Business

The business plan

noreply@blogger.com (KHALED TAHKOUBIT) — Fri, 26 Dec 2014 01:15:00 -0800

OBJECTIVE: The business plan is the key ingredient for a successful business and is often ignored. This session shows you how to create an individualized business plan, and provides the tools to make it easy.

What is a Business Plan?

Why prepare a business plan?
What to avoid in your business plan

Business Plan Format

Vision statement
The people
Business profile
Economic assessment

Eight Steps to a Great Business Plan

Review sample plans
Focus and refine concept
Gather data
Outline the specifics of your business
Include experience
Review language and projections
Put your plan into a compelling form
Enhance with graphics

Does Your Plan Include the Following Necessary Factors

A sound business concept
Understanding your market
Healthy, growing and stable industry
Capable management
Able financial control
Consistent business focus
Mind set to anticipate change
Plans for online business

Formulate (and Reformulate) Your Business Plan
Top Ten Do's and Don'ts

What Is A Business Plan?

The primary value of your business plan will be to create a written outline that evaluates all aspects of the economic viability of your business venture including a description and analysis of your business prospects. We believe that preparing and maintaining a business plan is important for any business regardless of its size or nature. But it will not ensure your success. If you maintain a correct assessment of the changing economics of your business, your plan will provide a useful roadmap as well as a financing tool. But if you have miscalculated the potential, then your business plan could become a roadmap leading to failure.

Since the My Own Business, Inc. course is broken down into fifteen of the most important topics to consider in starting or operating a business, your business plan can easily be organized into this same format. Included in this session, and in each of the following sessions, there is a one-page business plan template, which you can fill in and print. (Session 2 contains templates for both Sessions 1 and 2.) When you put these all together, you will have completed your personalized, overall plan.

Search engines, libraries and bookstores provide sources that sell ready-made plans for specific businesses. But it is our recommendation that you be sole author of your plan. Write out the plan yourself, in your own words.

Each of the Business Plan Sections can be downloaded from our Web site and provide you with a single, attractively presented document.

Keep in mind that creating a business plan is an essential step for any prudent entrepreneur to take, regardless of the size of the business. This step is too often skipped, but we have made it easy for you by providing this ready format to build your plan as you progress through this course.

Be aware now that most start-up entrepreneurs are reluctant to write down their business plan. It is, therefore, strongly recommended that you complete each segment of the plan as you progress through this course. We make it easy for you by providing sample plans for both product and service businesses and also an attractive blank form that you can download onto MS Word and customize yourself.

Do not expect that all of your plan's initial assumptions will be correct. Instead, look at your business plan as an ongoing assessment that you will frequently review and change to conform to actual operating experiences. For example, your cash flow projection should be updated frequently to ensure ongoing liquidity (not running out of cash).

Your business plan will become your roadmap to chart the course of your business. But at the outset you cannot predict all of changing conditions that will surface. So after you have opened for business, it is important that you periodically review and update you plan.

Why Prepare A Business Plan?
Your business plan is going to be useful in a number of ways.

First and foremost, it will define and focus your objective using appropriate information and analysis.

You can use it as a selling tool in dealing with important relationships including your lenders, investors and banks.

Your business plan can uncover omissions and/or weaknesses in your planning process.

You can use the plan to solicit opinions and advice from people, including those in your intended field of business, who will freely give you invaluable advice. Too often, entrepreneurs forge ahead ("My Way!") without the benefit of input from experts who could save them from potentially disastrous mistakes. "My Way" is a great song, but in practice can result in unnecessary hardships. To help get started in lining up appointments, you can fill in and use the following template. We have also provided a larger blank template for you to use at the end of this session. People to see include your investors, family members, banker, lawyer, attorney, business mentors, trusted business friends, potential customers, competitors (distant ones), potential landlords, and the U.S. Small Business Administration.

What to Avoid in Your Business Plan

Place some reasonable limits on long-term, future projections. (Long-term means over one year.) Better to stick with short-term objectives and modify the plan as your business progresses. Too often, long-range planning becomes meaningless because the reality of your business can be different from your initial concept.

Avoid optimism. In fact, to offset optimism, be extremely conservative in predicting capital requirements, timelines, sales and profits. Few business plans correctly anticipate how much money and time will be required.

Avoid language or explanations that are difficult to understand. Do not ignore spelling out what your strategies will be in the event of business adversities.

Don't depend entirely on the uniqueness of your business or even a patented invention. Success comes to those who start businesses with great economics and not necessarily great inventions.

Business Plan Format

The Business Plan format is a systematic assessment of all the factors critical to your business purpose and goals. Here are some suggested topics you can tailor into your plan:

A Vision Statement: This will be a concise outline of your business purpose and goals.

The People: By far, the most important ingredient for your success will be yourself. Focus on how your prior experiences will be applicable to your new business. Prepare a résumé of yourself and one for each person who will be involved with you in starting the business. Be factual and avoid hype. This part of your Business Plan will be read very carefully by those with whom you will be having relationships, including lenders, investors and vendors. Templates for preparing résumés are available in your library, Kinko's, bookstores and the Internet under " résumés."

Session 2 of our Business Expansion course, Getting your team in place, provides detailed recommendations on delegating authority, employee motivation, training and other key management tools.

However, you cannot be someone who you are not. If you lack the ability to perform a key function, include this in your business plan. For example, if you lack the ability to train staff, include an explanation how you will compensate for this deficiency. You could add a partner to your plan (discussed in Section 4) or plan to hire key people who will provide skills you don't have. Include biographies of all your intended management.

Your Business Profile: Define and describe your intended business and exactly how you plan to go about it. Try to stay focused on the specialized market you intend to serve. As a rule, specialists do better than non-specialists.

Economic Assessment: Provide a complete assessment of the economic environment in which your business will become a part. Explain how your business will be appropriate for the regulatory agencies and demographics with which you will be dealing. If appropriate, provide demographic studies and traffic flow data normally available from local planning departments.

Cash Flow Assessment: Include a one-year cash flow that will incorporate your capital requirements (covered in Session 11). Include your assessment of what could go wrong and how you would plan to handle problems.

Marketing Plan and Expansion Plans: Your expansion plan should describe how you plan to test markets and products before rolling out. Refer to helpful government Web sites such as the Small Business Administration. See "Resources" on the home page of this Web site.

Damage Control Plan: All businesses will experience episodes of distress. Survival will depend on how well you are prepared to cope with them. Your damage control plan should anticipate potential threats to your business and how you plan to overcome them. Here are three examples:

Plan for 35% loss of sales: During economic downturns, your survival will depend on your ability to maintain liquidity for a period of at least 12 months. Can your Damage Control cash flow plan show how to avoid running out of cash? Session 11 will explain cash flow control.

Plan for a catastrophic incident: Businesses can be overturned by unforeseen disasters which can be avoided by maintaining appropriate insurance. You will need the assistance of a qualified business insurance agent.

Plan for product obsolescence: If your business is in a rapidly changing technology area such as Netflix's home delivered DVDs, you will need to plan now to keep a step ahead of technical changes or advancements.

