Showing posts with label us export council. Show all posts
Showing posts with label us export council. Show all posts

Thursday, June 7, 2012

South Africa -State cannot build cheaper — Trevor Manuel


It is a mistake to assume that the state alone is responsible for improving infrastructure and can deliver it more cheaply than the private sector, says Planning Minister Trevor Manuel .

He questioned the controversial decision by the Cabinet last week to veto a deal between Telkomand South Korea’s KT Corporation, which would probably have resulted in lower data prices for consumers.

Deputy President Kgalema Motlanthe on Tuesday praised South Korea for propelling itself into the top-eight richest economies in the world by setting up a knowledge-based economy.

"Even when lucrative offers are on the table we seem not to be able to utilise them," Mr Manuel told a conference yesterday organised by the Bureau for Economic Research.

"We think we as a state can deliver more cheaply than the private sector."

KT was set to buy a 20% stake in Telkom for R3,3bn — a badly needed cash injection for the ailing company — but that would have diluted the government’s 39,8% share in Telkom.

Mr Manuel said capacity was a "fundamental challenge" in implementing the plans to upgrade SA’s infrastructure.

The government aims to spend R845bn over the next three years to improve roads, railways and ports, increase power supply and improve social infrastructure.

"This notion that the state should be responsible for delivery ... is a non-starter. If we want transformation, a lot will emerge from partnerships (with the private sector)," Mr Manuel said.

His comments are the strongest acknowledgement yet by a Cabinet minister that the government lacks capacity to deliver on its infrastructure plans.

Last week, Transnet CEO Brian Molefe said that possible capacity problems were one of the threats to the group’s R300bn investment programme.

Grahame McCaig, MD of construction and engineering group Aveng Grinaker, told the conference he was "shocked" by the dilution of skills when he returned to SA after an 18-year absence.

"It’s not just general management skills but trade skills ... manufacturing and construction productivity are going down.

"We need people who can use their hands ... it’s not just a South African issue, but it needs to be addressed very urgently."

Mr McCaig said more than 80% of his firm’s R34bn turnover in the financial year 2010-11 was generated by private sector projects. Lack of engineering skills in the government and municipalities was responsible for the lack of public sector participation.

A Presidential Infrastructure Co-ordinating Commission study released last month counted 5515 engineers in the public sector.

Mr Manuel said infrastructure should be paid for by its users, although the state had a role to pay in "lengthening the payback period". But the poor should be shielded from this, he added.

He was critical of the idea that high wage settlements would boost demand, saying they would only lead to greater poverty and inequality. Finance Minister Pravin Gordhan has pledged to keep public sector pay rises in check this year, but unions are already threatening action as their demands are not being met.

Global rating agencies have warned that the outcome of the negotiations could affect SA’s investment grade credit rating.

It was "necessary for the state to have the best sovereign rating that it can", Mr Manuel said.

isam@bdfm.co.za

Tuesday, May 29, 2012

DIFC-based firms boost deposits to $12.8 billion

Issac John / 29 May 2012

The Dubai International Financial Centre, or DIFC, said on Monday that deposits out of the global financial hub have grown in the past three years at an average annual rate of 39 per cent to reach $12.8 billion at the end of Q1 2012.



Loans and advances of DIFC’s regulated entities rose over the same period at an average annual rate of 40 per cent to reach $14.7 billion.

Assets under management at DIFC-based companies remained steady, and recorded $8.1 billion during the period.

Abdulla Mohammed Al Awar, chief executive officer of the DIFC Authority said the numbers were testament to the successful growth in the breadth and depth of financial activity within DIFC due to the diverse services provided by the regulated firms. “As one of the global financial hubs, it is natural that we are observing an influx of new companies from around the world, especially banking and financial services firms, who are attracted by the vast opportunities the region offers.”

“Our effort toward enhancing DIFC’s legal and regulatory framework as well as its physical infrastructure positions DIFC as an ideal platform for regional and international growth,” said Al Awar.

He said DIFC continued to grow steadily as one of the world’s established financial centres. “As of March 2012, the DIFC community comprised 861 active registered companies (322 regulated and 539 non-regulated companies); already two per cent up on 2011 numbers.”  Dr Nasser Saidi, Chief Economist at the DIFC, said the hub is the only international financial centre that collects and publishes financial activity data of its registered entities.

“What the data clearly shows is that DIFC entities have witnessed continued real growth over the past three years, despite the international financial crisis and regional events.  “Deposits and credit growth rates of DIFC-based companies have also been substantially higher compared to those of the GCC area banks. We expect higher growth to continue as DIFC-based companies expand their activities further.”

The DIFC is home for 21 of the world’s top 30 global banks, 8 of the top global money managers, 6 of the 10 largest insurers and six of the top 10 law firms in the world.

The DIFC statistics are collected from different sources.

The DIFC Economics team and the Dubai Financial Services Authority provided data and estimates. Other information, including data on deposits, credits, and assets under management outside the DIFC, were collected from monetary and statistical authorities’ websites and other databases.

issacjohn@khaleejtimes.com

Al Maliki holding Iraq to ransom


Democracy is not served by political instability and pushing for a military showdown with Kurds
The roots of Iraq’s present political conflict lie in the 2010 elections. But in reality, the problem started since the establishment of the country in the 1920s. Almost a century has passed, but these conflicts have not been resolved.
The problems between different Iraqi blocs are numerous and varied. However, the most dangerous of them is the conflict between the government in Baghdad and the Iraqi Kurdistan government. Some say that it is a conflict between Kurds and Arabs though Iraqi governments prior to 2003 saw it as a form of Kurdish mutiny.
Kurds consider the conflict as a struggle for gaining their legitimate rights in their land.
Iraqi governments, in both the monarchy and the republican eras, tried to resolve the conflict through force. The results were devastating as the clashes depleted Iraq’s human and financial wealth. The struggle also obstructed Iraq’s development plans and contributed to undermining its national security, leading to interference from neighbouring countries.




