Archive for June, 2011

Japan’s Hoya to sell Pentax camera business to Ricoh

Thursday, June 30th, 2011 | Finance News

TOKYO (Reuters) – Japanese optical glass-maker Hoya said on Friday it would sell its Pentax camera business to copier and printer maker Ricoh, in a deal the Nikkei business daily said was worth about 10 billion yen ($124.2 million).

Battling falling prices for its compact cameras, Ricoh hopes to establish a presence in the profitable upmarket single-lens reflex camera segment, the Nikkei business daily said.

The two companies will hold a news conference about the transaction at 0730 GMT.

The deal will go through in October, Hoya said in a filing to the Tokyo Stock Exchange.

Shares in Hoya ended up 4 percent at 1,845 yen, after climbing as high as 6 percent to 1,888 yen on the news, while Ricoh was down 0.2 percent, in a broader market climb of 0.5 percent.

Hoya, which bought Pentax in 2007 mainly to gain access to its medical technology, had been widely expected to sell off the camera business.

Pentax is the world's tenth largest digital camera brand by shipments, with just 1.5 percent of the market, according to research firm IDC.

Sales of Pentax cameras dropped just over 13 percent in the year ended March 2011, amid fierce price competition in the compact camera market.

Copier and printer-maker Ricoh, which aims to shed nearly 10 percent of its workforce to improve profits, also has a digital camera business, but sales are too small to feature in global data.

(Additional reporting by Emi Emoto; Writing by Isabel Reynolds; Editing by Edwina Gibbs)


Venezuela’s Chavez says he was treated for cancer

Thursday, June 30th, 2011 | Finance News

CARACAS (Reuters) – Venezuela's flamboyant socialist leader Hugo Chavez said on Thursday he had surgery to remove a cancerous tumor, presenting a serious challenge to his near-total dominance of the South American OPEC nation since 1999.

The announcement from Cuba confirmed rumors swirling for nearly three weeks but still stunned Venezuelans ahead of what was already looking like a tight race for a presidential election next year.

Speaking from Havana where he underwent surgery on June 10, a pale and emotional Chavez gave no indication when he would return to Venezuela. Nor did he name a temporary substitute to lead the polarized nation of 29 million people.

"They confirmed the existence of a tumorous abscess, with the presence of cancerous cells, which needed another operation to extract the tumor completely," he said in his first address to the nation since his surgery.

Chavez, 56, said he was receiving "complementary treatments to combat different types of cells that were found" -- possibly implying chemotherapy.

"I deeply appreciate the demonstrations of solidarity by Venezuelans and other brotherly people," he added, standing at a lectern by a Venezuelan flag and a painting of his inspiration, South American independence hero Simon Bolivar.

Analysts say a prolonged absence could trigger infighting among his allies -- none of whom possess Chavez's charisma or national appeal -- and possibly prompt calls for an early election by opposition parties gearing up for a 2012 poll.

"It is impossible to deduce if he will or will not be in a physical state and the right mood to go into the 2012 campaign," said local analyst Luis-Vicente Leon said.

During his 12-year rule, Chavez alienated many for nationalizing large swathes of the economy and showing an authoritarian streak both in his stranglehold on government and his tough treatment of political opponents.

He has, though, won support from the poor for channeling oil revenues into social projects like free shanty-town health clinics, and has won almost every election his government has fought, undermining the argument of foes who call him a dictator.

In contrast to his usual jocular and improvisational style, Chavez read a statement while frequently looking down at notes. He looked serious but not weak or debilitated.

He recognized, maybe for the first time since taking office, that his health had been compromised by his leadership style, based on intense micro-management, constant coffee-swilling and little sleep.

"Throughout my life I've been committing fundamental errors ... of not taking care of my health and being reluctant about medical treatment," he said.

Until Thursday, the official line had been that he was recovering well from an operation to remove a pelvic abscess and would return soon.


Inheriting former Cuban revolutionary leader Fidel Castro's mantle as Washington's main irritant in Latin America, Chavez has become one of the world's most well known leaders during his 12 years in power.

Comparing his health problem to a previous dark moment -- a short-lived 2002 coup attempt -- Chavez promised he would be back in typically grandiose language.

"I want to talk to you about the rising sun, I think that we have emerged," he said.

There were fireworks in the poor west end of Caracas, a bastion of Chavez supporters, and people on the streets shouted "He's alive! He's alive!"

