IMF Leaders Seek ‘Quick, Effective’ Action on Growth
Global finance ministers have called for quick and effective action to safeguard faltering economic growth and rebuild shaken confidence.
The ministers warned Saturday at the annual meeting of the International Monetary Fund in Tokyo that global economic growth is slowing and substantial uncertainties and risks remain.
The IMF communique said the policies of advanced economies should be as growth-friendly as possible.
The finance ministers said emerging economies need to ensure “flexibility in policy implementation” to support growth.
U.S. Treasury Secretary Timothy Geithner told his fellow financial leaders the U.S. still has much work to do, despite making some fiscal progress. His comment came just hours after government officials announced in Washington that the nation's budget deficit had topped $1 trillion for a fourth straight year.
Asian Powers Increase Military Spending
A new study shows that over the past decade, five Asian powers have increased military spending to levels among the highest in the world, with China leading the way.
The study released Monday by the Washington-based Center for Strategic and International Studies says China has quadrupled its defense budget since 2000. It also says India, Japan, South Korea and Taiwan have dramatically increased their military spending.
That trend is in contrast with the United States and European Union, whose defense budgets have been declining in recent years.
Defense spending in the five analyzed Asian powers still trails that of the United States, but the CSIS study says it will surpass Europe's military expenditures this year.
The CSIS study says the five Asian governments spent about $224 billion in 2011, which is almost twice what they collectively spent in 2000. China's estimated defense spending has grown from about $22.5 billion to almost $90 billion in the past decade. But the authors say that some estimates put Chinese spending at a much higher level.
Japan's military budget was close to $60 billion last year. India's defense spending reached $37 billion. South Korea invested about $29 billion on its armament, while Taiwan's defense budget stood at $10 billion in 2011.
China now ranks second behind the United States in total military spending, although the Pentagon's budget still outpaces Beijing's defense spending at more than $600 billion year.
Self-Immolations Controversial in Buddhist Community
The practice of self-immolation is controversial in the Buddhist community, but it is a topic that has come to the forefront after more than 50 Tibetans have set themselves on fire to protest Chinese policies in their homeland.
Any kind of suicide is rare in Buddhist communities, where people believe in rebirth after death. A human life is considered a fortunate rebirth because of its opportunity to attain enlightenment.
The Tibetan spiritual leader, the Dalai Lama, has walked a fine line in his comments on self-immolation. He has questioned the usefulness of the act as a protest tool. He has said that the protesters have courage, but that they also should use their wisdom.
Representatives of the Dalai Lama and the prime minister of the Tibetan government-in-exile say the self-immolations are a sign that Tibetans can no longer tolerate China's push against their culture and religion.
Some Buddhists argue that the protesters are taking a strong compassionate action by giving their lives to bring about a better future for others. But some are concerned that the protesters are acting out of despair and frustration.
China has repeatedly denounced the self-immolations as terrorist acts. Beijing has accused the Dalai Lama of encouraging the self-immolations, noting that he has failed to fully condemn the actions.
On Saturday, a 52-year old Tibetan became the latest person to set himself on fire. Fifty-five Tibetans have burned themselves since February 2009 in a wave of anti-China protests that has gripped southwestern China and Tibet.
The Tibetan government-in-exile says 45 of those cases have resulted in deaths. Many of those who have set themselves on fire are monks or nuns.
EU Imposes Tougher Sanctions on Iranian Industries
EU foreign ministers have agreed to impose tough new sanctions on Iranian industries to try to pressure Tehran into negotiating an end to its sensitive nuclear activities.
After meeting in Brussels on Monday, the top diplomats of the 27-nation bloc released a statement saying the tougher sanctions are in response to what they call Iran's “flagrant violation” of international obligations and refusal to fully cooperate with the U.N. nuclear agency.
EU foreign policy chief Catherine Ashton said the sanctions are meant to persuade Iran to engage in negotiations that address international concerns about suspected military dimensions to the Iranian nuclear program. Tehran denies Western accusations that it is trying to develop nuclear weapons under cover of a civilian energy program.
