TOKYO, Feb. 5--The world needs to invest more than $2 billion (1.35 billion euros) in irrigation, roads and other rural development in Afghanistan to lure farmers away from booming opium cultivation, a development bank report said Tuesday.
The report, by the World Bank and Britain-based Department for International Development, argued that the drug trade--Afghanistan’s top business--can only be combated if impoverished farmers have other means of making a living, AP wrote.
“Only as poor Afghan farmers gain other economic opportunities they will be able to be weaned away from dependence on opium production over time“, William Byrd of the World Bank told reporters in Tokyo, where the report was released on the sidelines of an annual international conference on the country’s reconstruction.
The report called for the boosting of community-based development projects, expanded irrigation, increased use of livestock, and help for rural businesses and entrepreneurs.
It recommends investments of $1.2 billion (810 million euros) to expand irrigated land, $550 million (370 million euros) to boost rural enterprise development, and $400 million (270 million euros) for rural road planning, construction and maintenance.
The money would be spent over up to 10 years, depending on the program. The report’s authors also called for greater coordination among Afghanistan’s donors, who they said had failed to use their money in complementary ways.
Afghan Foreign Minister Dadfar Spanta, along with a group of other Afghan ministers, is in Tokyo for the meeting of the 24-member Joint Coordinating and Monitoring Board, established to monitor implementation of the Afghanistan Compact, adopted at a London conference in January 2006.
The compact is a five-year blueprint between the international community and the Afghan government to promote security, good governance, the rule of law, human rights and economic and social development in Afghanistan, as well as to fight the drug trade.

The single European currency was traded Monday for $1.4827.

LONDON, Feb. 5--The euro gained ground on the dollar here Monday as traders predicted the European Central Bank would maintain its key interest rates at current levels at a meeting on Thursday.
The single European currency in late-day trade was at $1.4827 after $1.4796 late Friday in New York, AFP wrote.
On Thursday the European Central Bank (ECB) and the Bank of England (BoE) reveal their latest moves, with the ECB seen on hold at 4.00 percent and the BoE fully expected to cut by a quarter point.
While stubborn eurozone inflation is likely to induce the ECB to leave rates where they are, analysts nonetheless believe the bank will cut the cost of borrowing later in the year as growth risks increase.
“Our central forecast remains one of rates on hold for the foreseeable future, but risks are skewed to the downside and it is possible to envisage cuts occurring towards the second half of the year,“ analysts at Goldman Sachs said.
The Bank of England is fully expected to cut its benchmark rate by a further quarter point on Thursday to 5.25 percent following December’s quarter-point reduction.
Also Monday central European currencies strengthened as investors bought into riskier emerging assets.
The Czech koruna hit a record level of 25.66 to the euro, reflecting a healthy local economy and expectations of tighter monetary polices from the central bank.
The Polish zloty and the Hungarian forint were also markedly stronger.
“There’s better sentiment toward riskier assets right now, and the koruna is following the trend,“ said Tomas Vlk, an analyst with Patria Finance in Prague.
In Europe on Monday, the euro changed hands at $1.4827 against $1.4796 late Friday, 158.34 yen (157.79), 0.7498 pounds (0.7530) and 1.6160 Swiss francs (1.6124). The dollar stood at 106.78 yen (106.33) and 1.0901 Swiss francs (1.0894). The pound was at $1.9776 (1.9649).
On the London Bullion Market, the price of gold fell to $893.75 an ounce from $914.75 late on Friday.

DUBAI, UAE, Feb. 5--The United Arab Emirates is likely to revalue its currency against the flagging dollar in a bid to bring down inflation and meet criteria for a single Persian Gulf Arab currency, an industry report said on Monday.
It is “most likely that the UAE central bank will revalue the dirham against the US dollar in line with other Persian Gulf Cooperation Council (PGCC) currencies,“ the Dubai Chamber of Commerce and Industry (DCCI) said.
“This will help to some extent in alleviating inflationary pressures whilst retaining adherence to the dollar peg stipulated as an integral part of the convergence criteria necessary for a (Persian Gulf) MU (monetary union) in 2010,“ it said in the report received by AFP.
The dollar is worth 3.67 dirhams, the rate used for the past decade.
Oil-rich PGCC member states Bahrain, Kuwait, Qatar, Saudi Arabia and the UAE have set 2010 as the target date for adopting a monetary union and single currency.
Oman, the sixth PGCC member, has said it will not join, at least at the initial stage.
The DCCI said that while PGCC states have met several convergence criteria in preparation for monetary union--including levels of public debt, budget deficits, interest rates and foreign reserves--the criteria set for inflation rates have not been satisfied.
“The disparities in inflation rates undermine the convergence of economies in real terms, especially with regards to interest and exchange rates,“ it said.
Since May, when Kuwait dropped its dollar peg and adopted a basket of currencies, there has been constant speculation that the UAE and Qatar would follow suit or revalue their currencies.

Swiss watch exports as a whole grew 16.2 percent to 15.96 billion Swiss francs, with particularly strong demand from Hong Kong.

ZURICH, Switzerland, Feb. 5--Switzerland’s watchmakers and other luxury goods makers are set for further growth in 2008 as strong demand in Asia and the Middle East offsets economic gloom in the US and Europe.
Swatch chairman Nick Hayek struck a bullish note in a weekend interview, telling the Finanz und Wirtschaft newspaper he expects the company’s sales to grow to 10 billion Swiss francs ($9 billion, 6 billion euros), AFP wrote.
Swatch posted sales of 5.9 billion Swiss francs in 2007. Hayek did not specify when he expects sales to reach the 10 billion SWISS franc mark.
The company’s Tourbillon, Blancpain, Breguet, Swatch and Omega brands recorded sales in the first half of January 2008 that were higher than the figure for the whole of the same month a year previously, he added.
However it is not only Swatch but also competitors such as Richemont who can afford to face the new year with confidence while other sectors fret about a looming downturn, analysts said.
John Cox, a luxury goods analyst at Swiss bank Landsbanki-Kepler, said that any downturn will only hit sector players in the second half, as at present their order books are still chock full.
New-found wealth and consumer demand in Asia and the Middle East should also prove a boon to luxury goods makers fearing a slump in other Western markets, analysts said. “Growing prosperity, international tourism, the ’democratization’ of luxury and the need for social status“ have all fuelled demand in recent years, Zuercher Kantonalbank analyst Patrik Schwendimann said. “New markets in China, Russia, the Middle East and, eventually, India“ will serve as the motors for future growth, he added.