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business/business_1.txt

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+Lufthansa flies back to profit
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+German airline Lufthansa has returned to profit in 2004 after posting huge losses in 2003.
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+In a preliminary report, the airline announced net profits of 400m euros ($527.61m; £274.73m), compared with a loss of 984m euros in 2003. Operating profits were at 380m euros, ten times more than in 2003. Lufthansa was hit in 2003 by tough competition and a dip in demand following the Iraq war and the killer SARS virus. It was also hit by troubles at its US catering business. Last year, Lufthansa showed signs of recovery even as some European and US airlines were teetering on the brink of bankruptcy. The board of Lufthansa has recommended paying a 2004 dividend of 0.30 euros per share. In 2003, shareholders did not get a dividend. The company said that it will give all the details of its 2004 results on 23 March.

business/business_10.txt

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+Winn-Dixie files for bankruptcy
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+US supermarket group Winn-Dixie has filed for bankruptcy protection after succumbing to stiff competition in a market dominated by Wal-Mart.
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+Winn-Dixie, once among the most profitable of US grocers, said Chapter 11 protection would enable it to successfully restructure. It said its 920 stores would remain open, but analysts said it would most likely off-load a number of sites. The Jacksonville, Florida-based firm has total debts of $1.87bn (£980m). In its bankruptcy petition it listed its biggest creditor as US foods giant Kraft Foods, which it owes $15.1m.
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+Analysts say Winn-Dixie had not kept up with consumers' demands and had also been burdened by a number of stores in need of upgrading. A 10-month restructuring plan was deemed a failure, and following a larger-than-expected quarterly loss earlier this month, Winn-Dixie's slide into bankruptcy was widely expected. The company's new chief executive Peter Lynch said Winn-Dixie would use the Chapter 11 breathing space to take the necessary action to turn itself around. "This includes achieving significant cost reductions, improving the merchandising and customer service in all locations and generating a sense of excitement in the stores," he said. Yet Evan Mann, a senior bond analyst at Gimme Credit, said Mr Lynch's job would not be easy, as the bankruptcy would inevitably put off some customers. "The real big issue is what's going to happen over the next one or two quarters now that they are in bankruptcy and all their customers see this in their local newspapers," he said.

business/business_100.txt

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+US economy still growing says Fed
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+Most areas of the US saw their economy continue to expand in December and early January, the US Federal Reserve said in its latest Beige Book report.
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+Of the 12 US regions it identifies for the study, 11 showed stronger economic growth, with only the Cleveland area falling behind with a "mixed" rating. Consumer spending was higher in December than November, and festive sales were also up on 2003. The employment picture also improved, the Fed said.
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+"Labour markets firmed in a number of districts, but wage pressures generally remained modest," the Beige Book said. "Several districts reported higher prices for building materials and manufacturing inputs, but most reported steady or only slightly higher overall price levels." The report added that residential real estate activity remained strong and that commercial real estate activity strengthened in most districts. "Office leasing was especially brisk in Washington DC, and New York City, two of the nation's strongest commercial markets," the Fed said.

business/business_11.txt

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+Saab to build Cadillacs in Sweden
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+General Motors, the world's largest car maker, has confirmed that it will build a new medium-sized Cadillac BLS at its loss-making Saab factory in Sweden.
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+The car, unveiled at the Geneva motor show, is intended to compete in the medium-sized luxury car market. It will not be sold in the US, said GM Europe president Carl-Peter Forster. As part of its efforts to make the US marque appeal to European drivers, the car will be the first Cadillac with a diesel engine.
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+GM's announcement should go some way to allay fears of the Saab factory's closure. The factory in Trollhaettan has been at the centre of rumours about GM's planned severe cutbacks in its troubled European operations. But the group's new commitment to the Swedish factory may not be welcomed by the group's Opel workers in Ruesselsheim, Germany. They may now have to face a larger proportion of GM's cuts.
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+Neither will the announcement be seen as unalloyed good news in Sweden, since it reflects Saab's failure to make significant inroads into the lucrative European luxury car market. For years, Saab has consistently said it is competing head-on with BMW, Mercedes and Jaguar. The segment's leaders do not agree.
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+GM's plans to build the American marque in Sweden is part of its efforts to push it as an alternative luxury brand for European drivers. In the US, it has long been established as an upmarket brand - even the presidential limousine carries the badge. Yet it could prove tough for Cadillac to steal market share from the majors in Europe. Other luxury car makers, most notably the Toyota subsidiary Lexus, have enjoyed tremendous success in the US without managing to make significant inroads in Europe. There, German marques Mercedes Benz and BMW have retained their stranglehold on the luxury market.
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+Bringing Cadillac production to Sweden should help introduce desperately-needed scale to the Saab factory, which currently produces fewer than 130,000 cars per year. That is about half of what major car makers consider sufficient numbers for profitable operations, and Saab is losing money fast - albeit with losses halved in 2004 to $200m (£104m; 151m euros) from $500m the previous year. Beyond the 12,000 job cuts announced last year at its European operations, GM is reducing expenditure by building Saabs, Opels - badged as Vauxhalls in the UK - and now Cadillacs on the same framework, and by allowing the different brands to share parts. Another way to further reduce Saab's losses could be to shift some of the production of Saabs to the US, a market where drivers have adopted it as an upmarket European car. Doing so would remove the exposure to the weak US dollar, which is making Saabs more expensive to US consumers. But not everyone in the industry agree that it would be the best way forward. "We know that in five years the US dollar will be stronger than it is today," the chief executive of a leading European car maker told BBC News. The current trend towards US production was "stupid", he said.
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+In a separate announcement, GM unveiled a new scheme to allow European consumers the chance to test drive its Opel and Vauxhall models. It is to deploy a fleet of 35,000 test cars across 40 countries, inviting potential buyers to try out a vehicle for 24-hours. It follows a similar initiative by GM in the US. GM said it wanted to change "customers' perceptions" about Opel and Vauxhall cars, showing them that the quality had improved in recent years.

business/business_12.txt

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+Bank voted 8-1 for no rate change
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+The decision to keep interest rates on hold at 4.75% earlier this month was passed 8-1 by the Bank of England's rate-setting body, minutes have shown.
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+One member of the Bank's Monetary Policy Committee (MPC) - Paul Tucker - voted to raise rates to 5%. The news surprised some analysts who had expected the latest minutes to show another unanimous decision. Worries over growth rates and consumer spending were behind the decision to freeze rates, the minutes showed. The Bank's latest inflation report, released last week, had noted that the main reason inflation might fall was weaker consumer spending.
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+However, MPC member Paul Tucker voted for a quarter point rise in interest rates to 5%. He argued that economic growth was picking up, and that the equity, credit and housing markets had been stronger than expected.
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+The Bank's minutes said that risks to the inflation forecast were "sufficiently to the downside" to keep rates on hold at its latest meeting. However, the minutes added: "Some members noted that an increase might be warranted in due course if the economy evolved in line with the central projection". Ross Walker, UK economist at Royal Bank of Scotland, said he was surprised that a dissenting vote had been made so soon. He said the minutes appeared to be "trying to get the market to focus on the possibility of a rise in rates". "If the economy pans out as they expect then they are probably going to have to hike rates." However, he added, any rate increase is not likely to happen until later this year, with MPC members likely to look for a more sustainable pick up in consumer spending before acting.

business/business_13.txt

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+Industrial revival hope for Japan
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+Japanese industry is growing faster than expected, boosting hopes that the country's retreat back into recession is over.
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+Industrial output rose 2.1% - adjusted for the time of year - in January from a month earlier. At the same time, retail sales picked up faster than at any time since 1997. The news sent Tokyo shares to an eight-month high, as investors hoped for a recovery from the three quarters of contraction seen from April 2004 on. The Nikkei 225 index ended the day up 0.7% at 11,740.60 points, with the yen strengthening 0.7% against the dollar to 104.53 yen. Weaker exports, normally the engine for Japan's economy in the face of weak domestic demand, had helped trigger a 0.1% contraction in the final three months of last year after two previous quarters of shrinking GDP. Only an exceptionally strong performance in the early months of 2004 kept the year as a whole from showing a decline. The output figures brought a cautiously optimistic response from economic officials. "Overall I see a low risk of the economy falling into serious recession," said Bank of Japan chief Toshihiko Fukui, despite warning that other indicators - such as the growth numbers - had been worrying.
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+Within the overall industrial output figure, there were signs of a pullback from the export slowdown. Among the best-performing sectors were key overseas sales areas such as cars, chemicals and electronic goods. With US growth doing better than expected the picture for exports in early 2005 could also be one of sustained demand. Electronics were also one of the keys to the improved domestic market, with products such as flat-screen TVs in high demand during January.

business/business_14.txt

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+Khodorkovsky ally denies charges
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+A close associate of former Yukos boss Mikhail Khodorkovsky has told a court that fraud charges levelled against him are "false".
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+Platon Lebedev has been on trial alongside Mr Khodorkovsky since June in a case centring around the privatisation of a fertiliser firm. The pair claim they are being punished by the authorities for the political ambitions of Mr Khodorkovsky. Mr Lebedev said there were "absurd contradictions" in the case. Opening his defence, he said he could not see the legal basis of the charges he faced, which also include allegations of tax evasion. "To my embarrassment, I could not understand the file of complaints against me," he told a Moscow court. Mr Lebedev headed the Menatep group, the parent company of Yukos.
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+Mr Lebedev and Mr Khodorkovsky, who each face a possible 10 year jail sentence if convicted, will be questioned by a judge over the next few days. Mr Khodorkovsky began his testimony last week, telling the court that he objected to the way that the "running of a normal business has been presented as a work of criminal fiction". The charges are seen by supporters as politically motivated and part of a drive by Russian President Vladimir Putin to rein in the country's super-rich business leaders, the so-called oligarchs. Yukos has been presented with a $27.5bn (£13bn) tax demand by the Russian authorities and its key Yugansk division was auctioned off to part settle the bill. The company's effort to gain bankruptcy protection in the US - in a bid to win damages for the sale - were dismissed by a court in Texas.

business/business_15.txt

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+China keeps tight rein on credit
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+China's efforts to stop the economy from overheating by clamping down on credit will continue into 2005, state media report.
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+The curbs were introduced earlier this year to ward off the risk that rapid expansion might lead to soaring prices. There were also fears that too much stress might be placed on the fragile banking system. Growth in China remains at a breakneck 9.1%, and corporate investment is growing at more than 25% a year. The breakneck pace of economic expansion has kept growth above 9% for more than a year. Rapid tooling-up of China's manufacturing sector means a massive demand for energy - one of the factors which has kept world oil prices sky-high for most of this year. In theory, the government has a 7% growth target, but continues to insist that the overshoot does not mean a "hard landing" in the shape of an overbalancing economy. A low exchange rate - China's yuan is pegged to a rate of 8.28 to the dollar, which seems to be in relentless decline - means Chinese exports are cheap on world markets. China has thus far resisted international pressure to break the link or at least to shift the level of its peg. To some extent, the credit controls do seem to be taking effect. Industrial output grew 15.7% in the year to October, down from 23% in February, and inflation slowed to 4.3% - although retail sales are still booming.

