首都圏の高齢者人口、15年に1000万人超 08年度首都圏白書

首都圏の高齢者人口、15年に1000万人超　08年度首都圏白書

　国土交通省が22日まとめた2008年度の「首都圏白書」は、関東8都県の65歳以上の高齢者人口が15年には1000万人を超えるとの見通しを示した。05年からの伸び率は42％と全国平均より11ポイントも高い。高度成長期に首都圏郊外の新興住宅地などに居住した「団塊の世代」の高齢化が本格化する。

　金子一義国土交通相が同日の閣議に提出した白書は、国立社会保障・人口問題研究所の「日本の市町村別将来推計人口」を基に、05年に761万人だった8都県（東京、神奈川、埼玉、千葉、山梨、群馬、栃木、茨城）の高齢者人口が15年に1078万人に達すると推計した。

　この結果、15年の8都県の推計人口（4286万人）の4人に1人が高齢者となる。

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鉄鉱石、値下げへ　35％軸に新日鉄とリオが調整

　新日本製鉄など鉄鋼大手と英豪系リオ・ティントなど資源大手は、2009年度の鉄鉱石価格を08年度から35％前後値下げする方向で最終調整に入った。鉄鉱石の値下げは7年ぶり。鉄鋼業界の負担は前年度に比べ2000億―3000億円程度減るとみられる。原料用石炭（原料炭）は約6割値下げで決着しており、自動車用鋼材など幅広い最終製品の値下げにつながる可能性がある。

　日本の鉄鉱石輸入量の6割を豪州産が占める。豪英系資源大手のＢＨＰビリトンなども同様の水準で追随する見通しだ。(10:06)

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サウジでの発電・造水事業、住商が計画を断念

　住友商事はサウジアラビアで交渉を進めていた発電・造水プロジェクトの事業化を断念した。総事業費が約5500億円にのぼる大型案件で、2008年夏の入札ではマレーシアの発電事業会社などと共同で落札していた。サウジ政府はプラントの建設・運営を政府事業にする方針へ転換し、住商らとの交渉を白紙に戻した。

　当初はサウジ政府が40％、住商、マレーシア企業、現地財閥が各20％を出資して官民共同の事業会社を設立。石油火力発電所と海水淡水化設備を組み合わせた大型プラントを建設し、運営まで手掛ける計画だった。(07:00)

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日販・トーハン　返本削減へ対策強化　書店の販売努力促す

　出版取次大手は書店からの本の返品を減らす対策を強化する。日本出版販売は返品をあらかじめ定めた率以内に抑えた書店に報奨金を出すほか、トーハンも返品率目標を守ることを条件に配本量を保証する対象品を増やす。書店側の安易な発注を抑える一方で、仕入れた本を着実に売る書店に対しては手厚く書籍を配る。取引制度の見直しで書店側の販売努力を促し、市場縮小に歯止めをかけたい考えだ。

　日販は近く中堅クラスの書店チェーンや地域で1番売り上げ規模の大きい書店を対象とした報奨金制度を設ける。雑誌や単行本など20分野前後を対象に、返品率の改善目標や販売目標を設定し、達成すると日販が書店に報奨金を出す。(07:00)

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Dollar Slides to 4-Month Low Versus Euro on U.S. Credit Concern
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By Theresa Barraclough and Ron Harui

May 22 (Bloomberg) -- The dollar fell to a four-month low against the euro and weakened versus the yen on speculation the U.S. may lose its AAA credit rating.

The yen rose to a nine-week high versus the dollar after Japan’s Finance Minister Kaoru Yosano said the government won’t intervene in the currency market and the Bank of Japan raised its economic assessment. The dollar headed for its biggest weekly drop in two months versus the euro after Standard & Poor’s yesterday cut its outlook on the U.K.’s AAA credit rating, and Pacific Investment Management Co.’s Bill Gross said the same will happen to the U.S. “eventually.”

“Dollar sentiment is particularly bad,” said Sean Callow, a senior foreign-exchange strategist in Sydney at Westpac Banking Corp., Australia’s biggest lender by market value. “A lot of Treasuries are held by foreign investors and any concern about the value of U.S. debt will have a massive impact” on the U.S. currency.

The dollar declined to $1.3912 per euro as of 7:03 a.m. in London, after dropping to $1.3955, the weakest since Jan. 5. The U.S. currency has slumped 3 percent this week, heading for the biggest loss since the five days to March 20.

The yen rose to 94.21 per dollar, after reaching 93.87, the strongest level since March 19. Japan’s currency is heading for a 1.1 percent gain this week. The yen traded at 131.07 versus the euro from 131.15. Norway’s krone advanced 0.6 percent to 6.352 per dollar, the biggest gain among major currencies versus the greenback.

British Pound

The pound traded at $1.5852 from $1.5844 yesterday after earlier climbing to $1.5897, the highest since Nov. 6. The currency slumped as much as 1.5 percent yesterday after S&P lowered its rating outlook to “negative” from “stable,” and said the nation faces a one in three chance of a rating cut.

The dollar weakened versus 12 of the 16 most-traded currencies after U.S. Treasury yields rose the most in two weeks yesterday on concern the government will not be able to fund its fiscal spending, and as BankUnited Financial Corp. became the biggest U.S. bank to collapse this year.

The cost to protect buyers of U.S. sovereign bonds for five years climbed to a two-week high, indicating a worsening perception of the nation’s credit quality. U.S. credit-default swaps rose to 37.745 yesterday, the highest since May 4, from 34 on May 20, according to CMA DataVision. The five-year CDS price for Japan fell to 50 from 50.06 on May 20.

‘Unsafe’

BankUnited was in an “unsafe condition” and the quality of its loan portfolio had deteriorated, the Office of Thrift Supervision, the lender’s main regulator, said yesterday. BankUnited joined 33 U.S. banks and at least five credit unions that have gone under since January.

“The urgency for money managers with large U.S. dollar holdings to diversify could well intensify,” analysts led by Callum Henderson, global head of currency strategy in Singapore at Standard Chartered Bank, wrote in a note today. “The first considerations will likely be hard currencies that are liquid. On these counts, the likes of the euro, yen, Australian dollar and Canadian dollar will win out.”

The dollar touched a four-month low of 1.0895 Swiss francs before trading at 1.0920 from 1.0936 yesterday. The U.S. currency fell to C$1.1349 from C$1.1374, after reaching C$1.1328, the weakest since Oct. 14.

Bill Gross

The U.S. currency also fell for a fifth day versus the euro after Gross, the co-chief investment officer at Pimco, said the U.S. will “eventually” lose its AAA rating.

