Ruling Russia
The seven men
who really count
p- "* 18
Friends of Bill
Clinton toasts Gingrich
and Greenspan
UmiIi
World Business Newspaper http://vvww.FT.com
Page 18 Philip Stephana, Page 14
FRIDAY NOVEMBER 1 1996
Zaire’s army faces Russian gas group to raise up to $5Q0m t&
defeat as Tutsis ^ • g*
advance on Goma CjrJIZprOIII JIUXIS lOt
Zaire's army was faring a humiliating defeat as
Tutsi fighters advanced on Goma, capital of
north Kivu. The Tutsis, suspected of belonging
to the Rwandan army, are on the verge of seiz-
ing a swathe cd east Zaire, putting them in a
position to dictate terms to the Zairean authori-
ties. The country is seemingly paralysed by the
absence of President Mobutu Sese Seko, who Is
being treated in Switzerland for prostate cancer.
Page 16
At I— »t 08 dead as aircraft hits houses
By Join '
Andrew!
til and
fin Moscow
Gazprom, th
gas concert
become
panyjg^^t
ket jfcc th
n, thArorld’s biggest
ace mf* g planning to
tiyl lirst Russian cam-
the eurobond mar-
cs the collapse of the
Sovagt Union.
/The move could presage a
Rood of similar issues by Rus-
sian borrowers. .
The company, which in
October received $429 -3m from
an international share offer, is
expected to raise between
$250m and $500m to finance
investments to strengthen its
already dominant hold on the
European gas TwarVAt-.
With the eurobond, Gazprom
i intends to test the market for
an aggressive capital-raising
programme in the coming
months. The eurobond move is
likely to come swiftly after a
Russian sovereign bond Issue
planned for later this month.
Mr Alexander Livshits, the
finance minister, said yester-
day he stm expected the sover-
eign eurobond issue to come
during November.
This is despite fears over
President Boris Yeltsin’s
health, and the breakdown of
talks with the International
Monetary Fund over the dis-
bursement of the latest
tranche of the government’s
$10.2bn budget rapport loan.
“As a matter of principle we
do not want to have a mass
issue," he said. “We will have
Power behind throne - — Jap* 15
Eurobond* -- 24
a small issue with a low yield.
We want the first Russian
bond issued abroad to have a
respec ta ble status."
Mr Livshits said hfe hoped
the IMF would resume disburs-
ing its credit after a review 1 of
Russia's progress in collecting
t uTftg in mid-November.
The sovereign debt Issue la
seen as a milestone in Russia's
re-integration into the world
economy, following agree-
ments In principle with the
Paris and London clubs of offi-
cial and commerciaT bank
creditors to reschedule its
debts. It. and the Gaijirom
issue, could dear the way for
the rapid development of a cor-
porate bond market, opening
up a new source of capital for
- the country’s biggest priva-
tised companies.
Several of Russia's munici-
pal authorities, . including
Moscow, St . Petersburg, and
Nizhny Novgorod, are also
planning to issue debt finance
abroad.
Mr Alexander Semenyaka,
the Gdzpram. director responsi-
ble for raising capital, said the
company needed *4Qbn to
by a variety of means through 1
project fibftbee and the issue of ,
shares and bonds," be said.
Mr Semenyaka said Gaz-
prom .bad- to look abroad to
raise' finance because of the
underdevelopment of Russia's
own capital markets.
It would sell more equity to
foreign investors following
publication of internationally'
acceptable accounts next sum-
mer. The Russian government
has agreed that 9 per cent of
Gazprom's equity- can be sold
abroad,
Gazprom's placement of 1.15
exploit Its vast reserves In the per cent of its shares abroad
Yamal peninsula, and could Was heavily oversubscribed by
not finance the. project solely
through cash flow.
“We will. finance these heeds
International investors, sug-
gesting there could be strong
demand for II eurobond.
All 95 passengers and crew cm board a Fokker
F-100 ea route to Riotjde Janeiro were killed
when It crashedshortly after take-off from Sao
Paolo airport. True aircraft, operated by Brazil-
ian airline TAm, clipped two blocks of flats
before crashing into houses two miles from the
airport. Rescue workers (above) said at least
three peonjie on the ground were killed. Page 4
Siena Ad ips Into radi Stena Line, the world's
Ibrgesjc ferry operator, blamed competition on
the Rfagiish C hann el and delayed ship deliveries
for y a SKrzSim ($38m) loss during the first nine
nwriths. Page 17
JfiVorid Bank’s management attacked:
The World Bank's management came under fire
from members of Its executive board after its
in-house watchdog warned that Its work on pov-
erty reduction was inadequate. Page 7
IFC moves Into Vietnam: The International
Finance Corporation, private sector arm of the
World Bank, announced its first move Into Viet-
nam's nwanriai sector. Page 6
Sabena unions agree cuts: Afresh
financial crisis at Sabena was averted when
trade unions agreed a cost-cutting programme
after Swissair threatened to write off its
SFr280m (f207dun) investment in the Belgian
airline. Page 161 Airline strike likely to embar-
rass Philippines, Page 6
Pharma cia’at second profits wanting:
Swedish-US pharmaceuticals company Pharm-
acia and Upjohn issued its second profits warn-
ing in three weeks. Page 17; Lex, Page 26
Hungarian telecoms group to float:
Matav. Hungary's national telecommunications \
company, is poised to Qoat within the next 18
months. Page 17
Malaysia challenges US threats Malaysia,
whose national oil company laces US sanctions
for Investing In Iran, said that it will use “Inter-
national forums" to challenge Washington’s
■' threat Page 6
India speeds Investment approval:
India's Foreign Investment Promotion Board
cleared 63 foreign investment proposals worth a
total of S694m, sustaining a recent government
drive to accelerate such approvals. Page 5
TV Asahl limns Murdoch’s Influence:
Japan's Asahl National Broadcasting, in which
Rupert Murdoch's News Corporation has a 21.4
per cent stake with Softbank, has acted to curb
tnV: influence of the media group and its Japa-
nese- ■ partner. Page 17
fbrt et watchdogs plan su m mi t: The
worid'Li three biggest commodity futures market
watbhdr S )gs are to discuss concerns about global
. commo^Jity market regulation in the wake of the
SumWomo copper sca nd al. Page 26
Thiil trade gap narrows: Thailand's current
account deficit dipped below Bt30bn (Si.lSbn)
for the first time in six months, the central bank
said, suggesting the country's economic woes
may be easing. Page 6
Swiss arm y secrets missing: The head of
the Swiss army, which has not fought a war in
500 years, is stepping down following accusa-
tions that top-secret battle plans may have
fallen Into the wrong hands. Page 2
PT.com: the FT web site provides online news,
comment and analysis at http://www.FT.com
Malaysian
banks in
complex
talks oyer
moraor
merger,
By James Kynge
in Kuala Lumpur
m stock wuuatT wnwess
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**w H=rt2.<» Kisat Potugrt (niWrt TtMy Liaum
Two Malaysian banks are
negotiating to merge into the
country’s second biggest bank,
responding to a government
drive to prepare local industry
for unrestricted regional com-
petition.
The government has pledged
to open its banking sector to
foreign competition by 2004. It
Is aware that many of the 37
banks which serve Malaysia's
20m people would struggle to
compete with Asia's heavy-
weight banking groups.
The complex negotiations,
confirmed by officials yester-
day. are aimed at merging
Kwong Yik Bank and DCB
Holdings. Another company,
the conglomerate Malaysian
Resources (MRCB), is also
I negotiating to take a stake in
the new bank. The name of the
new bank and the proposed
shareholdings of the respective
parties have not been revealed.
A merger of Kwong Yik and
DCB would create a group
with shareholders' funds of
M$1.89bn <*747tn) and total
assets of about M$45.7bn. This
would rank it behind May-
bank, which has total assets of
M994J2bn, and just above Bank
Bumlputra with assets of
about M*45.6bn.
The new group is likely to
operate a range of banking and
stockbroking services.
Mr Rashid Hussain, the
stockbroker and owner of a
brokerage, is expected to be a
prime mover in the banking
and financial services com-
pany. Mr Rashid, the
son-in-law of Malaysian tycoon
Mr Robert Kuok, has a reputa-
tion for Innovation and profes-
sionalism in stockbroking.
The merger Is expected to
happen in stages. DCB is
expected to acquire the Rashid
Hussain stockbraking house.
In return. Mr Rashid - who
already owns 20 per cent of
DCB - Is expected to receive
new shares. Later, DCB will
acquire Kwong Yik Bank and
MRCB will also take a stake.
Industry analysts said.
Through the MRCB stake,
the government will have a
significant say In the new
bank. In return, the bank is
likely to be regarded favoura-
bly by top officials - a crucial
attribute in a country where
the government often has an
influence over which compa-
nies are awarded a range of
commercial op p n i - t imiwua
“What we are seeing is Mal-
aysia Inc at work," said one
analyst at a local brokerage
house. “Signs of government
guidance are everywhere.”
One sign Is the fact that
i Kwong Yik Is a subsidiary of
Brussels approves
French scheme to
meet Emu target
LDP set to form new government
Japanese prim# minister Ryutatb HashkttOfa, right; tattcat w to Takatco
Del, lander of the Mbring iodai Democnmo party, « member Of th#
previous cpaBtion, whir# stt# Should sign a pofley accord in Tokyo
yester da y, the os re erm ftt, W hi ch also involved the New Hdrfaihger
party, should aBow MT ftoh fc no toV coneervsthm JJberef Democratic
party to fl b vetn as a one-p#rt» ndoortly p o V e risns n t , Wfth Us two fanner
partners offering parliamentary support on the Issues outlined in the
policy accord. Me mb er s of pert Mu ent wM probably elect Mr Hashlmoto
prime mMstor at an e atfau rdfcwuy session tit th# tower house nest
Thursday. Report, Page 18; Editorial Comment, Page.15- .. _ Pfctuw
Britain
set for
showdown
over EU
work rule
By Robert Paston, Vr/
Political Editor
The British government is
preparing for its most dra-
matic showdown to date with
its European Union partners,
over a European Court of Jus-
tin judgment due in ten days
whidh is expected to imple-
ment a maximum 45- hour
wo r k i n g 1 week In the UK.
The government has been
bitterly resisting the imple-
mentation. of the restrictions.
Routs trad in a 1993 directive.
If the judgment goes against
the UK, it will threaten to veto
any- EU re f orms proposed at
the . current European- inter-
government conference unless
the judgment is over tur ned.
"We don't care whether or
not there is a-oew EU treaty
[under negotiation afrthe con-
ference]! So if tl&j’-4qant it.
they are going to have 1
ball on the working time
directive," said a senior politi-
cian.
The cabinet’s combative
stance follows the receipt of
disappointing legal advice on
their ability to delay Imple-
mentation. Ministers bad
hoped that they could buy
time by insisting oh a long
period of consultation before
Implementation,
However they have been
advised that the November 23
deadline for other EU coun-
tries applies to the UK as well.
The government denied it
was once again talking tough,
as in the early stages of the
BSE beef crisis, only to back
off when it came to the
crunch.
"Yon have to understand
that the prime- minister feels
passionately about the social
angle or the EU," said one of
his colleagues.
"Having' secured an opt-out
. from the social chapter, he Is
not going to see all that
thrown away just before the
British election'’.
Hie working time directive
would give employees in many
Industries the right to secure
a maximum 48-hour working
► week. Mr Major felt he had
Continued on Page 16
Pension debt. Page 8
Continued on Page 16
By GUBan Tett In London
and David Owen In Ports
The European Commission
yesterday approved France’s
plan to use FFrB75bn ($7.36bn)
of pension fund transfers from
France Tfclfccom to reduce Its
budget deficit to qualify for a
single currency.
The speed at which the deri-
sion was taken Irritated Ger-
many and Britain. Consulta-
tions with countries like the
UK had not yet been com-
pleted after doubts about the
plan's legitimacy were raised
last week.
Mr Yves Franchet, director
of the Commission's statistical
wing, said France could use
the pension fund transfers to
cut its deficit to 3 per cent of
gross domestic product in 1697.
The move strengthened
belief in the financial markets
that political pressure would
ensure that European Mone-
tary Union takes place. The
priceB of European govern-
ment bonds rose sharply, and
the French franc rose to
FFr3.3755 against the D-Mark,
from a previous close of
FFr3.379.
The Commission’s decision
delighted Mr Jean Arthuls.
French finance minister, who
said it “confirmed his analy-
sis" that the move was permis-
sible.
However. It Irritated some
European countries, including
Germany. Mr Klaus-Dleter
Kuehbacher, a Bundesbank
council member, argued that
the decision was “wrong”.
“It challenges other conn-
tries which seemingly do not
fulfil the criteria to take siml-
French unemployment rose In
September to a record 8.11m
as an opinion poll showed
prime minister Alain Jnppd’s
popularity at a record low.
The Bank of France clipped
five basis points from Its
intervention base rate to 3*20
per cent. Markets felt little
effect. Report. Page 2i Paris
may sell part of GAN, Page 2
lar measures,” he saldj
reflecting concern that coun-
tries such as Italy may now
copy the French move.
Some economists also
warned that the derision could '
exacerbate splits between the
Bundesbank and other Euro-
pean countries about how
strictly the Emu criteria
should be applied.
The European Monetary
Institute is to publish its
report on Emu convergence
next week. Some diplomats
believe this may take , a more
rigorous approach than the
Commission.
Last week a meeting of the
Commission's statistical advi-
sory committee revealed that
German, British and Dutch
officials doubted whether it ;
was legitimate for France to 1
use France TM6com funds in
its budget calculations.
Hie Commission asked each
member state to comment and.
said yesterday that a “large-
majority" of countries
accepted France's move, but
it refused to reveal the size of
this' majority.
The statistical advisory com-
mittee now plans to hold an
emergency meeting to itirtnii-
late its response next Monday.
< ) x r is'-! w [ I ■>! i :- Kti : .
CONTENTS
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2
NEWS: EUROPE
September’s figure climbs as prime minister’s standing falls
French jobless at record leyel
By David OvMn in Paris
French unemployment rose
more than expected In Sep-
tember. It climbed by 27,700
to reach a record high of 12.6
per cent, as an opinion poll
showed the popularity of Mr
Alain Juppe, the prime min-
ister, falling to a record low.
The unemployment rate
repo rted by the labour min-
istry was the same as that
initially recorded for August
but this was subsequently
revised down by 0.1 percent-
age points to 12.5 per cent.
The September figure is
more than a full point higher
than the level a year ago.
Yesterday's figures, which
took the overall number out
of work to 3.11m, came as
the Bank of France shaved
five basis points from its
intervention base rate to 320
per cent The move, which
was smaller than expected,
had little immediate impact
on the markets.
The opposition Socialist
party seized on yesterday’s
jobless statistics, saying the
“inexorable*’ rise in unem-
ployment was a “disastrous
consequence of the restric-
tive economic policy” of Mr
Jupp§’s government.
It said that the most wor-
rying aspect of the figures
was the Increase in unem-
ployment among young peo-
ple under 25 years of age. It
pledged to give this problem
change)
13.0
“an absolute priority".
The party's comments
came as a new survey
showed Mr Juppe’s popular-
ity at its lowest level since
he entered office 17 months
ago..
The Louis Harris poll for
the magazine Valeurs
Actuelles said 24 per cent, or
less than one in four, of 1.000
respondents questioned were
satisfied with the prime min-
ister’s performance, down
from 30 per cent a month
ago. This figure was lower
even, than the 27 per cent
approval rating for Mr Juppe
recorded last December
around the time of thp crip-
pling public-sector strikes
that virtually paralysed the
country.
The government has been
criticised strongly in recent
Passtngar trafflo ' Freight traffic
Employes* Route Passenger/ % change TonrW % change
1994 fOOOkrii) km 1996 over km ISBSover
1994 1996 1985 ' 1995 1 -1985
“ ELI freight transport by road'-
. tboneftm (bnj . ' - ’
' . 1200—- r~— : -V
days for its handling of- the
sale of the Thomson elec-
tronics giant to the Lagar--
dfere defence group. Earlier
this week, it tried to defuse
the situation by promising a
fall parliamentary debate
before a definitive decision
was taken.
The survey also showed a
five-point increase to 70 per
cent in the proportion of
respondents who believed
the economy was deteriarat-
mg.
Adding to the gloomy pic-
ture, the Unedic unemploy-
ment ina^ i r g nfp scheme yes-
terday revised up its jobless
forecasts and. predicted
unemployment would not
finally stabilise ™tn 1998.
El> tratfit te i k pert tjtni.:
toiina/kra^bny.
investors
Germany.lDBJ
Spain (RENFE)
UK (BR)
1894 fOOOkrn)
1984
Jem
1996
185,690
32.3
S52bn
327,a76v\ l -;A*A \
VSOfifcn r-
.= 4 --- - . +
i %
41,137
12.8 "■
1&3bn
118,066
18.6
29.8bn
.197078.80 89 00
. •.t J
93 94 7 1970 75 SO bSiaOIJtS .94
Red signal ahead for EU rail aid
R ailways on the European
continent are caught in a
time-warp. There is no single
market, competition rules do not
apply and rail companies in most EU
countries are heavily subsidised.
While liberalisation has forced
deregulation in energy, telecommu-
nications and some parts of the
transport industry, such as airlines,
most EU rail operators have been
left untouched.
But their cosy position could be
co ming to an end. Plans are being
drawn up in Brussels to strip rail
companies of their right to unlimited
state aid. force the break-up or
monopolies which control infrastruc-
ture and services, and remove barri-
ers to EU-wide rail networks.
Said one EU diplomat: “The choice
is between governments pouring
money into a bottomless pit. or
doing something about loss-making
monopolies. The Commission is
offering member states an alterna-
tive."
Rail operators from the 15 EU
countries have been meeting in
Brussels this week to map out the
first “freight freeways" across the
European Union. The idea, spear-
headed by the Commission, is to
force the pace of change by pressing
ahead with corridors running
through several EU countries to
prove that rail can match the speed
and reliability of road hauliers.
Rail freight services have been in
steady decline for 25 years. Hauliers
have taken to the road as rail freight
speed has dropped to an average
Brussels is intending to shake up the
Continent’s cosseted railway
companies, writes Caroline Southey
speed of 25km per hour. Between
1970 and 1994 rail lost half its market
share as road freight increased by
150 per cent. Although railways car-
ried 25 per cent more passengers,
this figure must be set against a 120
per cent rise in car ownership.
The merit of the freight freeway
initiative is that it requires no legis-
lation or large investment in infra-
structure. As a result, all member
states have volunteered to take part.
One of the first of six routes to be
considered will run from the ports of
Rotterdam. Antwerp and Hamburg
through German; and Austria to
Milan.
The Commission hopes the corri-
dors will set useful precedents by
breaking down national barriers and
sweeping away out-dated practices.
These include different signalling
and safety standards, limited and
nationally dominated access to
tracks, as well as crew and locomo-
tive changes at borders.
However, the enthusiasm for the
freight freeways could easily evapo-
rate once Mr Neil Kinnock, the
transport commissioner, begins an
assault on commercial structures.
A key element of his strategy
includes bringing rules on state aid
for rail in line with those for air-
lines. This would mean only large
restructuring projects and subsidies
for public service networks would be
entitled to assistance. “The nuclear
option would be to apply wholesale
all the rules on state aids. But we
don’t want to do tint Not yet any-
way," a Commission official said.
The intention is also to force rail
companies to put their infrastruc-
ture and oper a tional divisions under
separate and distinct managements.
“There has to be some independence
between those running the services
and those owing the track. Other-
wise new c ome r s have no chance of
breaking into the market." an indus-
try official said.
T he Commission also wants to
tackle the staunchly national
character of EU rail compa-
nies. Mr Kinnock will have to con-
sider whether to apply three-year-old
laws on public procurement which
cover the water, energy, transport
and telecommunications sectors.
These set down the principles of
non-discrimination between suppli-
ers as well as procedures for open
tenders. Competition rules which
forbid discrimination by dominant
suppliers could also be enforced.
The commissioner wants govern-
ments to write off debts accumulated
before 1993. However, as a quid pro
quo, rail companies would have to be
run on a commercial basis. “The
idea is to get away from the debt
culture. This should be attractive to
many member states trying to meet
the criteria for joining a single cur-
rency" the EU diplomat said.
Brussels admits the changes will
cost jobs, but argues that opting for
no change is a recipe for disaster. It
has proposed that EU social fUnds be
used to ease the impact.
Opposition to the plans is wide-
spread. Strongly unionised rail com-
panies such as the Belgian SNCB /
NMBS and the French SNCF are
opposed to radical restructuring.
“There is no need to cut jobs, to
make a revolution. We are compet-
ing against an uncontrolled sector
where the market is totally free and
where users do not pay the proper
price for the service. We do not need
this kind of cowboy competition,"
said Mr Hugnes de Villele, secretary
general of the EU federation of
transport workers' unions.
Mr Kinnock can expect strong
backing from Sweden and Britain,
while countries such as Germany.
Denmark, Italy and the Netherlands
are likely to support moves towards
greater liberalisation. Others, such
as France. Spain. Portugal and Bel-
gium, could well balk at the mare
ra di cal measures.
“There is a lot of opposition to
most of the ideas. As things stand
now there is not much room for opti-
mism,” said an industry analyst.
But, he added: “Don’t write Mr Kin-
nock off He can be very persuasive."
Move to computers defeats Swiss army
By William Hall in Zurich
The head of the Swiss army,
which has not fought a war
in 500 years, is stepping
down following accusations
that some of his top-secret
battle plans may have fallen
into enemy hands.
General Arthur Uener, 60,
who has commanded Swit-
zerland’s 400,000-strong
part-time army for four
years, has announced he
will retire at the end of
1997, a year earlier than
planned.
No reason has been given
for his departure but it is
believed to be linked to the
forthcoming publication of
the findings of an investiga-
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A> The FbudooI Times
V Smjlh ttjrt Bridge. LrtWXI Stl l *nL
tion into recents events at
Switzerland’s ministry of
defence.
The probe followed con-
cern two years ago about
the behaviour of Colonel
Friedrich Nyffenegger. He
had been charged with over-
seeing the army’s first foray
into the computer age - put-
ting all the information
needed by Switzerland’s mil-
itary high command on to
CD-Rom computer discs.
Until then the informa-
tion, which ranged from
troop deployments to battle
plans, had been updated
every year In two large
books which were Issued to
every senior officer.
The CD-Roms were
intended to cut costs and
speed communication.
The project seemed to be
proceeding with typical
Swiss efficiency until Col
Nyffenegger’ s jilted wife
Informed the authorities
that some of her husband's
CD-Roms may have fallen
into the wrong hands. As
any soldier knows, losing
one’s equipment can be a
court-martial affenefc
At last count, Switzerland
bad 148 fighter jets, 730
combat tanks. 300 anti-tank
guns, 1,800 mortars and 400
CD-Roms containing the
secrets of the army’s top
brass.
There were 100 red CD-
Roms with the most secret
information, and another
300 with less sensitive infor-
mation.
When the authorities
swooped on Col Nyffeneg-
, gar's home they found two
of the red CD-Roms along-
side his other CDs in his
music collection. The hap-
less colonel was sent to jail
and the army has still not
been able to account for the
whereabouts of all its CD-
Roms.
The army has played
down the importance of the
loss to the country’s
national security. Battle
plans have been changed
and a new set of CD-Roms
have been Issued.
But the damage to public
confidence has been consid-
erable and conflicts with the
stance of Mr^Adolf Ogi,
army minister. ; who is a
strong advocate of the motto
that there should be “no
shadow of a shadow" in the
affairs of his department . - .
Nevertheless, Gen Iiener’s
derision to take responsibil-
ity for the misdeeds of his
subordinates has led to con-
siderable sympathy.
The Neue Zflrcher Zeitung
newspaper, which has
strong army ties, argued In
an editorial yesterday that if
politicians were to follow
the general's example and
resign whenever there was a
problem It wonld be a “fatal
development”.
By Andrew Jade In Fanis .
The French government 1®'
considering allowing a nimw
ber of private sector inves-
tors to buy some of its
shares in the state-owned
GAN insurance group as
part of a move to recapitalise
and sell it off as soon as next
year.
The Initiative has the.
implicit s u p p or t of the Euro - }
pean Commission, which
mentions the option in its.
official Judgment on a previ- "
ous recapitalisation of GAN
carried out by the govern-
ment last year, a draft of
which has been obtained by
the Financial Times.
The Brussels judgment
also sets conditions which
are likely farther to fuel the
controversy around the sale
of the CIC banking group,
which is controlled indi-
rectly by the state through
GAN, and which is currently
being privatised by a trade
sale.
The document rules that
an' injection into GAN in
1995 of shares the govern-
ment held in both the petro-
leum group Elf Aquitaine
and in CIC should be consid-
ered as a form of state aid
provided to the insurance
group to the value of
FFra^bn ($570m).
However, it concludes that
the aid was justified under
European competition rules
because it met the legal
requirements of a restructur-
ing of a company in diffi-
culty.
GAN last week reported
losses of FFrlbn for the first
half of the year, on top of
heavy losses in 1994 and
1995. These were largely
related to its heavy exposure
to loans in the property sec-
tor incurred by a subsidiary
of CIC which is now man-
aged directly within the
holding company.
The Commission stresses
in its judgment that its
approval of the FFr2.9bn in
French government aid is
conditional an a restructur-
ing of GAN and. among
other factors , an the partial
privatisation of CIC-
It also says it “under-
stands" that the CIC sell-off
needs to respect a
long-st anding partnership in
which CIC sells GAN’S insur-
ance products in the bank's
branches.
However, there is growing
pressure on the Paris gov-
ernment to postpone or
abandon the CIC sale, in
view of fears over both, the
low value of the bids and the
feet that the two potential
purchasers are rival French
banks - Socifete G£n6rale
and Banque Nationale de
Paris - which may pull CIC
apart and jeopardise its links
with GAN.
GAN itself is believed to
be pushing for the sale of
CIC to be postponed until
after its own privatisation
has tak en pla ce, and after It
has received a recapitalisa-
tion of FFr5bn-FFrfjbn. Some
of the latter it believes could
be sought from a core group
of private sector investors
who would take the majority
of the capital It favours a
subsequent sell-off to the
general public of the remain-
ing shares.
The Brussels derision also
criticises the French govern-
ment for the way in which
the recapitalisation of GAN
was carried out. It says it
learnt about the rescue plan
last year only by reading
’ newspaper r e port s, and that
it was forced to make
i repeated requests over many
l months for further infonna-
I tion before being able to ana-
lyse the rescue.
Brussels clears
Telekom offer
The European Commission yesterday cleared a
controversial plan by Germany^ soon to be privatised _
Deutsche Telekom to offer its business clients rebates of
up to 49 per cent hi astatement, Mr Karel Van Miert, the
«nw p <>Htirtw- m nwniMiffnw , . gai d the agreement was
conditional on the conclusion ~6t retroactive network
access agreements between Deutsche Telekom and its
competitors by.December 32, on the German post and
toieo twrimuTHnaHnna ministry taking additional regulatory
steps required for competitive network access in the
domestic market before that date:
The rebate plan had been subject to complaints by
competitors , which, include WorldCom of the US as well
as subsidiaries of Veba, Viag and RWE. They claimed that
Telekom and the ministry had foiled to fulfil the strict
tprmq laid down by the Commission in June for the
rebates to be allowed. AP. Brussels
Telecoms investors may quit Ukraine, Page 3
-Telefonica share warning
The^hare value of Telefonica, the Spanish telecoms
operator due to be fully privatised early next year, could
collapsl*mless the government speeds up liberalisation of
the -sector, Mr J uan vfllalonga, its chairman, said
yesterday. He warned that any delay in opening Spain’s
market by the January 1, 1998. deadline agreed by most
EU countries wouldgprampt the European Comm i ssi o n to
bar Telefonica from piembdtship.of Unisoorce, an alliance
erf smaller European operators.
A Unisource ban would have iw^mmediate effect on
Telefonica’s share price. .“It eoul&fre§§®oce [the price] by
15-20 per cent,” he said. - -. . 7T V : -'
The gmra rairignt plans to sen its resuming 21 per cent
stake in Telefonica early next year toVdisposal that
wonld raise Pte505bn ($8.9bn) at current market prices.
The share price, which, is trading close. record levels,
loetPtaao yesterday to close at Pta2,66oJ A 20 per cent
drop in its share value would knock close- to PtalOObn off
what the government hopes to raise thm nffip the
privatisation. TmnM ir ^- Madrid
Romanians spoilt for choice in polls
Virginia Marsh watches the final TV debate between 16 presidential hopefuls
President Ion Iliescn:
seeking third term
Romania wrapped up a
bitter two-month election
campaign last night with a
tense marathon television,
debate between the 16 candi-
dates in Sunday’s presiden-
tial elections.
Voters, who will also elect
a new parliament, faced a
dazzling choice. As well as
Mr Ion Hiescu, the incum-
bent, the debate included a
faith-healer, a fiery national-
ist who was one of the late
Nicolae Ceaufescu’s favour-
ite poets, the car owners’
party candidate, an ethnic
Hungarian lawyer, a retired
general and a heart surgeon
called loan Pop de Popa.
The debate, broadcast live
from the deposed dictator's
vast Palace of the People,
also saw a rare meeting
between Mr Iliescu, who is
standing for a third term,
and Mr Petre Roman,
Romania's reformist first
postrCommunist prime min-
ister. The two men worked
together closely in the after-
math of Ceau^escu’s violent
overthrow but have been the
bitterest of enemies since Mr
Roman's government was
toppled by rampaging min-
ers In 1991.
Despite the many candi-
dates, however, opinion polls
suggest about three-quarters
or voters will opt far repre-
sentatives of the three main
groups in both contests - a
sign that the fledgling
democracy’s fractured politi-
cal scene Is maturing.
While Mr Hiescu is ahead
in the presidential polls, his
Party of Social Democracy
(PDSR), a leftwing group
dominated by former Com-
munists, is t railing thp oppo-
sition Democratic Conven-
tion, a centre-right coalition,
in the parliamentary race.
Mr Roman’s technocratic
Social Democratic Union is
in third place in both con-
tests but hopes to join a Con-
vention-led government
Several small parliamen-
tary parties, including the
extreme nationalists and
neoGommunista which have
supported the PDSR's four-
year minority government,
are hovering around the $
per cent threshold needed to
enter the new legislature.
- In Last night’s debate can-
didates were limited to
answering questions and dis-
cussing policy, in contrast to
a campaign marked by
insult-swapping, alleged
dirty tricks and controver sy -
over organisation of the elec-
tions.
In aggressive video-clips,
Mr Qiescu’s campaign has .
accused Mr Emil Constanti-
nescu, the Convention's can-
didate, of bring a closet mom
artirist intent on returning ’
farmland to large landown-
ers. Mr Roman, 'who is half- .
Jewish, has faced anti-Se-
mitic attacks while Mr'
Ihescw h aR been heckled- and j
booed by factory” ■' workers *
who were once .solidly
behind him.
Mr Hiescu is expected to
face Mr Cpnstantinescvv an
academic, whom he defeated
easily in the last elections
four years ago, in what is
likely to be a tightly con-
tested run-off for the presi-
dency on November 17.
Italian growth forecast ciat
The Bank of Italy yesterday offered a far more cautious
estimate of economic growth next year than the 2 pfif cent
projected by the centre-left government Its bi-annual\
economic bulletin says the sheer size of the budgetary 1
measures due to be introduced next year are bound to \
have a negative impact on growth. It expects gross \
domestic product to be “about half that predicted by the %
government.
Tim bank confirms the view of most economists that
depressed consumption and slack domestic demand,
against a background of weaker export markets, will
restrict this year's growth to under 1 per cent.
Hie two-stage 1997 budget, due to be voted on in the
chamber ed deputies thta month, afrn«; to find L62£00bn
($41bn) in spending cuts and fre sh taxes. This is
equivalent to removing 3 per cent of gross domestic
product from the economy. The bank further paints out
that additional corrective measures will be required in
1998 to the tune of L27,000bn.
Far the first tune in many years, the bank is more
sanguine about inflationary trends. It says inflation next
year should be below 3 per cent, although wage demands
would need to be moderated. Robert Graham. Rome
Stet chief ‘investigated’
The head of Italy's state telecommunications holding.
Stet, and the third highest official in the tax police were
yesterday placed under investigation in a corruption
probe, state television reported, quoting judicial sources.
It said magistrates in the north-western town of Aosta
alleged that Stet managing director Mr Ernesto Pascale
was Involved with a secret group set up to try to influence
public and government a ppo in t m ents.
Tax police chief of staff Nicolo Pollan was repor t ed to
be mider investigation as an accessory. The deputy head
of the tax police, Michele Mola, was recently placed under
investigation for the same offence, Italian media reported.
Magistrates allege that both tax police officials tipped off
a member of the separatist Northern League party that
his telephone was bugged.
Mr Pascale issued a statement saying; “I can’t even
imagine what hypothesis this Investigation is based on.
There’s never been anything secret tn my life and I am
sure that this can be demonstrated as quickly as
possible.” Mr PoHari called the investigation
“bewildering”. Reuter. Rome
French film director dies
Marcel Came, director of the French Him classic Les
Enfimts du Paradis . died yesterday aged 90. Camd
pioneered the French “film noir", winning widespread
acclaim in the 1930s and 1940s. and worked consistently
for three decades after the second world war. He won)
' widespread acclaim for Q uai des Brumes and Hotel du
Nord in the 1930s and 1940s, but will probably be
remembered best for Les Enfants du Paradis, starring *
Arletty, Pierre Brasseur and Jean-Louis Barrault, which
. dvb&ed the street IHeDf Paris in the mid-19th century.
. He was hit by the end of his partnership with
sc ript w ri ter and poet Jacques Prevert in 1947. and then by
the arrival of the French “new wave” in the late 1950s
which rejected his classical style of film-making. His
post-war career was plagued by critical and commercial
setbacks. “The last couple of films I made were not a
success. I didn't want to become academic and dry," he
said. - Reuter. Paris
ECONOMIC WATCH
EU inflation at low level
European Union inflation
! in September remained at
• r i ■ -v' • . . : . v the record low level it
-fe ~ a ' v '~ reached in August, rising
at an annualised rate of 2.3
' : / x . per cent, Eurostat reported.
- V | r - V In September last year
, ’-rt Inflation stood at per
r ^ cent Nine of the 15 EU
j countries registered rates
; ■'! V.; at or below 2 per cent, with
Sweden performing best at
. ■ .- -■ 'Vi virV-V- 0.2 per cent and Greece
.?** ~ r . ~ - T — worst. with inflation of &5
percent. Reuter, Brussels
i ftj -;.-.- - -- -t •' :i; r ; ■ Greece's first-half
: ; Iso current account deficit
Vnrrrv nafMtitlii '' ' U - jumped by 47.3 per cent to
...” 7 ‘ $£l5bnu according to the
- Bank of Greece. Although thehalahc* of payments gap
widened l^oifiy 3^ per ram to $g«fIm T -recript8 from .
invisibles showed a sharp decline. Imports increased by
2Aper teat; to $iL8bn, while exports were flat at £L8bn-
The surplus on invisibles fell by 10.6 per cent to $5.7bn.
Income from tourism was down 14B per cent to $l.4bn,
while transfers from the European Union dropped by 8^3
per cent to'KL2bn because of the slow rate of
disbursement of grants for Infrastructure improvements.
Kerin Hope. Athens
■ Finland '8- gross domestic product rose 2.1 per cent
year-on-year in August.
■ Unemployment in Norway fell to a seasonally adjusted
3-6 per cent in October from 3.9 per cent in September.
i
THE Vf-.
- - ;r»RDAN
financial times
FRIDAY NOVEMBER 1 1996
NEWS: EUROPE
Telecoms investments in
Ukraine under threat
By Matthew Kaminski
in Kiev
Two of tbe largest foreign
investments in Ukraine are
in jeopardy after the govern-
ment last month raised tar-
iffs and changed licensing
requirements for cellular
telephone operators.
The changes have ham-
strung plans by a joint-
venture company called
Ukrainian Mobile Communi-
cations (UMC) - formed in
1992 by Ukrainian Telecom,
Deutsche Telekom. PTT
Netherlands and TeleDan-
mark - and separately Moto-
rola of the US to operate
GSM cellular services in
Ukraine.
The dispute highlights the
difficulties faced by foreign
companies in Ukraine, which
has attracted barely $lbn in
investment since 1991, one of
the lowest per capita figures
tn the region.
UMC shareholders, at a
meeting on Tuesday in .
Copenhagen, warned the
company would rethink its
$300m commitment planned
over the next three years
unless the Ukraine govern-
ment honours what it claims
is a binding promise made in
a 1992 licence to award it a
GSM frequency. .
The Ukrainian cabinet moved yesterday .to open up the
lucrative gas distribution business next year under
pressure from President Leonid Kuchma, writes Matthew
KamlngVj
Mr Knnhmn implicitly criticised tbe current scheme,
which gives two influential companies. United Energy
Systems CUES) and Item, a virtual duopoly, by telling
Xnierfax-Ukrame news agency on Wednesday that the
distribution market should become competitive.
The U krainian leader .made the statement after a
meeting with Hr Rem Vyakharev T the head of Gazprom, tbe
Russian gas monopoly. It appears directed at Mr Pavlo
Lazarenko, the prime minister. His position i«« been
undermined by allegations that he personally benefits
from his involvement with UES amj other business
interests.
Tbe charges coincide with the growing ifr fi nery of
officials from Dniprupetrovsk, a large industrial city in
eastern Ukraine, within the government since Mr
Lazarenko took over in May. Both tbe prime minister and
Mr Kuchma are from Dnepropetrovsk.
With an an n ual turnover of $5bn, UES this year won a
government mandate to handle ssibn cubic metres of
natural gas, nearly half the 58.13bn cubic metres imported
each year. Itesra supplies 18.4 6bn cubic metres.
- Motorola, which got its
GSM licence through a joint-
venture with Ukrainian
Radio Systems (URS) that
was formed last year, has
plans to invest $50Qm over
the next 15 years.
UMC officials are alleging
the Kiev government
changed the rules in order to
push out western competi-
tors from the growing
mobile telephone business.
Neither UMC nor URC
were allocated GSM frequen-
cies on time in September.
Instead, thw Ukrainian cab-
inet said all mobile tele-
phone operators must renew
their licences before the new
year and set tariffs for radio-
frequency use several times
above regional standard.
Mr Martin Dirks, general
director of UMC, said the
company had already made
a $9Qm investment - $l 2 m
alone to test out GSM tech-
nology - in a risky country
on the assumption that the
GSM frequency would be
allocated and reasonable
rates set. UMC had a local
monopoly until last year. T
hope tbe Ukrainian govern-
ment understands that when
investors lose trust in a
country It will have serious
repercussions on its image
abroad," he said.
Ukrainian offiHaig counter
that the government has no
contractual obligation and
can enact new licensing pro-
cedures.
“We don’t have a govern-
ment guarantee signed by
President Leonid) Kuchma,”
said Mr Gregory Perchatsch.
Motorola's country manager.
“But we have promises that
they would be allocated fre-
quencies.”
Two other companies, BK
Telekom of Yugoslavia and
Kiev Star, a Ukrainian com-
pany, last week were
awarded GSM licences. Tbe
frequencies may now be
awarded by another means,
such as a tender.
UMC officials said nifg fur-
ther un d e rmin ed tin* initial
agreements. "There’s only
room for two” GSM opera-
tors. said Mr Perchatsch.
Famous Paris cultural attraction to close for 2 years
Centre a
victim of
its own
success
By Andrew Jack in Paris
Just 20 years after It was
opened, one of Paris' best
known cultural attractions
is to largely close down or
transfer most of its activities
to allow for wide-ranging
renovations due to last for
two years.
The Georges Pompidou
centre, at the heart of the
French capital and one of
the most visited tourist sites
In Europe, is to launch an
ambitious reconstruction
programme set to cost
FFr440m ($86m).
The changes should offer
relief to visitors to tbe cen-
tre who in recent years have
faced the prospect of fre-
quent break-downs in its
moving escalators, and the
sight of peeling paint and
widespread rust on its
famous multi-coloured exter-
nal pipework.
They come at a time when
a number of Paris* leading
public monuments con-
structed in the last few years
are running into difficulties,
including the new Bastille
The Pompidou Centre, 20 years old and receiving a facelift
opera house and tbe Grande
Arche at La Defense to the
west of Paris, both of which
are suffering from cracking
marble on their & cades.
The repairs stand in stark
contrast to the apparent
durability of many of the
city's longer established
buildings, such as the Com6-
die Franpaise, which has
lasted more than 200 years
without more than modest
periodic facelifts.
However, officials unveil-
ing the Pompidou’s plans in
Paris yesterday were at
pains to stress that the modi-
fications to the centre were
in no way a criticism of the
original design, and that
structurally the building was
entirely solid. Their aim was
to increase the internal
space available.
Mr Guillaume Cerutti.
director general of the cen-
tre, said: “In many ways, the
building Is a victim of its
own success.” He pointed
out that in place of the origi-
nal estimates of 5,000 visi-
tors a day, there were up to
25,000. with an average of 8m
a year or 160 m since it
opened in 1977.
He also stressed that dur-
ing the renovations - the
pace of which has been
accelerated - one large exhi-
bition space, as well as the
external stairway offering
panoramic views across
Paris, will remain open, with
the library moving nearby.
The plan is to ensure that
the centre will re-open ahead
of the millennium, when the
huge digital clock counting
down the seconds to the year
2000 which stands at its
entrance will have theoreti-
cally reached zero on Its
counter.
Spanish television market engages in bitter political battle
GlobaJ television groups
seeking to secure alliances
in the Spanish market are
being presented with a frac-
tured industry that pits big
domestic players against
each other in a poisoned
political atmosphere.
At stake is the launch
early next year of digital sat-
ellite services with local and
Latin American partners
which are estimated to gen-
erate a free . cash flow of
Pta36.6bn ($285m) In Spain
and earnings of Pta2i.4bn on
sales of PtaloSbn at the end
of 10 years.
These projections are
based on the formation of
one digital infrastructure
serving close to 3m domestic
Tom Burns on why potential global partners are closely following developments
subscribers. The income esti-
mates are much higher for
broadcasters and program-
ming providers if the ser-
vices embrace the Spanish-
speaking world.
The problem is that two
digital platforms are being
planned. Aside from damp-
ening profit forecasts, the
rivalry has confused pro-
spective partners. There is
no feasible working arrange-
ment at present so we are
talking to everyone," said an
executive of one US pro-
gramming company.
The list of potential for-
eign. players who are closely
following Spanish develop-
ments is a long one. It
includes US companies
DirecTV, the digital broad-
caster which is part of the
Hughes Electronic Corpora-
tion, Time Warner, and
Venezuela's Cisneros group,
which is one of the world's
largest producers and dis-
tributors of Spanish-lan-
guage programmes, Mexico's
Televisa network, tbe UK
satellite company British
Sky Broadcasting that is 40
per cent-owned by Mr
Rupert Murdoch’s News Cor-
poration and Germany’s Leo
Kirch group.
One platform, due to start
services in January, is being
promoted by Sogecable, the
broadcaster controlled by
Grupo Prisa, the main
domestic media company
and the publisher of the
vnflw«»nti»i topselling news-
paper El Pals. A second,
which plans to begin operat-
ing in March, is being led by
Telefdnica, the national tele-
coms company that is 21 per
cent state-owned and due to
be privatised next year.
TelefSnica announced yes-
terday that it had contracted
relays with Hispasat, the
Spanish satellite that it part
owns together with other
state-controlled companies,
in order set up its digital
Infrastructure. “This is a
strategic project for us,” said
Telefonica chairman Mr
Juan VUlalonga.
Two weeks ago Sogecable
signed a relay deal with
Astra, the French satellite
system, and said its decod-
ing equipment would be sup-
plied by France's Canal Plus
which is one of the Spanish
broadcaster’s biggest share-
holders. In a dear bid to lead
Spain's move into a new tele-
vision business, Sogecable
said it would make an initial
investment of PtaSObn.
DirecTV, one of Sogeca-
ble’s initial backers, was
understood yesterday to be
reassessing its affiance with
Grupo Prisa in the light of
Telef6nica’s aggressive bid
to enter the sector. “We are
conducting feasibility
studies with Sogecable but
there is no firm agreement,”
the California-based broad-
caster said.
Ironically Telefonica and
Grupo Prisa, which pio-
neered pay TV in Spain
seven years ago with Canal
Plus Espafia, a network that
has now some L5m subscrib-
ers, had signalled a
far-reaching agreement early
this year to jointly develop
cable television. However,
this arrangement fen foul of
general elections in March
that brought the centre-right
Popular party to power
replacing the Socialist party.
The political change ended
what critics of Grupo Prisa
claimed was tbe advanta-
geous position enjoyed by
left-le aning media group dur-
ing the years of Socialist
rule. When Mr Villa] onga, a
former investment banker
and a school friend of prime
minister Mr Josh Marla
Amur , was appointed by the
new government to run the
telecoms company, he aban-
doned the cable project and
repositioned Telefonica into
a Grupo Prisa rival for the
di gi tal business.
Mr Villalonga's supporters
say the venture is an intelli-
gent defensive move against
foreign telecoms groups
seeking a backdoor entry
into Spain via Sogecable.
But critics say he is spear-
heading a government cru-
sade to keep the hostile
Grupo Prisa out of the indus-
try. They believe this overtly
political battle will reduce
the operator’s investor
appeal as it approaches full
privatisation.
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FINANCIAL TIMES FRIDAY NOVEMBER 1 1996
Helms dies hard
in North Carolina
Ageing political streetflghter looks odds
on to win a fifth term in the US Senate
NEWS: AMERICAS
A last-minute advance appears to be bad news for Dole
Nowhere man
Perot shows
a late surge
Lacklustre Perot doubles support of two weeks ago
By Jurek Martin in Boston
Late in the
day. Mr
Ross Perot,
candidate of
his own
Reform
Party, may
finally be
making
some waves
in this
year's presi-
dential elec-
tion, to be
decided on
Tuesday.
He has begun to nudge
into double digits in some
national public opinion
polls, apparently benefiting
more than Mr Bob Dole, the
Republican candidate, from
the scathing attacks both
have launched against Presi-
dent Bill Clinton's ethical
standards.
He has even challenged
the president to an election
eve debate on the acceptance
by Mr Clinton and his Demo-
cratic Party of contributions
from foreign sources.
By Christopher Parkes
in Los Angeles
The White House politely
declined the overture on the
grounds that the president
was otherwise engaged.
Mr Perot also inserted
himself into the widely
watched Senate race in Mas-
sachusetts by coming to Bos-
ton to endorse Republican
Governor Bill Weld, who is
locked in the tightest of con-
tests with Mr John Kerry,
the incumbent Democrat.
His mini-surge in the polls
to double the support of two
weeks ago still brings Mr
Perot to barely half the 19
per cent of the popular vote
he took as an independent
candidate four years ago.
But final pre-election poll-
ing then, giving him 12-14
per cent, underestimated his
eventual appeal.
His advance appears bad
news for Mr Dole, whose
mantra long has been that a
vote for Mr Perot is. in
effect, a vote for Mr Clinton,
especially in those states
where the two main contend-
ers are close. Last week Mr
Dale even unsuccessfully
invited Mr Perot to with-
draw from the race but got
the back of the Texas billion-
aire's hand in response.
In Massachusetts Mr Weld
had appeared to have drawn
level with Mr Kerry prior to
their eighth and final debate
in Boston on Monday night.
But a combination of the
senator's arguments directed
at women voters and the
governor's relentless assault
on his opponent's ethics
seems to have helped Mr
Kerry, who had re-opened a
6-point lead in a small sam-
ple Boston Globe poll.
Mr Perot's endorsement of
Mr Weld was delivered in
typical fashion. Giving a
speech, he kept the governor
waiting off stage for
a good hour while he
laid into the “huge
moral, ethical and criminal
problems” facing Mr Clinton
and the "rotten corrupt prac-
tices” in the money-raising
techniques used by both par-
ties.
But he finally described
the governor as a “doer”
who “got rid of the red ink"
in Massachusetts, which
nobody in Washington, he
said, knew how to do.
By Jurek Marten in
Greensboro, North Carolina
H e is 75 now and
looks it. A heart
condition has
slowed him down, a bone
disease has turned his long
stride into a shuffle, he
wears hearing aides in both
ears and his complexion,
once ruddy, appears waxen.
But it would be premature
to assume that political
mortality is necessarily
catching up with Mr Jesse
Helms, much as his legion of
foes might wish it. They
include American liberals,
US trading partners, any
developing foreign country,
especially those with
regimes even slightly to the
left of centre and. to the last
bureaucrat, the state
department in Washington.
They do not, however,
constitute the electorate of
North Carolina. Some doubts
may remain but the odds are
that on Tuesday he will be
returned for a fifth term in
the US Senate where he will
again act as scourge of the
left at home and overseas,
enemy of foreign aid and
sponsor of controversial
legislation. like the
Helms-Burton act punishing
foreign companies for
trading with Cuba.
It is always instructive for
students of politics to
observe a Helms election.
This time, as in 1990, he is
opposed by Mr Harvey
Gantt, former mayor of
Charlotte, a successful
architect, an energetic and
fluent campaigner - and
black.
His approach had been a
little different from six years
ago, when Mr Gantt led
early before being swamped
by a tidal wave of negative
advertisements, many
r unning close to the line of
overt appeals to racial
prejudice. Mr Helms won by
53-47 per cent, about the
average for his victory
margins from 1972 onwards.
His new campaign team,
according to Mr Dan Gurley,
political director of the state
Republican Party, sought to
portray a “kinder, gentler
Jesse," right down to
pictures with his
grandchildren and much
emphasis on the
"statesman's" role he had
assumed in Washington as
chairman of the foreign
relations committee. His
own appearances were kept
to a minimum and his
speeches short
But even with a lead
bordering on 10 points, the
old Helms dies hard. Over
the last week a new round of
TV commercials has hit the
air waves, accusing Mr
Gantt of firing advantage of
“minority privileges" to win
state contracts for his
architectural business-
“He’s more subtle tha n he
used to be." observed Mr
Ned C-line. the veteran
political commentator on the
Greensboro News and
Observer. “Thirty years ago.
he would not have hesitated
to use the n-word."
Mr Gantt, in good form at
a rally outside High Point
this week, insists Mr Helms
is going “negative" in order
to avoid discussion of the
real issues. Even Mr Gurley
concedes “some debate” in
Republican circles over the
Helms: age and disease have
not seen him off
wisdom of a change in tack
that has gone down poorly
elsewhere in the country.
But Mr Helms always
plays hard ball in elections.
Alone of statewide
candidates, he has refused to
participate in an innovative,
but controversial,
experiment in issue-oriented
“civic journalism"
undertaken this year by
several North Carolina
newspapers.
They took an extensive
state opinion poll to identify
voter concerns and sought to
follow through by tilting
their coverage, often pooled,
to those deemed most
important. Candidates were
asked to submit to two long
interviews on the issues, one
early in the year, the second
at the start of the campaign
proper.
Mr Gantt agreed, if
reluctantly, but not Mr
Helms, never a friend of the
press. At his only public
appearance on Tuesday, on
the edge of a vast Wal-mart
parking lot in Sanford, he
was briefly besieged by
reporters. “Why not sit down
with us for just 20 minutes?"
one local begged. “Why?" he
replied and stepped Into his
bus. Naturally he has also
refused to debate Mr Gantt.
It is a tactic that works in
North Carolina, where the
“liberal media," state and
national, is held in unusual
contempt. That sense, deftly
stoked by Mr Helms, has
been heightened by what the
state generally considers an
unconscionable attack by
the Clinton administration
and its press “allies" on its
second largest industry -
tobacco.
No North Carolina
politician interested in
w inning takes on tobacco
with impunity - and Mr
Helms is Its staunchest
supporter. Even popular
Democratic Governor Jim
Hunt, assured of re-election
on Tuesday, talks of 260.000
jobs in tobacco and has filed
suit against the
administration’s proposal to
place the industry under the
jurisdiction of the Federal
Drug Administration.
It also helps Mr Heims
that the population influx
into his booming state -
700,000 since 1990 - has
turned out to be more
Republican than Democrat.
Mr Gurley claims his party
has gained 140,000 new
registered voters in the last
four years, while the
Democrats have lost 70.000.
In 1994 that helped the
state elect eight Republican
congressmen and four
Democrats, the reverse of
the previous representation,
and gave Republicans
control of the lower house of
the local assembly for the
first time.
Some of the newcomers,
especially from the north,
may find their new senator
an unfamiliar breed of
politician, almost an
anachronism in matters of
race, but that has been local
sentiment for years. The
North Carolina truism is
that 40 per cent will back Mr
Helms always and 40 per
cent never, leaving elections
decided by the remainder.
So age and infirmity do
not appear to work against
Mr Helms. And after all,
across the bonier in South
Carolina, Senator Strom
Thurmond, 93. is tottering
happily towards an eighth
term.
California Latinos find their voice
C alifornia's quiet minority -
the Latinos who make up a
quarter of the state's popula-
tion - have found their voice. It will
be heard in an unprecedented chorus
in next week's presidential, congres-
sional and state legislature elections.
A record 1.4m are expected to vote.
25 per cent more than in the 1992
poll which brought President Bill
Clinton to power. All but 20 per cent
of them favour the Democrats,
according to the Tomas Rivera Pol-
icy Institute, a regional think tank.
Their votes are probably not criti-
cal in tiie main race, where latest
samplings show Mr Clinton still
handsomely ahead of Mr Bob Dole,
but their 10 per cent share of total
votes in the state represents a valu-
able resource for Democrats hoping
to regain control or Congress.
It is an even more powerful lever
in Mr Clinton's party's efforts to
regain control of the evenly divided
state assembly, where the Republi-
cans control the balance of power
through their occupation of the
speaker's chair.
In the longer term. Latino advo-
cates suggest. California’s November
5 voting patterns may clarify trends
of national significance in a country
which in 10 years will see citizens
with Latin American origins or
ancestry displace African-Americans
as the country's largest minority.
According to Mr Fernando Guerra,
an academic analyst from Loyola
Marymount University'. Latino sup-
port Is now more clearly in the Dem-
ocrat camp than at any time since
1976 when the group's voting pat-
terns were first monitored. He calcu-
lates at least 40 city councils in the
state are mostly Latino.
For years, with exceptions such as
the stoutly Republican Cuban group.
California's Latino vote has showed
few distinct political tendencies
despite the innate conservatism of a
religious, hard-working and socially
introspective community.
In the past, the turnout has tended
to under-represent the group. But
now, grassroots issues and candi-
dates have emerged which may
serve to galvanise this reticent slice
of the electorate.
Democrats have done relatively lit-
tle actively to court support. Rather
they have found votes driven in
their direction by leading Republi-
cans. including Mr Pete Wilson, the
state governor, and Mr Bob Dole, the
Republican presidential challenger,
who have strongly supported initia-
tives on issues widely perceived as
anti-immi gran L
These include opposition to bilin-
gual education, a looming state ref-
erendum on a proposal to end affir-
mative action to benefit minority
students and workers, and existing
measures to exclude illegal immi-
grants from public education and
health services.
Mr Jesus Silva Herzog, the Mexi-
can ambassador in Washington, ech-
oed widespread resentment when he
said the presidential campaign had
generated an “anti-immigrant atmo-
sphere, with a certain flavour of
being anti-Mexican."
Another proposal on next week's
Californian ballot sheet, to raise the
state's minimum wage, is also
expected to bring out a higher pro-
portion than usual of Latinos.
In one rural area, widely touted as
the make-or-break seat for Republi-
can control in the Sacramento
assembly, Latina Democrat Ms Lily
Cervantes faces the Republican
incumbent, Mr Peter Frusetta. Ms
Cervantes lost the race last time by
700 votes, since when 5,000 Latinos
have registered as Democrats.
But most eyes are on an appar-
ently uneven struggle developing in
the 46th Congressional district
where half the population is Latino.
Here, in deeply conservative
Orange County, another Latina
Democrat candidate with no political
experience faces a right-wing tough-
guy who set the tone by accusing his
opponent of attending a gay-spon-
sored fundraiser organised by “sod-
omites.” Ms Loretta Sanchez, a
Republican until 1992. has been lav-
ished with financial support from
gay groups, environmentalists, pro-
choice advocates and supporters of
every cause Mr Robert Daman, the
resilient Republican incumbent, so
robustly denounces in Washington.
Polls say the race is too close to
calL This suggests Ms Sanchez has
quickly found substantial support
among moderate Republicans, but
the decisive portion of the vote could
well rest in the bands of Latinos.
A record 1 .4m Latinos are expected to
vote and 80% favour Democrats
Brazil crash stirs safety fears
A Brazilian jetliner crashed
into a residential area of Sao
Paulo yesterday, killing all
95 people aboard and raising
new questions over the
safety of air travel in the
region, writes Jonathan
Wheatley in S&o Paulo.
The death toll was expec-
ted to rise as firefighters
searched homes struck and
sot on fire by the crash.
The Fokker F-100 airliner,
operated by TAM. a domes-
tic airline which recently
expanded into international
services, crashed shortly
alter taking off for Rio de
Janeiro.
Witnesses said the jet clip-
ped two small apartment
buildings before crashing in
names into 10-15 houses.
Buildings and cars were set
on fire by burning fuel
escaping from the aircraft
idler Its first impact. Many
residents had already left
home for the day.
Mr John MacDonald of
Aviation Management Ser-
vices in Miami said the
increase in accidents in
South America in the past
two years reflected the
growth in air travel in the
region.
“With the number of
flights increasing as it is, the
rate of accidents is bound to
go up." he said, adding that
TAM was a modem airline
with a good safety record.
Officials said the cause of
the crash would not be
known before the aircraft's
two night recorders had
been examined.
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Hard-pressed Mexico delays the
start-up of private pension funds
By Leslie Crawford
in Mexico City
The start-up of private
pension funds In Mexico has
been delayed for six months.
The move, coupled with
backtracking over the priva-
tisation of the petrochemical
industry, has raised con-
cerns about the govern-
ment's ability* to deliver fun-
damental economic reforms.
Private pension fund
companies, known as Afores
in Mexico, were due to open
shop in January 1997.
However, the government
obtained congressional
approval this week to delay
their launch until next July.
The official explanation
for the postponement was
that time was needed to
design a new identification
code for pension accounts,
despite the fact that all
working Mexicans already
possess a social security
number.
Some economists said the
delay would save the
government a lot of money
In 1997, a year in which
Mexico will still be
recovering from the deep
recession of 1995. Mr
Guillermo Ortiz, finance
The Mexican currency
showed signs yesterday of
stabilising at around 8 pesos
to the dollar, following a
month-long slide In which
the currency has depreci-
ated by 6 per cent, Leslie
Crawford reports from
Mexico City.
On Wednesday, the spot
rate for the peso closed at a
historic low of 7.995 to the
dollar. It weakened further
on Thursday, opening trade
at 8.0525 before rallying to
close at 7.97 against the dol-
lar.
Mexico's central h ank has
sought to stabilise the cur-
rency by increasing
minister, has es tima ted the
annual cost of Mexico’s
social security reforms at
around 1 per cent of gross
domestic product, or about
$2-5bn.
This is- because the
government will have to
continue paying for the
pensions of lm retired
Mexicans after workers
switch their contributions
from the state-run system to
individual retirement
accounts managed by
private-sector fund
short-term interest rates,
but the peso has not
responded to a rise in the
benchmark rate for 28-day
treasury bills to almost 30
per cent from 23 per cent in
early October. The peso's
volatility has also scared off
foreign portfolio investors:
Mexico City’s stock
exchange index has fallen
by 8 per cent in nominal
terms since the high point of
the year on August 27.
The peso's depreciation
has not been accompanied
by the panic which affected
Mexico’s financial markets
last year, as most econo-
mists believe the currency’s
administrators. Last week.
Mr Ortiz said the cost of the
reforms would open a budget
deficit of 0.5 per cent of GDP
in 1997.
The postponement of
pension reforms will delay
President Ernesto Zedillo's
goal of raising Mexico's
dismal domestic saving rate,
which has made the country
too dependent on foreign
capital flows to finance
economic growth.
Mexico's domestic savings
rate fell to below 16 per cent
slide is temporary.
Mr Paulo Leme, a senior
economist at Goldman
Sach’s in New York, believes
the peso remains underval-
ued by about 13 per cent
against the dollar. “The dis-
turbances which have
affected the peso are tempo-
rary." Mr Leme said. “The
peso should continue to
appreciate over the next 12
months."
Mexico's tight monetary
policy, hi gher-th an -expected
oil revenues, and the grad-
ual accumulation of interna-
tional reserves were factors
that ought to strengthen the
currency. Mr Leme said.
of GDP in 1995, a level
considered too low to
spearhead significant
growth.
Chile, which privatised its
pension system 15 years ago,
boasts an internal savings
rate of 27 per cent of GDP as
well as one of the highest
growth rates in Latin
America.
The decision to postpone
the launch of private
pension funds has annoyed
several financial groups
which were looking forward
to signing up customers in
January.
Mr Juan Fernandez Casas,
director of an Afore
joint-venture between Serfin,
Mexico’s thtrd-largest bank.
Citibank and the Chilean
pension fund administrator
Habitat, said yesterday: “The
delay is not welcome from a
business point of view; it
will be an additional cost to
our Investment outlays."
Mr Fernimdez Casas said
Serfin and its partners
planned to spend an initial
$70m to set up the pension
fund management business,
including the cost of hiring
some 6,000 sales agents.
Other financial groups
have announced similar
outlays. Banamex and
Ban comer - Mexico's two
largest banks, have lined up
foreign insurance companies
Aegon and Aetna as partners
in the pension fund
business.
Banco Santander and
Banco Bilbao Vizcaya of
Spain have also expressed an
interest in offering pension
schemes in Mexico - a
business which analysts
estimate could be generating
more than $l7bn In savings
by the turn of the century-
Alfonsin begins come-back bid
By David Pilling
in Buenos Aires
Argentina's former president
Mr Raul Alfonsin launched
his push to be a candidate in
the 1999 presidential elec-
tions during a rally at which
he accused the Peronist gov-
ernment of “transforming
Argentina into a colony" and
promoting a savage free- mar-
ket system of "every man for
himself'.
Mr Alfonsin, 69, on
Wednesday night proved
that rumours of his political
demise were exaggerated by
drawing a crowd of 30,000
supporters to a Buenos Aires
football stadium. Adopting
his famed rhetorical style, be
said Argentina’s economic
policy was being decided in
Washington, and that the
government's adoption of
unfettered neo-liberalism
was destroying jobs
and regional economies.
Ostensibly to mark the
anniversary of his 1983 elec-
toral victory, which returned
Argentina to democracy
after seven years of dictator-
ship. the rally was aimed at
resurrecting the former pres-
ident's political fortunes. Mr
Alfonsin was last year
replaced as leader of the
Radical party by Mr RodoUb
Terragno alter a disastrous
1995 presidential campaign.
The Industrial Credit and Investment
Corporation of India Limited
Zwlth House. Keshavraa Khade Mars. Mahatexml, Mumbai 400 034, tndta.
EXTENSION OF LAST DATE OF OFFER FOR
sale/takeover/merger of a company engaged in
MANUFACTURE OF WHITE CEMENT AT RAJASTHAN VIDE
AN ADVERTISEM ENT RE LEASED IN THIS PAPER ON
SEPTEMBER 3, 1996
The last date for submission ol bids for sale/takeover/
merger of ihe above-mentioned company is hereby being
extended from October 31. 199B to November 30. 1 996.
By Nancy Dunne . . .
in Washington
The International Finance
Corporation, the private sec*
tor arm of the World R*mic
this week announced its first
foray in Vietnam’s ffnan/Ho]
sector - the establishment of
a leasing company to enable
small and medium-sized
companies to procure capital
goods.
On the surface the $i5m
loan and *750,000 equity
investment looks modest.
However, the corporation
has. been promoting leasing
as one of the quickest,
cheapest and most flexible
ways of supporting business
in emerging economies,
where businesses desper-
ately need machinery, office
and plant equipment.
The EFG is planning to
sign a joint venture deal on
November 12 to set up the
first leasing company in
Egypt.
The joint venture partners
are the National Bank of
Egypt; Commercial' Interna-
tional Investment Company
and' Orix Corporation of
Japan and Orix Leasing
Pakistan. Orix has been
working actively with the
IFC to introduce leasing
around the world.
The new Vietnamese com-
pany. Vietnam International
Leasing Company (VHX), is
expected to write leases of
$25.000-530, 000 for smaller or
micro enterprises and
*100,000-$150;000 for medium-
sized companies. IFC says
VILC will have “a strong
impact on Vietnam's finan-
cial sector by extending and
improving credit delivery
and introducing . new finan-
cial products to the local
market to encourage capital
■formation and investment.”
It will be based in Ho Chi
Minh. City and frnWaUy serve
. the surrounding region,
IFC has been working
closely with governments,
advising them on leasing
regulations, recruiting spon-
sors and technical partners
and ' Investing in new loagiTig
companies.
In Vietnam IFC launched a
technical assistance opera-
tion in 1991 and helped offi-
cials develop a legal frame-
work for licensing and
regulation.
An IFC paper, issued in
August, said one-eighth of
the world's private invest-
ment was financed through
leasing. Its share is soaring;
in some countries it provides
as much, as one-third of the
private investment
IFC has helped set up leas-
ing companies in over half of
the developing countries. In
August it provided *5.6m in
financing to help establish
Uzbek Leasing International,
the first specialised leasing
company in Uzbekistan.
The corporation also helps
leasing companies, in which
it has equity, to expand. Last
March it guaranteed a local
currency loan of $3m equiva-
lent for the Industrial Devel-
opment Leasing Company of
Bangladesh, established in
1986.
IFC's involvement allows
the company to borrow
locally for a longer period
than otherwise would be
possible.
IFC’s first leasing venture
was in 1977 in Korea. The
Korea Development Leasing
Corporation is now the
world’s fifth largest leasing
industry.
WORLD TRADE NEWS DIGEST
Airbus A3XX
engine deal near
Airims industries ti»Buropean aircraft manufacturing ]
consortium, is within days of signing memoranda of
understanding to develop engines for its planned ASXX
super-jumbo with Rolls-Royce of the UK and an alliance of
General Electric and Pratt & Whitney of the US. Both R-R
and the US consortium will be obliged to develop new
engines to equip .the four-engined jet The engines will
also be designed to power new “stretched’* versions of the
747 jumbo planned by Boeing of the US- .
An Airbus spokesman said: “We are talking to both the
General Electric/Pratt & Whitney grouping and
Rolls-Royce about the A3XX- We will be able to sign an
MoU pretty soon."
Both groups are expected to base their engines on
super-large engmesdesigned to power the Boeing 777, a
wide-bodied twirfjet, and its Airbus rival, the A330.
Rolls-Royce is Set to offer a new engi ne , the Trent 900,
with around BtoOOIbs of thrust. GE and Pratt have formed
an alliance to jointly develop an engine for the Boeing
aircraft, and are expected to offer the same power plant .
or a derivative, for the A3XX. Ross Tieman, London
Investment into India boosted
India’s Foreign Investment Promotion Board yesterday
cleared 63 foreign investment proposals worth a total of .
$694m. sus taining a recent drive by the four-month-old
United Front government to accelerate such approvals.
The cleared projects include two in the consumer goods
sector, one for Cadbury Schweppes, the drinks and
confectionery group, to establish a 100 per cent owned
soft drinks venture in Bombay, and another for Gillette,
the US personal products group, to take a 49 per cent
stake in a shaving bJ ate project .-•••■
’ Clearance was also given to De Beers Consolidated
Mines, the Twining group.' to ta ke a-50 per cent share in a
* 15 xn diamond mining project Mark Nicholson, New Delhi
EU transit system reprieve
A complete collapse of the TTR international transit
system for lorry freight in Europe was narrowly averted
this week when the two main German hauliers;
associations were persuaded to continue operating the
scheme after declaring their intention to puB out
However, the United Nations Economic Commission for
Europe, which oversees the TIR convention, warned
yesterday that the scheme would remain under threat
without longer-terin measures to combat growing
problems of fraud and smuggling.
P The German hauliers* associations, AIST and BDF, had
said they, would no longer honour TER pay
customs duties because, of delays and uncertainties In
i obtaining reimbursement from the International Brad
Union OBU) and
decision was rescinded after negotiations with the
of red tape.
ADB aid for Bangladesh
The Asian Development Bank (AD Bjfaad^ ered
^^r^rv^rtoy Ba^adesh. suffering a big power
"it cSSgbX electricity from tohla as a
by a
GoVer “ Den * M*nllA-based ADB that visited
mission ***“ progress erf bank-funded
®^^^m^o^tionX^esh Nationalist
however, have
party (BNP^some TOUl(i ^
strongly opposed argumK -
electricity . Energy countrv’s demand for
seminar this s oooMWby the year 2000 and
electricity would nse to 3,000 mw oy w * Dhaka.
4,600 MW by 2005.
L ess than two months
before the arrival of
its first foreign
guests, the new Gran Hotel
at Cuba's premier tourist
resort of Varadero still looks
more like a building site
than a four-star beach hoteL
Surrounded by scaffolding,
raw concrete- and construc-
tion debris, the hotel’s
Cuban manager, Mr Alexis
FerrioL smiles nervously
when asked whether all will
be ready to receive the first
scheduled busload of tourists
on December 15. “The hotel
is already sold through tour
operators,” be said.
Bust over a former holi-
day camp for Communist
Young Pioneers - a sign of
the changing times in Cuba
- the Gran Hotel is an exam-
ple of the frenzied but
erratic pace of new hotel
construction on the island,
which desperately needs to
maximise hard currency
tourism revenues to help
bolster economic recovery.
The communist govern-
ment's strategy to transform
Cuba into a big Caribbean
tourist destination has pro-
duced a growing crop of
joint ventures and manage-
ment contracts with
foreign hoteliers, mostly
from Europe and Canada. Up
to now these investors seem
generally undeterred by US
legislation aimed at curbing
foreign investment on the
island.
Following a rebuke from
Brazil
urged to
pursue
liberal
measures
By Frances WiBiams
in Geneva
Brazil’s trading partners
yesterday welcomed the
country’s overall progress
towards economic stabilisa-
tion and a more liberal trad-
ing regime but raised a host
of complaints over protec-
tionist measures in specific
sectors, notably the car
industry.
Members -of the World
Trade Organisation * con-
cluded a two-day discussion
of a WTO secretariat report
on Brazil’s trade policies
and practices by urging per-
severance with economic
reform and resistance
to protectionist pressures
despite the difficult adjust-
ment problems caused by
radical economic restructur-
ing.
The WTO report says uni-
lateral tariff cuts and other
trade liberalising measures
introduced by Brazil in the
early 1990s have been a key
element behind its subse-
quent economic gains.
However, moves since
1995 to restrict certain
imports and s u pport exports
have made the trade system
more, complex and less
transparent. These “poten-
tially trade-distorting mea-
sures” reflect “lapses in
implementation rather tha n
a policy reversal,” the WTO
suggests.
The report argues that
Brazil ’s large current
account and merch a n d ise
trade deficits may be doe to
an overvalued exchange rate
following introduction of
the Beal Plan in' udd-1994.
The plan, which ent infla-
tion from 5.000 per cent in
the 12 months to July 1994
to an estimated 10 per cent
this year, has prompted
large inflows of foreign capi-
tal-
The WTO report is partic-
ularly critical of Brazil’s
complex tariff s tructure and
frequent tariff adjustments,
which . have not been
improved by membership of
the Mercosur customs union
with Argentina, Uruguay
and Paraguay.
It also notes an increased,
recourse to anti-dumping
ami safeguard measures to
keep imports out, including
recent safeguard actions on
textiles and toys.
Meanwhile, protection far
the domestic car industry,
estimated to be equivalent
to tariffs of 250 per cent, has
been stepped up despite Bra-
zil’* position as a large net
vehicle exporter. • • j
Japan and the US, backed
by Canada, the European
Union and South Korea,
have already-brought formal
WTO complaints against the
new measures which give
tariff breaks to domestic
producers. .
In August Brazil intro-
duced low-tariff quotas for
vehicle imports from Japan,
Korea and the EU to a bid to
defuse criticism - but the
WTO complaints have not
been withdrawn.' - ■
A hotel nears completion. Cuba hopes to double capacity to nearly 50,000 rooms by 2000
President Fidel Castro about
the sluggish pace of hotel
building last year, Cuban
construction brigades are
straining to complete a tar-
get this year of around 5,000
new rooms, more than a
third of them at Varadero. 75
miles east of Havana. But
although the pace has picked
up, delays persist
On the less-developed east-
ern side of Varadero, a . 12 -
mile beach peninsula on
Cuba’s northern coast, half a
dozen new hotels, some still
unsightly skeletons, are rap-
idly emerging from the tropi-
cal vegetation.
The hotel construction
schedule was tight even
before Hurricane Lili lashed
Cuba with high winds and
heavy rain on October 17
and 18. Although the bad
weather disrupted work for a
few days, Cuban tourist
authorities reported with
relief that big beach resorts
such as Varadero, Cayo Coco
and Cayo. Largo suffered
only minimum superficial
damage which was quickly
repaired.
Deputy tourism minister
Miguel Brugueras said Cuba
was maintaining its target to
achieve a new record of lm
tourists this year. Tourist
arrivals up to September
totalled 715,800. nearly 38 per
cent more than the same
period last year, he added.
The government says it
urgently needs to raise tour-
ism receipts to even higher
figures, not only to help
finance economic recovery
but also to offset a balance
of payments squeeze caused
by rising costs of essential
imports and a downturn in
world prices of more tradi-
tional exports such as sugar
and nickel.
The Cuban tourism indus-
try is seeking to lift 1995
gross tourism receipts of
gl.lbn to $1.3bn this year.
Most visitors came from
Canada, Italy, Spain, Ger-
many and France. These
remain Cuba's main mar-
kets, in the absence of US
tourists, barred from visiting
by Washington’s longstand-
ing economic embargo.
Authorities in Varadero
are moving to clear up the
construction debris before
the November start of the
main tourist season.
Another sort of cleaa-up
has already taken place.
After declaring Varadero a
special tourist zone, police
launched a crackdown
against hundreds of prosti-
tutes who worked the resort.
And following complaints
from foreign hoteliers, they
also shut dozens of private
home restaurants and taxis
and prohibited Cubans from
privately renting out accom-
modation.
This accentuated Varader-
o's image as a kind of tourist
“ghetto**. But tourism has
boosted local living stan-
dards by providing jobs and
access to hard currency.
The new Gran Hotel
belongs to Cubans can,
Cuba’s biggest tourism cor-
poration. which along with
other Cuban companies has
entered selective joint ven-
tures and management con-
tracts with foreign partners.
These include Spain’s Sol-
Melia group and Tryp
Hotels, Jamaica's Super-
clubs. Germany’s LTI-Later-
national Hotels. Delta Hotels
of Canada, Italy’s Venta
Club, Golden Tulip of the
Netherlands and France's
Club Mediterran£ and Accor.
“What do we seek from
foreign investors? Fast
growth, know-how, access to
foreign markets and the use
of internationally known
names." said Mr Mario Sort,
Cubanacan vice-president.
Foreign investor interest
does not appear to have been
seriously blunted by the US
Helms-Burton law. intro-
duced on March 12 and
which threatens sanctions
against companies judged to
be “trafficking’' in expropri-
ated, formerly US-owned
properties in Cuba.
In April, an Anglo-Dutch
group. Vital, signed a deal to
help build a five-star hotel in
Varadero. In July, a Cana-
dian entrepreneur, Wally
Berukoff. clinched a $400m
deal to construct 11 hotels in
Cuba.
More recently, another
Canadian group. Journey's
End, is understood to have
agreed a similar big contract
to refurbish, build and man-
age several hotels.
Spain’s Sol-Melid group,
whose three joint venture
hotels in Varadero are
believed to occupy at least
part of land once owned by
the wealthy US Dupont fam-
ily. says It has so far
received neither claims nor
sanctions under the Helms-
Burton law. It is expanding
operations, but two other
Spanish groups. Paradores
Na cion ales and Occidental
Hotel es, are reported to have
halted investment plans.
Cuba's tourism develop-
ment programme foresees
doubling the existing 25,000
hotel rooms to nearly 50,000
by the year 2000, with an
estimated overall investment
of £L7bn.
Pascal Fletcher
Global chip market ‘will grow by 7.4%’
By Louise Kehoe
in San Francisco
The global semiconductor
market win grow by 7.4 per
cent next year to $138.8bn,
reversing a 10 per cent drop
this year, according to the
annual Semiconductor
Industry Association fore-
cast
, The US industry trade
group said that world
chip sales were expected to
return to strong double-digit
growth in 1998 and that
world - sales should top
$200 bn by 1999.
Although the annual fore-
cast has seldom proved accu-
rate, it is a reflection of ris-
ing optimism throughout the
semiconductor industry fol-
lowing a year in which the
market has shrunk for the
first time in over a decade.
As recently as 1994. the
global chip market was just
over SlOObn. so the 1999 fore-
cast suggests a doubling in
sales over a five-year period.
“1996 is merely a blip on the
industry's phenomenal
growth record." said Thomas
Armstrong, president of the
SLA
“Long-term prospects for
the chip industry are still
excellent because the world
has a ravenous appetite for
the electronic equipment
that relies on semiconduc-
tors," he said.
“Over time, chips will
become even more critical
parts of the world economy
than they are today."
In 1995, chip sales jumped
41.7 per cent. This year’s
market decline is largely a
reflection of sharp declines
in the prices of Dynamic
Random Access Memory
(D-Ram) chips, which
account for about 20 per cent
of the chip market.
D-Ram prices will continue
to fell in 1997, the industry
group said, although at a
more moderate pace than
over the past 12 months.
In contrast, sales of micro-
processor cbips, the brains
of personal computers, are
growing rapidly. 1996 sales
will be up 17.5 per cent, to
$l6.7bn. and will rise by 23
per cent next year to top
$20bn. the industry group
predicted.
Much of this rise reflects
booming sales for Intel, the
world's largest semiconduc-
tor manufacturer.
Industry executives noted
that excluding Intel from the
market data would produce
a very different picture of
the industry’s health.
Growth in microprocessor
sales is expected to account
for about two thirds of the
total anticipated sales
growth in 1997.
US chip sales will rise by a
modest 5.8 per cent in 1997 to
$44J2bn, the industry group
projected. The region will
remain the world's largest
chip market.
In Japan sales are expec-
ted to bounce back in 1997
with 6.6 per cent growth to
achieve sales of $36bn.
The Asia-Pacific region,
excluding Japan, is the fast-
est developing semiconduc-
tor market and is expected
to overtake Japan as the sec-
ond largest regional market
by 1999.
Next year. Asia-Pacific
sales are expected to rise by
11.6 per cent to almost $30bn.
European sales are expec-
ted to grow by 6.7 per cent
next year to $2S-Sbn-
Europe currently repre-
sents about 20 per emit of
total world sales.
■ *
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6
FINANCIAL times
FRIDAY NOVEMBER l 1996
ASIA-PACIFIC
US sanctions
threat angers
Malaysians
By James Kynge
In Kuala Lumpur
Malaysia, whose national oil
company faces possible US
sanctions for investing in
Iran, yesterday said that it
would use "international
forums” to challenge Wash-
ington's threat to impose
penalties on companies
investing in the Islamic
state.
“We are a sovereign
nation. . . We will not submit
to US dictation,” Dr
Mahathir Mohamad, the
prime minister, said.
The US has threatened to
impose sanctions under the
Iran-Libya Sanctions Act,
passed in August, on compa-
nies that invest more than
$40m a year in the oil and
gas sectors of the two coun-
tries.
Petronas. Malaysia’s state
oil company, has agreed to
take a 30 per cent stake in
two oilfields in Iran. The
total investment required to
develop the two fields was
estimated at $600m.
Although Petronas has not
made public the exact
amount of its proposed
investment in Iran, analysts
estimate it will exceed the
ceiling set by the US.
Malaysian officials have
tried to play down Petronas’
Involvement in Iran but the
issue was re-ignited this
week by comments by Mr
Gregg Rickman. legislative
director at the office of US
Senator Alfonse D' Amato,
who said the Malaysian com-
pany should face sanctions.
Ms Rafidah Aziz, Malay-
sia's minister for interna-
tional trade and industry,
told reporters yesterday that
Malaysia would question
Washington's right to take
action against companies on
the basis of what they
Mahathir: ‘will not submit’
did in third countries.
“This is not an issue of
Petronas, but a matter of
principle." Ms Rafidah said.
“The US has no right to
impose extra-territorial juris-
diction on other countries.”
Ms Rafidah added that
Malaysia would raise the
issue at the Asia Pacific Eco-
nomic Co-operation (Apec)
su mm it in the Philippines
this month. The issue may
also be raised at a World
Trade Organisation (WTO)
meeting in Singapore in
December, she said.
The WTO meeting is
already expected to be the
scene of heated exchanges
because of Washington’s
insistence that social and
labour reform should accom-
pany trade liberalisation.
Washington argues that east
Asia's rules on wages and
labour give some regional
countries unfair cost advan-
tages in trade.
The ringgit, Malaysia's
currency, dropped slightly
against the US dollar yester-
day partly because of fears
of worsening relations over
the Iran sanctions issue,
dealers said.
HK doubts raised over immigration row
By John Ridding
in Hong Kong
Retirement is supposed to bring a
more peaceful life. But that is
unlikely to be the case for Mr Laur-
ence Leung.
The Hong Kong director of immi-
gration has become the centre of
speculation since he resigned sud-
denly from his post this summer.
Controversy about his departure,
and claims of a cover-up, have
prompted the establishment of a
select committee in the legislature
to examine the case. The first
meeting win take place next week.
For the government - which has
trumpeted its improved transpar-
ency and implemented political
reforms which created Hong
Kong's first elected legislature -
the affair threatens an uncomfort-
able scrutiny. Pulling down the
shutters could set a troublesome
example as the territory prepares
to return to Chinese sovereignty in
July next year amid fears of
reduced accountability in the
a dminis tration.
Sensitivity Is increased by the
importance of immigration issues
ahead of the handover. With the
government stepping up efforts to
secure approval from diplomatic
partners for visa-free access for
holders of the territory’s post-1997
passports, the probe comes at an
awkward time.
In comments made earlier this
month in the Legislative Council
Mrs Selina Chow, a legislator from
the pro-business Liberal party and
a member of the select committee,
said it was essential that allega-
tions be addressed. “Unless the
matter is cleared up this will be
damaging to the administration
and to Hong Kong." While the 10
legislators pursuing the case
remain guarded on details of the
affair, attention has focused on Mr
Leung's relations with China and
reports be may have passed infor-
mation about the British national-
ity scheme to mainland officials.
The scheme, implemented after
Beijing’s bloody suppression of pro-
democracy demonstrations in 1989.
offered passports to 50.000 promi-
nent Hong Kong residents and
their families. Beijing demanded,
unsuccessfully, that it be given
information on civil servants
included in the scheme. Any leak-
age of names, it is feared, could
have a damaging effect, particu-
larly if information included names
of unsuccessful applicants.
“Instead of boosting confidence it
would have the opposite effect,"
said someone involved in lobbying
for the scheme.
Using parliamentary privilege in
the session called to vote on the
establishment of a select commit-
tee, Mrs Chow also cited reports
that information on Chinese dissi-
dents in Hong Kang might have
been passed across the border.
The government has dismissed
such claims. “Fanciful specula-
tion," said Mr Lam Woon-kwong.
secretary for the civil service.
Rejecting the view that public
interests are involved he has rig-
idly maintained the official line
that Mr Leung departed for per-
sonal reasons with mutual consent
between employer and employee.
Such a solid stance, however, has
failed to dissuade Hong Kong legis-
lators. “The circumstances were
very unusual,” said Mr James To
of the Democratic party, referring
to the fact that the usual notice
period was waived for Mr Leung.
He added that the government
sought to dissuade legislators from
pursuing the issue.
Intrigue was fuelled by the. fact
that Mr Leung's departure was
accompanied by the tersest of
statements and without any cus-
tomary praise. Pressed to com-
mend the former immigration
chief, Mr Chris Patten, the gover-
nor. said merely that “he worked
for many years for the Hong Kong
government". Mr To and his col-
leagues pledge to press until more
information is revealed. But they
face some difficult obstacles.
Under section M of the Legisla-
tive Council's powers and privi-
leges ordinance, officials can reruse
to testify, with a decision on
whether they must ultimately rest-
ing with the attorney -general. Per-
haps more significantly, the gover-
nor's assent is required for
witnesses to give evidence relating
to the security of Hong Kong.
That, said one committee mem-
ber. might obstruct investigations.
But, she argued, it would also fuel
suspicions. "You cannot claim per-
sonal reasons are involved and
.then turn around and say it is a
matter of security."
IMF deal a boost for Bhutto
By Farhan Bokhari
in Islamabad
The successful conclusion of
talks between P akistan and
the International Monetary
Fund to resume lending
under a $ 600 m standby loan
is the first bit of good news
in months for the belea-
guered government of Prime
Minister Benazir Bhutto.
The news boosted the
Karachi stock market, with
the 100 -share index rising
22.05 points, or 1.53 per cent,
on the back of the IMF
agreement.
The new finan ce minister,
Mr Naveed Qamar, who was
appointed this week after Ms
Bhutto gave up the portfolio
which she has held since
coming to power three years
ago, said: “This welcome
development should put an
end to the speculative behav-
iour of some vested interests
against the economic well
being of the nation."
Mr Antonio Furtado, who
led the IMF team in Islama-
bad, said the resumption of
Antonio Furtado, IMF mission chief (left), and Naveed
Qamar, P akistan 's new finance minister, yesterday muter
the standby loan could be
followed by reviving a
extended structural adjust-
ment facility (Esaf) next
year, if Pakistan met all the
performance targets. Pakis-
tan concluded a three-year
$1.5bn Esaf with the IMF
that began in February 1994,
but payments were
suspended a year later
because Islamabad felled to
achieve many targets. On
the stand-by loan, the Fund
is likely to release two
delayed tranches, worth
about $ 80 m each, “as soon as
humanly possible".
