They drove to Washington in hybrid vehicles

Three big US carmakers asked the Congress to renew their plea for an enormous $34 billion government bailout to save their vital industry from a possible collapse. Ford said it might pull through on its own and return to profitability by 2011, but asked for a $9 billion line of credit in case the economy worsens or one of its competitors fails. GM asked for $4 billion this month and another $14 billion next year and Chrysler said it needed $7 billion by December 31, 2008 if they were to survive a perfect storm of a global credit crisis, falling demand for large vehicles and a global economic slump.

An estimated three million jobs and a potential crash of the US economy are at stake as General Motors and Chrysler warn that they could run out of cash within a matter of weeks if they are not given access to billions in low-cost, government-backed loans. Neither automaker expects they would be able to survive if they were forced into bankruptcy protection and the ripple effects of their failure would be felt across the country as auto supplies and related companies collapse in the wake of a sudden loss of business. The White House said it was reviewing the three different plans and was open to a possible aid package, but cautioned not to expect any decisions in the coming days.

Lawmakers turned the three chief executives away empty-handed last month and charged them with coming up with proper plans showing they would be able to repay the loans and attain long-term viability. They were roundly criticised for letting their iconic brands crumble in the face of competition from foreign transplants, whose US plants operate at much lower costs, and failing to develop smaller fuel-efficient cars.

There was also anger that all three had flown to Washington for the hearings in separate corporate jets – more proof of the excesses of the CEO lifestyle. This time, they drove to Washington in hybrid vehicles.

Ford and GM will get rid of their company airplanes and all three chief executives will work for salaries of one dollar a year. All three put forward plans to invest billions in advanced technology, shift their product mix towards more environmentally friendly vehicles and slash operating costs.

Auto workers also offered to share in the sacrifice, despite landmark concessions made last year which have taken billions of dollars in health care liability off the books of the Big Three and will bring labor costs in line with the non-unionised US plants of foreign rivals by 2012.

Industry data showed that auto sales dropped 37 per cent last month, as total US sales fell to 746,789 from nearly 1.2 million vehicles in November 2007.

Myanmar: ‘Humanity’ and ‘Business’ are two separate issues

Despite global annoyance over Myanmar’s bloody crackdown on the Buddhist monks and dissents, multinational firms are still competing and racing to grab contracts on the country’s rich natural resources. This move by the multinationals is actually throwing an economic lifeline to the military regime which is otherwise facing a serious threat from the general people.

Multinational firms from China, South Korea, India and Thailand are looking to exploit the energy resources of Myanmar. US based energy giant Chevron, French oil group Total and China’s top oil producer, China National Petroleum Corporation are among the companies giving much needed income to the Myanmar’s autocratic government. Currently, France’s Total and Malaysian Petroliam Nasional Bhd, pump gas from fields off Myanmar’s coast through a pipeline to Thailand, which takes 90 % of Myanmar’s total gas output. Recently, Indian Oil Minister Murli Deora was in Yangon, for signing contracts between Indian ONGC Videsh and Myanmar’s military rulers to explore three offshore blocks.

Altogether, nine foreign oil companies are involved in 16 oil and gas blocks of the country. These petroleum corporations offer economic support to the country’s repressive junta, and in some cases are complicit in human rights abuses. According to the US legal director of Earth Rights International, “They are funding the dictatorship”. “The oil and gas companies have been one of the major industries keeping the regime in power”. Co-coordinator of the Alternative ASEAN Network, Debbie Stothard said “All these profits go to the regime”. He added “these companies don’t care about human rights and what is going on in Yangon”.

Japan’s Nippon Oil Corp, South Korea’s Daewoo International, Malaysia’s state-run Petronas and two Indian power giants, Gail India and Oil and Natural Gas Corp, are also racing for new billion-dollar contracts. Japan’s Nippon Oil said, there would be no change in its Myanmar operations following the crackdown on demonstrations. It said that it sees the political situation and energy business as separate matters.

