Weakening Economies Worldwide

United States Dollars. (Photo: Getty Images)

AUSTRALIA — The Australian, (1/29): Last week BHP Billiton announced it will cull 6,000 jobs worldwide, shedding more than half of those in Australia. Its massive nickel mine in Ravensthorpe, Western Australia will shut down, along with 350 nickel refinery jobs at Yabulu in Townsville, Queensland. Worse still, more job losses are feared, and all this because nickel prices have slumped over recent months. The announcement heralds the death of towns such as Hopetoun, south east of Perth, that Australian taxpayers helped build and will now have to pay for again, as residents face ruin.

UNITED KINGDOM — The Daily Telegraph, (1/24): Steel giant Corus led a wave of job cuts on Monday with plans to axe 3,500 staff as demand for the metal plummets. The company, which is owned by Indian conglomerate Tata, will shed more than 10pc of its UK workforce — some 2,500 employees...Corus's plans emerged as Royal Bank of Scotland announced 750 job losses at Irish unit Ulster Bank and concerns grew for the 2,500 UK staff employed by Philips, Europe's largest electronics manufacturer, after the company said it was cutting 6,000 jobs worldwide.

ICELAND — The Iceland Review, (1/12): Arnar Sigmundsson, chairman of the National Association of Pension Funds (LL), said banks had been granting both individuals and companies loans in foreign currencies while they were speculating on the depreciation of the Icelandic króna. "That has to be investigated and especially the part of the large shareholders," Sigmundsson told Morgunbladid. Páll Hreinsson, chairman of the Althingi parliament's investigation committee, said the committee will look into whether there is a systematic pattern of such practice and unnatural conduct involved in the banks' operations…Before the collapse, some companies and associations had made investments with the appreciation of the ISK in mind, including the pension funds and various export companies, while others, such as the investment companies Exista and Kjalar, had speculated that the ISK would depreciate...When the Icelandic banking system collapsed in October 2008, the banks had made forward currency exchange contracts worth between ISK 600 and 700 billion (USD 4.9 and 5.7 billion, EUR 3.4 and 4.0 billion.)

ICELAND — The Icelandic Government Information Center (2/2): In the fall of 2008, Iceland experienced wide-spread financial difficulties. In the wake of the global financial crisis, Iceland's three largest private banks were taken into government administration due to a lack of available credit to finance debts, despite substantial assets. The resulting contraction of the Icelandic economy has had a profound effect on Iceland and its population. External debt has increased substantially from one of the lowest levels in the world, and sharp increases in unemployment and inflation are having substantial and adverse affects on peoples' lives.

JAPAN — The Asahi Shimbun, (1/29): The government plans to use taxpayers' money to provide capital injections to companies outside the financial sector, expanding a safety net against the deepening financial crisis …Nonfinancial companies whose bankruptcy would have a far-reaching adverse impact on employment or on the local economy will be eligible for funding...Currently, there is no system in place to inject public funds into nonfinancial companies, while undercapitalized banks can apply for taxpayers' money under the Financial Functions Strengthening Law and other legislation. The new framework is designed to help selected companies weather the difficulties brought on by the global economic slowdown and rebuild their operations once the economy recovers...The sources said public fund injections can also bolster the credibility of recipient companies and encourage private-sector investors to throw in their own funding.

FRANCE — International Herald Tribune, (1/24): Hundreds of thousands of strikers marched through French cities on Thursday to demand pay rises and protection for jobs, challenging President Nicolas Sarkozy to do more for ordinary workers..."The government has taken measures for banks but today it is the workers who are suffering," said striker Charles Foulard, a technician at a refinery run by energy giant Total. "This crisis comes from the United States, it's the financial bubble that is bursting. It's not for the workers to pay for that," he said as crowds gathered at the Place de la Bastille in Paris, birthplace of the French Revolution…France's economic woes are less severe than Spain's or Britain's but its jobless rate is rising, hitting 2.07 million in November, up 8.5 percent on the year, and unions say Sarkozy's policies are not helping ordinary people...Sarkozy, however, struck a conciliatory tone, saying people's concerns were "legitimate."

CHINA — Xinhau, (2/1): China's government Sunday warned 2009 will be "possibly the toughest year" since the turn of the century in terms of securing economic development and consolidating the "sound development momentum" in agriculture and rural areas. The lingering global financial crisis and the slowdown of the world economy had exerted an increasingly negative impact on the Chinese economy, said the first document of the year issued jointly by the State Council and the Central Committee of the Communist Party of China... Millions of rural workers lost their jobs and returned home from coastal provinces, exacerbating the severe unemployment in rural areas...China should "especially place priority on tapping the rural market and developing the countryside" to alleviate the effects of the global financial crisis, said Vice Premier Wang Qishan last month.

EGYPT — Al-Ahram (1/15): Not too long ago, thousands of Arabs were engaged in protesting against rising food prices. In April, Arab agriculture ministers met in Riyadh to discuss the crisis that was taking the world by storm at the time: skyrocketing food prices. Several resolutions were made and a further meeting in December 2008 was promised. But as soon as prices of food and agricultural products went tumbling down in late 2008, everyone conveniently forgot about the original problem. No one wants to waste time on a problem that has gone away. But that is exactly where the trouble is. Food may be cheap today, but food scarcity may well be just around the corner. What was true in April still rings true today...He also predicts a major world food shortage as the world begins to rely on agriculture for energy. For starters, we should aim at achieving food security and self-sufficiency. The day is nearing when the world will rely on agricultural products as a renewable energy source…The future belongs to those who produce their own food...Arab food security and agriculture deserve the same attention we give to the industry, banks, and commerce as they struggle to overcome the current recession. We need to support strategic crops and shield our farmers against price fluctuations. Public and private investment in agriculture should be a top priority for the upcoming summit.

RUSSIA — Pravda - (2/1): A third of the polled Russians, believe that their personal situation has worsened. However, many of them said that they did not want to economize, the Russian Statistics Agency said... The Russians are more confident than the Europeans despite pessimistic consumer expectations. The consumer confidence index dropped by 20 percent in Russia, whereas in Britain, Italy and Slovakia the index dropped by nearly 26 percent, according to Business and Consumer Survey Results. The index dropped by 43 percent in Spain, by 47 percent in Portugal and by almost 55 percent in Hungary and Greece. Consumers in Austria, Germany, the Netherlands, the Czech Republic and Poland are more confident than the Russians - a 13-percent reduction of the index was registered there. The Swedes and the Finns stay absolutely calm against such a background and had their consumer confidence index decreased by 7 and 2 percent respectively.

Viewpoints articles include items drawn from international media opinion.