The Fund's decision to
suspend the loan after what
it regarded as Pakistan's un-
satisfactory budget in June
had triggered widespread
economic anxiety. Foreign
exchange reserves have
plummeted to $700m from
$i.7bn In June - enough for
3-4 weeks' imports - while
the rupee has been devalued
twice in recent months,
mostly recently by 7.86 per
cent last week.
In response to IMF pres-
sure, the government intro-
duced earlier this month an
emergency austerity budget,
which included spending
cuts and a 10 per cent
increase in oil .product
prices. The government
pledged to cut the budget
deficit to 4 per cent of gross
domestic product, though
analysts consider this ambi-
tious.
In spite of Mr Qamar’s
optimism yesterday, there
remain doubts within the
IMF and the opposition
whether the government will
be able to press ahead with
the most unpopular compo-
nents of its budget. These
include a farm income tax
which has angered the politi-
cally powerful agricultural
landowners' lobby.
Vietnamese press starts to
taste the fruits of freedom
Vietnam: a
growing hunger
for accurate
in fo r ma tion
W hen Vietnamese
film star Le Cong
Tuan Anh commit-
ted suicide by taking an
overdose of anti-malaria pUls
this month, his fans were
not the only ones to get
excited. Two Ho Chi Minh
City-based newspapers
snapped up the story, devot-
ing whole pages to the
drama of a failed relation-
ship that drove him to death.
They sent reporters along
to his funeral at a pagoda
where a crowd or 100,000 had
gathered. There were scuf-
fles and a wall collapsed.
The Communist party offi-
cials ordered coverage to be
toned down. But by then the
two papers - Tuoi Tre
(Youth) and Nguoi Lao Dong
(Workers) - had achieved
their desired aim: their cir-
culation doubled.
This is the new face of the
media in Vietnam, where the
country's 10 -year experiment
with economic liberalisation
has brought great change to
the formerly staid media.
YeL as in the case of Mr
Anh. the authorities have
not given up all their old
ways. Yesterday the authori-
ties, in effect, expelled the
Hanoi correspondent of the
Far Eastern Economic
Review, the first time the
country has got rid of a for-
eign correspondent since It
allowed foreign news organi-
sations to establish reporting
bureaux in 1990.
Domestic newspapers
have, in any case, been
forced to change because of
a cut in state subsidies to
many newspapers and televi-
sion stations that previously
had relied on handouts from
Hanoi. Now, many are adopt-
ing tactics more familiar to
European tabloids than to
socialist state censors in a
bid to boost readership and
revenue.
According to SRG Viet-
nam, a Ho Chi Minh City-
based foreign research
group, advertising spending
in Vietnam Increased to
almost $150m from about
$30m over the last five years.
Competition is fierce: there
are about 350 newspapers
and magazines nationally.
About 90 publications have
been launched since 1990.
But Hanoi is not entirely
happy with this develop-
ment. The challenge for the
party is how to cope with a
media that, through com-
mercialisation, is becoming
more responsive to its read-
ership at a time when the
party's desire to control
remains undiminished.
Vietnam does not require
its media to submit material
for censorship before publi-
cation. Instead, the Commu-
nist party appoints what it
considers as ideologically
reliable editors-in-chief to
each organisation. They are
responsible for ensuring that
coverage toes the party line.
U nder Vietnam’s
press laws, newspa-
pers are not allowed
to criticise “the achieve-
ments of the revolution” and.
party leaders.
Journalists are also
required to be "responsible",
although the term is not
defined.
Nowhere is the issue more
contentious than at Tuoi
Tre. It is the best example of
a newspaper that has suc-
cessfully ma n aged to tread a
delicate path between state
censorship and bold cover-
age of social issues and, on
occasion, party scandals.
A few years ago one of its
former editors was sacked
for running an article dis-
cussing whether Ho Chi
Minh had a wife. The former
president's private life is
taboo in Vietnam.
Yet Mr Nguyen Son
Phuoc, Tuoi Tre's current
deputy editor and a party
member, has managed to
turn it into one of the most
successful newspapers,
through successful manipu-
lation of party contacts and
sound business acumen.
The paper rents out office
space to Volvo of Sweden
and Nestle of Switzerland at
a building in central Saigon.
It has its own printing press
and plans to invest flOm
next year in real estate, con-
struction materials and a
hospital
His paper has been at the
forefront of attempts to
wean journalists off reliance
on the bureaucracy for infor-
mation. “if you get informa-
tion from the government,
it's not enough. You're just
han g ing your bead against a
closed door," he says.
Newspapers like Tuoi Tre
may be pushing editorial
boundaries to a degree, but
it is too early to speak of
editorial freedom. Corrup-
tion scandals are pursued in
the press only after the
party has given its approval.
Foreign and Vietnamese
companies often Include
cash in press packs as a way
of ensuring favourable cov-
erage of their activities.
This, coupled with the obses-
sive secrecy with which the
bureaucracy still treats most
kinds of information, is
likely to ensure Vietnam's
newspapers will shun issues
sensitive to the party and
stick to what pleases most
people - stories about film
stars.
Jeremy Grant
Mandarin Oriental, Manila .
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Airline strike likely to
embarrass Philippines
By Edward Luce in Manila
Philippine Airlines (PAL.)
yesterday threatened some
9.000 striking employees
with summary dismissal if
they failed to return to work
today on All-Saints Day -
one of the most important
religious holidays in the
country's calendar.
The warning escalates the
dispute just three weeks
before Manila plays host to
the Asia Pacific Economic
Cooperation (Apec) leaders'
summit.
The Philippine govern-
ment says the Apec trade
forum is the most Important
international meeting to be
held in the country since the
IMF-World Bank meeting in
1976 and is keen to avoid
embarrassments. President
Suharto of Indonesia and
President Jiang Zemin of
China are among 18 leaders
attending.
Manila's airport, which Is
being spruced up for the
arrival of is Apec heads of
state, could suffer heavily if
the strike persists. President
Fidel Ramos has so far
refused to intervene.
A spokesmen for Mr Lucio
Tan. chairman of the priva-
tised airline who recently
won a court battle with
minority government share-
holders to gain majority con-
trol of the national flag car-
rier. dismissed the walk-out
as a “wildcat" strike. Most of
PAL’s maintenance and
ground -handling crew are on
strike.
“PAL management has
advised striking personnel to
return to work not later
than Friday. November 1
or be deemed terminated
from the company." said an
airline statement yester-
day.
Government officials, who
have had running battles
with Mr Tan over alleged tax
evasion in hts beer and
tobacco subsidiaries, yester-
day expressed concern over
the possible ramifications of
the walk-out.
• Human rights activists
have challenged in the
Supreme Court the govern-
ment's decision to deny a
visa to Mr Jose Ramos-
Horta, Nobel peace prize
winner.
The government refused a
visa to the East Timorese
activist on the grounds that
he would pose a “threat to
national security" and
undermine Manila's rela-
tions with Indonesia before
the Apec summit.
Indonesia has faced wide-
spread international criti-
cism over human rights
abuses in East Timor.
Mr Ramos-Horta was to
have attended a parallel
summit on Apec next month.
The petition to the Supreme
Court was submitted by
Philippine human rights
groups yesterday.
Critics, including leading
senators and Cardinal Jaime
Sin. doyen of the 1986 “peo-
ple power” revolution which
overthrew the dictatorship
of Ferdinand Marcos, accuse
the government of betraying
the country’s democratic val-
ues.
The government - which
earlier this week leaked a
blacklist of other activists
who would be refused entry,
including Mrs Danielle Mit-
terrand. widow of the late
French president, and
Bishop Carlos Beio, joint
Nobel peace prize w inn er
from East Timor - said it
was giving priority to the
national interest.
China rejects
Wang critics
By Tony Walker in Beijing
China said yesterday the
sentencing of a prominent
dissident to 11 years’ jail had
nothing to do with human
rights and was strictly a
legal procedure.
“The trial of Wang Dan is
entirely a Chinese legal pro-
cedure carried out In accor-
dance with the law," said Mr
Shen Guofang, the foreign
ministry spokesman. “It has
no connection with human
rights or other issues.”
Mr Wang's sentencing has
drawn strong protests from
western governments and
Internationa] human rights
organisations. He was jailed
for allegedly seeking to over-
throw the government - a
crime which carries the
death penalty.
His family said he would
appeaL but it is extremely
rare under the Chinese jus-
tice system for judgments to
be overturned or for sen-
tences to be commuted.
“We are angry he received
such a heavy sentence even
though he was innocent,"
said Mr Wang Xlanzeng. Mr
Wang Dan's father. “Wang
Dan said he wants to appeal.
He feels everything that he
has done has been above-
board. . . it was all for Chi-
na's democratisation. “•
Mr Wang’s harsh sentence
deals a further serious blow
to China's flickering dissi-
dent movement. Beijing has
rounded up leading dissi-
dents systematically over
the past year in an apparent
effort to silence criticism.
China yesterday also
launched a strong attack on
western journalists, accusing
foreign reporters of lacking
an understanding of Chinese
conditions and engaging in
biased reporting. It com-
pared the present generation
unfavourably with Edgar
Snow, the American reporter
who recorded early stages of
the Chinese revolution.
“In his reportage. Edgar
Snow wrote exactly what he
witnessed.” said the official
China Daily. “What the west-
ern media is doing is the
opposite of what Edgar Snow
did 60 years ago.
“One may ask why there
have been 60 many disap-
pointing reports by western
journalists.” it said, adding:
“One clue lies in the fact
that those journalists do not
know what is really going on
in China." The world press
has, almost universally, con-
demned the sentence.
Britain, France and the US
have strongly criticised
China. A French official
said: “France notes with dis-
appointment that China does
not take account of Euro-
pean- feelings and- concerns.
France adds its voice to all
those requesting a revision
of this judgment on appeal.”
ASIA-PACIFIC NEWS DIGEST
Thailand trade
gap narrows
Thailand's large current account deficit has dipped below
the psychologically Important level of BtSObn ($l.l8bn) for
the first time in six months, suggesting the country's
economic woes may be easing, according to figures
published yesterday by the central bank. The deficit
shrank for the fourth month in a row to Bt29.3bn in
August from Bt31bn in July.
However, rapidly slowing export growth this year has
forced the Bank of Thailand further to trim its growth
forecast this year to 7.8 per cent, the slowest rate of
annual growth in more than a decade. Exports grew by a
slow 2.4 per cent in the first eight months of this year,
reinforcing the belief that the year-end figure would fall
short of the government's already reduced growth target
of 10-2 per cent export growth.
Manufacturing activity did pick up for a second
consecutive month in August and there was also a modest
expansion in foreign reserves to Bt39.5bn from Bt39.4bn in
July. The Stock Exchange of Thailand index climbed 4.22
points to 910.33. William Barnes in Bangkok
Property businessman charged
Mr Prasong Panichpakdee. nhairnian of one of Thailand's
biggest property companies, Somprasong Land, was
yesterday charged with doctoring financial statements
and breaking laws designed to protect customers.
Som pros ong' s ambitious expansion ran headlong into the
greatly over-supplied Bangkok residential property
market after its flotation in 199L The Bank of Thailand,
the central bank, yesterday sought to calm nerves by
insisting St was not worried that struggling property
companies might damage the banks and finance houses
that lent them money. William Barnes. Bangkok
Indian warning to Pakistan
India yesterday warned It would review the “entire
gamut” of bilateral relations with Pakistan should it fail
to protect I n dia n diplomatic staff in Islamabad, the Press
Trust of India said. It said the Indian warning ntmo after
Pakistan suggested the two estranged neighbours should
call a “truce" on picking off each other's officials.
Meanwhile a non-diplomatic official of India's embassy
In Islamabad returned with his wife to New Delhi after
being ordered to leave Pakistan. Mr Ashok Kumar Wahl's
return came a day alter Indian police arrested Mr Hafiz
Mustataque Khosa, a nan-diplomatic staff member of the
Pakistani High Commission on charges of spying in New
Delhi. The tit-for-tat expulsions came a month after
P akis t an and India ousted diplomats from each other's
capitals for alleged spying. AFP, New Delhi
Bangladesh sell-off planned
Bangladesh's Securities and Exchange Commission chief
yesterday said the government would sell up to 2 bn taka
($4 7m) worth of shares in state-owned companies listed on
the Dhaka stock exchange by the end of fiscal 1996-97 to
beef up the stock market. "The government as a first step
will privatise the companies which are already listed with
the Dhaka Stock Exchange to increase the market depth,"
Mr Haroonur Rashid said. He said the government would
sell its stakes in all multinational companies, which
number about eight by December. Reuter. Dhaka
a r *h
cr ifio
id trade v
TOWS
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J^lNANCXAi. TIMES
FRIDAY NOVEMBER 1 1996
NEWS: INTERNATIONAL
W orld Bank
management
criticised
By Robert Ctiofea,
Economics Etfitor
The management of the
World Bank has come under
fire from members of its
executive board, after the
development organisation's
in-house watchdog warned
that its work on poverty
reduction was inade qu at e.
In a recent internal report,
the Bank's Quasi -indepen-
dent Operations Evaluation
Department produced a
lengthy critique of the con-
tent and use of “poverty
assessments". These coun-
try-specific reports, which
cost more than $ 220,000 each
to produce, are supposed to
ensure that poverty reduc-
tion is prioritised in the
Bank's assistance to bor-
rower countries.
At a meeting of the Bank's
board in September, one
executive director described
the report as “catastrophic”
and several said that it cast
doubt on the seriousness
with which management »wd
staff approached the task of
poverty reduction. The man-
agement argued in turn that
the report was overly rigid
and too negative.
The report looked at 46
poverty assessments
between 1988 and 1994, com-
paring them with standards
laid down in an operational
directive on poverty reduc-
tion Issued in 1991. The
report concluded the quality
of the assessments improved
after the directive came out.
but that more thaw 40 per
cent were still inadequate.
The watchdog added that
the content ■ of poverty
assessments had only “a
modest Influence" on the
country assistance strategies
and that there was only a
weak link between the
assessments and the extent
of poverty-targeted lending.
“Country assistance strate-
gies focused over whelming ly
on broad macroeconomic
stabilisation and s tructu ral
reform issues, with fbw ref-
erences to. the status or
causes of poverty, or to
approaches to poverty reduc-
tion.” the report said.
The Bank's formal policy
on poverty reduction identi-
fies three main objectives:
broad-based, job intensive
growth; investment in
human resources and espe-
cially the poor; and the pro-
vision of safety nets for vul-
nerable groups and the very
poor. But the report noted
that some poverty assess-
ments - notably from the
Latin America and Carib-
bean office - focused on only
one part of this s tr a tegy.
“Bluntly put, a significant
mismatch appears to exist
between the ambition and
specificity of [the opera-
tional directive] on the one
hand, and the per f ormance
of the Bank and its borrow-
ing member countries in
delivering on its provisions,
an the other.” it concluded.
Uzbeks’
hard
currency
problems
increase
By Sander Thoone a
in Almaty
Uzbekistan's efforts to ease
a shortage of hard currency
backfired this week, boost-
ing black market rates of
the dollar and driving many
importers of western goods
to either increase prices or
halt business altogether.
Shelves of many western-
owned supermarkets have
run -out of supplies and
prices of electronics have
shot up as traders struggle
to adapt to new restrictions
on the purchase, use and
export of hard currency. The
street exchange rate of the
sum. the local currency, has
lost 80 per cent of its value
in recent weeks as Uzbeks
rushed to change their s ums
into dollars illegally.
Uzbekistan has faced a
hard currency shortage
March because of dis-
appointing export rev en u es .
Rather than selling gold
reserves or lowering the
exchange rate of the sum,
however, the government
has left even its largest
investors dangling with mil-
lions of dollars in local cur-
Tcncy.
“We’re only getting a frac-
tion converted,” said Mr
Hikmat Ozmaden, general
manager of Tasbkochavto, a
dealership for Turkish-made
Plat cars. “But they will
solve their problems. This is
temporary.”
Mr Ozmaden said the gov-
ernment had ba nn e d co nver-
sion of revenues from pas-
senger car sales, his main
business, and started charg-
ing a 30 per cent commis-
sion on every dollar con-
verted from sales of car
accessories, parts and lubri-
cants.
Mr Igor Melnikov, head of
strategic research at the
National Bank, Uzbekistan's
largest commercial bank,
CT iii that sum revenues on
some foodstuffs, including
chewing gum, beer and
tobacco were at the bottom
of the waiting list for con-
version.
u We have sizeable gold
reserves -they can cover all
imports for seve ^, nM ^^.
Mr Melnikov Mid. “Prob-
lems arose while re started
moving towards convertiM-
Sy. But they were more
organisational than eco-
nomic.” . ,
“There's no fundamental
problem with the ecOTomy,
one western economist Mid,
“but they have no great
faith in market measure®
working in solving P»Jj
lems. They felt they 'could
weather the storm with a tot
of short-term, rationing.
That didn’t work.”
Attack on
Taliban
positions
in Kabul
restarts
Forces loyal to the ousted
Afghan government bombed
Kabul and launched a blis-
tering assault on Taliban
troops north of the capital
yesterday, breaking . a
two-day JuD. in Afghanistan's
latest war, Reuter reports
from Kabul.
The assault, on both the
De Sals pass about 20 miles
north of Kabul, and another
pass. Khair Khana, also
north of Kabul, began early
yesterday morning.
It was followed shortly
after by a bombing appar-
ently aimed at the capital's
mate airport In northeastern
Kabul, which killed three
chfldreri and wounded seven
people.
Witnesses said the ahport,
used for both military and
civilian traffic, appeared
undamaged.
“The objective Is to
advance as far forward as
possible," Mr Mehrabuddin
Masstan, a spokesman for
the commander of former
government forces, Mr
Ahmad Shah Masood. told
reporters at the force's head-
quarters in Jabal os-Siraj
further north.
Mr Masstan raid he could
not confirm -whether any
ground had been secured by
the anti-Taliban alliance,
wiflrie up of Masood’s troops
and heavy weapons and
those of the northern Uzbek
leader. General - Abdul
Rashid Dostum.
Bat he said the assault
was “progressing well".
The assault on the passes
is the third in nine days. The
previous two attacks were
stalemated around both
pnawa, viewed by the former
government as “the gates to
Kabul”.
A senior -source in Mr
Masood’s camp . said retaking
Kabul from the Taliban mili-
tia was both politically and
militarily vital
Taliban shells also landed
near the old road into Kabul
below the Khair Khana pass.
A commander on the old
road reported fighting
around the village of Hus-
sein Kot, about 20 km (12
miles) north of KabuL
The Pakistan-based
Afghan Islamic Press (AIP)
agency reported later yester-
day that a commander loyal
to the ousted Afghan govern-
ment on Wednesday
launched an attack on the
Taliban in Dara-i-Noor.
about 28 miles northeast
of the eastern city of
Jalalabad.
Sources close to^ com-
mander Hazrat Ali told AIP
his forces had seized the
area after killing many Tahr
ban fighters and capturing
at least 20 .
Nigerian logging scheme hits a logjam
Paul Adams on the scandal surrounding plans which threaten a valuable conservation area
D ud cheques worth
N600m <$ 7 - 5 m) may
seem unlikely to
save a rainforest but the
fraud scandal rocking the
Federal Environmental Pro-
tection Agency (Fepa) could
help delay a logging scheme
which threatens Nigeria's
most valuable conservation
area.
Gross River National Park
in south-east Nigeria is the
last big rainforest in West
Africa. A new timber opera-
tion covering ZOOsqkm on
the edge of the park by the
Chinese-owned Wempco
industrial group has pro-
voked a storm of protest
locally and abroad, and
forced it to submit an envi-
ronmental impact assess-
ment (ELA) to the agency,
only the second company
ever to do so in Nigeria.
Conservationists warn
that Wempco’s logging
scheme threatens t he entire
6,000 sq km Cross River for-
est - 40 per cent of the forest
remaining in a country
where 95 per cent has
already been destroyed- The
area contains at least 1,500
plant species, some of them
endemic to the area, the only
population of gorillas In
West Africa and dozens of
other endangered species.
But Fepa appeared to have
dismissed the environmen-
talists’ arguments and was
on the verge of approving
Wempco’s scheme last
month when the scandal
broke.
Dr Evans Aina, its direc-
tor. and other senior officials
were detained over embezzle-
ment of Fepa’s funds, alleg-
edly to support an insolvent
bank in Lagos with which
they had connections.
The Nigerian Conservation
Foundation (NCF), backed
by the Worldwide Fund for
Nature, had urged the fed-
eral government “to reject
existing plans to log
Nigeria’s last rainforest".
Wempco’s environmental
assessment only covers the
impact of the scheme on 1
per cent of its timber conces-
sions, proposes a plantation
system which will destroy
biodiversity and fails to
recognise the role of local
communities in forest man-
agement said the NCF.
“We believe that these are
errors and omissions which
make Wempco’s E1A docu-
ment seriously flawed and
an unfit and insufficient
basis to give Wempco the
go-ahead to log the rain-
forest" said the NCF. “There
are constructive ways to log
the rainforest but a proper
ELA should be conducted to
address the shortfalls."
The arrest of the director
has temporarily paralysed
Fepa but the NCF suspects
that Wempco has begun log-
ging without approval.
The company has already
built access roads to link its
large new saw mDl at nearby
Ikom to their remote conces-
sions in the forest The Chi-
nese company and the gov-
ernment of Cross River state
see the scheme as a lucrative
new venture employing
more than 1,000 people in a
state which needs such
investment more than it
needs the national park.
But critics of Wempco say
the $4m plywood and veneer
saw mill at Ikom was built
to bandit for more timber
than Wempco’s forest con-
cessions can legally supply.
They claim the project will
encourage illegal logging
and undermine community
forestry schemes which the
EU and other donors are try-
ing to establish.
Environmentalists say
Wempco has a bad record in
an earlier logging operation
in the Omo forest, one of the
few habitats for rare
monkeys and the few ele-
phants left in western
Nigeria. The company was
accused of illegally logging
protected trees for export,
prompting the government
of Ogun state to suspend
Wempco’s operations in Omo
and close down its nearby
plywood and veneer factory.
Wempco is reluctant to
comment but insists that it
is not out to destroy the for-
est, that it will protect it by
employing local people in
legal logging and that the
environmentalists’ campaign
against the company is a
false alarm that is mislead-
ing the public.
For decades, hunting and
fanning by a growing popu-
lation have encroached on
the Cross Rive r fore st In a
1990 report the WWF warned
that without prompt action
the upland Okwangwo area
would be “of trivial signifi-
cance for conservation
within 10*15 years."
A year later the federal
government made two thirds
of the forest a national park.
Conservationists are gradu-
ally persuading communities
in and around the park that
they are better off preserv-
ing the forest than hunting
and farming in it.
One such project the Xkuri
Initiative. Is recognised by
the state government as a
model for community for-
estry. The Pandrill us rare
monkeys breeding pro-
gramme has won Interna-
tional awards for its commu-
nity work at Afi mountain.
The European Union project
to develop the economy and
protect the forest around the
Okwangwo division is win-
ning local support.
The Fepa's lack of sympa-
thy with the conservation-
ists follows criticism of the
park from the Cross River
state government, which
recently claimed compensa-
tion from the federal govern-
ment for loss of revenue
through the creation of the
national park.
Mr Frank Afufu, the com-
missioner for agriculture
and forestry in Calabar, the
state capital, says the cre-
ation of the Cross River
national park in 1991 and an
EU . aid project, now can-
celled, raised false bopes.
Conservationists say the
claim, coinciding with the
arrival of Wempco, has left
the forest in severe jeopardy.
Mr Afufu believes fears
are exaggerated.
“We want the national
park but people can’t die to
let a tree live. You have to
provide an alternative way
to make a living. The devel-
opment which our people
believe in is ocular develop-
ment - what they can see."
says Mr Afufti.
“Nigeria should follow the
lead of other African coun-
tries - South Africa, Gabon
and Ghana - and Join the
worldwide movement for
certification for all forestry
operations by the Interna-
tional Stewardship Council, "
said Mr Philip Asiodu. a for-
mer oil minister, who heads
the NCF.
“The companies now
descending on us here have
all been affected by the
stricter controls now
imposed in countries like
Thailand, Malaysia and
Indonesia. The risk Is that
there will be five years of
destruction and then they
will move on like termites."
Abacha medal award prompts UN dispute
By Fr ance s Williams fci Geneva
A diplomatic row is brewing in
Geneva over the recent presenta-
tion of a gold medal to General
Sanl Abacha. the Nigerian presi-
dent, by the head of the World
Intellectual Property Organisation
(Wipo), a United Nations agency.
The award was given in spite of
condemnation of Nigeria’s human
rights record by two other UN bod-
ies, the Human Rights Commission
and the International Labour
Organisation, and the country's
suspension from, membership of
the- Commonwealth for human
rights violations.
The presentation, made without
the knowledge of other Wipo mem-
ber governments and most Wipo
staff, apparently took place in
Sani Abacha; medal normally
given to inventors
Abuja, the Nigerian capital, during
a visit in October by Mr Axpad
Bogsch Wipo director general. The
US is demanding an explanation of
the award.
In a letter to Mr Bogsch express-
ing Washington’s “deep concern",
Mr Daniel Spiegel, US ambassador
to the UN in Geneva, notes the
Wipo gold medal is normally given
for significant achievements by
inventors.
“We are not aware that Gen Aba-
cha has made si gnifican t contribu-
tions as an inventor, nor has
Nigeria proven to be particularly
deserving of special recognition for
its progress in advancing the pro-
tection of industrial property
rights,” the letter says.
Nigeria is said by international
business groups to be a thriving
market for counterfeit goods,
including films, television pro-
grammes and sound recordings.
Mr Bogsch. a Hungarian-born US
citizen now in his late 70s who has
headed Wipo since 1973, was not
available for comment yesterday.
This latest incident follows another
dispute in September over an ambi-
tious plan for a new Wipo building,
now being re-examined after US
intervention.
Western diplomats yesterday
confessed bafflement over Mr
Bogsch’s motives for giving the
award. One speculated that Mr
Bogsch. who retires next year, was
trying to boost the chances of Mr
Carlos Fernandez Ballesteros,
Wipo’s Uruguayan assistant direc-
tor general, to succeed him. Mr
Ballesteros accompanied Mr
Bogsch on the trip to Abuja.
Another suggested Mr Bogsch
may have felt obliged to accept a
Nigerian government recommenda-
tion that Gen Abacha receive a
medal. Mr Bogsch “showers two to
three medals wherever he goes.”
the diplomat said, noting that the
president of Uzbekistan had
received one last year. However, In
his letter Mr Spiegel argues that,
as a specialised UN agency, Wipo
has an obligation to respect UN
mandates and recognise the politi-
cal consequences of its actions.
He said yesterday that it was
“outrageous and bizarre" for an
award for inventive genius and cre-
ative talent to be given to the head
of a government that had forced its
only Nobel Laureate, writer Wole
Soyinka, into exile and executed
another writer. Ken Saro-Wiwa.
under “very questionable” circum-
stances a year ago.
Settlements
policy under
fire in Israel
By Judy Dempsey
bi Jerusalem
The Israeli government is
actively pursuing a policy of
expanding Jewish settle-
ments as well as encourag-
ing people to live in the West
Bank by offering finanriaT
incentives. Peace Now,
Israel’s most prominent
peace movement, said yes-
terday.
The settlement policy will
be allocated Shk600m
C$l83m) from the 1997 bud-
get, double the amount in
this year’s budget
Mr Mossi Raz, a Peace
Now activist who has scru-
tinised the 1997 budget said
the government would
finance its settlement poli-
cies by trimming the bud-
gets of ministries not
involved in the settlements.
“While ordinary Israelis
have to face a Shk4.9bn cut
in social welfare pro-
grammes, the settlements
will be spared any of these
measures." added Mr Raz.
“We are sure of one t hing .
There is now a conscious
policy of expanding the set-
tlements and encouraging
people to settle in them."
Settlers will continue to be
granted a tax reduction of
seven percentage points
from their salary.
Peace Now earlier in the
week sent a letter to Mr Ben-
jamin Netanyahu, the prime ■
minister, to coincide with
the first reading of the bud-
get, which aims to cut the
budget deficit to 2J5 per cent
of gross domestic product
next year compared with SB
per cent this year.
It protested about the 100
per cent rise in spending for
the settlements as well as
the fact that 90 per cent of
the budget allocation was for
areas beyond the Green
Line, Israel’s pre-1967 bor-
ders.
A dose reading of the 1997
budget proposals show that
the housing and construc-
tion ministry will be allo-
cated Shkl72m tO flniab
housing prefects started in
the West Bank between 1990
and, 1992 but unfinished- by
the former Labour govern-
ment, . which itself had
embarked an one of the big-
gest settlement expansions
during its tenure in office.
The agriculture ministry
has been given a budget of
Shkl4£xn for new settle-
ments and the ministry of
industry and commerce baa
additional spending of
Shk09m far investing in set-
tlements on the West Bank.
The state-run Israel Tr e nd s
Authority, the country’s
largest landowner, will be
given ShklBSm. a 15 per cent
increase on this year’s bud-
get - which was not spent -
specifically far expropriating
land at Har Homa.
Har Homa is in east Jeru-
salem where Israel’s jurisdic-
tion is not recognised under
international law. It has
been earmarked for develop-
ing a Jewish-inhabited dis-
trict.
Meanwhile, the - govern-
ment would not confirm
whether a plan drawn up by
Pressure is
coming from
ultra-Orthodox
communities
Mr Avigdar Lieberman, the
director general of the
prime minister's office,
would grant new settle-
ments in Gaza and the
West Bank “high national
prioilty”.
The government is coming
under pressure from the
ultra-Orthodox communities
to make more new
housing available for the
settlers.
• Almost all buildings
demolished by Israeli regula-
tors since 1993 for unlicensed
construction belonged to
Arabs, the Haaretz newspa-
per said yesterday, Renter
reports from Jerusalem.
The newspaper, which
examined Interior Ministry
reports, said 90 per cent of
all flVg ai buildings razed in
Israel and East Jerusalem in
the last three years were
constructed by Arabs.
It soldi however, that
Arabs were responsible for
only 65 percent of all con-
struction without a permit
LaSalle Partners
is pleased
to announce
the acquisition of
CIN Property Management Limited
responsible for a *£1-5 billion portfolio
and the subsequent formation of the UK property
investment management firm
CIN LASALLE
Investment Management
Regulated by IMRO
The combined group in the UK will have the range of resources,
infrastructure and market presence required
to deliver superior performance to clients.
LASALLE PARTNERS
8
FINANCIAL TIMES FRIDAY NOVEMBER 1 1996
NEWS: UK
Committee will consider whether outside body should oversee insurance market
Lloyd’s may broaden regulation
By George Graham
in London
The Lloyd's insurance
market is reviewing whether
its regulatory functions
should be passed to an out-
side organisation.
Lloyd's yesterday
announced the formation of
a review group under the
chairmanship of Sir Alan
Hard castle, who chairs its
existing regulatory beard, to
examine arrangements for
overseeing the market.
The group's terms of refer-
ence say it will consider
“whether organisations
other than Lloyd's should
undertake or supervise any
regulatory activities.”
Sir Alan said the review
would involve the Securities
and Investments Board, the
regulator of most of the rest
of the City of London's
financial institutions and
markets under the 1986
Financial Services Act
Lloyd's is regulated under
its own 1932 act of parlia-
ment and largely exempt
from the FSA. though the
government's Department of
Trade and Industry has a
role in protecting policy-
holders' Interests. Bringing
it under the SIB would
require fresh legislation.
Although a committee of
the House of Commons said
last year that the Insurance
market's regulations needed
overhauling, the government
has ruled out any action
before the summer of 1997.
The 13-member review
group will also consider the
structure and staffing of
Lloyd's regulatory division
and the composition of its
regulatory board.
Efforts to review Lloyd’s
regulation and internal
structures have for the last
five years largely been side-
lined by the market's trou-
bles.
In September, however,
the DTI approved the cre-
ation of Equitas, the reinsur-
ance company Into which
Lloyd's is transferring about
£12bn of mainly US liabili-
ties outstanding on policies
sold before 1993.
Approval came after more
than 90 per cent of the 34.000
Names - the individuals
whose assets have tradition-
ally supported the market -
agreed to accept a £3.2bn set-
tlement offer to end legal
action against Lloyd's.
Much remains unclear
about Lloyd's future shape.
The unlimited personal lia-
bility of the traditional
Names Is being replaced by
new corporate investors -
professional fund managers
and insurance specialists
which have pumped £L5bn
into limited liability corpo-
rate members at Lloyd's in
the past three years.
If that trend continues,
Lloyd's officials say, it could
change the sort of regulation
that would be appropriate.
Transferring Lloyd’s regu-
lation to another body, such
as the SIB, would have much
s u pp or t wi thin the market.
Bus industry
alarmed by EU
design ideas
Operators fear new standards
could force their costs to rise
The British bus industry
fears that proposed Euro-
pean Union rules on con-
struction may make bus
travel less attractive. The
European Commission's
industry directorate (DG3)
proposes to publish a direc-
tive laying down standards
for the construction of buses
and coaches within the next
few weeks after four years of
wrangling and no fewer than
eight drafts.
The Industry fears that the
draft directive could push up
the cost of buying vehicles,
reducing the already slim
margins many operators
make. UK requirements to
improve disabled access are
currently forcing bus opera-
tors to invest in more expen-
sive low-floor and “kneeling"
buses.
British bus operators com-
plain that the directive is
based on the mainland Euro-
pean approach to bus design,
which allows for relatively
few seats but plenty of
standing room. Buses in
Britain and Ireland have tra-
ditionally offered more seats.
The British bus industry
still has deep misgivings in
spite of assurances from Mr
Neil Kinnock, European
transport commissioner, to
the Confederation of Passen-
ger Transport, representing
bus, coach and tram opera-
tors. “We hope that the
directive will concern itself
with matters of safety rather
than comfort, which are best
left to the individual mem-
ber states or to the opera-
tors," said Mr Dennis
Flower, operations director
of the confederation.
The main proposals on
which Brussels has been
working include allowing a
greater number of standing
passengers while reducing
the number of seats. Up to
eight standing passengers
would be allowed per square
metre compared with the
five at present permitted in
the UK.
The directive is also expec-
ted to call for an increase in
the number of doors and, on
certain classes of double-
deckers, the installa tion of a
second set of steps to the top
deck.
“These proposals have
European bus and coach comparisons
1998 (*1991 **1982}
Pop’n
m
Busy coaches
vehicles
000
vehicle
bn ton
P as seng e r km
trave Be d by
bus/ coach.
total per
Bri tain 's two main political
parties yesterday called for
London's distinctive Route-
master bases to be saved
after it was suggested they
may be scrapped by 2000,
Liam Halhgan writes.
more to do with technical
standards than with com-
mon sense,” said Mr
Anthony Pursey. commercial
director of Walter Alexan-
der, a UK bus and coach
body builder. “We found no
evidence of any passengers
being seriously injured or
killed over the past decade
because there was no second
stair case on double deck-
ers.”
The confederation believes
that, far from enhancing pas-
senger safety, any moves to
reduce seating in buses and
to increase the number of
doors will increase the risks
to travellers.
“We are convinced that a
seated passenger is always
safer than a standing one,”
said Mr Flower. “Further-
more. the UK bus industry
- - - ‘ w p* -"
Northern Ireland 1.6 2 - - -
Belgium - mi 15 0 A" 4.7 465
Finland - 5.1- . S .. 0£ B.0 1569
j$» s^jbsE .
Germany - 80-6 71 4.7 71.1 882
Irish Republic 3.6=’ 6 D-3~ -
Luxembourg OA 1 - _ -
Portugal 9.9 1 11 0.7 " 11Ji 1102
Sweden - 8.8 ' 14 (LB IOlP -1239
Britain has tha thU high oa t omrat kanri of. bus and coach hmI to IM4
taut only imjcij Mghaat Ma of trim and coach mm pw mm tri ptputakn
has progressively reduced
the number of vehicles with
centre and rear doors
because of the risk to pas-
sengers boarding and alight-
ing out of the driver’s direct
line of sight.”
In addition, bus operators
do not like doors away from
the driver because of the
increased nhnnrv» of passen-
gers avoiding paying their
fare and the need to position
bus doors alongside shelters
and platforms at bus stops.
Bus operators fear that the
shift away from dou-
ble-decker buses to smaller,
more economical and flexi-
ble mini and midi-buses
which followed the deregu-
lation of the UK bus indus-
try in the mid-1980s could
also be jeopardised by EU
le gislation _
One element of the direc-
tive is expected to be a regu-
lation on the ■minimum
width of seats. This would
have the effect of reducing
the number of seats abreast
which could be installed
from four to three and make
their operation uneconomi-
cal This would be in line
with mini buses which
account for 12 per cent of the
UK bus fleet,
EU member countries will
be allowed to seek exemp-
tion from the terms of the
directive until a review
planned for 2005 but British
bus operators described this
as a “fudge” which at best
would postpone the imposi-
tion of unattractive regula-
tion.
Charles Batchelor
Phones innovation is linked to Philips
By Alan Cane In London
A nine-month-old UK
company has developed a
system which offers small
and home-based businesses
the advantages of large, com-
puter-based telephone
exchanges at a fraction of
the cost.
The system, called “Imagi-
nation”. has been designed
and developed and is manu-
factured by Telecom Sci-
ences Corporation for Phil-
ips, the Dutch electronics
group- TSC bought Philips'
telecoms manufacturing
business in Airdrie. Scot-
land, in February this year
for £28. 1m t$45.8m).
“Imagination” enables
companies with only a hand-
ful of telephone lines to take
advantage of “computer-
telephone integration" an
advanced system used by
large companies to recall
customer details speedily,
and ISDN (Integrated Sub-
scriber Digital Network),
high speed telecommunica-
tion lines which form the
foundation of the informa-
tion superhighway.
CTI systems can cost tens
of thousands of pounds
which has limited their use
to large companies. The new
system, however, has an
entry level price of £699 for a
home business rising to
about £11,000 for a medium-
sized company with 250 tele-
phone lines.
Mr David Boyce, TSC chief
executive, said he expected
the company to have sales of
£80m in Europe by the end
of next year with almost half
the total in the UK.
The UK lags behind other
European countries in the
adoption of ISDN lines,
which are capable of trans-
mitting voice, data and video
images simultaneously. This
is chiefly because of cost In
the Netherlands, for exam-
ple, it is now cheaper to
install an ISDN line th an a
conventional telephone line,
while Germany has stimu-
lated demand by paying
DM700 ($463.50) towards the
cost of equipment to be used
on a newly installed ISDN
line. British Telecommunica-
tions is keen to stimulate
demand for ISDN lines and
has recently announced new
tariffs.
Mr Boyce says the use of
“Imagination” equipment
and an ISDN line would
eliminate the need for sepa-
rate pieces of equipment
such as fax machines and
telephone answering
machines.
Reform of
N Ireland
terror law
proposed
By John Kampfher,
Chief Political
Correspondent
The British government was
yesterday presented with a
radical prescription for
reforming anti-terrorist leg-
islation to Northern Ireland.
The recommendations
were contained in the find-
ings of a year-long inquiry
by Lord Lloyd of Berwick,
who was asked by ministers
to look at changes in the:
event of lasting peace in
Northern Ireland.
Some of the suggestions
relating to human rights In
Northern Ireland are likely
to be dismissed by pro-
British politicians in the
region and many Conserva-
tive members of the House
of Commons.
The report was commis-
sioned two months before
the Irish Republican Army
broke its ceasefire in Febru-
ary. With the inquiry remit
seemingly out of date, many
of its more controversial pro-
posals are likely to be
shelved.
The opposition Labour
party, however, called the
report a “significant contri-
bution” which showed how a
second IRA ceasefire “could
transform the framework of
law and order throughout
the UK”.
The legislation Is intended
to replace the pasting Pre-
vention of Terrorism Act,
which applies to the British
mainland, and the Emer-
gency Provisions Act for
Northern Ireland which are
both subject to annual
review.
The report makes clear
that, even if peace is agreed
in Northern Ireland, perma-
nent anti-terrorist legislation
will be required.
One of the aims is to pre-
empt future challenges
against Britain by European
courts. Among the sugges-
tions are:
• Ending exclusion orders,
which have been used in the
past to prevent individuals
from entering Britain from
Northern Ireland.
• Ending so-called
“Diplock" courts in North-
ern Ireland, set up to allow
judges to cast verdicts
Instead of juries because of
intimidation.
• Replacing the seven-day
pre-trial custody for terrorist
suspects. In future, an initial
48-hour could he extended
only by two days through a
decision of judges rather
than ministers.
• Introducing a statutory
provision enabling judges to
ensure that a minimum term
stipulated for a life sentence
reflects the severity of a ter-
rorist crime.
• Encouraging informers
with a discount of one-third
to two-thirds off a sentence
if they testify for the prose-
cution. Currently it is at the
discretion of judges.
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London El — — < — -—*•**
Tel: 0T7T 247 5000 mttty uvtim-
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CONTRACTS & TENDERS
INVITATIONS FOR
EXPRESSIONS OF INTEREST
WIT HAM PROSPECT
The Coal Authority has received an Application for a
Conditional Operating Licence (Underground) in relation
to an area of 19.956 ha. in the counties of Nottinghamshire
and Lincolnshire and bounded by the towns of Newark,
East Retford. Tuxford and the City of Lincoln. The area is
centered on National Grid Co-Ordinates E 482.000 N
365.000 and relates to the Top Hard Seam.
Persons wishing to make alternative expressions of
interest in relation to coal mining operations in this area
should submit particulars to the Director of Licensing by
31st December 1996.
Expressions of interest should be delivered to:-
The Licensing Department
The Coal Authority
Bret by Business Park
Ashby Road
Burton on Trent
Staffs. DEI 5 0QD
The subsequent timescale for submission of complete
applications will be discussed with interested parties.
Pension debt stirs Emu debate
By James Blitz,
PoEtical Correspondent
The cabinet was yesterday
embroiled in a new row over
sterling's membership of a
single currency following
publication of a report into
Europe's public pension
schemes.
In spite of a determined
display of unit}' over Europe
at last month's annual con-
ference of the governing
Conservative party. Mr Ken-
neth Clarke, the chancellor
of the exchequer, and Mr
Peter Lilley, the chief social
security' minister, appeared
divided over a report
expressing alarm over
“unfunded” pensions
schemes in European Union
states.
Mr Lilley was said to be
warmly supportive of an
investigation by the House
of Commons social security
committee, which claimed it
would be “crazy" to exclude
Europe's growing unfunded
pensions liabilities from the
monetary union criteria.
But officials at the Trea-
Lord Healey, the former
Labour chancellor of the
exchequer, underlined the
party’s increasingly
sceptical stance over
European monetary union
on Wednesday by predicting
that a single currency would
cause street riots, David
Wighton writes.
He told the House of Lords
that it would be “a disaster
economically and politic-
ally” for Europe to go ahead
and that if the UK could not
persuade other countries to
delay it should stay out.
Lord Healey, then Mr Denis
Healey, was a Labour MP
from 1945 to 1992 and a
minister in the 1970s.
“The soda! strains created
by the fight between the
central bank and the
national governments to try
to return to the type of
convergence which was
originally intended will
produce riots on the streets,
as they already have in
France, and certainly
demonstrations, as they are
doing now in Germany,” he
said.
sury, where Mr Clarke is the
senior minister, said there
was no substance to the
report, arguing that EU
states “have started to take
at least some action” to deal
with long-term liabilities
from their unfunded
schemes.
The committee's report,
entitled Unfunded Pensions
Liabilities m the European
Union, argued that France
and Germany would face a
crippling fiscal burden in the
next century because of
their reliance on pay-as-you
go schemes. By contrast it
claims the UK is in a far
stronger position because it
has more pension assets
invested in private sector
schemes than the rest of
Europe put together.
The committee argues that
the UK would be “at risk"
from the levels of pension
debt in Europe if it joined a
single currency.
As an example of the
kinds of liabilities the UK
might be exposed to, the
committee said the UK's
total national debt — includ-
ing unfunded pension liabili-
ties — was currently equiva-
lent to £9.000 per person.
This would increase to an
average of £30,000 of debt if
total EU liabilities were
shared among all member
states. However, the Trea-
sury argued that the UK was
protected by several aspects
of the Maastricht treaty.
It emerged yesterday that
a leading economic adviser
to the European Commission
was set to raise concerns
about the economic pres-
sures from public sector pen-
sion schemes across Europe.
In a paper that will be pub-
lished shortly, Mr Daniele
Franco, economic adviser in
the Commission's director-
ate general for economic and
financial affairs (DGU),
argues that the scale of
unfunded liabilities will
mean that “in the first
decade of the next century
the outlook for the pension
system gets worse”.
UK NEWS DIGEST
Export credits
agency recovers
The Export Credits Guarantee Department has completed
its recovery from more than a decade of serious financial
difficulties caused by the Third World debt crisis, the
head of the government-owned trade finance agency said
yesterday.
Mr Brian Willott, chief executive, said a buoyant operat-
ing performance and an improvement in the department s
cash flow in the year to March 31 had enabled it to make
a £246 tn ($400. 98m) cash payment to the Treasury.
The last time the ECGD contributed to the exchequer
was in 1983. It then operated In deficit before achieving
break-even in 1993-1994. Last year's payment is believed to
be the largest ever, although the ECGD said changes in
Its operations made direct comparisons with previous
years difficult.
The ECGD said its trading surplus on new insurance
business written wnw 1991 rose to £103 in the last
financial year from £60m. Premium income increased to
£156J>m from £U2J5m. while claims paid fell to £294. 7m
from £42 1m.
Guarantees issued for new business rose 35 per cent to
£4.08bn, twice the average annual level for the previous
decade. The figure was boosted by cover for exports of
Airbus commercial aircraft and large power station pro-
jects in fihiTia and the Philippines. China was by for the
biggest market for new business. Guy de Janqui&res
■ CORPORATE GOVERNANCE
Two-tier German boards rejected
The Confederation of British Industry, the country's big-
gest employers' lobby, yesterday rejected suggestions
from the opposition Labour party that economic “stake-
holders" such as employees, customers and suppliers
should be represented in company boardrooms.
In a report prepared for the corporate governance com-
mittee chaired by Sir Ronald Hampel, the CBI acknowl-
edged that the UK’s traditional unitary board system was
under attack following public arguments over directors’
pay and the role of non-executive directors in supervising
executive directors.
However, the CBI said that the answer to these con-
cerns did not lie in opening boardrooms to representatives
of stakeholders or accommodating stakeholders by creat-
ing German-style two-tier boards. Stefan Wagstyl
m PENSIONS
Mis-seliing leak investigated
The Personal Investment Authority, the City of London
watchdog, has launched an inquiry into a leak of figures
showing the slow pace of efforts to compensate people
who were mis -sold personal pensions. It plans to appoint
“an independent person of stature” to conduct the probe.
The figures, printed in the Independent newspaper in
London this week, showed that 26 of the country's loading
pension providers had assessed only 9.100 of more than
360,000 priority cases.
The review into pensions mis -selling was launched by
the Securities and Investments Board, the chief city
watchdog, in 1994 when up to 1m potential cases were
identified. Christopher Broum-Humes
■ INTERNET
Servicing companies 9 growth falls
The rapid expansion in the number of companies set up to
take advantage of the Internet in the UK has fallen off in
the past six months, according to a continuing survey of
the global network. There are now 630 British companies
Wire services -
When companies started providing Internet access & services
In theUK airetand . .
■ Aec—a— wfloa j -; |
- Oct
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I- -
. O . . -. ,40.. . 13® . .180 BOO
Ai^3MJ3anitaoB Nurob«rot coaiparda*
listed by ArcGlade Services in their “inetuk" list, of
which 61 per cent are involved in designing Net services
for other companies. The rest base their business on link-
ing individuals and companies to the Net, although many
now cover both the “access” and “services" sides of the
sector. James Mackintosh
■ INWARD INVESTMENT
Toyo Seals leases factory
Toyo Seal Industries of Japan is making its first overseas
manufacturing investment with a £2. 4m <$3.91m) project
in north Wales. The company, which makes rubber seals
for automotive bearings, considered other sites in the UK
and mai n la n d Europe before deciding to lease a factory at
Wrexham in north Wales from the Welsh Development
Agency. The project is grant aided by the British govern-
ment’s Welsh Office.
In a separate inward investment, Conti co International
of the US is setting up a company in Cornwall, south-west
Engl a n d, to assemble plastic spray heads, used for domes-
tic cl eanin g and insecticides. The subsidiary, Continental
Sprayers, is expected to create at least 60 jobs in a £5.ixn
investment at Redruth. The Department of Trade & Indus-
try is providing £840,000 of grant aid.
Rolcaid Adburgham, Cardiff
COMPANY SALE
Rolls-Royce in negotiations
Rolls-Royce will today issue a statutory protective redun-
dancy notice relating to all the 1,700 employees of its Par-
sons Power Generation Systems offshoot, which was
offered for sale in July. Rolls-Royce, which is continuing
its efforts to sell Parsons, says it is optimistic of a sale. A
couple of potential purchasers, whose identity hsq not
been disclosed, have signed confidentiality clauses and
are carrying out due diligence. Chris Tighe
US team fails to prove electricity allegations
By Simon Hot barton tn London
Britain's electricity industry will
take comfort from the most com-
prehensive survey of research into
the effects on human health of
electromagnetic fields (EMFs)
which has concluded there is no
clear, convincing evidence that
exposure to them harms health.
More than 500 studies published
over the past 17 years were exam-
ined by a committee of the US
National Research Council, a body
funded by Congress.
At the release of the committee's
report In Washington yesterday,
Professor Charles Stevens, chair-
man of the committee, said:
“Research has not shown any con-
vincing way that EMFs common in
homes can cause health problems,
and extensive laboratory tests have
not shown that EMFs can damage
the cell in a way that is harmful to
human health.”
All electrical appliances emit
EMFs, as do above and below-
ground power lines. Since a 1979
study implicated EMFs in an
above-average incidence of child-
hood leukaemia, electricity compa-
nies have been sensitive to the
financial consequences of public
liability suits.
Companies have sought to pro-
tect themselves from civil suits by
taking out special Insurance
schemes to help them fight court
cases. Eight regional electricity
companies in Britain are investiga-
ting the establishment of an off-
shore mutual Insurance fund.
An epidemiological study of
childhood cancer is being under-
taken by the UK co-ordinating
committee on cancer research.
This may go some of the way to
resolving the questions that con-
tinue to linger after nearly 20 years
of research.
Although Professor Stevens'
committee found no experiments
on cells, and animals, or studies of
humans showing EMFs as being
carcinogenic. It concluded that
there was an as yet unexplained
“association” between EMFs and a
higher than normal incidence of
childhood leukaemia.
It said that the association
between residential proximity to
high voltage transmission lines
and increased rates of childhood
leukaemia remained unexplained.
High voltage transmission lines
were associated with a
“statistically significant" lVi fold
excess of childhood leukaemia
cases.
“However, the inconsistency of
results and the lack of a positive
association when spot
measurements are used remain an
e nigm a." the resport says.
6
9
FINANCIAL TIMES
FRIDAY NOVEMBER 1 1996
r " r 'li|!lW
■ Z
r iNANClAl times survey
JORDAN
Peace crisis
crushes hopes
Unless the Israeli leader rhangao
course, the kingdom’s dream of being
the economic hub of the Middle feist
may prove impossible to f ulfil
David Gardner explains why
Just one year ago. King
Hussein of Jordan opened
the second Middle East eco-
nomic summit in Amman,
intended to demonstrate that
the long Arab-Israeli conflict
had given way to peace,
cross-border business
regional Integration - and to
entice investors into
choosing Jordan as their
Middle Eastern base.
Only days later, prime
minister Yitzhak Rabin of
Israel was by a
Jewish extremist, triggering
a chain of events that led to
May’s election of Mr Benja-
min Netanyahu at the head
of a hardline Israeli coali-
tion. The regional peace pro-
cess has «inra ground to a
halt, and the much-touted
Israel-Jordan-Palestlne “tri-
angle’* of development, sold
to Jordanians as the King-
dom's ticket to a middle-in-
come economy, is nowhere
In sight
King Hussein, the Arab
leader who went furthest in
building bridges towards
Israel, has since May looked
perilously out on a limb, as
exposed as at any tima in his
bumpy 44-year reign.
In August a more than
doubling of bread prices as
part of an International Mon-
etary Fund-sponsored pro-
gramme to cut the budget
deficit and deepen structural
reform of the economy
sparked a revolt, which
^ % iT./M* 1 ! - - Jordan's prime mtntetor, Kabartti: ha* had to face domestic unrest
quickly spread from the old
Crusader stronghold of
Karak through southern Jor-
dan to the poor suburbs of
the capital. Amman.
Just as in similarly fierce
rioting after an IMF-backed
fuel price rise in 1388, it was
the Bedouin tribes and eth-
nic “East Bank** Jordanians
- not the majority Palestin-
ian community In the king-
dom, traditionally seen as
the greatest security worry -
who rose in Ire. The Bedouin
army and Intelligence ser-
vices, alongside an adminis-
tration sprinkled with Pales-
tinian technocrats but
dominated by tribal gran-
dees, are the pillars of the
monarchy.
It was also the East Bank-
ers who took most exception
to King Hussein’s emotional
speech at Mr Babin’s funeral
last year. Hostility to Jor-
dan's 1994 peace treaty with
Israel is widespread, and has
deepened as the “peace divi-
dends” rashly promised by
the government have failed
to appear.
Unlike Egypt, which has
had more than $40bn in
mainly US aid since gi grving
its peace treaty with Israel
in 1379, Jordan has received
a writeoff of barely gibn of
its foreign debt, which, at
4&2bn, still nearly equals its
grass domestic product At
the Amman summit a year
ago. Jordan had high hopes
of attracting investment of
up to $&5bn. much of it to
develop assets shared with
its peace partners, such as
the water, energy, •mrnpraic,
land, ports and tourism
potential of the Jordan Rift
Valley and Gulf of Aqaba.
Hard though Jordan has
worked, virtually none of
this ham materialised.
After the near collapse of
its economy and finances at
the end of the 1980s, Jordan
successfully stabilised - its
macroeconomy, and until
last year managed non-infla-
tionary growth averaging
1905
1096*
Total GDP. namtnN (JD Won)
4JS2
5.12
Real GDP growth (annual % change)
6.4
4.1
1 GDP per head (S)
1.561
1,053
Consumer prices [annual sv. % change)
2.3
6.4
Industrie] output (annual % change)
5,1
-1 a
Agricultural output (annual % change)
44)
4.9
Sendees output (anrual % change)
5.1
73
Money supply. M2 (anrual % change]
7.6
7 .0
Foreign debt (Sm)
7.129
7,000
Debt sendee (9fi of exports)
14.4
14.7
Current account balance &enj
-221
-279
Merchandise exports (Sm)
1,776
1,950
MwchantMae unperta (Sm)
-&297
-3452B
Merchandise trade balance ($m)
-1,521
-1,578
* toreent
■ Aims 91,800 mj km
■ Poputatkwc^-Sm
■ Currency: Jordanian Dinar JJD)
Bate: Oct IS. 1986 SlmSOOTlT
■ Main town* and poptSatfon:
Matraq 102,000
flamths 784X0
A0W 73.000
Madaba 704)00
Amman 1,231,000
Zarqa . 9854X0
IrbiCS ' 373.000
So* . 1874X0
Arabic; EngBrti la widely
spokan.
Sources: EJU; Datestreafn
around 6 per cent of GDP. It
moved quickly on to struc-
tural reform, putting in
place investor-friendly laws
and reforming capital mar-
kets. starting privatisation,
and signalling its intention
to become internationally
competitive by negotiating a
partnership agreement with
the European Union and
membership of the World
Trade Organisation.
But reform, coincident
with an unpopular peace,
has also brought hardship to
a fast-growing population,
widening the gap between
rich and poor, and badly hit-
ting the middle classes, the
social bedrock of Jordanian
stability. According to Mr
Mufleh Akel, a senior execu-
tive at the leading Arab
R ank, while official figures
show an increase in per cap-
ita income over the past
three years of 6 per cent, pri-
vate consumption has fallen
13 per cent in the same
period, and a quarter of the
population remains below
National legisistiira: bicameral Motional
Assembly; Senate of 40 members appointed by
the king. Under the constitution, sena tors ere
selected from prominent political and public
figures. Directly elected Chamber of Deputise of
80 members.
Electoral system: direct universal suffrage
Next election due: November 1997
National government: Council of Ministers
headed by the prime minister, appointed by the
king; ministers appointed by the king on the
advice of the prime minister. The Council of
Ministers is responsible to the Chamber of
Deputies.
. Head of state:
1 Mng Hussein Mm TatM
Prime mi nister, foreign
and defence minister
Abdet-Karfm al-Kebarttl
Speaker of the Senate;
Ahmad Lead
Speaker of the National
Assembly:
Seed Hayel Soraur
Main poBtical parties: Jordanian National
Alliance; Popular Unity Party; Future Party,
Unionist Arab Democratic Party; Islamic Action
Front; and pan- Arab nationalist, Baatfitet and
Communist parties.
the poverty hue.
Yet while it was buoyed by
the peace process, Jordan
could plausibly aim at
becoming a prosperous
regional base for investment
and production. “We started
seeing ourselves as a cata-
lyst that could activate
t.iirng K around us.” says Mr
Taleb Rifa’i, head of the
Investment Promotion Cor-
poration. the new “one-stop-
shop” for foreign investors,
“a bridge between the Arabs
and Israel, and a processing
centre far money, goods and
services’*.
The pressure for Jordan to
reorient its foreign and trade
relations was and remains
strong. The progressive clos-
ing off of Iraq, traditionally
Jordan’s largest market, as a
result of UN sanctions fol-
lowing President Saddam
Hussein's 1990 invasion of
Kuwait, and the very slow
recovery of exports to the
Gulf, where Jordan was until
recently unwelcome because
it stood aside from foe US-
led alliance that evicted Iraq
in 1991, means Jordan has a
more pressing economic
interest in peace than many
of its Arab neighbours.
This may partly explain
why King Hussein took
greater risks in arguing that
the Arabs should give Mr
Netanyahu more time, even
though the Israeli leader
rejected from the outset
retu rnin g more conquered
Arab land in exchange far
peace, and has ruled out a
Palestinian state on the (for-
merly Jordanian) West Bank
with occupied Arab east
Jerusalem as its capital At
June's Arab summit in
Cairo, the first since the Gulf
crisis, Jordan resisted Syri-
an-led demands for an imme-
diate end to diplomatic and
commercial ties with Israel.
But September's ferocious
fighting between Israeli
troops and Palestinian
policemen across the Jordan
river on the West Rank , the
result of Mr Netanyahu's
failure to implement even
the Interim self-rule agree-
ment the Palestinians
reached last year with Mr
Rabin, seems to have forced
the king to rethink.
He was criticised for
attending last month's emer-
gency summit between Mr
Netanyahu and the Palestin-
ian leader Yassir Arafat in
Washington - whereas Presi-
dent Hosni Mubarak of
Egypt garnered Arab plau-
dits by staying away. But
the king used the occasion to
vent all the fury of a
spurned moderate on the
Israeli leader. American
leaks confirmed by the king
revealed that be had warned
Mr Netanyahu that his
extremism and warmonger-
ing could tip the region into
an abyss, and fatally under-
mine the peace camp in the
Arab world.
The precariousness of Jor-
dan's own position should
the peace process fail and
West Bank desperation spill
over the river, is underlined
by a former Jordanian prime
Friday November 1 1 996
minister. "With the [Septem-
ber] events in Palestine,” he
warns, “the frustration of
the Palestinian population
[in Jordan] is becoming
equal to that of the ‘East
Bankers'. That is very, very
dangerous.”
In an interview last month
the King himself warned
that the Egyptian and Jorda-
nian peace treaties with
Israel - the only secure
achievements of half a cen-
tury of peacemaking - “will
definitely be in question if
there isn’t a strict adherence
to all agreements", espe-
cially the Israeli -Palestinian
accords. “Without the peace
process," one cabinet minis-
ter says, “the [1994] treaty Is
just a piece of paper”.
The King followed this up
with his first visit to the
West Bank since Israel cap-
tured It from Jordan in the
1967 six-day war, going out
of his way to support Mr
Arafat and allay Palestinian
suspicions of Jordanian col-
lusion with Israel
At home, he has been
under pressure since the
riots to replace the reform-
ing government of prime
minister Abdel -Karim Kabar-
itl Some leading Jordanian
politicians sense be may cir-
cle the wagons with a broad-
based national and national-
ist coalition, perhaps includ-
ing the fundamentalist
Islamic Action Front, the
most cohesive opposition
group, which helped keep
the August events within
constitutional bounds.
Senior officials say the
hope Is that increased pres-
sure on Israel from Washing-
ton after next week's US
elections, combined with a
united Arab front led by
Israel's peace partners,
Egypt and Jordan, will trans-
late into internal pressure
on Mr Netanyahu to change
course - especially from
Israel’s internationally-
minded business commu-
nity. Unless that happens,
they believe, there Is little
prospect of the Middle East
fashioning a framework for
moving forward, and there-
fore little chance of Jordan
becoming an economic hub
for the region.
“You have to offer yourself
as a region," says a senior
official responsible for strat-
egy. “There is no alternative,
even if. as yet. we don't have
a region. These are very dif-
ficult times. It will happen,
but when is a question I can-
not answer.”
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10
FINANCIAL TIMES
FRIDAY NOVEMBER l 1996
II JORDAN: Politics and economics
Economy; by David Gardner
All dressed up with nowhere to go?
Netforeighifirtot inwestment.
$mffion
60 —
The success of
macroeconomic
reforms is diluted
by continued
regional strife
The election in May of Mr
Benjamin Netanyahu as
Israel's prime minister at the
head of a hardline coalition
opposed to retur ning con-
quered Arab land in
exchange for peace has
given Jordan's economy the
look of being all dressed up
with nowhere to go.
After near financial and
economic collapse at the end
of the 1980s, Jordan has suc-
cessfully stabilised its
macroeconomy. It has also
put in place in vest or -friendly
laws intended to create a
regional base for a Middle
Eastern market it expected
to expand and become inte-
grated as a result of the
peace process between the
Arabs and Israelis. But that
has not happened.
Partly as a consequence,
attendant restructuring
problems - such as the lift-
ing of bread subsidies that
convulsed the kingdom in
riots in August - and secu-
lar problems such as fast-
dwindling water resources,
which can only be solved
wit hin a regional accord,
look more Intractable.
Throughout the 1970s and
most of the 1980s, Jordan
prospered from the surge of
oil wealth from its Arab
neighbours, and by feeding
the undemanding Iraqi mar-
ket throughout the 1980-88
Iran- Iraq war. But then the
mld- 80 s oil price collapse,
draining off the flow of aid
and Jor danian remittances
from the Gulf, was followed
by the 1990-91 Gulf crisis.
This closed off Jordan’s big-
gest market in Iraq and iso-
lated the kingdom from the
Gulf, after Ring Hussein
refused to support the West-
ern -Arab coalition that
evicted Iraq from Kuwait.
Nevertheless, backed by
the International Monetary
Fund and the World Bank.
Jordan in 1990 launched a
thorough restructuring pro-
gramme. which until last
year yielded average annnai
growth in GDP of 6 per cent,
cut inflation from 16 to just
over 4 per cent, and slashed
the budget deficit from over
18 to around 5 per cent oF
GDP.
Beyond macroeconomic
stabilisation and the mainte-
nance of a strong anti con-
vertible dinar through high
Interest rates, the govern-
ment has cut corporate taxes
heavily, liberalised foreign
investment rules, consoli-
dated the banking sector and
reformed the securities mar-
External debt
as a % of GDP
200 —
ket, started down the road to
privatising state assets and
halved the weighted average
tariff to around 17 per cent.
By the end of this year, it
hopes to have sealed a part-
nership agreement with the
European Union, and has
already started negotiations
to join the World Trade
Organisation - the two
clearest signals of its wish to
be integrated with the inter-
national economy.
In mid-reform. Jordan
placed a big strategic bet -
signing its 1994 peace treaty
with Israel, and banking on
the emergence of a Jordan-
Israel -Palestine “triangle" of
cross-border economic inte-
gration, investment and
development,
High investment during
the fat years had developed
a small but solid manufac-
turing base, with big state-
dominated companies In pot-
ash, phosphates and fertilis-
ers, cement and refined oil
products, and smaller pri-
vate ones producing pharma-
ceuticals, detergents and
chemicals, footwear and tex-
tiles, and processed foods.
The fertiliser business has
internationalised through a
bold joint-venture policy
aimed at securing more
added value and long-term
markets. But to attract des-
perately needed investment
- from foreigners and Jor-
danians who hold an esti-
mated S6bn abroad — Jordan,
without the size of Egypt or
the riches of the Gulf, had to
expand from a s mall market
of 49m people to a base for
the region. The peace pro-
cess appeared to be the key.
"The peace process added
something unique to a strat-
egy to Integrate oar econ-
omy internationally," says
Mr Taleb Rlfa’i, director of
the Investment Promotion
Corporation, the govern-
ment's new “one-stop shop"
for foreign investors. “We
started seeing ourselves as a
bridge between the Arabs
and Israel, and a processing
centre for money, goods and
services.”
First-quarter direct Invest-
ment approvals of $300m.
about one fifth from abroad,
showed modest promise -
which quickly faded with
the Israeli election.
But hopes that the 1994
treaty would lift Jordan's
economy Into the middle
income bracket were not
materialising even before
the advent of Mr Netanyahu,
and his subsequent freeze on
the peace process with the
Pal tyHniana and Syria. "Eco-
nomic logic cannot be a sub-
stitute for political prog-
ress,” Mr Rifa’l ruefully
acknowledges.
Jordan received nothing
like the peace "dividend”
Egypt got for its 1979 treaty
with Israel, which still
amounts to nearly $4bn for-
eign aid a year and the near
halving of its foreign debt.
The kingdom instead got
modest sovereign debt write-
offs, mainly from the US and
UK, cutting the debt from
$8.4bn in 1991 to $6J!bn now.
That Is still roughly equiva-
lent to Jordan’s GDP and
this “overhang” Is putting
pressure on the current
account, at a time when Jor-
danian export options are fox
from dear.
The Palestinian West
Bank, let alone the much
bigger, more sophisticated
Israeli market, is all but
closed to Jordan for what
Israel Insists are security
reasons but Amman con-
strues as protection of a cap-
tive market. Jordanian
cement, for instance, when it
can get into the frequently
blockaded occupied territo-
ries. has to travel on a
"back-to-back” system,
unloading at the border and
reloading in the West Bank:
leaving Jordan at $46.50 a
ton. it arrives in Gaza at $91
a ton, erasing Jordan's com-
parative advantage against
Israeli suppliers.
But it is above all in Iraq,
which even after the Gulf
War was talcing ’ 20 per cent
of Jordanian exports, where
the pressure is becoming
acute. The indefinite post-
ponement of UN-sanctioned
**>l nm a ni ten-inn '* ofl sales tO
enable Iraq to buy food and
medicine has combined with
Jordan's decision nearly to
halve Its oU-for-goods barter
trade with Iraq. This. UN-
agreed, protocol allowed Jor-
dan to import $400m in Iraqi
oil at a discount, in
exchange for goods that
Amman paid Jordanian mer-
chants for supplying. In
practice, Jordanian export-
's were supplying for more
- leading to arrears on the
protocol of $iL3bn, officials
say. The government's deci-
sion to rein in this trade
means that total Jordanian
exports are now growing at
only io per cent, against
nearly 50 per cent In 1994-95.
All this has highlighted
once again the a Haiti Jor-
dan faces about where to
aim its goods - regionally or
internationally. Mr Mofleh
Akel. senior credit mana ger
at Arab Bank. Jordan's lead-
ing bank, says "the Iraqi
market is a strategic market
for us. and we can't easily
replace it”, adding that,
"with exceptions like fertil-
iser, to go regional Is more
practical”.
Mr Riad Fariz. the new
governor of the central bank,
by contrast detects the
beginnings of "a structural
shift towards more demand-
ing markets”, with exports
- -
... .-me ... 91
SauKMK ja aaBU Otti W m- '
to Europe, for instance, up
fivefold since 1991. “My view
is that with globalisation, if
we cannot compete Interna-
tionally then we cannot com-
pete regionally.” he says.
Tbe central bank has come
under attack for maintaining
high Interest rates - cur-
rently ranging between 13
and 14 per cent against infla-
tion of 4 to 5 per cent if the
one-off effect or the bread
price rises is discounted. Yet
these rates are a vital hook
for remittances and repatri-
ated capital - running at
JD504m in the first half of
thi«! year against JD797m all
last year, or JD265xn in 1991
- one of the kingdom's three
main sources of income
along with tourism and fer-
tiliser exports. Mr Fariz also
intends to deter dollar specu-
lators. While there is virtu-
ally no dinar liquidity, the
banks hold around $3bn in
dollar deposits and the gov-
ernor Is determined the price
of redemption will be high.
The policy diverts savings
into land and high-yield gov-
ernment instruments, but
Mr Fariz maintains that
investment is still high tat
over 30 per cent of GDP), and
points to central bank rate
rebates and dinar lines avail-
able to industrial investors.
“My top priority is to
maintain the stability and
credibility of our macroecon-
omy and vital to that is the
stability of the dinar.’* be
insists. "Without macro sta-
bility. there would be no
investment at all.”
Up for stale: the government’s prime privatisation candidates
At a time when the stalling- of the
peace process' has the Jordanians
worrying about where to find stable
export markets and where to get
investment to upgrade their
economy , the sale of state assets
looks the best hook both for foreign
investors and an estimated $6bn in
Jordanian capital held abroad.
The gover nment , after off
a. number of hotels, has. yet to
devise a rounded strategy. After
August's revolt againstTMF-backed
bread price rises, itlsalso conscious
that privatisation should not be
seen to widen the growing income
gap between rich and poor, and
should serve to bolster the
hard-pressed middle classes. In
principle, therefore, future buyers
and private operators will be
required to keep at least 25 per cent
of their equity in the market to
broaden the base of ownership. The
placement of shares with company .
employees is being studied, and
proceeds from the sales will partly
go towards social safety nets
ranging from housing to pensions.
Among thestate assets being
reviewed for private sale are:
'• TelMwmniimifaHnng Company
The TCC monopoly ends in 1998,
and private mobile telephone
operators already have 8 per cent of
the market. Last month, it was
turned into .a stockholding company
capvtahsed at JBSBGm. The
government is seeking a strategic
partner for 26 per cent of TCC. with
the rest offered on the stock market.
• Jordan Electricity. Authority
JEA was converted into a
stockholding company in
September. The government is
poised to invite tenders for
independent power generation - :
projects prior to privatisation.
e> Water and transport
. The government wfll. privatise the : .
Aqaba Railway Corporation and .
public bus companies and will '
invite private investment in
transport and water projects.
' • Jordan Cement Factories
The state owns 49& pet cent oC
Jordan Cement and is kxdung for a
strategic partner from at least six
applicants, among them Lafarge of
France and Holderbank of
Switzerland.
• Arab Potash Company (APQ
and Jordan Phosphate Mines
Company (JPMC)
The state holds 55.3 per cent and
42.4 per cent in APC and JPMC
respectively. No decision on these
highly profitable and strategic
assets, has as yet been made, partly
because of the pan-Arab
shareholding structure, but officials
say “they will be studied”.
M Politics: by David Gardner
Storms at the ‘oasis’
M Relations with Israels by Judy Dempsey _
Fences may not mend
Recent events
have raised
doubts about the
king's system of
government
About a year ago. King
Hussein returned to Jordan
to find that his then prime
minister had erected a mon-
umental statue to him out-
side his office - built in
North Korea and with Ozy-
mandias dimensions to
match. The King, himself a
subtle man, politely thanked
him, but ordered its immedi-
ate removal.
But if he thought that arti-
fact might seem provocative,
its swift replacement by an
obscure monument resem-
bling a sheaf of wheat is
unbeatable for its poor tim-
ing. For the new prime min-
ister. Mr • Abdel-Karim
Kabarlti. and the Hashemite
monarchy he serves, in
August had to face down a
revolt against a more than
doubling of bread and wheat
prices implemented as part
of an IMF-backed restructur-
ing programme.
The rioting forced the
King to suspend parliament
and send in elite units of his
army. It was tbe biggest
domestic challenge the
regime had faced since simi-
lar riots in 1989 against IMF-
agreed fuel price rises.
Just like then, it was not
citizens of Palestinian origin.
- easily 60 per cent of the
43m population and seen as
the country’s most serious
security concern since the
1970-71 civil war with the
Palestine Liberation Organi-
sation - who rose in revolt.
It was the ethnic or “East
Bank” Jordanians of Bed-
ouin origin, the bedrock of
the king’s army and admin-
istration.
The king quickly brought
the situation under controL
Few, in or outside Jordan,
took seriously his claim that
Iraqi agents were behind the
unrest. The origins of the
discontent are domestic.
Put simply, Jordanians
were promised that the
deeply unpopular 1994 peace
with Israel would raise
incomes, whereas it has
failed to deliver any "peace
dividends”. Although gov-
ernment cutbacks and struc-
tural economic reform would
have had to happen anyway
following near economic col-
lapse at the end of the 1980s,
the ensuing hardship and
widening of tbe gap between
rich and poor is associated
with the king's enthusiasm
for closer links with Israel,
and his volte-face last year
on Iraq, after refusing to join
the US-led alliance against
President Saddam Hussein's
1990 invasion of Kuwait.
To keep peace with Israel,
moreover, the authorities
have had to tighten their
grip on the "guided democ-
racy" that the King has
touted as a model for the
region. This democratic
experiment, with an elected
parliament including the
fundamentalists of the pan-
Islamlc Moslem Brother-
hood, still makes Jordan an
oasis of liberalism in a des-
ert of dictators and despots.
But it is under heavy pres-
sure, especially with the
peace process now at a halt.
The ferocious fighting in
September on the West Bank
between Israeli troops and
Palestinian security forces is
still reverberating through
the kingdom. It prompted
tbe King - the Arab leader
who has done most to build
bridges towards Israel - to
warn that the extremism of
the government of Mr Benja-
min Netanyahu could tip tbe
region into disaster.
“With the events in Pales-
tine.” warns a former Jorda-
nian prime minister, “the
frustration of tbe Palestinian
population [in Jordan] Is
becoming equal to that of
the ‘east bankers'. That is
very, very dangerous.”
But, for the moment, the
system has shown its resil-
ience.
August's discontent ini-
tially crystallised around the
Brotherhood's Islamic
Action Front (IAF). The IAF
became the biggest party -
with 34 of 80 seats - when
the King responded to the
1989 riots by restoring parlia-
ment, dissolved in 1957 after
pan-Arab nationalist agita-
tion. In the 1993 elections,
the IAF was whittled down
to 16 seats, as the regime
nervously changed voting
procedures to ensure more
loyalist tribal grandees were
elected.
But after the August
events, the King appears to
have recognised that the IAF
- which grouped around it
just over half Jordan's frag-
mented political spectrum In
a call for Mr Eabarrti's resig-
nation - was a factor in the
system’s resilience, a loyal
apposition that helped keep
the outbreak within manage-
able bounds. .
Subsequently, in the face
of Israeli obduracy towards
the Palestinians, King Hus-
sein has been strident in his
criticism of Mr Netanyahu,
often foreshadowed in his
remarks by Crown Prince
Hassan, his younger brother
and heir to the throne.
All of this taken together
has led Amman’s rumour-
driven political salons to
expect a change of govern-
ment.
After the 1989 riots, the
King Immediately dismissed
his then premier. This time,
however, he has stood firmly
by Mr Kabarlti. The ambi-
tious prime minister is
closely associated with the
turn towards Israel and
away from Iraq, and is carry-
ing out an economic reform
policy to which the regime is
firmly committed. But one
function of the premiership,
within a political elite that
rotates frequently, is as
li ghtning 1 rod for tfw monar-
chy. “Most of the criticism of
Kabarlti is in fact directed at
the King." observes one lead-
ing politician.
He, and others like him.
believe the King will dis-
pense with Mr Kabariti and
seek a new, “more national
and nationalist” administra-
tion. possibly with more Pal-
estinian- Jordanians In its
ranks. While few such sce-
narios are without self inter-
est, they at least have ample
precedent to draw an. And
King Hussein will need more
than his Bedouin troops and
Intelligence services to bat-
ten down the hatches
against the storms ahead.
It seems the
accord between
the kingdom and
Israeli leaders
died with Rabin
When Mr Benjamin
Netanyahu was elected
prime minister of Israel last
May. Jordanian officials
chose their words carefully.
Unlike the other Arab states,
which viewed Mr Netanay-
hu’s election with more than
trepidation, believing the
peace process begun five
years earlier at Madrid was
in jeopardy. Jordan pre-
ferred to wait
"We wanted to give Netan-
yahu the benefit of the
doubt,” one senior Jordanian
official explains. “Until then,
we bad high expectations -
perhaps too high - about the
peace process.”
That those expectations
were not justified seems to
have been confirmed in
recent months by the break-
down of Jordan’s special
relationship with the Israeli
government.
Over the years, King Hus-
sein of Jordan forged a par-
ticularly close relationship
with Mr Yitzhak Rabin, the
former Labour prime minis-
ter assassinated by a far-
right wing Jew a year ago.
“We honestly felt he under-
stood not only our needs but,
more importantly, the Arab
world," a Jordanian official
says.
Even though Egypt was
the first Arab country to
sign a peace agreement with
Israel back In 1979. Jordan's
links with Israel were in fact
closer, culminating in a
peace trgbty in 1994. Jor-
dan’s borders were opened:
trade improved. And
although there were many
outstanding issues to be
resolved - most notably the
future status of Jerusalem —
Jordan felt it had a reliable
partner in Mr Rabin. His
death, and the subsequent
election of Mr Netanyahu,
created a vacuum in rela-
tions between Jordan and
Israel. It is one that Mr
Netanyahu's conservative
Likud-led coalition seems
unable to fill.
Two examples serve to
illustrate the deterioration of
trust. Just days before Mr
Netanyahu announced his
decision to expand the Jew-
ish settlements in the West
Bank last September, Mr
Do re Gold, one of Mr Netan-
yahu'S closest advisers, vis-
ited King Hussein to discuss
the slow pace of the peace
process. Not a word was said
about the settlements. The
day after Mr Gold returned
to Jerusalem, the settlement
decision was announced. A
few weeks later, Mr Gold
returned to Amman hut did
not tell King Hussein of Mr
Netanyahu’s decision to
open a tunnel exit close to
the Al-Aqsa Mosque in Jeru-
salem. The next day, the
tunnel was opened, a move
that sparked off violent dem-
onstrations and fighting
between Israeli and Palestin-
ian forces.
Jordanian officials, who in
the past conveyed their opin-
ions on any sensitive issues
through diplomatic chan-
nels, this time chose to criti-
cise the Netanyahu govern-
ment publicly. The fact that
Israel dismissed - initially -
such criticism, was, accord-
ing to Jordanian officials,
indicative of the way the
Likud government perceived
Jordan and the Arab world.
“Likud is not sensitive to
Arab needs or Jordan's,” a
Jordanian official said.
“Rabin understood them."
Those needs are consider-
able. The peace process is
not only about legitimating
Palestinian self-rule, or the
establishment of a civil soci-
ety and administration in
the West Bank and Gaza, or
the development of a new
security architecture in the
Middle East: for the Jordan-
ians. it is the tool that wil]
help resolve a complex range
of issues.
These issues include the
fate of Palestinian refugees
in Jordan, the kingdom's sta-
tus in relation to the Holy
sites in Jerusalem and its
relations with the West
Bank. And since 70 per cent
of Jordan’s population is Pal-
estinian, Amman can ill -af-
ford to have unstable rela-
tions with either the
Palestinians in the West
Bank, who are far from
united in their policies
towards Jordan, or Israel.
Yet the way the Netan-
yahu government has con-
ducted foreign policy with
Jordan and the Arab states
has. Ironically, galvanised
the Arab world against
Likud. And, regardless of the
gap between rhetoric and
substance, it has brought it
closer to Mr Arafat, the pres-
ident of the Palestinian
Authority who, over the
years, has had a difficult
relationship with his Arab
Idn-
Last month, King Hussein
made a visit to the West
Bank town of Jericho - his
first since 1967 - as a show
of solidarity to the fledgling
Palestinian state and as a
demonstration of his anger
with Mr Netanyahu.
Since that visit, it has
been left up to Mr Ezer Welz-
man, the president of Israel,
who himself has been out-
spoken about the Netanyahu
government and the danger-
ously slow pace of the peace
process, to try to mend
fences with Amman. But for
Jordanian officials, bringing
relations between Israel and
Jordan back on an even keel
depends precisely on the
peace negotiations yielding
results. The omens, so far,
are not good.
lit S ( 1 r i ; : Nor To Mi^ This Un'IOUK Markf i inc, Oitorti. ni i y
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FINANCIAL times
1 1
JORDAN: Finance and industry III
Banking; by Alexandra Capoiio
Fiscal tightening
and consolidation
of its sector
dominate Central
Bank thinking
Jordan's Central Bank
continues to be committed to
its tight monetary policy,
aimed at keeping the lid on
inflation, unofficially esti-
mated at 6 to 7 per cent,
increasing' domestic savings
and protecting the Jordanian
dinar against “dollarisa-
tion".
While the strategy seems
to. have been successful,
bankers say ail-time hi gh
interest rates have affected
investment and growth.
A senior Central Bank offi-
cial concedes that economic
growth has been affected but
says that lack of demand for
the dinar means there is no
alternative to maintaining
the policy.
The CBJ is determined to
strengthen faith, in the dinar
after the crisis of 1989, which
led to a 45 per cent devalua-
tion of the currency — a
memory still painfully pres-
ent for most Jordanians.
Despite lending rates of
around 13-16 per cent and
deposit rates hovering
line on tough policy
Tourism; by Alexandra Capelle
around 9 per cent, some 40
per cent of bank deposits -
or about $3bn - are still held
in foreign currency.
Although growth in dollar
deposits is not as strong as
in recent years, hitting only
3 -8 Per cent in the first eight
months of 1996. compared
with the same period last
year, growth in dinar depos-
its - 2L4 per cent - remains
lower in comparison.
A 5 per cent margin
between US dollar and dinar
deposit rates is designed to
discourage dollarisation.
"Our policies are supposed
to be a guarantee to the
investor and credibility is
increasing," says the Central
Bank governor, Mr Zyad
Fariz. “But if they want to
keep their dollars, let them
pay the price."
At the same time, the CBJ
is still struggling to build
sufficient foreign reserves to
comply with International
Monetary Fund require-
ments. Whereas cash
reserves this year (SSSOm to
$600m) ■ are worth two
months of merchandise
imports and are close to the
1996 IMF target, in the long-
run Jordan needs to raise
them to levels worth three
months of merchandise
imports ($900m).
The CBJ monetary policy
does appear to have suc-
ceeded in controlling credit
expansion - without regula-
tory limits since 1993 -
through its interest rate pol-
icy. It projects that credit
granted by banks should this
year be significantly lower
than in 1995. In the first nine
months of 1996 bank lending
Increased JD23Tm compared
with an increase of JD457m
for the whole of last year.
High rates of 9.5 per cent
offered by the CBJ on certifi-
cates of deposits have dried
up large amounts of Jordan’s
cash liquidity. “A lot of
banks are seriously short of
dinars, which has pushed op
rates for months." a foreign
banker says.
Mainly responsible for a
rise in total net profits in the
banking sector hum JDlOOm
in 1994 to JD122m last year
were the larger commercial
banks, such as Arab Rank
and Housing Bank, which
saw profit increases of
JDiOm and JD4.5m respec-
tively. In contrast, smaller
investment banks generally
stated flat profits or losses.
Last year’s chief objective
for the Central Bank was the
consolidation of the frag-
mented banking sector -
made up of 21 foreign and
commercial hanks with more
than 400 branches.
To encourage mergers,
minimum capital require-
ments were raised from
JD5m to JD20m. The new
mi nimum was supposed to
be effective from the end of
this year. but. in view of dif-
ficulties emerging for many
banks, an extension until
mid- 1997 has been granted to
those already bolding capital
of JD15m and more.
Three of the smaller banks
look unable to raise capital
to JDl5m by the end of this
year and could consequently
face penalties from the Cen-
tral Bank. To avoid such a
scenario, Philadelphia
Investment Bank is cur-
rently looking for a partner.
Similarly. Amman Invest-
ment Bank might soon agree
to a takeover by Arab Bank.
So far, only one merger
has materialised. The union
of Jordan National Bank and
the Business Bank has cre-
ated Jordan's third largest
h ank. With capital of JD22m.
the new concern, which will
operate under the name of
the Jordan National Bank,
will rank only behind Arab
Bank (JD44m) and Housing '
Bank (JD25m).
The Central Bank is also
keen to develop private capi-
tal markets by combining
the still separated commer-
cial and investment banking
into comprehensive institu-
tions. Specialised credit
institutions, such as Indus-
trial Development Bank and
Housing Bank, are to be
integrated into the commer-
cial banking sector. This
should make them less
dependent on external finan-
cing and subsidies.
In the longer term,
another problem facing the
CBJ, says Mr Fariz, is the
possibility of a separate Pal-
estinian currency. The sub-
sequent pressure of the
redemption process is expec-
ted to increase speculation
against t he Jordanian dinar:
the Palestinian West Bank
currently holds an estimated
$L2bn In deposits, of which
42 per cent are in dinars -
nearly a third of overall
dinar circulation.
As a defence against dinar
redemption, a $300m fund
has been established by the
CBJ. But. according to one
banker, “economically, polit-
ically and practically the
Palestinian currency does
not pose an immediate
threat as it will need some
time to gain credibility and
become an alternative to the
Jordanian dinar".