In addition, a very popular software is Palo Alto's Business Plan Pro (U.P. $99), a user-friendly business plan software with very wide range of sample plans already included. 10% off for MOBI users on Business Plan Pro here.

For a more advanced template, especially useful if you are looking for partners or investors, we recommend the Ultimate Business Plan Template (U.P. $97) from Growthink. We have negotiated a special 50% discount for MOBI users.

Eight Steps To A Great Business Plan

Start-up entrepreneurs often have difficulty writing out business plans. This discipline is going to help you in many ways so don't skip this planning tool! To make it easier, here are eight steps that will produce a worthwhile plan:

Review the two sample plans furnished in this session.
Focus and refine your concept based on the data you have compiled.
Gather all the data you can on the feasibility and the specifics of your business concept.
Outline the specifics of your business. Using a "what, where, why, how" approach might be useful.
Include your experience, education and personal information.
Fill in the templates at the end of each session with clear language and realistic projections.
Print off the business plan templates from each session into an MS Word document.
You may wish to enhance your presentation with bar charts, pie charts and graphics.

Does Your Plan Include the Following Necessary Factors

A Sound Business Concept: The single most common mistake made by entrepreneurs is not selecting the right business initially. The best way to learn about your prospective business is to work for someone else in that business before beginning your own. There can be a huge gap between your concept of a fine business and reality.

Understanding of Your Market: A good way to test your understanding is to test market your product or service before your start. You think you have a great kite that will capture the imagination of kite fliers throughout the world? Then craft some of them and try selling them first.

A Healthy, Growing and Stable Industry: Remember that some of the great inventions of all time, like airplanes and cars, did not result in economic benefit for many of those who tried to exploit these great advances. For example, the cumulative earnings of all airlines since Wilber Wright flew that first plane are less than zero. Success comes to those who find businesses with great economics and not necessarily great inventions or advances to mankind.

Capable Management: Look for people you like and admire, who have good ethical values, have complementary skills and are smarter than you. Plan to hire people who have the skills that you lack. Define your unique ability and seek out others who turn your weaknesses into strengths.

Able Financial Control: You will learn later the importance of becoming qualified in accounting, computer software and cash flow management. Most entrepreneurs do not come from accounting backgrounds and must go back to school to learn these skills. Would you bet your savings in a game where you don't know how to keep score? People mistakenly do it in business all the time.

Financial Management Skills: Build a qualified team to evaluate the best options for utilizing retained earnings. This information is contained in Session 6 of our Business Expansion course.

A Consistent Business Focus: As a rule, people who specialize in a product or service will do better than people who do not specialize. Focus your efforts on something that you can do so well that you will not be competing solely on the basis of price.

A Mind set to Anticipate Change: Don't commit yourself too early. Your first plan should be written in pencil, not in ink. Keep a fluid mind set and be aggressive in making revisions as warranted by changing circumstances and expanding knowledge.

Include Plans for Conducting Business Online: According to the January 2005 Trend/Forecasting Report of The Dilenschneider Group, in the U.S. alone, the 2004 holiday season online shopping jumped by more than 25% from 2003. (In 2005 it jumped another 25%!) Consumer and business-to-business online sales are set to expand exponentially in the coming decade, and small retailers can reach an ever-increasing pool of customers. Be sure to see the how-to details in the following Session 12, E-commerce.

Formulate (and Reformulate) Your Business Plan

Donald N. Sull, associate professor of management practice at the London Business School, in an article in the MIT Sloan Management Review, offers some practical suggestions on managing inevitable risks while pursuing opportunities. Here is a capsulation of his suggestions on how to formulate (and reformulate) your business plan:

Be flexible early in the process and keep it fluid. Don't commit too early. Expect your first plan to be provisional and subject to revision.
Ask yourself if your experience or expertise gives you the right to an opinion on your specific opportunity.
Identify your potential deal killers: variables that are likely to prove fatal to the venture.
Clearly identify what you see as the key drivers of success. What are you betting on here?
Raise money only in sufficient amount to finance the experiment or evaluation you next envision, with a cushion for contingencies.
Delay hiring key managers until initial rounds of experimentation have produced a stable business model.
At some point, take the plunge and test your product or service on a small scare in the real world through customer research, test marketing, or prototypes.
Test and refine your business model before expanding your operations.

Top Ten Do's and Don'ts

THE TOP TEN DO'S

Prepare a complete business plan for any business you are considering.
Use the business plan templates furnished in each session.
Complete sections of your business plan as you proceed through the course.
Research (use search engines) to find business plans that are available on the Internet.
Package your business plan in an attractive kit as a selling tool.
Submit your business plan to experts in your intended business for their advice.
Spell out your strategies on how you intend to handle adversities.
Spell out the strengths and weaknesses of your management team.
Include a monthly one-year cash flow projection.
Freely and frequently modify your business plans to account for changing conditions.

THE TOP TEN DON'TS

Be optimistic (on the high side) in estimating future sales.
Be optimistic (on the low side) in estimating future costs.
Disregard or discount weaknesses in your plan. Spell them out.
Stress long-term projections. Better to focus on projections for your first year.
Depend entirely on the uniqueness of your business or the success of an invention.
Project yourself as someone you're not. Be brutally realistic.
Be everything to everybody. Highly focused specialists usually do best.
Proceed without adequate financial and accounting know-how.
Base your business plan on a wonderful concept. Test it first.
Pursue a business not substantiated by your business plan analysis.

9 Key Things Successful Business Partners Always Do

noreply@blogger.com (KHALED TAHKOUBIT) — Fri, 26 Dec 2014 00:57:00 -0800

Are you going into business with the right person?

What's more important to a new venture than a great business idea? Finding the right business partners.

I've heard this again and again from successful entrepreneurs, and I've lost count of how many investors tell me that they put their money behind people--as much or more than ideas. Still, so many people go about this the other way around. It's especially sad to hear the stories of founding teams that had truly amazing ideas but who fell apart on a personal level.

Take Zipcar, the rent-by-the-hour car service that was founded in 2000, went public in 2011, and was later acquired by Avis Budget Group for nearly $500 million. You won't find the names of its original founders, Robin Chase and Antje Danielson, anywhere on Zipcar's website now; its About Us page briefly tells the company's story without naming them. The reason? Chase and Danielson left the company years ago.According to a new article in The Verge, the two women haven't even spoken in a decade.

I interviewed Chase for a book I co-authored with Jon Burgstone, so I knew some of Zipcar's story, but The Verge account adds some context. The story drives home the keys to how most successful business partners work together and what wrecks the chemistry between others.

Here are nine proven best practices for business partners:

1. Have a successful history together before founding a company.

This is by far the most important item on the list--the one thing from which everything else will flow (or won't). Great business partners almost always have had a prior history of working with each other. The more closely they've worked together, the better.

If you think you've found a promising person to pair up with but you don't have that kind of history, then get it. Work on small projects together, or at the very least, spend a lot of time together before you agree to do anything. You don't want the first time you have to work through a disagreement to be at a crucial point in the early life of your company.

