Illinois. (by Bernard Rowan)

From The Korea Times 08/12/2003

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Government to Present Its Innovative Procurement System at APEC Meeting

The Public Procurement Service reported on Wednesday (Aug. 13) that it would make a presentation on "innovations the government made in procurement areas through digitalization" to the Government Procurement Experts Group (GPEG) at the Third Senior Officials' Meeting (SOM III) of the Asia Pacific Economic Cooperation (APEC), which is scheduled for Aug. 15-16 in Phuket, Thailand. The Government Procurement Expert Group is a forum organized to enhance mutual understanding and work out common international norms among procurement experts of the member states in such areas as ensuring transparency in public and private procurement, effective competition, efficient budget execution and appropriate procedures to solve disputes. This year, procurement experts from 21 member countries are expected to attend the conference. At the forum, the Public Procurement Service will brief on the background, current status and future of Korea's G2B (Government to Business) project, which is the Korean government's integrated electronic procurement system and implementation procedures. It will also make positive efforts to explore the way for Korean SI (System Integration) companies to advance into overseas markets by promoting cooperation with member states.

From http://www.kois.go.kr/ 08/14/2003

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Female Named for Constitutional Court

Chief Justice Choi Jong-young yesterday nominated Chon Hyo-suk, a female judge at the Seoul High Court, as successor to a retiring justice of the Constitutional Court. If President Roh Moo-hyun endorses the nomination, Chon will be the first woman to serve at the nine-member court, which was established in 1988 to handle constitutional petitions. The presidential endorsement is regarded as a matter of course because the president, the chief justice and the National Assembly are endowed with exclusive rights to name three of the nine Constitutional Court justices. Chon will replace Han Dae-hyun, a former senior judge who will serve out his six-year term at the Constitutional Court next Monday. She had been touted as one of the major candidates for the Constitutional Court because Chief Justice Choi was said to have wanted to use the nomination as a counterbalance against his choice of three conservative male judge candidates. Chon, 52, has been reputed for a series of verdicts based on her progressive views. A spokesman for the chief justice said Chon was nominated because she was considered the right person to promote the interests of the underprivileged and minority groups in society. "I feel heavy responsibility as the first female Constitutional Court justice," Chon said after her nomination was announced. "I will do my utmost to serve the interests of the people." A Constitutional Court official, speaking on condition of anonymity, said he expects Chon, who has proven her ability as judge, to put forward her progressive views aggressively on constitutional issues. Chon, born in Seungju, South Jeolla Province, graduated from the law college at Ewha Womans University in 1973 and passed the state judiciary exam in 1975. She had served in various posts at the Seoul District Court, the Suwon District Court and the Patent Court until being appointed as senior judge at the Seoul High Court in 2001. She handled an appeals trial of Kim Hong-gul, former President Kim Dae-jung's third son convicted of taking bribes from companies last year. (khkim@heraldm.com) (by Kim Kyung-ho)

From http://www.koreaherald.co.kr/ 08/20/2003

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Ministry Files Report on Operation of Government Funds

The Ministry of Planning and Budget (MOPB) said on Monday (August 18) that it has submitted, as required by law, its evaluation report of government funds for 2002 to the Cabinet. The report unveiled that 46 funds, out of 58, were examined. Twelve of them were either discontinued or newly set up in 2002. The review was conducted focusing on two major areas: administrative improvement and efficiency in asset operation. Specifically, particular emphasis was placed on the review of reform efforts; the level of efficiency, especially in personnel management; pertinence of funds; and the results of individual project performances. A total of 402 projects, including loan projects and capital expenditure cases, underwent scrutiny. A team of 42 civilian specialists, including university professors, researchers and certified public accountants, conducted the review for four months since April. For a more effective operation of these funds, the team recommended the introduction of result-oriented initiatives and the development of long-term goals with action plans.

From http://www.kois.go.kr/ 08/20/2003

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Roh to Accept Choice of Justice Candidate

President Roh Moo-hyun will accept the chief justice's recommendation of a final candidate to replace a retiring Supreme Court justice, officials at Cheong Wa Dae indicated yesterday. "It is necessary to respect the opinion inside the court," said a presidential aide after it came to be known that judges representing courts across the country agreed to support Chief Justice Choi Jong-young's choice of justice candidates during their meeting Monday. Chief Justice Choi will soon recommend a final candidate chosen from his initial list of three conservative senior judges to President Roh, court sources said. Roh will make the formal appointment after the National Assembly holds hearings and a vote on whether to approve the justice candidate. The escalating dispute over the chief justice's selection of candidates to succeed a retiring justice at the nation's most senior, 14-member court was settled during the unprecedented session of about 70 judges from courts across the nation. A majority of participants agreed on the need to stand behind the chief justice with regard to the selection of justice candidates, while some protesting judges insisted the list of names should be revised in the name of judicial reform. Most of the judges in the meeting apparently shared the view the current discord should not be aggravated to further destabilize the court and the public's trust in the judiciary, court sources said. The Supreme Court, for its part, tried to assuage frustrated younger judges aspiring to accelerate judicial reform through personnel changes by pledging to take into account their demands in nominating candidates for key judicial posts. "The various views put forward at the judges' meeting will be seriously considered by the chief justice," said Sohn Ji-ho, spokesman for the Supreme Court. "Some justices at the Supreme Court have agreed on the need to improve the process of selecting and recommending justice candidates," he added. Chief Justice Choi's list of initial candidates greatly disturbed a group of judges as well as reformist lawyers and civic group leaders. Two advisory members walked out of a meeting last week that was held to evaluate the three candidates suggested by the chief justice, protesting against the discussion being restricted to the given list. A group of 159 judges subsequently signed and submitted a letter to the chief justice requesting he reconsider the list of candidates - composed of chiefs from two high courts and a district court. President Roh and his aides, who have advocated judicial reform, appeared sympathetic to calls for the chief justice to redraw his list to include liberal figures. Some presidential officials even suggested Roh would veto the chief justice's recommendation. But the conclusion of Monday's marathon meeting of judges was a decision by the presidential office to respect Chief Justice Choi's opinion. Judiciary observers noted President Roh and his aides might have felt it too burdensome to confront the judicial establishment given the current context of conflicts dividing society. According to them, the latest discord may only signal an ensuing collision between liberal and conservative forces in the judicial community over the reshuffle of the highest court. During Roh's five-year presidency that will expire in February 2008, 12 of the 14 Supreme Court justices including Chief Justice Choi will serve out their six-year term. (by Kim Kyung-ho)

From http://www.koreaherald.co.kr/ 08/20/2003

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President Pledges Labor Reform

President Roh Moo-hyun vowed to reform Korea's labor structure within the next two years yesterday, so that it would meet international standards and make Korea more attractive to foreign investors. "From business accounting and corporate governance to the market order and financial system, everything that does not measure up to global standards will be reformed," Roh said at the opening ceremony of the 36th International General Meeting of the Pacific Basin Economic Council. About 500 people are participating in the council's annual meeting, which will run through tomorrow at Seoul's Shilla Hotel. "A special committee is now working on a detailed proposal for labor reform that will be approved and implemented within one or two years," Roh said. He also pledged decentralization and support of high-technology industries to advance the nation's competitiveness. On the North Korea issue, the president expressed hope for a peaceful resolution, saying he predicts good results at the six-party talks that start Wednesday in Beijing. The president said his government is pledging fair treatment of foreign businesses. "There will be no distinction between Koreans and non-Koreans. Competitive edge will be the only criteria deciding success and failure," he said. PBEC Chairman S.R. Cho said that the region needs multilateral security cooperation more than ever. He noted that the world is facing the difficult problem of addressing public security under the possible threat of use of weapons of mass destruction in the hands of rogue nations and terrorist groups. Cho, who also heads Korea's Hyosung Corp., noted that alarms are being sounded about the lack of progress in forming an agricultural sector agreement at the Doha round of negotiations for the World Trade Organization. He warned that this might doom the entire round. "Freer trade and global market have contributed enormously to raising the standards of living throughout the world, most obviously in Asia-Pacific region. We must become more proactive in searching for solutions of key issues," he said. PBEC Korea Chairman Park Young-ju said he hoped that the Seoul IGM would reaffirm PBEC's goal to become the "voice of business" in the Asia-Pacific region. "To this end, I would like to ask you to make this IGM a forum in which you would intentionally exchange diverse opinions, share visions for a new PBEC, and build lasting friendships among participants," he requested of the businessmen and politicians present. Park is also the chairman of Eagon Corp. The PBEC delegates moved to the Grand Hyatt Hotel later in the day to attend a gala opening dinner and listen to speakers, including the visiting Thai prime minister, Thaksin Shinawatra. During the opening dinner, PBEC held an awards ceremony for the annual PBEC Environment Award. Sony Korea won the Gold Prize, China Steel the Silver Prize and Korea's Taegu City Gas the Bronze Prize. The dinner included a performance by a group of Korean traditional artists including Park Yoon-cho, a master of "pansori", a type of traditional Korean music. (by Kim Mi-hui)

From http://www.koreaherald.co.kr/ 08/25/2003

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Roh Names Professor Audit Agency Chief

President Roh Moo-hyun yesterday designated Yoon Sung-sig, a public administration professor at Korea University, as new chief of the Board of Audit and Inspection. Yoon, a reform-minded scholar, has practical knowledge in the overall field of social science and is recognized globally as an audit expert, said Jeong Chan-yong, advisor to the president for personnel affairs, in a press briefing. "Yoon, the candidate to replace Lee Jong-nam (whose term expires next month) is expected to take the lead in reforming the BAI," Jeon said. The president plans to officially appoint Yoon on Sept. 29 if the National Assembly approves his designation during its ordinary session early next month. The 50-year-old scholar, to whom Roh reportedly gives much credit for his vision and strategies for reforming the government sector, is believed to have provided the administration with a theoretical basis for its push for administrative reform. A native of Haenam, South Jeolla Province, Yoon has taught public administration at the university since 1992. He also worked as a member of the transition team after Roh was elected as president last December. (by Sim Sung-tae )

From http://www.koreaherald.co.kr/ 08/26/2003

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INDONESIA: MPR Urged to Campaign Against Corruption

Academics and non-governmental organizations demanded on Monday that the People's Consultative Assembly (MPR) declare war on corruption in its final recommendation to be released at the end of its current Annual Session. In separate meetings with the Reform faction and the National Awakening faction of the MPR, they also called on President Megawati Soekarnoputri to establish the planned anticorruption commission immediately. The meetings between the MPR factions and a group of academics-activists calling itself the People's Anticorruption Movement (Garansi), were held on the sidelines of the MPR annual meeting here. The group was led by rights activist Bambang Widjojanto, who is also a former chairman of the Indonesian Legal Aid Foundation (YLBHI). The MPR annual meeting is scheduled to end on Thursday. "We want to avail of this opportunity to raise awareness among the public and government officials that corruption is an extraordinary crime that demeans the dignity of Indonesians, and therefore we must start fighting all out against corruption," Bambang told reporters after the meeting with the Reform faction. Political analyst Eep Saefulloh Fatah asserted that the war on corruption be enshrined in a special decree issued by the MPR at the end of its ongoing session. "It may be unrealistic, but at the very least the MPR should accommodate the feelings of most ordinary Indonesians, who want corruption to be uprooted from Indonesian soil," he said. Bambang stressed that the issue of corruption was still of great importance today and needed to always be highlighted due to the fact that the efforts made so far to fight corruption had yielded no results five years after the start of the reform movement. The reform movement swept the nation in 1998, with the combating of corruption being one of its ultimate goals. Corruption would likely increase ahead of the general election and the country's first ever direct presidential election in 2004. "The parties will be competing to win as many seats as possible, and the 2004 election contest will likely be rife with corruption," said Bambang during a press conference here. Also during the press conference, Revrisond Baswir, a lecturer at the Yogyakarta-based Gadjah Mada University, led his fellow academics and NGO activists in reading out a declaration urging a war on corruption. The declaration called on all elements of the nation to free themselves from corruption immediately. It also demanded that the government immediately establish the anticorruption commission and that an extraordinary court be set up to prosecute suspected corruptors. According to the declaration, the war against corruption must be started immediately as it was still rampant in the country. Corruption was also a crime against humanity that hurt the economy and drove people into poverty. The academics and activists complained that the process of establishing the anticorruption commission was being carried out at a snail's pace. The Anticorruption Law No. 30/2002, which was passed in November of last year, stipulates that an anticorruption commission must have started working by Dec. 27 of this year at the latest. "But, so far the government has only started proposing the names of people who will serve on the committee to select the candidate members of the anticorruption commission," Garansi said in a release made available to the media. Given the slow pace involved in the establishing of the anticorruption commission, the group demanded that the President pick up the names of the committee members by Aug. 16 of this year at the latest. (by A'an Suryana)

From http://www.thejakartapost.com/ 08/05/2003

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House, Govt, MA Rush to Select Constitutional Court Judges

Following the approval of the constitutional court bill by the House of Representatives, the government, House of Representatives and the Supreme Court will now have to work hard to select judges for the court before the Aug. 17 deadline. Each of the three institutions have to appoint three judges to the Constitutional Court before this date, making up a total nine judges. The House's Commission II on legal affairs plans to conduct selection hearings for its candidate judges on Aug. 13 and August 14, and will make its selections on Aug. 15, commission chairman Agustin Teras Narang said on Thursday. Meanwhile, Minister of Justice and Human Rights Yusril Ihza Mahendra said that the government would also appoint three judges before Aug. 17. Chief Justice Bagir Manan said on Thursday that the Supreme Court had already identified a number of candidates for the Constitutional Court. The Supreme Court would soon make a definitive selection of three of these, all of whom are high court judges. After the three institutions appoint their judges to the Constitutional Court, the court will be officially inaugurated on August 17 at the latest. The nine judges of the Constitutional Court will serve for five years, with the possibility of reappointment for a further five-year term. The selection of the Constitutional Court judges is now essential following the House's endorsement of the constitutional court bill late on Wednesday evening. Wednesday's plenary session was convened amid the Annual Session of People's Consultative Assembly, which also comprises all the members of the House. As the deadline for the selection of the nine judges nears, it is clear that little public participation will be involved in the selection process. In fact, the selection process in the House of Representatives will be the most ostensibly democratic as it will involve selection hearings for each candidate before a final decision is made. Commission II chairman Teras Narang said on Thursday that his selection team would invite each faction in the House to nominate a maximum of three candidates. After that, Teras said, the selection team would listen to suggestions from the public before holding its selection hearings. The final results of the selection process would be presented to the House plenary session on Aug. 15. The commission had identified four candidates so far. Agun Gunandjar Sudarsa of the Golkar faction disclosed on Thursday that his faction would nominate three candidates and one of them would be Andi Mattalata, a Golkar legislator. If selected, Andi would have to relinquish his membership of Golkar as the bill prohibits a judge of the new court from simultaneously serving as a state official, being a member of a political party, running a business, or working as a lawyer or civil servant. Meanwhile, Mutammimul Ula of the Reform faction revealed that his faction would likely nominate constitutional law experts Jimly Ashidiqqie of the University of Indonesia, Dahlan Thaib of the Yogyakarta-based Indonesian Islamic University, and Mukti Fadjar of the Malang-based Brawijaya University. The Constitutional Court will have the power to review the constitutionality of laws, adjudicate on disputes or conflicts between state institutions, dissolve political parties and resolve electoral disputes. The court also has the power to rule on allegations by the House that the president and/or vice president are guilty of treason, corruption, bribery, serious crimes or misconduct. The definitions of treason, serious crimes and misconduct are to be set out in the ancillary legislation. A hearing by the Constitutional Court must be attended by at least seven judges. Powers of Constitutional Court: 1. Law review Individuals, those representing a specific community, private and public institutions 2. Disputes between State institutions state institutions 3. Dissolution of The government a political party 4. Electoral disputes Individuals, legislative candidates, presidential and vice presidential candidates, political parties. 5. Impeachment The House (by Kurniawan Hari)

From http://www.thejakartapost.com/ 08/08/2003

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RI Establishes Constitutional Court

President Megawati Soekarnoputri installed on Saturday nine judges to the bench of the newly created Constitutional Court.In a ceremony attended by high-level officials at the State Palace, the nine judges, all prominent figures in the field of law, were sworn in by the President. The nine judges were nominated by the government, the House of Representatives and the Supreme Court. They are Achmad Syarifuddin, Mukti Fadjar, Haryono, Jimly Asshiddique, Achmad Rustandi, I Dewa Palguna, Laica Marzuki, Sudarsono and Muarar Siahaan. With the installment of the judges, the Constitutional Court officially takes over the judicial review authority from the Supreme Court. It is also ready to hear other cases dealing with the Constitution. "The public should have no doubt about us. We promise to be independent in settling cases between state institutions," Jimly said after the ceremony. The Constitutional Court was established officially several days after the President enacted the law on the court. The bill, which was deliberated by the House for one and half months, was endorsed by the House last week. The Constitutional Court is directed by the Constitution to conduct judicial reviews and settle cases where the president is considered to have violated the law. There are worries the political affiliations of the judges could influence the court's decisions, especially as regards cases involving the president. Jimly, who is affiliated with the Golkar Party, denied politics would color the court's decisions. Two judges, Haryono and Palguna, are affiliated with the Indonesian Democratic Party of Struggle (PDI Perjuangan), the largest party in the country, while Rustandi was proposed by the United Development Party (PPP). Jimly said the nine judges would hold their maiden meeting as soon as possible to elect a chief judge and to resolve any technical matters. "We will also have a meeting with the Supreme Court, which used to handle judicial reviews," he said. The Constitution required the country to have a Constitutional Court up and running before Aug. 17 this year. Laica Marzuki, one of three judges nominated by the Supreme Court, had been receiving treatment for respiratory problems at a Jakarta hospital. He left the hospital for several hours to attend the ceremony at the State Palace. A team of doctor and nurses were standing by during the ceremony, along with an oxygen tank, in case Laica fell ill. "We are so worried, he should not leave the hospital," one of the nurses said. The team took Laica back to the hospital as soon as the ceremony was over. Most of the Cabinet, House of Representative Speaker Akbar Tandjung and other official were among the attendees at the ceremony. (by Fabiola Desy Unidjaja)

From http://www.thejakartapost.com/ 08/17/2003

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Civil Servants Anxious Over Pay Cut Plan

The Cilacap legislative council in Central Java has asked the local administration to dock the salaries of civil servants by 5 percent, ostensibly to help rebuild a traditional wet market that burned down last week. The request was made by council speaker Fran Lukman, who chairs the Cilacap branch of the Indonesian Democratic Party of Struggle (PDI Perjuangan). Lukman was also allegedly behind the PDI Perjuangan's move to force civil servants, including teachers, as well as their students, to buy exercise books and T-shirts bearing party attributes. The move, apparently endorsed by the local administration, faced a serious challenge in the form of strong opposition from civil servants. Now, local civil servants are also up in arms over the possibility of the Cilacap administration docking their salaries by 5 percent to rebuild the market in Majenang subdistrict. "You can be sure the real reason is that many of the exercise books and T-shirts were returned. Now he (Lukman) is trying to dock our salaries," Yusmanto, 45, a teacher at Kroya state elementary school, said on Wednesday. Another teacher, Darmo, defended the protests by civil servants against the plan to force them to purchase the exercise books bearing pictures of PDI Perjuangan President Megawati Soekarnoputri and her father Sukarno, and the red T-shirts bearing a photo of Lukman. Red is the color of the PDI Perjuangan. "What we have done is right. Civil servants must be neutral in politics. It's not right that we should be forced to wear red T-shirts. That's why we rejected them," he said. "Now our pay will be docked by 5 percent. This is wrong. Civil servants are very badly paid. If our salaries are cut, how we can cover our expenses. Even without being cut, out salaries are never enough," Darmo added. He suggested that only the salaries of senior local officials and councillors should be docked. "I think it would be no problem for them as they are well paid." Lukman said he regretted the opposition of civil servants to the proposed cut. "I am extremely disappointed that many civil servants have rejected the proposal that their salaries be docked by 5 percent, even though the money will be donated to the victims of the Majenang market fire. They should not act like this as they have always received special treatment," he said. Lukman said that such special treatment included being given various allowances by the government, while other people, like traders, never received such privileges. "It was in this light of this that we proposed to the Cilacap regent that the salaries of civil servants be docked," he added. Lukman said the council would press ahead with the proposal, and submit it to the local administration despite the strong opposition from civil servants. He added ominously that those who opposed their salaries being cut would run the risk of having their "solidarity record" questioned, among other things. Cilacap Regent Probo Yulastoro has yet to respond to Lukman's proposal, which is still being discussed by the council. Slamet, a spokesman for the Cilacap administration, could not say whether Probo would accept the proposal or not. Lukman last week dismissed Probo as the PDI Perjuangan's Cilacap election campaign director because of the scandal over the T-shirts and the exercise books. The decision was taken to counter public allegations that the regent had abused his power for the benefit of the party, Lukman said. The dismissal came after Probo issued an order to all heads of local government agencies to prohibit civil servants and teachers from wearing T-shirts bearing party political symbols. Cilacap is one of the PDI Perjuangan's strongholds in Central Java. (by Agus Maryono)

From http://www.thejakartapost.com/ 08/21/2003

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MALAYSIA: Government Steps Up War Against Corruption

FOLLOWING reports earlier in the week that civil servants accounted for over half of the 1,352 people arrested for corruption between 1998 and 2000, Chief Secretary to the Government Tan Sri Samsudin Osman said it will go all out to wipe out the scourge. In its pursuit for a cleaner administration, he said the integrity management committee, formed in 1998, will be re-energised to ensure there are no weaknesses in existing laws and procedures, reported Berita Harian and Utusan Malaysia. Deputy Prime Minister Datuk Seri Abdullah Ahmad Badawi, in expressing his concern, said on Monday that the temptation of easy money was causing flaws in the public service and the situation has become alarming. He had suggested that one of the causes is the long time it takes for a service to be rendered due to complicated administrative procedures. Berita Harian said in its editorial that graft ?if not curbed or, better still wiped out ?not only jeopardises the future of the giver and the recipient, but also society and the nation as a whole. The daily said other than stepping up transparency and being more user friendly, the civil service needs to instil more religious values in the administration to combat bribery and corruption. Utusan Malaysia quoted Defence Minister Datuk Seri Najib Tun Razak as saying that there shall be no compromise in dealing with corrupt Mindef staff. The paper said the ministry, too, had seen its share of corrupt people, citing a recent disclosure by army commander Jen Datuk Wira Mohd Shahrom Nordin that there had been cases of cheating amounting to RM113mil, involving the building of training centres and army camps throughout the country. In its editorial, Utusan Malaysia said the public can expect the Anti-Corruption Agency to step up its war against graft from now, following the timely reminder by Abdullah.

From http://202.186.86.35/ 08/14/2003

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Faster CFs from October

KUALA LUMPUR: The Housing and Local Government Ministry will implement several measures to help speed up the issuance of certificates of fitness (CFs). Under the move, effective from October, developers will only have to obtain certification from one technical agency - the Sewerage Services Department - before their applications are approved, while certifications from other relevant agencies would be satisfied through other conditions. Currently, CF applications would only be approved with certifications from the Public Works Department, Fire and Rescue Department, Sewerage Services Department, Drainage and Irrigation Department, Tenaga Nasional Bhd, Department of Occupational Safety and Health, Telecommunications Department and Water Supply Department. Minister Datuk Seri Ong Ka Ting said the latest move would cut red tape, increase efficiency and avoid corruption, adding that the safety of buildings would not be "compromised". "For water and electricity certification, developers must have a Service Level Agreement with these agencies prior to embarking on projects," he said. To be certified by the Public Works Department and the Drainage and Irrigation Department, the engineers or architects submitting the documentation would only need to provide self-certification. "These professionals are licensed by their professional bodies and the Government will accept their certification. This way, these two departments will also not be involved in the final CF application process," he told reporters during the ministry's post-Cabinet press conference yesterday. He also said certifications from the Fire and Rescue Department and Department of Occupational Safety and Health would only be required for buildings above 18m or five storeys or higher. Ong said an earlier directive for CF applications to be approved within 14 days would remain, adding that if the authorities do not reply after two weeks of an application, it is automatically considered approved. (by Susan Tam)

From http://202.186.86.35/ 08/21/2003

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PHILIPPINES: Corpus Named Chief of AFP Civil Relations Service

The leadership of the Armed Forces of the Philippines (AFP) has appointed former military intelligence chief Brig. Gen. Victor Corpus as the new chief of the AFP Civil Relations Service (CRS) based at Camp Aguinaldo, Quezon City. Military sources said Defense Secretary Angelo Reyes and AFP chief of staff Gen. Narciso Abaya approved the appointment of Corpus, based on the recommendations by AFP senior officers. Corpus will replace Rear Admiral Edgardo Israel as chief of AFP-CRS. The turnover ceremonies will be held on Wednesday, the sources added. The controversial military officer, who once defected to the New People's Army (NPA) while he was a political science professor at the Philipppine Military Academy (PMA), was cited for his civil military projects that included a massive reforestation called "Greening of Panay' during his assignment to the 3rd Infantry Division on Panay Island. The AFP-CRS is the operating arm of the Office of the AFP Deputy Chief of Civil- Military Operations (CMO) involved in various military-community development programs in the country. A member of Philippine Military Academy (PMA) class 1967, Corpus tendered his irrevocable resignation last week as chief of the Intelligence Service of the AFP after mutinous soldiers belonging to the "Magdalo Group" demanded his resignation. The rebels also sought the resignation of Secretary Reyes and Philippine National Police (PNP) Director-General Hermogenes Ebdane Jr. The Magdalo Group also linked Corpus to the Sasa Wharf bombing in Davao City, but the military officer denied the allegation, saying that the baseless and unfounded accusation was just a "product of a sick mind." He had earlier expressed optimism that his resignation from ISAFP will eventually put an end to the unrest among some disgruntled junior officers who sympathize with the Magdalo Group. Corpus was also credited with the success of "Oplan Lambat Bitag," a comprehensive anti-insurgency campaign implemented by the government that drastically reduced the strength of the NPA from its all-time peak of 26,800 down to 5,600 during the term of then President Fidel Ramos. (by Aris R. Ilagan)

From http://www.mb.com.ph/ 08/03/2003

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Promoting Good Governance in the Philippines' Restructured Power Sector

The Asian Development Bank (ADB) has approved an US$800,000 technical assistance (TA) grant to strengthen the Philippines' Department of Energy (DOE) and promote good governance in the restructured power sector. The TA will help clarify the respective roles of the DOE and the newly established Energy Regulatory Commission (ERC) under the ongoing reorganization and build planning capacity in DOE's newly created unit, the Electric Power Industry Management Bureau (EPIMB). It will also draw up a five-year plan to promote public and private partnerships for the expansion of rural electrification in areas previously considered unviable. The centerpiece of the Philippines' restructuring of the power industry was the passage of the Electricity Power Industry Reform Act (EPIRA) in 2001. This established a new legal and regulatory framework for the power sector and enabled the unbundling of the industry into generation, transmission, distribution, and supply sectors. The regulatory function will be performed by ERC, while DOE will be responsible for the formulation of policies. The EPIMB will supervise the restructuring of the power sector with the aim of creating a competitive market and ensuring an efficient and reliable electricity supply. It will also draw up plans for rural electrification. "As the lead financing agency in the power sector in the Philippines, ADB will continue to review and monitor the privatization process and conduct regular policy dialogue with the Government," says Yongping Zhai, an ADB Senior Energy Specialist. "For the long-term, the goal of ADB's assistance is to ensure the quality, reliability, security, and affordability of electricity supply in the Philippines." ADB's role will mainly be to assist the Government in pursuing further reforms to promote good governance, which will ensure transparency, reliable supply, and reasonable electricity prices in a competitive market and will complement the expected entry of private sector players in the industry. To ensure transparency, the TA will take a participatory approach by consulting with target groups, communities, government agencies, stakeholders, and nongovernment organizations. Partnerships will also be established with foreign counterparts, which have had success in power sector restructuring and in developing competitive markets. The total cost of the TA is $1.15 million, of which the Government will contribute $350,000 equivalent. Work will be carried out over 12 months to September 2004.

From http://www.adb.org/ 08/11/2003

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Anti-corruption Task Forces in AFP Formed by Arroyo

President Gloria Macapagal Arroyo yesterday announced the creation of two special task forces to implement anti-corruption reforms in the Armed Forces following the July 27 failed rebellion against her administration. Speaking at the 40th anniversary of the National Defense College of the Philippines (NDCP) in Camp Aguinaldo, Quezon City, the President vowed wide-ranging reforms to rid the military and Defense department of corruption, as claimed by the rebel soldiers who staged the mutiny last month. The first task force, to be headed by newly appointed Defense Undersecretary Constancia de Guzman, will help overhaul the military's procurement and fund disbursement system, Arroyo said. The other is an anti-corruption body that would undertake comprehensive lifestyle checks on military and Defense department officials. "We have seen a misadventure in counter-reform. We shall answer it with more reform. We have seen an exercise in political illegitimacy. We shall answer it with the greater force of the Constitution and the law," she said. Mrs. Arroyo gave the first task force, to be composed of officials from the Department of Budget and Management and Commission on Audit, two months to implement the reforms in the military bidding and audit system. In this regard, she assigned Armed Forces chief of staff Gen. Narciso Abaya to disburse cash field units, taking away the power of military "comptrollers. "The anti-corruption task force, on the other hand, will investigate complaints of corruption among the military ranks and conduct "comprehensive lifestyle checks" in the military in coordination with the Presidential Anti-Graft Commission, Arroyo said. She has yet to name the head of the anti-corruption task force. Arroyo already cited Defense Secretary Angelo Reyes, who has been accused of corruption by the rebel soliders, for submitting himself to the lifestyle check. The immediate concern of the task force is to make recommendations for eviction of officers "occupying AFP residences past the regulations," she said. The President is set to issue executive orders to institutionalize the two task forces into a separate office tasked to review AFP procurement and fund disbursements and the other an internal affairs office within the military. In a bid to remove the scourge of military adventurism, the President also ordered the Defense department to "institutionalize a course" on the dangers of coups, to be taught in all military schools. She said she expects the NDCP to take the lead in drafting the course plan for this. Also, Arroyo said the government must institutionalize the sense of accountability among military commanders to "help deter future coup attempts." "The respective commanders of the coup participants should be made to feel accountability for the actions of the participants under their command," she said. She noted the commander of the Navy's Special Warfare Group, Rosauro Sarmiento, whose officers joined the mutiny, has resigned from his post "because he had committed to me the day before the coup that if even one of his men would join it, he would resign. "Brig. Gen. Victor Corpus, the head of the military intelligence command, had quit earlier to ease what he described as continued restiveness in the military. But the President emphasized that Corpus "was not the only fallout of the coup. "The President, meantime, encouraged all junior military officers "with knowledge of such activities to bring evidence before the Department of Justice." Arroyo assured the soldiers who give information to the probe body "shall be protected in your fight for the truth. There will be no whitewash or looking the other way." "If there is evidence, there will be prosecution. If guilt is proven, people will go to jail, whatever the rank or command," she added. "All allegations of corruption in the Armed Forces shall be investigated expeditiously and thoroughly," she said. Two Marine captains have already come forward with information on the sale of assorted military ammunition to the enemies of the state, bolstering earlier claims made by mutinous soldiers. Presidential spokesman Ignacio Bunye immediately assured there will be no overlapping functions of the new task forces since "the operations of the bodies are quite specific." He said the President is already scouting for the members of another independent commission to look into the accusation of the rebel soldiers that Defense officials orchestrated the bombings in Davao City early this year to get more US military aid to finance the local anti-terror campaign. In a related development, the President awarded presidential citation to the police and military in recognition of protecting the republic and steadfast loyalty during the July 27 coup. The mutinous soldiers had claimed they had evidence to prove that top defense officials were engaged in the sale of equipment to the rebels while money to be spent on soldiers' equipment was siphoned off by generals. The President lifted on Monday the "state of rebellion" she invoked to quell the military uprising, saying that the threat has abated even as several conspirators remained at large. The government said the failed plot had called for the rebels to assassinate the President and set-up a 15-man junta to be led by opposition Sen. Gregorio Honasan, who has gone into hiding. (GDK) 'Conversion' scheme President Arroyo has directed the Department of National Defense (DND) to initiate the restructuring of the cash disbursement system of the Armed Forces of the Philippines (AFP) in order to eliminate the anomalous "conversion" schemes in financial transactions involving military field units that was among the major issues raised during the failed military rebellion in Makati City. In her speech at the 40th anniversary celebration of the National Defense College of the Philippines (NDCP) in Camp Aguinaldo, Quezon City, Mrs. Arroyo said: "The heart of the structural problem seems to be the power that AFP comptrollers have accumulated over the years such that comptrollers actually themselves disburse 'converted' cash to field officers, :In view of the loopholes in the disbursement process, Mrs. Arroyo directed AFP chief Gen. Narciso Abaya to assume "sole authority" in the disbursement of cash reserves as a preventive measure against anomalous transactions. The illegal cash conversion scheme in the AFP was among the issues raised by the "Magdalo" rebel group led by Lt. Senior Grade Antonio Trillanes IV as a major source of ill-gotten wealth in the military. On the same occasion, Arroyo, the AFP commander-in-chief, gave Presidential Citation Awards to the leaderships of the AFP and the PNP for their steadfast loyalty to the Constitution during the height of the Magdalo rebellion in Makati City last July 27.Abaya received the award for the AFP while Razon represented PNP chief Director General Hermogenes Ebdane Jr. in receiving the award on behalf of the police organization. (by Genalyn Kabiling & Aris Ilagan)

From http://www.mb.com.ph/ 08/12/2003

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SINGAPORE: Prime Minister to Resign

Prime Minister Goh Chok Tong said today that he would step down when the economy recovered from a downturn caused by the SARS outbreak and named as his successor the eldest son of Lee Kuan Yew, Singapore's founding premier. Mr. Lee's son, Lee Hsien Loong, is currently deputy prime minister, finance minister and the chairman of the central bank. Mr. Goh said he wanted to give his successor "at least two years to establish himself as prime minister before he fights the next general election." "But I am not stepping down yet," he said. "My immediate priority is to get Singapore out of the economic gloom." Mr. Goh made the comments in an annual speech to the nation known as the National Day rally. Singapore has been rocked by two recessions since the Asian financial crisis in 1997 and 1998, and was hit this year by SARS, or severe acute respiratory syndrome, which led to the sharpest economic contraction on record in the second quarter. About 33 people in Singapore died from SARS, which killed more than 800 worldwide. The illness also hit the economy hard, with the service sector worst hit as tourists stayed away and local people stayed home. The economy contracted in the second quarter of 2003 against the first quarter at a seasonally adjusted and annualized rate of 11.4 percent. Mr. Goh said during the last general election in November 2001 that he would step down before the end of the current five-year term. A cabinet reshuffle, which took effect this month, and signs of recovery after the SARS outbreak have fueled talk that Mr. Goh - who is 62 and has been prime minister since November 1990 - might be nearing the end of his stay at the top. Mr. Goh said he picked Lee Hsien Loong, 51, after consulting with ministers and members of Parliament. But he said he knew some Singaporeans were uncomfortable with Lee Hsien Loong's leadership style. "Loong's public persona is that of a no-nonsense, uncompromising and tough minister," he said. "Singaporeans would like Loong to be more approachable." (by Reuters)

From http://www.nytimes.com/ 08/17/2003

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THAILAND: `On Way to One-Party Govt'

The Thai Rak Thai party's growing political supremacy will bring about a big change in the Thai political landscape as other parties' politicians will be forced into local politics or call it a day, social critic Chai-anan Samudavanija predicted yesterday. In a speech given at Thammasat University as part of the 30th anniversary celebrations of the Oct 14, 1973 student uprising, Mr Chai-anan said the rise of Thai Rak Thai meant the fall of other parties. If Thai Rak Thai won 400 House seats in the next general election and formed a single-party government, the Democrat, Chart Thai and Chart Pattana parties would have no choice but to find success at local-level elections. ``They will become local-level political parties,'' he said. Businessmen and academics in the Democrat party would quit politics, leaving only the party's ``career politicians'' to try to re-capture their past glory among grassroots and provincial communities. Chart Thai and Chart Pattana, at the same time, might head towards municipal poll contests. Mr Chai-anan said capital sources for politics that came from corruption and bankers were depleting because of the economic situation and the reduction in the number of mega-projects. Financial support now came from shares in technology companies and illegal businesses such as drugs, gambling, brothels and underground lottery. ``There is no surprise why the government tries to attack those illicit businesses as they are still sources of money for its political rivals,'' he said. The academic, who was part of the pro-democracy movement 30 years ago, predicted Thailand would likely have a one-party government soon. However, a single-party government tended to serve one particular group of people and that might not sit well with Thailand's social structure consisting of four population bases _ the underprivileged, the middle-class, the rich and highly-educated and the business competitors. A coalition government with only a few parties should be ``a better formula'', he said. Mr Chai-anan, also a former Constitution Court judge, said he was not surprised at remarks that Thailand was being guided by only one leader, adding that that was a global trend. It was the personality of the leader of the party, not the party itself, that counted when it came to national leadership, he said. ``The national leader must now be daring, capable and fast because he has to deal with regional problems. He must be able to challenge the world. He must know when to bend and when to break,'' Mr Chai-anan said. However, it was more difficult now than three decades ago to tell if government leaders were ``tyrants'', he said. ``Until now, I still cannot tell what this government is really like,'' he said. Thamrongsak Phetlert-anan, of Rangsit University, said society was being covered with ``silence'' as academics and activists who fought for democracy and freedom of expression 30 years ago had already defected to the government. ``They have surrendered to money,'' Mr Thamrongsak said.

From http://www.bangkokpost.net/ 08/10/2003

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Govt Committed to Saving Forests

The government is fully committed to fighting deforestation, in line with the Royal initiative of Her Majesty the Queen, Prime Minister Thaksin Shinawatra said yesterday. In Her Majesty's birthday speech on Monday, the queen expressed concern about the unchecked destruction of forest areas. Thaksin offered assurances that his government was on track in its efforts to promote forest conservation and reforestation. "I believe land reform is the key to ending forest encroachment. Landless farmers will stop denuding the forests if they have their own land," he said. Speaking in reference to Her Majesty's vision of Thailand as a world food bank, the prime minister said preparations are underway to promote the country as a leading food supplier. In a related development, Natural Resources and Environment Minister Prapat Panyachatraksa convened an urgent meeting aimed at mapping out a series of forest conservation measures. "The ministry will strictly regulate watershed areas," Prapat said, adding that mountain farmers would be banned from using certain agricultural chemicals that could contaminate watersheds. He said farming on mountains would be supervised as a preventive measure against possible land erosion. "Mountain farmers will be encouraged to cultivate environmentally friendly crops, such as rattan and bamboo," the environment minister said. In reference to the problem of deforestation, Prapat said the ministry was implementing a number of projects whose aim was to rehabilitate denuded forests nationwide. Turning his attention to conservation of the marine environment, the minister said he was coordinating with relevant agencies to speed up the construction of artificial reefs in the Gulf of Thailand. "Complying with Her Majesty's birthday wishes, officials at the Natural Resources and Environment Ministry pledge to make their best efforts to conserve the environment," he said. Plodprasop Suraswadi, the permanent secretary to the Natural Resources and Environment Ministry, said Thailand's hilltribe people should be allocated five-rai farm plots per family to discourage further deforestation. "Each tribal community will manage a designated area of public land as a food bank for all residents, while families will be banned from farming beyond the allocated land," the permanent secretary said.

From http://www.nationmultimedia.com/ 08/13/2003

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Education Reform: Lacklustre Report Card

Official evaluation finds regulations still being drafted, decentralisation of services incomplete. While some progress has been made, education reform still has several major problems to tackle four years after the process began, an official evaluation showed yesterday. The secretary-general of the Education Council, Rung Kaewdaeng, said educational inequality persisted, as higher-educational institutes and vocational colleges were mainly located in urban areas. "This has adversely affected the educational opportunities for rural children," he said. The evaluation also found that families and other social institutions were not allowed to actively take part in educational services because relevant educational regulations had yet to take effect. Rung said authorities were still reviewing the drafts of the regulations and that the transfer of educational services from central agencies to local administrative bodies remained incomplete. On academic performance, Rung said that sixth-graders failed to perform up to standard in maths, science and Thai and English language. Ninth-graders, he said, were also poor at languages, arithmetic and analytical thinking. "Their substandard performances have reflected something about teachers, teaching equipment and education management," Rung said. According to the evaluation, some teachers lacked confidence in the educational curriculum and were still unable to adopt child-centred teaching methods. Rung said educational management was also marred by problems such as a high dropout rate, an inefficient budget and red tape. "Graduates from colleges and universities do not fulfil the country's demands," he said. However, he said the education reform process had achieved some progresses in all 80 items being evaluated. Of the 80 items, 30 per cent had made outstanding progresses, 50 per cent intermediate progress and 20 per cent little progress. Despite lingering problems, Rung said he believed that the reform process would deliver concrete results within the next two years.

From http://www.nationmultimedia.com/ 08/15/2003

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Government Urged to Shun New Pacts

The government should not rush into new issues at the World Trade Organisation talks in Cancun, Mexico, in September, an NGO network said yesterday. Four new issues on the ministerial meeting agenda address liberalisation in investment, transparency in government procurement, competition policy and trade facilitation. They were initially raised at the first ministerial meeting in Singapore amid opposition from developing countries. ``Agreeing to the new deals would merely be adding to the burden for Thailand, which has always lost out in WTO negotiations,'' said Jacques-chai Chomthomgdi, of Focus on the Global South, one of the 12 groups which gathered yesterday. These new issues would benefit only developed countries. Liberalising the investment sector to lessen restrictions for international firms would hurt Thailand's small and medium enterprises. Although the government was reserved on the issues of investment and procurement, the recent impulse to free trade was an indication the government might agree to the deal at the Sept 10-14 meeting, he said. The activist groups also called on the government to review the impact of previous Thai-WTO agreements before leaping into any new pacts. Pongthip Samranchit, of the Alternative Agriculture Network, said the liberalisation of agriculture eight years ago had hurt Thai farmers, who suffered from cheap produce dumped on Thai markets. Trade value of agricultural produces may have increased, but the amount of produce flowing in from abroad also increased, especially potatoes, onions and soybeans, she said. ``And there is nothing the government could do to stop it because of the liberalisation agreement with the WTO.'' The government, with its world's kitchen policy, was likely to push for more markets for Thai produce and further liberalise the agriculture sector in exchange. If the government did not come up with measures to prevent the dumping in agricultural produce, Thailand would lose out in the trading of many more items. These included powdered milk, coconuts, coffee, instant coffee, tea, soybean oil, sugar and tobacco. The network urged the government to incorporate these warnings into their negotiation agendas and not leave the NGOs out of preparations for the next meeting.

From http://www.bangkokpost.net/ 08/15/2003

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VIET NAM: Govt Wage Reforms Aim to Boost Minimum,Incentives

Under its continuing wage reform, the Government will periodically increase minimum wages for its employees while permitting incentives to certain categories of workers, a legislative committee official said last week. Speaking at a forum titled Enterprises' View on Salary Reform in Ha Noi, deputy director of the National Assembly's Social Affairs Committee, Dang Nhu Loi, said the extra allowances were meant to encourage experts and skilled workers to serve in remote areas. However, small - and medium-sized enterprises (SMEs) and foreign firms will be allowed to decide wage levels for their workers as long as they are higher than the minimum rate set for Government employees. "The salary programme will contain two separate parts: one for public services and the other for administrative offices," Loi added. Under the plan, the number of salary scales at State-owned enterprises (SOEs) will be reduced from 21 to six. The enterprises will have the discretion to pay additional allowances for employees working under hazardous conditions. The current minimum monthly wage for employees in SOEs and SMEs is VND290,000 (US$18) while at foreign-invested companies it is VND417,000-626,000 ($26-41) depending on the area of operation. However, this system came in for criticism from the director of the Ministry of Finance's Financial Policy Department, Quach Duc Phap. Speaking at the meeting, he said, "the present wage mechanism is not flexible. "For instance, it does not distinguish between basic salary based on profits and from the exchequer." Though almost all the delegates, representing corporations and enterprises, agreed with the wage reform draft, some did differ with its provisions. A Construction Consultant Association representative said that the stipulation of a minimum wage in the draft would cause problems to some enterprises. "It is not easy for some to pay even the minimum salary to their workers, especially SMEs operating in remote areas," he pointed out. Several delegates proposed that the Government should include allowances for employees posted in hazardous workplaces - like miners and chemical researchers - in the draft. Loi revealed that the Government would submit the draft to the National Assembly for approval by the end of this year. (by Ngoc Thuy)

From http://vietnamnews.vnagency.com.vn/ 08/01/2003

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MoT Plans Big Spend for Exports

The Ministry of Trade (MoT) plans to pump nearly VND300 billion (US$19.5 million) into the development of trade-boosting infrastructure facilities as part of its efforts to increase the country's exports. The infrastructure developments are part of the Ministry of Trade's strategy to achieve commodity exports of $21 billion in 2004, up 8.8 per cent from this year's target. The MoT plans to construct three separate farm produce markets in the provinces of Dac Lac, Can Tho and Nghe An. These will be funded using around VND50 billion ($3.3 million) in investment capital provided by the State budget. Around VND133 billion ($8.8 million) will be invested in other infrastructure, including the construction of three international-standard conferences, fair and exhibition centres, in the cities of Ha Noi and Da Nang, and in the southern province of Dong Nai. Some of these funds will also be used for an e-commerce development and application project. These projects are scheduled for completion next year. The MoT's commercial development programme will also undertake the construction of provincial-level farm produce wholesale markets in around 20 provinces throughout the country. Three international trade centres, in the United States, Russia and Dubai (United Arab Emirates), will also be constructed, ready to begin operation in 2004. The total investment in these centres is VND48 billion ($3 million). The MoT's optimistic target of $21 billion in export revenue is based on achieving high revenue growth from the export of three major commodity groups. The target for exports of agricultural, forestry and marine products is around $6.5 billion, up 5 per cent over this year's figure. The light industry and handicraft sectors are expected to achieve total exports of $8.61 billion, an increase of 14 per cent. Exports of heavy industry and minerals are expected to increase by five per cent to $5.88 billion. According to the MoT's forecasts, combined exports for the remainder of the year will amount to $8 billion, with the figure for the whole year up by 15.2 per cent over 2002 to $19.5 billion. For the remainder of the year, the MoT has forecast the export of: 1.2 million tonnes of rice, bringing the whole year's estimated exports to 3.8-3.9 million tonnes; seafood worth $1.1 billion (whole year estimate: $2.2-2.3 billion); 260,000 tonnes of coffee (whole year estimate: 650,000 tonnes); garments and textiles worth $1.15 billion (whole year estimate: $3.3 billion); electronics worth $230 million (whole year estimate: $600 million); and, footwear worth $750 million (whole year estimate: $2.1 billion). Around 7 million more tonnes of crude oil is expected to be exported during the remainder of the year. Import turnover for the next five months is estimated at $10 billion. Imports for the whole year are estimated at US$24 billion, up 21.6 per cent over last year. During the January-July period, exports increased by 27.9 per cent year-on-year, to reach more than $11.4 billion, while imports soared by 34.4 per cent to over $14 billion. The trade deficit is for the first seven months of the year is equivalent to 23.6 per cent of the export revenue, 3.6 per cent higher than the year's trade deficit target of less than 20 per cent of exports.

From http://vietnamnews.vnagency.com.vn/ 08/11/2003

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INDIA: Even Bihar's Ministers Go Without Salaries

After thousands of state government employees, it is now the turn of Bihar's ministers, with the notable exception of Chief Minister Rabri Devi, to go without their salaries in this funds-starved state. State government officials said state as well as Cabinet ministers had not got their salaries for July because of a funds crunch. Health Minister Shakuni Choudhary, however, said: "The delay in paying salaries occurred because the department concerned did not clear the bills for payment." The state finance department treated Rabri Devi's salary as a "special case" but the same privilege was not accorded to the 30 ministers of state and 30 Cabinet ministers. In Bihar a Cabinet minister's salary, including allowances, is Rs 25,000 while a minister of state gets Rs 24,000. Sources in the finance department said funds for paying salaries were to be made available to the department by the first week of August but this was not done because of a shortage of money and "other problems". This is not the first time government employees in Bihar are going without pay. Thousands of employees of state-owned bodies in Bihar were not given their salaries for the past 10 years. Employees of departments like health, education and irrigation have also been getting irregular salaries for several years. This year the Supreme Court directed the state government to pay salaries to 22,000 families linked to employees of 19 government-owned bodies. The state government then deposited two instalments of Rs 250 million with the Patna High Court towards the payment of salaries to its employees.

From http://www.hindustantimes.com/ 08/09/2003

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President's Awards for CBI Officials

NEW DELHI: Altogether 13 CBI officials have been decorated by the President for their distinguished services this year. While two - joint director K P Prabhakar Rao and SP Akhileshwar Prasad - bagged the President's police medal, 11 others got the police medal for the meritorious services from the President. Among them are: DIG Sudhir Saxena, DSP S R Majumdar, DSP D N Biswas, ACB M S Hazari and Inspector Rajinder Singh.

From http://timesofindia.indiatimes.com/ 08/18/2003

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Law Commission Wanted Change in No-Confidence Rule

NEW DELHI: Deputy Prime Minister L K Advani's suggestion during his speech on the no-confidence motion that the Opposition should have named the alternate Prime Minister stems from the Law Commission's recommendation that vote of no-confidence should not be admitted unless it is accompanied by a motion expressing confidence in a named individual. Borrowed from the German system, the Law Commission had recommended the new system in the aftermath of the fall of Vajpayee government by one vote in 1999 in its report on reforming the electoral laws. The commission feels that the change does not even entail constitutional amendment. Addition of rule 198A in the Rules of Procedure and Conduct of Business in the Lok Sabha would do. The Law Commission had also recommended that once a no-confidence is taken up for discussion and voted upon, no fresh motion expressing want of confidence in the council of ministers shall be permitted for two years from the date of voting of such motion. Advani's other idea of synchronising parliamentary and assembly elections was also suggested by the commission in the same report. The latest no-confidence motion has set the Commission thinking again. Says member N M Ghatate: "There are three advantages of adopting no-confidence along with confidence motion. One, the country would have a PM who commands majority in the house. Last time, when Vajpayee lost by one vote, he was a lame duck PM for six months," he says. Second, the President would never get dragged into the vortex of politics. How? "In coalition politics when no party wins a majority, the President uses discretion in chosing a man who will lead the government. But if he is not sure of the choice and gets criticism. It happened when Neelam Sanjeeva Reddy chose Charan Singh after Morarji Desai's government fell and Shankar Dayal Sharma decided on Vajpyee in 1996," he explains. Third, the Parliament would continue for five years. What if house does not have confidence in any other leader? Says Ghatate: "The German system is the best. In case the House cannot elect a leader, the President has the power to dissolve the House. This threat helps them to elect a leader. This can be done here also." Though Ghatate denies that the Law Commission's idea was borne out of the Vajpayee government's 1999 experience, he maintains that it is not undemocratic and unconstitutional. "The Parliament would continue for five years but the government can still change and a new PM can be elected. Even the Supreme Court in the Bommai case said the best way to choose a PM is the floor test. How is it undemocratic? Our Constitution says that the term of the Parliament is for five years," Ghatate says, and gives the instance of the Rajasthan Municipality law which stipulates that once a mayor is elected, a no-confidence motion cannot be brought for two years. Hopeful that one day the government would accept the Law Commission's recommendation on a no-confidence motion, Ghatate says other recommendations like auditing of party accounts, ceiling on expenditure and regular elections have been accepted.

