Vice Chairman of China's National Parliament Cheng Siwei

WASHINGTON, Nov. 11--Amid a plunging US dollar, China has again threatened to diversify its mountain of dollar foreign reserves but US officials are unperturbed while experts do not see a rapid shift by Beijing.
A senior politician as well as a state banker in China last week both underscored the need for Beijing to shift part of its $1.4 trillion in reserves toward presently stronger currencies, like the euro, AFP wrote.
Comments particularly by Cheng Siwei, vice chairman of China’s national parliament, that strong currencies ought to be given more weight in the Chinese reserves to offset the losses in weak ones, sent the greenback into a tailspin.
While China plans to gradually decrease its relative reliance on the greenback as a backstop currency, it is unlikely to do it in a rapid fashion, analysts say.
“Beijing is not about to shoot itself in the foot by carrying out a mass sell-off of greenbacks,“ Stratfor, a private US intelligence firm, said in a bulletin to clients. Such a move would wipe out much of China’s foreign reserves “in less than the blink of an eye“, it said, adding that Beijing wanted “just to slow or stop its purchase of new batches“ of the greenback.
But the latest Chinese suggestions do point to imminent changes in Beijing’s method of currency reserve management--changes being discussed in top Chinese political circles--such as investing in assets with higher rates of return, like the euro or other investment instruments such as equity or energy assets, Stratfor said.
To date, only 200-400 billion dollars of China’s foreign currency reserves have been designated for spending elsewhere--notably below the $650 billion threshold suggested in March.
US financial and economic czars were unperturbed by the latest reports on Beijing’s reserves diversification plans, underlining the dollar’s status as the dominant reserve asset and traditional safe-haven currency.
Cheng’s remarks sent tongues wagging in the US Congress, which has often been critical of Beijing’s refusal to make its yuan currency more flexible.
At a Congressional hearing on the American economic outlook, Federal Reserve Chairman Ben Bernanke was asked to comment on the reports of Beijing reserves switch from the dollar. Bernanke said, “I’m not particularly concerned about any major change in the (reserves) holdings of China or any other country.“

HONG KONG, Nov. 11--Previous troubles in the US economy have caused Asia to skid badly--but analysts think the region has matured enough to get through any bleak days ahead for the United States.
In the past, woes in the world’s biggest economy have hit Asian exports, robbing funds for investment and leading to a fallback across the region, said Andy Xie, an economist and former Morgan Stanley analyst in Shanghai.
“A lack of money leads big projects to be postponed, giving rise to a vicious cycle. But this is the first time in history that emerging economies don’t have such constraints,“ Xie told AFP.
Now, he said, Asia has built up huge foreign exchange reserves worth trillions of dollars, providing a buffer to fund those big infrastructure projects and break the cycle.
The reserves, amounting to $1.4 trillion in China alone, have accumulated because of trade surpluses and a stampede of foreign investment. “China will continue to grow regardless,“ Xie said.
The United States could be facing a sharp slowdown due to the credit crunch and sliding property market resulting from a mortgage default crisis, which along with record oil costs could weigh on its usually spendthrift shoppers.
Those concerns have rattled world stock markets, including in Asia, but many experts feel that the region’s fortunes are to some extent now standing on their own.
“You can definitely make the case that a large part of the Asian economies have decoupled from the US,“ said Pierre Gave, the head of research at economics consultancy GaveKal.
“The big difference is the amount of infrastructure spending. I would definitely say Asia is less export-dependent on the US,“ the Hong Kong-based analyst said.
He estimated there was $800 billion of infrastructure spending in Asia this year, providing the region with a bigger growth impetus than the US consumer.
“Asian economies have the money to do it, including a lot of foreign exchange reserves,“ he said.
China, and to a lesser extent India, are also helping to drive trade within Asia, analysts say.
“People are starting to see all the regional economies around China and India have growth prospects less and less linked to the US and more dependent on intra-regional trade,“ said Matt Robinson of Moody’s Economy.com.

Boeing hopes to bag orders for up to 150 new aircraft from the Middle East region by the end of 2007.

DUBAI, UAE,
Nov. 11--Boeing Co. won an Emirates airline order on Sunday for 12 of its 777-300 aircraft in a deal worth $3.2 billion, Lee Monson, senior vice-president for Middle East and Africa sales at Boeing said, Reuters reported.
Also, Emirates said on Sunday that it had ordered 70 midsized A350 XWB (Extra Wide Body) aircraft from Airbus with an option for 50 more.
Boeing said Saturday it was hoping to bag orders for up to 150 new aircraft from the Middle East region by the end of 2007. “We will try to finish the year with 150 (aircraft) orders from the region,“ Boeing’s Middle East chief of commercial airplane sales Lee Monson told reporters here on the eve of the Dubai Air Show, AFP reported.
Monson refrained from disclosing details of orders or clients saying that the five-day exhibition--the world’s third largest air show--will see major announcements.
He said an announcement for one big order for the Boeing 787 Dreamliner will take place during the week, without giving further details.
Only a single order for 22 aircraft placed by Kuwait’s leasing company ALAFCO appears on Boeing’s order book from the region for 2007.
Dubai has joined Paris and the UK’s Farnborough air shows as a major battleground for planemakers Boeing and Airbus thanks to rapidly expanding Persian Gulf-based airlines such as Emirates, Etihad and Qatar Airways, Reuters wrote.
The biennial Dubai event saw deals worth $21 billion announced two years ago, a level it will easily top this time should the Emirates deal come through.
UAE budget carrier Air Arabia based in Sharjah is among the other airlines expected to announce new business. Chief Executive Adel Ali told Reuters this month the airline was looking for up to 50 planes in a deal worth about $4 billion at list prices.
The Persian Gulf Arab region is a hot market for business jets as well and the Dubai air show is expected to see Bombardier, Gulfstream and other makers announce new business, as well as the most high-profile outing to date for the Eclipse 500.