Iraq’s political atmosphere was never devoid of dangerous tensions, but after the downfall of the Baathist regime, it has entered a new phase that is threatening to destroy the foundations of democracy.
Prime Minister Nouri Al Maliki is at the centre of these developments, and has been targeted by many. He has clashed with fugitive vice-president Tareq Al Hashemi, deputy prime minister Saleh Al Mutlaq, chairman of Al Iraqiya bloc Eyad Allawi, president of the Kurdish province Masoud Barzani and Sadrist leader Muqtada Al Sadr. Al Maliki is probably having problems with those in his own Al Dawa party.
Political survival
It is difficult to see Al Maliki emerging unscathed from these conflicts as all these forces are closing in on him in a joint attempt to get him out of office.
Playing on the interests of the US and those of regional powers, which served him well in recent years, will not ensure Al Maliki’s political survival, as finding a substitute is not very difficult.
The opposition has lately become more influential and has begun to take the initiative.
It recently held a meeting that was also attended by Al Sadr. A memo was sent by those who met in Arbil to the Iraqi National Alliance (INA), giving them two weeks to reply and threatening a no-confidence motion if they failed to comply. The two weeks went by, and another meeting was held in Najaf. The INA was given another week to choose a new prime minister.
Members of parliament threatening to go ahead with the no-confidence motion against Al Maliki constitute a majority in the house. However, whether or not they actually go ahead with this decision is not guaranteed. Each lawmaker has a number of issues that decide his or her position, and some of those are personal and related to re-election. Other factors that may influence the decision may relate to the power vacuum Al Maliki’s dismissal may create.
The INA expressed its backing for Al Maliki as a reply to the Arbil ultimatum. It also pointed out that it does not mind instituting reforms if Al Maliki can continue as prime minister.
In the midst of all this, the prime minister decided to turn the tables and transform the struggle into a conflict with the Kurds.
Al Maliki, accompanied by ministers from the federal government arrived in Kirkuk on May 8 to hold a cabinet meeting. His visit was preceded by military forces, who had orders to drive away any militia.
The struggle has become extremely tense.
Kirkuk drama
Al Maliki chose Kirkuk as a battleground so as to announce from an Iraqi city that includes every component of Iraq’s ethnic and sectarian groups that the demand of the Kurdish province to include Kirkuk is unacceptable to his government. And that the Constitution’s item 140 — relating to Kirkuk determining its future — is not applicable.
Thus, Al Maliki decided that the differences, and the mechanisms to solve them, will not be settled through the constitution. He was also very clear about freezing it until the end of his tenure. All this will serve Al Maliki’s opponents, who accuse him of being autocratic.
Al Maliki’s shortsightedness is dangerous as it contravenes the strategic alliance between the State of Law and the INA.
Al Maliki is pushing towards a military a showdown with the Kurds at a time when they are stronger than ever before — locally, regionally and internationally.
He is betting that his dangerous step will break the opposition alliance against him, as he thinks he will be seen as fighting a national battle. He is also betting on other smaller alliances with those who have already walked out on Al Iraqiya.
Al Maliki’s statements about freezing the constitution raise concerns about his seriousness regarding democracy in Iraq. Talking about freezing the constitution is akin to a coup against the political process in Iraq. It is like declaring a state of emergency, wherein the government does what it pleases.

Dr Mohammad Akef Jamal is an Iraqi writer based in Dubai.

Thursday, June 2, 2011

South Africa approves Wal-Mart bid, govt could take action

South Africa approved Wal-Mart’s R16.5 billion (US$2.4 billion) bid for control of retailer Massmart with minimal conditions on Tuesday, giving the world’s top retailer a big boost in its plan to expand in fast-growing Africa.

South Africa’s Competition Tribunal told Wal-Mart not to cut jobs for two years, honor existing labor agreements, and work to develop local suppliers, concessions the US firm had earlier proposed itself.

The deal gives Wal-Mart a 51 percent stake of Massmart, a discount retailer that sells everything from liquor to televisions and has a presence in at least a dozen African countries.

The decision will be seen as a major advance for Wal-Mart, which had said it could drop its offer if the government imposed targets on using local suppliers.

“This is good news. It included concessions put forward by both parties so it’s a victory all round,” said Paul Theron, CEO of Johannesburg-based asset manager Vestact.


“It shows that South Africa is open for business, that large corporates are potential players for outside investment.”

Massmart must also “give preference” to reemploying 503 workers fired in 2010, set up a R100 million (US$15 million) fund to help develop local suppliers, and not challenge SACCAWU’s right to represent bargaining units for three years, the tribunal said.

The two companies said in a joint statement they were “pleased” with the decision and expected Massmart’s food business to grow by 50 percent over the next five years.

The decision was a victory for Wal-Mart, as it did not impose restrictions on where it sources it goods, said Brian Sozzi, a New York-based analyst at Wall Street Strategies.

“In two years it looks like they can go to town on labor costs,” he said.

“The whole thing with them is to get goods into the South African market as cheap as possible and sell them as cheap as possible.”

However, the ruling is a blow to South Africa’s influential labor unions, one of which is already considering an appeal.

“We are meeting with our legal representatives to explore legal options,” said Mike Abrahams, a spokesman for the South Africa Commercial, Catering and Allied Workers Union (SACCAWU), adding that the union could consider appealing to the Competition Appeals Court.

That could further delay the deal, which was first announced in September 2010.

The deal was a test case for major foreign investment in South Africa, which has the continent’s deepest capital markets but where unions are in a coalition with the ruling African National Congress.

Three government departments – economic development, trade and industry, and forestry and fisheries – and the unions had lined up against the deal, asking the tribunal to impose targets on local procurement and a freeze on job cuts.

The government and unions have said Wal-Mart’s global supply network could lead to a flood of cheap imports, sparking job losses and squeezing local companies.

“We would have hoped that the deal would be rejected or at least much more stringent conditions be imposed,” said Patrick Craven, a spokesman for the COSATU union federation.

“Our biggest concern remains completely unanswered, and that is the knock-on effect on jobs in other retailers and the manufacturing industry.”

The three departments said in a joint statement late on Tuesday they would need further study to determine whether the conditions were sufficient enough to prevent widespread job losses.

“Based on the outcome of the study of the conditions and the responses of Wal-Mart/Massmart, we will decide on the next steps to take. Government reserves its legal options at this stage,” the three departments said.


http://www.tralac.org/cgi-bin/giga.cgi?cmd=cause_dir_news_item&cause_id=1694&news_id=104482&cat_id=1026

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Wednesday, June 1, 2011

WORLD INDUSTRIAL PRODUCTION ON THE RISE

World manufacturing output has grown by 6.5 per cent in the first quarter of 2011 compared to the same period last year, the United Nations Industrial Development Organization (UNIDO) reported today.

“The figure clearly indicates the progress of the recovery of world industrial production from the recent financial crisis,” UNIDO http://www.unis.unvienna.org/unis/pressrels/2011/unisous085.html said, in the first edition of its new plan to report industrial statistics quarterly. Formerly the presentations were annual.

The report, based on an analysis of quarterly production data, said developing countries were in the lead with their manufacturing production increasing by 11.5 per cent. The major contribution to this growth was by China, with its output growing by 15 per cent.

Newly industrialized countries also performed well, with Turkey displaying a growth rate of 13.8 per cent, while Mexico’s was estimated at 7.4 per cent and India’s at 5.1 per cent.

The manufacturing output of industrialized countries increased by 4.4 per cent during the named period, with strong growth of 7.1 per cent observed in the United States, the world’s largest manufacturer.