“The markets are beginning to anticipate the possibility” of a U.S. credit rating-cut, Newport Beach, California-based Gross said in an interview yesterday on Bloomberg Television. “It’s certainly nothing that’s going to happen overnight.”

The administration of President Barack Obama will sell a record $3.25 trillion of debt in the fiscal year ending Sept. 30, according to Goldman Sachs Group Inc. Treasury Secretary Timothy Geithner said yesterday the Obama administration is committed to minimizing the federal budget deficit, targeting a reduction to 3 percent of gross domestic product or smaller, compared with a projected 12.9 percent this year.

The Dollar Index, used by the ICE to track the U.S. currency versus the euro, yen, pound, Swiss franc, Canadian dollar and Swedish krona, declined 0.1 percent to 80.433 after dropping to 80.21, the lowest since Dec. 29.

Indian Rupee

India’s rupee headed for the biggest weekly advance in 13 years on optimism Prime Minister Manmohan Singh, armed with a fresh mandate, will revive efforts to sell state assets and attract foreign investment.

The currency gained 0.4 percent to 47.18, extending its gains this week to 4.7 percent, heading for its best weekly rally since March 1996

The yen strengthened versus 12 of the 16 most-traded currencies as the Bank of Japan kept its target lending rate at 0.1 percent at the end of its policy meeting today and raised its economic assessment for the first time since July 2006. The central bank also said it will accept foreign debt owned by banks as collateral for loans.

The yen headed for a thirdly weekly gain versus the greenback after Japan’s Finance Minister Yosano said the “government isn’t considering currency intervention at this point.” Policy makers haven’t fully analyzed why the yen is gaining, he said at a press conference today in Tokyo.

“We are seeing the appreciation of the yen, but mainly because of the negative views on the U.S. economy,” said Susumu Kato, chief economist in Tokyo at Calyon Securities, the investment banking unit of Credit Agricole SA. “It would be hard for the Japanese government to change the direction of the market because it’s more of a dollar-weakness issue rather than a yen-strength issue.”

Central banks intervene when they buy or sell currencies to influence exchange rates.

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Brazil May Boost Dollar Purchases, Standard Chartered Says
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By Renato Andrade

May 22 (Bloomberg) -- Brazilian central bank President Henrique Meirelles’s warning yesterday against an “excess of euphoria” in the currency market may foreshadow bigger dollar purchases by policy makers to curb the real’s three-month rally, according to Standard Chartered Plc.

The central bank began buying dollars on May 8, initiating “step one” in its bid to temper the real’s advance to a seven- month high, said Mike Moran, a currency strategist at Standard Chartered, which gets most of its revenue from developing nations. Meirelles’s comments yesterday were “step two -- upgrade the level of verbal intervention.”

“And step three is clearly much more aggressive interventions,” Moran said in a phone interview from New York. He predicts the currency will gain to 1.9 per dollar by year-end from 2.0311 yesterday.

The real has climbed 20.5 percent since March 2, the biggest advance among the six most-traded currencies in Latin America, as prices on the country’s commodity exports rebounded and investor demand for emerging-market assets picked up.

It’s up 14 percent this year, more than all 16 major currencies except for South Africa’s rand, in a reversal of the 33 percent plunge in the last five months of 2008. The UBS Bloomberg CMCI Commodity Index rose 21 percent since March 2.

Meirelles told reporters in Brasilia yesterday that he’s worried that investors may have become too bullish on the strength of the recovery in Latin America’s biggest economy after the slowdown late last year. Growth dropped to 1.3 percent in the fourth quarter from 6.8 percent in the third quarter as the global financial crisis deepened.

‘Great Speed’

“The market looks to anticipate and when a consensus starts to form, it moves at great speed,” Meirelles said. “Investors and companies have in the past suffered big losses because of an excess of euphoria. We have alerted them to this risk.”

Sadia SA, the poultry exporter that was acquired by rival Perdigao SA this week, booked more than 3 billion reais of expenses related to derivatives in the second half. Votorantim Participacoes SA, a closely held producer of materials from aluminum to cement, spent 2.2 billion reais to settle wrong-way bets on currency derivatives last year.

Moran said Meirelles’s statements were “an escalation of the existing policy” after the central bank bought “very small” amounts of dollars in the foreign exchange market in recent days.

Reginaldo Galhardo, currency-trading manager at Treviso Corretora de Cambio in Sao Paulo, estimates the central bank purchased about $150 million a day from May 8 to May 19.

2 Per Dollar

Galhardo and Luiz Roberto Monteiro, currency manager at Sao Paulo-based Corretora Souza Barros, said policy makers stepped up those purchases to more than $1 billion on May 20. The central bank doesn’t disclose the amounts it buys or sells in the currency market.

The purchases are the first in eight months. The central bank halted them in September amid the global crisis and began to sell dollars. The country’s foreign reserves totaled $203.7 billion as of May 20, down 2.6 percent from a record high set on Dec. 17.

Roberto Padovani, chief Brazil economist at Banco WestLB, said the timing of the dollar purchases -- just as the real was approaching 2 per dollar -- has created speculation that policy makers were looking to prevent the real from breaking that level.

“Every time the currency approaches 2 per dollar, people naturally start to talk about the level,” Padovani said in a phone interview from Sao Paulo. What Meirelles “wanted to say was that the exchange rate is related to fundamentals. He wanted to give a signal that he’s not committed to a level.”

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Nomura Says Sell the Dollar as Central Banks Reduce Holdings
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By Anchalee Worrachate

May 21 (Bloomberg) -- The dollar may decline against the euro, undermined by central banks trimming their holdings of the U.S. currency and the Federal Reserve printing money to buy assets, according to Nomura International Plc.

The dollar will probably weaken to $1.50 per euro by year- end, Stephen Hull, a foreign-exchange strategist at Nomura, said in a report yesterday. The greenback was little changed today against the common European currency, trading at $1.3763 as of 12:47 p.m. in London, from $1.3780 yesterday.

“We are becoming more confident on our short dollar call,” Hull, based in London, wrote in the note. “We continue to look for levels to sell dollars.”

Russia decreased the amount of its international reserves held in dollars at the end of 2008, while the share of euros rose, the nation’s central bank said yesterday. Fed officials meeting on April 28-29 may be ready to build on their March plan to buy $300 billion of Treasuries should the economy deteriorate further, minutes of the sessions released yesterday said.

China’s call for a possible alternative global reserve currency may also hurt the dollar, Hull said. People’s Bank of China Governor Zhou Xiaochuan urged the International Monetary Fund to expand the role of Special Drawing Rights, used by the IMF to settle accounts among its members, and move toward a “super-sovereign reserve currency.”