From http://timesofindia.indiatimes.com/ 08/19/2003

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New AIPJD State Chief to Be Named Soon

BANGALORE: The new state chief of the All India Janata Progressive Dal will be named soon, AIPJD legislature party leader B. Somashekar said on Tuesday. The post fell vacant after the sudden demise of C Byre Gowda. Speaking to reporters here, he stated that AIPJD President S R Bommai will hold talks with Ramakrishna Hegde in connection with the selection of a consensus candidate. Though AIPJD Political Affairs Committee Chairman M P Prakash and party spokesperson Ramesh Kumar are the contenders for the post, Somashekar declined to comment on the candidates. "It is left to Bommai to select a suitable person," he added. The AIPJD leaders will meet on Wednesday to discuss the matter.

From http://timesofindia.indiatimes.com/ 08/19/2003

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SRI LANKA: Appointment to Public Utilities Commission

Vice President of the Institution of Engineers, Sri Lanka, Eng. D. B. J. Ranatunga has been appointed by Prime Minister Ranil Wickremesinghe with the concurrence of the Constitutional Council as a member of the Public Utilities Commission in terms of Section 3(1) of the Public Utilities Commission Act, No. 38 of 2002. Eng. Ranatunga is one of the select few who won an exemption from the first year in the University on his superior performance at the GCE 'A' level, enabling him to enter directly to the second year of the Faculty of Engineering of the University of Ceylon in 1965. After completing his first degree with honours, he won a Colombo Plan Scholarship to the University of New South Wales, Australia, for his Masters' Degree in Engineering. He also obtained a Masters' Degree in Business Administration from the Post Graduate Institute of Management of the University of Sri Jayawardanepura. He is a Chartered Engineer, Fellow and a Vice President of the Institution of Engineers, Sri Lanka. His professional career includes Chief Engineer, National Textile Corporation, Production Manager, State Engineering Corp., Principal Research Engineer and General Manager, National Engineering Research and Development Centre, General Manager and Chairman, State Mining and Mineral Development Corp., Managing Director, Serendib Coconut Products Ltd; CEO, Delmege Forsyth & Co. (Paints) Ltd, and CEO, Dankotuwa Porcelain Ltd. He has served as a Director, Ceylon Oxygen Co., Board Member of the Ceylon Electricity Board, President, Energy Managers' Association of SL, Vice President, SL Association for Quality, Officer in SL Army Volunteers, member Presidential Task Force on Energy and President of Peradeniya Engineering Faculty Alumni Association. He is a visiting lecturer at the Moratuwa University for Engineering under the Graduate Programme and MBA course, and a member of the Mineral Resources Committee of the National Science Foundation.

From http://www.dailynews.lk/ 07/30/2003

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SRI LANKA: Govt. Will Free Public Service from Political Interference - G.L.

The Government has embarked on a policy to free the public sector from political interference by re-introducing certain features of the Soulbury Constitution where no political authority wielded power over the public service, Constitutional Affairs Minister Prof. G.L. Peiris said yesterday. Prof. Peiris said that the time has come to create a "Whistle Blowing Public Sector" where the public officers should be in position to "blow the whistle" whenever there is corruption within the sector. Speaking at a workshop held at the BMICH on Constitutional Provisions relating to the Public Officers, the Minister said political influence which has continued to dominate the public sector from the time the legislature in 1972 introduced an amendment to the Interpretation Ordinance resulted in the questionability of the decisions made by public officers exercising administrative authority being limited to certain identifiable grounds. Although with due respect to the then Constitutional Minister Dr. Colvin R. de Silva, it was admitted by the previous and present Governments that a profound error was made by him while drafting the amendment which demotivated the public officers, limiting their creativity in taking important decisions. The Government will also take measures to put in motion the Police, Public Service and Bribery Commissions set up under the 17th Amendment and this was a crucial time for it. "The record amount of money received by Sri Lanka from the donor countries at the Tokyo donor conference has surfaced the issue that these commissions, especially the Public Service Commission should be functioning to ensure the maximum utilisation of the funds received," Professor said. Meanwhile, Prof. Peiris revealed that the Government working on to bring the Bribery Commission into life is currently facing difficulties in filling a vacant position in the three member committee. (by Asanga Warnakulasuriya)

From http://www.dailynews.lk/ 07/30/2003

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NEPAL: Govt. Forms Inquiry Commission

Government formed an inquiry commission under Patan Appellate court judge Madav Lal Shrestha to inquire into the circumstances leading to the abduction and murder of Amar Lama Sunday, an official announcement said. The one-man judicial commission will submit its report to the government in 15 days. Government acted within 24 hours of the crime to investigate the murder. Nobody has been arrested so far for the murder; a driver of a taxi used by the murderers surrendered to police Monday. The drive confessed he surrendered after learning of the news of the murder through the media. The murder could have political repercussions prompting the government to act quickly.

From http://www.nepalnews.com/ 07/28/2003

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Bribery Charge Against Govt. Official

The Commission for Investigation of Abuse of Authority Wednesday filed a corruption case at the Special Court against Pradip Adhikari, a section officer at the Office of the Company Registrar. According to CIAA officials, Adhikari was caught red-handed asking for bribes to register a school as a company. CIAA has demanded fines and a one-month jail sentence for Adhikari.

From http://www.nepalnews.com/ 08/06/2003

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PAKISTAN: Appointment of Governor President's Privilege

QUETTA: Chief Minister Balochistan Jam Muhammad Yousuf has said that he has been kept in the loop with regards to the appointment of the new governor of Balochistan. Talking to a group of newsmen at his office here on Saturday he was reluctant to disclose the name of the would-be governor. The chief minister said that under the Constitution it was the president's prerogative to appoint the governor, adding that he was taken into confidence regarding nomination of the new governor. Mr Yousuf said that every citizen could wish for choosing a person of his or her own liking; however, under the Constitution it was the president's prerogative. Replying to another question on the federal government's intention to launch a military operation in the province, the chief minister said the federal government was only interested in launching development projects. Mr Yousuf said that the government would tackle saboteurs, dacoits, and anti-social forces with all its might to protect life and property of the citizens. About the chelum procession of July 4 martyrs the chief minister said that the government had taken all precautionary measures to maintain law and order and no one would be allowed to take law into their hands. He said that police had arrested the main accused involved in terrorist attacks of June 8 and July 4 in Quetta. However, he added, two leading terrorist Saifullah Kurd and Daud Badani were still at large. Replying to another question on new award of the National Finance Commission (NFC), he said that Balochistan ministers would be attending the meeting in Islamabad in the next couple of days.

From http://www.dawn.com/ 08/10/2003

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Owais Ghani Nominated Governor

ISLAMABAD: Mr Owais Ahmed Ghani has been nominated as governor of Balochistan, it was officially announced here on Saturday. The governor-designate is expected to take oath on Monday. Earlier, Mr Ghani called on President Gen Pervez Musharraf and discussed with him matters relating to his new assignment. He said that he would strive to live up to the trust reposed in him, and work for the socio-economic uplift of the people of Balochistan. The president congratulated Mr Awais Ahmed Ghani and wished him success in his assignment. The governor-designate thanked the president for his kind sentiments.-APP

From http://www.dawn.com/ 08/10/2003

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Sindh Govt. Sets Up Investment Board

KARACHI, Pakistan: (PNS) - Sindh Government has decided to Establish the Sindh Investment Board in view of possibility and vast opportunities of investment in Sindh. Sindh Chief Minister Sardar Ali Mohammed Mahar said here Tuesday that the proposed Board will provide guidance of potential investors and ensure provision of maximum facilities to them. The Sindh Finance Minister Syed Sardar Ahmed Tuesday held a meeting with the Chief Minister and discussed various issues and matters with him. It was observed that investors from various countries are keen to invest here in the housing, education, science, mineral development and transport sectors.

From http://www.paknews.com/ 08/13/2003

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Govt Is Trying to Strengthen the LG System: PM

ISLAMABAD, Pakistan (PNS) - Prime Minister Mir Zafarullah Khan Jamali has said that the government is trying to strengthen the local government system in order to bring about a real change at the grassroots level. He said this while talking to the district nazim of Rawalpindi Raja Tariq Kiani who called on him in Islamabad yesterday. The district nazim briefed the prime minister about the development projects in Rawalpindi district.

From http://www.paknews.com/ 08/17/2003

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Ministerial Body Formed

KARACHI: A high-level meeting here on Saturday constituted a ministerial committee, headed by Chief Minister Ali Mohammad Mahar, for assessing the extent of pollution and damage caused by the oil slick to human resource, marine life and environment in coastal areas. Provincial Minister for Fisheries Sardar Manzoor Ali Khan Panhwar presided over the meeting which reviewed the after-effects of oil spill from a Greek oil tanker Tasman Spirit near Karachi harbour. Minister for Inter-Provincial Coordination Nadir Akmal Khan Leghari, Adviser to the CM on Environment and Alternative Energy Faisal Malik Gabol, secretaries of the IPC Department and Livestock & Fisheries, and other senior officials attended the meeting. Mr Panhwar, Mr Leghari and Mr Gabol are members of the committee. It was also decided to constitute a technical committee to assist the ministerial committee in the assessment process. Speaking on the occasion, Mr Panhwar urged the government to take concrete measures on emergency basis to minimize the damage being caused to marine life and beaches. Mr Leghari said that the committee would approach the federal government to seek assistance and funds to contain the oil slick and remedial measures. He urged the Centre to help combat the environmental disaster on emergency basis. Mr Malik told the meeting that the Environmental Protection Agency (EPA) had been monitoring the affected area along the beaches to assess the damage on day-to-day basis. The meeting also urged NGOs to play their due role in creating awareness in people and provide technical support to overcome the problem. -APP

From http://www.dawn.com/ 08/17/2003

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AZERBAIJAN: President's Son Appointed Premier

Meeting in emergency session on 4 August, the Azerbaijani parliament voted by 102 to one to confirm Ilham Aliev as prime minister, Turan reported. Opposition deputies abstained from voting, Reuters reported. Ilham's candidacy was proposed by his 80-year-old father, incumbent President Heidar Aliev, who remains hospitalized in Turkey. Ilham Aliev, who is a parliament deputy and deputy chairman of the ruling Yeni Azerbaycan Party, resigned the same day from his positions as first deputy president of the state oil company SOCAR and as head of Azerbaijan's delegation to the Parliamentary Assembly of the Council of Europe. Ilham Aliev was born in Baku in December 1961 and graduated from the Moscow State Institute of International Relations (MGIMO). He went into business in Turkey in 1992, returning to Azerbaijan in late 1993 after his father was elected president. Under amendments to the Azerbaijani Constitution approved in August 2002, as prime minister he would become acting president should his father die or prove unable to discharge his duties. In an interview published in "Izvestiya" on 25 April 2002, Ilham Aliev characterized himself as hardworking and a pragmatist. "Zerkalo" in April 2000 described Ilham Aliev as very intelligent, but lacking ruthlessness and not a natural-born leader.

From http://www.rferl.org/ 08/04/2003

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Ilham Aliyev's Appointment as Azerbaijan's PM Sets Stage for Dynastic Transition

Azerbaijan's parliament on August 4 approved the appointment of ailing President Heidar Aliyev's son, Ilham, as prime minister. The move, denounced by an opposition leader as a "usurpation of power," clears the way for a dynastic-style transfer of power in the oil-rich Caucasus nation. Ilham's appointment sends the clearest signal yet that the elder Aliyev's tenure as Azerbaijan's paramount political leader is coming to an end. Heidar Aliyev has been hospitalized at a Turkish military facility since early July and is reported to be terminally ill. [For background see the Eurasia Insight archive]. Under a constitutional amendment approved during a summer 2002 referendum, Azerbaijan's prime minister becomes the interim president in the event of that the incumbent chief executive either dies in office or is incapacitated. Ilham and Heidar Aliyev are also the ruling New Azerbaijan Party's candidates in presidential elections, now scheduled for October 15. After limited debate, parliament approved Ilham Aliyev's as prime minister by a 101-1 vote. Opposition MPs in the 125-seat legislature boycotted the vote. The outgoing prime minister, Artur Rasizade, did not immediately provide a reason for his sudden resignation, although he later reportedly based his decision on "health reasons." Isa Gambar, head of the Musavat Party, characterized the move as "a usurpation of power" and said opposition forces would strive to counteract the ruling party's political maneuvers. "This is an attempt to play out a neo-monarchist scenario in Azerbaijan," Gambar said in a television interview. [For additional information see the accompanying EurasiaNet Q&A]. Speaking on state television after his elevation, Ilham praised his father's policies as "brilliant traditions," adding that his chief goal would be to maintain stability. "The aim of us all is to make Azerbaijan a strong and economically powerful country," Ilham said. "I am not in favor of any abrupt actions and think that everything should be implemented gradually." Ilham's emergence as the elder Aliyev's likely successor has long been anticipated by Azerbaijan watchers. Heidar Aliyev has for years been laying the groundwork for just such a political transition. [For background see the Eurasia Insight archive]. However, the president's illness clearly forced an acceleration of the process, and some observers believe Ilham may now have a tougher time consolidating his authority than he might have had his father had more time to groom his son for power. In recent years, political analysts have questioned Ilham's desire to lead Azerbaijan's government, as well as his abilities to govern. There are also indications that Ilham does not command the loyalty of all factions within the New Azerbaijan Party. Unconfirmed reports indicated that as many as 50 top party members, dissatisfied with Ilham's political skills, recently sent out feelers to opposition leaders about finding a suitable political arrangement that would reduce the risks of confrontation. According to at least one observer, Ilham may himself serve as a placeholder. "His political ambition and skills are believed to be low," the industry newsletter World Markets Analysis reported August 4. In approaching the presidential election campaign, Ilham has taken a tough line on opposition political parties. In a late July television interview, he denounced opposition media for conducting a "slander campaign" surrounding 80-year-old Heidar Aliyev's health woes, adding that government critics "simply want to commit sabotage." Ilham went on to hint that the government might resort to force to prevent the opposition leaders from achieving "their dirty aims." When pressed for specifics on his economic priorities, Ilham Aliyev was evasive, in addition to being defensive about his qualifications. "Certainly, I have accumulated enough knowledge in this area [the economy]," the new prime minister told a state television interviewer. "I ought to analyze this sector thoroughly and then answer the question [on economic priorities]." Ilham Aliyev's prior governmental experience is limited. His official biography says he was born in 1961 and graduated from the prestigious Moscow State Institute for International Relations in 1982. His rise within Azerbaijan's political and economic hierarchy began after Heidar Aliyev's return to power in Azerbaijan in 1993. Most recently, Ilham served as vice president of the state oil company, SOCAR, and was first deputy chairman of the New Azerbaijan Party. He also was elected as a vice president of the Council of Europe's Parliamentary Assembly (PACE). According to the Turan news agency, he resigned both his SOCAR and PACE posts. For now, Ilham Aliyev, along with the rest of the ruling establishment, is maintaining the fiction that the elder Aliyev remains in charge of the day-to-day functions of state. "As for the president's health, it is good. He planned to return a couple of days ago, but the doctors wanted some additional treatment," Ilham told parliament on August 4. "However, I believe he will return to Azerbaijan soon."

From http://www.eurasianet.org/ 08/04/2003

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BAHRAIN: Bid to Strip MP of His Immunity

A BAHRAINI MP may be stripped of his immunity, so that he can be prosecuted for alleged financial irregularities. An official request has been sent to Parliament by Justice Minister Jawad Al Arrayed, asking that the man's immunity be removed. The case is being studied at the moment by the Parliament's legislative and legal affairs committee. It held an urgent meeting on Monday night to discuss the validity of the documents presented to them by the ministry, to support its request. Committee vice-chairman Shaikh Abdulla Al A'ali said the committee's report would be presented to the Parliament's general secretariat office next week. The office consists of Parliament chairman Khalifa Al Dhahrani, first vice-chairman Abdulhadi Marhoon, second vice-chairman Adel Al Maawada, secretary-general Dr Abdulnaser Janahi, financial and economical affairs committee chairman Othman Al Rayes and legislative and legal affairs committee chairman Fareed Rafie, who is currently on holiday abroad. They will take a decision on the issue, because Parliament is not in session until October. (by Mohammed Al A'ali)

From http://www.gulf-daily-news.com/ 08/06/2003

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IRAQ: Governing Council Names Constitutional Committee

The Iraqi Governing Council named a constitutional committee on 11 August to guide the process of drafting an Iraqi constitution, Reuters reported the same day. "A committee of 25 members was formed to define [the] best ways to work out a draft constitution to be approved later on," Ibrahim al-Ja'fari, chairman of the council's leadership committee, told a Baghdad press conference. He told reporters that the constitutional committee comprises university professors and legal experts. The committee will not draft the actual constitution but "will be concerned with discussing [the] best mechanism that will lead to an Iraqi constitution chosen and respected by Iraqis," al-Ja'fari added. He also said he expects a constitution to be drafted within a year. Meanwhile, the U.S.-led administration on 11 August reappointed eight Iraqi Supreme Court justices fired by Saddam Hussein 10 years ago, Reuters reported.

From http://www.rferl.org/ 08/12/2003

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KAZAKHSTAN: New National Coordinator for the Issues of Human Trade

Onalssyn Zhumabekov, minister of justice of RK, has been appointed as a national coordinator for the issues of trade in human beings, a report circulated by the information and public accord department of the MFA of RK says. Also an interdepartmental commission was established, consisting of representatives of the Ministry of Justice, MIA, KNB, general prosecutor and the Agency of RK for migration and demography, which has a task to work out concrete measures against the illegal trade in human beings. In the department of public security of MIA a section for the protection of women victims of the illegal traffic has been organised. The crisis centre "Care" operates together with the international organisation of migration dealing with the protection and rehabilitation of the traffic victims in RK. All foreign diplomatic and consular offices in RK abroad must provide all necessary aid for the illegal traffic victims and cooperate with local police on the issues of the illegal traffic and the punishment of the guilty.

From http://www.gazeta.kz/ 08/08/2003

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TURKMENISTAN: Supreme Authority Becomes Fourth Branch of Power

Asgabat - The People's Council has become the fourth branch of power in Turkmenistan, along with the executive, legislative and judicial. Under the new wording of the constitution published in the Turkmen media on Wednesday [20 August], the four branches are independent and balance each other. It says that the People's Council "shall be a permanently functioning supreme representative body of popular government having the powers of supreme state authority and government". The People's Council has 2,507 members: the president, members of parliament, the chairman of the Supreme Court, the prosecutor-general, Cabinet members, the heads of administrations of five regions, the capital Asgabat and regional and district centres, heads of self-government bodies of districts, and also representatives elected from each district centre, heads of parties, the youth organization, trade unions, the women's movement, those who belong to the [National] Revival Movement, heads of public organizations and members of the Elders' Congress. The functions of the People's Council will be to approve the constitution and constitutional laws and amendments, to form the central commission for elections and referendums, to make decisions on referendums, to set the date of presidential and other elections at various levels, to discuss and approve national programmes of political, economic and social development, to change the state border and administrative borders, and to declare persons found guilty of high treason traitors and permit them to be sentenced for life. On 15 August, the People's Council approved the new version of the constitution. (by Justin Burke)

From http://www.eurasianet.org/ 08/22/2003

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Pacific Leaders Pick Australian to Head Regional Group

The Pacific Islands Forum is headed on a new path after the unprecedented election of an Australian as its top official and a decision to review its secretariat. The three-day forum meeting, which ended in Auckland today, broke with tradition in using a secret ballot, rather than consensus, to choose former Australian diplomat Greg Urwin as its new secretary-general. Australian Prime Minister John Howard had lobbied hard for Mr Urwin in a field that included candidates from Samoa, Nauru and Tonga. The Australian camp had faced opposition from a number of small island states, who wanted another tradition maintained -- that the secretary-general was a Pacific Islander. Mr Urwin is a Pacific specialist. He has a Samoan wife and has been Canberra's top representative in Fiji, Samoa and Vanuatu. He replaces Papua New Guinean Noel Levi, who has been in the job for six years. New Zealand, as forum chair, took a neutral line during discussions over Mr Levi's successor. Prime Minister Helen Clark said the deadlock was broken by "voting by exhaustion". "We have been through an exhaustive and exhausting procedure," she told journalists. "At each point the procedure was agreed on. People went into it in a good spirit, determined to consider all candidates on their merits." Helen Clark said she believed Mr Urwin had prevailed because he was "an exceptional candidate". In response to one question, she said she did not believe Australia had overplayed its hand in Auckland Apart from pushing for Mr Urwin, Mr Howard has said Australia will link future aid in the Pacific to efforts by recipient countries in stamping out corruption. "It's always possible for perceptions to arise that big states are throwing their weight around," Helen Clark said. "It's incumbent on big states to address perceptions and it's incumbent on smaller states to look at the merits of the issue, and I think we are achieving a balance between the two." The Prime Minister said a key positive result of the summit was a long, strategic discussion the 16 leaders had about more ways their countries could work together. She said the review to take place by the end of the year would look at how the Fiji-based secretariat could meet future challenges. "It is a new juncture -- a review, the first in eight years, a new secretary-general and a determination to step up the level of co-operation and partnership across the board." Helen Clark said there had been universal endorsement of the deployment last month of the multinational intervention force in the Solomon Islands. There was recognition that the mission was "getting somewhere" in restoring law and order as the first step to returning the Solomons to the path of economic and social development. Mr Howard agreed that the meeting had marked a "watershed". "It is the most engaged forum meeting I've been to," he said. "This body is seen as having new authority, new clout, new relevance, and everybody will go from this meeting feeling that they're part of something that will punch even harder and more effectively in the region than before." With official business over, forum leaders headed to Eden Park for tonight's Bledisloe Cup rugby decider between the All Blacks and the Wallabies. There was a reference to rugby in their communique, in response to island nations concerns about losing their players to Australia and New Zealand. The forum agreed to take up the issue with the Australian and New Zealand rugby unions and to seek Pacific Islands representation at the International Rugby Board. The communique also supported the reappointment of former New Zealand Foreign Affairs Minister Don McKinnon as Commonwealth secretary-general. Mr McKinnon is seeking a second four-year term, with a decision to be made at the Commonwealth Heads of Government Meeting in Nigeria in December.

From http://www.nzherald.co.nz/ 08/16/2003

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AUSTRALIA: Australia Has New Governor-General

Former SAS commander and decorated Vietnam War hero Major-General Michael Jeffery was sworn in as Australia's 24th governor-general during a brief ceremony in Parliament today. Maj-Gen Jeffery took the oath of office in the Senate chamber in a ceremony presided over by High Court Chief Justice Murray Gleeson. Maj-Gen Jeffery replaced former Governor-General Peter Hollingworth, who stood down early after controversy over his handling of sex abuse claims against the church while Anglican Archbishop of Brisbane. Maj-Gen Jeffery becomes the first Australian-born governor-general to have had a full time military career. His wife Marlena, Prime Minister John Howard and his wife Janette, were among the first to congratulate the new governor-general. Maj-Gen Jeffery has previously served a seven-year term as Governor of Western Australia. Former governors-general Sir William Deane and Sir Zelman Cowan were among the guests in the Senate chamber for today's ceremony. Maj-Gen Jeffery said he was proud to become governor-general, and would work for all Australians and a happy, tolerant society. "I'm so very proud and extremely humble to have been appointed your governor-general," he said. "Together with my wife Marlena, and with your support, I will do my best to fulfil the constitutional and public obligations of this high office with dedication, dignity and integrity." The ceremony ended with a 21 gun salute fired in front of Parliament House.

From http://www.theage.com.au/ 08/11/2003

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Government Services Swell

THE public sector IT services market is expected to grow at more than three times the industry average over the next three years, research firm Gartner says. IT services within the Australian government sector will grow at 13.1 per cent compound annual rate, according to Gartner, compared to an industry average of 2 to 3 per cent for other industries. Gartner Australia research vice-president Richard Harris said that there were several factors combining to drive the update of IT services in the public sector. Gartner has previously released overall Government ICT market figures for Australia, but has never before broken down growth numbers for individual market sectors. The government services market represents one of the few true bright spots in ICT industry, as a former industry darling that has enjoyed nothing but flat growth for the past two years. The Gartner numbers clearly demonstrate why the services giants have poured so much resources into growing market share in the government sector. In all government jurisdictions - from federal to local - the ICT services sector is expected to grow from $2.95 billion in 2003 to $4.27 billion in 2006 - a total increase of 44 per cent. Although the so-called "big bang" outsourcing projects within the federal Government in the late 1990s had largely matured, Mr Harris said the many departments that had previously been reluctant to follow an outsourcing strategy had more recently become more accepting of second and third generation outsourcing deals. In particular, many departments and agencies had embraced to concept of "shared services" model, whereby some agencies are engaging a single supplier to provide a shared service. The model delivers economies of scale to the service provider, and reduced per-transaction costs to the agencies. Some $1.61 billion will be spent on ICT services in the federal and international government category in 2003, rising to $2.3 billion in 2006. Within state and local Governments, the ICT services spend will jump from $1.33 billion in 2003 to $1.92 billion - providing one of the biggest levels of growth for the ICT industry. "State governments seem particularly interested in the shared services model, rather than taking the big bang outsourcing approach that we saw in Canberra a few years ago," Mr Harris said. "And we are also starting to see a lot of business transformational changes that are happening simultaneously (with IT services projects)," he said. "It's actually a more mature way (the state and local Governments) are looking at things, focusing on the core of what they do, and then looking at areas to outsource outside of that core focus." (by James Riley)

From http://australianit.news.com.au/ 08/13/2003

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Govt Comms Spend to Skyrocket

AUSTRALIAN public sector spending on telecommunications equipment will skyrocket more than 85 per cent in the next three years as the various levels of government try to catch up with commercial counterparts in introducing next-generation services. And at a time when both federal and state government departments have suffered information, communications and technology (ICT) cost blowouts worth hundreds of millions of dollars, research group Gartner Australia says public sector ICT spending will grow by just over 25 per cent between now and 2006. The staggering growth in ICT spending comes despite the wholesale moves at all levels of government towards outsourcing ICT operations to third party service providers. In its Government ICT Expenditures report for Australia, Gartner found that expenditure on telecommunications equipment at federal, state and local levels would grow from $US174 million ($266 million) this year to $US323 million in 2006, or by 85.1 per cent. The Gartner ICT expenditure report is conducted annually, with data collated from each of the world's major ICT markets. Gartner Australia research vice-president Richard Harris said the level of growth in telco-related equipment was surprising, but confirmed that network improvement was one of the public sector's highest priorities. "The highest priority area right now has been around network infrastructure," Mr Harris said, especially in areas linked to the introduction of next-generation services like internet-based telephony, and e-government service delivery. "Part of it is about governments playing catch-up," he said. "The public sector wants to provide the same kinds of services that their constituents have come to expect through commercial organisations such as banks. And government is well behind." The hardware industry, which has suffered one of its biggest sales downturns in the industry's history, has something to look forward to from government buyers in the next two years. Gartner's hardware analyst Matthew Boon said government hardware purchases would expand to $US656 million this year compared to a decline of 7 per cent last year. Mr Boon said that government was one of the most serious followers of potential Y2K millennium bug problems, and had replaced much of its hardware during 1999. The result was that government at all levels had entered a critical phase in its "refresh" of ageing Y2K-related systems. "2002 was probably the toughest year in general -- in government and commercials -- that we have had in years," Mr Boon said. "But what we are seeing in the current year is fairly strong growth, and we're seeing a critical replacement period." (by James Riley)

From http://australianit.news.com.au/ 08/14/2003

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FIJI: Prime Minister Under Intense Criticism over Cabinet

FIJI'S Prime Minister, Laisenia Qarase, is under intense criticism for offering the Labour Party only minor portfolios in a cabinet which he has proposed expanding to 36 members. Opposition leader, Mick Beddoes, says Mr Qarase hasn't got what it takes to be a leader, let alone the prime minister. Beddoes says Mr Qarase isn't acting in good faith, doesn't keep his word ,and can't be trusted with leading Fiji. He says the offer of minor portfolios to Labour is a joke designed to ensure that it doesn't enter cabinet. The deputy Prime Minister in the Labour government overthrown in 2000, Adi Kuini Speed, also says Mr Qarase is not acting in good faith and has called on him to think of Fiji and start acting like a leader. The Labour leader, Mahendra Chaudhry, says it's important for the party to enter the cabinet to show that the constitution is workable. He says otherwise critics of the constitution will say it's flawed and needs changing. - FijiTV/PINA Nius

From http://www.pacificislands.cc/ 07/28/2003

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FIJI: Qarase Sets Terms for Multi-Party Cabinet

THE PRIME Minister of Fiji has stressed to Labour leader Mahendra Chaudhry that he wants to make the final decisions on the multi-party cabinet issue by the end of this month. Lisenia Qarase also says he told Chaudhry during their meeting yesterday that there wouldn't be any negotiations on the size of cabinet or the portfolios offered to the FLP. The two leaders are expected to meet again when Qarase returns from the Pacific Islands Leaders Forum in Auckland next week. - Fijivillage/PINA Nius

From http://www.pacificislands.cc/ 08/12/2003

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GUAM: Senator Jailed for Corruption

Former Guam Senator Marilyn Manibusan has been jailed for five years and eleven months on corruption charge. Manibusan was sentenced along with former Guam Housing Corporation President James Sablan, who was given three years' probation. It is alleged the pair received payments from real estate developers, in return for supporting their projects. They were charged with offences including conspiracy, wire fraud, misapplication of government funds, money laundering, and extortion. Sablan pleaded guilty to the charges while Manibusan was convicted by a grand jury. ABC/PINA Nius

From http://www.pacificislands.cc/ 08/20/2003

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NORTHERN MARIANAS: Senator Gets Five Years for Nepotism

A Commonwealth of the Northern Mariana Islands senator was sentenced yesterday to five years and three months for his involvement in a scheme to provide "no-show" jobs to his and other CNMI senators' relatives. A District Court ordered Sen. Ricardo S. Atalig, 50, to pay $39,663.70 in restitution, a $10,000 fine and a $2,700 special assessment fee. He is scheduled to surrender to the U.S. Marshal's Service on Aug. 28 to begin his sentence, according to a press release from the U.S. Attorney's Office. Atalig was indicted in December along with CNMI Sen. Jose Dela Cruz, and Cruz's daughter, Marjorie. In April, a federal jury found Atalig guilty of one count of conspiracy to commit wire fraud and 26 counts of wire fraud. The evidence at trial showed that Atalig and other senators schemed to defraud the government by providing jobs on their respective staffs to their relatives. The scheme cost the CNMI government more than $147,000. Current law forbids senators from hiring relatives. Some of the jobs were "no-show" arrangement in that the employees did not report to work or did not perform any substantial part of the work called for in their employment contracts. One of the "no-show" jobs was arranged for Marjorie Dela Cruz to work as a community worker in Atalig's senate office in Saipan at a cost of $39,663.70 on a three-year contract. While receiving the salary, Marjorie Dela Cruz was a full-time University of Guam student, receiving $15,969.50 in CNMI and Tinian scholarship funds. In return for the "no-show" job for his daughter, Jose Dela Cruz hired a relative of Atalig as a full-time community worker. Under a plea agreement, co-defendant Jose Dela Cruz pleaded guilty to conspiracy to commit wire fraud and is scheduled to be sentenced on Oct. 7, the release said. The investigation was conducted by the FBI and the CNMI Office of the Public Auditor. - GuamPDN/PINA Nius

From http://www.pacificislands.cc/ 08/15/2003

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NAURU: Ping Pong Presidency

Once again, there's another change of leadership in the Micronesian nation of Nauru. Incoming President Rene Harris has just announced a new Cabinet, after ousting Ludwig Scotty in a no-confidence motion last week. Last Friday Harris was re-elected as President of Nauru for the fourth time, after leading a no-confidence motion in parliament against former President Ludwig Scotty. His re-election continues a period of leadership turmoil in Nauru's Parliament which has seen five changes in the Presidency this year. Elections in early May saw new faces in Parliament, but no stability. After weeks of stalemate where no-one could command the confidence of the 18-member Parliament resulting in the successful non-confidence vote. And now Rene Harris is President again, and has announced a new Cabinet line-up. President Harris has taken key portfolios in the 5-member Cabinet, and will serve as Minister for Foreign Affairs, Public Service and Health. He will also be minister responsible for the Nauru Phosphate Royalties Trust, a key portfolio in managing the country's battered economy. Derog Gioura will serve as Minister assisting the President and will take on the Cabinet portfolios of Women's Affairs and Good Governance. Remy Namaduk will be Minister for Island Development and Industry, while Justice, Fisheries and Natural Resources goes to Godfrey Thoma. The final member of the Cabinet will be former sporting star Marcus Stephen as Minister for Finance, Education and the Nauru Finance Corporation. With ongoing debate about economic policy, financial management, corruption and the future of the asylum seeker detention centres on Nauru, there's likely to be more changes in the months to come. Mr Harris was today unavailable for comment. - ABC/PINA Nius

From http://www.pacificislands.cc/ 08/13/2003

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NEW ZEALAND: Public Servant Sacked over $1.9m Fraud Allegations

A senior public servant has been sacked for allegedly using her position to pull off a $1.9 million fraud at the Ministry of Social Development. The woman is alleged to have used her powers at the ministry's Wellington headquarters to commit fraud over 2 1/2 years by using bogus contracts and false identities. She was immediately suspended when the fraud was detected two weeks ago and has since been fired. It is understood the woman was trusted and highly regarded and had been working for the ministry for the past five to 10 years. The case has been handed to the Serious Fraud Office. Although the ministry would not say how the woman was detected or how the scam worked, it is understood to have involved 67 bogus invoices. Ministry chief executive Peter Hughes said the scam was "one out of the box". "This individual took advantage of management changes, organisational restructuring and crucial periods in the financial calendar to avoid detection." Mr Hughes said that if convicted, the woman faced a criminal conviction, a prison term, bankruptcy and asset seizure. Staff were in shock and felt deeply betrayed by the woman. "It goes without saying that I am personally hugely disappointed," he said. The ministry, one of New Zealand's largest Government departments, is responsible for around $13 billion of taxpayers' money through social welfare benefits, superannuation and student loans. There have been 43 cases of staff fraud at the ministry in the past three years. Figures released last year show nearly $1 million in benefits had been stolen by 28 Work and Income staff over a two-year period. Mr Hughes said he had started an independent inquiry to ensure the ministry was doing all it could to prevent fraud. "We are responsible for large amounts of public money and taxpayers need to have confidence in our integrity." Social Development Minister Steve Maharey said he had been fully briefed on what was clearly a staffing issue, and completely supported the actions taken. Teina Tikaroa, a Mangere-based beneficiaries advocate, said the alleged fraud set a poor example. "It is hard enough to get a benefit with all the checks and personal information, but here is someone in a position of authority ripping it off. "A beneficiary has to be accountable for every cent they get. What about the people in charge?" (by Patrick Gower)

From http://www.nzherald.co.nz/ 08/07/2003

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Key Gets National's IT Role

The National Party has appointed John Key as its spokesman on communications and information technology. The 41-year-old Helensville MP is also associate spokesman for commerce and transport. The communications and IT roles were previously held by out-of-favour MP Maurice Williamson. Mr Key has already caught up with TelstraClear chief executive Rosemary Howard in his new role and says he is concerned by the low take-up of broadband Internet services in New Zealand. "Given the structure of New Zealand business going forward is likely to be far more communications intensive, this raises the question of why take-up is so low and what we can do to improve it." He is also concerned by mobile phone charges which he says are alarming when compared to other OECD countries. Mr Key is reserving his position on the unbundling of the local loop till he has had more extensive conversations with telcos. "New Zealand, with a population of four million, looks unlikely to have an extensive second or third network, so you would have to think from a country perspective that maximising competition on the current network makes sense. "But I can see there are a fair few property rights involved there from Telecom's perspective." Other key communications policy issues are fixed and mobile number portability and the Kiwi share, he says. Mr Key spearheaded the e-commerce initiatives of financial services firm Merrill Lynch in Europe in 2001 at a time when "disintermediation" was the watchword in the sector, before coming to parliament at the last election. "I think have an appreciation of the significant changes information technology is going to bring about. Everybody was thinking the Internet was going to have a major effect on the financial services sector and that has certainly been true in parts. The delivery of financial research is now mostly electronic, for example. "But the uptake of online trading, despite being more cost efficient, has been less successful than anticipated. My view is it's only a matter of time before it has a major impact." Mr Key says IT can play a part in tackling the "tyranny of distance" faced by New Zealand businesses. "It's pretty exciting, but we have to be able to compete." He says technology could also be significant for rural and provincial New Zealand, particularly given Auckland's infrastructure issues. "I've talked to people in Wanganui who have complained that government departments want them to have a physical presence in Wellington before doing business with them. That's not the way of the future." (by Tom Pullar-Strecker)

From http://www.stuff.co.nz/ 08/11/2003

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PNG: Cabinet Shuffle

SEVEN new ministers, including five rookies, were sworn-in at Government House on Saturday as Prime Minister Sir Michael Somare finally acted on his promise for a Cabinet reshuffle to reward his coalition partners. Somare's National Alliance Party lost four ministries including Environment and Conservation held by Huon Gulf MP Sasa Zibe and Internal Security held by Lufa MP Yawa Silupa - both have been dropped completely. Goroka MP and United Party leader Bire Kimisopa takes Internal Security, while Mount Hagen MP William Duma from United Resources Party comes in as Environment Minister. The other first-timers include Middle-Fly and Peoples Action Party MP Roy Biyama (Higher Education, Research, Science and Technology), Gumine and Peoples' National Congress MP Nick Kuman (Culture and Tourism) and Angoram MP Arthur Somare who takes over the Privatisation Ministry from his father but under a new name - State Enterprises and Information. Mr Kuman takes over from Madang MP Alois Kingsley, who had been suspended for allegedly assaulting a UPNG professor. Nipa-Kutubu MP Robert Kopaol has also been dropped as a minister to pave way for his senior Peoples Progress Party colleague and Mendi MP Michael Nali to be Lands and Physical Planning Minister. Usino-Bundi MP and Peoples Labour Party leader Peter Yama was finally recognised as Labour and Industrial Relations Minister while Peter O'Neill moves to Public Service. He keeps his other role as Leader of Government Business. The reshuffle is the first since the Somare government came into office 12 months ago and Sir Michael said there would not be another one for a long while yet. Mr Somare's appointments leave the Governorship of East Sepik province vacant with Wewak MP Kimson Kare the hot favourite to replace him. Announcing the changes before departing for the Melanesian Spearhead Group meeting in Solomon Islands, Sir Michael said he had promised to provide political leadership and stability when he took office and said,"I am demonstrating that now". The new Cabinet composition sees NA with 8 (including PM), PPP (4), PAP (4), PNC (3), Melanesia Alliance (2), PLP (2), URP (2), Pangu (1), UP (1) and National Party (1). - The National Online/PINA Nius

From http://www.pacificislands.cc/ 08/04/2003

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PNG: PM Offended by 'Failed State' Connotation

PRIME Minister Sir Michael Somare has taken exception to the term "failed state" or "weak state" to describe Pacific Island countries, including Papua New Guinea. "I am concerned that there is no clear idea of what constitutes a weak or failed State," Sir Michael said at the newly established Pacific Co-operation Foundation (PCF) in New Zealand yesterday. He told the meeting that PNG was concerned about the way foreign academics, journalists and governments try to determine the fate of small developing countries: "The designation of the term weak or failed to a developing nation seems to us to be rather arbitrary," Sir Michael said, referring to a report of academics this month describing PNG as a "failed State''. "We have not had a military coup despite presumptions of some analysts and the very difficult political, economic and social climate since political independence in September 1975." He conceded that there have been "public challenges" of the Government-of-the-day's decisions by the military and police in the past which had been quelled through the democratic process and that "respect for the democratically elected government has always prevailed''. Yesterday, Australian Prime Minister John Howard flagged that future financial aid would be contingent on efforts to root out corruption. Sir Michael said any decision about reviewing the conditions of aid was up to Australia. "We have existed, all the island countries have existed all this time. We have gained independence as sovereign nations. We have survived, even before elected governments. Pacific islanders have always survived," he told reporters. - Post Courier/PINA Nius

From http://www.pacificislands.cc/ 08/15/2003

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SOLOMON ISLANDS: Government Backbencher Alleges Corruption

MINISTERS and backbenchers serving under the current Solomon Islands government are being called on to resign from their political parties. Member of Parliament for Fataleka, Casper Luiramo, alleges that if the government ministers and backbenchers continue to serve under corrupt leaders, they will be seen as implementing corrupt instructions and are serving only a few cronies, not the nation. Mr Luiramo also calls on voters in Solomon Islands whose parliament leaders are serving under the government to ask their leaders to stop serving in the current leadership. He says many issues need to be addressed including the health, education and the economic crisis which the country is currently facing. Mr Luiramo also requests parliamentarians in the government to seriously consider their current positions and how they will affect their chances of retaining their seats at the next general elections. - SIBC/PINA Nius

From http://www.pacificislands.cc/ 08/16/2003

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TUVALU: Prime Minister Waiting for the Numbers

Tuvalu's Prime Minister, Saufatu Sopoanga, says he will delay the reconvening of Parliament until he has regained majority support. A court sitting is scheduled for next week to rule on Mr Sopoanga's refusal to call Parliament, but he says he will try to hold out. "Could be next month, could be September, or October, I'm not sure, as I said as soon as I get the majority I will call Parliament". At present, by-elections have given the Opposition leader Amasone Kilei, enough support to seek a leadership challenge if parliament sits. - RNZI/PINA Nius

From http://www.pacificislands.cc/ 07/31/2003

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APEC SME Ministers Call for Greater Networking Between Business, Government, Trade Promotion Authorities and Banks

The 10th Small and Medium Enterprises (SMEs) Ministerial Meeting has concluded in Chiang Mai, Thailand, with Ministers calling for Member Economies to strengthen networks between business owners, trade promotion agencies and SME focused financial institutions. In the Joint Ministerial Statement, "Strengthening an APEC Entrepreneurial Society," Ministers highlighted the courageous and critical role played by SMEs and Micro-enterprises. "The definition of an entrepreneur goes beyond the conventional meaning of business owner and operator and that risk-taking individuals are the driving force behind entrepreneurship," the statement noted. "The development of a dynamic entrepreneurial society requires individuals who are innovative, visionary, and ready to take the risk of starting-up a new business. "A vibrant entrepreneurial society is central to the growth of the APEC economies. Substantial entrepreneurial activity generates demand for new services, products, and jobs." Ministers also highlighted the challenges brought about by globalization and the role APEC member economies have to play in dealing with these pressures. "To cope with the challenges of globalization, APEC economies should focus on developing networks among micro, small and medium enterprises (MSME) and promotional agencies, MSME banks and MSME associations. "The entrepreneurial environment is directly affected by: regulatory and tax burdens; labor market legislation; competition policy and legal conditions. Each economy is encouraged to speed-up efforts towards the removal of barriers to entrepreneurial behavior and not to introduce regulations that overly penalize business failure." In the Joint Ministerial Statement Ministers also highlighted the role of education in promoting business development and stressed the importance of Members identifying and developing entrepreneurial potential in their economies. Ministers made particular note of the difficulties that are often faced by MSMEs in accessing finance and encouraged APEC Members to seek ways and means to expand financing facilities. Ministers also encouraged APEC Members to be proactive in developing capacity within their economies to build the capacity of SMEs to trade beyond their borders and explore export markets. The Ministers adopted the Micro-enterprise Action Plan that is designed to help the smallest businesses in the APEC region through expanding access to new technologies, improving access to finance and undertaking greater research into the challenges facing Micro-enterprises. Ministers also expressed their ongoing support for the ongoing cooperation between the APEC SME Working Group and other APEC fora such as the APEC Sub-committee on Standards and Conformance, the APEC Finance Ministerial Meeting, SME Financing Institutions, the OECD and business sector groups including the APEC Business Advisory Council and the APEC Women Leaders Network. The next APEC SME Ministerial Meeting will take place on October 6 to 7 in Santiago, Chile. This will be preceded by an APEC SME Working Group meeting in Vancouver, Canada, on March 8 to 10 next year and the second SME Working Group meeting for 2004 in Santiago, on October 3 to 5. (by Chiang Mai)

From http://www.apecsec.org.sg/ 08/08/2003

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ASEAN Plus Three Mechanism Boosting Regional Economy: Chinese Official

The enhanced regional cooperation in East Asia boosts the trade, economic and investment links among ASEAN plus three members, and has expedited regional economic integration, Chinese Finance Minister Jin Renqing told a regional conference in Manila on Thursday. "Taking the trade of China with ASEAN countries, Japan and Korea as an example, the trade volume has been expanding for several years," Jin made the remarks at the one-day ASEAN plus three Finance Ministers' Meeting, which also involved his counterparts from the 10 ASEAN members as well as Japan and South Korea. "After sealing a rapid growth in 2002, China also stepped another big stride forward in trade with Japan, Korea and ASEAN countries, striking growth rates of 36 percent, 44 percent and 45 percent," Jin added. "When the world economy is fluctuating, the economic and trade cooperation among ASEAN plus three members has played an increasing role in promoting economic stability and growth in Asia," Jin explained, adding, "Under the concerted efforts by the Asian countries to actively making economic restructuring, exploring the domestic and regional markets, and promoting the trade and investment facilitation within the region, the economy in Asia will overcome the lackluster global environment, regain greater vigor and bring about new economic miracles." Jin also said that China supports the Asian Bond Market Initiative which accords to the regional interest, and that it stands ready to actively participate in various researches and cooperation in this regard. The regional bond market will go through three stages: firstly, self-improvement of domestic bond market by the member countries; secondly, opening domestic bond markets wider to other members so as to facilitate the gradual integration of individual markets; and finally, forging a single regional market, Jin elaborated. "Presently, only a few members have entered into the second stage, while most members are still on the way to fulfill the first, representing the biggest obstacle for the establishment of Asian Bond Market. Therefore, we should focus our next-step efforts on the improvement of domestic bond market," Jin noted. Jin also believed that the participants in the Asian Bond Market include not only government agencies but also issuers, investors and intermediaries in the private sector. With the constant development and integration of the economic and financial system in Asian countries, a vibrant Asian Bond Market will finally come into being. China is "very pleased" to see that significant progress has been achieved in implementing the Chiang Mai Initiative, Jin said, adding that the bilateral currency swap network promoted by the Initiative will positively contribute to the regional financial stability. "More importantly, it demonstrates the strong political will and determination of the East Asian countries to jointly strive for self-improvement," Jin concluded.

From Xinhua News Agency 08/08/2003

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Closer APEC-World Bank-ADB Cooperation to Address Joint Economic Growth and Development Goals

APEC, the World Bank and the Asian Development Bank (ADB) have agreed to combine their comparative advantages to work together on initiatives relating to poverty reduction and economic stability. The commitment was made at the first ever APEC Roundtable Discussion with international financial institutions on August 19, in Phuket, Thailand. Chair of the meeting, Mr. Tej Bunnag, said the new era of cooperation would increase the efficiency of all organizations and avoid duplication of effort. "APEC's focus on economic growth and the World Bank and the ADB's focus on development makes our cooperation both natural and imperative," Mr. Bunnag said. "The World Bank and ADB have a wealth of research and expertise that can be leveraged through the sharing of training materials, work programs and information for project planning. "APEC has useful forums and mechanisms to complement work undertaken by the World Bank and ADB. The APEC Leaders? and Ministerial Meetings bring together the senior political decision makers in APEC economies. These APEC events will be very useful in obtaining high-level commitment for issues of common concern to APEC and the World Bank and ADB." Mr. Bunnag said the Roundtable between APEC, the World Bank and the ADB covered the four areas of improving counter terrorism efforts, addressing the social dimensions of globalization, building a knowledge based economy and integration into the global economy. "Capacity building is one of the highest priorities for APEC, the World bank and the ADB in our efforts to strengthen our increasingly integrated Asia-Pacific economy," Mr. Bunnag said. "The representatives from the World Bank, the ADB and APEC agreed that joint APEC, World Bank and ADB projects must have real impact on the ground. "Reports and studies in themselves are of limited utility in addressing real problems such as poverty reduction. These need to be translated and customized into specific solutions for each economy to apply to its particular set of problems and to craft appropriate solutions." The World Bank and ADB were invited to engage in the activities of APEC's Social Safety Nets Capacity Building Network. An essential part of this work includes work to build the capacity of the informal sector to deal with globalization and be integrated into the economic mainstream. The World Bank and ADB were also invited to participate in APEC's Knowledge Based Economy-related activities at a committee and working group level, and the Innovative APEC workshop. The World Bank was represented by Mr Peter Stephens and the Asian Development Bank was represented by Mr Xianbin Yao.