Last week, French President Nicolas Sarkozy urged his country’s businesses, including Total, to freeze their investments in the impoverished nation, which has been ruled by the military since 1962. Total has a 31% stake in Myanmar’s major Yadana project, which would carry gas from fields in the Andaman Sea to power plants in Thailand. Total has not yet made any public announcement on the issue.

One more time, these blood eating multinationals have proved that ‘Humanity’ and ‘Business’ are actually two separate issues.

India – 77% people lives below the poverty line

A recent government report said “seventy-seven percent of Indians, about 836 million people, live on less than half a dollar a day. India is considered as one of the hottest economies of the world but now it seems, it needs to do something about the enormous inequalities.

The report entitled “Conditions of Work and Promotion of Livelihoods in the Unorganized Sector” by the state-run National Commission for Enterprises in the Unorganized Sector (NCEUS) said, most of those living on below 50 US cents per day were from the informal labor sector with no job or social security, living in abject poverty. For most of them, conditions of work are utterly deplorable and livelihood options extremely few.

According to the report, based on data from 2004-2005, 92 percent of India’s total workforce of 457 million were employed as agricultural laborers and farmers, or in jobs such as working in quarries, brick kilns or as street vendors. The report said, “such a sordid picture co-exists uneasily with a shining India that has successfully confronted the challenge of globalization powered by economic competition both within the country and across the world.”

Around 26 percent of India’s population lives below the poverty line. Economic liberalization since the early 1990s has created a 300 million-strong middle class and led to an average annual economic growth of 8.6 percent over the last four years, but millions of the country’s poor remain untouched by the boom. The report said the majority of those working and living under “miserable conditions” were lower castes, tribal people and Muslims and the most disadvantaged of these were women, migrant workers and children.

Singapore attracts shipping firms

Singapore became the hottest destination for Indian shipping companies. The tax-friendly regime in Singapore is encouraging domestic shipping companies to acquire vessels through their subsidiaries in that country. Shipping majors are also queuing up to raise finance in Singapore. Mumbai-based Mercator Lines has signed an agreement with an overseas company for acquiring four dry bulk ships through Mercator Lines (Singapore) Pte at an estimated investment of Rs 1,000 crore.

Varun Shipping Company, which specialises in LPG transportation, is also planning vessel acquisition through its Singapore subsidiary.Tolani Shipping has already moved all its ships under the Singapore flag owing to the tax burden faced by shipping companies in India.  Though the country’s largest private shipping company, GE Shipping, has a subsidiary in Singapore, all its vessels are plying under the Indian flag.

However, GE Shipping executives had earlier warned that it will flag out vessels to other countries as multiple taxes in India had made business uncompetitive. “Indian shipping companies are exposed to 12 taxes,” said a senior executive of the shipping company. An industry expert said Singapore levied only nominal tax as tonnage tax and it was also easy to set up a subsidiary there. Mercator’s Singapore subsidiary has also firmed up plans to float an initial public offering in that country. After the public issue, it will be listed on the Singapore Stock Exchange and the IPO proceeds would be used for fleet expansion under the Singapore flag. Sources said the company had finalised the investment bankers for the public issue which would hit the capital market shortly. When contacted, Mercator Lines executives declined to comment.

As a part of the proposed issue, Mercator Lines has raised $51 million through convertible bonds which are listed on the Singapore Stock Exchange. A senior Varun Shipping executive said the company was planning to acquire vessels through its Singapore subsidiary. Varun Shipping had filed a draft prospectus with Monetary Authority of Singapore to issue Singapore Depository Shares. However, considering the volatile stock conditions globally, it has put the issue on the back burner.

Indian airlines industry growing

India has an expanding economy. With the rising incomes and a large population of young people eager to travel, airlines are taking aggressive strategies to attract them for higher revenue. The emerging economy along with a travel minded youth class has made India the world’s fastest-growing and most competitive aviation market. Domestic passenger traffic is expected to double to 60 million by 2010 and reach 200 million by 2020. Currently, some 650 air flights take off daily from India’s 95 operational airports; this rate was only 200 three years ago. That figure is likely to nearly double to 1,200 by 2010.