Chase and Danielson knew each other because their kids played together on a playground. They were friends, or at least friendly, but they had never worked together before. They went from the excitement of a conversation about a cool business idea to holding their first Zipcar meeting within a matter of days, according to The Verge. That fact seems to have led to a lot of other issues.

2. Agree on vision.

Nothing derails a new venture like having business partners working at cross-purposes. So, it's crucial that co-founders agree on the vision--both their short-term understanding of the company's value proposition, and their long-term understanding of how they think the venture fits into the world.

Chase and Danielson seem to have gotten this part right. Their vision was aligned, at least in their earliest days. I remember one thing that struck me when I interviewed Chase a few years ago is that she and Danielson were both outsiders to the automobile industry--to the point that Chase didn't even like to drive.

"Conscious consumers, both [Danielson] and Chase agreed on wanting to drastically reduce reliance on single-owner cars," The Verge reported, "and thought that a company founded on that principle could be a lucrative one given America's growing interest in environmentalism."

3. Have the hard talks about money.

It's tempting when you start a new venture to skip some of the tough conversations. You're excited about the idea, and frankly you don't know whether you're starting the equivalent of Facebook or Friendster, so it can even seem counterproductive to get hung up on money. Some founders dodge the whole thing by just saying they'll split their equity, 50-50.

That can be a recipe for disaster, however, and it's apparently what Chase and Danielson did at first. Both did eventually make millions from the sale of the company, but not the kind of insane payout you might expect. From The Verge:

"Robin and I didn't get along very well," Danielson says. "She wanted extra shares, and I said, 'Look, you can get extra shares through employee stock options, but we started this together [so] we are going to have it 50/50.'" According to Danielson, that push for more assets, and more power, was their primary source of conflict.

(The Verge says Danielson's 50 percent stake was whittled down to 1.3 percent after multiple funding rounds, and that she received about $6.3 million after the $491 million Zipcar sale. It also opines that "Chase's stake had dwindled from over 30 percent to less than three.")

4. Decide who the real leader is.

In almost every successful business partnership I've studied, there's usually one visionary leader and one person who is more of a whiz at execution. I call them the Big Idea Person and the Get Stuff Done Person. Both roles are absolutely crucial; a big idea without execution is worth very little. However, there has to be some recognition that when the partners disagree on something, that one founder has the tiebreaker--the right to be, at least, "first among equals."

It's hard to reconstruct what happened with Zipcar, but it seems likely that Chase and Danielson never really resolved this before launching, according to The Verge:

The rift continued to deepen, and Danielson says she was rarely consulted on decisions, even though the company's core was composed of only a handful of people at the time. "It looked like Antje was not being brought into the discussions," says Paul Covell, a product manager at Google who was Zipcar's first engineer. "There were more conversations happening without her than with her."

5. Ensure you understand each others' commitment.

It's a great advantage not to have other commitments tugging at you when you launch a new venture. However, that's rarely the case, and frankly it can be reckless to quit your day job before figuring out whether a venture will really work.

In the case of Zipcar, both Chase and Danielson were mothers with small children. However, only Chase was able to devote 100 percent to Zipcar at the start: "Because Danielson's family relied solely on her income, she needed to keep her job," according to The Verge. Even though Danielson says she worked about 30 hours per week on Zipcar, it seems that this imbalance was an issue from the start.

6. Have compatible, vital skills.

This is related to the decision about who the real leader is. A venture founded by two programmers isn't doomed, of course, any more than a company launched by two industry experts. However, if both business partners have the same skills, you're probably going to need to seek outside help. That can cost a lot, in terms of time, money, synergy, and lots of other assets that can be in short supply in a startup.

This also seems to have been one of the issues with Chase and Danielson. Chase had graduated from the business school at the Massachusetts Institute of Technology, while Danielson was more of a pure academic who had originally come to Cambridge, Massachusetts, to work on a postdoctoral degree at Harvard. Although some people praised Danielson's work, critics quoted in the article say she brought an interesting vision but not enough unique skills.

"It wasn't like she was doing any irreplaceable task," one early employee told The Verge.

7. Have compatible styles.

You probably don't want two partners with the exact same leadership styles and personalities, but you do want people who are compatible with each other. For example, between you and a potential business partner, who is the dreamer who likes to start late and work until 3 a.m.? Who is the motivated morning person who can handle emergency customer calls before sunrise? Who is the person who is fastidious about finances, and who is the one who has the natural charisma and sales ability?

This divergence seems to have been another of the issues with Chase and Danielson. According to The Verge, "Danielson's strengths didn't work in her favor. She was an astute academic and a passionate environmentalist, but one without a shred of business experience."

8. Decide how to fill other positions.

Second only to choosing business partners, the decisions on whom to hire for early positions are among the most important to the life of a young company.

It's striking to notice how many of the early employees at Zipcar were related to Chase. Her husband was the first chief technology officer, and her brother served as director of business development. In fact, Danielson points to this issue as the ultimate turning point in the early history of the company. According to her, in 2001 she voted to give Chase the right to hire and fire without consulting Zipcar's board of directors.

"Two hours later, she was firing me," Danielson told The Verge. (Chase takes issue with this account, calling Danielson's description of the situation "fascinating.")

9. Have a plan for happily ever after.

Few companies last forever; fewer founders can successfully navigate the transition from leading a small, dynamic company to one that grows into a big player, employing hundreds. In fact, the skills that lead to success in the first kind of venture often are the exact opposite of the kind that lead to success later. Meanwhile, if you're starting a venture with someone you have a good relationship with, is that relationship strong enough to survive whatever the endgame of your venture turns out to be?

For what it's worth, both Chase and Danielson have moved on and seem to be happy and content with their endeavors. These days, Danielson is an administrator at Tufts University, where her bio mentions Zipcar almost as an afterthought. Chase enjoyed more acclaim. Time named her one of the 100 most interesting people in the world in 2009. She went on to found a successful French car-sharing company called Buzzcar, and is founder and CEO of Veniam Works, a Portuguese company specializing in vehicle communications.

Do you have the right knowledge about your business relations in order to create profitability for your company?

noreply@blogger.com (KHALED TAHKOUBIT) — Fri, 26 Dec 2014 00:53:00 -0800

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Regardless of whether you belong to company management, or hold another management position, our advisors have the expertise to unearth knowledge and information about your customers you didn’t know you had. The Soliditet Solutions team are equipped with the latest tools in order to analyse patterns and behaviour around customer bases and transactions. We do everything we can to give you the tools to create profitability.

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Why is key person insurance important for your business?

noreply@blogger.com (KHALED TAHKOUBIT) — Fri, 26 Dec 2014 00:52:00 -0800

Does your business include someone whose contribution is vital to the survival of your company? If yes, then key person insurance should be a part of your business continuity and succession plan—especially if you're a small business owner.

If a key member of your team passes away or becomes disabled, your bottom line may suffer in the short-term, and over the long-term, you may have to find a replacement or even shut down your business. However, with the benefits payable from a key person life or disability insurance plan, you could:

Recruit, hire and train a replacement
Pay off debt and deal with creditors
Alleviate lenders' concerns about your company's financial health
Reassure customers, employees and investors that the business will continue operating

What's more, if you and your family rely on your business as a primary source of income, key person insurance can help ensure that the business will continue to provide a secure financial future.