The Stock Exchange; by Alexandra Capelle
Sure but silent revolution
The reforms
needed to attract
foreign capital are
being made -
albeit quietly
The Amm an Financial
Market — Jordan's stock
exchange - is having
another disappointing year,
crushing investors’ hopes
that last year's Middle East
Economic summit in Jordan
would fuel an equity invest-
ment boom.
Late implementation of
reforms and new regula-
tions, continued regional
instability, record-high inter-
est rates and shaken market
confidence have put tremen-
dous pressure on prices
throughout the last nine
months. However, the clouds
could be lifting. The king-
dom is increasing its deter-
mination to speed up market
liberalisation following.
International Monetary
Fund adjustment guidelines
and a radical restructuring
of the stock market is part of
the package.
The Amman Financial
Market has been missin g out
an foreign capital flows into
the Middle East, with a fore-
cast of a mere $25m in total
annual foreign flows thi s
year, compared with an esti-
mated S700m for Egypt.
The AFM general index
fell from 159.2 at the close of
1995 to a three-year low of
136-8 in July 1996 and is cur-
rently hovering around the
146 mark. Annual turnover
fell further from JD495m in
1994 to JD419m last year,
with turnover for the last 10
months at JDl70m, a drop of
52 per cent compared with
the same period last year.
Record-high interest rates
of up to 16 per cent have
been holding the stock mar-
ket hostage, squeezing
liquidity as investors spurn
shares for bank deposits,
treasury bills and real
estate. A significant rise in
corporate profits, expected to
increase by 28 per cent in
1996 according to the AFM,
is mainly due to rising prof-
its In construction, industry
and mining , which are doing
significantly better than
other sectors.
A low free float of shares
makes much needed foreign
investments difficult, with
attractive listed companies
such as Arab Bank - respon-
sible for a third of market
capitalisation - having
already reached the foreign
ownership ceiling of 50 per
cent. - Other big Buccess sto-
ries. such as Housing Bank.
Arab Potash Company and
Jordanian Phosphate Mines
Company, have minimal
free-float capacities left
“It means that foreigners
• are very restricted in terms
of what they can buy," says
Mr Angus Blair, head of Mid-
dle East and North Africa
Markets at ING Barings. _
Amm an Stock Exchange
1995
1996
Mergers and faster privati-
sation — which would help
Increase capital flows, give a
greater choice of available
stocks and allow for bigger
investments — are high up
on the lists of foreign inves-
tors demands.
Five leading privatisations
- among them the Telecom-
munications Company and
the Jordan Electric Author-
ity - are in the process of
implementation- this year.
Currently, the government is
inviting bids from foreign
cement companies for a key
holding In its Jordan Cement
Factories Company.
But this- year's figures
-show as yet little investment
response to the govern-
ment's efforts. Although Jor-
danian stocks are cheaper
this year than last, with the
average price/earnings ratio
currently at 14JJ, down from
16.5 last year, analysts say
'that corporate earnings are
still lower and the market
more expensive than many
other competing emerging
markets: ■ " *
Critical to any growth will
be a much faster implemen-
tation of reforms to liberal-
ise investment rules.
“People rai the ground see
a lot of movement but the
foreign investor’s attention
is diverted to neighbouring
countries," says Mr Omar
Masri, managing director of
Atlas Investment Group. “A
sort of silent revolution is
taking place in Jordan in
terms of the reforms - they
are finally happening.”
Mr Masri forecasts that it
will take a good three to six
months before foreign inves-
tors recognise the c han g e s.
The first measures aimp-d
at encouraging foreign
investment were taken in
late 1995. And earlier this'
year a new bylaw facilitating
foreign investment, an
investment law and a tax-
cutting law for local corpora-
tions were passed in an
effort to increase the
extremely low liquidity of
the market. Other laws
expected later this year
should provide further stim-
uli.
The response, however,
has so far disappointed. “In
terms of the expected inflow
of foreign investments, noth-
ing substantial happened,”
says Mr Mohamed Tash, gen-
eral manager of National
Securities, a subsidiary of
Jordan's Business Bank.
Apart from problems specific
to Jordan, Mr Tash blames
an ebb in the global cycle of
interest in emerging markets
for the lack of investments.
However, the most impor-
tant reform for the market is
yet to come. By the end of
this year, a new securities
law. designed to loosen the
state’s grip over the
exchange and to give faster
and clearer presentation of
company results as well as
computerise trading activi-
ties, will be implemented.
The government intends to
separate the AFM into a
watchdog “Securities
Ex c han ge Commission" and
the privately run “Amman
Stock Exchange".
Natural resources: by Alexandra Capelle
Support for
‘backbone’ of
the economy
Export composition*
Joint ventures
should guarantee
the continued
strength of the
minerals industry
Jordan's min erals industry,
the backbone of its economy.
Is set for steady expansion
as new Joint ventures, more
added- value from down-
stream production and
increased foreign interest
develop it further.
Jordan's most important
minerals — phosphates and
potash - are largely respon-
sible for the significant rise
in the country’s merchan-
dise exports from $lbn in
1993 to $1,771X0 in 1995 and
for an estimated sectoral
earnings growth of 44 per
cent this year.
The two main forces of the
industry - the Jordan Phos-
phate Mines Company
(JPMO and the Arab
Company <APC) - are trying
hardtofflPitalisetmmcpand-
ing- world demand. The two
companies are involved in
seven downstream pntfKbi
as well as their own plant
expansion
which should raise combined
annual upstream capacity to
12.1m tonnes by the end of
the millennium.
JPMC is the ^ds sec-
ond largest exporter of rock
phosphates (after
with 4.2m tonnes. It expects
a total revenue of 5340m to
«350m in 1996, compared
with 3323m last year.
The company is not produ-
cing at its fall 7m tonnes
capacity but, according to
JPMC’S managing director.
Mr Sameh Madani, growing
interest for Jordan's, environ-
ment-friendly phosphates
from Western Europe could
change that, with potential
new amniini orders of up to
' 1.5m tonnes.
Earnings this year were
boosted by a higher quantity
of sales and the rock phos-
phate price increase in 1995.
However, despite continu-
ously strong demand for the
raw ma terial, the company’s
strategy over the last years
has been to strengthen its
position by concentrating on
downstream activity.
“Due to the marketing sit-
uation. we realised that -we
couldn’t continue as sellers
of rock phosphates only, oth-
erwise we would be vulnera-
ble to any changes in the
world market so we decided
to go for diversification or
downstream," Mr Madani
says.
The company, which set
up its own. fertiliser complex
in Aqaba in- 1982, hopes to
ensure steady growth by
three downstream joint ven-
tures.
In December this year,
construction for a 220.000
tonnes phosphoric add plant
will he completed by the
Indo-Jordan Chemicals Com-
pany. The SITOm project will
export exclusively to India.
Phosphates. 13%
Potash 12%
Machinery &
transport
equipment 21 %
A similar project Is expec-
ted to start production at the
Nippon-Jordan Fertiliser
Company by mid-1997. The
$80m compound fertiliser
plant based near JFMC's
Aqaba plant will reserve its
300.000 tonnes mixed fertil-
iser production for the Japa-
nese consortium, which
owns 60 per cent of the ven-
ture.
Not yet finalised is a joint
venture project with Norsk
Hydro of Norway, which
intends to hold a majority
stake In a 440,000-tonne
phosphoric add plant at Shi-
diyeh and a fertiliser plant
at Aqaba. Investment costs
are estimated to be $400m.
Like JPMC, APC, Is find-
ing new strength. It
increased its net profits to
$60m last year and raised
output, sales and export
earnings to record levels. In
the first half of 1996. the
company's revenue rose by
10 per cent, and net profits
by 14 per cent compared
with the same period in 1995.
The positive results are
because of an 18 per cent
rise in sales prices and a 10
per cent Increase in sales
volume, boosted in particu-
lar by fast growing Asian
demand. Jordan is the
Chemicals 33%
world's sixth biggest potash
producer, with the Asian
market representing over 75
per cent of APCs total sales.
APC, like JPMC a listed
pan-Arab company with
majority stakes owned by
Jordan, bag reached its cur-
rent capacity maximum of
1.8m tonnes. Even though
prices and sales are up, the
end of 1996 should see the
same results, in net profits as
last year because of the
higher cost of fuel, electric-
ity and labour.
Apart from completing its
second expansion stage,
which will raise production
capacity to more than 2.lm
tonnes by 1999 in a $160m
investment, APC is busy pre-
paring to build an industrial
potash plant with a 100,000
tonnes -per-y ear capacity.
Contracts for the $9m plant
were earlier this year
awarded to Mannesmann
and Messo of Germany. Pro-
duction of the industrial and
pharmaceutical exports
should be up and running by
late 1997.
APC and JPMC, as part of
the public shareholding com-
pany, Jordico, are further-
more involved in four Joint
venture operations.
Starting production this
month is the Industrial and
Table Salt project, worth
{25m. with an annual capac-
ity of L2m tonnes of indus-
trial salt and 32,000 tonnes of
table and water-softening
salt.
The other three projects
are: a 390m Magnesium
Oxide project producing an
estimated 60,000 tonnes per
year by early 1999; a potas-
sium sulphate and di cal-
cium phosphate project in
Aqaba with a capacity of
75.000 tonnes and estimated
cost of $80m: a bromine and
derivatives project in a 50:50
joint venture with Israel.
Details of the last project are
still confidential, but it was
decided that the $80m-l00m
plant will be on the Jorda-
nian side of the Dead Sea.
By contrast, projects in
the oil and gas sector remain
much more difficult to get
off the ground.
Negotiations on a pro-
posed $2.5hn oil refinery in
Aqaba were suspended last
month, according to the Min-
istry of Energy and Mineral
resources, as the Corporate
Holdings of America (CHA)
consortium, one of three
interested parties and the
first pre-qualified for the
project, faffed to fulfil obliga-
tions specified in a letter of
Intent last June. The plant,
supposed to be built an a
bull d-operate- transfer (BOT)
basis, would have brought
Jordan. 5200m in annual roy-
alties.
Another large project is a
joint venture liquefied natu-
ral gas deal involving an
Israeli ■ consortium. Near
East Energy of Jordan and
Enron Corporation of the
US, which has rights . to
exploit Qatari gas reserves.
The $$00m project remains
extremely tentative, how-
ever, largely because of geo-
political sensitivities.
Few reservations
about the future
Despite recent
falls in bookings,
international
hoteliers remain
confident
Lord Byron’s pilgrim Childe
Harold longed for the desert
in order to forget the human
race.
Today, he might find even
the desert over crowded.
The contemporary travel-
ler has difficulties in grasp-
ing the appeal places such as
Petra had to last century’s
visitors, who found the rock-
carved city remote, exotic
and mysterious.
Jordan's sites still capture
the imagination, but much
of their mystery is now
destroyed by loud tourist
groups. In Petra, pedestrian
and horse “traffic jams”
block the narrow, channel-
like entrance called the Siq.
Despite government mea-
sures restricting daily visi-
tors to 2,500 and high
entrance fees, Jordan's main
tourist attraction has been
somewhat overrun in recent
years.
Jordan's tourists have
more than doubled in the
past five years, following the
end of the second Gulf War
and the beginnings of the
peace process.
There were a record i.im
visitors last year and, after a
long lull, the government
and private investors are
rushing to get their share of
the profitable tourism cake.
In 1995-1996 some 45 new
hotels with 8£00 beds and a
total capital investment of
JD133m were approved by
the government, adding to
the current number of 156
hotels in the country.
The tourism sector, the
country's third largest for-
eign currency earner after
expatriate remittances and
mineral exports, contributes
an estimated 10 per cent to
gross domestic product and
brought in revenue of $700m
last year. It was expected to
top the $lbn mark this year.
But much depends on
regional stability. Israel's
bombardments of Lebanon
in April. Jordan's bread riots
in August, instability in
neighbouring Iraq and the
latest flare-up of Israeli-Pal-
estlnian violence last month
have all affected tourism.
According to hotel manag-
ers and tour operators the
sector has suffered an esti-
mated 40,000 hotel booking
cancellations and a decrease
of 40 per cent in tours in the
last few months.
“Until March, we were
doing very well and we
expected 1996 to bring higher
occupancy because of peace
results.” says Mr Chawki
Ayoub, manager of the Inter
Continental in A mma n .
"Usually October and
November are very good
months, but we have already
had 125 cancellations.”
Rate tranquBGty: on peak days, visitors to Petra can number 4.000
At an industry conference
last month, the minister of
tourism, Mr Saleh Irsheidat,
said: “Tourism in Jordan has
been declining in the past
six months and there are no
signs pointing to improve-
ment for the rest of the year,
largely due to political devel-
opments in the Middle East.”
Royal Jordanian, the coun-
try's national carrier, has
seen 26,000 seat cancellations
for the September 1996 to
May 1997 period. According
to Dr Majdi Sabri, BJ's vice
president for commercial
affairs, the number of pas-
sengers from the US has
plummeted by 50 per cent
since the election of the
hardline Likud government
in Israel last May.
Not scared away as easily,
however, are investors in the
exploding number of hotel
developments. Most of them
expect political tensions to
fade in the next two years
and anticipate a peaceful,
open region at some stage in
the future, creating opportu-
nities for cross-border
regional tours from Syria
down to Egypt.
“There is a good reason for
people going into the hotel
business in Jordan.” says Mr
Ayoub. “Once people can cir-
culate freely there is great
potential."
The construction of new
hotels poses a big challenge
to the government in terms
of infrastructure develop-
ment. Electricity, waterpipes
and phonelines have not yet
found their way to areas
such as the Dead Sea or the
south beaches of Aqaba.
Mr Irsheidat gives the
example of Petra, where the
government has been unable
to keep up with the pace of
construction, and now hotels
have been asked to provide
their own water treatment
plants. Inadequate support
and complicated rules on
acquiring land in new devel-
opment areas such as Aqaba
have fuelled criticism of the
government in the private
sector. Investors also com-
plain about the lack of an
aggressive promotion strat-
egy to lure both tourists and
investors. Nevertheless, pro-
jects such as the JD26m con-
struction of a new 5 Star
Deluxe Four Seasons hotel
in Amman, to be completed
in 1999, are going ahead.
The risk of the kingdom
becoming “overhotelled" is
generally played down.
According to a feasibility
study undertaken by the
management consultants
Arthur Andersen Interna-
tional for the Four Seasons
project, the doubling of 5
Star Deluxe hotel rooms in
Amman by the year 2000
should stimulate overall
demand, leading to increased
differentiation between the
budget sectors and the pre-
mium end of the market
Provided the country’s
economic liberalisation pro-
cess goes ahead and. more
importantly, the peace pro-
cess does not deteriorate any
further, most investors can
remain optimistic about the
potential of Jordan’s tourism
sector to become the coun-
try’s leading industry.
And optimism prevails. As
Dr. Sabri puts it: “As long as
you have faiths on earth,
people will come and visit
the Holy Land."
JORDAN INTERNATIONAL
RANK PLC
YOUR JORDANIAN PARTNER
IN THE UNITED KINGDOM
Jordan International Bank Pic offers the following services:
Trade Finance
Foreign Exchange and Bullion Trading
Money Market Facilities
Private Banking
Commercial Loans
Property Lending
Securities
Please call George Shihata or Paul Gilbertson for further
information
Jordan International Bank Pic
103 Mount Street
London Wl Y 6AP
Tel: 0171 493 7528
Fax: 0171 3554359
Telex: 8814135 JORDMT G
MANAGEMENT
T he snag about manage-
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author’s point of view. Is
that there are so many
of the damned thin gs around. To
stand out on the bookstall you
need a snappy title and an acces-
sible theme. Perhaps most of all.
the publisher needs to convey a
sense of threat to the passer-by
which can be dispelled only by
buying the book.
On these criteria alone. The
Witch Doctors deserves success.
Its pitch is deftly laid out in the
subtitle: "What the management
gurus are saying, why it matters
and how to make sense of it.”
Management theorists, the pre-
amble tells us. are today’s ver-
sion of Shelley's poetic “un-
acknowledged legislators". Not
only do they lay down the law,
but they have the power to mess
around with our lives. Only
through studying their methods
can we deflect their sinister
farce.
The reality of the book is a
little different. John Mickleth-
wait and Adrian Wooldridge have
indeed studied the gurus, and
tedious work they must have
found it But as experienced jour-
nalists - both from The Econo-
mist - they know better than to
recreate the experience for their
readers. Nor. indeed, do they
insist on their thesis beyond the
opening pages. The' growing
power of gurus and consultants,
they concede, is mainly a
response to events. The real cul-
prit is change and uncertainty in
the wider world.
Thus, only a few chapters are
devoted to the gurus themselves.
At the outset come the heavy-
weights: Peter Drucker. described
as the one management theorist
who is required reading for every
educated person: and Tom Peters,
whom the authors regard as
flaky but interesting.
Towards the end comes a chap-
ter on the lightweights, among
whom it is good to see Edward
De Bono and the TofDers. along
with smaller fry such as Laurie
Beth Jones, author of the ineffa-
bly titled Jesus CEO. In between.
The Witch Doctors is - well -
another book on management.
As such, it is not bad at all. In
their review of management the-
ory, the authors start with an
observation of Drucker’s; that at
the heart ol the modem corpora-
tion lie the twin principles of
uncertainty and knowledge.
Uncertainty, in this view, is the
central problem: the fact that in
changing times no corporate
structure or business theory win
hold good for long. Knowledge,
on the other hand, is the answer,
since the only lasting asset in
uncertain times is intellectual
capital.
FINANCIAL TIMES FRIDAY NOVEMBER M096
TECHNOLOGY
Motorists get a
breath of fresh air
Frances Barthorpe on the manufacturers 7 response
to increasing demand for air conditioning in cars
M otorists dread
getting caught in a
traffic jam with
the sun beating
down and no means of keeping
cool. In such situations it is not
only tempers that rise. As cars
sit idling on the tarmac, the
levels of exhaust fumes, and
hence pollution, go up, leaving
motorists with the choice of
winding the window down and
breathing in pollution, or
sweltering with the window
shat.
With temperatures predicted,
to rise by between l«C and 3.S°C
daring the 2 1 st century, things
are unlikely to improve. No
wonder demand for air
conditioning in cars Is
increasing.
A recent survey by DRI/
McGraw-Hill for Ford revealed
nearly that a third of all UK
respondents would consider air
conditioning when choosing
their next vehicle. The figure
for German respondents was
nearer 60 per cent.
By the end of the century, it is
predicted, nearly half of new
cars being produced each year
in Europe - or about 7.1m cars
- will have air conditioning,
compared with just 3.16m in
1994.
Since automotive air
conditioning was first
introduced in North America 56
years ago, design and
development costs of the
components have come down
considerably. Mass production
combined with the development
of more compact, cheaper units
for the smaller-capacity engines
in European cars allowing air
conditioning to be fitted in a
much greater range of cars.
Increased volume is a big
factor when it comes to cutting
costs, says Larry Campbell.
Ford's climate control
subsystems manager for small
and medium-sized cars at its
factory in Cadez. France. “Five
or 10 years ago the air
conditioning installation
rate in cars was about 3 per
cent. Now volumes are
much higher, manufacturing
costs are dropping.”
Tony Jackson on The Witch Doctors, an attempt to
make sense of the changing fashions in gurus
Hocus focus
Running parallel to this is a
second theme: that management
theory consists of an uneasy
equilibrium between two conflict-
ing schools, the bard and the
soft. The first is Taylorism,
which says production is a mas-
ter plan for use by idiots. The
second might be termed Toyota-
ism, which says efficiency comes
from liberating the minds of the
workers.
Because of this , the authors
argue, management theorists
keep sending out conflicting mes-
sages. Companies are told to be
“flexible" - that is. sack people -
and to win their employees’ trust.
They are urged to focus on qual-
ity. and also on speed. They must
have a vision, and they must be
ready to change direction at a
moment’s notice.
On balance, the authors are
softies. They have little time for
re-engineering, one of the most
reviled management innovations
in recent years, describing it as
an attempt “to adapt Taylorism
to the age of the computer”.
Besides, they say. re-
engineering concentrates on how
a company produces, not what. It
can be a prescription for making
the wrong things perfectly.
More generally, the authors
come across as mild sceptics:
which, given their reading hab-
its. is probably the key to sanity.
Talk of upheavals in work prac-
tices. for instance. Is largely dis-
missed. “The most horrifying
thing about the “future of work*
may be just how similar it will
be."
Globalisation, at least in the
old-fashioned sense, is shrugged
off as a myth. It is simply not
true, they say, that the same
products can be sold anywhere.
As for making them anywhere,
tell that to the film studios which
try to emulate Hollywood.
On the stakeholder/shareholder
debate, they point out - justly -
that it has been somewhat over-
taken by events. It is no longer
true that the Japanese or Ger-
man models of corporate control
perform better. When it comes to
creating high-tech industries,
nasty old shareholder America is
miles ahead. Conversely, looking
at the grosser examples of board-
room opulence in America, it
may be that shareholder power
has not been taken far
enough.
Most of this represents the
authors’ own view of life, as
opposed to that of the gurus. But
there is one chapter in which the
opening thesis is forcefully re-
addressed. This examines the
malign influence of management
theory on the public sector, in
the US and UK in particular.
• It is easy to see why public
servants, on both left and right,
should embrace the gurus. Public
service has fallen in general
esteem, and stealing manage-
ment’s clothes is an attempt to
win it back. Besides, managers
are supposed to be cost-cutters,
and there is never enough in pub-
lic-sector budgets to go round.
But as the book points out, cus-
tomers and citizens are different
things. We may be customers of
state-run railways and gas com-
panies: but not when .we pay
taxes or are conscripted into the
army. Besides, the public sector
is by its nature slow-moving. It
therefore risks being landed with
the exploded five-year-old theo-
ries of the private sector.
Indeed, five years is a long time
in management. There is nothing
deader than an old guru’s view of
the future. But that, doubtless, is
all part of the authors’ plan: five
years on. look for Witch Doctors:
The Next Generation.
The Witch Doctors is available
from FT Bookshop by ringing +44
181 964 1251 or fax credit card
details to +44 181 964 1254 (post
and packing £1.50 m Europe)
The heart of an air
conditioning system is the
compressor. Fort uses a
“variable scroll” type which, it
says, combines excellent noise,
vibration and harshness
characteristics with durability.
According to Ford it also
minimises the effects of air
conditioning on fuel economy,
and eliminates the clutch surge
often experienced in small cars.
Koen Devi be, responsible for
marketing at Delphi Harrison
Thermal Systems, says the main
developments in the future will
be on the compressor side. "The
target will be smaller cars, like
the Astra and the VW Golf. So
the compressors will need to be
more compact, providing better
fuel economy, and ease of
operation,” says Devitz.
Canadian-based REG
Technology is developing an
automotive air conditioning
compressor based on its
patented Rand Cam rotary
engine design. The new positive
displacement compressor is half
the size of the units now used
and provides up to 20 per cent
more cooling capacity.
Another area of development
will be more sophisticated
filters, catting out dust, pollen
and other particulates to
improve the quality of the
interior air. But better sensors
are needed to achieve this.
In July this year Warwick
University was selected to co-
ordinate an Eculm Europe-wide
project, designing high-
technology sensors to help
monitor both the level of air
pollution generated by vehicles
and the air quality in the
driver’s cabin.
Julian Gardner from the
university’s engineering
department will lead the
project, which includes Fiat;
VDO, the German car sensor
component company; and
universities in Germany,
Sweden and Switzerland.
Warwick will be developing a
version of its “electronic nose”
- sensors comprising
conducting polymers and
semiconducting oxides. The
ultra-low power sensors will be
capable or using the normal car
power supply- Fiat expects to
have the prototype sensors
Installed in lm cars by the end
of the decade.
According to Devitz.
“multi-zoning" will also be
appearing in to p-of-the- range
cars within the next 10 years.
“This will enable one side of the
car to be kept at a temperature
of, say. 22°C and the other side
at 25°C," says Devitz.
Two other developments are
likely. The first is in the area of
automatic temperature control.
Today 40 per cent of
factory-fitted air conditioning
systems use manually adjusted
thermostatic controls. But over
the next few years ATC is
‘expected to become more widely
available.
The second development is
likely to be in alternative
refrigerants. Two years ago,
because of environmental
concerns over the use of
chlorofl uorocarbons (CFCs). the
R12 refrigerant used in air
conditioning systems was
replaced by the more expensive
CFC-free R134A. Although less
harmful than R12 it has also
been proposed that this should
be banned by 2030. So the
search is on for other
alternatives.
In July. US-based Technical
Chemical Company launched its
alternative to R12, Johnsen's
Freeze 12. “U requires no
expensive vehicle conversion
and is much lighter and less
costly than R12." says Larry
Easterlin, TCC’s vice-president
of sales and marketing.
In the UK, Normalair-Garrett
announced recently that it had
devised the world’s first air
conditioning system for trains
using air-cycle refrigerant
technology. This uses air as a
refrigerant instead of chemical
refrigerants.
A number of studies have
been carried out on the
feasibility of applying similar
technology in the automotive
industry.
Frances Barthorpe writes for
Professional Engineering
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13
FINANCIAL TIMES FRIDAY NOVEMBER 1 1996
nose are tense days
for the UK’s arts
Wmsanhip industry.
Unless some last min-
frntt, the Budget on November
26 is likely to Include among its
smallest print another £500,000
cut in die government’s contri-
hfcSSffc* 0 ^ Pairln e Scheme,
which has proved such a great
stimulant in persuading business
to Sponsor the arts.
Last year the grant was cut by
£600,000, to £5m with a similar
reduction earmarked for 1997 - 98 .
For the Association for Busi-
ness Sponsorship of the Arts,
which administers the scheme,
such a reduction would be disas-
trous. Director Cohn Tweedy is
contemplating closing down a
regional office, probably Wales,
if the funds are cut
However, Tweedy is hopeful
that the success of the scheme
will cause a last minute rhtmga
of heart by -Virginia Bottoxnley,
the heritage secretary.
Sponsorship/Antony Thomcroft
The need to keep good company
In its li years it has enconr*
aged business to give £ 97 m to
the arts, and last year’s re-jig-
ging of the guidelines, designed
to persuade companies to com-
mit for longer and to stress
a c c e ss to the arts, has revitalised
the operation. ,
This year four sponsors — "
Toshiba at the ICA; Visa with
the London Film Festival; RJB
Mines with the National Coal
Mining Museum; and Mastercard
with National Music Day - all
attracted the new, increased,
£75,000 top up, thantt to their
own commitment of £150,000, or
more, to the cause. If the grant is
cut the substantial £75,000 incen-
tive win probably be reduced.
To date, arts sponsorship in
the UK has held up well, despite
the pressure on companies from
arts organisations to help them
with the partnership funds
needed to secure Lottery money.
When the sponsorship total for
1995-96 is announced shortly it
could even show a slight rise
on the record £82m of the previ-
ous year.
Companies are obviously reluc-
tant to bow to the government’s
wishes and assume the role of
major partnership funder of Lot-
tery projects.
★
As the changes in the Pairing
Scheme acknowledged, the prob-
lem with sponsors is that they
are inclined to be short-termist
On average they will support an
arts company for three years at
most and then become bored: the
novelty, and the newsworthi-
ness, palls.
It does not have to be this way.
A long term commitment can
bring great rewards, most obvi-
ously to the arts organisation
bnt also to the sponsor who
gains in pride and prestige. This
is certainly the case with Mid-
land ttwiiir, which has just cele-
brated 25 years supporting the
Proms at the Royal Opera House
with eight cut-price perfor-
mances of Wagner’s The Ring.
ending tomorrow night, and
with Shell, which is embarking
on its 21 st year of backing the
Shell-1£0 Music Scholarship.
This is the most Important
prize for budding young profes-
sional musicians in the UK (the
BBC Young Musician, sponsored
by Lloyds, seeks to uncover solo-
ists) and most of the winners
now lead orchestral sections: five
are prominent in the LSO itself.
The 1997 competition is seeking
a woodwind player and 350
under 21s wiH get the chance of
working with LSO professionals
even if only one takes the
scholarship.
The programme costs Shell
£130,000, and to celebrate the
anniversary it is once again
sponsoring the LSO’s only UK
tour. Gum December 2, with con-
certs under new principal con-
ductor Sir Colin Davis in Man-
chester. Newcastle, Glasgow and
Aberdeen. The tour will cost
Shell £200,000. Next year there
win be two additional concerts
to promote previous past schol-
arship winners, which will add
another £150,000. Fortunately,
Shell seems eternally wedded to
the scholarship, which has
attracted 5,000 young musicians
since 1976.
Over the last week young peo-
ple have been able to make up
their minds about Covent Gar-
den’s newfish) Ring for £15 as
against the £132 mice of a ticket
for a good front seat - tinmire to
the Midland* Proms. Over the 25
years of the sponsorship, the
Midland has pumped £3. 5m into
the Opera House Proms, creating
the audience of the future.
Research suggests that 37 per
cent of those attending have
never visited the ROH before and
just over a half are under 30.
*
Arts companies should never
despair: there are always new
companies discovering the
attractions of sponsorship, or
extending their commitments.
Selfridges has got involved for
the first time, pledging £50,000
towards the Serpentine Gallery
over the next three years, while
planning initiatives in other arts
sectors. As is so often the case,
the arrival of a new managing
director. Vittorio Radice from
community conscious Habitat,
sealed the deal.
In return for backing shows at
the Serpentine, including the
recent Richard Wilson exhibi-
tion, and the first when the Ser-
pentine re-opens late next year
after its facelift, he wants to
bring more art Into the store.
The Serpentine will advise on
this, and cm window displays.
h
Theatre /David Benedict
‘Buried Treasure*
“It 5 a pity the flames didn’t claim
you. Still, there’s always helL ”
B urning down a Church
may not appear on the
official list of the Seven
Deadly Sins but as tor
as Robert, the local vicar is con-
cerned, it probably weighs in at
Number 8. In David Ashton's
whimsical Buried Treasure, the
people of a remote Scottish sea-
side town have narrow views
long memories -and when long-
lost son and former arsonist,
Frank McCoig, returns, they
aren’t about to forgive and forget.
Not that he appears to give a
toss. In addition to riling the
townsfolk and r.biria, his former
lover, by his mere presence, he’s
intent on taking up where he left
off, running a disco in the local'
dance-halL
The promise of Saturday night
shenanigans isn’t exactly manna
from heaven to the outraged
townsfolk, nor their vicar, partic-
ularly since, off-duty, he’s Lin-
da's husband. In the midst of thka
collision between past and pres-
ent, Frank remains undeterred.
Like Charlie in Chris Hannan’s
excellent Shining Souls at the
Traverse earlier this year, he's
looking for his soul.
Passions may be r unning hi g h ,
but Ashton pursues Ills goal
beneath a light, comic surface.
The play feels more Uke a Short
story, the' predominantly comic
mood effortlessly suggested
thrg^h_pbli£ue, picturesque
characterisation. The tone is well
set up In the slightly drifting first
half, with Collette O’Neil in fine
fettle as the feisty, marvellously
suggestive Sadie, an elderly
woman who has set up home in
Frank’s abandoned hall , dispens-
ing succour and sharp retorts as
the fancy takes her. Problems set
in with the second half as events
take over and the plotting begins
to run ahead of the writing.
The disco turns Into a disas ter
and revelations come thick and
fast. We’re unprepared for the
sudden pitch into melodrama as
lust and sins of the father are
laid bare and loose ends are tied
up in a rush of a c t iv i ty . Ashton
abandons his sardonic tone and
opts instead for full-throttle con-
frontation. Robert loses his rag
and, in an ecstasy of loathing,
reveals what really happened the
night Frank set the church on
fire. But Frank’s immediate
understanding of his recaptured
memories and their Implication
is. too swift and simplistic.
Robin Lefevre's Bush Theatre
production boasts neat perfor-
mances. Alexander Morton lends
feckless Frank a shabby but
oddly touching quality Jenni-
fer Black copes well as the under-
written Linda, a woman forced to
make the best of a bad job but
stxmg into life by the reappear-
ance of her childhood sweetheart.
Standing on the pier of Tanya
McCullin’s atmospheric set, they
reminisce about illicit activities a
room away from an everprffient_
father. “Thank God he loved his
Mantovani records." Even they
cannot redeem the final scene of
romantic hope against adversity
but at its best the play, however
sdjgbt^Show^ .Ashton unafraid to .
raid with appealing and unfash-
ionable warmth..
Lyric Studio, Hammersmith
until November 16 (0181-741
2311).
r
Ata* mi*-
Collette O’Neil. Alexander Morton and Anthony J O’Donnell in ‘Buried Treasure’
Linehan brings hope and joy to ‘Happy Days’
I n Samuel Beckett’s Happy
Days, drama is stripped to
its sheerest essence. We
observe the gradual extinc-
tion of a body, of a mind; of
language.
We also observe the remnants
of a -marriage, a marriage in
which we hardly know which
counts for more: the impenetra-
ble and separate solitudes of
woman and Tnan, or their mutual
dependence. Do they need each
other, or to be quit of each other?
Are they happy to live, or do they
long for death?
The play shows contradictory
and ambiguous impulses. Bleak
though this is, Happy Days is
life-enhancing; and, by the way,
deeply funny.
There is no play of the twenti-
eth century ! find more marvel-
lous. During the 1990s, I have
seen it in three different produc-
tions; I love it mare each time;
and fins production - directed by
Karel Reisz; featuring Rosaleen
T Jnehan as Winnie; reaching the
Ahneida Theatre last night from
Dublin’s Gate Theatre (it was
also shown in New York in
August) - is the best I have seen.
It makes the play seem brighter
and larger than ever.
Winnie, middle-aged, Is buried,
in Part One, up to her waist in
scorched earth, under a burning
sun; in Fart Two, up to her neck.
Willie, who seldom appears,
turns out to be older, and bald-
pated. The ageing nipple, wed to
the aged penis? Certainly the
way the play shows that the sex-
ual instinct is among the last to
vanish (in Willie) is among its
most marvellous jokes. Bells
pierce the air now and then; and
we know that, on one level, Win-
nie an d Willie are ending their
days in some kind of institution.
But Willie seldom gives voice;
whereas Winnie talks, talks,
talks. His he arin g is toiling; so is
his ability to communicate; so is
her memory, and she knows the
day approaches when words fall
too. “Why then just close the
eyes - and wait far the day to
come - the happy day to come
when flesh melts at so many
degrees and the night of the
moon has so many hundred
hours." And it Is in her great
monologues' that the human
spirit becomes most luminous.
Much of the time we know she
is merely looking on the bright
side (“That is what I find so mar-
vellous") where there is none;
but not always.
For her very resurgence is
brightness enough, and so too is
her preparedness for death. Yet
Beckett also injects the play -
how much I have never under-
stood until this production -
with moments of bitterness,
doubt, alarm, and scorn. When
Willie makes his final appear-
ance, crawling up the mound
towards her, she is dismissive,
shocked, tender, curious. “Is it
me you're after ... or Is it
something else?” Beside her,
indeed, is a revolver.
There is much more plot to this
play, though buried deep, than I
had realised before Reiss’s tre-
mendous production.
Tim Hatley, designing, h a s
turned Winnie’s scorched mound
into an earthy promontory, the
result is thrilling. And T Jnehan,
even though one may question
individual decisions about line-
readings, carries the evening.
A superb account of a supreme
play. Comedy and pathos, exis-
tential grandeur and satiric petti-
ness, hope and despair, pour from
her in a steady stream, perfectly
phrased.
Alastair Macaulay
Almeida Theatre, London Nl,
until November 9 (0171-359
4404).
Concerts /Andrew Clark
Orchestral
contrasts
O ne of the rewards of
living in London is the
chance to compare,
week after week, the
qualities and playing styles of all
the foreign orchestras who seem
to queue up to play here.
Such an opportunity arose on
consecutive evenings this week.
The two orchestras were the Dan-
ish National Radio Symphony
and the Czech Philharmonic -
neither a huge box-office draw on
their own. but each with a tradi-
tion of championing their
countrymen's music on British
soiL The attraction, therefore,
was not so much the Beethoven
concertos which lay at the heart
of each programme - fascinating
as these performances were, with
highly esteemed and idiosyn-
cratic soloists - but the music of
their own national schools.
And . no national school has
been better preserved than the
Czechs’. Notwithstanding the
long-r unning problems which
have left it without a chief con-
ductor in its centenary year, the
Czech Philharmonic sounded in
excellent shape on Tuesday night
at the Royal Festival Hall Its per-
formances of Dvorak's Seventh
Symphony and Jaxu&Cek’s Taras
Bulba had all the qualities that
mak e a Czech orchestra playing
Czech music such a pleasure.
It is not just the unnnstakeably
Bohemian character of each sec-
tion, the dancing violins, the
warmth of the lower strings, the
euphonious glow of the horns,
the Idiomatic songfulness of the
woodwinds; what distinguishes
this orchestra Is the way all these
qualities find their context in a
harmonious whole.
This was particularly true of
the DvofAk, which opened the
programme. There was nothing
obtrusive in any of the detail,
and yet each phrase and para-
graph yielded a defining charac-
teristic: the lyrical fluency with
which Antes and strings
announced the opening move-
ment’s second theme, the unman -
nered voicing of instrumental
parts in the Poco adagio, the
sense of proportion in the
scherzo, the cheeky little ritar-
dandos in the finale, giving a
spring to the phrasing which
only a native of Prague could get
away with. That none of this
appeared to have been superim-
posed by the conductor is a trib-
ute to Libor Pegek and his under-
standing of the orchestra's (and
the music’s) innate qualities.
Apart from some charmless
phrasing at the start of the slow
movement, Pefiek’s reading had
ideal warmth and symphonic
thrust, and his JanACek was
hugely imposing. With its com-
plex rhythms and tempo changes,
Taras Bulba is hard to pull off:
this performance combined seam-
lessness, spareness and majesty.
The encore was Oskar Nedbal's
Valse triste. a Bohemian bonbon
which Pegek treated with Beecha-
mesque flair.
At the Barbican the previous
evening, the Danish National
Radio Symphony Orchestra did
not have the benefit of a Danish
conductor - nor, judging by its
performances of symphonies by
Bent Sorensen (b.1958) and Niel-
sen. does it have a distinctive
personality. Its music director,
Ulf Schirmer, unfolded Soren-
sen's Symphony with German
efficiency and brought a calcu-
lated logic to the second move-
ment fugues of Nielsen’s Fifth.
But the playing was no more
than competent.
T his is a sad indictment of
an orchestra which did
so much to establish
Nielsen's name in this
country before the CD age
(through its pioneering perfor-
mance of the Fifth Symphony at
the 1950 Edinburgh Festival and
a Nielsen cycle in London in the
late 1960s). At Monday's concert,
the Fifth sounded depress ingly
matter-of-fact. Schirmer ironed
out all sense of mystery from the
first movement - noisy air-condi-
tioning didn't help - and turned
the great crescendo into a parody
of expressionist battle music. Nor
was there much joyous impulse
in the second movement.
The DNRSO can take credit for
bringing a work by a living com-
poser, but Sorensen’s 22-minute
Symphony turned out to be nei-
ther Scandinavian nor properly
symphonic. After a few pages of
Sibelian desolation, it emerged as
a medley of styles, filtered
through an interminable wash of
glissandos. The Danes accompan-
ied Joshua Bell in a gorgeous-
sounding account of the Beeth-
oven Violin Concerto - so gor-
geous, in fact, that the music lost
all momentum under the weight
of Bell’s poetic self-absorption.
The Czechs provided solid sup-
port for Mikhail Pletnev In the
First Plano Concerto: no rhetoric,
no showmanship, but Insouciant
control, crystalline evenness and
a personal stamp on every
phrase.
The Czech Philharmonic's sec-
ond Festival Hall concert, organ-
ised by the Royal Philharmonic
Society, is tomorrow.
IKTERNATICWAL I
m AMSTERDAM
CONCERT
Concartgebouw Tel:
31-20-6718345 .
• Nedertands Philharmomscn
Orkest. with conductor Hartmut
Haenehen and pianist Markus
Groh perform works by R. Strauss
and ^Schumann; 8.15pm; Nov
3, 4, 5
■urn Tel:
hschild: exhibition
s " of Chateau
ild, with designs
>re, Alechinsky,
JJcasso, Warhol,
2 and Bacon; from
Monteverdi.
Stephen StubbSi
ie Tragico media &
no and the Vocaal
nets Include John
Mark Ainsley, Juanita Lascarro
and Brigitte Baileys; 8pm; Nov
4
■ BARCELONA
EXHIBITION
Museu Nadonal d’Art de
Catalunya Tel: 34-3-4237199
• The Splendour of Baroque
Painting: exhibition featuring 56
works from the museum’s
collection, allowing the public to
follow the evolution of the
different styles of the-16th, 17th
and 18th centuries, from
Mannerism to Rococo. Artists
represented Include Tintoretto. S
Greco, Rubens, Tiepolo,
Fragonard, Rlbalta, Ribera,
V elte quee. Zurbardn and
VH ado mat; to Nov 15
■ BASEL
Deutsche Oper Berlin Tel:
49-30-3438401
• Beatrice dl Tends: by Bellini.
Conducted by Marcello Vlotti,
performed by the Deutsche Oper
Berlin. Soloists include Vladimir
Chernov, Lucia AJiberti and
Octavio Arevalo; 6.30pm; Nov 3
■ BILBAO
EXHIBITION
Museo de Bellas Aries Tel:
34-4-4419536
• Anglada Camarasa. Sus
ambfentes: exhibition featuring
450 works by Anglada Camarasa,
the majority of which come from
the artist's collection; to Nov 3
■ BRUSSELS
EXHIBITION
Mus6e d’Art Modems Tel:
32-2-5083211
ART & ANTIQUE FAIR . • Het Legaat Irene
Messe Basel Tel: 41^61-6862020 Scutenajre-Hamoir. Van Magritte
• TEFAF Basel 96: 125 dealers tot Magritte: exhibition of the
from 12 countries are represented entire collection of the late Irene
at the second edition of this Hamoir-Seutenaire. The collection,
international art and antique fair which was bequeated to the
which features paintings, museum in 1994, features 292
drawings, prints, books and other works. by Surrealist artists such as
art objects from the classical MariAn, Mesens, Eemans,
antiouitv to the present; to Nov 3 Graverol, Simon and Magritte. The
^ latter artist is represented by 107
_ at works, including 23 paintings; to
■ BERLIN Dec 22
haus-Tek 49-30-203090
funk-Sinfonleorchester
1th conductor Lawrence
ncl pianist Elena
owa perform works by
«■ - Cn acral" Soffl:
NOV 3
OPERA
■ COLOGNE
CONCERT
KBIner Philharmonic Tel:
.49-221-2040820
• Orchestra of St John's Smith
Square: with conductor John
Lubbock and pianist Andfe Watts
perform works by Prokofiev,
Beethoven, Mendelssohn and
Haydn; 8pm; Nov 4
■ DUBLIN
EXHIBITION
National Gallery of Ireland Tel:
353-1-6615133
• William J. Leech (1881-1968),
an Irish painter abroad: a
retrospective exhibition of works
by William J. Leech. It brings
together over 100 works and
explores the artist’s drawings, .
watercolours and paintings, the
majority of which are in private
hands and Tittle known; to Dec 1 5
■ LONDON
CONCERT
Barbican Hall Tel:
44-171-6384141
• Koninkfijk Concertgebouw
Orkest with conductor John Eliot
Gardiner and mezzo-soprano
Anne Sofie von Otter perform
works by Weber, Berlioz and
Schubert; 3.30pm; Nov 3
Royal Festival Hall Tel: -
44-171-9604242
• Ptiilharmonia Orchestra: with
conductor Leonard Slatkin,
mezzosoprano Catherine
Wyn-Rogers, tenor Justin
Lavender, bass Anthony
Michaeis-Moore and the
Philhanmonia Chorus perform
Elgar's The Dream of Gerontius;
7.30pm; Nov 3
DANCE
Peacock Theatre Tel:
44-171-314-8800
• Perfumes de Tango: this show
choreographed by Miguel Angel
Zotto and Milena Plebs and
performed by the tango company
Tango por Dos opens the newly
refurbished Peacock Theatre
(formerly the Royalty Theatre),
Sadler’s Wells’ temporary home;
8pm, Sat also 3pm; to Nov 2
OPERA
London Coliseum Tel:
44-171-8360111
• Rigoletto: by Verdi. Conducted
by Noel Davies, performed by the
English National Opera. Soloists
Include Peter Sid horn, Janice
Watson and Jean Rigby; 7.30pm;
Nov 2, 5
Royal Opera House - Covent
Garden Tel: 44-171-2129234
• Gfitterdammerung: by Wagner.
Conducted by Bernard Haitink
and performed by the Royal
Opera. Soloists Include VMan
Tierney' Ann Murray and Gillian
Webster; 4pm; Nov 2
■ MUNICH
OPERA
Nations (theater Tel:
49-89-21851920
• Der fltegende Hollander: by
Wagner. Conducted by Peter
Schneider, performed by the
Bayerische Staatsoper. Soloists
include Luana DeVol, Marita
Knobel, Jaakko Ryhtinen and
Peter Stralca; 7.30pm; Nov 3
■ NEW YORK
CONCERT
Alice Tufly HaO Tel:
1-212-875-5050
• A meric an Symphony
Orchestra: with conductor Leon
Botstein, pianist Stephen
Montague and the Yale Glee Club
perform works by Ives, Ruggles
and Cowell; 8pm; Nov 2
OPERA
Metropolitan Opera House Tel:
1-212-362-6000
• La Traviata: by Verdi.
Conducted by Maurizlo Barbacinl.
performed by the Metropolitan
Opera. Soloists include Arteta,
Giordani and Frontali; 1 .30pm;
Nov 2, 5 (8pm)
■ PARIS
CONCERT
Theatre des Champs-BysAes
Tel: 33-1 49 52 50 50
• Acte and Galatea: by Handel.
Concert performance, conducted
by William Christie and performed
by Les Arts FJorissants. Soloists
include Sophie Dan ©man, Paul
Agnew and Alan Ewing; 7.30pm;
Nov 5
■ VIENNA
CONCERT
Konzerthaus Tel: 43-1-7121211
• David AJ berm an and Rolf Hind:
the violinist and pianist perform
works by Reich, Dun, Scelsi and
Hosokawa. Part of the festival
Wien Modem; 7.30pm; Nov 3
Listing compiled and supplied
by ArtBase The International
Arts Databasa, Amsterdam, The
Netherlands. Copyright 1996. Ail
rights reserved. Tet 31 20 664
6441. E-mail: [email protected]
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14
FINANCIAL TIMES FRI DAY NOVEMBER I 1996
COMMENT & ANALYSIS
Philip Stephens
Victory for vision
For all his failings, Bill Clinton offers US voters a better
alternative to the atomised society of die new right
When Bill Clinton raises his
glass next week, the first
toast will be to Newt Ging-
rich: the second to Alan
Greenspan. Never mind that
they are Republicans. That
is the secret of Mr Clinton's
success. The president takes
help from wherever it
comes. From this, many
have concluded his impend-
ing re-election hardly mat-
ters. They are mistaken.
Mr Clinton will be the
first Democrat to win two
consecutive terms since
Franklin Roosevelt took a
long lease on the White
House In 1933. So what, the
cynics say. His politics are
not radically different from
those of Bob Dole. The story
or how Mr Clinton has
filched conservative policies
I to reinvent his presidency
has been written a thousand
times.
This version of events is
both true and misleading.
Hard though it may be to
celebrate his personal suc-
cess, Mr Clinton's victory
will count. His enemies are
not alone in their doubts
about the president’s char-
acter and the ethics of his
administration. He is as
Hawed as he is engaging.
But it is an error to under-
estimate the voters’ repudia-
tion of the Republican alter-
native. This time Mr Clin-
ton has come out an top in
the battle of ideas.
In an era of economic
insecurity and social frac-
ture, moderation has tri-
umphed over extremism,
morality over the moral
majority. The electorate is
suspicious of the state. But
on balance it has concluded
that the centrifugal forces
in American society
demand a counterweight.
Big government no, but
enabling government yes.
Mr Dole has played a
walk-on part in Mr Clinton's
victory. His fumbling cam-
paign. his ties to the
tobacco industry (who else
still doubts nicotine is
addictive?! and his U-turns
on tax and affirmative
action have exploded the
myth that the former Sen-
ate leader was the last hon-
est man in Washington. His
choice of Jack Kemp as run-
ning mate was an Ill-Judged
reminder of the price the
nation has paid in increas-
ing budget deficits Tor Ron-
ald Reagan's tax cuts. The
voters have signalled they
will not fall for the same
trick twice.
But the real losers have
been the Republican revolu-
tionaries who swept the
Congress In 1991. Mr Ging-
rich was their messioh.
Remember Newt? A year or
so ago. the speaker of the
House of Representatives
promised to remake the
political landscape. An
immodest . man. this high
priest of market economics
and moral authoritarianism
told us he would “shift the
planet". Admirers or his 10-
point Contract with Amer-
ica spoke as if Moses had
revisited Mount Sinai.
The absurdity- of Mr Ging-
rich gave Mr Clinton the
space he needed to recast
the politics of the Demo-
cratic party after two disas-
trous years. This president
takes his chances. He made
tough choices (some good:
some, as on welfare reform,
bad). He abandoned his par-
ty's liberals and collabo-
rated with a Republican
Congress. The White House
strategists called it “tri an-
gulation". It worked.
The president had
luck on his side.
He entered the
White House at
just the right
moment in the
economic cycle.
But he also had
Mr Greenspan
Mr Gingrich thought he
could close down the gov-
ernment. Instead. Mr Clin-
ton closed down the Repub-
lican revolution. Now. the
only people prepared to give
the Speaker television air-
time are the Democrats. He
is their best advertisement.
If they win back the House
of Representatives next
week (a 50:50 bet). Mr Ging-
rich Is destined for perma-
nent obscurity.
For all the tacking. Mr
Clinton has stuck with his
party's core values. Except
on welfare reform, he has
appealed to tolerance and
decency against the far
right’s scapegoating of
immigrants and minorities.
He cut taxes for the poor
through the eamed-income
tax credit. He will win Calif-
ornia in spite of his refusal
to back that state's assault
on the weak. His ambitions
plans for healthcare reform
fell victim to the (errone-
ous) charge that It would
nationalise medicine. But he
has kept faith with the
analysis that America needs
to widen access to health-
care.
What really counts,
though, is that Mr Clinton
has won the argument for
affirmative government.
The alternative is an atom-
ised society. In his favourite
phrase, the task of politi-
cians is to give people tools
to make the most of their
lives. Government can serve
the people. It may seem
obvious, but this will now
become the leitmotif for par-
ties of the centre-left across
the industrialised world.
For his second achieve-
ment. Mr Clinton's debt is
to Mr Greenspan, the septu-
agenarian chairman of the
Federal Reserve. The voters
have been prepared to listen
to the president, to ignore
his flaws because of the per-
formance of the economy.
His administration has seen
four years of uninterrupted
growth, subdued Inflation,
the creation of more than
10m new jobs and the
lowest budget deficit for
more than a decade.
The president had luck on
his side. He entered the
White House at just the
right moment is the eco-
nomic cycle. But he also
had Mr Greenspan. It was
the Fed chairman who per-
suaded Mr Clinton that the
economic reward of a lower
budget deficit would out-
weigh the political cost of
tax increases for the middle
classes. The president’s
shrewd faith in Mr Green-
span has been rewarded
with an interest rate policy
skilfully calibrated to sus-
tain rising output
Mr Clinton's success has
wider significance. It defies
the reflex that says that the
centre-left is irredeemably
Irresponsible when it comes
to economic management.
In tackling the deficit, a
Democrat president has
made a start on clearing up
a mess left by Republicans.
And he bas reaped the
rewards. Britain's Tony
Blair might take note.
None of this provides
guarantees for the next four
years. History tells us that
US presidents are usually
less effective in their second
terms. Mr Clinton has yet to
provide an honest explana-
tion of the ethical lapses of
his administration. The
pressures here are likely to
get stronger rather than
weaker. He has identified '
the big challenges facing
America, but he bas come
up with some pretty small
answers. A $500 per child
tax credit, tougher gun con- t
trol, and more rigorous
standards in schools are
worthwhile ambitions. They
are hardly a substitute for
the boldness and risk-taking
which stood behind Roose-
velt's greatness.
It is here we come to the
central paradox behind the
Clinton presidency. He is
not an uplifting nor a par-
ticularly honest politician.
But he is a powerful shield
against the truly selfish
society. The battles he has
won are far more important
than the man,
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-LETTERS TO TH E EDIT OR-
. yNUmber.-dn©,S Bridge, London SEI 9HL
Wit are keen to encourage lattcrefrom' readosaroundthe world. Letters may be iT* h^w /wwwJTajm
to W). eStSsxdItor#ft.com Published letters are also available ontbe FT ^.^,!^ //wwV ' Fr ' COin
: . Translation may be available for letters written in the main international
Trade pact is committed to liberalisation
From Mr Rubens Antonio
Barbosa .
Sir. I read with interest
your editorial entitled
“Trade blocs" (October 24),
as well as the articles related
to Mercosul that have
appeared in your newspaper
this week.
As Brazil is currently hold-
ing the pro tempore presi-
dency of Mercosul, 1 feel it
would be appropriate to
point out that the editorial
was too hasty In accepting
the conclusions of an unoffi-
cial internal study written
by a World Bank economist.
This study contains inaccu-
rate information and statis-
tics dating from 1994, which
apparently question Merco-
sul 's real benefits for its
member countries and exter-
nal trading partners and
seems to imply a danger to
trade liberalisation, not tak-
ing into account that tha
customs union came into
being only in January 1995
following a transition period.
It is puzzling to speak of
economic inefficiencies
within Mercosul when
exports of a wide range of
highly competitive goods
from Brazil and partners
have restricted access to
developed areas where trade
barriers are raised in order
to protect inefficient indus-
tries.
It is altogether incorrect to
suggest the existence of high
tariffs or barriers to com-
merce with non-member
countries when the average
Mercosul common external
tariff has been substa n tially
reduced in the past five
years qrifi is currently at ll.l
per cent, equal to Chile’s.
It Is also diffi cult to accept
trade diversion as a signifi-
cant result of Mercosul when
trade with non-member
countries has grown 163 per
cent in the past five years.
This can only demonstrate
Mercosul 's commitment to
trade liberalisation and the
tremendous benefits reaped
by all our partners around
the world.
In the discussion of trade
and regionalism, the real
issue is liberalisation of
trade. Mercosul is a success
story in open regionalism.
Brazil and our partners in
Mercosul participate actively
in the Committee of
Regional Trade Agreements
of the World Trade Organisa-
tion. What should be expec-
ted is th e compliance of all
regional trade agreements
(including, not least, the EU
and North American Free
Trade Agreement! to the
principles and disciplines of
multilateral trade.
Rubens Antonio Barbosa,
ambassador,
Brazilian Embassy,
32 Green Street,
London W1Y 4AT, UK
Right price for Heathrow slots
From Mr Gideon Nellen.
Sir. Mr Richard Botwood,
the director-general of the
Chartered Institute of Trans-
port (Letters, October 30),
urges the regulators to con-
sider ways In which Heath-
row's limited number of
slots can be used for Heath-
row's advantage.
Surely the question the
government should be ask-
ing is how can. Heathrow's
limited number of slots he
used for the advantage of
Heathrow and the country
From Prof Val Somonis.
Sir, Matthew Kaminski's
“Lith uania 's old heroes look
for new glory" (October 18)
correctly assesses the cur-
rent situation in that coun-
try but leaves something to
be desired in understanding
the past and future Lithua-
nian policies.
While there were some
populist streaks in some
Lithuanian non-communist
parties' pre-election rhetoric
(how else can you win elec-
tion in the sovietised soci-
ety?), the record of Lithua-
nian conservatives and other
non-communists speaks far
itself. Extending the pre-war
tradition of independence of
fiscal responsibility, Lithua-
nia recorded budget sur-
pluses in 1991-1992 which by
then were almost extinct
elsewhere. Also, it carried
out a speedy and radical
Czech-style, voucher-based
as a whole while causing the
least environmental damage
to London.
If this were the test, then
the government would
impose an environmental
cap on the number of slots
available at Heathrow at no
more than. 5 per cent above
the present figure and
ensure thaf slots or landing
charges were priced at mar-
ket clearing levels. In this
way Heathrow’s pre-emi-
nence in Europe would be
secured, London’s quality of
privatisation and property
restitution.
True. Lithuania was
slower to introduce the litas,
the permanent national cur-
rency, partly due to the mis-
guided influence of the Inter-
national Monetary Fund,
which argued fear the reten-
tion of the rouble zone as the
optimal currency area. The
new government is not plan-
ning to devalue the litas; it
talks rather about sustaining
the exchange rate.
The currency board intro-
duced by the Lithuanian ex-
communists la somewhat of
an inflation-sustaining insti-
tution under the conditions
of productivity differentials
in a dual (foreign versus
domestic sector) post-Soviet
economy, as it tries to
enhance its exports. A theo-
retical case for this assertion
is now supported, for exam-
ple, by the comparative
life would be rescued from
further deterioration caused
by Heathrow and the nation
(rather t han the airlines and
BAA) would benefit from the
huge additional revenue a
market pricing regime would
generate - estimated
recently by The Economist
at £500m ($8 15m) per annum.
Gideon Nellen,
Nellen & Co, solicitors,
19 Albemarle Street,
London WlX 3 HA.
UK
infla tion performance of
Estonia and Lithuania on
one hand and Latvia on the
other.
Therefore, an orderly
return to responsible mone-
tary policies under the clas-
sical central bank institu-
tion, planned by the new
government, will not only
help inflation-fighting. It will
also help Lithuanians
acquire macroeconomic pol-
icy skills which in turn will
speed up reforms.
In sum, the non-commu-
nist victory will only make
Lithuania more attractive as
a place in which to invest
Val Samonis,
professor of east-west
business and transition
economics,
University of Toronto,
Suite 14335,
130 St George Street
Toronto, Canada M5S 1A5
The living is
not made
any easier
From Mrs Lyn Glanz.
Sir, Richard Donkin shows
considerable naivety in ask-
ing “Now that we have a
Channel tunnel is it really so
different living in Brussels
as opposed to Edinburgh?"
(Recruitment. October 25) .
Greater accessibility to and
from continental Europe has
little to do with the daily
costs of expatriate life.
Such costs include vastly
Increased telephone and
travel bills and paying a pre-
mium for goods and services /
due to a lack of local know-
ledge and language. These,
however, can be dwarfed by
hidden costs arising from,
for instance, the reduced
availability of spouse
employment and additional
costs for the care for elderly
relatives left at home.
Experienced expatriates
know the costs of moving
abroad cannot be measured
in simple financial terms
and that each posting will
pose differing challenges
which are not necessarily
affected by proximity to
their home country.
Living overseas can signif-
icantly alter attitudes. 1 sug-
gest Richard Donkin's views
might be different had he
been writing his article as an
expatriate in Brussels.
Lyn Glanz,
C-N.A- Looslaan 40,
3054 BR Rotterdam,
The Netherlands
Lithuania attractive place to invest
Europa - Paul De Grauwe
The sorrow of Belgium
Complacent and
unaccountable,
the state faces
a crisis of
public confidence
Belgium
traditionally
lacked an
image. Coun-
tries such as
the Nether-
lands, Switzer-
land, Den-
mark, France
and Germany evoke pictures
that are easily recognised 'by
outsiders. Not so with Bel-
gium, where bourgeois vir-
tues have stood in the way
of strong images.
This Is changing quickly.
Belgium is gaining a reputa-
tion for corrupt politicians
and the incompetence of its
judiciary.
When it emerged in the
summer that several girls
had been kidnapped and
some murdered, some magis-
trates refused to start an
Investigation; others left for
prolonged holidays. Crucial
information that could have
led to the arrest of the perpe-
trators was not used or was
kept secret from other inves-
tigating agencies.
The murderer, who had
been convicted of child
abuse, had been freed in 1992
after only three years in jail
and immediately resumed
his macabre activities. Last
month, a popular magistrate
who uncovered the paedo-
phile ring was taken off the
case by the supreme court,
increasing suspicions of a
cover-up.
All these horror stories
have accumulated over the
past few weeks, leading to
massive protests which cul-
minated in a march through
Brussels by more than
300,000 citizens.
The popular protest has
spread beyond the case of
the missing and murdered
children to become an
expression of general discon-
tent about Belgian state
institutions. The perception
has grown that corruption,
incompetence and ineptitude
are the organising principles
of the political system, the
administration and the judi-
ciary. The Belgian state is
seen as failing to provide
essential public services
such as law and order and
protection for its citizens.
How could this happen in
the most bourgeois country
in Europe? The answer can
be summarised thus: compla-
cency and lack of account-
ability.
Mr Jean-Luc Debaene, the
prime minister, exemplifies
Belgian complacency. For
years he has told journalists
he will not attempt to solve
problems that cannot be
proved to exist. The judi-
ciary was one of these “non-
problems”.
This attitude also explains
why Belgium's government
debt is the highest in the
European Union. For years,
the problem was ignored.
One minister once declared
that, since the debt had
come about automatically, it
would disappear automati-
cally. No need to worry.
Just as complacency
explains the inaction of suc-
cessive governments, so lack
of accountability explains
the disastrous failings of the
judiciary. The separation of
powers between the judi-
ciary, the executive and the
legislative is a great idea.
After the absolutism of
medieval kings and popes, it
certainly helped make jus-
tice fairer.
It has, however, also made
it possible to develop a judi-
cial system that is com-
pletely unaccountable.
Unchecked by outside con-
trol, judges spend more time
fighting each other than
administering justice. Any
mention of supervision is
howled down as an infring e
meat of the sacred principle
of the separation of powers.
But pressure to reform the
judiciary has been mounting
after the recent disclosures
of its incompetence. High on
the list of proposed reforms
are plans to reduce the
excessive political influence
in the appointment and the
promotion of judges. This is
certainly overdue.
It will not suffice, how-
ever. if the bills introduced
in parliament are passed,
judges will have to pass an
exam in order to be hired or
promoted. But if. in the
name of the separation of
powers, these judges con-
tinue to be unaccountable,
little will have been
achieved. A procedure must
be developed to evaluate
their performance in admin-
istering justice.
The challenge is to
develop procedures that
make the Judiciary account-
able to the public without
infringing on its Indepen-
dence. This may sound
impossible; yet it can be
done, as the experience of
Belgium's university profes-
sors makes clear.
Professors used to hide
behind the principle of aca-
demic freedom to reject any
outside control on the quan-
tity and the quality of their
services. This is changing
slowly. A Belgian newspaper
now publishes yearly rank-
ings of economics professors
based on their publications
and citations.
The teaching performance
of professors is routinely - .
evaluated using surveys on-
students' satisfaction. What
was thought to be impossible
turns out to be quite feasi-
ble, and is changing the uni-
versity landscape.
Something s imilar should
be done for the judiciary.
Why not survey the satisfac-
tion (or dissatisfaction) of
the citizens who use the sys-
tem? One could certainly ask
the “consumers" questions
about the speed with which
trials were conducted and
about the responsiveness of
the judges to arguments.
In addition, it should be
possible to subject the qual-
ity of court rulings to out-
side expert control. Rank-
ings could be established to
give the public some idea of
the quality of different
courts of justice.
Other methods (and proba-
bly better ones) can be
devised. They are essential
to restore a semblance of
efficiency and fairness to the
Belgian judicial system, so
that the country can return £
to its happy state of having'
no recognisable image in the
outside world.
The author is professor of eco-
nomics at the University of
Leuven and MP for the
Liberal party in the Belgian
parliament
Street protest: the government of Jean-Lac Dehaene (inset)
has been under attack over the complacency of the state
IS
FRIDAY NOVEMBER 3 1996
1 *tf)l
hk : .
HVi| n
s'
ittlvJ
financial times
Number One Southwark Bridge, London SE1 9HL
Tel: +44 171-373 3000 Telex: 922186 Fax: +44 171-407 5700
Friday November 1 1996
A Japanese
arrangement
Mr Ryutaro Bashimoto. Japan’s
outgoing prime minister,
appears to have done <»r»r^ g >
deals to bring his Liberal Demo-
cratic party back to power as a
minority government, even if he
fails to win mare backing from
Independent members of parlia-
ment But the 10-point plan be
agreed yesterday with his for-
mer coalition partners - to
ensure their tacit support - foil s
well short of being the sort of
reform platform that many were
hoping for.
At its heart lie proposals for
bureaucratic reform, the one
issue on which ah the mai n par-
ties in the recent election cam-
paign were agreed. Thus over a
five-year period from 1998, the
number of government minis-
tries win *be reduced, with, pre-
cise proposals to be drawn up
over the next 18 months.
In addition, the parties have
agreed to review the electoral
system, reducing the number of
seats in both houses of parlia-
ment; to discuss tax reform; and
to seek to improve relations
with neighbouring countries.
It is scarcely a radical pack-
age. Reform of the heavy-
handed and cumbersome Japa-
nese bureaucracy is certainly
necessary. But it needs to pro-
ceed hand in hand with eco-
nomic deregulation, to reduce
the opportunities for bureau-
cratic interference. . Red tape
needs to be scrapped in & host
of vital areas, from financial
services to teleconmiunicattons,
and including the labour mar-
ket, housing, health and wel-
fbre. Reform is needed to ensure
more domestic competition and
more flexibility in the markets,
in order to revive the economy
from its worst slowdown in 80
years. But there is no mantim)
of such measures in the pack-
. age.
Given the recovery in the for-
tunes of the conservative LDP
in the elections, with an
increase from 211 to 239 seats in
the 500-member lower house,
some feared it would be too
strong to be bothered to press
ahead with reforms. In the
event it seems more likely to be
too weak. So ft will be up to the
opposition parties, such as the
left-wing Social Democratic
party, and the pro-deregulation
New Frontier party, to maintain
the pressure for action.
Use worst indictment of the
political establishment was the
record low turnout of 59 per
cent in the October 20 election.
It suggested few expectations of
genuine change, whoever came
to power. Mr Hashhnoto has a
reputation as a pro-active prime
minister, and he now has a
chance to prove the voters
wrong. He is due to be pres-
ented with a package of deregu-
lation plans by the advisory
Economic Council before the
end of November. He has much
to gain by rapidly putting them
into effect
Shark pool
A new generation of
high-pressure sales representa-
tives, using cold calls, is per-
suading gullible European
investors to put their money
into currency trading schemes
and shares of dubious value.
Many of the perpetrators
learned their- craft in some of
the infamous operations of the
1980s. Since then, cold- callers
have cleverly exploited new
technologies to evade the police
and financial regulators.
They have learned to shelter
in corporate mazes which take
maximum advantage of regula-
tory gaps and banking secrecy.
Investors are contacted by
cross-border mail shots or tele-
phone calls.
The companies’ bank
accounts and administrative
offices are in another country,
often Switzerland. Investors’
funds, once committed, are diffi-
cult to track or retrieve because
of banking secrecy and the
speed of electronic transfer.
Some complaints represent
only ffie disappointment of spec-
ulators who belatedly realised
the risks, or the fact that com-
mission structures were stacked
against them. But even when
fraud is suspected, there are dif-
ficulties or jurisdiction. Since
many companies avoid selling
into their local markets, there is
less incentive for police or regu-
lators to become exercised.
The EITs Investment Services
Directive, under which a com-
pany authorised in one country
will be given a “passport" into
all others, is intended to address
some of these problems. But
countries are implementing the
ISD at different paces and with-
out uniform definitions. For
example. “Rolling spot” deals
(forward foreign exchange con-
tracts of seven days or less,
which are rolled over), used by
many cold callers, are not regu-
lated in Germany.
The UK has made the most
progress in protecting investors,
partly because it has access to
tough civil remedies. It was the
first to regulate “rolling spot-,
although applications for per-
manent authorisation take too
long to be decided.
The Securities and Invest-
ments Board has shown that it
will act against foreign compa-
nies calling into Britain, even if
such actions are too late to help
the losers.
The UK is also right to insist
on the licensing of individuals:
companies can more easily
adopt new identities. Another
step would be to explore ways of
using public exposure, within
the limits of what is possible
under confidentiality rules, to
warn about sharp operators.
But apart from keeping a
tight rein on licensing, raising
public awareness of risk and
pursuing criminal proceedings
where appropriate, European
countries should not waste sym-
pathy on "victims". Once the
authorities have warned that
there are sharks in the pool, it
is for investors to decide
whether to take the plunge.
Software power
It is a cliche of the media
business that content is king-
Rarely has this been more evi-
dent than in the agreement ear-
lier this week to encrypt the
contents of the new generation
of mass- market recordings, digi-
tal video discs (DVDs).
Copyright owners - the Holly-
wood studios and record compa-
nies - refused to allow DVDs to
carry their products In pre-re-
corded form unless they were
• protected against piracy. After
dragging their feet, consumer
electronics manu fa cturers at
last agreed - but too late for a
full launch oE DVDs this Christ-
mas. A product the industry
I badly needs has been put back
: by up to a year. -
1 The growing power of content
1 over hardware was first evident
•two decades ago, when Sony's
Betamax video-recorder lost out
to JVC's VHS because the film
studios backed the latter. In
response, Japan’s hardware
manufacturers attempted to
become software producers too.
Sony bought Columbia; Matsu-
shita bought MCA. Both epi-
sodes proved expensively unsa-
tisfactory, and Matsushita has
now withdrawn.
Not only were the two Japa-
i nese parents unable to run their
knew software businesses well,
they were unable to take advan-
f iage of the costly access to the
L creative community that owner-
■ship provided. Jff they had lis-
tened properly to their new sub-
sidiaries, for example, they
would have been aware of the
seriousness of the DVD copy-
right problem earlier. And if
they had made themselves at
home in Hollywood, they might
have been able to negotiate an
earlier compromise.
This episode underlines the
consumer electronics manufac-
turers’ unenviable dilemma.
The experience of Sony and
Matsushita argues against try-
ing to mi* hardware and soft-
ware; yet without some influ-
ence over the software business,
they will increasingly surrender
the whip band on important
aspects of new-product specifi-
cations to the content-providers.
There is only one way out of
this box: the creation of a new
and compelling category of
hardware, one which software
producers have no alternative
but to endorse. Against that
yardstick, the DVD does not
measure up.
More plausible contenders are
interactive on-line products
such as WebTV. To break into
the mass market, however,
.these products will need much
greater innovation in hardware,
software and infrastructure
than we have yet seen. And in
- this market, just as much as m
DVDs, content will still play an
influential role. Consumer elec-
tronics remains a good business
- but not quite as good » «
was before content providers
woke up to their power.
COMMENT & ANALYSIS
Boris
Yottaif)
Anatoly
Chubais
Tatyana
Dyachenko
Bods ; % ; ‘Wacfimir •: Vfecffndr l ' f •;*
Moscow’s Group
of Seven
Chrystia Freeland, John Thornhill
and Andrew Gowers on the business
leaders shaping Russia’s future
E very January, an
extraordinary collec-
tion of politicians and
senior business lead-
ers from around the
world descends on the Swiss
resort of Davos to ski, eat, drink
and make deals.
Even by its own standards,
however, this year's World Eco-
nomic Forum was the backdrop
for a bargain of unusual signifi-
cance. Behind the scenes and
without the knowledge of other
participants, a small group of top
Russian businessmen fanned an
alliance that would reshape their
country’s future.
They agreed that a communist
victory in the summer presiden-
tial election had to be stopped at
all costs. To forestall such a
disaster, it was imperative that
President Boris Yeltsin's fading
fortunes be revived. One man,
they decided, had the talents for
the task: Anatoly Chubais, far-
mer minister, economic reformer
and architect of Russia's privati-
sation programme.
Their pact was more than the
beginning of Mr Yeltsin's politi-
cal resurrection and ultimate vic-
tory in July. It also established &
new centre of power in Russia,
uniting tycoons who typified the
country's new capitalism and
who had been savage rivals until
this year.
The same tight-knit group of
seven businessmen now meets
weekly and works closely with
Mr Chubais, now the ailing Presi-
dent Yeltsin's chief of staff Its
members portray themselves
quite openly as the main force
shaping Kremlin policy.
And the group has placed two
of its members - Mr Vladimir
Potanin and Mr Boris Berezovsky
- in important government posi-
tions. This week's appointment of
Mr Berezovsky, head of a sprawl-
ing business empire comprising
car dealerships, TV stations and
a bank, as deputy secretary of
the Kremlin's Security Council
consolidates the businessmen's
capture of power.
On Wednesday Mr Berezovsky
revealed far the first time in an
interview with the FT how the
business alliance funded Mr Yelt-
sin’s re-election drive to the tune
of about $3m. He described how it
appointed a lO-stroog campaign
team headed by Mr Chubais and
also containing Ms Tatyana
Dyachenko, Mr Yeltsin's daugh-
ter. And he explained why he and
his colleagues had concluded
they had to join the government
to protect capitalism in Russia.
“Before the elections, business
realised that if business is not
consolidated - If we are not
strong and decisive - we will not
have a chance,” he said. “It is not
possible to have this [market]
transformation automatically.
We need to use all our power to
realise this transformation."
Apart from Mr Berezovsky, the
group of seven comprises: Mr
Potanin, former head of Onextm-
bank and now first deputy prime
minister for the economy; Mr
Vladimir Gusstnsky, head of the
powerful Most banking and
media group; Mr Mikhail Khodor-
kovsky. president of the Menatep
financial and ofl empire; Mr Peter
Aven and Mr Mikhail Friedman
of Alfa Tbmir; and Mr Alexander
Smolensky of Stolichny Bank.
Tbeir six enterprises, according
to Mr Berezovsky, control about
50 per cent of the economy.
By the accounts of several of
their number, these men were
intimately involved in every step
of Mr Yeltsin’s re-election cam-
paign and. the subsequent politi-
cal manoeuvring. They engi-
neered the alliance between
President Yeltsin and Mr Alexan-
der Lebed, his presidential rival,
after the election’s first round -
without which, said Mr Berezov-
sky, the president would have
been “unable to win decisively”
in the second.
The businessmen's proposal
that Mr Chubais be appointed
presidential chief of staff was
also a logical one. The 41-year-old
former privatisation chief was
respected by the president; of all
Russia's young economic reform-
ers he had shown himself to be
the deftest wielder of power; he
believed passionately in the mar-
ket economy and was not over-
delicate about how - or with
wham - to secure it.
As important, the bankers
largely saw themselves as Mr
Chubais’s creation, since their
fortunes were founded on the
reforms he introduced. “My posi-
tion is very natural, ” said Mr
Berezovsky. “I am a product of
privatisation. That is why I am
so Close to Chubais’s mentality."
Now, together with the presi-
dent's daughter, Ms Dyachenko.
Mr Chubais serves as the busi-
nessmen's conduit to the sick
leader. “She is the most effective
channel to inform the president,"
said Mr Berezovsky.
During the elections, the busi-
nessmen further entrenched
themselves by ousting rival fac-
tions from the president's entou-
rage. First to go was the hardline
clan surrounding General Alex-
ander Korzhakov. Mr Yeltsin’s
former security chief and drink-
ing partner. “We had not only to
elect a president who would con-
tinue reform, but also to cut the
right wing and the left wing," Mr
Berezovsky said.
With victory secure, it was
time to dispense with Mr Lebed,
the unruly general who was, in
Mr Berezovsky’s words, “starting
unfortunately to destroy the
power”. He was sacked by presi-
dential decree last month.
At the same time, the group
was debating how to exercise its
power. In Russia’s infant market
economy, members decided, the
new moguls had to assume
authority in their own right. The
banks had to have their men in
government.
According to Mr Aven, presi-
dent of Alfa Bank, it was their
collective decision to bring Mr
Potanin into the government.
“He [Potanin] had the feeling
that one of the big bankers bad
to go there,” he said. “He had the
support of the other big banks."
The businessmen's reasoning
was stark. Even if the threat of
communism had receded with
‘It is very dangerous,
because we could
easily find ourselves
controlled by a new
nomenklatura.
They are getting
new privileges -
and eating increases
the appetite*
the July election, Russia’s future
as a flourishing and stable mar-
ket economy was for from secure.
Not only was the president
largely out of action pending
heart surgery; there was also the
risk of serious social unrest, with
wage arrears mounting and gov-
ernment finances collapsing. The
bankers - several of whom are
leading members of Russia's Jew-
ish community - feared they
could become the target of an
extreme nationalist backlash.
Mr Berezovsky said he thought
a nationalist shift was inevitable:
“The question is only what price
we will pay for it: an ocean of
blood or just a cough.”
The businessmen's answer is
now apparent They have assem-
bled a remarkable political
machine to entrench and pro-
mote the market economy - as
well as their own financial inter-
ests. They not only have signifi-
cant roles in the cabinet and the
Kremlin, they also control Rus-
sia’s two top television networks,
a popular radio station and a
growing number of national
newspapers - assets they are
happy to use to advance their
agenda.
“We and the group of Mr Gus-
sinsky were the first who realised
how the mass media could assist
the different steps we wanted to
take," said Mr Berezovsky. “If the
media had not been free or pri-
vate, we would not win elec-
tions."
The group of seven see them-
selves as an embattled elite pool-
ing their efforts to steer Russia
through a difficult transition.
Other important figures in the
country take a different view.
IVCr Berezovsky's appointment
th i s week has sparked vigorous
protests uniting the communist
opposition and Russia’s small
band of liberal democrats. Critics
say the businessmen represent
an unelected oligarchy whose
rise to power jeopardises the
country's chances of becoming a
democratic state with an open
market economy based on the
rule of law.
Mr Sergei Kovalev, a leading
human rights campaigner, said:
“It is very dangerous, because we
could very easily find ourselves
controlled by a new nomenklatu-
ra .. . They are getting new privi-
leges - and eating increases the
j ;v;?£' '-V
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three credit reflag? agencies, '&• £•
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poJb^c^rx^fe arrivpd with
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■ to fruok^i'a; JJalaysiaji motor ’ <
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wltK an SO per
M : The giadal movement erf ' " .
■ a-milfimatoe forward anStmday,
with- thP arrival
GesieraiMari& Balm/chief of 1
tto generaLstaff of the’; . .. ;• » :
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He’s. travelling ^to Britton for •
‘hefaeen-fffo ;
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Balza JtiarbotOT grtslge . '
agjmiwtthe;
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commander ofanartaferyx
group.. '
Uffletotowt .
reJatians^be^
and Buenos Aires, such as the
foct.that the two countries’
soldiers work together closely as
peacekeepers in Cyprus, and
until recently did so in Bosnia. A .
Royal naval vessel, HMS
Endurance, called last year at
Brands Aires and apparently
received a warm reception.
Thin mutual fl rt ml r ation
society might even reach the
highest possible plane - a polo
match between the two
' countries’ armed forces. Our
money's on the Argentines - . .
Dollars and sense
. ■ Farevre&frying pan, hello fire.
Serge Robert, the French banker
who has just been named
■governor of Bosnia’s new central
bank, might well consider
; adopting that as his personal
motto.
Bobert has the delicate task of.
. implementing the ffrwwrbii aide
of the Dayton peace agreement
aimed at re-undfstog the
country's two halves, under
which the bank should amass •
suffictoot foreign reserves to
^support a ctmunon currency.
The Mbelmn, Seh.and •
Groat-controlled parts now each,
have their awn currency, with
' tfae Peatodimark the only one .
. accepted across Bosnia.. / . ' :
. . Oh, and the frying pan? Robert
has jiost spedt the last.^fot
months as s^dor adviser to the
'governor og Haiti’s central bank.
appetite. This new nomenklatura
Is insolent and is not subject to
any rules."
Mr Grigory Yavlinsky, leader
of the liberal Yabloko party,
agreed: “Our new regime is
reproducing the characteristics of
the old system.” The new finan-
cial and media empires were
more than business concerns:
“The name is not just banks and
television: it is oligarchy and
mafia.”
The motives of the business-
men may be clear, but what puz-
zles many is what Mr Chubais is
up to. He has won enormous
respect in the west for his bold
market reforms and integrity,
and grudging admiration in Rus-
sia for his staying power in gov-
ernment But today, some of Mr
Chubais's oldest friends fear he
has made a Faustian bargain.
If so. he almost certainly
knows what he is 1 doing. Mr
Kovalev, a former dissident and
an MP for Russia's Choice, the
party Mr Chubais helped found,
recalls a conversation a couple of
years ago in which Mr Chubais
complained bitterly at^out leading
businessmen.
“They steal and steal and steal.
They are stealing absolutely
everything and it is impossible to
stop them,” he quoted Mr Chu-
bais as saying. “But let them
steal and take their property.
They will then become owners
and decent administrators of this
property.”
Mr Kovalev commented wist-
fully: “From my point of view
this is economic romanticism.
There is a view that the country
will become a market economy
and then everything good will
follow. Then there will be democ-
racy. In my view it is a very
dangerous mistake."
He is not alone in his worries.
Mr Yegor Gaidar. Russia's first
reforming prime minister in
1991-92 and a close friend of Mr
Chubais, voiced the fear in an
interview this week that the new
Russian brand of capitalism -
featuring intimate ties between
corporations and the state and
restricted markets - could be
fatally flawed.
“To tell you the truth, I dislike
it," he said. “I know from eco-
nomic theory that If you try to
restrict markets you create the
basis for enormous corruption."
50 years ago
' Nationalisation in France
. Newspaper reports to Paris
• substantiate recent rumours
of operational losses suffered
: by the principal enterprises
nationalised during the last 12
months. The position of the
- National Coal Mines
Cojporatron, which operates
all French coal mines,
..appears especially
unfavourable, its monthly
deficit being estimated at
Frs^ 00 , 000 , 000 . A
communique of the.Ministry
Of Industrial Production
admits that disbursements in
the tbfrd quarter of 1946
exceeded income by some
Frs.4 milliards of which Frs.2
milliards represented the cost
of State holidays and capital
re-equipment Suggested
remedies are an increase in
the retail price of coal by
approximately 22 per cent or
restoration of the
Government subsidy.
U-S. Lifting Controls
Rapid progress is being made
by the.U.S. authorities in
issuing the various edicts
necessary to terminate
Government controls on
comzbodity and food markets:
Resumption of futures trading
in wheatacd lard has been
sanctioned at Chicago, and
tea has-been Breed from ail
restrictions other than
general import .control.
16
LEGAL DEFINITIONS
commission n. os In European I ivtun we
must be at the bean of Zwtat we must be ox the
throat of (see Eunuceptics) 3 fee paid to on open.
vx ROW* ft MAW: BMP iph 0171*248 4282)
LAWYERS FOR BUSINESS
FINANCIAL TIMES
Friday November 1 1996
Swissair threatens to ditch stake in airline Tutsis
Sabena crisis averted tighten
• a . a hold on
as unions agree to cuts eastern
j
first err
*
THE LEX COLUMN
By Emma Tucker In Brussels
and Wffllam Had hi Zurich
A fresh financial crisis at
Sabena was averted yesterday
as trade unions agreed a cost-
cutting programme after
Swissair threatened to walk
away from its SFr260m (S207m)
investment in the Belgian
national airline.
Mr Paul Reutlinger. the
Swissair-appointed president
of Sabena. indicated that If
unions continued to disrupt
operations, the Swiss company
might write off its investment
in the company and even relin-
quish its 49.5 per cent stake.
He said that, if Swissair did
not get the hoped-for return on
its stake in Sabena, the man-
agement would decide not to
invest any more and “pull out
of the company”.
The threat receded after an
announcement that Sabena 's
management had reached
agreement with unions on a
draft accord to cut BFr2bn
($6Q0m) off wage costs. In
Anger over
work rule
Continued from Page 1
ensured such measures would
not be applicable in the United
Kingdom.
However. last March an ;
advocate general of the Euro- I
pean Court of Justice made a
preliminary ruling that the i
UK government's challenge of
the legality of the directive
had no foundation.
The final judgment is sched-
uled for November 12. In a
majority of cases, the court
has endorsed preliminary rul-
ings.
Mr Major plans to campaign
in the British general election,
expected next May, on a plat-
form that he will scupper the
IGC unless the directive is
“disapplted” in the UK.
The government will
attempt to delay the direc-
tive's effect in the UK by cit-
ing the need to prepare.
But it has agreed H will not
be seen to be breaking the
law.
Malaysia
Continued from Page 1
May bank, which will inevita-
bly compete with the new
entity'. But analysts said the
government, which has a sub-
stantial indirect stake In May-
bank. persuaded it to sell its 75
per cent holding in Kwong
Yik.
A proposed merger earlier
this year between the local
Pacific Bank and the Malay-
sian operations of Singapore's
Oversea -Chinese Banking Corp
has yet to be finalised.
return, management will come
up with another BFr2.7bn of
savings by increasing effi-
ciency between now and 1998.
Swissair's shares fluctuated
wildly In response to the day's
developments before closing
only SFrl weaker at SFr«85. d
Sabena's "Horizon 1998“ plan
was drawn up by Mr Reutlin-
ger as a way of saving Sabena
without alienating the unions.
His predecessor. Mr Pierre
Godfroid. resigned after unilat-
erally suspending all collective
job agreements - a move
which led to extensive disrup-
tion by ground and pilot staff.
Yesterday, unions represent-
ing Sabena workers agreed to
the terms of the plan, but
pilots staged a strike that
delayed some flights. They
wanted to signal their disap-
proval of the agreement but
said they did not envisage any
more action in the near future.
The savings would be
reached through a combina-
tion of a two-year wage freeze,
job cuts, changes to working
conditions, increased flexibil-
ity and internal transfers.
Swissair's fortunes .are
closely tied to the success of
its investment in Sabena
which it bought In May 1995.
Sabena is supposed to provide
it with a base within the soon-
to-be-liberallsed European
Union airline market.
