BNP Paribas to be ‘punished severely’, says boss

World Business News

A round up of the latest news for those doing business internationally

BNP Paribas to be ‘punished severely’, says boss

Zone(s): France ¦ Sector(s): Banking
[30 June 2014, BBC News] The boss of BNP Paribas has written to staff warning that the French banking giant will be fined heavily by US authorities.  “I want to be clear, we will be punished severely,” Jean-Laurent Bonnafe said in the internal memo.

The bank could be fined $8.9bn (£5.2bn) for allegedly violating sanctions rules as early as Monday, reports suggest. The Financial Times and New York Times also report that the bank will, unusually, admit guilt.

The bank is accused of breaking sanctions against Iran, Sudan and Cuba between 2002 and 2009.

More…

BIS: Central banks warned of ‘false sense of security’

World Business News

A round up of the latest news for those doing business internationally

BIS: Central banks warned of ‘false sense of security’

Zone(s): Global ¦ Sector(s): Economy, Interest Rates
[29 June 2014, BBC News] The Bank for International Settlements (BIS) has warned that ultra-low interest rates have lulled governments and markets “into a false sense of security”.  The Basel-based organisation – usually dubbed the “central banks’ central bank” – urged policy makers to begin to normalise rates.  “The risk of normalising too late and too gradually should not be underestimated,” the BIS said.

Markets have rallied since January. The FTSE all-world share index is up 5% so far this year, while the Vix, a measure of implied US market volatility known as the “fear index”, is at a seven-year low.

More…

Bulgaria makes arrests over banking plot

World Business News

A round up of the latest news for those doing business internationally

Bulgaria makes arrests over banking plot

Zone(s): Bulgaria ¦ Sector(s): Banking
[29 June 2014, BBC News]  Bulgarian authorities have arrested three more people on suspicion of plotting to destabilise the country’s banking system. Five people have now been arrested, after two were detained on Saturday. They are suspected of spreading false information about the health of Bulgaria’s banks, prompting runs on two of the country’s biggest banks. Bulgaria’s central bank has said there has been a systematic attempt to undermine the country’s banking system. Last week, it took over Corporate Commercial Bank, Bulgaria’s fourth-largest lender, following a run on deposits. Speculation that the run could spread hit bank share prices towards the end of the week.

More…

New Potatoes from the seabed

World Business News

A round up of the latest news for those doing business internationally

New Potatoes from the seabed

Zone(s): Denmark ¦ Sector(s): Food
[29 June 2014, The Copenhagen Post] By Nanna G Vansteelant: Denmark and the Netherlands are among the most intensively farmed countries in Europe, but space is running out. The need to expand into new areas, along with the sustainability trend, has inspired the Danish business, agriculture and research industries to farm the Danish seabed.  In 2010, 19 million tonnes of seaweed were produced globally. Some 95.5 percent of it originated from Asia and had an estimated market value of 31.5 billion kroner, according to an FAO report from 2012.

Read more at:
cphpost.dk/news/introducing-this-centurys-potato-seaweed-served-from-the-bed-of-the-ocean.10005.html

Islamic Finance in Russia

World Business News

A round up of the latest news for those doing business internationally

Islamic Finance in Russia

Zone(s): Russia ¦ Sector(s): Islamic Finance
[29 June 2014, The Moscow Times] By Alexey Eremenko, in Moscow: There are at least 10 million Muslims in Russia, but only four public organizations where they can invest and borrow in compliance with the Quran.Islamic finance is a fast-growing field worldwide, and proponents say it offers both ethical and practical benefits to the faithful and non-Muslims alike.

Russia, however, lags behind in the industry, analysts and Russian Islamic financiers interviewed by The Moscow Times agreed.Russian Muslims are slow to change their financial habits, while nonbelievers are plagued by a deep-rooted distrust of Islam — as are, to some extent, the financial authorities, who are in no hurry to adapt economic legislation to facilitate Islamic banking, analysts said.

More…

What’s cooking at Domino’s beside the pizza?

World Business News

A round up of the latest news for those doing business internationally

What’s cooking at Domino’s beside the pizza?

Zone(s): USA ¦ Sector(s): Food
[29 June 2014, CNBC]  By Katie Little, from the USA: Domino’s, the pizza chain, has unveiled a new type of delivery car called the DXP that comes with a built-in pizza warmer and extra-large drink holders. “It has a side door to store pizzas and it has places to put 2-liters and other items that sometimes might move around in most vehicles. It keeps them secure. It’s laid out especially for delivery drives,” said Mike McDaniel, general manager at a Domino’s Pizza, in Fort Smith, Arkansas, during a phone interview.