business/business_16.txt

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+Verizon 'seals takeover of MCI'
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+Verizon has won a takeover battle for US phone firm MCI with a bid worth $6.8bn (£3.6bn), reports say.
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+The two firms are expected to seal the deal on Monday morning, according to news agency reports, despite what was thought to be a higher bid from Qwest. The US telecoms market is consolidating fast, with former long-distance giant AT&T being bought by former subsidiary SBC earlier this year for $16bn. MCI exited bankruptcy in April, having gone bust under previous name WorldCom. The bankruptcy followed its admission in 2002 that it illegally booked expenses and inflated profits.
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+Shareholders lost about $180bn when the company collapsed, while 20,000 workers lost their jobs. Former Worldcom boss Bernie Ebbers is currently on trial, accused of overseeing an $11bn fraud. Qwest has itself come under suspicion of sub-standard behaviour, paying the Securities and Exchange Commission $250m in October to settle charges that it manipulated its results to keep Wall Street happy.
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+MCI is the US's second-biggest long distance firm after AT&T. Consolidation in the US telecommunications industry has picked up in the past few months as companies look to cut costs and boost client bases. A merger between MCI and Verizon would be the fifth billion-dollar telecoms deal since October. Last week, SBC Communications agreed to buy its former parent and phone trailblazer AT&T for about $16bn. Buying MCI would give either Qwest or Verizon access to MCI's global network and business-based subscribers. The rationale is similar to the one underpinning SBC's AT&T deal. Verizon is by far the bigger company and has its own successful mobile arm - factors which may have swung the board in its favour since both suitors are offering a mixture of cash and shares.

business/business_17.txt

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+Crossrail link 'to get go-ahead'
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+The £10bn Crossrail transport plan, backed by business groups, is to get the go-ahead this month, according to The Mail on Sunday.
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+It says the UK Treasury has allocated £7.5bn ($13.99bn) for the project and that talks with business groups on raising the rest will begin shortly. The much delayed Crossrail Link Bill would provide for a fast cross-London rail link. The paper says it will go before the House of Commons on 23 February.
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+A second reading could follow on 16 or 17 March. "We've always said we are going to introduce a hybrid Bill for Crossrail in the Spring and this remains the case," the Department for Transport said on Sunday. Jeremy de Souza, a spokesman for Crossrail, said on Sunday he could not confirm whether the Treasury was planning to invest £7.5bn or when the bill would go before Parliament.
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+However, he said some impetus may have been provided by the proximity of an election.
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+The new line would go out as far as Maidenhead, Berkshire, to the west of London, and link Heathrow to Canary Wharf via the City. Heathrow to the City would take 40 minutes, dramatically cutting journey times for business travellers, and reducing overcrowding on the tube. The line has the support of the Mayor of London, Ken Livingstone, business groups and the government, but there have been three years of arguments over how it should be funded. The Mail on Sunday's Financial Mail said the £7.5bn of Treasury money was earmarked for spending in £2.5bn instalments in 2010, 2011 and 2012.

business/business_18.txt

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+Small firms 'hit by rising costs'
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+Rising fuel and materials costs are hitting confidence among the UK's small manufacturers despite a rise in output, business lobby group the CBI says.
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+A CBI quarterly survey found output had risen by the fastest rate in seven years but many firms were seeing the benefits offset by increasing expenses. The CBI also found spending on innovation, training and retraining is forecast to go up over the next year. However, firms continue to scale back investment in buildings and machinery.
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+The CBI said companies are looking to the government to lessen the regulatory load and are hoping interest rates will be kept on hold. "Smaller manufacturers are facing an uphill struggle," said Hugh Morgan Williams, chair of the CBI's SME Council. "The manufacturing sector needs a period of long-term stability in the economy." The CBI found some firms managed to increase prices for the first time in nine years - but many said increases failed to keep up the rise in costs. Of the companies surveyed, 30% saw orders rise and 27% saw them fall. The positive balance of plus 3 compared with minus 10 in the previous survey. When firms were questioned on output volume, the survey returned a balance of plus 8 - the highest rate of increase for seven years - and rose to plus 11 when looking ahead to the next three months.

business/business_19.txt

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+Deutsche Boerse boosts dividend
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+Deutsche Boerse, the German stock exchange that is trying to buy its London rival, has said it will boost its 2004 dividend payment by 27%.
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+Analysts said that the move is aimed at winning over investors opposed to its bid for the London Stock Exchange. Critics of the takeover have complained that the money could be better used by returning cash to shareholders. Deutsche Boerse also said profit in the three months to 31 December was 120.7m euros ($158.8m; £83.3m). Sales climbed to 364.4m euros, lifting revenue for the year to a record 1.45bn euros.
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+Frankfurt-based Deutsche Boerse has offered £1.3bn ($2.48bn; 1.88bn euros) for the London Stock Exchange. Rival pan-European bourse Euronext is working also on a bid. Late on Monday, Deutsche Boerse said it would lift its 2004 dividend payment to 70 euro cents (£0.48; $0.98) from 55 euro cents a year earlier. "There is a whiff of a sweetener in there," Anais Faraj, an analyst at Nomura told the BBC's World Business Report. "Most of the disgruntled shareholders of Deutsche Boerse are complaining that the money that is being used for the bid could be better placed in their hands, paid out in dividends," Mr Faraj continued. Deutsche Boerse is "trying to buy them off in a sense", he said.

business/business_2.txt

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+Japanese growth grinds to a halt
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+Growth in Japan evaporated in the three months to September, sparking renewed concern about an economy not long out of a decade-long trough.
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+Output in the period grew just 0.1%, an annual rate of 0.3%. Exports - the usual engine of recovery - faltered, while domestic demand stayed subdued and corporate investment also fell short. The growth falls well short of expectations, but does mark a sixth straight quarter of expansion.
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+The economy had stagnated throughout the 1990s, experiencing only brief spurts of expansion amid long periods in the doldrums. One result was deflation - prices falling rather than rising - which made Japanese shoppers cautious and kept them from spending.
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+The effect was to leave the economy more dependent than ever on exports for its recent recovery. But high oil prices have knocked 0.2% off the growth rate, while the falling dollar means products shipped to the US are becoming relatively more expensive.
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+The performance for the third quarter marks a sharp downturn from earlier in the year. The first quarter showed annual growth of 6.3%, with the second showing 1.1%, and economists had been predicting as much as 2% this time around. "Exports slowed while capital spending became weaker," said Hiromichi Shirakawa, chief economist at UBS Securities in Tokyo. "Personal consumption looks good, but it was mainly due to temporary factors such as the Olympics. "The amber light is flashing." The government may now find it more difficult to raise taxes, a policy it will have to implement when the economy picks up to help deal with Japan's massive public debt.

business/business_20.txt

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+Brewers' profits lose their fizz
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+Heineken and Carlsberg, two of the world's largest brewers, have reported falling profits after beer sales in western Europe fell flat.
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+Dutch firm Heineken saw its annual profits drop 33% and warned that earnings in 2005 may also slide. Danish brewer Carlsberg suffered a 3% fall in profits due to waning demand and increased marketing costs. Both are looking to Russia and China to provide future growth as western European markets are largely mature.
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+Heineken's net income fell to 537m euros ($701m; £371m) during 2004, from 798m euro a year ago. It blamed weak demand in western Europe and currency losses. It had warned in September that the weakening US dollar, which has cut the value of foreign sales, would knock 125m euros off its operating profits. Despite the dip in profits, Heineken's sales have been improving and total revenue for the year was 10bn euros, up 8.1% from 9.26bn euros in 2003. Heineken said it now plans to invest 100m euros in "aggressive" and "high-impact" marketing in Europe and the US in 2005. Heineken, which also owns the Amstel and Murphy's stout brands, said it would also seek to cut costs. This may involve closing down breweries.
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+Heineken increased its dividend payment by 25% to 40 euro cents, but warned that the continued impact of a weaker dollar and an increased marketing spend may lead to a drop in 2005 net profit.
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+Carlsberg, the world's fifth-largest brewer, saw annual pre-tax profits fall to 3.4bn Danish kroner (456m euros). Its beer sales have been affected by the sluggish European economy and by the banning of smoking in pubs in several European countries. Nevertheless, total sales increased 4% to 36bn kroner, thanks to strong sales of Carlsberg lager in Russia and Poland. Carlsberg is more optimistic than Heineken about 2005, projecting a 15% rise in net profits for the year. However, it also plans to cut 200 jobs in Sweden, where sales have been hit by demand for cheap, imported brands. "We remain cautious about the medium-to-long term outlook for revenue growth across western Europe for a host of economic, social and structural reasons," investment bank Merrill Lynch said of Carlsberg.

business/business_21.txt

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+Russia WTO talks 'make progress'
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+Talks on Russia's proposed membership of the World Trade Organisation (WTO) have been "making good progress" say those behind the negotiations.
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+But the chairman of the working party, Ambassador Stefan Johannesson of Iceland, warned that there was "still a lot of work has to be done". His comments came as President George W Bush said the US backed Russian entry. But he said for Russia to make progress the government must "renew a commitment to democracy and the rule of law". His comments come three days before he is due to meet President Vladimir Putin.
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+Russia has been waiting for a decade to join the WTO and hopes to finally become a member by early 2006. A decision could be reached in December, when the WTO's 148 current members gather for a summit in Hong Kong. That would allow an earliest date for membership of January 2006, if the Hong Kong summit gave its approval. While pinpointing several areas in which there are difficulties in the bilateral and multilateral work with Russia, the US said the meeting was "much more efficient than we've seen for some time". And Australia said it was "one of the best (meetings) we can recall in terms of substance". Mr Johannesson also said progress "on the bilateral market access side is accelerating". Sticking points to membership have included limits on foreign ownership in the telecommunications and life insurance businesses, as well as issues surrounding counterfeiting, piracy, and data protection. Some WTO members also dislike Russia's energy price subsidies, which competitors say give Russian businesses an unfair advantage.

business/business_22.txt

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+India's rupee hits five-year high
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+India's rupee has hit a five-year high after Standard & Poor's (S&P) raised the country's foreign currency rating.
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+The rupee climbed to 43.305 per US dollar on Thursday, up from a close of 43.41. The currency has gained almost 1% in the past three sessions. S&P, which rates borrowers' creditworthiness, lifted India's rating by one notch to 'BB+'. With Indian assets now seen as less of a gamble, more cash is expected to flow into its markets, buoying the rupee.
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+"The upgrade is positive and basically people will use it as an excuse to come back to India," said Bhanu Baweja, a strategist at UBS. "Money has moved out from India in the first two or three weeks of January into other markets like Korea and Thailand and this upgrade should lead to a reversal." India's foreign currency rating is now one notch below investment grade, which starts at 'BBB-'. The increase has put it on the same level as Romania, Egypt and El Salvador, and one level below Russia.

