Category: Business

PM threat to Brown’s IMF job

KATE DEVLIN UK POLITICAL CORRESPONDENT

A senior economist accused David Cameron of being vindictive yesterday after the Prime Minister suggested he would block Gordon Brown from getting a top international job.

David Blanchflower, a former member of the Bank of England’s Monetary Policy Committee, described the PM’s stance as “small minded”.

It follows speculation that Mr Brown might be put forward to head the International Monetary Fund (IMF). Crucial for any nomination would be the endorsement of the individual’s home country.

However, Mr Cameron indicated he would block a potential bid by his predecessor as Prime Minister. He said Mr Brown “might not be the most appropriate person” for the job, because of his record in office.

In a deliberate jibe at the former Labour leader, he added that he thought the job should go to “someone who understands the danger of excessive debt”.

The Tories and the LibDems have been highly critical of Labour’s economic record since entering Coalition last year, blaming the party for leaving them with a record deficit.

Labour have defended their time in office, and claim the problems we caused by the global banking crisis.

Mr Brown gave a speech on economics to students at Edinburgh University last night, based on his book, Beyond The Crash. He was defended by current Labour leader Ed Miliband, who said he was “eminently qualified” for the job.

Mr Miliband also attacked Mr Cameron’s comments saying: “To rule someone out even before the vacancy has arisen seems to be going some, even for him.”

Asked about the PM’s remarks, Mr Blanchflower said: “This is the most vindictive thing I’ve heard from a Prime Minister in 50 years. It looks to me to be extremely small-minded.”

The role of managing director of the IMF carried a salary of around £270,000, as well as a crucial position in world finance. Countries currently in receipt of IMF aid include Greece and the Republic of Ireland.

It is expected the job could become free if current head Dominique Strauss-Kahn stands down this summer to mount a bid for the French presidency. There has also been speculation his replacement would come from countries with emerging world markets.

It is not the first time Mr Brown’s name has been linked with the job. In 2004, when he was chancellor, Downing Street was forced to shrug off rumours about him joining the IMF.

In recent months the IMF has repeatedly backed the Coalition austerity drive, including cuts of £81m in public spending.

Ironically, the Tories have also been vocally critical of Mr Brown’s workload in recent weeks.

The former PM did not speak in the Budget debate last month and has voted only a handful of times in the House of Commons since leaving Downing Street.

His office says he has concentrated on constituency work as well as writing his book.

heraldscotland.com, 20 Apr 2011

April 20, 2011
Iranian firms break into world markets via Turkey

Monday, April 18, 2011

GÖKHAN KURTARAN

ISTANBUL – Hürriyet Daily News

Companies in Iran are finding their way to the world economy through Turkey, developing strong trade ties in recent years, according to a Turkish business representative.

“Turkey is replacing Dubai for Iranian firms,” Bilgin Aygün, the vice chairman of Turkish-Iranian Business Council at Foreign Economic Relations Board of Turkey, or DEİK, told the Hürriyet Daily News & Economic Review on Monday. “The best of Iranian firms penetrate world markets through Turkey,” he said, noting that cultural, historical and religious links go back hundreds of years as well as Iranian firms’ interest in Turkey.

“Many Iranian firms with warehouses in Dubai are now considering Turkey due to the geographical advantages it offers,” he said, adding that direct flights offered by Turkish Airlines to four Iranian cities have paved the way for business growth between the two countries.

According to figures from the Turkish Prime Ministry’s Undersecretariat of Treasury, the number of Iranian firms in Turkey reached to 1,470 by the end of last year. The figure for the years between 1954 and 2002 was only 319.

Starting from 2002, the year that Turkey’s ruling Justice and Development Party, or AKP, came into power, every year nearly a hundred new Iranian firms started to operate on Turkish soil. Iranian firms’ interest in Turkey even continued during the global recession and 139 new firms were registered in Turkey in 2008.

According to figures, 167 Iranian firms started to operate in the country in 2009 before a record-breaking sum of 284 last year.

The total capital of top 74 Iranian companies out of 167 that were registered in Turkey in 2009 was between $50,000 and $200,000. The capital of only seven Iranian companies that registered in the country was above $500,000. In 2010, the capital of 284 new Iranian companies in the country summed up $9.83 million.

“Bilateral trade volume has increased 50 percent as of the end of last year,” Aygün said.

It was “considerably” easier for Turkish businessmen to work with Iranian firms as almost one in every three speaks Azeri, a dialect similar to Turkish, said the vice chairman. “Turkey could penetrate eastern markets through Iran while Iran penetrates western markets through Turkey.”

Energy trade

Turkish dependency on energy imports has increased the strategic importance of Iran for the country, Aygün said. “Turkey and Iran could join forces and invest in third countries, especially in Tajikistan and Afghanistan that are strongly under the influence of Iran.”

He said an Iranian business delegation would visit Istanbul in September to meet with Turkish businessmen to negotiate the possibility of investment in third countries. “A Turkish business delegation from DEIK would visit Tehran for the same purpose in April 2012.”