The share of Russia’s dollar holdings fell to 41.5 percent of reserves, from 45 percent as of Nov. 1, while the portion of euros rose to 47.5 percent from 44 percent, according to the central bank’s annual report.

Inflation Risk

“This is particularly important if other central banks start to do, or are doing, the same,” he said. “With global central banks holding $6.7 trillion of foreign-exchange reserves at the end of 2008, even small shifts are likely to have a big impact on the market.”

There are risks of inflation if “the Federal Reserve’s balance sheet cannot be shrunk quickly enough once the economy starts to recover,” Hull said. “We therefore think it conceivable that the big reserve holders of the world might want to limit their exposure to such risks, and Russia certainly seems to be thinking along these lines.”

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Kokusai Cuts Treasuries as Fukoku Sees End to Rally (Update2)
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By Wes Goodman

May 21 (Bloomberg) -- Bond investors in Japan from Kokusai Global Sovereign Open Fund to Fukoku Mutual Life Insurance Co. are trimming their holdings of U.S. Treasuries, betting that the biggest slump in U.S. debt in 15 years will likely continue.

Kokusai Global Sovereign, Asia’s largest bond fund, reduced its bet on long-term Treasuries in March, while Nippon Life Insurance Co., Japan’s biggest life insurer, plans to focus its new purchases on yen-denominated debt, it said last month. Fukoku Mutual says it will buy yen bonds because a 10-year rally in U.S. debt will end this year.

Japanese government securities are outperforming Treasuries in 2009 for the first time in a decade, according to indexes compiled by Merrill Lynch & Co. Investors in the Asian nation trimmed their purchases of foreign bonds in April to the least this year, the Ministry of Finance in Tokyo said. Investors say bonds will fall as a recovery in the U.S. economy sparks inflation and lures money into higher-yielding corporate debt and stocks.

“Japanese bonds are relatively more attractive,” said Masataka Horii, one of four investors for the $47.1 billion Global Sovereign Open Fund based in Tokyo. “Economic indicators show some bottoming out in the U.S. In Japan, the situation is still bad.”

Japan’s gross domestic product fell by an annualized 15.2 percent in the first quarter, a record, the Cabinet Office said yesterday. That’s worse than the 6.1 percent contraction in the U.S. economy. Japan’s economy is likely to shrink by 6.8 percent this year, versus 2.8 percent for the U.S., surveys of strategists by Bloomberg show.

Worst Start

Signs of a bottom in the U.S. economy helped send Treasuries down 3.3 percent this year through yesterday, the biggest slump since 1994, according to Merrill’s U.S. Treasury Master index. Japanese government bonds are down 1 percent, the Merrill figures show.

Federal Reserve Chairman Ben S. Bernanke is trying to reduce U.S. consumer borrowing costs by purchasing Treasuries, promising to buy as much as $300 billion of them by October as he works to snap the deepest U.S. economic recession in 50 years. Some Fed officials judged last month that the central bank may need to boost its purchases of assets to secure a stronger recovery, minutes of the April 28-29 Federal Open Market Committee meeting released yesterday in Washington showed.

Two Decades

Treasuries rallied the most in two decades when the Fed announced the plan on March 18, driving 10-year note yields down by 47 basis points, or 0.47 percentage point, to 2.53 percent. Ten-year yields had climbed back to 3.20 percent today as of 11:28 a.m. in London, according to BGCantor Market Data.

Dai-Ichi Mutual Life Insurance Co. and Asahi Mutual Life Insurance Co. said they plan to purchase Japanese debt and keep their holdings of U.S. bonds unchanged in the business year that started April 1.

“We are still on alert to downside risks in the investment environment,” Hiroki Kimura, an asset manager at Tokyo-based Asahi Mutual, said May 14. “We will continue to focus on yen- denominated assets, which offer stable income.”

Most of Nippon Life’s 1 trillion yen ($10.5 billion) of new investments this financial year will be in debt denominated in yen issued by the Japanese government and corporations, the company said on April 22.

Demand Increases

Demand for Treasuries rose in March before Japanese investors started their new fiscal year. Investors increased their holdings to $686.7 billion during the month, the most since December 2004, the Treasury Department’s most recent figures show. China, America’s largest creditor, increased its holdings to $767.9 billion.

In April, Japanese purchases of bonds abroad dwindled to $3.97 billion, the smallest amount this year, according to the Ministry of Finance.

Yields indicate investors expect U.S. inflation to accelerate. The difference between rates on 10-year notes and Treasury Inflation Protected Securities, which reflects the outlook for consumer prices for the next decade, widened to 1.68 percentage points, the most since September. The figure is still below the five-year average of 2.23 percentage points.

In Japan, the spread is negative 2 percentage points, indicating investors expect deflation. Japanese 10-year yields fell to 1.415 percent from 1.45 percent a month ago.

Yields to Climb

U.S. 10-year rates will rise to 3.45 percent by March 31, according to a Bloomberg survey of economists. An investor who bought today would earn 0.7 percent if the forecast proves right, after accounting for price changes and reinvested interest, according to data compiled by Bloomberg.

Yields are headed the other way in Japan, with the survey projecting a decline to 1.33 percent. The drop would bring a 1.9 percent gain to investors, the Bloomberg figures show.

“Japan is still in the stage of deflation,” said Satoshi Okumoto, who oversees the equivalent of $59 billion as a general manager at Fukoku in Tokyo. He’s more bearish on Treasuries than the consensus, forecasting a yield of 3.5 percent by year-end.

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British Land Writedowns Spark Bank Fears

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UK property giant British Land has seen £3.2bn wiped from the value of its portfolio, sparking new fears that banks will suffer huge losses from their commercial mortgage lending. Skip related content
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Britain's second-largest property firm, which owns most of the City's Broadgate office development, said its net value had tumbled by almost two thirds.

Its land portfolio is now valued at £8.63bn, 28% down on the valuation for the end of March 2008.

Yet chief executive Chris Grigg said the firm's performance has shown "real resilience".

The figures will be uncomfortable reading for many of Europe's largest property lenders.

Banks such as Royal Bank of Scotland Commerzbank and Lloyds Banking Group are sitting on billions' worth of vulnerable commercial property mortgages at risk of being devalued.

Last week, British Land's larger rival Land Securities blamed a record 2008 slump in the UK property market for slashing £4.74bn from the value of its assets.

UK banks have so far broadly turned a blind eye to borrowers breaching the terms of their lending agreements so long as they have been able to meet interest payments.