From http://www.apecsec.org.sg/ 08/20/2003

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CHINA: Government to Adopt International System of Measuring GDP

China is expected to offer the most accurate statistics on its gross domestic product (GDP) in its history this year, but it will take at least another three years to amend the loopholes that have contributed to the serious underestimation of the portion supplied by the nation's service sector. China has adopted a completely new GDP calculation method for 2003 based on the 1993 SNA (System of National Accounts) standards jointly formulated by the United Nations, the World Bank, the International Monetary Fund, the Organization for Economic Co-operation and Development and the European Union, said Xu Xianchun, director general of the Economic Verification Department of the National Bureau of Statistics (NBS). The new method supplants some contents of the Guideline for Measuring GDP and National Income initiated by the State Council in 1992, including calculations concerning national income, fiscal credit balance, collective consumption and social consumption. "The most drastic change involving the service sector, however, is that the new method does not recognize a division of 'material production sectors' from non-material production sectors," Xu said. According to experts, the new method lays a solid foundation for the solution of two of major economic statistical problems in China. One concerns the overestimation of the output value of the industrial and agricultural sectors, said Yue Ximing, a researcher with the economic research institute of the China Academy of Social Sciences, and the other involves the serious underestimation of the thriving service sector. The overestimation of industrial and agricultural output is the result of some local governments exaggerating "achievements" in the name of political career development, said Zhang Shuguang, head of the Tianze Economic Research Institute, but the national GDP figures will not change much as they strike a balance between the overvaluation with the underestimation of the service sector. However, none of the economists and officials China Daily spoke with could provide detailed figures indicating just how great the undervaluation has been. "It will take another three years for an extensive co-operation project between the NBS and the Asian Development Bank (ADB) to yield significant results, which will aid the creation of a scientific statistical mechanism for assessing the service sector," Xu said. The MPS (Material Product System) is based on balance tables measuring, for example, the balance between production, consumption and accumulation of the gross social product; the balance between production, distribution, redistribution and final use of the gross social product; the balance of labour resources; and the balance of fixed assets. The MPS sorts a country's economic activities into one of two categories: material production and non-material services. Only the former creates national income, while the latter consumes that income. The main indicators in the MPS rely entirely upon this assumption. In the MPS framework, industry, agriculture and construction are wholly included in the material production category, while transportation, communications and commerce are only partially included. Erasing the distinction between material production and non-material services essentially conforms to the coverage of economic activities in the SNA method of calculation. The major difference between the two systems is that the separation of non-material services from material production constitutes the basis of economic analyses in the MPS methodology. The SNA, which originated in developed economies, is now practised by most countries around the world. Five international institutions, including the United Nations, the World Bank, the International Monetary Fund, the Organization for Economic Co-operation and Development and the European Union, devised the SNA's standards in 1993. China's new national accounting system, which goes into operation this year, is based on a calculation system revision that began in 1999 according to SNA standards.

From http://www1.chinadaily.com.cn/ 08/14/2003

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Private, Foreign Companies Urged to Allow Trade Unions

The All-China Federation of Trade Unions (ACFTU) yesterday urged private and foreign companies to allow the establishment of trade unions in order to safeguard the legal rights of their employees. Some private and foreign companies in China have been trying to prevent their employees from establishing trade unions, which are playing an increasing role in protecting workers' legal rights, according to the federation. "Parts of such companies, especially the branch operations of transnational companies, refuse to set up trade unions," said Guo Wencai, director of the ACFTU Grass-roots Organization Department. Wang Ying, a division director of the department, said the United States-based leading international retailer Wal-Mart was refusing to allow the establishment of unions in its Chinese branch operations. "We've made increased efforts for several years but failed," said Wang. Sources at the headquarters of Wal-Mart's China operations, based in South China's Shenzhen, admitted there were no trade unions in its stores in several Chinese cities. "We have no trade unions and have never seen any explanation why no such unions exist," said a public relations officer surnamed Huang reached by China Daily via telephone. She said no senior Wal-Mart officer was available for comment as they are on holiday. But ACFTU official Wang Ying said Wal-Mart's official explanation was that the multinational company did not allow the formation of trade unions in any of its global operations. Wang said some owners of foreign-funded enterprises do abide by China's laws and regulations and encourage their employees to join unions. But she also said more work needs to be done to inform foreign investors of China's laws on trade unions. The latest ACFTU statistics indicated that China has 400,000 foreign companies, but only one-fifth have set up trade unions. About 40 percent of two million private enterprises have set up trade unions. "And workers need unions more than ever to represent and protect their interests," said Wang. Guan Binfeng, another ACFTU division director, said infringement of employee's legal rights frequently took place in foreign and private companies without trade unions. A survey conducted by the provincial Department of Labour and Social Security of China's economic powerhouse of Guangdong revealed that 85 percent of about 26 million migrant workers in the province have to work for 10 to 14 hours every day and nearly half of them have no rest day, and most of them are not paid for overtime. The Chinese Government has stipulated that the maximum working day is eight hours and that the working week should not exceed 40 hours. Employers must double or triple wages paid for extra hours. Since last year, several State Council departments have joined hands with the ACFTU to deal with payment arrears problems. Unions are essential to protecting the interests and rights of workers and resolving worker-management relations, and the number of trade unions should be increased particularly in non-State-owned enterprises, said Guan.

From China Daily 08/14/2003

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Chinese Officials Receive Training in Harvard

Fifty-nine local Chinese officials leave Beijing for the United States today to take a six-week training course on public administration and international development issues. The educational mission is expected to enhance the trainees' public management strategies and analytical skills to help prepare them to face the challenges at home, said Sun Xiaoyu, vice-director of the State Council Development Research Center (DRC). The trip is part of a "China's Leaders in Development Program" kicked off by the DRC, Tsinghua University in Beijing and Harvard University last year, to train around 60 Chinese officials each year until 2006, according to DRC sources. Tian Qian, deputy secretary general of Tsinghua University, said further reform of government management in China will require high-caliber government officials. The joint program at Harvard's Kennedy School of Government (KSG) represents a bold and practical move towards upgrading the skills of officials, he said. Candidates for the program are usually high-ranking local government leaders under 45 years of age. But this year the "students" seem to be generally younger, and fewer than 10 of them are women, according to Wang Youqiang, a staff member of the Tsinghua University School of Public Policy and Management. Before they left for Harvard, the participants had already finished a three-week crash course at Tsinghua University taught by the university faculty and DRC experts and focusing on the key economic and social issues in China, according to Sun Xiaoyu. Anthony Saich, faculty chair of Asia Programs, who is responsible for the training project at Harvard, said last year all the Harvard faculties were "enormously impressed" with the quality of the Chinese students in the program. "To be quite honest it exceeded our expectations," he said in a telephone interview. "This year, our main objective remains the same: to provide these officials with the tools to think strategically about local government management and to introduce a number of the best practices from around the world for their consideration," he said. The American costs of the program are being underwritten by Amway (China). Li Chaoxing, vice director of the Tianjin Municipal Economic Commission, who participated in last year's program, yesterday said the Harvard project presented a new mode in training officials. "I was impressed by the case discussions," Li said. "What I learned is a method of thinking geared to finding solutions."

From China Daily 08/16/2003

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Luo Gan Calls for Better Grassroots Development

Senior Chinese official Luo Gan called for better grassroots efforts to provide a sound social environment for China's reform and development during a recent inspection tour in east China's Shandong Province. From Aug. 12 to 17, Luo Gan, a member of the Standing Committee of the Political Bureau of the Communist Party of China (CPC) Central Committee and Secretary of the Political and Legislative Affairs Committee of the CPC Central Committee, visited factories and institutions in the cities of Jinan, Dezhou, Zibo, Weifang, Yantai and Weihai in Shandong and talked with local officials. e said political and legislative works should help maintain social stability and market order, as well as provide a sound environment for the country's reform and development. He also urged political and legislative departments at various levels to use theories of the "Three Represents" to guide their works and take measures to improve grassroots works. Luo also said that the "strike-hard" campaign against various crimes should be regularized to increase its effectiveness. According to Luo, greater efforts should be made to promote reforms on the country's judicial system by emphasizing judicial justice and better serving public needs.

From Xinhua News Agency 08/18/2003

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Net Ready E-Business Seminar Series to Be Introduced

China Enterprise Confederation (CEC) and Cisco Systems China announced today the Net Ready E-Business Seminar Series. This series will share the real experience of Cisco Systems and Chinese enterprises. It is designed to teach business leaders and managers how to use information technology (IT) and the Internet to achieve better business results. China Business Cybercast (CBC) will broadcast a six-part weekly series, beginning on August 25, based on the concepts and principles of the book Net Ready and Cisco's expertise in using information technology (IT) and the Internet as a strategic enabler for creating business value. It is expected that enterprise business leaders and senior managers, and students and faculty of sixty universities will view the broadcast. In the future this series will also be available on CEC's new iQ Net Readiness Education Portal at http://www.cec-ceda.com/. This informative and timely series will feature insights and real-life practical examples from Cisco executives, Chinese business leaders, and e-business experts and thought-leaders. The series will review challenges, opportunities and the business and IT keys for success for Chinese enterprises using IT and the Internet. "Globalization and the recent health crisis has made e-Business a "must have" for Chinese Enterprises," said Chen Ying, Deputy Director General of CEC. "However, Chinese business leaders are concerned about investing wisely. Net Readiness provides a simple practical framework and methodology to do e-business right." CEC recently introduced a new portal for e-Business education for Chinese enterprises. This series provides yet another tool for Chinese enterprises. Cisco Systems, Inc (NASDAQ:CSCO) is the worldwide leader in networking for the Internet. Information on Cisco can be found at http://www.cisco.com/.

From Xinhua News Agency 08/19/2003

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WHO to Train Thousands of Chinese Medical Workers

(UN Wire)-- Thousands of Chinese medical workers will undergo training with the World Health Organization amid fears of a return of severe acute respiratory syndrome with the onset of cold weather, the WHO said today. The WHO training is aimed at making health workers better able to halt the spread of infectious diseases through hospitals, said WHO communicable diseases expert Alan Schnur. The WHO will hold its first round of training in Beijing and eventually expand the program to other parts of the country. According to a recent study, 30 percent of all urban Chinese fear a return of SARS with cold weather in the coming months. Many Chinese were reportedly afraid to go to hospitals during the height of the SARS crisis for fear of catching the disease. Schnur called for measures to prevent the spread of the disease but said it remains unclear whether SARS will emerge again as temperatures fall in autumn.

From Agence France-Press 08/21/2003

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Academics, Government Linked by New NGO

A non-profit and non-government organization with a focus on political restructuring studies and policy consultation was established on Saturday in Beijing. Yu Keping, director of the newly founded Center for Chinese Government Innovations which is affiliated to the Institute of Political Development and Government Administration under Peking University, said his center was set up to build close co-operation between academia and officials. It will also study significant theoretical issues and policies concerning Chinese governance innovations. Consisting of dozens of renowned professors and researchers in political and social studies, Yu said his center would find, evaluate, study, reward and disseminate innovations adopted by all levels of government in order to promote a socialist political civilization in China. Jointly run by the Ford Foundation and two Chinese institutions on political studies, the center is undertaking selections for the second Government Innovations Awards. The focus is currently on exploring a set of objective criteria for evaluating local government performances in a bid to promote studies on Chinese politics, according to Yu. The first 2002 awards selected 10 winners and 10 runners-up from 320 local applicants. Among the winners, the competitive election for township mayors and Communist Party secretaries in Southwest China's Sichuan Province was an eye-catching governance innovation. Yu said since the reform and opening-up, governments at various levels have made many brave reforms and innovations in different fields, such as public service, administration reform, political transparency, grass-roots democracy and scientific decision-making. All of the innovations were considered for participation in the second set of awards for 2003-04, in order to exchange experiences and push forward political progress in China, said Yu.

From China Daily 08/25/2003

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JAPAN: Government Plans Town Meetings

The government will hold a series of town meetings over seven days starting Monday in an effort to win more public support for Prime Minister Junichiro Koizumi's structural reforms. The weeklong event will promote specific reform plans that Koizumi will include in his pledges during campaigning for re-election as Liberal Democratic Party president. The LDP leadership poll will be held Sept. 20. The prime minister is scheduled to attend the gatherings Wednesday in Osaka and Sunday in Tokyo, while members of his Cabinet will take part in those and other town meetings in seven cities nationwide. Koizumi launched the town meetings in June 2001 -- two months after he became prime minister -- to strengthen dialogue with the general public. The events held so far in 86 locations nationwide have been attended by more than 30,000 people. This will be the first time that such meetings will be held seven days in a row. The locations are Saitama, Fukuoka, Osaka, Nagoya, Sapporo, Sendai and Tokyo.

From The Japan Times 08/04/2003

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New Ministry Policy Takes One-on-One Approach

A recently adopted Health, Labor and Welfare Ministry policy guideline calls for a more individualized approach to the nation's homeless problem that takes into account the personal history of each person living on the street. The guideline, which sets the direction of government policy over the next five years, was mandated by a law enacted last year to promote self-reliance among the homeless population, whose ranks have been growing in recent years. A government census conducted earlier this year -- the first of its kind -- found some 25,000 homeless people nationwide. The primary objective of the new policy is to help them "live a stable life on their own" by securing employment, housing, and medical and other welfare services in cooperation with local governments. Based on the survey, the ministry concluded that many homeless people wish to work and lead a normal life, many are in need of medical and welfare services, and some refuse to return to society. About 2,000 homeless people were interviewed in the course of the census, and roughly half of them indicated a strong wish to work. The ministry views employment assistance as crucial for those who want to work. In cooperation with local governments, the ministry plans to offer job information services and counseling, and street-cleaning and other peripheral job opportunities for those who otherwise would be unable to find employment. Local governments will be urged to provide housing and medical services, as well as counseling on personal and mental problems, to help get people off the street and to keep others from becoming homeless. The ministry is also emphasizing the importance of taking into account the individual history of each homeless person to learn the reasons behind someone turning to a life on the streets. The ministry admitted, however, that the reasons for people becoming homeless are often complex and can include a combination of various personal and social problems. "The protracted economic slump, diminishing communication within families and communities, and public rejection of homeless people are all said to be factors that brought about the current problem," the ministry said in the policy guideline. The background of each homeless person must be taken fully into account and aid provided in both a comprehensive and individualized manner, according to the ministry. (by Hiroshi Matsubara)

From The Japan Times 08/20/2003

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SOUTH KOREA: Ministry Reviews Reform Efforts at Government Affiliate Organizations

The Ministry of Planning and Budget (MOPB) reported on Friday (August 1) that it recently held an evaluation of government-affiliate organizations for their reform efforts and effectiveness of operation. Conducted on 202 affiliate agencies and organizations, the review brought out a welcome report that the organizations completed 500 reform projects, which exceeded 35 percent from their goals of 369 projects set for the year's first six months, the ministry said. The review also showed a noticeable progress in budget reduction efforts, including steps to reduce the payroll and dispose corporate assets. Similar improvement was shown in e-government procurement programs, the effort to set up "customer participation centers," and the introduction of merit-based operational systems. The ministry said a group of outside experts will evaluate the entire year's performance of the agencies and organizations at the end of the year.

From http://www.kois.go.kr/ 08/04/2003

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Labor Participation in Management - Hyundai Motor's Decision Stirs Up Business Community

The business community is perplexed by Hyundai Motor's decision to allow labor to take part in management, succumbing to the most crucial demand from its union workers on strike. The nation's largest carmaker will also introduce a five-day workweek with pay remaining intact starting next month, as another concession offered to unionists in exchange for their ending the 47-day labor disruption. The business community fears that trade unions at other corporations, family-owned conglomerates in particular, will be encouraged to follow suit. They hoped that Hyundai would defend their management rights under any circumstance as it had pledged during the course of negotiations with the union to resolve the labor unrest. It is reported that Hyundai yielded to the toughest demand to avoid government intervention in its labor disputes that have further confounded the current economic plight. The government recently warned that it would have no choice but to get involved in negotiations if the conflicting sides were unable to quickly reach a compromise. Setting aside the enormous losses at home, Hyundai has been forced to suspend operations at overseas plants because it is unable to supply them with parts due to the strike. This has been to the detriment of exports, the main engine of Korea's economic growth. Hyundai's hasty decision, to the dismay large companies, is chiefly ascribed to its apprehension that government intervention would make matters worse because it would be forced to bow to nearly all the union's demands in the end. The worry is not groundless in that unions in major labor disputes have achieved their goals through government mediation since President Roh Moo-hyun took office in February. It is deplorable that Hyundai workers, who are reportedly paid more and enjoy more benefits than many employees at other companies, annually resort to illegal actions to realize their greedy demands. Many business experts are of the opinion that the government should have harshly dealt with the illegal labor activities at Hyundai in light of their effect on trade unions that are scheduled to begin their own negotiations with management. They say the present economic straits will be further aggravated because big corporations dealing are suffering from labor disruptions for the time being with union demands for participation in management and a 40-hour workweek. In this regard, the government needs to crack down on illegal labor activities to help business interests actively pursue their investments and other projects

From The Korea Times 08/06/2003

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Ministry to Expand Steps to Induce Foreign Technical Brains

The commerce, industry and energy ministry will expand preferential entry and departure treatment for foreigners working in information-technology and e-business fields, to include those in biotechnology, nanotechnology and four other sophisticated industries to induce foreign technical brains into the country. The ministry in consultations with the justice ministry will seek to expand the application of "Gold Card" system to foreigners who will work in the six industries. They are digital appliances, new materials, environment and energy and transportation machinery besides BT and NT. The ministry will set up a center in the Korea Industrial Technology Foundation that would provide a range of services regarding management of foreign technical personnel, including resolution of foreign workers' grievances, screening and issuance of Gold Cards, and building of a database for them. It also extended the income tax exemption by three years to the end of 2006. Since the introduction of Gold Cards in the IT and e-business areas in November 2000, a total of 178 foreigners benefited from them. They include 113 from India, 29 from Vietnam, 10 from Russia and nine from the United States.

From http://www.kois.go.kr/ 08/08/2003

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New Foreign Worker Employment System to Be Introduced

The National Assembly approved the "Law for the Employment of Alien Workers" on July 31, 2003, putting into effect a new "Employment Permission System" as of August 1, 2004. The new system comes as part of government efforts to improve the nation's foreign worker employment mechanism. The system is expected to fix some of the human rights and personnel management problems raised under the current Foreign Industrial Trainees System. However, the ministry of maritime affairs and fisheries said that the new law would not significantly affect its existing foreign sailor hiring system but be used concurrently with the old system. Specifically, the new system will not affect the deep-sea fishing industry, which has its own foreign workers employment regulations under the Seamen's Law. Currently 6,395 alien workers are working for the industry. But, off-shore fishing businesses are expected to choose and adopt the current Foreign Industrial Trainees System soon, the ministry said.

From http://www.kois.go.kr/ 08/13/2003

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INDONESIA: Immediate Land Reform is a Must

NGO activists have called on the government to address the increasing inequity between rich and poor farmers before the issue explodes into a social conflict. Henry Saragih, secretary-general of the Indonesian Farmers Federation (FSPI) and Usep Setiawan, Coordinator of the Working Group on Agrarian Reform and Natural Resources, said on Thursday that the minority rich farmers controlled 69 percent of farmlands in the country. The call came only a week after a bloody land dispute in Bulukumba, South Sulawesi, claimed six lives. The violence broke out when villagers ran amok during a protest of the alleged illegal occupation of their land in Bonto Mangiring, Bulukumba, by rubber plantation company PT London Sumatra. The police apparently shot the protesters in what they claimed was self-defense against farmers who tried to attack them with sharp tools. "Land reform is inevitable, but the government is not serious about it," Henry said. A 1993 survey by the Central Statistics Agency (BPS) showed that a total of 22.8 million farmers, or 84 percent of all farmers, controlled a plot of less than one hectare, and that 70 percent owned less than 0.5 hectares of land. In comparison, only 4.4 million farmers have more than one hectare of land, which accounts for 69 percent of the country's farmlands. In 2000, however, 80 percent of the country's farmers owned less than 0.5 hectares of land, said the Ministry of Agriculture. Henry said while most farmers were working very hard to own just 0.5 hectares of land, the government had allowed plantation, forestry and mining firms to hold concession areas of thousands to millions of hectares. Data from the Consortium for Agrarian Reform showed that as of 2000, 2,178 plantation firms controlled a total of 3.52 million hectares in concession areas. Usep said that without fair distribution of land, land disputes would be constant, and crime and environmental destruction would continue unchecked. President Megawati Soekarnoputri is set to present the performance of her administration today at the People's Consultative Assembly (MPR) Annual Session, including their land reform measures. In 2001, the MPR issued Decree No. IX/2001 on agrarian reform and natural resources management, which included reorganizing land ownership in the country. So far, the government has only issued Presidential Decree No. 34/2003 in May, instructing the National Land Agency (BPN) to speed up the review of the 1960 Agrarian Law. But Henry said a review of the Agrarian Law was not necessary, as it was good enough to ensure fair distribution of land. He said the Agrarian Law covered basic principles that respected indigenous land ownership, social functions, the protection of farmers' rights and conservation. "We need a decree that orders state institutions to review laws for specific sectors, like the Mining Law and the Forestry Law, which conflict with the Agrarian Law," he said. In order to realize land reform, the government should thus start purchasing land controlled by corporate firms and rich farmers, and not extend concession areas held by plantation, forestry and mining firms, Henry said. The government could then distribute the land fairly to poor farmers, he added. Usep said the House of Representatives and the government should establish a comprehensive land reform concept to ensure fair land distribution. (by Moch. N. Kurniawan)

From http://www.thejakartapost.com/ 08/01/2003

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MYANMAR: National Workshop on Development of Enabling Policies for Trade and Investment in the IT Sector Opened

The National Workshop on Development of Enabling Policies for Trade and Investment in the IT Sector, organized by the Directorate of Trade under the Ministry of Commerce and the United Nations Economic and Social Commission for Asia and the Pacific, was opened at the Traders Hotel on Sule Pagoda Road here this morning, with an address by Minister for Commerce Brig-Gen Pyi Sone. Present on the occasion were Minister for National Planning and Economic Development U Soe Tha, Ministers at the State Peace and Development Council Chairman's Office Brig-Gen Abel and Lt-Gen Min Thein, responsible personnel of the UNESCAP, directors-general and managing directors from the departments and enterprises under the Ministry of Commerce, departmental officials, personnel from the Myanmar Computer Federation and the Myanmar Computer Scientists Association, guests and representatives to the workshop.

From http://www3.itu.int/ 08/08/2003

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MALAYSIA: Move to License Financial Planners

Financial planners, seen as an important group of professionals in the banking landscape of the future, are likely to require licensing as investment advisers. Proposed amendments to the Securities Industry Act 1983 tabled in June include a provision that a person can call himself a financial planner only if he has an investment adviser's licence. The Securities Commission (SC) had a dialogue with financial planners earlier this week to update them on the latest developments, an SC spokesperson said in reply to queries from StarBiz. "Under the proposed amendment, any person who carries on a business of analysing the financial circumstances of another person and provides a plan to meet that person's financial needs and objectives, including any investment plan in securities, is considered an investment adviser. "That person would therefore require an investment adviser's licence," the spokesperson said, adding that the amendments were aimed at facilitating the developments in the financial planning industry. Apart from a licence, the financial planner must obtain the necessary qualifications and licence from other relevant authorities to provide services in areas under their jurisdictions, such as Bank Negara (if he intends to provide advisory services in insurance planning) and the Inland Revenue Board (for taxation advisory services). However, these requirements are not intended to replace those for people wishing to continue being sales agents for a particular product such as insurance or unit trusts. But they must not hold themselves out as financial planners, the SC spokesperson said. The SC is also reviewing the licensing guidelines and various qualifications within the financial planning industry in consultation with the relevant authorities, trade associations and practitioners. According to Financial Planning Association of Malaysia (FPAM) vice-president Steve Teoh, the association has been engaged in regular dialogues with the authorities and lately, the regulators have been trying to put in place some guidelines on how the industry should be regulated. "For example, this touches on who should be allowed to represent himself as a financial planner, and the necessary qualifications and experience as well as ethical rules that he must abide by ," he told StarBiz. In addition, the association is encouraging more people, especially those in the financial services industry, to become certified financial planners (CFP). FPAM is in the final stages of developing an Islamic financial planning module for the CFP exams. It is also planning to launch its own website this year. According to Teoh, the module, which is non-mandatory and would be launched by year's end, would enable CFP professionals to better render their services to the Islamic community. There are currently six modules in the CFP exams. Through the FPAM website to be launched by September, the public will be able to find out who the association's licensed CFP members are. FPAM is the licensee for the International CFP mark. It currently has 7,000 members, of whom more than 2,000 are licensed CFPs and the rest trade members (student members of CFP exams). Teoh said the association, which was formed in December 1999, was targeting a total of 3,000 CFPs by year-end. Globally, there are 75,000 CFPs. On the future role of financial planners, FPAM principal officer Lee Siew Hoong said bank customers were getting more sophisticated and their expectations were also getting higher; hence the need for professional advice on management of their finances. Bank staff who are CFP qualified would be in a better position to provide clients with comprehensive financial advice, Lee added. (by Yap Leng Kuen And Daljit Dhesi)

From http://biz.thestar.com.my/ 08/01/2003

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Penang Offers Expertise on Water Management

PENANG: Penang has offered to share its experience in water management to the Federal Government which will be taking over control of water supply in the peninsula. Chief Minister Tan Sri Dr Koh Tsu Koon said the state£r efficiency in water management was reflected in its water rates, which were the lowest in the country. He said the change in jurisdiction would mean some restructuring within the administration and operations of the Penang Water Supply Corporation Sdn Bhd (PBAPP), of which he is the chairman. He said the proposal would benefit the nation and the corporation, adding that it would promote a more integrated level of management. ¤‘he Penang government will still maintain a substantial equity, although the details of this aspect has yet to be discussed,? he told reporters after opening Tiens Health Development (M) Sdn Bhd£r Penang office in Jalan Sultan Ahmad Shah yesterday. On Wednesday, Works Minister Datuk Seri S. Samy Vellu announced that the Federal Government would soon take control of water facilities and operations from the states in the peninsula to ensure supply at all times. He said that the state governments had agreed to allow the Federal Government to be responsible for water supply as it would also make inter-state discussions easier. In Ipoh, State Infrastructure and Public Utilities Committee chairman Datuk Ong Ka Chuan said the state government accepted the Federal Government£r decision to take over its water supply. He said Perak was one of the states that had managed its water operations successfully. ¤”e have been consistently repaying our loans to the Federal Government and have been making an average profit of RM25mil per year in the last 10 years,? he said. Meanwhile, the Kelantan government has rejected the federal move to take over the state£r water resources and management. Mentri Besar Datuk Nik Abdul Aziz Nik Mat said he was shocked by Samy Vellu£r statement that all state governments had agreed to allow the federal takeover of water facilities and operations.

From http://202.186.86.35/ 08/01/2003

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Speeding Up Commercial Cases

KANGAR: The Chief Justice's office has set up a committee to look into expediting court procedures of commercial and civil litigation. The committee would be entrusted to ensure that all such cases could be heard within a year from filing. Chief Justice of Malaysia Tan Sri Ahmad Fairuz Sheikh Abdul Halim said the committee would also look into other bureaucratic shortcomings. It would shorten the legal process needed in clearing such cases and with a faster clearing rate, it would boost investors' confidence and help the country in its quest to boost the economy, he said. Ahmad Fairuz said he had also spoken to the judiciary and the Bar Council with regard to the importance of expediting such cases. "Both the judiciary and Bar Council understand the issue and will co-operate towards ensuring a faster hearing rate and clearing of cases," he said. "I think there is awareness on this matter among the legal fraternity. At times, cases are postponed or delayed because the lawyers are busy with cases in other courts. As such we must cut down on postponement." Citing an example, he said, in cases involving banks and bad debts, it was only fair for the case to be settled promptly so as not to hamper the bank's operations and in the long-term to boost the economic conditions for the country. Ahmad Fairuz said this after paying a courtesy call on the Regent of Perlis, Tuanku Syed Faizuddin Putra Tuanku Syed Sirajuddin Jamalullail, and the Raja Puan Muda of Perlis, Tuanku Lailatul Shahreen Khalil Akashah. He was accompanied by his wife Puan Seri Mazni Mohd Noor, Kangar Sessions Court Judge Ridwan Ibrahim and Special Officer to the Chief Justice, Ahmad Terrirudin Mohd Salleh. On another matter, Ahmad Fairuz directed judges to set up their own websites to serve the people better. He said to date, only the High Court in Sandakan (Sabah) had its own website, adding that the High Courts in Sungai Petani, Alor Star (Kedah) and Kangar (Perlis) were currently developing their websites which were expected to be ready by end of this year. Ahmad Fairuz said websites were necessary to enable the public to get profiles of the respective High Courts, case judgments and postponements. Ahmad Fairuz said currently, the Federal and Appeal Courts had their websites and all High Courts should be encouraged to hook up with the Malaysian judicial site (www.kehakiman.gov.my). (by Ian Mcintyre)

From http://202.186.86.35/ 08/12/2003

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Officers to Train at Britain Top Law Centre

LONDON: Senior Malaysian legal officers will be sent to Britain£r premier centre for research in the field of international law to gain greater exposure, Foreign Minister Datuk Seri Syed Hamid Albar said. Their stint at the Lauterpacht Research Centre for International Law at Cambridge University would also cover world trade issues, he said after presenting a cheque for ?00,000 (RM2.4mil) to the centre on Thursday. Two of the centre£r leading figures, Prof Sir Elihu Lauterpacht and Prof James Crawford, were part of the legal team that successfully argued the case for Malaysia in its dispute with Indonesia over the islands of Sipadan and Ligitan. For their work with Malaysia that stretched more than 10 years, both men were conferred the Panglima Jasa Negara, which carries the title of Datuk, this year. Syed Hamid said Prof Lauterpacht and Prof Crawford were now helping Malaysia prepare the case over the disputed sovereignty of Pulau Batu Besar, and provide legal opinion on Singapore£r reclamation of the Tebrau Straits. He said the first memo on Pulau Batu Besar was to be submitted to the International Court of Justice in The Hague, which is expected to hear the case in about three years. The centre, set up in 1983, is well known for its work in developing projects on major issues of international law, including humanitarian issues, the law of the environment and inter-state relationships. Besides Wisma Putra, Syed Hamid said legal officers from the Attorney-General£r Chambers, would also benefit from the tie-up with the centre. (by Tan Kah Peng)

From http://202.186.86.35/ 08/16/2003

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PHILIPPINES: SSS Opens Special Financing Facility for Small Enterprises

The Social Security System (SSS) has opened a special financing facility for small enterprises to support the barangay micro business program of the government which aims to spur the economic development of the country. President and Chief Executive Officer Corazon de la Paz said that under this new loan window, accredited barangay entrepreneurs could borrow funds for working capital, expansion of facilities or acquisition and upgrading of equipment. "The maximum term of the loan is 10 years," De la Paz said. "All SSSaccredited banks, including rural banks, are now accepting applications." Barangay micro business enterprises (BMBEs) refer to new or existing enterprises with total assets of not more than P3 million. The program, which is mandated by a new law, RA 9178, seeks to create employment and speed up the economic development of the country. Under RA 9178, registered BMBEs are exempted from income tax arising from its operations and the coverage of the minimum wage law. They can also get technical assistance from the Department of Trade and Industry and from skills and technology development agencies. De La Paz said micro-enterprises, especially in the countryside, could spur economic growth and the SSS will do its share in making this a reality. She said the BMBEs have been included in the SSS Special Financing Program which has an allocation of P2.5 billion, adding: "Each borrower can avail of up to P50 million."

From http://www.mb.com.ph/ 08/20/2003

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SINGAPORE: Wages Need to Be More Flexible and Tied to Performance

Singapore's wages need to be changed to keep the cost of doing business in the country competitive, says Prime Minister Goh Chok Tong. It's not just the CPF rate that needs to be cut, Mr Goh said, to lower costs and save jobs. He noted that wages in Singapore are too high, too much a part of the wages is fixed, and they are tied too closely to seniority so older workers earn much more than the younger ones for doing the same work. In contrast, many US companies reward on performance and hire and fire according to the company's needs. "Personally, I find this system ruthless. Workers are human beings. They have feelings and families. But I recognise that it is this ruthless pursuit of productivity and profit that makes American corporations unbeatable," said Mr Goh at his 13th National Day Rally. So, Singapore's wage model needs to be fixed. Seniority and loyalty, Mr Goh said, should still be rewarded but a larger part of wages must be linked to performance. But, this alone is not enough to keep older workers employed. "I urge employers: do not pass over workers simply because they are above 45. If older workers are prepared to adjust, give them a fair chance to prove themselves," PM Goh said. (by S Ramesh)

From http://www.channelnewsasia.com/ 08/17/2003

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INDIA: PM Promises Quota for Upper-Caste Poor

Prime Minister AB Vajpayee promised to introduce a constitutional amendment bill to grant reservations to the economically disadvantaged among the upper castes. The proposal, he said, was conditional on the support of political parties outside the NDA and the support of the opposition. Coming to a state that has just started recovering from a prolonged drought, Vajpayee began by talking about the scheme of linking rivers to end water shortage. He talked about the Centre's help to Rajasthan and the tendency among parties to play politics over natural calamities. Many people protested during the speech. The Social Justice Front (SJF), which was in the forefront of the agitation for these quotas, had vowed to disrupt the meeting. Vajpayee also spoke of the idea behind reservation - that of enabling the disadvantaged to compete on an equal footing -and said people wanted benefits for the poor among those who were not socially disadvantaged. "This demand has become strong particularly in Rajasthan. But doing it is a difficult task since it will require a constitutional amendment which has to be approved by two-thirds majority in Parliament," Vajpayee said. Since the NDA did not have the required strength, it would have to depend on opposition support. "If they lay their cards on the table and agree to this, we can introduce a Bill when the House sits next. But we should be guaranteed that the Bill will not be defeated," Vajpayee said. (by Rajesh Sinha)

From http://www.hindustantimes.com/ 08/10/2003

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Govt Toughens Stance Against Misuse of ISI Mark

NEW DELHI: Government is actively considering making penalties for manufacturers of fake drugs, medicines and other consumer products more harsh and stringent to deter dubious businessmen from misusing the ISI mark. A process to this effect had already been set in motion by Consumer Affairs Minister Sharad Yadav, who has directed the Bureau of Indian Standards (BIS) "to take up the issue on a priority basis". "It is felt that current penalties under Section 33 of the BIS Act are not harsh enough to deter unscruplous manufacturers from misusing ISI mark making it imperative that they are made even more stringent so that violators are dealt with effectively and decisively", Yadav said in an interview. He said the BIS had also been instructed to strengthen its enforcement wing, involve independent NGOs and other professionally qualified agencies in inspection of various product samples and make quality standards "dynamic" by timely review in tune with technological changes. There is no point in revising quality standards after a fixed time period of five years and instead the exercise should take place on a continuing basis depending on technological changes relating to manufacture and testing of product, he added. Nationwide raids last month involving 42 places in 15 states showed a number of manufacturers were using ISI mark on spurious products, action has now been initiated against them. Government is committed to maintain the sanctity of the ISI mark and penal provisions are being strengthened to this end, he added

From http://timesofindia.indiatimes.com/ 08/17/2003

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PAKISTAN: Public-Private Sectors Partnership Stressed

KARACHI: Punjab Governor Lt Gen (Retd) Khalid Maqbool has called upon the government and the private sector to join hands to root out poverty, which is hindering progress and development of the country. Addressing the members of the Federation of Pakistan Chambers of Commerce and Industry (FPCCI) at the Federation House on Saturday, he said that the World Trade Organization had offered opportunities and challenges, for which the government and the private sector would have to work together. He said that the services sector would have to provide various services at cheaper rates besides maintaining the quality standards. He said that another field in which the private sector and the government would have to work together was the provision of cheaper houses to general public. The governor called upon the businessmen and industrialists to become leaders in welfare of people and set up projects for education, health and skill development of the people, says a press release of the FPCCI. He said that the textile sector offered the biggest opportunities to compete in global economy. However, he added, "we will have to modernize our textile sector with sophisticated machinery and professionally skilled workforce." Mr Maqbool said that the jewellery and gemstone industry needed good designers and professional workforce to develop and compete in the world. The agro-based industry particularly dairy farming and off-season fruits and vegetables had tremendous opportunity for export, he added. Earlier, President FPCCI Riaz Ahmed Tata said that the business community did not require any undue support or subsidies from the government. "Only what it demands is a playing field against international producers and exporters supported by facilitating policies and operating systems," he said. He called upon the governor to use his influence in the federal cabinet to ensure urgent upgradation of human resources and technology for effective check on crimes and promotion of law and order throughout the country, particularly in Karachi. Meanwhile, Khalid Maqbool met Sindh Chief Minister Sardar Ali Mohammed Mahar at the Chief Minister House here on Saturday, adds APP. Expressing sympathies over the damages caused by heavy rains and flood in Sindh, the governor assured of full cooperation to the people of Punjab. Mr Maqbool told the chief minister that the chief minister of Punjab had already given Rs50 million towards Sindh Relief Fund, while he himself had come here to ascertain the requirements of the province. He inquired from the chief minister about the requirement of flour and other articles for the needy people of Sindh. He pledged that flour and other essential items would be immediately sent to the rain victims of Sindh. Sindh Chief Minister thanked the governor and the people of Punjab for their gesture.

From http://www.dawn.com/ 08/10/2003

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Ministers' Performance Reviewed

KARACHI: A meeting of the National Alliance (NA) Sindh was held to review of the performance of its ministers in the provincial government. According to a press release, a meeting of the parliamentary party of the Sindh NA was held under the chairmanship of its parliamentary leader and Sindh minister for works and services Dr Arbab Ghulam Rahim, at his residence here on Saturday. NA Sindh ministers assured on the occasion that the NA would play its due role in strengthening democracy. The meeting decided that a five-member committee comprising Ghulam Murtaza Khan Jatoi, Dr Arbab Ghulam Rahim, Nadir Akmal Laghari, Irfanullah Khan Marwat and Imtiaz Shaikh would meet the chief minister and work for solution of the problems of its parliamentary members. It was also decided that all the members of the parliamentary party of the National Alliance would meet the chief minister on Sunday. Minister for inter-provincial coordination Nadir Akmal Laghari, minister for population Imtiaz Shaikh, education minister Irfanullah Khan Marwat, deputy speaker Sindh Assembly Ms Raheela Tiwana, president of Sindh NA Ghulam Murtaza Khan Jatoi attended the meeting.-APP

From http://www.dawn.com/ 08/24/2003

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KAZAKHSTAN: Civil Forum to Take Place in Kazakhstan

When the Civil forum takes place in Kazakhstan it will help to activate NGO activities in the republic. This opinion was expressed by NGO representatives at a press conference on 12 August in Almaty. According to Inessa Frantz, director general of the Institute of Cooperation for the Development, today there are 2.5 thousand NGO in Almaty and Almaty oblast, of which only a half is active. In relation with this, the press conference participants observed, in order to develop the civil society in the republic it is time for coordinated activities between NGO themselves, as well as between these organisations and state authorities. Among the main problems to be resolved, the NGO representatives mentioned an improvement of legislation in this area, the state support for NGO activities, as well as an improvement of an efficient mechanism of cooperation between state authorities and non-commercial organisations, a dialogue between the society and the authority. It was decided to discuss all these issues for the sake of a stable development of the non-government sector of the country at the forthcoming Civil Forum due to take place in September in Astana with a participation of the president of RK Nursultan Nazarbayev.

From http://www.gazeta.kz/ 08/12/2003

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TAJIKISTAN: Training for Servicemen of Defense Ministry on De-Mining Methods Begins

Training for servicemen of the Tajik Defense Ministry on de-mining methods have been launched in Tajikistan. DUSHANBE, August 18, Asia-Plus - "Each de-activated mine - it is people saved from death or wounds", Mr. David Smith, Country Representative - operation officer of the Swiss non-government organization "Federation Suisse de Deminage", told Asia-Plus. According to him, under an agreement signed between the OSCE Center in Dushanbe and the Government of Tajikistan funds have been received and preparatory work has begun. "From Monday, August 18, we are beginning a training for a group of servicemen of engineer battalion of the Tajik Defense Ministry", continued the Asia-Plus interlocutor, "after the training these people will be engaged directly in de-mining operations". By the end of the current week, a team to be deployed to the Saghirdasht area for carrying out surveys will have been trained, and the second group will be trained during two weeks and then they will go to Saghirdasht and Tavildara. "This team will be trained in carrying out mine-clearance operations", Mr. Smith stressed telling difference between these two teams, "When they arrive in Saghirdasht and Tavildara, the first team will leave for Gharm, Tojikobod and Jirgatol". Speaking about features of carrying out de-mining operations in mountain areas the operation officer of the "Federation Suisse de Deminage" said that in connection with coming of winter season it was necessary to complete the first part of surveys before coming of cold weather. According to Mr. Smith, two small teams will have been working in the republic this year, and a draft proposal for 53 people, who will be engaged in carrying out surveys and mine-clearance operations, has been signed. Under the bilateral agreement, the teams will return to places of permanent stationing in November and they will stay there till the beginning of works next year. On the issues related to financial support and technical procurement, the Asia-Plus interlocutor says they have already received notification of sending special dresses for suppers to Tajikistan. They are supposed to arrive in Dushanbe by the end of the current week. He also pointed to the importance of close cooperation between the "Federation Suisse de Deminage" and recently established Center for Land-Mine Problems in Tajikistan. Asked about de-mining of the Tajik-Uzbek border Mr. Smith said that issue of clearing these sections of mines was also within the competence of the Federation. But before the de-mining operation is launched in this area the government of Tajikistan and Uzbekistan should delineate the common border.

From http://www.asiaplus.tajnet.com/ 08/18/2003

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U.S. Embassy Supports Democratic Initiatives in Tajikistan

The U.S. Embassy in Dushanbe is financing democratic initiatives in Tajikistan, and the U.S. Government will provide to the republic hepatitis vaccine. DUSHANBE, August 18, Asia-Plus - The U.S. Embassy in Dushanbe plans to provide to Tajikistan more than $ 56.,000 for supporting democratic initiatives. The allocated funds are directed to signing of grant contracts with 12 Tajik organizations. As Asia-Plus was told at the U.S. Embassy in Dushanbe among the recipients of grants are the following Tajikistan's non-government organizations: "Chashmai Hayot", "Benazir", "Youth and Civilization", Center for Protection and Cooperation (all these organizations are located in Sughd Province), "Bonuvoni Fardo", Women's Center "Malika" (both are based in Khatlon Province), League of Women-Lawyers and International Academy of World's Poetry. Besides, grants will be also awarded to some Tajik media - TV Station "Guli Bodom", "Sughd" newspaper, and "Guftugu" magazine. The U.S. Embassy noted that that action was a second part of a program for awarding small grants by the Commission for Democracy Development financed by the U.S. Government. The goal of this program having been working in Tajikistan since 2000 is in awarding small grants to non-government and non-profit organizations for implementing projects aimed at support for development of democratic institutions in the country. During a three-year work in Tajikistan 49 non-government and private organizations have received grants from the Commission for democracy Development for further development of democracy in Tajikistan. This year, a total amount of grants awarded by the Commission to Tajikistan will have amounted to $100,000. Meantime, as Asia-Plus was told at the U.S. Embassy in Dushanbe the United States will provide to Tajikistan 45,000 dozes of vaccine against hepatitis "B". This medical preparation had been purchased at request of the Tajik Ministry of Health for vaccinating medical against hepatitis "B" because they are at high risk to fall sick with this disease. We would recall that on August 20, the United States will launch in Tajikistan the first stage of the large humanitarian project formally titled "Operation Hope". A total cost of the project, which re[resents a special effort of the U.S. Government, military structures and public and private sectors, is $27 million. The following Wednesday, $16 million worth of assistance including mostly medicines and medical supplies provided by the U.S. pharmaceutical companies will be airlifted to Dushanbe.

From http://www.asiaplus.tajnet.com/ 08/18/2003

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AUSTRALIA: ACCC Ready to 'Out' Firms for Violating Codes of Conduct

New ACCC boss Graeme Samuel threatened yesterday to publicly "shame" businesses that failed to comply with industry codes of conduct endorsed by the competition watchdog. In a bid to improve business compliance with the Trade Practices Act and reduce regulatory costs, Mr Samuel has introduced a new system of voluntary industry codes which the Australian Competition and Consumer Commission would approve. Dubbing it "co-regulation", Mr Samuel told the Australian Industry Group Forum in Canberra that this system was a "halfway measure" between heavy-handed government regulation and industry self-regulation. He said voluntary codes benefited the Government, the regulator, industry and the consumer. "ACCC endorsement should provide the consumer with some reassurance that the business they are dealing with operates in a fair, ethical and lawful manner," Mr Samuel said. "ACCC endorsement will provide the business operator with a degree of confidence that they are applying best industry practice." He denied this system would merely allow businesses to "cosy up together" at the expense of the consumer. The ACCC will rely on consumer feedback and compliance audits to assess whether businesses are abiding by regulator-approved voluntary codes. Mr Samuel warned those industries caught flouting their code would be publicly outed and "shamed" and could have their codes "disendorsed" by the ACCC. "Endorsement from the commission will be hard to obtain and easy to lose," he said. The ACCC is discussing codes of conduct with 40 industry groups, including the cinemas, the retail grocery industry, the Australian Communications Industry Forum and the Furniture Industry Association. The regulator is also helping to review the Australian Direct Marketing Code and the Franchising Code. Mr Samuel called on other industry groups to work with the ACCC to develop their own codes. He said successful codes addressed consumer concerns, were transparent, outlined complaints handling procedures, included sanctions for non-compliance and were regularly reviewed for their effectiveness. The ACCC will only endorse a code once the industry has demonstrated the code is meeting its objectives. Industries will be able to advertise that their code has been approved by the ACCC. Mr Samuel said the competition watchdog would carry out its duties with "the same rigour and the same vigour" as it did under his predecessor, Allan Fels.

From http://www.smh.com.au/ 08/11/2003

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NEW ZEALAND: Auckland Regional Council to Review Rating System

The Auckland Regional Council has backed down over the rates revolt by promising a complete review of the rating system and help to people struggling to pay bills. The council says legal, technical and financial implications mean the review will not take place until next year, which leaves the region's 460,000 ratepayers stuck with this year's rates. The backdown came at an informal meeting by 10 of the 13 councillors yesterday. It followed 17 days of complaints by Aucklanders, ratepayer groups, local and national politicians shocked and angry at rates rises as high as 657 per cent. A spokesman for the regional ratepayers rebellion group, David Thornton, said the ARC was talking "complete twaddle" because it was duty bound to review the rates next year. "People are demanding action now. If the ARC does not give way now they will be battling their constituents right up to the next election," Mr Thornton said. The ARC gained a lot of support for an overall rates increase of 34 per cent to improve transport but drew condemnation by residents for the method of calculating rates. The decision to use capital value and not have a business differential resulted in household rates rising by 100 per cent or more and businesses paying less. ARC chairwoman Gwen Bull acknowledged concerns expressed by individual ratepayers and groups. Previously she had defended the rating system as the best and fairest and remained unmoved by the growing rebellion. "As a council we want to be solution-based and are committed to a complete review of our rating methods for the next rating period," Mrs Bull said yesterday. She still believed the ARC had the "fairest system" of rates, which had been complicated by some cities having big business differentials, some having revaluations and the ARC following all other regional councils to rate on capital value. "People are obviously upset out there and we want to work with the community. If they think it is unfair, they need to come and tell us why they think it is unfair. Let's sit down around the table and talk about what can be a fairer system," Mrs Bull said. Mrs Bull said first date for penalty payment next Wednesday was still valid at "this moment". Meanwhile, at least 14 Auckland MPs from Labour, National, New Zealand First, Act and United Future are expected to attend a meeting called by North Shore Mayor George Wood to discuss the ARC rating issue.

From http://www.stuff.co.nz/ 08/01/2003

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Ministry Focuses on Fraud Prevention, Spokesman Says

The Social Development Ministry is detecting less benefit fraud now than it was three years ago because of a new focus on prevention, a government spokesman said yesterday. ACT MP Muriel Newman has accused the ministry of going soft on fraud, comparing its $86 million catch in 1999-2000 with the latest figure of $42 million. "The number of inspectors has dropped, the number of people in the benefit control unit is at an historical low," she said. "They haven't got the will to go out there and do it." Social Development Minister Steve Maharey's spokesman, Michael Gibbs, said the unit had been significantly reorganised since the change of government in 1999. "The point the minister has made regularly is that the reason we're not recovering as much money is that we're preventing fraud from occurring in the first place," he said. "The Government takes a very firm line on fraud and does not accept it for one second." Dr Newman has written to Parliament's social services select committee - which audits the ministry - asking for a briefing from Mr Maharey, ministry chief executive Peter Hughes and the Audit Office. "It must be determined just how robust the systems used to prevent fraud really are," she said. The ministry has also had problems with staff offences, and during the past three years 43 have been caught committing fraud totalling $729,422. In the latest case, revealed earlier this week, a female worker is alleged to have defrauded the ministry of $1.9 million.

From http://www.stuff.co.nz/ 08/09/2003

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Govt Sets Up Integrated Approach to Work-Life Balance

The Government is setting up an inter-agency steering group to co-ordinate policies that promote a work-life balance, Labour Minister Margaret Wilson said today. The group would ensure research and policy development being carried out on the issue by a number of government agencies was co-ordinated. It would be chaired by the Department of Labour, Ms Wilson said. Work-life is about the interaction between paid work and other activities, including unpaid work in families and the community, leisure and personal development. Work-life balance practices and policies could help improve individual well-being and allow people to more fully use their potential in and outside work, Ms Wilson said. "The right balance between work and 'life' is different for each person," she said. "What is important is the extent to which people have real choices and control over their circumstances. "What is also clear is that achieving work-life balance is complicated, and will therefore require different government, employer, individual and community responses." The Government stated in the Speech from the Throne - which outlined its plans when it took power - that work was one dimension of life. Work should not crowd out and distort family life, recreation and personal development, Prime Minister Helen Clark said in the speech. The steering group would also co-ordinate public consultation, due to take place from October to December. Its brief is to develop policy options that provide increased opportunities for people to enjoy access to work-life balance. It will identify and advise on intended and possible unintended outcomes of the policy. It will have particular regard to low income families, those in casual, non-standard, precarious work, sole parents, carers and those who given wider choices may change their "productive activities". It will recognise, utilise and integrate any current labour market arrangements, social development or other government policies, management practices, and family and community activities. It will give consideration to the establishment of monitoring and evaluation of work-life balance options. It will report to the Government on options. Ms Wilson was expected in April or May next year to report on findings, and give advice on policy responses.