Turkey’s oil imports reached 7.8 million tons in 2008 and slumped down to 3.2 million tons in 2009. According to Energy Market Regulatory Body, or EPDK, Turkey’s total import of oil from Iran reached 5.3 billion tons by the end of last year. Natural gas import of Turkey reached 5.2 million cubic meters by the end of last year from 4.1 million cubic meters in 2008 and 5.2 million in 2009.

More border gates

Turkey and Iran opened a third border crossing at Kapıköy in eastern province of Van province last Saturday. Speaking at the opening ceremony, Turkish Foreign Minister Ahmet Davutoğlu said, “Our prime minister set a target of $30 billion in annual trade with Iran. That is why we are opening this border crossing.”

“This border is a symbol of peace and friendship and the resurrection of the Silk Road, which for centuries played an important role in making the economy of the region flourish,” said Foreign Minister Ali Akbar talking at the ceremony.

According to Turkish Prime Minister the economic relations between two countries would be boosted with a fourth border to be opened in Dilucu in northeast of Turkey and a fifth crossing border in Dillucu in northeastern Turkey without giving a date for opening.

“Iran’s foreign trade volume is approximately $150 billion,” Mehmet Koca, chief executive officer of Gübretaş, told the Daily News.

The Turkish fertilizer acquired Iran’s Razi Petrochemical in 2008 for $656 million euros. Noting that the business opportunities between the two countries had tremendous growth potential, Koca said, Turkish and Iranian trade volume floats around $10 billion as the total foreign trade volume of Iran has reached approximately $150 billion by last year.

Koca said Turkey has nearly a $3 billion share in Iran’s total imports of $60 billion last year. According to Koca, “The figures show that Iran meets nearly 95 percent of its import demand from countries other than Turkey.”

“In recent years, with the attempts of the Turkish government, Turkey has improved trade relations with Iran,” said Koca, noting that economic relations gained new momentum thanks to increasing political and economic influence of Turkey in its hinterland. Koca said the current trade volumes are still way below the potential, in order to accelerate the economic relations, “Iran’s approach to the world carries significant importance.”

“The new border crossings taking place between two countries, Iranian firms opening new firms in Turkey in order to penetrate worldwide economies through Turkey demonstrate that the economic relations between Iran and Turkey have developed to a great extent,” said Koca.

Turkey’s total trade volume with Iran reached $10.6 billion by the end of last year, according to Turkish Statistical Institute, or TurkStat. Turkey’s total export volume to Iran reached nearly $3 billion in last year rose from nearly $2 billion of 2009. Turkey’s import volumes also skyrocketed to $7.64 billion in 2010 compared with $3.4 billion in previous year.

April 19, 2011
Biggest spending squeeze on families since 1921

Squeezed: relative spending power is down to the lowest levels since 1921

Families are facing the biggest peace-time squeeze in their spending power since 1921 as wages fail to keep up with soaring inflation, according to a new report.

The rising cost of essential items such as oil, utility bills, food and clothes are set to leave the average household with £910 a year less to spend in 2011 than two years ago, said the Centre for Economics and Business Research (CEBR).

Disposable incomes are due to fall by 2% in 2011, following a 0.8% drop in 2010, as cash-strapped consumers suffer the biggest hit to their finances apart from during World War Two and the recession following the First World War, it added.

It forecasts that inflation will average 3.9% in 2011 – its highest since 1992 – as January’s hike in VAT to 20% from 17.5% and the rising cost of oil and other commodities continue to drive up prices.

Pay packets, on the other hand, will rise just 1.9% as unemployment remains high and the public sector makes cut-backs.

But the Government’s austerity drive is “only a minor element in the squeeze on household incomes”, with the soaring cost of commodities being the major factor, claimed the report.

Commodity prices are being driven higher by surging demand from emerging economies such as China and supply shocks including the conflict in Libya, which is impacting the price of oil.

The lack of consumer spending power means the economy will only grow by 1% in 2011 and will be “subdued” for the next two or three years, said the consultancy. Its forecast is significantly below the 1.7% predicted by Government’s Office for Budget Responsibility.

The CEBR’s report echoes the views of Bank of England governor Mervyn King who earlier this year said consumers’ finances were facing their biggest squeeze since the 1920s.

A spate of retailers have reported tough conditions on the high street in 2011 as consumers remain cautious, with HMV and Dixons Retail which owns Currys and PC World reporting disappointing profits.

www.thisislondon.co.uk, 11 Apr 2011

April 17, 2011
International money transfers to Turkey to rise?

HiFX News@ 12:00 AM

International money transfers to Turkey could be on the rise with a number of “exceptional” property developments due to launch this year.

A recent press conference, held by the Turkish Real Estate Investing Partners Association, revealed that property sales in Turkey to foreigners rose by 40 per cent last year compared to 2009.

Indeed, total sales to people from abroad were valued at around $2.5 billion (£1.53 billion).

