January 2nd , 2008 - IFCCI -

Pakistan polls 'impossible' on Jan. 8

ISLAMABAD : It appears "impossible" for Pakistan to hold an election on Jan. 8 because of unrest following the killing of Benazir Bhutto, election officials said Tuesday — an announcement that could spark protests by parties demanding that the polls be held on time.

The Election Commission said it would announce a date Wednesday after meeting with Pakistan's political parties. Bhutto's party and other opposition groups have called for the elections to be held as scheduled in hopes that sympathy following her slaying could translate to electoral gains.

The U.S., Britain and other countries view the parliamentary election as key to restoring democracy to Pakistan as it battles the rise of al-Qaida and Taliban militants. But they have indicated they would accept a slight delay if technical reasons dictated one.

Bhutto's killing last week thrust the country into crisis and triggered nationwide riots. Accusations over how exactly she was killed and who was responsible have been coupled with calls for independent international investigation into her assassination.

The violence left at least 44 people killed and mobs caused tens of millions of dollars in damage to homes, government offices and transport facilities, though the crisis has died down since Sunday amid a heavy police and army presence.

Election offices have not escaped the violence, including in Bhutto's home province of Sindh.

"Our offices in 10 districts of Sindh have been burned, the electoral rolls have been burned, the polling schemes, the nomination papers have been burned," commission spokesman Kanwar Dilshad told reporters. "We are in a very tricky situation."

He said it now "looks impossible" to hold the polls on Jan. 8.

Former Prime Minister Nawaz Sharif, who heads a large opposition party and is a vocal critic of Musharraf, has threatened street protests if the vote was delayed.

"We will agitate," Sharif told The Associated Press on Monday. "We will not accept this postponement."

The United States said a minor delay in elections would be acceptable if all parties agreed.

"The key here is that there be a date certain for elections," said Tom Casey, deputy spokesman for the State Department, said Monday. "We would certainly have concerns about some sort of indefinite postponement of the elections".

Bhutto was killed in a gun and suicide bomb attack that the government blamed on Islamic extremists. But many, pointing to video footage and medical reports, have disputed the Pakistani government's assertion that Bhutto died not from bullet or shrapnel wounds but from injuries sustained while hitting her head on her vehicle's sunroof during Thursday's attack.

Her husband and other opposition leaders have called for an international, independent investigation into the attack and accused Musharraf of failing to adequately protect her. Some close to Bhutto have alleged forces close to the U.S-backed former general may have been involved.

In a statement received Tuesday, the government — which has rejected charges of involvement in Bhutto's death — said it was "committed to a thorough and transparent investigation and will not shy away from receiving assistance from outside, if needed."

U.S. officials, meanwhile, said Washington had provided a steady stream of intelligence to Bhutto about threats against her by Islamic extremists after suicide attackers came close to killing her in a massive blast hours after she had returned from self-imposed exile in October.

"She knew people were trying to assassinate her," an intelligence official told The AP. "We don't hold information back on possible attacks on foreign leaders and foreign countries."

The official added, however, that while the U.S. could share the information, "it's up to (the recipient) how they want to take action."

The officials, who spoke to the AP on condition of anonymity due to the sensitivity of the matter, said the United States had quietly joined calls for Pakistan to allow international experts to join the probe into Bhutto's slaying.

The officials said they expected an announcement soon that investigators from Britain's Scotland Yard would be asked to play a significant role. Any U.S. involvement would be limited and low-key, they said.

President visits landslide-hit Tawangmangu

KARANGANYAR, Central Java : President Susilo Bambang Yudhoyono walked Monday to a landslide site at Ledoksari village, Tawangmangu district, Karanganyar regency, Central Java, where dozens of people were killed.

The President walked more than two kilometers to reach the landslide-devastated village.

He was accompanied among others by First Lady Ani Yudhoyono, Home Affairs Minister Mardiyanto, Public Works Minister Djoko Kirmanto, Social Affairs Minister Bachtiar Chamsyah, and Coordinating Ministers for People's Welfare Aburizal Bakrie.

Yudhoyono told the landslide victims that the government would deal with the disaster and urged them to move to safer areas.

SINGAPORE : Oil prices edged up Monday in Asia after declining in the previous session on a housing report that ignited fresh concerns about the U.S. economy.

Light, sweet crude for February delivery added 11 cents to US$96.11 a barrel in electronic trading on the New York Mercantile Exchange by midday in Singapore.

The contract fell 62 cents to settle at US$96 a barrel Friday after a report showed weak figures on new home sales in the United States. The data again raised fears about a possible economic slowdown in the world's largest consumer of oil products.

Oil prices remain supported, though, by concerns about supply disruptions from the oil-rich Middle East.

Turkish jets hit suspected Kurdish rebel shelters in northern Iraq for a third time on Dec. 26. Turkey has also launched a cross border raid and fired artillery at Kurdish rebel positions since the first airstrike on Dec. 16. The rebels have vowed to take the group's battle for autonomy deep inside Turkey if the cross-border airstrikes do not stop.

Most Asian markets drop on Bhutto assassination, worries about US economic outlook

BANGKOK : Most Asian markets fell Friday amid anxiety over the assassination of Pakistani opposition leader Benazir Bhutto and lingering worries about the outlook for the U.S. economy.

Bhutto's death on Thursday, just ahead of Jan. 8 elections, sent shock waves through international markets on worries that global instability may follow, although some analysts said the impact is likely to be limited.

"The sudden event has caught worldwide attention because Pakistan is not any other developing country. It is a nuclear-power country. However, we view the current response to the event to be short-term," Westcomb Securities said in a note.

While Pakistan's stock market was closed, the market reaction in neighboring India was muted. Mumbai's Sensex index dipped 9.77 points, or 0.05 percent, to close at 20,206.95.

