Thursday, February 17, 2011
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BUSINESS Japan and India sign free trade pact Associated Press
TOKYO – Japan and India signed a free trade agreement Wednesday amid a push by Japan to revive its weak economy by lowering barriers to trade and deepening its economic ties with the fast-growing nations of emerging Asia. The economic partnership agreement, signed by Japanese Foreign Minister Seiji Maehara and Indian Commerce Minister Anand Sharma Wednesday, will slash tariffs on goods from DVD players to shrimp and lumber, and introduces measures to promote investment and deal with intellectual property rights. Forging this kind of pact is increasingly a priority for Japan, which sees itself falling behind regional rival South Korea in the area of free trade agreements. With Japan’s population shrinking and its economic stuck in a two-decade slump, Prime Minister Naoto Kan has declared that Japan needs to “open up” to revive its prospects. Sharma called the agreement “historic and significant,” highlight-
ing how emerging economies such as India and China are reshaping the global economy. Despite both being big economies, Japan and India have limited trade, totaling 1.267 trillion yen, or about $15 billion, in 2010 — just 1 percent of Japan’s global trade. By comparison, Japan’s annual trade with China exceeds 26.4 trillion yen, or $317 billion. Sharma told Maehara he hoped the pact would double trade volume between the nations within 3-4 years, according to the Ministry of Foreign Affairs. The pact still needs ratification by Japan’s parliament to come into force, but India does not require the approval of its legislative body. Under the agreement, Japan will within 10 years remove tariffs on 97
percent of Indian imports, with India eliminating tariffs on 90 percent of goods imported from Japan. Japan will allow greater market access on most products in the industrial sector, as well as agricultural products such as curry, tea leaves, lumber and shrimp. India in turn will cut tariffs on Japanese imports ranging from car mufflers and steel sheets to DVD players and video cameras, as well as peaches, strawberries and Japanese yams. The two countries also agreed to enter negotiations over allowing into Japan nurses and other certified careworkers from India, aiming to conclude talks within two years after the economic partnership agreement becomes effective. Kan’s government is considering whether to join a broad free trade zone that nine Pacific Rim countries, including the U.S. and Australia, are negotiating called the Trans-Pacific Partnership. Tokyo plans to announce a decision on that in June.
AFP PHOTO / TOSHIFUMI KITAMURA
Indian Commerce Minister Anand Sharma (L) delivers a speech while Japanese Foreign Minister Seiji Maehara listens after signing the documents on a free trade pact at the foreign ministry in Tokyo on February 16, 2011.
Banks ‘had to know’ Daihatsu to launch budget of fraud, Madoff says car in Southeast Asia Agence France-Presse
Agence France-Presse
WASHINGTON – Wall Street fraudster Bernard Madoff told The New York Times in a prison interview that unidentified banks and hedge funds were somehow “complicit” in his massive Ponzi scheme. “They had to know,” Madoff said in story posted on the newspaper’s website late Tuesday. “But the attitude was sort of ‘If you’re doing something wrong, we don’t want to know.’” Madoff, who touted himself as one of New York’s most successful money managers, was arrested in late 2008 and sentenced in June 2009 to 150 years in prison. His victims, including charities, major banks, Hollywood moguls and savvy financial players, handed him tens of billions of dollars over more than two decades. Madoff’s right hand man, Frank DiPascali, and his accountant, David Friehling, have since pleaded guilty in an investigation that has yet to fully unravel the crime or compensate the approximately 16,000 direct victims. Even the amount of money stolen remains elusive: Madoff originally claimed to have been managing $65 billion, but in October, the courtappointed liquidator said the real bottom line was $21.2 billion in cash losses. Times journalist Diana Henriques interviewed Madoff in a visitor room at the federal prison in Butner, North Carolina. The interview and earlier email correspondence with Madoff were conducted as part of her research for an upcoming book on the scandal. “The Wizard of Lies: Bernie Madoff and the Death of Trust” is scheduled to be published this spring. The Times said the Madoff interview was the
first for publication since his 2008 arrest. Banks and hedge funds who did business with Madoff had “willful blindness,” he said. He was surprised to learn about emails and other messages bankers exchanged before the collapse of his scheme. Some of those emails are coming to light through lawsuits. “I’m reading more now about how suspicious they were than I ever realized at the time,” Madoff said. He did not indicate that any specific bank or hedge fund knew about his Ponzi scheme, which ran 16 years. Instead, he said, they failed to conduct proper scrutiny. US prosecutors have not accused the major banks or hedge funds that did business with Madoff of knowingly investing in his scheme. Meanwhile, the trustee charged with recouping assets for victims sued British banking giant HSBC and related entities in December, seeking at least $9 billion. Trustee Irving Picard accused the firms of enabling Madoff’s scheme by creating, marketing and supporting “an international network of a dozen feeder funds based in Europe, the Caribbean and Central America.” HSBC said it was defending itself “vigorously” against the claims filed in US federal bankruptcy court in New York. Also in December, Picard said he was seeking $6.4 billion from JPMorgan Chase for supporting the scam and he has filed a suit against Swiss bank UBS seeking $2 billion in damages for its alleged part in the fraud. And a lawsuit unsealed this month claims owners of Major League Baseball’s New York Mets ignored repeated signs and clear warnings that Madoff was operating a fraud scheme.
TOKYO – Japanese automaker Daihatsu, a subsidiary of Toyota, will begin manufacturing a low-priced compact car in Indonesia in 2013 for sale in Southeast Asian nations, a business daily said Wednesday. Tapping its expertise in minicars, Daihatsu plans to develop a fuel-efficient vehicle in Indonesia and supply 70 percent of the output to be sold under the Toyota brand, the Nikkei daily said without citing sources. To sell for up to 900,000 yen ($10,750) — the cheapest Toyota car in the global market, the new vehicle will be a little smaller than the Etios,
a strategic small sedan that Toyota launched in India late last year, it said. Daihatsu, which already has a factory in Jakarta capable of assembling 280,000 vehicles a year, plans to spend 20 billion yen to build a new plant, which will have an initial annual capacity of 100,000 units, the paper said. Toyota and Daihatsu are the first and second best-selling automakers in Indonesia, controlling 53 percent of the market between them, the Nikkei said. Daihatsu announced last month that it would pull out of the European market within two years because of the strong yen cutting profits.
AFP PHOTO/Frederic J. BROWN
Prices of food items and other household goods are posted outside a supermaket in Beijing as customers enter and exit on February 16, 2011. Rising food prices have pushed about 44 million people into poverty in developing countries since last June, the World Bank warned on February 15, as food costs continuing rising to near 2008 levels when price spikes in food and oil had devastating impacts on the poor.