Plan to cut airline workers’ pensions passes regulatory hurdle

noreply@blogger.com (KHALED TAHKOUBIT) — Fri, 26 Dec 2014 00:48:00 -0800

A proposal to cut retired workers’ pensions as part of an overall plan to plug a €750 million hole in Irish Airlines Superannuation Scheme (IASS) has passed a key regulatory hurdle.

The trustees of the IASS, the insolvent retirement fund operated jointly by Aer Lingus and Dublin Airport Authority (DAA), have told the airline that the Pensions Authority has approved proposals to tackle its €750 million deficit and end a four-year-long dispute.

The proposals include a section 50 application, which will result in a reduction of the pensions paid to retired workers drawing income from the scheme.

This is the first use of new legislation that allows such clawbacks from pensioners where a fund is insolvent.

All members of the scheme, including current and former employees of both companies, are taking a cut in benefit. Along with this Aer Lingus has pledged to put up €191 million to fund a new defined contribution plan while DAA is offering €72 million.

The airline said it will begin implementing the plan on January 1st.

However, the Retired Aviation Staff Association has pledged to take legal action to reverse the move.

In a statement on Tuesday, it said that members will lose up to six weeks’ income a year as a result of the move.

Government files supporting brief for Microsoft in US case

noreply@blogger.com (KHALED TAHKOUBIT) — Fri, 26 Dec 2014 00:46:00 -0800

In a rare legal move, the Irish Government contributed a supporting legal brief in a significant US case, in which Microsoft is appealing a court order to hand over emails held on an Irish server.

Amicus curiae or “friend of the court” standing allows a party to offer perspective and a position on a case in which it is not directly involved. It is extremely rare for a national government to become an amicus to an international case.

In the amicus briefing, the Government argues: “Ireland has a genuine and legitimate interest in potential infringements by other states of its sovereign rights with respect to its jurisdiction over its territory.”

The State also argues that Ireland is already a party, along with the US, to an existing mutual legal assistance treaty (MLAT) – agreed between states to allow for assistance in legal cases or law enforcement investigations – that would enable the court to obtain the emails. “Ireland would be pleased to consider, as expeditiously as possible, a request under the treaty, should one be made,” the briefing states.It adds: “Ireland respectfully asserts that foreign courts are obliged to respect Irish sovereignty (and that of all other sovereign states) whether or not Ireland is a party or intervener in the proceedings before them.”

Finally, the briefing suggests that the court may be interested in a recent Irish case, Walsh v National Irish Bank [2013], in which the Irish Supreme Court ruled that the Irish State could seek data held in the branch of an Irish company operating in another state – in this case, the Isle of Man – but only in special circumstances.

In particular, this would be allowable in a case where the branch had no separate corporate identity in the foreign location, and on consideration of whether an order “would violate the law of the foreign sovereign”.

In a statement, Dara Murphy TD, Minister for Data Protection at the Department of the Taoiseach and the Department of Justice and Equality, confirmed the filing. “The right of individuals to the protection of their personal data is an essential foundation for modern society and the growing digital economy. We must ensure that individuals and organisations can have confidence in the rules and processes that have been put in place to safeguard privacy,” he said.

He noted that there are “important principles of public policy at play” and that the Government agreed to submit an amicus curiae brief to the US court “that focuses on the principles involved in this case and that points to the existing process for mutual legal assistance in criminal matters” which remain the “preferred avenue for such cooperation, including for the transfer of data”.

The original case stems from a New York court warrant for a drug trafficking investigation in 2013 in which Microsoft was told to turn over the contents of an msn.com email account. The emails are held in servers at Microsoft’s Irish data centre.

Microsoft refused to surrender the emails, stating its belief that the court needed to use existing international legal agreements between Ireland and the US and their law enforcement agencies to obtain the emails.

In a case now before the US Court of Appeals for the Second Circuit in New York, Microsoft claims the request made directly to the company goes beyond the legal power of the US government and would constitute an international data seizure.

Because of its stance, Microsoft currently stands in breach of the court in a case which has drawn international attention due to its potential implications for data privacy, and for businesses and the future of cloud computing and internet commerce.

Microsoft Ireland managing director Cathriona Hallahan said: We welcome the Government’s decision to engage formally in the process by filing an amicus brief.”

Christmas retail sales hit record numbers, peak body says; average $2,500 each spent by those over 14

noreply@blogger.com (KHALED TAHKOUBIT) — Fri, 26 Dec 2014 00:44:00 -0800

Australians spent in record numbers in the lead-up to Christmas, the peak retail body says, with those aged over 14 spending an average of $2,500 each in the six weeks leading to the event.

The Australian Retailers Association said about $45 billion was spent in the period leading up to Christmas, a slight increase on last year.

The association's chief executive, Russell Zimmerman, said Christmas was an important time for the retail sector.

"A lot of retailers depend upon the Christmas and new year period sales," he said.

"They often get around 60 per cent of their sales at this time of the year so it's an extremely important time for them.

"So here we would be hoping we're on target to achieve the $45 billion and then we get good post-Christmas sales."

He said that represented good news for the economy.

"And again remembering that retail employs around 10 per cent of the working population," he said.

Technology products have been some of the big sellers this year, Mr Zimmerman said.

"One of the things that has [also] sold particularly well in the last couple of days has been perfumes, aftershaves, personal accessories - they have done very, very well," he said.

"The one that is still a big worry to us is the clothing and footwear sector. That seems to have been very soft."

Glencore-Xstrata deal meets shareholder opposition

noreply@blogger.com (KHALED TAHKOUBIT) — Tue, 7 Feb 2012 14:08:00 -0800

LONDON (Reuters) - At least two top 10 shareholders in miner Xstrata plan to vote against a takeover by commodities trader Glencore, threatening the creation of a powerhouse spanning mining, agriculture and trading.

Standard Life Investments and Schroders said on Tuesday the deal, the mining sector's biggest, to buy the remaining 66 percent of Xstrata for $41 billion, undervalued their shares.

The deal, designed to create a company to rival mining heavyweights such as BHP Billiton and Rio Tinto, needs to be approved by 75 percent of shareholders excluding Glencore, which is barred from voting.

Standard Life, the fourth largest investor in Xstrata, and Schroders together own 3.6 percent of Xstrata, but 5.6 percent of the shares needed for approval, according to Thomson Reuters data. Their stand may persuade others to follow suit.

"I'm in complete agreement with Standard Life and we intend to do exactly the same. This is a fabulous deal for Glencore, it's probably a great deal for the Xstrata management, but it's a poor deal for Xstrata's majority shareholders," Schroders' Richard Buxton told Reuters.

Broker Liberum Capital said in a note: "Only 16 percent of Xstrata's register have to vote against the deal to block it, which means there is a significant risk Glencore's proposal isn't passed,"

Xstrata Chief Executive Mick Davis, who will be CEO of the enlarged company, admitted the two companies would have to work hard to bring some of his shareholders on board.

