The New Nation - Internet Edition

Staff Reporter

The country's export earnings declined by 11.69 percent during the first two months of the current fiscal comparing with the performance of the corresponding period of the last fiscal, according to a report of Export Promotion Bureau. The country exported products, the report says, worth 2.3 billion dollar against the strategic target of 2.64 billion dollar, short by 23.06 percent.

Exporters blame the prolonged political violence beginning from October 2006, unrest in the RMG sector fuelling from July 2006, congestion of containers in the Chittagong Port and hate-campaign against Bangladesh abroad for sharp fall in exports. The EPB has raised the strategic target to 14.5 billion dollar for the fiscal year of 2007-08 from 12.5 billion dollar though the country was not able to achieve the target. It is because both the woven garments and the knitwear exports fell behind the target.

The BGMEA leaders, despite plummet, appear optimistic about receiving a bulk of fresh orders from the buyers in the months to come. But the real story is that this optimism may suffer a setback due to some clauses incorporated in the proposed US garment bill. From a story published in this paper on Wednesday, it appears that LDC countries like Bangladesh and Cambodia will face difficulties in getting free entry to the US market. In view of this, the BGMEA president has urged the government and other stakeholders to treat the matter with utmost care in order to get free access in the US market. However, if all the efforts to persuade the US lawmakers from passing the said bill fail, the RMG exports to the USA will be seriously jeopardized. It is noticeable that the USA alone imports 28 percent of garment products from Bangladesh.

Export earnings from woven garments declined by 16.59 percent because of exports worth 762.22 m $ products in July-August period while the knitwear earnings were 791.79 million dollar against the strategic target of 995.72 million dollar. Not only the RMG sector; jute goods, leather, pharmaceuticals, handicrafts, home textile and tobacco also marked sharp decline though vegetables, raw jute and frozen goods performed well during this period.

Economic development of a country largely relates to political stability, high-quality planning and good bilateral relationship. Since the beginnings of the nineties, frequent shutdown call and siege program damaged the country's image abroad. Unless political stability is established in Bangladesh and politics of hartal and siege are abandoned, economic development is really hard to achieve.

AFP, Singapore

Oil prices scaled record highs of more than 95 dollars a barrel in Asian trade on Thursday after the Federal Reserve lowered interest rates and following news of a surprise decline in US crude stocks. New York's main futures contract, light sweet crude for delivery in December, was trading at 95.26 dollars a barrel, up 73 cents from its close of 94.53 dollars a barrel in US trades, and smashing Wednesday's record of 94.74 dollars.

The New York contract earlier surged to an all-time intraday summit of 95.80 dollars.

Brent North Sea crude for December delivery also erased the previous day's intra-day high of 90.94 dollars to trade at 91.10 dollars, up 47 cents.

"The increase in oil prices was driven by the release of the US Energy Information Administration's Weekly Petroleum Status report, which showed a large decline in US crude oil inventories," Australia's Commonwealth Bank said.

Oil prices, which had earlier slumped below 90 dollars on Wednesday, staged a blistering rally after the Federal Reserve cut key US interest rates by a quarter of a percentage point to 4.50 percent.

The cut is targeted to boost domestic consumption in the world's biggest economy and cushion the impact of a crisis in the US subprime mortage housing market which has been rocked by defaults. A healthy US economy prompts higher demand for oil.

Oil prices also rose after the US Department of Energy's (DoE) weekly snapshot of energy reserves showed that crude inventories tumbled by 3.9 million barrels to stand at 312.7 million barrels in the week ended October 26.

That shocked the market because consensus forecasts had been for a gain of 400,000 barrels in the reserves of the world's biggest energy consumer and underscored a tight supply situation.

Xinhua, Beijing

China will raise the prices of gasoline, diesel oil and aviation kerosene by 500 yuan per ton, almost a 10 percent rise, starting from November 1, China's economic planner announced on Wednesday.

The average retail prices of gasoline and diesel oil was lifted to 5,980 and 5,520 yuan per ton from 5,480 and 5020 yuan.

The adjustment was made to shorten the gap between high- flying international crude prices and state-set domestic oil prices, according to the National Development and Reform Commission. The government-controlled oil prices in domestic market had been blamed for a shortfall of oil supply, as some refineries would stop processing to avoid losses while some producers and dealers would hoard up oil to gain more profits in the case of possible price hikes, said Liu Zhenqiu, vice director of the price department of the NDRC.

Crude price in international market has reached 93.53 U.S. dollars per barrel on October 29, up over 80 percent from the price at the beginning of the year.

"If the crude price is 80 U.S. dollars per barrel, domestic refineries will lose 600 yuan for each ton of crude they process, and 1,000 yuan for each ton of oil they produce," said Liu. To increase oil supply and keep the domestic market stable, China National Petroleum Corporation (CNPC) and China Petroleum and Chemical Corporation (Sinopec) ordered their refineries to work almost full power. CNPC pushed up its processed oil output by nearly 10 percent in the third quarter compared with the same period last year.

After importing 60,000 tons of gasoline in September and 90,000 tons of diesel oil in October, Sinopec said it planned to buy more diesel oil in November to relieve the tightened domestic demand. CNPC also imported 200,000 tons of gasoline and diesel oil to the coastal market in the third quarter, and tuned down oil export.