More…

A dying breed: The American shopping mall

World Business News

A round up of the latest news for those doing business internationally

A dying breed: The American shopping mall

Zone(s): USA ¦ Sector(s): Retail Economy
[29 June 2014, CBS News]  By Mark Strassmann, from the USA: America’s love affair with shopping malls began in 1956, when the nation’s first fully-enclosed mall, Southdale, opened its doors outside Minneapolis.  “This was the most exciting period in this economy,” said Robin Lewis, author of The New Rules of Retail.  “In the mid-’50s Dwight Eisenhower signed the Interstate Highway Act, and they constructed 54,000 miles of interstate highway. Now, what that did immediately is it provided mobility for the population, which, prior to that, had been mainly rural. So they began to move into the suburbs and cities. But also, what it afforded was the ability to construct these regional malls, and they just exploded across the country.”

Between 1956 and 2005, about 1,500 malls were built, including the Mall of America, one of the world’s biggest – 4.2 million square feet of stores, an amusement park, even a wedding chapel. And it attracts millions of visitors each year, from all over the world. It was a Golden Age of shopping, which lasted until a new Golden Age came along, courtesy of the Internet. “All of a sudden, the consumer now has every single retail store throughout the world a key tap away,” said Lewis.Today, malls across the U.S. are dying. No new enclosed mall has been built since 2006, and Lewis predicts fully half of all our malls will close in the next 10 years.

More…

Long list of reforms: What India Inc expects from PM Narendra Modi

World Business News

A round up of the latest news for those doing business internationally

Long list of reforms: What India Inc expects from PM Narendra Modi

Zone(s): India ¦ Sector(s): Economy
[29 June 2014, Economic Times – India]  Businessmen were a troubled lot in Ayn Rand’s final novel, Atlas Shrugged, published in 1957 but set in America of the future. Hemmed in by aggressive regulation the industrialists are seen deserting their businesses, fortunes and the country itself. The scenario created by Rand is quite similar to what many Indian businessmen felt in the last years of the UPA regime — hounded by the CBI, shackled by the Supreme Court and pilloried by activists turned politicians.

Today, Rand has an army of fans in India which has the third largest fan base outside of the US (after Britain and Canada) and her books sell many times more than those written by Karl Marx. And India has probably just witnessed a symbolic ‘shrug’ — a nudge of the shoulders that bears the load of the earth. It shakes up the earth.  Or that is what Indian businesses expect Prime Minister Narendra Modi to do — shake up the systems of India, make it easier to do business, clear up procedural hassles. In his first month as PM, Modi has not disappointed them.

More…

Websites streamline car-buying process

World Business News

A round up of the latest news for those doing business internationally

Websites streamline car-buying process

Zone(s): USA ¦ Sector(s): Autos, Internet
[28 June 2014, Boston Globe – Associated Press] By Dee-Ann Durbin, from the USA: Auto websites — once filled mostly with reviews and advice — are getting more sophisticated, connecting potential buyers with dealers and offering instant price guarantees. Some let buyers estimate their trade-in values and turn in credit applications online. One company even lets buyers complete the entire sale online and get cars delivered to their door.

The Internet lets shoppers enter a showroom armed with the same information as a dealer, said Chantel Lenard, Ford Motor Co.’s US marketing director. Sites let buyers configure their vehicles, see what others paid, and estimate the trade-in value of their car or truck. They could even walk into a dealership with a price locked in. ‘It’s truly become an equalizer in the shopping and negotiating process,’’ Lenard said at a recent Ford event.

More…

Landlords ready for round two on old-rent law

World Business News

A round up of the latest news for those doing business internationally

Landlords ready for round two on old-rent law

Zone(s): Lebanon ¦ Sector(s): Property
[28 June 2014, The Daily Star – Lebanon News]  From Beirut: Despite looming legal challenges for the new rent law, the bill was republished in the Official Gazette this week, leaving landlords rejoicing at their victory in a lengthy battle with longtime tenants. “We have been demanding this law for a while now and the re-publication is a very good step in the process,” Joseph Zoghaib, the head of the Landlords Association, told The Daily Star.

The law has been at the centre of controversy since it was proposed by the Cabinet two years ago, with tenants saying such a bill would displace thousands of families who rent in Beirut under an old law governing lease contracts signed before 1992. Inhabitants pay minimal rent fees that often amount to less than LL1million annually.

More…

Argentine Vice-President Boudou charged in corruption case

World Business News

A round up of the latest news for those doing business internationally

Argentine Vice-President Boudou charged in corruption case

Zone(s): Argentina ¦ Sector(s): Politics
[28 June 2014, BBC News] Argentine Vice-President Amado Boudou has been charged in a corruption case.  Mr Boudou is suspected of using his influence when he was economy minister to ensure that a contract to print Argentina’s currency was awarded to a company he allegedly controlled. Earlier this month, he was questioned for more than seven hours by a judge, in a closed-door court session. If convicted, he faces up to six years in jail. He denies any wrongdoing and has rejected calls to step down.

