Impatience With Obama Trade Policy Grows

By THE ASSOCIATED PRESS

Published: November 25, 2009

WASHINGTON (AP)- The third anniversary of the signing of the U.S.-Colombia free trade pact came and went this month with the Obama administration still negotiating the fine print, Congress showing little interest and business groups frustrated by the lack of action on trade deals.

''For most of 2009 we were willing to sit on our hands'' as the new president struggled with the recession and health care, said Bill Lane, a government affairs official for Caterpillar Inc.

''We can't maintain that anymore. It's time we started moving forward,'' said Lane, who is also corporate co-chairman of the Latin American Trade Coalition.

Critics of President Barack Obama's trade policy point to the failure by Congress to act on the three bilateral free trade agreements -- with Colombia, Panama and South Korea -- signed during the George W. Bush administration.

They say delays in implementing those pacts, under which those three countries would cut tariffs and remove barriers to U.S. goods and services, have cost the United States billions of dollars and hundreds of thousands of jobs.

Lane said the United States has paid Colombia $2.3 billion in tariffs since the agreement was reached three years ago. A report prepared for the U.S. Chamber of Commerce estimated that 383,400 American jobs could be affected if the U.S. continues to do nothing while the European Union and Canada proceed with trade agreements with Colombia and South Korea.

''The U.S. risks getting stuck on the outside looking in,'' said John Murphy, the chamber's vice president for international affairs

The last free trade agreement approved by Congress was (To read the full article, click here).

Foreign Direct Investment in Pakistan Fell 53.2% in Four Months

By Farhan Sharif

Nov. 18 (Bloomberg) -- Overseas direct investment into Pakistan dropped 53.2 percent in the first four months of the fiscal year that started July 1, the central bank said.

Investment in July-October period fell to $621.8 million from $1.33 billion a year ago, according to an e-mailed statement from the Karachi-based State Bank of Pakistan. Global funds bought $288.4 million more Pakistani stocks than they sold in the four months, compared with net sales of $173.9 million a year earlier, the central bank said.

Pakistan needs overseas investment to (To read the full article, click here).

Business this week

Nov 19th 2009
From The Economist print edition

Ben Bernanke remarked that the Federal Reserve was “closely” watching currency markets, and that the central bank would “help ensure that the dollar is strong." The weak dollar has caused commodity prices to nudge up, a potential inflationary threat. Any opinion from the chairman of the Fed regarding the value of the greenback is controversial because the Treasury handles exchange-rate policy.

Dominique Strauss-Kahn, who heads the IMF, called on China to let the yuan appreciate, “the sooner the better”. China tightly controls its currency by pegging it to the dollar—benefiting domestic exports—and has so far resisted pleas to allow it to rise. See article on China's Yuan Strategy.

Opening the vault

Around 14,700 people disclosed their foreign holdings to the Internal Revenue Service under a recent amnesty, twice as many as expected. Meanwhile, the procedure for selecting which “secret” accounts at UBS are to be disclosed to American authorities was made public. Americans with at least SFr1m ($991,000) in accounts suspected of being used for tax evasion at the Swiss bank between 2001 and 2008 will have their names handed over, as will those with lesser amounts but where a “scheme of lies”, such as using fake documents, has been used to open an account.

Lloyd Blankfein, the chief executive of Goldman Sachs, apologised for his bank’s part in fuelling the market for cheap credit that led to the financial crisis. To aid the recovery, Goldman launched a scheme to help 10,000 small businesses, to which it will donate $500m over five years. Some were left unimpressed; Goldman pulled in at least $100m on 36 separate trading days in the third quarter and on 46 days in the second quarter. It has set aside $16.7 billion for pay and compensation so far this year.

Mitsubishi UFJ unveiled plans to raise up to ¥1 trillion ($11.2 billion) through a sale of common stock, the biggest ever share sale undertaken by a Japanese financial institution. Its plans to merge with Morgan Stanley’s Japanese unit were also scaled back.

The euro zone exited recession in the third quarter when its economy grew by 0.4%, after contracting for more than a year. Among the big economies that (To read the full article, click here).