From http://www.stuff.co.nz/ 08/19/2003

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UNDP Report Ranks Pacific Island Nations

THE UNDP has issued it's human development report, which sees some South Pacific Island Nations ranked with sub-Saharan Africa and Central Asia. Fiji is ranked 81 out of 175 countries, with Solomon Islands at 123, Vanuatu 128, and Papua New Guinea at 132. The ranking is based on each country's ability to provide a long and healthy life as measured by life expectancy at birth, literacy and school enrolment rates and standard of living (GDP) for its citizens. The report identifies 31 top priority and 28 high priority countries where urgent action is needed to meet a Millennium Goal, referring to a minimum standards relating to health, education, gender equality and the environment agreed upon at the 2000 Millennium Summit. Four Pacific Island nations fall into the category of top priority: Vanuatu, Solomon Islands, Federated States of Micronesia, and Marshall Islands. The majority of the remainder are in Sub-Saharan Africa and Central Asia. - The Daily Post/PINA Nius

From http://www.pacificislands.cc/ 08/04/2003

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Expert Group Meeting on Regional Roadmap Towards Information Society for Asia and the Pacific and Fifth Regional Interagency Working Group Meeting on ICTUNCC, Bangkok, 13-15 August 2003

Despite its limitless potential, Information and Communication Technology (ICT) is still not being fully utilized to benefit humanity, according to ICT experts at a regional United Nations meeting in Bangkok this week. Delegates at the Expert Group Meeting (EGM) on Regional Roadmap towards Information Society for Asia and the Pacific (13-15 August) expressed deep concern over the lack of access that many developing countries have to new technology and the increasing gap between the digital 'haves' and 'have-nots'. Mr. Kim Hak-Su, Executive-Secretary of the UN Economic and Social Commission for Asia and the Pacific (UNESCAP), said the quality of life for many people in the Asia-Pacific region was suffering due to the unequal distribution of technology. "ICT has a great potential to facilitate the achievement of the United Nations' Millennium Development Goals, particularly, to combat poverty, hunger, disease, illiteracy, environment degradation and gender inequality. "Yet, despite significant efforts at the national and regional levels, we are still very far from ensuring that the benefits of ICT are available to all in Asia and the Pacific. This is partly because the Digital Divide is a reflection of the economic and social divides of poverty, illiteracy, and access to health care," he said. Over 60 senior government representatives, ICT experts, members of telecommunications groups and representatives of regional and global organizations attended the meeting, jointly organized by UNESCAP, Asia Pacific Telecommunity (APT), and the International Telecommunications Union (ITU). The group was optimistic about the prospect of ICT development, and said progress could be made through concrete cross-country strategies despite the lack of regional infrastructure, education, investment, technology and connectivity. "How we can bridge or narrow the digital divide, and create digital opportunities by providing equitable, affordable and universal access to ICT to all in the region is a real challenge for us," said Mr. Kim. "Towards that end, concerted efforts must be made at the national, regional and global levels, to enhance cooperation, and share relevant and timely information and knowledge towards the creation of the information and knowledge-based society in the region." The delegates met to take stock of the current regional ICT initiatives, such as the Tokyo Declaration (2003) and the Bishkek Declaration, and to translate them into a regional "roadmap" with achievable benchmarks that will ultimately bridge the digital divide. Key recommendations include; promoting private sector investment in ICT development, establishing technology training for the workforce, and using ICT in delivering public services like health and education. The delegates were also concerned with boosting public confidence in ICT by creating comprehensive data and information security, and encouraging ICT competition in developing countries. The Expert Group Meeting on Regional Roadmap towards Information Society for Asia and the Pacific and Fifth Regional Interagency Working Group Meeting on ICT was part of the preparatory process ahead of the World Summit on the Information Society (WSIS) in Geneva in December 2003, and Tunis in November 2005.

From http://www.unescap.org/ 08/14/2003

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Asia Looks to China for Growth

Almost one-third of companies in Asia are looking to China to fuel their expansion plans, a survey has found. According to the second part of the Far Eastern Economic Review's eighth Managing In Asia survey, of the 2,924 responses, nearly one in three said ``their companies are opening or planning to open operations in China soon''. That figure is significantly higher for Hong Kong at 43 per cent. At the opposite end of the spectrum, the number of companies which shut down a domestic operation was small with Hong Kong at around 10 per cent. Australia led with 15 per cent. Those already with some business in China topped 57 per cent in Malaysia, with Singapore and Hong Kong tied for second place at about 55 per cent. The survey also found that the financial hubs of Hong Kong, Singapore and Japan were home to the executives with the highest net worth. The favoured investments in Malaysia, Singapore and Hong Kong were unit trusts while Australians and South Koreans were keen on property, a sector out of favour in Japan and Hong Kong. As for investment tips, about 45 per cent of respondents fell for equities followed by property at around 37 per cent. Their favourite brokers? Citibank and HSBC. Still, respondents generally agreed the greatest challenge ahead was tackling the poor economy. Executives also found dealing with falling prices and the Sars outbreak major headaches. Their main priorities were getting suppliers to reduce their costs, implementing a system of rewarding staff based on performance while freezing salaries and boosting investment in staff training. Not surprisingly, the SAR topped the list of companies reporting a pay freeze at 60 per cent, followed by Singapore at 45 per cent. More than half of the local respondents also said they would move towards a pay-for-performance system while 65 per cent said they would pressure their vendors to lower costs this year. Unfortunately, Hong Kong was the least willing to invest in staff training at 35 per cent. The survey found Japanese executives had the biggest budgets to work with, averaging US$1.08 million (HK$8.42 million), with Hong Kong a close second. Those in Malaysia were allowed only US$780,000. (by Dennis Eng)

From http://www.thestandard.com.hk/ 08/16/2003

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Asian Governments Urged to Fight AIDS

Asian governments have been urged to make condoms cheaper and more accessible in the global fight against AIDS. Health officials from eight Asian countries are meeting in the Lao capital, Vientiane, to discuss HIV prevention in the commercial sex industry, which accounts for many infections in Asia. A World Health Organisation official has told the conference it is possible to turn the AIDS epidemic around if governments help fight the disease. Health specialists estimate the Asia Pacific region is home to 7 million people living with HIV, and could account for 40 per cent of new global infections by 2010 if prevention efforts are not stepped up. HIV infection rates are climbing in China, and infections among sex workers in Vietnam's two main cities are also on the rise. Thailand and Cambodia are the only two Asian countries where HIV infection rates are on the decline.

From http://www.goasiapacific.com/ 08/18/2003

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Demographic Changes Challenge Asia's Education Policies, Says ADB's Key Indicators

BANGKOK, THAILAND - Most of Asia's developing economies (ADEs) are in the midst of a demographic transition from high to low mortality and fertility. Education policies will play a crucial role if they are to reap economic benefits from this trend, but they also represent a considerable challenge, particularly for the poorest countries. This is a key message of the Asian Development Bank's (ADB) Key Indicators (KI) 2003 launched here today. KI, ADB's annual statistical databook on economic, financial, and other social indicators, includes a special chapter that analyzes the region's education trends. "With improvement in public health and nutrition, more children survive and women respond - with some delay - by reducing their fertility," KI points out. During the transition, as mortality drops but fertility remains high, a large generation of "baby boomers" is created. In this first phase of the transition, the young population increases, as does demand for education. It is critical, therefore, for ADEs to address and finance this challenge in a proactive manner. In the second phase, baby boomers enter the adult labor market, which, if it is able to absorb them, results in a productivity gain and economic expansion. This phase, when the proportion of working-age population is highest and age dependency ratios lowest, offers a "demographic dividend". Governments should create certain conditions to take full advantage of this opportunity, asserts KI. "One is to assure that the boomers will constitute an educated and productive labor force that will be absorbed by the labor market," says KI. The East Asian economic miracle was largely determined by the availability of educated people plus the dynamic industrial activities to absorb them. The drop in both mortality and fertility rates will result in wide disparities among countries in the school-age population over the next two decades. In some countries -notably the poorest- where a fertility decrease will follow low mortality with a significant time lag, the population aged 6-17 will increase substantially. For example, it will double in Afghanistan, increase by more than 50% in Bhutan, Maldives, and Pakistan, by more than 30% in Cambodia, Lao PDR, Nepal, and Solomon Islands. In contrast, it will rise only 3% in India. However, the population aged 6-17 will significantly drop in countries where low mortality and low fertility take place at the same time. It will decrease by 18% in People's Republic of China, and by 30% or more in Kazakhstan, the Republic of Korea, and Singapore. "These demographic dynamics have important implications for education policy," says KI. For ADEs where the number of young people is falling, the challenges are less about the supply of infrastructure and more about improving the quality of education and expanding access to tertiary education, adult skill development, and using the latest technologies. These countries are well positioned to take advantage of globalization in their efforts to catch up with industrialized economies. On the other hand, "ADEs with rising numbers of school-age children face more varied challenges. These include the need to expedite improvements in primary and secondary school curricula, while infrastructure demands will continue to be pressing." In South Asia in particular, the challenge of meeting the "Education for All" target over the next 15 years under the Millennium Development Goals is formidable, as rising populations increase demands on already over-burdened systems.

From http://www.adb.org/ 08/19/2003

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Health Experts to Gather in Vietnam in Oct to Deal with SARS Recurrence

Health experts from around the world will gather in Vietnam in October to examine their response to the recent global SARS crisis and draw up measures to deal with any recurrence, officials said on Wednesday. The two-day conference will take place in Hanoi from October 20-21 and will involve around 150 delegates, an official from the Vietnamese health ministry's external relations department said. Government officials and disease experts from Southeast Asia, as well as from China, South Korea, Japan, Canada, France and the United States are expected to take part in the meeting. Representatives from the World Health Organization (WHO), which marshalled the fight to contain the killer virus, and from pharmaceutical companies battling to develop a SARS vaccine are also due to attend. "The ministry is currently making preparations for the conference which will look at the lessons and challenges of SARS," the official said. Severe Acute Respiratory Syndrome (SARS) emerged in south China's Guangdong province late last year, and quickly spread to become a global menace. It struck down more than 8,000 people and left more than 800 dead in 32 countries, with some 349 of the fatalities and 5,327 of the infections recorded in China. The WHO has warned that SARS could strike again and has cautioned against countries lowering their guard. Last week an international group of experts converged on Guangdong to study links between the virus and animals amid fears that it could reappear as winter approaches. Scientists have said viruses carried by wildlife in the province are nearly identical to the coronavirus responsible for the disease. But a final conclusion on which animal -- or indeed whether it was an animal at all -- was responsible for transmitting it to humans has not been made despite months of investigations. Vietnam was one of the first to be infected with the virus, and on April 28 it was the first country to be removed from the WHO's list of areas with local transmission of SARS. Five people died from the virus in the country out of 63 infected.

From http://www.channelnewsasia.com/ 08/20/2003

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Transitional Challenges in Southeast Asia: News Analysis

Between now and February 2005, Southeast Asia will experience a series of important democratic and transitional changes, which could affect the political stability of the Association of Southeast Asian Nations (ASEAN). In the next 18 months, there will be landmark elections in Indonesia, the Philippines, Malaysia and Thailand and possibly a political transition in Singapore. In Malaysia, Prime Minister Dr Mahathir Mohamad will be stepping down in October, after the Organization of Islamic Conference (OIC) Summit in Kuala Lumpur. Dr Mahathir will retire from politics after being at the helm of his country for almost 23 years; his successor, Dr Abdullah Badawi is scheduled to take over and lead the country into general elections within the next 12 months, as Malaysia is constitutionally required to hold elections before November 2004. According to political analysts, the elections could come as early as the first quarter of next year, as the country continues to experience an economic boom. The Malaysian economy should grow by at least 5 per cent this year. The main challenge for Abdullah will be to successfully "recover" the Malay vote, which conspicuously deserted the ruling Malay party and coalition in 1999, following the saga of disgraced former Deputy Prime Minister Anwar Ibrahim. Now that political controversies within the Malaysian Chinese Association, Malaysia's principal Chinese party, have also been resolved, there is every likelihood of seeing solid Malaysian Chinese support for Abdullah and the ruling coalition next year. Abdullah's ability to mobilize substantial political support from all the different races will be key to his own political consolidation after the elections. The year 2004 will be a crucial political year for Indonesia, which will hold two landmark elections in the year. There will be legislative elections in April, followed by two rounds of presidential elections, most probably in August and October. Next year will in fact be the first time that Indonesia holds presidential elections via direct universal suffrage, thanks to Indonesia's crucially important post-Suharto constitutional amendment. The importance of such elections in Indonesia is connected to the ability to maintain stability in this vast country, which faces enormous economic, financial and social strains, as well as the threat of terrorism and potential political instability. Key to these elections will be the future place of political Islam in Indonesia and a new consensus on the role of Islam in Indonesian society, especially the demand by radical Muslim groups to impose the shariah or Islamic law on the country. Obviously, this issue would also be linked to the Jakarta authorities' fight against terrorism, as the latest bomb blast at the Marriott in Jakarta has again shown. President Megawati Sukarnoputri is seeking election against a myriad of contenders from across both the Muslim and secular political spectrum, and her victory cannot be taken for granted, although she appears to be the best placed candidate at this point in time. Megawati has given a dose of stability to Indonesia so far, but many are looking to her to bring further economic impetus and social stability to Indonesia as well. After the recent military mutiny in Makati, in central Manila, the Philippines is entering a period of political campaigning prior to the presidential and congressional elections next April. In fact, the short-lived military mutiny of 300 young officers highlighted the fragility of the Philippine political and democratic system, especially when many of the population and elected officials sympathized openly with the rebel soldiers. This mood of uncertainty was aggravated by the announcement some months ago that President Gloria Macapagal Arroyo would not seek re-election next year; however, there appears to be some hesitation in her stance lately. Moreover, the Philippines faces a threat of continuous instability as cronies of past regimes (from Ferdinand Marcos to Joseph Estrada) are still trying openly to overthrow the present administration, as the latest mutiny has also apparently proven. As the country openly engages itself in political campaigning in the coming months, there are worries that the Philippine economy could falter as political jostling and uncertainties increase. On the other hand, Prime Minister Thaksin Shinawatra of Thailand is probably the most secure in political terms today amongst his Southeast Asian peers, as Thailand looks forward to legislative elections in February 2005. After having built a powerful party and political coalition, centred around his Thai Rath Thai (TRT) Party, the Thai PM has successfully advocated strong economic nationalism, based on boosting domestic consumption and demand. The Thai economy is strong and sound, and economists today project a 5-6 per cent economic growth rate for 2003; national confidence is buoyant, especially after Thailand successfully paid back its IMF loan last month, two years ahead of schedule. This "feel good" sentiment should help garner impressive political support for Thaksin in February 2005, as political, economic and social stability continue in Thailand. There could also be a political transition in Singapore next year. Although Singapore's general elections are not due till late 2006 or the beginning of 2007, Prime Minister Goh Chok Tong officially announced during the National Day Rally on August 17 that he would step down before 2005 and let his deputy, BG Lee Hsien Loong, take over as Prime Minister for two years before leading the People's Action Party (PAP) into the next general elections. There could be democratic or transitional changes and challenges in all the five original members of ASEAN within the next 18 months. Undoubtedly, this period will be crucial to the cohesion and continuous development of ASEAN, as political stability in Southeast Asia will undoubtedly be at the forefront of concern for the whole Asia-Pacific and East Asian region.

From http://english.peopledaily.com.cn/ 08/21/2003

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CHINA: IT Growth Bullish

Despite a hiccup caused by the severe acute respiratory syndrome in the first half of the year, China's information industry development will continue to stay on track, said a leading Chinese industry consulting firm. The country's information sector will expand at an annual rate of 17.4 percent by 2007 to hit sales of 523.4 billion yuan (US$63.06 billion), said CCID Consulting Co Ltd. By that time, China will have a mobile user population of 500 million, while 100 million Chinese will surf the Internet with broadband connections. More than 20 million desktops will be sold here and the domestic laptop sales will hit 4 million annually. All these figures will more than double the current level in China. The best prospect offered by the Chinese IT industry is in the information service sector, said Huang Yong, executive director of CCID Consulting. "In the first half of this year, this sector generated 7 billion yuan in revenue, and it will keep a 24.1 percent annual growth to hit more than 100 billion yuan in 2007," he said. "If any investors ask us which areas they should pay attention to, definitely this is our suggestion." The most powerful driving factor behind it is the explosive growth of broadband deployment in China. In the middle of this year, 7.14 million Internet users on the Chinese mainland subscribed to high-speed Internet access service, almost three times the figure of a year ago. One surprise in the CCID report is the firm's pessimism of China's mobile phone market, saying the sales of handsets will remain flat, with only 0.4 percent annual growth rate in the following five years. In the first six months, 28.9 million handsets were sold in China, 0.7 percent fewer than a year ago. The value of handsets sold also dropped 2.1 percent to 48.68 billion yuan. This year might also be remembered as a tough time for local information technology firms, especially for computer makers. As SARS affected individual and corporate purchasing, the sales of personal computers swung from 100 percent year-on-year growth in the first quarter to a 10 percent slide in the second quarter. The sales of database, corporation management systems and information security programs also suffered decline.

From China Daily 08/06/2003

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Two-city Trade Zone Proposed

A team of senior Beijing officials will return to the capital at the weekend with a proposal for a Hong Kong-Shenzhen free trade zone that is already being dubbed ``one metropolis, two cities''. The proposal, one of several ideas for promoting greater integration between the neighbouring cities after the newly signed Hong Kong-mainland trade pact takes effect, calls for scrapping of customs checks at the border, although immigration checks would remain. The so-called second border, that separates the Shenzen special economic zone from the rest of the city, would then become the frontier for passage of goods from Hong Kong to the mainland. The scheme is in line with an economic plan put to the Guangdong government recently that sees Hong Kong and Shenzhen as one of two ``great metropolitan rings'' - with another formed by Guangzhou-Foshan - to speed up development of the Pearl River Delta. The State Council team, including senior officials of several ministries, has spent 10 days in Shenzhen reviewing closer ties between the SEZ and Hong Kong after the Closer Economic Partnership Arrangement (Cepa), kicks off on January 1. The Guangzhou Metropolis News reported yesterday that the team arrived on July 29 and would leave this weekend. It said the visit was an indication of Beijing's desire to reposition Shenzhen whose pioneering economic role was being overtaken by other mainland developments. Premier Wen Jiabao decided to send the team after visiting Shenzhen in July, following his trip to Hong Kong for the handover anniversary. The officials said other issues under review included whether the special economic zone policy, launched by former leader Deng Xiaoping to spearhead China's modernisation, should continue and whether the two parts of Shenzhen should be merged. The newspaper said the team had been engaged mainly in fact-finding but some members had ``strongly hinted'' the Central Government would support any feasible measures to promote Shenzhen's development. Shenzhen has gradually lost its advantages as an SEZ as the entire mainland opens up. There are hopes that Cepa will mean a new direction for the city's development in the face of fierce competition from elsewhere, Shanghai in particular. The ``two rings'' idea was put forward in July by Shenzhen Academy of Social Sciences president Yue Zheng and was said to have won the support of social and economic development experts in Guangdong. Shenzhen's future lay not on its own but in its integration with Hong Kong, Yue suggested. (by Wu Zhong)

From http://www.thestandard.com.hk/ 08/09/2003

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Haidian District Pioneers in E-government Development

A pilot experiment for e-government solutions based on network computer (NC) architecture passed expert appraisals on Sunday in Beijing, indicating the possible large-scale implementation of NCs in China's e-government development in the future. The Haidian District government, with the co-ordination of the Beijing University of Aeronautics and Astronautics, has achieved great success in the pilot project with the support of the nationally recognized 863 High-Tech Project, said Xing Zhiguo, vice-head of the district government, at a press conference. NCs promise enhanced security, easier management and lower costs, which curtail the government's expenditures in computers and boast considerable significance to the nation's e-government construction, he added. Last year, the Beijing municipal government had envisioned implementing an NC industrialization plan, and has since decided to increase the share of NCs in its procurements in the future, officials said. Different from personal computer (PC) architecture, all data storage, application storage and significant computing functions take place on centralized servers rather than hard discs under the NC architecture. The pilot program will fully enable NCs to serve as the terminal servers to deal with government e-business, including data, text and multi-media information processing, said Huai Jinpeng, vice-president and professor of the university. Having achieved success at the pilot level, Huai said he believed the NC architecture-based solutions could be applied in the field of e-commerce since there are great similarities between e-commerce and e-government in dealing with business and information. With self-owned intellectual property rights (IPRs), the domestically manufactured NCs will help break the dominance of Windows operating systems and Intel's CPU architecture, said Ni Guangnan, professor with the Institute of Computing under the Chinese Academy of Sciences (CAS).

From China Daily 08/12/2003

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Online Business Hits Record

The Industrial and Commercial Bank of China said on Monday its Internet banking turnover hit a record high last month on the back of a surge that started during the SARS outbreak. Online transactions at China's largest commercial bank totalled 2.06 trillion yuan (US$248 billion) in July, dwarfing a historic high of 1.5 trillion yuan (US$180 billion) that was recorded in June, the banks aid in a press release. The strong volume rise was attributed to a jump in the number of online corporate clients, which was fueled in recent months by fears about the SARS outbreak. The number of corporate clients was 18,400 at the end of June, an increase of 130 per cent from the same period last year.

From China Daily 08/13/2003

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Investment in Southern Taiwan Science Park Exceeds Us$32 Bln

TAINAN - A total of 112 manufacturers have received approval to invest in the Southern Taiwan Science-based Industrial Park in Tainan so far this year, with investments worth NT$1.114 trillion (US$32 billion). Among the 112 companies, 46 have already begun production. Statistics from the park also showed that the combined sales of the companies in the park reached NT$60.87 billion in the first half of this year, an increase of 25 per cent over the same period in 2002.

From http://www.asiapulse.com/ 08/15/2003

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Nine Provinces Plan Vast Economic Zone

Guangdong and its neighbouring provinces are planning a Pan-Pearl River Delta economic zone, which experts say will enable these areas to derive greater benefits from the mainland-Hong Kong Closer Economic Partnership Arrangement (CEPA). The region would include Guangdong, Hunan, Fujian, Jiangxi, Hainan, Sichuan, Yunnan and Guizhou, and Guangxi Zhuang Autonomous Region. Last weekend, the directors of economic planning departments of these provinces gathered in Guangzhou to urge support for their proposal with the co-operation of Hong Kong and Macao. At the meeting, now being seen as the first step towards the creation of a wider economic area, the participants agreed that a co-operation mechanism should be established, and pledged to share resources, according to a report from Xinhua News Agency. The gathering came in the wake of the sixth meeting of Hong Kong-Guangdong Co-operation Joint Conference on August 5, at which it was resolved to transform the Greater Pearl River Delta (PRD) area into the most vibrant and competitive economic zone in the world within the CEPA framework. Sources said the economic officials of these provinces would convene every year. A forum on regional economic co-operation is expected to be held later this year or next. Zhong Yangsheng, vice-governor of Guangdong, said CEPA created economic opportunities for Guangdong and its neighbours. He believes that there are great prospects for co-operation in the region, which is home to 446 million people, and with a land area of 1.99 million square kilometres. Experts say the Pan-Pearl River Delta plan comes at a time when Guangdong's neighbouring provinces are looking for a regional dragon head to lead an economic take-off, while Guangdong and Hong Kong are looking north to the vast domestic market. In the past, the export-oriented Guangdong economy overlooked the potential of the domestic market. In reality, Guangdong complements the neighbouring provinces and autonomous region. Guangdong has advantages in terms of capital, information technology and a huge market, while the neighbouring areas are rich in natural and human resources. Guangdong is now shifting its attention to the hinterlands, seeking co-operation with neighbouring provinces in transport, energy and tourism. Statistics show that since 1995, Guangdong has signed more than 8,000 economic and technological co-operation projects with neighbouring provinces, and autonomous region. The contracts are valued at 550 billion yuan (US$66 billion). However, co-operation on this scale is being seen as inadequate. Yang Kaizhong, a professor with Peking University, urged Guangdong to follow a "go north" strategy in its future development. He said even the Yangtze River region, especially Hunan Province and part of Hubei Province, should be the hinterland of the PRD. Chen Zuhuang, with the policy research office of the Guangdong Party committee, said the concept of a Greater Pearl River Delta was not sufficient to ensure long-term development of Guangdong and Hong Kong. He proposed extending the Greater PRD into a Southern China Economic Co-operation Zone by amalgamating neighbouring areas. Such a zone should be developed into the core area of the China-ASEAN (Association of Southeast Asian Nations) free trade zone, he said.

From China Daily 08/15/2003

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Nearly 50 Pct of Taiwanese Use Broad-Band Internet Connection

TAIPEI - Nearly half the population of Taiwan uses a broadband connection to surf the Internet, according to a survey released Monday. The results of the survey conducted by Taiwan Network Information Center in July showed that the number of people who used the Internet totaled 11.75 million as of July, accounting for 57.23 per cent of Taiwan's population. Of this figure, 9.37 million people had broadband connections, with 30 per cent of the households which have not yet been connected to the Internet saying they would be hooked up within the next six months.

From http://www.asiapulse.com/ 08/18/2003

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China to Launch Nationwide Health Services Survey

China plans to launch a nationwide survey of health services from Sept. 18 to Oct. 20 this year, according to the Ministry of Health Monday. The sample survey will cover the health situation of people interviewed, their requirements for health services, the actual use of the services and the factors affecting such use. Health officials said the survey is expected to be conducted at the homes of selected people or through group discussions with people who will be asked about their views on health service reform, and the situation of the medical services for people in need and the migrant population. Unlike the first two national health services surveys, which were conducted in 1993 and 1998, respectively, the upcoming survey will cover the vast western part of the country for the first time. The officials noted that information gathered from the survey will be useful for the central government to formulate policies concerning the health services and health reform.

From Xinhua News Agency 08/19/2003

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New List of Top 500 Chinese Firms Announced

An updated list of China's top 500 enterprises was announced at the weekend, with over 100 new arrivals included. The China National Petroleum Corp took first place thanks to its turnover of US$45.8 billion last year. The corporation is the world's ninth-biggest petroleum company and was third in last year's Chinese list. Oil company Sinopec remained in second place and phone company China Mobile moved up from sixth place to third. The top 500 list was included in the Report on the Development of Chinese Enterprises published at the weekend by the China Enterprise Confederation. The voluminous annual report also analyses a wide range of topics, such as foreign companies in China, the reform of State-owned enterprises, company management and China's entrepreneurs. The China National Petroleum Corp is ranked 69 on the global list of Fortune Global 500 companies. The report said State-owned companies account for 73.6 per cent of the national top 500 list. Only 69 private enterprises appear on the list. Hu Xinhuan, deputy general director of the China Enterprise Confederation, said China had only three enterprises on the world top 500 in 1995 but the number increased to 12 last year. He said Chinese enterprises have made rapid progress in sharpening their competitiveness. But China's enterprises are still small in scale compared with international giants, according to a confederation report. For example, the volume of business of the China National Petroleum Corp accounted for only 18.58 per cent of Wal-Mart, the US-based international retailer and the world's largest company. The last company on China's top 500 list -- the Ningbo Port Management Corp based in East China's Zhejiang Province -- earned only 2.94 per cent of the turnover secured by the Japanese company Kawasaki, the last on world top 500 list. Ma Fucai, general manager of the China National Petroleum Corp, said his company is focusing on building itself into a much more competitive multinational corporation. Other Chinese enterprises are working towards similar goals, thanks partly to the government's decision to develop between 30 and 50 State-owned companies into firms that can compete with international giants. Shao Ning, vice-chairman of the State-owned Assets Supervision and Administration Commission, said: "We still need time to achieve this goal.'' The commission, a newly established government department under the State Council, is the owner of billions of US dollars worth of Chinese State assets. He said the State-owned firms would undergo further reform "soon.'' He did not go into details but said the government will try every means to "make them really market-oriented.'' Zhang Yanning, vice-chairman of the China Enterprise Directors Association, has suggested that Chinese enterprises should stress core competitiveness, efficient management of human resources and brand strategies. Of 100 world-famous brands named in the US-based magazine BusinessWeek last year, six were from Asia but none of them were from China. Researchers and economists have also urged more measures to be introduced to encourage China's private enterprises to improve their core strength.

From http://english.peopledaily.com.cn/ 08/25/2003

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JAPAN: Broadband Users Reach 10.9 M

Japan's overall broadband users have crossed the 10 millionth user mark for the first time, thanks to a surge in fiber-to-the-home subscription. Broadband lines grew by 450,638 for the month of June, bringing the total number to 10.9 miilion for the first half of the year, stated the report released by Japan's Ministry of Public Management, Home Affairs, Posts and Telecommunications. According to the report by NE Asia Online, the sluggish growth of digital subscriber lines (xDSL) led to a reduced growth for the month of June, down from May's 520,000. The total number of subscribers for fiber-to-the-home (FTTH) services rose by 60,000 in June to 458,293, up from May and April, while cable TV Internet subscribers increased by 41,000 in June to 2.2 million. In a report published by the ministry on July 10, June saw a small increase of 349,681, bringing the number of xDSL subscribers to 8.2 miilion. June's growth decreased, compared with 450,000 recorded in April and 430,000 in May. Price declines, an increasing number of mobile users and increasing availability of broadband infrastructure will see the Asia-Pacific region outside of Japan lead in the most broadband subscribers globally this year. Asia-Pacific's 14 key countries will see a 31 percent jump from last year broadband subscribers, to 21.8 million this year. They will spend US$8.33 billion on broadband access in all, up 50 percent from 2002, according to market researcher International Data Corp (IDC). Growing at 24 per cent a year, there will be 48.6 million broadband subscribers by 2007, spending more than US$26.9 billion on broadband, growing 37 per cent a year during the period.

From http://asia.cnet.com/ 08/07/2003

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Japanese Birthrate Hits Record Low

TOKYO, Japan (Reuters) -- The number of babies born in Japan in the last fiscal year hit a record low while the percentage of elderly has hit a record high, clearly reflecting the nation's rapidly aging population. Figures released Wednesday by the Home Affairs Ministry showed the number of births in the year ending on March 31 stood at 1,151,507, the lowest since the country began keeping population records. The number of people aged 65 or older made up a record high 18.82 percent of the population, Kyodo news agency said. The total population rose by 209,692 to 126.7 million, the second smallest increase on record after the previous fiscal year, which showed an increase of 193,867, Kyodo said. The ministry said earlier this year that the total number of children under 15 in the nation had declined for the 22nd straight year, standing at 18.01 million as of April 1. In contrast, there were 23.62 million people over 65 as of September 2002.

From http://edition.cnn.com/ 08/20/2003

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SOUTH KOREA: Seoul Picks 10 High-Tech Areas as Growth Engines

The South Korean government has selected 10 high-technology industries as the engines that it expects will propel the country's economic growth in the future. The government held a meeting at the presidential office of Cheong Wa Dae yesterday to finalize the selection of the 10 new engines for Korea's economic growth. The 10 industries are intelligent robots, future automobiles, next-generation semiconductors, digital televisions and broadcasting, next-generation mobile communications, displays, intelligent home networks, digital content and software, next-generation batteries, and biomedical products, according to the presidential office. The Presidential Advisory Council on Science and Technology selected the 10 major industries from a larger list of the most promising businesses compiled by the concerned ministries earlier this year. "Korea should concentrate its resources on the 10 growth-engine industries as part of its strategy to achieve per-capital gross national income of $20,000, and should make them the springboard for leaping to an advanced economy," President Roh Moo-hyun said during the meeting, attended by senior administration officials, local business leaders and heads of private and state-run research institutions. Kim Tae-yoo, the president's aide for science and technology, explained that the 10 potential growth engines were expected to play a leading role in generating higher incomes and creating jobs through production and exports in the next five to 10 years. "The selection of them was based on each industry's market size, strategic importance, trend of change in the market and technology, competitive potential and economic impact," he added. The presidential aide also noted that the chosen industries would add 169 trillion won ($143.7 billion) in value, achieve $251.9 billion in exports, and create 2.4 million new jobs. He also said that each government ministry would make detailed plans to nurture the industries and draw up measures to support and cooperate with the private sector. (by Kim Hyun-chul)

From http://www.koreaherald.co.kr/ 08/23/2003

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INDONESIA: Government Releases Post-IMF Economic Reform Blueprint

The government pledges to continue selling its shares in a number of banks next year as part of a crucial bank restructuring program. This is contained in a document containing the country's post-IMF economic reform program, a copy of which was obtained by Dow Jones. President Megawati Soekarnoputri was supposed to release the blueprint on Friday when unveiling the 2004 state budget draft, but it was postponed as the government still need to finalize the programs, according to Coordinating Minister for the Economy Dorodjatun Kuntjoro-Jakti. "We'll publish it soon," he said. The blueprint is crucial as it would help maintain investors confidence in the economy when the current International Monetary Fund program end latter this year. Presidential elections in 2004 could lead the government to enact popular spending measures to create employment at the expense of the country's finances, some observers fear. Dow Jones said blueprint provided a timetable for the sale of banking sector assets. The government plans to sell majority stakes in Bank Lippo and Bank Internasional Indonesia by November this year, and Bank Permata by February 2004. It planned to sell around a 20 percent in unlisted state-owned Bank Rakyat Indonesia through an initial public offering in September this year. Also in September, the government hoped to pass a new money-laundering law through the House of Representatives, according to the blueprint. The blueprint also set macroeconomic targets through 2006. The country pledges to balance its budget by 2005 from a deficit of 1.8 percent of gross domestic product this year. Total debt will fall to 61.1 percent of GDP next year and 52.1 percent in 2005, from 67.2 percent this year. To help attract foreign investment, the government promised in 2004 to streamline taxation and investment regulations. Indonesia is coming under increasing pressure to create more jobs, especially ahead of elections. Boosting private investment is crucial at a time when the government's is under pressure to continue fiscal belt-tightening measures. Non-oil exports will grow 5 percent in 2004, and 6.5 percent in 2005, up from 4.0 percent this year, the blueprint said. The current account will shrink to US$4.3 billion next year, and $3.4 billion in 2005, from $5.1 billion this year, due to rising imports. Non-oil imports will rise 9 percent in 2004 and 10.0 percent in 2005, from 9.5 percent in 2003. Foreign reserves will fall to $33.7 billion in 2004 and $30.6 billion in 2005, versus $35.0 billion this year.

From http://www.thejakartapost.com/ 08/16/2003

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MALAYSIA: E-passport for Thais Planned

MULTIMEDIA Development Corp Sdn Bhd (MDC) will work with the National Electronic & Computer Technology Centre (Nectec) to develop e-passport which will facilitate Thailand and Malaysian immigration. "MDC will work with Nectec to transfer the e-passport platform used in Malaysia to Thailand," MDC senior vice-president Dr Muhammad Ghazie said. He added that there were five other areas of collaboration with Nectec. Ghazie was speaking to Starbiz at the sidelines of the Technology and Business Partnership Dialogue 2003 in Langkawi. He said MDC would also work with Nectec on the development and implementation of the general multi-purpose card in Thailand. "We will explore potential research and development cooperation on smart card integrated circuit chip and other related products," he added. Ghazie said MDC and Nectec would develop the next generation Internet, Internet protocol version 6, to connect Thailand and Malaysia. "We will explore developing a world class network matching the aggregated needs of Asia's Academic Network, advanced test-beds for integration and validation of next generation computers, networking, applications and services," he added. Ghazie said the collaboration with Nectec would focus on promoting electronic commerce for adoption in local enterprises in Malaysia and Thailand. "Besides local enterprises, we will promote the adoption of electronic commerce for government e-procurement and trade electronic data interchange," he said. According to Ghazie, MDC and Nectec will also work on exchanging information and experience on the development, implementation and harmonization of cyber-laws. "We will cooperate in software and content development for broadband and satellite applications. "We will also build up partnership in the software sector to explore third country market opportunities," he said.

From http://biz.thestar.com.my/ 08/01/2003

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Changes in Schools Likely

PETALING JAYA: The education system will undergo significant changes should the Government accept the recommendations of a special committee set up to review it earlier in the year. Former education director-general Tan Sri Murad Mohd Nor, who heads the committee, said the recommendations had been forwarded to the Prime Minister and would soon be presented to the Government. He said the findings and recommendations would be released in three stages - on religious schools (SARs), the national school curriculum and on enhancing the identity of national schools. "The committee has completed its work and the Prime Minister has been briefed on the findings and the recommendations. If accepted and implemented, I think the recommendations will have far-reaching effects on the education system. "Although I cannot divulge details, I am confident it will be well received and accepted by the Government although the implementation will depend on various factors like funding," Murad told The Star. The committee was set up following problems pertaining to SARs and that many national schools were turning into "semi-religious schools" causing non-Muslim parents to stop sending their children there. Murad said the review was meant to create a national system, in which students in religious, private or national schools learnt the same things and shared the same philosophy. He said the committee had considered the input from various groups, looked at problems faced by religious schools, the curriculum used, the facilities available as well as the qualification and calibre of teachers. "We have received many memorandums and suggestions and all these have been assessed and considered in the final recommendations."

From http://202.186.86.35/ 08/15/2003

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Silverlake Shares K-economy Vision

PETALING JAYA: Driven by the same vision as the Government, software developer Silverlake believes in creating a k-economy society through a solid education in information and communications technology. Its president for finance management and marketing support Andy Ng Kek Seng said the emergence of institutions of higher learning like Universiti Tunku Abdul Rahman (Utar) would pave the way in realising that vision. If we are going to be an advanced country, we need a lot more better educated people and expertise in ICT, said Ng after receiving a plaque comprising a miniature qi pao (cheongsam) from The Star InTech editor A. Asohan at Menara Star on Wednesday for purchasing the RM15,000 Shantung Silk table at the KL Fashion Week 2003 gala dinner on Aug 19. Silverlake is best known for its integrated banking system which is currently used by several anchor banks.

From http://202.186.86.35/ 08/15/2003

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PHILIPPINES: Nat'l Elearning Conference Opens at Manila Hotel

President Arroyo yesterday pushed for the government's distance-learning program to raise the literacy rate in some 400 remote and impoverished barangays in the country. In her keynote address at the opening of the 2nd National Conference on eLearning at the Manila Hotel, the President cited the importance of education through information and communications technology (ICT) in winning the war on poverty and terrorism. The President said the Strong Republic school program, through ICT, can now reach the isolated barangays in the country and prevent illiteracy among children living there. Bringing education to the depressed areas is a preemptive way to stop the recruitment of terrorists and the spread of insurgency in the countryside, Arroyo said. The government is expanding its distance-learning program, using mobile vans and television and Internet access, to provide basic education and special training courses to isolated areas in the country, she said. "This is a leap-frog solution to the lack of teachers in the remote areas," she said. Arroyo recently launched the SRS learning program to meet the shortage of teachers and classrooms, especially in conflict-ridden areas in Mindanao. She noted the root cause of insurgency and the breeding ground of terrorism can be traced to the gap between the rich and the poor. "This is where distance learning comes in," she said. According to the President, television would be the primary medium to deliver distance-learning programs to their intended audience in the rural areas. Arroyo said she has ordered the mainstreaming of Strong Republic Schools into the educational system in at least 400 barangays that lack teachers. "These barangays are also likely insurgency-critical," she said. The President, meantime, cited eLearning, or the delivery of education services by electronic means, to improve English proficiency as well as upgrade Math and Science aptitude of Filipino students to maintain their future competitiveness in the world labor market. "The ability to communicate in English has always been our strongest selling point and we don't want to take that for granted. Our literacy in English must not be allowed to deteriorate," she said. Also, the President also called for the reintroduction of moral values education in the current school curriculum. Arroyo agreed with the clamor of parents and teachers to restore good manners and right conduct in the school program. "We are not in the business in producing robots but enterprising human being. I therefore call for a deeper inculcation of moral, social and cultural values through basic education system," she said. "Knowledge without character is not acceptable. Critical thinkers are better citizen. We shall pursue this vision unswervingly. Because to do otherwise will only breed more poverty, more social injustice, more conflict," she said. Educators and other stakeholders convened for the two-day conference, organized by the Information Technology and E-Commerce Council, to explore the potentials of using new technologies in education and learning. This year's theme is "Integrating eLearning into Education and Industry." ELearning President Gloria Macapagal-Arroyo keynoted yesterday's opening of the two-day national conference on eLearning at the Manila Hotel Fiesta Pavilion. Theme of this year's conference is "Integrating eLearning into Education and Industry." Among those in attendance were Commission on Higher Education (CHED) chairman Bro. Rolando Dizon, CHED commissioner Dr. Cristina Padolina, CHED International Affairs director Dr. Ethel Valenzuela, Technical Education and Skills Development Authority (TESDA) director general Alcestis Guiang, and De La Salle University Graduate Schools (DLSUGS) Dean Dr. Benito Teehankee. Arroyo's address was an iteration of government's policy on mainstreaming distance learning into the educational system. The conference brings together educators, policy makers, school heads and administrators, and Information and Communication Technology (ICT) service providers interested in exploring the potentials of using new technologies in education and learning. A presentation on the transformation of the "Eskwela ng Bayan" to the Strong Republic School (SRS) is included in the first day conference program. Other topics discussed in the plenary sessions are effective learning organizations, choosing technology for eLearning, and knowledge management. Electronics learning of eLearning presents a lifelong learning opportunities to the Filipino workforce that must remain competitive in the world labor market. With eLearning, adult learners are able to pursue advanced training or even post graduate studies at their own pace without having to leave their work or their homes. Global developments in eLearning technologies have spurred local institutions to make use of the internet in the promotion and marketing of courses and delivery of courses in the context of programmatic web initiatives. (by Genalyn D. Kabiling)

From http://www.mb.com.ph/ 08/07/2003

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Economic, Population Growths Seen Pulling Up RP's Electricity Demand

The Department of Energy (DoE) has listed at least two major factors that would drive up the country's electricity demand - the increase in population which seen at 1.8 percent annually and economic growth at 5.6 percent. These factors have been factored in the revised Power Development Plan (PDP) that the energy department just submitted to the Joint Congressional Power Commission. Under said power development blueprint, it was shown that electricity demand in relation to the growth in the gross domestic product (GDP) would be highest in Visayas at elasticity ratio of 1.75 percent followed by Mindanao at 1.63-percent and 1.56 percent in Luzon. The other criteria factored in were provision of 13.2-percent reserve margin and one day loss of load probability per year. If based on 2003 power supply, the energy department placed dependable capacity at 13,262 megawatts against installed capacity of 15,132 MWs; and peak demand has been pegged at 7,970 MWs. By plant type, coal-fired facilities cornered the highest chunk at 26-percent share for 3,958-MWs followed by oil-based at 24 percent or 3,615 MW, though a number of these plants are currently on economic shutdown. Following next in the energy mix are hydro-powered plants with 19-percent share at 2,865 MW; natural gas plants with 18 percent share at 2,763MW and geothermal plants with 13percent or 1,932 MW. In Luzon, peak demand for year 2004 is projected to register an uptick to 6,967 MW, up by 513-MW from 6,454 MWs this year. Peak demand for Visayas, on the other hand, will be at 1,093-MW in 2004 from 1,006-MW this year; while Mindanao will have 1,117 MW next year from a peak demand of 1,049 MW in 2003. It was pointed out that a critical component of the Visayas power supply planning would be the electricity demand of the CebuNegros-Panay grid; which is expected to hit critical levels; if the transmission interconnection projects would not be completed on time. The energy department further disclosed that the committed capacities, at present, is just at 375MWs nationwide. In Luzon, the committed capacity is placed at measly 65MW comprising of the 25MW Northwind Power project and the 40-MW proposed wind facility of Philippine National Oil CompanyEnergy Development Corporation. Visayas, on the other hand, has 110MW of committed capacity; that includes the 40-MW Northern Negros and 20-MW Palinpinon project of PNOC: and the 50-MW project of Victorias Bioenergy; while Mindanao will have the 200MW facility of the State Power Development Corporation. Meanwhile, the indicative power projects, those which do not have firm financing yet or are still under feasibility study, are placed at 3,345 to 3,795.5 MWs. (by Myrna M. Velasco)

From http://www.mb.com.ph/ 08/08/2003

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7 Women Cited as East Asia Peace Awardees

Seven distinctive women led by the Philippines' own Corazon C. Aquino, were named and honored yesterday as East Asia Women Peace Awardees for their leadership in advocacy and life-long work in inter-cultural fellowship, for regional peace, and for international understanding at the opening of the East Asia Women's Convention for Global Peace going on at the Manila Hotel. The other recipients of the First East Asia Women Peace Award are Aung San Suu Kyi of Myanmar, a 1991 Nobel Peace Prize awardee, Dr. Jemilah Hadji Mahmood of Malaysia, Dr. Anamah Tan of Singapore, and Sr. Mary John Mananzan, OSB, Dr. Lucresia R. Kasilag, and Marietta P. Goco of the Philippines. The first East Asia Women Peace Award, being vetted as Asia's counterpart of the Nobel Peace Prize, has been made part of the convention "to give recognition and celebration to East Asia women for their work in advocating for peace and in cultivating peace initiatives in their country and for the world," said awards committee chairwoman Rosellyn E. Magsaysay, who is also the convention overall chairwoman, with Social Welfare Undersecretary Bai Omera H. Dianalan Lucman as co-chairwoman. The awards committee co-chairwoman is Dr. Zenaida Pangandaman-Gania.The East Asia Women's Convention for Global Peace is the brainchild of and a project sponsored by the Philippine non-government organization Millennium Women for Peace and Development Foundation (MWPDFI), whose chair and founding president is Lourdes "Bing" Pimentel, wife of the senator. Nominees to the first East Asia Women Peace Award, according to Pimentel, came from the 13 countries participating in the convention under five categories, namely: education, human rights, governance, science and technology, and arts and culture. "From the nominees," explained convention secretary general Minerva de Leon, "the awardees were selected by a board of judges composed of distinctive Filipino leading lights in various fields led Dr. Nona S. Ricafort as chair." The other judges are Joey Leviste, vice-chairman; Judge Aurora N. Reci?a, co-chairwoman on human rights'; NCRFW Commissioner Aurora Javate de Dios, co-chairwoman on education; Consul Fortune Aleta Ledesma, co-chairwoman on arts and culture; Dr. Zenaida Rotea, co-chairwoman on governance; and Justice Consuelo Ynarez Santiago, co-chairwoman on humanitarian service. Aside from Pimentel, the vice-chairwoman of the MWDPFI is Hadja Putri Zorayda Abbas Tamano. Other board trustees are: Magsaysay, De Leon, Bai Norhata Macatbar Alonto, Bai Omera Lucman, Gania, Esperanza F. Arkoncel, Norma Lozano, Bai Jamila Tamano Lucman, Barbara Teotico Anonas, Gloria Sevilla Cortez, Hadja Alnahar Pungutan Lazo, Dr. Norma Sharief, and Mercedes Cagas. The foundation's adviser is Rep. Faisah Dumarpa. The awardees were cited for the following: Madame Corazon C. Aquino - for having re-established democratic institutions and brought about substantive economic and social reforms during her term as President of the Republic of the Philippines, and her determined dedication to democracy and commitment to non-violence, enabling her to finish her term with the orderly transfer of power to Fidel V. Ramos following the first real presidential elections in the country in 23 years. It is also for her continuing mission of defending and strengthening Philippine democracy exemplified by her leading People Power twice in Manila with Jaime Cardinal Sin and standing firm in leading civil society and inspiring People Power for the third time recently towards a peaceful and democratic political leadership change. Madame Aung San Suu Kyi - for her passionate advocacy of freedom and democracy in her country now called Mynamar, which won for her the Nobel Peace Prize in 1991, for expressing her belief in calm passion reflecting her idealism, love for freedom and democracy and advocacy of women empowerment, and her continuing efforts in the pro-democracy movement and firm conviction to fight repression in her country sacrificing home and family. Datuk Dr. Jemilah Mahmood - for bringing into fruition her altruistic dream to serve the under-privileged by forming the Malaysian Medical Relief Society, popularly known as MERCY Malaysian, for uniting and bringing together through MERCY Malaysian Malaysians from all walks of life with the common goal to serve those in need-irrespective of race, religion, culture or boundary-and for leading her over 2,000 volunteers in serving countless victims of natural and complex humanitarian disasters at war-torn countries-from Kosovo and Afghanistan to Turkey and Iraq. Dr. Anamah Tan - for having advanced the rights and status of women in Singapore, in Asia and elsewhere, and for being a pioneer in Asia's Women's movement and a tireless advocate on gender issues, notably on domestic violence and poverty eradication. It is also for her having served in various leading capacities in major women's councils and organizations and in ministerial committees on community and family projects, and for having played an influential role in galvanizing the leading women's associations in Singapore into a unified body under the umbrella of the SCWO. Sis. Mary John Mananzan, OSB - for involving herself in charting new paths in the academe and in feminist activism, giving birth to women-centered programs, among them the Institute of Women's Studies and Women Crisis Center, as well as for having served as national chair of GABRIELA, a broad alliance of women's organizations, for 15 years, and as president of St. Scholastica's College. It is also for being actively involved in developing a distinct Third World Theology and having organized the Dialogue of First and Third World Theologians in 1994, and for having authored and served as editor of books, namely: Women Resisting Violence and Women and Spirituality. Dr. Lucrecia R. Kasilag - for doing her country proud in its music in a career spanning six decades and 350 musical compositions, especially her pioneering work in discovering the roots of Filipino identity through ethnic music, fusing it with western influences and thereby leading other Filipino composers to experiment in the same approach. Also for being a dedicated educator, composer, performing artist, administrator and cultural doyen of national and international caliber. Marietta Primicias Goco - for being the conceptualizer and prime mover of the Philippine poverty legislation program, in the process putting marginalized rural women in the mainstream of the financial structure of the country. Also for making micro finance become a government policy through the creation of the People's Credit and Finance Corporation with the People's Development Trust Fund for Capability Building. She is also recognized for giving poverty a name and face, for which earlier President Fidel V. Ramos invested her the Presidential Order of the Golden Heart. She is likewise a recipient of the 1st Eleanor Roosevelt Award in New York, U.S.A., in 2002.