business/business_23.txt

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+Dollar drops on reserves concerns
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+The US dollar has dropped against major currencies on concerns that central banks may cut the amount of dollars they hold in their foreign reserves.
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+Comments by South Korea's central bank at the end of last week have sparked the recent round of dollar declines. South Korea, which has about $200bn in foreign reserves, said it plans instead to boost holdings of currencies such as the Australian and Canadian dollar. Analysts reckon that other nations may follow suit and now ditch the dollar. At 1300 GMT, the euro was up 0.9% on the day at 1.3187 euros per US dollar. The British pound had added 0.5% to break through the $1.90 level, while the dollar had fallen by 1.3% against the Japanese yen to trade at 104.16 yen.
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+At the start of the year, the US currency, which had lost 7% against the euro in the final three months of 2004 and had fallen to record lows, staged something of a recovery.
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+Analysts, however, pointed to the dollar's inability recently to extend that rally despite positive economic and corporate data, and highlighted the fact that many of the US's economic problems had not disappeared. The focus once again has been on the country's massive trade and budget deficits, with predictions of more dollar weakness to come. "The comments from Korea came at a time when sentiment towards the dollar was already softening," said Ian Gunner, a trader at Mellon Financial. On Tuesday, traders in Asia said that both South Korea and Taiwan had withdrawn their bids to buy dollars at the start of the session. Mansoor Mohi-Uddin, chief currency strategist at UBS, said that there was a sentiment in the market that "central banks from Asia and the Middle East are buying euros". A report last month already showed that the dollar was losing its allure as a currency that offered rock-steady returns and stability. Compiled by Central Banking Publications and sponsored by the UK's Royal Bank of Scotland, the survey found 39 nations out of 65 questioned were increasing their euro holdings, with 29 cutting back on the US dollar.

business/business_24.txt

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+India and Russia in energy talks
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+India and Russia are to work together in a series of energy deals, part of a pact which could see India invest up to $20bn in oil and gas projects.
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+On the agenda are oil and gas extraction as well as transportation deals, to be led by Russian energy giant Gazprom and India's ONGC. The Indian firm is also expected to hold talks on Tuesday about buying a stake in assets once owned by Yukos. It is reported to be keen on buying a 15% stake in oil unit Yuganskneftegas. The former Yukos subsidiary was controversially sold off last year and eventually acquired by state-owned energy giant Rosneft.
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+Russian media reported that India and Russia signed a memorandum of understanding on energy co-operation on Tuesday during a meeting between Oil and Natural Gas Corporation chairman Subir Raha, Gazprom chairman Aleksey Miller and India's petroleum minister Mani Shankar Aiyar.
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+The agreement is likely to see the two companies develop refining facilities in Russia, India and elsewhere and organise delivery of oil, gas and petrochemicals from Russia to India and other countries across Asia. ONGC could invest in gas and oil fields in Sakhalin, in the far east of Russia, and may also take part in joint tender bids for projects in eastern Siberia and the Caspian Sea.
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+India is urgently searching for fresh energy supplies - particularly liquefied natural gas - as domestic demand is growing at more than 5% a year.
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+ONGC's Mr Raha said the two could work together on joint bids from next year. "At current oil and gas prices, our cash flow situation is good," he told Reuters. "What we are saying is - Gazprom has a huge amount of gas and we have the money. "The investment may go up to $20bn or more for a period of five years or so."
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+Russian news agencies reported that India's petroleum minister Mr Aiyar and Russian energy minister Viktor Khristenko would discuss the future of Yugansk at a meeting on Tuesday. ONGC's Mr Raha declined to be drawn on his firm's reported interest in the company. However, he stressed that ONGC was not interested in a 'loan-for-oil deal' in connection to Yugansk, similar to that concluded recently between Rosneft and China's National Petroleum Corporation. "China's problem is it has immediate demand and they needed the oil for their coastal refineries. We do not. We would like long-term security through equity participation." It is thought that any decision over Yugansk will be delayed until a US court has decided whether to grant Yukos bankruptcy protection. Yukos is suing a host of companies involved in the sale of Yugansk, auctioned off to pay a huge back-tax bill. It has also threatened legal action against any business which has future commercial dealings with its former subsidiary.

business/business_25.txt

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+Weak data buffets French economy
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+A batch of downbeat government data has cast doubt over the French economy's future prospects.
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+Official figures showed on Friday that unemployment was unchanged at 9.9% last month, while consumer confidence fell unexpectedly in October. At the same time, finance minister Nicolas Sarkozy warned that high oil prices posed a threat to French growth. "[Oil prices] will weigh on consumer spending in the short term, and potentially on confidence," he said. World oil prices have risen by more than 60% since the start of the year as production struggles to keep pace with soaring demand.
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+Analysts said French companies, keen to protect their profit margins at a time of rising energy costs, were reluctant to take on extra staff. "[The unemployment figures] show the main problem of the French economy: we have growth but without an improvement in employment," said Marc Touati, an economist at Natexis Banques Populaires. "Politicians must have the will and guts to solve structural unemployment with thorough reforms, otherwise in five or ten years, it will be too late." Obligatory employer contributions to worker welfare programmes mean that it costs more to hire staff in France than in many other European economies. Many economists have urged the government to stimulate employment by reducing non-wage payroll costs, and by scrapping restrictions on working hours. The French statistics agency, INSEE, expects the economy to grow by about 2.4% this year, buoyed by strong consumer spending and business investment. That is above the projected eurozone average of just above 2%.

business/business_26.txt

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+Business fears over sluggish EU economy
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+As European leaders gather in Rome on Friday to sign the new EU constitution, many companies will be focusing on matters much closer to home - namely how to stay in business.
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+Lille is a popular tourist destination for Britons who want a taste of France at the weekend. But how many tourists look at the impressively grand Victorian Chambre de Commerce, which stands beside the Opera House, and consider that it was built - like the town halls in many northern English towns - on the wealth created by coal, steel and textiles? Like northern England and industrial Scotland, those industries have been in long term decline - the last coal pit closed in 1990. Beck-Crespel is a specialist steel firm in Armentieres, about 20 miles from Lille. The company has not laid off a worker since 1945. It specialises in making bolts and fixings for power stations and the oil industry, but not many of those are being built in Europe these days.
+
+Director Hugues Charbonnier says he is under pressure because factories in the Far East are able to make some of his output more cheaply, while his key markets are now in China and India. "In our business the market is absolutely global, you can not imagine living with our size (of business) even within an enlarged European Union, (if we did that) we would need not 350 people but perhaps just 150 or 200," he says. It isn't just globalisation that is hurting; the law in France means workers are paid for a 39 hour week even though they work just 35 hours. But at least there is still a steel industry. Coal has now totally vanished and textiles are struggling. New business has been attracted, but not enough to make up the difference.
+
+That is one reason why people here are not great fans of the EU, says Frederic Sawicki, a politics lecturer at the University of Lille.
+
+"In the region today the unemployment rate is 12%, in some areas it is 15%. They don't see what Europe is doing for them, so there is a kind of euro scepticism, especially in the working classes," he says. Which is strange because Lille is at the crossroads of Europe - if anywhere should be benefiting from the euro it is here. The euro was designed to increase trade within the eurozone, but the biggest increase in trade has been with the rest of the world. Much of that trade passes through the world's largest port, Rotterdam, in Holland, home to specialist crane maker Huisman Itrec. Its cranes help build oil rigs and lifted the sunken Russian submarine Kursk from the sea bed, but Huisman Itrec is now setting up a factory in China, where costs are cheaper and its main customers are closer.
+
+Boss Henk Addink blames the low growth rate in Europe for the lack of orders closer to home. "In the US growth is something like 6%, in China they are estimating 15%, and in the EU it is more or less 1%," he says. Mr Addink blames the euro for stifling demand. He much preferred the old currencies of Europe, which moved in relation to each country's economic performance. In Germany, industry is exporting more these days, but the economy as a whole is once again mired in slow growth and high unemployment. Growth is likely to peak this year at just under 2%. In Britain that would be a bad year; in Germany it is one of the best in recent years. With Germany making up a third of the eurozone's economy, this is a major problem. If Germany doesn't once again become the powerhouse of Europe, growth across the bloc is never going to be as strong as it could be. However, at one factory near the Dutch border things are changing.
+
+The Siemens plant at Boscholt makes cordless phones and employs 2,000 staff. Staff have started working an extra four hours a week for no extra pay, after Siemens threatened to take the factory and their jobs to Hungary. Factory manager Herbert Stueker says that he now hopes to increase productivity "by nearly 30%". But Germany needs much more reform if all its industry is to compete with places such Hungary or China. The Government is reforming the labour market and cutting the generous unemployment system, but the real solution is to cut the wages of low skilled workers, says Helmut Schneider, director of the Institute for the Study of Labour at Bonn University. "Labour is too costly in Germany, especially for the low skilled labour and this is the main problem. If we could solve that problem we could cut unemployment by half," he says. The EU set itself the target of being the most efficient economy in the world by 2010. Four years into that process, and the target seems further away than ever.

business/business_27.txt

@@ -0,0 +1,9 @@
+M&S cuts prices by average of 24%
+
+Marks & Spencer has cut prices in London and the regions by an average of 24%, according to research from a City investment bank.
+
+Dresdner Kleinwort Wasserstein said: "In spite of the snow in the UK, it still feels very early to be cutting prices of spring merchandise." Stuart Rose, head of M&S, said last year its prices were too high. "We are bringing in ranges at new price points to compete against mid-market retailers like Next," said M&S.
+
+Next is one of M&S's biggest competitors and the move may force it to lower prices. DrKW said the cuts are either to clear stock or could indicate a longer term "step change in pricing in certain areas" at M&S. "Either way, this cannot be good news for M&S' margin," it added. "We have brought in quite a lot of new clothing at new price points as part of Stuart Rose's strategy of quality, style -and price," said the M&S spokesman. Many analysts believe February is proving to be a difficult month for retailers and British Retail Consortium figures, due in a few weeks, are expected to reflect the tough trading environment. Separately, investment bank Goldman Sachs produced reseach showing that a basket of 35 M&S goods is now 11% above the high-street average, compared with 43% higher last year.
+
+It has been a strange week for M&S, which on Tuesday received a statement from Philip Green, the billionaire Bhs owner, confirming he was not rebidding for the company. This was followed the same day by Mark Paulsmeier, a South African financier, issuing a press release saying his Paulsmeier Group was interested in M&S. A sudden spike in M&S's share price followed. However, an M&S spokesman said on Sunday it had no evidence that Mr Paulsmeier had lined up sufficient finance for a bid. He also said the Takeover Panel and the UK's financial watchdog the Financial Services Authority had been in touch with M&S at the beginning of the week to find out what it knew about the Paulsmeier developments.