Yet an uncertain economic outlook has cast doubts on their ongoing ability to collect rent from tenants struggling to cope with recession - ramping up the risk of default.

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資産１・２兆円　今年最大の米銀破綻
2009.5.22 11:15

　米連邦預金保険公社（ＦＤＩＣ）は２１日、米銀中堅のバンクユナイテッドＦＳＢが経営破綻（はたん）したと発表した。資産規模は１２８億ドル（約１兆２０００億円）に達し、今年破綻した３４行の中で最大となる。

　同銀の業務や預金は、民間投資会社が出資し新たに設立した受け皿銀行が引き継ぐ。ＦＤＩＣが負担する処理コストは約４９億ドルに上り、米メディアによると、今回の金融危機では昨年七月に破綻した米銀大手インディマック・バンコープに次ぐ大きさとなる。バンクユナイテッドはフロリダ州で投資用住宅や別荘など住民以外を対象とした住宅ローンを手掛けていた。

　ガイトナー財務長官ら米政府高官は、金融市場に安定化の兆しが見え始めたと強調しているが、米銀の経営が依然として厳しい状況にあることが明確になった。（共同）

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巨額詐欺被害の三井住友銀、機密扱いの防止マニュアル流出

　不動産会社「コシ・トラスト」（東京都渋谷区）による巨額詐欺事件で、被害にあった三井住友銀行から同行作成の融資詐欺防止マニュアルがコ社側に流出していたことがわかった。

　逮捕されたコ社社長の中林明久容疑者（４０）らが虚偽の決算書などを使って巨額融資を引き出す際、銀行側の手の内を知ろうとしたとみられ、警視庁は内部情報の流出経緯についても調べを進めている。

　流出していたのは「ビジネスセレクトローン（中小企業向け無担保融資）　規定改定の背景とポイント」と題したマニュアル。同ローンを使った融資で、２００４年頃から偽造決算書などによる被害が相次いだため、同行が独自に作成した。〈１〉民間信用調査会社のデータと決算書の内容に乖離(かいり)があった場合は原則的に融資しない〈２〉連鎖被害を防ぐために不審案件を発見した場合は本社に至急連絡する――といった留意点を記してあった。

　０５年２月に各支店の法人営業部長を集めた勉強会で配布され、機密扱いだったが、コピーが行員に出回った可能性もある。同庁幹部によると、コ社側が実体のない約８０社名義で受けた約６１２億円の融資のうち、無担保融資は約１１４億円。このうち約４６億円が焦げ付いたという。

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Copper decline sparks wider base metal falls

By Chris Flood

Published: May 22 2009 03:00 | Last updated: May 22 2009 03:00

Copper prices dropped by more than 3 per cent yesterday, sparking a broad retreat across the base metals sector while crude oil fell by more than $1 a barrel as markets staged a correction after their strong run.

Risk appetite shrank after the Federal Reserve cut its US economic growth forecasts for the next three years and sentiment was further weakened by fears that the US and UK could face downgrades to their sovereign debt ratings.

Total returns on the S&P GSCI commodity index, the most widely followed benchmark for commodity investors, inched into positive territory for the first time this year on Wednesday.

Growing confidence in prospects for a rapid recovery in the global economy and continuing speculation about interest from sovereign wealth funds in commodities has led to talk that fund managers could increase allocations to commodity markets in June.

Copper dropped 3.3 per cent to $4,485 a tonne in spite of a fall of 5,400 tonnes in London Metal Exchange stocks amid talk that Chinese demand would slow for the traditional summer lull in smelting activity.

Economists at Credit Suisse said Chinese economic activity weakened further in May. "The recovery in China is still ongoing but the pace may not be as strong as many have hoped recently," said Dong Tao.

The premium for copper prices in Shanghai over London prices has collapsed, in effect closing the arbitrage opportunity for traders to import copper into China.

Volumes of copper earmarked for immediate delivery from LME warehouses have also fallen, suggesting that Chinese imports will slow further.

Rumours yesterday that a further 50,000 tonnes of copper was set to be delivered into Shanghai over the next two weeks only fuelled suspicions that the Chinese market was amply supplied.

Aluminium lost 2.9 per cent at $1,450 a tonne after a further large increase of 34,950 tonnes in LME stocks, which stand at a record high.

Nickel sank 3.9 per cent to $12,180 a tonne. Nickel inventories held by producers and in LME warehouses stood at 475,885 tonnes at the end of 2008, enough for 20 weeks of global consumption.

Eramet, the French mining group, said nickel stocks should fall 28.5 per cent to 340,786 tonnes by the end of this year, still sufficient for almost 15 weeks of consumption.

In energy markets, Nymex July West Texas Intermediate fell $1.48 to $60.56 a barrel after reaching a six-month high of $62.26 in the previous session. ICE July Brent lost $1.19 at $59.40 a barrel.

Harry Tchilinguirian, senior oil analyst at BNP Paribas, said that it was "remarkable" that oil prices had returned to $60 a barrel under current economic conditions and faced with high levels of crude oil inventories.

BNP noted that $60 a barrel was a level reached in 2007 when the global economy was growing at about 5 per cent, spare production capacity in Opec countries had dwindled to just above 2m barrels a day and constraints in non-Opec supplies were emerging.

"With the exception of non-Opec supply, none of those conditions apply this year, and yet we are at $60 a barrel," said BNP.

US dollar weakness helped gold hit a high of $946.50 a troy ounce, up 1 per cent.

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Switzerland rediscovers private banking roots

By Paul Betts

Published: May 21 2009 19:57 | Last updated: May 21 2009 19:57

Julius Baer’s decision to split its business to allow it to focus its full attention on private banking is interesting in the broader context of the future of that most Swiss of businesses – the custody of the wealth of the world’s super rich.

Following the recent onslaught of the G20 against tax havens, it would be easy to draw the conclusion that Switzerland's private banking community must be in full retreat. Julius Baer’s move is an indication that this is probably not the case.

For sure, UBS, once a powerhouse of global wealth management, has suffered dramatic outflows from its private banking activities. But in this area UBS seems to have been a painful exception. Just as the Swiss financial system beyond UBS has held up in the face of the financial crisis, so the private banking sector is showing signs of resilience in spite of UBS’s problems.