From http://www.mb.com.ph 08/12/2003

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SINGAPORE: Online University Group Spends S$50m to Set Up Asian HQ in Singapore

A group of 16 universities offering postgraduate online courses has pumped in S$50 million to set up its Asian headquarters in Singapore. And although the take-up rate for its MBA has been slow, Universities 21 Global is stepping up marketing in the region. The newly-launched MBA programme started last Friday with 27 students, including 11 Singaporeans. They expect to see 500 students sign up in the first year, with the flexibility of letting new students come onboard every week. But it hopes things will take off when its marketing reaches Hong Kong, China and Korea later this year. One reason for choosing Singapore as regional HQ is because it is close to its two biggest markets - India and China. Tharman Shanmugaratnam, Acting Education Minister, said: "It is estimated that the e-learning market in the Asia Pacific will reach US$400 million by 2005. That's two years from now." Depending on living standards, fees varies across countries so an Indian pays US$11,000, while a Singaporean US$13,000.A check with NUS, one of the partner universities, shows its own full-time MBA costs around $20,000, while a part-time one costs $25,000.The institution says being online, it is not limited by size like traditional universities. Dr Mukesh Aghi, CEO, Universities 21 Global, said: "There are roughly 35 million students who are unable to get that education and that number will grow to 100 million in 10 to 15 years." The institution says it will not mimic a traditional brick and mortar university and so there would not be any video-conferencing. But it says students can still communicate with each other and with their lecturers through chat rooms as well as discussion boards or email. While doing assignments, students can access articles, journals and periodicals in the online library. But they will not be able to gain access to the libraries of participating universities. However that will be possible for students taking courses under another group of online universities, the UKeU. Under a tie-up with Singapore's MDIS, students taking courses under UKeU also get a direct degree from the university they took the course from. (by Ca-Mie De Souza)

From http://www.channelnewsasia.com/ 08/05/2003

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Singapore Car Owners Can Now Renew Road Tax Online

Car owners can now renew their road tax from the comfort of their homes or offices via Road Tax Online (ROTAX). However, this does not remove the need to first obtain a valid motor insurance coverage and vehicle inspection certificate. Owners must also have a valid Internet banking account with DBS, UOB or Citibank to make payment. Besides the convenience, 10 lucky motorists who use the LTA's eNETs services at www.onemotoring.com.sg from now to January 2004, also stand to win attractive prizes. A grand draw will be held in February next year, and the winner will walk home with a plasma television. Motor traders and individuals can also benefit from LTA's new e-service. Those requesting for vehicle type approval and modifications can now also submit their applications online through the Vehicle Inspection & Type Approval System (VITAS). They will then only need to make a trip to the vehicle inspection centres. The status of their applications can also be tracked online. With ROTAX and VITAS, LTA now offers a total of 11 e-services on their portal. (by Johnson Choo)

From http://www.channelnewsasia.com/ 08/06/2003

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Singaporeans Can Remain Upbeat About The Economy as It Globalizes

Singapore has reasons to be upbeat as the Republic celebrates its 38th birthday on Saturday, says Raymond Lim, Minister of State (Trade and Industry). He says he is optimistic that in 10 to 15 years, the Singapore economy will become a globalised, entrepreneurial and diversified economy. Mr Lim said: "Globalise - I mean an economy that is intimately linked with the rest of the world. An important global node. And we're taking steps to expand our market space for the free trade agreements that we have." Singapore has concluded five FTAs and another five are being negotiated with one of them being the biggest in the world: the ASEAN-China FTA. He also disagrees with the view that the Singapore economy is in structural decline and is unable with compete with the Chinese economy. He said: "If that's the case, we fold up and give up. But I think that's absolutely not true. That even though if China is on absolutely basis cheaper than a lot of players, a fact that any first year economic student will tell you is that it is competitive advantage that's important." On a more personal note, he told our reporter: "To be in a position, to try to make a difference is important. I think everyone should try to do that. It's one of the key reasons why I enter into politics. And I hope in some way or another, I'll make a contribution, and make things better for Singaporeans as well." Mr Lim was the founding president of the Roundtable, a civic society discussion group back in 1994. (by Joanne Lee)

From http://www.channelnewsasia.com/ 08/08/2003

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IE Singapore's Hub Development Schemes Draw 18 More Global Firms

Another 18 international trading and shipping firms have joined the ranks of more than 150 other such companies making Singapore their business hub. The 18 were given awards under International Enterprise Singapore's Global Trader Programme and Approved International Shipping Enterprise schemes. The awards confer tax concessions to the international traders and shippers who set up their regional or global operations here. The new recipients include international rubber traders like Bridgestone, equipment suppliers like Caterpillar, and top shipping companies from countries like Australia and Japan. Last year, companies under IE Singapore hub development programmes contributed more than S$4 billion in local spending and employed over 6,000 staff. Some of the companies ChannelNewsAsia spoke to say Singapore's strong infrastructure makes it an attractive choice for a business hub. But they add that the high cost structure here is a cause for concern. "Shipping is a low margin business and we're always concerned about cost," said John Lines, managing director of ANL Container Line. "We are aware that the government is focusing on this area. I think we have the confidence they'll find ways around minimizing any cost blow-out. At the moment, it is at an acceptable level, but we have to keep an eye on it." (by Frederick Lim)

From http://www.channelnewsasia.com/ 08/15/2003

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IDA Sets Up E-Supply Chain System to Cut Business Costs

Singapore's Infocomm Development Authority is setting up an e-supply chain management system to help cut business costs. For a start, it will test the S$20 million, two-year project on supermarkets and their suppliers. Currently, suppliers taking orders from the various supermarkets in Singapore have one big headache. They have to plough through many different forms and codes to process these orders. But under IDA's new supply chain system, these will now be standardised. The three major supermarket chains here - NTUC FairPrice, Cold Storage and Shop & Save - are developing their own software to tap into IDA's infrastructure. Why pick supermarkets to test out the system? Dr Lee Boon Yang, Minister for Information, Communications and The Arts, said: "One of the important loss areas for supermarkets, especially if they were to carry perishable goods, is the spoilage factor. With a good e-supply management chain ecosystem, they're closely integrated with suppliers supermarkets save on losses, benefit in pricing to consumers. "The project is expected to generate savings equal to about 2 percent of revenue for the supermarkets. Some 100 suppliers will take part in the project. IDA will subsidise up to 50 percent of the training cost. Besides the e-supply system, the IDA also plans to set up more projects to enhance online business information exchange between suppliers and the SMEs, many of which are still not sure if it's safe to do business online or how to communicate with suppliers online. But some firms like Stamfles Food Management have taken their own initiative to put their business online. Alson Teo, CEO of Stamfles Food Management, said: "We're going to launch in perhaps 2 weeks' time our outdoor catering division. We're going to have an extensive Web-based interactive online ordering catering. Customers can reach us seven days, 24 hours, go to the Web and change the menu if they want." According to the latest IDA survey, 83 percent of Singapore businesses already use infocomm technology, and the e-supply project should boost the percentage even higher. (by Katherine Tay)

From http://www.channelnewsasia.com/ 08/21/2003

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Starhub to Charge "Surf for Free" Internet Service

From September 1, StarHub will start charging customers using its Surf-for-free Internet service. A two-cent per minute access charge will be levied on its subscription-free customers. The new charges will be reflected in the subscribers' fixed-line operator bill. StarHub says a big portion of its 300,000 free-Internet customers have become more Internet-savvy, and have migrated to either paid dial-up or broadband service. As a result, free-service customers have shrunk significantly, and the company needs to impose a minimum charge, to keep the service economically viable. Rival SingNet made a similar move in February. So now, both are on par, offering Internet browsing for $1.20 per hour. (by Stephanie Sim)

From http://www.channelnewsasia.com/ 08/21/2003

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THAILAND: Bangkok, Seoul Team Up on ICT

Thailand will sign a memorandum of understanding with South Korea next week to promote collaboration in the field of information and communications technology (ICT). Under the government's plan approved by the Cabinet yesterday, ICT Minister Surapong Suebwonglee will ink the accord during the visit of Prime Minister Thaksin Shinawatra and his delegation to South Korea from August 24-26. The initiative to work together in the ICT arena on e-government projects, e-education, e-procurement and software development is in line with the Thaksin government's policy to enhance the country's global competitive edge through ICT capacity-building. The parties will help develop ICT human resources and telecom standards as well as set up a joint committee to implement the agreement and review its progress. The pact will last for five years and be automatically extended every five years. Earlier Surapong said Thailand wanted to learn much more from South Korea, especially about the broadband Internet industry. South Korea has the largest broadband Internet market in the world. Broadband Net service in the Kingdom is still in the nascent stage due to high service charges, with only around 8,000 users. But rapid adoption is expected to bring the figure up to 20,000 next year. Surapong has already visited Ireland and Finland to seek closer ICT ties. A plan emerged from the discussion with Finland to establish a joint IT fund to invest in budding projects here and abroad. The premier visited Malaysia last month to improve trade and ICT coordination.

From http:///ww.nationmultimedia.com/ 08/20/2003

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VIET NAM: All Communes to Have Power by 2010

A rural electrification scheme being drafted by the country's power utility is set to connect to the national grid the last of Viet Nam's communes that have remained unconnected. Deputy head of Electricity of Viet Nam (EVN)'s Committee for Business and Rural Power, Trinh Ngoc Khanh, said the Rural Energy 2 scheme would connect 400 of the total 848 communes still outside the pale by the end of next year. When complete in 2010, the project would have cost US$300 million, including $220 million to be borrowed from the World Bank. Besides providing electricity to many communes through linking with the national grid, where topography does not permit the linking, the project would develop local power sources by building small plants and solar energy units. EVN also hopes to restore and upgrade the power transmission network in about 1,200 villages. Currently only 42 per cent of the mountainous Son La Province's communes have access to electricity. Hoang Trong Nam, director of the Son La Electricity Co, said apart from World Bank loans, the province will tap local investment to develop power projects like Nghia Hung in Moc Chau District, Chieng Ban 2 and Chieng San in Mai Son District, Cheng Buom in Thuan Chau District and Sop Cop in Song Ma District. Each project would cost between VND1.3 and VND1.7 billion. "It is expected that by the year-end, about 63,000 households here will be linked to the national grid including 23,000 through Rural Energy 1 project," says Nam. Son La authorities hope to provide electricity to all the province's communes either from the national grid or other sources, including in remote and inaccessible areas. According to EVN, besides Son La, 50 per cent of all households in other mountainous areas like Bac Can, Lao Cai, Lai Chau, Ha Giang and in the southwestern region - Kien Giang, Bac Lieu and Ca Mau - do not have electricity. Industry Minister Hoang Trung Hai said at a recent conference on electricity management and development in the Cuu Long (Mekong) Delta's rural areas, the Government will make rural access to electricity a high priority under efforts to fully tap the region's economic potential. Since 1996, EVN has been striving to provide stable electricity supply to the delta's rural areas. All the region's communes had access to the medium-voltage power network by June 2002. The number of rural households with access to the national power grid increased from about 2.2 million (70 per cent) in 2001 to nearly 2.3 million (73 per cent) in mid-2002; the rate is expected to rise to 76 per cent by the end of this year. EVN has devised long-term strategies to ensure transmission safety, reduce electricity losses and lower power prices for domestic use. The Energy Institute forecasts that the region's demand for electricity will rise 12.7 per cent a year for the next 10 years, from 3 billion kWh in 2000 to nearly 6 billion kWh in 2005 and about 10 billion kWh by 2010, accounting for more than 10 per cent of national demand. To supply electricity to all communes and 95 per cent of households in the region, by 2005 the power sector plans to build a 600MW gas-powered plant in O Mon, Can Tho Province, and a 720MW plant in the Ca Mau gas-electricity fertiliser zone. Between 2006 and 2010, the O Mon power plant will be expanded to 1,200MW, and a 720MW gas-powered plant will be built in Hon Dat District, Kien Giang Province. The sector also plans to invest more than VND509 billion (US$34 million) in low-voltage electricity grids in 78 communes in Bac Lieu, Kien Giang, Ca Mau, Soc Trang, Tra Vinh and Vinh Long provinces. The Cuu Long (Mekong) Delta encompasses 12 southern provinces and is the country's biggest rice producer, with an annual output of 16 million tonnes. Besides, large areas of the region are under orchard cultivation. The region plays an important role in the country's socio-economic development, and is pivotal to Viet Nam's security and defence.

From http://vietnamnews.vnagency.com.vn/ 08/08/2003

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VN Urged to Hasten Reforms to Join WTO

Viet Nam must act promptly to speed up its market reforms if it is to gain full membership of the World Trade Organisation (WTO) in 2005, a senior World Bank official said. "The World Bank fully supports Viet Nam's ambitious goal of becoming a WTO member by the end of 2005 and stands ready to assist in whatever way we can with customs modernisation and the design of a 'road map' for WTO accession," the bank's managing director, Shengman Zhang, said on Wednesday. Zhang said structural reforms in the enterprise and financial sectors, which were already a domestic priority, would help Viet Nam along the path towards WTO membership. "Viet Nam has made remarkable progress in reducing domestic protection, but strong political support is needed, as are a reform acceleration plan and an effective and efficient co-ordination mechanism led directly by the country's leaders," Zhang said at the end of a four-day official visit to Viet Nam. "We stand ready to assist Government with technical assistance on the policy and institutional changes required, and to enhance the capacity of policy makers at the central and local levels for cross-sector co-ordination," he said. He lauded Viet Nam's achievements in economic growth and poverty reduction during the past decade, and the country's recent achievements in being the first to control the SARS epidemic. "The World Bank is pleased to be a partner to the Government and is committed to working closely with Government in support of its development objectives," Zhang said. During his visit, Zhang met the Vietnamese Party leader Nong Duc Manh and senior Government officials to discuss Viet Nam's development and poverty reduction efforts, including the country's planned accession to the WTO. He also met foreign ambassadors, development partners and NGOs in Ha Noi, and visited a commune in Quang Ninh Province that had been connected recently to the electricity grid in a World Bank-funded rural energy project. In HCM City, Zhang met private sector representatives and inspected a World Bank-funded urban project which sought to improve the living conditions of the urban poor, using participatory planning methods and redesigning the planning processes to become more inclusive and pro-poor. He also travelled to Ba Ria-Vung Tau province where he visited the Phu My 2.2 power station, currently under construction by a private sector consortium with a World Bank-supported partial risk guarantee. The World Bank said the power plant would help Viet Nam meet its growing power demands in a cost-effective and reliable manner, while also promoting the Government's reform efforts by demonstrating a competitive and transparent framework for private sector participation. Zhang said the power project was a good example of how innovative financing solutions could attract private sector investment for Vietnam's growing infrastructure needs which could not be met purely from public resources. "Progress since the groundbreaking in January 2003 has been remarkable, and we hope to build on this momentum by working with Government on a major energy financing conference in September that will showcase specific investment proposals for public-private partnerships," Zhang said. The World Bank currently has 26 active projects in Vietnam with commitments of US$2.8 billion.

From http://vietnamnews.vnagency.com.vn/ 08/08/2003

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Strategy Ushers in IT Competition in VN

Viet Nam will open up its market to encourage all economic sectors to take part in the Information and Communication Technology (ICT) industry to raise the efficiency and competitiveness of the computing sector, participants in a seminar on national ICT policy said on Tuesday. The draft was made known at the two-day seminar Paving the Road towards Viet Nam's ICT Strategy, which focuses on infrastructure and industry development. It is the second of a series organised by the Ministry of Posts and Telecommications with UNDP assistance. The seminar brings policy makers, donors and the private sector together to work out Viet Nam's first comprehensive plan for developing its ICT industry. The seminars are part of the National Consultations on Information and Communication Technology for Development project, conducted with UNDP assistance. Participants said that Viet Nam will become a promising market for information technology, possibly one of the top three countries among ASEAN in terms of IT and telecommunications infrastructure. The domestic ICT industry will reach US$5.5 billion by 2010, accounting for 9 per cent of gross domestic product up from the current 1.5 per cent, participants said. The project is in line with the International Telecommunications Union's 2002 country study, which reported that Viet Nam has one of the fastest growing telecommunications infrastructures in the developing world and the fastest growing telecommunications market in Southeast Asia. The annual growth rate in telecommunications and internet use in Viet Nam between 1995 and 2002 is 32.5 per cent, according to the union. The study reported that the total number of desk telephone subscribers as of August 2003 reached 6.4 million, increasing annually by around 30 per cent. The telephone density is now 8 per 100 people. Also, mobile phone networks reached all 61 cities and provinces in 2002. The total number of mobile phone subscribers is about 1.9 million with the rate of 2.5 phones per 100 people. New services and value added services in both desk telephone and mobile phone are also increasing, the study found. The strategy's four focus areas will be upgrading Viet Nam's IT infrastructure, developing human resources, improving IT applications and strengthening the domestic IT industry. Deputy Minister of Posts and Telematics Mai Liem Truc said that ICT was one of the centrepieces in the implementation of the Government's decade-long development strategy. He continued, saying that directive 58 of the Party Politburo recognises ICT as a pillar in the country's infrastructure and one of the driving forces of economic growth. UNDP Resident Representative Jordan Ryan welcomed this move to open up the IT market, saying, "Viet Nam has several distinct advantages in developing its ICT industry. These include a young and skilled, hard working labour force and a leadership determined to develop its industry."

From http://vietnamnews.vnagency.com.vn/ 08/20/2003

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INDIA: Infrastructure Critical for Poverty Reduction

NEW DELHI, INDIA - There is a strong linkage between infrastructure investments and poverty reduction, members of a high-level ADB team told the Ministry of Finance and Planning Commission in India. The ADB team, led by Special Advisor to the President, Greet van der Linden, has just completed discussions with the Ministry as part of an overall review of ADB's Poverty Reduction Strategy, which was adopted in 1999. van der Linden stressed the need to obtain the views of developing countries in the course of the overall review and noted that consultations are being held in six ADB developing member countries: the People's Republic of China, India, Kyrgyz Republic, Papua New Guinea, Sri Lanka and Vietnam. Indu Bhushan, Principal Economist, Social Sectors Division, Mekong Department, ADB said that studies by ADB and others have established a strong linkage between infrastructure investments, economic growth and poverty reduction. Hence, the mission's consultations focused on the critical importance of infrastructure development to the success of the strategy in India - particularly in transport, energy and the urban sector. Such development includes rural roads, rural electrification and assured irrigation as well as systems of power grids and national highways, which link poor rural producers to their power sources and to their markets in towns, cities and ports. The team also met representatives of voluntary agencies, government agencies implementing ADB projects, academia and international agencies. Sudipto Mundle, India Chief Economist for ADB, said that the Government and other partners supported ADB's poverty reduction strategy, which is based on the three pillars of pro-poor sustainable economic growth, inclusive of social development, and good governance. The review team also discussed the importance of the rural economy, which continues to sustain 74% of the poor in India, and the central role of improving governance in addressing the needs of the poor. The actual operational strategy for each country is prepared after consultation with the Government and other stakeholders. A country strategy and program was prepared for India earlier this year, which mainstreams poverty reduction through growth as the central goal of ADB operations in India. The overall review of ADB's poverty reduction strategy is expected to be completed before the end of the year.

From http://www.dailynews.lk/ 07/31/2003

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Net Policing Comes to India

MUMBAI: The thought police is gearing up to storm the virtual world. In what appears to be its first serious attempt to monitor the Internet, the Government of India has outlined an official procedure for blocking websites. An order issued by the department of information technology on July 7 enables a bunch of bureaucrats to decide the websites Indian surfers are allowed to access. ''This is the first formal step towards Internet censorship in Indian law,'' warns Somasekhar Sundaresan, a lawyer who specialises in technology issues. ''The order provides the State with sweeping powers to police Internet content. For example, news breaks such as those in Tehelka.com can simply be blocked by the government using these powers.'' Interestingly, the Information Technology Act, 2000, only provides for the blocking of pornographic websites and the monitoring of websites which endanger public order, the integrity and security of the nation and relations with other countries. But the new diktat goes a few steps further - permitting the blacking out of ''websites promoting hate content, slander or defamation of others, promoting gambling, promoting racism, violence and terrorism and other such material, in addition to promoting pornography, including child pornography and violent sex''. The order - No. GSR529(E) - goes on to add: ''Blocking of such websites may be equated to balanced flow of information and not censorship.'' Critics, however, point out that much can be accommodated under this umbrella clause. According to the order, various agencies - including central and state home departments, the courts, CBI, IB, police and the chairman of the National Human Rights Commission - can submit a complaint to the director of Cert-In, a new organisation which has been set up by the government to address IT security issues. This will then be examined by a committee comprising bureaucrats from Cert-In, the department of information technology and the law or home ministry. The committee will ''meet and take on the spot decision on whether the website is to be blocked or not''. Neither the producers of the website nor those with a contrary point of view are to be given a hearing.

From http://timesofindia.indiatimes.com/ 08/01/2003

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Mumbai Is India's Most Expensive City: Survey

India's financial capital Mumbai is the country's most expensive city while it will cost 40 per cent less to live in Delhi, the national capital, a recent survey pointed out. The survey, conducted by ETIG and market consultants AC Nielsen ORG-MARG, also revealed that Hyderabad is the cheapest metro, while Pune and Bangalore rank number 4 and 6 respectively. If a family were to shift from Delhi to Mumbai, its monthly expenditure would soar by 44 per cent. The survey on cost of living index of eight major Indian cities with Delhi as the base revealed that the high rents in Mumbai was the main reason for the bigger dent on family budgets. Rents account for 20 to 40 per cent (depending on the city) of a family's monthly expenditure. "For a median locality, the rent doubles as we move from Delhi to Mumbai. Even if rent is removed from the basket, the jump is 11 per cent. On an average, fruits, vegetables, daily provisions, and even basic utilities such as telephone and electricity, cost more in Mumbai," the survey said. This year, Chennai moved up two places to the third slot, and is now the most expensive city in south India, primarily on account of higher expenditure on fruits, vegetables and provisions. A wave of branded products flooding the Tamil Nadu capital is making life more expensive in Chennai, the survey revealed. Next in line is Pune, followed by Kolkata, Bangalore and Ahmedabad, which is five percentage points ahead of Hyderabad. The cost of living in the hi-tech city of Hyderabad is about 57 per cent cheaper than in Mumbai. The survey results also take into account various other factors such as cost of provisions and schooling. The survey reveals that while movie tickets in Delhi are among the most expensive, it scores well on basic utilities such as petrol/diesel and cooking gas as well as on electricity and telephone bills. The national capital has one of the lowest telephone tariffs, while Kolkata and Chennai have some of the highest. Days of frequent power cuts are now a bad dream of the past for Kolkata dwellers who now enjoy the cheapest electricity tariffs across metros. Hyderabad seems to be the costliest in terms of electricity. This is notable, given the state's recent thrust and competition from its southern counterparts, Bangalore and Chennai. Ahmedabad is a close second to Hyderabad in terms of electricity tariffs. Looking at the country geographically, the survey reveals that south India is least expensive being 20 per cent cheaper than living in the west, the most expensive region. North India is relatively more expensive than the south and east. "The gap between the costliest and the most inexpensive city in India does not appear to be narrowing. In fact, it has marginally increased this year. Hyderabad was 46 per cent cheaper than Mumbai last year, and according to this year's survey, it is now 43 per cent cheaper. Among the cheaper cities in the country are Hyderabad, Ahmedabad and Kolkata primarily in terms of healthcare costs, travel bills and rents. However, in a predominantly vegetarian Ahmedabad, non-vegetarians have to shell out 10 per cent more on an average. "Pune and Bangalore are two seemingly deceptive cities in the list. Coming up in the corporate ladder, these two are getting more sophisticated and expensive," the survey said. Minus the rental expense, Mumbai is still the most expensive city while Pune's rank falls from third slot to the seventh, and Bangalore rises from the seventh to fifth place. Interestingly, Pune, Kolkata, Bangalore, Chennai and Ahmedabad are now on the same rung of monthly expenditure.

From http://www.hindustantimes.com/ 08/08/2003

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India 5th Emerging Retail Economy: Knight Frank

The global real-estate consulting group Knight Frank has ranked India fifth in the list of 30 emerging retail markets and predicted an impressive 20 per cent growth rate for the organised retail segment by 2010. "The Indian retail industry has undergone a significant change and now ranks 5th amongst 30 emerging retail markets in developing countries," Knight Frank said in its latest report. The organised segment is expected to grow from a mere two per cent to 20 per cent by the end of the decade, it said, adding "this is not surprising, considering that the organised retail sector is growing at 8.5 per cent per annum". The size of the organised retail industry has been put at Rs 19,500 crore ($ 4.24 billion) in the last fiscal. Investment in retail real estate segment yields 13-16 per cent return which is quite high when compared with the returns from residential and office segment. HDFC, the investor in Shoppers' Stop in Pune, recorded a 15.43 per cent net return per annum on its initial investment. The space leased by Addidas in Ansal Plaza, Delhi, yielded a net return of 15.84 per cent to the investor. The future retail growth would also be substantiated by a high level consumer spending which rose at an average 11.5 per cent annual rate during the last decade. The study predicted that about 25 million square feet of organised retail space will come up in India by 2005. Initially, the retail sector growth took place in Tier I cities while now the retailers are focusing on Tier II cities like Nagpur, Indore, Jaipur, Chandigarh, Lucknow and Cochin.

From http://www.hindustantimes.com/ 08/10/2003

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Kolkata Ready to Take on London, Munich

KOLKATA: It's hardsell time for this former British capital of the East. Come January and Kolkata can lay claim to competing with global cities like London and Munich in trying to attract entrepreneurs and tourists from all around the world. Taking a cue from the world-renowned Oktoberfest in Munich and the Thames Festival in London, the city is set to host its first international festival that aims at promoting Kolkata as a world-class destination at both the national and international levels. Although the event was earlier scheduled to be held in December this year, the festival has been pushed back by a month to be in synch with the calendar for such global events. The big idea is to seamlessly merge business opportunities with sightseeing activities during the week-long jamboree. The festival, work-named 'Kolkata Festival', pending a final decision on its title, is being developed and promoted by the Indian Chamber of Commerce, one of the leading industry associations in India, and will entail a multi-crore budget during its inaugural run. The magnitude of the event can be gauged from the fact that the promotional budget has been earmarked at a whopping Rs 2 crore. Says Kanchan Datta, the head of the advertising agency that has bagged the prestigious project, "It is an elaborate blitzkrieg that has been planned to change the perception of the city in the eyes of outsiders. Our mandate is to promote the mega-project at three levels locally, nationally and internationally. Accordingly, we are working on the final media plans." Datta reveals that the theme for the event would be 'Expressions of Life' and would encompass several sub-events. "Business seminars at five star hotels, corporate competitions, race course events, film and theatre festivals, musical concerts, food festivals, an art festival that is likely to be clubbed with singer Usha Uthup's proposed Park Street Carnival, float parades, river cruises and a gala closing ceremony at the Millennium Park complete with a spectacular fireworks display would make the city come alive for seven days and nights," says Datta, with unabashed enthusiasm. The state government, backed by chief minister Buddhadeb Bhattacharjee, has reportedly shown keen enthusiasm in the entire project. Moreover, talks with several multi-national firms and large Indian corporates are at an advanced stage. Nazeeb Arif from the Indian Chamber of Commerce, the person spearheading the entire project, adds, "We are close to signing several deals with sponsors. We are also fine-tuning the components of the entire project." In London, the Thames Festival engages hundreds of different organisations, boroughs, authorities, schools, interest groups and other institutions, and attracts hundreds of thousands of viewers, both directly and through massive television coverage in September every year. Last year, the festival had funding support from over 40 public and private sources that included the Mayor's office. Similarly, for over several hundred years, a large number of visitors 'express life' every year during the Oktoberfest in Munich. As the name suggests, the annual festival is held in October. For the 300-year-old city of Kolkata however, such 'expressions of life' will only be seen for the first time early next year. (by Sujoy Bosu)

From http://timesofindia.indiatimes.com/ 08/17/2003

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SRI LANKA: Commercial Bank's 24-Hour 'E-Seva' Facility for E-Banking and Info

Commercial Bank of Ceylon has installed personal computer terminals for the exclusive use of the public at selected branches. "The new facility, branded "e-Seva" provides customers who visit these branches 24-hour access to an extensive range of e-banking transactions and information, enhancing convenience to them," Commercial Bank's Deputy General Manager - Information Technology Angelo Peiris said. The "e-Seva" facility allows customers to make utility bill payments, settle Colombo Municipal Council rates, carry out wire transfers, obtain statements of their accounts, make standing orders, transfer funds and settle credit card outstandings. The terminals also provide access to information such as interest and exchange rates, ATM and branch networks and holiday banking facilities of the bank even to non-customers. The "e-Seva" facility will initially be available at the Colombo 7 and Bambalapitiya branches with Kandy, Matara, Galle, Kurunegala and Negombo branches to follow very soon. This facility will subsequently be extended to the bank's other branches as well. "The 24-hour 365 day availability of e-Seva will definitely be a boon for all those who do not have access to Internet facilities at office or home and to all those busy people who do not have the time to visit the bank during normal banking hours," said Peiris. "Commercial Bank is committed to keeping pace with the latest trends in information technology and ensuring the delivery of best solutions to customers," he said.

From http://www.dailynews.lk/ 07/31/2003

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Maldives' Population to Exceed 293,000 by 2005

MALE (HNS) -- The population of Maldives would exceed 293,000 by the year 2005, according to The Ministry of Planning and National development. The population will comprise mostly of people who are between15 and19 years, second highest will be people who are in the age group 10-14years, and third highest will be people who are in the 20-24 years age group. The population information are available in the latest Statistical Year Book, published by the Planning Ministry. The Planning Ministry predicts that Maldives population after two years will comprise 41,400 people who are between 15 and 19 years. And the population of people who are aged 10-14 years will exceed 38,000. The population of people who are aged between 20 and 24 years will exceed 33,000. The statistical records of the Ministry show that the least number of people in Maldives population in the year 2005 will be of people who are above 70 years. By then, the population of that age will reach 3,679.

From http://www.haveeru.com.mv/ 08/06/2003

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NEPAL: Govt. Website on Peace Talks

The government has formed a website, www.peacetalks.gov.np to disseminate information on government-Maoist peace talks, an announcement said Friday. Secretariat of the Peace Talks Coordination, which is under the Prime Minister's office, launched the website. The third round of peace talks is beginning on August 17, 2003 in the western city of Nepalgunj.

From http://www.nepalnews.com/ 08/16/2003

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Nepal Nears WTO Membership

Nepal is receiving full membership of World Trade Organization (WTO) from the fifth minister-level meeting of WTO to be held in Cancun, Mexico from 10-14 September, agencies reported from Geneva Sunday. Nepal' entry into the global trade body was decided in the final meeting of the working committee of the WTO that concluded in Geneva Friday. The meeting was held in connection with Nepal's accession to WTO. Nepal has to fulfill some procedures in the Cancun meeting to achieve membership, reports said. The working committee meeting studied all the documents presented by Nepal and gave final shape for the membership, said the Ministry of Industry, Commerce and Supplies. On the occasion, representatives of the developed countries also expressed their desire to provide technical cooperation to Nepal in certain areas after acquiring the membership, The Himalayan Times reported. Nepal and Cambodia are now on course to become the first least developed countries to complete the full negotiating process to join the WTO since it succeeded GATT in 1995. Nepal will be the 148th WTO member, after receiving membership.

From http://www.nepalnews.com/ 08/16/2003

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PAKISTAN: IT Sector Has Great Potential for Investment

KARACHI, Pakistan: (PNS) - Sindh Governor, Dr Ishrat-ul-Ebad has said that financial and IT sector is most dynamic sector and has great potential for investment and higher rate of return. "Pakistan is one of the few countries in the region which has made substantial investment in IT sector over the past few years", the Governor said while speaking as chief guest at the closing ceremony of International Seminar/Exhibition on Technological Innovation in Finance Sector Industry, here on Saturday. The event was organised by the Sindh Department of Information Technology in coordination with Computer Society of Pakistan. The Governor pointed out that necessary infrastructure like internet connectivity, availability of bandwidth, mobile cellular telecommunication including phone, data transmittal, video conferencing and long distance learning has shown great promise. He welcomed the participants in the province of Sindh and city of Karachi, particularly the speakers from many countries of the world to deliver speeches and give presentations on tecyhnological innovations in the most dynamic and vibrant. The Governor said it is a truth that Sindh in general and Karachi in particular is the business hub of Pakistan and a gateway to the East and West.

From http://www.paknews.com/ 07/29/2003

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SBP to Build Strong Database to Check Fraud and Danger of Risks in E-Banking

ISLAMABAD, Pakistan: (PNS) - Measures are underway to build a strong data base in State Bank of Pakistan which will be linked with all banks to promote E-banking, facilitate consumers with an aim to minimize fraud and danger of risk. This was stated by Governor State Bank of Pakistan, Dr. Ishrat Hussain while addressing a seminar on "automation to build confidence" organized by NADRA here at a local hotel on Tuesday. A number of experts presented their point of view on the subject and lauded the services of NADRA for building a computerized national data base for the country. Dr. Ishrat said data base development is helping us to end Ambiguity about the borrowers, as verification system is valid, strong accessible to all banks which will reduce the danger of risks. He said as internet services have been extended to 1000 cities And villages, many banks have started providing E-banking facilities to their customers. He said over 400 ATMs are in operation in Pakistan and the use of ATMs is rapidly increasing. Almost 1 million transactions are now taking place through ATMs every month. He said more and more functionalities are being provided by the banks electronically including E-statements, funds transfers, bill payments for utilities as well as other purchases, on-line application processing, etc. By 2002, almost 40% of the bank branches have been automated and it is expected that this proportion will reach to 50% by the year 2004.

From http://www.paknews.com/ 07/30/2003

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Internet Services: Accord Signed

ISLAMABAD: The Pakistan Telecommunication Company Limited (PTCL) here on Wednesday entered into a service level agreement (SLA) with IT concerns to provide improved internet services to its customers. Federal Minister for Information Technology and Telecommunication Awais Ahmed Khan Leghari presided over the ceremony. Under the SLA, the PTCL is now required to provide high- quality network support data services through the Pakistan Internet Exchange (PIE). The key components of the SLA include network performance, network availability and compensation to customers if the service falls below a specific level. Ahmad Shokaib Sahibzada, director general IT, signed the agreement on behalf of the PTCL while Wahajul Siraj represented COMSATS. The minister said PTCL was the first telecom company in the region which had reached such an agreement. "It is now widely accepted that any telecom and data service provision and receipt should be governed by an agreement, which is essential to define the parameters of the service, for the benefit of both the provider and the recipient," he said. Mr Leghari said the PTCL was improving its customer care services and a new concept of billing would be introduced soon. He said the PTCL had been sitting on the proposal for almost a decade, but now work on the process was being expedited. He said in two or three months, a new mobile sector policy would be announced under which new investors would be encouraged to enter into the cellular sector. In the post deregulation of telecommunication, the PTA is also expected to issue licences to new players in the next two to three months, he added. Earlier, PTCL Chairman Akhtar Ahmad Bajwa said the SLA contained a specified level of service, support options, enforcement or penalty provisions for services not provided, a guaranteed level of system performance as related to downtime or uptime and a specified level of customer support and what software or hardware would be provided and for what fee. He said the PTCL was committing a gradual increase in network availability for the PIE customers. The commitment for network availability was 97 per cent till Sept 30, which would be increased to 99.8 per cent by April 1.

From http://dawn.com/ 08/14/2003

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AFGHANISTAN: Afghanistan Uses Reconstruction Trust Fund to Address Priorities

Kabul - At the request of the Government of Afghanistan, the World Bank, as the administrator of the Afghanistan Reconstruction Trust Fund, signed agreements this week for three new projects designed to help improve the country's telecommunications system; repair its roads and drainage systems and provide credit and other financial services to low-income people.

From http://web.worldbank.org/ 08/06/2003

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IRAN: Greatest Digital Library Becomes Operational

TEHRAN -- The greatest digital library in the field of medical sciences and biological technologies was put into full operation at Iran's Pasteur Institute. A report released by Pasteur Institute quoting head of the institute's data processing center, Farzan Majidfar, said that the library houses a combination of figurative libraries from the world international network (internet) and digital libraries from domestic network. Majidfar, the project designer and executive manager, added that the library makes five million articles and scientific documents accessible to researchers as complete electronic texts with an approximate volume of 60 million WebPages." The accessible data consists of a wide range of basic medical sciences such as molecular biology and medicine, medicinal sciences, immunology, micrology, physiology, medical parasitology and various other sciences associated with biological and biotechnological technologies," he added, IRNA reported. The official said that the library has been developed within three years and the related equipment were designed and installed in several stages in accordance with the latest computerized scientific developments. "Application of firewall technology and fast transmission of data in multiphase internet sites are some of the features of the library," he added. He reiterated that the library currently provides users with access to 300 million WebPages containing full information along with image-21 and added that given the available system facilities, the figure can be raised to four billion.

From http://www.tehrantimes.com/ 08/11/2003

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KYRGYZSTAN: Kyrgyzstan Joined the Visa International Payment System

Kyrgyzstan has joined the Visa International due to the fact that Kazkommertsbank became the first member of this international payment system in this country, KZ-today has been advised in Kazkommertsbank. The main target of the development of pay cards in the region is an increase of cashless transactions in the retail trade sector. Presently, around 80% of transactions in Kyrgyzstan are realised with the usage of cash. Besides, it is planned to use pay cards for pensions and communal services payments. Kyrgyzstan entered the process of joining the Visa International when Kazkommertsbank purchased one of local banks in Kyrgyzstan and sent a request to the Visa about granting the status of an associated member of this system to "Kazkommertsbank-Kyrgyzstan", its branch. Kazkommertsbank-Kyrgyzstan plans to start issuing the Visa cards in October or November 2003. At the first stage it will be Visa Electron cards with a further transfer to the issue of other card products.

From http://www.gazeta.kz/ 08/21/2003

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KAZAKHSTAN: The First Oil Export from New Facilities Commissioned at Karachaganak

Today, on 1 August the president of RK Nursultan Nazarbayev has opened a symbolical tap, through which teh first oil from Karachaganak new facilities flew to the CPC pipeline and further to the European markets, KZ-today correspondent reports. John Morrow, director general of KPO international consortium, said that "when in November 1997 the production sharing agreement was signed for 40 years, including a further development and operations on the field, between RK and Agip (32.5%), BG Group (32.5%), Texaco (20%) and Lukoil (15%), all these companies united to create the Karachaganak Integrated Organisation (KIO). In Kazakhstan KIO operates as Karachaganak Petroleum Operating b.v. (KPO b.v.). The KPO had improve the field production capacities, install new equipment, improve wells and other types of production infrastructure to promote a full realisation of the field potential. We have fulfilled our obligations". J.Morrow observed that "this success is a result of a huge and self-sacrificing work of KPO employees and contractors, as well as a close and efficient co-operation between the KPO, the WKO administration and "KazMunaiGas"NC" CJSC. In his turn the president of Kazakhstan congratulated all "contractors in the first place, investors, all those who worked on this wonderful complex, with a great success, which will serve for the good of our people, in the interests of all those, who invested money into this project". N.Nazarbayev declared that "from today Karachaganak production has an access to the world markets and its volume will grow to 8 million tons per annum". Members of the government of RK, the akim of West Kazakhstan oblast Krymbek Kusherbayev, and heads of KPO four parent companies - "BG Group", Eni, ChevronTexaco and Lukoil took part in the ceremony. As it was reported earlier, the second phase of field development programme had been completed. The conclusion of the second phase means a commissioning of several biggest production facilities: a gas re-injection unit (Unit-2), the KPC with a capacity 7 million tons of liquid hydrocarbons per annum, the export pipeline Aksai-Big Chagan-Atyrau with a length 635 km, connecting to the Caspian Pipeline Consortium (CPC) system heading to Novorossiysk. The KPC will allow to export through the CPC 7 million tons of liquid hydrocarbons per annum, which will be sold on the international market. In general the level of liquid hydrocarbons production at the field will exceed 10 million tons per annum. The development of 3rd and 4th phases will be related with an achievement of successful agreements on the sales of gas.

From http://www.gazeta.kz/ 08/01/2003

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Kazakhstan and Singapore Have Common Interests in Information Technologies

ASTANA (TCA). Recently George Yeo, minister of industry and trade in Singapore, visited Astana. After a talk with Kazakh Prime Minister Danial Akhmetov, he met with his Kazakh counterpart Adilbek Jaksybekov, and then took part in a business forum together with the representatives of Singapore business circles, who accompanied him in the trip. According to George Yeo, he fully agrees with the head of the Kazakh government, who calls on Singapore businessmen to diversify investments in Kazakhstan thus developing cooperation not only in the oil and gas areas alone. The chief of the delegation from Singapore believes that relations with Kazakhstan can be established in other fields as well, and that the oil and gas industry is not the only target of foreign capital interest, though probably it presents the most profitable branch. For instance, the companies of Singapore agree to participate in projects on food product processing, financial services and education, and building up Astana. They are also interested in hotel business prospects and the tourism industry, as well as in the telecommunication and information technology branches, which are developing in Kazakhstan. In turn, Adilbek Jaksybekov, Kazakh minister of industry and trade, acquainted the visitors with the basic positions of Kazakhstan's industrial and innovation policy. The minister proposed to Singapore investors to brisk up their activities in Kazakh engineering and processing industries and agriculture. Besides, he said, it might be reasonable to attract the Singapore side to the establishment of high tech parks and to training Kazakh specialists in the international standards area. The visitors, who had gained an abundant experience in innovations and establishing high tech parks and free economic zones (FEZ), displayed their interest in plans concerning corresponding areas in Kazakhstan. Adilbek Jaksybekov said, that soon five high tech parks and five FEZ's would open in the Kazakh Republic, apart from two existing ones already in Aktau's sea port and on the left bank of the Ishim, in Astana. Therefore potential for Singapore's capital investment are widening. There are five Singapore companies and six Kazakh-Singapore joint ventures already registered in Kazakhstan. The sides also talked over a draft memorandum on cooperation and a draft agreement on investment protection. Both documents are to be signed during Kazakh President Nursultan Nazarbayev's official visit to Singapore this November. During the business forum organized by the Kazakh Ministry of Trade and Industry, the International Agency in Singapore, and Astana City Hall, the visitors said, " Kazakhstan is Singapore's principal business partner in Central Asia." The explanation lies in the economic successes of Kazakhstan and its declaring high technologies a priority. A mini-presentation of investment projects to be implemented in Astana was held for the guests. Rustem Musin, deputy director of the Department of Economy and Small Business Development under Astana City Hall, reported a profound interest in investors in the metropolis, saying that more than three billion dollars had already been invested in it. The city is constantly increasing its investment potential, primarily due to the development of small and medium sized businesses and its building industry. During the last five years the volume of crediting small businesses has risen 17 times. International financial institutions have raised the credit rating of Astana. There are many factors that explain mutual interest between Kazakhstan and Singapore. First of all, the Singapore model has been chosen as a pattern for the strategic development for Almaty as the financial center in Central Asian region. Moreover, Singapore investors have broad experience not only in information technology but also in manufacturing equipment for oil production in sea conditions. In particular, CIS Agriferts company has proper machinery available. This is especially important for developing the Kazakh sector of the Caspian Sea. It is also possible to establish additional air routes between the two countries thus opening one of the shortest ways from Europe to Southeast Asia. Doing so, Kazakhstan hopes to improve its airline industry's infrastructure, which remains underdeveloped so far. It is not by accident that the delegation of Singapore included representatives of companies running airports. Other delegates are specialists in consulting services, logistics, public health, shipbuilding, food production, oil and gas industry, etc. Singapore is considered a country with one of the highest economic freedom levels. According to indexes studying the issues, it ranks with Hong Kong, Estonia, New Zealand, the USA, Holland, Luxembourg, Australia, and Chile, in the world's top ten. We must note that, according to the research organization Heritage Foundation, the author of the index of freedom in economy, Kazakhstan shares with Kyrgyzstan only 125th place. Additionally, Russia ranks as the 132nd in this list, while the Ukraine together with Tadjikistan occupy only the 137th place. Of the other post-Soviet states, Belarus and Uzbekistan are rated even lower (the 148th), and Turkmenistan takes the 150th place. This rating is based on ten key criteria, including free trade, monetary policy, a government's influence on business, the development of "black market," etc. In the World Bank experts' opinion, the rating confirms the fact that a degree of freedom in economy mainly depends on the level of democracy in a country. There is one more rating, which is also of interest- the evaluation of a country's readiness to accept high technologies, which Kazakhstan is seeking. Therefore, last year The Economist Intelligence Unit (EIU) published the list of countries most ready to deal with information technologies and which carry on electronic commerce with confidence. During the investigation, the assumed attractiveness of the economic situation in a country and information about the level of the development of its communications were compared. In this respect, the leaders are the USA and Scandinavian states, including Sweden, Finland, and Norway. Singapore along with Holland, Great Britain, Canada, Hong Kong, and Switzerland also enter the first ten. China, Vietnam, Pakistan, Kazakhstan, Iran, and Iraq are considered least ready for electronic business. (by Rustam Ibragimov)

From http://www.times.kg/ 08/07/2003

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TAJIKISTAN: The Main Library Will Be Computerized

Taking into account a huge role of the National Library of Tajikistan named after Abulkosim Firdoysi in spiritual training of population of the country, development of culture and science, gathering, storage and propagation of national and universal culture, in accordance with the law of RT "about culture", the Government of the country has adopted a Decision. According to the decision, there will be accepted necessary measures for improvement of the current state of the national library named after Firdoysi, for storage and safety of book funds, automation and computerization of the main processes of the libraries activity as well as for capital repair of its building. Since 2004, there is planned a stage-by-stage creation of Internet centre, connection of electronic networks, obtaining bibliographical information with foreign libraries and maintenance of library with modern technical equipment. Expansion of relations with the largest libraries of Russian Federation, Uzbekistan, Kazakhstan and Kyrgyzstan for purposes of cultural cooperation is expected. The Ministry of culture jointly with the Ministry of finance and Ministry of Economics and trade are assigned to develop and to submit the program of further development of libraries.

From http://tajikistan.tajnet.com/ 08/20/2003

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UZBEKISTAN: Slow Pace of Computerization Criticized

Criticism of the slow pace of computerization and Internet use in Uzbek government agencies was heard at a session of the Uzbek government's Coordination Council on Computerization and Information-Communication Technologies, centrasia.ru reported on 11 August, quoting UzA. The date of the council session was not given. According to the report, government agencies were scolded for not developing their own websites and for not making their websites attractive or interesting or informing website visitors what services the agency provides. In addition, the level of computer literacy was described as unsatisfactory in some agencies. UzA noted that as of 1 August, the estimated number of Internet users in Uzbekistan had risen to 353,100, up from 275,000 at the beginning of 2003 and 137,000 in 2001. There are reported to be 186 Internet providers in Uzbekistan, up from 130 at the beginning of the year, but most are located in Tashkent. BB (by Edward Weihman)

From http://www.eurasianet.org/ 08/11/2003

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AUSTRALIA: Howard Says Bush Up to Scratch on Telecommunications

Telecommunications services in the bush were now mostly up to scratch and that was the key issue for country people, Prime Minister John Howard said today. Ahead of the start of parliamentary debate on the full sale of Telstra, he said there was strong support for the full privatisation. "The government has kicked this around a lot and there is pretty strong support to go ahead with the sale and it will be because we have upgraded telecommunications in the bush," he told Sky Television. "I have found going around Australia during the recess that people, whatever their views are on the sale of Telstra, they do believe conditions in the bush have got better. "We have got things more or less up to scratch in the bush as I promised and that is the thing that matters to them." Labor Communications spokesman Lindsay Tanner said a privatised Telstra would be a giant private monopoly too powerful for any government to effectively regulate. He said it would abandon the interest of country Australians and focus on the lucrative big city markets just like the banks. "The National Party understands this. They know this," he told reporters. "Yet they are going to go into the Federal Parliament with their tails between their legs, follow the Liberals, crawl in there and vote for the sale of Telstra. That is a tragedy for country Australia. "It is a tragedy for the people they purport to represent. We call on the National Party to stand up for their constituents who are massively overwhelmingly opposed to selling Telstra." Queensland National Party MP Bruce Scott said Labor in government did nothing to improve regional communications. "In fact they abolished the analog mobile phone service and had no replacement for it," he told reporters. We as a government have lifted the service levels." Surveys run by two rural MPs tend to back the Labor position. A survey in the northern rural NSW electorate of New England shows 98 per cent of people do not want the government to sell Telstra. Independent federal MP Tony Windsor today released a running tally of responses to his survey of constituents which found, as of late yesterday afternoon, that 98 per cent of respondents wanted the government to retain its 50.1 per cent share of Telstra. NSW Liberal MP Alby Schultz said he was receiving more than 100 responses a day to his constituent survey with more than 96 per cent opposing full privatisation.

From http://www.theage.com.au/ 08/13/2003

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Government Signs Security Deal

THE Federal Government has signed onto Microsoft's international program giving friendly powers access to Windows source code for security reasons. Microsoft chief security strategist Scott Charney announced Australia's participation in its Government Security Program (GSP) at a company-sponsored defence symposium in Canberra this morning. "The GSP is a program that Microsoft formed in response to government customer requests and pursuant to certain protections and non-disclosure agreements it gives governments access to the Windows source code," he said. "They also have access to Microsoft developers who wrote the code if they have questions about why the code was constructed in a certain way." Mr Charney said governments needed a better understanding of how Windows works in view of their public safety and security needs. "This program does involve a greater degree of co-operation between Microsoft and the Australian Government largely due to Microsoft making available source code that was previously unavailable," he said. "To the extent that they need to build enhanced security applications on top of Windows, they will have a better understanding of how those applications will integrate." Australia is the 12th nation to join the GSP, which was launched in January, with participants including the United Kingdom, Russia, NATO, China and Taiwan. A further 35 countries are considering whether to join the program. Australia's participation will be managed through the Defence Signals Directorate. (by Karen Dearne)

From http://australianit.news.com.au/ 08/14/2003

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FIJI: Suicide Rate Amongst World's Highest

Fiji now has one of the highest suicide rates in the world. Over the last seven months alone, 60 people have taken their own lives compared to 97 for the whole of 2002. These alarming figures are causing great concerns for various organisations that are trying everything within their resources to try to get to the bottom of the issue. The Ministry of Health had established a suicide task force, but apparently it had not been very successful. Fiji Women's Crisis Center Director Shamima Ali said that they were fighting a losing battle, as Fiji did not possess the expertise to deal with the problem. She added the issue had also got out of hand as there were increasing number of hardships faced by people. Meanwhile the Minister for Health Solomone Naivalu agreed that Fiji does not have qualified councilors who specialize in dealing with people with suicidal tendencies. However, he added that not much could be done, as they had to work with the resources available. - Fijivillage/PINA Nius

From http://www.pacificislands.cc/ 07/31/2003

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FIJI: 30% of Fiji in Poverty

Official figures released in Fiji show that at least 30 percent of the country's population live below the poverty line of 50 US dollars a week. The Fiji Times quotes the deputy secretary of the National Planning Office, Peter Wise, as saying the poverty line has to rise because the inflation rate has increased over the years. Wise refuted statements by the Fiji Council of Social Services that 55 percent of the population is living below the poverty line, describing it as an extreme exaggeration. Wise says the families who fall under the poverty line are not necessarily poor, they are just suffering from financial hardship. He says this is because the surveys do not account for the subsistence lifestyle of rural dwellers. But the Fiji Council of Social Services director, Hasan Khan, says applications from the poor for assistance from civil society organisations have increased tenfold. Khan says NZAid, AusAid and the Canada Fund provide an extraordinary amount of assistance but there is a need for still more funds to help the poor. - Fiji Times/PINA Nius

From http://www.pacificislands.cc/ 08/12/2003

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New Zealand: Unemployment Hits 16-Year Low

Strong migration helped drive New Zealand's unemployment rate to a 16-year low of 4.7 per cent for the three months ended June, new figures showed on Friday. Statistics New Zealand said the seasonally adjusted unemployment rate was down from the five per cent level recorded for the previous three month period, and well below the 5.2 per cent rate expected by markets. The unemployment rate is at its lowest level since December 1987, when it hit 4.2 per cent, said the government-funded agency. The data showed "a reasonably strong" labor market, Statistics New Zealand said in a statement. "More than half of the growth (is) attributable to net gains in permanent and long-term migration." Employment Minister Steve Maharey said the figures were a welcome indication that New Zealand's strong domestic economy was "holding up," while many others were still in difficulties. "We are now experiencing lower unemployment than all our major trading partners," including Britain, Japan, Australia and the United States, he added.