business/business_28.txt

@@ -0,0 +1,11 @@
+Fiat chief takes steering wheel
+
+The chief executive of the Fiat conglomerate has taken day-to-day control of its struggling car business in an effort to turn it around.
+
+Sergio Marchionne has replaced Herbert Demel as chief executive of Fiat Auto, with Mr Demel leaving the company. Mr Marchionne becomes the fourth head of the business - which is expected to make a 800m euro ($1bn) loss in 2004 - in as many years. Fiat underperformed the market in Europe last year, seeing flat sales.
+
+The car business has made an operating loss in five of the last six years and was forced to push back its break-even target from 2005 to 2006. The management changes are part of a wider shake-up of the business following Fiat's resolution of its dispute with General Motors. As part of a major restructuring, Fiat is to integrate the Maserati car company - currently owned by Ferrari - within its own operations. Ferrari, in which Fiat owns a majority stake, could be separately floated on the stock market in either 2006 or 2007.
+
+Mr Marchionne, who only joined the company last year, said Fiat Auto was now the "principal focus" of his attention. "I have made the decision to take on the post of chief executive of the auto unit to speed up the company's recovery," he said. "A profound cultural transformation is underway following a management reorganisation that has delivered a more agile and efficient structure," he added.
+
+Although Mr Marchionne does not have a background in the car industry, he has been playing an increasing role in the group's activities. Last year, he said that a series of new models, launched as part of the group's recovery plan, had not boosted revenues as much as hoped. The car business, best known for its Alfa Romeo marque, is expected to make a loss of about 800m euros in 2004. Sales are expected to fall in 2005, Fiat said this week, as it exits unprofitable areas such as the rental car market. Mr Demel, a car industry veteran, took the helm in November 2003 after being recruited by former Fiat chief executive Giuseppe Morchio. Mr Morchio made a bid last year to become chairman after the death of president Umberto Agnelli. However, this was rejected by the founding Agnelli family and Mr Morchio subsequently resigned. Earlier this week, Fiat reached an agreement with GM to dissolve an alliance which could have obliged GM to buy the Italian firm outright. GM will pay Fiat $2bn as part of the settlement.

business/business_29.txt

@@ -0,0 +1,13 @@
+UK 'risks breaking golden rule'
+
+The UK government will have to raise taxes or rein in spending if it wants to avoid breaking its "golden rule", a report suggests.
+
+The rule states that the government can borrow cash only to invest, and not to finance its spending projects. The National Institute of Economic and Social Research (NIESR) claims that taxes need to rise by about £10bn if state finances are to be put in order. The Treasury said its plans were on track and funded until 2008. According to NIESR, if the government's current economic cycle runs until March 2006 then it is "unlikely" the golden rule will be met. Should the cycle end a year earlier, then the chances improve to "50/50". Either way, fiscal tightening is needed, NIESR said.
+
+The report is the latest to call into question the viability of government spending projections. Earlier this month, accountancy firm Ernst & Young said that Chancellor of the Exchequer Gordon Brown's forecasts for tax revenues were too optimistic.
+
+It claimed revenues were likely to be £6bn below estimates by the end of the tax year despite the economy growing in line with forecasts. A Treasury spokesperson dismissed the latest claims, saying it was "on track to meeting spending rules and the golden rule in the current cycle and beyond". "Spending plans have been set out until 2008 and they are fully affordable." Other than its warning on possible tax hikes, the NIESR report was optimistic about the state of the UK and global economy.
+
+It said the recent record-busting surge in oil prices would have a limited effect on worldwide expansion, saying that if anything the "world economy will continue to grow strongly". Global gross domestic product (GDP) is tipped to be 4.1% this year, dipping to 4% in 2005, before picking up again to 4.2% in 2006. The US will continue to drive expansion until 2006, albeit at a slightly slower rate, as will be the case in Japan. Hinting at better times for UK exporters, NIESR said the euro zone "is expected to pick up speed".
+
+Growth in Britain also is set to accelerate, it forecast. "Despite weak growth in the third quarter, the forces sustaining the upswing remain intact and the economy will expand robustly in 2005 and 2006," NIESR said, adding that "the economy will become better balanced over the next two years as exports stage a recovery". GDP is expected at 3.2% in 2004, and 2.8% in both 2005 and 2006. The main cloud on the horizon, NIESR said, was the UK's much analysed and fretted over property market.

business/business_3.txt

@@ -0,0 +1,11 @@
+WorldCom director admits lying
+
+The former chief financial officer at US telecoms firm WorldCom has admitted before a New York court that he used to lie to fellow board members.
+
+Speaking at the trial of his former boss Bernard Ebbers, Scott Sullivan said he lied to the board to cover up the hole in WorldCom's finances. Mr Ebbers is on trial for fraud and conspiracy in relation to WorldCom's collapse in 2002. He pleads not guilty. The firm had been overstating its accounts by $11bn (£8.5bn). Mr Sullivan, 42, has already pleaded guilty to fraud and will be sentenced following Mr Ebbers' trial, where he is appearing as a prosecution witness. Mr Ebbers, 63, has always insisted that he was unaware of any hidden shortfalls in WorldCom's finances.
+
+In the New York court on Wednesday, Mr Ebbers' lawyer Reid Weingarten asked Mr Sullivan: "If you believe something is in your interest, you are willing and able to lie to accomplish it, isn't that right?"
+
+"On that date, yes. I was lying," replied Mr Sullivan. Mr Weingarten has suggested that Mr Sullivan is implicating Mr Ebbers only to win a lighter sentence, something Mr Sullivan denies. Mr Sullivan also rejects a suggestion that he had once told fellow WorldCom board member Bert Roberts that Mr Ebbers was unaware of the accounting fraud at WorldCom. The trial of Mr Ebbers is now into its third week.
+
+Under 23 hours of questioning from a federal prosecutor, Mr Sullivan has previously told the court that he repeatedly warned Mr Ebbers that falsifying the books would be the only way to meet Wall Street revenue and earnings expectations. Mr Sullivan claims that Mr Ebbers refused to stop the fraud. Mr Ebbers could face a sentence of 85 years if convicted of all the charges he is facing. WorldCom's problems appear to have begun with the collapse of the dotcom boom which cut its business from internet companies. Prosecutors allege that the company's top executives responded by orchestrating massive fraud over a two-year period. WorldCom emerged from bankruptcy protection in 2004, and is now known as MCI.

business/business_30.txt

@@ -0,0 +1,17 @@
+Call centre users 'lose patience'
+
+Customers trying to get through to call centres are getting impatient and quicker to hang up, a survey suggests.
+
+Once past the welcome message, callers on average hang up after just 65 seconds of listening to canned music. The drop in patience comes as the number of calls to call centres is growing at a rate of 20% every year. "Customers are getting used to the idea of an 'always available' society," says Cara Diemont of IT firm Dimension Data, which commissioned the survey. However, call centres also saw a sharp increase of customers simply abandoning calls, she says, from just over 5% in 2003 to a record 13.3% during last year. When automated phone message systems are taken out of the equation, where customers have to pick their way through multiple options and messages, the number of abandoned calls is even higher - a sixth of all callers give up rather than wait. One possible reason for the lack in patience, Ms Diemont says, is the fact that more customers are calling 'on the move' using their mobile phones.
+
+The surge in customers trying to get through to call centres is also a reflection of the centres' growing range of tasks. "Once a call centre may have looked after mortgages, now its agents may also be responsible for credit cards, insurance and current accounts," Ms Diemont says. Problems are occurring because increased responsibility is not going hand-in-hand with more training, the survey found.
+
+In what Dimension Data calls an "alarming development", the average induction time for a call centre worker fell last year from 36 to just 21 days, leaving "agents not equipped to deal with customers". This, Ms Diemont warns, is "scary" and not good for the bottom line either. Poor training frustrates both call centre workers and customers. As a result, call centres have a high "churn rate", with nearly a quarter of workers throwing in the towel every year, which in turn forces companies to pay for training new staff. Resolution rates - the number of calls where a customer's query is resolved to mutual satisfaction - are running at just 50%. When the query is passed on to a second or third person - a specialist or manager - rates rise to about 70%, but that is still well below the industry target of an 85% resolution rate.
+
+Suggestions that "outsourcing" - relocating call centres to low-cost countries like India or South Africa - is to blame are wrong, Ms Diemont says.
+
+There are "no big differences in wait time and call resolution" between call centres based in Europe or North America and those in developing countries around the world. "You can make call centres perform anywhere if you have good management and the right processes in place," she says. However, companies that decide to "offshore" their operations are driven not just by cost considerations. Only 42% of them say that saving money is the main consideration when closing domestic call centre operations. Half of them argue that workers in other countries offer better skills for the money. But not everybody believes that outsourcing and offshoring are the solution. Nearly two-thirds of all firms polled for the survey have no plans to offshore their call centres. They give three key reasons for not making the move:
+
+- call centre operations are part of their business "core function", 
+ - they are worried about the risk of going abroad, 
+ - they fear that they will damage their brand if they join the offshoring drive. The survey was conducted by Sunovate on behalf of Dimension Data, and is based on in-depth questionnaires of 166 call centres in 24 countries and five continents. What are your experiences with call centres? Are you happy to listen to Vivaldi or Greensleeves, or do you want an immediate response? And if you work in a call centre: did your training prepare you for your job?

business/business_31.txt

@@ -0,0 +1,11 @@
+Novartis hits acquisition trail
+
+Swiss drugmaker Novartis has announced 5.65bn euros ($7.4bn; £3.9bn) of purchases to make its Sandoz unit the world's biggest generic drug producer.
+
+Novartis, which last month forecast record sales for 2005, said it had bought all of Germany's Hexal. It also acquired 67.7% of Hexal's US affiliate Eon Labs, and offered to buy the remaining shares for $31 each. Novartis said that it would be able to make cost savings of about $200m a year following the acquisitions. Novartis' shares rose 1% to 57.85 Swiss francs in early trading.
+
+The deal will see Novartis' Sandoz business overtake Israel's Teva Pharmaceuticals as the world's biggest maker of generics. Based on 2004 figures the newly merged producer would have sales of more than $5bn, the company estimated. Novartis said that it would merge a number of departments, adding that there may be job cuts.
+
+"The strong growth outlook for Sandoz, which will create jobs, is expected to partially compensate for necessary reductions in the work force," the firm said in a statement. Generic drugs are chemically identical to their more expensive branded rivals. Producers such as Sandoz can copy the branded products usually after their patent protection expires and can sell them more cheaply as they do not have to pay research and development cost.
+
+There are more than 150 generic drugmakers worldwide and analysts have predicted consolidation in a market that they call fragmented. However, not all analysts were initially convinced about the deal. "This is a very expensive acquisition," Birgit Kuhlhoff, from Sal Oppenheim investment bank, told Reuters. "I find it strange that they are making acquisitions in exactly those markets where they suffered price pressure."