The EU statement said one of the new penalties is a general ban on financial transactions with Iranian banks unless the transfers deal with humanitarian goods and EU authorities approve them in advance. Other measures include tighter restrictions on dealings with Iran's central bank, a ban on importing Iranian natural gas, and a ban on exporting graphite and metals that Iran could use for its weapons programs.
The White House welcomed the EU move, saying it “strengthens international efforts to … isolate the Iranian government.” Spokesman Jay Carney also said “rallying the world to increase the pressure on (Iranian leaders) so that they stop pursuing a nuclear weapon has been a top priority” for President Barack Obama.
Under the new sanctions, EU companies are prohibited from supporting Iran's ship-building industry and banned from transporting or storing Iranian crude oil – the country's main source of revenue. The EU banned imports of Iranian oil earlier this year.
An EU asset freeze and travel ban also will be imposed on additional entities whose names will be published Tuesday.
British Foreign Secretary William Hague said the EU will continue to intensify pressure on Iran “over the coming months” unless intermittent negotiations between world powers and the Islamic republic succeed. German Foreign Minister Guide Westerwelle accused Iran of “playing for time” and said EU nations do not see a “sufficient” Iranian readiness for “substantial” nuclear talks.
Iran has engaged in three rounds of talks with the five permanent members of the U.N. Security Council plus Germany since April, but has refused to scale back uranium enrichment unless major international sanctions are lifted.
2 Americans Win Nobel Economics Prize
Two American economists have won this year's Nobel Memorial Prize in Economics for their work in designing market institutions that match different parties within the market as efficiently as possible.
The Royal Swedish Academy of Sciences in Stockholm said Monday it awarded the prize to Alvin Roth, an economics professor at Harvard University, and Lloyd Shapley, a professor at the University of California, Los Angeles (UCLA).
The 89-year-old Shapley conducted early theoretical studies of matching methods in the 1950s and 1960s. He developed a formula of how 10 men and 10 women could be coupled so that no two of them would prefer each other over their current partners.
More recently, in the 1990s, the academy said the 60-year-old Roth used Shapley's research to redesign existing instructions for matching new doctors with hospitals, students with schools, and organ donors with patients.
It said the two Americans, who work independently of one another, will share the $1.2 million prize for an “outstanding example of economic engineering.”
The economics prize was not part of the original group of awards established in the will of Swedish industrialist Alfred Nobel, also known for inventing dynamite. The Swedish central bank created the annual prize in 1968 in Nobel's memory.
The 2012 Nobel Peace Prize and those in medicine, physics, chemistry and literature were announced last week. All awards will be handed out on December 10, the anniversary of Nobel's death in 1896.
British, Scottish Leaders Sign Deal on Independence Vote
British and Scottish leaders have signed a deal on a referendum that could lead to Scotland's independence.
British Prime Minister David Cameron and Scotland's First Minister Alex Salmond signed an agreement Monday in Edinburgh that finalizes details for a vote in late 2014 on whether Scotland should become an independent country or stay within the United Kingdom.
Mr. Cameron's meeting with Mr. Salmond in the Scottish capital follows months of negotiations. The British prime minister opposes a breakaway, but agrees it is up to the Scottish people to decide their future in a vote.
A survey released earlier this month suggests only about 28 percent of Scots support independence.
England and Scotland were joined by acts passed in 1707.
British rule currently covers England, Scotland, Wales and Northern Ireland.
Turks and Caicos politicians try to shed responsibility for health care contract
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With a poor standard of health care costing residents on the Turks and Caicos Islands (TCI) an exorbitant amount of money, the Progressive National Party (PNP) – the ruling party immediately prior to the imposition of direct rule by Britain – is making an extraordinary effort to distance itself from the failure and high cost of the National Health Insurance Plan (NHIP).