But the investment has
failed to live up to expecta-
tions and is proving a chal-
lenge for Swissair's highly
regarded new management
team headed by Mr Philippe
Bruggisser. Swissair's shares
have fallen 27 per cent from a
peak of SFrl.345 this year.
Analysts believe it would be
very hard for Swissair to walk
away from its investment, in
spite of its threats, because of
its own heavy financial expo-
sure. In addition to taking a
stake, the Swiss carrier has
provided another SFrl 60m in a
loan to a consor ti um of Bel-
gian investors in Sabena.
World stocks. Page 34
Hashimoto clears
way for minority
LDP government
By WllGam Dawkins ki Tokyo
Mr Ryutaro Hashimoto seems
certain to be elected next week
for a second term as Japanese
prime minister, at the head of
a one-party minority govern-
ment.
Mr Hashimoto moved a step
closer to forming a govern-
ment yesterday when his Lib-
eral Democratic party finalised
a policy accord with its two
former coalition partners.
Members of parliament will
probably elect Mr Hashimoto
by a narrow margin at an
extraordinary session of the
lower house next Thursday.
The conservative LDP is likely
to govern alone, with its two
former partners offering par-
liamentary support on the
Issues outlined in the policy
accord.
That would make the next
government more coherent
than the previous disparate
alliance of conservative LDP
plus leftwing Social Demo-
cratic party and centre-left
New Harbinger party.
However, the position of a
one-party LDP government
would be so precarious that it
would be able to pass only
un controversial legislation.
That suggests a host of pro-
business proposals could be
delayed, including the lifting
of a ban on holding companies,
the break-up of Nippon Tele-
graph and Telephone and cuts
in corporate taxes.
Mr Hashimoto's progress on
bureaucratic reform win prob-
ably determine how long his
government will be able to
hang on to power.
The prospect of another
weak government contributed
to yesterday's 1.04 per cent
decline in the Nikkei 225 aver-
age to 30,456.66. It has fallen
2-34 per cent, or 491 points, in
the past two days.
Yesterday's accord commits
the next administration to a
10-point plan, the Tnarin high-
light of which will be propos-
als to streamline the number
of government ministries In
the five years from early 1998,
when the bureaucratic reform
proposals are due to be submit-
ted to parliament
The need to reduce the size
of Japan's powerful bureau-
cracy was the keynote of the
mni pfli g na of all the main par-
ties in the October 20 election.
The LDP fell just short of a
majority at the polls, winning
239 seats in the 500-seat lower
bouse of parliament
The most recent minority
government, under Mr Tsu-
tomu Hata in early 1994. lasted
just two months, the shortest-
lived in Japanese postwar his-
tory. Mr Hashimoto's next gov-
ernment is expected to last
longer than that, if only
because the current opposition
is more fragmented and disor-
ganised than was the LDP dur-
ing its year-long stint in oppo-
sition until mid-1994.
Editorial Comment. Page 16
tighten
hold on
eastern
Zaire
By Mlcheta Wrong in Nairobi
Tutsi fighters are on the verge
of seizing a swathe of e as ter n
Zaire, putting them In a posi-
tion to dictate terms to the
Zairean authorities.
The country’s undisciplined
and anarchic army seemed to
be heading for a humiliating
defeat yesterday as Tutsi
fighters advanced on Goma,
the capital of north Kivu.
Zaire’s president, Mr Mobutu
Sese Seko, is absent, under-
going treatment for prostate
cancer in Switzerland.
The Totals were r eported to
1 be in control of Goma airport,
a key access point for army
reinforcements from
and the centre of relief
operations for more than 1m
refuge e s .
The presence in the area of
the Hutu refugees, who fled
the 1994 genocide in Rwanda,
is deeply resented by the Tutsi
regimes in both Rwanda and
Burundi, which have been
under frequent attack from
extremists in their ranks.
To the south, Tutsi Bany-
amuleuge guerrillas took sev-
eral reporters on a 60-mlIe
tour of the area between Lake
Kivu and Lake Tanganyika,
demonstrating that a s tret ch
of land from the towns of
Uvlra to Kamanyola was now
In rebel hands.
Mr Laurent Kabila, of the
Alliance of Democratic Farces
for the Liberation of Congo-
Zaire - the name adopted by
the Banyanmlenge guerillas -
told a Reuters reporter his
men bad captured Bukavu,
capital of south Kivu, and
were mopping up resistance
by militiamen and former
Rwandan soldiers.
Analysts suspect the Tutsi
fighters in north Kivu may be
members of Rwanda’s army. If
this were proved, it would
lend weight to the theory that
a proxy war is being fought In
the region between the Rwan-
dan and Zairean armies.
Rwanda continues to deny
being behind the fighting,
describing it as an internal
Zairean problem and refusing
to take part in ceasefire talks.
As mortars and artillery fire
targeted the outskirts of Goma
yesterday. 115,000 Hutu refu-
gees from the camp of
Kahindo. 40 miles north of
Goma, were beading south.
Aid workers said they were
aiming for Mugunga, where
400,000 Hutns make up what
has been described as “the
biggest refugee camp in the
world".
Relief agencies, which this
week pulled their Interna-
tional staff out of south Kivu,
were on standby to evacuate
about 120 expatriate staff but
said that they were reluctant
to leave while their help was
needed by the numbers swell-
ing Mugunga.
FT WEATHER GUIDE
Europe today
There will be rain and showers
over most of the British Isles as a
frontal system approaches. The
rain will be particularly heavy in
Scotland. The Benelux and
Germany will stay rather cloudy
with rain or showers over
Germany. Most of France will have
sunny periods although the
Mediterranean coast will be sunny.
The Iberian peninsula and southern
Italy will have plenty of sun but
patches of cloud are expected m
northern Italy. The Alps will have
some showers. The Balkans are
expected to be sunny and dry.
Five-day forecast
More rain and showers are
expected over western Europe as
e series of depressions moves Into
the continent. Each disturbance
will be accompanied by strong
winds. High pressure will provide
plenty of sun over most of the
Mediterranean and over eastern
Russia.
TODAY'S TEMPERA?
L.v-v-- • . '-M
l> 4 . to •* ■' -
••*■*55283?^
jgJPpIg
■r -
p 17 JsS
\ ^
^ l<M
Jm
^ » HIGH
i Mpomd m •••
Warm front AjOl Cold front Wind speed bi KPH • y’X' ...
Situation at IS GMT. Ta mpoutu ros maximum for day. Forecasts by Metoo Consult at the Motherlands
Maxlmun
Balling
[air 13
Caracas
cloudy 30
Faro
sun 22
Madrid
sun 18
Rangoon
Cddua
EWfusJ
shower 14
Cardiff
show* 14
Frankfurt
rain 14
Maferoa
sun 20
Reykjavik
Abu Dhabi
sun 31
Bolgmda
fair 13
Casablanca
sun 22
Geneva
cloudy 14
Malta
3U1Z1
Fte
Accra
show* 32
Berffn
rain 13
Chicago
cloudy A
Gibraltar
sun IS
Manchester
ram 15
Romo
Algiers
SWi 22
Bermuda
fair 25
Cologne
rain 13
Giesgow
ram 15
Manila
show* 31
S. Fraco
Amsterdam
cloudy 13
Bogota
show* 10
Dak*
aun 32
Hamburg
rain 12
MsflXJurrre
fair 15
SeoU
her ia
Bombay
s*i 32
Dates
cloudy 14
HdWrW
rain 8
Mexico City
fab 24
Singapore
Atlanta
sun 27
Brussels
far 13
DeM
swi 31
Hong Kong
fair 29
Miami
fair 30
Stockholm
3. Aires
ft* 23
Budapest
fair 10
Dub*
sun 31
HorvhJu
ft* 30
Milan
fair 16
Strasbourg
ram 15
show or 11
Dublin
show* 15
latartAd
fair 14
Montreal
shower 4
Sydney
show* 34
Cairo
sun 25
Dubrovnik
show* 17
Jakarta
far 32
Moscow
fair 5
Tangier
Tel Avtv
sun 18
Cope Town
3*i 23
bdlnourgn
rain 14
Jersey
fair 15
Munich
rain 18
Karachi
sun 32
Nairobi
fair 29
Tokyo
Kuwait
sun 34
Naples
srfi 17
Toronto
No other airline flies to
more cities in
L. Angeles
Las Palmas
sun 19
sun 26
Nassau
New York
fair 29
ckwdy 6
Vartcouver
Venfca
Eastern Europe.
uma
fair 21
Mce
*4119
Vienna
sun 20
Nicosia
show* S3
Warsaw
) Lufthansa
;
London
Lux-bourg
far 16
cfoudy 12
Oslo
Parle
ft* 9
fair 15
Washington
Wellington
Lyon
Madeira
lair 18
sun 24
Penh
Prague
cloudy 27
fair 11
Winnipeg
Zurich
shower 33
snow -8
shower 28
sun 20
sun 21
fa* 17
shower 33
rain 5
shower 15
tab 21
sun 22
sun 24
shower 22
fair 6
swi 12
Mr 14
show* 12
rain 8
cloudy 12
cloudy 12
cloudy -3
show* 13
All of these securities hove been sold This announcement appears as a matter of record only.
MINORCO
Minorco (U.S.A.) Funding Inc.
$ 400 , 000,000
Guaranteed Notes
Series A Notes due 2006
Series B Notes due 2011
Series C Notes due 2016
Guaranteed by
Minorco 8 A.
The undersigned acted as private placement advisor
on this transaction
JPMorgan
October 1996
t ,
Js f
. -A.
>■ :-.'v
...S'
- I- . ^
. . r .l • V .
’ i>s / r :
FBVANCIAJL TIMES
FRIDAY NOVEMBER 1 1996
' •. s t
. \7 ' h- “
R icardo Semler
breezed Into the
aiuinal conference
of the Institute of
Personnel and Development
to Harrogate last week;
enlivening a programme
dominated by the colourless
language of new manage-
ment.
Semler, president of
Semco, the Brazilian indus-
trial products manufac turer,
was visiting the UK to pass
on the recipe for his own
style of management In feet
it was more like an antidote
to management because
Semler spends very little
time managing. Most of his
work is spent' lobbying man-
agers among the g*n«m satel-
lite units of not more
about 10 people which, char-
acterise a growing propor-
tion of the company.
Some of hi« ideas axe
adopted, some are not Suc-
cessful business ideas also
emerge without Ms contribu.-'
tioo. One idea that led to the
creation of a business pro-
viding management far oat-
sourcing programmes con-
tributed 50 per cent of the
group profits within two
years of its formation. “The
concept was something 1
didn’t understand but others
did,” said Semler.
Richard Donkin meets a Brazilian who believes that freedom at work is a recipe for results
Welcome breath of laisser faire
His views on employment
axe radical. “Every company
needs lazy employees,” he
said in a typically provoca-
tive statement He believes
Hat working should reflect
the way people behave out-
side the office. Not everyone,
he argues, Is imbued with
the same approach to work.
Teams, however, can feed
and prosper irom a combina-
tion of styles.
Semler has no idea how
many people work for the
company or how rmirh they
are paid. Many of them set
their own pay rates. “Why
debate salary? We all want
to make as much, as possi-
ble,” be said. Employees are
provided with the informa-
tion to settle their own pay -
they know what the market
pays, how much colleagues
earn inside the company
how much money the com-
pany is making. When estab-
lishing their pay rates, says
Semler, employees know
that six months later a
department may no longer
want to buy their work if
they have priced their ser-
vices too highly.
Two out of three people
who work on the premises
are self-employed or work on
contract for another com-
pany. They can use the hard-
ware and telephones just the
same. Sender’s laisser faire
management seems to work.
Sera co has grown nine-fold
In the last 10 years to
become one of Brazil's lead-
ing companies in this field.
His idiosyncratic formula
is based, he said, on a simple
premise that the most diffi-
cult thing in business is to
get .people interes t ed in their
work. “Everything else -
quality, profit growth - will
fen into place if enough peo-
ple are interested in coming
to work on Monday morn-
ing,” he said.
Semler began frfo approach
to the business by asking
“childish questions’* such as
“what happens if someone is
not there at certain time?"
Some in his company
believed that if there were
not fixed working hours peo-
ple would come as late as
possible and leave as early
as possible. Semler believed
differently. “People go to
work because they are
looking to do something
with their life. I have never
met anyone who goes to
work for the money. In the
same way I have never met
any h nsfn & qoman who is In
business to make money.”
He refuses to be paternal-
istic or to set any kind of
company culture. Culture,
he argues, is a dynamic that
is constantly changing.
Employees can wear what
they want at work. OK.
All the businesses work on
six-month cycles when peo-
ple may change jobs or be
removed from their jobs if
they have not performed.
Each individual must justify
his place in the team - even
the head of the team - to his
colleagues. Job rotation is
encouraged.
When someone is recruited
they are given a blank card
on which they can write
their own title. Most do not
opt for a title although one
operations manager, said
Sender, decided to call him-
self “Royal Pharaoh in
charge of operations”.
He rejects the suggestion
that the business is anar-
chic. “Everybody knows
what they are doing there,
why they are there and how
they are contributing to the
final result” The three cor-
nerstones of his approach
are employee participation,
profit-sharing and . open
information systems. He
said: “Participation gives
people control of their work,
profit-sharing gives them a
reason to do it better and
information tells them
what’s working and what
isn’t”
The most refreshing aspect
of Sender’s approach in a
business world that is
becoming wedded to process
is that it is not prescriptive.
The result, he says, is that
“we have ended up with a
company that is self-
propelled".
Russia beckons
The extent to which head-
hunting firms have been
penetrating the growing cen-
tral and eastern European
markets for executive
recruitment is apparent in a
report* published this week
by the Economist Intelli-
gence Unit The report, com-
piled by Nancy Garrison
Jenn, shows that Russia has
the greatest potential in the
region, forecast to grow by
25 per cent in 1996.
Hungary and the Czech
Republic are now considered
to have mature and sophisti-
cated search markets, jointly
worth between SlOm and
$i2m a year. Headhunting in
Poland is worth about Siam,
with forecast growth of 20
per cent in 1996. As the chart
shows. H. Neumann of Aus-
tria is the clear market-
leader in the region with
nine offices earning more
than SIGm in net revenue in
1995. Ward Howell, of the
US, the pioneering firm in
Moscow in 1993, has main-
tained a leading position, in
second place among the rev-
enue earners in the region.
The report estimates that
headhunting worldwide is
now a $5bn to S6bn busine s s.
just under half of which in
Europe- The 30 largest inter-
national search firms had
worldwide revenue of $1.6bn
in 1995, 23 per cent more
than in 1994. Their combined
worldwide sales are expected
to double by 200 0.
‘Executive Search in Central
and Eastern Europe,
choosing and using a head-
hunter. Nancy Garrison
Jenn. is published by the
Economist Intelligence Unit,
15 Regent Street , London
SWJY 4LR. id 0171 830 1007
C or New York tel 212 554
0600). price £165/3265.
Top to headhunters in eastern Europe
Europe by
LeocSng executive seven Runs in central and eastern
number of office* and net revenues 1905 „„
Net
No of
offices
Central «.
eastern
Eropa
World
■ - A 9. •-
■ . 9.0
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Ward Howafl
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73.0
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7
3.1
120.7
Ao 6otd. t y
9
9.9
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Egon .Zahndar
A
2.8
146J3
5
£.0
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Traraaoroh
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Spencer Stuart
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Media & Telec ommu n ic ations -
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Our client i» a world feeder in the provision of investment
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Openings exist at Executive and Manager level and will
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BADENOCH tL CLARK
recr ui t men t specialists
Credit and Risk Analyst
The Bank of Newr York has the following excellent
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Excellent growth and exciting future prospects have created a
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The successful candidate will be responsible for planning.
conducting and ensuring effective conviction of nsk ha*ed operational
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Your profile is likely to be one of tbe following:
Managers - probably a qualified accountant with a minimum
of five years within an audit, advisory or consultative capacity
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detailed CV staling current remuneration to 25 Bedford Street, London
WC2E9HP. fax 0171 915 8714.
E-ntail; <favhtbcpon*i Q bqt w ahcaicoai or mje h acLC Ui ta^robertwalteracoin.
All applications win be treated In the strictest confidence.
h v o
5 ~
INDIO*
NSW VO*
AMS TERDAM
SCUSSELS
<• v„ D N t T
THE
BANKOF
NEW
TORK
Gigli, Personnel Officer, The Bank
of New York, 46 Berkeley Street,
London. W1X 6AA.
Equal Opportunity Employer
Appointments
Advertising
appears in the UK
edition every
Monday,
Wednesday &
Thursday and in
the International
edition every
Friday
For further
information
please call:
Dominic Knowlson
+44 OL71 873 4015
MCKmSFT 8c COMPANY is an international management consulting firm with 67 offices In 35 countries, serving the leaders of large organizations on matters
of strategy, organization and operations. Our mission is twofold: to help our clients make positive, lasting and substantial improvements in their performance
and to build a great Firm that is able to attract, develop, excite and retain exceptional people.
McCnsey’s Pulp and Paper Practice is one of the industrial sectors within our firm. The practitioners bring a rich body of skills, resources and experience to
tbe pulp and paper companies around the world. Tbe Pulp and Paper Research and Information Professionals from Sca n di na via. Brussels and Atlanta assist
the consulting teams by collecting/analyzing information and conducting research. The Brussels location is now looking for a (m/0
cT
m
Oi
6
o
tj
&
KJl
• H
u
s
I**
PULP AND PAPER. RESEARCHER
The Pulp and Paper Researcher wifi handle research and information requests - generally requiring between one hour and a few days
to complete - concerning all aspects of the industry chain from forest co converted paper products.
The ideal candidate will have completed a university degree in economics or a related field, be between 25 and 30 years old. and have:
• Stare of the art understandi n g of the paper industry dynamics and papermaking process.
• Strong interest in collection, management and analysis of information.
• Proven ability to synthesize information
0 Excellent communication skills in English. French and German skills axe an asset.
• Hands-on computer skills (spreadsheets, on-line information retrieval, fin an c ial analysis packages).
• Quick and creative mind.
• Willingness to take initiative and responsibility.
• International orientation.
if you fit this profile and you would like to apply, you are Invited to send your curriculum vitae before November IS. 1996 to
Anne-Marie Matron. Recruiting Administrator - McXSnsey k Company, Inc. - avenue Louise 480, B 22, 1050 Brussels.
Corporate Finance
Executive
3i Corporate Fnjanoe is the 3i Group's Corporate
Finance advisory division, which specialises m
mergers and acquisitions and provides Corporate
France advice to the Group's investment division.
3 i Corporate Finance is seeking to recruit an
ambitious profession*! to join their expanding
London team*
This is an excellent opportunity for a
commercially aspire Chartered Accountant or
Solicitor keen to move into corporate financ* or
for a candidate who ha* already obtained corporate
finance experience and wishes to progress hw/her
career-
The successful candidate will work on
variety of transactions in the public and private
company arena- The executive will *0
require sound commercial judgement.
London
negotiation and interpersonal skills combined with
good technical expertise. Additionally candidates
must also be able to demonstrate:
• Excellent academic background, 2:1 degree or
better from a leading university. .
> The ability to liaise with entrepreneurial clients
at a senior level.
• Strong analytical, technical and communication
skills.
• Initiative, creativity and maturity.
If you art a commercially minded and ambitious
young executive wishing to progress your career
you should contact either Annabel Carmichael or
Paul Wilson on 0171 269 2318 or write eo them,
enclosing a full curriculum vitae at Michael Page
City, Page House, 39-41 Parker Street, London
WC2B SLH- Fax: 0171 405 9649.
Please quote reference 261906.
Michael Page City
Int— iarional Reertrfuagu CouwihmW
v^^P»rf»F™Ato H»u^KoogStaWoro Sydney
Corporate Finance - Lebanon & Levant
INVESTMENT BANKER
vi* IScirul. Lebanon
S( 'om pel i I i\ e
Ad outstanding investment banking opportunity with a pre-eminent financial institution. Our Bank is recognised
for its SI billion capital base and experience spanning corporate and investment banking, private banking and a
presence in major investment centres. We are seeking an individual to help build a Beirut based investment
banking operation in private and public Issues of debt and equity products. The individual will enjoy the
Challenges and rewards associated with an expanding operation in an exciting emerging Levant.
The Position
■ Secure and execute mandates for raising debt or equity capital, private placements and project financing
■ Support the marketing and client development efforts of the Bank in Lebanon and tbe Levant
■ Help attract and develop junior professionals to the team
■ Assist with building a long term investment business
The Requirements
■ Personal and professional commitment to tbe evolving reforms and reconstruction of Lebanon, and a
conviction favouring tbe growth of the Levant and die Mideast as an emerging market
■ 3-4 years US or European experience at recognised investment tranks, and an MBA from a leading university
■ Demonstrable track record with corporate finance transactions, debt or equity, or M&A
■ Highly numerate, analytical, technology literate and transaction oriented
■ Self starter with drive and ambition, and a desire to live in Lebanon
■ Knowledge of French and Arabic an advantage
Interested candidates should send their CV’s together with details of current compensation to:
Box A5734, Financial Times,
One Southwark Bridge, London SE1 9HL
II
FINANCIAL TIMES
FRIDAY NOVEMBER I 1996
Package to attract
the best
GE Capital
Commercial Finance
Business Origination Director
Highly Influential new position with a mandate to build a significant business la Europe. GE Capital has
assets of c. $135 billion worldwide aod Turnover of c. SJ.4 bilUoa. It is active in 26 different financial
services businesses and European operations are a principal focas for rapid growth both by acquisition and
organically. Its Commercial Finance business group aims to deploy Its highly snccessfbJ range of US
products and services spanning asset-based and cash flow lending, capital markets placements, receivables
and export Jutandng, and equity and debt Investing. The Group has an appetite flrr arranging major
commercial financings both bilaterally and in syndication. This position will have access do very
substantial resources.
THE QUALIFICATIONS
■ Outstanding, high achieving commercial finance
professional with a distinguished business
development record of asset-based financing in a
blue-chip bank. - probably now at Director level.
■ Authoritative origination and transaction experience
In building a substantial book of commercial finance
assets. Well - developed analytic and credit skills with
relevant languages and European experience.
■ Entrepreneurial, self- motivated and Imaginative
ream player with stature, commercial focus and
obiectivity. Able to represent GE Capital effectively In
a broad range of transactions.
THE ROLE
■ PAL responsible to the MD international Division m
the US for the origination and execution of
Commercial Finance's business development
programme throughout Europe.
■ Targeting relevant public and private companies and
leading derailed corporate lending negotiations
principal to principal Recruiting and developing a
small dedicated team of transactors.
■ Forging strong relations both Internally and
externally to identify opportunities and synergies for
the Group as a whole. Developing complementary
products and services.
Leeds 01 19 2907774
London 0171 493 1235
Manchester 0161 499 1700
Selector Europe
Spencer Stuart
Mr ITT ixyfy wtt fan aenlls m
5»l»ranr Europe. UC IXISIOCL
ii on rfai ii
Package to attract the _ .
l?„ t U s^& r Blabal Project & Structured Finance
GE Capita /
Europe
Business Development Director
GE Capital GPSCIs one of the largest providers of project and structured finance In the world. Its
office (and Its satellite in Odhi) services activities in Europe, Middle East, Africa and Central Asia an t
has recently made equity and debt Investments In S multi-billion energy, infrastructure end telecoms
prefects within lie region. It now wishes tb appoint a top-flight professional to spearhead the
development of opportunities across a broader product and project base. The group has a large
appetite as a principal Investor and access to very substantial resources.
THE QUALIFICATIONS
■ First-class, experienced structured financier with
relevant origination and transaction experience in
the region. European language skills highly
desirable.
■ Excellent commercial and analytic skills, ideally
with a broadly based exposure to mlecoms and
infrastructure projects. Trip quality training and
transaction experience whether from a developer,
major Investment bank or boutique.
■ High levels orinitialive and energy with the stature
and style to represent GE Capital at the highest
levels. Tenacious deal maker with appetite far a
real challenge.
THE ROLE
■ Reporting to the Managing Director Gpsf in
London with the remit to identify, structure and
help close major transactions.
■ Develop existing and new relationships with
major operators and corporations to identify
opportunities for equity and senior and
subordinated debt Investments.
Writing with a small dedicated team to build
GPSF's profile and reputation within the region.
Key contributor to strategy.
Leeds OI 13 2307774
London 0171 493 1238
Manchester 0161 499 1700
Sel ector Etiroj^e
Spencer Mu. in
Pleas rapty wUti tod deoil* ik
S elector Europe, Ret noitiau.
J
INVESTMENT BANKING CREDIT RISK MANAGEMENT
As one of the worlds leading and most prestigious Investment and Commercial Banks, our client has an enviable reputation for being at the forefront of product innovation and development, whilst maintaining the
integrity of its highly valued credit culture. The Credit Risk Management function plays a vital role tn developing credit policy and portfolio management techniques, in addition to providing an overview of the Bank's
group credit process. As part of its ongoing commitment and development of this key area, the Bank now seeks to make the following appointments:
SENIOR ANALYST
Responsibilities
• Credit risk management of cash and derivative products;
• Credit risk analysis of exotic and structured transactions;
• Credit risk analysis of derivatives portfolios;
• Analysing the effects of credit provisioning on derivatives
exposure.
ANALYST
Responsibilities
• Credit risk analysis of trading counterparties to include -funds,
fund managers, brokers, dealers and Investment Banks;
• Legal risk analysis of derivatives documentation;
ANALYST OPERATIONS
Responsibilities
• Analysis of settlements channels for cash, securities and
derivative instruments;
• Credit risk analysis of both safe settlement and electronic
banking payment channels;
Development of credit policies for settlement risk.
\
Co-ordination of credit policy for front office and credit risk
management areas.
It is envisaged that over one these positions mill develop to cover additional areas which will possibly include: the participation m the development of RAROC; evaluation of economic capital : and the analysis on a
transaction/portfolio basis of emerging markets business.
Candidates will be ambitious, career orientated University graduates , preferably with a maths or science degree, who will have gained 2-3 years relevant credit risk experience within an active player m the Investment
Banking marketplace. If you feel ydu have the necessary skills and experience to contribute to this specialist group, and wish to play an important part within this Head Office function please contact, m strictest
confidence, Sean Carr or Richard Lyons.
Tel: 0171-588 3322 ^xrv%Tn ± Wamford Court
29 Throgmorton St.,
London EC2N2AT
Fax: 0171-628 2400
j CARR-LYQNS 1
Search & Selection Limited
r
EXCELLENT REMUNERATION PACKAGE
BASED IN LAUSANNE. SWITZERLAND
FISCAL AFFAIRS MANAGER
THE COMPANY Philip Morris is the world's largest consumer packaged goods
company. Our EEMA regional headquarters, based in Lausanne, oversees our
growing cigarette business in the countries of EFTA, Central and Eastern Europe,
the Middle East and Africa.
THE POSITION Working independently, you will provide back-up for die Director
Economic and Fiscal Affairs in the development and support of EEMA taxation
objectives as applied in an FMCG environment. This will essentially involve providing
Management with expertise on import/customs duties, excise taxes and trade-related
issues, developing the relevant taxation strategies, and the presentation of recom-
mendations.
THE PERSON A holder of an economics or other business-related degree, ybu have
some 8-10 years relevant experience, a few years of which have been spent in a
similar position. In addition, you possess excellent analytical and communication
skills, together with the ability to work independently and to synthesize complex
issues. Fluent in English (French or a Slavic language would be an asset), you are
prepared to travel.
If you feel that you match our profile and are interested in joining this dynamic team
of professionals, please reply in the stnetest confidence with full ojmcuJum vitae, .
covering letter and details of current remuneration package, attaching^ brief written
description of an event or incident in relation to a specified task or process in your
professional life where you feel you performed very wed and the outcome was
successful. Send your application to:
PHILIP MORRIS
EEMA REGION
PHILIP MORRI5 EUROPE SA - EEMA REGION
RESOURCING CENTRE REF. NO. 17.10.96 AMS
AVENUE DE COUR 107
PO BOX 1171
1001 LAUSANNE, SWITZERLAND
Successful Careers Worldwide Closing date for receipt of applications is 1 1 November 1 996
CJA
RECRUITMENT CONSULTANTS GROUP
2 London Walt Buildings, London Wall, London EC2M 5PP
Tel: 0171-588 3588 or 0171-588 3576
Fax No. 0171-256 8501
Outstanding opportunities at the forefront of new risk financing developments arising from the
convergence of insurance and banking. Developing and marketing products and innovative solutions
through sophisticated risk advisory services.
CJA
CONSULTANTS
CAPITAL MARKETS RISK FINANCING
£45,000-£80 y 000 + SIGNIFICANT
PROFIT RELATED BONUS
LONDON
NEW YORK AND HAMBURG
THE OPPORTUNITY TO JOIN A CONSULTANCY PARTNERSHIP RECENTLY FORMED WITHIN A
GLOBAL INSURANCE GROUP
We invite applications from graduates who will be professionally qualified and/or with a second degree, who must
have had at least S years’ financial sector experience within the insurance industry, a bank or corporate treasury in
derivatives or new product development. The selected candidates, who will report to a senior director and be part
of a highly qualified and motivated professional team, will be responsible for providing a specialist consulting service
no major industrial, commercial and insurance clients by developing and marketing new risk financing products.
Significant overseas travel should be expected. Essential qualities are numeracy, strong analytical skills plus the drive
and personality to make professional presentations at board level and the creative flair to develop client
relationships through a consultative approach. Initial salary negotiable in the range £45,000 - £80.000. plus significant
profit related bonus, car, non-contributory pension, life assurance. PHI, private medical cover - for candidates with
particularly relevant experience a higher base salary may be paid. Applications in strict confidence under
reference C5854/FT to the Managing Director, CJA
Appointments Advertising
appears in the UK edition every Monday, Wednesday & Thursday and in the International edition every Friday
For further Information please call: Robert Hunt on +44 0171 4095
Equity Markets Editor
Leading Investment Bank
Excellent Package + Bonus
City
Opportunity for an equity markets’ editor or financial journalist to join
a major stockbroker, part of a leading UK investment banking group.
THE COMPANY
♦ Highly -effective, prestigious broker, one of the
largest equity houses globally.
♦ Highly rated in UK and international equity
research.
♦ Strong commitment to research. Reputation for
quality and depth of cover.
THE POSITION
♦ Senior member of pan-European editorial team.
♦ Close contact with analysts. Edit written
investment research ideas for external and
internal use.
♦ Input into development of written product and
research marketing and distribution.
QUALIFICATIONS
♦ Successful editor either within leading broker or
experience in financial journalism. Alternatively,
an equity analyst.
♦ Thorough and rigorous analytical mind. Able to
write in depth.
♦ Team player, ambitious for success.
♦ Commercially aware and good communicator.
Please send full cv, stating salary, ref FS6I0A2, to NBS, 10 Arthur Street, London EC4R 9AY
NB SELECTION LTD
j BNB Resources pic oompmy
NBS
dry 0171 423 1520 • London 0171 493 6392
Aberdee n ■ Bir ming ha m • Bristol • City
Edinburgh • Glasgow • Leeds • London
Manchester • Slough * Madrid ■ Paris
Head of Derivatives
Securities Operations
AM ERIC AN
EXPRESS
BANK
American Express Bank Lid is a
major US bank u>itb a presence
in 36 countries worldwide. We
are a trusted partner for wealthy
entrepreneurs and local financial
service institutions. Our principal
businesses are correspondent,
commercial and private banking
and consumer fi na n c ial sen-ices.
American Express Bank Ltd is an
Equal Opportunities employer.
Poole, Do us ft
American Express Bank Ltd is recruiting a Head of Derivatives and Securities Operations for
its regional headquarters based in Poole, Dorset. This centre provides operational support to
AEB offices worldwide for business areas including treasury, securities and derivatives.
This position carries significant responsibility and reports directly to the Poole Operations
Head. It is intended due this individual will play a key role in the continuing development of
global support services for treasury, securities and derivatives.
Candidates will have at least 10 years experience of treasury, global derivatives and securities
operations gained within International Banking. Experience should include the management
of an operations ream with particular emphasis on people management, training and
development, and teamwork. Additionally, applicants must demonstrate a proven track
record in change management and systems development, and be hunilar with a control
orientated environment
The remuneration offered is highly competitive, reflecting the importance of this position
within the bank, and includes generous relocation assistance.
Inte r es t ed applicants should write with their cv, in confidence, to Helen Higher, Managing
Consultant, ar the address below.
Jonathan Wren & Co Limited, Financial Recruitment Consultants, No. I New Street, London EC2M 4TP
Telephone 0171 623 1266 Facsimile 0171 626 5257
P3028S
FINANCIAL TIMES FRIDAY NOVEMBER I
Debt Origination Manager - Africa
Excelijbot.Package
Our client, a wen -respected Global- Bank with extensive
interests m emsgqg nartets, is seeking an outstanding
indivitfcal to strengthen their coverage of the Afiican region.
Woddug as a sauor member of a specialist fee
soccessfiU applicant wiD be instramental in btriMing long tenn
relationships with a range of Aincan Sovereign, Corporate and
Institutional clients. The position demands an iiwkp*
understanding of investment banking and candidates with a post
graduate qualification in either International Banking and
Finance or a related discipline would be of particnlar inoresr.
London Based
C a ndidates should have at least five years experience of
dealing in tie region and possess an extensive network of senior
contacts within the African financial community. A strong
understanding of local business practices and regional cultures
are also considered to be important attributes.
Interested candidates are invited to submit their Curriculum
Vitae to Andrew Warfnmon, Director; MW Selection.
5 St Mm’s Lane, London, EC1M 4BH, or call him for a
confidential discussion on Telephone; 0171 250 4710,
Facsimile: 0171 251 464$.
MW
►
Investment Banking
in Emerging Markets
Highly Attractive Salary + Bonus
We represent a rapidly expanding international London based bank with an established presence
in Western and Emerging Markets.
Due to its continued success, the organisation is looking to expand its Investment Banking team
with the appointment of a Senior Market professional. Suitable candidates will possess a degree
possibly coupled with an MBA and have at least three to five years experience in all aspects of
debt issuance. Ideally exposure would encompass Emerging Market debt but this is not
essential. You should, however, be able to demonstrate an excellent track record of originating,
structuring, documenting and distributing banking and corporate debt issues.
The ideal candidate will have exceptional presentational skills and be willing to travel to secure
and complete mandates. This is an outstanding opportunity to play an integral part in the
development of a highly successful business.
For a confidential discussion please contact David Reynolds >
Tel: 0171 236 2400, Fax : 0171 236 0316 or apply in writing to
Sheffield-Haworth Limited, Prince Rupert House. 64 Queen Street, London EC4R 1AD.
SHEFFIELD-HAWORTH
Consultants in Search and Selection i 55 »■■■■■■—
Chief Dealer FX Options
SIX FIGURE BASE
LONDON
A challenging, high' profile role offering the opportunity to establish and manage the FX Option trading activities of a leading
bank, covering the European time zone as part of the Global Operation.
Vbu will be joining an established and successful Treasury which has a strong reputation in trading and enjoys excellent
relationships with the corporate community.
The positron
• Set up and manage an Options Trading Desk in a dynamic
environment.
• Quote major and some minor currencies on an Interbank
bash and provide prices for customers.
• Develop the company's profile in OTC Options through
building relationships and market making.
• Promoting OTC options products within the organisation.
The Requirements
• Proven trade record with a minimum of 5 years experience
in OTC Currency Options trading.
• Experience in a wide range of currencies for vanilla and
exotic options.
• Ability to work in conjunction with the salespeople and
offer added value on Option products.
• Experience of setting up a desk would be a distinct
advantage.
Please contact Jmes And e rso n in the st r ictest confidence.
Search and Selection, 2 Austin Friars, London EC2N 2HE
Tefc 01 71 -972-01 50, Fax: 0171 -972-01 5T/2- BmaiL- [email protected]
BARING ASSET MANAGEMENT
Quantitative specialists
Excellent Salary & Benefits
- Baring Asset Management is part of the ING Group and provides a full spectrum of
investment and administration services for an' international client base.
Two new positions have arisen for quantitative experts to work, in out investment
teams. These tales are central to our investqfaht process.
' ' /• & ' • !.• ?■*.
QUANTITATIVE MANAGER
Your brief adfLbe'jcp build/' dj^ op and manage the qt^brative process within our
European iTrfcstrnen c.'^eam . WoAhag .closely with the resr of cbd- seam; you will take
responsibility management of European equit&*nd QvtiSce its effective
imple3iae»xadoten^ari^>c investment piOCesa Ar 3fea« three yeW quantitative management
of equities is iwjgridr ' j ‘
QUANTIT^tlVE - ANALYST?" ^
You will join an established, small successful Japanese quantitative team in order to
develop further th?<ht|(es6pent screening process. Experience M. Equities would be an
advantage but is not «ss^{|aL The ability t© . work with, the minimum of supervision and
ro formulare and reseatah^e^kjtas is essendaL • __ j A ,
For both positions^ "a -good degree in either
mathematics, oompuang,. ; bccHaa^ lelacedsubjecc. - , . . >
To apply, please write with your CV to Lindsay Armstrong, Recruitment Coordinator,
Rada Recruitment Communications Ltd, 195 Euston Road, London NW1 2BN.
Applications should be received by Wednesday, November 15th and all replies will be
MembaoTING Giwi,'
Fixed Interest UK Business Manager
M«corv Asset Mangemex* Grottp pic has gpnown steadily over the past 40 years to become Britain’s
over £80 under tnarmgetaeta,
. _r ******** at the Fixed Interest Division, reflected by > £ 1 ? biQum increase far
, n lean, leader, tbi, (ration will primarily involve all internal and external business
-idrin *e rnan by nndemandins and addraing cBent
• Wtaktaf^bTtod^wem and marketing yecmHat. to ensure that the mam', value
and accurately c ommuni cated.
pioposttioft to fatty and acctitaieey
- . ,, mnmt Kave mbtartfal experience and under standing of fixed Interest
idte/be wfll have had some exposure to fund management and a
minimum of five years financial maricet eaqierience.
^S^rSanennlng and < hnenraonal s**, vi* *s *d*y - , —ricarn edecdvely
- an MBA wodld be pttferted, and Ife aUli* ^
team boM? and benefits offered will be extremely competitive and
The basic salary pacKa ge, ppmw
com ,iu>n K ua ■ , . _ cwfcca at BBM Selection quoarg Ref: 412 and enclose a fuR CV that include*
Interested maScrS- AB appUardana win be treated in the: strictest confidents.
e # mill Teb 0171.248 3653
76 , Wading Street, |||fM Fax: 0171-248 2814
London HKIH E-mafl: [email protected]
EC4M9BJ
PrfrchW Aerospace, the parent of FahchM Aircraft in San
Antonio, Texas, and Domter Luftbhrt in Munich, Gsmtany.
seeks three finance professtonafe. AS posffions are tooted to
San Antonio.
FakchlW Aerospace faces many exerting chaBenges as Kbits-
grates two
» faces many exerti _
grates two leading regional aircraft maniActufeaTandl brings to
maiket Iraportsnt new aircraft products and services. We ere
searching far (ndivtouab who wart to be part at the development
of a vital new aircraft company.
Vice President and Treasurer
i Reporting to the CNeSRnancitd Officer, twspcstoco Is respon-
sne for ttie integration of flnftncbl activities between the two
manufacturing and service sites, wfth paitietieT emphasis on
international tax, accouiUng and foreign exchange. This funo-
ttm wfl contribute to an active corporate finance program.
The successful cendkfete will possess excelent presentation
and communicafion skfls, five to ten years of progressive
Wamgflontiresponsib Rte s.pwtorahtywghmaniitatrti5ingen-
terprlses, and wmnmess to travel frequently. Facffity
man tonguage wotid be a plus.
Product Finance Associate
ResponsUe tor the support of a wkto range of sales finance
activities Involving Fain^ and Domiw aircraft, this ptMfflonwffl
report to the Director of Sales Ftancein San Antonia Activities
wa fndude structuring, negodafcg and documenfing aircraft
leesas; monitoring porttofc activity and syndtoafions.
The successfid appficant wB have axcafem presentadon and
communicaBon sUe, Hires to five years ahoaft finance experi-
ence, nctudtog tutnprops, and a knowledge of asset-based
and other akcrzdi finance structures.
Treasury Associate
This posBon wR partidpete in a diverse range of treasury
activities undertaken by the CFO and Treasurers of the com-
peny. The finance group estab&shes budgeting and planring
procedures tor the cofTpeny, prepares frequent reports for
management, stockholders and financial institutions and pur-
sues capital markets transactions. Thfs position wa support
these, and other important thanda) activffias.
Tba i successful appficant wB possess a graduate degree in
businesa or e related field, three to five years experience In
manufacturing and the aUKy to work ancMy as pert of a
team.
Ph— taw toir— tlci Director ofH e cr uI hnai^RriraWld
Aenxpece. H wwfl e Bou rteePap ete ea wL P^.Box 790490.
Sen Antonio, TX 78279-0490. te No. 2KM24-M76. EOE
UK EQUITY RESEARCH
MAJOR REGIONAL FUND
MANAGEMENT GROUP
Tilney & Co Is one of the UK's oldest and largest
independent fund managers and stockbrokers, with
client funds totalling over £4 billion. Following
our MBO in 1993 we have no outside shareholders.
We are growing rapidly and now operate from
• 10 offices with over 260 staff.
We believe that high quality, objective,
in-house research is an essential element of our
success and we devote considerable resources to
this area of our operations.
Our Research Team has an excellent reputation
for the quality of its product and we are now keen
to expand it further, welcoming applications from
experienced UK equity analysts. Following a
re- allocation of sector responsibilities wtthin the
existing Team we are particularly looking to expand
coverage in Financials and in a range of Cyclical
Industrials but specialists in other areas need not
be deterred from applying. The Research Team is
based in our Liverpool Head Office, enjoying the
many benefits of this North Western location.
If you would like to discuss what we are
looking for do feel free 1o call Peter Bickley,
Research Director, on 0151 236 6000.
Applications, with full CV should be sent
to him at Tilney & Co, Royal Liver Building,
Pier Head, Liverpool L3 1NY.
TILNEY &. CO
aocfcbnMdraa«nd Fund
MmQanwnt tinea 1830
APPOINTMENTS
WANTED
Up to 2 years
experience and/or
M.Sc/Ph-D. Strong IT
skills (C++/Unix etc). '
Please contact
Stuart Norbury
TV1: 0171 242 9000
Fax; 0171 405 6434
e-mail:
alexmannpterfi^dlaLpipex.
OOmAMP (fee Cobb)
INTERNATIONAL
PUBLIC RELATIONS
European aflffiate of a us-
based Memahonal pitoSc
relations ffcm opentog Dubfin
offioe seeks highly motivated
Mridual, experienced to pub&c
reiafions, issue campaigns,
TACIS, social marketing.
E.U. dizenship required.
Fax CVAattar of Merest to:
Human Resources Dhsctor,
+1-215-735-5454
BANKING/SUPERVISION !
CONSULTANTS !
bel assignments for
Professionals urithwgNrienceki
Bank Supervision. Restructuring,
Crecft, Workout, Benk
Accounting, moperetiens, AIM,
Strate^opfonring, Trade
finance, FDIGtOCCIFRB. Sand
CVtiKPO Box 18574,
Wa shing to n. DC 20041 USA
TOADER
London
Our cB«u, a prestiKiotre I'S investment bank, is looking for
an experienced Trader to work in the European Emerging
Markets group.
The fallowing attributes are essential:
• Proven track record in maiket making
• Proven academic excellence, including e good Masters
degree in Business with a concentration on International
Badness Transaction Law
• Ai least 2 years' experience in sales & trading and
investment banking in the Emerging Markets group of a
leading investment bank with particular emphasis on
Russian markets
• First hand knowledge of the former Soviet Union gained by
extended periods of tone spent there - at least 6 years
• Fluency in English and Russian
• High energy level and ability to cope in a highly pressurised
environment
• Proven interpersonal stalls.
To apply, please send your CV, U>: Alastair Lyon. Confidential
Reply HanriKng Service. Re£ 562. Associates in Advertising.
5 St John’s Lane. London EClM 4BH.
Your application iriB only be forwarded to thin client, but please
indicate arty organisations to whom your details should not be sent
Asso
RTISING
O
Macquarie Bank
Permanent Part-time Lawyer
£Neg.
Compliance role
London
Macquarie Bank Limited i* ibc ooly substantial. Australian-owned investment
bank. The London branch of Macquarie Bank operates in foreign exchange,
base metals, structured finance and equities. Macquarie Batik is seeking to
appoint a lawyer to iis London branch, in a permanent part-time capacity, a
position which will require a commitment of aioond 3 days per week.
The Pothion: The role involves responsibility for all legal and policy
compliance matters in the Loudon office - c o nstan t monitoring of (he Bank’s
activities. liaison and reporting to the Sydney-baaed Compliance (earn,
developing and implementing policies and procedures as requited.
The Person: You will be a lawyer with 3-4 years’ e xp er i ence gained within a
genera) corporate or banking law environment. Knowledge of the general
regulatory envircronenL is essoitial and direct compliance experience would be
considered on advantage but not esaentiaL
This b an Ideal opportunity Air a person looting to continue in, or return
to, the workforce on a part-time bwk
ff you are interested in pursuing this excellent opportunity, please forward
yotw application to:
Peter Grimsbaw
Manager, Legal A Compliance
Macquarie Bank Untiled
9th Floor, Alban Gate ]
125 London Wall ,
LONDON EC2Y 5 AS
Bernstein & Co. (suisse) s.a.
INTERNATIONAL FUTURES A OPTIONS BROKERS
Sects highly motivated sates people for oar options division
QuatificatioBS needed:
• V— irg pr ir ady employed in me —le» dtvtd— In a bra luri i g o company
■ Yaw art vary toccata la your promt pocideo '
• Yea mewflMag taidaemaabnad
Job tfiacriptiom
Sale ef financial servicca oy pdana to napanw ricaatad al ever At world
We offer yon:
- A rakr j w it h a po tenti al of at hart! IOOjOOO pec year based on 1004^
rnaiwlnun
• Area— da tinaa la toapng apa rt mc ali k dat heart of C an e r a
If yea malch this profflo, phase a*l or (as year appgmiioa A CV tm
Bernstein & Co. (suisse) s.a.
RUT Dll MONT-KLAffC 4 » CK-1201 GENEVA - SWITZERLAND
PBONEi (+41) 22 »09 <000 • FAXi (+41) 22 909 SOSO
Senior Spot
Foreign Exchange
Broker
required to work with established
team of Swiss currency brokers.
Applicants should be able to speak
fluent Swiss/ German with, a
minimum of 5 years market
experience.
Write to Box A5732, Financial Times,
One Southwark Bridge,
London SE1 9HL
If you believe you have the right background and experience to fill the
above posts then call Tom Delves, Head of Information Services
Division on (9662) 6613412 (direct) (9662) 6608820 ext. 643 or fax
your detailed CV on (9662) 6608820 ext. 160 or (9662) 6605304.
accountancy appointments
FINANCE DIRECTOR
COMMERCIAL ROLE - MARKET LEADING INDUSTRIAL LEASING
MIDLANDS
• £70 million turnover subsidiary of FTSE
mid 250 pic. Highly profitable market
leader in a mature and competitive,
marketplace.
• Growth by acquisition is a fundamental
dimension of the company's strategy. It
therefore needs a Finance Director who
will actively support this development
whilst maintaining effective control and
service standards.
• Responsible for motivating a team of 50
to achieve high levels of service to
decentralised business units, along with
effective and timely reporting to Group.
PWaae apply to writing quoting referen ce 1263
wttb Am areer and alary deeds to:
Mu Mumby
TUT-lrj- lu-n_1 Ii ti Inn t Imfrui
wrmcncw xkcuoq unaicc
1 1 Hfll Street. Loodoa W1X S8B
TfcL 0171 290 2043
ht«pV/Www^o«XO.uk/wtiitcbcad
c.J£6 0,000 + SUBSTANTIAL BENEFITS
• Graduate, qualified accountant, aged late
30s, ideally with leasing experience in a
strong service orientated culture.
International experience could be useful,
although initial focus will be UK.
• Hands-on, energetic and demanding high
standards. The role calls for commercial
focus, individual commitment and directness,
along with flexibility to contribute to
acquisitions and other planned developments.
• Very much an influential role in the
development of the company strategy, die
scope for career advancement in the
company and Group is considerable.
Whitehead
S £ L E C T ! 0 .V
1
in global capital markets.
Friffl^lhihufihts and
.4-‘£v-A ' '
ways
lIMfc Banking;
wi n ni ng mor w amt rig
work among the world
confidently expect u£(
A*. V.:
«nc«l in ari tuti on*. Indeed, we V
■efingjp urjfe 'of pt ofewiihil
services to dna H/youfce wandermg.-
bow can be re.sore abom the fazut^ you ooed to T -
mdbi nwi what Wredoingin tbe hare and now. > £
% ivmilii— knowledge of global < a pin lai ui i l» < « i
and c o naoha na y expertise m one nttpinj and swkmfcs s' '•
*"**** capability — up fryfoemves timuit
nmj» Of • 1721)0 wjwnAin. H l f iiml fcty t hou gh jft rflf
reaOj increases our dkm. Oar refraftingty open - *
approach to eoasatting does array noth, tbe mystique o£. L -
“the expert” and ■■<»! "* gdnh fl q i ,w^
c «m«h eBBbh to the cnato nt^.^^y onridejeal and, ^
dranoostraMevahiefor money. remits, not ' *
** AwwT n. cfoy wMj
until we have delivered what we promised. ' ‘
A steady flow of important new business means
that we need more experienced practitioners who are ;
Mpr tft ltmve fmm a l milfKon.1 wmmlling fir m Of •
bjttfcjnjr environment to the fresh th i nking and winning
wajarfIBM. Tou xnnst have two to five yean’ experience
of large-scale projects within the international capital
aaa An ta sector. A sound understanding of the
corapbadiiaa of time msAots is essential, i ncludin g
operational infrastructures, settlements, trade su p p o r t,
transaction processing, and risk analysis & man a g ement.
'fen mnut alio be prepared to travel widely within Europe
in tin causae of your weak.
.. SlTiw and twtefitaare deagnod to attract jxcfeasiooai
of the Irighaw quality. Unfibe traditional
hie rarchy . we“can promote good people as quiddy as their
g ^TMwri . awl ijau S B . Plans write Vfitfa a fall
fr^ thf adviang «i these app ointtn l eDia :
Rou (B71-248 281A,fTaase. quote rtf:
CBM is an equal-opportmuty eujployen
Ihe HBH homqjage cm be found an the Intern* at
httpJhmmBJb*njCom
Solutions for a amdl planet
ACCOUNTANCY APPOINTMENTS
Chief Financial Officer
London
Six figure package
Due to the expansion in size and complexity of itsXIK subadiary, our client, a major U.S. investment hank
is seeking a Head of Finance to redesign and relocate its tjj£. financial, accounting a&d' regj&lory
operations from New York to London. • .
Reporting directly to tbe Controller in New York, die initial task will involve extensive liaison ^Jb. die
present inr.irmhent, with some travel to New York. Responsibilities will include accounting, fax and
regulatory functions fbrthe company’s UK-’ affiliate. ^ | *-- - ■ •"
Candidates must have proven organisational and management skills, .with the ability to-grow .and develop
the role as foe bank expands its European operations. Candidates will be qualified acco un t ant ^, with at least
five years proven senior management experience within foe securities arm of an investment bank or,
alternatively the financial services division of a leading international accountancy firm.
A thorough understanding of derivatives and capital markets products combined with a sound knowledge of
SFA and regulatory reporting are essential requisites for this challenging ^and exciting role. '
Interested candidates should send or fox their Curricula Vitae, stating current remuneration package, to Carol
Jardine, Principal, Jazdine Kelso, 53 Shepherds Hill, London N6 5QP. Fax: 0181-341-4463. Interviews will be
held in our Central London offices. Quote reference number JK0031 [■
• Jardine Kelso
Finance Director
TELFORD, SHROPSHIRE
Chequer Foods Limited carries on business as processing
manufacturers of convenience foods for the fast food,
catering and vending industries. It is part of the Autobar
Federation which is a Pan-European organisation
comprising over SO companies.
An exceptional Finance Director is now sought to assume
day to day control of the financial management function
and to act as a key member of the management team on
the formulation of overall strategic policy. Reporting to
the Managing Director, the principal tasks will be to
oversee and review the preparation of ma n ag em ent and
statutory accounts, initiate and manage new technology
improvements, act as tbe principal point of contact on
financial issues with professional advisers and provide
assistance to tbe Board on the financial implications of
commercial transactions, including acquisitions.
Approp ri ate candidates wiP probably be in tbe age range
35*45 and of graduate calibre with a recognised
accountancy qualification. It is essential , to demonstrate
Chcqaer Foods Limited
EXCELLENT REMUNERATION
several years* experience as a Financial Director in a
manufacturing environment (either a stand-alone
company or a division of a major group) with exposure to
standard costing issues. IT literacy is very important. A
knowledge of European languages, particularly German
and French, would be very usefuL The appointee will be
an inspirational team leader and an approachable
individual who can relate to, and who seeks the views of,
operational staff.
An attractive salary packa^y will be offered inc lu di ng
substantial bonus potential and a quality. . can
Opportunities for further career development within the
European group are excellent
Please write, in con fide ace, with full ca reer and salary
details to Geoffrey Mather, MSL International Limited,
32 Ayforook Street, London W1M3JL Please quote ret
60995.
Interviews w01 be held in London and the West Midlands.
FINANCE DIRECTOR
MAJOR INTERNATIONAL GROUP
WEST MIDLANDS
• O pp ort un ity for an experienced finance
professional to work closely with a recent ly
appointed Main Board Director to build on the
growth strategy of a £300 million plus turnover
business of a major int ern a t i o nal group.
• The business comprises a number of
companies around the world, with the centre of
gravity in the USA pursuing global expansion
plans in the manufacniring and selling of
equipment to nrulti-natiohaf drinks and hst food
c omp a n ie s .
• Key tasks will include, the provision, of a
comprehensive financial service for a global
business, tbe ongoing development of financ i al
co-ordinatfon Inducting the development Of
i nte g rated IT systems and the c o nt rib ution to ..
deac *PS*f in witting qncelng reference 12S?
wkh foil c aree r and nhry d ctilft to: -
TO £75,000 + BONUS.
business development including M&A. Significant
International travel will be necessary.
• Probably 40-50, qualified accountant with •
broad co mm ercial experience In the
manufacniring sector International experience is
important, particularly in the USA
• Demonstrable success in le adi ng strategic IT
projects would bc an asset, as would exposure to
international M&A activities. Operating
experience in both, large and amaH. company
environments would be preferable
• Wdtdeweioped inOocaciag skills are vital in a
business entente which has been highly devolved.
Determined buit diplo matic character Ability to
opepue independently. Willing to invest 5+ years
ih'S^senior position within a fa yhrwiwg and.
(-Tp a ty<lng nwifat *
iWmwim
Whitehead
StLcCTIO N
1
C'-ASCG tV ? r ■; Mir.in: ‘.. t* -
■ii.:! C: 1 1 O' -I
Finance Director
International Marketing Services
Jeddah/
Saudi Arabia
US$56,000 plus
■ expatriate
package
KINGSTON
SMITH
Our client is a British-Managed offshore-
bssed marketing services group with a
multinational client base^ c im et Ui y ope ratin g
on the Arabian Peninsula and with
amadous expansion plans in place. Growth
has been sixfold in its first three ye ar s.
A Qualified Accountant with experience in
the industry sector and with exposure to
international business (preferably in the
Middle Hast) is required to join the
Expatriate Senior Management Team as fee
fiist Hnance Director. The main tasks will be
to assist in foe restructuring into separate
companies, supervise all accounting matters,
set up and implement all relevant cost
ccmirob and systems, take responsibility for
g e ner a l admurisfaatkun aftfl; in summary,.
es ta bli s h the necessary ope ra ti on al financial
structure which will enable the Group to
This wifi require a stable, mature
personality (not necessarily in years) with
i mpeccab le professional standards, an
entrepreneurial ability, strong personal
skills in dealing with people of various
cultural backgrounds and foe desire to
forge a career in this environment This is
not a contract posting.
ThepadagevriU include a tax-free salary of
US$56,000, family housing, medical _
™surance, car and a return flight annually.
Resumes only, pleetsq, to: John West
Kingston Smith Executive Selection, .
2 Dryden Street London WC2E9NA.. .
Fax:0171-240 0723. Vv
^ ^0013l3550©Computerve.Cbm f :
a*
FINANCIAL TIMES
fridav November i 1996
v
*nd
SENIOR INTERNAL AUDITOR
BRUSSELS
AGE 26-29
oore Corporation is a global leader in delivering Information handling ptodixzTsnd services that
create efficiency and eompeiidveness for owomers. Founded in JB82, Moore has ipproxtaarefy
19,000 employees and over 100 tru n ufa rtu nng facilities serving cusiomeis to SO countries with
aimuai sales of USSZ6 billion.
Vrthln the cotpocne audit services the successful candidate wiD report to the Corporate Internal
Audit Manager. BcspoDsMtoss will indude:
planning, executing and reporting on financial/ operational audits at mainly European
production and sales units;
• providing, rccomraendatioos to the management in order to Increase the operating efficiency
and effectiveness of procedures;
• liaising with external auditors and wfth local, divisional area and corporate management.
The Ideal candidate will be a qualified Accountant rCPA, ACA. RA or equivalent with ar least
four years experience in a Big Six firm. Fluency in English and a good command of at least a
second European language is an asset. He/ she will have strong interpersonal wftb an analytical
ROBERT WALTERS ASSOCIATES
mind and be able to work iixk’pcndeady The portion mil involve approximately 5ti per cent
mtemauona) Bal'd.
For dtis duliengtng pcc.it km, our client offers an mtetxsong .caiaiy package including a
number of fringe benefit* as well j> exemng opportunities within an internal tuixil nmup
Interested applicants cun contact Christian Smets on telephone 00.42 2 511 66 88, or send him
ihetr detailed curriculum v iue at Robert tTatten Associates. Avenue Louise 66 box low Pnneh.
Belgium. tn 0052 2 51 1 99 69. E-mail. ftniM Ww tc B v rallM.com
L ° N s o N
Did*
AMSTEtDAM
■ U S » S 1 t
SYDNEY
No. FS30091
KLEIN !■ TON
ft
er
c. £100,000 package
+ benefits
Blue-Chip Standee Business
East Anglia
Finance Director
Ante opportunity to join a profitable, high profile am t Innovative business with an inherent market
capitalisation In the region of ElOO million which is part of a large quoted groap embarked oa
diversification. Condoned expansion and a challenging strategy to grow both organically and by
acquisition requires a highly ambitious finance professional to support the Chief Executive in ail
aspects of strategy and operations.
THE ROLE
■ Acting as a sounding board to the Chief Executive,
setting strategy and evaluating the ongoing
performance of a diverse portfolio or high
potential start-ups, jvs and recent acquisitions
initiating, negotiating and delivering a range of
acquisitions, dealing directly with principals and
managing advisors. .“
Enhancing the financial .management and IT
infrastructure to support planned rapid growth,
providing guidance to functional reports In the
operating companies.
THE QUALIFICATIONS
■ Graduate ACA/ MBA, aged early 30s+ with first-
class financial management, modelling and
corporate development experience from a blue-
chip, fast-moving business.
■ Challenging yet diplomatic style. Able to respond
quickly and assimilate data promptly to generate
imaginative business solutions, capable of and
keen to encourage initiative whilst maintaining
tight financial control.
■ Highly commercial with superior communication
skills. Excellent staff and project management
s kills . Effective in dynamic, technology-driven
cultures and able to progress further.
Leeds Ol 13 3307774
London 0171 49S 1238
Manchester Q 1 61 499 1700
c. £30,000 package
+ options + benefits
International Manufacturing
Group
Midlands
| Head of Corporate Finance/Treasury
Key role at the heart of an acquisitive and highly profitable £700 minian + turnover UK pic with an
enviable growth record, weU-balanced international profile and a dominant position In each of its chosen
niche markets. Powerful balance sheet and strong City support underpin a well-proven and focused
strategy for growth both organically and by acquisition. Significant opportunity for a well-rounded -
finance professional with M&A experience and exposure to treasury seeking en/umcal respon s ibility and
professional growth In corporate deve l o pm ent and, tn due course, general man ag em en t. Excellent
international career prospects.
THE ROLE
■ Reporting to Group Finance Oliecior with specific
responsibility for corporate development and
treasury as pan of a small head office finance
team.
Working closely with the Board to identify and
evaluate potential acquisitions internationally,
developing proactive relationships with key financial
advisors in the City.
Strategic management of treasury, supervising an
established high quality function, focusing on
funding and balance sheet managemenL
THE QUALIFICATIONS
■ Graduate. Chartered Accountant, aged 30 plus, with
M&A exposure and treasury experience gained in
either a merchant bank or a corporate Second
definite European language an advantage -
preferably German.
■ Strang analytical skills and broad business overview
combined with first-rate written and oral
communication skOfs. Comfortable handling
complex negotiations at senior level.
■ Accomplished networker and relationship builder,
capable of operating effectively as pari of a small
head office team. Self-starter with the ability to work
Independently.
1 Selector Europe
ni4r wHi MI d^aMain
Moon- Eniwpc. ML M008I061,
Leeds 01 13 2307774
London 0171 493 123S
\ Selector Europe ,
| Spencer Sluari
London W2 ZED
Manchester 0161 499 170 O
Spencer Stuart
nuc rapjy Wtlh fan rfctWU OK
Manor Bmp*. Kef. KOUIOU,
16 Coonauzbt Place,
IMdHWIUO
Treasuiy Audit Professional
High profile position in a rapidly developing Middle East Bank
To £ 45,000 Tax Free + Substantial Benefits ■■
Based Jeddah - Saudi Arabia
The National Gwmodal Bank is the largest commercial
bank in Saudi Arabia. It has a network of oyer 200 branches
and serves customers throughout the wodd.
The Bank is embadring on a challenging business expansion
plan which will include the development of new Treasury-
and Investment Services activities. The Treasury Audit
function is seen as having a cntical role in this development,
assisting in establishing and maintaining operational controls
in order- to support effective business risk mana g emmt.
As pan of this process we arc seeking to recruir an additional
Treasury Auditor to work within this specialist team.
Undertaking in-depth reviews of business areas you wiD be
required to:
4 Risk products including securities and derivatives. -
• Review procedures and controls in the middle and back
offices.
• Assess adequacy of management reporting processes.
You will have gained operational or audit experience in a
treasuiy environment, together with knowledge erf the latest
Applicants for this position should be graduates and/or
professionally qualified, with excellent coronmnicarion
and report writing skills. The ability to work independently
or as part of a team in a mulrinarional environment is
essential.
In return for your skills and commitment, the bank is
offering employment on a two year contract basis, renewable
by mutual agreement. The package offered inctades a tax
fine salary, performance related bonus scheme, famil y
accommodation, medical expenses, annual return air tickets
to country of residence and contribution to school fees
incurred in the Kingdom.
For further details and to arrange an interview,
please contact Tim SandweQ at Barclay Simpson Associates,
Hamilton House, 1 Temple. Asrenue, Victoria Embankment,
London EC4Y OHA. Telephone 0171 936 2601.
Fax 017.1 936 2633. E-mail [email protected]
the nrmomL tominBtanL ram
Director of Finance
Northwick Park & St Mark’s NHS Trust
To £60,000
ifl
Harrow
Excellent career opportunity at Board level for ambitious finance professional.
Make a major contribution in shaping this leading provider of health care services
in north west London to become a model hospital for the 21st.centuxy.
THE TRUST
♦ Provides a full range of general acute services to load
population of 500,000 and specialist services to a much
wider population of 7m.
♦ Clear strategic objectives and corporate values. Strong
reputation for medical research and education programmes.
♦ Turnover of c.£85ca p/a. 2,700 employees. Significant
recent investment in new f at alities.
THE POSITION
♦ Executive Board Member. Contribute to development of
Trust strategy and business plans. Report to Chief
Executive.
♦ Exercise strong fina n cial control, eimnin g targets are met.
Provide dear management infbrmtrcion m the Board.
♦ Lead and motivate finance team of 35. Support
operational and clinical directorates.
QUALIFICATIONS
♦ Professionally qualified, with substantial financial
management experience ox Board level, ideally in the NHS.
♦ Both a leader and team player who can improve
productivity whilst maintaining quality and financial
viability.
♦ Good communicator with presence and authority. Able
to make a real impact and build effective working
relationships internally and externally.
The Trust is commuted to Equal Opportunities.
Please send full cv, stating salary, ref PS6 1 004, to NBS. 54 Jermyn Street, London SWIY 6 LX
N E SELECTION LTD
t BNB Resources pic oo rop seoy
NBS
London 0171 493 6392
Aberdeen* Birmingham * Bristol • City
Edinburgh - Glasgow ■ Leeds * London
Manchester • Skiu^i • Madrid • Paris
t
Group
Accountant
CJc32,500 & BMW
Sfostanfial and dynamic UK pic which is adively
individual* with the capacity to develop a broadly based finance
the initial job will be rhe control and
manaaement of the budgering and forecasting systems across the
Grouch liaison with the business Finance Directors to
rottinq cash flaw and profit forecasts; model ing oneoff situations and
assistance with the monthly reporting process; and
special project work which will include investment appraisal,
c^uisifoL and divestment reviews. The role cab to on Mm
young professional with a very well organised approach to the
analy ^ b d x u °fi < MT* «• b X
trained with first rime professional passes. Computer I iten^js a key
requiremebl, togaherG^ ability to develop h.gh standard, of
analytical and presentation^ skills.
Location - South West London
Please apply in confidence quoting ref: 16 1 5 to.
Mifrd
Tb* hir«aH nfc h Party
DIRECTOR
Mnd tht faring mental health darky b seeking a Director of finance
ft Resources to provide strangle leadership and be respanribfa ter al
Mridk support services including Finance, Hiamn Resource*
Administration, Information Technology and Faddes Ma nag ement.
Ybu wffl hM a hay role to pfcy In Mtadfc Corporate Management Team,
fazdfag on tha dewlopment of medium and long earm financial
ttr at e y a b and tin continued de v elop m e n t of Human Resources.
. A quaMad acc o unt an t; you wffl have o coe fcnt analytical and pfenning
sfcBs and ba a g>od communicator, capable of explaining complex
flnaneU Mbmvdon to non financial people. You will abo hare a keen
awareness of opportunities fct a new funding environment. You wtil
ovarsee t'fcxft bntstmenr portibto and t» a dtocmr of Mindli tredbig
compact
Canddaas must hare experience of motivating a taun and a good
undervaluing of ampkqfce rafations.
Salary fcr the abova post around OS.OOO par annum, plus ben*fi».
For an appfkadon pade write on a poftearri only me Humm Resourees
DRR) 15-19 Braadww London EI5 48Q (no telephone cals or
CVkplM^.
Qosing dais for competed appficadom 15 November 1996.
ktijenfaw* expected 6 December 1996,
Rag. Charity na 283329
Mhdii at etpnf opponmAfes empkgw
SCOTT
Brian Mason '
Masc»i &
l Lancaster Place, Strand
London WC2E tEB.
Tel: 0171-240 7805 .
Mason
& Nurse
Selection and. Search
APPOINTMENTS ADVERTISING
appeals to the UK mtttion nvwy Monday, Wednesday A Tfwndtry
and In «m International atfltion every Friday.
For further infor ma t i on pteaae calL-
Toby FtaHhMtCvoftB Ml +440171.873 3458
PROVIDENT
HEAD OF INTERNAL AUDIT
c.£60K + Executive benefits
The Scottish Provident group currently consists of seven operating units (three based in the
UK, the others based in Ireland. Greece, Spain and the Isle of Man) transacting principally fife
assurance and investment business. The group hat funds under management m excess of £6bn.
We are looking for an experienced Individual to lead the Internal Audit department, which is part
of the compact Group Head Office in Edinburgh.
Prudential control of the business in Its widest sense is taken very seriously in Scottish
Provident. There is a strong Audit Commttree of the main Board, and within the Group Head
Office a Prudential Control Group which acts as a top-level management dearing house for all
audit compliance, risk, control and corporate governance issues. The Prudential Control Group is
chaired by the Finance Director (who Is also Deputy Managtog Director of the group) and Involves
the Chief Accountant, the Actuary and the Secretary. You will be a member of the Group slid will
be retired to report regularly to the Audit Committee: day-to-day reporting will be to the
Finance Director.
The Job involves: devising and managing a rolling audit plan to cower all the main areas of risk
within the various operating units, enhancing the scale and competencies of the existing Internal
Audit department and raising its profile within the organisation, and developing the practice of
good risk management throughout the group.
You will lave wide experience of internal auefit and hlghfy effective management skfils with
preferably experience of the financial services sector. The abifity to think widely and imaginatively
about risk and control Issues combined with good people skills will be important factors in the
selection process.
In return for your commitment, we offer an attractive salary and benefits package, Including a
car, non-contributory pension and fife assurance scheme, private medical insurance and montage
assistance and participation in a long term incentive bonus scheme.
Applications in writing should be submitted to David Adams, Group Personnel
Manager, Scottish Provident, Group Head Office. 7-1 1 Melville Storeet, Edinburgh
EH3 7YZ. Fax: 0131 527 1 1 1 2. Closing date 2 1 November 1996.
Scottish Provident is an equal opportunities employer *'
: '*i„
VI
;- 7 -“
EUROPEAN TAX LAWYER
!)KUIV\TIVKS-lV\Sl-;i) FROM Ol'KlCK ROLF
London
cj£100,000 + Bonus
+ Benefits
This assignment is being handled
exclusively by Brewer Morris. Please
r contaci Matthew Phelps on
* 0171 415 2800
, k dr write to him at Brewer Morris,
. . . 179 Queen Victoria Street,
London EC4V4DD.
Facsimile 0171 463 0740
Brewer-Morris
.TAXATION RECRUrrMENT SPECIALISTS.
We nre representing a worldwide financial services organisation which
advises muUiriiuioiial corporations, financial institutions and.
govcnnntnx entities. The global derivatives financial structuring group
en gineer s unique investment products and creates derivatives- based
solutions to tax and accounts issues for major corporate clients.
Sustained expansion across the global derivatives business has created
a new role within this dcdimird team of 6 professionals. Key
responsibilities win indude:-
• structuring and tnailoeting of tax-advantaged products to clients
• utilisation of nUBrnarional/domestic tax rules to enhance trading
revenues
■ provision of tax input to documentation issues surrounding
complex derivatives trades
As a European, qualified Lawyer you will have a broad knowledge of
European tax systems and treaty networks, and a" genuine
understanding of financial instruments and- their outf 'treatment.
Transactional experience in a bank or investment boose would be
ideal, however relevant experience gained in a leading advisory firm
is equally welcome. Strongly team-orion rated, with excell ent
organisational and execution skills, you wiH engender trust with a'
broad range of so ph i sti c at ed c o rp ora te cheats. Hueaatiy pm or more
major languages (iiKJudin^Eflglisb) is essemfeti. V V . .
. V.\ - S VlNANCIAl; TIMES FRIDAV NOVEMBER
Group Director Of Finance
1 1996
} \ V
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W Lucy Is an Independent, verhcao^-' Migrated
manufacturer of electrics! efetribution oqufcrnaqt, grey -and
SG Iron castings. Rs two rtMi opacstihgl .
oombined turnover of c£35m, su^po&cf^y a ;
property and investment division, It femtffrafted i
with sub si diaries, a ssocia te rompartesrabd •
agreements, in major worid markats. U
ithfeUK.
harsWp
scale
in v estment programmes- over thelast TO yearshave
^owed the co mpa ny to meat the c haBy ges of d changing
market ptaca. . . • V | |
Reetructuring' lrOt> focussed business units is ^ongoing
and necessitates ■ toe finance function adding yakie to
manufacturing and commerc i al operations of- varying size
and ^complexity-. Tito position takes full rasponaibWy for
the day to day handeon control of the centralised finance
function, induing the devriopmenf of reporting sys»™>
and controls. This new role reports to (he Board, early
accession to which fe envisaged.
candidates wW be ACA or dMA professional accountants,
vvhh extensive business experience. They wffl probabty be
senior financial axecutives In multi-sted, international
manufacturing businesses. Wen rounded and highly
o om m e tdaB y orientated, they wiH bo skffled In the provision
and implementation of tight operating and finance controls.
Please send a comprehensive CV to Keith Miner,
Howgate Sable & Partnera. 35 Curzon Street, London
W1 Y7AE.iy: Of 71 -4951 234, Rix: 0171-495 1700, quoting ret
FX34CLD. VSs ff our web street HBpdlwawtDplQb&coJjk
Howgate
& Partners
Executive Search and Selection
EUROPEAN FINANCE
WEST OF LONDON .
. •?;
c £60,000 + CAR + SUBSTANTIAL BONUS
This major US based compute^ {easing and trading organisation has
recently established a powerful presbnee in Europe and is well poised for
growth in its major European markets. It is focused on providing the
highest level of customer support and choice, whilst remaining at the '
forefront of developments in systems technology.
In line with supporting the European Managing Director to drive the
business forward across Europe, an exciting opportunity has now arisen
for a highly commercial individual -to join the company as European
Finance Director.
Reporting to the CFO in the United States, and the European Managing
Director, specific responsibilities will include overseeing European group
and management reporting to the US parent and providing financial strategy
and commercial direction to this Group. In addition this individual will be
responsible for the management of ongoing banking relationships and all
other treasury related issues.
The successful candidate, probably aged mid to late thinks, will have a
professional accounting qualification, experience of US GAAP reporting and
ideally some exposure to die leasing industry (servicing any business sector)-
ROBERT WALTERS ASSOCIATES
Strong presentational and inter-personal skills are required to
support the- blend of reporting and commercial experience necessary for
rhiK position. The ability to manage and motivate a number of teams
within finance and MIS based In Europe will be key.
Interested candidates should forward their curriculum vitae,
including remuneration details and daytime telephone number to
Andrea Black or Richard Parnell at Robert Walters Associates,
42 Thames Street, Windsor, Berkshire SL4 I PR, or fax 01753 <578 908.
E-mail: [email protected]
■ t tiweroff
F
ercial Mind” - Major International Consumer Business
.. i i
rroup Financial Planning Director
Eorfy/Mid-3 Os c £.60,000 + Substantial Bonus + Car Home Counties
Our -Client Is a major “household name* highly profitable and
fest-growlng international consumer business, with a strong reputation
lor dynamic and aggressive management, and Is the established
i market leader with operations that span the UK, ConDnotial
Promotion ol the current incumbent has created a need tor an
exceptional and ambitious qualified accountant to lead its central
Financial Pfenning function. This tngftfy Qualified and experienced
professional (Barn is responsible tor pravkfing analytical and business
support to operational management In terms of identifying and
rsccwnerafing profit Imprmemant apportunOes, as well as preparing
Group annual and long-term plans, monitoring and critically
^praising country operating results, and producing regular Board
reports and forecasts o) Group performance. Additionally, your team
will araiuatB ail significant Investment projects, produce preservations
to shareholders, banks and City institutions, and be involved In all
corporate finance projects.
You will be a htfily commercial and analytically-minded qualified
aocountafit with previous man-management and financial
pfenning/analysis experience gained within a ‘disciplined*
environmert ideally in an Int er n ati onal East-moving consumer product
or service business. You will also need' to be self-confident yet
diplomatic with good interpersonal skills, have strong powers of
persuasion and to able to demonstrate finance directorship potential.
The remuneration package is flextoto to aflrattan exceptional individual.
Yoa sbnli write or tax In conflduca, Mdcriag your
rasarau aid currant salary details and daytima/suoaini
tatopfaouB contact numbers, quoting raf s ronco 61801 on both
envelope aad tatter/fax. to the address betoac
Ctnyssapbes Rammigar Associates, Bechtel House, 245 Hammersmith Road, London WB 8DP (Fa ic 0181 528 9878).
SIEMENS
Siemens is one of the largest most prestigious and innovative electrical and electronic engineering manufacturers
in tho world. As a leading force in a highly competitive global market, we have maintained this position by
continual innovation and development
As a result of internal promotion and expansion, we have two vacancies in:
.Corporate Controlling
Winchester - Manufacturing
Bracknell - Project, Product & Service
Attractive Salary, plus bonus and car
Following the decentralisation of financial responsibility within Semens, it is Corporate Controlling’s responsibility,
on behalf of the Board, to review the financial performance of each business. Working closely with each
business you wifi be responsible for developing and expanding their financial review processes.
Candidates will be qualified graduate accountants, possibly with an MBA, and a minimum of four years POE.
All applicants will possess analytical . exedtanoe. proven financial and commercial ability and exceptional
communications and presentational skids.
This- is a very high profile role with significant exposure s* senior management level, affording the successful
candidate the opportunity to be part of a highly innovative company and contribute to its continuing growth.
The potential for career progression is excellent.
To apply, please sand your CV. to Lynette Gleason, Personnel Mana ger, Semens pic, Siem ens H ouse,
Oldbury, Bracknell, Berkshire RG12 BFZ. Telephone (01344) 396237 Facsimile (01344) 396235
Poring date: 15th November 1996
Innovation
Technology
Quality
Siemens
Appointments
Advertising
appears In the UK
edition every
Monday,
Wednesday &
Thursday and in
the International
edition every
Friday
For further
. information
please call:
Dominic Knowtson
+44 0171 873 4015
Executive
C £55, OOO & Car
& Performance Bonus
Our client is a £1 billion quoted FMCG -Group with a number of
market leading positions in large but very competitive consumer
product sectors.
An early promotion from the corporate team has led to the need
to recruit a Chartered Accountant aged about 30 who will work at
Main Board level on a series of strategic initiatives which are central
to the next phase of the Group's development. The role wiH therefore
span acquisition and divestment* studies, investment appraisal, -Ifie
evaluation of competitive activity and industry structures, and forms of
joint venture and product licencing.
Applicants should be graduate ACA's with a top level academic
and professional record ana proven success at Senior Manager level
in the mainstream of a big 6 firm, including a good cross section of
special work. Individually, candidates must have the eriekgy,
dedication and lifestyle to cope with sustained pressure and make an"
impact both at Main Board level and with external advisors and third
parties. The position will be based in West London. Relocation
assistance will be available if necessary.
Please apply in confidence quoftrgrefr L6 1 4 to: . V • A : " &
Brian Mason
Mason & Nurse Associates
i Lancaster Place. Strand
London WC2E 7EB.
Tel: 0171-240 7805.
Mason *
& Nurse.
Selection and Search
Gro u p* d*
da conna tz 900
pMMD%1SMd
da franca da CAJ. ao
fort d * valo p p am a nt
- i r Stranger
Rsttaehe A la Direction International*.
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financier afficacaa mats s im pler,
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budgm, reporting, analyse et auM dea
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da* dhfgeants,
• las relations avec lea service* compta-
biRti at eontrdle da geation du groupe,
candidature (lenre, CV, selwra souhalrtj.
Conwil qul l'«tudiera an tout* confidential!!)* :
ctnnos. 1 1 Boulevard Pershing, 7G0T7 Paris.
Vpsne formation suptiriettiv an gaathn -
ast vakxis*e par une experience
Qptrationneile de 3 an* minimum,
aequlM an cabinet tfautSt ettou dans
une aocMtti int e rnational* de prasta-
tiona da aervicea de "metfere grtsa'.
See* * Parts, dana une«qttipe«to
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de nombreux NpOeantnti * rtimnger
pour suhna fee 8 tefilw dent vtxnMz'
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fallamacd.
ETHN0S
Executive Search
European Tax Analyst
Senior Researcher
Finance Director Recruitment
orffmuriibrfu leadens fa executive search with an outstanding record
j Of a highly collegiate structure and a quality consulting
Or “* /naz * ce leader in the recruitment of Finance Directors In the UK
■ ^"BPon and enhance our position we now seek an exceptional Individual to Join our
close knit specialist team.
m r ^ a S Ch on Senior ,ewel rMato?^^Si?Sth at least five years'
btoe-ehip clleH* STtof? 5S expericn ° e m dlher finandal recruilinenI - or
international markets.
Work alongside the financial management
consultants on the search process attending
Client meetings and then playing a pivotal role
in Identifying, attracting and appointing key
executives. * J
Provide proactive support bv constantly
monitoring market trends and developments
in financial management.
the profession. Language skills and computer
literacy would be an advantage.
Proven project management skills. Flexible,
tenacious and energetic, with a natural
curiosity. Robust, with a sense or humour.
Excellent written and verbal communication
skills with an ability to work in a cross-
cultural environment. Stature and presence to
engender credibility at senior management
level both with clients and across the Spencer
Stuart network.
Excellent
Compensation &
Benefits
European HQ,
Bracknell, UK
Leeds 01 13 2307774
London 0171 493 1338
Manchester 0161 499 1700
|! Selector Euro pe
Spc-iicc r Suuiri
A major supplier of corporate fT
solutions to b truly global customer
boss. Dell Computer Corporation is
renowned for innovative products
and exceptional customer
commitment. A progressive,
multinational front runner and a
leader within its marketplace, Dell
has achieved revenue growth In
excess of 50% per annum.
As a young, dynamic individual
working directly with the European
Tax Manager, you will Initially
focus on value added taxes and
additionally will be expected to
work on a variety of direct
European tax Issues.
A qualified lawyer or accourftara. you
will possess a minimum of three
years' international tax experience
ideally gained in a commercial
environment. A solid knowledge of
European VAT should be
complemented by a thorough
understanding of one or more EU
corporate tax systems. Fluency In
Englsh is essential and a knowledge
of other European languages would be
advantageous. Tenacity, mental
toughness and ambition win provide
you with exceptional career
opportunities within this vftvant global
Corporation.
Candidates Interested in this
outstanding opportunity should
sand/fax their CV (In English) to our
advising consultants Jane Storte and
Mark Pockeie at FSS Europe.
Charlotte House. 14 Windmill
Street, London WlP
20V, united Kingdom,
Fax: 44 171 209 0001
or 44 171 813 9479.
Tel: 44 171 209 1000.
Quoting ref. F333.
FSS
EUROPE
SGS Society G6n6rale de Surveillance Holding S.A. (the SGS Group) founded in 1878,
with headquarters in Geneva, Switzerland, is the world's largest organisation in the
field of testing, inspection, verification and quality systems certification. The Group
operates in over 140 countries with 335 subsidiaries, 1220 offices. 342 laboratories
and 35,000 employees.
The Group's worldwide operations have expanded rapidly during the last years.
Given the increased audit universe, we are looking for complementing our Internal
Audit Function based in Geneva, Switzerland, or Parsippany N.J. USA, with high
calibre and dynamic individuals for the position of
INTERNAL AUDITOR (M/F)
Tasks and responsibilities
• Performing financial and operational review missions
worldwide in the SGS Group universe
• Advising on improvements of operations in terms
of minimising risks, improving quality, efficiency and
effectiveness
• Understanding operational, local and business
considerations
• Special projects, including due diligence work
Profile of the suitable candidates:
Divisional Financial Director
World Class Manufacturing Business
Germany
to DM210,000
Package + Car
Snsriae Medical, an NYSE-listed company, is the leading manufacturer of high-value rehabilitation and recovery products for
the disabled. Established m California in 1983* the c ompany has a r e puta tion Cor excellence in manufacturing and a form
commitment to customer service, underpinned by a p rog ressi ve and forward-chinking style of management. The result has been
an impressive and consistent record of growt h and p r ofitab ility, with operations throughout the USA, sod Europe-
THE POSITION
• Reporting to the Chief Executive of the company’s
DM] 00m German operation, with a dotted- line to the
European Vice-President, Finance.
• Foil functional responsibility for all fina n cia l natters,
including reposting requirements for the US parens*
divisional management iw y mring , budgets, forecasts
systems development.
• Significant strategic exposure, playing a pi votal role in
rhr KMgugsaan e of a complex, highly coat and might-
sensitive business, at a time of considerable change.
• A highly influential and prominent role in a young,
* gr i r l i y *i\^ rapidly -wpnvUng ho s fa ms*
QUALIFICATIONS
• Qualified Accountant, preferably Chartered, aged at least
30 and already operating in a senior line m a na gement
role.
• Fluency in both English and German Is vitaL
• ’Experience in a quality-driven ‘discrete’ manufacturing
environment, pre f er a b ly with international operations.
• Broad-based line management experience, with specific
expertise in the areas of cost control and profit-
improvement- Proactive, able to demonstrate bottom-line
awareneas.
• Strung interp erso nal skills, with the intellect to
contribute to die strategic development of the business.
In te rest e d candidates should write, enclosing full career and salary dentils to the advising consultant, William Grcc ow eH at
Quesoor International Limited, 3 Burlington Gardens. London W1X 1LE, quote reference 1412. Email: www-questormt^om
► QJ 4
QUESTOR INTERNATIONAL
a uuUti rtf Ciw *LC Omr*wj
\v
1 *'
*■ Qualified auditor (CA, CPA, CIA, Expert comptable dipldme)
• Two to five years relevant work experience in an
international environment after gaining audit qualification
• Fluent English and either French or Spanish essential; any
other language desirable
• Willingness to travel up to some 60% and to undertake this
role for a number of years
• Excellent communication and writing skills
• Swiss nationality or Swiss C work permit (for Geneva)
U.S. nationality or Green card (for Parsippany)
For successful candidates this position, clearly offers exciting career
prospects in the SGS Group..
Interested candidates should send their application letters and curriculum
vitae to SGS Soci£t6 Generate de Surveillance S.A.,
Human Resources Division, P.O. Box 21 52, CH-1211 Geneve 7
Interviews will take place late October / early November.
Our dientis a global corporation and a world leader in its market, with
operations in 130 countries and 90.000 employees. Its UK operations contribute
in excess of £300 million to a total turnover of $ 12 billion.
-all •
a i**
N'l« ?