business/business_32.txt

@@ -0,0 +1,7 @@
+Economy 'strong' in election year
+
+UK businesses are set to prosper during the next few months - but this could trigger more interest rate rises, according to a report.
+
+Optimism is at its highest since 1997 and business will reap the benefits of a continuing rise in public spending, say researchers at BDO Stoy Hayward. The Bank of England is expected to keep rates on hold this week - but they could go up later in the year. Rates are likely to rise after the anticipated general election in May. The BDO optimism index - a leading indicator of GDP growth two quarters ahead edged up in January to 102.5, from 102.2 in October. The rise is due, in part, to an increase in public spending and increased merger and acquisition activity.
+
+The only thing blighting business optimism this year will be uncertainties associated with the general election, BDO said. Its BDO's output index - which predicts GDP movements a quarter in advance - remained at 100.8 for January, implying GDP growth at 2.9% in the second quarter of 2005. However, the output index is being held back by recent interest rate rises, sterling's strength against the dollar and high oil prices, the group noted. Its inflation index, which has risen continuously over the last 8 months, climbed to 110.0 in January from 108.0 in October last year. "The UK is looking strong going into the general election, but businesses need to prepare themselves for a jolt ahead as the Bank of England reacts to growth and inflationary pressures," said Peter Hemington, partner at BDO Stoy Hayward. "Growth will probably slow by the end of 2005 and it is likely that we will see higher interest rates or a sharp drop in demand for products and services."

business/business_33.txt

@@ -0,0 +1,7 @@
+Sluggish economy hits German jobs
+
+The number of people out of work in Europe's largest economy has risen for the tenth straight month as growth remains stubbornly slow.
+
+German unemployment rose 7,000 in November to 4.464 million people, or 10.8% of the workforce. The seasonally adjusted rise showed a smaller rise than expected, as government measures to encourage job creation began to take effect. But officials said stagnant growth was still stifling the job market. "There are clear signs of a revival in domestic demand," said Frank-Juergen Weise, head of the Federal Labour Agency, in a statement. "But growth of 0.1%... in the third quarter is still insufficient to deliver positive momentum to the labour market." High oil prices and the soaring euro - which damages the competitiveness of exporters - were also having a negative effect, he said. The brunt of the unemployment is still being felt in the eastern part of Germany, where the rate is 18.8%.
+
+With unemployment stuck above 4 million for years, the government of Chancellor Gerhard Schroeder has put job creation at the top of the agenda. A controversial package of measures to shake up incentives to get back to work, paid for by cutting some cherished benefits, has sparked anger among some German workers. Strikes in a number of industries, notably among the country's iconic carmakers, have demonstrated the displeasure - as well as fears about further job losses as outsourcing takes hold. Among the new initiatives are the so-called "one-euro jobs" which top up unemployment benefit. The scheme's formal launch is January, but hirings for these positions are already taking place and affecting the unemployment statistics, economists said. "The deterioration of the labour market does not come as a surprise," said Isabelle Kronawitter at Hypovereinsbank. "Job creation measures probably prevented a stronger increase in the seasonally adjusted numbers."

business/business_34.txt

@@ -0,0 +1,7 @@
+Sales 'fail to boost High Street'
+
+The January sales have failed to help the UK High Street recover from a poor Christmas season, a survey has found.
+
+Stores received a boost from bargain hunters but trading then reverted to December levels, the British Retail Consortium and accountants KPMG said. Sales in what is traditionally a strong month rose by 0.5% on a like-for-like basis, compared with a year earlier. Consumers remain cautious over buying big-ticket items like furniture, said BRC director general Kevin Hawkins. Higher interest rates and uncertainty over the housing market continue to take their toll on the retail sector, the BRC said. But clothing and footwear sales were said to be generally better than December, while department stores also had a good month.
+
+In the three-months to January, like-for-like sales showed a growth rate of -0.1%, the same as in the three months to December, the BRC said. "Following a relatively strong New Year's bank holiday, trading then took a downward turn," said Mr Hawkins. "Even extending some promotions and discounts and the pay-day boost later in the month could not tempt customers." The previous BRC survey found Christmas 2004 was the worst for 10 years for retailers. And according to Office for National Statistics data, sales in December failed to meet expectations and by some counts were the worst since 1981.

business/business_35.txt

@@ -0,0 +1,7 @@
+Call to save manufacturing jobs
+
+The Trades Union Congress (TUC) is calling on the government to stem job losses in manufacturing firms by reviewing the help it gives companies.
+
+The TUC said in its submission before the Budget that action is needed because of 105,000 jobs lost from the sector over the last year. It calls for better pensions, child care provision and decent wages. The 36-page submission also urges the government to examine support other European countries provide to industry. TUC General Secretary Brendan Barber called for "a commitment to policies that will make a real difference to the lives of working people."
+
+"Greater investment in childcare strategies and the people delivering that childcare will increases the options available to working parents," he said. "A commitment to our public services and manufacturing sector ensures that we can continue to compete on a global level and deliver the frontline services that this country needs." He also called for "practical measures" to help pensioners, especially women who he said "are most likely to retire in poverty". The submission also calls for decent wages and training for people working in the manufacturing sector.

business/business_36.txt

@@ -0,0 +1,5 @@
+Bat spit drug firm goes to market
+
+A German firm whose main product is derived from the saliva of the vampire bat is looking to raise more than 70m euros ($91m; £49m) on the stock market.
+
+The firm, Paion, said that it hoped to sell 5 million shares - a third of the firm - for 11-14 euros a share. Its main drug, desmoteplase, is based on a protein in the bat's saliva. The protein stops blood from clotting - which helps the bat to drink from its victims, but could also be used to help stroke sufferers. The company's shares go on sale later this week, and are scheduled to start trading on the Frankfurt Stock Exchange on 10 February. If the final price is at the top of the range, the company could be valued at as much as 200m euros. The money raised will be spent largely on developing the company's other drugs, since desmoteplase has already been licensed to one manufacturer, Forest Laboratories.

business/business_37.txt

@@ -0,0 +1,11 @@
+Firms pump billions into pensions
+
+Employers have spent billions of pounds propping up their final salary pensions over the past year, research suggests.
+
+A survey of 280 schemes by Incomes Data Services' (IDS) said employer contributions had increased from £5.5bn to £8.2bn a year, a rise of 49.7%. Companies facing the biggest deficits had raised their pension contributions by 100% or more, IDS said. Many firms are struggling to keep this type of scheme open, because of rising costs and increased liabilities. A final salary scheme, also known as a defined benefit scheme, promises to pay a pension related to the salary the scheme member is earning when they retire.
+
+The rising cost of maintaining such schemes has led many employers to replace final salary schemes with money purchase, or defined contribution, schemes. These are less risky for employers. Under money purchase schemes, employees pay into a pension fund which is used to buy an annuity - a policy which pays out an income until death - on retirement.
+
+IDS said there were some schemes in good health.
+
+But, in many cases, firms had been forced to top up funds to tackle "yawning deficits". The level of contributions paid by employers has increased gradually since the late 1990s. In 1998/99, for example, contributions rose by 4.7% and in 2002/03 by 8.6%. In contrast, between 1996 and 1998, some employers cut their contribution levels. Helen Sudell, editor of the IDS Pensions Service, said the rise in contributions was "staggering" and the highest ever recorded by IDS. "We have warned before that the widespread closure of final salary schemes to new entrants is just the beginning of a much bigger movement away from paternalistic provision," said Ms Sudell. "With figures like this there can be little doubt that many employers will have to reduce future benefits at some point for those staff still in these schemes."

business/business_38.txt

@@ -0,0 +1,7 @@
+UK homes hit £3.3 trillion total
+
+The value of the UK's housing stock reached the £3.3 trillion mark in 2004 - triple the value 10 years earlier, a report indicates.
+
+Research from Halifax, the country's biggest mortgage lender, suggests the value of private housing stock is continuing to rise steadily. All regions saw at least a doubling in their assets during the past decade. But Northern Ireland led the way with a 262% rise, while Scotland saw the smallest increase of just 112%.
+
+The core retail price index rose by just 28% in the same period, underlining how effective an investment in housing has been for most people during the past decade. More than a third of the UK's private housing assets - representing more than a trillion pounds in value - are concentrated in London and the South East, the Halifax's figures indicate. Tim Crawford, Group Economist at Halifax, said: "The value of the private housing stock continues to grow and the family home remains, by a large margin, the most valuable asset of the majority of households in the UK." Halifax's own monthly figures on house sales - issued on Thursday - suggest the average price of a British property now stands at £163,748 after a 0.8% rise in January. Housing experts are split on prospects for the market, with some saying price growth will slow but not fall, while others predict a sharp drop in values.

business/business_39.txt

@@ -0,0 +1,13 @@
+Market unfazed by Aurora setback
+
+As the Aurora limped back to its dock on 20 January, a blizzard of photos and interviews seemed to add up to an unambiguous tale of woe.
+
+The ship had another slice of bad luck to add to its history of health scares and technical trouble. And its owner, P&O Cruises - now part of the huge US Carnival Corporation - was looking at a significant slice chopped off this year's profits and a potential PR fiasco. No-one, however, seems to have told the stock markets. The warning of a five-cent hit to 2005 earnings came just 24 hours after one of the world's biggest investment banks had upped its target for Carnival's share price, from £35 to £36.20. Other investors barely blinked, and by 1300 GMT Carnival's shares in London were down a single penny, or 0.03%, at £32.26.
+
+Why the mismatch between the public perception and the market's response? "The Aurora issue had been an ongoing one for some time," says Deutsche Bank's Simon Champion. "It was clearly a source of uncertainty for the company - it was a long cruise, after all. But the stock market is very good at treating these issues as one-off events."
+
+Despite its string of bad luck, he pointed out, Aurora is just one vessel in a large Carnival fleet, the UK's P&O Princess group having been merged into the much larger US firm in 2003. And generally speaking, Carnival has a reputation for keeping its ships pretty much on schedule. "Carnival has an incredibly strong track record," Mr Champion.
+
+Similarly, analysts expect the impact on the rest of the cruise business to be limited. The hundreds of disappointed passengers who have now had to give up the opportunity to spend the next three months on the Aurora have got both a refund and a credit for another cruise. That should mitigate some of the PR risk, both for Carnival and its main competitor, Royal Caribbean. "While not common, cancellations for technical reasons are not entirely unusual in the industry," wrote analysts from Citigroup Smith Barney in a note to clients on Friday. "Moreover, such events typically have a limited impact on bookings and pricing for future cruises." After all, the Aurora incident may be big news in the UK - but for Carnival customers elsewhere it's unlikely to make too much of a splash.
+
+Assuming that Citigroup is right, and demand stays solid, the structure of the industry also works in Carnival's favour. In the wake of P&O Princess's takeover by Carnival, the business is now to a great extent a duopoly. Given the expense of building, outfitting and running a cruise ship, "slowing supply growth" is a certainty, said David Anders at Merrill Lynch on Thursday. In other words, if you do want a cruise, your options are limited. And with Carnival remaining the market leader, it looks set to keep selling the tickets - no matter what happens to the ill-fated Aurora in the future.