Industry consolidation started rolling ever since a crop of eight new airlines hit the Indian skies in the last three years. Most were budget carriers set up by entrepreneurs who quickly placed tremendous downward pressure on fare prices. They all have been chasing the estimated 300 million middle-class Indians who have been enjoying rising disposable incomes and now have the financial wherewithal to travel at home and abroad. The lucrative market also encouraged merger of the state-run domestic and international carriers—Indian Airlines and Air India. Chennai-based business carrier Paramount Airways plans to acquire a substantial stake in GoAir, another no-frills budget carrier. Among India’s passenger carriers, however, the outlook is challenging as long as the fare wars continue. Discounted tickets represent 20% of total fares in India vs. a global average about 10% to 15%. On top of that, the scarcity of airports in India has meant higher landing and maintenance fees, another drag on profits.

Major international aircraft manufacturers such as Boeing, Airbus, ATR, and Brazil’s Embraer are knocking to win orders. Boeing plans to increase sales of its 125-aircraft fleet by double by 2011. If so, that would mean about a $20 billion revenue haul for Boeing. With more than 100 Airbus planes operating in India, the European concern’s new orders have come from startup airlines such as Air Deccan, Kingfisher, Spice Jet, and GoAir.

Indian skies are now so congested that it’s not unusual for passenger jets to spend an hour circling around an airport and waiting for a landing slot, which drives up the fuel costs even on short-haul trips and adds up to 10% in additional costs.

The three consolidated groups Air India, Jet Airways, and Kingfisher dominate the Indian skies with an 85% market share. Other low-cost carriers could be in play soon. Needs for engineering, maintenance and repair, ground services, and route networking and planning has come up. Indian authorities should respond quickly to smooth up the flying of the airlines so that the industry can grow as expected.

Coca cultivation in Latin America

Areas of coca cultivation grew in Peru and Bolivia last year but decreased in Colombia, a report by the United Nations Office on Drugs and Crime said. According to the report, cultivation of coca grew eight percent in Bolivia and seven percent in Peru but fell in Colombia by nine percent; which looked at cultivation in the Andes, the main cocaine-producing region in the world. A total 156,900 hectares were used to grow the plant last year in the region, down from 159,600 in 2005 a 2% drop – the report concluded.

On the whole, demand for cocaine has remained steady throughout the world, with a slight increase in Europe offset by a decline in the US.

Even, since 2000, coca cultivation in the Andean region has fallen by almost 30 percent to 158,000 hectares. This is a dramatic decline, and a signal that governments and farmers are committed to eliminating drug cultivation. Though in the Andean region, the struggle is still on between, on one side governments and citizens committed to legitimate industry and prosperity, and on the other side, narco-traffickers intent on preserving the status quo.

Despite observing a decreasing tendency, Colombia is a leading producer of coca and much of the country’s coca is grown by poor farmers because it generates more income than any other crop. According to the director of Amazon Institute of Scientific Investigation, 1.8 million hectares of rainforest in Colombia have been destroyed to make room for drug plantations.  Government has long battled a cocaine-fueled insurgency in its remote regions. In an effort to destroy the rebels’ chief source of income, the Colombian government has targeted coca fields with aerial spraying of herbicides. Coca provides the key ingredient in cocaine and its eradication is a fundamental part of the US-backed war on drugs. But despite a lower area of cultivation and efforts by local law enforcement agencies to destroy clandestine laboratories and seize merchandise, Colombia remains the world’s biggest coca grower and is responsible for 62 percent of the world’s supply of cocaine.

Reducing coca cultivation requires tackling other aspects of the drug trade, including cutting supply and demand and halting trafficking. Measures taken in Peru to tackle coca production paid off. All Andean countries require greater support for development assistance that can generate growth and create brighter prospects for communities at the beginning of the supply chain.