Major European economies, including France, Germany and the United Kingdom, also demonstrated significant growth in manufacturing output. But other European countries, such as Greece, witnessed a 6.9 per cent drop, while Portugal and Spain maintained a marginal growth of less than one per cent.

Japan’s figures fell by 2.4 per cent. The full impact of the March Tsunami disaster was not yet reflected in manufacturing production data for the first quarter.

Negative growth was observed in North Africa, where the manufacturing output of Egypt and Tunisia fell by 8.9 per cent and 7.4 per cent respectively.

The UNIDO report also contains the growth estimates for the first quarter by major manufacturing sectors. It suggests that production of general machinery has increased by more than 15 per cent, electrical machinery and apparatus by 12 per cent, and medical and precision equipment by 11 per cent.

While industrialized countries performed well in high-tech sectors, their growth in traditional manufacturing areas such as food and beverages, textile and wearing apparel was quite low. Developing countries maintained higher growth across all sectors.

US EXPORT COUNCIL PROVIDES ASSISTANCE TO US COMPANIES SEEKING ACCESS TO HIGH GROWTH MARKETS OVERSEAS. http://usexportcouncil.com/

Tuesday, March 30, 2010

President Obama outlines strategy to boost US exports -- and jobs

President Obama moved Thursday to create a high-level team to promote US exports, with the goal of creating 2 million jobs within the next five years.

The project will span from efforts to reduce hurdles for companies in shipping goods overseas, to adjusting trade policy with a blend of carrots (a push for new free-trade agreements) and sticks (tougher enforcement of trade rules). The near-term goal is to double US exports within five years.

"For the first time, the United States of America is launching a single, comprehensive strategy to promote American exports," Mr. Obama told the annual conference of the Export-Import Bank, an institution in Washington designed to promote US trade.

Getting that many more jobs from exports won't be easy, but new efforts on trade are very much needed, economists say. The most obvious reason is that America needs more jobs, at a time when consumer demand at home remains tepid. A second reason is that the world economy continues to become more competitive, which means that the US can't rest on its laurels as the world’s leading exporter of goods and services.

"Ninety-five percent of the world’s customers and the world’s fastest-growing markets are outside our borders. We need to compete for those customers. Because other nations are," Obama said. "We need to up our game."

Obama outlined a multipart "national export initiative":

• He signed an executive order "instructing the federal government to use every available federal resource" to boost exports. The order created an "export promotion cabinet," made up of the secretaries of State, Treasury, Agriculture, Commerce, and Labor, plus the US trade representative and other officials.

• He revived a separate body, called the President’s Export Council, and named Boeing CEO Jim McNerney and Xerox CEO Ursula Burns as co-chairs. The panel will make recommendations on trade policy.

• Multiple cabinet departments will help create a "one-stop shop" for small employers that want help identifying opportunities and setting up operations overseas. The effort would include embassies and consulates abroad, as well as agencies like the Departments of Agriculture and Commerce.

• Obama pledged to promote new free-trade agreements while also enforcing laws on the books, such as intellectual-property rights. "China moving to a more market-oriented exchange rate would make an essential contribution" to a more-balanced global economy, he said. That move could also help narrow the large gap by which US imports exceed exports.

• The administration will increase access to trade financing. Obama commended efforts by the Export-Import Bank over the past year to step up its activities when US credit markets were impaired.

In addition, Obama pledged to be a kind of salesman in chief for US companies, with him and his cabinet members plugging the virtues of "made in America" when they travel overseas. Next week, the president will take his export evangelism to Indonesia and Australia.

The announcement about export strategy came as a government report showed a narrower-than-expected trade deficit for the US in January. Imports exceeded exports by $37.3 billion, with the volume of oil and automobile imports falling for the month.

Obama first announced the goal of doubling exports within five years during his State of the Union address to Congress in January.

Some economists, running the numbers, have said it's a difficult objective to reach.

"During the last 25 years nominal exports never grew this quickly in five years; it took an average of 11 years for exports to double," economist Sven Jari Stehn wrote in an analysis for Goldman Sachs.

Hitting the goal, he estimated, would require a combination of strong global economic growth and an adjustment of the dollar's value relative to currencies such as China's yuan.

"If global real GDP grew by an above-consensus 4.5 percent during the next five years, the dollar would still need to depreciate by about 30 percent, slightly more than the largest 5-year real depreciation on record during the last 25 years," Mr. Stehn concluded.

This doesn't mean that Obama's target is unreachable, however. And efforts to boost exports and achieve a more-balanced global economy could bring benefits even if his goal isn't reached.

By Mark Trumbull, Staff writer / March 11, 2010 The Christian Science Monitor

Monday, November 30, 2009

Iran’s Ignoble Act

The semantics over whether the Iranian authorities actually did “confiscate” Shirin Ebadi’s 2003 Nobel Peace Prize medal as has been alleged by Norway, or merely “removed” it from her bank’s safe deposit box (together with other personal items) in connection with a ‘tax evasion’ case as is being claimed by the Iranians, is neither 
here nor there.

What is more relevant, considering that both the blocking of the bank account and the confiscation of the award is illegal under Iranian law, is whether the move has been motivated by petty politics. At least that is what Mohammad Ali Dadkhah, a spokesman for Ebadi’s human rights group, says is what has happened.

And given that Ebadi is an outspoken critic of the government and human rights violations, that indeed sounds more plausible. Also, the fact that the Nobel laureate has been strongly critical of the June presidential polls must have prompted a regime known for its intolerance of any degree of political dissent to carry out this ignoble act. Therein lies the most obvious motive. And the minutiae of any counter-argument or ‘technical’ justification can only make a disgraceful act more despicable.

Not surprisingly, the Norwegian Nobel Committee’s permanent secretary, Geir Lundestad, has said categorically that the move was “unheard of” and “unacceptable.” Surely, Teheran too is well aware of its plummeting reputation and credibility in the international community — primarily as a consequence of such singular acts of political vindictiveness.

Of course, President Mahmoud Ahmadinejad did secure enough votes in the controversial June 12 polls to remain in power. But it must be remembered, his re-election also sparked the largest street protests in the country since the 1979 Islamic revolution. Ahmadinejad has a lot to answer and the Iranian civil society knows it better than anyone else.

The persecution of Ebadi (including her husband or family or friends) on any pretext can only further discredit an already discredited government. Ebadi herself, who had left Iran shortly before the June polls, continues to receive all kinds of vicious threats.

She has announced that she would “return whenever it is useful for my country.” But before she returns, it would be best if the Iranian authorities reverse their decision and return Ebadi her prized Nobel medallion with full honours and, if it’s not too much to ask, with some good grace as well for good measure.Not to do so is not an option.

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America Can No Longer Afford its Wars

Congressman David Obey, a Wisconsin Democrat who is chairman of the powerful House Appropriations Committee, has come up with a novel idea: American should pay for the 
wars they are waging.