More…

Japanese companies playing catch-up in Cambodia

World Business News

A round up of the latest news for those doing business internationally

Japanese companies playing catch-up in Cambodia

Zone(s): Japan, Cambodia ¦ Sector(s): Trade
[28 June 2014, Nikkei Asian Review] Yuichi Shiga, Nikkei staff writer, Tokyo: Visitors to Cambodia are often struck by how time seems to move slowly. A blue sky and the breeze from a three-wheeled tuk-tuk taxi offer an exotic twist on the daily commute. But amid the “lost world” charm, change is afoot in Cambodia – especially in Phnom Penh, the capital, calling for a rethink of Japan’s economic ties with the landlocked Southeast Asian country.

Japan’s investment in Cambodia has long focused on aid. Tokyo has financed the construction of bridges and other infrastructure with official development assistance. At the grass-roots level, there are many volunteer efforts, with Japanese college students providing much of the muscle. But while these activities remain important, “Cambodia is moving into a different stage of development, which should be supported not through aid but through partnerships between companies,” according to one Japanese company official in the country.

More…

EU exit will harm UK, says leading British industry group

World Business News

A round up of the latest news for those doing business internationally

EU exit will harm UK, says leading British industry group

Zone(s): UK, EU ¦ Sector(s): EU Membership
[28 June 2014, The Observer/Guardian]  The leader of Britain’s biggest business group has said that the country’s economic success depends on it remaining a full member of the EU, after senior Tories revealed that more than 150 of the party’s MPs would campaign to leave the union in a referendum.

The warning, from CBI director general John Cridland, came after David Cameron admitted on Friday that he now faced an uphill struggle to convince the British people to remain inside the EU, in the run up to an in/out referendum which he has promised to hold by the end of 2017.

More…

Aus $4bn shares to hit market as vendors exit

World Business News

A round up of the latest news for those doing business internationally

Aus $4bn shares to hit market as vendors exit

Zone(s): Australia ¦ Sector(s): Finance, Stockmarket
[28 June 2014, The Australian] By Damon Kitney, Victorian Business Editor, Melbourne and Michael Bennet, Reporter, Sydney. From Australia: More than $4 billion worth of shares could flood the share market in the next six months as escrow periods lapse on a range of big-ticket floats from the past year — such as Nine Entertainment and Veda — prompting warnings from fund managers about the impact on share prices and the reputational risk for the companies involved. But bankers, enjoying the bumper run of floats after a dearth of deals in recent years, argued the market would be able to handle sell downs as there was strong demand for “liquidity events”.

More…

Philippine central bank says sees June annual inflation at 4.1-5.0%

World Business News

A round up of the latest news for those doing business internationally

Philippine central bank says sees June annual inflation at 4.1-5.0%

Zone(s): Philippines ¦ Sector(s): Economy
[28 June 2014, The Business Times] From Manila: Philippine inflation in June may have hit the highest in more than two and a half years on higher food prices including rice, and rising transport fares and school fees, the central bank chief said on Saturday. Annual headline inflation this month is forecast to be anywhere between 4.1 and 5 per cent compared with 4.5 per cent in May, Bangko Sentral ng Pilipinas Governor Amando Tetangco told reporters via a mobile phone text message.The top end of the forecast would be the highest since October 2011 when the headline figure was 5.2 per cent. It is also the upper end of the average inflation target of 3 to 5 per cent this year.

Read more at:
www.businesstimes.com.sg/breaking-news/asia/philippine-central-bank-says-sees-june-annual-inflation-41-50-20140628

Brazil is an economic slump, but Apple and others believe in the nation’s potential

World Business News

A round up of the latest news for those doing business internationally

Brazil is an economic slump, but Apple and others believe in the nation’s potential

Zone(s): Brazil ¦ Sector(s): Economy, Trade
[27 June 2014, Washington Post] By Peter Robison, David Biller and Christiana Sciaudone:  No, Steve Jobs declared. Apple wouldn’t put a store in Brazil, with its “crazy” and “super-high” taxation. That was 2010, and Jobs was writing, bluntly, to an official in Rio de Janeiro.  Four years later, Jobs’s successor had a different message for Brazilians.“‘Obrigado’ to everyone who visited our new store,” CEO Tim Cook tweeted in February, after 1,700 people packed into a Rio mall for the opening of the first Apple store in Latin America.