While the coca plant can be found throughout most of Latin America, varieties containing the cocaine alkaloid are cultivated and converted primarily in Peru, Bolivia and Colombia. While methods of cultivating the coca plant are similar in many ways throughout Peru, Bolivia, and Colombia, there are differences in techniques because of terrain, tradition, and other factors.

Drug trafficking – Mexico’s growing cancer

Drug trafficking is bringing Mexican people an indescribable number of problems. Socially, politically and economically – the evil hand of drug trafficking is hampering at large. President Felipe Calderon may be the constitutionally elected leader of the nation, but in reality, drug cartels and warlords exercise vast authority over much of the area.

Calderon is now firmly installed as the president of Mexico, after having survived Andres Manuel Lopez Obrador’s strong post-electoral challenge. He has shown that he is ready to tackle his country’s major problems, which are organized crime and gross impunity. In reality, he is having a tough time.

Drug trafficking overpoweringly is the prevailing social problem throughout the country, particularly along the border with the US. In spite of lengthy declarations by government officials in Mexico City and Washington, and their insistence that important battles are being won against drug trafficking, criminal organizations like the Tijuana cartel continue to thrive, ruling over whole sections of the Mexican countryside.

The drug cartels continue to rule with no sure sign of their power decreasing anytime soon. Looking over a long history of disappointment and failure of the government in controlling this, it is unlikely to save for episodic and criminal activities are likely to decrease. To a great extent this is due to Mexico’s unrefined corruption and the fact that the nation’s institutions are not strong enough to stand up to threats, bribes, unremitting violence, and civic rectitude, when upward of 50 billions of tainted dollars are in play.

During the US President G. Bush’s two day stopover in Mexico in recent past, he wasted no time in praising the accomplishments of the Calderon administration in combating drug trafficking. Declarations made by Bush and Calderon should be seen as symbolic more than anything else. Both leaders likely realize that whatever initiatives taken to stop drug trafficking from Mexico into the US, including the recent operations by Mexican security forces as part of Calderon’s offensive on organized crime, have not succeeded to any marked degree in changing the course of the drug war in Mexico.

Dams in Brazil

In recent weeks, the Brazilian government decided to work on the difficult task of building giant hydroelectric dams in the Amazon River. The project presents President Luiz Inácio Lula da Silva with a major challenge between his ambitious economic development plan based on large-scale infrastructure, and the enormous social and environmental costs of the dams. On the one hand, dam construction plays a critical role in the government’s large-scale infrastructure initiative called the Program to Accelerate Growth (P.A.C.). The P.A.C. is a multi-year public works program designed to advance economic development by promoting incentives for infrastructure expansion, including building large dams in the Amazon. On the other hand, the president must confront the reality that the mega-projects in the Amazon could cause enormous and irreversible environmental and social impacts, and that they face considerable obstacles under Brazil’s demanding environmental laws.

The hot-button issue is the plan to build two large dams at the Santo Antônio and Jirau rapids on the Madeira River in the Amazonian state of Rondônia. The projects would dam the Amazon’s principal tributary, causing dramatic changes to the riverine ecology and affecting thousands of families who depend on the river for income, nutrition, and agriculture. With a combined generating capacity of 6,450megawatts, government energy planners insist the Madeira dams are essential to avoiding blackouts in the next decade. Yet following more than two years of analysis, Brazil’s environmental agency, IBAMA, recently issued a finding that it cannot give the go-ahead for the controversial project, citing insufficient information with which to make a decision.

The Brazilian electric sector has launched a torrent of criticism against the environment minister, claiming that IBAMA is holding up Brazil’s development. The project’s effects on Bolivia could eventually block the project from moving ahead. Brazilian government officials (other than IBAMA) have tried to ignore the fact that for Brazil to build a dam that floods the territory of a neighboring country would require negotiating a complex set of treaties, in the absence of which Brazil would be guilty of violating international law. In addition to serious questions regarding the project’s environmental feasibility, Brazil may have trouble attracting sufficient private investment in the project due to questions about its economic viability.