A large share of the money leaving UBS has been flowing to other Swiss institutions. Credit Suisse’s recent results suggested as much and UBS’s main competitor has certainly been a beneficiary of its big rival’s troubles. But the traditional private banking sector has also benefited and the decision of Julius Baer to focus on private banking suggests the expectation is that more funds will flow to the specialist, traditional players. This implies that tax evasion – which in the past has been the main reason for foreigners – is no longer the prime attraction the country’s private banks have to offer. Indeed, the G20 campaign has stopped any flow of tax evading money to Switzerland. The smarter banks saw this coming even if the Swiss government did not. Over the past decade, the bigger and more international operators such as Julius Baer, Lombard Odier and Pictet have changed their business models so that tax has become a tertiary factor at best in their asset gathering. Indeed much of their new business efforts are focused on markets where tax is low or even non existent.

The financial crisis has underlined the other reasons why the wealthy find Switzerland attractive – apart from its mountains, its lakes and its chocolate. The return of big government, nowhere more striking than in the stakes taken or influence exercised in banks all around the world, is causing growing concern for all those suspicious of government intrusion in the privacy of citizens.

Switzerland’s reputation for stability and security is clearly attractive for those looking to protect their wealth. And Swiss banks’ traditional prudence, less attractive during the bull market years, is coming back in fashion.

Of course, not all Swiss banks will be winners. The outflow of assets from UBS may continue for some time to come. Also those specialist private banks that failed to predict the global move against illicit funds will face a difficult future. But for those that have taken steps to internationalise and broaden their client bases, there will now be new pickings and consolidation opportunities in the sector.

Plugging in small savers

EDF is looking down the back of the sofa to find some extra loose change to help it fund its recent shopping spree. The French state-controlled electricity behemoth has seen its debt balloon to nearly €25bn ($34.7bn) after making its biggest acquisition in the UK with British Energy and buying half of Constellation Energy’s US nuclear business.

The utility has already raised more than €11bn over the past six months selling bonds to institutional investors. It is also planning €5bn of asset disposals to reduce its debt, and has started doing so by agreeing to sell a 20 per cent stake in British Energy to Centrica for £1.1bn ($1.7bn) in cash and a 51 per cent stake in Belgian electricity company SPE.

It is now proposing to tap France’s small savers with a bond issue reserved for retail investors that could raise anything between €700m and €1bn. In so doing, it would follow in the footsteps of its rival GDF Suez, which recently raised €750m in Belgium and Luxembourg with a similar issue reserved to retail investors in those two countries. If, as expected, EDF goes ahead with its bond for retail investors only it could accelerate the trend in France where the last such bond was issued a decade or so ago.

Not only the corporate sector but also the government and local administrations could be tempted to follow EDF’s example to raise badly needed cash. Such paper is likely to become all the more attractive for French small savers given the sharp drop in domestic interest rates. This has sent the yield in the country’s most popular savings instrument – the widely held Livret “A” savings accounts – to new lows.

Even if the EDF issue is unlikely to match the 5 per cent coupon of the GDF Suez bond for retail investors in the Benelux, it will still be more attractive than the 1.75 per cent the Livret “A” is currently yielding.

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小泉元首相→進次郎…「世襲制限」“姑息”抜け道

小泉純一郎元首相（左）と小泉進次郎氏
小泉純一郎元首相（左）と小泉進次郎氏

　自民党が次期総選挙から導入を検討している「新人候補の世襲制限」で、姑息な抜け道を検討している。小泉純一郎元首相の二男、進次郎氏（神奈川１１区）らの公認を見送って無所属で出馬させるものの、政党支部長にとどまらせ、対立候補も立てず、当選すれば追加公認する方針というのだ。民主党からは早くも「偽装無所属だ」との批判が出ている。

　「国民政党の自民党は多彩な人材を登用すべきだ。（世襲を）自浄作用で断ち切らなければいけない」

　自民党の菅義偉選対副委員長は２１日、「新しい政治を拓く会」の初会合でこう語った。

　党改革実行本部（武部勤本部長）も同日、次期総選挙から新人の世襲制限をすることで一致。国会議員の直系親族が同一選挙区から続けて立候補する場合には公認しないと党の内規で決める－との原案が提示された。

　これは、民主党が世襲新人の立候補を即時制限する方針を決めたため、自民党としても動かざるを得なくなったもの。決定すれば、進次郎氏と、臼井日出男元法相の長男、正一氏（千葉１区）が公認見送りとなるが、水面下では抜け道が検討されている。

　党関係者によると「進次郎、正一両氏は無所属となるが、対立候補は立てない。政党支部長にもとどまらせ、企業・団体献金も受けられる。県連の支援も黙認する。当選すれば追加公認する方針」という。

　民主党の鳩山由紀夫代表は２１日、「無所属で戦っても、当選後に追加公認されるなら姑息な話だ」と批判し、同党の菅直人代表代行も「逃げ道をつくるようなやり方ならば、国民から見透かされる」と切り捨てた。

　同党関係者は「まるで、３月の千葉知事選で『完全無所属』を名乗りながら、自民党支部長を務めていたとして市民団体に刑事告発された森田健作知事のケースと一緒だ」と話している。

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Obama insists Guantánamo must close

By Demetri Sevastopulo and Andrew Ward in Washington

Published: May 21 2009 17:15 | Last updated: May 21 2009 21:39

President Barack Obama on Thursday sought to overcome mounting congressional opposition to his plan to close the Guantánamo Bay detention camp as he said that the US might continue to detain indefinitely some suspected terrorists held there.

The president insisted that the US-run prison in Cuba still needed to be shut as it stood as a “rallying cry” for the country’s enemies.

“Rather than keep us safer, the prison at Guantánamo has weakened American national security,” Mr Obama said. “It sets back the willingness of our allies to work with us in fighting an enemy that operates in scores of countries . . . the costs of keeping it open far exceed the complications involved in closing it.”

He was speaking after the Senate on Wednesday voted overwhelmingly to block funding to close Guantánamo until the president set up a plan to satisfy congressional concerns.

The speech came as four members of an alleged domestic terrorist cell were to appear in court accused of plotting attacks on a New York synagogue and an airport north of the city used by the military.

Mr Obama said that the toughest challenge would be dealing with detainees who could not be prosecuted because, for example, of tainted evidence but who continued to pose a threat to the US.

“Examples… include people who have received extensive explosives training at al Qaeda training camps, commanded Taliban troops in battle, expressed their allegiance to Osama bin Laden, or otherwise made it clear that they want to kill Americans.”

Any “prolonged detention” would conform with US law, the president said. He said that he would not release detainees who threatened US security and stressed that no one had ever escaped from the “super-max” prisons used to house the most dangerous inmates in the US.

Outlining his plan to close Guantánamo, Mr Obama said that some of the 240 detainees would be tried in US courts.