Reuters, Beijing

China may have joined the World Trade Organisation and it may be rapidly opening its banking sector to foreigners, but when it comes to politics, the teachings of Karl Marx are still top dog.

In a front-page story in Thursday's Financial News, published by the central People's Bank of China, chief banking regulator Liu Mingkang urged his officials in untypically turgid language to study Communist Party theory and Marxism.

"Party members must t promote the study of Marxism which combines theory with practice," Liu told Party members at the banking regulator. "Liberate thinking, seek truth from the facts.

"Continue to raise the development of Marxism," added Liu, whose polished English and cosmopolitan ways usually stand out in marked contrast with many other senior Chinese officials.

Not wishing to be left out, the Agricultural Bank of China, one of the country's "big four" state-owned banks, had also ordered its employees to study politics, the same newspaper reported.

"Agricultural Bank plans in an all-round way to study and implement the spirit of the 17th Party Congress," declared the headline, refering to a just-concluded Party meeting, which happens once every five years.

China's Communist Party has ruled with an iron hand since winning power in a revolution in 1949 and brooks little dissent.

While in recent years it has embarked upon major economic reforms, termed "socialism with Chinese characteristics", Communism is still officially the state creed, and the Party's tentacles reach into almost every facet of business life.

But officials say there is no contradiction.

Last week, the chairman and party boss of China Construction Bank, Guo Shuqing, said one way to put the latest Chinese Communist principles into practice was to maximise returns for shareholders.

AFP, Hanoi

The World Bank on Thursday improved funding access for Vietnam, placing it within the ranks of middle income countries due to good development progress and increasing credit worthiness.

World Bank country director Ajay Chhibber said Vietnam could access the International Bank for Reconstruction and Development (IBRD) for financing poverty reduction which will supplement existing schemes.

"More support from the WB (World Bank) will help Vietnam achieve its growth in the future t in an inclusive and sustainable manner," Chhibber said.

The country, which became a member of the World Trade Organisation in January, has seen sustained annual economic growth rates of more than eight percent.

Vietnamese Prime Minister Nguyen Tan Dung said in October he expected the country's GDP per capita would reach 960 dollars next year, higher than the predicted 835 dollars for 2007.

Muhammad Ali has been appointed Managing Director of Shahjalal Islami Bank Limited.

Prior to taking over the new assignment, Muhammad Ali worked as Managing Director (Current Charge) of the bank since 1st August 2007. He joined Shahjalal Islami Bank Limited as Senior Vice President on 24th July 2005 and was promoted as Deputy Managing Director (DMD) on 1st January 2006.

After successful completion of post graduation with honours in Economics Mr. Ali started his career in Sonali Bank in 1977 as Probationary Officer grade-V after being selected by Bankers' Recruitment Committee.

AFP, New York

The price of gold passed 800 dollars an ounce in New York on Wednesday for the first time since 1980 after the US Federal Reserve lowered its key short-term interest rate, the New York Mercantile Exchange said.

Gold futures for December touched 800.80 dollars on the exchange (NYMEX) after the Fed made the cut amid a persistent housing slump and fears of inflation spurred by record high crude oil prices.

The Fed, in a widely expected decision, cut its short-term federal funds interest rate by a quarter of a percentage point to 4.50 percent.

Gold prices have jumped by about a third in value over the past year. The metal benefits from a weak US dollar as it makes commodities that are priced in dollars cheaper for buyers using stronger currencies.

Higher oil prices spark inflationary concerns, while gold is regarded as a haven in troubled times.

Its all-time record high price stands at exactly 850 dollars an ounce, reached on January 21, 1980.

AFP, Sydney

Australia's dollar soared to 23- year highs on Thursday on the back of a US interest rate cut and domestic data that heightened expectations Australian rates will rise as early as next week.

The Australian dollar reached 93.42 US cents in early trading Thursday, its highest level since the currency was floated in 1984, before settling back to 93.14 US cents at 1700 (0600 GMT).

Dealers said the US rate cut had widened the gap between US and Australian interest rates, making the currency more attractive to investors. They said strong retail figures out today had also reinforced inflation fears, making it more likely Australia's Reserve Bank will lift interest rates next week and make the interest rate differential even broader.

Westpac chief executive David Morgan said he believed there could be two more Australian interest rate rises in the current economic cycle. Commonwealth Bank chief currency strategist Richard Grace said further rate hikes could see the Australian dollar reach parity with its US counterpart. Apart from the interest rate differential, Grace said favorable terms of trade plus robust commodity prices were underpinning the Australian dollar.

"A return of confidence and fundamental drivers should see the Australian dollar exchange rate undertake an upward adjustment to reflect the 50-year high in Australia's terms of trade," he said.

Official figures showed retail sales rose for a fourth straight month in September, climbing 0.8 percent to 19.86 billion dollars (18.46 US). Macquarie Bank senior economist Brian Redican said the result was "incredibly strong", well above the expected 0.5 percent, and showed Australian shoppers had ignored an 0.25 percent rate rise in August. While the surging currency has been a boon for Australian consumers snapping up cheaper imports, analysts say it will force businesses to increase their competitiveness if they want to maintain an edge in export markets.

Trade figures also released today showed exports fell four percent in September dive in adjusted terms, while imports fell three percent.