TUB
OPPORTUNITY
Due to promotion, an excellent career opportunity now exists for an
ambitious finance manager to join the senior management team of the Group
Commercial Division. The position reports to the Divisional Director and has direct
responsibifty for four staff. The Division employs in excess of 250 staff and is
responsible for defining and implementing the Group's UK commercial, sales and
marketing strategy.
T H B
C AND 1 JO A T R
,u- y
ABRAHAM * BEASLEY » PRICE • MOBCAM
FINANCIAL* RECRUITMENT ■ SPECIALISTS
The successful candidate will be a qualified accountant or MBA aged
between 28 and 35 with at least three years relevant management experience
ideally gained in a similar role and environment. This is a high profile position
based in the Group's UK headquarters and as such represents a genuine career
opportunity for the most ambitious and able of candidates.
Interested cancfidates should in the first instance send their CV together
with details of their current salary, work and home telephone numbers to Jeff Price
at ABPM, Redridge House, 9 Bailey Lane, Sheffield SI 4EG, Tel: 01 14-278 0011,
Fax: 0114-273 8384. Email: gsl 0f9abpm.oo.uk Please quote reference GS10F.
OFFICES AT BIRMINGHAM, LEEDS,
MANCHESTER, NOTTINGHAM AND SHEFFIELD
Appointments Advertising
■l aooears In the UK edition every Monday, Wednesday & Thursday and in
i the international edition every Friday
For further information please call:
Toby Finden-Crofts on +44 0171873 3456
Senior Tax Advisor
Front Office Role in
Global Investment Bank
Compensation: £60,000 - 1 100.000 + Benefits
Cit\\ London
We axe acting for a leading investment bank
and securities house, which is part of one of
the premier worldwide financial services
organisations. Our client has seen significant
growth across all business units, particularly
in the field of emerging markets. As a result of
this growth a role has been created to provide
transactional and structural tax advice to the
main trading units in Europe with particular
emphasis on global emerging markets
activities.
Specifically the role will involve:
• Responsibility for assisting the business to
structure transactions. You will be viewed
as a deal-enabler and thus you must be
comfortable in a highly proactive role.
• Involvement with the tax based products
team in the bank, playing an active part
from origination to completion.
• Initiation of worldwide tax planning
policies.
The successful candidate is likely to be a
qualified Chartered Accountant or Lawyer
with 5-10 years’ post qualifying experience
within a global organisation. The role could
offer career advancement for candidates from
other financial institutions. Alternatively, it
would suit an applicant seeking a first move
away from a major professional firm in
London, New York or Continental Europe.
Our client is not necessarily looking far
experience within the field of emerging
markets or advice on trade structuring.
However, it is essential that candidates are
commercial and creative in outlook, and show
an enthusiasm to get the deal done.
For further information on this retained
ass i g n ment please contact Jim Birrwell on
0171 415 2800 (outside hours 0171 622 0900),
or forward a comprehensive resume to
Brewer Morris, 179 Queen Victoria Street,
London EC4V 4DD. Facsimile 0171 463 0740.
Brewer-Morris
TAXATION RECRUITMENT SPECIALISTS
l esMw s
The PT can help you reach
addinooal business readers in
France. Our link with ihe
I French b erina g news p aper.
; Los Echos, gives you a unique
recruitment advertising
opportunity to ca pita li s e on
tbcFTs European readership
and to farther target the
French business world.
For information on rates and
further details please
telephone: j
Ibby Finden-Crofts on
+44 171 873 3456 I
Ad Agency
Financial Controller
London W.1
This successful, profitable Advertising and Direct Marketing
Group is urgently seeking a Financial Controller who has the
potential and drive to continue to enhance the value of
the financial function.
ACCA qualified and advertising agency experienced,
this is an excellent opportunity for someone to use their
commercial and technical skills to the full and make a key
contribution to the business as a whole, answering directly
to the Chief Executive-
Salary commensurate with experience.
Apply now to: Mike Wisgard, ATW Group,
No-1 Wardour Street, London W1V 3HE,
or fax 0171 494 2034.
sSparai iffqf-
VIII
FINANCIAL TIMES
FRIDAY NOVEMBER 1 1996
IT Appointments
The logical move.
Principal Consultants - Banking & Finance
EuropeWide - Zurich HeadQuarters
Logica Consulting Group is an elite organisation,
offering strategic fT constancy at the highest
levels of Europe's Banking and France industries.
This is a fast^rowtng business vutich has the tufi
support and backi^ of Logica, the miitHiationat
compffiy with a turnover of £300 mSonand
employing some 4000 people.
Our “b&iguaT approach bridges trie gap
between business requirements and technology
opportunities and is designed to help our
customers tom management strategy into
decisive results.
Logica Consulting Group boasts a number of
prestigious clients and the chalengeisnowto
become qtscWy recognised as one of the top
three Strategic IT Consulting firms.
To help us fulfil this mission, we are looking for
talented individuals with impeccable credentials
and European ambitions. If you are one of them,
we believe that this is the logical move to
further your career.
Your skills win complement the team in one of
our specialist practice areas;
W Consulting
Group
Interpreting business & technology ; We're bilingual
CONSUMER FINANCIAL SERVICES
Our capability is geared towards big names in
Retail Banking, with special focus on the
Customer Service Value Chain, from Customer
Interface through Banking Processes to
Customer Information Management This
involves exarruvng developments in Telebanking,
TeledeHvwy, Electronic Purse, Customer
Resource Management (CRM) and Technology
Ti^isfbrniation, optirrasing benefHs from current
and emerging/lnnovative technologies eg. Date
NSrrcig, IntemeJ/totranet Advanced Call Centres,
Sales and Marketing Systems etc.
INVESTMENT MARKETS
Dealing with business orientated issues in
the front, middle and back offices and the
trading floor.
The protects wffl mdue anything from Trader
Workbench Strategies and Exchange Automation
to Deosjcn Support and Risk Hedging Strategies.
These are challenging roles and you wfl need
practical expertise and knowtedge of market
trends combined with a creative and
ertreprermiaJ approach. You wffl afeo have
excelent academic achievements, be happy to
travel and be fluent in several languages. Your
starc&ig with senior people in major complies
wi have a strong bearing on your success and
so impressive communication skis are essential.
If you woidd welcome a high level of
freedom to exploit your mdtvkfual
expertise and ambitions, we would like to
hear from you. For further inf or mation
please call our advising consultant,
Grace Ellams on +44 (O) 171 242 2010.
Alternatively, send fid career details to
her at Executive Network Consultants Ltd.,
12S High Holbom, London WC1V 6QA.
Fax: +44(0} 171 430 2587.
Emafi; erd@btintemetcom
FT IT Recruitment appears
each Monday, Wednesday
in the UK edition,
and each Friday in the
international edition
For more Information on
how to reach the top
IT professionals in
business call:
Emma Lloyd
+ 44 171 873 3779
Dominic Knowlson
+ 44 171 873 4015
IT in Support of
The Business
Commercial Accountant
to lead key projects
Package to £40,000 + Benefits
Cheshire (Relocation available)
Barclay’s is one of the world's major financial services companies, with capital
assets of over 11.4 billion and employing 87,000 people in over 70 countries. The
Group comprises not only the UK retail bank but spans commercial and investment
.banking as wbII as a substantial asset management business.
Group Operations and Technology {GOT} is a commercially focused multi-
million turnover organisation, responsible for defining the Group's IT strategy.
The financial systems strategy is underpinned by the implementation of Oracle
Financial Applications, and integrated MIS solutions, including exploitation of the
latest OLAP technology. The pace and depth oi this change has necessitated the
recruitment of a high calibre IT orientated qualified Accountant with strong,
proven project management skills.
The key challenge of the role will be the successful management of fT development
projects from inception ru implementation. Success will be measured on the
ability to deliver on time, within budget and to the agreed quality standards.
Naturally, such a rale requires an individual with the ability to lead and motivate a
team, utilising strong skills in issue and change management who can retain a
BARCLAYS
keen focus on delivering the goal and objectives deemed to be in scope. The
Project Manager will have the opportunity to develop true multi-discipline skills,
thereby positioning them for the valuable role of an Accountant who can fully
exploit IT in support of the business.
You will be a graduate calibre Accountant with strong technical knowledge
involving the use and development of IT solutions. Excellent communication skills
and a focused yet lateral approach are prerequisites, along with
demonstrable ability to work to high quality standards and the drive to succeed.
Future career prospects with Barclays Bank pic era first class, Bad interested
candidates should apply, enclosing fall CV, to Andrew Macfcie at Robert Half,
Brook House. Spring Gardens, Manchester M2ZBQ. or telephone 0161 236 0101
(24hr answering service), alternatively fax your CV on 0161 Z36 1024.
E-mail: [email protected]
As retained consultants, any CVs submitted directly to oar client will be
forwarded to Robert HaH.
Robert half.
A Division of Robert Half International
London * Brussels * Paris * Amsterdam ■ New York and over 200 offices worldwide.
INVESTMENT BANKING. FROM
STRATEGY CONSULTANTS - IT
The Boston Consulting Group
LONDON
• The Boston Consulting Group CBCG) is the
leading international consulting firm focused
on developing and implementing strategic
change. Operating out of 56 offices around the
globe. BCG serves many of the worlds' leading
companies.
• BCG has a continuing and growing need to
integrate strategic level IT consultancy into
many of its client services across all business
sectors including financial services.
• BCG wishes to expand its consulting team
by recruiting a number of exceptional IT
professionals from either line or consulting
disciplines, with proven ability to link business
and IT strategy.
Please ipplv a writing quoting reference 1 146
with full career and salary details to.
Alan Mum by
trhilefread Selection Limited
II HlU Street. London W1X SBB
Tel. Cl"! ,290 2043
hnp://*>~«'*v.gbnct .cu.uk/whxtehcid
EXCELLENT PACKAGE + PROSPECTS
• Young and energetic, probably in your mid
20's to early 30's, with an excellent academic
background possibly supplemented by an
MBA. Outstanding track record within a
complex and commercially focused IT
environment necessary.
• Hands-on experience of managing large-
scale IT development/service delivery highly
advantageous. Professional consultative style
required, able to present at Board level.
• The successful candidates will receive
significant training to broaden their skills as
strategic consultants, on BCG's main
consulting career path to Partnership.
Whitehead
selection
a WlUfdMad Nan Group PIT c om p in y
INTERNATIONAL ^
INTERNATIONAL OPERATIONS ANALYSTS
London £20,000 to £35,000 + Bonus + Benefits
Owned jointly by the Financial Times and London Stock Exchange, FTSE International is a small, fast
growing company specialising in the calculation of share indices. FTSE is looking to supplement and
strengthen its international Operations team with three Analysis in the administration of indices.
You will be responsible for calculating share indices on markets globally for use by fund managers and
security traders. You are likely to have 2-3 years experience of working in the financial services market
dealing with UK, European or Far East securities and corporate events.
You must possess a degree or equivalent financial qualification, have effective PC literate and database
administration skills, be a good communicator, and enjoy working within a team environment.
Interested candidates should write with full CV, quoting current compensation to:
Paul Grimes
FTSE International
The Podium
St. Afphage House
2 Fore Street
LONDON
EC2Y 5DA
fS Recmititfeiifell
Works
The FT IT Recruitment section is also available all week
on www.FT.com
17
P
Butterley
ENGINEERING
01773-746 III
FINANCIAL, TIMES
©THE FINANCIAL TIMES LIMITED 1996
Friday November 1 1996
IVECO
TRUCK
.'TOWN'S
INTERNATIONAL TRUCK MANUFACTURER
IN BRIEF
Dresdner Bank
profits up 30%
Dresdner Bank announced a 80 per cent rise in
operating profits to DM1.8Bbn (S1.28bn) for the
first cine months and confirmed plana to open a
direct banking operation next year. Page 20
Shanghai B shares reach record low
The hard currency B
share index in Shanghai
ended at a record closing
low on heavy selling by
foreign investors, disillu-
sioned by poor corporate
performances and Bei-
jing’s repeated reaffirma-
tion of a ban on domestic
investors trading the B
shares. The index fell
0.226 to 47.077 points,
below the previous
'China';'-'. -
ShangtWSEB^Kiex
60 1 — " ' ■
as-
, 6D —
4®'
jua.
ityoK B*—
record closing low of 47.13 points on June 7.
Page 36
Tteco surprises with first-half results
Tata Iron and Steel Co, India's second largest
steelmaker, surprised the market with better
than expected first-half results. The flagship of
the hotels to trucks Tata group lifted net profit
25 per cent to R&L52bn (570.6m) in the six
months to September 30. Page 18
Ko ma t su reports 55% rise in profits
Komatsu, the world's second-largest maker of
constr u ction machin ery, reported a 55 per cent
rise in n on-consolidated recurring profits, up
from a previous Y6.1bn to Y9.5bn ($83m). This
was on sales that were 7 per cent higher at
Y25L4bn. Net profits rose 22 per cent to YbSStin.
Page 18
Mitsubishi Heavy boosted by weak yen
Mitsubishi Heavy Industries, the largest of
Japan's diversified shipbuilding, aerospace and
machinery groups, cited the yen's weakness as a
factor in Its doubledigit profits gr o wt h for the
first half. Page 18
El Al sod-off plans receive setback
El Al. Israel's national airline, confirmed it
expects losses of $100m this year, a development
seen as a setback for the Israeli government's
plans to privatise the company. Page 20
Companies In this Issue
ABN Amro
ANA
Abbey National
Acorn
Airbus Industrie
Alcatel Alsthom
BaM Auto
20
18
24
21
5
20
18
Bayertoche Hypothekn 24
Body Shop
Borealis
Budvar
Budwateer
CANTV
CME
CVRD
Contlco Int
Coots
DCS Holdings
Data General
Den norake Bank
Deutsche Pfandbrief
Deutsche Telekom
33 , 18
20
20
20
22
20
22
8
22
1
22
20
24
23
Discovery Petroleum 23
Dofasco
Dresdner
El Al
Espepebe
GAN
Gazprom
General Electric
Hitachi Chemical
Hitachi Zosen
Horsham
Kuysamer State
KNP BT
KPN
Komatsu
22
20
20
20
2
1
5
18
18
22
20
20
21
18
Mitsui Petrochemical
Mitsui Shipbuilding
Molson Breweries
Monsanto
Motorola
NatWest
Neste
Nikon
Nissan Chemical Inds
Nycomed
Olivetti
Qragen Minerals
PTT Netherlands
Pharmacia
Pharmacia & Upjohn
PhIBpptne Airlines
Philips
Pffldngton
Pratt & Whitney
Premier Ofl
RWE
Roite-Royce
Royal Dutch/SheB
SPT Telecom
SSAB
Sabena
San Miguel
Sehroders
SheH
Stakis
Statoil
Stena Line
Stet
Sumito m o
Sumitomo Metal Mto
Swiss Telecom
T&N
TV Asahi
16 % of Matav earmarked for public offering is valued' at $ 5 Q 0 m
Hungary telecoms group to
By Nicholes Denton in London
Matav, Hungary's national
telecommunications company,
is poised to float within the
next 18 months in one of the
largest initial public offerings
to emerge from eastern
Europe's developing capital
markets.
At current valuations, the
tranche of 16 per cent ear-
marked for the flotation is
worth about 5500m.
This exceeds the 5429.3m
raised by Russia's Gazprom in
the region’s Largest interna-
tional share deal to date.
As a result of the transac-
tion, Deutsche Telekom and
Ameritech, which own 67 per
cent of the Hungarian com-
pany, will lower their stake to
51 per cent.
The deal could be enlarged if
the Hungarian state decides to
decrease its 25 per cent hold-
ing.
The decision by Deutsche
Telekom ftnn Ameritech to pro-
ceed with the flotation has
been confirmed by an invita-
tion to four investment banks
to put in plans for the sale and
pitch for the role of global
coordinator.
The In contention —
CS First Boston. Deutsche
Morgan Grenfell, Merrill
Lynch and Morgan Stanley -
have until November 15 to
develop proposals. Goldman
Sachs, Salomon Brothers and
UBS approached Matav but
were not included.
In December 1998, Deutsche
Telekom and Ameritech paid
5S7Sm tor a stake of 80 per cent
in Matav when the state-
owned telecoms company
became the first east European
operator to be privatised.
From 1994, the Hungar-
ian government, which has
wrestled with one of central
Europe’s highest budget -defi-
cits, looked into raising fur-
ther proceeds through an
international private place-
ment or a flotation of its
remaining holding. Deutsche
Telekom and Ameritech per-
suaded Budapest to wait until
they were further along their
three-year programme of
I nvestm ent in Matav.
To satisfy the- Hungarian
government's need for funds,
the two western, companies
paid $852m in December 1995
for a farther 37 per emit of
Matav.
However, the Hungarian
government specified Deutsche
Telekom ' and Ameritech
should by 1999 float Matav and .
lower their stake to- a bare,
majority- •
Under Hungarian, legislation,
the state must hold at least 25
per cent of-the company but a
. relaxation teexpected. '■
By' tti cou rag to g toe Fln«ftHnr>
of Matav; the government aims
to boost ljqtddhy on the Buda-
pest Stock -Exchange. The
exchange index is up 135 per
cent so for in 1996, but- only 44
companies are listed.
The number of lines per 100
inhabitants bias increased to
26.4 per cent from 14.6 per cent
at the end of 1993. By the end
of tois year Matav will have
- added nearly, im new lines
over the three years.
■ The waiting list for new
lines has fallen from 700,000 at
the end of 1994 to fewer than
200 , 000 .,:
18
18
22
22
3
24
20
18
18
20
21
18
9
16
17
6
8
23
5
23
20
US
23
21
21
16
18
17
16
23. 17
20
17
28
18
21
23
17
By Daniel Ck ean In London
Channel rivalry forces
Stena into nine-month loss
KwokYing Bank
1 TeteQanmark
3
Kwong YH< Bank
1 TateftSnlca
2
Uon Nathan
18 Telia
21
Lonrho
23 Tteco
18 |
Mahindre & Mahindra
18 Toys Seal Inds
8 I
Matav
17 Traub
20
M3er
22 Trteec
22
MiM
22 Unisourca
21
Mitsubishi Chemicals
18 Upjohn
16
Mitsubishi Heavy md
18 Wace
23
Mitsubishi Materials
18 Western Star
22
Market Statistics hupy/ttwn»^r,com
^Annual reports sente
36-31 Foreign exchange
a
Benchmark Govt bonds
24 Gets prices
24
Bond futures and options
U London share service
30-31
Bond prices and yields
Commodities prices
Mmaged txmds sendee
27-29
OMdendft announced, UK
73 Money markets
a
EMS currency rates
25 Now md bond Issues
24
Eurobond prices
24 Bourses
34-35
Rxed interest Mces
24 Recent Issues, \JK
32
FTffiSP-A World Indices
* Short-term Int rates
25
FT Gold Mines Max
FT/tSMA btO bond sve
24 US ttoaest rales
24
FTSE Actuaries share Indices 32 w«« Stock Markets
33
By Greg Mctvor
in Stockholm
Stena Line, the world’s largest
ferry operator, blamed cut-
throat competition on the
English Channel and disrup-
tion from delayed ship deliv-
eries for a foil Into deficit dur-
ing the first nipp months.
The Swedish company saw
pre-tax profits of SKr272m in
the same period last year turn
into a SKr25im ($S8m) loss, on
operating income down 6.5 per
cent to SKr7.lbn from
SKr7.6bn. The deficit was
largely due to a poor July-
Sept ember peak season, in
which pre-tax profits slid from
SKr622m to SKx209m~
The figures were broadly in
line with expectations and
Stena’s shares firmed SKx0.50
to SKr29. The company
repeated its forecast of a
SKx450m full-year loss for 1996.
Stena is expecting higher
returns next year from its
En g lis h Channel routes after
agreeing this month to merge
its cross-channel operations
with P&O of the UK. The deal.
Chief price changes yesterday
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TOKYO (VM)
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an effort to -combat aggressive
price-cutting by Eurotunnel,
the Channel tunnel operator,
awaits regulatory approval.
Price-cutting boosted vol-
umes on the Dover-Calais
route, Stena said, hut took
traffic from other Channel
crossings. Excluding Dover-
Calais, Stena’s total volumes
fell on other routes around
the UK.
Crossings on Stena’s high-
margin Irish Sea routes fell
amid disruptions caused by
delays in deliveries of new
highspeed service (HSS) ves-
sels. The need to re-all oca te
capacity resulted in wide-
spread disturbance, toe com-
pany said. The HSS craft also
suffered running-in problems.
Late delivery of a second
HSS vessel on the Irish Sea
routes meant It missed the
peak summer season.
Mr David Etemore, shipping
analyst at Kleinwart Benson,
the London-based investment
bank, said; “In the ferry busi-
ness, if you miss the key slim-
mer season, you have basically
had it" He said “everything
bad gone wrong” for . Stena in
1996, but predicted a strong
rebound in earnings next year
as benefits begin to flow from
the P&O merger and the HSS
ferries become fully opera-
tional.
Stena said the number of
passengers on all its routes
rose by 8 per cent in the third
quarter. Car traffic grew by 7
per cent, while freight volumes
increased by 1 per cent.
Around the UK, passenger and
car volumes advanced 15 per
cent and freight grew by 3 per
cent
The company said it was
negotiating over the future of
Wests Marin, a Norwegian
shipyard which la budding two
HSS ferries for Stena but this
month went into insolvency
after months of financial prob-
lems.
The vessels, due for delivery
at toe start an d in to e mi dd le
of next year, bad already been
delayed.Stena. which has
pumped SKr65m into Westa
Marin this year, said it was
unclear when toe ships would
arrive
Pharmacia and Upjohn, the
Swedish-US pharmaceuticals. '
company, yesterday issued its
second profits warning in :
three weeks.
Mr Robert Salisbury, chief",
financial officer, said analysts
forecasts for 1997 earnings per
share of about $L35 were up id
10 cents too high.
Three weeks ago the com-
pany said expectations for its
third , quarter results, - pub-
lished yesterday, were too ,
high.
P&U shares, which had risen :
sharply on publication of the .
figures, fell to end SKrl3.5
lower at SKr229.5 in Stocks
holm.
The company said profits .
next year would be affected,,
because growth was “coming'
from, .the tower base” - the ;
analyst
at Merrill Lynch rnTEandoh,-
said the company was alsd
probably being hit by^ tougher
than expected competition.
She said there was increase
ing generic competition for the
anxiety drug Xanax, the steep:.;
ing pfll Balctoa, and .the anti-
biotic Cleocin. The diabetes
drug Micronase was competing'
against generics and powerful
new drugs.
P&U's third-quarter rxt'ef
profit was 5233.7m, down from
5230 An last year, excluding;
$47.6m in non-recurring-
charges related to toe compa-
nies' merger. . ’ - .
. Third-quarter sales rose to
51.72bn from Sl-BSbn, Up 2 per
cent but sluggish by compari-
son with, most -US' and Euro-
pton competitors.
. -Currency • movements
depressed performance. Exclu-
ding exchange rate effects,
sales in the. third quarter
would have grown 4 per cent.
- Third-quarter sales were
boosted, by the launch of
C amp tost a r. for bowel cancer,
andJXalatan, for giauooma. Mr
Salisbury . said Xalatan,
launched in -August in the US.
had 12 per cent of the market
■ Sales of over-the-counter
products rose 27 per cent, after
‘a* 169 per ceut growth in Nlcor-
ette sales. But the rise was
mainly due - to stockbuildU&
ahgadctf toe US; launch.
: v . • 'operhttog
-ftkofeimv eluding .: Conk
- recurring 4tems, rose from 18.6
iof schedule'"with • 3,300 staff
^having left-toe company by the
fend oTthe third-quarter..
Derivatives. of ; two * drugs,
?inriuding 'p&U’s cancer drug
; dp^nfofoto^ haye been found
. to ; prolong -toe lives of ham-
sters and mice infected with
^scrapie' . 4 " ’a sheep disease
'abated fo.K^rbr mad cow
~ d&ease, blew Scientist ' maga-
zine said yesterday.
Lex, Page 16
TV Asahi
to limit
Murdoch
alliance’s
influence
By MHchiyo Nakamoto v
In Tokyo \ ■
Japan's Asahi National
Broadcasting, in . which- News
Corporation has a 21.4 .per
cent stake with Softbank, has
moved to curb the influence of -
the media group, headed, by :
Mr Rupert Murdoch, and its
Japanese partner. "• .•
Mr Kunto Ito, president of
the broadcaster known as TV
Asahi, said acceptance of
part-time directors from the .
News Carp/Softbank alliance
would be postponed until it
accepted restrictions
requested by other sharehold-
ers. TV Asahi was to accept
two directors from the part-
nership at an extraordinary
meeting on November 7.- :
The action highlights- the
closed nature of Japanese
broadcasting, which ' was
shaken when News Carp and
Softbank, the software and
publishing group, emerged in
June as leading Investors in
TV Annin, one of the- five main
national broadcasters.
- Mr Murdoch's arrival trig-
gered alarm in the industry,
which feared be planned to
take oypr TV Asalu or its sis-
ter companSfftjfre Asahi news-
paper. Although Mr Murdoch
and Mr Masjqroshi Son. who
heads Saftbs&k. have stressed
that tbefr sta& in TV Asahi is
friendly, the^group's reaction
indicates itfeirtill concerned.
Mr Ito said * some large
shareholders had asked that
News Corp and Softbank
accept limits on the -activities
of shareholders, including
non-interference in the broad-
caster's business activities .and
restrictions on the sale- and
acquisition of further shares.
“It has been tacitly agreed
. among large shareholders that
there wfll be no participation
in management and - no- pur-
chases of further shares in TV
Asahi,” Mr • Ito «aid. The
appointment of directors' from
the alliance would therefore
have to be put off until an
agreement- could be agreed
with the new shareholders.
Softbank said it would con-
sider the proposal,, while News
Corp officials in Tokyo were
not available for comment.
• Nippon Broadcasting, a
radio station which is part of
tile Fuji Sauket media group,
is to apply for a listing on toe
second section' of the
Stock Exchan ge in
Sehroders 9 underwriting
move follows attack on City
N«w Yoifc and Toronto pricre ■* 1330.
By John Gapper, Watem
Lewis and Christopher Price
Sehroders, the UR merchant
banking group, yesterday
introduced a more competitive
method of underwriting UK
share issues in response to
criticism of traditional City of
London practice by the Office
of Fair Trading,
UK banks and large Invest-
ment institutions want to
avoid the system of fixed
underwriting fees being
referred to the Monopolies and
Mergers Commission on the
grounds that it te too costly for
companies raising capital.
The Sehroders innovation
was part of a 2222m (5362m)
rights issue by the hotels
group Stakis. a tender among
40 investors Involving part of
toe underwriting fees saved
Stakis £400,000, the merchant
bank said.
An OFT report last year crit-
icised the system of fixed
underwriting fees totalling 2
per cent or more being levied
on companies raising capital.
It te now close to conducting
an investigation into the prac-
tice and Is expected to decide
by the end of the year on
whether to refer the fixed
underwriting fee approach to
the MMC. Some critics of the
system believe that changes
wfll come too late to avoid a
referral to the MMC.
Stakis would have normally
been charged £5m for the
rights issue, which would
Cover the merchant hanlt and
big investors guaranteeing
that the shares would all be
bought at the set price and the
work done by the broker.
"We welcome any move
which saves us money. We like
to think of ourselves as an
Innovative company so are
happy to be part of this new
type of underwriting, " Mr
*We welcome any move
which saves us money. We
... are happy to be part of
fills new type of
underwriting’ David Mtetefe,
Stakis chief executive
David Michels, Stakis chief
executive, said.
The Stakis deal, to which
Merrill Lynch was broker, fol-
lows an intervention by the
UK’s National Association of
Pension Funds, which wrote to
its members to urge them to
be flexible to new forms of
share sub-underwrlting.
Traditional me rchant banity
such as Sehroders, with a
strong list of corporate clients.
are regarded as having most to
lose from the end of fixed fees
which could make tt easier for
newcomers to compete.
Mr John Rogers of the
National Association of Pen-
sion Funds said the Stakis deal
“could be the tip of the ice-
berg”, and other innovations
in issues were likely to follow.
"We hqpe the OFT will note
this development," said Mr
Rogers.
Prudential Corporation,
which confirmed that it had
participated in the tender
organised by the brokers, said
that “as shareholders in very
many UK companies, we
strongly support moves to
reduce the cost of capital for
those companies".
' “We believed it was in every-
body’s interests to test the
demand in the UK market
rather than simply have an
academic debate about pric-
ing." said Mr Robert SwanndL
head of UK corporate finance
at Sehroders.
The rights Issue te to be used
to part-fund the acquisition of
Metropole Hotels from Lonrho
Stakis wfll pay £327m for the
five-strong four-star rhain,
which will increase the num-
ber of rooms that Stakis oper-
ates from 5^00 to 7,760.
Lex, Page 28
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IS
FINANCIAL TIMES
FRIDAY NOVEMBER 1 1996
COMPANIES AND FINANCE: ASIA-PACIFIC
Weak yen lifts profit at Mitsubishi Heavy
By William Dawkins
in Tokyo
Mitsubishi Heavy Industries,
the largest of Japan's diver-
sified shipbuilding, aero-
space and machinery groups,
yesterday cited the yen's
weakness as a factor in
double-digit profits growth
for the first half, and an
improved profits forecast for
the whole of 1996.
The group, the industrial
nucleus of the Mitsubishi
corporate keirvtsi ; yesterday
said it expected: jeij to
High public
spending
helps buoy
Komatsu
JBy^riichiyo Nakamoto
Komatsu, tbe world's
second-largest maker of con-
struction machinery,
reported a 55 per cent rise
in non-con so I ida ted recur-
ring profits, as public spend-
ing in Japan mid infrastruc-
ture development in Asia
supported a steady rise in
overall sales.
Komatsu lifted recurring
profits from Y6.1bn to
Y9.5bn (S83m). on sales 7
per cent higher at Y251.4bn.
Net profits rose 22 per cent
to Y5.3bn.
The company said that,
despite a weak domestic
market, sales of construc-
tion equipment were lifted
by the high public spending
introduced as part of the
government’s economic
stimulus progr a mme.
Overseas, Komatsu was
helped by the strength of
the US economy and infra-
structure projects in south-
east Asia, which triggered
strong demand for bull-
dozers.
Sales of domestic indus-
trial machin ery fell 26 per
cent in the term.
Komatsu expects the sec-
ond half to be difficult amid
economic deceleration in
Asia and a slowdown in cap-
ital investment by semicon-
ductor manufacturers.
Nevertheless, it expects
aggressive marketing
overseas and at home to
help it raise sales for the
full year, from Y500.9bn to
Y530bn. It forecasts recur-
ring profits of Y24bn, com-
pared with Yl7.9bn, and net
profits of Y12bn, against
Yl0.4bn.
stay near its current rate of
around Y110 to the dollar in
the second half, rather than
the Y105 on which it had cal-
culated previous projections.
On that basis, it expects
unconsolidated recurring
profits - before tax and
extraordinary items - to rise
15.5 per cent to a record
Y192.5bn ($1. 7bn) for the
year to March, instead of the
Y185bn it had forecast ear-
lier. Mr Yoshihisa Tsuda,
vice-president, said the yen's
Call was helping export prof-
its. which was mainly why
MHI’s overall gross profit
margins were expected to to
rise to 14.7 per cent this year
from 13.8 per cent last. Each
rise of one yen against the
dollar, when sustained over
a year, adds YZbn to MHTs
annual recurring profits. Mr
Tsuda said.
Recurring profits in the
first six months to Septem-
ber climbed 12.6 per cent to
Y89.1bn. on sales up 10.2 per
cent to Yl,l77bn. Turnover
in the shipbuilding and steel
structure division, represent-
ing less than one-fifth of
sales, rose just 0.6 pea: cent
to Y220bn t as ship orders
began to weaken in response
to a decline in demand for
new vessels. But sales at the
aircraft and special duty
vehicle division rose nearly
70 per cent to YllSbn. a con-
sequence of Increased sales
of components for the new
Boeing 777 airliner.
MHTs two smaller rivals,
Hitachi Zosen and Mitsui
Shipb uilding also reported
results yesterday, but they
refrained from celebrating
the yen's decline with an
upgrade of profits forecasts.
They were either being con-
servative. or have low-
margin shipbuilding orders
in their yards as a result of a
recent decline in prices, said
Mr Matthew Ruddick, ship-
building analyst at James
Capel in Tokyo.
Hitachi Zosen is forecast'
mg a 14-8 per cent rise in
full-year recurring profits, to
Y30bn, on sales up 8-3 per
cent to Y500bn. In the first
halt Hitachi Zosen's profits
rose 0.7 per cent to YS.lbn.
Margins were constrained by
a sharp rise in sales promo-
tion costs, the company said.
Total turnover edged up a
mere 1.1 per cent to Yl57bn,
held back by a 4&2 per cent
drop in turnover at the com-
pany's shipbuilding division.
Mitsui Engineering and
Shipbuilding yesterday fore-
cast an 8 per cent rise in
recurring profits for the frill
year, on sales up 27.2 per
rent to Y370m. In the first
half, recurring profits rose 66
per cent to Y2.Q3bn on turn-
over up 15.4 per cent at
Yl34bn.
Cost cuts offset higher fuel bill at ANA
By MSchryo Nakamoto
in Tokyo
ANA, one of Japan's leading
airlines, brushed aside a
sharp rise in fuel prices to
report a firm increase in par-
ent pre-tax profits for the
first half on the strength of
higher passenger levels and
cost-cutting measures.
The company lifted recur-
ring profits 33 per cent to
Yl7.9bn ($157. 2m). on reve-
nues up 5 per cent at
Y450.7bn. Net profits
climbed 33 per cent to
Y8.4bn. However, ANA's per-
formance, which contrasts
with that of Japan Airlines,
the international carrier
which reported lower profits
this week, did not help its
share price yesterday. Inves-
tors were disappointed by a
lower than expected full-year
forecast, and the shares and
fell Y12 to a new low for the
year of Y949.
In the first half, ANA was
night paths
A share prices rotative to the
Nikkei 225 Average
125 — — — .
ZM
Souca: omestraoni
helped by expansion in
routes and better results in
the first and business classes
of its international
operations, which it attri-
buted to a pick-up in the
economy and the introduc-
tion of 180-degree reclining
seats in the first class
section.
International passenger
Class act: impr o ved sales in high-priced sections helped ANA beat trends
numbers rose 17 per cent
over the same period last
year, while international
revenues were up 13 per
cent
Domestic passenger vol-
ume and revenues also rose,
although not as strongly as '
in the international busi-
ness. The carrier's perfor-
mance In the Japanese mar-
ket was supported by price
discounts and new services.
ANA, like JAL. has been
hit by higher foe! prices,
which added Y13bn to fuel
costs compared with the pre-
vious first half. However,
ANA believes it can offset
the higher costs with a cost-
reduction exercise In which
it plans to cut overall costs
by Y30bn in the year.
Nevertheless, the airline
forecasts full-year revenues
at YSSObn, or Y3bn lower
than expected, while recur-
ring profits will be Y17-5bn,
or Ylbn below earlier fore-
casts. ANA blames the slow
recovery of the economy and
intensified competition in
tbe domestic market
Slow sales hit San Miguel
By Edward Luce in Manila
San Miguel, the Philippines'
largest beer and food com-
pany, said net earnings after
non-recurring items fell 23
per cent in the first nine
months, to 2.99bn pesos
($113.7m) because of lower
beer sales and a depressed
form sector.
Analysts said the compa-
ny's mounting debt - with
financing charges rising 120
per cent to 2.01bn pesos from
January to June - and flat
beer sales combined to push
earnings down. Net revenue
rose 9 per cent to 61bn pesos.
San Miguel’s B-shares
closed flat yesterday at 95
pesos.
"San Miguel is having a
very bad year because of the
depressed beer market and
higher raw material costs,”
said Ms Alexandra Connor,
an analyst at W. . Carr. "The
company has also been hit
by higher tax charges and
lower than expected reve-
nues from its overseas
operations."
For the year as a whole,
analysts forecast that net
profits are likely to foil at
least 10 per cent for the year
as a whole.
With its B-shares trading
at a price /earnings ratio of
36 - almost twice the Philip-
pine composite average -
brokers say San Miguel Is
trading at an almost 100 per
cent premium to the market.
However, the company's
$1.6bn overseas investment
programme, which includes
breweries in China, Vietnam
and Indonesia, is not expec-
ted to reap dividends until
1998. San Miguel says the
proportion of revenues from
overseas operations will rise
from 13 per cent in 1996 to 30
per cent by 2000.
The company, which
expects to be hit by a change
next year in the excise tax
on "sin products” such as
beer, said growth in most of
its subsidiaries, including
Coca-Cola Bottlers Philip-
pines and San Miguel Prop-
erties, was healthy. The
price of raw materials was
also falling because of the
start of recovery in the farm
sector.
Tisco surprises
with 25% rise
ON THE ROAD TO ANOTHER
UNREATARLE PERFORMANCE
U na ud Hed Financial n e w ilt s (Provisional) for the
Six Months ondad September 30, 1090
AccouiUng
Six Months
Six Months Six Months
Year ended
ended
ended
ended
31.03*6
3008*5
30.09-96
304SL96
(Rs. In MBtorts)
(Rs.tnMHonsj
(Rs. fri Kllkins} (US tin Mfflkms)
Net Salas (Including excise duty)
and income from operations
27,938.0
12.810.5
15,029.2
447.618
Other Income (Net)
1,382.4
757.7
1,095.6
30.595
Total rales and other Income
29,320.4
13^6A2
17,12441
47&213
Total expenditure
22,533.1
10,448.7
13,079.3
365.242
Interest
99.0
41.8
38.6
1.078
Gross profit after Interest but
before depredation & taxation
6,6884
3,077.7
4,006.9
1114)93
Depredation
737.1
406.9
558.0
15.582
Profit before tax
5.951.2
2.670.8
3,448.9
96.311
Provision for taxation
1.77O.0
895.0
1,190.0
33.231
Net Profit
4.181.2
1,7754!
3^25&9
634)80
Profit after prior period
adjustments
4,168.4
1,748.7
2,247.4
62.759
Earnings per sharo-arauiatfsed (Ra/US S)
5137
4&94
56.47
1.577
Paid up equity share capital
Reserves (excluding revaluation
795.9
795.9
795.9
22.226
reserves as per balance sheet of
previous accounting year)
13,287.0
NOTES: 1. The above results have been taken on record in a meeting ol Board otDtrectors held on 3istOdober, 1996.
2- The total two and Bireewheeter production and saladuring the Bret six months was 758599 and 722467 respectively.
The correspondmg figues forffie six months ended 30th Septamtoer. 1995 were 621 .498 and 613979.
3. The stock of vehicles on 30th September, 1996. was 45.166 as against 21,753 on 30th September, 1995.
4. The total exports ol tfwcompany In Vie first six months were Rs.875.1 m*on aganst Rs.932.1 mtton (toting ffieste
months ended 30th September, 1995.
5. • The conversion rata for currency has been taken as US Si
-Rs. £.81.
BY ORDER OF THE BOARD OF DIRECTORS
FOR BAJAJ AUTO LUSTED
MUMBAI
RAHUL BAJAJ
DATE : October 31, 1996
CHAIRMAN & MANAGING DIRECTOR
By Tony Tassefl
In Bombay
Tata Iron and Steel Co
(Tisco), India's second larg-
est steelmaker, surprised the
market with better than
expected first-half results.
The flaguMp of the hotels
to trucks Tata group lifted
net profit 25 per cent to
Rs2.52bn ($70. Gm) in the six
months to September 30.
from Rs2.0ibn in the same
period last year. The net
profit was weU above market
consensus of expectations of
around Rs2jjbn, and defied
some even gloomier fore-
casts made earlier in the
year.
The results added to an
emerging trend of better
than expected first-half fig-
ures from Indian companies
over the past two weeks,
after earlier forecasts of a
slowing in corporate earn-
ings growth. However, ana-
lysts said that as the first-
half reporting season prog-
ressed. more negative results
were expected.
Tisco’s net' profit would
have been even higher but
for the imposition of a 12.9
per cent minimum corporate
tax by the Indian govern-
ment in its July budget. This
lifted its tax hill from
nothing last year to
Rs3725m.
Mr Anurag Matbur,
analyst with Peregrine
Securities, said Tisco had
managed to shrug off cost
increases with improved
sales volumes, and a 4 per
cent average rise in product
prices in April. This saw
operating margins widen
slightly, to 20.6 per cent com-
pared with 20.4 per cent last
year.
Tisco boosted its sales by
RsS0-2lbn in the first half,
from Rs24.96bn. Production
rose marginally, to 1.33m
tonnes from 1.32m tonnes.
However, the overall volume
of steel increased 8 per cent
to 1.194m tonnes from 1.108m
tonnes as Tisco sold down
inventory levels.
Sales of hot rolled colls
rose from 282,000 tonnes in
the first-half to 436,000
tonnes. Cement sales also
rose, to 629,000 tonnes from
436.000 tonnes.
Shares in Tisco fell Rs6.75
to RslSO ahead of the release
of the results, after the close
of trade. However, in
unofficial after-hours
trading, the stock climbed
back to Rsl83 in response to
the figures.
ASIA-PACIFIC NEWS DIGEST
India automakers
ease industry fears
Concerns over a potential slowdown to the fodlan .a «to
Industry have been eased by strong tot-haff rratots from
two leading sector companies, Bajaj Auto and Mahtodra &
Mahtodra. Bajaj Auto, the world's largest manufacturer
of scooters, lifted net profits 27 per cent toRs2.25bn
($G3m) in the six months to September 30, from Ksi.77Dn
in the same period last year.
Mahtodra & Mahtodra. the utility vehicle maker which
is now producing Escort cars under a Joint venture witn
Ford, lifted net profit by 25 per cent from Rs738.im to
Rs924_3m. Analysts said both sets of results were largely
to line with expectations, and had eased fears of an
slowdown in demand for vehicles and inventory build-ups
amid a slowing to economic growth this year.
Tony TosseO. Bombay
Tough year for Lion Nathan
Lion Nathan, the New Zealand brewer, reported a 25.7 per
cent drop in earnings to NZ$150.4m (US$l06.im). which it
blamed on a “tough” year in its Australian brewing
busin ess , sharply higher tax and currency chan ges.
However the company, the biggest liquor group In
Australia and New Zealand, said its expansion into China
was going well, and that the New Zealand liquor and soft
drinks businesses showed improved ear nin gs.
F-nrainpg for the year at the Australian brewing
operations - which include XXXX, Tooheys and Swan -
fell 243 per rent to A$243.4m (US$19Sm>. although sales
revenue rose slightly to AS1.5bn. Terry Hall Wellington
Japanese chemicals mixed.
Japanese chemical companies yesterday reported mixed
interim results, amid sluggish demand for petroch emi cal
products and synthetic fibres, rising costs for raw
materials, and higher capital spending.
Mitsubishi Chemicals, the country’s largest general
rfripmi rials manufac turer, announced a 98.2 per cent
plunge in unconsolidated recurring profits to Y2.19bn
($19 .3m), because of declining markets for its mainstay
petrochemical products, and rising prices of raw
materials.
Mitsui Petrochemical Industries, the leading maker of
synthetic textile materials, suffered a 10 per cent fell in
unconsolidated recurring profit, to Y7.65bn. Net profits
fell 1 per cent to Y5.31bn on sales of Y153.85bn. down 3.7
percent.
Hitantii Chemical, a synthetic resins processor and
producer of molded parts for vehicles and housing
equipment, reported an increase in interim earnings in
spite of a slight fall In sales. Unconsolidated recurring
profit rose to Y5.5bn from Y4.8bn a year ear lira-, while
sales were Y125.6bn, down from last year's YL27.2bn. For
the full year, Hitachi Chemical expects recurring profits
of Yll.2bn on sales of Y257bn.
Nissan Chemical Industries, meanwhile, reported
robust naming s growth on increased exports of its core
chemicals, helped by the dollar's rise against the yen.
Unconsolidated recurring profit rose 25.7 per cent to
Y2.16bn. on sales of Y44.9bn, up 1.4 per cent. Net profit
grew 28.8 per cent to Y969m. Gioen Robinson, Tokyo
Mitsubishi Materials surges
Mitsubishi Materials, Japan's leading manufacturer of
metals and ceramics, reported an increase of 90.4 per cent
in first-half unconsolidated recurring profit, to Y5.13bn
($45m), on brisk sales of cement and silicon, the main
material for microchip production. The weakening of the
yen against the dollar, and continued low Interest rates to
Japan helped boast the result.
Sales to the first half rose 3.5 per cent to Y361.88bn, on
rising exports. Net profit surged 288.2 per cent to Y2.21bn,
or Yl.94 per share.
Japan's thlrd-largest copper producer, Sumitomo Metal
Mining, also announced Increased first-half profits of
Y6.48bn, up from Y2.85bn, while sales edged up to
Y2QQ.2bn from last year’s Y198.7bn. For the full year to
March, Sumitomo Metal expects recurring profits of
Y12bn on sales of Y410bn. Given Robinson
Nikon weathers chip downturn
Nikon, the Japanese maker of cameras and semiconductor
manufacturing equipment, weathered the downturn to
the semiconductor market, and doubled recurring profits
in the first half, to YlO.Sbn ($92m). The increase came on
the strength of buoyant demand for its steppers, which
are used to manufacture semiconductors. Net profits
totalled Y5.8bn, compared with Y2J3bn a year earlier.
Parent company sales rose 31 per cent, to YlSl.Bbn. The
rise was attributed mainly to an increase to sales of its
semiconductor mantoacturing equipment, which
commands high prices. Michiyo Nakamoto, Tokyo
Orogen institutional offer at A$2
By Nikki Tait in Sydney
The institutional sale price
for shares to Orogen Miner-
als. the company set up to
hold the Papua New Guinea
government's interests in
various local resource pro-
jects. was set yesterday at
AS2 a share - a 17.6 per cent
premium to the price at
which they were offered to
the general public to Austra-
lia and New Zealand.
The institutional price val-
ues Orogen at A$642.5m
(US$508. 7m; and raises
around A $237. 7m of new cap-
ital for the company. This
will be used to part to com-
plete Orogen 's purchase of a
20.5 per cent stake in the
Go be oil fields, due to come
on stream in 1998.
After the sale, the govern-
ment-owned Mineral
Resources Development
Company will continue to
own a contro llin g 51 per cent
stake in Orogen. The
remaining shares are due to
start trading on the Austra-
lian Stock Exchange this
morning.
Mr David Beatty, Orogen’s
Canadian-born chairman
and a former economic
adviser to the PNG govern-
ment. said yesterday the
company had been
“delighted" with the interest
shown to the offer. Accord-
ing to Orogen, more than 360
institutions applied for more
than A$2bn of shares. The
institutional demand was
spread across two dozen
countries.
Orogen said that of the
153.7m shares put up for
sale, about one-fifth would
go to Australian retail Inves-
tors, who were offered
shares at a fixed price of
AJl.70. A further one-fifth
would go to retail and insti-
tutional investors in Papua
New Guinea. They were also
offered shares a fixed price,
set at K1.57 for the first 2,000
shares and at K1.75 beyond
this.
The remaining 60 per cent
will be allocated at A$z a
share to institutional inves-
tors - both PNG-based and
international - who applied
under the global offering,
Orogen said yesterday it
was particularly pleased that
6,500 retail investors to PNG
had applied for shares. In
total, about 30 per cent of
shares being sold should end
up to PNG-based hands. At
present, the country does
not have a stock exchange -
although the government
has expressed enthusiasm
for establishing one - so this
stock will have to be traded
through Australia.
The Orogen float is one of
the first privatisations to the
resource-rich but economi-
cally troubled Pacific coun-
try. to 1995, PNG agreed a
"structural adjustment pro-
gramme” with the World
Bank in return for financial
support, although there has
been dispute over PNG's
progress and a second loan
tranche has been withheld.
The resource projects in
which Orogen has invest-
ments include tbe Porgera,
Minima and Lihir goldmines,
and tbe Kutubu and Go be oil
projects.
Production up by 22% • Turnover up fay 26% • Profit up by 27%
@bijart!lli
Akurdi, Pune 411 035. INDIA.
rmfihhd/Mii<q/HAlJ964S
SINO LAND COMPANY LIMITED
US$200,000,000 5% Convertible Bonds due 2001 (“Bonds”)
NOTICE TO BONDHOLDERS
The Directors ol Slno Land Company Limited (Hie Company - ) on 1st
October, 1996 proposed a final dividend ol HKS0.12 per share [with an
option fcr scrip dhrtdend) lor the year ended 30th June, 1996 to shareholders
whose names appear on the register ol members on 22nd November. 1996.
This final dtvkjend Is payable on 20th December, 1996.
This Anal dividend Is subject to the approval ol shareholders ol the Company
al the Annual General Meeting to be held on 22nd November, 1996. The
dividend warrants wB be despatched on or aboul 20th December, 1996.
The register of members ol the Company wfl be dosed bom 18th November,
1996 10 22nd November, 1996 (both dates Inclusive).
Registered holders of existing Bands who wish to exercise their conversion
nghts attaching to their Bonds so as to be entitled to the said final dhndand
should lodge the property completed and signed conversion farms together
with the bond certificates with their Agent so as to reach the Company
before 4.00 pm (Hong Kong time) on 22nd November, 1096.
By Order of the Beam
EriclpSai K wrong
Secretary
3Tst October 1996 Hong Kong
flSlii!333S3QB9i!3Q.3B
Residential Property Securities No.4 PLC
£?XKOObflO0 £180,000,000
Class Al Notes Class A2 Notes
Mortgage Backed Floating Rate Notes due 2023
In accordance with the protisions of the Note*, notice is hcrcfcr men
that for the three month period 3ht October 1996 to 31st Julv 1997.
the Class Al Not® and cl** A’ Notes will car™ u, imcrest ralc of
6.4312S?b and 6.506251 d per annum respectively. The interest
I P avablc per 1100.000 Note will be A762.00 for the Class Al Notes and
£1.639.93 lor the Class A2 Nut«
^ancial TIMjes
FRIDAY NOVEMBER 1 1996
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Merrill Lynch
on opening markets
by opening
es
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Asia, knowledge is a powerful economic development
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20
t
FINANCIAL TIMES FRIDAY NOVEMBER l 1996
EUROPEAN NEWS DIGEST
Strong demand
lifts Borealis
Strong demand for raw materials for the plastics
Industries boosted third-quarter profits at Borealis, the
polyolefins joint venture between Norway's StatofI and
Finland's Neste with its headquarters near Copenhagen-
Third -quarter pre-tax profits were DKr302m <S52_2m),
taking profits for the first nine months to DKr466m
against DKr2.99bn after nine months bust year. In the
third quarter of last year, when industry margin were
very high, profits were DKr636m.
Sales for the quarter fell 1.7 per cent, from DKr4-14bn
last year to DKr4.08bn, while after nine months sales were
down 16.7 per cent, from DKrUL84bn to DKrll-54bn,
Borealis said the third-quarter improvement was driven
by higher volume sales, better prices and cost reductions.
Toward the end of the quarter, highe r feedstock prices,
reflecting strong prices for crude oil, partly offset higher
polyolefin prices, the interim statement said.
The group said its "value for money" improvement
programme, aimed at improving processes and efficiency,
had already achieved Its target for the year - a net
benefit of DKrSOOm. As a result of the programme, fixed
costs were on a f alling trend.
An important next step in the value for money
programme is the transfer of small-volume sales In
Europe to the European chemicals distribution group,
Ashland Plastics, which will leave Borealis to concentrate
on marketing to its big customers. The transfer takes
place in the current quarter. Borealis said the early days
of the fourth quarter had brought further improvements
which would contribute to profit s for the year.
Hilary Barnes, Copenhagen
RWE wins telecoms licence
RWE Telliance yesterday became the second German
company to be awarded a licence to provide a nationwide
telecommunications network in competition with
Deutsche Telekom, the post and telecoms ministry
announced yesterday.
The company, a subsidiary of the RWE power supply
group, will be able to provide liberalised services such as
data transmission on its already existing 8,000km
fibre-optic cable system. A public telephone service will
have to await full liberalisation of the German
telecommunications market from January 1998.
The ministry awarded a nationwide licence to Vebacom,
the telecoms subsidiary of the Veba conglomerate, last
month and has also awarded eight regional licences. The
European Commission stipulated that two nationwide
licences should be issued by today as one of the
conditions for allowing Telekom to introduce corporate
client rebates. Peter Norman. Bonn
CME increases US offering
Central European Media Enterprises (CME). the US
pioneer of private commercial television in eastern
Europe, has increased its US stock offering from 3m to
4 .Sm shares in response to strong investor demand. The
issue has been priced at $27.50 a share, which would allow
the company to raise gross proceeds of $132m. CME,
which began broadcasting in the Czech Republic with
Nova TV in February 1994. is Nasdaq-quoted and is
controlled by Mr Ronald Lauder, one of the heirs to the
Estee Lauder cosmetics fortune.
The underwriting group for the share issue, led by
Schroder Wertheim. Prudential Securities and Smith
Barney, has been offered options to purchase an
additional 720,000 shares, which could increase total gross
proceeds from the issue to about $l50zn.
CME is co-owner of the leading commercial television
stations in the Czech Republic. Romania. Slovenia and
Slovakia and has growing interests in Ukraine, where it
has plans to apply for licences to develop a new national
television station. It is expected to be one of the
front-runners in the forthcoming tenders for national
licences in Hungary, and last month was awarded Its first
broadcasting licences in Poland, the biggest single market
in central Europe.
The group has previously raised gross proceeds of
$168m. from an initial public offering in October 1994
($76m>. and a second issue in November last year ($92m).
CME and its joint venture partners are broadcasting to
86m people, including 77m in eastern Europe and 9m in
Germany. In Romania, the group is seeking to expand its
operations from TV into telecoms.
Kevin Done, East Europe Correspondent
Traub unit bankruptcy filing
Traub. the German machine tool maker, said its
wholly-owned subsidiary Heckert Chemnitzer
Werkzeugmaschinen had filed for bankruptcy yesterday
in Chemnitz, Germany. The court appointed Mr Klaus
Siemon temporary receiver, said Traub. which on October
15 filed for insolvency owing to an "inability to pay" its
creditors, of which the largest is Deutsche Bank. If talks
with the creditors on a repayment scheme fail. Traub
could be forced into bankruptcy. AP-Dow Jones, Bonn
Nycomed revamp welcomed
Shares in Norwegian pharmaceuticals group Nycomed
rose strongly yesterday on the company’s announcement
of a series of measures to cut costs and restructure
operations. Nycomed's shares surged NKr5.50. or 6 per
cent, to NKr88.50. The group said it expected to make
savings or NKr600m i $94 :2m) from a new programme.
Focus '93. designed to adjust the group's strategy to
reduce costs in some areas and Increase investment in
others. The savings are expected to be take effect by 1998.
"This is what the market has been waiting for." said
one Oslo-based broker. “Restructuring, cost-cutting and a
refocus. The market is bullish on this. In the short run.
we see potential of la share price for the A stock] of
NKrlOO." Nycomed announced the programme while
posting 1996 nine-months pre-tax profits down 32 per cent
on last year, from NKrl.32bn to NKr898m. Reuter, Oslo
Alcatel sells Lafarge stake
Alcatel Alsthom, the French power and electronics group,
said it had sold its 24! per cent stake in Lafarge to Lafarge
itself for FFr650m <S129.5m). The 2.12m shares changed
hands for FFr310 each. The sale was part of Alcatel's
divestment programme, announced by Mr Serge Tchuruk,
chairman and managing director, which is expected to
bring in FFrlObn by the end of the year. AFX News, Paris
Snecma buys out subsidiary
Snecma. the French aviation engine group, yesterday bid
FFr625 each Tor all outstanding shares in its subsidiary
Soci6te Europ£ene de Propulsion, in which it holds a 51426
per cent stake, the French bourse authority SBF said. SEP
shares, which have been suspended on the secondary
market since October 23, will remain suspended until
further notice. AFX News, Paris
ABN Amro arm in SA move
ABN Amro, the Dutch bank, said its securities subsidiary
ABN Amro Hoare Govett, owned jointly with Kagiso
Financial Services of South Africa, acquired a 40 per cent
interest in South African stockbroker Huysamer Stals.
ABN Amro also acquired a minority stake in Kagiso
Financial Services, whose largest shareholders are
N.M. Rothschilds & Sons and Kagiso Trust Investment
company of South Africa. ABN Amro declined to
comment on how the 40 per cent interest in Huysamer
Stals is divided between ABN Amro Hoare Govett and
KFS, or on how big a stake it is taking in KFS.
AFX News. Amsterdam
COMPANIES AND FINANCE: EUROPE
Dresdner confirms direct banking plans
By Andrew Fisher
In Frankfurt
Dresdner Bank yesterday
announced a 30 per cent rise
in operating profits to
DM1.89bn ($1.25bn) for the
first nine months and con-
firmed plans to open a direct
banking operation next year.
The improved result was
in line with the performance
at the halfway stage,
although Mr JOrgen Sarra-
rin . chairman, said recently
growth had slowed in the
third quarter. The bank
repeated its forecast that the
full year’s result would show
a “marked double-digit" per-
centage increase. The shares
fell 50 pfennigs to close at
DM40.50.
The German bank has
already made nearly as
much profit in the January-
September period as in the
whole of 1995, when operat-
ing profits rose 22 per cent to
DM1.99bn. The improvement
reflects the first- time inclu-
sion of Kleinwort Benson,
the UK merchant bank
acquired last year.
Commission profits
remained buoyant, with a 42
per cent jump to DM2.82bn.
reflecting strong securities
business. Kleinwort Benson
alone lifted the bank's fee
income by more than 25 per
cent Interest income was 8
per cent higher at DMSbn.
Own-account financial trad-
ing profits were 15 per cent
lower at DM456m. but the
bask said profits yet to be
realised would lead to a rise
of at least 10 per cent for the
full year.
The integration of Klein-
wort Benson pushed costs up
18 per cent to DM6. lb m the
rise would have been 5 per
cent without the UK mer-
chant bank. Loan-loss provi-
sions were 10 per cent higher
at DMB57m - with further
funds set aside for risks
among medium-sized compa-
nies - while profits from
securities in the liquidity
portfolio rose 105 per cent to
an “unusually high"
DM6G5m. This followed sales
of bonds and industrial
shareh ol ding s of less th an 5
per cent.
Mr Sarrazin said Dresd-
ner’s new direct banking
operation, to be run from
Duisburg in the Rohr region,
would start in the second
half of 1997 and offer attrac-
tive products and a high
level of advice- Dresdner
would give more details on
Monday.
Deutsche Bank and Com-
merzbank opened direct
banking operations last year
- with Bank 24 and Comdi-
reet respectively. Bayerische
Vereinsbank launched
Advance Bank in March, lay-
ing stress on investment
advice and cash manage-
ment. Citibank of the US
also operates a direct bank
in Germany.
Mr Sarrazin said Dresdner
would push ahead next year
with changes in retail
banking, making greater use
of technology to free staff
for customer advice. He
repeated the bank’s goal
of cutting its cost/income
ratio to well below 7D per
cent
• BHF-Bank was confident
It could survive as an inde-
pendent bank at a time of
speculation about possible
mergers in German banking.
Mr Wolfgang Struts, chair-
man, pai d Allianz, the insur-
ance group, owns around 15
per cent of the bank, but
does not regard this as a
strategic holding. Mr Strutz
said he was sure Allianz
would not sell against the
bank’s wishes.
He was speaking after
announcing a 7 per cent rise
in operating profits, to
DM2 58m. in the first nine
months, with interest
income up 5 per cent at
DM5 68m and commission
income 5 per cent higher at
DM3S3m. ,
Own -account trading prof-
its were flat at DM67tn. Cast
growth was kept at 5 per
cent
Mr Wolfgang Strutz said
medium-sized and specialist
still had an important
role to play in Europe. BHF-
Bank. often mentioned as a
possible takeover candidate,
has been concentrating on
investment banking and
advisory business, and mov-
ing away from corporate
lending.
KNP upbeat on year
despite third-term fall
By Gordon Cramb
in A ms terd a m
KNP BT. the Dutch paper,
packaging and distribution
group, has maintained its
fiiD-year earning* forecast in
spite of 67.2 per cent fall in
third-quarter net profits to
FI 38m ($ 22 .5m).
When reporting interim
net ear ning s of FI 101m this
summer, it said the second
half should be "somewhat
higher" than that. The
company reiterated this
yesterday, noting that the
final three months of the
year were traditionally Us
best.
This will require an after-
tax result in the current
quarter above FI 63m,
compared with the FI 76m
posted in the same period of
1995.
Although that was struck
after a FI 75m extraordinary
charge to cover write-offs on
divestments, it came at a
time when paper prices
remained strong.
KNP, led by chairman Mr
Frank de Wit, said yesterday
"a first increase of paper
prices" was achieved In the
July-Septexnber quarter after
a slide earlier this year left
values for some grades near
historic lows. The shares
closed down FI 0.60 at
FI 37.40.
Five weeks ago the group
said It was seeking an indus-
try partner for KNP Leykam,
its paper division. It said it
was halting new investment
in the unit and implied it
would even consider leaving
the sector.
Yesterday KNP sought to
retreat from that position.
Although it was seeking an
alliance, "we still regard
paper production as a core
activity at this moment", an
official said. Whether this
left it with a minority stake
in the division "could be dis-
cussed".
KNP declined to say
whether it was yet in talks
with any potential partner.
Leykam Incurred an oper-
ating loss of FI 7m in the lat-
est quarter. This compares
with profits of FI 108m a
year earlier, but is a reduc-
tion from the FI 17m operat-
ing deficit in the preceding
quarter. "Although sales vol-
umes were good, margins
were still at a very low
level,” the company said.
Its packaging side pro-
duced operating profits of
FI 57m against FI 39m, with
the Increase attributed to
stable raw material prices,
better volumes, and cost
reductions. But there was a
dip at the distribution divi-
sion. from F16lm to FI 58m.
The 70 per cent-owned BT
Office Products International
contributed less than expec-
ted.
Framatome chief attacks merger plan
By David Owen in Paris
The head of Framatome
yesterday hit out at propos-
als to merge the French
nuclear plant and fuel manu-
facturer with the GEC Als-
thom power engineering and
transport equipment group.
He warned the plans could
pose a threat to the
long-term survival of
France's nuclear network
and its ability to pursue an
independent energy policy.
Mr Jean -Claude Leny told
the economic affairs commis-
sion of the French Senate
that a merger could harm
co-operation with Germany
on the replacement of
Europe’s existing nuclear
power stations.
He also suggested there
were few synergies between
the activities of Framatome
and GEC Alsthom, a joint
venture between Alcatel Als-
thom, the French telecoms
and engineering group, and
the UK’s General Electric
Company. The only possible
synergy was in turbine man-
ufacturing, he said, and this
accounted for only 3 per cent
of the group's activities.
The comments of the
Framatome chairman, who
is expected to stand down at
the end of the year, came
two months after it emerged
that Alcatel and GEC were
discussing the merger,
which would create the
world's second-largest power
engineering group.
But the idea of allowing a
foreign company to take a
stake in France’s nuclear
industry provoked much
criticism. Alcatel, which
owns 44 per cent of
Framatome, recently
reached an agreement with
other shareholders to retain
majority French control of
the world's largest nuclear
plant builder if GEC takes
an interest.
Framatome has completed
more than 60 reactors and
was responsible for the
atomic power programme
which supplies France with
70 per cent of its electricity.
In 1989. Framatome formed a
joint venture with Siemens
of Germany to develop a
reactor - called a European
pressurised water reactor -
for France and Germany,
and for export.
• France’s privatisation
commission is unlikely to
pronounce on the French
government's proposals to
sell the Thomson defence
and consumer electronics
group to Lagardfere until
December or early 1997, Mr
Jean Arthuis, French
finance minister, indicated
yesterday.
The process is expected to
be a formality.
Strong economy lifts Den norske Bank
By Hugh Camegy
in Stockholm
A strong Norwegian
economy helped Den norske
Bank, the country’s biggest
financial services group, to
increase profits in the first
nine months of the year, in
spite of a slowdown in a
recent trend of writing back
provisions made against
loan losses.
Pre-tax operating profits
rose from NKr2.1bn to
NKr2J2bn (S346m) during the
period.
Underlying earnings
growth was stronger, as
operating profits before
write-backs grew from
NKrl.73bn to NKrl.9bn.
The increase was helped
by a near 4 per cent fall in
operating costs, from
NKr3.5bn to NKr3.36bn, as
the bank reduced staff num-
bers by 470 to 5,627. The
shares fell NKrO.30 to close
at NQ21.10.
But Mr Finn Hvistendahl,
chief executive, said perfor-
mance was lifted by strong
growth in the economy, a
rise in lending to Norway’s
important shipping sector,
and benefits from the take-
over early this year of Vital,
the Insurance company. In
the third quarter, operating
profits before write-backs
rose from NKr563m a year
ago to NKr613m.
The rise in lending
demand enabled DnB to sus-
tain net interest income at
almost unchanged levels
despite narrowing margins
between lending and deposit
Interest rates. Net interest
income in the first nine
months fell slightly, from
NKr3.I9bn to NKr3-17bn.
DnB continued to show
gains from write-backs of
provisions made against
loan losses during the loan-
loss crisis of the early 1990s -
but at lower levels. Write-
backs in the first nine
months dropped from
NKr374m to NKr303m.
The bank also benefited
from low tax charges result-
ing from the carry-forward
of previous tax losses sus-
tained during the crisis. DnB
showed ta* charges in thp
first nine months of just
NKrlTm. leaving net profits
up from NKr2.1bn at
NKr2^bn.
• Christiania Bank, Nor-
way’s second-largest bank-
ing group, announced yester-
day that Mr Tom Ruud,
former chief executive of the
industrial group Aker, will
take over as chief executive
of the bank next year.
Mr Ruud will succeed Mr
Borger Lenth. who is to
retire by mid-1997. The new
chief executive parted com-
pany with Aker last month.
Polish
builder
faces
collapse
By Christopher Bobinski
In Warsaw
Espepebe is Poland's first
listed company to face bank-
ruptcy since the revival of
the Warsaw Stock Exchange
five years ago.
Unto yesterday, shares in
the troubled construction
company had fallen 45 per
cent since last week. Yester-
day, bargain banters forced
the stock up 10 per cent.
The company is controlled
by the acquisitive Bank IG.
which took a strategic stake
in Bank Gdansk] when it
was privatised at the end of
last year. Bank Gdansk! and
Bel Leasing, a Bank IG sub-
sidiary, together hold a 22
per cent stake in Espepebe.
The collapse in the share
price, which cut Espepebe' s
market value from 12.4 zlo-
tys ($4.4m) to 6.8m zlotys
followed an admission by
Mr Andrzej Hass, the new
manag in g director, that his
company would go bankrupt
unless creditors agreed to
forgive 80 per cent of 35m
zlotys in debts. Mr Hass also
wants to renegotiate some of
Espepebe’s loss-making con-
tracts.
Nevertheless, the fall in
the stock price, which left
the Szczecin-based builder
with a price to book value
ratio of 0.45, has encouraged
investors to buy into the
company. Around 7 per cent
of its equity changed hands
yesterday and the day
before, when the share price
was at its lowest.
Espepebe, which reported
a 17.8m zlotys net loss last
year, faces a deficit this year
of 30m zlotys, according to
Mr Hass. The company’s
problems stem from an
aggressive marketing policy
which sought contracts at
any price, leaving no room
for profit. This was coupled
with ambitious and misman-
aged plans for housing and
shopping developments
which further affected the
balance sheet.
Espepebe’s situation con-
trasts with the performance
of the WSE’s other listed
construction companies,
which account for 6 per cent
of the market’s $7.7bn capi-
talisation. The sector as a
whole is reporting a price to
book value of 2.02.
US brewer leaves Budvar fighting for identity
Czech group faces marketing challenge after collapse of brand rights talks with Anheuser-Busch
B udejo vicky Budvar.
the Czech brewer, will
have to start forging a
new identity for itself after
the recent breakdown of a
20 -year effort to resolve a
dispute over the Budweiser
name with Anheuser-Busch,
the world's largest brewer.
The US brewer recently
aborted tbe talks, encour-
aged by its growing success
and by court victories giving
it a clear right to the Bud-
weiser name it failed to gain
at the negotiating table. It
has had nine wins in Euro-
pean countries - five in the
past year - and has 27 cases
under way.
With the legal tide run-
ning strongly against it.
Budvar. based in Ceske
Budejovice. the Czech town
known as Budweis in the
Austro-Hungarian era. will
have to stop using the name
Budweiser on its bottles, sev-
eral of its international com-
petitors believe.
“The advantages of an
agreement have fallen
away." said Mr Jack Purnell,
chairman of Anheuser-Busch
international, the US brew-
er’s overseas arm.
“We have achieved undis-
puted access to Europe for
Budweiser and Bud", its two
main brand names. It will
sell about 30m cases,
roughly 2.2m hectolitres of
the beer in Europe this year,
up 25 per cent from last year
and about five times greater
than Bud var’s total exports.
But meeting across a court
room rather around a negoti-
ating table will present both
parties with commercial
risks and costs, fellow brew-
ers believe.
Anheuser-Busch, for exam-
ple, recently pulled out of a
$i45m Vietnamese brewing
joint venture because Bud-
var registered the Budweiser
name there in 1960. The US
company said it was confi-
dent the country’s trade-
mark authorities would can-
cel Budvar’s registration.
For Budvar. global legal
proceedings could damp
investor interest when it is
privatised. The brewer is
almost the only Czech enter-
prise still locked In the arms
of the state.
he privatisation
“doesn’t depend on
[the trademark) dis-
cussion”. says Mr Josef Lux.
Czech agriculture minister.
Anheuser-Busch is not
excluded from the sell-off, he
adds, although it Is unlikely
to be considered while its
threat of court action in
Europe hangs in the air.
Anheuser-Busch was ham-
pered in its efforts to per-
suade Budvar to settle by its
sheer size and by a convic-
tion among Czechs that tbe
giant wanted to "wipe [Bud-
var] off the face of the
earth", as the brewery's gen-
eral director. Mr Jiri Bocek,
claimed recently.
A 1911 agreement signed
with Anheuser-Busch gave
the Czech brewery rights to
the Budweiser name in con-
tinental Europe, with the US
company taking the rest of
the world. Over recent
decades, however, the agree-
ment has failed to accommo-
date the two companies*
aspirations.
Budvar gave increasing
prominence to the name
Budweiser on its labels,
arguing it guaranteed con-
sumers a place of origin and
quality much like France's
appellation amtroltee system.
Anheuser-Busch believed
Budvar was just cashing m
on tbe international brand
name H bad created.
Anheuser-Busch at first
linked, a trademark settle-
ment to its taking a stake in
Budvar. But it became clear
that such an agreement was
unacceptable, both politi-
cally - to the government -
and commercially, to Bud-
var. which insisted it did not
need a foreign partner to
help It market beer overseas.
The US brewery dropped
that tactic two years ago and
at tbe same time began
piecemeal court action in
various countries. The Czech
brewer adopted a more pro-
fessional and hardnosed
approach to the trademark
talks, hiring financial advis-
ers to sketch Its future and
draw up privatisation plans
Last September, both sides
met in St Louis. Missouri
headquarters of Anheuser-
Busch, to try to break the
deadlock. But that attempt
foundered on their differing
estimates of the value of a
settlement The US company
is understood to have offered
Budvar $200m for a new
trademark agreement and a
separate deal on the pur-
chase of Czech hops.
Budvar and the agricul-
ture ministry, which led the
talks on the Czech side, is
believed to have put a value
on the settlement of $ibn.
B udvar also welcomed
the end of the trade-
mark talks, saying it
had shown its ability In the
past five years to build up its
own export sales. It has a
strong position in the Ger-
man market for imported
beers and also sells In tbe
UK. alongside US Budweiser.
“At 450.000 litres of
exports, the Budvar brand is
only worth about £50m
($81 ,5m) and the brewery
itself another £25m-£30m."
says a competing interna-
tional brewer. So success-
fully has Anheuser-Busch
pushed the Budweiser name
globally that “whoever buys
Budvar has got to start
afresh to build a new iden-
tity separate from the Amer-
ican Budweiser".
Vincent Boland
Roderick Oram
■)
(>
\
i
4
21
WNANClALTTMirg
FRIDAY NOVEMBER 1 1996
COMPANIES; Ft IRDpf
european^evv^^ig^t
Strong result at
SPT Telecom
St^rofiTrS^d 68
Comiraratiye figures with the first three quarters of 3995
were^iot available because the company this year adopted
mterational accounting standards, which are different
from the Czech standards it used in earlier years. SPT
aUof S*? 18 * proQts 01 Kc7bn m revenues of Kc26.4bn for
ninths 272.000 new lines were installed, and
sft said it was confident of achieving its 1996 target of
mwe than 400,000 new lines. SPT had 2.67m installed lines
at September 3R It is undertaking a big modernisation
onve to expand its network and spent more than Kc20bn
m the period, more than the full-year investment
programme for 1995. Vincent Boland, Prague
De Benedetti in dealing probe
La wyers for Mr Carlo De Benedetti, former ^afrman of
Olivetti, yesterday confirmed press reports he was unitor
investigation by Turin magistrates for alleged insider
dealing in shares of the troubled Italian information
technology and telecoms group.
l|5r De Benedettl’s lawyers also said he would shortly be
presenting documents to Turin magistrates to refute any
suggestions of insider trading of Olivetti shares. The
investigation is understood to relate to events at the end
of August just before the publication of Olivetti’s
accounts that were to reveal fresh losses of L440bn
($290ru).
In a separate development, Consob, the Italian stock
exchange watchdog; is reported to have requested more
information from Olivetti regarding same of its factoring
activities and the valuation of the sale of a 14.7 per cent
stake in Acorn, the UK-based software company.
Robert Graham. Rome
SSAB hit by lower prices
SSAB, the Swedish steel
maker, posted profits after
financial items for the first
nine months down 44 per
cent from SKrJL8S9bn to
SKrl-603bn (J245m). The
results were slightly below
expectations, but the
shares closed up SKrO.50 at
SKr96. Net profits fell from
SKr2.093bh to SKrl.l37bn
and aamhipi pay shar p
from SKr 15.80 to SKrS.90.
Operating profits dropped
from SKr2.6i8bn to
SKrL297bn on sales down
from SKrl4.08bnto
SKrl3.03bn. SSAB said it
had decided to invest
ABfltfSvarWert GerteraHhcfot
^90‘
v-'r
moiti
mmm
SKr500m in Its Plannja HardTech unit. Of this
investment, SKr440m would be used to build a new
production unit In North America and SKr6Qm to expand .
its existing plants in Luleaa in Sweden. SSAB reiterated
ite previous forej^stthqtfidl year profits would be half of
those repeated m'jL99$. $SAB ^isteef prices bad fallen *
since .the fourth quarter of 1996 and continued to be
pressured, which was expected to lead to additional
deterioration of margins in steel operations In the fourth _
quarter of the year.
But it said there were signs that prices were how
stabilising. The company said it expected fourth quarter
deliveries from the steel operations to remain at .
approximately the same level as a year earlier, while
deliveries from the trading and further processing
operations were expected to be somewhat lower.
Mr Leif Gustafsson. chief executive, said 1996 was
expected to be a tough year for the European steel
industry, with steel consumption forecast to fell about 7 .
per cent and downward price pressures remaining. In the.
third quarter, be said price pressure an the company's
steel products was limited to only 1 per cent compared
with the second quarter, largely owing to an improved
product mix. Prices in the nine-month period were about
12 per cent lower than a year earlier.
He said deliveries from SSAB’s steel operations were
largely unchanged, while volumes in the trading .
operations were around 5 per cent lower t han 1996. Sales
in the nine-month period fell to SKrlSbn from SKrl4bn •
with 8 percentage points of this attributable to lower
prices and 2 points to lower volumes.
AFX News, Stockholm
KPN faces protest over TNT
VKL the association of Dutch courier and express delivery
companies, has lodged a complaint with the European
Commission alleging that KPN, the partially privatised
posts and telecoms group, is using profits from its postal
monopoly to fund its planned FI 2.7bn ($L6bn) takeover of
TNT. the Australian parcels company. Brussels is due to
rule next week on whether the deal, cleared y ester day by
the Australian authorities.' warrants' further scrutiny. -
Mr Harts Koeleman, of Transport en Logistiek
Nederland, an industry grouping of which the 300-member
VKI is part, said yesterday: “The takeover wil l
intermingle' its monopoly and non-monopoly activities -It
will be too strong a competitor in the Dutch market. The
association wants an end to KPNs sole right to deliver
letters weighing less than 600 grammes - an idea to
which KPN has said it is not opposed, as long as such
deregulation happens EU-wide. PTT Post, itsnmfl arm
which also includes private sector parcel activities.
brought in net earnings last year of Fi 541m. ^ ' .
Gordon Cramb. Amsterdam
Spain urged to open telecoms
Theboard of the Unisource telecommunications alliance
yesterday appealed to the Spanish government to open .up
ite telecommunications market as soon as ttmt
it could receive European Union aPP^ 0 ^ Spanish
telecommunications market is not
ijnisource operation won't be approved, Mr Lars Berg,
^airman of the European group, said.
Commission has said it will only approve foe
ihiance if Spain opens up its telecoms market by January
■ S™ iS£3E«£ * the Netheriands, Telia
^SSSSS^SL Telecom Teleffiniaa. tte ^
etoup. has 25 per cent of the allian ce. Once rt is
panish: company s s -The non-integration
ent on the share price of Telefonica. Reuteri Madrid
consents cmd pres,
companies coverage C ^J*J****J V email to
Coming soon to the Swiss Exchange: SEZ
An
investment in
outstanding
growth
Ope ra ting Income
mcwrifloo
In mid-November the roistered shares of SEZ Holding AG, Zurich, will be floated
under the lead of Bank J.VfontobeJ & Co AG and listed on the Swiss Exchange.
Sustained growth
In a very shore time SEZ has developed Into a world-class supplier to the micro-
chip industry. The company’s expansion is outpacing that of the international
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ture market leadership worldwide in wet etching.
Profit growing forcer
chan sales: earning* up
20- fold in live years.
1 986: founded by Egon Pucti and Franz Sumnhxch,tha current
CEOs, to develop an innovative wet etching process for die semi-
conductor industry.
1 996: Operational headquarters inViUaeh (Austria), with
subsidiaries in the UK and USA. a joint venture In japan and strategic
affiances in Taiwan, Korea and Singapore.
Sales: CHF 43.1 million; net Income: CHF 6.8 million; equity ratio
after IPO: over 80%.
1 997: Quantum leap in growth: sales up 60%. net income up 95%.
To obcain full information, order the SEZ company portrait from:
SEZ AG. Monika Kralcer, Draubodenweg 29. 9500 VlUach. Austria.
Phone +43 4242 204, or
Bank J.Vontobel & Co AG. Karin Orel. Bahnhofotrssse 3,
8022 Zurich, Switzerland, Phone +41 I 283 71 60
}
HOBART COMMUNICATIONS
FINANCIAL ADVERTISING
AND MARKETING
LITERATURE DESIGN
♦
ACRYLICS/LUCITES/TOMBSTO N E S
FOR FURTHER INFORMATION PLEASE CONTACT
STEPHEN WITT. MARKETING DIRECTOR
Postal iddnai:
PO BOX 212 WEST MAILING KENT ME19 5SB ENGLAND
E-mail addresa:
iofo0hobarc.co.uk
World wide web:
hit p;//www. ho bart. eo.uk
Facsimile:
01732 842266
Telephone:
01732 841100
ISDN:
0 1732 872371
COMMERCIAL PROPERTY
LEGAL NOTICES
IN THE SUPREME COURT OF BERMUDA CIVIL JURISDICTION
1983: NO. 29
3N THE MATTER OF THE COMPANIES (WINDING-UP) ACT 1977 AND
. IN THE MATTER OF THE INSURANCE ACT 1981 A ND
IN THE MATTER OF DOVER INSURANCE COMPANY UMHED-IN LIQUIDATION
NOTICE TO CREDITORS OF INTENTION TO DECLARE DIVIDEND
TO: AN person* who (a) ep p ua r from the records of the company to have contractual ra i a fin na h i p
with the company AND (b) ham not Seda proof of debt In th* NquMation of the company
TAKE nolle* that a s econd Int e r im dividend la intended to be declared In this matter. The dividend is
Htety to be 20
The Liquidator has previously notified you of the claims fling daadTne astobfehed as Marsh 31, 1991 and
no claim was (Had by you.. Consequently, the Liquidator may p ro c e ed to dUrflxd* the dhddend only to
those cradftors who have lodged preofe of debt wthin tha fling daadSna, uniasa (a) you lodge a proof of
debt within 14 days at this nodes and (b) you show just causa why the proposed dividend should not be
dactaad and paid i
Dated this 1st day of Nove m b er , 1996
NicoMto J. Rene.
ferandonbahaVcf
Chart** W. Kacnpa, Jr.
Liquidator
INTERNATIONAL TENDER FOR THE SALE OF
HOTEL REGENCY
MONASTIR - TUNISIA
La Compagnie Touristique Arabe “C.TJL” is
putting on sale the REGENCY HOTEL 5***** -
400 beds - situated in Cap Marina Monlstir -
. Tunisia. .,
Interested parties may obtain the relevant files
from the Head Office of C.TA. at 12, Rue de
Hollande -1000 TUNIS -Tel: (216.1) 350.695-
Fax: (216.1) 342.407
a) The outer envelope should bear the mention
“DO NOT OPEN” - International tender for the
sale of Hotel REGENCY - Monistir, and should
be addressed to:
Mr. le President Directeur G6n6ral de la
Compagnie Touristique Arabe
12, rue de Hollande - 1000 TUNIS - TUNISIA
b) The inner envelope should be sealed and
should contain the documents relevant to the
International tender mentioned in the
specifications.
The final date for the receipt for the tenders
has been set for January the 20th 1997.
(The seal for the C.T.A. Bureau d’Ordre or the
Post Office seal is proof of date).
Ajlicante/Spain
10 km from town centre.
30 km from Benidortn
400.000 m*
building-, industrial
or agricultural land.
Country house 600 m*
(needs repair)
Best climate in Spain!
For sale 775 piasVm 1
TeL ++49 72 43 - 30 650
Fax 30 655 (Germany)
FRANCE
Wc apcrialuc in mi riming
commercial property a Frame, sod
ad ac behalf oT major hueroaboral
banks, insurance companies,
iuvcsxas and developers- Though
our pro-acrive and atntegic
marketing methods, we have
achieved significant result* for our
clients.
If you arc having difficulties in
letting or aeffing your c omm erc i al
property in France you should speak
touafhaL
FJKL mvESmSSHMENTS
72 . for to Fkztourg,
Sj HononS 7SOOS Para.
W; 1 1 > 40 07 U D7 . Fta: 1 1> 40 07 16
Birmingham, Edgbaston
Bhmm&iant City Cenhr Vi miles; A38fW) 2 mite, London 123 mite |Dfannret approx)
An I m p r ess i ve grade II listed Victorian building with potential.
Providing approximately 1,421.93m 2 f 15306 sq ft) (Gross
Internal) accommodation currently with open B1 office use
Ground floor tndwflng reception haQ, boardroom, orangery and ballroom.
7 first floor rooms. 8 second floor rooms. Garaging outpoUdlngs and flat.
Mature gardens with secondary access off Anoxuther Road.
About 1.8 acres (0.73 ha)
5 Union Stmt SoaifoitmpoiVAvon. Warwickshire CV37 6QT. Tel: 01789-297735
1 S2S)oanc Street. London SWIX 9D8.Trfc 0171 -£Z4 B171
Commercial Property
CRAWFORD
PLACE
LONDON, W1
AIR-CONDITIONED
OFFICE
BUILDING
11,325 SQ.FT
APPROX
FOR SALE
FREEHOLD
Jama* Lewis & Company
9171431 4565
I — r l ltoi a . a»eeadBaStrea
Loodoa W 1 P 1 FG
taBflMtt«27
Every Friday
To re ach 52/100 property decision makers advertise hi the Bnanctei
Timas' Commercial Property section every Friday.
For farther I nfo r matio n
Cont a ct
Emma Mrfafy on 0171 873 4901
Commercial Property forthcoming features
scheduled for NOVEMBER 1996 Include:
22 November Warehousing and distribution
UK Commercisi Property
LUXURY FULLY
FURNISHED OFFICES
ST JOHNS WOOD
& SWISS COTTAGE
Total support services. 24 hr access.
Two months minimum from £100 pw.
Tel: 0171 483 2281
The Financial Times plans to publish a Survey on
Investment &
Finance in Turkey
on Thursday, November 21
For further Information on advertising please contact:
Klrsty Saunders in London on
Tel: 0171 873 4823 Fax: 0171 873 3204
or
Giro Constante In Istanbul on
Tel: +90 212 279 26 48
Fax: +90 222 264 17 61
FT Surveys
■ - om'
-? -
22
FINANCIAL TUMES
FRIDAY NOVEMBER l 1996
COMPANIES AND FINANCE: THE AMERICAS
Caracas sets CANTY reference price
By Raymond Coiitt
in Caracas
The Venezuelan government
yesterday announced the ref-
erence price for the sale of
its 49 per cent stake in
CANTV, the telecommunica-
tions company.
The price range has been
set at $3,071 to $3.50 per
share, or $21.50 to S2-L50 per
American Depositary
Receipt. The sale, due on
November 27, will raise up to
Si . 01 bn and will be the coun-
try's largest initial public
offering.
un & Bradstreet,
today does the
splits. The 155-year-
old information conglomer-
ate is dividing into three.
Two publicly listed compa-
nies - Cognizant and AC
Nielsen - are being created
through a tax-free special
dividend and start trading
today. The rump of Dun &
Bradstreet - Moody’s and
other credit services - con-
tinues as a separate entity.