"We clearly have to now go to our shareholders and speak to them and take them through the transaction ... we've got a long gestation period, we recognize that," he told analysts.

Xstrata shareholders other than Glencore will hold 45 percent of the new company, to be named Glencore Xstrata International, even though Xstrata assets would comprise about 65 percent of the combined group's asset value.

Terms of the deal look set to spark tensions within investment houses which hold both Xstrata and Glencore stock.

Portfolio managers at a third top 10 investor are due to discuss the merits of the tie-up and the relative value for investors in each firm before deciding whether to reject or back the deal, a spokeswoman said, declining to be identified.

MERGER CLOUT

The new group, with mining assets from New Caledonia to the Democratic Republic of Congo, is expected to use its clout to look at other deals, including potentially a takeover of Anglo American.

"M&A is a space that you'd expect the combined group to be in," Davis told Reuters. "We have a combined entity which has much greater flexibility to be opportunistic and capture the right opportunities when they are there."

Anglo American CEO Cynthia Carroll declined to comment on the deal and when asked whether the deal signaled valuations had hit their lowest point said Anglo would be sticking to its plan of developing its pipeline of growth projects.

"Is there more and more interest in acquisitions? No question about it," she told Reuters in a telephone interview on the sidelines of a mining industry gathering in Cape Town.

Glencore will issue 2.8 new shares for each Xstrata share in a deal it said was a "merger of equals."

The ratio gives a 15.2 percent premium to Xstrata shareholders compared with its share price last Wednesday, before word leaked out about the merger talks, a joint statement said.

Xstrata chairman John Bond and Chief Financial Officer Trevor Reid will retain their posts, and Glencore CEO Ivan Glasenberg, a billionaire who owns 15.8 percent of Glencore, will be president and deputy CEO of the new company.

Some are skeptical that Davis and Glasenberg, two brash, hard-driven dealmakers from South Africa, will be able to work together as CEO and president of the combined group.

They have had a close and sometimes tense relationship as they both aggressively expanded their companies with strings of takeovers and marketing deals.

SURGE IN DEMAND

Bringing together Xstrata, the world's fourth-biggest diversified miner, and Glencore will create a group hoping to reap the reward of growing demand for commodities from China and other emerging economies.

Competition authorities are expected to have a hard look at the combined company, which will hold a big sway over markets like thermal coal, copper, zinc and ferrochrome.

"Many governments may take the opportunity to review Glenstrata's influence on their food and industrial and energy imports and exports so ... it might be forced to relinquish some of its other roles," said Neil Dwane, chief investment officer of RCM, a unit of Allianz Global Investors, an Xstrata shareholder.

Xtrata's Mick Davis was confident of antitrust approval, saying authorities in the past have always treated the two companies as one unit due to their close ties.

"There is no need for the case to be notified to the (European) Commission as it has already ruled that Glencore already controls Xstrata, said an antitrust lawyer who declined to be named because of the sensitivity of the matter.

"But this is a tricky situation, there are some overlaps, so the regulator may decide to take a fresh look."

The combined group expects synergies of at least $500 million and to boost earnings to Xstrata shareholders in its first full financial year.

The new group will be the world's biggest exporter of coal for power plants, top integrated zinc producer and would have had revenues of $209 billion and adjusted core profit of $16.2 billion had they been together during 2011.

The size of the deal surpasses Rio Tinto's $38 billion takeover of Alcan in 2007.

Xstrata shares fell 3.8 percent while Glencore declined 2.8 percent on Tuesday afternoon compared to a 2.1 percent fall in the sector.

($1 = 0.6331 British pounds)

(Additional reporting by Sinead Cruise, Chris Vellacott, Victoria Howley, Yun Chee Foo and Clara Ferreira-Marques; Editing by Chris Wickham and Elizabeth Piper)

SEC weighs two money market fund proposals

noreply@blogger.com (KHALED TAHKOUBIT) — Tue, 7 Feb 2012 14:06:00 -0800

(Reuters) - The chairman of the Securities and Exchange Commission is eyeing two potential plans to bolster the stability of money market funds, but their fate remains uncertain due to internal disagreement at the SEC over the need for more regulations.

Last month, agency staff circulated early drafts for either a capital buffer or a floating fund valuation, both aimed at preventing runs on money market funds and investor losses in the $2.6 trillion industry, people familiar with the matter said.

Regulators began to focus on new rules for the money market fund industry after the Reserve Primary Fund "broke the buck" in 2008, at the height of the financial crisis, when its net asset value below the $1 mark.

In 2010, the SEC adopted a series of new rules in response to that event, including tightening credit quality standards, shortening the maturities of fund investments and imposing a new liquidity requirement.

The industry and several SEC commissioners have questioned whether any further changes are required.

One of the new plans, favored by some SEC staff and banking regulators, would consist of both a capital buffer requirement and a 30-day hold-back on redemption requests by investors.

Under that proposal, funds would need to maintain a 1 percent capital cushion and they would hold back 3 percent of investor funds for 30 days after a redemption request.

The alternative plan calls for a floating net asset value to help curb investor complacency over the stable $1-per-share value that funds currently quote.

The concepts were first discussed by SEC Chairman Mary Schapiro in a major speech to the brokerage industry last November.

The Wall Street Journal reported on Tuesday that the SEC would unveil the plans in the coming weeks.

SEC staff are hoping to put both plans out for public comment, but would anticipate only adopting one of the two proposals, people with knowledge of the matter told Reuters. The goal is to unveil them sometime in the spring.

Schapiro, the Federal Reserve and other members of the Financial Stability Oversight Council, have argued that more changes are needed to prevent a run on money market funds.

"The Chairman has long called for reform of money market funds to avoid the destabilizing events that occurred following the breaking of the buck of the Reserve Primary Fund in 2008," SEC spokesman John Nester said on Tuesday.

"As a first step of reform, the SEC adopted meaningful measures to increase the resiliency of money market funds by shortening their maturities and enhancing their liquidity. As a second step, the Chairman is advocating structural reforms to money market funds to address their susceptibility to runs and provide a buffer against losses," Nester said.

To put these latest proposed reforms out for comment, the SEC needs approval from at least three of the five commissioners.

But three commissioners have expressed some doubts about the need for more reforms, with at least some of them unlikely to even agree to propose a rule, let alone vote to implement one, one person familiar with their thinking said.

Part of their concern stems from the fact that the SEC already acted to put new rules on the books in 2010 and that the latest proposals might harm the industry.

"As far as I know, these issues were fully vetted in 2010," said Dan Gallagher, the SEC's newest commissioner, in an interview with Reuters last week. "There has to be data that shows the need to act in this space or data that shows that you don't. But I just haven't seen that yet."

Money market fund executives have said the proposals could drive investors out of money funds and into bank accounts and reduce a key source of credit for U.S. businesses.

Fidelity Investments has warned regulators that more than half of its money-fund clients would move some or all of their assets out of the investments if the net asset value of the funds were allowed to fluctuate.