PNP deputy leader Carlos Simons has now joined leader Dr Rufus Ewing in trying to shift the blame onto the interim administration and possibly former Governor Gordon Wetherell, who reportedly signed off on the plan shortly after his arrival in August 2008, apparently during a period of pre-occupation with the damaging effects of two back-to-back hurricanes. This was a full year before direct rule came to the islands and some 18 months before the NHIP began operations. Simons has claimed it was not the plan put in place by the PNP but “the maladministration of the direct rule government.” “The health plan was launched by the current (interim British) administration,” said Simons. However, the process of choosing a third party health provider was completed by late 2006 and, eight months before Wetherell’s arrival, the health care contract was formally signed by the PNP administration while his predecessor, Governor Richard Tauwhare, was in office. The lead-up to the plan’s concept and the use of a third-party provider was apparently being structured as early as late 2003, shortly after the PNP took office. However, disagreements on the plan’s structure raised concerns on the part of then Health Minister Karen Delancy. While Delancy had the primary responsibility the plan as minister, it was nevertheless Ewing, as director of medical services, who was given authority over the decision making process. This upset Delancy, who felt that the process was so tainted she later provided a sworn statement describing what she viewed as an improper process to the special investigation and prosecution team (SIPT) headed by special prosecutor Helen Garlick. The first of Delancy’s concerns was the construction of the two hospital buildings and assuming her sworn statement is correct, recent claims by Ewing that he was not involved in the contracting of the building of the hospitals would appear to be untrue. In fact, in a continuing attempt to distance himself from the controversial plan, Ewing told a television audience last week that it was the direct rule government that “commissioned” the hospitals. However, the Delancy statement tells a different story. She swore that, five years prior to the suspension of the constitution and the imposition of direct rule, at a February 4, 2004 meeting, Ewing was present, along with Allan Forest, the general manager of hospital contractors Johnston Construction, and Michael Ashcroft, a principal of Johnston. Also at the meeting was then chief minister Michael Misick and finance minister Floyd Hall. Delancy testified in her statement: “Misick, Floyd Hall and Ewing spoke at length about the hospitals project... the impression I gained was that it was highly likely that Johnston International would be awarded the hospitals (building) contract.” Johnston Construction was in fact awarded the contract without a bid tender. Then PNP supporter Royal Robinson was assigned the responsibility as liaison between the PNP government and contractor Johnston. Robinson has since acknowledged that Ewing was in fact a key part of the process, stating publicly that Ewing was a member of the inner circle that contracted with Interhealth Canada as the health services provider and with Johnston Construction as the hospital building contractor. The two small two-storey hospitals built under the contract – one in Provo with 20 beds and the other in Grand Turk with 10 beds – are encumbered by a mortgage of $235 million. If the mortgage runs its full 24-year course with interest, the buildings will have cost TCI residents half a billion dollars. Later in her statement, Delancy speaks of the process for selecting the third party health care provider. At a meeting only two months later, in April 2004, which was held at the Cleveland Clinic in Miami, Ewing, Floyd Hall and Cynthia Astwood were present with Delancy. At this meeting, discussions were conducted as to the possibility of the Cleveland Clinic participating in the provision of health care in the TCI. The Delancy statement appears to reinforce more recent comments by government CEO Patrick Boyle that Ewing was a central player in the formation of the NHIP, a position Ewing has now tried at length to deny. While Interhealth Canada was eventually selected as the secondary care provider, Ewing remained, as director of medical services, in charge of all the primary care clinics around the islands until his resignation from the civil service in March of this year. Current Governor Ric Todd described the then Ewing-run health services as a “poor level of primary health care”. When officials in the interim administration were questioned last week on the matter of responsibility for the health care debacle, a source is reported to have said, “This is a deal the interim administration inherited.” |
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Tropical Storm Leslie creeps northwards towards Bermuda
Tropical Storm Leslie continued to churn in the central Atlantic, slowly heading towards Bermuda, where the National Hurricane Center in Miami said the system may strengthen to a hurricane and brush the island later this week.
At 5:00 pm EDT on Tuesday, the centre of Tropical Storm Leslie was located about 500 miles south-southeast of Bermuda, moving toward the north near 3 mph. A slow northward motion, which may be erratic at times, is expected over the next couple of days.
Maximum sustained winds are near 65 mph, with higher gusts. Some strengthening is possible and Leslie could become a hurricane in a couple of days.
Swells generated by Leslie will continue to affect Bermuda, the US east coast from central Florida northward, the northern Leeward Islands, Puerto Rico and the Virgin Islands for the next several days. These swells could cause life-threatening surf and rip current conditions.