President of the association, Ipyk Gokkaya, said that the boost in sales is due an increasing level of confidence in Turkey as a whole.

Julian Walker, managing director of Turkish property agents Spot Blue, added that Turkey has learned from other Mediterranean markets and has “steadily increased its real estate offering to foreigners without over stretching resources or demand”.

Using an international money transfer service to send money to Turkey could help to keep down the cost of wiring cash internationally if you are considering purchasing overseas property.

Click here to make an International Money transfer to Turkey

Posted by Sarah PittonADNFCR-1995-ID-800502361-ADNFCR

via International money transfers to Turkey to rise? | News | HiFX News.

April 17, 2011
‘Iran-Turkey trade volume tops $11bn’

The value of trade between Iran and Turkey has surpassed 11 billion dollars in the past year, says the Turkish ambassador to Tehran.

Turkish Ambassador to Iran Umit Yardim

Umit Yardim noted on Wednesday that the two neighboring states are trying to increase their trade volume to $15 billion by the end of 2011, IRNA reported.

Yardim also said that Tehran and Ankara plan to bring the number to $30 billion within the next five years “by using their regional capacities.”

Meanwhile, the trade volume between Iran and Turkey also jumped by more than 70 percent in the first two months of 2011 to surpass $2.144 billion.

According to the Turkish Statistical Institute, the volume of trade between the two countries reached $963.559 million in February, showing 43.65 percent increase compared with the same period in the previous year.

Turkey exported $575.324 million worth of goods to Iran and its imports from Iran, including oil and gas, hit $984.638 million in February.

Last year, Turkish Prime Minister Recep Tayyip Erdogan said that Ankara is seeking to triple trade volumes with Iran over the next five years.

Erdogan added that Tehran and Ankara were near signing a “preferential trade agreement” that could see trade volumes swell to $30 billion in the period.

DB/MRS/MGH

via PressTV – ‘Iran-Turkey trade volume tops $11bn’.

April 14, 2011
Toyota halts production in Turkey in tsunami aftermath

ISTANBUL – Daily News with wires

A crippling parts shortage in the aftermath of the March 11 disaster in Japan has hit Toyota Motor’s production in Turkey, too. The company has decided to temporarily halt production at its European plants, including the one in Sakarya. The factory produces the ‘Verso’ and ‘Auris’ models and employs 2,600 workers

The Toyota factory in Sakarya, western Turkey, employs 2,600 workers. AA photo

Toyota Motor has announced the suspension of production in its European plants, including Turkey, due to a serious shortage of parts following the March 11 earthquake and tsunami in Japan.

“We will not produce in our Sakarya factory [in northwestern Turkey], in accordance with the decision of Toyota Europe,” said Orhan Özer, the chief executive of Toyota Turkey.

“Most of our parts are supplied by Turkey and Europe, but we are having a supply deficit in the small number of parts that come from Japan,” Doğan news agency, or DHA, quoted him as saying.

The car manufacturer said Wednesday that it would halt European output at five plants between April 21 and May 2, including auto assembly factories in Turkey, Britain and France, as well as engine plants in Britain and Poland.

After the stoppages, the plants will run at limited capacity in May, the Associated Press reported.

Toyota Turkey is working to normalize the supply chain as soon as possible, Özer said.

The magnitude-9.0 earthquake and ensuing tsunami on March 11 destroyed auto parts factories in northeastern Japan, causing severe shortages for Toyota and other automakers. The world’s top automaker had said last week that it would suspend car production in North America in April.

The company’s Japanese plants will start production at a capacity of 50 percent as of April 18. The Sakarya factory produces the “Verso” and “Auris” models. Toyota’s production target for 2011 stands at 95,000 vehicles.

The Toyota factory employs 2,600 workers, while the parts industry in the region is estimated to employ about 6,000 more.

Big losses in the pipeline

Speaking to AP, Mamoru Kato, an auto analyst from Tokai Tokyo Securities, said that if the supply crunch continued, Toyota could incur “big losses” in the April-June quarter.

“The company simply cannot manufacture cars due to parts shortages. In North America and Europe, Toyota procures almost all engine parts from Japan. Suspended production in Japan and North America is a big blow to Toyota,” he said.

Toyota stock closed Wednesday slightly higher at 3,285 yen in Tokyo trading. The shares lost over 8.6 percent since the March 11 disaster.

In an analysis released Wednesday, three economists from Roubini Global Economics said challenges in substituting key Japanese inputs would raise global prices of those inputs and related final goods, particularly electronics and automobiles.

“Upstream Asian producers that compete directly with Japan will likely exercise more pricing power, commensurate with the degree of specialty of their product, provided they have adequate inventories,” said Michael Manetta, Arpitha Bykere and Adam Wolfe in their report. “But the boost to their export revenues may be offset by weaker global demand and lower production relative to 2010.”

In another development, Daihatsu Motor, a unit of Toyota, announced it would restart its Osaka and Kyoto plants on April 18, resuming production at all its factories.

April 14, 2011