The aim of the split, says
Mr Bob Weissman, the
youthful 56-year-old former
chairman of D&B and new
chief executive of Cognizant,
is to enhance shareholder
value by allowing the com-
panies to preserve good
strategies and make better
decisions.
Managing the old D&B
became increasingly difficult
because it was so diverse, he
explains. The company
included mature but highly
lucrative businesses such as
Yellow Pages and Moody’s,
the ratings service; AC Niel-
sen. the barely profitable
information group supplying
data for the fast-moving con-
sumer goods industry; and
rapidly -growing operations
such as IMS, the healthcare
information group. Nielsen
Media Research, the televi-
sion audience measurement
service, and Gartner, the
quoted information technol-
ogy consultancy.
“Look, the businesses had
very different positions and
needs,” says Mr Weissman.
"Frankly, there were a lot of
tensions. Take AC Nielsen
and IMS - they shouldn’t
have been on the same
planet, let alone in the same
organisation."
Mr Weissman explains
that AC Nielsen was in a
highly competitive environ-
ment. The right strategic
move was to invest heavily
in new services. But D&B’s
dividend was absorbing 70
per cent of free cash flow.
A total of 289.4m shares
will be offered, of which 50m
are to be placed on the Ven-
ezuelan market. In addition
to the 40 per cent share
package being sold globally.
CANTV employees are being
offered a 9 per cent stake.
The government insists
that the CANTV offering
does not conflict with the
placing of other shares. “We
see a window of opportunity
that favours the placement,
as there are no similar offer-
ings by developing coun-
tries," said Mr Alberto
Poletto. head of Venezuela's
making that investment dif-
ficult to fund.
In contrast, IMS wanted to
expand through acquisitions.
But the shortage of cash
held back its ambitions, and
the high dividend made
using stock issues expensive.
An effective acquisition pol-
icy was impossible.
The split has meant a cut
in dividend, concedes Mr
Weissman. Cognizant, which
includes IMS, Gartner and
Nielsen Media Research, will
have a pay-out ratio of 8 per
cent; AC Nielsen will not
have a dividend; and the
D&B rump - essentially
Moody's - will have a pay-
out ratio of 48 per cent Mer-
rill Lynch, the US broker,
estimates the combined
quarterly dividends of the
three groups will be only 25
cents, against 66 cents
before.
“The decision was made
easier because the rationale
for the old company had
come to an end.” says Mr
Weissman. “Say, 15 years
ago. there were economies of
scope and scale because
most of the divisions were In
the business of processing
large volumes of data. That
meant they needed huge
investments in information
and communications tech-
nology.
"But the cost of computing
has fallen so much that the
paradigm for competition is
no longer scope and scale,
but speed. Size is no longer
an advantage - in fact it can
be a liability.”
Mr Weissman has chosen
to manage fast-growing Cog-
nizant. IMS. Gartner and
Nielsen Media Research are
diverse businesses, but he
insists this is no problem.
“It's misleading to think in
terms of the end-market The
important synergies are in
value-added costs. All three
need significant technologi-
cal expertise, database man-
agement and communica-
privatisation agency, Fando
de Inversiones de Venezuela.
Industry analysts say that
growth prospects for the
telecommunications indus-
try In Venezuela are favour-
able. with a rapid economic
recovery expected. However,
they say that CANTY'S sale
price could be affected by
the fact that its monopoly
ends in the year 2000 .
According to Mr Poletto.
this is the “first time that
international investors are
analysing stocks placed by
the Venezuelan govern-
ment.” He added that “this
(ions technology. There are a
lot of shared competencies."
Mr Weissman and his
team, which will be remu-
nerated mainly by the
group's share performance,
are ambitious for Cognizant
which has achieved a com-
pound annual operating
profit growth rate of 15 per
cent for the past five years.
Not least it wants to grow
through acquisition. “The
investment bankers are tell-
ing us we could fund Slbn of
acquisitions without diffi-
culty - and that's just cash.
We could use stock as well"
In the mid-term most
acquisitions will be in
healthcare, says Mr Weiss-
man. The aim is to expand
IMS, which will account for
about 60 per cent of Cogni-
zant's sales, geographically.
IMS will also expand its
customer base. Historically,
privatisation is a measure of
the country's credibility”.
The Venworld Telecommu-
nications consortium - made
up of GTE, AT&T. Telefdnica
de Espana. Venezuela's
Banco Mercantil and
Electricldad de Caracas -
currently holds a 40 per cent
shar e in CANTV.
A road show by CANTV
and Fiv officials, scheduled
to be launched today In
Venezuela and Monday in
Europe, precedes the open-
ing of a three-week book-
building process to conclude
on November 21 with the pri-
the group has supplied data
mainly to marketing and
sales sections of pharmaceu-
tical companies, says Mr
Rene Derecque. president of
IMS International. He aims
to target research and devel-
opment departments and
regulatory affairs sections.
"Everyone is looking to
control healthcare costs,"
says Mr Weissman. “The
lubricant of efficiency Is
information and there is an
explosion in demand for
such data. Nobody domi-
nates that, but we're in a
good position to do so.”
M r Weissman dis-
misses suggestions
that health main-
tenance organisations,
which increasingly control
healthcare budgets, threaten
to squeeze its US business.
As for the other busi-
cing and placing of the
shares on November 27. The
two global lead managers of
the offering are investment
banks Lehman Brothers and
SBC Warburg.
The CANTV IPO marks
the revival of Venezuela’s
stalled privatisation process,
which lacked political sup-
port and had run into
bureaucratic problems dur-
ing the first two years of the
current administration. Mr
Poletto said that the govern-
ment now expected to raise
some $4-5bn over the next
five to six months.
nesses. Nielsen Media
Research has huge opportu-
nities in monitoring the
Internet. And he intends
Gartner to achieve Slbn
sales by the end of the
decade. “That’s explosive. In
1990, it had revenues of just
S60m," he says.
So far, the markets seem
dubious about the plan, not
least because of the dividend
cut. Despite well-received
road-shows, the shares have
fallen from $63.13 since Jan-
uary 8, before the break-up
was announced, to $57%.
Over the same period the
shares bave underperformed
the S&P composite index by
20 per cent. Mr Weissman’s
strategy may prove sound,
but he has his work cut out
to convince the markets of
its validity.
Paul Abrahams
CVRD
net profits
advance
by 34%
CVRD, the Br azilian mining
group preparing for privati-
sation in one of the biggest
offerings In Latin America,
announced a 34 per cent rise
in net profit in the nine
months to September 30, to
RS280m (US$27 2m) com-
pared with B$209m In the
same period in 1995, agen-
cies report from Rio de
Janeiro. Earnings per share
were RS0.72 against RS0.54
in the comparable period.
The results were broadly
in line with analysts’ expec-
tations.
Nine-month net revenue
was up 1.5 per cent com-
pared with the same period
in 1995, which the company
attributed to a continued
recovery in steel prices.
CVRD said the revenue
increase came in spite of a
3.6 per cent drop in the vol-
ume of iron ore sold to for-
eign markets, which account
for 70 per cent of the compa-
ny's sales.
The lower iron ore sales to
foreign markets were tied to
lower European demand,
according to Mr Anastacio
Fernandes, company direc-
tor. Total iron ore sales
dropped about 3 per cent.
Gross revenue from gold
was up 0.8 per cent to
R$153-2m.
Revenues from CVRD’s
railway and port services
were stable at about
R$437m. Railway revenues
declined 1.9 per cent, while
port revenues increased 6.3
per cent.
CVRD said its tax bill
dropped 16.4 per cent to
R$103m, largely due to the
suspension of the val-
ue-added tax (I CMS) charged
on its North System iron ore
exports and South System
pellets exports. The I CMS
exemption saved the com-
pany R$24m.
The cost of products and
services bought by the com-
pany declined 7 per cent,
partly reflecting productiv-
ity gains derived from staff
reductions.
CVRD's privatisation is
expected to raise about
US$6bn. The government
hopes to auction 40 to 45 per
cent of the company's voting
shares in February 19J97
before selling further shares
to investors via a global
offering.
This will be followed by
an offer to employees of 10
per cent of the company's
total capital (including 5.1
per cent of ordinary shares).
A further 17 to 20 per cent
of ordinary shares will be
sold on Brazilian and over-
seas capital markets, proba-
bly by June 1997.
Dun & Bradstreet opts for divorce
Break-up is seen as the best way to cater for the diverse needs of the business
Cognizant declares independence
Revenue ($m)
BOO
Brewers try to solve dispute
Monsanto reaps benefit
of genetic engineering
US group prepares for new ‘green revolution 5
By Robert Gibbens
in Montreal
Molson Breweries, the
Canadian brewer, will con-
tinue producing Coors beer
agreement with Molson
Breweries, which allowed
Molson Breweries to produce
Coors brands in Canada.
Molson Breweries is
owned 40 per cent bv Molson
ticipate in any decisions
relating to Coors.
On October 18, a Canadian
arbitration panel ruled that
Molson Breweries did break
the licencine agreement It
W hen US soyabean
farmers complete
their near-record
harvest this autumn, they
will be reaping the benefits
of change at Monsanto, the
St Louis-based chemical and
pharmaceutical company.
With this year's harvest,
Monsanto will realise the
first commercial fruits of a
$lbn, 15-year research effort
to enhance common plants
through genetic engineering.
Its transgenic soyabean,
which was altered by insert-
ing DNA from a common
soil micro-organism into its
genetic structure, resists
Monsanto's own brand-name
herbicide, and was available
to fanners on a limited basis
this year.
Although official results
are not yet in. first reports
are that the transgenic seed
yielded 20 per cent more
than its conventional neigh-
bours and required fewer
applications of chemicals -
more than compensating
growers for its premium
price.
The “rewired” seed is
expected to give new legs to
Round-Up, the 25-year-old
herbicide that accounts for
more than half of Monsan-
to’s total operating income.
The “Round-Up Ready” soya-
bean Is also one of Monsan-
to’s earliest entries in the
race to control and commer-
cialise the science that some
believe will form the basis of
a new “green revolution”.
Monsanto executives pre-
dict that genetically-altered
seed will become a $6bn
annual market within five
years, as the world seeks
ways to meet rising food
demand while dealing with
environmental concerns and
the gradual exit of govern-
ments from agriculture.
Mr Robert Sbapiro, Mon-
santo chairman, is prepared
to bet the farm on the new
technology. Last month he
announced Monsanto's plans
to spin-off or sell its profit-
able specialty chemicals
business. The divestiture,
due to take place within the
next few months, will leave
Monsanto in three busi-
nesses, with agricultural
products by Ear the largest.
The others are food ingredi-
ents (where the lead product
is the Nutrasweet sweetener)
and Seaxle, the Chicago-
based drug company.
Analysts say selling or
spinning off the chemical
unit will not bring new cash
to the company, but will
leave Monsanto with less
debt, and with a high-growth
business that requires very
little capital investment. Mr
James Wilbur, analyst with
Smith Barney in New York,
said over the longer term, it
would not be surprising if
Monsanto considered divest-
ing either Its drug or food
ingredients units as well.
Chemicals accounted for
40 per cent of Monsanto's
$7bn revenues in the first
nine months of this year, but
generated Just 20 per cent of
its $lJ2bn operating income
in the same period. Agricul-
tural products, in contrast,
generated $73 lm in operat-
ing income from January to
September, a 25 per cent rise
from a year earlier.
Shareholders are enthusi-
astically buying into Mon-
santo's new “life sciences"
image, although profits from
the bio-tech business have
barely begun to trickle in.
Monsanto's share price has
behaved more like an Inter-
net start-up than a chemical
company, rising from $18
two years ago to more than
$41 this month (adjusted for
a five-for-one stock split).
As in any high-tech indus-
try, Monsanto’s success in
plant engineering depends
on Its ability to control pro-
prietary technology all the
way down the product
stream and to get it into the
fields at a premium price.
Gaining regulatory and
consumer approval for the
products outside the US -
where there is the largest
potential for transgenic seed
- is central to their success.
The company is learning
this year that these approv-
als can be time-consuming
and costly to obtain.
At home. Monsanto has
invested nearly $750m in the
past 12 months to purchase
or partner seed companies
that will distribute the new
genetic “software” to farm-
ers. It now owns the world's
second-largest soyabean seed
company. As grow; has a
majority Interest in Calgene,
the California company that
has leading transgenic
patents for tomatoes and for
higher-oil content oilseeds;
and has a substantial Inter-
est in DeKalb. the second-
largest maize seed company
in the world.
While analysts agree Mon-
santo has the dominant posi-
tion in the plant gene-trans-
fer business, it is just one in
a gathering of global giants.
Its competitors include
Novartis, (the result of the
merger between Ciba-Geigy
and Sandoz); AgrEvo, a con-
sortium formed by Hoechst.'
Roussel Uclaf and Schering.
and Dow Elanco, a Joint ven-
ture between Dow Chemical
and Eli Lilly.
Mr Sana Shimoda. analyst
with BioSciences Securities
says: "What we will soon
have is an agricultural-
industrial complex based on
strategic relationships
between these firms.” which
will cover seed and chemi-
cals distribution and even
processing of transgenic
crops.
Laurie Morse
in Canada until June 30 1997.
while the two companies try
to solve a long-term licenc-
ing dispute.
The dispute centres on the
1993 acquisition of 20 per
cent of Molson Breweries by
Miller or the US. a competi-
tor of Coors. Coors com-
plained it was not consulted,
and Miller's purchase broke
the terms of Coors' licencing
Companies, a holding com-
pany, and 40 per cent by Fos-
ter's of Australia.
Coors feared that its suc-
cess in Canada would be
restricted by Miller's place
on Molson Breweries' board,
which would give Miller
access to Cooes' marketing
strategy. Molson Breweries
denied Miller exercised con-
trol. and said it did not par-
ended the agreement as of
April 1993. requiring Molson
Breweries to face paying
Coors its share of profits
over 3* * years.
Molson said its earnings
would be reduced by C$15m
tUSSlltn) for the October
1996 to June 1997 period.
Both companies will con-
tinue talks to set up longer
term arrangements.
Thi% -uh emr-emc-ru fa isvucd in «xniipluince with the requirement.-, of I he L.-ndon Meek Exchange Limited nhe
"L -xuk-n Sl.x-k Exclunjsc' It doe* nw conMiiuie in offer or form pan of Jnv offer or invitation 10 seU <x issue, or
mv solicivman of" an offer lo purchase or nub'erlfae for. im oniirurv bh.nrrr in The Brtn AJlctc-ft Company pic
i "The IVIll vilcroft Coropuny"\
Im been made to the London Stcvk Exchange for the whole of the ordinary share capital of The BntJ
dlcmfi Ci-mpanv. issued and to he Lv-ued. to tv admitted to the Official List of the London Stack Exchange. It is
expected lhai .idnU-mon io the Official Lot will Ixvontc effective and' that dolmas in the ordinary dures will
commence on t> November T^od.
The Britt Allcroft Company pic
I lmt»ponled and rc^i’tcnrd nt England and miles under the Companies .\et Regfaleted No 21201.2-1 l
Placing
Sponsored by Price Waterhouse Corporate Finance
and
Underwritten by Charterhouse Tilney Securities limite d
of
8,525,693 ordinary shares of 10 pence each at 130 pence
per ordinary share
Authorised
Number Amount
J4.000.IKM £}.-WU.LW
Share capital foOowtaji die p hring
ordinary shuts, of in pvrKtr each
IsMied and full)' paid
Number Amount
i}, 505.10-5 ^.350.510
The principal activities of The Brio AlUrroft Company arc the creation or acquisition, production and licensing of
entertainment charterers for a worldwide family audience.
A document rotating IO The Brut A iicroft Company, comprising; a pn>Kpecta-i and listing particular! as barest has
been published and will be available, for coNcfJon dunns normal bipinw* hours, tor mo business days From the
dale hereof from the Company Announcements Office. London 5u.vk Exchange. London Stock Exchange Tow er.
Old Bread Mreet entrance. London EC2N 1HR and during normal business hours on anv weekday - Saturday.
Sundays and public holidays cftcvpicd) from die due hereof up to and including 15 November from.-
The Bnn Aileron Company pic Charterhouse Tilney Securities S.F Uerwin X Co
4 OnNnVy Square Limned 222 tTrays Inn Rood
Soui lump !, hi SOS'S 2 [IE 1 Paiemo»er Row London WC1X SHB
St. Paul 1 *
Lomkn EC-LV "DH
I November 1996
AMERICAS NEWS DIGEST
Data General
ahead of forecasts
computer manufacturer, which has been struggling for
several years, attributed its results to a successful
transition to new products.
Net income for the fourth quarter, ended September -S,
was $9 .9m. or 24 cents a share. Wall Street analysts had
been expecting earnings of about 19 cents a share- In the
same period last year, the company reported net income
of $1.5m, or 4 cents. Revenues for the quarter were
5336.2m. up 7 per cent from $312. 8m in the same period
last year.
Data General's new computer systems, based ou Intel
microprocessor chips, now represent more than 40per
cent of server sales, the company said. Revenues from
storage systems also grew during the quarter.
For the year. Data General reported net income of
* 28 . Im, or 68 cents a share, against a net loss of $46.7m .
or $1.23, in fiscal 1995. The 1995 results included a
restructuring charge of $43m as well as a pre-tax gain of
$44,5m from the settlement of litigation. Revenues for
fi ffrqii 1996 grew 14 per cent to $1.32bn. up from $1.6bn m
fiscal 1995.
The year-results represent “a dramatic turnround for
Data General" said Mr Ronald Skates, president and chief
executive. Data General's shares were trading at $14*. in
mid-session yesterday, unchanged from Wednesday's
dose. Louise Kehoe. Son Francisco
Horsham and Trizec to merge
Horsham and Trizec, two companies controlled by
Canadian financier Mr Peter Munk. received shareholder
approval yesterday to merge into Trizec Haan. North
America's second-biggest quoted property group with
US$6bn assets.
mi- M onk took control of Trizec, formerly owned by the
Bronfman family of Toronto, in a big financial
restructuring in July 1994 as the North American
property slump ended. He also controls Bamck, the big
international gold producer, partly through Horsham.
The new Trizec Haan will be an international property
group with a portfolio worth more than US$3.5bn
including 50m square feet or commercial and office space
in North America- principally the US, and a strong
European base.
Trizec Haan stock will be traded on the New York.
Toronto and Montreal stock exchanges. Horsham posted
third quarter earnings of US$53m, or 49 cents a share,
against US$14.im. or 14 cents, a year earlier. Including
special items, the latest quarter showed a loss of US$3 -2m.
Trizec. hitherto 48 per cent held by Horsham, posted
third-quarter earnings of US$LL3m, or 11 cents, against
US$11. 3m. or 10 cents, on revenues of US$148m against
US$135 m. Robert Gibbens . Montreal
Dofasco may raise dividend
Dofasco. Canada's biggest steelmaker, is considering
raising Its dividend or buying back shares following a
strong profit performance this year. ""
The comapny, which specialises in flat rolled products
for the car industry, earned C$50. 1 m (US$37m). or 58 cents
a share, in the third quarter, up 10 per cent from C$45. 3m.
or 52 cents, a year earlier. Nine-months profit was
C$1 27.8m, or C$1.49, against C$12A2m. or C$1.45. a year
earlier. Revenues were C$2.2bn against C$2 bn.
Robert Gibbens
Western Star hit by downturn
The cyclical downturn in North American heavy truck
demand hit Western Star, the Canadian-based producer
which owns ERF of the UK. in the first quarter of fiscal
1997. Net profit for the three months ended September 30
was C$7. lm (US$5 -2m). or 56 cents a share, down from
C$12-3m. or C$1.10, a year earlier, on revenues of C$281m
against C$175m.
The quarter included extra cost for developing its new
line of heavy trucks made in British Columbia. Lower
demand had led to aggressive pricing and lower margins
throughout the industry, said Mr Drew Fitch, executive
vice-president Robert Gibbens
Mitel advances to C$16.5m
Mitel, the Canadian telecommunications equipment
group, exceeded market forecasts with net profit of
C$16.5m (US$12. 3m) or 15 cents a share in the second
quarter ended September 27. up from C$15m or 13 cents a
share a year earlier. Revenues were C$169m against
C$149m_
Mitel, a PBX and semiconductor producer, has set
record sales over the past two quarters partly due to
buying a Swedish semiconductor plant last March. It is
now moving aggressively into computer-telephone
integration products. Robert Gibbens
BENETTON
GROUP S.pA
a company with ragratared office In Ponzano Venelo (TV), Italy
Via Villa Minett. 1: a stock capital of Ut 87276.862500- registered at
No. 4424 of the Treviso Company Register.
Half-Year Report
January-June 1 996
Notice is hereby given that Benetton Group S.pA Is
Half-Year Report on the Company and Group
performance as of June 30, 1996 may be obtained
on request from:
-the Company or
the Stock Exchange Council in Milan.
SUMO LAND COMPANY LIMITED
fa company incorporated in Hong Kong with limited liability)
US$200,000,000 5% Convertible Bonds due 2000
(The “Bonds”)
NOTICE TO BONDHOLDERS
s,no Lend Company Limfrad (“the Company'! on
1 October, 1996 proposed a final dividend of HKS0.12 per share (with
an option for scrip dividend) for the year ended 30 June. 1996 to
“» register o{ members on 22
November. 1996. This final dividend rs payable on 20 December. 1996.
* S approval of shareholders of the
^p^ at lhe /Uini'al General Meeting to be held on 22 November,
cSmb^, warranus wi " despatched on or about 20
7 te £)k? 1 ' 9 of * h ® Company wilt be closed from 18
November. 1996 to 22 November, 19% (both dates Inclusive).
°T rt !u 0 . B 2 rKfe » exercise their con-
mHh •S BC Sf? their Bond s so as to be entitled to the said
S2? P '°P* H V completed and signed can-
W,t £ ‘i 18 6006 certificates with their Agent so
NtaXr S Pany bef ° re 4 00 P- m IHon fl Kfcnfl «"Wl 0" 22
By Order of the Board
Eric Ip Sai Kwong
Secretary
Hong Kong
1 November, 1996
BttQribartLNA ICciporara Aflancy & Trust). Aawr Bank CITlBANOGl
\
\
S*
/IX in
iiv i!i\iiiviiil
il In liiH'SE
FTNANCIAL. TT vrrg
FRIDAY NOVEMBER 1 1996
COMPANIES AND FINANCE: UK
Shell disappoints in third quarter
®y J*ne Martinson
A« y ? butch/Shell, the
Anglo-Dutch oil group,
tillrd Quarter earn-
ings below market expecta-
lIO ° s yesterday, after
restructuring charges and
exploration write-offs.
Net profits fell to £L12bn
(SLfi2bzO, against fiuaobn, in
the three months to Septem-
ber 30, on a replacement cost
basis and excluding excep-
tional Items. This was
despite oil prices reaching
them highest level since the
Gulf war.
The shares fell I5p to
£10.05Vip after a strong run
in recent months.
Mr John Toalster, sector
analyst at Sociftt§ G&n&rale
Strauss Turnbull, said:
"These figures are somewhat
disappointing given the
strength of oil prices in the
quarter."
Analysts had expected
continuing difficulties in
Shell's chemicals trading
arm and squeezed marine
in its refineries businesses.
However, there was some
surprise ova: the cost of up
to $50m (£Slm) for restruct-
uring in Malaysia, where
there bad been 600 redun-
dancies. Shell also wrote off
exploration costs of £222m,
some 54 per cent higfrw than
last time.
Analysts' forecasts for 1096
profits range from £5-2bn to
£5JJbxL
Exploration and produc-
tion earnings provided the
biggest fillip in the quarter.
with a 74 per cent rise to
£599 kei. This was mainly due
to higher oil prices, hut was
helped by increased oil pro-
duction, gas sales outside
the US and lower costs. In
the US, exploration and pro-
duction earnings more than
doubled to £i55m-
Oil prices averaged $2090
a barrel in the period, up 23
per cent on the year. Shell
expected them to continue to
be volatile, although they
had been “robust" in the
fourth quarter.
Cash flow of £l-98bn from
operating activities was
£500m lower than last time.
However, Mr Henry Strict,
head of Investor relations,
said this was due to a
change in the accounting
treatment of short-term debt.
The group had net cash at
the period end. a position
which Mr S trick said was
“not part of the declared pol-
icy" of the group. One ana-
lyst said this indicated scope
for a big dividend increase.
See Lex
Grack in glass
prices knocks
Pilkington
By Ross Tieman
A Europe- wide slump in
prices for building glass
knocked first-half pre-tax
profits at Piltebogton down 28
per cent to £75m ($i22^tm).
The slide came despite a
strong performance in the
US, especially on the auto-
motive side, and notwith-
standing some £85m of bene-
fits from an aggressive
cost-cutting drive launched
last year.
Reinforced by an
unchanged dividend of l.TCp.
the shares closed at 17ip, up
lVip.
Sir Nigel Rudd, the chair-
man, said: “We would expect
to see an impoving trend in
the second half of the year.”
Like its chief rivals world-
wide, Guardian of the US
and St Go bain of France,
Pilkington has been battling
against a combination of fall-
ing prices and insufficient
capacity utilisation in
Europe since the beginning
of 1995-
Prices of commodity build-
ing glass in this market,
have fallen 25 per cent.
- Price weakness in Europe
is being compounded by the
loss of traditional export
markets in the Middle East
and Asia as capacity there
comes on stream.
As a result, operating prof-
its from its European build-
ing products businesses fell
40 per cent to £42m in the six
months to September 30.
FarpusViHUi
Nigel Rudd, right, with Roger Leverton - expecting an improving trend in the second half
Mr Roger Leverton, chief
executive, said that since
June, Pilkington had been
able to increase its selling
prices from DM4J5 to DM&5
per sq m. But capacity utilis-
ation In its European plants
is running below 90 per cent.
The company is seeking to
accelerate the resfructuring
of the business, Mr Leverton
said. It also plans to export
50,000 tonnes of glass, about
a third of the annual produc-
tion of one of its float plants,
from Europe to the US dur-
ing the second half to help
meet strong demand there.
■ The US business achieved
operating profit of £36m
(£28m) during the first half
on sales of £393m. The fig-
ures include a strong perfor-
mance by the US automotive
business, which is benefiting
from earlier cost-cutting
measures.
T&N steps up asbestos cover search
By Tim Burt
T&N. the engineering group
and former asbestos pro-
ducer, has stepped up the
search for possible insurance
cover against its asbestos
liabilities.
The company, which as
Turner & Newall was one of
the UK's largest asbestos
companies, has appointed
specialist brokers to explore
ways of capping its exposure
to compensation claims -
mainly fropa the US.
. The move coincides with a
preliminary hearing in the
US Supreme Court today on
the “Georgine Settlement", a
class action, setting fixed
payments for sufferers of
asbestos-related Rj enastm
T&N has warned it would
have to donble this year’s
asbestos provision to about
£10Gm If the Supreme Court
upheld an earlier ruling that
the settlement did not con-
stitute a class action.
If the court decided to
review the case, the fixed
payment system would
remain in place until formal
hearings begin next year.
But if the case is thrown
out. T&N would face a big
rise in personal injury
Harms in the US. A decision
is expected early next week.
Zn the meantime, T&N has
formally asked brokers -
thought by some analysts to
be Sedgwick — to draw up
insurance proposals to
reduce fu ture asbestos costs.
Sir Colin Hope, chairman,
has told institutional inves-
tors T&N would not take up
cover imlafig the premiums
were relatively modest. Even
if it decides against taking
such cover, it has vowed to
inform shareholders before
the year-end about its plans
to resolve the uncertainty
surrounding asbestos.
In the past 10 years, T&N
has paid out more than
£35 0m ($570. 5m) to settle
claims. Fears of further pay-
outs have undermined the
shares this year, which have
fallen from a peak of 187p
and closed yesterday at l28p,
up %p. Sir Colin, 63, has
made it clear he is deter-
mined to put the issue
behind T&N before standing
down as executive chairman.
T&N has also told inves-
tors that it was pressing
ahead with its stalled take-
over of Kolbenschmidt, the
German pistons maker.
Product
shake-up
at Body
Shop
By Peggy Hoffinyor
Body Shop, the environ-
mentally! ed cosmetics man-
ufacturer and retailer, is to
shake up its range of prod-
ucts in a bid to attract
higher spending customers
into its shops.
Mr Gordon Roddick, chair-
man, said the group planned
to cut its range of green
label products by abont a
fifth, eliminating the
cheaper non-contributing
lines. “The stores are over-
stocked like an overnight
case that is overflowing." he
said.
The revamp, which would
also include new stare for-
mats, was part of Body
Shop's strategy to chase the
“higher average transaction
customer", Mr Roddick said.
Meanwhile, the group was
close to concluding its eight-
month search for a non-ex-
ecutive director to
strengthen the board. Mr
Roddick said Body Shop was
keen to get someone with
relevant experience. “If all
we wanted was a non-execu-
tive director we could have
gone out and chosen a large
orang-utan and put him on
the board," he said.
He was speaking at the |
group's interim results
meeting, where the group
announced a higher-than-ex- 1
pected IX per cent jump in
pre-tax profits to £11. 8m
($19. 2m) in spite of
increased losses in the US.
Turnover for the 28 weeks
to August 31 rose by ll per
cent to £117.1m. Retail sales
- which represent an sales
through Body Shop's M36
outlets worldwide, both
owned and franchised - rose
by 13 per cent to £275.5m.
Losses in the US rose by
$lxn to 83.4m. Mr Roddick
said the recent appointment
of Mr Steen Ranter, a
retailer with experience of
the US market, to head the
division was expected to
“bring significant benefits
to our US retail business".
The shares rose 4%p to
200p.
See Lex
LEX COMMENT
Stakis
Having been out-bid for
both Copthome Hotels and 55t **°*
Marriott hotels In the UK, sham price mfattwr to
It was almost inevitable ttw FTS6 Att-Shme index
that Stakis would offer a 120 -— — — — 7 ■■ v, ~
full price for Metxopole. So
Lonrho has done well to 10Q fr • ■ —
pursue a trade sale rather ■ . '1
than a flotation. Nonethe* n A
less. Stakis has not been 80 ’ I .. rwQ’l
goaded by previous fail- || ' I '. ' -
ores into an unjustifiable so — — ~~Ju — 1
deal - a common pitfall. - (n W w '
Stakis has to add about
£3m to profits to make the - • . W .
deal earnings enhancing in 1 . 1 j ■ » » »
the first year, and most of uw m a n m a esf
that should come from wnumKirr-iri-T
removing head office costs
and streamlining management. Metropole focused on its
highly successful conference business, achieving low
occupancy levels but high room rates. So Stakis should
boost revenues by bringing in a broader spectrum of
customers. The group has committed itself to achieving a
13 per cent post tax return on capital, and It has delivered j
in the past. Furthermore, the hotels are already in good 1
shape, so Stakis win use its remaining financial muscle to :
invest in higher-return casinos and health clubs.
The deal may not excite short-term profits, but it
Increases the group’s clout in a hotel market where
demand is out-stripping supply. On a ratio of enterprise
value to cash flow, Stakis has sunk to the bottom of the
range in a UK hotel sector that has got Indigestion from a
surfeit of flotations. But it is too early for Investors to
worry about the next downturn in demand. And even for
those of a nervous disposition. Stakis’ management has
earned a better rating against its peers.
Stakis confirms
Metropole deal
By Christopher Price
Stakis yesterday confirmed
the acquisition of Metropole
Hote ls from Lonrho for
£327m ($533m) increasing the
number of rooms in its port-
folio by 50 per cent.
The hotel group will fund
the deal through a 4-for-7
rights issue at 82p a share to
raise £22Zm, with the
remainder coming from
increased borrowings. The
news, widely anticipated by
the market, left the shares
lp higher at 99V4p.
The five four-star hotels in
the Metropole chain - in
London, Brighton, Birming-
ham and Blackpool - will
add 2^66 rooms to Stakis’s
portfolio of 5,500.
Metropole made operating
profits of £23. 7m last year on
turnover of £75. 7m. Average
room occupancy was 68 per
cent and the average room
rate was £65. Stakis has a 78
per cent occupancy rate.
Group gearing will rise
from about 38 to 48 per cent
on completion of the deal
Lonrho said the proceeds
would cut debt The disposal
would involve a £58m sur-
plus over book value, and a
£l45m goodwill write-off.
The group said discussions
over the sale of the Princess
international hotel chain
were continuing. Analysts
expect a deal to be
announced shortly with
Prince A1 Walid, the Saudi
Arabian businessman.
Discovery stance upsets Premier
Time securities hm not bam registered under the Securities Act of 1933 and mag not be offend or sold bi the United States
or to l/S. persons except in accordance with the male restrictions applicable thereto.
NEW ISSUE These seaadja hoping been pntoimn lg solti thn announcement a pp ea r s as a matter of recent ordst. OCTOBER, 1996
. By Nikki Tatt in Sydney and
Jane Martinson in London
Premier Oil, the UK-based
ofl Independent said yester-
day that it was “disap-
pointed” with the reaction of
Discovery Petroleum, the
Australian oil and gas group,
to Its increased A$106.5m
($86.4m) offer. .
Discovery directors said
the revised offer, 14 per cent
higher than the original, still
undervalued the company.
However, Mr Charles
Jamieson, Premier's chief
RESULTS
executive, said the 10 cents
increase to 80 cents a share
was a “very fair offer”, and
Premier would now “wait
and see”.
The revised bid falls
within the 77-95 cents a
share valuation range deter-
mined by Grant Samuel,
which was called in to pro-
vide a fresh valuation of Dis-
covery’s assets.
Discovery directors
pointed out that the revised
bid was “significantly?
below the mid-point of that
range, but added that they
were still reviewing the new
terms. Discovery also
revealed that Oil Search,
another Australian oil
group, which bought a 10.1
per cent stake in Discovery
after the Premier offer was
announced, was reviewing
the additional information.
Oil Search has not ruled
out the possibility of a rival
offer. The company, which
operates mainly in Papua
New Guinea, has claimed
that its purchase was driven
by a desire to diversify and
not by the Premier bid.
Mr Steve Lowden, a Pre-
mier director, said the
higher offer was justified by
a “greater understanding of
Discovery’s assets”. Mr Low-
den declined to say whether
the latest Premier bid would
be finaL
The offer needs a mini-
mum 50.1 per cent accep-
tance level. The deadline has
been pushed back one month
to December 11-
Discovery shares rose
three cents to 80 cents, while
in London Premier shares
eased %p to 32%p.
pnuttooj
A* London Inti
BaUjnatny $ ■
Barton —
Body Stoop tatt
bs ;
Bata Resources 4 _
CUbPartmis $
Fflerum —
WBW$
l utaw ppe Tech
just $ -
London & BWlio
POdngton
Premier Health
Rom Bans — — -
itoyai DtndVShoU —
StnOsano $ --
Tandem
Wwtport§
Yr to Jtey 3T
6 rafts to June 30
6 mttw to June 30
. 6 mtha to Aug 3i
5 mfts to June 30
6 mttis to Ju» 30
B friths to June 30
6 mfts to June 30
6 rathe to June so
Yr to Juie 30
B mfts to June 30
6 rafts to June 30
3 mtha to Sept 30
Yr to June 30
6 mfts to June 30
6 rafts to Jusve 30
6 filths to Sept 30
6 mfts to June 30
6 mfts to June 30
9 mfts to Sept 30
6 mlhs to June 30
. B rafts to July 28
Yr to Apr 30
2.19
0.0334
154?
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0 - 896 L 4
0.084L
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0.69714
0.003
2.74
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0.574
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754
0.361 L
(107)
(-)
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(0.243 )
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(05411)
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(1.71 )
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0-61 )
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(3.607# )
(0.105)
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(0-041 )
Culm!
Data at
Cnraapondtig
Tattl far
Total tail
payment (p)
mam
CMtend
yoar
war
14,1 f^f
Dec 18
24
16*
4
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4*
1.5
Jan 9
1.08
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nfl
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3.7
Dec B
-
3.7
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Dec 16
53
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73
1.75
Feb 14
1.75
-
S
The Metropolis of Tokyo
U.S.$250,000,000
7Vs per cent Guaranteed Bonds due 2006
unconditionally and irrevocably guaranteed as to payment of principal and interest by
JAPAN
Issue Price 99.98 per cent.
hwartmant Trust*
Cairngorm BldSocc-
HdaHy Special .
KS UK Somfler -
Ktohwort
Earnings .shown baric,
exception al crodt #4p s
Cnreoi
payment ip)
"W whs in Sent 30 98.5 (95-50 ) 0X28 <- ) ■ 1.93 (- ) 1-4.
J?Yt-toAua31 B 13642 (111.76) 0.081 £-324 ) 022 (0X8 ) -
R nrftia to Sent 30 175.1B (152264) 0.32 (0.493 ) 1X2 (4.37 ) . 1
■iSS ESSS 0.3 cun -
' nhAtonrirmwmn net Howes to terackets are far cnfnwpontfng period, ^tnriud w I0p t
DM) or Corrupouing Total tor Total tatt
wymgit HMdend year year
Stock.. 4Aftar exceptional charge. VAftar
stock. ffNet income after special cracBts.
1BJ International pic
Fuji International Finance PLC
S1NO LAND COMPANY LIMITED””
(a company incorporated in Hong Kong with limited babiUtyi >
USS200.000.000 574 Convaartflyte Bonds dti* 2000
fThe 'Bond®*)
notice TO bondholders
_ „ of sino Land Company United ("tha Company'! on
December, 1996 - .. - 18
SS Z™ i-Kf—
<h«. *»i « »
BvOrderof th, Boonl
Eric Ip Sal Kwong
Secretary
Hong Kong — -
cmBANCo .
Wace share price
halves on warning
Share® in Wace Group
yesterday almost halved in
value after the UK printing
company issued its second
profits warning in six
months and announced the
sale or closure of several
printing plants, writes Tim
Burt
The company saw its
shares tumble from 134%p
to 69Vip. compared with a
12-month high of 284p, after
It warned the £13.4m cost of
withdrawing from low mar-
gin activities would push it
into loss. Wace, the world's
largest pre-press printing
specialist, had been expec-
ted to report.jwe-feix profits
of £i2m-£14m this year.
Yesterday, however, it
said sales- growth had foiled
to materialise and operating
profits would be well below
expectations. The announce-
ment follows a similar
warning in May, when it
was hit by destocking,
higher raw material costs
and price pressure.
In a bid to stem the
decline, ft announced plans
to close its Glasgow plant
and its small New York
printing site. It will also sell
its us print businesses in
Grand Rapids and Memphis
and seek a buyer for its
Dutch printing operation.
Goldman Sachs International
Paribas Capital Markets
CS First Boston
DKB International
Morgan Stanley & Co.
Iftirvinlliiiial
SBC Warburg
AttnMofSttSBMonaraurni
Merrill Lynch International
Tokyo-Mitsubishi International pic
Deutsche Morgan Grenfell
J.P. Morgan Securities Ltd.
Nikko Europe Pic
UBS Limited
24
FINANCIAL TEMES FRIDAY NOVEMBER 1 *996
INTERNATIONAL CAPITAL MARKETS
Brussels announcement lifts Europe’s high-yielders
Emu ‘likely to be positive’ for member countries’ ratings
European Monetary Union is likely to
be positive or at worst neutral for the
credit ratings of member countries,
according to EBCA, the European rat-
ing agency, writes Richard Lapper.
Sharp falls in borrowing and debt ser-
vicing costs, reflecting the fall in bond
yields, would be the main benefit, and
would offset the loss for some coun-
tries of triple A domestic currency
credit ratings.
Mr Christopher Huhne of IBCA esti-
mated that gains stemming frtom lower
interest payments would be particu-
larly large for Spain, Portugal and
Italy, ranging from 2.5 to 6 per cent of
GDP. He said when the credibility of
the union bad been established, the
Emu area would be awarded its own
triple AAA rating. Member govern-
ments would not be automatically
rated AAA because, although they
would have the power to tax in euros
they would be unable to print money.
GOVERNMENT BONDS
By Richard Lapper
and Richard Adams
in London, and Usa
Bransten in New York
The European Commission’s
decision formally to back
France's controversial deficit
reduction measures buoyed
high-yielding European
bonds, ending the jitters
which have dogged these
markets in recent weeks.
Italian and Spanish bonds
both outperformed on expec-
tations that both countries
will have further scope to
reduce fiscal deficits in order
to meet the Maastricht crite-
ria for monetary union.
At Liffe, Italy’s December
BTP contract gained 0.78 to
settle at 123.48. In the cash
market, the yield spread
over Germany - as mea-
sured by the J.P. Morgan
ME UR table - fell from 217
to 214 basis points.
Mr Alex Cooper, manager
with Tullett and Tokyo, said
that at Liffe there had been
fresh - mainly domestic -
buying of BTP contracts,
although some U$ invest-
ment banks were still buy-
ing German bunds and sell-
ing BTPs. Nevertheless, the
EC announcement "had an
effect on all the high yield-
ers and brought hope back
into the convergence
trades”, he said.
Spanish bond markets also
had a good day, with the
10-year December bono gain-
ing 0.62 at Meff to settle at
107.28. In the cash market
the 10-year spread over
bunds narrowed by 7 basis
points to 179.
Ms Phyllis Reed, European
bond strategist at BZW, said
the decision had helped push
convergence trades a bit fur-
ther with yield spreads over
Germany likely to narrow.
"There is a good reason to
push the spreads in further.
In the near term people will
start talking about 150 basis
points in Spain and 200 basis
points In Italy,” she said.
French bonds also gained
ground with the yield spread
of German bunds over QATs
widening out by a 2 basis
points to 4. At Matif the
December OAT future
gained 0-22 to settle at 126.44.
German bonds also made
gains, with the 10 -year
December contract settling
at 99.60. up 0.12.
In the UR. the fall-out
from Wednesday's unex-
pected interest rate cut con-
tinued to subdue volume and
prices in the gilt and money
markets. Long gilt futures
fell for the second day on
Liffe in London. After reach-
ing a high of 109.29, the con-
tract settled at 109.10, down
from 109.17. In the cash mar-
ket, the benchmark 1 0 -year
gilt drifted lower in light
trading to 99%, a fall of
^ from 99& the previous
day. The yield rose 3 basis
points to 7.62 per cent. Call-
ing 4 points against bunds.
The price of the 9 per cent
2008 bond fell from 110& to
109g. its yield was up 3 basis
points to 7.73.
Trading in sterling inter-
est rate futures was also
quiet, with the December
1996 falling 0.3 to 93.71 and
January 1997 contracts Call-
ing 0.4 to 93^2.
The approach of the end of
the month meant that liquid-
ity in the money markets
was tight. The Bank of
England forecast a large
shortage by recent standards
of £1.5bn for the day, of
which only £ 21 5m had been
supplied by the midday
round.
Bat by the afternoon
round the clearing banks*
desire for cash saw the
shortage met by £l-214bn
supplied in a S3 November
15 repo.
Mr Philip Shaw, of Union
Discount in London, said the
money markets were still
adjusting to the interest rate
change. “In practice it usu-
ally takes time for the larger
players to assess the mar-
ket,” Mr Shaw said, adding
that there was a shortage of
hnnir bills on offer, because
institutions needed to keep
them an their books at the
end of the month.
US Treasury prices recov-
ered Wednesday's losses, but
held within a narrow range
as economic data provided
little new information about
the direction of the economy
and traders waited for fig-
ures on October employ-
ment, which are due out
today.
At midday, the benchmark
30-year Treasury was £
stronger at lOOfi to yield
6.678 per cent, while at the
short end the two-year note
rose £ at 100£. yielding 5.757
per cent. The December 30-
year bond future added A to
112ft.
Personal income rose 0.6
per cent in September,
largely in line with econo-
mists' expectations, but
consumer spending was
weak, advancing just 0.1 per
cent.
The low rate of consump-
tion did little to comfort the
market, as it was hinted at
in the weak consumption fig-
ure in the third-quarter
gross domestic product fig-
ure released yesterday.
Instead, the increase in
warning s led many econo-
mists to speculate that con-
sumer spending might lead
to stronger economic growth
in the fourth quarter. Ms
Cheryl Katz, a senior econo-
mist at Merrill Lynch, said:
"We believe that consumer
pending will pick up in the
fourth quarter, but remain
subdued.”
Figures from the Chicago
Association of Purchasing
Management, which are
widely viewed as an indica-
tor of the national figures
due out today, showed mid-
western business activity
remained flat in October, but
a sharp drop In the prices
index did provide some com-
fort to the market.
NatWest offering warmly received
INTERNATIONAL BONDS
By Samer Iskandar
When NatWest Markets
yesterday launched its long-
awaited corporate loan
securitisation, other banks
were surprised and disap-
pointed to be told by the
lead manager that it could
spare no paper. After all, the
11 classes of notes amounted
to $5bn.
But in spite of its size, the
deal was almost entirely pre-
placed by NatWest. the book
runner, with help from six
co-lead managers.
The Rose Funding notes
represent roughly one-third
of corporate loans to clients
of National Westminster
Bank, repackaged into trade-
able securities - bonds
backed by an asset The deal
is the first securitisation of
its kind in Europe. NatWest
Markets handled the place-
ment of 97 per cent of the
amount leaving the equiva-
lent of $ 180 m to be sold by
the co-leads.
Traders said the deal was
warmly received in the mar-
ket due to extensive pre-
launch marketing, with bids
on the dollar-denominated
notes reportedly totalling
almost three times the
$ 2 .ibn on offer.
Bankers in London also
pointed out the geographical
diversity of demand, with a
marked preference by US
investors for the most senior
- Class Al - notes, offered
to “qualified institutional
buyers” under SEC rule
144a, while Asian buyers
were said to be more
attracted to the subordinated
Class A3 paper, which offers
a higher yield.
“We were very pleased
with how it all went", said a
NatWest officiaL "We could
soon be back in the market."
Although all the loans
were of a quality equivalent
to a double- A rating, some of
the Rose securities have
lower grades. This was done
by attributing different lev-
els of seniority to the notes,
thereby allowing investors
to choose from a large array
of risk/retum ratios.
Elsewhere, Greece issued
DMlbn of 10-year bonds
offering 80 basis points over
the equivalent bund. Merrill
Lynch, joint lead manager
with DG Bank, admitted that
the pricing was “ambitious’*,
but said the paper was none-
theless well received, with
preferential tax treatment
favouring sales in Germany
and Austria.
Deutsche Pfandbrief, an
active borrower in recent
days, also raised DMlbn yes-
terday. The issue, however.
was aimed at Asian inves-
tors. Although it follows the
traditional German issuance
procedure, the issue Is listed
in Singapore. Bankers said
up to half the amount could
end up in Asia - roughly
equally split between Japan
and other markets - against
between 20 per cent and 40
per cent for traditional euro-
mark bonds.
The sterling sector saw a
£l50m add-on to an existing
five-year deal by Abbey
National. Deutsche Morgan
Grenfell, the lead manager,
said that although supply of
sterling bonds had been
abundant in recent weeks,
there remained a shortage in
the five-year area.
A FFrl.5bn issue by Rayer-
Lsche Hypothekenbank con-
trasted with recent difficult
launches in the French mar-
ket. "because it fills a gap”,
according to Caisse des
Depots et Consignations,
joint lead manager with
BZW.
Although Bayer Hypo had
already tapped the French
market, CDC said this was
its longest maturity yet.
which meant “dealing with a
brand new set of investors’*
— mainly French ins urance
companies. Observers
pointed out that a distortion
in the market, whereby swap
rates favoured issuance in
12 years while investor
demand was concentrated in
10 years, was partly respon-
sible for recent fiascos. This
anomaly, however, yesterday
seemed to be fading-
One syndicate official in
Paris said: “there are quite
a few borrowers lined up,
but 1 am not sure demand
will follow.”
Bank ers also said a new
jumbo issue by several Ger-
man Linder was expected.
New international bond issues
Amnrt
Cotaien
Price
Matutty
Fees
Spread
Book-mar
Buiiuumi
re. %
%_
_
;* US.DOtMltS '
*'. 5 / .Y.v
' ‘ ■ ::
’
ILOA.E. FutKSfXj(fl«Cla Ala
750
(al)
loaoofl
Nov 2001
0.1 OR
-
NatWest Markets
RO.S.E Funding* Cts A2a
750
(aZ)
100.0OR
Nov 2001
Q.19R
-
NatWest Markets
R-O^-E. Funcftrvgt Cb A3a
500
(a3)
100-00H
Nov 2001
0^3R
-
NatWest Markets
Dormitory Authority NVfsfl
774
ia
(H)
(g)
to)
-
Lehman Brothers
Nonwest Corpt
300
(W
90.91 R
Nov 2001
O20R
-
Morgan Stanley Intt
GECC
250
ejzs
B9.77R
Nov 2001
0558
6(BWH-01)
SBC Warburg
■ d-marks ;•
.
' - a. •
Hellenic RepuMc
ibn
6.75
W.70R
Nov 2006
0.608
80(4/06bund) DG Bank/MotriU Lynch
DePfa
Ibrt
4.75
8897R
NOV 2001
0558
5(8UK-01)
CrmbnfcyMamlVMoigan
Deutsche Hypothakenboik
Ibn
490
9953
Nov 1999
0.19
-
ABN ArrUDrsd/HIbaAIBS
Aflgemalne Hypthknbank^sjt
500
W
100.19
Nov 2006
050
-
Deutsche Morgan GrenfeD
Cotomtotef
275
CT
99.92R
Nov 2001
0.63R
-
Deutsche Morgan Granlell
■ STERLING • 7 '
*
y, ■■
R.OS.E. FuneEngWtds Alb
80 0
(64)
10a OCR
Nav 2 001
0.1OR
-
NatWest Markets
RO.SE. FuntSnsR: Cto A2b
BOO
(a5)
IOO.OOR
Nov 2001
0.19R
-
NatWest Markets
FLO.S.E. Fundfrtg* Os A3 b
600
(aB)
ioaooH
Nov 2001
053R
-
NatWest Markets
AJiboy Ntnl Tramury Srv.(e)
150
7.13
9997R
Mar 2001
0558
17(B9fe-00)
Deutsche Morgan GrerrieU
■ FRENCH FRANCS !
Bayer Hypothekenbank
iibn
6.13
99.65R
Deo 2006
0.358
+22(1)
OZW/COC
Nedertandse Watrachpsbr*
■ ITAUAN UFE " ' ”
Ibn
. . . : ■
6.00
9920R
Nov 2006
0 338
+150)
ABN Amro Hose Govatl
BGB Rnance taaland
250bn
zero
88.73
Nov 1998
155
-
Caripio/IMI Luxembourg
BayorVB
200bn
ais
89.90R
Dec 2006
0508
-
Crodtto ltaSano
Deidsche Rnonce NthrindJ)
Itn
zero
undlsc
Oct 2006
undlsc
-
Deutsche Morgan Granlefl
■ AUSTRALIAN DOLLARS •
. •. = -v — *.
SBAS*
110
650*
10050
Nov 2000
irodlacl
-
KokusaKEroVToyo Trust
. * - -
'u • - .« ' 7 -
- !l
-» .
- _
Fknl terra, nort-cfele untoss stated. Yield spread (over rtvnt gvt bond) at launch euppfted by lead manager. * Unlisted. *
Floating-rate note. tSemFonnual coupon. R: fixed reefer price; toes shown at ra-offor i ever, aj IT -tranche issue worth
approx SSbn. Shot let cpna. al) 3-mth USSLibor+Bbp. a2) 3-mth US$Ubor+180p. S3) 3-mth USSUbor+22bp. Ml 3-mth
EUbor +8bp. aS) 3-mth nihnr +18bp. aS) 3-mth EUbor +22bp. afi) Fees latdbc. Cte A4a SSSm. 3mth USS Libor +40bp;
CtoMb Cl 0m. 3mth niw +40bp. a7)Fee& imdisc; Cls A5a SZ7m. 3mth USSUbor +65bp; Os A5b Cl 0m, 3mth £Ubor+65bp.
aB) Cb B 5100m. (4 3-mth Libor +5bp. cj 3-mth Libor aertu d) 3-mth Libor +140bp. a) Fungible with STGZSOm. Plus 249
accrued Interest- f) Added to L3tiWlan. g) Multi-tranche band. Prtttrtg today. Q Over Interpolated yield, s) Short 1st coupon.
WORLD BOND PRICES
BENCHMARK GOVERNMENT BONDS
Coupon
Red
Date
Price
Day's
change
Yield
rar^.L
W68K
ago
Month
ago
Austroia
6.750
11/06
955630
-0570
7,41
7.42
7.06
Austria
5.875
07/06
9a 5400
+0.100
6.07
6.10
6 16
Belgium
7500
05/06
1065300
+0.110
0.12
6.12
6.40
Canada '
7.000
12/08
104.0200
-0-080
6.45
6.50
756
Denmark
8.000
03/06
107.5800
+0.080
6.87
6.88
7.13
France STAN
5500
TQ/U1
1025820
+0.090
4.96
457
S.33
OAT
6500
10/06
1035900
+0.190
557
6.00
622
Germany Bund
6560
04AM
101.7100
+0.100
6.00
6.05
650
Ireland
B-ODO
08/06
107.3500
-0.100
654
6.94
7.18
Italy
9.500
OZA16
108.7000
+0510
0.13T
8.13
8.84
Japan No 140
6.600
06/01
122.439 T
*0.030
1.49
1.52
1.77
No 182
3.000
09/05
1035056
+0.190
252
2-64
2.85
Netherlands
8.500
06/06
118.4600
+0.130
5.93
S.B7
657
Portugal
9.500
02/06
1125200
+0.330
7.57
759
857
Spain
8.800
04/06
106.4400
+0.610
7.70
7.81
8.11
Sweden
6.000
02/05
91.9845
-0.060
7.31
750
7.65
UK Gilts
8.000
12/00
103-03
-3/32
7.11
657
7.10
7.500
12/06
99-04
-7/32
7.62
7.62
7.82
aooo
10AJ8
109-26
-7/32
7.73
7.73
753
US Treaswy *
6.500
10/06
100-27
+1/32
658
6.58
6-64
6.750
08/26
100-27
+1/32
8.68
657
755
ECU (French Govl)
7.000
04/06
1045100
♦0540
857
657
651
London dosing. -New York ired-doy Ytatac Local niM standard.
r Grow (inducing wthnortimg cox at TZ5 per cent payatta by nwtoMeid
Rices: US. UK mi JZndH often m Oeatrar Same: MVS It eem a eonel
US INTEREST RATES
Lalesi
Tnxnwy Bflts
1
1
One man® —
.....
Ttoyere
5i79
Prtaieatt
Broker tan «■
SV.
7
Una 111* fli ...
Three month-
‘ZZ'LZ. 516
Three year
Fbeyear
5.82
6.12
Fretted*
Fettfimts at hnnwidtan
5%
9* month
(to yes —
559
5.43
10-ytor
30ya»
640
699
BOND FUTURES AND OPTIONS
France
M NOTIONAL FRENCH BOND FUTURES (MATIF) FFrSOO.OOO
■ BUND FUTURES OPTIONS (LIFFE) DM250,000 points of 100*
StrSre
Price
Dec
Jan
GALLS “
Feb
Mar
Dec
Jan
PUTS
Feb
Mar
0950
a 54
054
0.56
a69
0.44
1.26
1.48
1.61
10000
050
051
040
051
0.70
153
152
1.93
10060
0.15
0.12
□58
0.38
1.05
2.04
250
250
EaL voL total. Cato 12079 Puts 0822. Prarioua day^ open tat. Ctoa 104064 Pub 179908
Italy
■ NOTIONAL ITALIAN GOVT. BONO (BTP) FUTURES
(UFFE)* Lea 200m lOMhs of 10036
Open Sett price Change High Low Eat vot Open int
Dec 122.90 123/48 +0.78 123.85 122.90 45891 84560
Mar 1 22.32 1 22.89 +0.77 122.32 12232 140 3603
■ ITALIAN GOVT. BOND (BTP) RJTUBES OPTIONS (LFFE) Ura2Q0m IQOtta d 100%
Strike
Price
Dec
■ CALLS
Mar
Dec
. purs
Mar
12300
157
155
0.79
258
12390
058
1.71
1.00
252
12400
0.74
1.49
156
250
EaL vd. total. Cab 7080 Puts 1658. Previous coy a open hr. Cafe 192582 Putt 179994
Spain
■ NOTIONAL SPANISH BOND FUTURES (MEFF)
Open Sett price Change Hltfi Low Eat- vgL Open 1m.
Dec 106.70 107.31 +O.B1 107.58 108.70 78.006 70,017
Mar - 106.74 +0.82 - - 88 338
UK
■ NOTIONAL UK GILT FUTURES (UFFE)* £30.000 32nd8 of 10095
Open Sett price Change High Low Eat vol Open hit
Dec 100-19 109-10 -0-07 109-29 109-03 100836 154582
Mar 108-26 108-16 -0-05 108-20 106-28 53 2209
■ LONG GILT FUTURES OPTIONS (UFFE) gSO.OOO 64ttis of 100%
Strike
Price
Dec
Jar
CALLS “
Feb
Mar
Oec
Jan
PUTS
Feb
Mar
100
1-01
0-63
1-21
1-37
0-45
1-31
1-53
2-05
110
0-34
009
0-59
1-10
1-14
2-07
2-27
2-42
111
0-16
0-23
0-40
0-S4
1-60
2-55
3-08
3-22
EOL vd. tom L Cato 10142 RjM 3*85. Prewous OaVa epan tat, C*s 4O140 Puts 20030
Ecu
Open
Sett price
Charge
High
Low
Est vd. Open bn.
Dec
126.38
126.44
+052
126.62
12656
96.679
188.917
Mar
126.36
126.44
+052
126.52
126.36
2.454
38,817
Jun
125.10
125.20
*054
12552
125.10
620
5.614
■ LONG TERM FRENCH BONO OPTIONS (MATIF)
bfntup
- CALLS -
PUTS -
Price
Nov
Dec
Mar
Nov
Dec
Mar
124
2.52
-
05B
050
0.52
125
1.64
-
-
0.19
0.38
0.78
128
089
1.15
1.61
043
0.70
1.12
127
0.37
0.65
1.09
-
■
-
128
0.13
0.33
069
-
-
-
Ew vcJ
■GUI. Cite 17,970 Puts 1 J.SM Previous Cay's opwi nt. Cabs 162.776 Putt 147,7*0
■ ECU BOND FUTURES (MATIF) ECU 100.000
Open
Sea price
Change
High
Low
Eat voL Open Int
Dec
83.80
3358
+0.06
94.10
9350
2511
7539
Mar
-
93.54
*0.08
-
-
-
26
US
■ US TREASURY BOND FUTURES (CBT) SI 00.000 32nds of 10096
Open
Latest
Change
High
Low
Est vd.
Open Int
Dec
112-18
112-21
+0-02
112-26
112-12
423539
387.155
Mar
112-00
112-07
*0-03
112-10
112-00
2.567
25.873
Jun
-
111-30
-
-
-
477
5536
Germany
to NOTIONAL GERMAN BUND FUTURES QJFFE)* DMTSO.OOO IQOths of 100%
Open
Sett price
Change
High
Low
EaL vol
Open mL
0944
99.60
*0.12
99.71
99/44
113950
252357
98.54
9856
♦O.I2
98.66
98 54
1375
15601
Japan
■ NOTIONAL LONG TERM JAPANESE GOVT. BOND FUTURES
(UFFE) YIQOm IQOths ol 100%
Open Close Change H&i Low Eat. vd Open Int.
Dec 12548 12548 12532 2073 nfe
Mar 124 56 124.59 124.48 456 n/a
• UFFE runroa otto Bated on APT. Al Opari taurom flea. are tor prevtaua duy.
UK GILTS PRICES
. two
tot Red Pncof *<s-
W Lon
Rota
H
Rea
FnceE *or-
«9»
Lon
Traa«7%pc:W»»—-
756
re:
99ft
-ft
lOtij
9*!2
Trsai7Viica»6W. ._
7.70
765
100JJ
-ft
103%
96,’.
Treas8prSXG-6t*
704
754
102
*ft
i(Wi
97%
rrea n<iPiaU3-7 . ..
«7t
745
<Xii
-%
I2Sft
nay
Tren8%pc 2DD7 tt
mw
768
1951)
-ft
10BIS
101ft
Traas 9pc 7008 tt
arc
773
109)2
112)2
103U
TreuBpcTaOS
786
7.7E
101 J3
-ft
104%
98J1
Tranfi i/*pc3HB« .
7N
787
86%
-ft
W.
81%
Canr9pc LnTOIl It
a 19
70S
loa'i
-A
1171/
104%
(2)fttn£ +cr- me Low
Ciswsrawn iflpc 1996 - .
9»
619
109%
I03«
100%
Turn 13% pc 1997ft
1105
a ic
101%
107%
100%
tish 10%PC 19J? — .
10 37
598
<01ft
107ft
100,'
Tfcu Dw ipc 1997ff- .
646
en
100ft
tiny
>00)3
Time B%pe 1907ft
S58
677
ioiu
- i r
10753
IOIU
Each UpctflS? ... .
1386
634
1118,1
~ir
115)3
IUWJ
Each 9>«pc 1998
940
642
103B
1«l*
100, 1 ,
ircas7l*Kl993tl . .
718
6 51
too;:
-ft
109)3
100%
Haas I5%pc OBtf .. .
1J4C
670
n5ii
*A
UWj
11513
Ekjii. T ic 1996 .. -
10 93
ft77
109Q
II4V|
1C9Q
Tce»0%pCia99tf- -
902
6^
105%
108ft
■ lb ft
1rnj*F48 Rata 1999
-
-
iaoft
*3\
Etth i:>spc 1999 . . .
10 96
6 85
111%
-ft
H8()
non
Trwi UJijpe ifflo —
970
698
108ft
117ft
108ft
Tress 6PC 1999 ft
6.11
683
srtS
B9>4
9i%
Cttiwiuan 10>4K 1999 .
9«
596
100(7
-i.
T 1214
109(1
Cora 9pc flXWf
B51
701
I05U
-ft
iiwi:-
uni3
lHa*l3pcMW .. _ -
11)94
7.12
usa
-ft
124)3
'Nil
Ireas 14 k 19TO-1 . .
12b5
563
non
1 17 ft
HiH)
Tnss 3gc 20Wft
776
711
103ft
■M
105%
101ft
Tims Fla ftto 2001 -
570
“
*»*
UM.
Trex 10DC 3001
909
730
110ft
114
lOOfl
4%pf»tt — 1135 .fl)
2%|>C HI 4783)
r%pcTO (710
4%pcTK« It 35.0
QiC-OE 453.31
2%pe-® 478 a
Z'tfC'll (74fl
2%l*13 4883
3%gc'iB 481 St
r%« 20 man
: l iPC74# (97.71
4%te Jttff — 413S.lt
09
266
131
an
117
049
IX
a<3
1*7
ia
153
153
2J9 lias
123 1B«%
134 iacH2
138 117JJ
146 183%
353 170,'.
357 I75J]
161 144,' t
38* 1S3B
186 1*7*
168 122ft
167 120JJ
-A H4% 111ft
-D 1B5fl 176%
-% I8II1 171 JS
HSfi 112J|
-% iai>t tnu
-JJ 172 181ft
-ft inn ifiBft
-% l«il 138ft
-fi IBS 145A
-% 'toft 133U
-Ji 1MJ| 115ft
-A 122fi 1134)
Tress 9oc 2012ft
818
7 88
110ft
-i
113ft
104JJ
Tiro S%BC 2008- l^f
683
766
soy
-ft
82%
75%
TrMsSoeJOISfJ
792
799
101ft
u
103K
9ft
IresaTVpcSOIS'lSff—
785
788
9B%
10 m
93U
TrenftsiDISff
79»
787
101ft
"ft
10*i
99ii
Tmasa%pe20i7ff
800
7S3
108ft
-ft
111%
102%
Erthiaac SOI 3-1 7
ass
789
138%
-ft
141)3
13013
Tress Sac 2021 «
790
788
101%
-A
103%
95«
Prospective retd i tara npite M tele on protec te d Wfetkjn of hi
10% and O 5V « Hgeea In p ai a nt he a e s show HP! base tar
Mating do 8 month* prtor 10 tssua) and have been ad|uewd 10
reflect nbaang of m to 100 n February 1887. Conversion
factor 3.9*5 FW tor Februsy 1996: 150.9 and lor S eptemuer
1996- 1518
Other Fixed Interest
-tit*- _ - 52mk_
Bates tal tod Price £* nr- Hqp ue>
Rwta RRaanTaatt
Irsas 7 dc 2001 ft
Trcaj 9 ipc 2SD? „ . .
Tens 9pc TOttJff . .
liras icee 2003 _. .. .
7 07
878
7.75
881
722
737
737
744
99d
Ml
103ft
1131!
-A
-ft
-%
-%
101 A
114%
lOSil
117ft
96%
108%
99)1
38
menu
811
-%
0*1)
78% War Loan 3%oOi
795
Cafwnttifli2ic2004._
Tre>s6W 2004ff
Ctn»9%ps3#5 —
352
707
850
755
752
7 JO
111ft
os,;
lltfi
-.1
"A
-jj
IMft
Vu
11*0
1071:
91 ft
108ft
GowHs* SI All . ...
TiwSpCGEAft
577
818
Treos 1I 1 »c200J-5 —
TreasB 'rPCZOOS# —
802
7bfl
low:
-a
I31 *a
lOBii
101% Tim Jijpc
ait
AsurOw 10%pc2009_.
860
794
118
130
1118
Stott iHa*3012
909
845 ITBljd
ITS
uaij
kta a* s%pe 'ia
804
-
105%
105%
105%
toe Gap 1986.
BBS
-
104
104
10*
13DC Y7-2
11.12
110%
110%
110%
If«ai3 l roc2006 —
1011
-
133%
1381a
1?fl
Hj
^ Lhmwi3%CclTOl
an/
-
39
41
33
44
-4
4%*.
41.1 LCC3K :««■ — •
008
33
36
33%
60 d
62%
58ft *bach«arlliaie3>07-
9J9
833
122 lj
134%
117
36|1
J* ttfl.Wtr.3oeF
LB0
7.10
79
BO
70>a
FteleADBBj3Vc2021
-
421
143%
144ft
133
JIB
33%
28% 4%oclL21&4- -
-
*33
138%
.. _
140%
130%
30)2
1*
32ft
23% UttUttSBtaieljKaM
12 37
-
135
136%
120
to Tte' tuck. *t Tax-awe to non+esnarci on a ntfe-n rion. E Auction con. «t Ex dtvtoond. dosing md-erices ore shown In petavte per £100 nonenol cf Wtvfc
Prospective rad keta-UNuid redorafton yttftb ore cafotond by HSBC C™*w»a ton Bn* o’ Ei^iwvd etoeng pdeaa.
FTSE Actuaries Govt. Securities UK Indices
Price IntScee
UK GBIto
Thu
Oct 31
Day's
change 96
Wed
Oct 30
Accrued
Interest
xd at#,
ytd
— Low coupon yield — ■
Oct 31 Oct 30 Yr. ago
Medhrni coupon yield ■- Mgh coupon ykrid-
Oct 31 Oct 30 Yr. ago Oct 31 Oct 30 Yr. ago
1 Up to 5 yean (21)
121.39
-0.04
121.45
2.74
8.04
5 yrs
7.22 720
7/42
727
7.23 7/42 7.32
729
7.51
2 5-15 years (19)
749.30
-0.12
149.49
Z8S
9.09
T5 yrs
7-83 7-81
7.99
122
7.80 8.04 7.85
7.83
811
3 Over 15 years (8)
166.52
-0.15
168.78
3.79
9.83
20 yrs
7.83 7.91
804
7.90
728 8.07 7.92
721
814
191.43
-a 31
192.02
4.68
aB3
treed-t
&OQ 757
8.13
5 All stocks (54)
143*1
-0.10
14356
3.02
8.92
— krtletlOfl 5% —
— Inflation 1096 —
Index-naked
Oct 31 Oct 30 Yr. ago
Oct 31 Oct 30 Yr. ago
6 Up to 5 years (2)
202.46
-Q.15
202.78
0.47
528
Up to 5 yrs
3.17 3.13
322
2J2 2.47 2.10
7 Over 5 years (109
193*9
-0.33
194.23
1/43
4.17
Over 5 yrs
3.00 357
3.87
3^0 3.37 3-47
8 AD stocks (12)
193.48
-0.31
194J08
1.32
4^1
A verage gross redgropbon yWte ere shown above. Coupon Bendc Low: Mt-Tnvfb; Mateen: 8%-1M»%: High: UN and over, t Flat ywks. yta Vow to deto.
FT Fixed Interest Indices Gilt Edged Activity Indices
Oct 31 Oct 30 Oct 29 Qct 28 Oct 25 Yr ago HgT Low* Oct 30 Oct29 Oct 28 Oct 25 Oct 24
Govt Secs. (UK) 98.89 03.88 9320 94.14 94.2? 94.14 96h4 91.50 Git Edged bargains 86^3 85.3 1225 97.6 101.1
Fixed interest 115.35 115.46 115.31 115J0 115.50 112.42 116.45 110.74 ■ 5^toy average 985 99.0 108.9 B6.9 109.5
O FT8E M a metionel Led 1996. Al righto te—tw d . • tar 1901 Government ScartM high since c ompArtra: 127.4 (tWOI/35). low 4118 KEVD1/75L Read WWW
Ntfl erica compMton: 13387 QiiOIA*). low 5063 (03/01/75). Bate 100: Qowrrxnan t Secuteee IShOOS and Fixed tatarasl 1901 3E acbvfty Megs rebaaed 1974.
FT7ISMA INTERNATIONAL BOND SERVICE
Ltoad we toe latest I to national
bonds for ntieh toere ia in adequate nctntoy
bauad Bid Oder Chg Yield
pdoaa at 700 pm on October 31
toeued Bd OCtar ChgYWd
Issued Bid Oder Chg Yield
US. DOLLAR STRAIOKTS
AEbsy Tnasuy 8^ £0 — 1000 99%
ABN Also Bank 7^ 05 1000 1021,
AttanOwBk7^23 500 09%
Sweden 8 07
Ateita Pro** 7*8 aa
Asian Dev Boric 8*4 05 .
AutfaB^ 00 .
1000 1031,
. 750 07^
.400 108*2
Bedan-Wuedt L-FtaB^OO — 1000 IOSJj
anomod 7\ 04 1000 84
Bank Nod Gemeerten 7 99 1000 102^
Bo)v Vodrotk 8 1 , 00 500 105^
Bayun 54 03 1000 94*2
Bittah Cokntia 73i Q2
8rtbhG*s021
Canada Big ®
Cheung Kcrg FVi 5I7 96
omaBizD*
Oedi FanctoOlg 99
Denmark 5\ 96
EanJapaiMwav^O*
BBS 04
ffl9>4 97
Sac da Ftonoa 9 96
E»4n Bade 0 02
Export Oar Oorp 98
Exxon Captol004 —
Fad Home loan 7 1 * 99
Federal Nail Mon 740 04
Finland 6\ 97
Fcad Motar CredR 6U 96
Qananf Mb0l3
N RcnceS 1 , 98
ttr-ATerDwB 1 ! 06
WarAmer Dav 7*j 05
MFtaanca5^*99
Sair B 03
Bdy6%23
Jqai Dev St 8% 01
Korea Bee Power EPa 03
MatsuTtta Bee 02 -
Onav3 7>B 03
Qatar Kotectoar* 8^ 01
Pamigal 54* 03
Quabse Hyde 9ft 96
Quebec Plw998
SAS1099
SNCF 9^2 96
Span 8*2 69
Sweden 6>2 03
Tomoecco Vtoey 6 00
Terrasaaa Ualsy 6 1 , 05 .
Tckpi Bee Rcawar 6*g 03
Toyoto Motor 5% 66
Urttad lAgdom 7^s 02
Wall Ctanay 01
Wbric Bank 61, 05
WarU Bar* 6^96
DEUTSCHE MARK STTUKHTB
««b 6>i 24 2000
Bafen-WuHtt L-Atomoe 6 98 . 2000 104%
Creek Fender 7I4 03 2000 106^
□aranak 6% 96 2000 103%
851 UtoOKhgdcm 7l*07
704 Wtowgan W Fto 7 03
73B WtartdBn*5%03
533 World Bank 7*, 05
871
621 SWISS FRANC STRAIGHTS
623 Asian Dm Bmk 016
.2500 104%
S600 100%
1000 106%
3000 101%
3000 107%
84% -% 1072 Austria 4% 00 .
500
604 Oounsl Ettope 4% 96 .
627 Dwnwk*%09
650 BB 3% 99
646 ffl6%04
7 JO Frtand 7% 99
17% 00.
tattr Amsr Dw 4% 03 .
Onbsto6%03
Ouabec Hyde 5 06 _
S4CF704,
14% 03
Wcrid Bttk 021
556 Wcrid Berk 701
593
845 YSfSnUIOHTS
557 Sa^srn 599 —
858 Credi Fancier 4% 02
610 EB B% DO .
1000 106
- 250 103%
1000 105%
1000 103%
-300 114%
.300 112%
_100 115%
-600 106
-400 113%
_ 100 103
-450 119
. 500 105%
-700 29%
-600 115%
_ 75000 111%
_ 75000 118%
,100000 117%
687 Bv+n Bank Japan 4% 03 _ 105000 113%
595 War Ame Dev 7% 00 30000 120%
643 My 3% 01 300300 107%
846 toy 504 200000 117%
602 Japan Dev Sc $99 100000 111%
670 Japan Dav Bk6% 01 120DCD 122
673 SNCF 6% 00 30000 117%
125000 119%
.150000 106
593 Spdn5%0Z.
660 Sweden 4% 96
752 World Bark 5% (B
030
704 OTHB1 STRAIGHTS
859 Cedi Bandar 793 02 LR .
666 SB 7% Cb IFf
639 WwW Bank 8% 04 LFt —
A8N Amro 6% 00 B _
Autota6%99H
BN Canada 10% 09 CS
.260000 117%
2000
104
. 3000 10B
.
, 1000 10B%
. 1000 106
ISO 113%
SUdi Cduntata 7% 03 CS — 1250 106%
Ctosdb M9 * Hsg 6% 99 C5 . 1000 106%
SB 10% 98 CS 130 107%
Sac da Ranee 9% 99 CS 275 112%
KIW ha Fin 10 01 C$ 400 116
673 Nppon Td Td 10% 99 C6 ■
642 OtartoB 03 CS
.200 113%
109%
599 (Maria Hytto 10% 99 CS 500 113>2
624 Oder KvtrcKxnk tO% 99 CS - 150 113
OMbecHvdo?04CS 1000 102%
Owbec Rw 10>2 96 CS 200 111
Card Snpa 9 01 Rai 1100 114%
Crack Fender S% 04 Ecu 1000 111%
94%
Depfa Firanca 6% 03 .
Ctautete St Fta 7% 03 ,
SC B% 00
— 2900
LKB Baden-Wum 08 _
— 2250
Noruqr 6% 98
_ 15QD
Span 7*4 03
- 4000
1500 102%
2000 108%
108
tm
94%
107%
103*2
103
106%
106%
106%
105%
104%
101 %
103%
101 %
10B%
DetmarX 8% 02 Ecu
6S3 B36 03Ecu
4.13 m W 01 Ecu
591 Fere del Sa 10% 98 Ecu .
-% 399 BW 10% 00 Ecu.
596 Unteri Mngdcm 9% 01 Ecu .
591 ADC 1099 AS
TQ00 113
. 1100 103%
. 1150 117%
- 500 HS%
. 1000 117%
2750 114%
.100 106 %
452 Cam Sc (tenia 13% 99 AS- 100 116%
455 BB 7% 99 AS 333 103%
449 Mav Treaary Zero 0 20 AS — 1000 16%
15B R & I Bark 7% 03 AS
637 Sara Bk NSW 002 AS
369 SB>A»tGaMfti902AS ISO 107%
596 U*mt Austin 12 98 AS 150 105%
566 Weston Auk Trees 7% 98 AS _ 100 101%
.125 101%
.300 107%
104%
103%
106%
101 %
107%
38%
106%
103%
105%
103%
11^
112 %
116
106%
114
103%
lift
100
20 %
113%
111 %
113%
117%
113%
120 %
107%
117%
111 %
122 %
118
719%
105%
117%
105
107
106%
106%
1131%
108%
106%
10B%
112 %
116%
114
109%
113%
113%
103
111 %
114%
111 %
113%
104
117%
106%
117%
114%
107%
117%
104%
18%
101 %
107%
107%
107%
101 %
-•a
353
Abbey Ndl Trewy 8 03 2
— 1000
101 1«
101 J|
-%
7.73
135
MshZjndS%23£
150
665
598
Drank 8^« 98 £
800
99%
100
693
559
Depfa Bran 7%03E
500
BBS*
-%
7.79
692
BB800C
— 1000
102%
102 s !
-%
752
Gtaxo Wricoms 84| 05 E —
500
103%
10*1*
J 4
8.13
Hanon 10% 97 E
500
1031b
103%
-%
693
515
HSBC Hokfegs 1199 02 E
153 116%
116%
J 4
898
257
* 10»2 14 £ .
400
11B3g
118%
->4
644
2.17
Acer Dev Bk 7 00 £
200
9912
99%
-%
7.15
237
Land Secs 9>z 07 £
200
107
107%
-%
846
219
Oman 11% Ol £
100
112%
112%
-%
791
*
448
FbwogoiS^ 03 £
250
1041b
104%
-%
891
285
Saran Trent 11>2 99 £ —
150
1094
110
795
324
Tckyo Bk Praw 11 01 £ .
150 I12V2
112%
-%
796
173
TCNZFta 0% 02 N2S
re
107
108
798
*
394
World Ba*999NZS
250
102%
103%
-%
7.74
495
Credt Uxd 8 01 FFr
— 8000
103%
103%
814
4.14
Darak5%99F8-
— 7000
103%
103%
492
*
175
Bee da France 3% 22 FFr _
3000
122*8
122%
r>2
698
5.13
118
FLOATING RATE NOTES
230
199
228
138
191
291
1.11
1J6
138
196
nm
678
622
460
394
618
636
496
412
597
5.72
5.18
627
479
503
664
491
591
642
tested
ad
Otter
Cepn
Ataey Nte Treasury -ft 99 .
- MED
9895
10082
sewfl
Bttkzrarica % 99 . .
— 750
Bags
100.07
5.7500
Cbnacb-% 96 .
- 2000
9867
9973
52852
CCGE 0 06 Ecu
-200
9882
9084
42578
Commerzbk Q/5 Fin -% 98 .
_ 750
9981
9989
54082
Crafl Lymnris ft 00
_ 300
9802
9853
55375
Dreataa Ftaaice ft 98 DM .
_ 1000
10092
10012
11602
Fed Na Mat -ft 00
_ 1000
99.73
9985
54492
Ftafcrad-%99
_ 1500
9893
IOOOO
54609
HaEe* BS 0 99
M Bark Hi >4 99
_ 500
10044
10054
52812
_ 1500
10031
10038
5S938
fc/y % 98 Bai
_ 1500
10830
10031
4-3125
LKB BadmvWuwr Rn -% 96
. 1000
9990
H9S7
5.47GB
Uoy* Bank Pern S 0.10
-.800
86.78
6758
88295
UtayaaftQS
_ 030
aa 79
99^4
5ES75
New Zaatand J* 99
_ 1000
9995
10050
54727
Nova Scotia ft 99
_ 500
9899
10007
5.7266
Ovk'bj 0 90
- 2000
loata
10010
15000
Porfugri ft 99 DM
. 2500
10032
10037
11875
CMCmc Hyrto 0 99 —
-500
oara
99.79
586C5
Rerte098
-500
9979
9985
5X375
Span -ft 02 nu
_ 2000
10013
10019
13477
State 0k Vctorta Q05 99
_ 125
10000
10013
58469
Sweden -% D1 ..
-
9958
9958
54141
Unted Kingdam-% 01 2000
9875
99.73
5.3750
C0NVBTTBLE BONDS
Com.
fareuad
Price
Bid Otter
Piwn.
ABed-lyone 6% 06 C
Gold KrigcxTfe 7% 00 .
200
.65
604 88% 99% «4S1
, - - , 137 113 114% -1344
Gmd Msktsictosn 6% 00 — 710 437 117% 118% *75
Htoson Amanca 239 01 420 17949 37% 37%
tt^fengUndAOl 410 3195 37 97% -1277
Land Seer 6% 02 £ 84 972 102 105 -413
Lmo7%05£ 90 564 93% 95%
2000 22 110% 111 4490
496
327
4.47
517
529
793
7.16
639
796
749
737
748
694
679
MBL tas Rn302
MSauiBark2%03.
ogdenSffi,
200 23329 S1% 93% *138
■ 85 30077 Z?% 93%
500 562097 117 116 *66
TCO 130226 109% 110% *90
76 92% 93%
Pmzol 4 % 03
SmdazQtoW2ffi
BVI Ffetoce Tlj CE 2SD
Sapporo 1% 00 40000 10S9.4 103% 104*2
anttemo Bank 3% 04 — 300 iRnfio g^il gg% 44472
Sat Afa nca 7% 06 £ 155 39 111% 112% +1675
TfaTsatodc Ffttgs 51; 09 £ . 750 iflS 801, 8T»9 +11.72
agfcMe. . prevtora dj/s ptae
- Cmkr am neU mte a prtoo
SnuuBHTI
BOMJ ft Tho yw ld a the yoU id wtovlgn a* the Udptea: toe wraw* lamed to n mtoora a oevency watt. Cte agnOton m
RSI* HUlBk Denamntod kt daSn treats adi— tt a n-Snaail Capon tew b nSntaton. SpraskMonn — - .
Gcp wTte cw rae cac n a«rw te-roomi c41uuf nte (tSnMivHh Sabam mean nsd lor US detosa
PWW WfWJI BOIto ra Pano rwatod h dotora iriaaa otfwwtaa hxteasad. Omr. la todtantosl ernous of bond pa arm agraBrel n Amxy & a
pernhrn ar the aim rifean prtsa a aegamg Sn tea the band over the mewl racer* pa d the riiw m.
t oon v eB Mi row s«ad m Issue rm i u/tou e no o n
C Tte Snsndal Tknas Lid. 1096 Reprotecaoi in afteta or ta Dart ta my Item ml parnraa fl «4ni wntton casare. Ctoa ■ _ _
Or teraua SecttofcB Moriari Aeaaeudon.
t
M.
at
6
V
M«> *
tftimas
^ANCIALTTMES
FRIDAY NOVEMBER 1 1996
CURRENCIES AND MONEY
Swiss franc declines on gold rumours
markets report
By-Graham Bowley
■Hie Swiss franc fell sharply
on the foreign exchanges
yesterday a m id rumours
ti3flt Swiss authorities
are considering a suspension
of banking secrecy laws to
hdp find Nazi gold hidden in
Swiss hanlrg
The pound ended flat
against most currencies after
another day of volatile trad-
ing over concerns that thfc
week's interest rate increase
might presage large Budget
tax cuts.
The Italian lira strength-
ened after a Bank of Italy
economic report suggested
the economy was slowing
but that interest rates were
unlikely to be lowered.
The lira was supported by
rising expectations that Italy
would be more likely to qual-
ify for European monetary
union. This followed the
European Commission’s
decision to give formal back-
ing-yesterday to France’s'
POUND SPOT FORWARD AGAINST THE FC
controversial measures to
reduce its budget deficit to
Qualify for a rtfngfo currency-
This makes it more likely
that Italy would be able to
meet the budget criteria for
Emu, traders said.
The dollar moved in nar-
row ranges ahead of key
employment data due today.
Analysts said the dofiar-was
vulnerable to any weaker*
than -expected jobs numbers,
since this would hit expecta-
tions of a US interest rate
rise
The dollar closed in Lon-
don ag ainst the D-Mark at
DMi.513, compared with
DM1.507 at the previous
close. It finished at Yl 13,74
against the yen, from Y113L9.
The pound closed almost
D-Mark
and
dollar at
DM2.4641 and 51.6284. The
■ Peered la Mere Yerik
Oct 31
-Utoat—
-Pie*, dare —
Eapot
1.B26S
14335
1 mtti
1.3233
14325
3 mtti
T4233
T43D0
iyr
14124
141 »
daring Change BSdfoflw
mM-potnt on day oprMd
Day's arid
high low
Europe
Austria
Belgium
Denmark
Finland .
Franca
Germany
Greece
Inland
Krfy
Luxembourg
Netherlands
Norway
Portugal
spam
Sweden
Switzerland
UK
Ecu
SOFtf
sterling trade-weighted
exchange rate index closed
fiat at 90.2.
The French franc moved
higher following the Euro-
pean Commission’s
ann n nrwwnwit This Was in
spite of a five basis point cut
to 3b20 per cent in the Bank
of France’s intervention base
rate. The franc was trading
at about FFT2L3765 against
the D-Mark at the end of the
day in Paris, against
FFr3.379 the previous day.
■Rumours of a suspension
of Swiss banking laws
prompted a swift decline in
the Swiss franc in late trad-
ing yesterday.
Mr Tony Norfield, treasury
economist at ABN Amro in
London, said: “If the secrecy
laws are suspended then it
opens up the risk that lots of
people who traditionally use
Swiss bank accounts are less
■likely to put their money
there.” This raised the pros-
pect of a slowdown of Sows
into the franc which would
weaken the currency.
Oo# month Tim months On* jmt Sank of
Rf HPA RBI %PA Ran %PA Eng. mom
-I
:-r.- ast K
; ;iaaqwy re£ - I:/'"'
v f. ? s*' *•*' t:;
tj8ir.4g yr • • :'j- • }
He said this would play
into the hands of the Swiss
central bank since it wanted
a weaker franc in order to
ease pressure cm the Swiss
economy.
He said a potential Inves-
tor flight from the Swiss
franc could benefit European
high yielding currencies
such as the Italian lira.
■ The dollar began the Euro-
pean trading session weak
bat recovered some ground
later in the day .
Mr Joe Prendergast. for-
eign exchange strategist at
Merrill Lynch in London,
said there was still an upside
bias to the dollar against the
yen in spite of its correction
of recent sessions.