From http://www.hindustantimes.com/ 08/08/2003

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DHBs Report $185m Deficit

The 21 district health boards have posted a $185 million end-of-year deficit, and officials admit there is still a lot to be done to eliminate debt. Health Minister Annette King said last September the expected deficit for the financial year to June 30, 2003, was $175 million, meaning a $10 million blowout on the actual deficit. But Health Ministry spokesman John Hazeldine said that later projections put the deficit at $194 million, which meant the boards reported better-than- planned financial results yesterday. The Government planned to make boards debt-free by 2005-06, he said. A cash injection of $137 million would significantly reduce the deficits next year. Boards would receive a further $19 million in 2004-05. Auckland District Health Board had the biggest deficit, $49 million, and Hutt, South Canterbury and Waikato had small surpluses. Hutt was the best-performing board with a surplus of $565,000. Thirteen of the boards showed improved performances to plan. In addition to extra government funding, boards could also play their part by cutting costs, Mr Hazeldine said. This did not mean patient services would be cut, he said. However, National Party health spokeswoman Lynda Scott said deficits meant hospitals could not afford any new equipment, had to reduce surgery and were unable to pay staff more. New Zealanders were missing out on quality healthcare as a result of the deficits, she said. (by Marianne Betts)

From http://www.stuff.co.nz/ 08/25/2003

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Govt Puts $3.5 Million into New Biosecurity Strategy

The Government has allocated another $3.5 million to biosecurity which will be used to implement a new strategy to stop pests and other organisms getting into the country. Biosecurity Minister Jim Sutton said today New Zealand had probably the best protective systems in the world but they needed constant improvement. The Biosecurity Council has produced the strategy report, which took three years to complete and sets out recommendations, objectives and new ways to co-ordinate monitoring systems. Mr Sutton said sea containers were a priority because about 450,000 arrived each year and posed the biggest risk. New screening measures will be introduced in stages, with the ports of Auckland and Tauranga starting next month. The aim is to have all incoming containers under screening systems by December, and importers will have to provide more detailed information about what is in them. At present about 120,000 high risk containers are screened. The Ministry of Agriculture and Forestry (MAF) is taking overall leadership of the strategy, which director-general Murray Sherwin said marked a new era in biosecurity. Changes involve new management systems, better co-ordination between departments and training for the staff dealing with the new measures. Mr Sherwin said the council's report had identified "impediments" such as fragmented leadership and dispersed responsibility. Mr Sutton said the Government was spending $50 million a year more on biosecurity now than in 1999, and despite intense protection there were still gaps in the system. The council's report identified 33 "incursions" between January 2000 and April 2003. Among the invaders were the saltmarsh mosquito, varroa bee mite, painted apple moth, argentine ant and the lace coral that is damaging the Golden Bay ecosystem.

From http://www.stuff.co.nz/ 08/25/2003

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Stable RMB Exchange Rate Benefits World Economy

Chinese Premier Wen Jiabao said Tuesday that the stable RMB exchange rate helps promote the economic developments of China and its neighbors, as well as the world. Wen was speaking while meeting with Citigroup Chairman Robert Rubin and its would-be CEO Charles Prince. He expounded on the Chinese government's policy on the RMB exchange rate, and said that China has taken notice of the concern of the international community on the RMB exchange rate. "The Chinese government has always held a serious and responsible attitude towards the issue," said Wen. He said that during the Asian financial crisis in 1997, China did not devalue the RMB and maintained its exchange rate, while many countries around China devalued their currencies. China's efforts had contributed to the stability of the economy and financial well being of the region and the world, he said. A nation's exchange rate system and policy should be determined by the nation's domestic economic situation and international income and expenses, the premier said. "A regulated, floating exchange rate system based on market supply and demand as implemented by China complies with the country's current situation." China should further explore and improve the mechanism of China's RMB exchange rate as it goes deeper into financial reform, Wen said. The premier also exchanged views with the guests over the world economic situation and other issues of common concern. Also on Tuesday, China's central bank, the People's Bank of China (PBOC), confirmed that China will keep the exchange rate of its currency stable in the second half of this year. China will "continue to maintain the basic stability of the RMB exchange rate'' and will further improve the mechanism through which the rate is formed on the basis of the existing market-based, managed floating-rate system, the PBOC said in its second-quarter monetary-policy report released on Tuesday. The central bank's rhetoric was unchanged from its usual stance and was the latest government response towards growing international pressure to revalue the currency, also known as the yuan. The United States, Japan and South Korea have called on China to let the renminbi appreciate. They said the currency is undervalued and is increasingly making China's exports cheaper as the US dollar -- to which the yuan is pegged -- keeps weakening. The Chinese Government has said it will improve the rate-forming mechanism and will allow the yuan to float in a broader range but it has given no timetable for doing so. The central bank noted that, in the remainder of this year, the upward pressure on the renminbi is likely to rise further as the slow recovery of the world economy may trigger broader trade protectionism. A United Nations report on June 25 predicted the world economy would grow by 2.25 per cent this year, slightly faster than the 2 per cent recorded last year. The Chinese bank's report said: "The slow growth in the world economy is likely to further reinforce the international propensity for trade protectionism, which will constrain increases in China's exports and heighten the pressure for the renminbi to appreciate.'' The PBOC has already been scaling up purchases of mounting US dollar excesses in the market, largely as a result of strong export rises, to keep the yuan within its usual trading band of 8.2760 to 8.2800. Such dollar purchases have translated into fast-growing supplies of renminbi and have pushed China's money supply to levels where the likelihood of serious inflation becomes a possibility, though a remote one. The central bank also reiterated that it would maintain "a prudent monetary policy'' to support economic growth, although the growth of the broad money supply M2, which covers cash in circulation and all deposits, had quickened to 20.8 per cent in the first half of this year from 16.8 per cent last year. But it called attention to the rapid rises in loans this year and said it would further examine the causes behind them.

From http://english.peopledaily.com.cn/ 08/05/2003

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Progress Made on Asian Bond Market Initiative: Asean Plus Three

MANILA, (Xinhuanet) -- Delegates participating in a just-concluded regional financial forum between Association of Southeast Asian Nations (ASEAN) members and their three Asian neighbors said Thursday that there has been noticeable progress on the Asian Bond Market initiative. Given the complexity of the issues and the varying levels of bond market development in East and Southeast Asia, six voluntary working groups have been established to address specific problems in this area, Philippine Finance Secretary Jose Camacho told reporters before the end of the 6th ASEAN plus three Finance Ministers' Meeting. Top financial officials from the 10 ASEAN members, China, Japanand South Korea met here for a one-day forum to discuss issues of mutual concerns. The six groups focused on issues such as creating new securitized debt instruments, credit guarantee mechanisms, and foreign exchange transactions and settlement. They met in Tokyo, Japan in June this year, and made important progress through in-depth deliberation among ASEAN plus three officials. Camacho, who chaired the ASEAN plus three forum, said a robust primary and secondary bond market in Asia requires a wide variety of issuers and products which could be addressed by means such as encouraging sovereign bond issuance by Asian governments, creationof asset-backed securities markets, and bond issuance by multi lateral development banks in the region. To develop efficient and deep domestic and regional bond markets, Camacho said, there must be a conducive environment for the active participation of both issuers and investors. Asian governments are urged to take into account issues such asprovision of credit guarantees through the use of existing guarantor, the possible establishment of an Asian Regional Guarantee Facility, facilitating foreign exchange transactions, and examining legal and institutional infrastructure. Camacho said earlier that he was sure there will be "good progress in our continuing discussions" on developing a regional bond market, which is among the top agenda of Wednesday's intra-ASEAN meeting and Thursday's talks between ASEAN ministers and their counterparts from China, Japan and South Korea. The Asian Bond Fund is designed to harness Asia's vast foreign reserves, estimated at 1.2 trillion dollars, to invest in local-currency bonds and reduce the region's dependence on US and European debt markets. Analysts said most Asian central bank reserves are currently invested outside the region, particularly in US bonds, meaning Asian savings are financing investment and spending in the major economies rather than in Asia. This not only holds back regional economic development but also increases the risk of volatility if banks need to cut credit lines as happened during the 1997-1998 financial crisis.

From http://news.xinhuanet.com/ 08/07/2003

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ASEAN Ministers Adopt Plan for Regional Financial Integration

Southeast Asian finance ministers agreed here Thursday to open up their capital markets further and ease money flows as part of plans toward a single market in the region. The Association of Southeast Asian Nations (ASEAN) ministers adopted the "road map for integration of ASEAN in finance" that would serve as a cornerstone for a regional common market by 2020, according to a joint statement at the end of their annual talks in Manila. It comprises broad steps to develop, liberalize and integrate the region's capital markets and financial services to bring about "a free flow of goods, services and investments and a freer flow of capital," the statement said. Philippine Finance Secretary Jose Isidro Camacho, the meeting's chairman, told a press conference the plan would be tabled for approval by ASEAN leaders at their annual summit in Bali in October. ASEAN aims to achieve a single market - dubbed the "ASEAN economic community" - of 530 million people in 17 years. The group comprises Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam. The ministers also said in their statement that they expect economic growth in the region to be higher at 4.3-4.9 percent in 2003 from 4.4 percent last year despite possible investor fallout from this week's deadly Jakarta bombing. They urged investors not to let this "isolated incident" affect their confidence in the region. The ASEAN ministers together with their counterparts from China, Japan and South Korea, whom they met separately Thursday, issued statements condemning the terrorist car bomb attack on the JW Marriott Hotel in Jakarta's business district on Tuesday which killed at least 10 people and injured 147 others. The finance ministers also agreed to simplify customs procedures to hasten regional trade and called for a wide variety of bond issuers in Asia and the strengthening of the bond market infrastructure in the region. This was part of efforts to better utilize "Asian savings for Asian investments" in the bond markets, Camacho said. Officials said capital market integration under the plan for financial integration in ASEAN would be undertaken in two phases, considering different levels of development in the financial fronts of member states. Camacho said the first phase would be mostly confined to "institutional capacity building," including beefing up the legal and regulatory framework and market infrastructure for trading and adoption of international standards. The second phase will involve greater cross-border collaboration among capital markets in the region and harmonization of capital market standards. The ministers stressed they would take "an orderly approach" to liberalizing their capital accounts with adequate standards against market volatility and systemic risks. Much of Southeast Asia's financial sector is still recovering from the 1997-1998 financial crisis, which plunged the region into its worst recession in decades.

From http://www.chinapost.com.tw/ 08/08/2003

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Asian Bond Fund Not Just A Pipe Dream

There's little hype. Certainly no fanfare. But quietly and with infinite patience, Asia's economies are hoping to bond together. In June, 11 Asia-Oceania central banks announced a plan to create a $1 billion fund to invest in Asian government and quasi-government bonds. The central banks, including those of Japan, Australia and New Zealand, hope to lure local capital into China, Hong Kong, Indonesia, South Korea, Malaysia, the Philippines, Singapore and Thailand. If and when the Asian Bond Fund gains momentum and bond markets grow, the fund will operate in a basket of local currencies. The idea is to siphon excessive savings in Asia away from U.S. Treasury bonds and other dollar-denominated assets, and bring them directly to local businesses. The Bank of Japan has so far put $100 million into the fund, which is managed by the Swiss-based Bank for International Settlements, known as the central bankers' bank. "It's going to take years of small steps to bring about an attractive bond market in Asia," said Akinari Horii, director general of the BOJ's International Department, adding that the central banks are doing this quietly. "Personally, I don't like propagandizing." Critics say there's a reason for Horii's reticence: at first glance, it appears the fund could leave the U.S. government in a lurch. Foreign reserves in the Asia-Oceania region grew from $800 billion in 1999 to nearly $1.5 trillion now, with the world's seven biggest holders of dollar reserves in Asia. Take that money away, and the U.S. government may have problems financing its debt. Japanese central bankers and Finance Ministry officials pooh-pooh such concerns, however. "Foreign investors and hedge funds currently investing in Asia will move more funds back into U.S. Treasuries," one senior Finance Ministry official said. "Money is fluid." The BOJ's Horii said the general response from the U.S. Federal Reserve Board, the BOJ's counterpart, was enthusiastic. Currently, the money that flows out of Asia into the U.S. comes back in investments and loans, allowing U.S. investment banks to dominate Asia's bond markets, which are worth $50 billion. The figure excludes Japan. That money could simply flow back. The fund is a necessary step but insufficient as a means to protect Asia, said Takatoshi Ito, professor of economics at the University of Tokyo and a former deputy general at the Finance Ministry. "Asia remains open to currency and liquidity risks that could cause a repeat of the currency crises of 1997," he said. The Asian Bond Fund is useless as a shield to Asian markets as long as it remains dollar-denominated and a passive investor, he added. It could be years before the fund can begin buying corporate bonds in local currencies. The fund involves China, which has yet to develop a bond market, and whose currency is pegged to the dollar. Meanwhile, speculative sovereign credit ratings of member nations go as low as Indonesia's C rating. "You have to train in the minor leagues before you can play in the majors," Horii said. Nonetheless, U.S. investment banks have already expressed interest in buying more Asian bonds, according to sources close to the fund. Mitsubishi Tokyo Financial Group Inc., which is seen as the most likely Japanese bank to participate in the scheme, declined comment. Other Japanese banks have so far expressed little interest. "Frankly, we can't afford it," said a representative of Mizuho Corporate Bank, citing limited short-term returns. Following record losses in fiscal 2002, five major Japanese banking groups are under special watch by the Financial Services Agency to increase profits in the current business year, or risk changes in management. "If Japanese banks are unwilling, we'll just go ahead without them," Horii said. "It's their loss over the long term." As for Japan's individual investors, it will be a long time before they start buying up continental Asian corporate bonds, said Sadakazu Osaki, an analyst at Nomura Research Institute. "They still remember being burned by the Asian crisis." (by Mayumi Negishi)

From The Japan Times 08/15/2003

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CHINA: Credit System Monopoly Fear Rises

Chinese experts and credit management firms are calling for concerted efforts among various government agencies while building the country's badly needed social credit system. They have expressed worries over rivalry within the government and suspicions that the central bank is attempting to monopolize credit data and services, which they warn would only hamper China's effort to restore confidence in commercial credit. A handful of government agencies, including the National Development and Reform Commission and the Ministry of Commerce, are reportedly drafting their own social credit system plans in a bid, insiders say, to grasp leadership in the country's massive campaign to build a social credit system that ranges from database compilation and business credit management to fostering a credit-valuing culture and related legislation. The newly established Ministry of Commerce appears to be leading the charge. Insiders say the National Leadership Team on Regulating the Market Economic System -- the decision-making body authorized by the State Council to oversee the construction of the social credit system -- is based at the ministry. "No matter who the regulators are, we will toe the line," said a senior manager at a major credit management firm. "We just hope it's decided as early as possible." Much dissatisfaction is focused on the central People's Bank of China (PBOC), which is reportedly considering setting up a credit management bureau within its structure and, more to the frustration of credit management firms, has drafted a credit management regulation they say is likely to lead to a monopoly. Insiders say the regulation, which was completed last year, requires credit management companies to have a minimum of 100 million yuan (US$12 million) in registered capital, a threshold none of China's some 500 credit management firms, most of them privately-owned, can presently meet. "It's unfair," said a manager at a private credit management firm. "We've been in the business for 10 years but we don't see why we need that much registered capital." Some media reports said the PBOC was putting together a credit management firm with investment from the four largest state-owned commercial banks, which would presumably have no problem meeting the capital requirement. And the new firm will likely be given enviable access to what is said to be China's largest credit information database, covering more than 300 cities, which the central bank has built up over the years. A PBOC official declined to comment, but reiterated earlier statements that it is building an "enterprise and individual credit management system." Analysts say a social credit system is badly needed in China where debt defaults are commonplace and many companies have a "give-me-a-good-rating-and-tell-me-how-much-you-want" attitude towards credit rating firms. And legislation is currently the most urgent task, as China still has no law specifically governing credit management issues. It is crucial to the development of consumer credit and account sales,which make a growing contribution to economic growth, said Pu Xiaolei, deputy director of the Credit Management Department under the Chinese Academy of International Trade and Economic Cooperation -- the Ministry of Commerce's think tank.

From China Daily 08/04/2003

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WB Official: Calls to Appreciate RMB 'Groundless'

The calls for China to strengthen the official currency of Renminbi are "groundless", Zhang Shengman, managing director of the World Bank, said in a speech at an international financial forum held in Shanghai. Although China's trade surplus to the United States reached about US$100 billion, China's total trade surplus was about US$30 billion, only one-fifth of the total of developing countries, said Zhang. The rapid increase of China's exports is the result of global manufacturing relocation, which means that some increased production in China is not newly-added production but was moved from Malaysia or Thailand, said Zhang. "In addition, the exports of China only account for 5 percent of the global total, so it is unbelievable that China's increasing exports caused global deflation," he said. However, Zhang suggested that some kind of mechanism for changing the exchange rate of the Renminbi be developed in the future, depending on China's economic circumstances, such as widening the fluctuating range of the Renminbi. Meanwhile, a leading Chinese banking expert says China should maintain a stable exchange rate policy, warning that drastic amendments of the reform process would adversely affect the national economy. Tang Xu, director of the Graduate School of the People's Bank of China, said that China's exchange rate system was appropriate to the country's financial situation. The stable currency policy enabled China to successfully stabilize the Renminbi and withstand the impact of the Asian financial crisis in 1997. To a profound extent, the stability of the exchange rate safeguarded the country's daily financial operations, stressed Tang. After 1994, fundamental changes were seen in China's foreign exchange system, as the government merged the "official" and market exchange rates into a unified one based mainly on market demand and supply, under a single, managed floating exchange rate system, Tang said. The gradual and evolutionary reform of China's exchange rate system also helped establish foreign investors' faith in the value of the RMB and consolidate their determination to boost investment in China, he said. If China freed the exchange rate, the speculative "hot money" would advance into the country's foreign exchange market and the RMB would surely fluctuate severely, Tang said. "It would be a disaster, since China's financial capability to withstand the exchange rate upheaval is so weak," Tang said, warning that the regular financial operations would be in disorder. China, unlike developed countries whose financial sectors are able to prevent and dissipate exchange rate risks, would bear too much risk to let the RMB float freely, Tang said. He suggested that China continue to focus on the establishment of risk management mechanisms within the banking system and improve corporate governance. However, Tang also agreed that a stable exchange rate did not necessarily mean a fixed one. He predicted that RMB could eventually be convertible under the capital account. "There is no timetable for realizing the RMB's convertibility under the capital account, but at the right time, there will be one," Tang said.

From China Daily 08/10/2003

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HK Banks to Open RMB Services

Hong Kong banks will open their renminbi services in the near future, according to a Beijing-based newspaper. The Business Post Monday quoted unidentified banking sources as saying representatives from the central People's Bank of China and the China Banking Regulatory Commission will go to the Hong Kong Special Administrative Region next month to consult with local officials on the scope of the services -- which may include deposits, remittance, exchange and credit card services -- and the mechanism for currency flowing back to the Chinese mainland. The central bank said earlier it had been working on rules in relation to opening the services since last year and had been conferring with related government agencies. Research by investment bank UBS estimates the value of renminbi in Hong Kong to be over 57 billion yuan (US$6.9 billion). It is expected to reach 157 billion (US$19 billion) by 2005.Yi Xianrong, a researcher with the Chinese Academy of Social Sciences, said most of the renminbi in Hong Kong is now circulating through underground exchanges. The transactions could be part of illegal activities such as money laundering, he said. The opening of personal renminbi business will channel the cash in the "grey area" into an official system, Yi said." This will also cut the cost of renminbi-related transactions and will help strengthen the regulation of these transactions," said Yi, who is part of a team conducting research on banking co-operation between the mainland and the special administrative region. Zong Liang, a researcher with the Bank of China's International Finance Institute, said a key issue in opening the services is settlement, which requires co-ordination from the authorities. The efficiency of settlement will influence the renminbi's return to the mainland, Zong said. The Hong Kong Monetary Authority was reported to be willing to act as the settlement bank. Zhong Wei, a professor with Beijing Normal University, suggests a mainland-backed bank should be designated as the settlement house for other Hong Kong banks conducting renminbi business. The prospect of Hong Kong banks engaging in renminbi business also prompted discussion about the region's chances of becoming a center for offshore finance in renminbi. But Yi said that was still far away. Offshore finance refers mainly to banking business operating outside the official territory of a currency. Yi said the prerequisite for forming an offshore center for a currency was the full convertibility of the currency. When a currency is not convertible under the capital account -- as the renminbi is at the moment -- it is impossible to carry out loan business in the currency, Yi said.

From China Daily 08/12/2003

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Shanghai Bank Launched Rate Monitoring System

Shanghai branch of People's Bank of China, the nation's central bank, has taken the lead nationwide to publish its interest rate monitoring and information revealing regulation, International Financial News reported on Aug.14. United with Nation Interbank Funding Center, it has developed an interest rate monitoring computer system based on the regulation, the same report said. The system has started operation since this month on www.Chinamoney.com.cn, the joint official website of the interbank funding center and China Foreign Exchange Trade Center. The rate monitoring system is aimed at providing an interactive platform between the central bank and the financial institutions as well as setting good order for the local financial market, the regulation states.

From Eastday.com 08/14/2003

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Banking Watchdog to Set New Capital Adequacy Standards

A new regulation on capital adequacy standards for commercial banks will be introduced this year, the China Banking Regulatory Commission (CBRC) announced yesterday. The regulation, the first of its kind, will be based upon the 1988 version of the Basel Accord, the international banking industry's regulatory benchmark. But it will also draw on a new version of the accord that is expected to be finalized by the end of this year, it said. The regulation will retain an 8 per cent minimum capital adequacy ratio requirement, but will also include requirements for supervision and information disclosure, two extra elements in the new accord. The accord is only binding for "internationally active" banks in 10 developed countries, but is used by banking regulators worldwide as a reference. Most Chinese banks would find it difficult to meet the 8 per cent requirement. Insiders said the new accord, which generally has stricter rules on the calculation of risk-weighted assets, may decrease their capital adequacy ratios by an average of 2 percentage points. The banks are seeking ways to raise the ratio, their key barometer of risk management capacity. They have lobbied the government for a recapitalization as well as bond issuances, but have made little progress so far. "Our continued use of the old accord is based on the reality in China," a CBRC spokesman said in a statement. Implementing the new Basel Accord in China now is unlikely to considerably enhance its management of risk, but will push up capital requirements for the country's banking industry, he said. The commission said China will not consider applying the new accord by the end of 2006, its implementation date in the 10 developed countries. But China will embrace the accord as an opportunity to improve risk management in its commercial banks. "The new capital accord will provide our banking industry with a new look and new opportunities," the spokesman said. Major Chinese banks have started building risk management systems in compliance with the new accord, and smaller banks are also actively seeking input into the new accord. "Considering that only part of the Chinese banking industry has started implementing the five-category loan classification system (an internationally accepted loan classification method), the propensity among commercial banks to actively use the new accord for reference and to improve risk management is encouraging," the spokesman said. The spokesman said the new accord may cause "negative impacts" on capital flows in developing countries. He said it also may put emerging market commercial banks, especially their overseas branches and affiliates, at a competitive disadvantage, but did not elaborate.

From China Daily 08/15/2003

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Central Bank in China Raises Reserve Requirement

China's central bank has raised the reserve requirement for financial institutions to stem rapid lending growth.The People's Bank of China (PBOC) said at the weekend that from September 21, the deposit reserve ratio would be raised from 6 per cent to 7 per cent.The ratio was adjusted significantly in 1998 when it was reduced from 13 per cent to 6 per cent in an effort to stimulate the economy during the Asian financial crisis.The PBOC statement said: "The Chinese economy has had a good start this year . . . but all regulatory departments agree there is an excessive increase in the current monetary lending."The PBOC said the move was modest and would not cause overall lending to decrease this year. It is viewed as a response to the overheating of some parts of the economy.Cheng Dinghua, of China Everbright Securities in Shanghai, said the central bank had few options because recent verbal admonishments against excessive lending had proved ineffective, and raising interest rates would have been too blunt an instrument.He said: "Central bank officials are like reservoir supervisors - if the water flow is excessive for several consecutive months, they get worried about flooding in some areas."Increasing interest rates could also heighten already growing speculative purchases of the renminbi.The purchases have been prompted by pressure from China's big trading partners, the US and Japan, for a revaluation of the currency to stem the fast growth of Chinese exports.Inflows of foreign currency into China have added to banks' deposits and their ability to lend.In its statement, the PBOC promised to keep lending and deposit rates stable for the rest of the year and reiterated its support for the maintenance of the renminbi-US dollar peg.Some change in the increase in reserve requirements was expected after a Chinese official, Ma Kai, warned this month of over-investment in a number of sectors, including cars, real estate, aluminium smelters and steel.The adjustment of the deposit reserve requirement in effect drains the banking system of potential assets by forcing it to keep more money on deposit at the central bank.The PBOC said it expected the adjustment to remove about Rmb150bn (?16bn, ¡ê11.5bn) from the system. Mr Cheng put the number higher, at about Rmb200bn. (by Richard McGregor)

From FT.com 08/24/2003

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JAPAN: Budget Cuts Take Back Seat to Electioneering

Critics say the latest sop to constituents will leave state finances in dangerous disarray. Eager to appease constituents ahead of the next Lower House election, senior government and ruling coalition officials have agreed not to call for drastic spending cuts in the fiscal 2004 budget. Critics, however, say a lack of bold spending cuts may jeopardize state finances, over 40 percent of which are paid for by debt. Spending is expected to snowball due to growing social welfare costs as the population ages. Officials agreed Thursday to cap budgetary requests for main allocations submitted by government bodies by the end of August at 48.1 trillion yen. The agreement on a budget allocation framework differs little from that of last year. Observers say Liberal Democratic Party heavyweights opted not to drastically cut expenditures for fear of turning away party supporters ahead of a Lower House election expected this autumn. The budget has already been set to feature only slight cuts, even though the government is yet to figure out how to finance the spending. The 3 percent cut in public works spending featured in the budgetary plan, for example, is a retreat for Prime Minister Junichiro Koizumi and his Cabinet, which came to power in 2001 under the banner of fiscal reform. The Koizumi Cabinet imposed a 10 percent cut in public works outlays for the 2002 budget, while introducing a 30 trillion yen cap on new issuance of government bonds. ``If rehabilitation of state finances is the issue, the budget plans are outright lax. But the economy is still in a slump and we can't turn to drastic cuts,'' said a senior Finance Ministry official, arguing instead for phased belt-tightening. Ruling coalition politicians with ties to social welfare interests also had a hand in the latest decision on the budget. They defeated the Finance Ministry's initial plan to cut over 300 billion yen in allocations to cover an expected increase in social welfare costs. The reduction will now total 220 billion yen. Officials did not even mention the possibility of cutting state reimbursements on medical bills. Such cuts would likely provoke protest from the Japan Medical Association, a major supporter of the Liberal Democratic Party. Analysts, however, warn that a lack of drastic spending cuts is dangerous, given the decline in tax revenues and a possible fall in government bond prices. Tax revenues for fiscal 2002 reached only 43.8 trillion yen, or 3 trillion yen short of the initial forecast, due to the slumping economy. The Finance Ministry is already forecasting a further fall in tax revenues, to 41.8 trillion yen, in fiscal 2004. Unless there are further cuts in general expenditures, the government may have to raise as much revenue from newly issued bonds as it does from taxes. The latter is normally the core portion of government revenues. Outstanding government bonds totaled some 450 trillion yen at the end of March. Much of that total was issued to pay for repeated fiscal pump-priming measures in the 1990s. The government has in the past been able to turn to bonds to help finance its expenditures, thanks to ultra-low interest rates and a slumping stock market that made the bonds more popular. Rising stock prices are now making equities more attractive to investors, and may therefore make it difficult for the government to issue more bonds. The aging of society, meanwhile, is expected to push up the government's social welfare costs, including those for the public pension and medical insurance systems, by nearly 1 trillion yen each year. A Finance Ministry official said a hike in the consumption tax is so far the only feasible way the government can raise additional revenue, but Koizumi has ruled out that option.

From http://www.asahi.com/ 08/01/2003

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Banks Fail to Lift Small-Firm Lending

Mizuho Financial Group Inc., Sumitomo Mitsui Financial Group Inc. and six regional banks reduced their lending to small and midsize firms in fiscal 2002, despite pledging to increase such lending in exchange for receiving public fund injections, the Financial Services Agency said Thursday. All eight banks have received public funds in the past to shore up their capital. Increasing loans to small and midsize companies was among key pledges made by the banks in order to receive injections of public money. The FSA said it will ask the banks why such lending decreased and what kind of measures they will take to increase it. The agency will also intensify monitoring of Mizuho and SMFG. Mizuho cut lending to small and midsize companies by 5.63 trillion yen and SMFG did so by 729.7 billion yen, the FSA said. The six local lenders, including Hiroshima-based Momiji Holdings Inc. and Hokkaido Bank, cut such lending by a combined 152.9 billion yen. In contrast, four other major banking groups or banks that have also received public funds increased their lending to small and midsize firms. UFJ Holdings Inc. increased such lending by 401.4 billion yen, Resona Holdings Inc. by 235.1 billion yen, Mitsui Trust Holdings Inc. by 41 billion yen and Sumitomo Trust & Banking Co. by 20.9 billion yen.

From The Japan Times 08/08/2003

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31 Tokyo Banks Taxed 92.4 Billion Yen

Thirty-one banks operating in Tokyo paid a combined 92.4 billion yen to the Tokyo Metropolitan Government as local tax based on their revenues in fiscal 2002, which ended March 31, metro government sources said Friday. The tax imposed exclusively on banks has been declared illegal twice by courts, but the metropolitan government is continuing to collect it, pending a decision by the Supreme Court. Some of the banks submitted a letter, along with the tax payment, to the metro government saying the payment does not mean they regard the tax as legitimate. The metropolitan government in April 2000 put the tax into force for five years.

From The Japan Times 08/09//2003

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Finance Ministry to Cut Loan Rates

The Finance Ministry said Monday it will cut some of its rates for loans to governmental lending institutions on Wednesday. Among the rates to be reduced is that for loans to Government Housing Loan Corp., which will be cut by 0.1 percentage point to 1.2 percent. The corporation is expected to review its housing loan rates in light of the rate cut by the Finance Ministry. The ministry raised its lending rates for government-backed institutions in July after sharp rises in long-term interest rates in the market. But it decided to trim the rates, following the recent stabilization in market rates. The Finance Ministry loan rate for the Development Bank of Japan will also be reduced by 0.1 point to 0.9 percent per annum. The ministry extends loans to governmental lending agencies using funds raised through government bonds issued under the government's financial investment and loan program.

From The Japan Times 08/12/2003

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Major Banks Trying to Track Down and Terminate Loan Shark Accounts

Major commercial banks have started to take a tougher stance against loan sharks, with some setting up task forces to monitor suspicious accounts and canceling those held by illegal moneylenders, according to a recent Kyodo News survey. The five major banks surveyed said they are checking accounts believed to be used by loan sharks to collect money after lending at exorbitant rates of interest. The survey asked Mizuho Bank, UFJ Bank, Resona Bank, Bank of Tokyo-Mitsubishi and Sumitomo Mitsui Banking Corp. how they deal with such suspicious accounts and other problems they face. Most of these accounts are concentrated in certain branches, and if banks acted widely against illegal lenders, the effect would be beneficial, said Kenji Utsunomiya, a lawyer heading a nationwide panel acting against loan sharks. Mizuho set up a task force last month to check on accounts it suspects might be used for criminal activities. Also this year it introduced stricter rules on cancellations and suspensions of transactions. The bank canceled about 80 suspicious accounts during the April-June period, compared with nearly 90 accounts in all of fiscal 2002. For its part, UFJ established a task force at its Tokyo headquarters and by the end of July had canceled about 160 accounts allegedly held by loan sharks. The bank also tightened its preliminary reviews of people seeking to open new accounts. But the survey also showed the difficulties the banks face, the limits on what they can do on their own and the necessity of cooperating with police and other administrative bodies. UFJ said it cannot easily confirm if applicants have produced real identification documents because the institutions responsible for issuing such papers mostly reject the bank's inquiries on the grounds of protecting personal information. Pointing out the difficulty in deciding whether an account is being used for criminal activities, Resona said, "We hope to strengthen cooperation with police and other institutions." Loan sharks are a serious social problem and have recently been receiving greater media attention. The National Police Agency said about 166,000 people were victims of usury in the first six months of 2003, more than in all of 2002. Police handled 229 cases of illegal lending and loan collection, up by about 170 percent from the corresponding period last year, and mobsters were involved in 56 of the cases. They arrested or sent to prosecutors 469 people, up about 180 percent. The lenders meanwhile pocketed an estimated 17.37 billion yen in profits, up about 160 percent. On Monday, a former senior member of Yamaguchi-gumi, the nation's largest underground syndicate, was arrested on suspicion of organizing and overseeing about 1,000 illegal loan sharks. Susumu Kajiyama, 53, allegedly violated the investment law by overseeing moneylenders who charged unlawfully high interest rates.

From The Japan Times 08/15/2003

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SOUTH KOREA: Banks' Bad Loan Ratios Surge in First Half

SEOUL - Bad loans at South Korean banks jumped in the first half as large amounts of corporate loans and credit card bills turned sour, banking sources said today. Chohung Bank (KSE:00010), the nation's fourth-largest lender, saw its ratio of bad loans to total lending surge to 4.41 per cent at the end of June from 3.75 per cent from three months earlier. This included Kookmin Bank (KSE:60000), which saw its bad-loan ratio shoot up to 4.35 per cent in June from 3.38 per cent in March. Shinhan Bank's bad-loan ratio also rose to 2.55 per cent in June from 1.47 per cent in March, while Hana Bank (KSE:02860) saw its bad-loan ratio climb to 2.74 per cent from 1.88 per cent.

From http://www.asiapulse.com/ 08/15/2003

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Foreign-owned Stocks Account for 37.5 % of Korean Bourse in July

Foreign-owned stocks amounted to 296.5 trillion won, or 37.5 percent of total market capitalization of the Korea Stock Exchange (KSE) at the end July, a jump of 1.9 percentage point from a month ago. The ratio was the highest since January 1992, when the main Korean bourse was opened to foreign investors. Foreigners purchased a total of 9 trillion won worth of shares and sold 6 trillion won on the KSE in July, according to the Financial Supervisory Service. The net selling of 3 trillion won was the third consecutive position since May. It has brought the market capitalization of shares held by foreigners to 111 trillion won, up 13.5 percent, or 12.2 trillion won, from the previous month. The increase was largely attributed to a 6.5 percent gain in the Korea Composite Stock Price Index (KOSPI) in June as well as the net selling of 3 trillion won worth of shares. The number of foreign stock investors increased by 79 - 19 individuals and 60 institutions - in July for an aggregate total of 14,717 (5,134 individuals and 9,583 institutionals). Meanwhile, foreign-owned stocks in the lesser KOSDAQ (Korea Securities Dealers Automated Quotations) Stock Market accounted for 11.4 percent, or 4.9 trillion won, of total market capitalization of 43 trillion won in July. The ratio also marked the highest since September 1996 when KOSDAQ was opened to foreigners.

From http://www.kois.go.kr/ 08/18/2003

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KEB Forms BESETO Banking Alliance

Three major banks from Korea, China and Japan yesterday formed a business alliance both in international and foreign exchange sectors, in a move to boost cooperation in the Northeast Asian region. The Korea Exchange Bank (KEB) announced yesterday that it signed a contract to launch a Northeast Asian conference group called BESETO Bank Summit to promote financial cooperation between the three nations. BESETO's name comes from the first two letters of the three respective capital cities: Beijing, Seoul and Tokyo. Held at Lotte Hotel in downtown Seoul yesterday, the signing ceremony was attended by KEB president Lee Kang-won, Bank of China vice president Zhang Yanling and Sumitomo Mitsui Banking Corp. board chairman Akishige Okada. Through the strategic alliance, the three banks seek to solidify a cooperative relationship in foreign exchange settlement and e-trading systems with the co-use of ATM (automatic teller machine) machines. At the same time, the three will make joint efforts to establish an IT network and a mutual transaction base suitable to execute future trade and finance activities via e-Trade, a new business model anticipated for the future export-import transactions They also agreed to execute comprehensive financial solutions, including investment and project financing when investments are made into one of the three participating countries. The three banks further agreed to actively exchange and share human resources and other intellectual know-how with a view to advance the financial communities in Northeast Asia. ``We believe the alliance will help each of us improve competitiveness and profitability, reduce risk and increase market share,'' KEB president Lee said. ``Banks engaging in international business need to form a cooperative relationship with foreign banks,'' he added. ``Given the amount of trade between the three nations, this trilateral tie-up is very meaningful.'' ``First of all, we will focus primarily on cooperation in the foreign exchange business and plan to expand into joint product development and investor relations later on,'' he said. To effectively meet the objectives of the business alliance, the state-run KEB newly launched a task force called the Northeast Asian Team to further study and promote detailed plans for even closer cooperation between the three banks. ``The trilateral tie-up will contribute not only to the financial development of the Northeast Asian region but also to the Korean government's efforts to transform Seoul into a financial hub in the region,'' Lee said. The three banks will hold the second BESETO summit either in China or Japan next year. (by Kim Jae-kyoung)

From The Korea Times 08/18/2003

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Seoul Falls Behind Tokyo, Shanghai as Financial Hub

Seoul is lagging behind Tokyo and Shanghai as a financial hub in Asia, because of the nation's restrictive legal and regulatory systems, according to McKinsey & Company. In its latest survey, the global consulting company found that Seoul currently ranks third as a financial hub in Asia along with Beijing, behind Tokyo and Shanghai, as well as Singapore and Hong Kong. ``In Asia, Hong Kong and Singapore are the current leaders with Singapore having made the most significant efforts over the last 5 years,'' McKinsey & Company Asia-Pacific chairman Dominic Barton said. ``Shanghai, Tokyo, Beijing and Seoul are also deeply interested,'' he added. ``I believe that over the next 5 years the overall ranking will change significantly.'' Citing the survey, Barton pointed out the strong points of Seoul as a financial hub are improved infrastructure and strong economic recovery. On the other hand, restrictive legal and regulatory system, volatile currency and capital markets and poor English language skills are negative factors, he added. He stressed that the most urgent task for Seoul, Tokyo and Beijing to emerge as a financial hub is to reform legal and regulatory systems, both in private and public sectors. Also, they need to aggressively promote widespread use of English, lower taxes to globally competitive levels, increase labor market flexibility and workforce quality, begin to liberalize currencies and internationalize legal services market, he added. ``Improving each of Beijing, Seoul and Tokyo's ranking and positioning is in all of our interests,'' Barton said. ``This is not a competitive or zero-sum game, because the spill-over benefits for all of us in these 3 countries are huge.'' He pointed out that there are complementary needs in each country, noting Japan has a rapidly aging population, while Korea and China have relatively younger populations. He added China has a huge need for capital, as does Korea, while Japan is one of the largest suppliers of capital in the world. (by Kim Jae-kyoung)

From The Korea Times 08/19/2003

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Tax, Social Security Contributions Hit Record High of 28% of GDP

The burden of tax and social security hit a record high of 28 percent of gross domestic product (GDP) last year. According to the Ministry of Finance and Economy yesterday, Koreans paid 166.9 trillion won in taxes and other social security contributions in 2002, up from 149.8 trillion won in 2001. The tax and social security contributions accounted for 17.8 percent of GDP in 1985. But it rose to 20.1 percent in 1994, 22.9 percent in 1998, 23.6 percent in 1999, 26.1 percent in 2000, 27.2 percent in 2001 and 28 percent last year. Korea recorded the fastest growth in tax and social security contributions among OECD countries since Korea joined the international organization. Despite the hike, Korea's social welfare system has not improved noticeably. The average tax and social contribution ratio of OECD countries reached 28 percent in 2000. Sweden topped the list with 53.3 percent, followed by Denmark with 48.4 percent. The ratios in the U.S. and Japan were 28.9 percent and 27.1 percent, respectively. Per-capita payment for taxes and social security payment in Korea also surged to 3.5 million won last year from 2.2 million won in 1998. In addition, the nation's tax burden ratio, the ratio of total national and local tax revenues to GDP, is expected to rise by 0.2 percentage point to 22.9 percent this year with the passage of the proposed supplementary budget worth 4.2 trillion won. The Korea Development Institute (KDI) forecast Korea's tax and social security contributions is likely to go through the 30-percent level versus GDP in the near future. (by Kim Yon-se)

From The Korea Times 08/19/2003

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INDONESIA: Govt Insists on Maintaining High Forex Level

The Minister of Finance, Boediono, said on Friday that the government would stick with its original plan to repay the International Monetary Fund loan in seven years, turning down a suggestion from the House of Representatives, that the government should take advantage of the country's relatively high foreign exchange reserves to complete the plan in three years. Boediono said that the economy would still need to maintain high forex reserves amid lingering uncertainties, particularly in 2004, when the country holds general elections. "2004 will be a crucial year filled with many uncertainties, in the economy, politics, and security. So we must be ready with sufficient forex reserves," he told reporters. The Chairman of the House Budget Committee, Abdullah Zainie, was quoted by Kompas daily as saying that, the House recommended that the government cut the country's debt to the IMF to below the member quota level of around $3 billion by 2006 -- so that the Fund could no longer influence the country's economic policies. Under the House proposal, the government would have to allocate more than US$2 billion each year for installments. The country's debt to the IMF would, therefore, reach $9.8 billion when the existing IMF bailout program ends this year. Under the government's repayment plan, annual installments would be less than $1 billion, with the aim of decreasing the debt to below the quota level by 2010. The government will not extend the current IMF program when it expires at the end of this year, but has decided to maintain the Fund's monitoring role via the post program monitoring arrangement (PPM), under which the government must discuss its economic policies with the Fund. President Megawati Soekarnoputri is expected to unveil the country's post-IMF economic reform policies on Aug. 15 with the 2004 state budget. Some experts have said that the termination of the IMF program would expose the economy to various risks, largely the absence of a debt rescheduling facility (from the Paris Club of creditor nations). This would cause a serious fiscal threat unless the government found alternative funding sources. One alternative is for the government to tap the overseas financial market by issuing bonds. Analysts have said that it is crucial for the government to maintain investors confidence by pushing ahead with tough economic reform programs. Meanwhile, Bank Indonesia senior deputy governor Anwar Nasution also said that it would be wiser for the government to maintain a high forex reserve level, to deal with the various uncertainties caused by the threat of terrorism and the general election. "We should stick with the (original) plan," he was quoted by Antara as saying. "The House must not interfere in economic affairs by politicizing it, don't (campaign) for a narrow nationalism."

From http://www.thejakartapost.com/ 08/09/2003

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Belt-Tightening Measures, Subsidy Cuts Seal New Budget

President Megawati Soekarnoputri unveiled on Friday the 2004 state budget draft, which would cut the amount of costly subsidies on fuel and electricity and limit development spending as part of belt-tightening measures to bring government finances back in order. Total expenditures are projected at Rp 368.79 trillion (US$44.43 billion), slightly lower than the current budget of Rp 370.59 trillion. Revenue is set to increase by 2.3 percent to Rp 343.88 trillion. Under the draft, next year's budget deficit would shrink to 1.2 percent of gross domestic product (GDP) from the 1.8 percent estimated for this year. Over the past two years, the government has been forced to implement belt-tightening measures, at the request of the International Monetary Fund, to establish fiscal stability following the late 1990s financial crisis. The budget deficit was about 3.7 percent of GDP three years ago. This is important to show investors the government can prudently manage its finances, particularly as it seeks loans from foreign creditors and tries to raise funds on the international bond market to help finance the 2004 budget. It will be doing all this at a time when the IMF will no longer take an active role in designing the country's economic policies. "The ending of the IMF program represents a test and a challenge for us to show our credibility in implementing economic programs," Megawati told lawmakers when delivering her budget speech. Under the proposed budget, which will be debated by lawmakers next month, the amount of subsidies will be reduced to Rp 23.31 trillion from Rp 25.46 trillion. Subsidies on fuel products will be cut to Rp 12.69 trillion from Rp 13.2 trillion, while the electricity subsidy will be reduced to Rp 3.44 trillion from Rp 4.52 trillion. Other subsidies such as those for fertilizer and credits for farmers would also be affected. Development spending will be limited to Rp 68.10 trillion, compared to Rp 65.13 trillion under the current budget. Some sectors like agriculture, cooperatives, tourism and regional development could suffer from the lower spending next year. Of the total expenditures next year, Rp 68.5 trillion will go to paying interest on government bonds issued in the wake of the financial crisis. Despite the huge amount, this is 16 percent less than the amount allocated for this year. The government will have to work hard to raise funds at home and overseas to finance the fiscal gap next year. A large part of this will come from domestic bond sales of about Rp 28 trillion, and loans from the Consultative Group on Indonesia of about Rp 26.5 trillion. The government also plans to raise about $400 million through an international bond issue. Under the draft budget, the government hopes to raise Rp 10 trillion from the privatization of state-owned companies and the sale of remaining assets under the Indonesian Bank Restructuring Agency. The government also hopes to increase tax revenue by 6.6 percent to Rp 271 trillion. This will largely come from income tax and value added tax.

