Archive for May, 2011

Rich nations don’t want to give up IMF power: India

Saturday, May 28th, 2011 | Finance News

NEW DELHI (AFP) – India's prime minister Saturday said there appeared little hope that an emerging nation candidate would be chosen to head up the International Monetary Fund in the current contest.

Wealthy nations do not want to give up their power, the Press Trust of India quoted Premier Manmohan Singh as saying aboard a plane carrying him home from Tanzania following a six-day trip to Africa.

"The struggle for a better, balanced and more equitable world order, including the management of global institutions like the IMF, the World Bank, the (UN) Security Council, is going to be a long haul," Singh said.

Five top emerging powers -- India, Brazil, Russia, China and South Africa -- have complained that the IMF top job should not automatically go to a European, as tradition dictates.

Singh said India was in touch with various nations seeking a consensus candidate to head the IMF after the resignation of Dominique Strauss-Kahn, who is on bail in the United States awaiting trial on sex charges.

The Indian premier's comments came a day after France announced that the country's finance minister Christine Lagarde would visit India as part of a tour to drum up support for her bid to become the next IMF chief.


China reprimands Vietnam over offshore oil exploration

Saturday, May 28th, 2011 | Finance News

BEIJING (Reuters) – China criticized Vietnam on Saturday for its offshore exploration of oil and gas in the contested South China Sea after Hanoi complained that three Chinese patrol boats had challenged a Vietnamese ship.

The Vietnamese ship, the Binh Minh 02, detected the Chinese patrol boats approaching on radar at about 5 a.m on Thursday, the official Vietnam News Agency reported.

About an hour later, the three Chinese boats intentionally ran through the area where the Vietnamese ship was working, snapping cables the ship was using, then left the scene after about three hours, it said.

China's Foreign Ministry implied the fault for the incident lay with Vietnam.

"China's stance on the South China Sea is clear and consistent. We oppose oil and gas operations conducted by Vietnam, which have undermined China's interests and jurisdictional rights in the South China Sea and violated the consensus both countries have reached on the issue," ministry spokeswoman Jiang Yu said.

"What relevant Chinese departments did was completely normal marine law-enforcement and surveillance activities in China's jurisdictional sea area," she said in a statement posted on the ministry's website (

"China has been committed to safeguarding peace and stability in the South China Sea. We are willing to work together with relevant parties to seek a solution to related disputes," Jiang added.

Vietnam's Foreign Ministry protested against the incident by passing a diplomatic note to representatives of the Chinese embassy in Hanoi on Thursday.

The South China Sea covers an area of more than 648,000 sq miles (1.7 million sq km), containing more than 200 mostly uninhabitable small islands, rocks and reefs.

China, Vietnam, the Philippines, Malaysia, Brunei and Taiwan all claim territories in the sea, which covers an important shipping route and is thought to hold untapped oil and gas reserves.

The incident this week took place in an area called Block 148 about 120 km (80 miles) off the south-central coast of Vietnam from the beach town of Nha Trang, the Vietnamese news agency said.

(Reporting by Ben Blanchard; editing by Myra MacDonald)


Inspectors say Greece missed all fiscal targets: magazine

Saturday, May 28th, 2011 | Finance News

BERLIN (Reuters) – Greece has missed all fiscal targets agreed under its bailout plan, a mission from an international inspection team found, putting further funding for Athens at risk, according to a German magazine.

"The troika asserts in its report to be presented next week that Greece had missed all its agreed fiscal targets," weekly Spiegel magazine reported in a prerelease.

The International Monetary Fund, the European Commission and the European Central Bank -- known as the troika -- currently have a team in Greece assessing how sustainable the country's debts are.

The mission will be holding meetings next week before an expected finalization of the report.

"The deficit in the public budget was higher than expected," the magazine said, referring to the report's findings.

"The reason is that the Greek government still spends more than agreed in the aid programme. On top of that tax income is still lower than demanded."

The IMF has already said it cannot release its part of a 12 billion euro aid tranche to Greece next month if fiscal conditions underpinning the bailout are not met and the European Commission's top economic official was quoted as saying the EU was setting the same conditions.

"We Europeans have the same conditions as the IMF," EU Economic Affairs Commissioner Olli Rehn was quoted as saying in the same prerelease for Monday's Spiegel magazine.

"We will decide on the next tranche after the troika's report. The situation is very serious," Rehn added.

At roughly 330 billion euros, or 150 percent of gross domestic product (GDP), Greece's debt is so high that many economists believe the country will inevitably have to

restructure eventually.

The ailing euro zone state, which triggered the sovereign debt crisis in 2009, also needs to garner support from opposition parties for fiscal reforms before the European Union and International Monetary Fund free up more payments.

EU officials have asked Athens to step up privatizations urgently and suggested setting up a trustee institution to help oversee the process, similar to the body that privatized East German companies after the fall of communism.

Spiegel magazine also said the troika's experts estimated Greece had assets worth 300 billion euros, which it could sell off to meet its targets.

(Reporting by Annika Breidthardt; Editing by John Stonestreet)