He said he expected
today’s employment num-
bers to show some recovery
in activity from last month’s
weak reading. But he said
they were still likely to be
subdued “which means little
support for the dollar
against the yen". ..
Mr Norfield said a weaker-
than -expected figure would
probably boost the dollar in
the short-run since it would
prompt buying of US govern-
ment bonds. But in the long*
Oct 31 C S
Cadi Bp 417444 ■ 43.7984 288700 - 2&S900
tommy 252.731 - 252.936 15SAW - 155490
ho 4695.40 - 4884.00 30004)0 - 3000.00
tank OXSfiB - (L4S80 02601-02898
Poland 45747 . 45502 2*100 - 28120
Rusria 8880.74 - 880325 54S&00 - 546000
UAE 54704 - 54842 34710 - 34740
DOLLAR SPOT FORWARD AGAINST THE DOLLAR
Ctoetag Change BftWoGar
ima-poW on day apraad
Dqr% mid
Ntfi low
Om month Three months On* y«ar j.p Morgan
Rate %PA Ram %PA Rue %PA mam
CSch} 174386
(BFi) 50.7898
(DKi) 9/4637
(FM) 747B2
0=3=0 84182
( DM) 2X641
(DO 387471
(ffi) 14005
(U 248942
(LA) 50.7898
(R) 2761 6
(MO) 104814
tEa) 248486
(Pta) 207.580
tSKrJ 10.6897
(SFi) 24487
B
- 14844
- 1.122400
+0426 286
+04726 446
♦04205 087
+04162 713
+04087 153
+04037 827
+0436 862
+04032 994
-345 740
+04725 448
+0401 803
-04129 772
+0.163 954
+0427 489
-00012 789
+04102 487
485 174875
346 504070
676 04896
871 74970
211 84389
654 24719
280 389427
Oil 14016
105 247749
348 504070
628 2.7774
856 104095
239 248413
672 206402
004 10.7223
507 24527
174951
34
174356
24
-
1044
Areata
(Soft)
104475
+04416 441 - 511
104600
104280
104279
24
104876
24
10.3826
2.4
104.7
504848
34
504998
51
494048
51
1064
Balkan
(Bft)
31.1000
+0.12 700- 100
314100
314420
31.13
24
314026
2.4
30X825
24 1054
54437
24
94032
24
94242
55
1074
Denmark
(DKi)
54116
+04286 106 - 126
54179
54018
54027
14
5.780
14
5.7026
1.9
106.7
-
-
-
-
-
-
844
Finland
(FM)
44316
+04209 278-353
44360
44208
44228
24
44041
2 A
4X216
2.4
844
52992
57
84603
24
84818
58
1084
Franc*
JTf)
5. 1082
+00184 077-087
5.1127
54890
54898
24
54819
2.1
5.0062
24 1064
2458
34
54452
51
24888
51
1084
Germany
(DM)
14132
+04069 127 - 136
14150
14103
14103
24
14044
24
1X796
24
1074
-
-
-
-
•
-
67.7
Greece
(DO
237.700
+0465 890 - 770
238460
236430
238455
-74
241.825
-04
p+j-a w;
-6.4
67 X
1
04
0499
04
04824
04
994
kefand
09
14280
-04081 270 - 290
1.6380
14285
1.6275
04
14272
02
14243
04
.
247342
-14
?*pn *i?
-14
248542
-04
77.1
Italy
W
151645
+14 580 - 710
1517.63
1511.40
151942
-24
152345
-24
1539
-14
764
504648
34
51
494048
51
1084
Luxembourg
(LFr)
31.1800
+0.12 700-100
314100
314420
31.13
24
314025
2.4
30X825
24 1054
27544
51
57394
34
50747
51
1064
Motherlands
CR>
14850
+04047 955 - 962
1.7015
1.6945
14821
2.7
14841
24
14485
24
1054
104688
1 A
104489
14
104438
14
804
Norway
ONKr)
54752
+00075 742-782
84120
64705
64715
0.7
64858
04
84402
04
08.7
245291
-04
249461
-04
-
-
954
Portugal
(Era)
152470
+047 820-020
153.100
152430
153.175
-14
153X7
-14
154445
-04
964
207245
-14
207475
-04
207475
-04
804
Spain
(P»a)
127475
+0425 450-500
127.660
127.090
127465
-1.7
127415
-IX
12848
-04
794
104885
0.1
104850
0.1
104735
04
904
Sweden
(SKr)
84645
+04151 595 - 885
64738
64535
64617
04
64518
04
64045
04
894
24421
44
50271
4 A
14604
*A
1094
fTnillkanire ni
uWIUnmiu
(SFr)
14587
+04003 584 - 590
14605
14520
14549
3.7
1447
3.7
14142
34 1004
-
-
. -
-
-
-
904
UK
(9
14284
-0404 280 - 288
14340
14241
14274
0.7
14255
0.7
1.6144
04
894
12825
14
1478
50
14566
24
-
Ecu
-
14678
-04037 675 - 881
14688
14662
14082
-14
14723
-IX
14889
-1.7
•
WORLD INTEREST RATES
MONEY RATES
October 31 Over
nigra
run it would weaken the dol-
lar since it would make a US
interest rate increase less
likely.
■ Mr Kenneth Clarke, UK
chancellor, yesterday her-
alded the pound’s strong
rally since the summer as a
sign of growing interna-
tional confidence In the UK's
long-term economic pros-
pects.
But currency markets yes-
terday made a somewhat
sceptical reappraisal of
Wednesday’s quarter-point
increase in interest rates to 6
per cent The pound rallied
immediately after the move.
But it gyrated erratically
yesterday as traders
attempted to gauge whether
the rate increase was a pre-
emptive attack on inflation
or whether it in fact meant
Mr Clarke would now ease
fiscal policy.
• For the latest market
update, ring FT Cityline on
+44 990 209909
To subscribe. caB +44 171 873 4378
Belgium
week ago
France
week ago
Germany
week ego
One Three
month note
3u 3H
3 j 32
3i 34
3i 34
weak ago
SS
sc
SS
55
Italy
7*
7u
7JI
weak ago
7*1
k
71k
r;-
Ndharland*
2’a
3
Si
3 1 '*
weak ago
23
3
2S
2S
Bwteartand
14a
Ilk
12
IS
weak ago
ih
14h
13
Ii*
US
5Vk
B'li
sy
sy
week ago
Si
5'j
5H>
Japan
1L.
if
i,
u
3
week ago
a
3
i.
■ 3 LIBOR FT Lon
don
interbank Fbdng
SH
S'i
58
week ago
-
5h
Si-
SH
US Dallr CDs
648
507
5.13
week ago
_
5.03
5.10
5.19
ECU Linked Da
4&
4,1
4&
week ago
_
4>V
SDR Lfafced Da
_
St
*>:
3S
week bqo
-
St
Sri
31
Dim. Repo
rate
240 . -
240
- 4.75
- 4.75
240 340
240 3.00
- 645
- 645
740 648
7.50 B.38
340 340
3.00 340
140
1.00
5.00
500
040
0.50
S LSOR Intvttmk tiling ijm am oflenxl rates la SlOm Quoted Vo the market Ov tour
wte u f iie ranks ■ Hem cacti anrVtng day The Banka are. Bentara I run. Ban* of Tokyo
MtublaM. Barclays and National WKimnsw.
Md raw* ms shown tor Itw dumasuc Ur-nay FM*". USS CD*. ECU 4 SDR Unfed DrpaMa pa).
EURO CURRENCY INTEREST RATES
Oct 31 Short 7 days One Three Six On*
term notice month montha montha year
Belgian Franc 3*a - 3* - 2» 3* - 3 3& - 3ft 3,1 - 3ft 3* - 3ft
Oaneh Krone 3ft . 3I4 3ft - 3ft 3ft - 3ij 3(1 - 3,1 3|i - 3ft 3|J - 3k
D-Mark 3,1 ■ 2»J 3l* - 3 31* 3 3,1 - 3,1 3,1 - 3,1 3,1 ■ 3,1
Dutch Gutter 3,1 - 2(1 3-2% 2*41 - 3ft - 2il 3ft - 3ft 34a ■ 3*
Franch Franc 3% - 3I4 31* - 3L, 3ft - 3,1 3,1 -3ft 3ft - 311 30 - 3A
Portuguese Esc. 7l» - 7,1 7,1 - 6(2 7 - fig CtJ - 6j* 6(1 - 8ft 4) - «U
Sparest) Peseta 7 - 6* 7-67* &SJ - 61 6% - 61 61-6% 6fi - 0ft
Startng 6% - 6 6,1 • 6,1 BA - 6,1 6,1 O 1 * 63* - 6,1 B*« - 6,1
Sun Franc 1*» - H 2 i(i - l£ ifi - 1,1 i« - Hi HI - 1ft HI - 111
Can. Dollar 3H - 3,1 3ft - 3,1 3ft -3k 3|| - 3* 3,1 - 3,1 31 - 3>*
US COCar 5ft - SX 5,1 - 5,1 5% - 5,1 5b - 5b 51! - 5ft 5ft • 5ft
Itafcan Lae 7ft - 7fl 7ft - 7ft 7(i -7ft 7** - 7lj 7ft - 7,1 7* - 5ft
Van ft - A h - B B - B ft - ft la - ii ft - B
Aaian SSrtg 33* - 3** 33, -31 3b - 3>+ 33* - 31 3,1 - 3,1 3>2 - 33*
Short term rata* are call lor ttrs US Dollar and Van. Ottawa l«o day*' nowca
■ THREE MONTH PfflOR FUTURE* (MATIFIPaiti Intarbank offered rat* (FFr 5m)
33,-211 3^.-2?J
3U-3U 3B-3JI 3
3ft - 2« 3*a - 3
3,1 - 2(1 3-2% 2
33* - 3I4 3% - 31 3
7l* - 7ft 7ft - 6lJ
7-61 7-67* E
64 - 6 6,1 • 6,1 E
1*8 - 1*2 1ft - 1ft 1
34 - 3ft 313 - 3,1 3
5(2 - 5ft 5ft -5.1 5
7ft - 7ft 7il - 7ft 7
ft - ft h - B
34-34 34-34 3
re call lor ms US Dollar an
(TH POOR FUTURES
Argentina (Peac^ 14202 -04042 277 - 286 14340 1.6246 - - - -
BrazB (RS) 1.6730 -04044 724 - 736 14788 14694 - - - - -
Canada (C$) 2.1638 -04056 628 - 847 2.1909 2.1775 2.1787 24 2.1678 24 2.1088 34 884
Mamco (New Paso) 13.1240 +0.115 054-444 13.1502 134172 - - - - -
USA j$) 14284 -0.004 280 - 288 14340 14241 14274 CL7 14255 0.7 1.6144 04 97.1
PadHc/MkkBa Ematf Africa
Argentina (Paeo) 04999 -04001 998
Braal (RSJ 14274 -04002 273 '
Canada (CS) 14411 -04002 408 -
Mexico (New Paao} 84600 +040 500
USA (9
999 04999 04998
275 14278 14271
Australia
(AS)
24534
-04081 522 - 545
24831
24484
24647
-04
24554
-OX
2455
-0.1
94.1
Hong Kong -
(HKD
124913
-043 874 - 952
12.6339
12484
0.7
124701
0.7
124056
07
-
India
<Rs)
574711
-04745 940 -482
564860
574600
- •
-
-
-
-
-
-
Israel
(Shk)
54320
-04008 240-400
54410
54001
re
.
-
-
-
-
-
Japan
(Y)
185414
-0478 067 - 341
106530
184.180
184424
54
132X64
54
174X34
54
1274
Malaysia
(MD
4.1144
-04114 128 - 160
4.1361
44995
-
re
-
-
-
-
-
New Zealand
(NZD
24021
-041 OB 004 - 038
24151
24975
24068
-35
24182
-24
2439
-1.8
1114
PhHppines (Praoj 42.7944 -0.112 187 - 700 424760 42.7182
Saud Arabia (SR) 6.1073 -04148 055-091 6.1262 64915
Stngepore (SS) 24944 -0404 932 - B55 24017 24901
South Africa (T9 7.6421 -04981 381 -480 7.7824 7.6354
South Korea (Won) 1346.77 -9.14 603-751 135642 134342
Taiwan (15) 44446Z -0.1088 026 - 897 444677 44.7602
Thailand (Bt) 414324 -04863 140-507 414860 414390
AustreBa (AS) 14610 -04019 606
Hong Kong (l-KS) 74323 +04003 318
Indta (Hs) 354000 -0482 000
Israel {SN4 34744 +04075 703
Japan (V) 113.740 -0.14 690
Malaysia (MS) 24267 -04006 263
NewZMand (NZS) 1.4137 -04032 130
PhBppktw (Paso) 262800 -0405 400
Saucfi Arabia (SR) 3.7505 - 503
- 785 32788 32607
-200 264200 282400
Saud Arabia (SR) 3.7505
Sfrigapore (SS) 1^090 +0401 066
South Africa (R) 44930 -04475 905
South Korea [Wor^ 827450 -3.6 800
Ttlwan (TQ 274400 - 200
ThaBand (Bt) 254050 +0407 000
T son me per S fonOol 30. OUUflar awda Ki I
aaad le the market but ere fenpled By awiaM In)
sa Bwm mngt 1090-100.
t Rales tor Oct 30 OttWtor spread* b 81* Pored Spot abtodwworty the tat Hass doM piacaa. Fcreaid rate* me not «Botly quotsd totfw mariat bw
ara invCad By craant kWrew mob. SlerfW krxk* cWcuWtnd by tht Hark a I B^tond Bmm awoua 1B0O - 100. Ma isbaaad ifflBS. EBd Otar and
Mtt+daa in both iWa and kw Dob Spot tatWs darired kern THE WkMEUTBlS CL08MS SPOT RATES. Soma nakaa are lOundad by Bw F.T.
14387
21
14337
24
15062
24
885
8.178
-174
8X445
-19.1
9505
-15X
.
-
-
-
-
-
■
974
14625
-IX
14644
-1.1
14699
-07
964
7.7322
04
7.7328
04
7.7438
-0.1
-
35415
-74
38475
-7.6
-
-
-
113465
5.0
11248
54
10848
64 1274
24295
-IX
24349
-15
25682
-14
-
1X192
-4.7
1X235
-28
1X55
-44
-
3.7508
-0.1
3.7512
-0.1
3.7531
-0.1
.
1X068
14
1X022
14
1581
24
.
47337
-10X
44087
-04
5.1235
-84
-
Open
Sen price Change
High
Law
Eat vol Open M.
Dec
96.46
96X7
+0 03
96.49
96 45
19.097
51.842
Mar
96.40
96.40
+0.02
96.43
96.38
13,094
51597
Jun
96.33
96.33
+0.01
9656
96 33
4.558
29.705
■ THRU MOWTH EUROMARK FUTUflKS (UFTEV DM 1m prenta of 100%
Open
Sett price Change
High
Low
Est vol
Open mL
Dec
9679
96.79
-
96.80
96 79
17068
216711
Mre
96.78
96.77
+0.01
96.79
96 76
23196
191237
Jtn
96.59
96.59
+0.01
96.62
96.57
23690
187210
Sep
9657
9656
-
96X0
96.34
27083
153499
■ THREE HO NTH EUROURA FUTURES (LIFFEl* LlOOOm points Of 100%
Open
Sett price Change
High
LOW
Eat vol
Open m.
Dec
92.61
9248
+0.08
82.67
82-80
14S61
71027
Mar
93.13
93.18
+047
93.23
93.12
14005
54704
Jun
93.40
93.42
+0.07
93.45
93 39
3215
32894
Sap
93.44
83.47
+0.07
93.51
93X4
2636
22778
L taOltnt EURO SWISS raARCWTURBSftJFPE)SFrtwpol«aoSTOini,
-300 830400 826.700 - -
-600 27.5700 274200 274401 04 274403
- 100 254510 254960 25495 -42 252625
it* Oder Spot table Aow only the tat ihree dsdrrol ptao
lareet rates. UK. htand 3 ECU ara i*aMad In US cwisncy.
04 ...
-4.0 264 -34 -
re. Forward non we no, dracUy
OP. Morgan nominal baflesa Oct
Open
Sett price Change
High
LOW
Est vol Open kit
Dee
98.12
98.18
+0.01
98.16
98-08
4327
30077
Mar
96.11
98.14
+0.01
98.17
98.06
5818
3022B
Jiai
9749
B7.95
+0.01
9748
97.88
1432
15684
Sap
97.67
07.72
~
97.76
87.87
358
5266
■ THREE MONTH EUROYEN FUTURES (UFFE) YlOOm paints of 100%
Open
Sett price Change
High
Lew
Ess. vol
Open kit.
Dee
99.45
99X5
-
99.45
99X5
80
0
Mar
9959
8959
-0.01
8959
99.39
50
0
Jin
99-28
9958
-0.02
9948
994B
145
0
■ THREE MONTH ECU FUTURES (UFFE) Eeulm points of 100%
Open
Sett price
Change
High
Low
Est. vol
Open inL
Dec
9540
9542
+0.03
9543
9580
1232
7913
Mar
9544
95.82
+042
9544
9542
285
5307
Jun
95.79
95.78
+0.01
95.80
95.79
205
3641
Sap
9648
95.66
-
6548
95.65
439
2633
* UFFE futures also tredao on APT
CROSS RATES AND DERIVATIVES
EXCHANGE CROSS RATES
Oct 31 , BFf DKr FFr
Bdfriuni .
Dwtmaric
Banoa .
Germany
lila nd -
itmy
Norway
Portugal
Spain
Samian
Saittarland
UK
Canada
us
Japan '
Ecu
DonUl Kroner.
(BFr) 100. 1843 1848 44 J
(OKI) 5847 10 5789 2.«
(Ffi) 51.08 1148 10 2JK
(DM) 20.61 3441 3-378 1
(IE) 40.79 9.464 5318 2.41
(L) 2.057 0483 0437 511
fpi 1539 5427 3412 041
(NKl) 4593 8.118 5013 24)
{&) 2049 5799 5339 0.91
(Pin) 24,47 4458 4407 1.11
(SKr) 4741 8.853 7.781 24(
(SFr) 24.78 4417 4.058 141
(E) 50.79 9464 531B 2M
(CS) 2526 4.333 5B09 1.1!
3140 5813 4109 14‘
(Y) 27,42 5.110 4.481-14!
39.56 7471 547B 14
Franch Fnmo. Norwagton Kroner, and tarad
FtfTUMS (IMM) DM 125400 per DM
1469
1457
1402
5406
1 ••
0041
0462
0463
0401
0482
0435
0488
1400
0458
0414
0440-
0.779
Kronor par ■
R
NKr
Ea
5X38
20.44
4804
2.918
1047
2834
3521
12X8
2994
1.121
4413
101.1
2.762
10.38 •
248.1
0.112
0X20
1049
1
3.756
90.19
2461
10
240.0
1.109
4.167
100.
1530
5400
1204
2.584
9.710
2334
1547
5483
1214
2.782
1058
249.1
1465
4.753
114.1
1487
8578
153.0
1X81
5.605
1344
2.151 5084
m Franc, Yen. Eat
Pta
SKr
SFk
C
CS
s
Y
Ecu
408.7
2145
4.036
1489
4500
3405
3845
2528
219.4 .
1150
2.168
1457
2508
1.720
195.7
1557
2494
1245
2X65
1402
2.626
1457
9»«
1544
8445
4538
0532
0X06
0586
0561
75.16
0521
2074
10.68
2.050
1400
2.184
1528
1854
1484
8X08
0X33
0483
0441
aces
0466
7501
0452
76.16
3570
0.742
0.362
a79i
0586
6745
0X85
2004
1050
1475
0463
2.104
1588
178X
1437
8354
4491
0523
0X01
0577
0.664
7455
0.515
100.
5.149
0487
0X82
1452
0.7B4
8941
0518
1944
10
1418
0435
2443
1523
1732
1401
1015
5415
1
0X88
1485
0.794
9054
0.626
2075
1049
2.050
1
2.184
1528
1854
1484
9545
4595
0438
0X58
1
0.745
8450
0588
127.5
6588.
1569
0414
1542
1
1135
0.7B9
112.1
6.772
1.107
0540
1.178
0579
100.
0693
181.7
6526
1597
0.779
1.701
1468
1444
1
Union wihmI
m 24 HRS _
Contact Ehtncan Dtum H
Hfl j 0171 329 3030 Faxi 0171 329 0545 ^J.
L imi ten lntgraet ; http^/www.tg]ctm:com/nugjtatt/cair
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OPTIONS
& FOREX
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TEL: 0171 629 J 133 FAX; 0J71 495 0022
Open
Laiast
Change High
Low
Est vol
Open InL
Open
Latere
Change
08637
05822
-00017 05637
OB619
25.116
57541
Dec
08824
08832
+04002
- 0.6679
05662
-04015 -05679
05658
238
3,743
Mar
05963
- 05843
—
Jun
0.6700
-04016
08700
3
2530
Jun
09075
09069
+00012
1 FRANC FUTURES (IMM) SFr 125.000 pra SFr
08011
08003
-04003
05017
07976
1655*
42538
08073
05074
' -04004
08074
05074
162
2.707
05140
-00011
-
05140
B
806
INTEREST RATES
(IMM) Yen 12.5 per Yen 100
Change Hgh Low Eat. vol Open InL
+04002 04882 04810 18403 76489
04963 04943 622 5122
■ sratuNQ runmn qmm) 8 82400 pare
Dec 1.6324 14250 -04072 14328 1.6228 17414 07443
Mar 14240 1.6230 -04068 14240 14220 374 665
Jin - 1.6190 -04078 - 14180 100 162
ERRS EUROPEAN CURRENCY UNIT RATES
Affdrc!.ib:e 'eal time L-qui-re?.. futures, options ancf noivs.
Market-Eye
FREEPHONE 0800 321 321 FAX 0171 398 1001
liLkLfil :< J 1 i- f j n ■ . 1 n 4 1 IrAl
FOA COMPLETE REAL-TIME DAIA OF THE US
AND EUROPEAN EXCHANGES
KNEHT-RIDDER’S FUTURES MARKET 0ATAKIT FROM $570
ri | j ||| MMIU fM d ta| pH* niibi O DataaUDbMrgraaN hd. *■
Interbank Stortng
Stflrfng CDS
Treaouiy B«a
Bank BOt
81; 3 8,1 -6 6ft - 6 8ft - 51 - 6j» 6ft - 6ft
8ft - B 6»# - 8ft Bft - 61* 6ft - BU
- KfS-51? 58-511 - - -
an -5% 8-511 eft-eft - ,
Local authority depo. Bi* - 6 6 - 5% 6ft - 6 - 6ft 6ft - 6ft 6ft - M
O&wxrit Market deps 6l» - 6># - 8 - - .
uK dearing bank base landing rata 6 per cent from. October 35 19B6_
Up to 1 1-3 3-6 6-9 9-12
month month montha montha montha
Oct 91
Ecu can.
rates
Rata
against Ecu
Change
on day
Ireland
0792214
0,781208
+0.001824
I HRMIII
5.80661
5.76963
+0.00625
Portugal
195.792
194538
+0067
Spare*
162X93
162542
-042
PMfftwtands
2.15214
2-15989
+000063
Belgium
395060
99.6941
+04382
Oermany.
141007
142681
+040174
Austria
13X383
135563
+00123
Franca
040606
650246
-040881
DaremreV. 748580
NON ERM MEMBERS
759638
-040148
Orea o*
292567
302.667
+0472
Italy
2106.15
192953
-7.1
UK
0786652
0782167
+0400921
PWcmBadianareaialerEacapoaBradiaogadBnoiaaaa
botamn n» renadai ew panwo^ cMerem breweai riw at
245
9
2.17
4
241
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Mi Mtar MU. 71 RMlttMi LaMM EHT 1KM+44 «17l Stt4M3
\\ ANT TO KNOW A SI C RI 1 ?
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26
FINANCIAL TIMES FRfDAY NOVEMBER 1 1996
★
COMMODITIES AND AGRICULTURE
Sumitomo copper affair prompts watchdog summit
By Laurie Morse in Chicago
The world's three most powerful
commodity futures market watch-
dogs have organised a s ummi t to
discuss special concerns about
global commodity market regula-
tion in the wake of the Sumitomo
copper scandal.
Officials from IS countries,
including China, have been
Invited to attend the conference.
to be held In London at the end of
November. They will examine
ways of avoiding manipulation of
physical markets for internation-
ally-traded commodities such as
copper, oil and sugar.
Many of the countries invited,
including several in Europe, are
considering the introduction of
commodity futures contracts. One
regulatory official said the prolif-
eration of new physicals markets
made the summit “a unique
opportunity for officials from
jurisdictions that have fully-devel-
oped commodity markets to share
their experience with officials
who are just beginning to deal
with physical commodities".
The UK's Securities and Invest-
ments Board, Japan's Ministry of
Trade and Industry CMiti) and the
Commodity Futures Trading Com-
mission of the US are sponsoring
the meeting. While much work
has been done on cross-border
co-operation by regulators for the
fast-growing arena of financial
derivatives, it Is rare for regula-
tors to confer specifically on com-
modities market oversight.
M s Br ooksely Bora, who heads
the CFTC. said that the examina-
tion could be overdue. While
international commodities con-
tracts have been traded for centu-
ries, there were now greater
opportunities for manipulation of
the markets.
“Better global communications,
and the increased ability of mar-
ket participants to move quickly
from jurisdiction to jurisdiction
and to trade simultaneously from
around the globe have created
greater global opportunities for
commodity futures market manip-
ulation.'’ she said.
Issues of contract design and
availability and transparency
of deliverable supplies are
expected to top the agenda for the
meeting.
The Sumitomo affair demon-
strated the evolution of markets.
Mr Yasuhlro Hamanaka. Sumi-
tomo’s chief metals trader, ran up
huge losses In unauthorised cop-
per trades, casting the trading
house an estimated $ 2 . 6 bn.
Brazil’s coffee industry
gains influential voice
By Jonathan Wheatley
in Sao Paulo
Brazil's new coffee policy
council will nil a void in
policy-making and allow the
development of coherent pol-
icies for the first time since
1990. industry observers say.
The CDPC, created by
presidential decree on Tues-
day. gives the Industry some
influence over policy-making
- something it has long
demanded - and should help
end years of incoherence
over market policy.
The government hopes the
CDPC will help raise produc-
tion from about 23m 60kg
bags a year to between 30m
and 35m bags a year over the
next decade.
The council, comprising
six government and six pri-
vate-sector members, is the
first policy body set up since
1990 when the Brazilian Cof-
fee Institute was swept away
in a wave of restructuring
under Mr Fernando Collor.
then president
“What's really important
Is that the council gives the
industry and government a
united voice," says Mr Law-
rence Eagles, a coffee ana-
lyst at GNI Research In Rio
de Janeiro. “It will make
Brazil stronger and more
able to reflect its weight in
the world market Up to now
there has been an embar-
rassing lack of policy and
Brazil's delegation to the
[Association of Coffee Produ-
cing Countries] has been
unable to implement inter-
national agreements."
The remit of the CDPC is
to co-ordinate coffee auc-
tions to balance supply and
demand on domestic and
export markets: determine
policy for warehousing and
sale of the 4.2m bags held by
the government and 9~2m
bags held by a coffee devel-
opment fund, Funcafc; set
Funcafe's budget (the fund
controls 5847m. including
$ 620 m committed to invest-
ments in production!: co-or-
dinate links between govern-
ment, the private sector and
international bodies;
approve crop plans and
mechanisms for crop esti-
mates; and co-ordinate agri-
cultural and market
research.
The council will meet
every two months under the
chairmanship of Mr Fran-
cisco Dornelles. the trade
and industry minis ter, who
will have a casting vote. Mr
Dornelles retains the right to
take unilateral policy deci-
sions, although observers
say he is unlikely to do so.
Mr Francisco Ourlque, a
coffee broker who helped
develop the council, said it
would help the industry
meet demand for between
25m and 27m bags during
1996-97. Estimated output for
the year is about 1.5m bags
short of that target.
Tefcwti Colour Ltaary
CDPC should help Brazil meet future production targets
Prices slip on Liffe despite continuing tightness of supplies
Coffee prices eased yesterday after a
choppy week of trading, but ana-
lysts say supplies remain tight and
predict that continued strong buy-
ing interest from US and European
roasters could push the market
higher again over the longer term,
Deborah Hargreaves writes.
January coffee futures prices lost
$7 a tonne on the London Interna-
tional Financial Futures and
Options Exchange to SI, 380, with
New York futures mixed in light
trading.
GNI, the London brokers, said
concerns over a possible delay to
the Vietnamese coffee harvest
because of heavy rains could lend
some support to prices.
“The supply situation remains
tight and I don't expect it to ease
before December," said Ms Jody
Ganes, soft commodities analyst at
Merrill Lynch in New York.
Nevertheless, African producers,
who are holding their annual meet-
ing on November 17, said they
remained concerned about low cof-
fee prices in spite of an agreement
in place to limi t exports.
Meanwhile, Mr Celsius Lodder.
head of the Internationa) Coffee
Organisation, the producers and
consumers body, predicted sharp
growth in risk management Instru-
ments in the market which would
have a key influence on prices.
Speaking in Bogota, he said the
move among consumers to carry
lower stocks would make it more
important for exporters, traders and
processors to resort to sophisticated
financial mechanisms to offset price
volatility.
New challenge
for US wheat
MARKETS REPORT
By Laurie Morse In Chicago
and Deborah Hargreaves
in London
US wheat futures prices
continued their slide yester-
day, as traders anticipated
ample new supplies from
southern hemisphere har-
vests and fears about the
karnal bunt fungus
re-emerged.
Wheat prices for December
delivery tumbled 8 cents, to
53.73 a bushel in mid-morn-
ing trading at the Chicago
Board of Trade - a 40 per
cent drop from the contract
high and the lowest price the
contract has reached in 17
months.
Wheat contracts for deliv-
ery later in 1997, closer to
the next US wheat harvest,
established all-time lows.
“People are concerned
about big harvests in Argen-
tina and Australia, and are
also worried that the US and
[European Union] will
resume their wheat subsidy
battle," said Mr Jerry Gidel.
of Dean Witter Reynolds.
Traders said the market
continued to be hit by
reports of wheat exports
being rejected due to karnal
bunt and other funguses.
Maize futures prices also
tumbled in Chicago. Traders
said the market expected the
US Department of Agricul-
ture to boost its US maize
production estimate, cur-
rently at 9.01bn bushels, in
its crop report, due to be
published on November 12.
December maize was trading
at $3.67 at midday, down 3
cents a bushel and its lowest
level since August 1995.
Crude oil prices slipped in
late London trading follow-
ing the announcement of a
Kurdish ceasefire with Iraq.
Traders interpreted this as
bearish news for the oil mar-
ket as it could bring Iraqi oil
back to the market sooner.
North Sea Brent crude for
December delivery lost
17 cents, dropping to $23.40 a
barrel. The market had been
much higher at $23.92 earlier
in the day. December fixtures
at the New York Mercantile
Exchange broke through a
key support level of $23.85 a
barreL
The market had been
stronger in early trading on
the back of a rise in heating
oil prices with a cold snap
forecast for the north-east-
era part of the US. where
many households use oil for
heating. The price slipped
back in later trading to
hover around its previous
dose of 68.86 cents a gallon.
December white sugar
futures on Liffe lost almost
$3 a tonne to tumble through
a key support point at $310 a
tonne. Traders said the mar-
ket was looking extremely
weak as prices continued
their “bear" run.
Singapore
launches
rubber
reforms
By James Kynge
in Kuala Lumpur
The Singapore Commodity
Exchange launches changes
in Its main rubber contract
today in an attempt to boost
volume in a market which
has been In the doldrums for
weeks. Sicom hopes the
reforms will international-
ise trading and maintain its
position as south-east Asia's
premier exchange.
The main reform is the
launch of an “FOB" - free
cm board - futures contract
which will not demand the
rigorous testing of rubber
required under the current
"award” contract.
The new contract will be
denominated in US dollars
as opposed to Singapore dol-
lars. Because the physical
trade is conducted in US dol-
lars, this should eliminate
currency risk and make it
easier to hedge - reducing
risk by taking a position
which offsets existing expo-
sure to market rate changes.
Rubber will no longer
have to be shipped to
approved Singapore ware-
houses or undergo the man-
datory tests of the award
system. Singapore ware-
houses are often more
expensive thaw others in the
region and the tests, which
involve 20 different inspec-
tions, tend to prolong ware-
housing time.
Singapore is keenly aware
that it must reform ahead of
possible competition from
Indonesia - which some
analysts say may start trad-
ing rubber futures by the
middle of next year.
The TSR20 (FOB) contract
will be for the October/
December 1997 contract
months.
The TSR20 (award) con-
tracts will continue to be
traded until the July/Sep-
tember 1997 contract
months.
COMMODITIES PRICES
BASE METALS
Precious Metals continued GRAINS AND OIL SEEDS SOFTS
MEAT AND LIVESTOCK
LONDON METAL EXCHANGE
(Prices from Amalgamated Metal Trading}
■ ALU MOIIU M, 89.7 purity (S per lonne)
Grail
3 fifths
Close
1416-7
1443-4
Previous
1395-96
1423-24
High/low
1455/1429
AM Official
1415-6
1442-3
Kerb close
1436-7
Open ml
231.014
Total duty tunowr
66.231
■ ALUMINIUM ALLOY (S par tonne)
Close
1262-7
1288-90
Previous
1255-65
1280-90
Wgh/tow
1293/1287
AM Official
1260-65
1287-90
Kerb close
1285-90
Open irit
6.387
Tola* daily turnover
705
■ LEAD CS per tonne)
Close
754.5-5.5
756-7
Previous
733.5-4.5
740-1
HtgMaw
758/747
AM Official
750-2
756-7
Kerb dose
752-3
Open Irrt.
40,323
Total dsty turnover
9.984
■ NICKEL (5 per too no)
Close
7230-7240
7340-15
Previous
7220-30
7330-35
Higtvlow
7415/7330
AM Official
7230-40
7340-45
Kerb dose
7330-35
Open ML
46,138
Total cUnly turnover
13,154
■ TIN (S per lonne)
Close
5915-25
5980-90
Previous
5915-25
5980-90
HigtYkNv
5950/5944
6010/5980
AM Official
5945-50
6000-05
Kerb close
5985-90
Open mi.
15.328
Total o.hm remover
2.700
ifi
I
1
!
■
per tonne)
Close
1046-7
1066-7
Previous,
1023 5-24.5
1046-47
High-low
1070/1057
AM Official
1043-5 5
1066 5-7.0
Kerb close
1066-67
Open ini.
77.028
Total duty remover
47.305
■ COPPER, grade A (5 per Torino)
Close
2003.5-5.5
1669-70
Previous
1970-72
1940-42
Higtvlow
2008.2006
1984/1937
AM Official
2007.5-8 5
1965-7
Kero close
1957-8
Open mL
173.609
Total tt«fy remover
73.467
■ LME AM Official C/S note: 1.628S
LME doing C/S rate; 1-B277
Spct 1 6L‘S 3 mfler I C47 G mflis I £2! 4 n*er 1.6166
■ HIGH GRADE COPPER (GOMEX)
Sett
Daya
Open
price
cfcnyv
man
LOW
Vol
lot
*0*
9250
-1 40
93.90
9200
698
2.891
Dee
9130
-150
93.60
90.00 10 070 23291
Jn
90.50
-1 10
92 05
91.70
193
1.873
Feb
89 85
-i as
91 40
8850
21
934
Mar
SB 95
-1.05
91.10
8780
3,036
12.045
Apr
Total
8810
--.40
-
11 542
74/498 58,763
PRECIOUS METALS
■ LONDON BULLION MARKET
(Puces supplied by N M Rothschild)
GofttfTray oti S price C squiv SFr equh#
dose 3r9.saoao.oo
Opening J79 50-3, '9.00
Morning fix 379.30 733 128 476J25
Afternoon fix 379.50 233.223 .176.768
Day ’3 High 378.70-379.10
Day’s Low 380.10-380 50
Picwm cine 380.00-300 JQ
■ GOLD COMEX (100 Troy OZ4 S/taoy Og.)
SMt
Day's
Open
price change Hfgh
low
vu ut
Ifa*
378.1
-il
_
_
_ _
Doe
379.1
-22
381.9
377.7 19,920 90,522
Fob
391.1
-2.3
383.4
380.5
862 17250
Apr
3882
+2.7
3852
3828
1.246 11.778
Jon
385.5
-23
387.7
385.0
52 11291
A m
367.8
-2.3
3887
388.7
37 4284
Total
23209188225
■ PLATINUM NYMEX (50 Tray OLf S/troy az.)
Jap
3842
-14
3852
3832
2209 19296
Apr
386.6
-1.4
3B8.0
386.0
653 8.125
Jri
389.fi
-1.4
380.0
3892
11 972
Dei
3929
-1.4
3840
3840
11 136
Total
3,177 28229
■ PALLADIUM NYMEX (100 Tray as,- S/troy cot.)
Dae
118.75
-0.75 117.75 116.50
662 7264
Mar
11725
-0.75
-
-
2 451
Jim
118.90
-0.75
-
-
- 116
Total
692 8,131
■ SILVER COMEX (5.000 Tray k.; Cano/troy ax.)
No*
478.8
-12
4820
4820
17 17
Dm
4808
-2.0
4880
476.0 11 294 64.187
Jm
482.8
-2.0
-
-
28
Mar
487.6
-2.1
4840
483.0
712 13.750
May
491 9
-21
493 0
489.0
5« 6.618
JM
4983
-21
5025
495.0
144 5.166
Total
12200 962«
ENERGY
■ CRUDE OIL NYMEX (1.000 ban ate- S/banrefl
Latest Day's
Open
pries change High
1 MM
Vol bit
Dec
23.45 -023 24.80
2320 43.753 94.729
Jan
23.15 -0.74 24.20
22.95
21.204 53.052
Feb
22.72 -0 74 23 75
22 60
7,391 35.722
Mar
2228 -0 74 2125
22-20
4.207 22398
An
2190 -069 2277
21.90
2,357 16.150
■it
21.70 -0 49 2231
21.70
992 11.155
Total
87,312 M1.I7B
■ CRUDE OIL IPE (S/barrel)
Latoat Day's
Open
price change Ugh
LOW
Vet tot
Dee
22.90 -0 67 23 92
22.90
13.934 88.711
Jan
22.51 -0.66 23.43
22.50
9.326 43,508
Ffeb
21.90 -0.75 2260
21 90
3J73 24J55
Mar
21.55 -0.54 2222
21.55
664 26595
Apr
21.02 -0 52 21 65
21.02
1.761 (LB 96
May
20 73 -027 20 73
20 73
20 4.274
Trial
■ HEATING OIL NYUB (42.000 US gate. C/US gab)
Latest Oar's
Open
price ctuhitffl lUyli
lum
Vol bit
Nov
66.50 -1 93 69 80
66 25 19.226 3.892
Dae
66 95 -1.91 7U20
68 60
27.113 40.606
Jan
86.90 -1.91 69 *
6460 10-268 30295
Fob
65 70 -1.96 68 55
65.60
4J7S 15576
Mar
03.00 -2.36 66 20
63 00
2.399 8.681
Apr
fit 50 -041 6250
81.50
592 5J229
Total
84045 129A0S
■ GAS OIL PE (S/tome)
Sell Days
0 pm
price change High
Low
VW tat
Nov
21900 -1 75 221.00 21800
8.556 29J2B9
Dee
21430 *0 75 21600 21325
5.635 24.887
Jan
21650 - 213.00 210.00
2.154 19.861
Fob
20525 -050 207 25 205.25
451 6.696
Mar
198.50 -0J50 200 50
198.75
587 5524
Apr
191 75 -03b 194.00 192.00
124 4.422
Trial
21,291 102^85
■ NATURAL GAS IIYUSt 110.000 nwfti.: SflliinBa.1
Latest Darya
Open
price change High
low
Vol M
Dee
2 795 -a 069 2380
2.765 22.036 40.689
Jan
2.770 -0.058 2 840
2.740
7.619 2MJ17
Fab
2.510 -0363 2.575
2.495
2,246 13.822
Mar
2.330 -0040 2-300
2.325
850 9,628
Apr
2.155-0020 2.173
2.135
696 5.702
May
2.060 -0.030 2.030
2053
177 4.686
Total
3&Z7414UB0
Loco Ldn Moan Gold Lendhtg Rate* (Vs USS)
■ UNLEADED GASOLINE
NYMDl (43.000 US gate.. CAS gafc.)
2 months
3 months
. 3.15 12 months J.4B
..3.17
Latoat Days
pries change
Mgb
Low
vol
Open
lot
Sfver Fix
O-Troy OS.
US etc equiv.
Mm
67.00
-3.00
70 90
97.00
15313
0,883
SfXJt
296 10
482.50
doc
64 50
-2.43
67 80
6435
14.462
27,114
3 months
. 300.30
488.40
Jan
6100
-2.13
65 90
62.90
4.562
13.013
6 monltw
304.45
494.40
Feb
62J0
-1.68
62.80
8«8
4 647
1 year
313.55
506.70
Mar
63.50
-1 IB
65.40
6X50
234
1337
Gold Coins
Krugerrand
Maple Leaf
New Scworeign
S price
381-384
3S4.BO-387J5
B9-92
£ coutv.
234-236
55-57
Apr
Total
6630
6635
66 25
352
35331
2.516
E6£I4
■ WHEAT UFFE (£ per tonne)
Salt
Day's • •
Open
price change MR Lear
Vol
tat
Nov
95.25
-TJX) 9600 9550
25
Itt
Jan
97.15
-0.85 07.95 07.00
61
2,197
Mar
98.40
-08S 9900 9835
261
1865
May
99.55
-0.96 100.25 09.40
188
1,575
JM
101.00
-125 102.00 10125
45
286
HOv
96 75
-025 98.00 9800
5
143
Total
800
<L&7
■ WHEAT CUT (S.OOObu mbi; csxTts/BOfc bushef)
Dec
371.25
-875 38050 37800
6,339 31594
Mar
368J0
-650 37450 387.00
2.396
16859
May
358.50
-1.75 36380 35750
455
2236
JuJ
34850
-4.00 35250 34780
815
10292
Sap
351.50
-350 35680 35180
8
265
Doc
359.00
-1.00 36550 36480
24
175
Trial
18006
61 805
■ MAIZE CST (5,000 bu nsn; cent3/S6K> bushel)
Dae
206.00
-425 270.00 265.50 45240138.063
Mar
272.50
-425 27850 27200 17265 90249
May
279.00
-450 28380 2785D
8636 42281
Jri
283 JO
-150 28850 28325 10876
33,400
Sap
27900
-3 00 28100 278.50
351
3528
Doc
27850
-300 28080 27875
3292 27.363
Tata)
96,192 336592
■ BARLEY UFFE (£ per tonne)
be*
9150
-0.50 9250 91.75
28
329
Jan
93ZS
-0 50 33.75 9350
43
773
Mar
94.75
-050
-
196
May
96.00
-0.50 9625 96.25
60
98
Sep
91.50
-0.50
-
1
Trial
129
1522
■ SOYABEANS CBT (S.OGCbu mdc canblBOb haheS
Ho*
667.75 •
-21.75 66800 66680 31821
26536
Jn
669.00
-21.75 69050 66780 37.739
65,362
Mar
67X50 -24 00 695 50 672.00
7.477
31567
May
678 00
-22.50 700 50 677.00
2.995
18743
Jul
682.50
-20.75 701.50 68280
3909
15.129
Aug
679 50
-20 50 696 00 67800
65
1581
Total
85224 188581
■ SOYABEAN OIL C8T (60,0001 tec centn/tt)
Dec
22.59
-055
22.94
2258
7,071
49.158
Jan
22.86
-0.36
2320
22.88
2.795
18903
Mar
2324
-0.35
2359
2355
1507
17575
May
2359
-055
23 90
23.60
1.291
9.B89
Jul
2392
-0.35
2420
23S4
925
4.451
Aog
2395
-055
2450
24.05
113
1544
Total
13535 103443
■ SOYABEAN MEAL CBT (100 tons; S/Ion]
DOC
219.5
-7.1
228.6
219.1
12.423
39546
Jan
214.7
-7.7
221.7
215.0
3.685
11520
Mar
2110
-7.9
2184
210.6
3,033
18.313
May
200 a
-7.9
2162
209.5
1262
9589
Jul
2091
-7.4
216.0
209.0
727
5,653
itag
208.3
-82
2145
210.0
137
1540
Total
21506
88574
■ POTATOES UFFE (C/lomel
Nov
325
-
-
-
-
2
Mar
68.0
■*0 5
—
-
—
—
Apr
70.0
-05
«9.6
680
33
1.319
May
79.0
-0.5
-
-
-
17
Jun
690
*0.5
-
-
-
-
TDM
23
1538
■ FREIGHT (81FFEX) UFFE (SI (Wntfex point)
Od
1282
-1
1280
1280
3
714
Ho*
1360
*22
1363
1349
49
580
Dec
1310
*22
1318
1298
86
4S7
Jan
1289
+26
1300
1270
66
1.885
Apr
1306
+18
1310
1305
18
661
Jnl
113)
+11
-
-
_
196
Trial
Dose
Piw
224
4AM
8R
1311
1298
FUTURES DATA
AB futures data supplied bv CMS.
Taa
Prices at auctions in the main producing
countries this week were generally fnm hut
in Australia ana Now Zealand there was no
clear advance. The Eastern market indica-
tor w Austraka dosed at 576 cents, just 1
cent higher thin a week ago. the western
indicator was unchanged at 535 cents: and
In New Zealand the tram mtScatar was
down 1 cent to 467 cents a kg. Prices rase
crude sharply m South Africa but weakness
In the rand has to be taken Into account
there. Apart from die absence of any reaBy
dear trend ti prices, wool ottered at auc-
tion is being token up well by the trade,
with clearances better than for some time.
Sterling strength presents some problems
lo a UK trade wMdh lor same rime has
been better placed than many competitors
on the Continent of Europe .
■ COCOA UFFE (E/tarme)
Sett
Days
Open
--j|- r, ^ ||| t j.
pnea oiiy mgn
Law vu tat
Dec
324
-7
938
924 1.6SS 27.049
IBsr
956
-6
066
956 1.695 42.769
M«T
974
-6
964
973 241 6 16.117
Jnl
969
-6
999
992 706 12.143
S«P
1005
-6
1015
1006 838 5Z75
Dec
1017
-6
1026
1017 209 4.469
Trial
0,194131,697
■ COCOA CSCE (10 tonnes; 8/tonnes}
Dec
1353
-11
1366
1350 4,203 21.734
Mwr
1392
-5
1401
1389 3.488 24.564
May
1413
-7
1420
1411 179 8.988
Jri
1426
-3
1431
1425 69 6^37
Sep
1441
-2
1450
1440 108 5.789
Dec
1462
-2
1470
1469 48 816
Trial
8£D3 77521
■ COCOA QCCOt (SDR* a/tonne)
Oct » Price Pie*, day
Daly 1022.60 1011.49
■ COFFEE UFFE (S/tonne)
Ho*
1463
-19
1488
1460 1532
5,015
Jan
1385
-2
1390
1375 2.124 15,420
Mar
1334
+2
1340
1320 472
8J77
May
1318
+1
1320
1302 439
3552
Jnl
1319
+4
132D
1312 57
488
Trial
1319
+4
1304
1304 3 133
4524 32527
■ COFFEE ■€■ CSCE (37.5001 bs; cents/lbs)
Dec 117.20 -195 11190 1163S 5.129 11358
Mar 106.10 -020 107.25 105.60 2.006 10.109
May 10385 -0.10 104Z5 10290 685 3,712
Jut 103.40 +0.40 102.50 10250 364 1,079
Sep 10225 -HUB 10225 10225 141 519
Dec 101.95 -0.50 - 101.00 63 409
Total asm mom
■ COFFEE (ICO) (US cents/fround)
Oct 30 Pm. day
Comp, dally 9409 99.43
15 day overage 9129 99.33
■ WHITE SUGAR UFFE (S/tanna)
Dec
309.1
-38
312J>
3080 1004
7,713
Mar
305.5
-3.6
309Z
304.0 1513 12.662
May
307.3
-3.4
3104
306J5
526
4,544
Ang
3094
-3 6
312-2
308 8
224
1.706
Oct
302.4
-4.4
30BA
303.5
25
1,003
Dec
305-2
-4Jj
306-6
305.5
13
284
Trial
3A88 2W«
■ SUGAR 'll 1
CSCE (1 1 2.0008*;; cents/lbs)
Mar
10.30
-a 17
10.46
1029 6.300 85,357
May
10.44
- 0.10
10.54
1042 1.681 29,467
Jnl
10.39
-0.09
10.48
1038
423 19308
Oct
10.39
-0.07
1046
1038
160 11,184
Mar
10.42
-0.03
10.47
10.42
65
3533
May
10.42
-0.03
10.46
10.44
103
607
Total 8^08144997
■ COTTON NYGE (SO.OOOttra-. cena/Tba)
Dec 72.05 -0.90 73.45 72.00 5,601 24,742
Mar 73.84 -0 92 75.30 73.60 2,697 13,788
May 74.95 -0.95 7620 74.90 635 8.158
Jot 75.45 -0.98 75.74 75.40 527 6.755
Oct 76.13 -0.42 76.45 78.40 17 1275
Dec 7629 -0.01 76.50 7620 34 4 503
Total E4B9 SBjBBS
■ ORANGE JUICE WVQE H5,000fc8; crataflta)
No* 10620 -1.75 10720 10525 250 5209
Jan 99.80 -1 .55 101.80 99.40 535 8,435
Mar 10250 -1.85 10420 10225 288 4205
May 105.10 -200 106J50 1 05.10 68 1.127
Jol 107.60 -220 108 80 IDS 00 17 546
Sep 109.10 -220 - 250
Total 1,141 19266
VOLUME DATA
Open [merest and Volume data shown for
contracts traded on COMEX, NYMEX, CST,
NYCE. CME. CSCE and IPE Crude OB are
one day in arrears. Volume & Open Interest
totals are lor «jl traded mon th s.
INDICES
M Reuters (Base: 1879/31 ■ 1001
Oct 31 Oct 30 month ego year ago
18G82 1858.3 1018,A 2121.4
M CRB Futures (Base: 1967 s TOO]
Oct 30 Oct 29 month ago wear ago
241.66 241.11
■ QSCI Spot (Base. 1970 c 100)
Oct 30 Ocd £9 month ago year ago
210.82 £10.17 205.22 18271
■ LIVE CATTLE CME (40.000toa; centa/Bm)
Sett bays
Opao'
Price chaaga Mgfa
low
M tat
Dae
66-675 -0.175
66.925
66.375
7,466 38,381
Fab
63.475
63.725
63 ZOO 2537 18588
Apr
B5ZS0 +025
65550
64.900 1513 12526
Jan
63550 +0.175
63-275
62850
483 5520
Aug
02525+0.125
62500
62450
128 6.136
Oct
65.000
65.250
64.950
87 3.105
Total 11,711 84*»
■ LIVE HOGS CME (40,0001 teg centa/lbs)
Dec
54.400
-055
55150
54.150 5579 15.016
Fab
74.150
-05
75.150
73.950
2639
8,446
Apr
69550 -tt725
70550
69.900
601
2,924
Jm
74.650
-0.6
75.250
74550
398
1093
Jri
72.650-0.475
72550
72.450
81
774
Aug
69.175
-0.45
80.700
89.150
82
855
Trim
9,143 31589
■ PORK BELLES CME (40.0008x1: cantsrtbo)
Fr*
66500
-Z25
71500
68400
1523
4,818
Uar
68575 -2.375
71.000
67550
153
510
Mar
69500-2525
71 575
69.250
54
350
Jul
69.700 -2575
71.000
09.800
70
1B2
Aug
60 . 00 a
-2
-
60.000
4
48
Trial
1589
5409
LONDON TRADED OPTIONS
Strfice price 8 tarme — CaBs — — Puts —
■ ALUMINUM
(99.7%) LME
NOtf
Feb
Nov
Feb
1400
25
93
10
41
1425 .„
12
70
70
51
1450 .
5
57
57
64
■ COPPER
(Grade A) LME
Nov
Feb
Nov
Feb
1900
82
124
6
88
1950 _. . _. ._. _
45
100
18
113
2000_ - _.
20
79
43
142
■ COFFEE UFFE
NOV
Jan
Nov
Jan
1500
16
21
133
187
1550 . .
12
15
178
231
1600
9
10
224
276
■ COCOA UFFE
Dec
Mar
Dec
Mar
950 _ ...
6
39
32
33
975
3
28
54
47
1000
1
20
77
64
■ BRENT CHUDE
IPE
Dec
Jan
Dec
Jen
2300
-
-
50
-
2350
-
-
-
-
2400
-
64
-
-
LONDON SPOT MARKETS
■ CRUDE OIL FOB (per barrel) +or-
Dubai
S20.9i-0.95x
-0/49
Brent Blend (dated)
$22.62-2.64
-0.535
Brent Blend (Dec)
$23.02-3.04
-0.485
W.T.l.
S23.48-3.50x
-0.73
■ OH. PRODUCTS NWE prompt driwiy OF (tonne)
Premium Gasoline
$237-239
+2
Gas OB
$219-221
+1
Heavy Fuel CHI
$117-119
-1
Naphtha
5224-226
Jet fuel
$248-250
+2
Diesel
$237-239
■ NATURAL GAS (Ponce/therm)
Bacton (Dec)
13.60-3.75
-0.025
PWdIhii Asm. rat London (01711 339 8, He
■ OTHER
Gold (per tray az)A
$370.80
■0.40
Silver (per tray 04 $
485.50C
+2.00
PtatSnum (per tray az.)
$38i jn
+0.75
PaBedium (per troy oz.)
$116.50
+0.75
Copper
98.0c
Leaf (US prod.}
45.006
Tin (Kuala Lumpur)
14.80r
+0.15
Tin (New York)
277.50
*2.00
Cattle (Wo weight)
97.360
-0.4C
Sheep (We weight)
122. 5Sp
+3Z2-
Pigs (five wwghqr
93-SSp
-0.90*
Lon. day sugar (raw)
S262.2Q
-1.60
Lotl day sugar (wts)
$319.90
-2.70
Bstey (Eng. teed)
Cl 00.0
Maize (US No3 Yellow]
127.0
Wheat (US Dark North]
Unq
Rubber (D«c)V
82.00p
Rubber (Jan)V
82.00b
Rubber (KLHSSNol)
315.01
♦1J
Coconut Oi (Ph*§
$ 750.0V
+10.0
Prim OS (MatayjS
542.5s
+10JJ
Copra tPh3)§
5435-Ov
Soyabeans (US)
191Hz
-12
Cotton Outlook'A' index
75.75
Woottops (64s Super)
406p
-12
E (Mr loms irim affmfw M od p panccflig. c conta/b
r foggftAq. m MA| w r oorts/kg. , the * Oc UNn x Nov
V Leman RrydcaL 8 Ctf RkSMam. 4 BuOon marfter
dost ’ Change an wee#. TBased on 1.754 head at
add.
CROSSWORD
No.9,214 Set by ARMONIE
ACROSS
l Be concerned about politi-
cian's personal character
(7)
5 Time to stir a rich confec-
tion 17}
9 Famous books Edward
acquired (5.)
10 Public announcer Is one
attempting to take posses-
sion of private club (4.5)
11 Cleo later cooked a sort of
roll (9)
12 Classically elegant room (5)
13 Lie about second-class food
(5)
15 A quiet young attendant,
about to finish the supple-
ment (9)
18 Obstruction made back run
round pole (9)
19 Hapless daughter, rejected.
Is to lose heart (5)
21 Expose a saint's blunder (5)
23 Succulent fruit found in a
recent development (9)
25 A criminal catches viral
infection in profusion (91
26 Dash back to get European
business (5j
27 The high point is when the
first lady gets to lie down
(71
2 S Beat the fellow for touch-
ing (7)
DOWN
1 The capacity is fulfilled (7)
2 Refuse carrier made young
writer get up (S 3 )
3 It is used to wash tender
space traveller ( 5 )
4 Admit soldiers to popular
harbour (9)
5 Weather Otto welcomed,
being partly drier (5)
6 Cue tn hand, playing with-
out restraint (9)
7 Dash around Northern
Welsh town (5)
8 An artist in every perfor-
mance finally gives p ain to
the listener (7)
14 Captivate parent, messing
about on the river (9j
16 Having foreknowledge of
the Channel Isles in Uria
day and age (9)
17 Hate to fade in no time ( 9 )
18 The army is on time to get
the captive (7)
20 Clergyman entering
enclosed bar (7)
22 Plunder is common around
Leatherhead (5)
23 Ensemble performing with-
out protection? (5.)
24 Change a place in West
London <5>
Solution 9.213
FINANCIAL
TIMES FRIDAY NOVEMBER l 1996
Offshore Funds and Insurances
FT MANAGED FUNDS
;a$885*2&
FINANCIAL TIMES FRIDAY NOVEMBER I 1990
FINANCIAL TIMES
FRIDAY NOVEMBER 1 ■*»
LONDON STOCK EXCHANGE
Footsie regains its poise in late trading
FTSE All-Share Index
Equity shares traded
Turnover By vohjnw (rnJI^.
(nxra-ftwrV^ btwmost and aw™**-* w*now
1.000 -
MARKET REPORT
By Joel Kibno
The UK market yesterday made a
brave attempt to regain its poise
following Wednesday's quarter of
a percentage point rise in base
rates, but there was no hiding
tbe fact that inflation is now
back as an issue for investors.
Strategists continued to discuss
the implications of the chancel-
lor's move and many believe a
give-away budget later this
month is now more likely, partic-
ularly after a new opinion poll
showed the Labour party with a
commanding 28 percentage point
lead. However, it was concerns
about the inflationary pressures
in the economy that moved cen-
tre stage.
The FTSE 100 index opened
some 11.6 points down on the
back of those concerns, although
Wednesday's fall in the US equity-
market also played its part in
denting sentiment.
Mr Richard Jeffrey, group econ-
omist at Charterhouse bank, said:
“Prior to yesterday's increase,
higher inflation was an area of
speculation by individual econo-
mists. But by raising base rates
the chancellor has put inflation
on the market agenda."
However, it was not all doom
and gloom and some continued to
believe in the underlying
strength of the market. One such
optimist is Mr Philip Wolsten-
croft, UK strategist at Merrill
Lynch. He believes the market
will continue steadily ahead
because, "profits growth will be
enough to offset p/e (price/earn-
ings ratio) contractions brought
by tighter monetary policy”.
That feeling of underlying
strength, together with an ele-
ment of position covering by
bears, saw the early weakness of
the market reduced by late morn-
ing. However, volumes were ini-
tially low - a clear indication of
traders' continued caution and
the general unwillingness of
some of the leading institutions
to enter the fray.
That all changed in the after-
noon. The early firmness on Wall
Street following the release of
sluggish US economic data
helped trigger a turnaround in
London's fortunes.
A firm futures contract, which
was trading at a premium to fair
value, also helped the cash mar-
ket shake off some of its recent
gloom. Footsie moved steadily
ahead to close at the best level of
the day. although dealers
suggested a further advance had
been checked by continued ner-
vousness about inflation.
The leading index finished at
3,979.1, a gain of 15.2 on the day.
recovering from a low of 3.95L9.
Tbe FTSE 250 continued to lag
behind and -closed 3.3 down at
4.422.5. Long-dated gilts also
came off their lows, but were still
down £ at the finish.
With activity having picked up
in the afternoon, volume at the
6pm count was 659.5m shares,
down on Wednesday's 720.8m
shares. The value of customer
business transacted on Wednes-
day was £1.3bn.
There was renewed interest in
the food retailers, which analysts
suggest is a defensive sector in
the new climate on interest rates.
Earlier this week. Charterhouse
Tilney suggested investors go
overweight in the sector. Asda
advanced on favourable AGB
marketshare data.
SsuckExM
Indices and ratios
FTSE 100 3979.1 +16.2
FTSE 250 4-122.5 -3.3
FTSE 350 1982.7 +5.6
FTSE All-Share 1956.90 +4.8S
FTSE All-Share yield 3-60 3.79
Best performing sectors
1 Electricity - +1- 7
2 Retailers: Food - +1-6
3 Utilities - +1-2
4 Extractive Industries ...« ....+1.2
5 Water
FT 30 28t0.9 +H 3
FTSE Non-Fins p-'e 18 0B 1&00
FTSE 100 Fut Dec J °“.° "t 0 °
10 yr Gilt yield . * A'no ■
Long gllt/equity yW ro**° —08
Worst performing sectors
1 Healthcare -*’■
2 Building & Construction
3 Transport “9'j'
4 Engineering: Vehicles
5 Atcoholic Beverages -£>■'
Broker
boost for
By Peter John, Lisa Wood
and Ramraj Gogna
A powerful showing from
the UK generators placed
them among the best Footsie
stocks on the day as one or
their brokers took a hard
look at their performance
and followed it up with some
enthusiastic research.
Both National Power and
PowerOn shrugged off the
general weakness in the elec-
tricity sector, with UBS tell-
ing clients that worries over
the companies were exagger-
ated.
UBS believes arguments
about competition from a
second "dash for gas” are
unjustified. It adds that the
generators are in any case
unlikely to suffer a loss of
margin as they will increas-
ingly be able to cut costs
through buying cheaper
coaJ.
The broker points out that
both have underperformed,
but prefers PowerGen on the
basis that the new manage-
ment is focusing on share-
holder value and the differ-
ences between the two
companies have narrowed.
UBS electricity analyst Mr
Iain Turner added: “On an
enterprise value basis,
PowerGen is 30 per cent
cheaper than National
Power and the market does
not seem to have appreciated
this."
It has put a 730p a share
price target on PowerGen
and a 52Sp a share target on
National Power. PowerGen
shares r>ise 18 to 510p while
National Power lifted 13* •+ to
407p.
The food retailing sector, a
popular choice for defensive
investors at a time of inter-
est rate rises, performed
well, with Asda. tbe best
stock in the FTSE 100. rising
4*4 to 117' sp on trade of 21m
shares, the heaviest volume
in the market.
This was partly because of
monthly figures from AGB
Research which suggested
that, in the month to Octo-
ber. Asda's total sales were
growing at the fastest rate of
all tbe main food retailers.
Safeway, which rose 10 to
364'-4p, was also said to be
doing well.
In addition, LIBS upgraded
its forecasts for Asda from
£3 35m to £340m this year
and from £3?5m to £3S0m
next year. UBS also reiter-
ated its buy stance.
Earlier this week. Charter-
house Tilney recommended
an "overweight" stance on
the sector.
Cookson, tbe industrial
materials group, fell 10'4 to
226 l .sp, with ABN Amro
Hoare Govett downgrading
its profit forecasts for the
□ext two years mainly
because of the performance
of tbe group’s electronics
division.
On Wednesday. NatWest
Securities also trimmed its
forecasts.
Shell Transport, one or
four big companies to report
this week, disappointed with
its figures - but only at the
mar gin
The shares fell 13 to
1007'4p. continuing a slide
which has taken the price
down from a recent closing
peak or 1056p as the market
reacted to figures slightly
below the consensus of ana-
lysts' forecasts.
However, one specialist
said if the effect of explora-
tion charges, redundancy
and stoppages were added
back, the picture was much
as expected.
More significantly. Shell
revealed it now has no net
debt and the market is
poised Tor news about signif-
icant restructuring of the
European refining
operations as well as a joint
venture with Texaco.
It will hold a big presenta-
tion in New York on Decem-
ber 13 and analysts said
investors may hang fire
until then.
Body Shop hardened 4'.-i to
200p after results at the top
end of the range, while King-
fisher bounced 6V* to 653Vtp.
Thorn softened 5 to to 346'4p
following its ann ouncement
that it was to challenge a
Wisconsin ruling on rental
purchase transactions.
Pilkington hardened l 1 .* to
171p, in spite of a fall in first-
half profits, as had been
expected.
BZW, which left its fore-
casts unchanged, moved the
stock from a “hold'' to a
"buy" because it said the
outlook painted by the group
was rosier than it bad
thought and recent price
increases in Europe
appeared to be sticking.
Guinness fell 5 to 440p
after what one analyst
described as dull figures for
the Far East from Seagram,
a big competitor . In addition,
marketmakers have been
defensive after speculation
that LVMH might fund Its
£1.53bn acquisition of a
majority stake in DFS, the
FT 30 INDEX
Oct 31 Oct 30 Oct 29 Oct 28 Oct 25 Yr ago 'High
‘Low
2810.9 2799.1 2819.3 2839.4 2834.1 2577.7 28950 2688.8
Ord. drv. yield
406
4.07
4.03
4.01
4.01
4.12
422
3.76
P/E ratio net
18.99
16.95
17.10
17.22
17.20
15.52
17.48
1580
P/E raho nd
16.83
16.79
16.94
17.06
17.04
1525
17.30
15.71
FT 10 iWi ccmsUMn ivgh 29852 OUI/K. i cm 434 2805140 Base Dam 1.7
■35.
FT 30 hourly changes
Open 9.00
10410 11.00 1200 1300 1400 1500
16.00
High
Low
2787 4 2792 3 2 795 1
2793.T 27930 27940
2796.8
2799.2 2808
2 28100
27062
Oct 3T
Oct 30
Oct 29
Oct 28
Da 25
Yr ago
SEAQ bargains
35.647
36.098
38.313
42.436
34.484
28.147
Equity turnover (Emit
-
1335.6
1203 1
12052
1481.1
1542.4
Equity bargainst
-
27247
28.510
32.501
20.340
30036
Shares traded (mOt
_
515.8
497.9
4232
458.6
5930
rEnokidlng iran>-ma1«ol business and ovameas nmner.
Oct 31
Oct 30
Oct 29 Oct 28 Oct 2S Yr aoo
■High
■Low
FTSE AIM 102500 102220 1021.70 102220 1021.90
IS FTSE imemabcnal Limited 1996. AS rights reserved. Tor 1996.
1140.40
965.70
■ London marks! data
Rises and falls'
Total Rises
549
52 Week Mgha and lows
Total Highs 82 '
UFFE Equity options
Total contracts 41.409
Told Falls
758
Calls
24.480
Same
1299
Total Lours 131 j
Puts
16029
Oct 31 'Data based on Equity shares listed on the London Sham Service.
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[email protected] or post to FT Discovery. Financial Times
Information, Fitzroy House, 13-17 Epworth Street. London. EC2A 4DL.
FT Discovery
American duty free shopping
chain, by selling part of its
holding in Guinness. How-
ever, analysts said tbis was
unlikely as LVMH had a
strong balance sheet.
Stakis hardened one
penny to 99'jp after it con-
firmed a fg?.Ptni rights issue
to buy the Metropole hotel
chain.
Healthcare group Eadie
Holdings fell 5*v to 12'4p on
a profits warning.
Printing specialist Wace
fell sharply after warning
that 1998 profits would be
“substantially lower than
current market expecta-
tions". The shares were
down 65 to 69! ip.
Insurer Commercial Union
spiked up 9'-i: to 648 Vi p just
before the close of trading on
the back of an options-
r elated trade carried out by
one US broker.
Pharmaceuticals leader
Zeneca fell 24 to 1672p an
continued profit-taking as
overseas earners remained
out of favour in the light of
the UK rate increase and the
strength of sterling.
Chemicals group Court-
aulds rose 16 to 456p with
BZW reiterating Its positive
view on the group.
Airport operator BAA shed
9Vi to 497' ap in the wake of a
report suggesting it could
face a big tax bill under a
Labour government
The press report said BAA
could have to pay more than
£500m if it was included in
Labour plans for a windfall
levy on privatised utilities.
However, some analysts said
BAA was not regarded as a
prime target for the levy.
Perkins Foods softened 2
to 84p following its
announcement of a one-for-
six rights issue at 74 pence
per share, raising £15.5m to
help fund the acquisition of
the Dutch Disselkoen Group.
One analyst said that the
market had not been expect-
ing a rights issue and it had
not gone down too well. He
said the company would
have been better off using
debt rather than equity to
finance the purchase.
Grampian TV added 27*/*
to 327 Vsp on very thin trad-
ing with speculation con-
tinuing about a takeover bid.
Scottish TV is the most
likely contender, according
to analysts. Other potential
takeover candidates also
hardened, including Border,
which rose 5 V, to 306’ :p. and
Yorkshire Tyne Tees which
increased 25 to l267Vip. Scot-
tish fell 1 to 731Vxp.
Mondas, a business soft-
ware company closed at 90 l 4 1
a 15Vip premium to its offer
price. Jardizterie Interiors,
which was floated at 114p,
closed at 125p.
FUTURES AND OPTIONS
■ FTSE 100 INDEX FUTURES fljFFE) E25 per lull Index poln^
lAPTI
Open Sett price Change High Low
Dec 3977.0 4003.0 +20.0 4004.0 3975a
Mgr 3&99.0 4018.0 +20 0 3990 0 3989.0
Jwi 4033.0 +20.0
■ FTSE ZSO INDEX FUTURES ILlFFE) CIO per fuU HKfex pgtm
4460.0 - 4460 0 4460.0
EsI. id Opon ml
1 1864 62158
10 735
0 13.' J
Dec
4460.0
4009
100 INDEX OPTION UJFFEi f3975 I £10 per lull index point
4000 4050 4100 4150
CPCPCPCP
31 «'* 12b 77 3 IS 1 175
71»-71 47 98 28 132*2 14*2 ’78
97 88*2 72'- 115 491- 145 33b 132*2
3800 38S0 3900 3850
CPCPCPCP
No* IBb 3b 147 6b 101 b 12 Wj = 2
Dec 222 1 7b 178b 24 14012 36 1«b SI
Jan MO 29b 201 40b 162b 52 128 69
fell 261 U 221b 53b «b 65b 1®b 83b IWblgJb 9* »28 70b 157 52b 192
Junf 311b 91 247b 124b 188 163,J 138 ‘ ,3
Ctfel 13,442 Puts 4.393
■ EURO STYLE FTSE 100 INDEX OPTION lUFFEi CIO per lull mde« pomt
3875 3825 3976 4025 4075 4125 4175
5 123 9b >1 16*2 45b 31 20*2 56 7 93 2 136b 1 '®b
168b
186b 21b 157
222 34 182
Mar 250 61
Jurf 298 99
Dec
Jan
58 58 SO 36 107b 20b »»b 11 191
73 Bib 93b 57b H9b 39b 151b 26 188
122b 129 76 180b
176bl»b 12Bb 217
ftafc 2_96* Puis (-a) • Untatyng Mm value. PnoUums ‘Imam ora baaed an uttenwrt (nicy,
t Lung Hand expkv norths
30 119 41b 86
44 144b 56b I”
180b 89b
233b 129b
LONDON RECENT ISSUES: EQUITIES
Issue
Ami
Mkt
Close
price
palel
cap
1996
pnee
Net
Div. Grs
P.-E
P
up
(DnJ
Hbjh
Low
Stock
P
+/-
div.
cov. ykl
net
§3
FP.
70S
4*4
4 fBeechcroft
4
_
_
.
132
§135
F.P.
47.1
162b
152b Charles Taylor
161b
L42
0 3
3J
51.3
-
FP.
907
162b
157b Itteep Sea Leisure
157*2
-
-
-
“
ISO
FP.
294
169b
759*2 Ottran Bectm
159*J
-1
W2 75
2.9
22
15.1
§146
F.P.
350
246
148'
SecRetaiSys
170 +4*2
-
-
<1
FP.
11.4
316
305
Eurasia Mining
305
-
-
-
-
§80
FP.
249
92b
90b
Tunes, First
90*2
bw-
-
-
100
FP
101 .5
113b
101b '
Goo Inter Med
101*2
-
-
-
-
§
F.P.
-
127
111*2 HartOona B%
121
-
-
-
-
§100
F.P.
249
99b
99 hflthcare Refcrm
99*2
-
-
-
-
FP.
1.867
429
358 Imperial Tobacco
358*2
-1
W2Q.0
iS
7.0
• 2
§
FP.
540
177
164*2 Interoute Tflteem .
164b
-1
-
-
-
-
FP.
11.0
132*2
124 b tJarJnerte kits
125
-
-
-
-
§285
F.P.
1380
310
292*2 John D Sports
298b
+1
L40
2.5
10
28.1
§140
F.P.
336
160*2
14Sb Lovendon
157b
R3.4
30
27
123
72
F.P.
270
79*2
73b tloltus Road
75
-
-
-
"
FP.
420
131b
128 Lomond Undrwrtng
130
-
-
-
-
§10
FP.
403
12b
11*4 fMeara Group
11*4
-*4
h02
-
21
.
F.P.
9193
cielL
E12JI MMeraiMn Cham
C12l*
-*«
060c
-
10
-
-
F.P.
546
90b
82*2 fMondas
90*2
-
-
-
-
§154
F.P.
190
2iib
167 b Oranml ReJ
205b
r*2
-
-
-
232
170
FP.
1.009
177
187*2 ThtsUe Haleb
167b
-b
R17
20
28
18.0
§250
F.P.
192.1
302
282b Ultra EWn
295*7
RW60
2.3
2.7
200
9
FP.
102.3
62
52 tlfirwyCorp
54
-
-
-
-
t Alternative Investment MarhrL § Placing price. ' MraduCliOrL For a Ml exptorvmcm ot al
outer eytndole please rater to The London Share Service rates.
t#t- GOLD MIN ESi lNOEX
» t f' -
:fe
i-i
Oct
% chg Od Year
Gross
d,
P/E
52 amok
30
on day 29 ago
yield %
ratto
High
LOW
Gold Ittnas Max (31)
■ B ajia na l Men
Africa (13}
Australasia (6)
Monh America (12)
188935 +43 187837172335 138
24M.77 -08
2132.18 -03
170132 +0.9
2445.33 2272.74
213690 223434
188552 1496 98
3.14
263
0 75
35.60
2134
6437
1.73 1722AI
355386 227274
32734 2005 75
21B6.39 1488.94
Copyright FTSE inter na ti on al Lfrtmd 1996 am rights laaanrml F^juraa in fcradwts anon
rajmnor of companion Baals US Dotara. Ba&o Valuer 1000.00 31/12'*' t Partial. Lalast pnooa
were imavarabto lor me erftion-
h-FTSB:.
S'c^ipfe's
fiaiic.Tv
; h’st.rjte .b'f
levCi
K^Se
C \
Day's
Year
Dtv. Net
PTE
Xd adi.
Total
Oa 3T chge%
Oct 30 Oct 29 Od 28 ago
ytcMK. cover
ratio
ytd
Return
FTSE 100
FTSE 250
FTSE 250 ex IT
FTSE 350
FTSE 350 Higher Yield
FTSE 360 Lower Yield
FTSE SmaDCap
FTSE SmaOCap ex IT
FTSE AS- Share
+0.4
- 0.1
- 0.1
+0.3
+0.5
♦ 0.1
3979.1
•W22.5
4483.5
1982.7
1882.5
2090.1
2107.89
2170.58
1956 90
■ FTSE Actuaries Industry Sectors
Day's
Oct 31 Chqe% Oct 30 Oct 29 Oct 28
396339 3993.5 40253 3500.4
44253 4434.7 4443.1 3073.7
4406.6 4475.8 4482.8 3891.8
1877.1 1989.6 20023 1742.7
1874.0 1886.8 1899.9 1742.9
20073 SOMA S1 12.0 174&8
-03 2171.76 217332 2177.97 193939
-03 2174.00 21 76.09 21 78.38 1 924.86
+03 1952.02 1963.50 1975.88 1721.98
3.94
3.52
3.62
3.85
5.17
2.67
3.14
334
3.80
2.03
1.50
1.52
1.83
1.82
2.12
138
1.65
1.91
Year
ago
Dtv. Net
ywfcllt cower
15.60 15330 1656.13
23.07 158.61 1803.16
22.68 166.98 1624.02
10.04 7636 1685.97
13.30 97.00 134937
22.07 54.07 148234
25.13 60.85 1802.99
22.65 64.57 1818.15
17.27 72.82 1689.29
P/E Xd adj. Total
ratio ytd Return
10 MINERAL EXTRACTKJNf24) 394804
12 Extractive tndustrtestS) 4241.19
15 CM. Integrated^) 3965.71
16 Oil Exploration 3 Prod{151 2867.42
-0. 1 3850.90 3090.01 381 0.05 2069.67 3.01 1 .63
+13 4192.02 4194.15 4201.63 4072 94 3.83 2.66
-0.3 3976.54 4023.49 4044.96 2853.01 3.77 1.45
2086.00 2893.332917.99 1874.10 1.85 1.71
213712005 168035
1238 162.00 120430
22.91 135.18 1777.19
39.58 52.04 1737.48
20 GEN INDUSTRIAL$(275) 2050.19
21 BurftSng 8 Construction^) 1187.60
22 Building Matte, i Mwchs{29) 1920.46
23 Chemicals) 2441.06
24 Diversified IndustrialstlS) 1465.63
25 Electronic & Elect Equ*X36) 2338.28
26 Engineerings 1) 2643.76
27 Engtnaemg. Vahk*»04) 3239.18
28 Paper, Pckg 3 Prtrrtir»gf?8) 2575.4 0
29 Tertllge 4 AppareHIQ) 1169.09
-0.1 2051.77 2067.13 2070.32 1928J30 4.17 1.71
-OS 1196.47 1215.33 1215.94 898.59 3.55 1.47
-0.5 193031 1955.03 196848 1671 .96 4.02 1.41
+0.1 243S 17 24 50S3 2449.79 230936 4.15 1.45
+0.6 145738 1475.80 1489.51 1751.95 6.92 1.61
+0.8 2320.72 2329.68 2340.64 2101.15 3.35 148
-03 2651.56 266437 2077.75 2107.59 3.09 2.46
-0.83285.71 3281.58 3284.43 2536.16 3.33 1.72
-0.5 2587J51 2595.31 2594.60 2890.37 405 1 .82
-0.1 1170.08 11 7B. S7 1185.68 1469.84 6.10 1.16
17.50 76.13 1141.96
23.99 30.99 1011.48
22.09 72.84 989.01
20.77 80.14 1176.68
1120 89.36 844.89
25.23 63.97 1233.05
16.40 72.32 1629.53
21.84 101.71 1709.02
1093 91.05 1093.10
1758 51.71 727.33
30 CONSUMER GOOOSH82) 3690.34
32 Alcoholic Beverages! 8| 2730.45
33 Food ProducersCSj 2558.06
34 Household Goods! 15) 2729.99
36 Health Cared 6) 1962.90
37 Phairriac«ittcaJst14) 5721.31
38 Tobaccog) 3602.33
♦0.1 3688.34 37Z705 3709.98 3420.77 3.90 1.93
-0.7 2755.39 2776.83 Z7B0.76 2876.00 4.64 1.63
+OP 2554.21 2568.02 2573.03 2430.44 4.11 1.84
+0.5 2717.30275621 2770.93 2538.47 3.74 2 25
-1.1 1984.88 1997.69 201 1 .55 1939.76 3.03 1 07
+0J 5703.19577001 5891.99 4697.22 2.99 2.01
+0 1 3599.92 367128 3678.69 4451.45 720 2.13
1608 12939 1388 98
i asa 104.19 1005.08
16.49 86.09 1174.11
14.85 100.09 1064.56
20.96 54.40 1210.41
20.77 162.93 1973.74
815 262.07 927.66
40 SERVJC£S{254) 2595.97
41 DetmxjTors(30) 2918.13
42 Leisure & Holetef25) 3179.02
43 Mediat45) 4372.15
44 Retailers. Food! 15) 2034.67
45 Retailers. General 5) 213231
47 Breweries. Pubs & Rest 121) 3135.78
48 Support SenncastSO) 2601.00
45 TianaportOS) 25 31 10
+02 2591.01 2600.57 2611 45 2110 55 2 86 198
+0.62901.81 2899.40 2883.95 2604.38 2.92 2.02
+0.6 3158.83 3173.12 3177.34 2472.16 2.75 2.03
-02 4380.45 4414.03 4420 72 3345.07 2.09 2.04
+ 1.6 2002.64 1984.51 2003.85 1900.01 3.86 2.29
+0.2 2127.51 2143.76 2161.67 1718.07 302 2.08
+00 3125.99 312403 31 19j60 2635.98 3.31 1.98
+02 2595.83 2599.83 2599.53 1836.35 1.88 2.26
-0.9 2553.36 2565.76 2590 A9 2220. 17 3.74 1.12
22J32 73 42 1370.43
21.15 79.68 1092.70
22-41 173.08 1728.80
29.24 91 89 160028
14.11 63.74 1315.72
19.96 63.40 1239 42
19.11 68.29 1520 53
29.37 47.97 1670.33
29.92 82.14 1075.40
60 UTTLmES(33]
62 Etectr1crtyt121
64 Gas Orstnbution®
65 Telecofnmun«iitk)nsf8)
68 Waterill)
2330.98
242a 15
1298.15
2003-25
2161.71
+10 2302.93 2302.52 2307.67 2478 34
♦1 7 2387.16 238BJ92 239300 2804.07
+0.5 1291.75 1298.15 1298J?7 1554.04
+1.1 1981.00 197707 198905 2068.44
+1 2 213800 2136.39 2118.53 2032.59
5.56
6.78
923
4.03
6.44
1.75
201
0.83
1.53
209
12.01 167.56 1042.08
6.32 429.17 1314 83
1625 119.71 710.31
20.31 50 32 93047
a46 sm as iP2r>.6o
69 NON-RNANCIALS4608)
2048.38
+0J2 204409 2057.19 2068.05 1819.81
301
1.82
18.08 7703 158741
70 FINANCIALS<1Q3)
71 Bonks. Retains)
72 Banks, Merchants
73 tnsurartc«(2l)
74 Life Assurancef7)
77 Other FmartciaipO)
79 PiapeftvtAI)
329009
4744.83
3717.99
1551.38
3785.72
2700.76
1048.42
+0.5 327308 3209.48 3319.74 2745.43
+0.7 4712.57 473&07 4791 .87 3825.1 4
+0.9 3684.52 3703.42 3721.46 3504.80
+0.6 1541.55 1552-93 1560.70 1 389.77
+0.1 3763.62 3780.54 3334 00 3310.69
+O0 2634.23 2682. 1 5 2678.44 240&54
-CL2 1B51.72 1654.97 1659.15 1367.86
4.03
3.83
2.00
5.42
4.13
3.96
3.90
206
2.71
2.81
207
1.78
1.79
106
13.13 124.19 144902
12.05 175.96 1588.21
1508 95.60 1196.84
10.18 79.70 1201.15
15.97 151.01 1001.05
17.67 8807 158803
25.39 48 S2 1031.78
SO INVESTMENT TRUSTSf1Z7)
314322
-0 .1 314a 71 3151.37 316803 2909.1 7
207
1.13
4902 60.33 1106.70
89 FTSE All-SharefSSSI
1956.90
+0J2 1 952.02 196150 1975.68 1721.98
3.60
1.91
1707 72.82 1689.29
FTSE Fledging
FTSE Fledgbng ex IT
1227.15
124106
-00 1229.91 123100 1233.76 107903
-00 1243.08 1244.92 1248.77 1079.78
2.80
2.99
0.65
0 57
ea?4 3001 1299.71
7341 33.05 1316 48
■ Hourly movements
Open 9JD0
1000
1100 1200 1X00 1400
15.00
■*8.10 Ffigh/day Low/day
FTSE 100
FTSE 2SO
FTSE 350
3952.6 3958.9 3959.4 3957.4 3857.5 3957.6 39624 2966.6 2975.1 2970.1 39519
4422L2 4421.5 4421.0 4419.0 4417.4 4417.1 4416.1 44ia 1 441B.9 4422.5 44T5>
1972 3 1974.8 1974.9 1974.0 1973 8 1973.8 1975.8 19774 1980 9 1682.7 19721
TVta of FTSE 100 Day's hgh: 430 PM Day's k?w. 8:32 AM FTSE lt» 1996 Wgh. 407J.1 (21/10/90 Law: 3K£' 3 naOi.-M) .
■ FTSE 350 Industry baskets
Ctoae Previous Change
Open 9JX) 10.00 11.00 12X0 13X0 144X1 15.00 16.10
Bldg & Cnstrcn 1172.5 11664 1165.4 1164.1 1162.3 1102.2 1155.9 1155.1 11564
Phainvic«jlKts 5582.9 5596.6 5591.0 5501.5 5584.7 5501.0 5592.0 5S10.6 5633.2
Water 2123.1 2124.S 2125.7 2124.5 212S.4 2129.6 2129 0 2137.0 2141.4
Banks, Retail 4770.6 4703.0 4766.6 4768.0 4765.9 4773.9 4730.4 4797.0 4003.4
1157.6
5649 0
2147 i
4805.4
1173.4
5631 4
2121. B
4772.7
-15.8
+1 7.6
+25.3
+32.7
For hjrtrwr inlormancm on the FTSE Actuarlas Share Indices please comae i FTSE Intemaboruil ^ 0171 448 1810
The FTSE Actuaneo Shore Indices are calculated tn oeeordaneo with a standard set of cpxmd rules r-statHishea >+, croc
Iniwnational in comuncOon with the Faculty ot Actuaries and the Institute of Actuaries, h FTSE lmem.it 7 on.il LrnZn ioS:
AB Rights reserved. T Sector P/E ratios ^eater than 80 and nar eaveis greaw
thnr 30 are not shown. I Values arc negative. Folowtng CanceBaten of the
Wickes pic 1 5 net dividend, ai ac^ustment has Men made to the Total Return
and Xd adj YTD tor Its associated Indices wtndh include FTSE 250 and Reudora,
General. DELETIONS: A1 brighten. Anogan. Pendkalen (Uk). Regent Corp. Shaw
fA.) a Co. Alliance Resources. Boustead, De/yn Group (FTSE Ftedqlingj. IN'I ERNAT10MAL
TRADING .V.OLUME
■ Major Stocks Yesterday
Vd. 'ToWXi aiy‘3
KXJs
pree
art
A30A Gnsupt
Abbey MaBoivVt
AJben FWwr
Afted Domecqt
AnpSan Waloi
Arucot
Af|o Wkaglnr.