Separately, the US Justice Department said that an al-Qaeda suspect accused of playing a role in two 1998 US embassy bombings in Africa would go on trial in New York, becoming the first Guantánamo Bay detainees to go on trial in a civilian US court.

Other detainees, Mr Obama said, would be brought before military commissions that would be restructured versions of the “flawed” military tribunals set up by the George W. Bush administration that would not, for example, allow evidence obtained using “cruel, inhuman or degrading interrogation methods”.

But the Center for Constitutional Rights, which has represented many Guantánamo detainees, accused Mr Obama of ignoring the constitution.

“The president wrapped himself in the constitution and then proceeded to violate it by announcing he would send people before irredeemably flawed military commissions and seek to create a preventive detention scheme that only serves to move Guantánamo to a new location and give it a new name,” said Michael Ratner, the centre’s president.

Mr Obama said that the US would try to transfer 50 detainees to other countries and stressed the need to release a further 21 detainees that US courts have said should not be in detention. The president’s own task force on Guantánamo has advocated releasing two of the 17 Uighur Chinese held at the camp into the US, a move that has led to dissent from the FBI and opposition from Congress.

Dick Cheney, former vice-president, said that it would be a grave mistake to bring the “worst of the worst” from Guantánamo to US soil. “It is easy to receive applause in Europe for closing Guantánamo,” but it was much harder to come up with an alternative that “serves the interests of justice and America’s security”.

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Barclays starts talks on selling off all of BGI

By Martin Arnold and Jane Croft

Published: May 22 2009 03:00 | Last updated: May 22 2009 03:00

FOR 2ND EDITION BC Partners, the private equity group, has stopped work on a potential $5bn counter-bid for iShares, the exchange-traded funds arm of Barclays, after the bank started talks to sell its entire asset management business, Barclays Global Investors.

Barclays had been keen to attract counter-bids to improve on the $4.2bn sale of iShares that it agreed last month with CVC Capital Partners, another private equity group.

But interest from potential counter-bidders has waned since BlackRock, the US money manager, approached Barclays about buying all of BGI, including iShares, in a deal expected to be worth more than $10bn.

The bank has made it clear that it is only prepared to sell BGI, which manages £1,047bn of assets, if it receives a top price.

A person close to BC Partners, one of Europe's biggest private equity groups with €11bn under management, said it had "downed tools" after failing to receive assurances that Barclays was still interested in a stand-alone sale of iShares.

"The focus at Barclays has clearly switched to selling all of BGI, with BlackRock as the frontrunner, so there doesn't seem much point for BC Partners in continuing to work on an iShares bid," said the person.

Barclays can seek counter-bids for iShares and other related businesses until June 18, under a "go shop" provision of that sale, but the bank must pay a $175m break-up fee to CVC if it chooses an alternative bid.

The bank's decision to sell iShares helped it to resist taking bail-out funds from the government by bolstering its capital levels. Barclays passed a stress test devised by the Financial Services Authority in March, which checked if it could withstand a severe recession. But a BGI sale would bolster its balance sheet.

Barclays is thought to have received 27 approaches when it first put iShares up for sale last year. It has attracted interest in a possible counter bid for iShares from Hellman & Friedman, a US private equity group. Apart from BlackRock, other asset management groups rumoured to be examining an approach for BGI include Bank of New York Mellon and Vanguard.

CVC is watching the situation closely, but a person familiar with the private equity group said it was "pressing on" with work to carve out iShares from BGI.

BGI operates in 15 countries and manages £1,047bn of assets. It offers funds focusing on active, index and asset-allocation strategies, as well as services including cash management and securities lending.

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Union threatens ballot on foreign labour

By Brian Groom, Business and Employment Editor

Published: May 22 2009 03:00 | Last updated: May 22 2009 03:00

The engineering construction industry faces the threat of official national industrial action as unions try to get a grip on illegal wildcat strikes that have disrupted power stations, oil refineries and gas terminals.

Unions are demanding a national agreement that local or UK workers should have priority for jobs before foreign contract staff are hired to meet shortages. They also want tighter auditing of contracts to ensure agreed pay rates are not being undercut.

One main union, the GMB, is threatening a national ballot for official action if it is not satisfied. "I think that's the way we have to go. Then we have control over it, it's going to be done in a proper manner and it's going to be done legally," said Phil Davies, national secretary.

Unite is more cautious. "Reaching a deal will be absolutely crucial and failure to do so could have serious implications for the industry," the union said.

Wildcat strikes were sparked off at seven sites in England and Wales this week after 40 Polish workers were hired to do lagging work at the South Hook liquefied natural gas terminal in Milford Haven, west Wales. The dispute ended yesterday after the subcontractor, Hertel UK, agreed to replace the Poles with UK workers. The company previously said it had been unable to find enough qualified local staff.

The strikes followed a dispute over Portuguese and Italian workers at Lindsey oil refinery in Lincolnshire in February. Unions insist that jobs, pay and conditions are the issues, not the workers' nationality.

The speed with which the Milford Haven dispute spread suggests a closely knit network of shop stewards is taking the situation out of union officials' hands.

"It shocked me," said Alun Rappell, GMB regional organiser. "I asked them to hold fire until Friday to allow this company [time], but overnight word of mouth got from site to site to site."

Skilled workers such as welders, steel erectors and laggers work on short-term contracts around the country and know each other well. Unions say there could be further flare-ups if the underlying problems are not resolved.

Unions will meet employers on June 3, followed by a national shop stewards' meeting two days later. The jobs issue may also get caught up in the industry's pay negotiations. Unions want a substantial increase but employers have indicated any rise must be paid for by giving up tea breaks.

Skilled workers, who typically earn £650-£700 a week on contracts, recently received a 5.8 per cent increase in the final stage of a three-year deal. They are aware that, beyond the recession, a lucrative wave of new power stations is in the offing.

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Lebanon makes Israel spy ring claim to UN

By Anna Fifield in Beirut

Published: May 21 2009 23:54 | Last updated: May 21 2009 23:54

Lebanon filed a complaint to the United Nations on Thursday after uncovering what it claimed was an Israeli spy network that has led Beirut to arrest 18 alleged agents accused of spying on Hizbollah in recent months.

Lebanese security forces have found listening devices hidden in cars, cans of motor oil and even in a watercooler, while two suspects have escaped across the Israeli border.

The office of Fouad Siniora, the prime minister, said on Thursday said Israel had violated Lebanese sovereignty by “setting up on its territory spy rings that were uncovered by the Lebanese army and security services”.

