Thai cabinet approves 2nd phase of economic stimulus packages

Special
Report: Global Financial Crisis

BANGKOK, May 6 (Xinhua) -- The Thai weekly cabinet meeting on Wednesday
approved the country's second phase of the economic stimulus packages worth of
1.4 trillion baht (39.78 billion U.S. dollars) to shore up the country's
sluggish economy, Finance Minister Korn Chatikavanij said.

The budget will cover several investments in transportation, irrigation,
education and public health projects from this year to 2012, the minister said.

It is estimated the investments will create jobs for two million people and
the country's long-term competitive advantages will also be boosted, Korn said.

The investment projects will kick off after the House of Representatives
approves a loan borrowing plan to finance this second phase packages.

Korn said the loan sources will be mainly from the domestic market amid the
ample liquidity.

Although the budget allocation might result in the country's higher public
debt, the government's financial status will remain strong, said Korn.

It is estimated the country's public debt will rise to 60 percent of the
gross domestic product (GDP) in 2013 from the current 40 percent of the GDP,
said Korn.

"The return of the investments, however, will be worthwhile," are port of
the local media Bangkok Post quoted Korn as saying.

Korn estimated the country's public debt would start leveling off in 2014
and should stay at 47 percent of the GDP in 2018.

Interview: Russian businessman sees great progress in China

Special Report:
Global Financial Crisis

by Hai Yang, Zhao Jialin

MOSCOW, May 5 (Xinhua) -- Mikhail Bayev, owner of a tea culture club in
Moscow who visits China every year, is amazed at constant developments in the
major developing country.

Bayev, in his 50s, told Xinhua recently that "so many changes have taken
place in China, it is difficult to describe in just a few words."

When first visiting Beijing in the early 1990s, Bayev was struck most by
the cramped, inconvenient living conditions of the traditional courtyard houses.

He said no houses had private toilets and most families shared a communal
one, and in winter, people had to stockpile coal to ensure heating.

However, in only a matter of years his friends who once lived in courtyard
houses, had moved into newly-built apartments with modern facilities.

Bayev said besides Beijing, he was also impressed with the rapid
development of other smaller cities in China.

While traveling in areas of southwest China's Yunnan Province to buy Puer
tea, Bayev said the first thing that caught his attention was the
well-constructed roads and convenient transportation.

When visiting the homes of local people, he was amazed that most were
equipped with modern household appliances.

"Some homes had solar panels and even satellite TV antennas on their
roofs," he said.

Bayev has visited almost all the popular tea producing areas of China,
including the eastern provinces of Zhejiang, Anhui, Fujian, the central province
of Henan, and the southwestern provinces of Sichuan and Yunnan.

"All the people with whom I made contacts with are just ordinary folks.
Over the last 10 years, their lives have got better and better," he said.

"All this proves that the policies of your country are correct," Bayev
said.

He said the China's policies were becoming more open and the country was
making great progress on environmental issues.

Bayev recalled that he once planned to learn martial arts in China during
the 1960s, but the strained ties between China and the former Soviet Union
prevented him from doing so.

"But today China is a highly open and civilized country. People can all
feel at ease no matter who the person -- natives or foreigners," Bayev said.

Egypt's central bank slashes key interest rates to boost economy

Special Report:Global Financial Crisis

CAIRO, Feb. 13 (Xinhua) -- The Central Bank of Egypt (CBE) said Friday that
it has decided to cut its key overnight interest rates by 1 percent to boost the
economic growth of the country.

The overnight interest rates will be cut by 1 percent to 10.5 percent for
deposits and 12.5 for lending, the CBE said in a statement.

The decision of the bank's monetary policies committee is meant to maintain
the country's economic growth rate due to a recent plunge of inflation rate,
reported the state MENA news agency, citing the statement.

According to earlier reports, Egypt's inflation rate was down to 14 percent
in January on a year-on-year basis as commodity prices ebbed worldwide.

The overall annual inflation rate was 14 percent in January, the lowest one
since April, compared with 18.7 percent in December, the country's Central
Agency for Public Mobilization and Statistics (CAPMAS) said Tuesday.

The Egyptian economic growth rate, recorded more than 7 percent in the past
three fiscal years, is likely to witness a slowdown due to the current
international financial crisis.

The CBE said it will take further measures to contain the negative
influence of the international financial crisis on the country's economy.

Financial indicators mostly right in Tanzania

Special Report:Global Financial Crisis

By Yi Gaochao

DAR ES SALAAM, Feb. 10 (Xinhua) -- The important financial indicators for Tanzanian economy are mostly right despite the inroads of the global financial crisis, according to the chief of Tanzania's central bank.

According to figures released by the central banker to the country's lawmakers in Dodoma, Tanzania's political capital city, 31 of Tanzania's 34 commercial banks had a capital adequacy of 17 percent compared to the required 10 percent.

The banks' liquidity ratio averaged 42 percent, above the required level of 20 percent while deposits stood at 68 percent as against a required limit of 80 percent.

Most encouraging is Tanzania's foreign exchange reserves which by last week stood at 2.8 billion U.S. dollars which are hailed as strong enough to guarantee the country's financial stability and investors' confidence in the country.