In Tokyo, Japan's stock market wrapped up the year with a sharp drop. The Nikkei 225 index fell 256.91 points, or 1.7 percent, to 15,307.78 points.

For the year, the Nikkei lost 11.1 percent, its first annual decline in five years.

Japanese investors remain worried about the American economy - a vital export market - amid the subprime mortgage crisis. A report from Goldman Sachs that said write-downs at U.S. banks, including Citigroup Inc., Merrill Lynch & Co. and JPMorgan Chase & Co., may deepen, helped to squelch sentiment.

Also, a less-than-expected rise in U.S. durable goods orders exacerbated concerns about the U.S. economy. In New York Thursday, the Dow Jones industrial average dropped 1.4 percent to 13,359.6.

The Nikkei is likely to stagnate during the first half of 2008 but has a chance of recovering once the U.S. credit crunch settles down later in the year, said Kenichiro Yoshida, senior economist at Mizuho Research Institute in Tokyo.

"A pessimistic view is prevalent about the Nikkei," said Yoshida. "Looking ahead to next year, we must keep our eyes on Wall Street."

Trading in Tokyo is scheduled to reopen on Jan. 4 after the New Year's holidays.

Mainland Chinese markets ended a stellar - if turbulent - year Friday on a down note. The Shanghai Composite index fell 0.9 percent to 5,261.56 points on worries that authorities will raise interest rates or take other steps to cool the country's blazing growth.

But for the year, the benchmark index surged nearly 97 percent, making it the world's best-performing major stock index in 2007.

Looking ahead, concerns about tightening measures will likely restrain the market's gains next year, analysts said.

"We expect the stock market will go up in 2008, but the magnitude of the growth will be less than that of 2006 and 2007," said Gui Haoming, chief strategist of Shenyin & Wanguo Securities. "The economy will keep growing but there is uncertainty" about the "government's macro-economic control."

In Hong Kong, jitters over Bhutto's assassination and continued concerns about the U.S. economy dragged down the benchmark Hang Seng Index by 472.33 points, or 1.7 percent, to 27,370.6 points.

"I would suggest investors to avoid buying any stocks now amid the uncertain market outlook," said Castor Pang, a strategist at Sun Hung Kai Financial.

In Hong Kong, heavyweight China Mobile dropped 2.6 percent on concerns it may soon face a more competitive environment following a potential restructuring of China's telecom sector. China Netcom fell 4 percent.

Hong Kong winds up the year's trading on Monday and will be closed Tuesday for New Year's Day, as will all other Asian markets.

In Tokyo currencies, the U.S. dollar was trading at 112.78 in late afternoon trading, down sharply from 113.69 yen late Thursday in New York.

US dollar falls vs yen in Asia on Bhutto's death, exporters settling accounts before holidays

TOKYO : The dollar dropped against the yen in Asia Friday as traders reacted anxiously to the assassination of Pakistani opposition leader Benazir Bhutto and Japanese exporters settled accounts before going on their long New Year's holidays.

The dollar was trading at 112.92 yen in midafternoon in Tokyo, down from 113.69 yen late Thursday in New York. The euro fell to US$1.4622 from US$1.4627.

Tokyo players said the dollar will likely continue to fall throughout the day, probably at a faster pace, as players reduce their riskier assets following Bhutto's assassination Thursday, just days before Jan. 8 elections. Traders worried that her death might spark instability in a volatile region.

"It's clearly a dollar-selling factor since the U.S. is deeply involved with Pakistan," said Yuji Saito, head of foreign exchange at Societe Generale. "And Bhutto's news will likely lead to rises in oil prices, which would increase risks of the U.S. economy entering stagflation."

Traders say short-term players, who are wary about the greenback's outlook, are ready to sell the currency to lock in profits, using risk-aversion as an excuse.

Earlier Friday, Japan released several economic indicators, including employment figures that showed the jobs-to-applicants ratio in November fell to a two-year-low of 0.99, meaning there aren't enough jobs going around for people looking for employment.

However, reactions in the currency market were muted since players anticipate the Bank of Japan wouldn't be able to hike its rates anytime soon anyway.

Against other Asian currencies, the dollar was mixed. It rose 0.11 percent against Indian rupee to 39.448 while dropping 0.44 percent against South Korean won to 936.0.

Philippine president upbeat on economic outlook for 2008

MANILA: President Gloria Macapagal Arroyo said Thursday she is upbeat about the outlook for the Philippine economy in 2008 after it surged 7.1 percent in the first three quarters of this year.

"We are filled with hope as the year ends and a new year begins. Our country is stable, strong and peaceful. Our economy is vibrant, the stock market is on a bull run and investments come pouring in," she said in a statement before a Cabinet meeting on economic development.

"In the coming year, we should reap more blessings from our growing economy and national coffer," Arroyo said.

Revenue efforts will be doubled to balance the budget next year, while infrastructure projects will be accelerated, she said. Capital, knowledge, infrastructure and technology will be spread to the countryside to boost growth, she added.

Finance Secretary Margarito Teves called for more aggressive spending on public infrastructure as well as tourism investment and promotion to soften the impact of soaring oil prices and a forecast downturn in the global economy next year.

He said the remittances of Filipinos workers overseas must be channeled to infrastructure projects, which will be an outlet for excess dollars to also help temper the peso's strength.

Between January and October, remittances totaled US$11.87 billion, up 15 percent from a year ago and on track to meet the central bank's full-year target of US$14 billion.

Economists say the Philippines needs at least 7 percent annual gross domestic product to make progress on cutting poverty.

University of the Philippines economics professor Benjamin Diokno, a former budget secretary, projected that growth would be slower next year, noting that possible recession in the U.S. will affect the Philippine economy.