Obey’s proposal, which is backed by ten other congressmen, sounds startling — until one realises that both the Bush and Obama administrations have never properly financed their foreign wars by forcing Americans to pay for them through higher taxes.

Instead, Washington has deferred the $1 trillion to date costs of the Afghanistan and Iraq wars by simply adding them to the national debt, and paying interest on the balance owing.

So very few Americans feel the real financial costs of these wars. Future generations will get stuck with the bill.

But this kind of deceptive national accounting is becoming increasingly difficult in the face of President Barack Obama’s $1.4 trillion deficit this year, and his impending decision to send 30,000 to 40,000 more US troops to Afghanistan. Each American soldier in Afghanistan costs $1 million per annum, according to the US Congress Research Service. Thirty or forty thousand more US troops will thus cost $30 to $40 billion in additional war costs on top of the $200 billion annual cost of garrisoning Iraq and Afghanistan. Much of this money will have to be borrowed from China and Japan.

Obey and his allies want to impose a graduated surtax on Americans of 1-5 per cent, depending on their income level, to fund the actual costs of what are now Obama’s wars. Otherwise, warns Obey, the huge cost of keeping up to 100,000 US troops in Afghanistan will ‘destroy the other things we are trying to do in our economy.’ Chief among which is health care.

In a clear choice between guns or butter, Obey estimates ten years of war in Afghanistan will cost the same $900 million as providing a comprehensive health plan for all Americans. Unfortunately, chances of a war surtax passing Congress are nil. While the Afghan and Iraq wars are increasingly unpopular among Americans, a tax increase at a time of over 10 per cent unemployment will ignite the same kind of furious reaction that met President Obama’s proposed national health plan, and endanger Democrats facing midterm elections. As the Obama administration appears set to plunge deeper into the Afghan morass, the real costs of Afghanistan and Iraq are still being concealed from the public and Congress. The $200 billion annual cost for both wars is only a part of the growing expenses faced by Washington.

The annual bill for US intelligence, which employs over 200,000 people, has doubled to $75 billion, in large part to support foreign wars and operations against anti-US Muslim groups. Costs of occupying Afghanistan rose to $300 billion this year, and will increase sharply next year. Operations in Iraq will cost $684 billion in 2009.

Washington spends $25 billion funding foreign armies, the bulk of which goes to the Mideast, Afghanistan, Iraq and Pakistan. Aid to Islamabad will rise to $15 billion over the next five years, including secret ‘black’ payments.

The US supports 168,000 ‘contractors’ in Iraq, many of them gunmen. CIA runs 74,000 mercenaries in Afghanistan. The new fortified, 50 hectare US Embassy in Baghdad will cost $700 million; the new embassy in Islamabad, $800 billion. Islamic militants call them ‘crusader castles.’

Add to these costs the expense of maintaining fleets in the Gulf and Indian Ocean, and military bases in the Gulf and Diego Garcia to support operations in Iraq and Afghanistan; hugely expensive military airlift; $100 per liter fuel delivered to US forces in Afghanistan; and, of course, financial inducements to many smaller nations to send handfuls of troops to Afghanistan and Iraq.

Thus the real cost of Afghanistan and Iraq is much higher than $200 billion annually. Yet President Obama, heedless of such costs, appears determined to expand the Afghan War. It seems clear that ‘peace candidate’ Obama has fallen increasingly under the influence of America’s powerful military-industrial-financial complex and neoconservative ideologues. In short, the same calculus of forces that guided the Bush administration!

Even America’s mighty economy cannot for long support waging wars across the Muslim world. Unaffordable wars have been the ruin of many an empire, and the American Raj seems headed in the same direction.

Eric Margolis is a veteran US journalist who reported from the Middle East and Asia for nearly two decades

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UAE Offers Additional Funds to Banks

The UAE Central Bank said that local banks and branches of foreign banks can borrow funds, if needed, from a new funding facility it has set up to support the banking system.

“(The) Central Bank of the UAE ….stands behind UAE banks and branches of foreign banks operating in the UAE,” said a central bank statement. The bank said that it has issued a notice to all banks in the country about the new “special additional liquidity facility”, which it said would be linked to their current accounts at the central bank, at the rate of 50 basis points above the three-month Emirates Interbank Offered Rates or EIBOR.

The statement came days after the government of Dubai announced its intention to seek a six-month delay in debt payments for its flagship Dubai World conglomerate, saying the restructuring plan was aimed at ensuring the group’s long-term success.

The new facility would be in addition to emergency funding facilities the central bank and the federal finance ministry had announced late last year to help fend off the impact of the global credit crisis. The central bank had set up a $13.6 billion emergency bank lending facility in November 2008, followed by the finance ministry, which injected two tranches of $6.8 billion each into bank deposits from a $19 billion rescue facility.

The central bank said on Sunday that the country’s retail commercial banking system has a strong and stable deposit base and has weathered the global financial crisis better than any other.

“The UAE banking system is more sound and liquid than a year ago, with foreign interbank deposits and Medium Terms Notes, or MTNs, and Euro Commercial Papers or ECPs, issued by UAE banks stand reduced by 25 per cent,” the statement said in an apparent attempt to boost confidence in the country’s financial industry.

“From the consolidated balance-sheet of banks, interbank deposits of the UAE banking system constitute 10.3 per cent of the liabilities side, with foreign interbank deposits constituting five per cent per cent only,” it said.

A senior banker said the move appears to be a “wise precautionary measure”, which would give a strong signal to the market that the central bank stands behind the banking system. “The banking system at present is quite strong with substantial liquidity circulating in the system”, he said.

“Since the central bank is bank’s last resort, its policy announcement that it stands behind UAE banks and branches of foreign banks is a very strong message to the businesses, at a time when they really need reassurance,” said Dr Qaiser Anis, a chartered accountant based in Abu Dhabi.

The move is not only calculated but very timely as well, he said. Government had also guaranteed bank deposits for three years, starting from September last year, so there is nothing to worry about the financial system, the chartered accountant said.

Bankers said the central bank wants to ensure that late last week’s volatility in the global markets do not spill over into the UAE.

“This will support the liquidity and soundness of the banking system in the UAE and especially in Dubai. The central bank is sending a strong message to everyone that they are providing ample liquidity and the guarantee to banks in the UAE,” said John Sfakianakis, chief economist at Banque Saudi Fransi-Credit Agricole Group in Riyadh.

Stock markets in Asia fell for a second day on Friday as investors dumped shares in banks and construction firms seen as exposed to Dubai. However, European shares, which fell in early trading on Friday, regained their poise later in the day.

Shares on Wall Street, which was closed on Thursday for the US Thanksgiving holiday, opened lower but firmed up early in Friday’s trading session. The New York Stock Exchange fell initially by 2.7 per cent from Wednesday’s close, while the Nasdaq was down by 2.3per cent.