business/business_4.txt

@@ -0,0 +1,7 @@
+Glaxo aims high after profit fall
+
+GlaxoSmithKline saw its profits fall 9% last year to £6.2bn ($11.5bn), but Europe's biggest drugmaker says a recovery during 2005 is on the way.
+
+Cheap copies of its drugs, particularly anti-depressants Paxil and Wellbutrin, and a weak dollar had hit profits, but global sales were up 1% in 2004. The firm is confident its new drug pipeline will deliver profits despite the failure of an obesity drug. Chief executive Jean-Pierre Garnier said it had been a "difficult year".
+
+In early afternoon trade in London the company share price was down 1% at 1218 pence. Mr Garnier said the company had absorbed over £1.5bn of lost sales to generics but still managing to grow the business. "The continuing success of our key products means we can now look forward to a good performance in 2005," he said. "2005 will also be an important year in terms of research and development pipeline progress." However, the firm discontinued development of an experimental treatment for obesity, known as '771, after disappointing clinical trial results. Glaxo is relying on new treatments for conditions such as cancer, diabetes, depression, HIV/AIDS and allergies to lift the pace of sales growth after several disappointing years.

business/business_40.txt

@@ -0,0 +1,11 @@
+Renault boss hails 'great year'
+
+Strong sales outside western Europe helped Renault boost its profits by more than 40% in 2004 although the firm warned of lower margins this year.
+
+France's second largest carmaker enjoyed a healthy 43% rise in net profits to 2.4bn euros ($3.1bn; £2.9bn) as sales rose 8% to 40.7bn euros. The firm said strong demand outside western Europe and the good performance of its Megane range lifted its results. Chairman Louis Schweitzer said 2004 had been a "great year" for the firm.
+
+Renault sold more than 2.4 million vehicles in 2004, an increase of 4% on the previous year. Growth came mainly from outside western Europe, with particularly strong sales in Turkey, Russia and North Africa.
+
+In total, sales outside western Europe - Renault's core market - rose 16.5%. Japanese carmaker Nissan - in which Renault owns a 44% stake - contributed 1.7bn euros in net income over the year. Nissan chairman Carlos Ghosn is to succeed Mr Schweitzer at the head of Renault later this year.
+
+Renault said the outlook for the industry in Europe this year was "stable", with small growth forecast in other regions. The firm will benefit from the launch of a new Clio model in the coming year and the roll-out of the Logan in many markets. However, the firm said it expected operating margins to be lower in 2005, at 4% of sales as opposed to 5%. "In a sluggish market and an environment impacted by the rise in raw material prices, Renault intends to continue to grow its global sales," the company said in a statement.

business/business_41.txt

@@ -0,0 +1,7 @@
+Safety alert as GM recalls cars
+
+The world's biggest carmaker General Motors (GM) is recalling nearly 200,000 vehicles in the US on safety grounds, according to federal regulators.
+
+The National Highway Traffic Safety Administration (NHTSA) said the largest recall involves 155,465 pickups, vans and sports utility vehicles (SUVs). This is because of possible malfunctions with the braking systems. The affected vehicles in the product recall are from the 2004 and 2005 model years, GM said. Those vehicles with potential faults are the Chevrolet Avalanche, Express, Kodiak, Silverade and Suburban; the GMC Savana, Sierra and Yukon.
+
+The NHTSA said a pressure accumulator in the braking system could crack during normal driving and fragments could injure people if the hood was open. This could allow hydraulic fluid to leak, which could make it harder to brake or steer and could cause a crash, it warned. GM is also recalling 19,924 Cadillac XLR coupes, SRX SUVs and Pontiac Grand Prix sedans from the 2004 model year. This is because the accelerator pedal may not work properly in extremely cold temperatures, requiring more braking. In addition, the car giant is calling back 17,815 Buick Raniers, Chevrolet Trailblazers, GMC Envoys and Isuzu Ascenders from the 2005 model years because the windshield is not properly fitted and could fall out in a crash. However, GM stressed that it did not know of any injuries related to the problems. News of the recall follows an announcement last month that GM expects earnings this year be lower than in 2004. The world's biggest car maker is grappling with losses in its European business, weak US sales and now a product recall. In January, GM said higher healthcare costs in North America, and lower profits at its financial services subsidiary would hurt its performance in 2005.

business/business_42.txt

@@ -0,0 +1,15 @@
+Asian quake hits European shares
+
+Shares in Europe's leading reinsurers and travel firms have fallen as the scale of the damage wrought by tsunamis across south Asia has become apparent.
+
+More than 23,000 people have been killed following a massive underwater earthquake and many of the worst hit areas are popular tourist destinations. Reisurance firms such as Swiss Re and Munich Re lost value as investors worried about rebuilding costs. But the disaster has little impact on stock markets in the US and Asia.
+
+Currencies including the Thai baht and Indonesian rupiah weakened as analysts warned that economic growth may slow. "It came at the worst possible time," said Hans Goetti, a Singapore-based fund manager. "The impact on the tourist industry is pretty devastating, especially in Thailand." Travel-related shares dropped in Europe, with companies such as Germany's TUI and Lufthansa and France's Club Mediterranne sliding. Insurers and reinsurance firms were also under pressure in Europe.
+
+Shares in Munich Re and Swiss Re - the world's two biggest reinsurers - both fell 1.7% as the market speculated about the cost of rebuilding in Asia. Zurich Financial, Allianz and Axa also suffered a decline in value.
+
+However, their losses were much smaller, reflecting the market's view that reinsurers were likely to pick up the bulk of the costs. Worries about the size of insurance liabilities dragged European shares down, although the impact was exacerbated by light post-Christmas trading. Germany's benchmark Dax index closed the day 16.29 points lower at 3.817.69 while France's Cac index of leading shares fell 5.07 points to 3.817.69. Investors pointed out, however, that declines probably would be industry specific, with the travel and insurance firms hit hardest. "It's still too early for concrete damage figures," Swiss Re's spokesman Floiran Woest told Associated Press. "That also has to do with the fact that the damage is very widely spread geographically."
+
+The unfolding scale of the disaster in south Asia had little immediate impact on US shares, however. The Dow Jones index had risen 20.54 points, or 0.2%, to 10,847.66 by late morning as analsyts were cheered by more encouraging reports from retailers about post-Christmas sales. In Asian markets, adjustments were made quickly to account for lower earnings and the cost of repairs. Thai Airways shed almost 4%. The country relies on tourism for about 6% of its total economy. Singapore Airlines dropped 2.6%. About 5% of Singapore's annual gross domestic product (GDP) comes from tourism. Malaysia's budget airline, AirAsia fell 2.9%. Resort operator Tanco Holdings slumped 5%.
+
+Travel companies also took a hit, with Japan's Kinki Nippon sliding 1.5% and HIS dropping 3.3%. However, the overall impact on Asia's largest stock market, Japan's Nikkei, was slight. Shares fell just 0.03%. Concerns about the strength of economic growth going forward weighed on the currency markets. The Indonesian rupiah lost as much as 0.6% against the US dollar, before bouncing back slightly to trade at 9,300. The Thai baht lost 0.3% against the US currency, trading at 39.10. In India, where more than 2,000 people are thought to have died, the rupee shed 0.1% against the dollar Analysts said that it was difficult to predict the total cost of the disaster and warned that share prices and currencies would come under increasing pressure as the bills mounted.

business/business_43.txt

@@ -0,0 +1,13 @@
+Oil prices reach three-month low
+
+Oil prices have fallen heavily for a second day, closing at three-month lows after news that US crude stocks have improved ahead of winter.
+
+London Brent crude closed at $40.15 on Thursday - a drop of 5.1% - having dived below $40 a barrel for the first time since mid-September. US light crude traded in New York lost more than $2 to $43.25, its lowest close since 10 September. The price of both benchmark crudes has dropped 12% in two days. The falls were triggered when the Energy Information Administration (EIA) said on Wednesday that US crude stocks were 3.5% higher than a year ago. The news calmed worries about winter shortages. Weak US fuel and heating oil stocks have been a persistent factor in pushing up oil prices. "It's amazing how quickly sentiment changed," said Rick Mueller, an analyst at Energy Security Analysis. Analysts also attributed the fall to mild early-winter weather, which has tempered demand for heating oil.
+
+The stronger fuel inventories helped boost US stock markets to nine-month highs on Wednesday, though only the Nasdaq index had hung onto those gains by the end of Thursday.
+
+In London, the FTSE 100 index closed 15 points higher at 4,751. The long-awaited drop in oil prices helped to ease persistent investor jitters over the impact of energy costs on company profits and economic growth. However, traders warned that the fall could be short-lived if there is a cold snap in North America this winter or any major supply problems in other parts of the world.
+
+The price of crude is still up about 30% on the start of 2004, but has fallen from the record of $55.67 set in late October. Opec nations have increased production to 25-year highs to meet global demand and this has helped rebuild US stocks hit by supply disruptions after Hurricane Ivan in September. Traders were also encouraged by comments on Wednesday from the energy minister of Opec member Algeria. Chakib Khelil said the cartel was likely to keep output unchanged when it meets next week. However, some analysts believe the sharp fall in crude prices may harden Opec's attitude to over-production, leading to a scaling back of oil output.
+
+Fears still remain over the level of US heating oil stocks, which are rising but remain down on 2004 levels. A cold spell in north America would start to deplete supplies and could spark further price rises. Analysts, however, say prices will fall further if inventories continue to rise. "Mother Nature is going to be huge in the next several weeks," said Kyle Cooper, at Citigroup Global Markets. "Long term I think we're headed to $30-35 but I don't think we're doing that yet. We have a lot of winter left." John Person, president of National Futures Advisory Services, said the EIA data indicated there should be adequate supplies for the next three months in the US. .