Bernanke repeats vow to shield U.S. from Europe fallout

noreply@blogger.com (KHALED TAHKOUBIT) — Tue, 7 Feb 2012 14:04:00 -0800

WASHINGTON (Reuters) - Federal Reserve Chairman Ben Bernanke on Tuesday renewed a pledge to prevent Europe's financial crisis from damaging the U.S. economy in testimony before Congress that mirrored remarks he made last week.

"We are in frequent contact with European authorities, and we will continue to monitor the situation closely and take every available step to protect the U.S. financial system and the economy," Bernanke said in remarks prepared for delivery to the Senate Budget Committee.

The Fed chairman maintained a cautious tone on the U.S. outlook and did not refer to surprisingly strong U.S. jobs data released on Friday.

"We still have a long way to go before the labor market can be said to be operating normally," he said, employing language identical to remarks delivered on Thursday before the House budget panel.

Tiger Airways in talks with regulators over grounding

noreply@blogger.com (KHALED TAHKOUBIT) — Mon, 4 Jul 2011 12:52:00 -0700

Tiger Airways planes have been grounded in Australia by regulators on safety concerns

Tiger Airways will hold crisis talks with Australian regulators to try and counter safety claims and resume its domestic operations.

The Singapore-based low cost carrier's aircraft were grounded in Australia on Saturday by the Civil Aviation Safety Authority (CASA) on safety concerns.

The disruptions come at the start of peak school holiday season, which means less intense price competition.

Shares in Tiger Airways in Singapore plunged almost 20% on Monday.

The airline's domestic Australian flights will be grounded until July 9, but its flights to Singapore are not affected.

Shares of competitors rose sharply as a result, with Virgin Australia jumping 10.5% and Qantas climbing 6.5%.

Chief executive Tony Davis has flown to Australia for talks with the CASA.

The airline said in a statement to the Singapore Stock Exchange that he had been charged with getting its planes back in the air.

Tiger said Mr Davis was going to focus on "assisting Tiger Airways Australia to resume operations as soon as possible."

Tiger operates 10 Airbus A320s domestically in Australia. It moves about 9,000 passengers a day on 60 domestic flights.

It is the first time in Australia's aviation history that an entire fleet has been grounded.

Safety concerns

The grounding of the fleet came after the CASA said its concerns about safety had gone unaddressed by Tiger.

"CASA believes permitting the airline to continue to fly poses a serious and imminent risk to air safety," the regulator said in a statement.

The regulator said it had been closely monitoring the airline and had sent a notice threatening to suspend or cancel its licence over the safety issues.

"The suspension of Tiger Airways Australia follows the issue of a show cause notice to the airline in March 2011."

That notice included instructions for Tiger to improve the proficiency of its pilots, give them more training and to address issues such as fatigue management.

Sony ranks as Asia's top brand, says Campaign magazine

noreply@blogger.com (KHALED TAHKOUBIT) — Mon, 4 Jul 2011 12:51:00 -0700

Despite Asia's much hyped appetite for luxury goods, no designer brands were in the the top 25.

Sony has been ranked top in a survey of Asia's most valuable brands by the marketing magazine Campaign.

The company gained the top spot despite hacking attacks earlier this year that compromised the personal details of 100 million PlayStation users.

Japanese and South Korean consumer electronics brands occupied the top five slots, with Sony trailed by Panasonic, LG, Samsung and Canon.

No Chinese brand names cracked the top 100.

White goods and electronics maker Haier was the highest Chinese brand at 102.

"This year's survey reiterated the challenges Chinese and Indian brands are facing to gain consumer recognition beyond their home markets," the report said.

The highest ranked Indian brand at 89 was Amul, which makes milk products and ice cream.

Source: Campaign

The top five brands were unchanged from last year, reflecting their everyday appeal among Asia's shoppers.

And despite Asia's much hyped appetite for luxury goods, there were no luxury brands in the top 25. Chanel, Rolex and BMW ranked 30th, 42nd and 49th respectively.

Even though Prada listed on the Hong Kong stock exchange this year, it fell almost 100 places from last year's survey to rank 348th.

In China, Taiwan instant noodle brand Master Kong was the most commonly recalled brand after Sony.

The survey was conducted by market research firm TNS, which surveyed 3,322 consumers in Australia, China, India, Japan, Hong Kong, Malaysia, Singapore, Taiwan, South Korea and Thailand.

Japan finds rare earths in Pacific seabed

noreply@blogger.com (KHALED TAHKOUBIT) — Mon, 4 Jul 2011 12:50:00 -0700

The number of seabed mining applications is a growing focus for environmentalists' concern

Japanese researchers say they have discovered vast deposits of rare earth minerals, used in many hi-tech appliances, in the seabed.

The geologists estimate that there are about a 100bn tons of the rare elements in the mud of the Pacific Ocean floor.

At present, China produces 97% of the world's rare earth metals.

Analysts say the Pacific discovery could challenge China's dominance, if recovering the minerals from the seabed proves commercially viable.

The British journal Nature Geoscience reported that a team of scientists led by Yasuhiro Kato, an associate professor of earth science at the University of Tokyo, found the minerals in sea mud at 78 locations.

"The deposits have a heavy concentration of rare earths. Just one square kilometre (0.4 square mile) of deposits will be able to provide one-fifth of the current global annual consumption," said Yasuhiro Kato, an associate professor of earth science at the University of Tokyo.

The minerals were found at depths of 3,500 to 6,000 metres (11,500-20,000 ft) below the ocean surface.

Environmental fears

One-third of the sites yielded rich contents of rare earths and the metal yttrium, Mr Kato said.

The deposits are in international waters east and west of Hawaii, and east of Tahiti in French Polynesia.

Why rare earths are so important to the world's economy

Mr Kato estimated that rare earths contained in the deposits amounted to 80 to 100 billion tonnes.

The US Geological Survey has estimated that global reserves are just 110 million tonnes, found mainly in China, Russia and other former Soviet countries, and the United States.

China's apparent monopoly of rare earth production enabled it to restrain supply last year during a territorial dispute with Japan.

Japan has since sought new sources of the rare earth minerals.

The Malaysian government is considering whether to allow the construction of an Australian-financed project to mine rare earths, in the face of local opposition focused on the fear of radioactive waste.

The number of firms seeking licences to dig through the Pacific Ocean floor is growing rapidly.

The listed mining company Nautilus has the first licence to mine the floor of the Bismarck and Solomon oceans around Papua New Guinea.

It will be recovering what is called seafloor massive sulphide, for its copper and gold content.

The prospect of deep sea mining for precious metals - and the damage that could do to marine ecosystems - is worrying environmentalists.

Australian retail sales dip, rates to be kept on hold

noreply@blogger.com (KHALED TAHKOUBIT) — Mon, 4 Jul 2011 12:48:00 -0700

Analysts were expecting a rise in retail sales

Australian sales of retail goods, such as clothes and shoes, fell unexpectedly in May suffering the biggest drop in seven months.

Retail sales dropped 0.6% compared to the previous month, according to the bureau of statistics. Most analysts had expected a gain of 0.3%.

Other figures out on Monday showed that new home approvals also fell for a second straight month.

The data will strengthen arguments for keeping interest rates on hold.