“We are Brazilians, with lots of pride and lots of love,” his blue-shirted employees sang, adapting a tune heard in stadiums and bars when the national soccer team plays.Apple is one of many foreign brands feeling the love for Brazil — even if Brazilians, mired in an economic slump, aren’t. As the country hosts this year’s World Cup and prepares for the Olympic Games in 2016, the optimism that led it to bid for the planet’s two most famous sporting events has all but evaporated.

More…

EU backs Juncker to head Commission in blow to UK

World Business News

A round up of the latest news for those doing business internationally

EU backs Juncker to head Commission in blow to UK

Zone(s): EU ¦ Sector(s): Commission Presidency
[27 June 2014, BBC News] EU leaders in Brussels have nominated former Luxembourg PM Jean-Claude Juncker to be president of the European Commission, in a blow to the UK. Prime Minister David Cameron called it “a serious mistake”. “This is going to be a long, tough fight,” he said. He had pushed for a vote on Mr Juncker – breaking with tradition – and 26 out of 28 countries backed him. Only Mr Cameron and Hungarian PM Viktor Orban voted against him. Mr Juncker is also likely to win a vote by Euro MPs. It is the most powerful job in Brussels – the Commission drafts EU laws, oversees national budgets, enforces EU treaties and negotiates international trade deals.

More…

In 2012, 85% of trips abroad by EU residents were in Europe

World Business News

A round up of the latest news for those doing business internationally

In 2012, 85% of trips abroad by EU residents were in Europe

Zone(s): EU ¦ Sector(s): Travel
[27 June 2014, Europa website] In 2012, 85% of trips abroad by EU residents were in Europe.  In 2012, EU28 residents made 1.2 billion trips of one night or more. Almost half of these trips (48%) were for holidays and leisure, 35% for visits to relatives and friends, 13% for business and 4% for other reasons. The average trip length was 5.2 nights. The most common means of transport for trips was private or rented cars1 (65%), followed by air planes (15%), trains (12%), buses (6%) and water vessels (2%).  Of the number of total trips, 76% were made within the country of residence (domestic trips), while 24% were made outside (outbound trips).

For these outbound trips, the main destination for EU28 residents was clearly Europe (85.4%), then followed Asia (4.5%), Africa (4.1%), North America (3.8%), Central and South America (1.9%) and Oceania (0.4%). More specifically, the top 3 destinations for outbound trips for residents of the EU28 were Spain, France and Italy.

More…

EU Business Climate Indicator decreases in June

World Business News

A round up of the latest news for those doing business internationally

EU Business Climate Indicator decreases in June

Zone(s): Europe ¦ Sector(s): Economy
[27 June 2014, Europa website]In June 2014 the Business Climate Indicator (BCI) for the euro area decreased by 0.14 points to +0.22. Managers’ evaluation of all five components of the BCI deteriorated. Caution increased in particular with regard to the level of past production, production expectations and overall order books. Export order books and the stocks of finished products were assessed only slightly more negatively. The BCI is based on a factor analysis of the euro area aggregate balances (seasonally adjusted) of five of the monthly questions in the industry survey (only employment and selling-price expectations are excluded).

More…

Economic Sentiment down in the euro area, broadly stable in the EU

World Business News

A round up of the latest news for those doing business internationally

Economic Sentiment down in the euro area, broadly stable in the EU

Zone(s): Europe ¦ Sector(s): Economy
[27 June 2014, Europa website]  In June the Economic Sentiment Indicator (ESI) decreased in the euro area (by 0.6 points to 102.0) while it remained broadly stable in the EU (-0.1 points at 106.4).

Euro area developments
The relapse of euro area sentiment to its April level means a continuation of the sideways movement observed in recent months. It resulted from a deterioration in industry, construction and, to a lesser extent, consumer confidence. Retail trade confidence remained broadly unchanged, while services confidence booked a slight improvement. Amongst the largest euro area economies, the ESI eased in Germany (-1.3), France (-1.2) and Italy (-1.0), while it increased in the Netherlands (+0.7) and, more significantly, in Spain (+2.2). Worth highlighting is the 4.6 points rise in Greece, bringing its ESI above the long-term average for the first time since August 2008.

EU developments
The headline indicator for the EU remained broadly stable (-0.1), owing to brightening sentiment in the two largest non-euro area EU economies, the UK (+2.2) and Poland (+1.2). EU services confidence rallied, while, as in the euro area, industry, construction and financial services confidence slipped. Consumer confidence remained virtually unchanged, whereas confidence in retail trade fell, contrasting with the broadly flat euro-area development. Consumers’ more cautious unemployment expectations and construction managers’ lower employment plans were also observed at EU-level. However, the downward revisions to employment plans in the retail trade and services sectors and the upward revision in industry meant a deviation from the euro area. EU price expectations were in line with those for the euro area.

More…