ROME, Nov. 11--Italian Prime Minister Romano Prodi called for action Saturday to avoid an “irreversible crisis“ following European Commission forecasts of weak growth next year.
The commission Friday predicted that Italy’s gross domestic product would increase by only 1.4 percent in 2008 and 1.6 percent in 2009, the lowest growth in the 13 nations using the euro as a common currency.
It said European economic growth would be weaker than previously expected next year, with an average of 2.2 percent, blaming distressed financial markets, a relentless rise in oil prices and a weakening US economy.
In the broader 27-nation European Union, economic growth was forecast to slow from 2.9 percent this year to 2.4 percent in 2008.
“Because of its divisions, Italy has become a static society,“ ANSA news agency quoted Prodi as telling a meeting of the new centre-left Democratic Party in Bologna.
“The duty of the Democratic Party and the government is to restore movement to society,“ Prodi said. “If Italy does not progress like other countries, the crisis will be irreversible.“

Pilot mining at an Hampton Court ResourcesÕ concession in Ecuador

SANTIAGO, Chile, Nov. 11--Hoping to inject life into the country’s lackluster mining industry, Ecuador President Rafael Correa said in an interview with Reuters on Saturday he would revoke concessions on properties that are not being exploited.
Correa also said he plans to renegotiate current terms with companies that are exploring for minerals in the Andean country.
Ecuador is in the heart of mineral-rich South America, but it has little real mining output, in part because speculators have bought up thousands of concessions and are holding them in the hopes of selling them at a higher price in the future.
“There are five or six companies that are producing, and we’ll negotiate with them, but we will revoke the concessions from the rest of them,“ Correa said on the last day of a three-day summit of Latin leaders in the Chilean capital Santiago. He did not mention the companies by name.
Mining concessions in Ecuador are currently cheap to hold, subject to a low and renewable annual ownership fees.
Ecuador is also working to establish contracts between the government and mining companies that will set royalties at a referential price for the mineral extractions. But, mining firms will have to share part of their windfall revenues if metals’ price rise in the market.
Mining companies currently have no contracts with the government and do not pay royalties.
Canadian companies such as Corriente Resources, Iamgold Corp and Aurelian Resources are exploring for gold and copper in Ecuador.

SINGAPORE, Nov. 11--One of the objectives of the ASEAN Economic Blueprint will be to modernize the group’s commerce and economic systems to facilitate a better flow of people and goods between countries.
Leaders from the ten member countries will sign and adopt the document at the Singapore Summit which kicks off later this month, Google News reported.
In an interview with Channel NewsAsia ahead of the Summit, ASEAN’s Secretary General Ong Keng Yong said that the blueprint would also help the lesser developed ASEAN economies socialize and integrate faster into the global marketplace.
An important reason for the formulation of the ASEAN Economic Blueprint will be concern about the regional grouping’s competitiveness and the speed at which large economies like China and India are growing. Ong explained, “As they always say in China and in India, we only need to pass one customs checkpoint. But in ASEAN, we have ten different countries and different customs authorities and ten different borders where we have to pay transactional costs when we bring in or out our goods. All these bring up the costs of transactions. “
“So what we are saying is that if we want to compete with the bigger economies, the ten borders that we have should become one for the purpose clearing our goods and services. And also for the purpose of facilitating a flow through of business people, investors and talented people. So we believe that this integration is essential to make our competition more effective.“ So the economic blueprint has specific timelines for key areas of work to be done. One area is facilitating the movement of professionals.
The ASEAN Secretary General acknowledged that the group’s economic integration process would not be successful, if there is not a strong political will by the leaders of the countries to achieve what has been set out in the blueprint document. And this will to strengthen ASEAN’s voice and identity in the global community has been clearly demonstrated in the decision to come up with the ASEAN Charter.
Ong continued that the ASEAN Charter is ready for the leaders to adopt and sign.
He concluded, “Doing this Charter shows the determination of the ASEAN countries to show that the ASEAN member countries are prepared to rally behind a very important document which is our Constitution.“

JOHANNESBURG, South Africa, Nov. 11--Top officials from South Africa’s premier agricultural lender have siphoned off more than two billion rand ($301.4 million/205.4 million euros) meant for farmers, AFP reported.
Officials from the Land Bank allegedly used the money to fund projects led by their friends and relatives involving luxury golf estates, a sugar mill, horse farms and residential developments, The Sunday Times said.
The fraud was revealed in a forensic audit report by Deloitte, which was handed to the cabinet last week by Land Affairs Minister, Lulu Xingwana, it said. There was no independent confirmation of the report.
The unapproved loans to fund these ventures led the South African cabinet to call for the sacking of the Land Bank board and for criminal charges to be brought against those indicted by the probe.
Some Land Bank officials were suspended last week while others are facing an investigation.
Xingwana was set to announce a new board by this week, the report said.
The Land Bank was set up to develop the farm sector and support the emergence of black farmers and reverse historical land-owning imbalances stemming from decades of white-minority rule which ended only in 1994.
While the government promised to redistribute 30 percent of white-owned land by 2014, less than five percent has been transferred into black hands since the demise of apartheid.
The Land Bank has come under sharp criticism over the past months for poor debt management, financial irregularities and a dismal rate of return from loans.
In October the South African government recapitalized the ailing financial body with an injection of 700 million rand and ordered it to adopt new strategies.