From http://www.thejakartapost.com/ 08/16/2003

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Balance of Payment to Go into Negative After Exit From IMF

After staying positive for years, Indonesia's balance of payment will stray into negative territory next year, partly because of higher public money outflows as a result of Indonesia's decision to exit the International Monetary Fund (IMF) program. According to the government's supplementary report for the 2004 budget, the country's balance of payment -- the difference between the amount of money going out and into a country -- is projected to slump to minus US$1.16 billion next year, from positive $2.46 billion this year and a staggering $5.76 billion in 2002. This negative balance of payment will eventually eat up the country's foreign exchange (forex) reserves. Consequently, forex reserves are expected to drop to $33.5 billion next year, from $35.58 billion this year and $32 billion in 2002. The worsening situation in the balance of payment has ensued mostly from the deficit in both public and private capital flows, as well as from the decline in the country's current account. Public capital flows are projected to reach minus $1.87 billion next year, from positive $277 million this year and minus $208 in 2002. Next year, foreign loans to the government is expected to reach $3.47 billion, up from $2.5 billion this year. However, the new loans would not help the government's budget much, as the government is required to pay out $5.35 billion to foreign lenders next year, a jump from $2.25 billion this year. This increasing payment from the government to foreign lenders will result from the loss of the Paris Club's rescheduling facility, following the government's decision to end the IMF program at the end of this year. This year, Indonesia has received a debt rescheduling facility from the Paris Club totaling $3 billion. Meanwhile, private capital flows are also expected to worsen next year to minus $3.46 billion from minus $2.9 billion this year and minus $1.48 billion last year. Private capital flows include foreign direct investment (FDI), which is expected to remain negative next year, portfolio investment and others, including loans from foreign lenders to local private entities and corporate debt payment to foreign lenders. FDI flows are also likely to get worse next year, projected at minus $3.69 billion -- which means that more investment money would flow out of the country, including from dividend payments -- from minus $2.9 billion this year and minus $785 million in 2002. The projection parallels the prediction by private analysts, who see no meaningful foreign investment in 2004, due to a heightening political climate as a result of the general elections. Meanwhile, portfolio investment flows are expected to remain positive next year at $1.48 billion, from $1.43 billion this year and $1.22 billion last year. Portfolio investment into the country will continue to center on government bonds, treasury bills and Bank Indonesia promissory notes, which offer better returns compared to other debt instruments in other countries. Also contributing to the worsening balance of payment is the decreasing current account -- the difference between the amount of money resulting from the country's international trade in goods and its trade in services. The current account will still record a surplus next year, but is expected to be much lower at $4.18 billion, down from $5.1 billion this year and $7.45 billion last year. The decrease in the current account surplus is a result of the decreasing trade surplus at $20.70 billion next year, from $21.98 billion this year and $23.12 billion last year. The expected slump in exports next year will be responsible for a decrease in trade surplus. Total exports next year are expected to slide to $61.07 billion from $61.39 billion this year, while imports are projected to increase slightly to $40.34 billion from $39.4 billion. Meanwhile, deficit in trade in services would be slightly lower next year at $16.55 billion, from $16.88 billion this year and $15.67 billion last year. (by Riyadi Suparno)

From http://www.thejakartapost.com/ 08/19/2003

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PHILIPPINES: Domestic Banks Step Up Efforts to Reduce Bad Loans Portfolio

Private banks are stepping up efforts to reduce their portfolio of non-performing assets and are now engaged in talks with foreign investment banks to dispose foreclosed and bad loans through the establishment of asset management companies or special purpose vehicle units. At least nine foreign investment banks have expressed intentions to acquire banks' NPAs and NPLs or are scouting to siphon off bad loans. These are Deutsche Bank, Goldman Sachs, Salomon Smith Barney, Lehman Brothers, JP Morgan Chase, Cerberus Capital Ltd., Colony Capital, Credit Suisse and Lone Star. The banking industry is burdened with R700 billion worth of NPAs and the bulk of which are in the form of NPLs. These refer to accounts whose principal or interest is unpaid for 90 days or more after the due date. A loan is considered past due if it is unpaid after a month. The Bangko Sentral ng Pilipinas expects at least half of the amount or R300 billion worth of bad loans and foreclosed assets will be disposed of in the next two years as banks and investment firms tie up. The SPV law says that NPAs consisting of bad loans or foreclosed assets will be sold at a substantial discount. According to BSP Governor Rafael Buenaventura, banks are targeting to unload about 50 to 70 percent of idle assets and bad loans through an SPV. "Several banks are in active negotiations with investors right now. We expect more AMCs to be established this year," he said. "Basically all the implementing rules and regulations are spelled out and its up to the investors and sellers to discuss it their details," Buenaventura said in an interview. "It will be up to them now to settle the price (for the assets)." He said the BSP recently structured loans in SPVs as subordinated debts. Proceeds from the sale of distressed assets would inject liquidity in the debt-saddled banking sector and could be used for renewed lending operations. At the moment NPL ratio averages between 26-27 percent. Last year it was 20-21 percent. Bankers said despite the lower interest rates this year, borrowers still have a hard time paying up interests on their loans. Philippine National Bank recently acquired the services of CB Richard Ellis Philippines, Inc. as consultant to help the bank bid out its idle assets worth R30 billion. In total the bank has over R75 billion worth of idle assets. Its NPL is R45 billion. Among the US investment banks to bid for the properties are Lehman Brothers, Salomon Smith Barney and Goldman Sachs. Lehman Brothers is also considering buying the idle assets Bank of the Philippine Islands. Other interested investors in the BPI idle assets are Asian Development Bank and the International Finance Corp. The central bank was hoping that the bad loans would stabilize at current levels or even slow down to a more manageable amount this year. An AMC unit or SPV buys NPLs and foreclosed assets of a bank at a discount by issuing cash or subordinated notes, which they will later sell to interested investors. The government is encouraging banks, to unload these NPAs so more funds could be freed up for lending and boost economic activity. (by Lee C. Chipongian )

From http://www.mb.com.ph/ 08/02/2003

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BSP Eases Lending Among Banks Using Foreign Securities

The Monetary Board, the policymaking body of the Bangko Sentral ng Pilipinas (BSP), has decided to relax lending among banks by allowing short-term lending with recourse of foreign-denominated securities through their foreign currency deposit units (FCDUs). According to BSP Deputy Governor for bank supervision and examination sector Alberto V. Reyes, the monetary authorities' decision is geared towards enhancing the development of the domestic capital market. Covered by the new ruling are banks with expanded commercial license otherwise known as EKBs. Under the arrangement, these financial institutions could lend their holdings of foreign-denominated securities, usually US treasuries, to an offshore institution including a foreign bank. "Foreign-denominated securities lending is initially confined to EKBs with complex derivatives license issued by the BSP," Reyes explained. The borrowings under this scheme must be fully secured either by cash and/or qualified instruments such as government securities, the value of which should be 102 percent of the market value. This means that EKBs with long positions can lend some of their holdings to other banks with short position "to cover liquidity requirement." The tenor is short-term, as in overnight, two-day or a month-term basis. Reyes said the monetary authorities agreed to open up this lending avenue among banks in answer to requests of foreign banks that would like additional sources of income to offset rising operating costs. BSP Assistant Governor Nestor Espenilla, on the other hand, likened this lending arrangement to local securities swap transactions as the local version of the international securities lending. "In the FCDU version, the securities are usually US treasuries and the transactions are done through international brokers. The local FCDU would earn by imposing an interest similar to any loan," he said. Espenilla explained that under this lending scheme, there is a temporary exchange of securities usually for other securities or even cash of an equivalent value. A contractual obligation to deliver the same securities or its equivalent, at pre-agreed future date must accompany the exchange, Espenilla said. Reyes, meanwhile, said the newly approved lending arrangement will later be allowed among local banks and investment houses. But it will be dependent on how soon the government can establish the mechanism for Cash Settled Securities Swap Transactions (CSSST). While he echoed the view of the monetary authorities that such policy decision is expected to boost the capital market, Espenilla, though, opined that opening the arrangement up to local securities should be effected only after the proposed rationalization on financial transaction tax has been passed into law. Espenilla cited the documentary stamp tax on secondary transactions as a deterrent. This is on top of the request of banks for the Bureau of Internal Revenue to exempt the CSSST from the 20 percent withholding tax. (by Fil C. Sionil)

From http://www.mb.com.ph/ 08/03/2003

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THAILAND: Thailand Far From Debt-free

Assembly of the Poor adviser Somkiat Pongpaiboon says the prime minister should think twice before celebrating Thailand's independence from debt. Family debts were increasing, which could lead to another economic crisis, he said. Prime Minister Thaksin Shinawatra said yesterday Thailand had repaid its IMF debts of US$12.29 billion two years ahead of the deadline in 2005. Mr Somkiat said the early repayment of the debt was indeed an achievement and he backed the government's enthusiasm for declaring Thai economic sovereignty. However, freedom from IMF debts was just the ``shell'', not core, of economic independence and the government needed to take another four steps to secure genuine freedom. The government should revoke all 11 laws passed under IMF terms and stop the privatisation of state enterprises, he said. Development strategies were needed to ensure the country's self-sufficiency and freedom from unfair agricultural deals under the World Trade Organisation. Mr Somkiat said the government should also slash debts in the people's sector. The size of debts in this sector had increased to 83,314 baht a family last year from 68,279 baht in 2001. He warned that this could lead to another slump.

From http://search.bangkokpost.co.th/ 08/02/2003

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VIET NAM: Govt Can't Guarantee All Bank Loans

Prime ministerial permission for a project does not mean the Government will automatically act as guarantor for bank loans, Prime Minister Phan Van Khai has clarified in a new decision. The decision, signed by Khai last Tuesday, states the Government will not guarantee loans in Vietnamese dong nor a foreign currency, the latter becoming increasingly preferred as US dollar interest rates dip. The Government will still allow commercial banks to lend more than 15 per cent of their equity capital to a prime minister approved project. Projects worth more than VND200 billion (US$12.9 million) need to have permission from the Prime Minister. Deputy director of the central bank's credit department, Nguyen Viet Dzung, said banks should not assume prime ministerial permission is a guarantee. "The Government allows the banks to lend more, but takes no responsibility for whether they decide to lend or how much." The new decision reiterates recent banking policy which gives banks greater autonomy, but requires them to take greater responsibility in lending decisions, Dzung said. He said banks need to improve their ability to appraise loans if they want to exercise power and minimise risks. The decision also comes after the central bank governor warned banks last month not to pour too much capital into giant projects, which were not always good credit risks. Under the decision, the Ministry of Finance will act as guarantor for projects prioritised by the Government, such as paper, fertiliser and steel ingot production. The decision, which does not affect projects already guaranteed by the finance ministry, will take effect 15 days from being published in the Cong Bao (Official Gazette).

From http://vietnamnews.vnagency.com.vn/ 08/08/2003

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PM Approves Stock Market Strategy

Prime Minister Phan Van Khai has given his approval to a development strategy for Viet Nam's stock market to the year 2010, which aims at increasing the market capitalisation to 15 per cent of the country's GDP. The PM, in his recently issued decision 163/2003, said the strategy is to develop the stock market in both scale and operational quality. The goal is to create a channel for mobilising medium- and long-term capital for development investment and to boost the financial market. Supervision of the stock market must protect investors' legitimate rights and interests, he said, adding that the market's competitiveness must be enhanced to integrate into the world's financial markets. The appoved strategy, which was worked out by the State Securities Commission (SSC), highlights principles for the development of the stock market. Development should be in accordance with the country's realities and socio-economic development, and with international customs and standards, said the SSC. The State would carry out its management function of the stock market through laws that facilitate operation and development of the stock market and ensure the rights and interests of all market players. The development of the stock market will be linked with that of the capital, monetary and insurance markets, the SSC said. The stock market is expected to represent two to three per cent of the country's GDP by 2005 and 10 to 15 per cent by 2010. Accordingly, development of the bond market, especially the Government bonds, will be a focus to mobilise capital for the State budget and for investment development projects. The HCM City Securities Trading Centre will be upgraded into a stock exchange which has automated tradiing, supervising and information disclosing systems. A market for shares of small- and medium-sized enterprises will be established in Ha Noi, which will be turned into an over-the-counter market (OTC) after 2010. An independent custodian centre will be set up to provide securities registering, custody and payment services to serve securities trading in securities exchanges and securities trading centres. As for the development of intermediate financial institutions, the strategy encourages organisations from all economic sectors that can satisfy required conditions to set up securities companies, while stimulating existing securities companies to expand their operations to all cities and provinces. The strategy also stresses the opening of management companies for securities investment funds. Establishment of trust evaluating companies is planned for assessing and classifying risks of listed securities, and assessing trust of enterprises. Under the strategy, institutional investors, including commercial banks, securities companies, financial firms, insurers and investment funds, will be helped for participating in the stock market as professional investors and market markers. Meanwhile, individual investors will have more opportunities by contributing capital to investment funds. On solutions for implementing the strategy, Prime Minister Phan Van Khai wants a complete legal framework for the stock market with a securities law draft to be submitted to the National Assembly for approval in 2005. The equitisation of State-owned enterprises will be linked to the selling of their shares to the public and listing the shares in the stock market. The decision of the PM signals opportunities for commercial banks and big firms to issue new shares and have them listed on the stock market. The PM said tax incentives to investors must be made as well as higher rates for foreign investors to own shares of listed firms. Listed firms, securities companies, and management companies for investment funds will be forced, under the new strategy, to carry out regulations on corporate management in accordance with international customs and on information disclosure as required by law. PM Khai also instructed SSC to take responsibility in organising the implementation of his decision in co-ordination with related ministries, people's committees of cities and provinces, and the Government Office.

From http://vietnamnews.vnagency.com.vn/ 08/12/2003

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State Bank, World Bank Sign $100m Worth Credit

The State Bank of Viet Nam signed a US$100 million credit with the World Bank last Friday to help the country continue on its path of poverty reduction and sustained economic growth. A further $33.7 million in grants were provided by Britain, the Netherlands and Sweden in support of the credit, known as the second Poverty Reduction Support Credit (PRSC2). "The PRSC2 greatly contributes to the Government's efforts in the socio-economic development of the country, especially the poverty reduction targets, through accelerating reforms and structural adjustment in various areas," State Bank Governor Le Duc Thuy, said. The state bank said the PRSC2 would help Viet Nam continue with its banking and trade reforms, its restructuring of state-owned enterprises and deregulation of the private sector. It would also focus on other sectors, including education, legal reforms and public finance, the State bank said. "Signing the PRSC2 is another endorsement by the international community for Viet Nam's economic and social development progress," Klaus Rohland, the World Bank's Viet Nam country director said. Rohland said the credit would also improve access by the poor to education and health care, and encourage more secure asset ownership in the form of land titles. The programme of reforms to be funded by the PRSC2 is also intended to help Viet Nam implement its own poverty reduction and growth strategy, particularly in helping the country complete its transition to a market economy. The two banks also signed a $5.5 million grant from the Global Environment Facility to promote more efficient use of electricity and a reduction in peak loads. A major part of the grant will be used to install time-of-use meters on the premises of heavy-use and medium-use customers to encourage them to voluntarily ration their use of electricity during peak periods. The plan is to achieve a reduction of more than 120 MW in peak electricity demand over three years. The project also aims to save about 500 GWh through the sale of about 1 million compact lamps to households located in areas of high loads and network congestion, and the promotion of more efficient fluorescent tube lamps. "Although Viet Nam is a resource-rich country, we should strive to develop the energy sector along an environmentally sustainable path," according to Minister of Industry, Hoang Trung Hai.

From http://vietnamnews.vnagency.com.vn/ 08/16/2003

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BANGLADESH: T-Bills Fall Due to Low Money Rates

Commercial banks and financial institutions showed more interest to place their surplus funds in government's treasury bills as following lower demand for short-term money, fund managers said. More than 15 commercial banks today submitted competitive bids offering Tk 1537.60 crore for various government treasury bills which have become more lucrative investment for some banks due to their huge surplus funds, fund managers said. "Most banks are holding surplus funds when the demand for call money has come down remarkably. So it is better to place our funds in government's treasury bills which are eligible in SLR", fund manager of a leading commercial bank said. The government, however, sold treasury bills worth only Tk 1096.70 crore through a regular auction today to cut the yield of short-dated treasury bills, fund managers said. Of the total, banks and financial institutions purchased 28-day T-bills worth Tk 1071.10 crore as the sentiment on money remain bearish in the money market due to surplus liquidity flow. The implicit yields of short-dated 28- day treasury bills (T- bills) fell to 4.59-6.80 per cent today from last week's rates 6.60-6.85 per cent, according to a statement issued by the Bangladesh Bank. The yield of medium-term 364-day T-bills fell to 9.59-9.70 per cent today from last week's 9.60-9.75 per cent and the yield of 5-year bills stood at 10.20 per cent, the statement said.

From http://independent-bangladesh.com/ 08/11/2003

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INDIA: Tax Collection Plan Delayed Yet Again

CHANDIGARH: Realisation of property tax from nearly 17,000 commercial units in the city has been delayed yet again by another month. Collection of five per cent tax by the civic body, which was initially scheduled to have started from August 1, is being expected to take off only in October. While the ruling Congress party is insisting that an attempt is being made to make property tax `people friendly', MC's officialdom is terming it as just another `politically motivated' decision. The Municipal Corporation is yet to take up the matter with the UT Administration for `reconsidering its decision to implement five per cent property tax when the MC House had approved only two per cent.' A senior MC official said, "We are still waiting for the minutes of the MC House meeting which are required to write to the UT Administration to reconsider its decision." Even as elected representatives are hoping that the UT Administration will reduce five per cent property tax implemented to two per cent, MC officials are skeptical. A senior official said, "The elected representatives are more concerned with making politically motivated moves rather than thinking in the city's interest. Hopefully, the UT Administration will strike down the request once again and we will be allowed to initiate collection proceedings." The babudom is all set to start the tax realisation process. Information about the calculation of tax, zoning of the city and collection has been made available online on MC website which is scheduled to be launched shortly. While involvement of banks is being sought to collect revenue the civic body is also planning to open a counter in MC office for tax collection.

From http://timesofindia.indiatimes.com/ 08/19/2003

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RBI Intervention Halts Rupee Slide

MUMBAI: Nervousness gripped the interbank foreign exchange market today and sent the rupee tumbling down following report of a series of bomb blasts that hit the city, but timely intervention by the Central bank partly arrested the slide. As the news of the explosions came in, the rupee already reeling under month-end pressures, plunged to the 46-dollar level, before concerted intervention by the Reserve Bank of India (RBI) and other state-run banks, helped it to recover partly to Rs. 45.90/92 per dollar at close, dealers said. Despite dollar-buying intervention by the RBI and other public sector banks, the rupee still finished around eight paise down from last Friday's close of Rs. 45.83/8350. The rupee opened distinctly weak at Rs. 45.8450/86 per dollar and dipped to 45.87/88 in late morning deals, pulled down by the usual month-end dollar demand. "The usual month-end pressures having taken a toll of the rupee, news of the bomb blast sent panic operators scrambling to cover short-dollar positions, resulting in the rupee losing over ten paise within an hour. But, determined intervention by the apex bank, helped stabilise trade and saved the day for the rupee," a dealer commented. The rupee, was now stabilising from the temporary knee-jerk reaction and was allowing market forces of demand and supply to govern its direction, bankers said. The Reserve Bank of India maintained the reference rate for the U.S. currency at Rs. 45.86 per dollar.

From http://www.hindu.com/ 08/26/2003

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SRI LANKA: Central Bank Lowers Policy Interest Rates

The Central Bank of Sri Lanka(CBSL) yesterday announced a reduction in policy interest rates for the third time this year and said further reductions could be expected if the present trend in the economy continues. The Central Bank's Reverse Repurchase rate was reduced from 8.25% to 9.5% per annum, while the Repurchase (Repo) was reduced from 8.25% to 7.5% per annum, from yesterday. Deputy Governor W. A. Wijewardena told the media in Colombo yesterday that the Repurchase (Repo) and Reverse Repurchase (Reverse Repo) rates were reduced by 75 basis points. The Bank Rate has also been revised downward from 18% to 15% in line with the reduction in policy rates with effect from yesterday. The Bank rate has not been revised since December 2001 though all other interest rates have declined continuously. Wijewardena said that the recent economic developments have warranted a review in these rates adding that the reduction will not have any inflationary impact and will not lead to any reduction in all lending rates adequately and immediately. The reduction in policy interest rates is expected to reduce cost of interest encouraging investments and will also reduce spread market rates. Consequently high investment will lead to higher growth and more employment benefiting customers, investors and producers, Wijewardena said. According to available indicators, inflation and inflation expectations have been declining and the inflation rate, which is 8% at present is expected to fall further to 6.5% to 7% by the end of the year. Monetary expansion up to end June has been within the target set at the beginning of the year and there has been continous excess liquidity in the market. The containment of public sector borrowing, despite a possible shortfall in government revenue, has reduced pressure on domestic market interest rates, causing them to decline. There has been continued stability in the foreign exchange market and several international interest rates have also been reduced. Wijewardena said that as this reduction in policy rates is intended to further strengthen the recovery in economic activity the CBSL expects a strong response from all financial institutions through an adequate and immediate reduction in their lending rates. Private sector growth is still below expectation and for the economy to boost private sector credit expansion is vital, he said. The economic growth of the country during the first quarter of the year was 5.5% and the annual expected growth by the end of the year is 5.5%. There has been a growth in all major sectors including agriculture, industry and services. Tourism, port activities and stock market indicators have made a significant growth during the first quarter. (by Chamitha Kuruppu)

From http://www.dailynews.lk/ 08/16/2003

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PAKISTAN: Export Finance Rate Cut to 3pc

KARACHI: Exporters will get export finance from banks at three per cent in August as the State Bank has cut refinance rate by half a percentage point to 1.5 per cent. The State Bank announced on Wednesday that it would give banks export refinance at 1.5 per cent in August, adding that the banks would be free to add a 1.5-per cent spread over it while pricing export finances. Thus the eligible exporters would be getting export loans from banks at three per cent in August. Till July they got export loans at 3.5 per cent as the SBP refinance rate stood at two per cent. Bankers say what has enabled the central bank to make a half percentage point cut in its export refinance rate was a crucial 32 basis points cut in the cut-off of six-month treasury bills yield in the last auction held this month. The yield on the T- bills serves as a benchmark for the export refinance rate under a formula forwarded by the IMF and accepted by the SBP as part of its strategy to eliminate interest rate subsidy from the exports. The SBP announcement said the financing facility under part B of the export finance scheme for financing locally manufactured machinery shall also attract similar mark-up structure meaning that three per cent interest would be charged on it in August. Export finance rate has fallen from eight per cent in August 2002 to three per cent applicable in August 2003 primarily because the SBP has been following an expansionary monetary policy as a result of which overall interest rates have been on the decline.

From http://www.dawn.com/ 07/30/2003

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State Bank Issues Guidelines-Risk Management

KARACHI: The State Bank on Friday issued flexible risk management guidelines that require banks and development finance institutions to devise an action plan for dealing with problem loans and also start assigning internal credit ratings to individual credit exposures. These guidelines also require banks and DFIs to have a separate office in their treasuries to manage the risks relating to the treasury operations and report the same directly to senior management. In addition, banks and DFIs have been asked to set up an effective organizational structure to continuously monitor the liquidity level. The guidelines issued to the banks and DFIs through a circular (BSD 07) call upon them to devise a mechanism to identify, measure and mitigate or control liquidity risk. Liquidity risk is the possibility of loss due to the banks' inability to fund their commitments without incurring unacceptable costs. The guidelines, laid down by the central bank, also require banks and DFIs to put in place a system for containing operational risk i.e. the risk of loss due to inadequate or failed internal system or procedure. Senior bankers say the risk management guidelines will help banks and DFIs in mitigating the possibility of loss in any form and will thus prepare them to meet the challenges of banking in the new global environment. "The introduction of these guidelines are well-timed," said head of a private bank, adding that banks and DFIs are becoming more vulnerable to market risks as central banks the world over are reshaping their monetary policies to keep economies alive. Pakistan has also been following a loose monetary policy to revive an economy mired in a slump. This, coupled with a dramatically high inflow of foreign exchange, has exposed the banking system to a greater interest rate risk in the short term and to foreign exchange rate risks in the medium term. Bankers say with the easing of trade restrictions and lifting of textile quotas from January 2005 the market risk relating to commodity prices would also become more pronounced. Similarly, banks are also exposed to the risk relating to equity prices as the crackdown launched against unscrupulous bank accounts the world over is attracting more investment in stocks-but at the same time adding to the complexities and uncertainties of this business. The risk management guidelines that the banks and DFIs are supposed to implement - an introduction of the New Basel Capital Accord in Pakistan - are in addition to the Prudential Regulations. Once the accord is introduced in Pakistan the risk management guidelines "will converge with the requirement of the accord and will become enforceable regulation," says the SBP circular. It advises the banks and DFIs to communicate to SBP in the form of a half-yearly progress report the measures taken by them for the implementation of the guidelines. Banks and DFIs should submit this report to Banking Supervision Department of SBP within 30 days from the end of each calender half year i.e. 30th June and 31st December. The first such report shall be submitted to SBP for the half year ending 31st December 2003. The SBP's inspection team shall conduct on-site verification of the progress so reported during their routine inspection." The guidelines are as follows: 1. CREDIT RISK: Historically credit risk has been the risk causing major losses to banks operating in Pakistan. The board of directors is responsible for formulating a well-defined credit policy. The senior management needs to develop policies, systems and procedures and establish an organizational structure to measure, monitor and control credit risk which should also be duly approved by the board. The bank should also put in place a well-designed credit risk management setup commensurate with the size and complexity of their credit portfolio. The banks are also encouraged to assign internal credit ratings to individual credit exposures. The architecture of such a rating system may vary among banks. The loan portfolio should be monitored regularly and a report prepared at periodic intervals both for the aggregate as well as sectoral and individual loan level. Finally, the banks are required to formulate a strategy or action plan to deal with problem loans. 2. MARKET RISK: The banks should establish a mid office between front office and back office functions. This unit should manage risks relating to treasury operations and report directly to senior management. They may adopt various techniques to measure market risk as they deem fit. They should also ensure that they have adequate control mechanisms and appropriate setup such as periodic risk reviews/audits etc to monitor market risk. 3. LIQUIDITY RISK: As the impact of the liquidity risk could be catastrophic the senior management needs to establish a mechanism to identify, measure and mitigate or control the same. The senior management should also establish an effective organizational structure to continuously monitor the bank's liquidity. Generally, the bank's board constitutes a committee of senior management known as ALCO (Asset Liabilities Committee) to undertake this function. Key elements of sound liquidity management process include an effective MIS, risk limits and contingency funding plan. 4. OPERATIONAL RISK: Operational risk is the risk of loss due to inadequate or failed internal processes, procedures, systems and controls or from external events. Besides establishing a tolerance level for operational risk, the board of directors needs to ensure that the senior management has put in place adequate systems, procedures and controls for all significant areas of operations. Moreover, the management of the bank should effectively communicate the laid-down procedures, guidelines down the line and put in place a reasonable setup to implement the same. (by Mohiuddin Aazim)

From http://www.dawn.com/ 08/16/2003

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IRAN: Central Bank Issues Participation Bond

TEHRAN (Mehr News Agency) - The Central Bank of Iran announced the launch of its first ever participation bond here today. The decision to issue the bond is in line with this year's monetary policies and Article 91 of the country's Third Economic, Social, and Cultural Development Program, the statement said.It would be issued in two, five, ten, and twenty million-rial denominations. The banking network comprising state-owned and private banks would offer the bond for sale at their branches throughout the country on August 14 - 21.Maturity is one year from the date of issue with a minimum yield of 17% guaranteeing initial investment. The return would be paid every three months with the amount of interest calculated on a daily basis. CBI guarantees the redemption and payment of the yield on the maturity date by the acting bank. The bond can also be sold to the acting bank before maturity. (by Majid Roshanfekr)

From http://www.tehrantimes.com/ 08/05/2003

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KYRGYZSTAN: Kyrgyzstan Gives Go-Ahead to Leasing

BISHKEK (TCA). Last week Deputy Chairperson of the Kyrgyz National Bank, Kanysh Sharshekeyeva, President of the Kyrgyz Investment and Credit Bank, Kwang Young Choi, director of the International Finance Corporation's project on developing leasing in Central Asia, Rachel Freeman, specialists of the Kyrgyz Finance Ministry, and local small and medium business representatives met at Bishkek's Hyatt Regency Hotel to discuss leasing development in Kyrgyzstan. On 14 June 2003 Kyrgyzstan passed a law amending the Tax Code, creating the necessary prerequisites for financial leasing. Two years ago the International Finance Corporation (a subdivision of the World Bank Group) and the Swiss Secretariat for Economic Relations launched a project to develop leasing in Central Asia, particularly in Kyrgyzstan, Uzbekistan, and Tajikistan. Last year the Kyrgyz parliament passed the law "On financial leasing" prepared by the National Bank with the participation of the above project. But the law has proved insufficient for introducing this new financial instrument into Kyrgyzstan's banking sector. Rachel Freeman told TCA about the prospects of financial leasing in Kyrgyzstan after amending the country's Tax Code: The Kyrgyz Investment and Credit Bank has realized all advantages of financial leasing. It is the first commercial bank in Kyrgyzstan offering leasing services for local business companies. The recent amendments to the Tax Code have positively affected the leasing market: over two months one organization has made more than 100 leasing contracts. Although small in size, these contracts indicate the market's increasing activity. I am sure this trend will continue because leasing gives an impetus to small and medium business development. The experience of financial leasing in other countries (as South Korea, Turkey, and Russia) has showed that it greatly assists economic development of transition countries. Why is financial leasing so important for Kyrgyzstan? Small and medium business people face some difficulties while obtaining bank credits. In particular, they all lack collateral for loans. In addition, bankers study the balance and assets of potential borrowers. This problem exists not only in Kyrgyzstan but also in Kazakhstan, Russia, and Ukraine. In case of financial leasing, equipment itself is used as collateral. If a businessman gets equipment or technological lines through leasing, nobody would ask him about collateral that may amount to 20% of the loan. Second, banks often demand from borrowers their credit history, whereas leasing companies only fund fixed assets and want to know about the future return from leased equipment. They discuss with lessees the future, not the past. The third, leasing has some tax advantages. Moreover, the process of obtaining financial leasing is much simpler than the time-consuming procedure of getting a bank credit. In Uzbekistan, for instance, financing through leasing is by 75% faster than through bank credits. It is important that leasing companies know on what their money is used, since they buy equipment themselves. Financial leasing opens big opportunities for both equipment producers and dealers. If previously buying equipment required a 100% advance payment, today leasing companies (acting as intermediary) can extend the market for equipment. Soon consultation firms and dealers of Chinese, German, Swedish equipment would come to Kyrgyzstan. We are waiting for them to apply to the Kyrgyz Investment and Credit Bank for leasing services. The bank is ready to grant for leasing deals money varying between US $50,000 and US $1 million for up to seven years at 14%-16% per annum. (by Larisa Lee)

From http://www.times.kg/ 08/16/2003

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KAZAKHSTAN: Government Fund to Finance the Elimination of Disasters

Shalbai Kulmakhanov, Almaty oblast akim, applies for an allocation of 400 million KZT from the reserve fund of the government of RK, for the elimination of disasters that took place in Almaty oblast during June and July 2003, the press service of the government of RK reports. According to Almaty oblast akimat, the total financial damage caused by 7 mudflows and 5 landslides makes 1 billion 549 million KZT. 311 million 700 thousand KZT have been allocated to eliminate the consequences of natural catastrophes from the oblast akim reserve fund. 35.4 million KZT have been allocated from district budgets and 50 million KZT from managing subjects. As it was reported earlier, as a result of river floods and mudflow discharges that had taken place in Almaty oblast, 8 bridges, 11 bridge crossings and water passages, 16 km of roads had been destroyed. Hails destroyed sugar-beet on the area of 1.26 thousand hectares, 2.4 thousand hectares of soy, 9.7 thousand hectares of grain crops, 1.2 thousand hectares of potato, 1.2 thousand hectares of maize.

From http://www.gazeta.kz/ 08/11/2003

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TAJIKISTAN: World Bank to Provide Second Part of Credit for Tajikistan

World bank to provide second part of credit for economic reforms in Tajikistan. DUSHANBE, August 15, Asia-Plus - Tajik President Emomali Rahmonov yesterday received Mr. Cevdet Denizer, World Bank Country Manager in Tajikistan. As Asia-Plus was told at presidential press service in the course of that talks Rahmonov and Denizer discussed a progress of economic reforms carried out in the republic. In this connection, the sides focused attention on discussion of fulfillment of terms of a tranche and allocation of its second part within the credit program, according to presidential press service. We would recall that the first tranche of this credit in an amount of $25 million was provided in June 2001 already. Within the framework of fulfillment of terms of the second tranche some events are provided for, including drawing up and approval of a strategic plan of privatization of small and large enterprises, reduction of debt in municipal sphere and carrying out audit at the Aluminum Plant in Tursunzoda, presidential press service reports. During the meeting the sides also discussed results of meeting of donor countries on Tajikistan that was held in Dushanbe in May of the current year, as well as issues related to commitments announced at the meeting and making preparations for holding meeting of donor countries, according to presidential press service.

From http://www.asiaplus.tajnet.com/ 08/15/2003

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UZBEKISTAN: Top Banker Confirms Currency Convertibility on Track

The deputy chairman of the Uzbek central bank, Shukhrat Toshmurodov, has confirmed in a TV interview that the Uzbek government will ensure the convertibility of the national currency on current transactions by the end of 2003. In an interview with Uzbek TV's weekly "Tahlilnoma" news programme, Toshmurodov stated that multiple exchange rates have been unified as part of the requirements laid down by the IMF. "As of today, the exchange rates of the official and parallel markets have been unified. As for the lifting of restrictions, those which currently exist in our legislation are to be lifted soon," Toshmurodov suggested. Toshmurodov went on to say that as of today any organizations and corporate bodies "enjoy the right of converting currency in an unlimited quantity in their authorized banks according to their contracts [presumably with the banks]". Toshmurodov noted the need to introduce amendments to Uzbek laws in order to bring them in line with IMF regulations. "I think that over the remaining few months the government will make a decision on this," he said. Discussing limits imposed on the amount of foreign currency Uzbek citizens are allowed to buy in cash, Toshmurodov said that private individuals are allowed to exchange up to 2,000 dollars in cash. "As of 1 August private individuals may exchange this sum once every two months. Before this was once a quarter," he said. (by Justin Burke)

From http://www.eurasianet.org/ 08/04/2003

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AUSTRALIA: Companies Face Audit Blitz

EVERY listed Australian company will be audited by the corporate regulator in the next four years under a new regime to ensure compliance with accounting standards. As part of an Australian Securities and Investments Commission plan laid out yesterday, companies that do not value the options of their directors and top executives could face enforcement action. ASIC chief accountant Greg Pound said 440 publicly traded entities - roughly one-third of all listed companies - would be subject to the audit this year. All areas of publicly available accounts would be inspected. The announcement means ASIC has ended its specific pursuit of Enron and WorldCom-style company sorts, which was launched last year to test all listed companies against the three main accounting standards flouted during the corporate scandals of 2001 and 2002. Last year's program found no "systematic problems" at Australian companies but identified a number of transgressions, with about 15 companies forced to fix accounting problems in consultation with ASIC. However, it also found that almost 20 per cent of listed companies faced solvency problems, while 49 had qualified accounts. As part of that process, each company chairman received a letter from ASIC chief David Knott warning of the review. But Mr Pound said company directors this year would only know if their accounts were being checked by ASIC if they had done something wrong and were asked to explain. Companies under scrutiny would be chosen by random sample. But others would also be checked, particularly those given a qualified audit report for non-compliance with an accounting standard. The auditors themselves would also be part of the crackdown, with Mr Pound saying the surveillance program would result in an "increased focus on auditor compliance". "Where there is a potential problem with a company's financial report that has not been reported by the auditor, we believe that, prima facie, there is cause to review the quality of the audit," he said. Flagrant abuses would attract enforcement actions. Mr Pound said the review would cover compliance with all accounting standards, but ASIC would respond quickly if any new fashion in corporate skulduggery emerged. "Continuous monitoring will enable ASIC to anticipate potential problems. For example, an environment of prolonged pressure on company profits could lead to an ASIC focus on accounting policies for revenue recognition and capitalised and deferred expenses," Mr Pound said. Australian Shareholders Association executive officer Stuart Wilson said he welcomed the ASIC initiative. "A more comprehensive review of company accounts is probably a better approach because it will be more thorough and probably more testing of the companies," he said. Another area to come under scrutiny would be the value of options issued to directors and top executives. ASIC said in May it would enforce its new guidelines on the valuation of options in directors' reports. Mr Pound said action would be considered against companies or directors where the value of options had not been disclosed. By dealing with more areas of compliance in fewer companies, this year's would be a "more detailed and more comprehensive review" than last year's examination, he said. While more widespread, last year's effort focused on just three areas of potential concern: the capitalisation of expenses (WorldCom's deception); the failure to recognise controlled entities and assets (Enron's fraud); and the false representation of revenue. (by Michael Bachelard)

From http://www.theaustralian.news.com.au/ 08/05/2003

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Rate Cut Fades as Investment Surge Nears $7bn

The Reserve Bank said today the argument to cut interest rates had weakened over the last three months, as official figures confirmed the property investment boom showed no signs of slowing. Figures from the Australian Bureau of Statistics (ABS) showed loans for housing investment jumped 8.3 per cent to $6.88 billion in June, from $6.35 billion in May. The sharp increase in lending for housing investment comes on top of a jump last week in the number of home loans, pointing to continued strength in the real estate market. Demand from investors has been blamed for helping to push up house prices, pricing first time home buyers out of the market, and the government has ordered a Productivity Commission inquiry. The rise makes an interest rate cut even more unlikely when the Reserve Bank board meets again next month, and some economists are already expecting the next move in rates to be up. Australian interest rates have been frozen for 14 months despite cuts by most other central banks opening up an interest rate gap with the rest of the world, particularly the United States. The Reserve Bank of Australia said rates had remained on hold because the case to cut had weakened since June. However, in its August Statement on Monetary Policy, the central bank said rates could still be cut if consideration of the risks required it. It also said the inflation outlook, on its own, did not make a case for lower rates. "The board took the view at its June meeting that the economy had entered a period where the monetary policy decision would be whether to hold interest rates unchanged or to reduce them," the RBA said. "Within the context of this broad strategic assessment, the board judged at the time of the June meeting that the case for an easing was not sufficiently strong and, in the event, subsequent developments tended to weaken that case further, so that the cash rate was again held unchanged at the July and August meetings." Borrowings on credit cards, personal loans and overdrafts jumped to $6.10 billion in June, up from $5.91 billion in May. Home lending to owner occupiers rose 5.1 per cent to $10.27 billion, seasonally adjusted, while total commercial lending fell 2.2 per cent to $20.96 billion. The volatile lease category plunged 23.8 per cent in the month, the ABS said.

From http://www.smh.com.au/ 08/11/2003

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Pacific-Wide Currency 'Unlikely'

A Pacific-wide currency is not viable, Australia's Prime Minister John Howard says. "I think we should crawl before we walk," Mr Howard said after arriving in Auckland for the Pacific Islands leaders' forum. An Australian parliamentary committee's call for Pacific countries to adopt the Australian dollar has been criticised as "interventionist" by former Fiji cabinet minister Tupeni Baba. Prime Minister Helen Clark responded cautiously yesterday, saying such a move was unlikely in the short or medium term, "but I don't think we should say such ideas are completely out of the agenda". Cook Islands Prime Minister Robert Woonton, also attending the forum, said some Pacific Island leaders had expressed concern about a common currency. "The question of sovereignty is one that we will have to address if Australia intends to bring in ... one currency." The call for a common currency coincides with a push by Australia to expand its leadership role in the Pacific, a move endorsed this week by a senior United States official. US Deputy Secretary of State Richard Armitage told a business audience in Sydney that Australia was a global power and "unapologetic" about its leadership in the region, including its intervention in the Solomon Islands. But smaller island states are wary of Australia's ambitions, including Mr Howard's plan for a regional police college and his threat to cut aid unless they deal with corruption. Former diplomat Terence O'Brien said Australia had made a long-term strategic commitment to the US and a result of that was a view of its role in the Pacific as a "sort of deputy to America", in places the US could not spare the time or attention. The Australian senate committee proposed a Pacific community with one currency, a single labour market, common laws, budgetary and fiscal disciplines, shared defence and security arrangements, and common goals in health, welfare, education and the environment. Its recommendation was in response to a worsening economic and social environment in the region, to Australia's responsibility to smaller countries and the cost to Australia of decline among its Pacific neighbours.

From http://www.stuff.co.nz/ 08/15/2003

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NEW ZEALAND: Government to Examine Taxation Loophole

Finance Minister Michael Cullen yesterday signalled that the Government would move to prevent New Zealand investors from using certain investment vehicles to escape tax. In a speech delivered on his behalf by Associate Revenue Minister David Cunliffe to the Institute of Chartered Accountants, Cullen referred to a New Zealand resident investing in New Zealand Government stock through an Australian unit trust and possibly not paying tax. An identical investment through a New Zealand vehicle would be clearly subject to New Zealand tax. From the Government's perspective this was unacceptable and, if necessary, the loophole would be closed. As a first step, an issues paper would be released in October for consultation on proposals to deal with this and other problems that arose under the foreign investment fund rules. "As I understand it, the arrangement works something like this," Cullen said. "A New Zealand resident purchases units in an Australian unit trust, and the unit trust uses those funds to buy, for example, New Zealand Government bonds. Interest from the bonds is paid to the Australian unit trust, with only a 2 per cent levy deducted. "Because Australia, unlike New Zealand, taxes the entity as a trust rather than as a company, the interest is not taxed in Australia because it is not sourced in Australia and does not relate to an Australian beneficiary." The unit trust distributed its income by way of non-taxable bonus issues so that the New Zealand investor ended up with more units. Because of the way New Zealand and Australian tax law inter-related, no New Zealand or Australian tax was payable at this stage either. "Gains that New Zealand residents derive from the eventual sale of their units may, however, be taxable, depending on whether the investment was held on capital or revenue account. "But regardless of the intricacies of the capital versus revenue law, the main point is that New Zealanders may be able to derive interest from New Zealand Government bonds virtually tax-free if they invest through one of these Australian unit trust structures." That was unacceptable.

From http://www.nzherald.co.nz/ 08/07/2003

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Retail Sales Surprise Economists

The economy has surprised again, with unexpectedly strong retail sales further decreasing pressure on the Reserve Bank to cut interest rates in September. Seasonally and inflation-adjusted June quarter retail sales grew 1.5 per cent, figures released by Statistics New Zealand today showed - well ahead of economists' expectations of 0.2 per cent. Actual overall sales for the June quarter were $12.58 billion, 4.6 per cent higher than $12.03 billion in the same quarter last month but slightly down on $12.68 billion in the March quarter. On a monthly basis, seasonally adjusted retail sales for June rose by 0.5 per cent against economists' expectations of 0.4 per cent. However Westpac chief economist Brendan O'Donovan noted that, while sales at constant prices rose 1.5 per cent, seasonally adjusted total retail sales rose only 0.3 per cent in the quarter, suggesting average price levels fell 1.2 per cent. "The recent appreciation of the New Zealand dollar is obviously starting to filter through to the consumer with many stores with a high import component recording price falls," he said. Today's data comes hard on the heels of better than forecast jobs growth and unemployment figures published on Friday, and last month's June quarter Consumers Price Index data which showed annual inflation running at 1.5 per cent. Most economists anticipated a fourth 25 basis point interest rate cut on September 4 to provide some relief to sectors struggling with the strong New Zealand dollar and a "soft spot" in the economy, caused by one-off events like the recent drought, severe acute respiratory syndrome and uncertainties over electricity supply. However the effects of those events were dissipating faster than expected, Finance Minister Michael Cullen said last week. "As events have unfolded, these negative pressures have eased," he said. "While it (growth) may be slowing, the softness is caused by temporary rather than structural impacts, so the outlook is for an improvement, rather than further softness," Dr Cullen said. UBS NZ chief economist Robin Clements said today's figures made the chances of a further easing of the official cash rate in September slimmer. "I thought, well, if we get a June quarter that maybe has a minus sign on the front of it then there may still be the need to cut again, but maybe the domestic economy is just hanging on better than expected," he said. Mr O'Donovan said today's retail sales data was "the final nail in the coffin of a September interest rate cut". Meanwhile, Deutsche Bank senior economist Darren Gibbs said his organisation "continues to see a 25bp rate cut as marginally more likely than not at the 4 September meeting". Deutsche Bank forecast the central bank's Official Cash Rate to be cut to 4.25 per cent by the end of the year. Today's data showed seasonally adjusted retail sales rose most strongly in the North Island where they increased by 0.6 per cent in the quarter, compared with a 0.4 per cent fall in the South Island. Wellington was the strongest performing region with a 1.1 per cent increase in seasonally adjusted retail sales. Sales during the quarter increased in 11 of the 15 store types. Motor vehicle sales for the quarter at constant prices rose by 4.4 per cent, while motor vehicle services remained unchanged largely due to a fall in petrol prices over the quarter. Excluding the motor vehicle sector, seasonally and inflation-adjusted retail sales were up 1.1 per cent for the quarter driven by higher sales in recreational goods (up 5 per cent), appliances (up 4.2 per cent), and footwear (up 4 per cent). Today's data was welcomed by the sharemarket where retail company stocks perked up. The Warehouse closed up 16c at $5.03, Briscoe Group rose 8c to $1.80, and Pacific Retail was up 10c at $2.30.

From http://www.stuff.co.nz/ 08/11/2003

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Govt to Focus on Debt Level - Cullen

The Government's finances will focus on the level of public debt rather than the budget balance or Oberac (operating balance excluding revaluations and accounting changes), Finance Minister Michael Cullen said today. In speech notes for delivery to a public sector finance conference, Dr Cullen said commentators had failed to grasp that the operating balance or the Oberac, or a mix of the two, "is no longer the primary goal of fiscal management". "The Government now manages more directly to our debt objective of gross sovereign debt below 30 per cent of GDP (which is) the end rather than the means," Dr Cullen said. New Zealand's gross debt is expected to be 27 per cent of gross domestic product (GDP) and net debt of 14 per cent of GDP for the year to June 30, 2003. Dr Cullen said the problem with Oberac, a measure his Government has promoted strongly, was that it had been "too successful". He said the focus on debt was because it was possible to run surpluses or deficits for short periods without significantly affecting the Government's ability to spend. "It can do this by covering the difference through running down or building up debt." Too much debt meant too high a proportion of government revenue was spent servicing that debt. "Equally, too little debt can reflect poor management. It may be a consequence of neglecting infrastructure, or under-funding education and other social programs." Dr Cullen repeated early signals that the Government planned to explore public-private partnerships (PPPs). Such vehicles achieved a better mix of risk distribution in design, construction and operating phases, he said. While it did not remove all the cost from central government, it re-balanced it and could accelerate infrastructure development. Dr Cullen also signalled the Government would want State-Owned Enterprises (SOEs) to raise more capital on their own behalf and leverage their balance sheets more aggressively. He said it was a priority for government to impose some more "financial discipline" on SOEs to ensure crown capital was available for other priority areas. He said the Government had set a target to introduce international financial reporting standards to the 2007 budget.

From http://www.stuff.co.nz/ 08/19/2003

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PNG: Govt to Raise Income Tax

THE GOVERNMENT has worked itself into a tight corner on revenue sources for next year£r budget and is considering measures to hit individual£r pockets, including a substantial but unspecified increases in personal income tax and a 5 per cent increase in sales and services tax (from the current 10 per cent to 15 per cent). On top of that, there is the possibility of a 0.01 per cent levy on withdrawals from commercial banks, which in kina terms means that for every K100 withdrawn, a fee of K1 will be collected by the banks for the State revenue. The Somare-Marat government has worked itself into this rut by giving tax concessions to the mining industry and the so-called Somare£r Green Revolution initiatives to attract large-scale agricultural investments. It has not helped matters also by placing itself at the mercy of provincial governments in agreeing recently that from next year, the provincial government would retain 80 per cent from their collection of the good and services tax while the Government gets 20 per cent. The Government has had to borrow K300 million domestically to bridge budget shortfalls caused by loans from the Asian Development Bank and the World Bank not being released. Treasury Secretary Koiari Tarata was reported to have said in one of the budget planning meetings (that has been on-going for over a week) that the government was now short of options to raise more revenue. - Post Courier/PINA Nius

From http://www.pacificislands.cc/ 08/20/2003

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Asia-Europe Meeting (ASEM) Grant to Boost Productivity of Private Firms

MANILA - The World Bank and the Philippine Government recently signed an ASEM grant agreement of US$300,000 that will help establish key policy actions to increase the productivity of private firms. Better productivity growth will strengthen firms' resilience to financial volatility or crises, as well as boost incomes, employment and poverty reduction. Four key aspects of technical assistance and capacity building will be supported by this grant: Trade Liberalization and Competition - An assessment will be undertaken of obstacles to competition and their impact, including both remaining trade barriers and 'behind the border' barriers to competition. Linkages with Multinationals - Technical assistance will be given to evaluate strategies for deepening linkages between domestic and foreign firms and the potential for technology transfer and learning, including a review of incentives and restrictions on subcontracting to domestic firms. Skills development - Ways will be suggested to improve the effectiveness of skills development and training through better matching with the private sector's needs. Technology Absorption - Recommendations and technical assistance will be given for strengthening of technology institutions. The work under this grant will help the Philippine Government have a focused, more in-depth look at key areas that improve competitiveness and productivity," said Virgilio P. Fulgencio, Executive Director for the Center for Industrial Competitiveness, National Industrial Manpower Training Council of the Department of Trade and Industry. "Increased investment and productivity in the private and public sectors are building blocks for sustained growth and poverty reduction. This grant supports the Government's efforts to create a business environment conducive to boosting productivity in the Philippines. This is critical for future crisis prevention and sustained poverty reduction as well as for achieving greater regional and global integration," said Milan Brahmbhatt, Lead Economist for East Asia and World Bank's Task Team Leader for the project. The grant covers a period of two years. All activities under this grant are expected to be completed on or before December 31, 2004. The list of ASEM donors supporting this grant are China, Denmark, European Commission, Finland, France, Italy, Korea, Luxembourg, Netherlands, Sweden, Thailand and United Kingdom.

From http://web.worldbank.org/ 08/05/2003

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CHINA: Private Higher Education Comes of Age

Each year, millions of carp go upstream and congregate at Dragon Gate, a section of the Yellow River, to try their fortune -- but only 72 of them are lucky enough to jump over the mysterious gate and become mighty dragons, according to a Chinese legend. For Chinese youth, the annual national college entrance examination is a similar travail. Those who pass the exam receive a good education, find well-paid jobs and generally lead better-off lives; but the majority of the students who fail the exam will most probably become blue-collar workers, salespeople or start small businesses, which may yield low incomes. No wonder the examination is aptly described as "tens of thousands of people trying to cross the river on a one-log bridge simultaneously." The cruel competition results from the simple fact that China is plagued by scarce education resources. As a developing country that boasts one-quarter of the world's schooling population, China has only 1.5 percent of the world's financial resources for education. Moreover, until recently, the government had almost exclusively financed public education, discouraging and even forbidding the funding of education with private money. It was not until 1982, shortly after the country launched its reform and opening-up policies, that the country's first private higher education institution -- China Social University -- was established in the capital with the approval of the Beijing Municipal Education Commission. Development was slow after that. By 1998, almost two decades later, the total number of private colleges and universities nationwide was no more than 22. In 1987, Ding Zuyi, who was deprived of higher education 45 years ago for political reasons, initiated China's biggest private university, the Xi'an Translation College in Northwest China's Shaanxi Province. The self-taught worker-turned-university-president believes that students who fail to pass the college examination could become professionals of a high calibre if they have the opportunity to receive further education. In the 16 years since its establishment, the college has evolved into a modern education giant with 600 million yuan (US$72 million) worth of fixed assets and some 25,000 students on campus; of whom 98 percent find jobs soon after graduation. In June 2002, some joint ventures recruited some top students of the college even before their graduation, promising annual salaries of as much as 400,000 yuan (US$48,000). The college is financially stable, too. It earns a profit of some 150 million yuan (US$18 million) annually. In 1998, 1999, 2000, and 2001, the college enrolled 6,800, 7,000, 9,700 and 8,300 students respectively. More than 80 percent of the newly-enrolled students had a higher score than the minimum college enrollment requirement set by Shaanxi Province. "This shows that private colleges have also become the choice for some students who could attend public colleges," President Ding said. However, owing to the influence of traditional concepts and management systems, most private schools still face difficulties. The government imposes stringent standards when gauging their credentials as educators. Some local authorities simply see private colleges as nothing more than money-making machines than institutions providing a much-needed service. "Private schools are generally regarded as inferior to their public peers, and without any reputation," says an official on condition of anonymity. As a result, public colleges and universities are still the first choice for students, who turn to private schools only as a last resort. In 1999, China adopted a higher education expansion policy, and the central government delegated the authority of accrediting non-degree-granting institutions to provincial governments. This change has helped elevate many private institutions that had previously provided only "self-study programs" to prepare students for national college entrance examinations. Since then, the private education sector has witnessed a boom. As of 2002, the country had some 1,200 non-government-run institutions of higher learning, with a combined student enrollment of 1.5 million. On December 28, 2002, China promulgated its first national legislation on private education, which explicitly stipulates that students of non-public education institutions enjoy the same rights and interests as their counterparts in public schools with regard to entering schools for higher degrees and employment. The new law goes into effect on September 1 this year. A significant clause of the law "allows investors in private schools to gain a reasonable profit after setting aside operational expenses, a development fund and other necessary outlays," according to Chinese experts. Yang Chun, an official with the China Adult Education Association, notes that the clause has helped solve a major problem that has bedeviled the development of private education for dozens of years. "Private schools should not be profit-driven, but a reasonable economic return is a crucial precondition," he says. Meanwhile, he points out some problems of the new law -- it fails to solve the permanent residence permit (hukou) of teachers who might be employed by private colleges in other cities. Despite limitations of the new law, Ding is all optimism. "We've travelled a long way, from being merely complementary entities to public colleges and universities to being their rivals," he says. "With the law, we can certainly do better."