Meanwhile, Tropical Storm Michael has also formed over the central Atlantic and the centre was located about 1,210 miles west-southwest of the Azores, moving toward the north-northwest near 7 mph. A north-northwestward to northward motion is expected through Wednesday and a turn toward the north-northeast is forecast to begin Wednesday night and continue on Thursday. Little change in strength is forecast during the next day or so and there is currently no threat to land.
Bahamas must consider income tax, says former minister
A key advisor to the Christie administration says income tax must be considered in The Bahamas to curb its rising debt levels.
James Smith, a former state minister of finance, told Guardian Business that the government should look at all options. The chairman of CFAL added that he is a strong proponent of value-added tax (VAT), although he is open to any system that corrects the course of the economy.
"This no tax issue is simply not the same discussion anymore," he explained. "Five years ago, income would have been off the table. But I suspect it will come up. The time has come to look at all options, to the extent The Bahamas has stopped promoting itself as a tax-free jurisdiction. I think we can begin to move away from that model."
The top business leader will be a mediator for at least one panel discussion at the upcoming National Symposium on Tax Reform, held at The College of The Bahamas from October 25 to October 26. The two-day, televised event is chaired by Prime Minister Perry Christie, with Governor General Sir Arthur Foulkes agreeing to serve as patron.
While adding to the national dialogue on this fundamental issue, the symposium plans to submit a paper for consideration to government on the way forward for tax reform.
For his part, Smith told Guardian Business the landmark event is simply a natural economic progression. Tax information exchange agreements (TIEA) and compliance with the Foreign Account Tax Compliance Act (FATCA) have been well documented over the years.
"Something has to be done to reform dramatically the tax structure. The existing structure cannot service the growing economy. We'll end up with increasing deficits, to the point where the debt to GDP ratio would be hard to finance locally and broad. Questions will be raised on our ability to service our own debt," according to Smith.
Although the debt-to-GDP ratio is estimated at 54 percent, the CFAL chairman pegged it at 65 percent including contingent liabilities, such as the Bahamas Development Bank and Water and Sewerage Corporation.
Dionisio D'Aguilar, the president of Superwash and chairman of AML Foods, highlighted the country's persistently narrow tax base as the key problem. He felt reform must target those professions that have historically paid very little tax, such as lawyers and accountants.
"They contribute a very small amount of their income to the treasury, whereas a good store contributes an enormous amount," the retailer said.
Declaring himself "pro VAT", the top businessman also said the government must become more organized and aggressive in how it collects existing taxes. More specific penalties must come into play for individuals that fail to pay their share.
The government could also do more to impose insurmountable hurdles for business entities that fail to comply in time.
Smith pointed out, in the next several weeks, the prime minister intends on presenting government with the much-anticipated "white paper" on tax reform. The tax symposium next month will surely go a long way in paving the way for this historical document.
"The symposium is very timely, with the white paper expected sometime before Christmas," he added.
Republished courtesy of the Nassau Guardian
EXTRA FUNDING SECURES PRIMARY SCHOOL PLACES FOR ALL
TCIG has now approved the funding to secure the 63 children’s places at three private schools.
Every child in the Turks and Caicos Islands who requires a primary school place will be given one this financial year thanks to an additional $68,000 of funding rovided by the TCI Government it was revealed today, Wed, 5 Sep 2012.
Two hundred and thirteen children were registered for school this year. TCIG initially had funding in place for only 150 children, leaving 63 four year old students were left without a school place on Providenciales.
These students were already on the Department for Education’s official waiting list having registered for school earlier in the year. The students will be put into three classes one each at three private schools. The agreement will cover the basic salaries for three class teachers one at each school. This announcement follows a proposal by Director of Education, Edgar V. Howell, to Chief Executive Officer Patrick Boyle made via Permanent Secretary Desiree Lewis.
“I am aware that this year TCIG is faced with the problem of overcrowding in its schools, in particular on the island of Providenciales,” said Patrick Boyle CEO of TCIG. “Whilst this is clearly only a short term stop gap, I have tasked the Department of Education to now develop a sustainable solution to this recurring issue.”
There are three public (non fee paying) primary schools and one public high school on Providenciales serving approximately 2,600 students.