Others reacted with disbelief but vows of solidarity and confidence Chavez will recover.

"He is the best president we have had, a strong man," said Santiago Valledare, a driver watching the speech and saluting the television screen at a Caracas bar.

Chavez's ministers gave a joint appearance minutes after his speech ended, pledging to deepen his wide-reaching socialist reforms even in his absence and saying the government would remain united.

"This is not the time to go backward, it's time to advance," Vice-President Elias Jaua said.

Critics of the stalwart socialist responded to the announcement with a mix of snide glee and optimism about the chances for an opposition leader to take over after nearly a decade of failing to unseat him.

"This will lead to a transition of presidents. It's perfect!" said Freddy Herrera, 25, an accountant. "Because the revolution doesn't work, because socialism is a lie."

His government has canceled a July 5-6 summit coinciding with Venezuela's 200th anniversary of independence. That was a heavy blow for supporters who wanted the charismatic but authoritarian president -- who loves to grandstand at such big events -- back home in time for the national party.

"This development may open a period of unprecedented social and political uncertainty in Venezuela," Goldman Sachs analyst Alberto Ramos said in a note to clients.

(Additional reporting by Deisy Buitrago, Diego Ore, Brian Ellsworth, Mario Naranjo, Eyanir Chinea and Girish Gupta)


EU-South Korea trade deal takes effect

Thursday, June 30th, 2011 | Finance News

SEOUL (AFP) – A sweeping free trade pact between the European Union and South Korea, the first in Asia for the world's largest economic bloc, came into effect on Friday, officials in Seoul said.

"The South Korea-EU Free Trade Agreement (FTA) took effect as of early Friday," Kim Hee-Sang, director for FTA negotiations at the Ministry of Foreign Affairs and Trade, told AFP.

The ministry said in a statement that the deal would "open up new opportunities for trade and investment" between South Korea and the EU and strengthen diplomatic relations between the two partners.

Under the pact, 70 percent of customs duties will be immediately scrapped, rising to 98.7 percent over the next five years.

Tariffs on 96 percent of EU goods and 99 percent of South Korean goods will be eliminated within the next three years.

The EU is currently South Korea's second largest trading partner after China, taking almost 20 percent of its exports.

EU exports to South Korea are worth 28 billion euros ($40.5 billion), while South Korea's exports to Europe amount to $38.7 billion.

On the eve of its implementation, the EU's ambassador in Seoul Tomasz Kozlowski told journalists that the FTA was a "win-win" agreement and would be a model for others that the EU is negotiating in the region.

Apart from multiplying the flow of goods and services, the agreement would "boost exchange of ideas, exchange of people and culture, and ultimately will bring Korea and the EU much closer", he said.

Kozlowski said some studies forecast the FTA would boost trade by 50 percent in the short term and more than double it over the next two decades.

One study forecast more than 250,000 new jobs in South Korea in the long term as a result of the pact.

The deal would "have a wide impact in Asia and in the world", Kozlowski told a news conference Thursday. "It shows the potential for increasing growth and jobs through greater trade between Europe and Asia."

He wrote to the Korea Herald published Friday that the "landmark" deal was the "most ambitious ever FTA negotiated by the EU with a partner outside Europe and the first FTA with a country in Asia."

The pact will bring about yearly savings of more than two billion euros in tariffs, he said.

It will also remove non-tariff barriers, especially those in automotive, electronics and pharmaceutical sectors and consolidate the liberalisation of the service industries, he said.

Some studies suggest the South Korean car and electronic sectors will benefit from access to the EU market of 500 million consumers, others point to likely increased sales of EU industrial machines and luxury goods in South Korea, he added.

The Federation of Korean Industries, a lobbying arm of large businesses, and the Korea International Trade Association, an umbrella group of local trading firms, expressed hope the FTA would boost South Korea's market share in the EU.

South Korea's market share in the EU stood at 1.0 percent, compared with China's 7.1 percent, they noted.

But all are not winners. South Korea's government has announced a plan to funnel $19.8 billion into the agricultural and fisheries industries to help cushion the impact from the deal.

South Korea also signed a free trade agreement with the United States in 2007 but the pact has yet to be ratified by the two countries' legislatures.

US ambassador to Seoul Kathleen Stephens warned last month that US exporters could lose ground to European competitors unless Congress quickly ratifies the agreement.