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Saturday, October 18, 2008

The Indian aviation sector looks set to shrink amid financial turmoil, with the nation’s air carriers in schemes to try and ride out the problems and domestic air traffic at a five year low.

Air traffic has fallen by 19% in September, the fourth month in a row of negative growth. The news comes as a joint result of the current financial crisis and high jet fuel prices, with Indian airlines in debt to the tune of Rs1,800 crore after surpassing their credit limits with oil companies, who are themselves making losses due to government controls on the price of jet fuel.

Kingfisher Red – originally known as Air Deccan, India’s first budget carrier, until Kingfisher Airlines bought the company out – suffered the biggest drop in passenger numbers at 20% of their load factor. Flag carrier Air India is running at 53% of capacity after a 10% fall, and the average for airlines is now 55% as opposed to 65% this time last year.

Kingfisher Airlines has decided to enter an alliance with Jet Airlines that will see them collectively control half the Indian aviation market. Both airlines are in debt over fuel payments with Jet owing Rs850 crore while Kingfisher refused to disclose the amount they needed to pay. The money is owed mainly to the Indian Oil Corporation, with the rest owed to the Hindustan Petroleum Corporation and the Bharat Petroleum Corporation. 45% of costs for Indian carriers is fuel, which is 70% more expensive than abroad due to multiple taxes.

Air India’s head Raghu Menon expressed concern about what the Kingfisher-Jet alliance meant for his own airline. “We were competing with both these airlines separately. Now we’ll be competing with them perhaps as one entity. It’ll be a challenge,” he said.

Kingfisher have cancelled an order for three A340 aircraft from European airframer Airbus. Airbus executive John Leahy said that Airbus had discussed the issue with Kingfisher before the choice was made and that this was the only cancellation from India. He also maintains that India will be an important area for Airbus, with the firm predicting Indian aviation growth will be at 9.7% compared to a global rate of 5.4%. Airbus predict that 1,000 new aircraft will increase the Indian fleet fivefold by 2026. Airbus have also welcomed the partnership between Jet and Kingfisher, saying it will help consolidate the carriers.

Airlines are cutting capacity to reduce costs, with around 20% gone already. Average flight movements are down to 8,000 a week compared to 10,500 in the period from April to June. The aviation industry in India is expected to post a collective loss of US$2 billion.

One executive at Boeing, Dinesh Keskar , predicted the downfall to be brief. “The current downturn in the sector is temporary and may not prolong for more than 6 to 9 months,” he said. Airlines, however, feel that the risk is very much immediate; Jet and Kingfisher are requesting a government bailout package worth Rs 40.7 billion. They are currently losing a combined US$1.3 billion.

Monday, March 21, 2011

Voters in Haiti are going to the polls today to vote for the country’s next president. The election follows months of political turmoil after the corrupt first round election in November caused a crisis requiring international intervention.

Haiti is still struggling to recover from the devastating January 2010 earthquake, with about one million people remaining in squalid, temporary shelters and a recent cholera epidemic which threatens to break out again with the return of the rainy season. Observers are hoping the new president will restore enough stability so rebuilding efforts can begin with international help.

In Haiti’s first round of balloting in November, names were missing from voter rolls, ballot boxes were stuffed or trashed, voters were blocked from the precincts by supporters of candidates, among other irregularities. Haitians rioted, plunging the process into chaos that was quelled by the determined efforts of foreign monitors.

Out of the original 19 candidates, two remained after the first round: Mirlande Manigat, age 70, a sedate, reserved university professor and wife of former president Leslie Manigat, and pop star “Sweet Micky” Martelly, age 50, who the The Washington Post described as being “a popular kompa singer […] famous for dropping his pants on stage, mooning audiences, and dressing in drag — or sometimes a diaper.”

However, Martelly has waged an energetic, well financed campaign with pink campaign posters picturing his smiling face and bald head, cultivating a populist image with Haiti’s poor. He has been successful at marketing himself as an unpretentious outsider who will shake up the political system and yank the country out of its paralysis. At the same time, he has courted the upper class with a platform containing pro-business promises and support for the return of the Haitian army.

The sedate personality of Manigat contrasts starkly with that of Martelly. She portrays herself as a dignified, mature mother figure able to nurture Haiti through its troubles.

The determining factor may be the popular former president Jean-Bertrand Aristide, who returned two days ago to Haiti from South America after seven years in exile. Aristide has not endorsed either candidate, but Aristide supporters, among those Haitians most desperately poor, have voiced support for Manigat. Upon Aristide’s arrival, there were banners saying, “My mother is here already. Welcome home Father”, according to The Washington Post.

Pierre-Marie Boisson, a private-sector economist in Haiti, sees the candidates as having similar platforms, promising jobs, housing and free education, even if their personal styles are so different. “They have both promised the moon to the voters,” he said. He noted that this puts tremendous pressure on the winner to produce results quickly in a world where the price of food and fuel is rising.

