theSun | TUESDAY APRIL 7 2009 13

business

Japan PM orders US$100bil

economic stimulus
TOKYO: Japan plans fresh stimulus of stimulus measures unveiled since nations to lift stimulus spending to at
spending worth at least US$100 bil- October that were worth a combined least 2% of GDP, or annual economic

lion (RM360 billion) to rescue Asia’s
biggest economy from its worst crisis
since World War II, the finance minis-
ter said yesterday.
Prime Minister Taro Aso has called
for an extra budget of at least 2% of
gross domestic product (GDP) for the
2009 financial year starting this month,
Finance Minister Kaoru Yosano told
reporters. That would make the pack-
age worth ¥10 trillion (US$100 billion)
or more.
Aso first announced last month
plans for a new boost to the economy,
but he did not say at the time how
much it would be worth.
The latest package comes on top
¥75 trillion (RM2.7 trillion), of which
actual fiscal spending was about ¥12
trillion (RM432 billion).
Japan’s economy logged its worst
performance in almost 35 years in the
last quarter of 2008, contracting at an
annualised pace of 12.1%. The govern-
ment has described the economic crisis
as the worst since WWII.
The new package is expected
to include measures to help laid-off
workers, aid cash-strapped compa-
nies secure access to credit, improve
healthcare and to encourage greater
use of solar energy technologies.
The new boost follows a call by
the International Monetary Fund for
output.
Japan’s economy has been badly
hurt by the global economic down-
turn, which has caused its exports to
halve over the past year as demand for
its cars and hi-tech goods dries up.
Major manufacturers have cut
back on production and slashed tens
of thousands of jobs since the crisis
began. Unemployment in Japan hit a
three-year high of 4.4% in February.
Yosano did not say whether the
government would issue more bonds
to finance the additional spending.
Japan already has huge public debts
– a legacy of Tokyo’s efforts to spend its
way out of the 1990s recessions. – AFP
briefs
AirAsia
to fly to
Chengdu, HK court approves US$2.1bil
Xian PCCW buyout bid
pg 14 HONGKONG: Tycoon Richard Li’s tortuous struggle to
privatise his telecoms giant PCCW finally got the green
light yesterday, despite claims by Hongkong’s financial
watchdog a shareholder vote was rigged.
Li’s US$2.1-billion (RM7.56 billion) bid to take Hong-
kong’s largest fixed-line operator into private hands was
cleared by the city’s High Court, three years after the
chairman first moved to buy out the firm.
The son of billionaire Li Ka-shing, the younger Li has
faced shareholder ire and an investigation by the Securities
and Futures Commission (SFC) in the latest battle.
High Court justice Susan Kwan gave the scheme the
go-ahead following a two-day hearing last week where the

World stocks rally on record HSBC rights issue
LONDON: Global stocks marched
upwards yesterday when senti-
ment was boosted by pre-week-
end gains on Wall Street and
record demand for HSBC bank’s
historic rights issue, dealers said.
Markets had shrugged off
North Korea’s launch on Sunday of
a long-range rocket, which passed
over northern Japan without inci-
dent, they said.
In early trading, the London
market added 1.49%, Frankfurt
won 1.54%, Paris advanced 1.57%
and Madrid increased by 2.15%.
Europe raced ahead after a
string of gains across Asia, with
Tokyo up 1.24% and Hongkong
adding 3.11%.
Japan’s Nikkei stock index
struck a fresh three-month high,
boosted by pre-weekend US gains
and a weaker yen, which is good
for exporters.
“Markets (in Europe) opened
higher this morning led by a move
on the Hang Seng,” said Nick Serff,
market strategist at spread-bet-
ting firm City Index.
“Shares in HSBC hit a five-week
high after stronger-than-expected
demand for its record rights is-
sue.”
Over the weekend, Europe’s
biggest bank announced a 96.6%
take-up for its record US$17.7 bil-
lion (RM63.72) rights issue which
was launched last month after a
plunge in profits.
In London yesterday, HSBC
shares leapt 6.16% to 461.25
pence as investors welcomed the
news.
HSBC, which has refused British
government financial assistance
in contrast to rivals such as Royal
Bank of Scotland and Lloyds, had
reported a 70% plunge in annual
net profits last month.
Before the weekend, New York
stocks had shrugged off a dismal
March jobs report to end higher
Friday, capping their fourth weekly
gain amid market expectations
that the economic contraction is
easing.
The Dow Jones Industrial
Average rose 0.50% at 8,017.59,
closing above the psychological
8,000 level for the first time since
Feb 9.
“The major European indices
are looking at another strong start
to the week after Asian markets
shrugged off Sunday’s North Ko-
rean missile launch, whilst the fact
the DOW also re-took the 8,000
level ahead of the weekend break
will add to the air of confidence,”
said CMC Markets analyst Jimmy
Yates.
“However as we approach the
long Easter weekend ... volumes
could be expected to come off a
little so meaningful direction may
prove difficult to find whilst volatil-
ity could edge higher too.”
The market in Syndey gained
0.56% and Taipei closed up
0.48%.
Tokyo’s benchmark Nikkei-225
index surged to finish at 8,857.93
points – which was the highest
close since Jan 8.
“The Japanese market is now
at a turning point,” Investrust CEO
Hiroyuki Fukunaga told Dow Jones
Newswires.
If the Nikkei can hold firm after
the current buying to exit sell posi-
tions ends, “that would be a signal
for further upside,” he said. – AFP
SFC claimed a February shareholder vote which approved
the deal had been manipulated unfairly.
She said there was no substantial evidence that the
vote had been rigged and the SFC’s argument was “merely
suspicion”. – AFP
Singapore vows law change
to remove tax haven tag
SINGAPORE: Singapore has vowed to amend its tax
laws within the year after being named in a list of
countries that have not yet fully implemented global
standards aimed at eliminating tax havens.
The Organisation for Economic Co-operation and
Development (OECD) last week said Singapore was
one of the countries that had not yet carried out
their commitments to respecting global standards
on exchanging tax information.
Singapore “intends to implement the standard by
effecting legislative amendments later this year,” the
finance ministry said in reply to a query from AFP.
The OECD, which groups the world’s leading devel-
oped nations, listed 38 countries and territories that
“have committed to the internationally agreed tax
standard, but have not yet substantially implemented”
the measures. – AFP