Credit-rating agency Standard & Poor’s placed four Dubai-based banks on its “credit watch” list late on Thursday, shortly after cutting the debt ratings for several Dubai government-owned and related companies. S&P said it was concerned about the banks’ high exposure to Dubai World.

Markets recoiled after the Department of Finance announced on Wednesday that Dubai World would be seeking to postpone its debt payments until May 30, 2010. Dubai World owes $59 billion in debts.

Its property subsidiary Nakheel is due to repay a $3.52 billion Islamic bond in December. Bank of America-Merrill Lynch estimated that Dubai entities will owe total debt payments of $3.8 billion this year, $12.3 billion in 2010, $19.0 billion in 2011 and $18.0 billion in 2012.

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Saturday, November 21, 2009

Ahmed Humaid al Tayer Appointed Head of the DIFC

The newly appointed governor of the Dubai International Financial Centre (DIFC) has pledged to build on its success in promoting Dubai as a vital hub for capital and investment.

Sheikh Mohammed bin Rashid, Vice President of the UAE and Ruler of Dubai, on Saturday issued a decree naming Ahmed Humaid al Tayer to replace Omar bin Sulaiman, who had led the DIFC since its creation in late 2004.

“We are here to establish an international financial centre for the UAE, to serve the region and to co-operate with other centres from Hong Kong to Frankfurt and London,” said Mr al Tayer, who is also the chairman of Emirates NBD, the largest UAE bank by assets.

His appointment followed an announcement last week that Sheikh Mohammed had named himself and two family members to replace three of Dubai’s most prominent officials on the board of the Investment Corporation of Dubai (ICD), the main government asset-management vehicle.

Bankers and analysts downplayed suggestions in international reports that the appointments represented demotions or signified a political schism.

While the crisis has raised criticisms about the borrowing used to slingshot Dubai’s growth earlier this decade, they said the transfers were part of a broader financial restructuring to help refinance the roughly US$10 billion (Dh36.73bn) in debts that Dubai needs to repay next year. That sum is part of an estimated $85bn in total debts owed by the Dubai Government and the companies it controls.

Mr bin Sulaiman will remain the deputy chairman of the Central Bank, a spokesman for the regulator confirmed. The Central Bank has lent Dubai $10bn for the Dubai Financial Support Fund, which is overseeing efforts to restructure the emirate’s debts.

The three remaining officials also retained key positions. Mohammed al Gergawi, who was removed from the ICD board, also serves as the chairman of Dubai Holding, which manages the personal wealth of Sheikh Mohammed. He is also the Minister of Cabinet Affairs.

A second ICD board member replaced last week, Mohammed Alabbar, remained the chairman of Emaar Properties, the government-controlled developer, as well as the chairman of the Dubai Economic Advisory Council.

The third former ICD board member, Sultan Ahmed bin Sulayem, remained the chairman of Dubai World, the government-owned holding company that controls DP World and owns another key Dubai developer, Nakheel Development.

“Every board member who is leaving and coming, their contribution is highly appreciated,” Mr al Tayer said yesterday. “We are always soldiers to this country, to serve our country.”

The DIFC is in many ways an emblem of Dubai’s achievements. Established in 2002, the organisation is one of Dubai’s Government-owned free zones, designed specifically to position the emirate as a hub for financial services and investment.

In addition to not having taxes on income or profits, the DIFC offers 100 per cent foreign ownership, while the UAE as a whole still requires that companies be at least 51 per cent Emirati owned.

“The fact that Dubai is established as one of the major financial centres of the world is testament to the vision of the local authorities and the investment made in physical infrastructure and people skills,” said Peter Gotke, a vice president at The Bank of New York Mellon, which like many major banks has its offices in the DIFC.

“Whilst the DIFC lives that vision, the regulators and authorities have continued to evolve laws and access to make the region accessible and liquid.”

The DIFC, like many Dubai Government-controlled entities, became highly leveraged in the course of its expansion. As a real estate development, however, DIFC is doing relatively well, analysts say.

Despite financial difficulties faced by many tenants, there is still a waiting list of at least 400 wanting to take up space, said a report last month by the ratings agency Standard and Poor’s.

DIFC racked up further debts when it paid $630 million in early 2006 for a 3.5 per cent stake in the European stock-exchange operator Euronext, which gave it a 2 per cent stake in NASDAQ Dubai. DIFC also owns one-fifth of Borse Dubai, the holding company for both NASDAQ Dubai and the city’s larger stock exchange, the Dubai Financial Market.

DIFC bought a 2.2 per cent stake in Deutsche Bank in early 2007 and also owns stakes in Dubai Aerospace and in the private equity firm Abraaj Capital. DIFC typically financed these investments with private equity-style leverage, Standard and Poor’s said, paying for about a fifth of the investment in cash and borrowing the remainder.

That strategy left it vulnerable when the financial crisis started and credit for refinancing dried up. Standard and Poor’s said the DIFC had a debt-to-capital ratio of 76 per cent. The DIFC received a $1bn lifeline from the Dubai Department of Finance last year, which it used to repay $500m in loans.

The company is also due to repay a $350m loan this week. It has $1.25bn in debt due in mid-2012.

By: Wayne Arnold and Uta Harnischfeger - The National

uharnischfeger@thenational.ae

warnold@thenational.ae

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Saturday, November 14, 2009

GE pumps funds into wastewater research

General Electric (GE) is boosting research into recycled water, banking on the US$5 billion global market growing even bigger.

As rapidly increasing demand for water strains supplies across the Middle East, GE has announced that it will increase research spending on waste water filtration systems by 50 per cent, including at new research centres in Saudi Arabia and Singapore.

The US technology conglomerate has long been a major supplier of power generation equipment in the region, but now sees wastewater and water re-use systems as two of the “biggest opportunities” for growth, Steve Bolze, the head of the firm’s water and power equipment units, told Bloomberg.

GE, which has a number of business links to Mubadala Development, the strategic investment arm of the Abu Dhabi Government, will also conduct research on water technologies at an energy technology centre planned for Masdar City, the carbon-neutral development at the edge of the capital.

“We think it’s going to be a great business, not only in the US but in China,” said Jeffery Immelt, the chief executive of GE. “The entire Middle East is constrained so this is a problem that’s shared broadly.”

Experts say filtration and re-use of waste water for industry, irrigation and even household applications will receive more attention as rising consumption stretches the region’s water desalination capacity.

The International Energy Agency (IEA), a group of energy consuming nations that is based in Paris, predicts energy use will soar across the Middle East as demand for desalination doubles in the next 20 years. Of that new capacity, 70 per cent will be located in the Gulf states, Algeria and Libya, the IEA said.

The increasing amounts of energy used for desalination served as an incentive for greater use of recycled water, said Dieter Ernst, the chief executive of Berlinwasser, a German water company that operates a joint-venture firm in the UAE. “There’s a very strong link between energy consumption and water use,” Mr Ernst said. “The main question is what to do with it in the re-use cycle.”