business/business_44.txt

@@ -0,0 +1,13 @@
+Markets fall on weak dollar fears
+
+Rising oil prices and the sinking dollar hit shares on Monday after a finance ministers' meeting and stern words from Fed chief Alan Greenspan.
+
+The London FTSE fell 0.8% while Tokyo's Nikkei 225 dropped 2.11%, its steepest fall in three months. G20 finance ministers said nothing about supporting the dollar, whose slide could further jeopardise growth in Japan and Europe. And Mr Greenspan warned Asian states could soon stop funding the US deficit.
+
+On Monday afternoon, the euro was close to an all-time high against the dollar at above $1.30. Oil pushed higher too on Monday, as investors fretted about cold weather in the US and Europe and a potential output cut from oil producers' group Opec, although prices had cooled by the end of the day. In London, the benchmark Brent crude price closed down 51 cents at $44.38 a barrel, while New York light sweet crude closed down 25 cents at $48.64 a barrel. The slide comes as the US has been attempting to talk up the traditional "strong dollar" policy.
+
+The latest to pitch in has been President George W Bush himself, who told the Asia Pacific Economic Co-operation (Apec) summit in Chile that he remained committed to halving the budget deficit. Together with a $500bn trade gap, the red ink spreading across America's public finances is widely seen as a key factor driving the dollar lower. And last week US Treasury Secretary John Snow told an audience in the UK that the policy remained unaltered. But he also said that the rate was entirely up to the markets - a signal which traders took as advice to sell the dollar. Some had looked to the G20 meeting for direction. But Mr Snow made clear exchange rates had not been on the agenda.
+
+For the US government, letting the dollar drift is a useful short-term fix.
+
+US exports get more affordable, helping perhaps to close the trade gap. In the meantime, the debt keeps getting bigger, with Congress authorising an $800bn rise in what the US can owe - taking the total to $8.2 trillion. But in a speech on Friday, Federal Reserve chairman Alan Greenspan warned that in the longer term things are likely to get tricky. At present, much of gap in both public debt is covered by selling bonds to Asian states such as Japan and China, since the dollar is seen as the world's reserve currency. Similarly, Asian investment helps bridge the gap in the current account - the deficit between what the US as a whole spends and what it earns. But already they are turning more cautious - an auction of debt in August found few takers. And Mr Greenspan said that could turn into a trend, if the fall of the dollar kept eating into the value of those investments. "It seems persuasive that, given the size of the US current account deficit, a diminished appetite for adding to dollar balances must occur at some point," he said.

business/business_45.txt

@@ -0,0 +1,9 @@
+Five million Germans out of work
+
+Germany's unemployment figure rose above the psychologically important level of five million last month.
+
+On Wednesday, the German Federal Labour Agency said the jobless total had reached 5.037 million in January, which takes the jobless rate to 12.1%. "Yes, we have effectively more than five million people unemployed," a government minister said earlier on ZDF public television. Unemployment has not been this high in Germany since the 1930s.
+
+Changes to the way the statistics are compiled partly explain the jump of 572,900 in the numbers. But the figures are embarrassing for the government. "With the figures apparently the worst we've seen in the post-war period, these numbers are very charged politically," said Christian Jasperneite, an economist with MM Warburg. "They could well put an end to the recent renaissance we've seen by the SPD [the ruling Social Democrats] in the polls, and with state elections due in Schleswig-Holstein and North Rhine-Westphalia, they may have an adverse effect on the government's chances there."
+
+The opposition also made political capital from the figures. It said there are a further 1.5 million-2 million people on subsidised employment schemes who are, in fact, looking for real jobs. It added that government reforms, including unpopular benefit cuts, do not go far enough. Under the government's controversial "Hartz IV" reforms, which came into effect at the beginning of the year, both those on unemployment benefits and welfare support and those who are long-term unemployed are officially classified as looking for work. The bad winter weather also took its toll, as key sectors such as the construction sector laid off workers. Adjusted for the seasonal factors, the German jobless total rose by 227,000 in January from December.

business/business_46.txt

@@ -0,0 +1,9 @@
+German bidder in talks with LSE
+
+Deutsche Boerse bosses have held "constructive, professional and friendly" talks with the London Stock Exchange (LSE), its chief has said.
+
+Werner Seifert met LSE chief executive Clara Furse amid rumours the German group may raise its bid to £1.5bn ($2.9bn) from its initial £1.3bn offer. However, rival suitor Euronext also upped the ante in the bid battle. Ahead of talks with the LSE on Friday, the pan-European bourse said it may be prepared to make its offer in cash. The Paris-based exchange, owner of Liffe in London, is reported to be ready to raise £1.4bn to fund a bid.
+
+The news came as Deutsche Boerse held its third meeting with the LSE since its bid approach in December which was turned down by the London exchange for undervaluing the business. However, the LSE did agree to leave the door open for talks to find out whether a "significantly-improved proposal" would be in the interests of LSE's shareholders and customers. In the meantime, Euronext, which combines the Paris, Amsterdam and Lisbon stock exchanges, also began talks with the LSE. In a statement on Thursday, Euronext said any offer was likely to be solely in cash, but added that: "There can be no assurances at this stage that any offer will be made." A deal with either bidder would create the biggest stock market operator in Europe and the second biggest in the world after the New York Stock Exchange. However, neither side has made a formal offer for the LSE, with sources claiming such a step may still be weeks away.
+
+Deutsche Boerse could also face mounting opposition to a bid at home. Among sweeteners reported to have been discussed by Mr Seifert with Ms Furse were plans to move the management of its cash and Eurex derivatives market to London, as well as two members of its executive board. But, Hans Reckers, a board member of Germany's central bank, the Bundesbank, said that cash trading should also remain in Frankfurt, something Deutsche Boerse could move to the UK. "It is not just the headquarters of the Boerse but also important market segments that must stay permanently in Frankfurt. This has special importance for the business activities of the banks and the consultants," he said. Local government officials in Frankfurt's state of Hessen have also spoken out against the move. "It is our wish that the headquarters stay here to maintain Frankfurt's standing as the number one financial centre in continental Europe," Alois Rhiel, its minister for economic affairs added.

business/business_47.txt

@@ -0,0 +1,7 @@
+Amex shares up on spin-off news
+
+Shares in American Express surged more than 8% on Tuesday after it said it was to spin off its less profitable financial advisory subsidiary.
+
+The US credit card to travel services giant said off-loading American Express Financial Advisors (AEFA) would boost its profitability. AEFA has more than 12,000 advisers selling financial advice, funds and insurance to 2.5 million customers. Over the years it has delivered poor profits and even some losses.
+
+"This is an excellent move by American Express to focus on its core businesses, and sell off a laggard division, which has been a problem for quite some time," said Marquis Investment Research analyst Phil Kain. Analysts estimate that a stand-alone AEFA could have a market value of $10bn (£5.3bn). The unit was acquired by American Express 20 years ago as Investors Diversified Service, of Minneapolis, at a time when firms were amassing one-stop financial empires. However, the business of selling investments was never integrated with the rest of the group.

business/business_48.txt

@@ -0,0 +1,7 @@
+Stock market eyes Japan recovery
+
+Japanese shares have ended the year at their highest level since 13 July amidst hopes of an economic recovery during 2005.
+
+The Nikkei index of leading shares gained 7.6% during the year to close at 11,488.76 points. In 2005 it "will rise toward 13,000", predicted Morgan Stanley equity strategist Naoki Kamiyama. The optimism in the financial markets contrast sharply with pessimism in the Japanese business community. Earlier this month, the quarterly Tankan survey of Japanese manufacturers found that business confidence had weakened for the first time since March 2003.
+
+Slower economic growth, rising oil prices, a stronger yen and weaker exports were blamed for the fall in confidence. Despite this, traders expect strength in the global economy to benefit Japan, which has been close to sliding into recession in recent months. Structural reform within Japan and an anticipated end to the banking sector's bad debt problems should also help, they say.

business/business_49.txt

@@ -0,0 +1,15 @@
+Iraqi voters turn to economic issues
+
+Beyond the desperate security situation in Iraq lies an economy in tatters.
+
+A vicious cycle of unemployment, poor social services and poverty has been made worse by a lack of investment. So there is much hope that an elected government will break the deadlock. "First rule of law, then the economy," says Radwan Hadi, deputy managing director of Aberdeen-based oil and gas consultancy Blackwatch Petroleum Services, which entered Iraq in 2003. Mr Hadi's view about what the new government's priorities should be is shared by many Iraqis. The economy has become the second-most dominant issue for many political parties ahead of Sunday's election, according to Bristol University political scientist Anne Alexander, who is working on a project that looks at governance and security in post-war Iraq.
+
+Job creation ranks high both on election manifestos and on the Iraqi people's wish list. Nobody knows exactly how many Iraqis are out of work, but it is clear that the situation is dire. "Estimates of Iraq's unemployment rate vary, but we estimate it to be between 30-40%," the Washington-based independent think-tank The Brookings Institution says in its Iraq Index. But some progress has been made, largely thanks to the country's oil revenues which have exceeded $22bn since June 2003.
+
+Iraq's infrastructure is on the mend, with notable improvements having been made in areas such as electricity supply, irrigation, telephone networks and the re-opening of hospitals. But serious problems remain and the growing divide between haves and have-nots is angering voters. One Iraqi woman told Ms Alexander about her frustration as she watched TV adverts for private hospitals soon after having failed to track down basic medicines from Baghdad's pharmacies. Observes Mr Hadi: "The economy at present marks a big divide; the rich get richer, the poor get poorer." An indication of this can be seen in the world of finance where, in contrast with the daily plight of ordinary people, 19 private banks operate, only one of which is run in accordance with Islamic banking principles. Hopes are high for the future of finance, so foreign banks have been buying into the sector. National Bank of Kuwait has bought a majority stake in Credit Bank of Iraq, the Jordanian investment bank Export & Finance Bank has bought 49% of National Bank of Iraq.
+
+Foreign firms also hope to cash in on the reconstruction effort. Bechtel's efforts to rebuild schools and restore power have attracted controversy as well as boosting its bottom line while Halliburton has enjoyed a wealth of military contracts. But the involvement of foreign firms in the health and banking sectors and beyond sits uneasily with many Iraqis who are accustomed to the state taking responsibility for functions that are essential to making society work, observes Ms Alexander. "It is seen as a selling off of Iraq's assets and bringing in multinationals at the expense of Iraqi businesses and Iraqi workers," she says. Consequently, the transitional government has been forced to backtrack in recent months over its proposal to allow 100% foreign ownership of Iraqi assets, she explains. In the West, it is easy to forget that the otherwise brutal Baathist regime used to look after the majority of Iraq's citizens rather well in terms of job creation, social security and healthcare. Opinion polls suggest that "people still want the state to take a leading role in providing these things", Ms Alexander says.
+
+Yet in some areas of the economy, investment from abroad is still warmly welcomed, insists Mr Hadi, an Iraqi who left the country three decades ago. "I think the private sector will evolve incredibly fast," Mr Hadi says. "Iraq's vast natural resources can support any magnitude of economic growth."
+
+Many foreign companies say they are keen to get in on the act, yet few are actually entering the country in any meaningful way. But there are exceptions. Mr Hadi's Blackwatch is just one of many small operators preparing for a much bigger future. Blackwatch's Baghdad-based affiliate Falcon Group has dozens of people working for it across the country in Kirkuk and Baghdad, and its engineers and geo-scientists work with the Iraqi oil ministry to hammer out technology transfer issues, Mr Hadi points out. "These guys are trying to work. The Iraqi business people will do business at all times. "Life goes on in Iraq, the people take responsibility, they want to live normal lives."

