Sri Lanka growth slows to 1.8 pc in first half

Sri Lanka's economy grew 1.8 percent year on year in the first half
of 2009 , dragged down by weak demand for clothing and tea, official
data showed Monday. The figure contrasted with 6.6 percent
expansion in the first half of 2008 , but analysts expect an economic
revival after government forces crushed the Tamil Tiger rebels in May
following nearly four decades of conflict. "The impact of the global
downturn reduced demand for our exports and resulted in this
reversal," deputy director of the Department of Census and
Statistics, Nalini Kumarasinghe, told reporters. The war-battered
economy slowed to 2.1 percent in the second quarter, from 7.0
percent in the same period a year earlier, as the services sector
including banks, shipping and telecom were slow to recover. The
sector slowed to 1.1 percent in the second quarter compared to 6.5
percent at the same point last year. Agriculture grew 4.4 percent,
from 7.4 percent the previous year, while industrial output
expanded 3.0 percent, against 6.9 percent a year earlier. Sri
Lanka's central bank has raised year-end economic targets to between
four and five percent, from 2.5 percent to 3.0 percent, after the
Tigers were defeated. "We expect full year 2009 forecast to be around
4.5 percent, driven by economic activity in construction, trade and
tourism," said Yohan Seimon, an analyst at John Keells Stockbrokers.

UAE delays $41 b nuclear plants contract

The UAE has delayed awarding a 41 billion dollar contract to build
nuclear power plants saying that the decision between the three rival
bidders was too close to call, an Abu Dhabi daily said Monday. "What
happened ultimately was some of the bids were so close in some areas,
we decided to proceed with all three," a senior government official
told The National. "It will mean a slightly longer period of
negotiations." The decision on the contract, which was due to be
awarded this Wednesday, will not come out until the end of the month,
the newspaper reported, citing an unidentified diplomat. A French
group led by Areva, Electricite de France, GDF Suez and Total is
competing against a Japanese-American alliance of Hitachi and General
Electric, and a Korean-American consortium comprising Korea Electric
Power, Samsung, Hyundai and US firm Westinghouse. The Arab world's
second-largest economy, the United Arab Emirates is seeking to reduce
its dependence on hydrocarbons for power generation and to boost its
image as an environmentally friendly country.

French firms keen on agro-food industry

French technology providers have shown interest in the rapidly
growing agro-based industries in Bangladesh. "We are ready to provide
French technologies and expertise to agro-food industry here," said
Timothee Mougeotte, area manager (Near & Middle East & South Asia) of
Adepta, at a roundtable at Lake Shore Hotel in Dhaka yesterday.
Adepta is a French association for the Development of Trade of
Agri-foods Products & Technologies. The Economic and Trade Department
of French embassy, Ubifranch (the French Agency for International
Business Development), France Bangladesh Chamber of Commerce &
Industry and Adepta organised the discussion. Representatives of
Bangladesh Agro-Processors Association and different local agro-food
manufacturers were present at the programme. Participants in the
discussion said agro-based industry is growing fast in Bangladesh
with an aim to tap both the domestic and global markets. Processed
food exports from Bangladesh increased almost fivefold to $46.68
million in fiscal 2008-09 from $10.46 million in fiscal 2005- 06 ,
luring new investment in the industry. Presently local agro-based
companies are mainly producing processed foods, spices and dairy
products. At the roundtable, two French companies -- Ets Charriau and
Sodime -- presented their technologies with focus on optimising milk
collection and agro-food manufacturing solutions.

Sarkozy threatens to walk out of G20

French President Nicolas Sarkozy is ready to walk out of next week's
G20 summit if no progress is achieved on curbing bankers' bonuses,
his chief of staff said Monday. "There must absolutely be an agreement
to make things change and the president is absolutely determined on
that score," said Claude Gueant, the secretary general of the
Elysee, on RTL radio. Sarkozy will be leading a charge for tough curbs
on bonus payments for bankers at the G20 meeting of the world's
major economies in the US city of Pittsburg on September 24 and 25.
France argues that the big payouts reward the risk-taking that led to
the 2008 financial meltdown. Already, at the G20 summit in London
in April, Sarkozy had threatened to storm out of the gathering and
later credited this threat for an agreement on steps to clamp down on
tax havens. Sarkozy's proposals for capping bankers' bonuses has won
support in the European Union but Britain and the United States have
voiced reservations.

Taiwan looks to China financial pact in October

Taiwan plans to sign an agreement with China in October that will
allow some of the mainland's huge pool of liquidity to start flowing
into the island's stockmarket, local media said Monday.
Representatives from the two sides could sign the memorandum of
understanding in Taiwan, China or Hong Kong, the Commercial Times
said, citing unnamed sources. Once it is signed, Chinese
institutional investors will be allowed to buy shares on the Taiwan
Stock Exchange, which has so far been closed to Chinese money,
according to the paper. banks will also be permitted to upgrade their
representative offices in China to branch status, meaning they can
start engaging in business for profit. Meanwhile, the Economic Daily
News reported that Taiwan expects to kick off negotiations on a
separate trade agreement with China in October. The island's new
premier Wu Den-yih, who took office last week, has asked his Cabinet
to prepares for negotiations on the pact, known as the Economic
Cooperation Framework Agreement, the paper said. Taiwan is waiting to
hear from China if it agrees to holding talks next month, the report
said. The pact is seen as key in maintaining Taiwan competitiveness
in the Chinese market at a time when other economies in the region are
all negotiating free-trade agreements with Beijing. Officials from
the economics ministry and government information office declined
comment when asked Monday to confirm the reports. President Ma
Ying-jeou of the China-friendly Kuomintang was voted to power last
year on a promise to bring about a better relationship with China,
which is increasingly seen as holding the key to the island's
economic future. Wu became premier in a cabinet reshuffle last week
after his predecessor resigned over criticism against the government
response to Typhoon Morakot in early August which left more than 600
people dead.