Residents, he said, “are not so aware that water is a resource”.

Demand for water in Abu Dhabi is expected to double by 2030, according to a forecast presented last week by the Abu Dhabi Water and Electricity Company.

Faced with rising demand, the Government has moved to de-regulate the wastewater sector to encourage foreign investment and increase capacity for treatment and re-use of wastewater.

The emirate recycles 60 per cent of its water and has plans to increase the figure to 100 per cent, said Alan Thomson, the managing director of the Abu Dhabi Sewerage Services Company.

* with Bloomberg

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Transcript of President Obama's Asian-policy speech in Tokyo

The transcript of President Obama's 28-minute speech Saturday (Friday night in Washington) at Tokyo's Suntory Hall, where he discussed U.S.-Asia relations and the U.S.-Japan alliance before an invited audience.

Thank you so much. Arigatou. Thank you very much. (Applause.) Good morning. It is a great honor to be in Tokyo -- the first stop on my first visit to Asia as President of the United States. (Applause.) Thank you. It is good to be among so many of you -- Japanese and I see a few Americans here -- (applause) -- who work every day to strengthen the bonds between our two countries, including my longtime friend and our new ambassador to Japan, John Roos. (Applause.)

It is wonderful to be back in Japan. Some of you may be aware that when I was a young boy, my mother brought me to Kamakura, where I looked up at that centuries-old symbol of peace and tranquility -- the great bronze Amida Buddha. And as a child, I was more focused on the matcha ice cream. (Laughter.) And I want to thank Prime Minister Hatoyama for sharing some of those memories with more ice cream last night at dinner. (Laughter and applause.) Thank you very much. But I have never forgotten the warmth and the hospitality that the Japanese people showed a young American far from home.

And I feel that same spirit on this visit: In the gracious welcome of Prime Minister Hatoyama. In the extraordinary honor of the meeting with Their Imperial Majesties, the Emperor and Empress, on the 20th anniversary of his ascension to the Chrysanthemum Throne. In the hospitality shown by the Japanese people. And of course, I could not come here without sending my greetings and gratitude to the citizens of Obama, Japan. (Applause.)

Now, I am beginning my journey here for a simple reason. Since taking office, I have worked to renew American leadership and pursue a new era of engagement with the world based on mutual interests and mutual respect. And our efforts in the Asia Pacific will be rooted, in no small measure, through an enduring and revitalized alliance between the United States and Japan.

From my very first days in office, we have worked to strengthen the ties that bind our nations. The first foreign leader that I welcomed to the White House was the Prime Minister of Japan, and for the first time in nearly 50 years, the first foreign trip by an American Secretary of State, Hillary Clinton, was to Asia, starting in Japan. (Applause.)

In two months, our alliance will mark its 50th anniversary -- a day when President Dwight Eisenhower stood next to Japan's Prime Minister and said that our two nations were creating "an indestructible partnership" based on "equality and mutual understanding."

In the half-century since, that alliance has endured as a foundation for our security and prosperity. It has helped us become the world's two largest economies, with Japan emerging as America's second-largest trading partner outside of North America. It has evolved as Japan has played a larger role on the world stage, and made important contributions to stability around the world -- from reconstruction in Iraq, to combating piracy off the Horn of Africa, to assistance for the people of Afghanistan and Pakistan -- most recently through its remarkable leadership in providing additional commitments to international development efforts there.

Above all, our alliance has endured because it reflects our common values -- a belief in the democratic right of free people to choose their own leaders and realize their own dreams; a belief that made possible the election of both Prime Minister Hatoyama and myself on the promise of change. And together, we are committed to providing a new generation of leadership for our people and our alliance.

That is why, at this critical moment in history, the two of us have not only reaffirmed our alliance -- we've agreed to deepen it. We've agreed to move expeditiously through a joint working group to implement the agreement that our two governments reached on restructuring U.S. forces in Okinawa. And as our alliance evolves and adapts for the future, we will always strive to uphold the spirit that President Eisenhower described long ago -- a partnership of equality and mutual respect. (Applause.)

But while our commitment to this region begins in Japan, it doesn't end here. The United States of America may have started as a series of ports and cities along the Atlantic Ocean, but for generations we have also been a nation of the Pacific. Asia and the United States are not separated by this great ocean; we are bound by it. We are bound by our past -- by the Asian immigrants who helped build America, and the generations of Americans in uniform who served and sacrificed to keep this region secure and free. We are bound by our shared prosperity -- by the trade and commerce upon which millions of jobs and families depend. And we are bound by our people -- by the Asian Americans who enrich every segment of American life, and all the people whose lives, like our countries, are interwoven.

My own life is a part of that story. I am an American President who was born in Hawaii and lived in Indonesia as a boy. My sister Maya was born in Jakarta, and later married a Chinese-Canadian. My mother spent nearly a decade working in the villages of Southeast Asia, helping women buy a sewing machine or an education that might give them a foothold in the world economy. So the Pacific Rim has helped shape my view of the world.

And since that time, perhaps no region has changed as swiftly or dramatically. Controlled economies have given way to open markets. Dictatorships have become democracies. Living standards have risen while poverty has plummeted. And through all these changes, the fortunes of America and the Asia Pacific have become more closely linked than ever before.

So I want everyone to know, and I want everybody in America to know, that we have a stake in the future of this region, because what happens here has a direct effect on our lives at home. This is where we engage in much of our commerce and buy many of our goods. And this is where we can export more of our own products and create jobs back home in the process. This is a place where the risk of a nuclear arms race threatens the security of the wider world, and where extremists who defile a great religion plan attacks on both our continents. And there can be no solution to our energy security and our climate challenge without the rising powers and developing nations of the Asia Pacific.

To meet these common challenges, the United States looks to strengthen old alliances and build new partnerships with the nations of this region. To do this, we look to America's treaty alliances with Japan, South Korea, Australia, Thailand and the Philippines -- alliances that are not historical documents from a bygone era, but abiding commitments to each other that are fundamental to our shared security.

These alliances continue to provide the bedrock of security and stability that has allowed the nations and peoples of this region to pursue opportunity and prosperity that was unimaginable at the time of my first childhood visit to Japan. And even as American troops are engaged in two wars around the world, our commitment to Japan's security and to Asia's security is unshakeable -- (applause) -- and it can be seen in our deployments throughout the region -- above all, through our young men and women in uniform, of whom I am so proud.

Now, we look to emerging nations that are poised as well to play a larger role -- both in the Asia Pacific region and the wider world; places like Indonesia and Malaysia that have adopted democracy, developed their economies, and tapped the great potential of their own people.