Originally proposed as a source of cheap energy for the national grid, the project’s budget continues to grow. The latest estimate by the Brazilian Electrical Agency, Agência Nacional de Energia Elétrica (ANEEL), sets the cost for the Santo Antônio and Jirau dams at $13.2 billion, not including the additional cost—estimated by the government at up to $7.5 billion—of constructing 2,400 kilometers of transmission lines to connect with the central electricity grid. It also doesn’t include the costs of navigation locks, and the costs of building upstream dams to flood a series of rapids, making it possible for barges to travel from the mouth of the Amazon to the upper stretches of the Madeira’s tributaries.

President Lula faces a major dilemma with these dams plan and so far has responded with frustration and cynicism.

Canada installs eight new radiation scanners

Canada installed eight new radiation scanners at Montreal ports to prevent terrorist attacks. The scanners, which will check about 1,200 containers that come into the port each day for radioactive substances that can be used in terrorist attacks. The same equipment has been in place in other Canadian ports like Vancouver and Halifax. A total of 36 will be installed across the country, with each costing up to 198,000.

The radiation detection program was a key part of the former Liberal government’s $172-million plan to beef up marine security after the 2001 terrorist attacks.

Critics of such instalment said, smuggling of drugs and contraband are far greater problems at Canadian ports rather then radioactive substances. This ctitic gets support from the history as Canada’s spy agency hardly ever collected enough details to categorize any terrorist threat as a “specific” one leading up to the 1985 Air-India bombing.

Can Indonesia do it?

Neighboring yet not so friendly Indonesia and Singapore signed a long waited and desired extradition treaty in April 2007. Indonesia in particular expects a lot done with help of this treaty including bringing back fugitive corruptors and retrieving the ill-gotten money that has been passed on to Singapore during the Asian financial crisis in 1997-1998.

Signing of this treaty has been described as a breakthrough of President Susilo Bambang Yudhonono by the Indonesian media as the country has been trying to conclude an extradition treaty with Singapore for over three decades. The Susilo government is viewed as successful in convincing Singapore of its seriousness to crack down on corruption and money laundering. The treaty signed on the resort island of Bali covers 31 crimes including corruption, banking offences and terrorism as well as its funding.

People’s Consultative Assembly and House of Representatives were the only two of many quarters who called for an imminent implementation of the agreement. Hope for the use of the extradition treaty momentum to arrest fugitive corruptors was also raised by many quarters. As long as the treaty is based on cooperation, all can be optimistic that it will be an effective means to force corrupters who had fled from Indonesia to return and surely an expression of optimism is present and all expects that the treaty eventually comes handy to both the countries. Political experts said, if implemented well, the extradition will benefit not only Indonesia but Singapore as well; the pact would improve Singapore’s credibility because by the agreement it would look cleaner and more credible in the eyes of the law and to the international community.

Singapore is for long an alleged money laundering center for corrupt businesspeople including wealthy Indonesians. One-third of the tycoons in the Singaporean banking and real estate sectors are actually from Indonesia, whose assets are deemed to amount to $87 billion; some of these are even Indonesia’s most notorious fugitives. Tempo magazine reported in October 2007 that for a long time Singapore had been a refuge for ‘problem’ business people from Indonesia. It quoted data from the Indonesian embassy in Singapore that some 200 debtors who owned money to the state were hiding in this tiny nation since the fall of the Soeharto administration in 1998. According to Tempo, the number of rich people in Singapore in 2005 grew by 13.4 percent to 55,000, with a total wealth of around US$260 billion. About one-third, or 18,000, of them are Indonesian citizens.

Success of the treaty remains in the hand of political experts and related ministries. For the start, Indonesia can recover funds deposited in Singapore by those who were convicted by its courts while the amount of funds hidden by fugitives yet to be convicted is still being calculated.

The defence pact will remain in force for 25 years.