“The Lebanese delegation to the United Nations has filed a complaint over Israel’s violation of Lebanese sovereignty and [Security Council] resolution 1701,” his office stated, referring to the decision after Israel’s 2006 war against ­Lebanon.

Lebanon has charged 18 people with espionage since January, including a retired general, his wife, a butcher and a mobile phone salesman. Twelve are in custody and six are at large, two of whom escaped to Israel.

“The suspects arrested were part of different cells, each numbering three people at the most, and were not connected,” General Ashraf Rifi, head of internal security forces, said. “We managed to uncover a technological secret which allowed us to put together the puzzle.”

One cell was apparently collecting information on Hizbollah, the armed Shia movement that showed surprising military might during the 34-day war with Israel in 2006.

Nasser Nader, the mobile phone salesman, is seen as a key catch. “He is the most important suspect among the detained members of the Israeli-linked spying network,” Gen Rifi told the As-Safir newspaper, which is close to Hizbollah.

The discovery of the alleged network has led to a slew of theories in Lebanon, ranging from suggestions that Hizbollah had uncovered the network to show that Israel remained a threat to Lebanon, giving support to its fiery anti-Israeli rhetoric ahead of parliamentary elections on June 7.

People convicted of spying for Israel could face the death penalty if their actions were shown to have led to Lebanese deaths.

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Brazil May Boost Dollar Purchases, Standard Chartered Says
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By Renato Andrade

May 22 (Bloomberg) -- Brazilian central bank President Henrique Meirelles’s warning yesterday against an “excess of euphoria” in the currency market may foreshadow bigger dollar purchases by policy makers to curb the real’s three-month rally, according to Standard Chartered Plc.

The central bank began buying dollars on May 8, initiating “step one” in its bid to temper the real’s advance to a seven- month high, said Mike Moran, a currency strategist at Standard Chartered, which gets most of its revenue from developing nations. Meirelles’s comments yesterday were “step two -- upgrade the level of verbal intervention.”

“And step three is clearly much more aggressive interventions,” Moran said in a phone interview from New York. He predicts the currency will gain to 1.9 per dollar by year-end from 2.0311 yesterday.

The real has climbed 20.5 percent since March 2, the biggest advance among the six most-traded currencies in Latin America, as prices on the country’s commodity exports rebounded and investor demand for emerging-market assets picked up.

It’s up 14 percent this year, more than all 16 major currencies except for South Africa’s rand, in a reversal of the 33 percent plunge in the last five months of 2008. The UBS Bloomberg CMCI Commodity Index rose 21 percent since March 2.

Meirelles told reporters in Brasilia yesterday that he’s worried that investors may have become too bullish on the strength of the recovery in Latin America’s biggest economy after the slowdown late last year. Growth dropped to 1.3 percent in the fourth quarter from 6.8 percent in the third quarter as the global financial crisis deepened.

‘Great Speed’

“The market looks to anticipate and when a consensus starts to form, it moves at great speed,” Meirelles said. “Investors and companies have in the past suffered big losses because of an excess of euphoria. We have alerted them to this risk.”

Sadia SA, the poultry exporter that was acquired by rival Perdigao SA this week, booked more than 3 billion reais of expenses related to derivatives in the second half. Votorantim Participacoes SA, a closely held producer of materials from aluminum to cement, spent 2.2 billion reais to settle wrong-way bets on currency derivatives last year.

Moran said Meirelles’s statements were “an escalation of the existing policy” after the central bank bought “very small” amounts of dollars in the foreign exchange market in recent days.

Reginaldo Galhardo, currency-trading manager at Treviso Corretora de Cambio in Sao Paulo, estimates the central bank purchased about $150 million a day from May 8 to May 19.

2 Per Dollar

Galhardo and Luiz Roberto Monteiro, currency manager at Sao Paulo-based Corretora Souza Barros, said policy makers stepped up those purchases to more than $1 billion on May 20. The central bank doesn’t disclose the amounts it buys or sells in the currency market.

The purchases are the first in eight months. The central bank halted them in September amid the global crisis and began to sell dollars. The country’s foreign reserves totaled $203.7 billion as of May 20, down 2.6 percent from a record high set on Dec. 17.

Roberto Padovani, chief Brazil economist at Banco WestLB, said the timing of the dollar purchases -- just as the real was approaching 2 per dollar -- has created speculation that policy makers were looking to prevent the real from breaking that level.

“Every time the currency approaches 2 per dollar, people naturally start to talk about the level,” Padovani said in a phone interview from Sao Paulo. What Meirelles “wanted to say was that the exchange rate is related to fundamentals. He wanted to give a signal that he’s not committed to a level.”

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California dumps debt plan amid budget crisis

After the U.S. Treasury declined to guarantee short-term debt for California, Gov. Arnold Schwarzenegger said on Thursday he would scrap his plan to sell $6 billion in short-term debt to fund the state’s massive budget deficit and seek deep spending cuts instead.

Following meetings with state lawmakers and officials in Washington, Schwarzenegger said he decided to dump the debt plan and instead seek deeper spending cuts than he urged last week to tackle the state’s financial crisis.

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Chinese steel showdown over iron ore prices

By Patti Waldmeir

Published: May 21 2009 18:07 | Last updated: May 22 2009 01:46

China’s steel industry faces a historic moment of truth as it threatens to abandon the traditional “benchmark” for annual iron ore pricing in an apparent fit of pique at the refusal of the miners to share their profits.

The anger is palpable in the voice of China’s chief iron ore negotiator, Shan Shanghua of the China Iron and Steel Association, and from the mills: miners are making big profits but China’s steel industry loses money.

It is only common sense, says Mr Shan, that this situation cannot persist.

The conflict has arisen out of a peculiarity of the iron ore market – for the past 40 years, prices had been settled annually in secretive talks between steelmakers and miners, rather than in the open market, as in other commodities such as crude oil or copper.

The first agreement creates a benchmark price that is followed by the rest of the industry.

The peculiarities do not end there. China’s steel industry is also different: production has remained high even if final demand has slumped, supporting input prices such as iron ore but depressing steel prices and, therefore, margins.

This is explained by Beijing’s desire to avoid job losses in the industry.

Mining executives involved in the talks view Cisa’s argument as an attempt to force them to share the cost of Beijing’s social policies.

But Chinese officials see things differently. The country, the world’s largest iron ore consumer, has led the negotiations since 2005.

Its leadership started as its voracious appetite for ore triggered large price increases, including a record 85 per cent last year.