We look to rising powers with the view that in the 21st century, the national security and economic growth of one country need not come at the expense of another. I know there are many who question how the United States perceives China's emergence. But as I have said, in an interconnected world, power does not need to be a zero-sum game, and nations need not fear the success of another. Cultivating spheres of cooperation -- not competing spheres of influence -- will lead to progress in the Asia Pacific. (Applause.)

Now, as with any nation, America will approach China with a focus on our interests. And it's precisely for this reason that it is important to pursue pragmatic cooperation with China on issues of mutual concern, because no one nation can meet the challenges of the 21st century alone, and the United States and China will both be better off when we are able to meet them together. That's why we welcome China's effort to play a greater role on the world stage -- a role in which their growing economy is joined by growing responsibility. China's partnership has proved critical in our effort to jumpstart economic recovery. China has promoted security and stability in Afghanistan and Pakistan. And it is now committed to the global nonproliferation regime, and supporting the pursuit of denuclearization of the Korean Peninsula.

So the United States does not seek to contain China, nor does a deeper relationship with China mean a weakening of our bilateral alliances. On the contrary, the rise of a strong, prosperous China can be a source of strength for the community of nations.

And so in Beijing and beyond, we will work to deepen our strategic and economic dialogue, and improve communication between our militaries. Of course, we will not agree on every issue, and the United States will never waver in speaking up for the fundamental values that we hold dear -- and that includes respect for the religion and cultures of all people -- because support for human rights and human dignity is ingrained in America. But we can move these discussions forward in a spirit of partnership rather than rancor.

In addition to our bilateral relations, we also believe that the growth of multilateral organizations can advance the security and prosperity of this region. I know that the United States has been disengaged from many of these organizations in recent years. So let me be clear: Those days have passed. As a Asia Pacific nation, the United States expects to be involved in the discussions that shape the future of this region, and to participate fully in appropriate organizations as they are established and evolve. (Applause.)

That is the work that I will begin on this trip. The Asia Pacific Economic Cooperation forum will continue to promote regional commerce and prosperity, and I look forward to participating in that forum this evening. ASEAN will remain a catalyst for Southeast Asian dialogue, cooperation and security, and I look forward to becoming the first American President to meet with all 10 ASEAN leaders. (Applause.) And the United States looks forward to engaging with the East Asia Summit more formally as it plays a role in addressing the challenges of our time.

We seek this deeper and broader engagement because we know our collective future depends on it. And I'd like to speak for a bit about what that future might look like, and what we must do to advance our prosperity, our security, and our universal values and aspirations.

First, we must strengthen our economic recovery, and pursue growth that is both balanced and sustained.

The quick, unprecedented and coordinated action taken by Asia Pacific nations and others has averted economic catastrophe, and helped us to begin to emerge from the worst recession in generations. And we have taken the historic step of reforming our international economic architecture, so that the G20 is now the premier forum for international economic cooperation.

Now, this shift to the G20, along with the greater voice that is being given to Asian nations in international financial institutions, clearly demonstrates the broader, more inclusive engagement that America seeks in the 21st century. And as a key member of the G8, Japan has and will continue to play a leading and vital role in shaping the future of the international financial architecture. (Applause.)

Now that we are on the brink of economic recovery, we must also ensure that it can be sustained. We simply cannot return to the same cycles of boom and bust that led to a global recession. We can't follow the same policies that led to such imbalanced growth. One of the important lessons this recession has taught us is the limits of depending primarily on American consumers and Asian exports to drive growth -- because when Americans found themselves too heavily in debt or lost their jobs and were out of work, demand for Asian goods plummeted. When demand fell sharply, exports from this region fell sharply. Since the economies of this region are so dependent on exports, they stopped growing. And the global recession only deepened.

So we have now reached one of those rare inflection points in history where we have the opportunity to take a different path. And that must begin with the G20 pledge that we made in Pittsburgh to pursue a new strategy for balanced economic growth.

I'll be saying more about this in Singapore, but in the United States, this new strategy will mean that we save more and spend less, reform our financial systems, reduce our long-term deficit and borrowing. It will also mean a greater emphasis on exports that we can build, produce, and sell all over the world. For America, this is a jobs strategy. Right now, our exports support millions upon millions of well-paying American jobs. Increasing those exports by just a small amount has the potential to create millions more. These are jobs making everything from wind turbines and solar panels to the technology that you use every day.

For Asia, striking this better balance will provide an opportunity for workers and consumers to enjoy higher standards of living that their remarkable increases in productivity have made possible. It will allow for greater investments in housing and infrastructure and the service sector. And a more balanced global economy will lead to prosperity that reaches further and deeper.

For decades, the United States has had one of the most open markets in the world, and that openness has helped to fuel the success of so many countries in this region and others over the last century. In this new era, opening other markets around the globe will be critical not just to America's prosperity, but to the world's, as well.

An integral part of this new strategy is working towards an ambitious and balanced Doha agreement -- not any agreement, but an agreement that will open up markets and increase exports around the world. We are ready to work with our Asian partners to see if we can achieve that objective in a timely fashion -- and we invite our regional trading partners to join us at the table.

We also believe that continued integration of the economies of this region will benefit workers, consumers, and businesses in all our nations. Together, with our South Korean friends, we will work through the issues necessary to move forward on a trade agreement with them. The United States will also be engaging with the Trans-Pacific Partnership countries with the goal of shaping a regional agreement that will have broad-based membership and the high standards worthy of a 21st century trade agreement.

Working in partnership, this is how we can sustain this recovery and advance our common prosperity. But it's not enough to pursue growth that is balanced. We also need growth that is sustainable -- for our planet and the future generations that will live here.

Already, the United States has taken more steps to combat climate change in 10 months than we have in our recent history -- (applause) -- by embracing the latest science, by investing in new energy, by raising efficiency standards, forging new partnerships, and engaging in international climate negotiations. In short, America knows there is more work to do -- but we are meeting our responsibility, and will continue to do so.

And that includes striving for success in Copenhagen. I have no illusions that this will be easy, but the contours of a way forward are clear. All nations must accept their responsibility. Those nations, like my own, who have been the leading emitters must have clear reduction targets. Developing countries will need to take substantial actions to curb their emissions, aided by finance and technology. And there must be transparency and accountability for domestic actions.

Each of us must do what we can to grow our economies without endangering our planet -- and we must do it together. But the good news is that if we put the right rules and incentives in place, it will unleash the creative power of our best scientists, engineers, and entrepreneurs. It will lead to new jobs, new businesses, and entire new industries. And Japan has been at the forefront on this issue. We are looking forward to being a important partner with you as we achieve this critical global goal. (Applause.)

Yet, even as we confront this challenge of the 21st century, we must also redouble our efforts to meet a threat to our security that is the legacy of the 20th century -- the danger posed by nuclear weapons.