business/business_5.txt

@@ -0,0 +1,7 @@
+Peugeot deal boosts Mitsubishi
+
+Struggling Japanese car maker Mitsubishi Motors has struck a deal to supply French car maker Peugeot with 30,000 sports utility vehicles (SUV).
+
+The two firms signed a Memorandum of Understanding, and say they expect to seal a final agreement by Spring 2005. The alliance comes as a badly-needed boost for loss-making Mitsubishi, after several profit warnings and poor sales. The SUVs will be built in Japan using Peugeot's diesel engines and sold mainly in the European market. Falling sales have left Mitsubishi Motors with underused capacity, and the production deal with Peugeot gives it a chance to utilise some of it.
+
+In January, Mitsubishi Motors issued its third profits warning in nine months, and cut its sales forecasts for the year to March 2005. Its sales have slid 41% in the past year, catalysed by the revelation that the company had systematically been hiding records of faults and then secretly repairing vehicles. As a result, the Japanese car maker has sought a series of financial bailouts. Last month it said it was looking for a further 540bn yen ($5.2bn; £2.77bn) in fresh financial backing, half of it from other companies in the Mitsubishi group. US-German carmaker DaimlerChrylser, a 30% shareholder in Mitsubishi Motors, decided in April 2004 not to pump in any more money. The deal with Peugeot was celebrated by Mitsubishi's newly-appointed chief executive Takashi Nishioka, who took over after three top bosses stood down last month to shoulder responsibility for the firm's troubles. Mitsubishi Motors has forecast a net loss of 472bn yen in its current financial year to March 2005. Last month, it signed a production agreement with Japanese rival Nissan Motor to supply it with 36,000 small cars for sale in Japan. It has been making cars for Nissan since 2003.

business/business_50.txt

@@ -0,0 +1,11 @@
+China continues breakneck growth
+
+China's economy has expanded by a breakneck 9.5% during 2004, faster than predicted and well above 2003's 9.1%.
+
+The news may mean more limits on investment and lending as Beijing tries to take the economy off the boil. China has sucked in raw materials and energy to feed its expansion, which could have knock-on effects on the rest of the world if it overheats. But officials pointed out that industrial growth had slowed, with services providing much of the impetus. Growth in industrial output - the main target of government efforts to impose curbs on credit and investments - was 11.5% in 2004, down from 17% the previous year.
+
+Still, consumer prices - at 2.4% - rose faster than in 2004, adding to concern that a sharp rise in producer prices of 7.1% could stoke inflation. And overall investment in fixed assets was still high, up 21.3% from the previous year - although some way off the peak of 43% seen in the first quarter of 2004. The result could be higher interest rates. China raised rates by 0.27 percentage points to 5.8% - its first hike in nine years - in October 2004.
+
+Despite the apparent rebalancing of the economy the overall growth picture remains strong, economists said. "There is no sign of a slowdown in 2005," said Tim Congdon, economist at ING Barings.
+
+China's economy is not only gathering speed thanks to domestic demand, but also from soaring sales overseas. Figures released earlier this year showed exports at a six-year high in 2004, up 35%. Part of the impetus comes from the relative cheapness of the yuan, China's currency. The government keeps it pegged close to a rate of 8.28 to the US dollar, - much to the chagrin of many US lawmakers who blame China for lost jobs and competitiveness. Despite urging to ease the peg, officials insist they are a long way from ready to make a shift to a more market-set rate. "We need a good and feasible plan and formulating such a plan also needs time," National Bureau of Statistics chief Li Deshui told Reuters. "Those who hope to make a fortune by speculating on a renminbi revaluation will not succeed in making a profit."

business/business_51.txt

@@ -0,0 +1,21 @@
+Japan's ageing workforce: built to last
+
+In his twenties he battled tuberculosis for eight years, then went on to run his own clothing business before marrying in his late thirties. And the 101-year-old Torao Toshitsune has eaten raw fish pretty much every day throughout his life.
+
+Mr Toshitsune is one of Japan's 23,000 centenarians - a club that is growing by 13% annually, and where the oldest member is 114. At his neat Osaka detached house, where he lives with one of his sexagenarian daughters, Mr Toshitsune keeps a regular routine of copying out Buddhist sutras and preparing the traditional Japanese tea ceremony. Between tasks, this remarkably active senior citizen reveals what his next goal is: "Well, what's most important for me is to be Japan's number one." Mr Toshitsune wants to outlive everyone. And when it comes to longevity, Japan, as a country, appears to be doing just that. Women can expect to live until 85, men until 78, four years longer than Americans and Europeans.
+
+On the outskirts of Kyoto, 83-year-old Yuji Shimizu contemplates this phenomenon during a round of golf with his younger friends, who are in their seventies.
+
+"I think this is because the food industry and the environment have improved," he remarks. "On average, we can live longer." Whether it's the diet, or the traditional family structure where roles were clearly defined, or just something in the genes, Japan's elderly are remarkable. But while life may be a game of golf for Mr Shimizu, his grandchildren have huge problems ahead. Japan is the world's least fertile nation with childbirth rates of just two thirds of that in the US.
+
+By 2007, Japan's population is expected to peak at 127 million, then shrink to under 100 million by the middle of the century. This means 30 million fewer workers at a time when the number of elderly will have almost doubled.
+
+"In the year 2050, if the birth rate remains the same people over 60 will make up over 30% of the population," explains Shigeo Morioka of the International Longevity Centre in Tokyo. So how will Japan's finances stay on track? After a decade of economic stagnation and huge deficit spending, the public sector debt is already about 140% of the country's gross domestic product (GDP), the highest rate among industrialised countries. The International Monetary Fund predicts that as the falling birth rate takes grip from 2010, the cost of running Japan's welfare state will double to more than 5% of GDP, while current account balances will deteriorate by over 2%. But unfortunately, Japan appears poorly prepared both financially and politically. Glen Wood, Vice President of Deutsche Securities Japan, asks; "Who's going to fund the pension fund for the next generation and indeed who are going to be the new Japanese worker? "Who is going to build the economy, who are going to be the leaders? Who are going to be the producers of the GDP going forward?" One option is further welfare reform. Another is immigration, possibly from the Philippines and Indonesia. But so far, any emerging policy appears restricted to a limited number of nursing staff.
+
+Standing next to Tokyo harbour is a version of New York's Statue of Liberty. But, as yet, Japan is not ready for an Ellis Island.
+
+"Japan has never really liked that option in its history and I think it's an option that's becoming more and more plausible and necessary," insists Mr Wood. In Japan, as in Europe which also faces a workforce decline, immigration is a very sensitive subject. But for the Japanese economy, facing 8% fewer consumers by 2050 means slumping domestic sales of cars, hi-tech kit and home appliances, perhaps even another property crash.
+
+Of course the Japanese could always have more children. The government is currently considering financial rewards for procreative couples similar to those in operation in Australia. But there would be no pay back until 2030, when today's babies are taxpayers, and the demographic crisis, like in Europe, starts to unfold in 2010. In contrast to Japan - and of course the European Union - the US population is expected to increase by 46% to 420 million by the middle of the century. Although President Bush must re-devise Social Security to take account of a 130% rise in America's over 65s, the IMF foresees a positive contribution to the US current account balance from the combined forces of fertility and immigration.
+
+Some voices in Japanese industry are calling for radical changes to the nature of the Japanese labour market. They want a shift towards financial services, though doubts persist over the country's ability, let alone willingness, to move away from manufacturing. "Japan still has problems getting a viable banking system, let alone shifting their auto business or their semi-conductor business or the broad based tech manufacturing business overseas," says Mr Wood. Japan can either drive some radical reforms or else run the risk of a vicious ageing recession. Falling demand and a lower tax take could result in soaring budget pressures and a basket case currency. Come 2020, Japan could be more dependent on a shrinking workforce than any other industrialised power. There are fears that the world's number two economy is doomed to a permanent recession. But none of this is Mr Toshitsune's concern anymore. At 101, he chuckles that, he feels fine.

business/business_52.txt

@@ -0,0 +1,11 @@
+UK economy facing 'major risks'
+
+The UK manufacturing sector will continue to face "serious challenges" over the next two years, the British Chamber of Commerce (BCC) has said.
+
+The group's quarterly survey of companies found exports had picked up in the last three months of 2004 to their best levels in eight years. The rise came despite exchange rates being cited as a major concern. However, the BCC found the whole UK economy still faced "major risks" and warned that growth is set to slow. It recently forecast economic growth will slow from more than 3% in 2004 to a little below 2.5% in both 2005 and 2006.
+
+Manufacturers' domestic sales growth fell back slightly in the quarter, the survey of 5,196 firms found. Employment in manufacturing also fell and job expectations were at their lowest level for a year.
+
+"Despite some positive news for the export sector, there are worrying signs for manufacturing," the BCC said. "These results reinforce our concern over the sector's persistent inability to sustain recovery." The outlook for the service sector was "uncertain" despite an increase in exports and orders over the quarter, the BCC noted.
+
+The BCC found confidence increased in the quarter across both the manufacturing and service sectors although overall it failed to reach the levels at the start of 2004. The reduced threat of interest rate increases had contributed to improved confidence, it said. The Bank of England raised interest rates five times between November 2003 and August last year. But rates have been kept on hold since then amid signs of falling consumer confidence and a slowdown in output. "The pressure on costs and margins, the relentless increase in regulations, and the threat of higher taxes remain serious problems," BCC director general David Frost said. "While consumer spending is set to decelerate significantly over the next 12-18 months, it is unlikely that investment and exports will rise sufficiently strongly to pick up the slack."

business/business_53.txt

@@ -0,0 +1,11 @@
+Steady job growth continues in US
+
+The US created fewer jobs than expected in December, but analysts said that the dip in hiring was not enough to derail the world's biggest economy.
+
+According to Labor Department figures, 157,000 new jobs were added last month. That took 2004's total to 2.2 million, the best showing in five years. Job creation was one of last year's main concerns for the US economy. While worries still remain, the conditions are set for steady growth in 2005, analysts said. The unemployment rate stayed at 5.4% in December, and about 200,000 jobs will need to be created each month if that figure is to drop.
+
+"It was a respectable report," said Michael Moran, analyst at Daiwa Securities.
+
+"Payroll growth in December was a little lighter than the consensus forecast, but we had upward revisions to the prior two months and an increase in manufacturing employment." "Manufacturing is a cyclical area of the economy and if it's showing job growth, it's a good indication that the economy is on a solid growth track." That means that the Federal Reserve is likely to continue its policy of raising interest rates. The Fed lifted borrowing costs five times last year to 2.25%, citing evidence the US economic recovery was becoming more robust.
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+Job creation was one of last year's main concerns for the US economy, and proved to be a main topic of debate in the US presidential election. While demand for workers is far from booming, the conditions are set for steady growth. "Overall, compared to the previous year it looks great, it just keeps going stronger and stronger and I expect that to be the case" in 2005, said Kurt Karl, economist at Swiss Re in New York. Meanwhile, economists cautioned against reading too much into data from the Federal Reserve showing an unexpected $8.7bn drop in consumer debt in November. A fall in consumer spending, which makes up about two-thirds of all US economic activity, could help limit the extent of any future interest rate rises. But economists said there could be a number of reasons for a fall in the borrowing, which include credit cards and personal loans, while noting that such figures can vary on a month-to-month basis.