From China Daily 07/31/2003

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State Shares Sold in Shenzhen

Shenzhen, China's pioneer of market economy reforms, yesterday sold some of the State-owned shares in a gas distribution company to a private Chinese mainland firm and Hong Kong & China Gas -- a dominant gas supplier in Hong Kong.The US$60 million deal is part of the local government's massive reform to reduce its influence over State-owned utilities companies.Under yesterday's deal, Hong Kong & China Gas paid around 377 million yuan (US$45 million) to take a 30 per cent share in the Shenzhen Gas Group -- the dominant natural gas supplier in the city. New Hope Group, which is controlled by mainland tycoon Liu Yonghao, bought 10 per cent of the shares at a price of 125 million yuan (US$15 million). The Shenzhen Investment Management Co, which represents the government to manage the State-owned assets, holds the controlling 60 per cent.The operating period for the joint venture lasts 50 years.The deal is the second one to be reached after the government announced its plan to sell off some State shares in five utilities firms covering water, food, electricity, gas and transportation. In January, the local government sold shares of Shenzhen Energy, a major local electricity firm, to overseas listed Huaneng Power for 2.3 billion yuan (US$278 million).Shenzhen Gas was a hot property on the market, after the government announced that its shares were up for sale. Major international and domestic firms, such as BP and Hong Kong's Pava Gas and China National Offshore Oil Co have shown a great interest in the purchase, in a hope to cash in on the rapid growth of gas consumption in the booming city.More importantly, Shenzhen Gas controls 10 per cent stakes in China's first LNG terminal. Starting from 2006, the Shenzhen-based terminal will sell US$10 billion worth imported liquefied natural gas (LNG) to customers in energy-hungry Guangdong Province for 25 years, which is believed quite lucrative.Hong Kong & China Gas has already holds a 3 per cent share in the terminal.Optimistic about the prospects for the natural gas business on the Chinese mainland, Hong Kong & China Gas has poured billions of US dollars into gas distribution joint ventures in dozens of mainland cities.It is said the company plans to invest up to 3 billion yuan (US$362 million) in gas projects over the next two or three years.Li Heihu, president of Shenzhen Investment Management Co, said the sale of the shares not only brings in fresh capital to sustain the development of Shenzhen Gas, but brings in know-how to help the company grow into a top-notch international utility company.

From China Daily 07/30/2003

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State-owned Hospitals in China to Embrace Market

More State-owned hospitals in China are to lose their government support and will have to adapt to the market as the country's entire health service undergoes inevitable reform, experts predicted. The relevant departments under the State Council, such as the Ministry of Health and the State Development and Reform Commission, are making investment plans with huge budgets to improve the country's public health networks, according to a three-day national working conference on health that ended on July 30 in Beijing. One of the main tasks in the coming years will be further development of the health care system so that it can better prevent and control epidemics such as SARS. The newly added task is expected to bring new change to the system of providing medical treatment, another side of the reform campaign, said Cai Renhua, director of the China National Health Economics Institute. One change to the medical system in China, a developing country that still can only allocate limited funds to health care is that the various levels of government should give up their ownership of and financial support to many state-owned hospitals, Cai said. While encouraging more hospitals to adopt market principles, governments at various levels should also continue to own some high-level general hospitals, infectious disease hospitals, medical academies, and hospitals of traditional Chinese medicines, Cai said. Currently, most of China's hospitals are state-owned and under pressure to make major changes to lower their medicine prices and improve their efficiency and services.

From People's Daily 07/31/2003

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Gov't-run Press in China Faces Shake-up

Party and government-run newspapers and magazines will be forced to commercialize or face closure under major reforms. According to detailed rules issued by the State Press and Publication Administration recently, some papers will be closed down, annexed or transferred to other newspaper groups, while others will become free information circulars. Yu Guoming, a scholar with Renmin University of China, was quoted by Caijing Magazine as saying the decision to turn newspapers and magazines into businesses means the law will recognize capital invested in the media. As a result of the planned economy, a number of newspapers and magazines run by party branches and government departments are financially supported by administrative orders that increase their circulation. "These newspapers and magazines have proven burdensome for people who subscribe only because of administrative orders, and fostered corruption, too,'' said Tang Xujun, a scholar in press with the Chinese Academy of Social Sciences. If less than half of the readers of a newspaper or magazine pay for the publication out of their own pocket, it will face closure next year. "This standard helps us to judge whether the newspaper or magazine has the ability to survive in the market,'' said Tang, who researched newspaper groups' operation and management. As the state administration takes control over newspapers and magazines in China, clearing out unprofitable publications will make way for those with more vitality, he said. State administration statistics show there were 2,137 newspapers in China last year, but newspapers relying on administrative orders for subscribers accounted for 40 per cent of the total, said Tang. "The implementation of the detailed rules may affect at least 200 newspapers and magazines,'' he said. Hunan Province in Central China has already drafted a plan for 56 newspapers and magazines considered unprofitable.

From http://english.peopledaily.com.cn/ 08/05/2003

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Think Tank: No Haste for Private Banks

ConAt a high-profile symposium recently held in Beijing on private banks, financial think tanks put forward various ideas for the five trial private banks so they could likely get clearance from the regulator to open. However, many of the concepts were disappointing as they did not answer some of the most critical questions. What is the role of private banks in China's banking sector? How are new financial risks avoided as the state-dominated industry accepts private newcomers? These questions need to be fully thought through on the eve of private capital's accession to the Chinese banking industry. At the symposium, some economists took for granted that given private firms' prominent performances in many sectors, private banks would be more flexible and competitive than state or foreign-funded banks. Such a viewpoint does not ring true. Despite their admirable successes in the country over the past two decades, many private companies have internal problems such tax evasion and being controlled by a single family. Private banks may also strike similar problems. As ownership and management are clearly divided in modern corporations, it is not reasonable to judge a bank merely by its ownership. The operation of all banks -- state-owned or private -- are in strict accordance with corporate law, banking law and other regulations. Banks owned or controlled by the state can also be competitive if they have sound governance structures and market-oriented operational mechanisms. In fact, it is difficult to tell whether a bank is purely a "state" or "private" entity nowadays because many banks have plural ownership structures with both state and private capital. The point of private capital's entry to the sector is not in the so-called competitiveness of private banks. Rather, it is a sign that the banking industry is ready to open equally to all kinds of capital, state or private, domestic or foreign. tent
No special favors A lot of people hope private banks will naturally boost the growth of private businesses. Sadly, that may simply not be the case. Some economists and entrepreneurs would use piles of statistics to prove the rapid growth of the private sector and its remarkable contribution to the economy. And very likely they would come up with a specious suggestion: For further growth of the private sector, private banks are needed to serve fund-hungry private firms. Like state-owned banks, which do not merely serve state companies, it is not realistic to want private banks to specifically serve private firms. Admittedly, state banks sometimes tend to favor powerful state-owned or foreign clients while leaving small private firms out in the cold. Even if a private firm has credit as good as state-owned companies, it may get discriminatory treatment. However, creating private banks to particularly serve private firms does not help improve the lopsided banking service - it makes the industry more askew. To eliminate discrimination in the banking service, it is more important to untangle the complex relations between banks, enterprises and government agencies. Ideally, both state-owned and private banks should serve different clients according to their credit situation, regardless of the difference of ownership.
Be patient Most of the private bank formulae discussed at the symposium were very ambitious. Some were even pushing for the creation of "the Citibank of the East" within three to five years. Such a big vision, if not a pipe dream, at least shows many are not clear about the goal and the core competitiveness of private banks. Commercial banks are not highly profitable. Their profit margins are lower than many lucrative industries. The uniqueness of banks is that they can control astronomical amounts of money that may be dozens of times superior to their own capital. This brings great opportunities as well as huge risks. A successful bank must have a complete management structure and steady development strategy. Quickly expanding banks often have to pay a price for a lack of steadiness. At a time when the creation of private banks is still only on paper, their planners' sensible longing for quick expansion is a worry. Generally speaking, private banks have little competitive edge in terms of capital size, management and experience. It is very dangerous to pursue overnight success under such circumstances. Private bankers should find and focus on their real strong point: Grass-roots banking services. As major state-owned banks withdraw from rural banking services and foreign banks focus on prosperous coastal metropolises, private banks will have plenty of opportunities in rural areas and small townships. It is not an illusion that a private bank can grow to become a powerful financial conglomerate, but it is likely to be a long journey full of fierce competition.
Good entrepreneurs equal good bankers? The involvement of successful private enterprises with private banks cannot help the banks win trust from watchdogs and depositors. What is more, their motion of participation is questionable. It is easier for a successful private enterprise, which has already earned a reputation for profitability and management, to get financial support from state-owned banks and to list on the stock markets in Shenzhen, Shanghai and Hong Kong. There is little necessity for them to enter the banking industry, in particular, to be a shareholder of a private bank. Two objectives exist: Diversification of operations and the collection of money. But for a successful private company, it is widely accepted by foreign and state-owned banks. Why do they need to be a shareholder of a private bank with high risks? Then, collecting more money through private banks, which should be guarded against, becomes the only objective. The creation of private banks is also a challenge for private companies and supervisors. Stories from Russia, Taiwan and Indonesia prove that private banks can create large financial crisis. As a result, private companies should create a convincing mechanism to control risks before they want to set up private banks. They also need to persuade depositors that they can protect them. State-owned banks can insure benefits of depositors through government credit. If private banks can offer more interest coupled with compulsory insurance for deposits, they can allure depositors to their banks. A well-mapped plan is much more needed than a desire for haste.

From China Daily 08/10/2003

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World's Largest, U.S. Public Asset Management Company to Invest in Guangxi

The Guohai Franklin Fund Management Co., Ltd. (under preparation) co-founded by the Guohai Securities Co., Ltd. and the Templeton International Inc. under the US-based Franklin Templeton Fund Group has recently got the green light for establishment from the China Securities Regulatory Commission. The joint-ventured Guohai Franklin Fund Management Co., Ltd. (under preparation) will have a registered capital of RMB 100 million, in which the Guohai Securities Co., Ltd. will have 67 per cent shareholdings, and the Templeton International Inc. will have 33 per cent shareholdings.

From FDI 08/14/2003

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China Breaks Up Power Monopolies to Form Six New Areas

BEIJING - China is breaking its traditional province-based electricity monopolies in a move to create six regional competitive power markets in three years. The Chinese government piloted the scheme with the establishment of the Northeast China regional power market last June, one of the planned six new markets. The other five will be North China, East China, Central China, Northwest China and South China power markets. In each regional market, an electricity distribution and trading center will be established as a platform of fair competition among electricity enterprises, along with futures and options market for electricity trading, said Jia Yinghua, deputy director of the power supply supervision department of the State Electric Power Regulatory Commission.

From http://www.asiapulse.com/ 08/15/2003

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Guangzhou's Private Firms Play Bigger Role

The private sector in South China's Guangdong Province reported year-on-year growth of 170 per cent in foreign trade during the first seven months of this year to US$10.74 billion, customs figures showed. The figure, comprising US$5.11 billion in exports and US$5.62 billion in imports, represents 7.2 per cent of the province's total trade for the seven-month period, or up 3.8 percentage points over last year.

From China Daily 08/19/2003

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JAPAN: Koizumi Denies Postal Plan Report

Prime Minister Junichiro Koizumi denied Wednesday he plans to set up an official committee on privatizing Japan's postal services to boost studies that his private panel conducted in 2001 and 2002. "I have no such idea," Koizumi told reporters at his office, commenting on a business daily's report about the possibility. Chief Cabinet Secretary Yasuo Fukuda also denied it at a news conference earlier Wednesday. The report came after Koizumi declared Tuesday his intention to privatize the three postal services in fiscal 2007 despite opposition from many heavyweights in the Liberal Democratic Party, which he heads. Fleshing out the plan has been a political focus. Koizumi is a proponent of privatizing the three postal services of mail delivery, "kampo" life insurance and postal savings. The public corporation Japan Post currently deals with them. Koizumi's private panel headed by economist Naoki Tanaka was launched in 2001. The panel drafted a final report about privatization of the postal services last year, but failed to present in it a clear outline for the project. The Nihon Keizai Shimbun reported in its Wednesday morning editions that Koizumi is considering upgrading the panel to an official advisory body backed by law. Specifically, he intends to establish a postal privatization committee under Article 8 of the National Government Organization Law, the daily said.

From The Japan Times 07/31/2003

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Japan Allows Private Firms to Set Up Derivatives Markets

Japan's Ministry of Economy, Trade and Industry and the Agriculture Ministry have decided to allow private companies to set up their own financial derivatives markets to hedge against future price fluctuations. Trading houses, banks and other companies have increasingly been trading derivatives directly with each other, but they are only permitted to do so at seven public commodities exchanges. The ministries want to allow them to establish their own markets for re-hedging derivatives trades, such as Internet-based oil futures markets - which are increasingly common in the US and Europe - to help them procure raw materials at stable prices. The ministries are preparing to submit bills revising the commodities trade law to the next regular Diet session in spring 2004. Companies wanting to establish their own markets will be required to obtain government approval, and then periodically report on them to the authorities after they are set up.

From http://www.channelnewsasia.com/ 08/10/2003

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Kodak to Move All Digital Camera Operations to Japan

TOKYO - Eastman Kodak Co. of the U.S. will consolidate its digital camera planning and development operations in Japan in a bid to beef up its digital camera development capability and secure a larger global market share. This autumn, the firm will transfer its product planning, design and other digital camera operations from its headquarters in Rochester, New York, to Japan. Kodak also plans to establish a digital camera company in Japan next year that will be separate from its Japanese arm and responsible for overall digital camera operations.

From http://www.asiapulse.com/ 08/18/2003

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Japan Highway Launches Panel on Privatization

Japan Highway Public Corp. said Monday it has launched a private-sector-led advisory organ to help pave the way for the quasigovernmental body's privatization in 2005. The panel is headed by outside experts who have been working at Japan Highway since April 21; it will advise Japan Highway President Haruho Fujii. Ken Moroi, who also serves as a counselor to Taiheiyo Cement Corp., was appointed chief director of the panel. Hironori Aihara, vice president of Mitsubishi Corp., and Nobutake Sato, vice chairman of Ito-Yokado Co., were appointed deputy directors. Moroi said the panel will make further appointments from the private sector, seeking to exploit these individuals' managerial experience and know how. To this end, the panel will set up several committees dealing with the reduction of expressway construction and maintenance costs, personnel streamlining, the lowering of tolls and the promotion of information technology. Moroi then outlined his personal plans to cut expressway costs by 30 percent, trim personnel by 20 percent and lower expressway tolls by 10 percent. The panel will hold its first meeting on Aug. 27 and will submit reports on the issues at hand until the corporation becomes a privatized entity in about two years. Touching on calls for Fujii's resignation, Moroi said he has no intention of becoming a "bullet proof vest" for Fujii and will do his utmost to improve the nation's expressways. (by Tetsushi Kajimoto)

From The Japan Times 08/19/2003

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SOUTH KOREA: Ministry Approves Five Private-sector Construction Plans

The Ministry of Planning and Budget (MOPB) reported that its committee approved on Wednesday (August 13) five construction projects, including those for a new Bundang subway line and the Youngdeok-Yangjae highway, to be carried out by the private sector. The committee also authorized the development plans for three other projects: wharf constructions at Pyeongtaek Port and North Incheon Port, and the building of a Combined Freight Terminal for the Metropolitan Region. The ministry said it would speed up the required procedures, such as recruiting interested businesses, working out contracts, and drawing up action plans, so that the projects will be completed early. The investments needed for the five projects above were estimated at 2.7 trillion won. As of August 2003, 48 private sector-invested construction plans are either under negotiations or have been signed. The total budget of the five projects will amount to 27.4 trillion won.

From http://www.kois.go.kr/ 08/18/2003

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MALAYSIA: Private Sector Not Keen on Local Graduates

KUALA LUMPUR: The Government is concerned that the private sector prefers to employ those from foreign universities and local private colleges rather than those who graduate from public universities in the country. Human Resources Minister Datuk Dr Fong Chan Onn said this was one of the reasons his ministry set up the Graduates Training Scheme. Dr Fong, who spoke to reporters after launching the Graduates Training Scheme II here yesterday, said response from the previous intake of 12,449 graduates for retraining indicated various reasons why private sector employers were not too keen to hire local graduates. Among the reasons were: INABILITY to communicate well in English; LACK of Information Communication Technology (ICT) proficiency; LACK of interpersonal skills; and HESITATION to pursue the ¥Axtra mile? such as working late and long hours. The training scheme is carried out through the ministry's resources development corporation, Human Resources Development Bhd (HRDB). The previous scheme offered retraining in English, Mandarin and ICT while the current scheme provides more professional-based programmes, such as business accounting, sales and marketing, Microsoft Certified System Engineer, Linux System Administrator and Cisco Certified Network and Professional courses. Training programmes under the latest scheme is application-based and I believe that those undergoing it would have vast opportunities in the employment market,?he said. The programme, which involves more than 170 training providers, has been allotted RM100mil under the recent economic stimulus package. Dr Fong said the current scheme also offered a two-month attachment stint in private sector organisations to familiarise the trainees with work culture there. He said he has instructed HRDB to involve the private sector in the scheme through the attachment programme as it was important for the graduates to have a firsthand experience in finding out what was expected of them. (by Wani Muthiah)

From http://202.186.86.35/ 08/20/2003

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PHILIPPINES: OPIC Sets Transco Privatization as Pre-Condition to $250-M NPC Loan

The Overseas Private Investment Corporation (OPIC) has also set the privatization of the National Transmission Corporation (Transco) as a pre-condition to the approval of the risk insurance for the $250 million loan being sought for state-owned National Power Corporation (NPC), according to an official of the United States Embassy. Such policy was set forth in consonance to the requirement that was also set by the Asian Development Bank (ADB), which is eyed to extend partial credit guarantee (PCG) for another $250-million loan for the state-run power firm. "OPIC wants to see the privatization of Transco coming before giving approval to the risk insurance. We believe that so far, the effort of government with respect to that is moving forward," said US embassy economic specialist Daniel Martinez. There have been ray of hope that the Transco may finally be disposed from government hands before the end of the year; since they have been sending indications that if there would be another round of failed bidding in October, they would already resort to a "negotiated deal." Already, the government declared failure of bidding in the first round, with only Singapore Power submitting a tender. President Gloria Macapagal Arroyo earlier stressed that even if there is only one bidder for Transco, "that's already good enough".It has been set clear under the bidding parameters that if there would be less than two bidders in the two rounds of auction, the next option for the government, through the Power Sector Assets and Liabilities Management Corporation (PSALM), would be to enter into a negotiated deal for the 25-year concession contract for Transco. On NPC's funding, the national government earlier raised for it some $750 million via a bond offering; and this would already account for a significant chunk of its programmed $1.2 billion funding this year. In fact, $200 million has already been infused early this year through a private placement. This means that NPC would just need another $250 million to fully cover its funding requirements this year. PSALM president Edgardo del Fonso earlier noted that they are still considering both the ADB-guaranteed or OPIC-covered loans; but he emphasized that they will tap whatever will come first. (by Myrna M. Velasco)

From http://www.mb.com.ph/ 08/17/2003

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THAILAND: Private Sector Has Role to Play

Prime Minister Thaksin Shinawatra yesterday urged the management of schools across the country to embrace technical support from the private sector in education reform. Speaking at a meeting aimed at defining management strategies for "dream" schools at the Bangkok International Trade and Exhibition Centre, Thaksin said the government wanted the private sector to play an active role in education reform, not just provide financial support. He told the meeting, attended by management and staff from 921 selected dream schools, as well as 5,000 students and business leaders, that the government's desire for private sector support for the "one school, one district" project was not just about stretching the education budget. "We want the private sector to introduce new technology and an innovative approach to schools. For instance, THAI [Thai Airways International] has proposed sending airhostesses and stewards to teach English to students and show them how students in other countries study," he said. Thaksin also said more state support needed to be extended to kindergarten students, as the first years of school are a crucial period in student development.

From http://www.nationmultimedia.com/ 08/02/2003

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MWA Corporatisation Proposal Under Study

Cabinet ministers are expected to consider a proposal tomorrow from the State Enterprise Policy Committee for the corporatisation of the Metropolitan Waterworks Authority (MWA), the first step towards the eventual privatisation of the water utility. A new act affirming the corporatisation would also call for the formation of a regulatory body to oversee water charges, service standards and other issues for the entire country. The MWA, which oversees water services in Bangkok, is expected to be listed on the stock exchange next year. Funds raised from the listing will be used for a new 60-billion-baht pipe infrastructure investments plan.

From http://www.bangkokpost.net/ 08/18/2003

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Council Against Privatising National Power Grid, Dams

The National Economic and Social Advisory Council has opposed a government plan to privatise the national power grid and hydro-electric power dams. It also asked the government to set up an independent body to monitor consumer interests, ensure fair prices, ensure transparency and issue operation licences. The council's suggestions were made amid mounting concern that consumers would suffer if electricity prices were fully driven by market forces rather than being controlled by the state. ``We do not oppose privatisation. We just want an independent regulatory body to make sure the energy business is accountable, transparent and will not sacrifice consumers' interests for profit,'' said council member Witoon Permpongsacharoen yesterday. He spoke at a workshop on the privatisation organised by the Electricity Generating Authority of Thailand, the Metropolitan Electricity Authority and the Provincial Electricity Authority. ``Not all commodities are fit to be listed and traded on the stock market,'' he said. The council will submit its proposal to the government in the next few weeks. A dam like the Pak Moon in Ubon Ratchathani was sensitive infrastructure because it was needed for farming and fishing, and contributed to an ecologically sensitive area, Mr Witoon said. The government could lose control over water management if the operation of hydro-dams, known as the cheapest source of electricity, was dictated by market forces, he said. The council proposed that the national grid be a state-run enterprise.

From http://www.bangkokpost.net/ 08/20/2003

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BANGLADESH: Higher Private Sector Bank Credit Leads to Increase in Real GDP

An increase in bank credit to the private sector leads to an increase in real Gross Domestic Product(GDP), decline in budget deficit, increase in trade deficit and decrease in price level. The observation came at a recent model study of Bangladesh Institute of Development Studies (BIDS) on macro-econometric models of the country. The study reveals that increase in public investment, exerts reduction impact on real GDP while increase in the case of Bank credit to the private sector. The researchers of BIDS carried out a policy mix experiment focusing on key instruments of fiscal monetary policies with simulation of a 10 per cent increase in public investment along with a 10 per cent increase in bank credit to the private sector. The result of the study suggested that private investment in all the sectors like agriculture, manufacturing and services increased by 3.43, 11.03 and 7.66 per cent respectively. Changes in investment results in increase in real GDP by 0.10 Per cent which effects on sectoral capital stock. The model study said government consumption expenditure was higher by 0.2 per cent in 1991 and government revenue was higher by 0.07 per cent. The domestic component of budget deficit declined by 0.20 per cent. The net effect of decline in budget deficit and increase in bank credit to the private sector is a marginal decrease in money supply. The effect of decrease in money supply on price level is reinforced by increase in real GDP and consequently price level decreases by 0.05 per cent in the initial year. In simulation of increase in private credit imports increase and exports fall resulting in deterioration in trade balance. The study also pointed out that in the present macro economic models of the country, the exchange rate devaluation lead to contraction of income, expansion of the budget deficit and increase in price level. The trade balance, however, improves as result of the devaluation.

From http://independent-bangladesh.com/ 07/28/2003

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Private Varsities

One of the impacts of the spread of commerce and trade has been the total drive towards business and technology-oriented disciplines offered by many of the private educational institutes. They are emphasising on commercially motivated subjects only and liberal arts or humanities are virtually ignored. We do not deny the importance of subjects like business administration and computer science but the basic impetus should be to produce well-rounded individuals. And for that to happen some knowledge of the liberal arts and social sciences are essential. The society and the country too need people of various disciplines. The authorities of some of the private universities say that there is no demand for students with liberal arts background in the job market. That observation is debatable. Evidence shows that people with arts background have had great careers and many with technological background have failed to make a headway. From a moral point of view getting a job can hardly be desired as the sole aim of higher education. President Prof. Iajuddin Ahmed also pointed out several other shortcomings of private universities, which have mushroomed in the recent years. While we are all for the spread of private sector education, the quality of the education they will provide cannot be compromised. A number of the private universities hardly merit the name, as they do not have adequate infrastructure and competent teaching staff. It has been alleged that many people have established higher educational institutes strictly for business purposes. They are in the field just for making a quick buck and the quality of education is the least of their concerns. The tuition fees in most private universities makes these rather prohibitive for students belonging to the less affluent sections of the society. It needs no elaboration that education should be for the rich only. However it must be said that some of the private universities are playing a good role in the spread of higher education in the country. The quality of education is high there and students graduating from these institutes are carving a niche for themselves in different sectors. Unfortunately that is not the case in most other universities.

From http://independent-bangladesh.com/ 08/01/2003

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Govt to Encourage Private Sector Initiative in IT Sector

Information Minister Tariqul Islam said yesterday the government would welcome any private sector initiative to develop efficient human resources in the fields of information technology and communications. "Public sector arrangements for developing efficient human resources in the areas of information and communications are in fact inadequate. Press Institute and National Institute of Mass Communications are running with meagre resources. So, we appreciate private sector initiative in the area of human resource development," the minister said, while inaugurating Bangladesh Institute of Communication Studies and Public Relations in the city. The institute has already launched a short-term course for interested media professionals and was planning to introduce diploma course in future. The minister hoped that this center would play an important role in grooming the media professionals. Chaired by Chairman of the Governing Body Anwar Hossain Chowdhury, the inaugural function was addressed, among others, by members SM Emdadul Islam and Nisar Ahmed, former ambassador Akramul Quader and Mirza Tarequl Quader. The present government always believes in free flow of information, he said, adding that it also opened up the country's sky. The course will be conducted by eminent journalists of print and electronic media, university teachers and IT experts, he added.

From http://independent-bangladesh.com/ 08/26/2003

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INDIA: Financial Bids for Hind Copper Selloff by Sept

Government is likely to invite financial bids for privatization of Hindustan Copper by mid September even as it awaits the consent of creditors for the sale. The inter-ministerial group on disinvestment which met recently, decided to go ahead with financial bids without awaiting the response from lenders. Sources said the meeting resolved that transaction documents had incorporated a provision for protection of lenders by way of substitution of guarantee. Bids for the copper major were delayed as Government resolved to settle the issue of guarantee extended to the bond and debenture holders. Lenders stood to lose the protection of guarantee which would cease upon disinvestment forcing the Government to ask the company to settle the matter with the former. Company chairman and managing director BK Menon who had been asked to negotiate with lenders is reported to have held two rounds of meetings with creditors earlier this month. The management had informed the creditors about the impending privatization exercise underway and had sought their approval for the same. The rethinking on the issue has been prompted by the fact that such approvals were not required till the bidding process was over and therefore there was no need to wait any further. A F Ferguson has been entrusted with the task of finding a partner, while Birla Copper and Sterlite Industries are reported to be in the race for Government stake. The company had raised close to Rs 250 crore a few years back in the form of bonds and debentures which are scheduled to be repaid starting next year. HCL raised Rs 150 crore in the form of bonds carrying an interest rate of 10.65 per cent while another Rs 100 crore were raised as bonds. The meeting also took note of the matters pertaining to environmental issues and mining leases.

From http://www.hindustantimes.com/ 08/25/2003

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MALDIVES: Private Sector Will Be Invited to Develop Housing in Hulhumale

MALE (HNS) -- Real estate housing units would be developed in Stage B of the First Phase of Hulhumale development. The Hulhumale Development Unit said that private companies would be contracted as real estate developers for building housing schemes in the newly-reclaimed island. The unit will discuss this with the private sector. In Stage B, there will be 750 housing units that would accommodate 4,326 people. This phase of development would be completed by December 2005. According to Hulhumale Development Unit, Stage A of the First Phase of Hulhumale development would be completed in October and people will start living in the island, reclaimed in the lagoon of Hulhule island, in December. The Hulhumale development project was launched in 1997 to address the acute housing problems facing residents of Male.

From http://www.haveeru.com.mv/ 08/02/2003

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New Private Airline to Take Off Next Month

FEYDHOO ISLAND, Addu Atoll (HNS) -- While works are underway to turn the domestic airport in Gan island into an international airport, a company is planning to launch an airline that would mainly fly between Gan and Male. Air Equator's Commercial Manager Adam Shafeeq said that most of the work needed to catapult the airline has been done. The aircraft that would be used by the airline would be based in Gan and the Civil Aviation Authority has already inspected the aircraft hangar that has been built at Gan airport. Shafeeq, who has 20 years work experience with the now defunct Air Maldives, said that cabin crew had been trained in Addu Atoll and have been sent to Male for further training. "Six of the students who did the Air Law exam are now in Male," he said. "Those trainees in Male would be given training on board aircraft as well." Air Equator plans to use an F27 aircraft, which has 50 seats, which can travel between Male and Gan in one hour and 10 minutes. "The aircraft will be brought to Male, from the United States, after it has been inspected by the relevant authorities. We are arranging for the inspection of the aircraft," Shafeeq said. At present, air services between the domestic airports are provided by the state-owned Island Aviation that came into being after Air Maldives went bankrupt. A private company, Ocean Air, also operated an arline with scheduled flights between Male and Gan, but later their services were stopped.

From http://www.haveeru.com.mv/ 08/05/2003

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PAKISTAN: 80 % Banking Assets to Go Private with SBP Monitoring

KARACHI, Pakistan: (PNS) - Governor, State Bank of Pakistan (SBP) Dr. Ishrat Husain has said that around 80% of the banking assets in the public sector would be privatized or given in private hands and the regulatory agency would only keep a vigilant eye on their working. Addressing a press conference at the Institute of Bankers here Saturday, he said the rationale behind the privatization of the Banks was to make them more responsible for their performance and risk management.

From http://www.paknews.com/ 07/28/2003

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Govt Will Not Privatize NBP: Shaukat

KARACHI, Pakistan: (PNS) - Finance Minister Shaukat Aziz said Friday that the government will not privatize National Bank of Pakistan (NBP) despite pressure from various quarters. He was speaking at a ceremony to announce the regularization Of NBP's temporary employees at its head office. "This is the only Public sector bank which will not be privatized despite pressures", he said. The minister said that this decision has further enhanced the responsibility of NBP's staff to prove their efficiency and professionalism as the government will not compromise on performance.

From http://www.paknews.com/ 07/27/2003

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PC Invites EOI from Consortiums-Investment Banks for Privatization of National Refinery Ltd

ISLAMABAD, Pakistan: (PNS) - The Privatization Commission has invited consortiums including Investment Banks with ample experience in privatization, restructuring and merger in the Oil & Gas sector to submit their Expression of Interest (EOI) to provide Financial Advisory Services for the privatization of National Refinery Limited. The Government has decided to privatize National Refinery Limited with a proposal to sell up to 51 % equity of NRL together with the transfer of the management control to a strategic investor. NRL is a petroleum refining and petrochemical complex consisting of one fuel refinery, two lube refineries and a BTX (petrochemical) plant. It is located in Karachi. The company's refineries have a combined processing capacity of 2,710,500 tones per annum of crude oil. During the last five years the plants have been operated at 87 % to 102 % of their crude processing capacity. For the financial year ended June 30, 2002, NRL's net Sales were more than Rs. 29 billion and profit after tax was Rs. 781 million. The company's financial performance has improved consistently over the last seven years. The parties interested in the transaction have been asked to submit their EOIs latest by August 31, 2003 along with their brief profile and the required processing fee.

From http://www.paknews.com/ 07/30/2003

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Privatization of PSO, PTCL, HBL on Schedule

ISLAMABAD, Pakistan: (PNS) - The privatization process of Pakistan State Oil (PSO), Pakistan Telecommunication Company Limited (PTCL) and the Habib Bank Limited (HBL) was very much on schedule and is expected to taken place well within the time-frame. This was stated by a spokesman for Privatisation Commission here Wednesday while commenting on the impression that political crisis hindering major entities sell off. "One fundamental characteristic of investors in the high value strategically important privatisations is that they look at the long-term opportunities in a country and as such are not greatly affected by day-to-day political events", the spokesman remarked. He said, the fact that HBL has been able to generate substantial interest representing investors from USA, Canada, Europe, UK and Middle East was a testament to the fact that investors were looking at Pakistan favorably and have a positive long-term view of the country. Such unprecedented interest would never have been received were the so-called "political situation" such a major issue, therefore, any impression to attribute delays in PSO and PTCL transactions to the events having no bearing on them were totally misleading and incorrect, he added. The spokesman further stated that PSO and PTCL were very much on schedule and were expected to take place well within the time frame agreed with the potential investors.

From http://www.paknews.com/ 08/07/2003

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PTCL Bidders Asked to Start Due Diligence

ISLAMABAD: The Privatization Commission has asked all three pre-qualified bidders of Pakistan Telecommunication Company Limited (PTCL) to start their due diligence from September so that the company could be privatized positively by December 2003. "And as soon as the due diligence is completed by the pre- qualified bidders, the bidding date for the PTCL would be announced," said Privatization and Investment Minister Dr Hafeez Shaikh. Talking to Dawn here on Saturday, he said it was good to see that some strong business groups from Turkey, Egypt, Saudi Arabia and Singapore were participating in the privatization of PTCL. He, however, made it clear only the three pre-qualified bidders would be allowed to participate in the disinvestment process. Dr Hafeez also said that out of 19 parties, seven had been pre-qualified to take part in the bidding of Habib Bank Limited. "We think there are only seven parties who have the real potential to bid for HBL." HBL would be privatized by December this year, he assured. He further stated that efforts were being made to resolve the 25-year long-standing issues of Hyatt Regency Karachi Hotel Project. The privatization of Pakistan State Oil (PSO) is being scheduled in October this year, he added. THATTA CEMENT: The Privatization Commission (PC) held a pre-bid meeting with the prospective buyers of Thatta Cement Company here on Saturday. According to an official handout issued here the prospective bidders sought clarifications about the bid documents, procedure and other issues relating to the transaction. The commission had received seven Expressions of Interest (EOI) from interested parties for the purchase of minimum of 90pc shares of Thatta Cement Company (TCCL) on "as is where is" basis. The Privatization Commission had invited EOIs in May 2003. The parties include Afzal Motors, Peshawar, Kohat Cement Company Ltd, Lahore, Shirazi Investments (Private) Ltd, Thatta (Sindh), Tariq Sayeed and Associates, Lahore, United Bank Ltd, Karachi and Universal Navigation & Trading (pvt) Ltd, Karachi. The bidding for TCCL is expected to be held during the current month and a final date in this regard will be announced shortly after consultation with the interested parties. Thatta Cement Company was incorporated in 1980 as a limited company under Companies Ordinance 1913 (now Companies Ordinance 1984) and is a wholly-owned subsidiary of the State Cement Corporation of Pakistan (SCCP). The unit is located 115 km north east of Karachi at Makli Ghulamullah Road, District Thatta. The plant is based on dry technology and has a capacity of 1,000 tons per day production. The entire plant and machinery was imported from Mitsubishi Corporation, Japan, while the slag-grinding mill has been supplied by HMC. The plant started commercial production in December 1982 and is fully operative. Its main products include Ordinary Port land Cement, Slag Cement and Sulphate Resisting Cement. The unit is located on 236 acres of land consisting of factory, officer and workers colonies complete with all facilities along with 4,725 acres of mining lease land (Quarry). The first bidding for TCCL was earlier held on September 7, 2002 and Privatization Commission received a highest offer of Rs696.431 million at the rate of Rs10 per share for the sale of 71,79 million shares i.e. 90pc shares of Thatta Cement Company Ltd (TCCL) on "as is where is" basis, including Rs383 million loan liabilities and 50pc of GHS/VHS to be paid to the employees by the buyer which was around Rs45 million making the total above Rs1 billion. The Cabinet Committee on Privatization (CCoP) in its meetingheld on September 23, 2002 had approved the bids received for Thatta Cement Company but the successful bidder defaulted and failed to deposit the bid amount as per sale schedule. As per laid down procedure PC forfeited the earnest money worth Rs50 million.

From http://www.dawn.com/ 08/17/2003

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ARMENIA: Health Minister Suspends Hospital Privatizations

Senior parliamentarian Armen Rustamian told RFE/RL's Yerevan bureau on 21 August that Health Minister Norayr Davidian has suspended the privatization of medical facilities. Both men are members of the Armenian Revolutionary Federation-Dashnaktsutiun, one of the two junior partners in the coalition government. On 18 August, parliament speaker Artur Baghdasarian called for a halt to the privatization of hospitals on the grounds that many Armenians cannot afford private medicine. State Property Committee Chairman David Vartanian rejected that argument two days later and said the privatization process would continue (see "RFE/RL Newsline," 19 and 21 August 2003). LF

From http://www.rferl.org/ 08/22/2003

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GEORGIA: Sale of Georgian Energy Company Shares Sparks Controversy

Opposition parties and some members of the Georgian government expressed concern on 1 August at the implications of the announced sale to a subsidiary of Russia's Unified Energy Systems (EES) of a controlling packet of shares in Tbilisi power-distribution company TELASI, Georgian media reported. Antimonopoly Service head Armaz Tavadze said he believes the sale is illegal, as the Georgian government was not informed in advance. Minister of State Avtandil Djorbenadze and Justice Minister Roland Giligashvili questioned whether TELASI's former owner, the U.S. company AES, was legally entitled to sell the shares. Parliament on 1 August summoned Energy Minister David Mirtskhulava to explain the background of the sale, but he failed to appear, Caucasus Press reported. Earlier on 1 August, Mirtskhulava told journalists that the Georgian government had done all in its power to prevent the sale, but without success. LF

From: http://www.rferl.org/ 08/04/2003

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KAZAKHSTAN: Kazakhstani Property on Lssyk-Kool Lake

The prime minister of RK has signed an order on an establishment of the working group in the government of RK to settle the issues of property rights of RK on Issuk-Kool lake, KZ-today has been advised by the chairman of the committee for state property and privatisation of the Ministry of Finance of RK Gennadiy Komarov today, on 8 August. According to G. Komarov, the government of Kyrgyzstan is going to take over five sanatoriums belonging to Kazakhstan: "The automobilist of Kazakhstan", transferred into fiducial management, the sanatorium "Kazakhstan" of the medical centre of president affairs management, the sanatorium "Almaty", the holiday home "Samal" the home "University" of Kazakh National State University. Meanwhile in 1992 an agreement was signed in Bishkek, according to which the facilities belonging to CIS states located on the territory of other CIS countries, remain the property of their owners. Thus, sanatoriums built by enterprises and organisations of Kazakh SSR remain the property of their owners. In its turn the government of Kyrgyzstan saying that the provision did not concern the republic of Kyrgyzsan officially notified the government of RK about the cessation of Kazakhstani property rights for the 5 facilities and proposed to buy them or rent them. A plenipotentiary government commission has been established by the government of Kyrgyzstan to settle this issue. The working group of RK is headed by G. Komarov, the chairman of the committee for state property. Also representatives of concerned authorities and sanatorium owners, including the MFA, the Ministry of Justice, the medical centre of president affairs management, Kazakh National State University, the Agency for Tourism and Sports were included into the group.

From http://www.gazeta.kz/ 08/08/2003

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AUSTRALIA: Private Power to Save State from Blackouts

The NSW Government has no plans to invest in new power stations - instead it is relying on private investors to take care of the state's future electricity needs. "There are no plans for us to spend money on generation capacity," the Minister for Energy and Utilities, Frank Sartor, said. He was responding to a report in the Herald yesterday that the state faced electricity blackouts as early as the summer of 2005-06 as strong demand for power outpaced generating capacity. "We believe the national electricity market will take care of these issues," he said. "If that proves to be a problem in the future, then we will consider it." However, electricity prices might also need to rise, Mr Sartor said. This was to encourage investment in new power stations because wholesale electricity prices remained low. "The market isn't giving these price signals," Mr Sartor said. "There is a disjunction between [electricity] prices and the timing of new investment. Prices will probably rise to an extent." Until now NSW has relied solely on coal-fired power stations, although private investors are planning gas-fired power stations near Wollongong and at Wagga Wagga. "We don't know what the equilibrium will be between gas and coal base-load capacity. It should sort itself out. If not, five years down the track the Government will need to intervene." Mr Sartor conceded that if extreme weather conditions combined with equipment failures, blackouts might be unavoidable. "In a severe peak . . . there will be very localised load shedding to maintain the system," Mr Sartor said. A spokeswoman for the United States-owned TXU, which has bought the Tallawarra site on Lake Illawarra near Wollongong, said the utility was planning to develop a 400-megawatt power station at the site to meet expected demand from 2008 - well beyond the period when NSW is expected to face summer blackouts. Mr Sartor is due to attend a national meeting today of state and federal energy ministers that aims to win full support for a new regulatory system for the electricity market. At present, the electricity market is controlled by the National Electricity Code Administrator and the competition regulator, the Australian Competition and Consumer Commission. Mr Sartor said that with a single regulator competition between the two groups would be avoided and private investment in new power plants would be encouraged. "We think that one body with appropriate expertise will lead to better rule making," he said. (by Brian Robins)

From http://www.smh.com.au/ 07/31/2003

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Costello Admits Long Road to T3

TREASURER Peter Costello admitted it will be tough to pass legislation allowing the full sale of Telstra through the senate. The legislation passed through the House of Representatives last night. But Mr Costello admitted it would be harder to get the legislation passed in the senate. "I'm sure it will be a long period," he said. "The bill was passed by a pretty substantial majority in the House of Representatives, of course the government doesn't have a majority in the Senate, never has had, so it's going to be a tougher and torturous road. "At the end of the day the status of Telstra has to be resolved." He said the partial privatisation of Telstra would not work in the future. "If you believe that Telstra ought to be nationalised then you ought to buy all the shares back from all the mums and dads who own shares," he said. "If you believe the telephone service can be equally as well run in the private sector, then Telstra should be fully privatised. "But this situation where it is half national, half privatised isn't going to work for the long term."

From http://australianit.news.com.au/ 08/22/2003

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NEW ZEALAND: Tranz Rail Board Rejects Toll Bid

New Zealand's rail, road and ferry operator Tranz Rail yesterday rejected the $NZ200 million ($178 million) takeover bid by Australian transport group Toll Holdings, saying it was looking for a higher bidder. In a statement, the company's board said Toll's bid of NZ95c a share was not fair to Tranz Rail shareholders. The board's opinion was based on an analysis of the offer by Grant Samuel & Associates earlier this week. The chairman, Wayne Walden, said, given the offer was conditional on acceptances of 90 per cent, its success was highly uncertain. "Feedback from major shareholders indicates that this condition is unlikely to be satisfied," he said. He said the offer was below the market price and the directors were doing all they could to encourage superior offers and alternatives. Toll's managing director, Paul Little, described the board's advice as "irresponsible". Mr Little said it was nonsense to tell shareholders to turn down NZ95c a share on the off chance they could conjure up another bidder who might offer more. "The directors appear to be acting in their own self interest, with no regard to shareholders, who only a matter of months ago saw their shares fall to 40c under the direction of this same board and its management," he said. "Their advice lacks credibility and more importantly takes no account of the consequences to shareholders if the Toll bid does not go ahead." Mr Little said earlier this week that Toll would respond if another bidder made an offer, but he did not rule out pulling out of the bid and selling Toll's 20 per cent stake in Tranz Rail. "At some point, Tranz Rail would be too expensive." Mr Little said Tranz Rail's share price would "move south in a significant way" if Toll's bid failed. Tranz Rail shareholders have until August 29 to accept the Toll offer unless Toll extends the closing date. The Grant Samuel report found that Toll's offer of NZ95c a share was below the underlying value of Tranz Rail shares, taking into account deals done between Toll and the NZ Government, and Tranz Rail and the Government. Under the Toll/Government deal, the Government would spend $NZ200 million to upgrade the rail network, while Toll would invest $NZ100 million in rolling stock and have exclusive access to the network for freight. Grant Samuel said if this deal were implemented, the full underlying value of Tranz Rail shares would be $NZ1.34 to $NZ1.62, including a premium for control. Mr Little said earlier this week that the value Grant Samuel attributed to Tranz Rail was exclusive to the Toll/Government deal and might not be transferable to another party if Toll was not there. It valued the extra competitiveness that Toll might gain and did not take into account the risks associated with Tranz Rail, he said. Toll is also facing a challenge from NZ's Takeovers Panel. Toll's shares yesterday finished 7c higher at $7.34, while in Auckland Tranz Rail's shares ended 1c lower at $NZ1.01. (by Philip Hopkins)

From http://www.smh.com.au/ 07/31/2003

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Race to Buy National Bank Gets Serious

The pretenders have been weeded out of the race to buy the National Bank, and those left in the hunt are about to be unmasked. The bank, put on the market by its London owner, Lloyds TSB, has drawn the attention of all of Australia's big banks and other overseas banks such as HSBC. It is understood that the sale process has now reached a point where it has thinned out the potential buyers and left only the serious ones, who are lining up to carry out due diligence. Sources are divided about who is on the shortlist. Local market gossip is focused on ANZ, Westpac and HSBC. The Commonwealth Bank of Australia, owner of ASB, has also been tipped as a potential buyer. CBA this week increased speculation that it was preparing to buy the National Bank when it launched a debt issue that will raise up to $1 billion. But the latest word in New Zealand and Australia is that CBA has fallen out of the race. CBA has refused to comment. Sources suggest that final, binding bids for the National Bank will be due next month. Most banks would require Commerce Commission clearance to go ahead with the transaction, and applications are expected to begin arriving at the competition watchdog's office within days. A spokeswoman for the commission said yesterday that public announcements would be made when applications were received. A key component of the commission's decision will be how it chooses to define the markets in which the National Bank operates. The spokeswoman said the commission would not reveal how it intended to view the markets until it had reached its final clearance decision. A purchase of the National Bank, a leading rural and home loan lender, is likely to raise competition hurdles for Westpac - and possibly others. ANZ is so far the only bidder to have declared its hand in the process. The bank's New Zealand managing director, Greg Camm, described the National Bank as a "terrific bank", and said ANZ would be interested at the right price. "It's a really good bank and we've got great admiration for it," he said. "It has a strong brand, good people, good management and a good earnings performance." Camm said ANZ hoped to get the go-ahead to start due diligence within a fortnight. Westpac is being more coy. A local spokesman said yesterday the bank did not want to add to speculation, but was keeping an eye on the sale process. At an analysts' briefing in Australia yesterday, Westpac chief executive David Morgan said his bank did not need to acquire customers. It had made three regional banking acquisitions since 1995, and another two significant purchases last year. But he said that all significant financial asset opportunities that came up in Westpac's geographical area would be examined "in a disciplined way". (by Paula Oliver and Agencies)

From http://www.nzherald.co.nz/ 08/01/2003

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NZ Reserve Gets Power over Bank Ownership Changes

The Reserve Bank of New Zealand will have the power to veto ownership changes of more than 10 per cent at the country's banks as soon as next week. The Reserve Bank of NZ Amendment Bill, approved by Parliament this week, also changes oversight of the bank's performance and that of its governor. Governor Alan Bollard will cease to be chairman of the bank's board, whose duties include monitoring his performance. The increase in the bank's supervisory powers of NZ's 18 registered banks comes as Lloyds TSB considers selling National Bank of NZ. ANZ leads several Australian banks that have expressed interest in National Bank. NZ's five biggest banks are foreign-owned and control 90 per cent of NZ's banking assets. Under the changes, the Reserve "effectively has the ability to impose conditions" on bank mergers and acquisitions, said David Tripe, director of Massey University's centre for banking studies. At present, the central bank could withdraw a registration if the owners didn't meet a "fit and proper" test, he said. "They had some power to say yes or no. They didn't have the power to impose conditions." Mr Bollard said last month that he wouldn't want National to become a branch of an overseas bank or have its computer systems become so integrated with those of its new owners that it couldn't be run as a stand-alone business in the event of a financial crisis in NZ or Australia. Reserve officials weren't available to comment. ANZ this week asked NZ's anti-trust regulator for approval to buy National Bank, which has 22 per cent of NZ loans and 159 branches.

From http://www.smh.com.au/ 08/16/2003

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Private Beds Could Cure Crisis

Nineteen operations were cancelled because Wellington Hospital's intensive care unit was too busy, but nearby a private hospital had empty beds. Wellington Hospital's 14-bed intensive care unit has been full to overflowing for the past two weeks, forcing 19 non-urgent operations, including heart surgery, to be postponed. But nearby Wakefield Hospital has had two or three empty intensive care beds in its five-bed unit during that time, and chief executive Richard Barnes said they were willing to help out. He said it did not make sense that they had not been used by Wellington Hospital patients. Wakefield was equipped to cope with patients needing post-operative intensive care, though it was unable to cope with accident and trauma cases, Mr Barnes said. Wellington Hospital spokesman Michael Tull said this was the first time it had heard of Wakefield's offer and would be happy to discuss it for the future. The unprecedented demand for intensive care beds had eased at the weekend, and there were some empty beds last night, he said. Mr Barnes said he did not understand the Capital and Coast District Health Board's reasons for not sending patients who needed intensive care facilities to Wakefield, but said it must be ideological. It could not be for financial reasons, because he had a copy of a recent invoice from Wellington Hospital to an overseas patient, which indicated the price-per-day charged was about 50 per cent more expensive than Wakefield's. "I just feel sorry for the people in the middle - they did have an option to come here." While Wakefield did not want to do any more large-scale contracting for the Capital and Coast board, it was happy to help out when there was no extra space. "We believe that, despite the minister's claimed support for the use of private facilities to improve services provided to publicly funded patients, health boards are able to do what they like in this respect." In the past week three patients were transferred from the intensive care unit to other parts of the North Island because of the lack of beds. In addition to surgery being postponed, some patients have been denied intensive care beds - Elizabeth Murphy, 72, died last week after she was unable to get a bed. Her family and a doctor who cared for her have said that had she had the close monitoring she needed - which intensive care would have provided - she might have survived her illness.

From http://www.stuff.co.nz/ 08/25/2003

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PNG: Privatization K200 Million on Line

THE INDEPENDENT Public Business Corporation yesterday declared that it was on target to raise the K200 million forecast in the Somare Government's 2003 national budget under the privatisation program by the end of the year. IPBC managing director Masket Iangalio gave the assurance following the signing of the contract of sale for the Pacific Place building in downtown Port Moresby to a national consortium for K40.25 million. Mr Iangalio said the Pacific Place sale was the first 100 percent sale for the government on top of the K19 million partial sale of Hargy Palm Oil, bringing the total to about K60 million: "We are doing well but because we started late, the K200 million will come at the end of the year,'' he said. The Pacific Place now becomes the premium property in downtown Port Moresby. It is also the first time that major resource landowner groups in the country have joined forces to purchase a property. Mr Iangalio said 10 companies have already expressed interest in Telikom, which will go on tender by the end of this month, including companies from Australia, New Zealand, Europe, Fiji and PNG. "Again, whoever has the cash, we'll deal with them,'' he said. - The National/PINA Nius

From http://www.pacificislands.cc/ 08/07/2003

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