Local banks combined to have another foreign exchange reserve of 600 million dollars, according to Bank of Tanzania Governor Benno Ndulu.

The bank governor has assured the general public that the country's financial sector therefore remains strong and safe despite the global economic downturn.

"The inter-bank settlement system continued to be trusted among the key stakeholders," said the central bank governor, "(The) inter-bank cash market is performing well."

He attributed the 15-percent depreciation of the Tanzanian shilling to the U.S. dollar so far to the ongoing economic crunch.

"This drop is not only of the Tanzanian shilling but has also affected currencies such as the Kenyan shilling which has dropped by up to 9.7 percent, Ugandan shilling (by) 20 percent while South African Rand dropped by 50 percent," he added.

Economists and analysts have warned that Tanzania's economic growth may well be affected by such adverse factors as inflation, current account deficit, low level of domestic revenue rather than reduced international aid inflow amid the ongoing financial crisis.

An International Monetary Fund report has earlier warned that lower growth would dampen government revenues in Tanzania, suggesting that the current path of spending would lead to widening fiscal deficits and a financing gap.

The IMF has identified that the real weaknesses of Tanzania's economy was its huge current account deficit which averages 13.3 percent of the country's annual gross domestic product over the 2005-2011 period.

Local economists have added low level of domestic revenue as another adverse factor to affect the country's growth. In the current fiscal year ending in June this year, domestic revenue is projected to account for 16 percent of the GDP. The ratio was 12.5 percent two years back.

Central banker Benno Ndulu has called for sound macro-economic management to mitigate effects of the global economic meltdown.

The governor has also called for financial discipline during the execution of the government budget plan so as to keep the country's financial sector on the right track.

Tanzanian economic growth hampered more by inflation,deficits

Special Report:Global Financial Crisis

By Yi Gaochao

DAR ES SALAAM, Feb. 7 (Xinhua) -- Economists and analysts have warned that Tanzania's economic growth may well be affected by such adverse factors as inflation, current account deficit, low level of domestic revenue rather than reduced international aid inflow amid the ongoing financial crisis.

As government officials are blaming the global financial crisis for difficulties in implementing the 2008/2009 budget, economists from the University of Dar es Salaam (UDSM) have pointed out that the shortcomings in implementing the budget were more as a result of internal factors than the repercussion of the global meltdown.

UDSM scholar Haji Semboja argued that the governmental authorities should have taken enough precautions to contain the possible adverse effects of the financial crisis which actually started in 2007.

An International Monetary Fund report has warned that lower growth would dampen government revenues, suggesting that the current path of spending would lead to widening fiscal deficits and a financing gap.

The IMF has identified that the real weaknesses of Tanzania's economy was its huge current account deficit which averages 13.3 percent of the country's annual gross domestic product over the 2005-2011 period.

Local economists have added low level of domestic revenue as another adverse factor to affect the country's growth.

In the current fiscal year ending in June this year, domestic revenue is projected to account for 16 percent of the GDP. The ratio was 12.5 percent two years back.

Though local economists believe that foreign aid would not reduce only because of the ongoing financial crisis, the country's reliance on international aid has been criticised by local analysts and critics.

They have argued that after nearly half a century of donor assistance, Tanzania can still not finance either its budget or its balance of payments.

The country relies on foreign aid for above 10 percent of its GDP and on direct foreign investment for above four percent of its GDP so as to compensate for the gap left by more government spending than domestic revenue.

Local economists have even proposed that the Tanzanian authorities should forecast a gradual reduction in aid inflows and instead promote a steady increase in domestic financing, taxing and borrowing, and whip up a substantial rise in exports to narrow the trade gap.

Doctor Haji Semboja has recommended that the government's medium- and long-term strategies should be to reduce donor dependency and to do more by the country itself.

Minister: Tunisia's industry to suffer from global downturn in 2009

TUNIS, Jan. 23 (Xinhua) -- Tunisia's industry minister said on Friday the industrial sector, the most labor intensive one in the country, is expected to be hit by the world downturn in 2009, and called on local firms to reform structures and enhance productivity.

"We expect that 2009 will be a difficult year for our companies as the country's industrial sector was under pressure of the global financial and economic crisis since November," Industry Minister Afif Chelbi was quoted by the official TAP news agency assaying.

"So it's important for our companies to improve their productivity, to list on Tunisia's bourse and restructure their financial structures in order to upgrade their competitiveness," Chelbi added.

The crisis, however, will create new chances for Tunisian firms to improve their positioning as a good destination for foreign cash as they offer qualified workforce with costs lower than those by eastern European countries after they joined the European Union(EU), according to the minister.

The country drew 352.3 million dinars (250.92 million U.S. dollars) over the first nine months this year, creating 10,149 jobs, according to government data.

The North African country eyes to double industrial exports, especially to the European bloc, its main trade partner, to 30 billion dinars by 2016.

Tunisia, whose industry accounts for 28 percent of the national wealth, launched an upgrading competitiveness program in 1996 to provide local firms with the needed financial and technical aid in order to improve productivity. (1 U.S. dollar = 1.404 dinar)