The Australian dollar weakened slightly after the figures were released.

'Softness across sectors'

The Reserve Bank of Australia (RBA) meets on Tuesday to decide whether to raise interest rates from the current level of 4.75%.

Analysts say that weak consumer demand translated into the drop in retail sales.

"The softness was across sectors and regions, so there's little sign of the pick-up in economic momentum that the RBA was expecting," said Brian Redican of Macquarie Bank.

"The consumer clearly doesn't need any more encouragement from the RBA to stay on the sidelines. It lessens the need for another hike."

In April, retail sales rose 1.2%, revised up from 1.1%. Analysts were expected a pull back after the big bounce but the drop was much more than expected.

Making matters worse is the data on building approvals which fell 7.9% in May.

"All up it's a pretty weak set of data and not encouraging at all," said Michael Turner of RBC Capital Markets.

Europe's insurers found to be 'robust'

noreply@blogger.com (KHALED TAHKOUBIT) — Mon, 4 Jul 2011 12:47:00 -0700

The French insurance industry owns some 9bn euros in Greek debts

A stress test of Europe's biggest insurers has found them to be "robust" despite exposure to Greek debt.

More than 90% of the 221 firms examined met minimum solvency standards even in the most adverse scenario considered.

However, the exercise identified key vulnerabilities, including exposure to sovereign debts, such as Greece's, and natural catastrophes.

The tests were done by a newly-created regulator, the European Insurance and Occupational Pensions Authority.

None of the insurance companies - which comprise at least 50% of the market in each country - was identified.

'Distraction'

Insurance companies have large exposures to Greek and other troubled European government debt.

Not only have the firms invested in Greek bonds, they are also thought to have written insurance on Greek credit risk in the form of credit derivatives.

French insurers own some 9bn euros (£8bn, $13bn) in Greek government debt.

Meanwhile, German insurers have been asked by their government to participate in a plan to relend Greek debts coming due in the next two years, with Allianz having agreed to provide 300m euros.

German insurer Allianz has offered to contribute 300m euros towards a new bail-out of Greece

Besides sovereign debt exposure, the risks facing the insurance industry included:

big losses on shares and other investments
a sharp rise in interest rates
a sharp rise in inflation, meaning the value of insurance claims outstrips premium payments
major natural disasters
a failure of the reinsurance market, which insurers rely on to share losses

It is second such set of stress tests for insurance companies, which shadow a similar exercise being carried out on the big banks by the European Banking Authority.

However, unlike the banks being tested, insurers that fail the test will not yet be formally required to top up the capital they hold to absorb future losses.

The latest tests for insurers come at a time when they are still fleshing out a new set of Europe-wide rules for the industry.

The Association of British Insurers has called the stress tests

"The UK insurance industry is currently under great pressure to implement an enormously complex regulatory framework," said the ABI's Peter Vipond.

"Rather than demand stress tests on the basis of a yet to be agreed framework, it would be better to focus on finalising the proposed rules and helping the industry put the infrastructure in place to make them work by 2013," he said.

Greece crisis: S&P warns of debt default

noreply@blogger.com (KHALED TAHKOUBIT) — Mon, 4 Jul 2011 12:46:00 -0700

There have been violent protests against the austerity measures in Greece

Standard & Poor's has warned that current proposals for restructuring Greece's debt would effectively constitute a default.

The ratings agency said plans for the private sector to roll over debts could trigger a default under its ratings criteria.

Last week, the Greek parliament passed tough austerity measures to secure further financial aid.

However, there is a growing sense that a debt restructuring is inevitable.

German and French banks have already agreed in principle to roll over loans to Greece in order to give the country more time to repay its debts.

This could involve effectively reinvesting the proceeds of maturing Greek debt into newly-issued bonds.

Standard & Poor's said that, depending on the circumstances, it viewed "certain types of debt exchanges and similar restructurings as equivalent to a payment default".

The options laid out so far for restructuring Greek debt would constitute such a default, it said.

Shares in European banks lost ground following the downgrade.

In the UK, Royal Bank of Scotland and Lloyds Banking Group both lost about 2.3%, in France Credit Agricole and Societe Generale fell about 2%, while in Germany Commerzbank slipped 1.7%.

Last month, Standard & Poor's downgraded Greece to CCC from B.

Fresh bail-out

Over the weekend, eurozone finance ministers approved the latest tranche of emergency help for the Greek economy.

They will release 12bn euros (£10.4bn, $17.4bn) in the next two weeks to help Greece meet spending commitments and avoid defaulting on its huge debts.

Last week, the Greek parliament passed tough austerity measures demanded by the European Union (EU) and International Monetary Fund (IMF).

MPs backed the measures despite angry protests on the streets of Athens.

Last May, the EU and IMF provided 110bn euros in emergency loans to Greece, and agreed last month to provide another 120bn euros in loans to try and help the country though its debt crisis.

Plunge in corn prices may ease food inflation

noreply@blogger.com (KHALED TAHKOUBIT) — Sat, 2 Jul 2011 13:06:00 -0700

The price of corn suffered its biggest fall for 15 years on Thursday, prompting speculation that the high cost of food may start to ease.

Corn prices fell 10% after a US Department of Agriculture report said that farmers were sowing unexpectedly large amounts of the grain.

The price of other crops, including soybeans, also fell on speculation that future stock levels will remain high.

Corn prices recently hit a record, helping to fuel inflation worries.

The report said farmers in the vast crop regions of Iowa and Minnesota had been planting substantially more grain.

Corn futures, which were just under an all-time high of $8 (£5) a bushel at the start of June, finished 9.9% down at $6.29 on Thursday. At one point, the price was down almost 12%.

Wheat futures ended 8.8% down, with soybeans 2.1% lower. The falls continued on Friday, with wheat futures down almost 2% in early Asia trading.

The Agriculture Department report, which said that far more grain acreage was being planted than expected, came despite recent bad weather in the US mid-west.

"There are some big surprises in this report," said Karl Setzer, commodity expert at the MaxYield Cooperative in Iowa.

The report said farmers had planted 92.282 million acres with corn this spring, well above an average trade estimate of 90.767 million acres.

The increase in planting comes as Russia is expected soon to lift a year-long ban on grain exports.

Price delay

More expensive grain has led to food price rises, with everything from meat and cereal to soft drinks costing more in the supermarket.

A huge harvest in August is likely to slow food inflation, which was predicted to rise between 3%-4% this year in the US.

Analysts say it typically takes about six months for changes in commodity prices to feed into retail food prices.

"All of us who perceived tighter [corn] supplies... were proven wrong today," said Jason Ward, an analyst with Northstar Commodity.

However, Mr Ward pointed out that the extra acreage had yet to be harvested and could be damaged by further bad weather.

Russia rescues Bank of Moscow in record bail-out

noreply@blogger.com (KHALED TAHKOUBIT) — Sat, 2 Jul 2011 13:05:00 -0700

The bank's erstwhile head, Andrei Borodin, has fled the country

Russia's fifth largest bank, Bank of Moscow, has been given the biggest bail-out in Russian history.