It was on the back of that increase – seen in China as a humiliation – that Beijing was adamant that, this year, with demand so much lower because of the global financial crisis, it would hold the balance of power. The Chinese side has become increasingly angry as the miners have refused their demands for a 40-50 per cent price cut, which would return prices to the level of 2007, say executives familiar with the talks.

Cisa is not alone in its fight to achieve a large cut. Chinese mills are in a defiant mood, saying they would rather buy cheaper ore on the spot market than accept a benchmark deal with a 30-35 per cent price cut.

The mills dismiss arguments that this is a short-term strategy that leaves them hostage to price rises once ore demand recovers.

But will China abandon the benchmark system, with its advantages of price stability, for an extra 10 percentage points price cut?

The answer, which mixes businesses, economics and politics – and some personal prestige – would influence the global economy as iron ore prices filter into steel costs and ultimately in the prices of goods such as cars and washing machines.

Mr Shan, who is leading the negotiations for the first time, is under heavy pressure and risks losing face if he cannot deliver the price cut he has promised since December, says Xu Zhongbo, a veteran steel analyst at Beijing Metal Consulting. “And Mr Shan has no steel mill,” he adds.

This echoes an argument also used by mining executives involved in the talks when they described Mr Shan as a “politician, not a businessman”.

But at least for this year, the benchmark may survive.

“Mr Shan risks losing face but we are only talking about a 5-10 per cent loss of face,” says a mill executive.

Baosteel, China’s largest steelmaker, which led the talks until recently, is also likely to put pressure on Cisa to keep the benchmark.

But even Baosteel seems to be losing its cool. Xu Lejiang, chairman, said last weekend that commodities traders were “possessed by evil” and were pushing up costs for companies such as Baosteel.

Cisa, for its part, continues to play its “bad cop” role, saying on Thursday it would not settle at a 30-35 per cent cut, the level at which South Korean and Japanese mills appear close to an agreement with the miners.

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Freight rates back on rise

By Javier Blas in Londo

Published: May 22 2009 03:00 | Last updated: May 22 2009 03:00

With the annual iron ore price negotiations reaching a critical stage, the market is looking increasingly at rising freight costs, as transportation is an important component of the final price that steelmakers pay for the ore imported from Brazil and Australia, writes Javier Bla s .

The Baltic Dry Index, the benchmark for freight costs for dry bulk commodities such as iron ore, yesterday hit a 2009 high, rising to 2,707, up 250 per cent this year and reaching its highest level in eight months.

While the index's strength is impressive - it has risen 51 per cent this month - the Baltic Dry is still far below last year's all-time high of 11,793 points.

Shipping brokers said demand for the largest vessels, known as Capesizes, is slowly recovering as Chinese steelmakers buy more iron ore from Australia and Brazil, as that is cheaper than buying lower-quality Chinese iron ore.

On top of this, Icap shipping analysts noted that a reduction of Indian iron ore export volumes due to the arrival of the seasonal monsoon rains is boosting demand for Brazil and Australian ores, which require a comparatively longer voyage.

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GlaxoSmithKline Caught In Huge Tax Battle

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SkyNews © Sky News 2009

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America's Internal Revenue Service (IRS) is reportedly investigating the British drugmaker over claims of complex tax-savings tactics.

If pursued by the IRS GlaxoSmithKline (GSK) may be forced to pay a potential $1.9bn (£1.2bn) in back taxes, interest and penalties.

GSK had already detailed the dispute in its annual report last March but the case, now highlighted by The Wall Street Journal, says the IRS is investigating a tax-savings technique known as "earnings stripping".

The practice usually involves reducing taxable profits in the US by claiming excessive interest deductions on intercompany loans from units abroad.

GSK, the world's second largest drugmaker, said the dispute arose over its "reclassification of an inter-company financing arrangement...from debt to equity and its consequent recharacterisation of the amounts paid as dividends subject to withholding tax".

It contests the IRS argument over tax liabilities going back to 2001 and initiated actions in the US tax court in August 2008.

The battle is the latest in a series of disputes between Glaxo and American authorities. In 2006, the company agreed to pay more than $3bn (£1.9bn) to settle a fight over so-called "transfer pricing", a year before it was due to go to trial.

Transfer pricing is a practice designed to minimise US taxable profits by overpaying foreign subsidiaries for product supplies.

GSK does not expect a court decision before 2011, assuming the matter cannot be resolved before then, it said in the annual report.

The company believes the taxman's claim has no merit and that no tax adjustment is warranted.

A spokesman for the IRS refused to confirm details, saying it "does not comment on any personal or corporate tax matters".

----------------------
Chavez nationalizes iron, steel companies

1 hour 52 mins ago
AFP

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"There is nothing to discuss. We've been on this for a long time," Chavez said in a televised address Thursday, ordering the beginning of "a process of nationalization to create an industrial complex."

Chavez, who has nationalized many of the mineral-rich country's biggest industries, named Matesi, Consigua, Ceramicas Carabobo and Tavsa, which produces seamless steel pipes for the oil industry.

Also affected were Orinoco Iron and Venprecar, subsidiaries of Venezuelan-owned International Briquettes Holding (IBH), which exports iron briquettes.

The announcement is the start of a "transition" so that these companies can become the "solid platform of socialism," he said.

"Venezuelan workers are going to give a lesson to the world on how the working class has been resuscitated to make a revolution!" he told industry workers in the western state of Bolivar.

The workers stood and sang the national anthem.

The move was part of leftist Chavez's socialist agenda that calls for nationalizing Venezuela's natural resources. Over the past two years, Chavez has taken over a wide range of companies from the electricity, oil, cement and telecommunications sectors.

Two weeks ago, the Chavez administration expropriated 39 oil service providers, some backed by foreign capital, after the government passed a law extending the state's control over all activities related to the industry.

Venezuelan Petroleum (PDVSA) and affiliated firms took "control of operation and the immediate possession of institutions, documentation, goods and equipment" of the 39 firms, the government's official journal said.

Many of the firms were subsidiaries of foreign businesses.

Venezuela's National Assembly passed a law on May 7 that "reserves for the state, the goods and services connected to primary hydrocarbon activities."

"We will start to recover assets that will now belong to the state, as they always should have," Chavez said at the time.

Chavez earlier Thursday pressed for his country's energy industry to wrest free of outside interests, symbolically seizing an American gas facility appropriated by the government earlier this month.

"A new stage" had begun for his country, the firebrand leftist leader declared as he strolled through the PIGAP II gas compression facility operated by the Oklahoma-based Williams Co.

Latin America's largest energy-producing nation, Venezuela announced it would take control of Williams's operations in early May when the Chavez government seized the assets of 60 local and foreign-owned oil firms.