Asnc Bra Fooost
Assoa. Bm. Pats
BAAd
BAT Inas-f
BBA
fflCC
BOCt
BPt
BPS into.
BTT
BTOt
Bank al Scorlandt
Baretiyst
Baast
BkM Circlet
BoAor
Boost
8u»c
Bnt. Aemspjcot
Brtoh Akwayet
6nMh Biotech
Brnoh
BnUsh Goa
BrtUrfi Land
Brtttai SteeH-
Bund
Bwmoh Castrolt
Buloit
i^obteS riflrat
Crdwv Schwecpcerf 1
Caraoon
Carton Commit
Chubb
Coota vi»e«a
Com m. Umant
Contpaea
Cookson
CourmuMot
Danoty
Do La Rue
Dmorrst
B4Tt
East M idUnd Etoct
nil Iiiji an hi > i
Eng Chrvo Ctova
Enterpnce CHTt
FKI
Forotri * CoL I T.
Goa AcddonrT
Genaral Bectt
data Welcomet
Glynwed
Oranodaf
Grand UulT
oust
OreenaUi
GflEt
GKht
Gwvasst
HS»: |75p shs)t
Hansont
HwrOom CroolMd
Hays
FUbdown
Hyoer
■Ml
iCIt
knpenal Tobaccbt
IndicapB
Johraun Uaohoy
KwA Save
Ladbrakot
Land Srasfllest
Lapone
Legal t Oeneratf
Uoyds Abbey
Uoyds TWt
LASMOf
London Becl
Lofrtio
LucoaVantvt
MH’C
MR
Maria & Spencert
Mcicurv Aasel Man
Momson (Wml
NFC
PtalWeal Boniit
NaDand Grvft
National Power)
i+oxrt
Northern Bed
Northern Foods
Oranget
Pearaonf
P &o+
Wdngtont
PowertSent
Premier Famos
Provident Financial
Prudanhatt
REXAM
RMCf
PTZf
Rocol
RaainKht
Rank •Sroiiot
RocMtl A Catmint
Redandt
Reed Irutf
Rentokflt
hautaref
Bobs Hoyuef
Royal S Son Aflce+
Bk Scot tond f
.
Salnsbury+
Scteodofst
Seodteh & rjew.t
Scol Hydro-Sect
SctdlBh Pwwort
Soars
Seoawtak
Sowam Trtjnrt
Shell Tmii yp ori-t 1
S«»»+
Slough Este
SrtWh IWK.I
Snvtn & NeohowT
SmW Beochamf
Smiths trots. 1
Soulhem Elad
South West Water
Standard CJwia t
Sterafkiuse
T&N
Tl Grt+mt
Tanroc
Tore A Cyfc-T
TavWr Woodrow
loWjVml Comma
Tiseot
Thames W elect
Thom
Torrtunst
Ungote
miwa t
■Jraiod Blecuta
Did News S MecBut
LFnted UlStKof
Vodawnet
WPP
Wteese* Waur
Wh*ft««adt
WUfljms Mdgs T
riMB Caraan
Wimpey
Wobntoyt
TorXahlro Elect
Vartohirtr Water
Zonecat
3iC
23.000
9. tOO
rr;
1. aoo
2.'5
382
3.700
■12.
1JWI
6.700
8.600
2. TOO
763
1.100
8.600
662
2jXW
6.000
6.600
2.800
4^00
597
3.400
182
2.300
282
1.100
1.700
2.100
13300
2.500
573
4.700
13300
367
3. -I0C
5.500
936
1.000
T.700
1.«W
2.500
1.700
1.700
8.400
641
4.300
700
1.100
775
807
IfOO
623
90S
2.300
1.300
B4J
3.500
6.008
233
837
3.800
1JW
153
3.700
464
2.600
1.100
123
15.F00
1.000
827
XT
2-000
J29
i.BOQ
4.100
1.800
284
laotr
38
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157
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3.400
01S
8.700
651
911
4A00
9.100
142
1.700
3.700
+38
641
734
1.600
973
8200
418
1500
580
1.100
2.400
2.400
2.400
4.600
816
241
1.600
806
761
3.800
28+
7-330
53300
532
800
837
1.300
1.900
4.400
3.700
3.400
5J00
4.9M
132
835
1-200
885
3.000
800
1-200
a 3oo
1.100
705
34
3.400
2.900
301
508
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a.
ii7b
•41 1
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+0
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476
-1
54Gb
771 b
.3
165
+1
♦c;
771 b
-ib
407 b
-9b
428
358b
• 1
neb
-1
asrtb
*7b
881
+1
382b
-4b
578b
-it
J9Ab
•8
257 b
+7b
233
*3
961b
• 10
789
♦J
M8b
•4?
405.
C24
732 b
1165
SM
22*b
119
191b
4S*2
170'+
237b
lorjir
149 b
489
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241b
402
117
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• 1
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226b -10b
450 *16
311b
589b
548b
“S
556b
210
150b
732b
379b
964
352
864b
JS«b
612
568b
253b
1185
440
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1290 *15b
381b
80 1*
128
513b
175b
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789
356b
■4
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-3 b
-7
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•»b
-ib -
eoBb
863 b
318b
199b
716
717b
323b
B26b
390
214
609
149 b
248b
427b
201
SI 5 b
1129b
161
193
701b
181
407
660
833b
199
185b
760
603 b
171
510
867b
460b
484
351 -lb
1085b -17
982b +14*2
277 -b
277 -I .
408b «3*l
711 +4I 2
431 -ab
1143 -9»2 -
412b »1
784 b +3
254 ->!
431b *6b
aab *ib
-zb
-ab
+i*s
•28
•4*2
+4
+i3b
-3
-4b
-2b
-1
•ib
-3 b
♦ib
♦18
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-1
soab
364b
384
1395
839b
275
314b
B7b
i’4 b
eia
1007b
988b
248
4Mb
187b
758b
820
643b
•10
•b
or
•4b
♦r
♦7*2
-8b
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+*
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-3
97
3.400
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863
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71*
27Bli
-1
1000
120
+*3
328
568b
♦ 1 •
2.400
90
O
347
477
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1.100
155
-1
70S
m'j
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5.7DC
332b
•8b
1.400
SS4b
♦ob .
LCAffl
346b
-5
1.900
258
1 1
382
432
-ib '
509
1291
,;l<
535
208
rS'l
275
673b
.Jl 2
■3.800
570
♦10*7
8000
537*4
*1*1
930
220
-*2
100
353 b
r*~
14X10
721
•i »• w .
1.600
897
1.700
750
757
442
2.500
363
IE'
126*7
477
729*1
620*f
1872
-ft
•8
-24
Based on tracing volume (or awlcciton of
major so&untwa dart thnugh the SEAO
system wnanrlay uivfl 4 30pm T lnd)cj»a jn
FT3E 100 index consMuent Al lmdRS am
roumtoti Sv*»«r. ExMl. port at FT
IniormoBoii.
33
34
FINANCIAL TIMES
FRIDAY NOVEMBER I 1996
&30 pa October 31
NEW YORK STOCK EXCHANGE PRICES
M n
N* * E
23% 17% MR x
Wig 33 AMP x
97% SB MR
60*2 371b ASA
S3>« 38% Aim
17% 12% AMMPr
20V 13%A6Mb(J
21 la^AEpBQM
37V 37% ACE LH
10V 9%A«Blth
T\ 6*1 ACM SrOBB 107 It
9*1 BVIOAMk 000 M
ift eh Parnate: 032 4.1120
187g 13% AonxMb 13
148 1.7 26 764 (CSV 27 28V
IJ» 10 180970 34 m 33V
18 4823 84% 80% B4%+3%
ISO 52 25 268 3ft 38V 38V -V
ON 1.9 218067 50% 4ft 60%
a* U 7 318 14 13V 14
a» 20 78 32 17V 17V 17V
41 IS 20 10V 18V
058 IS 13 472 65V 53% 55%
190 18 8 542x10% 10% 10%
25 7% 7 7
291 MV 8%
13 7%
49 18%
a
a
♦i
*%
a
172 2S 14 781 29
7%
18 IB
28 28%
27% Aeutti
21% IZAcram 1001638 21% 20% 21%
Z0% 17% tomjEjpf 118 24 1 103 SO 18% 10%
21% 10*4 Mm 18 S457 1 7% 17%
11% ftAdmop ------
26% 8% AM lac
53% *1% Aegon
6% 3% Arab
70% 57% MUl
40% 29% Atef
21% 17%A6LHax
31% 21% AimiED
fCh S0%«rftC
28% 18<2 Ann Fit
25% 15% Moraine
19% 13V JUH3M
33% 25A9TS1
30V 15% Amato
22% 17% Albany Ira
24% 14% Aim
47% 32% MOB**
40% SS% ABCUIAf x
43% 31% Ann x
34% 2a% AknAI
86 37% AMSt
-%
♦%
■ft
*3
a
I8S4S7 17% 17% 17%
016 1.7 8 78 9% 9 0%
110 17108 1445 14% 14 14%
145 18 15 109 51% 61% 51%
3 147 4% 4% 4%
080 U 88888 67% 88% 88%
140 IS 172161 u40% 39% 40%
1.06 60 17 180 021% 20% 21%
088 28 3 9498 031% 30 31% 4-1%
1.10 10 15 2284 50% 68%
0J0 18 14 423 19% 019%
36 104 23 22%
180120 9 S3 16 14%
728088 26% 25% 28
020 19 7 571 21% 21% 21
040 18 14 167 22% H% 22%
123 1.7 5 465 16% 15% 18%
st a
136 18 20 222 45% 46% (5%
136 10 17 104 40 30 30%
160 1.7 76 5372 34% 34% 34%
060 18 14 40(3 33% 33 33
056 1.2 30 4004 48% 44% 46%
65 38%AM*mn« 180 18 8 385 57% 58% 36%
ft
4%
ft
4%
3
-%
-%
ft
21% 13% AtaAl
31 28AUgP
23% 10% AlogT
30 18%/Uopca
28% 14% Alan Con
42 30ABagai
28% 21% ASnce Cap
13% lOAOwia
39% 20% Alruf
87 47% AI0S%
30% 24% Almerica*
10% 9% ABicr
56% 37% AMs
35% 26% AW dp
S% 3% AhHOto
77% 10% AWnmaA
39% 26% Oral
60% 49% MSB*
34% 74 Aba Cp A
6% 5*2 AmGnrtnc
14% 10% Am facts
9% 5% AraaGd
62% 45% Antnc
20% IftAmcmiM
59% 47% touts
"l 39% I
I Amend
010 17 22 5339 14%013% 14%
188 58 16 2001 30% 29% 30
164 3.1 15 307 21% 20% 20%
140 2.1 18 2494 10% 18% 18%
020 12 18 155 18 15% 13%
152 1.7 24 3263 31% 030 30% -%
103 72 13 136 27% 27% 27% r%
011 14 75 13% 13% 13%
120 12 12 61 039% 30 39% +%
080 18 18 4009 85% 66 85% ft
0.16 16 11 3868 28% Z7% 27% -%
184 83 91 10% 10 10% ft
8.78 1.4 13 5365058% SS% 56% ft
1 10 38 29 1334 30% 30 30% -%
17 1BQ 4% 4% 4%
118 1.4 22 1060 12% 12 12% ft
5 1370 32% 32% 32% -%
080 18 19 3203 59% 57% 68% -1
25 1B4G 20% 25% 26 *%
142 78 395 8% 6 B
028 18 17 07 14 13% 13%
108 12 22 BOG 5% 5% 5% •%
080 18 7 787 uB2% 81% 62% ft
156 27 11 109u20% 20% 20% +%
080 1.1 18 1093 58% 55% 55% -1%
ZOO 4 2 15 1391 46 (7% 47%
3*2 1% AnHOMs
109 68% Ann8
s 5V Am onp inc
9% 8% AmRsXB
*Z\ 24% l
i AmSto
IjjjC
20% 19 Am Bra N 15H 28 15 16 22% 22 22% . _
44% 3ftAfl£Fu 240 58 13 5145 41% 41% 41% ft
50% 38%AtnEd» 080 19 1312178 46% 48% 4ft ft
39% 32% AmGad 130 38 15 2657 37% 37% 37%
5% 4% Aid Gorki 038 78 307 5% S% 5%
23% 20% AmWiftf 80628.4 10 173 21% 21% 21%
24% lOAmHHto 176 3 4 11 121 22% 21% 22% ft
66% 47 AmHong 184 27 2610455 £1% 80% 61%
are 66.7 ib noo i% m% i%
140 0.4 18 3436 U109 108 108%
144 7.7 360 5% 5% 5%
(144 4 8 6 124 9 B 9
164 15 17 1177 41% 40% 41% *1
21% 17% Am Mfear 5K 185 88 B 18 18 18
22 17% Am Waff x 170 35 15 122 30% 20% 20%
1DD 25 6 374 35% 35% 35% ft
044 17 48 1789 084% 64% 84% ft
48 604 37% 37% 37% r%
2.12 38 13 4115 54% 54% 54%
41% 34%AmuiHx 128 3.1 11 35 41% 41% 41% ft
22% IBAnatak 124 12 13 313 2D% 20 20 •%
280 14 17 4818 7B% 75% 75% -%
110 18 10 27. 12% 12% 12% ft
13 219 20 19% 19%
0.12 15 3 910 9% 8% 9% -%
1.88 35 14 550 46% 48% 46%
130 15 80 1189 84% 63% 83% -T
192591 28% 25% 28 *%
096 4.0243 88 19% 19% 19% r%
198 2 5 25 7085 38% 38 38% ft
19 384 14% 14% 14% -%
1X4 35 16 1782 n58 57% 87% +1
35% 24%ApacheQrp 128 80 377323b35% 35 35% ft
9% B% ApuMuiFx 0GB 65 236 9% 9% 9% -%
23% 8%«4HMMi0 158905 21% a 21% +1%
36% 26% And P* A 112 13 IS 181 35% 35 35% ft
120 19 21 6822 21% 21% 21% 4%
380 SJ 11 142 48% 47% 47%
62 670 3% 83% 3% ft
38% 28% Aid Rn
84% 36% AmerRe
37% 25% AnSOidf
68% 49% Ancti
77% 65Amoeo
13% lOAngcaPH
Z7% 18% Ampnend
29% 7% Aim Inc
47 34% Ammatti
86% 46% Amt®*
30% 17 Analog
25% 18% AnoeBa
40 32% ArBKfl
20 12% Artdar
58 47% AoiCp
22% 15*2 ArcfiDn
54 47% faoChl
6% 3% Atmn
24% 22 Amu 31P 310 95
66% 51% Anfal#
53% 35% AfiwBf
0% 4%Artra&p
25% 16% AMRM
36% 23% Asma
25% ISMmKDR
44% 34% AMd
25% 20% AMI Cod
16% 11% AMPS: F
3% 2%As5«tbi»r
49% 35 AT&T
323% 260 AH BCD 2
14% 7%AMSos
a 16 Adnt Efly
135107% AtfWl
2 11 Attn
31 2D% ABKUEnX
27% 15% Angst
9% 6%AuwaFd
45% 35% Alton
37% 23%Ai*Oxn
16% II V Amoco
10% 5%AM(t
54% 36 tana
54% 36% AkuPt
17% 9 AMi Com
14% 7% ASX
46% 34% BCE
6% 5% earns
20% 16% Bate fan
37 22% BataxH t
zs ib% Bono Oc
32% 23% BaBCp
20% ISBMMd
30 12% Mf
29% 25 BanGE
43% 31% BncOnt
48% 35% BancoBI V
1»% 9%BCH
391* 33% BcmHaxcxi
55% 44% Brad*
91% 56% BaMAm
33% 3lV BMWY
M 19% BIM AOR
51 45 BankAm A
93 82% BonkAmB
64% 41% BUsm<
85 75% SUxeO 59
46% »l% BWoanA
B5% 61 BoATsJ
65 V CBaari
37% 27% BonMC FD*
56% 35 Banns Qp
39*4 2? J 4 Sima
E% 24% BrtKfl
16 10% BwvtRCI
11% 7% BatM
44% E'j Baawh
*6% 33 Bober
<3% 18% BayHMte
29% 25% BarSfias
40% 15% ESN
22 V 19%Bdrri83fi
9% 7%BtAfcic*
9% 8% Basra*
24% 17% Bex arm
447 g 41 BMrSJPtA
4 22% 22% 22%
ISO 24 22 1031 67% 88% B6% -%
11 797 47% 47 47% +%
123 40 2 128 5% 5% 5%
076 12 16 279 23% 23% 23% -%
060 31 102333 28% 2B 28% •%
032 20 101 16% 16% 18% -%
1.10 38 14 2534 42% 41% 42% +%
0.48 1.9 23 10 23% 23% 23% ■•■%
004 03 208 11% 11% 11%
138109 6 23 3% 3% 3% •%
1 32 38 3542441 35% 05 35 -%
280 09 2318% 317% 317%
028 12 7 BS &% 8% 8% *%
I 54 8.7 13 137 17% 17% 17%
590 4.1 13 3520 134% 132% 132% -1%
050513 1 82 1 |2 if
098 4.1 13 70 23% 23% 23% +%
015 09 44 1015 UZ7% 27% 27% -%
003 03 19 8% &% 6% ■%
080 19 28 2515 42 41% 41% rig
23 8028 25% 25% 25%
048 3.1 10 87 15% 15% 15% ♦%
8 04 04 0 234 9% 9 0%
OEO 1.2 11 1561 50% 50% 90% *■%
1.16 21 28 6348 54% 53% 54% +%
1.00 99 14 202 10% 8% 10%
27 2133 8% 7% 8% «■%
- B -
372 59 25 17381148%
120 31 7 165 6%
140 32154 430 18%
148 13 32 5549 38
040 29 16 24# 20%
060 25 21 108 24%
008 09 20 958 17%
19 KB u30
190 59 12 1436 27%
1.36 12 13 7398 1)43%
1 44 39 15 86 48%
023 19 38 17 X12%
120 10 12 358 39%
090 10 13 18 47%
216 24 12 6635101%
0 88 37 1335559 033%
007 03159 105 20%
325 69 37 48%
BOO 66 31 91%
1.76 30 15 5175 64%
548 89 2100 81
100 05 « 48%
400 47 12 3726 05
1 92 29 >: 8 63%
06B 34 18 1394 28%
160 32 12 24 1)56%
108 29 13 8172 38%
012 09 33 B560 26%
11 241 11%
005 06155 1002 7%
1 04 H 20 15«1 33%
121 30 18 0600 47%
2620887 20%
154 59 14 140 28%
9 694 E%
158 76 45 20
072 IB 4928 7%
081 90 126 0
060 29 6 1123 23%
292 69 3 43%
45% 48%
8% «%
18% 18%
35% 35%
20 20 %
23% 24%
17% 17%
29% 26%
27% 27%
42% <2%
48% 48%
11 % 12
39% 30%
47% 47% .
90% 91% +1%
33% 33%
20% 20% *h
49% 49%
90 91% r-1%
61% «% -%
81 81
48 48%
84% 84%
83% 83%
28 28%
56 56%
37% 39%
28 26%
II 11
7% 7%
33% 33%
41% 41%
2D 20%
27% 28
20% 21%
19% 10%
97% 7%
9 9
21% 23%
43% 43%
4%
*%
4%
4%
♦ I
+%
:i
4%
4
-%
%
+%
•%
♦%
%
lrtlic business decisions ore yours,
tin* computer system should be ouzs-
www. hp.com/gu/c-ompuiing
HEWLETT-
PACKARD
F% 20% AMU A 0137
% JJflxnywtB OJK
3324%Baga 148
1220 L
12% aVBonjft*
28% I2IMBU7
28% 24% Banai
54% 48%MR»H
18% T%Brt«
33% 40%8tOnx
12% 9% BarEnt
1814%BM«aSl 140 29108 301 19
44% 3D% BOodt 048 10 12 2794 38
29% 22% to* K PL 198 14 IS 45
m n
Oh % c
1M 39 13 139 28% 29% 25% -%
152 1A 17 29 37% 37 37
146 10 21 2411 44 Ct% 43% *1%
148 33 14 351 14% 14% 14% 4%
388 45 14 3492 80% 00% 80% .
140 34 7 2& 17 16% 18% •%
1.44 19 19 8311 40% 40% 40% +%
144 1.1 204457 39% 38% 39% *%
172 31 19 799 35% 34% 36 •%
400 7.0 2100 01 81 61
208 39 12 5B8 58% 58% 58% +%
- - 19 14 18 23% 23% 23%
am 79 B A A
15 17 773 31% 31% 11% -%
H 230 3239D 32350 323S0 >10D
4 1082 1074 1078
140 30 17 18 12% 12% 12%
18 2832 18% 18% 16% +%
390 95 45 28% 2B 26% +%
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CoaHmied aa ant page
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35
NASDAQ NATIONAL MARKET
338 pm October SI
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32% 5% Santo 0» U 14 ia 30% 30% 30% ft
3ft 25% Stanncm 1.12 42 12 320 28% 25% 2ft
32% 23% SHNk 074 28 25 1217 a 3$ 2ft ft
80% 5ft StarflnE IS 11 17 299109% 88% 89% *1%
2ft 22%Stantt 07228 10 M 24% 23% 24% +%
63% 41% StataSffia OH 18 102908(63% 51% 68% +1%
28% 22% SU Ra ta - 078 19 12 149 28% 2ft 2ft -%
13% 10% SttooBap OS 15 11 in 12% 12% 12% ft
W25%SarfCBR SO 6507 28% 27% 29% ft
1ft ia% SUB 10 147 14% 14% 14% ft
32% 18% fiMUnn - - 4 2544162% 32 32% ft
ft ftSaWHa 012 18 17 IS 7% 7% 7%
37% 2ft EkeaSMWl 080 18 17 288 33% 32% 33% ft
17% 12% StaBi CM 060 18 84856 15% 14% 15% ft
45% 2ZSWcH 61 1248 48% 4ft 43 ft
34%lft90to 13 1706 22% 22 22% -%
10% 6%SkMam 020 14 31 2838 6% 8% ft -%
ai3%Sknil%r 080 48 14 IB 10 1ft 18% ft
41% 82%SumMBcp 144 15 18 1844041% 40% 41% ft
6% 3% SaoBwc® 088 18 16 34 5% 5% 5% ft
a% aamar OS 08 194668 36% 37% 37% -%
42 32% Sudor 088 1.7 10 500 41% 40% 40% ft
n% -iftSnoucaAx 1.10108 S 78 10% tflft 10% ft
48% 32 SaHt I/O 3.4 17 7581)48% 45% 40% ft
16% ftanFsed 040 U 17 21 16% 1ft 1ft
2ft 22%&4Htr. .024 18 ifi 158 24% 23% 34%
32% 25% Stanncm 1.12 41 12 3S
32% 23% SftMk 074 28 25 1217
80% Sft StarSrc is 11 17 269 1
2ft2ftSnaO 072 28 10 38
63%41%StataSOa Orail 19 299Bi
28% 22% SUfe* - 078 19 12 149
18% 10% SMBBao OS 15 11 103
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2^2 14% Td Bm 11 335 15% 18% 1fi% ft
61% 32% Tart* 484796 64 51 2% •%
40% 33% Tcootefl 025 07 18 273 37% 36 36% -%
48% 40% Tamil 1.16 24 a 402 48% 47% 40% ft
36% SOTOroQx? 040 18 T( 436 31% 30% 31% ft
s 37HBED 064 1.1 14 572 S6% 56% 58% -%
29% 11% Tanast os « a is 26% 2ft 26% ft
34 2D % TysftB 75I40S8 034 33 33% ft
26 23%Tanaacx IS 88 10 10 24% 24% 24%
84% S7Trnsto? is 18 It 2067 75% 74% 75% *1%
73% aftTtotodaa Ott 07 11 176 72% 71% 72
11% 9% Tmucnffl 040 48 8 2 10 10 10
11 5%TtaKpn 020 14 B IS B% 8% 6% ft
18% 12%Traetodi 0-6 1-4 12 O 16% 18% 16% ft
55% 37% Tri*> 160 1.1 11 6482 54% 53% 54% ft
38% 20%T(adao> 024 08 11 1 SbSS% 28% 38%
SBSftTMCWla ISO 74 5 33% 33% 38%
14% 10 Wat 7 307 12% 11% 11% ft
83% SftTttMM* 120 18 14 607 61% 8ft 81% ft
25% 22%TrtCM 084 28 3C3 25% 25% 25%
36% 30% My OS 10 12 1412 34% 34 34% ft
30 27% Dam OS 14 91409 32% 32 32% ft
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27% 16% Ttn 060 16 » 116 a% 23% 23%
20% 12% Tucson B> 5 SI 19% 19% 19% ft
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S138%TtaW OSD 18101632 (01 49 $1 «2
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22% Iftaufi. 1.14 52 TT 777 22% 21% 2% ft
30% 2ft MUM* IS 38 60 01 26% 2ft 28%
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37% 23%\RrtSet 121 1360 29% a 2ft -%
20% 16%6M0[D(8 020 12 32 758 16% tflft 10% -%
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34% 27% mm 092 10 16 « 30% 3ft 30%
24% 16 Watson OS 18 a 12SS 16% 16% 17% ft
27022% Wrfx 580 18 13 2441 09% 268% 2fift +1%
22% 19% Wendy* 024 12 20 12384 22% 20% 20% -1%
30 22% Wtx! CO OS 21 33 70 27 28% aft
18% 14%WtotE OS 18 1840021*6% 18% 1ft -%
69% 4S%WMto S 365069% S% Bft ft
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16% 11% IMMo 020 18175 47 15% 15% 15% ft
34% SWtota 106 68 11 636 30% 30% 30% ft
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4% 2% WsbbCM OS 118 D 209 2% 2% 2%
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49% 3ft wyitni IS 38 a 2070 45% 45% 48% ft
17% IftWMKrtr 012 08 20 390 15% 15% lft
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29% 21% MSB OS 1J 18 1689 24% 24% 24% -%
26% 13%nBMtar a 83 14% 14 14% ft
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32 »1Mn&i IS 58' 13 1414 27% 27 27% ft
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31% 23% 1WC MR 071183 78 25% 2ft 25% ft
30% Z7%taHXT 090 1.7 24 5715 34% 34% 34%
29% 15% WUmlM 019 06 a 867 25 24% 24% ft
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38% 20%Tndag>r 024 08 11 103 s
36 33% TriCOnUd ISO 74 5
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ADCTto S 71 97 58% B Eft +3
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AdeaaAOR aiB 32 8u35% 3ft 36%
AdQtoSyt 03 351321? 3ft 34% 34% 4%
MLotfc 11 1400 10% ft 0% ft
MiPotrm 12 148 8% 8 B ft
AAfflMS 77B 30% 30 3ft ft
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AdantoA 036 121746 4ft 47% 48% +%
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AAaSdd 006 22163 3% 3%
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AaCMoy au 3 89 10 9% 9% ft
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I Arafrtwy* 105 240 0% 9% 9%
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AaftoCnl 2*11967 21% 2ft 20% ft
Amltaar ' 19 3823034% 3ft 34* +*
Aagcnlw 270891 81% 60% 61 ft
AndacteCp OSS 93 6% 5% 5% ft
Aatagfct OS a 19 Z7% 28% 27% ft
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Anroatoa 075 6 252 6% 8% 6% ft
AtooarCp 323828 49 47% 46% ft
MogaaEn 08* & 542 38% 37% 38% ft
ATP 56) a 8434 11 ,% 10% 10%
ApMItt 711064 29% 28% 28% ft
Aopfac aw atssa 23% 22% aft
Apptteea 005 a 1402 25>2 24% 24% -%
Aftafir Q2B 22 2(8 22% Sft
AKCal 024 12 829 10 9% 9,5 i\
Aigonaut IS 7 378 28% a% 28% ft
AaMWM OS 12005 5% (K% 5% ft
Armorri 06* *0 167 16% 10% 16% ft
Arnold In 044 18 299 15% 15% 15% ft
Armen 3 934 8% 5% 5% ft
AapecfM 44 538 59% 58 59 4-1%
AST ton* 0 435 4% 4% ft ft
ABdraon a 2 11% 11% n%
ABSEAlr on 11 416 a 20% a ft
ASnal 1317360 25% 25% 25% ft
Auras* 53*10 2% 2£ 2£
Atotak 02* 162118 a 22% 2% ft
AtoWo 2 443 3% Sit 3
AKXttiB 092 6 1564 10% 16% 18%
BE! B 096 a ia 9% 9% 9%
Briar J 000 1 639 5% 6% 5% ft
Btori.6 04012 599 18 17% 17%
BriyTT 132 *H *H 4% ft
Btmtac 675 13 30% 20% 20% -%
BarttanCp 084 11 291 19% 10% 19% ft
Baoknerth IS 10 13 36 35 35 ft
Ban too 044 131584 a % 20% a% ft
BricM 080 12 246 31% 30% 30% -%
BaaaatF OS 13 22 22% a 22% ft
town 020 14 4 6% 65% 6% ft
OHTedi 15 509 2<% 25% 23% ft
OglM 1214S 15% 13% 15% ft
Bgifcn a 388 a% a% aft
OB Send 41193 lit 1g lH ft
ngsyri 26653* 13% 12 13% +1%
«»*cp a 6 39% 39% 38%
OkdnYm 02D 1 830 5 1% ft ft
DBtorto 02) a 221 28% a 28% ft
DnrcnHta on 15 10 IS IS 15 ft
DtodBia 17 noo 28% 26% 26% ft
StoBton I8a72m3% 12% 13% *1
Dray® 024108 200 a a a -1
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DStocor 02414 T7S 41% 41 4ft ft
Mtt 032 13 848 27% 28% 2B% ft
OWeiif 27 1082150% 48% 49% ft
- E-
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EHfilWri 14 445 9% 8% 9% ft
EOTal QOS 16X420 20% 19% a ft
Eggbnd 11 6523 5% d*% s% ft
BacJrSd 040 8 146 2B% 19% 20% ft
areas 15710 a 56 55% sft ft
SiCMcta 4713869 S 37 37% ft
EncaeAN 22 11 ft 3A ft
Estate IS 504 Tft 17% 17% ft
EeceraCop 0 737 i\ tfl% i% ft
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(JdUFtxn Q 18 27 417 13% 12% 13 ft
tin tom 58367 25% 24 24% ft
(JKHW as 14 1072039% 37% 37% ft
Lane* 096116 43 17% lft 1ft
impact 8 62 ft 4% 4% ft
Ltd* led 73 235 i2 11% 11% ft
lmnq» 8 188 5% 4% 4% ft
UriktaS 171458 34% 33% 34 ft
Uaraenfr OSS 13 58 21% 21% 21% ft
Utftoa 36 137 4% 4% 4%
UtaTton 016 19 69 23% 22% 2%
Utata a a 16% 18% 16% ft
UfefadA 03? B 2 18% 18% 18%
LilriMyMr 020 17 4 43 42 43 *1
UriwTicx 020 IB 3400 34% 33% ft
UqdBcK 044 14 1» 31% 30% 31%
Leman Gp 0104411306 42% 41% 42A
tiwto» 194062 23% 25% 25% ft
IMS 17 41S 16% 15% 16% ft
LTCCp 44514 4A 04 4ft
LVUH Of* 24 Z3 45% 45% 45%
EoarVrm <» *i noo 43% *3% 43%
EBS*4 13 252 2% 2% 2%
EqtdttO* OWC3661 3% 3% 3% ft
SOMbb B 536 2% 2% 2% ft
ErlcnB 022 a 17178 27*2 26% 27% ft
toad 18 2 6% 6% 6% ft
EtmS*i 16 570 »% 20% 20% ft
E W a 1757 13% 13% 13%
Bt riM 45 K 14% 13% 14 ft
Eriddtoc 11 IS 13 12% 1299 ft
topadll 016 0 147 42% 42 42% ft
EaopAn* B « 7% 7% 7% ft
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toataeri 002 551607 46% 44% 46% ♦!%
FH»U » 5550 34% 33% 34% ft
HWThfd 104 20 052 103 62% 62%
«*» 0 262 A * A
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naM 57 1073 28% 26% 26% *1%
All An 151 13 TlBBc5D% 40% S ft
FaSttti 092 17 17S 29% 28% 29% ft
Fdlm IS 141086636% 36% 36& ft
Meant IS a 58 32U 32% 32% ft
Raenr a 1764 38% 37% 36% ft
fttoW 16 285 7% ft 7%
FWta/BTl 22 119 8% 8% ft ft
toatA 011 202549 BA 8% « ft
FoaLB 011 191640 6% 6% 8% ft
FtaatoA OI0 10 44 4 3R 3% ft
At Ad 046 18 430 27% 27% 27% ft
AtHtori 1.1812 W9 a% 30% aft
Marie* OBB 14 395 41% 38% 41% +1%
Rrisrfti OS 12 a 20% 19% 19% ft
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064 £6 10 3497 25% 34% 24%
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24% 19IWDomM OS 10 11 66 »% 20% 20%
69 90% UtMoi OS 01 27 3784 38% 97% 57%
40 32UU0XBD ZM 07 8 234 33% 32% 33
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40% 29%TCFPene 076 10 18 336 3B%- 36% 38% ft
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101% 74% TBW . ZA8 2J 12 1119 90% 90% 90% ft
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52% 3BTa*ada IS 03 35 1500 42% 42% 42% ft
15% 6% Turin 65 1108 12% 12% 12%- ft
99%34%Ttotr OS Z1 16 8617 38% 37% 37% ft
10% 6%D*ulWrr0S 04 15 10% 10% 10% ft
2% 1%TCOad 10 119 1% 01% 1% ft
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19% T4%USnfi OS 10 10 3280 19% 18% 19% ft
36%l6%iento 82 1907 34% 33%. 33% ft
29% l9%UMu 6 475 22 21% 21%
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1»80%UHAe ZS^ 1.7 19 180 13% 127% 129% +2%
17% UUcMUr 092 90 S 68 15% 16% 1ft ft
30% 14% Ootataf . 14 297 *4% 23% 24 ft
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20 17% UnteW IS 8912 SO 19% 16% 19% ft
2ft 22%UdtoOp IS 18 11 407 27% 26% Z7% ft
33% 27%uaaeri OS 22 16 5087 37% 36% 30% ft
67 54% IMUMx 1.10 17 1611S a 62% 62% ft
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47% 38% XtaCop 072 1.7 15 X 41% 41% 41% ft
26% 20% Variate? IS 5.7 11 S3 22% 22% 22% ft
53% 43%YMK OS 07 22 631 46% 4ft 48%
3% 32mri 014 19 10 33 3% 3% 3%
25% 5% MS 6 2402 13% 12% 18 ft
28% a%2toto)lritx IS 17 36 87 27% S% 27% -ft
7% 6%Mtatol 0.72100 106 7% 7 7
22% T6%2are 012 08 15 IS 10 18 16% ft
S16%2inM 040 10 S 218 25% 24% 25
11% 10%2tolBFinJ IS 90 47B 11 10% 11
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BEAU 83271 22% 21A 21% ft
B—riCna 042 24 19 12% 12% 12% ft
BateJery 14 145 12% 11% 12% ft
BrildateR OS 184764 52% 51% 61%
BHAftp ai215 SuT7% 16 17 *dk
Bine 201396 6% 6% 6% ft
Bflfl 0201221202 17A 17 17% +A
BtatoyW 00811 10 17 17 17
Brigaa 8029771 79 73 7ft -4
Etomtx 01019 2151 16% 16 16A -+A
BtarriCkg 1.18 s 6 W44U44H 4A
BHCSolto 3811427 B4% 82% B% ft
BorinwnS IS 175682u61%'60% 80tt ft
Bmennt 032 222303 12% 12% 12% ft
Bate 8 8 21 .308 31 2B% 29% -1%
Bated 10 1640 6% 5A 5A ft
Bated Tc 24 1363 16% 1ft 18% ft
AsftWA 040 18 19 23% 23% 2ft ft
BRCWdgi 60S 237 40 37% Sft
BBBtocp IS 11 S 28% 29% 25% ft
BTSNpng 046 73 A 3% 3% 8%
Buffets 121174 11% 10% lOtf -A
BtetotfT 7 58 5 64% 4%
Bar Bmn 10 76 22 21% 21% ft
feriattp 040 10 16 32% 31% 31%
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61 App 33 5 2» 2U 2ft ft
BKSare 007 20 IBB 29% 27% Sft
Bam 5 52 3% 3% ft ft
tomato i 254 % ji 048
GriteBOOO 1613274 48% 46% 47% ft
Grid Co 018 5 25 6% 8 ft ft
BadBM 044 16 8 24% 24% 24% ft
tonlffe 11 ISO 9% ft 9% ft
tonfeftl 142513 5% 4% 5% -ft
Bam* 4X0 35 US 23% 2Z% 23% ft
Oku* Inc 5 684 5% 6% 5%
Bngrete 2712060 23% 22% 22% ft
toafekCto 3 2573 7% 7 7% ft
total — 110 12 48% 44% 48% ft
QDaanft 040 6 481 15% 15% 15% ft
BWrigri. 012 41 1447 11% 11% lift ft
BtoatA 040111 213 12% 12% 12% -%
9W> Sera 86 21 7% 6% 8% -H
BkBki 1 677 11% 11 11
toedfete 19 423 7 dB% 6% ft
GaddtPrqi OS 211180 23H 22% 23% ft
fewfcsGya 7 58 3H 3% 3%
feari# 024 122354 Sift Sft
feanAP 016 10 14 9% 9% 9%
B u a arn ana 0 882 IA 1% 1J2 ft
ffllCriP 4 386 E24 5% 5% ft
ttNISq 15 342 12% 12% 12% ft
riD Cm 005 14175BB 25% 24% 25% -f %
US Cart i7 S 19% 16% 18%
Vac MB 000 » 18* 14 13% 14 ft
UadBB 11 4238 9% 8% ft *ii
U*pa&» OS 13 3» 27% 27% 27%
taf Eta Q0I 25 1444 20% 19% 20% ft
tocantp 5 te* 12% 12 12% ft
Manor 407965 14% 13% ISA -A
umarep 9 a n k n *2
ItarriiMA 04*78 127 11%d1D% 11 ft
tote OJ* 16 96* 32% 31% S%
MeriC 193324 48% 47 47% ft
UttriK 2091 7% 7% 7% ft
ktoanW 201405 X X 35% ft
McGBtovH 056 13 17 25 23% 23%
McCradMr 056 42 447 24% 24% 24% ft
Marin lac 010321068 1ft 1*% 15% ft
Mriartdna 024 14 27 6 7% ft
Marat Cp OIO 22 1450 22% 22 22% ft
MUrfi 024 17 2033 8% dB% 6% ft
MarmtoB IS 12 312 30% 29% 30% ft
Urate* 3 738 12% 12% 12% ft
Urate & 09613 no nf, 4® 4B]1 ft
ktariri 01667 ?A 2 2 A ft
Man Air B *90 ft 9% 9%
H—AfalUB 19 732 ift 18% 19% ft
MR On 2015528 50% 48% 5005 +00
MkdnriE OS 17 IS 12% 12% 12% ft
16008* 13127961)19% 19 19% ft
Mcrecan T21S55 8% 7% ft ft
Mognk a 548 8 ft 5%
Iflcrit 381 7583137% 136% 137 ft
MUMU 14 IS 10% 1ft 10% ft
Mdatella 050 47 21 16% 16% 18% ft
UfeacH 052 a 285 44% 43% 43% -%
Won 61 40 39% 39% -%
Itonricti OI0 19 S 12% 12% 12% ft
MatoaTal 83698 1ft 13% 13%
UtadanCUidia* M 23 10% 9% 9% -%
ModkwMT 068 12 309 25% S% 21% ft
MotaxA 008 22 303 33 32% 32% +%
Meta lac OS 24 279 36% 35% 35% -%
Moaccn 004 37 571 8% 8% 8% -%
MrioaaPf X0S2 X4 48 28% S 28% ft
MTSSy* 064 12 22 20% S 20% ft
Mycojao 8 184 15% 15% 15% -%
NACRe OS 9 4 34% 34% 34% ft
MariifdCtl 072 9 233 16% 1 6% TB%
tot Conpt as s Be 21% 21% 21% ft
NX* SW 013 272823 22% S 22% +1%
MMgtox 600 8 13 18 16% 18%
ICC 045 25 ' S 54% 54% 54% ft
Mere 184440 S 19 19% ft
toator 0 BOB ii A 033
toBCW 23HJ40B 45% 43 44% -1%
toritoBaa 2S2061 24,^23% Sft
touogea 51 396 21% 20% 21% ft
Newtom o 12 IA iA iA
toast Cp 00*18 7 ft 8% 8% ft
toSSCBlA 85637 16% 15% ift ft
tonrini 0J2 10 104 55% 54 55%
Ndttm OS 18 9830 36% 85% S ft
ttnriwi 18 73 17% 17 17% ft
N Stalin 9 3 7% 7% 7%
27*321 31% 30% 31% ft 13l 1B 334(169% 69 69% +%
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AMEX PRICES
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ante m*. e in* rap mcna cm
A rirMtei 16 31 15% 1ft 15% ft
Mkhc 6 385 1% 1% !.« ft
NptaU 0.05118 22S 7% 7% 7A *A
Am hr Pa IS 4 . 7 -37% 37% 37% +%.
Anted OS 33334 10% 9% 1ft
An&ptf a 336 13 12% 13 ft
AamMmA ' 95 25 4% 4% 4%
ASBtaa Z0O 7 S 2ft 19% 19%
Atttedi 13 S 4H 4% *8 ft
AutitaxA 27 124 6% SA ft ft
AubToM- 1 370 1% 1ft 1ft
AataHR 48 10 3% 3% 3%
BSMOeaan oio. 6 S 2% 2ft 2ft
SadgerMr 000 15Z100 35% 35% 35% ft
BHWTA4 004 22 92 Sft 3 3% ft
BATaO* OS 8 IS 14ft 13H T3% -ft
Bared 131 3 2% 2% 2%.
Malta 040 26 11 24% 24 24 -%
BffrtodA 10 M 25%d24% 24% -1%
Bonn 9 36 1% lft ift
Bean* OS 10 160 23 22% 23
BraacmA 1JJ4 25 133(121% 21% 21% +%
Cnrim 020 15 TO 31% 31% 81% -%
ton tore 01* 35 8 11% 11% lft ft ,
CrirfRM OOl » 4fi 4% 4% -ft
Crenbco OS 16 - 22 23% 23% 2ft
CsvTctl «7 . 45 10% 10% lft -%
CUBtotaC 93 33 IS 1% ft
Stock SW. E 100* M* LaarCMMOMg
CcocriFM 15 5 6% ft ft
CroaaATA 084 18 394 11% 11 TT% ft
CmwCA 040 1 7 13% 13% 1 3% -%
CTMOCB 040 1 79 1413% 13% -%
CUblc OS IB 16 20% 20% 20% -%
cym 3 26 10 9% 9% -%
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14 S 1ft 18% 1ft
EaabCU 0*6 32 »00 13% 13% 13% JCtorp 965 3fl 3% 3ft
Echo Bay 007 24610 8 Oft ft -A XriBkCp .15-184 3ft 3
Bad En A 032 S ffl 8% 8ft 6% *ft AbyEei OIO* 3 17% 17% 17%
Seta' Urn E MOa M* mttaeOas
HaribCtr S 3 1% tf1% 1% -ft
Hrico 010 9 17 17 17 17
HrmrinA 9 296 6ft Sft Si -%
RstrooCp 016 18 flOO lft 12% 12% ft
btCon* i0D 3881 6% eft sA ft
mno4 X X 14% 14% 14%
Nta WO 234814 ift 15% 18% ft
Jan 9*4 41 172 2ft 2% ft
JECnp 965 3fl 3% 3ft +ft
IftnXCp ,15 184 3ft 3ft
5 72 9% BA 9ft -%
IB OiOlOO 473 1 0% 10 10 -%
000 1 57 ft 8 ft +%
A 038 14 44- 46 4S 46
1.12 12 113 13% 13% 13% +%
Bate Ha 14 94 9% 9% 9% ft
Etftape S 191 15%.1ft 1ft -%
Friilrata 07018 4 26% 26% 26% -%
Has A 270 16 46 51% 51% 51% -1%
faraatLx 3.12SB S% 37% 3ft ft
Praqaancy 12 32 9% 9% ft ft
tam 080 16 2* 16% lft 16%
GtartfFdAx 076 17 205 33% 33% 33% ft
Etata 070 13 21B 13% 18% 18 ft
GokfltaU 5 1M % ft %
JferiXr 12089 % dft % -A NUMDsr
Haabrex 040 18 871 3ft 38% 36% ft 1 WTtaA .
KopEq 9 202 lft 1ft 15% ft
UtoroB 006 27 25* 6% 6% 6% ft
Lynch to 02013 8 64 60% 64
7 74 42% 41% 4ft -%
062 11 SIS 29% 29% 26%
OS 4 S 7% 7% 7%
0 794. 10 9% 9% ft
160 8% 6% 6%
I S 14 42 19% 19% 19% ft
- 12Z1S % % % -ft
• 4 35 7% 7% 7% -%
058 53 2325 36% 35% X -1
SWCntpx 222 7 4 40% 39% 40% ft
Tai) Prods OS 13 70 7% 7% 7% ft
TriStob 040 101451 35%d34% 34% -%
Tbenocdcs 33 IS 20% 20% 20%
TbwuteB 24 1121 30% 29% 30% ft
TcdPNA OSOlX 145 9% 9% 9% •%
TOam&ky 0 96 % d% %
Troon 0 93 oft % % -A
Tubes Max 51686 11% 10% 11
UUFeodaA 033 56 50 1% 1% 1% ft
UtftariB 020 80 X IB IS Iff
US torid . 18 51 29% 29% 2ft
VtapneA 1121735 32% 32% 32% ft
VtacrerB 11*6072 S S% 32% ft
IMRET T.12 17 172 12% 12% 12% ft
Xyucnri . 2 187 1% dlA ft -A
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to tan co n as S 829 17% 16% 17 ft
CaanCp 231816 ft 7% ft ft
tot** 225 1 820 5 *U 3
MMOO 51 270 15% 14% 13 ft
Cantata S 81 6% 6% 6% ^11
tote* 31 2B7 2% 2% ft ft
Canon be 0(52 25 X 96% 95% XQ -%
CMtntoi OS 10 87 40% 40% 40% ft
toaemta OS 15 13 13% 12% 13% ft
Creasy Sx aiO 16 531 1B% 17% 17% ft
Origan* S 539 8% ft 8%
CBACp 15 2 9% 9% 6%
Caterer 3722187 29% 27% 2ft +2A
CnttRd OS 13 168(05% 25 a ft
CPMSpr 9 5 17% 17% 17% -%
Chanter 13 170 5% (0% 5% ft
(Tartar 1 X 092 382799 43% 43% 43%
ante) as 31215 4% 4% 4% ft
OwddMn i 445 t) H % ft
Owteb 13 S 13% lft lft ft
Oremporaarara 28 117 5% 5% 5% ft
CnyteTa 136011 19% 16% 19A ft
Cfaxt to 6127135 23 21% 22% +1%
tore Re IS 15 299 57% 57 67% ft
CtaM to 025 X 50(09% 5ft 56% ft
Ctaa • 117 a 16% 16% 16%
Cbretoc 137146 19% Tft 19 ft
Ctaotos 44718B* 61% 56% 80% *2%
CtrBriipp 1.16 18 38101% 50% Sft ft
Ctaantor 2 IS 2% 2% 2% ft
CSQpf S 2718043% 41% 43% +1%
cocararee is s 4 40% ao 40 ft
todriVtann s 70 4ft 4
Cepreato 162248 13 12% 12% ft
Doom* S12M 31% 30% 31% +1
Coherent 152153 3B% 34% 86% +6% 1
Origan OS 4 140 20% 19% 19% ft
COM 6a* IS 10 21 2% 22% 22% -%
Conrir 024 12 587 20A » 20% ft
COreatA O0B1S1304 14% 14% 14%
CmtASp 00913*4863 14% 14% 1ft -ft
C&naritareOre 14 801 n43tt 42% 43% +%
toomnC 33 620 a 27% 27% ft
Compute 1 807 4% 4% «A +A
toreuaena 4622352 9% 0% ft ft
Cbmahria 7 779 14% 13% 14 ft
fcmtecm .10 531 13% 12% lft ft
mourn 17 in 5% US 6% ft
MUa aim 23% 22% 23% ft
COOM as 16 2752 19% 17% 1ft ft
copteta S3178 7A 7A 7% ft
ton— rtOSO 11 94 31% 30% 30% -A
Coumjto 14 3965 9% 9 3% ft
Crater B 00219339 20% 19% 20% ft
toaanscri 342*60 6% 6 ft ft
Groteto 41 40 5% 5% 5% ft
Core 35 228 U1B15A 16 ft
Cytapd 3 505 8% ft 6% ft
Q6k 11 1915 18 17% 17%
toregan 42915 5% ft 5% ft
- D-
OSCCra BB31BD 14% 1ft 13S -tft
Dart fine 013 9 2 * 94% 95 *4
Oatritax 2 321 2% d2% 2% ft
itaMreyw 13 909 17% 16% 17
EUpttfiP 120 14 634 32% 31% 32% ft
Dab&opiriUD 15 SB ft ft *A
Driototo oaa 614 39% S 39% ft
Defcriante 044 S V 21 20% 20% ft
Ml too? 2332629 82% 78 S1% fti
CH(dy - 033 17 390 42% 41% 42 -%
DepGty 10011 789100% 4ft S ft
- H -
fedbrite 35 134 7% 6% 7%
ttartaayri 00* 13 288 a 27% 27% ft
Harper Gp 021 18 377 24 23% 23% ft
HBOS Co 019 £513386 90 56% 59% +3
Heritor 213514 44% 42% 43% ft
I tatte r* 006 13 212 9% 9% 9%
Wdnltri 18 109 9 6% 8%
Hectagar 016 1 <72 ft <0% 3%
Hrirbnj 10 51 10% 10% 10%
Hatarffty 10 268 1ft 17% 1ft ft
Hartril MO 173X13 20% 10% 20% ft
Hniopta S 4894 23% 21% 23% 4-1%
Item Bari O0B 11 X 25A 24% 24% ft
Hretat 048 21 154 35% 35 35% ft
HMJBX 000121 65 15014% 14% ft
HUItete 000 13 2529 24% 23% 29% ft
IticoCa an B 144 4% 4% 4% ft
HufcNTecb 11 2*75 45 41% 44% 43%
Hfbrttfnn 3 2 ft 7% 7% ft
HyaOe» 27 8 3% 3% 3%
- I -
RlSja 16 518111ft lft 18% -1
fibril 1 297 IS 1% 1% ft
tan n e r y X 54 TlA 10% 10% ft
taaanoaa 2 S32 3% 3% 3* *A
Impart Be 027 10 216 19% 19 19% ft
tal Ha* 502096 12% 11% 12% ft
bferrata 2936516 22% 20% 22A *1i\
bfete 0* 13 352 15% X5% 15% ft
UL0t4 020 1 537 IA ii 1ft
hregrOar 67086 8% 8 8%
UgbSyt 100 974 27 S 27 ft
te—W 4 261 IA IA 1% ft
btex 000 2366017 110107%1<B% -rS
btari 22 567 1H 1H 1H ft
brigriB 040101350 9 6% 8ii -A
kterTri 18 672 15% 15 15% ft
htarkaA OS 15 3M 17 16% 16% -%
btgpb 164907 9% d8% 9% ft
name 2 618 2% ft 2%
blanks 42 5*2 B% 8% 8%
kdaneta n <736 12% 11% lft ft
UttyM 121280 a d1919% ft
fereeare 005 22 2® a 27% 27% ft
taBBito B12K6 22% 21% aft
feomefit H i 13%413% 13%
WAlado 1-tS 2T 14 200 01® 200 +1
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Jteanbe 02614 37 7 7 7 ft
JLSbd OM 19*125 19% 18 18%
JBhBWlfe r 13 13 12% 13 ft
•fate** 13 440 11410% 10% ft
JOtellM MB 78 2222 43% 40% 43* 4ft
JSBFb IS 1$ 109 36% 36% 36% ft
JDBUg 002 IS 258 15% 15% 15% ft
JMta 116 11 4<t 10% BIO 10% ft
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Ktote OCB 23 800 11 10% 10%
tarancp 04411 to/ 11% 11% 11%
Kiter» 08414 1597 28% 26% Sft ft
«*»«* 0« 15 » 36% 35% 36% ft
HAbreir 1032S 24% g% 24% ft
"» 0 * ft A
102114 Z7% 27% Z7%
KtedriS ttW 62607 13% 13 13% ft
63197 32% 31% 32% 4-1%
2157736 9% d&% 9%
62567 41% 39% 41 A +ZA
56 162 8% 6% 6%
10 4B 1% 1% 1%
- o -
OCMays <1 69 11% 11% 11% -%
Otari* 152*006 16% 15% 16 ft
OtfateA 22 99 14 13% 13% -%
OMiaLo 048 21 32291)17% 16% 18% ft
OtfabHfN IS 7 10 43% 43% *3%
Often 152 122670 32% 32% 32l a ft
OUltat IS M 52* 45% 46% 45)3 ft
OH fee as 16 49 36% 38% 36%
Orireiceip IS 12 356036% 36% 36% ft
On Men 18 361 3% 2% 3 ft
Oncta 47319® 42% 40% 42% 4-1%
OrnStnea « 1532 21% 20% 20% ft
OAatadv 099 10 496 11% 11% 11%
toagonlfct 031 31 530 31% 30% 31 ft
Ortxtet 7 464 8% 7% 6% ft
Orirep T 116 3A 3* 3A
OttkBA OS 34 78 15% 14% 15
OriteabT OS 4* 7 12% 11% 12% ft
Ottafhf IS 12 32 33 32% 32% ft
OaMOD) 484482 45% 44% 45,% ft
- P- Q-
Paccar 120010 *63 56% 66% 5ft ft
PadMtap 0*1 10 479 9 6S 9ft
PacHCraA 21 1510 67% 63% 66% 4-2
PadOaB 2210202 70% 65% 70% -ift
Pdtanabc 4« 8738 50% 48% 50% +1%
Pate**# X02* 74 1690 57% 55% 57% 4-1%
PBjmAra 36 702 l^i 13% 1® ft
Paula* OS a* X 14 13% 13% -%
Pamlfy 15 X 24% 24 24
PrewWrg IS 19 53 40% *0% 40% ft
Psnter* OS 14 2 254. 25% 25%
fWBtel 4 S 1% IA IA -A
Prerant L OS 27 S 19% 16% 19% ft
PcopfeMtrtS 19100**5% 2ft 25% ft
PacptaHt CL67 10 667 23% 22% 22% ft
Prertge 18 848 9% 9 ft ft
Pawn 7.12 SB 3 S 32% 32%
Pteanffeh 23 an 17% ib% 16JJ ft
ftqaCpAm 112991 11% 10% 11 ft
Ha— 045216 5 B% 6% B%
PiEtnfe 30 4395 3 26% 27% ft
PkxcreGp 040 35 T23 ?4 23% 23% ft
PtaH 092 2 * au66% 66% 66% ft
PtaaoS ai2 11 203 11 10% 10%
Pbta 382764 17% 15% 15% -1%
PHM» 977234 20%61B% 20% 4-1%
PUJTri 7 81 6% 66% ft
Put* OS 11 3 23% 23% 23% ft
Pare® 29 16? 10% 10% 10%
Paretos 0 679 ft 3 1
fteaUfe ttU 7 56 11% 11% 11%
PttaMC 200 741 81 76% 78% ft
PritoB 1G3BSE0 19% 18% iH ft
MfcPt* 2511091 17% 17% 17% ft
ftkririli 14 74 lft 12% 12% ft
PiWOpa 0341 818 38% a 39% ft |
OrireQn OS 87 887 14 12% 14
Otrikam 104*430 39% 38% 38% ft ,
tori Feed 020 22 192 36% 35% 38% +1 j
Otantau 104019 20% 19% 20% ft I
Grid— 13 S 21% 20% 21% 4-% j
Qubfiaa 791530 67% 84% 66% *1% |
- R -
MO* 13 176 18% 17% 18% ft
Mp 1 1232 461 4% 4% ft
Raymond 010 9 4 17% 17% 17% -%
HCSAl an 10 2S 28% 29% 28%
Rstafta 1012198 18% 16% 17% *1
flKOtan 12 434 W% AS 19% ft
ftapag* an 2 n 1|3 ft is -■«
RapteW 1227*45 31% 30% 30}i -A
merited 19 87 19% 1F| 10% ft
teaoxri 64 411 7% 7% 7% 4-%
(fetter* on a ISP 74% 73% 7%^ ft
feamCxpr OS 27 222 18% 15% 15% ft
rasnt ai2ii in 4% ft 4% ft
flwsatet 082 91106 17% 17% 17% ft
RMS OS 179915 42 40% 41% 4-%
Hcrnma a wee w 15 % 15 % ft
PPM be. x 052 172341 16% 10% 16%
HpoRte 101597 7% 7 7%-%
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Safaco IS 101915 38% 37% 37% ft
SrikMfll 42 19 39% 30% 39% ft
Sanaana OSSO 213 lft T3 13%
SdriifepArilS 18 271 21% 20% 21% 4-%
5a9yiB ««« 50*2 47% 49% *2
Seta 7 614 6A 3.77 5% ft
SEtaCp OJS 7 866 10% 09% 10
ScenfeO 1 205 3% 3 3%
SaritoU IS 27 135 3SA 35% 3SA ft
SB Cp 024 17 117 20% X 20%
SaMaB OS 8 118 2A 2% 2 A ft
S ateetB* 1.12 9 m2 3S> X 34 34% -%
Srejures 31 1*96 14% lft 14% ft
Sreiuol* 5 487 2A 2% 2ft ft
Srevlach 1 158 3 2% 3 *%
Sarenarai 022 15 2 15%tf15% 15%
Ebrita 004 a 1104 *8% *8*4 48% -%
SUTcririr 15 312 7% 7|i 7% •%
Sbonmeret is 510 19% 18% 19
SiOwbltP 36 375 18% 18 18%
9gmAJ 044 20 2843 58% 5ft +A
Sgmana 753740 7l 2 7 7% ft
SaortlBc on 11 X 26% 2S% 26%
SBenVGp 62359 17 lft 16%
Starecr 040 12 270 10% 9% B% -%
SmlbTadi I jiOO 1,», 1,'. ift ft
SBdMd 23 363 SO 2ft 29% -%
SonwaraP 0 549 ft ft ft ft
Soorm OS 121434 Sft 83% 38% ft
SpriOriA 020229 292 6% 6% 8% ♦%
Spygtaa* 44 3*59 I2%tf11% 12% +%
St JudaMd 040 2012692 39% 36% 39,'. ft
» PauSc a 048 S 303 26% 28% 29%
Statdre 3622719 16% 13% 18%
Statute! 7339935 35% 32% 32% -2%
Srilricre 51138 12% 11% 12 *%
Sari Tee OIO 12 264 13 12% 12% -%
SbddyUSA OS 010*3 2% 2% 2%
SUM 8 756 16 13% 15% ft
Stated 1.10 35212 1ft 18% 17 -2%
Sbntegb 0 571 1% 1% IA ft
SbtcDy 4435042 15% 17% 17% ft
BtaVtar 005 a 4X17 S 26% 2B|2
SriBmD 080 14 S 12 11% 12
SuatemBOBO 8 2* 25% 25% 25%
SrimkTb 116750 5% 5% 5% +24
Son Sport 2 5 1% d1% 1% -%
SunMC 2537130 81% 58% 60% +1%
SUM Ha 245 24812A3 11% lft ft
Stallra 001 27 266 22% 22% 22% ft
SytaMbC 18 T7a 17% 17% 17% ft
Symnree M2225 11% 10% 10% •%
synriky OS 12 56 lft 15% 18%
Bynate 78 2H 37% 38% aft ft
Syagfirit ai0 168934 12 11% 11% ft
syatansco 22 399 14% 14 14% ft
-T-
T-CalSc 4 383 2A 2 2
TjoareHr 00* 22 17* 34% 33% 33% -%
TBCCp 11 451 7% 0% 8% ft
TM tobta 058 193095 27% 28% 28% -%
TOGpA 4795694 12% 11% 12% ft
IWfiBto S 3240 25% 25% 25% ft
Taanreab 240 ID 40 54 53% 53% ft
TBtoteC 32 143 IS 14% 14% -%
Trintos 141928 21% 2D% 21 ft
Trial* 8110906(06% 84 85% -ft
TahmCp OOl 21 613 12% lft 12% -ft
TabuTac 241799 21% 20% 20% ft
ToreRlADA OS 275450 4ft 40% 41% +1
3Com 58445*1088% 85% 67% +1%
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11 12 73 BA 6 B
TJta* OS 13 83 S 19 19 -%
Todrwa an w «i 11 10% 10% +1
Tokyo Ha 031 1 9 2 55% 55% 55% -%
Tam Brawn 145 522 lft 18% 18% ft
TafcAtft 1273 10 «% 6% -I
TcppaCa OS 22 5027 3%(052 3}] ft
ItataHHd 3 237 8 7% 8ft
Tnnaeanl 12 85 5% 4% 5 -%
Ttata* IS 10 856 49% 4ft 4ft
Iriabta 2821922 14% 13% 14% -%
Tluarim 78 sn 3% ft ft
TrurecctecC 096 18 68 22% 22 22 -%
Hang Lab OS 32 740 6% fi% ft ft
iy*RM ai2 332152 30% 29% 29% -%
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IHfeb 2 20 » & fi
UtoteaSa IS 17 316 21% 20% 20% ft
Untetia 0*0-12 4 2ft 2ft 22% ft
Untag tt12 21 340 27% 2B% 27% ft
IMMi ZS 15 10 52 51% 52 ft
IB Bare* IS IB 1599 40% 39% 39H +A
US Energy 782 84 15% 15% 15% -%
USTfebet 3079760 98% 61% 62% -3%
USSm* 4 205 3% ft 3% ft
U6 Tat 1 IS IB 172 an 82% 82% ft
USTQxp OS 14 370 18 17% 17H ft
UabMad OS 13 355 13% 12% 13 ft
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totena a 67 33% 83% 33% -%
tour S 954 1ft 18 lft ft
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toreriglc 461030 0% ft 8%
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-w-
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IfcrarEn 009 17 31 17% 17% 17%
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tonakalA OS 12 Z10Q 21% 21% 71%
tonaumos 17 2* 19% 1919% ft
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WSSariA 34 664 31% 31 31 ft
llffeiitb 104 121721 67% 68% 87% +1
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WORLD STOCK MARKETS
Dow flat as
tech stocks
move higher
* FINANCIAL TIMES Friday November 1 1996
Accolade, then Pharmacia takes a beating
AMERICAS
Most US share indices were
flat in mid-session trading,
although the technology sec-
tor continued to show
strength on the heels of the
declines seen in the early
part of this month, writes
Lisa Bransten in New York.
At 1 pm. Don Jones Indus-
trial Average was 1.12 higher
NYSE volume
Daify [munonj
500
Average daily
vokrrm 1395
34S.135.000
IB 21 22 S3 24 25 SS 29 3031
Oct 1996
at 5,994.33, the Standard &
Poor's 500 rose 0.40 at 701.30.
and the American Stock
Exchange composite added
1.62 at 566J91. Volume on the
NYSE came to 267m shares.
Bonds provided support
for shares, firming in morn-
ing trading ahead of today's
figures on October employ-
ment business activity.
Technology shares were
one area of relative strength.
The technology-rich Nasdaq
composite advanced 5.78 at
L212.01 and the Pacific Stock
Exchange technology index
was 0.6 per cent stronger.
All of the four largest com-
panies on the Nasdaq posted
gains, although there were
losses among some of the
more volatile Internet-re-
lated companies. Netscape
Mexico rebounds
MEXICO CITY rebounded
after an initial slide. It was
almost 1 per cent ahead by
mid-session as buyers
returned to snap up stocks
that were thought to have
been hit too hard in Wednes-
day's tumble.
The IPC index was up
31.00 by mid-session at
3,193.49.
In a rebounding construc-
tion sector, Tribasa headed
the gainers with a 1 peso rise
to 18.50 pesos while Geo rose
1.50 pesos to 35.00 pesos.
SAO PAULO was lower as
Investors awaited details of
an airliner crash in a
densely populated area of
the city. The aircraft, oper-
ated by Brazil's TAM airline,
was reported to have been
carrying at least eight execu-
tives of the Unibanco private
bank. TAM preferred shares
tumbled 24.1 per cent and
the Bovespa index was 578
down at &L584.
CARACAS fell 2.2 per cent
on profit-taking in spite of
Wednesday’s approval of the
privatisation law reform bill
which opened the way to
next month's CANTV share
offering. The IBC index was
130.82 weaker by mid-session
at 5,876.90.
Rand helps S Africa ahead
A tururound In the rand,
which rebounded from fresh
morning lows against the
dollar, provoked an ava-
lanche of support in Johan-
nesburg for rand hedge
stocks and quality blue
chips stocks.
Industrial shares were
higher, helped by the firmer
currency, while golds,
regarded as oversold, moved
ahead in spite of a weak bul-
lion price and a softer rand
gold price.
The overall index ended
83.5 up at 6.975.3, industri-
als gained 84.5 to 8,209.2
and golds rose 24.2 to
1,732.3.
Industrial shares led the
improvement with some
stocks quickly regaining
ground lost daring the mar-
ket's rand-inspired decline
on Monday and Tuesday.
The banking sector also
found favour. Standard
Bank regained the R5 lost
on Tuesday, rebounding to
R180. Nedcor jumped R3 to
R68.00 while First National
edged up a more modest 5
cents to R25.75.
Anglo American was tar-
geted by futures arbitra-
geurs, gaining R3.25 to
R282.20. while fellow min-
ing heavyweight De Beers
rose R2.50 to RI38-50.
Communications, which
makes Internet software, lost
52%, or 5 per cent, at $44, US
Robotics, a computer modem
manufacturer, shed S2%. or 4
per cent, at $68% and C/net.
an Internet content com-
pany. fell by $ 1 %, or 8 per
cent, to $15%.
Elsewhere, The Gap rose
$1%, or 5 per cent, to $28%
after announcing that its
board of directors had
approved a buy-back of up to
30m shares over the next
three years.
Pharmacia & Upjohn fell
$2%. or 6 per cent, to $35%
after it reported third-quar-
ter earnings were even with
the period a year ago, and
warned 1997 profits would be
about 10 cents a share below
expectations.
Meanwhile, Centocor. the
US biotechnology company,
added $2, or 7 per cent, at
$28% after reporting a loss of
2 cents a share, a cent less
than analysts had expected.
Shares in the company had
fallen nearly $10 since the
start of the month as inves-
tors anticipated poor results
from the company.
TORONTO was firm at
mid-session with the TSE-300
composite index 5.17 higher
by noon at 5,595.98 in vol-
ume of 52.7m shares.
Bre-X Minerals fell for the
third straight day, down 45
cents to C$21.95 as Indones-
ia’s director general of min-
ing was reported as saying
that his government was
still withholding contracts of
work related to the Busang
gold find.
Molson picked up 5 cents
to C$20.15. Its 40 per cent
owned Molson Breweries
reached an interim agree-
ment with Coors Brewing
over the licensing of Coors
products in Canada.
It was a quiet day for most
bourses, but individual com-
panies were rewarded for
performance or punished, in
some cases severely, for dis-
appointing the pundits. In
one case, that of Pharm-
acia & Upjohn, a morning
accolade was followed by an
aftern oon b eating.
STOCKHOLM, originally,
said that Pharmacia, the
SwedishfUS drugs group,
had reassured the market,
posting earning s in line with
expectations after a profit
warning which produced a
severe drop in the share
price about three weeks ago.
There was a parallel story
linking the group's doxorubi-
cin bladder cancer drug with
a possible BSE treatment
and the shares hit SKr251.
up SKr8 at best
However, an analysts' con-
ference call seemed to
change the mood. Mr John
Reeve of Paribas said that
owing to a smaller contribu-
tion from currency earnings
this year, he had trimmed
his gamings forecast for the
group from US$2 JO a share
to $1.90. The shares ended
SKr 13.60 lower at SKr229.50.
One beneficiary of all this
was Astra, the other big
Swedish drugs group, whose
A shares rose SKr5 to
SKr302, most of this In the
Pharmacia &- Upjohn
Share price (SKr) ■
zsi —
last 10 minutes of trade.
With Volvo B reflecting a
better feeling about car-
makers and SKriL5G higher
at SKrl36.50, the Affars-
vftrlden General index rase
8.6 to 2,139.3.
PARIS put up the best
senior bourse showing after
French bonds responded to a
combination of a record Sep-
tember unemployment rate
of 12.6 per cent, a 5 basis
point intervention rate cut
and European Union accep-
tance of the French govern-
ment's plan to use a special
France T616com dividend
towards reducing its 1997
public deficit.
The CAC-40 index rose
15.75 to 2,140.51 in turnover
of FFr725bn. The big index
winner was LagardSre. up
FFr6 to FFr161. 50 for a
two-day gain of 7 per cent as
worries over its Thomson
acquisition subsided. Among
the losers, Euro Disney shed
50 centimes, or 4.7 per cent,
to FFr10.05 ahead of its
results on November 14.
Elsewhere, LVMH rose
another FFr28 to FFr 1.171
following Wednesday's bid
for a majority in DFS of the
US and Roussel-Uclaf closed
FFr25 higher at FFrl^353 on
reports that Hoechst, its Ger-
man parent, might buy out
the minority at FFn.600 a
share.
FRANKFURT improved a
little in the afternoon,
encouraged by gentle recov-
eries in the dollar, bunds
and the Dow, The Dax index,
after an Intraday low of
2,655.96, closed 6.68 higher at
an Ibis-indicated 2,671.40.
The automotive sector was
mixed, with the truckmaker
and engineer MAN down
another DM5 to DM371 on
the problems at its end of
the industry.
However. Volkswagen,
named by Merrill Lynch as
its Global Focus One stock,
rose DM5.80 to DM603.S0
after Wednesday's DM4.50
gain.
A former favourite was
not so fortunate. SAP, the
computer software major
which slumped following a
profit warning last week.
FTSE Actuaries Share indices
Oct 31 THE EUROPEAN SERIES
Haoiy flanges Open 1030 11.00 1200 13.00 1400 1S0Q CMe
FTSE BmSaft 100 175040 1745.45 17 47 .28 1748.02 1747J0 174057 174730 1747.44
FTSSeumCraBtaW 180058 180047 1803.83 18043Z 1804,45 150S82 180017 1606.77
Oct 30 Oct 28 tttffl 0025 03 24
FTSE EMM* 100 1754S7 175014 1775.01 176058 1772.46
FTSE Euranek 200 1811 JJ5 1812.44 183223 1621.87 182024
Bex ota lOttQMOHfc WMn HD - 173087; 309- 1007S7UH«r HO - 174LB1 200- 18010. T ML
c Fro mwana uom whiom kwh*
dropped through the DM200
level, the preference shares
shedding DM6.50 at
DM198.40, down more than
30 per cent from Its 1996
peak in less than a fortnight
ZURICH featured a turbu-
lent ride by Swissair. The
shares jumped to an early
high of SFr 1,008 as Sabena
said that it had reached a
provisional pay and condi-
tions agreement with its
trades unions, but pulled
back to SFr9S0 as the Bel-
gian airline's pilots staged a
short-lived strike In protest.
By the close. Swissair was
SFrl weaker at SFr985 as the
market absorbed comments
by Sabena's chief executive
that the Swiss flag carrier
might write off its 49.5 per
cent stake in the Belgian air-
line. Swissair said that no
decision would be made
before the end of this year.
The broad market made
little progress and the SMI
inripy closed just 2.2 higher
at 3,725.3.
. Sulzer, the technology
company, closed SFr 12
higher at SFr670 as Investors
took the planned spin-off of
its Elma Electronic subsid-
iary as a sign that the com-
pany was willing to restruc-
ture its operations.
Adecco, an outperfonner
since last week's strong prof-
its from Manpower in the
US. gave up SFrll to SFr355.
Among second-liners, Stra-
tec put on SFr65 to SFrl, 645.
UBS, which initiated cover-
age of the stock with a posi-
tive recommendation, said
that it was one of a small
group of medical technology
companies distinguished by
powerful sales and profit
growth.
MILAN was lifted at the
close by strength in the lira
and bonds. The Comit Index
eased 1-28 to 603.85, but the
real-time Mibtel index fin-
ished 38 higher at 9,626.
Tim. the cellular telephone
company, rose L90 to L3.128,
encouraged by nine-month
results and news that it was
to buy a 49 per cent stake in
Stet Mobile Holding, which
provided a potential foothold
in France.
Stet slipped L43 to L5.259
following reports that its
managing director, Mr
Ernesto Pascale. was under
Investigation In a corruption
inquiry.
Eni, the energy company,
accounted for almost 25 per
cent market's trading vol-
ume, edging down L5 to
L7.256.
AMSTERDAM seesawed
near the close, ending with
the AEX index Just 0.07
lower at 577.02. Royal Dutch
was a weakening influence,
the shares falling FI 5.80 to
FI 280.20 after third-quarter
results which were seen as
disappointing.
There were no apparent
surprises from the paper,
office supplies and printing
equipment group KNP BT.
but a third-quarter profits
decline still left the shares
down 60 cents at FI 37.40.
ISTANBUL fell 2 per cent
on profit-taking In state-
owned companies and the
energy sector, and the IMKB-
100 index finished 1.686
weaker at 82,006 after reach-
ing an all-time intraday high
of 85,753 during the morning.
Written aid edited by WHBam
Cochrane and Michael Morgan
Nikkei takes its losses into third straight day
ASIA PACIFIC
A bout of Index selling just
before the close extended
TOKYO'S losing streak to a
third day with the Nikkei
average breaking down
through the 20,500 level,
writes Gwen Robinson.
The 225 index fell 214.81 to
20,466.86 after moving
between 20,449.99 and
20.738.57. The broader Topix
index of all first-section
stocks declined 12.33 to
1,550.55 and the capital-
weighted Nikkei 300 lost 2.64
to 290.44.
Volume rose 252m shares
to an estimated 280m.
Declines led advances by 748
to 308 with 171 unchanged
and, in London, the ISE /Nik-
kei 50 index rose 2.87 to
1,410.81.
Traders noted continued
selling of blue chips by for-
eign investors, particularly
high-tech issues, on con-
cerns that the recent
strength of the dollar against
the yen would hurt their
yen-denominated assets.
The forthcoming long
weekend in Japan, where
markets will be closed next
Monday, also dampened
investor activity. However,
analysts argued that the
main factor in Thursday's
drop in stocks, a late-after-
noon surge in futures-led
selling, did not reflect senti-
ment. Investors, assured of
continuing low interest
rates, were continuing to
redirect their funds toward
thp booming bond market.
The slow trading, the pro-
fessionals added, was due
mainly to uncertainty over
the domestic political situa-
tion and the US presidential
election next week. The
LDP, which emerged as the
dominant party from the
October 20 general election,
is trying to cobble together a
coalition before an expected
parliamentary session next
week to confirm the prime
minister.
Most Industry sectors lost
ground On the broad range
of index-linked selling.
StA foreign
Shan' price & index (rebased)
120 — : — ■— 1 — :
1 SUIon** ..
Straits Times
Industrial
Jan -1SBS
faro* Os UH i us i 'n ;
Among technology stocks.
TDK lost Y70 to Y6.680. Mit-
subishi Electric fell Yll to
Y659 after a 1996 intraday
low of Y655, Okl Electric fell
Y8 to Y634 and Fanuc, which
lost Y15Q to Y3.650, also
marked new lows for the
year at Y633 and Y3.620
respectively.
Japan Airlines and All
Nippon Airways both ended
at their 1996 lows. JAL.
which had just announced
poor first-half earnings
results, fell Y30 to Y650.
while ANA declined Y12 to
Y949. Selling also hit car-
makers, Toyota falling Y40
to Y2.690 and Suzuki closing
at its low for the year, down
Y30 at Y1.160.
In Osaka, the OSE average
dropped 124.59 to 2L236.65 in
volume of 23.97m shares.
MANILA rose 1.3 per cent,
lifted by bargain hunting in
blue chips with good nine-
month earnings. The com-
posite index rose 36.70 to
2JH54.00. Ayala Land, which
reported a 34 per cent rise in
nine-month profits, saw its B
shares 50 centavos higher at
28 pesos.
Other winners included
San Miguel and Petron, up 1
peso to 47.50 pesos and 20
centavos to 7.70 pesos
respectively. Turnover was
heavy at 3.6bn pesos,
prompting some analysts to
say that foreign Investors
might have returned.
KUALA LUMPUR'S blue
FT/SAP ACTUARIES WORLD INDICES
Ttvo FT'S&P Actuaries World imfices am owned by FTSE International Limited, Goldman. Sachs & Co. and Standard & Poor's. Tin Indices ore compiled by FTSE
intCTTMiionji and standard & Poor's In conjunction with the Faculty of Actuaries and the Institute of Actuaries. MatWest Securities Ltd. was a co-founder of the Indices.
NATIONAL AND
REGIONAL MARKETS ■ WEDNESDAY OCTOBER 30 1BB6 — TUESDAY OCTOBER 29 1096 DOLLAR INDEX
REGIONAL MARKETS
Figures m parentheses
Airttiawi |7fl» . ..
Austria <241
Belgium |27»
Braid i?81.
Canada 016)
Pwunari* f30i
Fi/d.wd i?3>
f ranee i*J3l
Gnimory (Mi
Hong K<x\g i09l
indorcSKi <2?i
Irctano PCt
Italy |5S1
Japan IJEtOi
Malaysia (lOr>
i27)
NemeHand <161
Now ZiMland »i5i
Norway (35)
PMippwra iCT)
Singapore 1431
South Africa (44).
Spa-n OH . _
Snooon |48i
Switrertand |37)
Thailand i4Sl
United Kingdom (213) ...
USA <tJ3)
Americas t.TMJ
Eitfwpe (7iBi
Nordic (1361
Pacific Basin i876) . .
Euro- Pacific |1594)
North Aiwnco (739]
Europe £*. UK (505). ..
Paata Ex. Japan (3961 ..
World Ex. US H609)
world E." UK 12219)
World Ex Japan (1952).
us
Dotar
Index
Day’s Pound
Change Sterling
% Index
Yon
Index
DM
Index
Local Local
Currency *6 chg
Index on dav
Grass
Div.
Yield
US
Dollar :
index
Pound
Sterling
Index
311.98
0.6
192.53
152.59
186.11
178.06
as
4.27
210.77
194.08
....180.36
on
163.83
129.85
141 J5
141.27
-0.2
T.99
18035
188.07
. 221.00
on
200.72
150.00
173.18
160.34
-02
3.94
220.93
203.44
. 182.77
-0 1
166 00
131.57
14&23
345.72
-02
1.77
183.03
168.54
. 1B1 94
0.B
165.24
130.07
142.57
178.71
0.5
2.04
1B0.53
16024
332 70
0.3
302.16
239.49
260.71
261.77
-0.1
1.76
331.71
30S45
. 217 06
-0.1
197.14
156.25
170.09
205.47
-0.4
2.43
217.30
200.10
...J0 1.36
0.3
18388
144.95
157.79
160.83
0.0
3.02
200.71
184.82
. . 181.53
0.4
184.87
130.67
142.25
142.25
0.2
1.74
180.79
188.46
463 79
1.7
421.23
333.BG
363.44
460.40
1.6
3.32
45024
420.12
....203.79
o.a
(85.09
146.70
159.70
291.04
0.0
1.73
203.86
107.72
..313.41
0.5
284.64
225.61
245.59
260.73
-0.3
3.33
312.01
26731
.. .75.44
-1J
68.52
54.31
59.12
8535
-1.3
2.43
7635
70J0
. .. 13 a.ee
-05
125.94
99.82
108.68
99.82
-0.6
0.77
13939
128.26
...674.70
-0.5
521.96
413.69
491.35
559/43
00
1.18
577.31
531.60
1141.92
-1.8
1037.12
822.01
804.83
9950.63
-1.1
1.38
1162.57 1070-53
...310.6?
-0.5
282.11
223.60
243.41
239.76
-0.7
3.08
312.03
28733
90.10
0.3
81.84
64.86
70.61
67.79
405
89.79
82.68
. ..265.37
0.3
241.02
191.03
207.95
229.38
-0.1
2-21
264.69
243.74
...184.39
1.4
167.47
132.73
144.49
241.53
1/4
0.60
101.85
167/45
.385.70
1.2
349.85
277.29
301.85
249.04
O.a
1.07
380.73
35a66
..33617
-05
396-23
234.79
255.59
337.95
0.7
2 27
327.68
301.74
...187.65
-0.7
170.43
135.08
747.05
780.75
-0.8
325
188.95
17329
390.36
- 0.9
354 54
281.00
305 89
378.48
-1.0
226
393.93
362.74
..344.16
0.3
221.78
175.70
191.33
189.12
-02
IJjfi
243.43
224.16
..113.53
-2.2
10251
81.01
68.18
111.37
-2-2
3.08
115.03
1Q5J13
. 260.70
0.7
236.B4
T87.72
204.35
236.84
-0.7
3£8
2S&99
238 AB
.. 384 83
-0.1
258.69
205.03
223.20
284.83
-O.i
2.00
285.00
28243
360 85
o.a
23091
187.77
204.41
219.27
00
2.08
280S4
24028
• CJ4.19
0.2
203.61
181.38
175.68
10T.14
-0.5
3.00
223.68
205.97
,...333.70
-0.5
303.07
240.21
261.49
26422
-0.7
2.20
335J17
30&B2
.154 69
-0J3
14049
111.35
121.22
112.38
-02
1.25
154.97
142.70
...183 53
0.0
166.69
132.11
143.B3
142.07
-0.4
2.14
183.48
168.90
...J7B.7C
o.a
253.14
200.83
218.41
277.75
on
2.09
278.76
256.70
...19983
0.0
181.49
143.85
156.59
184.43
-0.3
2.42
199.92
18409
,.r95 7S
0.9
20S.62
212.90
231.77
255.46
04
2A1
293^4
27030
. .185.45
a.o
168.43
133.50
145.33
147.19
-0.3
2.13
IBS 39
170.71
. .Jftr.IKJ
-a i
192.84
152.84
166.33
1B1.77
-0.2
1.91
212.50
195.68
. -257.78
0 1
334.12
105.56
202.00
243.21
-0.1
2.45
257.51
237.12
. .216.48
0.0
196.81
155.83
169.64
186.76
-02
2.11
21649
199.35
TUESDAY OCTOBER 29 1996
Pound Local
177.17
141.51
160.66
346J7
175.86
281.96
206-35
160-80
141-95
4SSL91
291.14
270.69
88.50
10048
559.19
10081.31 ‘
241.34
67.59
229.49
238.16
247.91
335.73
182.25
382.15
168/48
113.91
23&49
2B5.00
' DOLLAR INDEX ■
Yee
chip stocks moved up
shaiply at the close, leaving
the composite index 7.57
higher at 1168.31. Tenaga
picked up 30 cents to
M$1 0.10, p ulling the index up
with it
Sime UEP, the property
developer, added 30 cents to
MS6.05. off a high of M$7.05
as Investors turned their
attention back to the
recently neglected sector.
Proton rose 20 cents to
SS7.35 on news that it had
bought a controlling stake in
Lotus, the British sports car
maker.
KARACHI climbed on
news that the International
Monetary Fund planned to
resume payments of a stalled
standby loan to Pakistan.
Late profit-taking cut the
gains, hut the KSE 100 index
closed 10.61 higher at
1,455.85. after 1.469.61.
COLOMBO closed higher
on small investor specula-
tion that next Wednesday's
budget would be market-
friendly. The all-share index
put on 4.58 to 608.48.
Commercial Bank rose
SRs8 to SRsllO and Hatton
National Bank by SRslO to
SRs235.
SINGAPORE featured a
tumble in foreign shares of
Singapore Airlines to their
lowest for almost a year on
selling by overseas funds
after downbeat comments by
the chief executive.
The foreign shares, most
widely followed by fund
managers, lost 20 cents at
S$ 12.40, taking their losses
since Monday's poor half-
year results to SSI .60.
Singapore Telecom rose 14
cents to S53.2S on rumours
that its weighting in key
regional indices might be
increased. The Straits Times
Industrial index was 0.79
easier at 2,08323.
HONG KONG was caught
between optimism after
Wednesday's surge in prices
and caution ahead of fresh
US economic data. The Hang
Seng index finished 72.09
higher at 12,477.56 In turn-
over that eased to HK$6.3bn.
Property stocks were the
strongest performers.
Cheung Kong rose HK$1 to
HKS62. SHK Properties
gained 75 cents to HKS88 and
New World Development
advanced 70 cents to HK$45.
SmarTone Telecommuni-
cations Holdings, the mobile
telephone operator which
made its debut, closed at
HK51&50, compared with its
HK817.25 issue price.
SHANGHAI’S hard cur-
rency B share index ended at
a record closing low on
heavy selling by foreign
investors disillusioned by
poor corporate performances
and Beijing's repeated reaf-
firmation of a ban on domes-
tic investors trading the B
shares. The index fell 0.226
to 47.077 points, below the
previous record closing low
of 47.13 points on June 7.
DHAKA soared in a fur-
ther celebration of its own
illiquidity. The DSE index
rose 162.67 or 5.8 per cent to
2,986.29. It has now climbed
more than 50 per cent since
mid-October and has almost
quadrupled over the past six
months.
Tho Wan Indm tMafl... .216.46 0.0 196.61 155.63 169.64 186.76 -C
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