The $14bn rescue came after another bank, VTB, gained control through a hostile bid, only to uncover bad loans valued at $9bn - a third of the bank's assets.

Bank of Moscow's former head, Andrei Borodin, has fled the country, and a warrant has been issued for his arrest.

The bank was used by ex-Moscow Mayor Yuri Luzhkov to fund property projects.

'Fraudulent lending'

Mr Luzhkov was sacked by Russian President Dmitry Medvedev last year.

In a statement issued in London, Mr Borodin said he was shocked at the size of the bail-out, and claimed that VTB's takeover of the bank was politically motivated.

VTB, for its part, accused Bank of Moscow of committing "fraudulent lending" under Mr Borodin's control, while Russian Finance Minister Alexei Kudrin has called for a criminal investigation.

Under the rescue deal, the Russian central bank will provide a 295bn rouble ($10.6bn) 10-year loan at a negligible interest rate to Bank of Moscow.

Meanwhile, VTB will invest a further 100bn roubles to recapitalise the bank - taking its ownership share from 46% to 75%, enough to qualify for state aid.

VTB, Russia's second-biggest lender, had itself to be rescued by the Russian state to the tune of $6.4bn during the financial crisis.

Cost of Euro mobile roaming falls

noreply@blogger.com (KHALED TAHKOUBIT) — Fri, 1 Jul 2011 03:23:00 -0700

The European Commission wants to make roaming rates the same as domestic rates by 2015

The cost of making and receiving mobile phone calls while travelling in Europe has come down again.

From today, operators cannot charge more than 32p per minute (plus VAT) for outgoing calls, and 10p per minute (plus VAT) for incoming calls.

The new tariffs are the latest in a series of annual price reductions forced on the mobile industry by the European Commission.

Brussels has said it aims to equalise roaming and domestic charges by 2015.

Price regulation was introduced in 2007 by the then commissioner for information society and media, Viviane Reding.

Since then, the maximum call charge has been reduced by approximately 6% per year.

A group of UK mobile operators - O2, Vodafone, Orange and T-Mobile - attempted to challenge the Commission's price-cutting agenda, taking their case to the European Court of Justice.

However, their complaint was dismissed in June 2010.

Along with the lower rates for phone calls, the commission also reduced the wholesale rate of mobile data from 80 euro cents (72p) to 50 euro cents (45p) per megabyte.

Whereas the price cap on voice calls applies directly to the way consumers are billed, the data changes only affect what operators charge each other. There is an expectation, rather than obligation to pass-on the savings.

Operators are compelled to place a 50 euro (£45) cap on users' data consumption, in order to avoid unexpectedly high bills. Customers who wish to continue their data roaming can request to have the limit removed.

UBS says Axel Weber set to be its next chairman

noreply@blogger.com (KHALED TAHKOUBIT) — Fri, 1 Jul 2011 03:22:00 -0700

Mr Weber had been expected to join Deutsche Bank

Swiss bank UBS has said it will nominate former Bundesbank boss Axel Weber to be its next chairman.

The bank said the board would nominate him at the annual meeting in May 2012 and, if elected, he will succeed Kaspar Villiger as chairman in 2013.

Mr Weber headed Germany's central bank from April 2004 to April 2011.

He had been seen as a front runner to succeed Jean-Claude Trichet as chief of the European Central Bank but ruled himself out of the race in February.

The appointment will see a German running Switzerland's biggest bank, while a Swiss, Josef Ackermann, currently heads Germany's biggest bank, Deutsche Bank, although Mr Ackermann is due to stand down in 2013.

The announcement also puts an end to speculation that Mr Weber would succeed Mr Ackermann at Deutsche.

Analysts were surprised by the news but said it was a good move by UBS.

"I think it's positive that they were able to announce it two years in advance. He's a strong candidate who was also in talks to become chairman of the management board at Deutsche Bank, so it's very good news," said Cheuvreux analyst Christian Stark.

"Villiger was always seen as a temporary solution to help UBS get through the crisis and Axel Weber's clearly got more of a connected network into the international banking industry."

China manufacturing slows as Beijing reins in growth

noreply@blogger.com (KHALED TAHKOUBIT) — Fri, 1 Jul 2011 03:19:00 -0700

The manufacturing sector been one of the biggest drivers of growth in the Chinese economy

China's manufacturing sector expanded at its slowest pace in 28 months following government policies to prevent the economy from overheating, according to an official survey.

China's purchasing manager's index (PMI) fell to 50.9 in June from 52 in the previous month.

The PMI is a key an indicator of conditions in the sector, which is a big contributor to China's growth.

China is the world's second-largest economy.

Even though the figure remained above the threshold level of 50, indicating expansion in the sector, the drop from the previous month indicates that growth is slowing.

Beijing has been trying to slow down its credit-fuelled growth in an attempt to prevent asset prices from overheating.

Analysts said the government's policies are starting to hurt the manufacturing sector.

"It think the primary reason is monetary tightening and a reduction of credit," said Sitao Xu of the Economist Intelligence Unit in Beijing.

"Both central bank and the government are taking a hawkish stance to prohibit high credit growth."

'Synchronised slowdown'

“Start Quote

What the government is trying to do is prevent the economy from overheating ”

End Quote Sitao Xu Economist Intelligence Unit

While internal policies are curbing growth in the sector, analysts said that external factors are also playing a key role.

"The other reason is the synchronised slowdown in developed countries," Mr Sitao said.

The recovery in the US has not been as fast as expected, hence demand from the world's biggest economy has been sluggish, he said.

He added that the debt crisis in European countries had also affected demand for Chinese goods from the region.

However, the overall health of the Chinese economy remained robust, despite the slowdown in manufacturing, he said.

"I don't think it's the end of the world, we are not seeing a hard landing or a recession," he said.

"What the government is trying to do is prevent the economy from overheating."

Eurozone manufacturing growth at 18-month low

noreply@blogger.com (KHALED TAHKOUBIT) — Fri, 1 Jul 2011 03:17:00 -0700

The figures showed weakness across the board

Growth in the eurozone's manufacturing sector lost steam in June as both exports and domestic demand slowed, falling to an 18-month low, a key survey has shown.

Markit's Manufacturing Purchasing Managers' Index (PMI) fell to 52.0 last month from 54.6 in May, its lowest reading since December 2009.

Any reading above 50 indicates growth.

"Increasing numbers of countries are showing signs of sliding back into recession," Markit said.

Italy's manufacturing sector shrank for the first time in 20 months, while Spain's contracted for the second month in a row.

Growth in the German and French sectors slowed considerably, while the UK's manufacturing expansion fell to a 21-month low.

Gilles Moec, senior European economist at Deutsche Bank, said the data reflected two main factors: inflation hampering consumer demand and the end of stimulus measures in a number of regions, including the US.

"The weakness is no longer simply in the peripherals, it's now moving to Italy for instance," he told the BBC.

"This is painting a different picture from the one we had a few weeks ago."

Plunge in corn prices may ease food inflation

noreply@blogger.com (KHALED TAHKOUBIT) — Fri, 1 Jul 2011 03:15:00 -0700