As voting concluded, despite some irregularities such as missing ballots and late starts, authorities concluded the voting went well, without the pervasive fraud that marked the November election. Colin Granderson, head of Organization of American States (OAS) observer mission, said the runoff election was a great improvement over the previous one.

The final results will be announced on April 16.

Saturday, April 30, 2005

The British Food Standards Agency (FSA) has announced a recall of foods containing banned dyes which increase the risk of cancer. The food products were sold at the Tesco, Waitrose, and Somerfield supermarkets.

A Bristol company called “Barts Spices” found the illegal Para Red substance in their Barts Ground Paprika, which was sold in 48g and 46g jars with a “Co-op” label. The batch codes on the affected products are 5032 and 5089 (expiration Dec 2007), and 5075 (expiration February 2007).

Tesco also found that their 130g package of BBQ rice cakes (expiration November and December 2005) contained both Para Red and Sudan I.

“It would be very prudent to assume that it could be a genotoxic carcinogen,” FSA scientific advisers told reporters.

“As a company committed to supplying only the very finest quality food ingredients, we took the immediate decision to withdraw our ground paprika spice from all outlets selling the product and advertised a product recall in the national press,” a Barts Spices spokesman said in a statement.

Sudan I is only authorized for industrial use to colorize petroleum products, such as shoe polish. Para Red and Sudan I are banned under the British Colours in Food Regulations of 1995.

Britain last went through a major food recall in February, when Worcester Sauce was found to contain chili powder dyed with Sudan 1.

Wednesday, March 3, 2010

Ford Motor Company said on Tuesday that its sales in the United States rose 43% in February compared to the same period last year, as the automaker outsold rivals Toyota and General Motors.

Ford said that total sales improved to 142,285 units, compared to 141,951 units sold by GM. Additionally, Ford said that its share of the total US car market rose to 17%, up from 14% a year ago. The increase was better than analysts had predicted, and Ford’s stock rose to a five-year high in morning trading, before declining later in the day. Ford’s sales were significantly influenced by a 74% increase in fleet sales to businesses. Rental car agencies alone accounted for around 30,000 units sold. Sales to retail consumers increased only 28%.

The increases were led by sales of two sedans, the Fusion and Taurus, which rose 166.5 and 93.3% respectively, although sales of other models such as SUVs and pickup trucks also increased. Both models were significantly redesigned last year, and analysts said that improved quality from such cars were driving the increases.

Other companies also reported February sales today, nearly all reporting sales gains as well, although none as large as those of Ford. Toyota was the sole exception to the sales gains, as their sales declined 8.7%, as the company was faced with a global recall during the month that led to a temporary stoppage of production for some models.

“The strength of our new products … are resonating with customers,” said Ken Czubay, Ford’s vice president of sales and marketing. However, he believed that traditional Toyota customers were not buying rival autos, but rather awaiting the results from the recalls.

Monday, April 14, 2008

This weekend, April 12–13, the joint Development Committee of the World Bank Group and the International Monetary Fund (IMF) held its annual Spring Meeting in Washington, D.C.

The Group of Seven (G7), which is comprised of the economic policy makers from the United States, United Kingdom, France, Germany, Italy, Canada, and Japan, held its annual meeting on Friday, April 11. This meeting, which rotates locations, was also held in Washington, D.C.

The Development Committee meeting ended on Sunday, with a call from the economic leaders for assistance to the countries which been adversely affected by rising food prices. Economic growth has slowed to its lowest rate in five years, while the rising costs of food and energy have not slowed.

Robert Zoellick, the president of the World Bank, said, “We have to put our money where our mouth is. Now. So that we can put food into hungry mouths. It’s as stark as that.” He called for US$500 million in emergency funds for the United Nations’s World Food Programme by May 1, 2008.

“All that has been done [in the past decade] can be undone very rapidly by the crisis coming from the increase in food prices,” said Dominique Strauss-Kahn, the managing director of the IMF.

“Children will be suffering from malnutrition, with consequences for all their lives,” he said. He cited the growing use of land for biofuels as contributing to rising food costs. In the end growing violence and civil unrest could be a result.

Strauss-Kahn further warned that eventually it could become “not only a humanitarian question,” but could also affect developed nations by leading to trade imbalances.

Specifically cited as a current example, was Haiti, where just this weekend, violence escalated resulting in the death of a United Nations peacekeeper and the ousting of Prime Minister Jacques-Édouard Alexis.

United States Secretary of the Treasury Henry Paulson cautioned that affected countries “need to resist the temptation of price controls and consumption subsidies that are generally not effective and efficient methods of protecting vulnerable groups.”

Price controls and subsidies “tend to create fiscal burdens and economic distortions while often providing aid to higher-income consumers or commercial interests other than the intended beneficiaries,” Paulson said.

In their Friday statement, the G7 said “there have been at times sharp fluctuations in major currencies, and we are concerned about their possible implications for economic and financial stability.” This marked the first time since the February 2004 meeting in Boca Raton, Florida, that the wording on foreign exchange has been altered.