In Prague, I affirmed America's commitment to rid the world of nuclear weapons, and laid out a comprehensive agenda to pursue this goal. (Applause.) I am pleased that Japan has joined us in this effort, for no two nations on Earth know better what these weapons can do, and together we must seek a future without them. This is fundamental to our common security, and this is a great test of our common humanity. Our very future hangs in the balance.

Now, let me be clear: So long as these weapons exist, the United States will maintain a strong and effective nuclear deterrent that guarantees the defense of our allies -- including South Korea and Japan. (Applause.)

But we must recognize that an escalating nuclear arms race in this region would undermine decades of growth and prosperity. So we are called upon to uphold the basic bargain of the Nuclear Non-Proliferation Treaty -- that all nations have a right to peaceful nuclear energy; that nations with nuclear weapons have a responsibility to move toward nuclear disarmament; and those without nuclear weapons have a responsibility to forsake them.

Indeed, Japan serves as an example to the world that true peace and power can be achieved by taking this path. (Applause.) For decades, Japan has enjoyed the benefits of peaceful nuclear energy, while rejecting nuclear arms development -- and by any measure, this has increased Japan's security and enhanced its position.

To meet our responsibilities and to move forward with the agenda I laid out in Prague, we have passed, with the help of Japan, a unanimous U.N. Security Council resolution embracing this international effort. We are pursuing a new agreement with Russia to reduce our nuclear stockpiles. We will work to ratify and bring into force the test ban treaty. (Applause.) And next year at our Nuclear Security Summit, we will advance our goal of securing all the world's vulnerable nuclear materials within four years.

Now, as I've said before, strengthening the global nonproliferation regime is not about singling out any individual nations. It's about all nations living up to their responsibilities. That includes the Islamic Republic of Iran. And it includes North Korea.

For decades, North Korea has chosen a path of confrontation and provocation, including the pursuit of nuclear weapons. It should be clear where this path leads. We have tightened sanctions on Pyongyang. We have passed the most sweeping U.N. Security Council resolution to date to restrict their weapons of mass destruction activities. We will not be cowed by threats, and we will continue to send a clear message through our actions, and not just our words: North Korea's refusal to meet its international obligations will lead only to less security -- not more.

Yet there is another path that can be taken. Working in tandem with our partners -- supported by direct diplomacy -- the United States is prepared to offer North Korea a different future. Instead of an isolation that has compounded the horrific repression of its own people, North Korea could have a future of international integration. Instead of gripping poverty, it could have a future of economic opportunity -- where trade and investment and tourism can offer the North Korean people the chance at a better life. And instead of increasing insecurity, it could have a future of greater security and respect. This respect cannot be earned through belligerence. It must be reached by a nation that takes its place in the international community by fully living up to its international obligations.

So the path for North Korea to realize this future is clear: a return to the six-party talks; upholding previous commitments, including a return to the Nuclear Non-Proliferation Treaty; and the full and verifiable denuclearization of the Korean Peninsula. And full normalization with its neighbors can also only come if Japanese families receive a full accounting of those who have been abducted. (Applause.) These are all steps that can be taken by the North Korean government if they are interested in improving the lives of their people and joining the community of nations.

And as we are vigilant in confronting this challenge, we will stand with all of our Asian partners in combating the transnational threats of the 21st century: by rooting out the extremists who slaughter the innocent, and stopping the piracy that threatens our sea lanes; by enhancing our efforts to stop infectious disease, and working to end extreme poverty in our time; and by shutting down the traffickers who exploit women, children and migrants, and putting a stop to this scourge of modern-day slavery once and for all. Indeed, the final area in which we must work together is in upholding the fundamental rights and dignity of all human beings.

The Asia Pacific region is rich with many cultures. It is marked by extraordinary traditions and strong national histories. And time and again, we have seen the remarkable talent and drive of the peoples of this region in advancing human progress. Yet this much is also clear -- indigenous cultures and economic growth have not been stymied by respect for human rights; they have been strengthened by it. Supporting human rights provides lasting security that cannot be purchased in any other way -- that is the story that can be seen in Japan's democracy, just as it can be seen in America's democracy.

The longing for liberty and dignity is a part of the story of all peoples. For there are certain aspirations that human beings hold in common: the freedom to speak your mind, and choose your leaders; the ability to access information, and worship how you please; confidence in the rule of law, and the equal administration of justice. These are not impediments to stability, they are the cornerstones of stability. And we will always stand on the side of those who seek these rights.

That truth, for example, guides our new approach to Burma. Despite years of good intentions, neither sanctions by the United States nor engagement by others succeeded in improving the lives of the Burmese people. So we are now communicating directly with the leadership to make it clear that existing sanctions will remain until there are concrete steps toward democratic reform. We support a Burma that is unified, peaceful, prosperous, and democratic. And as Burma moves in that direction, a better relationship with the United States is possible.

There are clear steps that must be taken -- the unconditional release of all political prisoners, including Aung San Suu Kyi; an end to conflicts with minority groups; and a genuine dialogue between the government, the democratic opposition and minority groups on a shared vision for the future. That is how a government in Burma will be able to respond to the needs of its people. That is the path that will bring Burma true security and prosperity. (Applause.)

These are steps that the United States will take to improve prosperity, security, and human dignity in the Asia Pacific. We will do so through our close friendship with Japan -- which will always be a centerpiece of our efforts in the region. We will do so as a partner -- through the broader engagement that I've discussed today. We will do so as a Pacific nation -- with a President who was shaped in part by this piece of the globe. And we will do so with the same sense of purpose that has guided our ties with the Japanese people for nearly 50 years.

The story of how these ties were forged dates back to the middle of the last century, sometime after the guns of war had quieted in the Pacific. It was then that America's commitment to the security and stability of Japan, along with the Japanese peoples' spirit of resilience and industriousness, led to what's been called "the Japanese miracle" -- a period of economic growth that was faster and more robust than anything the world had seen for some time.

In the coming years and decades, this miracle would spread throughout the region, and in a single generation the lives and fortunes of millions were forever changed for the better. It is progress that has been supported by a hard-earned peace, and strengthened by new bridges of mutual understanding that have bound together the nations of this vast and sprawling space.

But we know that there's still work to be done -- so that new breakthroughs in science and technology can lead to jobs on both sides of the Pacific, and security from a warming planet; so that we can reverse the spread of deadly weapons, and -- on a divided peninsula -- the people of South can be freed from fear, and those in the North can live free from want; so that a young girl can be valued not for her body but for her mind; and so that young people everywhere can go as far as their talent and their drive and their choices will take them.

None of this will come easy, nor without setback or struggle. But at this moment of renewal -- in this land of miracles -- history tells us it is possible. This is the --America's agenda. This is the purpose of our partnership with Japan, and with the nations and peoples of this region. And there must be no doubt: As America's first Pacific President, I promise you that this Pacific nation will strengthen and sustain our leadership in this vitally important part of the world.

Thank you very much.



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