The G7 presented a plan to strengthen regulation of capital markets. They urged financial firms to “fully” disclose their at-risk investments and improve capital reserves. While the G7 did not outline new monetary or fiscal policies, it did promise action “as appropriate.” The timetable for the plan is 100 days.

The head of G7 Market Economics at Tullett Prebon, Lena Komileva, observed, “The implicit message is that the G7 is moving closer towards concerted action in the event that persistent volatility in the foreign exchange market presents new risk of systemic failure in the financial industry.”

“While action is unlikely in the short run, they are probably already considering a pre-emptive move in foreign exchange markets to slow the dollar’s decline,” added Komileva.

Economists at Goldman Sachs told their clients, “After a period where the possibility of G7 policy intervention seemed very remote, providing no counterweight to the dollar depreciation forces, we are moving towards a regime where G7 intervention is a more real possibility.”

Tuesday, November 16, 2010

China’s Xinhua News Agency said Tuesday that at least 53 people were killed in Shanghai during a deadly fire. The blaze, which occurred on Monday at 2:15 p.m. CST (0615 UTC), consumed a 28-story high-rise apartment building in the city’s Jing’an District.

The building was being renovated at the time of the fire, and was home to over 150 families. At least 100 victims have been admitted to area hospitals, although some later died. Most survivors were not seriously injured, but needed treatment for smoke inhalation. Firefighters were still looking for survivors and over 70 were still hospitalized on the morning after the fire.

The fire was the worst in recent Shanghai history and took over 100 fire engines more than four hours to contain. Strong winds blew heavy smoke into the air, hampering rescue efforts by helicopters. The smoke was seen by witnesses around 15 kilometres (9.3 miles) away from the high-rise. The fire was largely extinguished by 6:30 p.m. local time (1000 UTC), allowing fire and rescue officials to enter the building.

The apartment building, built in the late 1990s, was home to mainly retired teachers. Some residents climbed down the scaffolding to escape, while others called for help but were unable to flee the blaze. “I saw at least four or five people hanging onto the scaffolding which covers the building, screaming for help,” said Li Qubo, who was working near the high-rise.

The cause of the fire has not yet been determined, but local residents said fire safety regulations were not strict, and workers often tossed used cigarettes into the building’s hallways. Qiu Jingshu, a 38-year-old worker who was outside the 18th floor when the fire struck, said he saw sparks from welding being done on an adjacent building fly over onto the high-rise. The sparks lit up foam on the scaffolding around the apartment, according to Qiu. “We had tried to put out the blaze, but the fire was so big and spread so quickly that we could barely escape ourselves,” he said. Crews were said to have been installing insulation at the time of the fire, and witnesses saw construction materials on fire before the building was overtaken by flames.

Two nearby buildings were evacuated, and their residents were temporarily sent to local hotels, and a school. Meng Jianzhu, China’s Minister of Public Security, said that an investigation would determine who was responsible for the fire, so they could be punished accordingly. Meng said that a team had been formed under China’s State Council to look into the disaster.

A similar incident occurred in Beijing early last year. In February 2009, the illegal use of fireworks caused a fire that gutted a 34-story building under construction at the time.

Shanghai has a population of about 20 million, housed mainly in high-rise apartments. Many buildings in the city are under construction or being renovated.

Wednesday, March 22, 2006

Two explosions were heard in the city of La Paz, Bolivia on Tuesday night, March 22 and in the early morning Wednesday, March 23. The first occurred at the Linares Motel, at 21:50 (01:50 UTC), and left two people dead and four injured. The second explosion occurred at 01:45 (05:45 UTC) at the Hotel Riosinhio II, less than a block from the La Paz bus terminal, injuring two people.

Hours later, two suspects in the crime were arrested by the police in the city of El Alto. They were American Claudio Lestat, approximately 30 years old (25 according to some sources) and his partner, Uruguayan Alda Ribeiros, of 35 years (40 according to other sources). Dynamite was used in both explosions, according to government attorney Jorge Gutiérrez.

President Evo Morales indicated that the promoters of the incidents were “industrialists” and “oligarchists” who, “using external agents”, claimed to halt the reforms that have been happening in Bolivia. He also suggested that the United States could be behind the incidents: “Is there an effort against terrorism from the government of the United States, or did they send North Americans to commit terrorism in Bolivia?” Despite the accusations, the United States embassy in La Paz announced its cooperation.

However, authorities have not ruled out religious motives, because Lestat is a self-proclaimed “minister of pagan rites”. Police also announced that the Chilean consulate in the Bolivian capital was also a target, to be attacked on Saturday the 25th.

Names and ages of the victims of the explosions are: Marlene Patzi Tapia (26), Cristian López (26), Alva Natividad Heredia (44), and Jessica Wilson (24), the last from the United States. Also affected were Marco Antonio Romero Galindo (20), Iván Quiroga (27), Elizabeth de Quiroga (44) and Ximena Vargas (18).