Thailand Declares State of Emergency


Thai protesters face riot police inside the Government House compound in Bangkok on Aug. 29, 2008. Photographer: Udo Weitz/Bloomberg News

Sept. 2 (Bloomberg) — Thai Prime Minister Samak Sundaravej declared a state of emergency in Bangkok after street clashes early today left one dead and 43 injured, authorizing the army to help end four months of protests against his government.

``We can’t let the protests go on,” Samak said at a press briefing at military headquarters in the Thai capital. “I am acting to defuse the problem.”

Pro-government demonstrators wielding knives, swords and metal bars earlier marched to Government House to confront the People’s Alliance for Democracy, which has occupied Samak’s office compound for a week. Samak’s supporters broke through two lines of unarmed police before reaching the anti-government protesters, who charged at them with weapons and fired gunshots.

Read moreThailand Declares State of Emergency

Thailand sinks into crisis as demonstrators close airports and railways


Unions urged airline and railway workers to take “sick leave” to support the protests (Sakchai Lalit/AP)

Thailand sank deeper into political chaos yesterday as anti-government demonstrators forced the closure of airports and railway lines, stranding foreign and domestic passengers and increasing fears of yet another military coup.

In the capital, Bangkok, a crowd of 2,000 people faced a barrage of teargas as they attempted to take over police headquarters. In other parts of the country, members of the People’s Alliance for Democracy (PAD) demanding the resignation of Prime Minister Samak Sundaraveg shut down airports in Hat Yai and the tourist resorts of Phuket and Krabi.

“This is embarrassing in front of the world,” Mr Samak said, three days after being forced out of his office by demonstrators. “I have several tools at my disposal, but I am not using any of them because I want to keep things calm. I will not quit. If you want me out, do it by law, not by force.”

Read moreThailand sinks into crisis as demonstrators close airports and railways

Rat meat in demand in Cambodia as inflation bites

PHNOM PENH (Reuters) – The price of rat meat has quadrupled in Cambodia this year as inflation has put other meat beyond the reach of poor people, officials said on Wednesday.

With consumer price inflation at 37 percent according to the latest central bank estimate, demand has pushed a kilogram of rat meat up to around 5,000 riel (69 pence) from 1,200 riel last year.

Spicy field rat dishes with garlic thrown in have become particularly popular at a time when beef costs 20,000 riel a kg.

Read moreRat meat in demand in Cambodia as inflation bites

Emerging markets face inflation meltdown


Downward spiral: Chinese stocks have slumped by almost 50pc since October while Mumbai’s BSE index has lost 27pc of its value

Central banks across much of Asia, Latin America, and Eastern Europe will soon have to jam on the breaks or risk a serious crisis as inflation spirals into the danger zone. As the stark reality becomes ever clearer, this year’s correction in emerging market bourses and bond markets has now accelerted into a full-fledged rout.

Shanghai’s composite index touched a fourteen-month low of 2,900 yesterday. It follows moves this week by the central bank raised reserve requirement yet again, draining a further $60bn from the banking system. Chinese stocks have now slumped by almost 50pc since peaking in October.

In India, Mumbai’s BSE index has lost 27pc of its value as the exodus of foreign funds accelerates. The central bank has raised rates to 8pc to curb inflation and halt a run on the rupee, but critics still say the country waited too long to tackle overheating. The current account deficit has shot up to near 3.5pc of GDP. A plethora of subsidies has pushed the budget deficit to 9pc of GDP.

Russia, Brazil, India, Vietnam, South Africa, Indonesia, Nigeria, and Chile – among others – have all had to raise interest rates or tighten monetary policy in recent days. Most are still behind the curve.

“The inflation genie is out of the bottle: easy money is the culprit,” said Joachim Fels, chief economist at Morgan Stanley.

“Weighted global interest rates are 4.3pc, while global inflation is above 5pc. The real policy rate in the world is negative,” he said
advertisement

The currencies of Korea, Thailand, the Philippines, and Malaysia have come under pressure this week as investors scramble for dollars in moves that echo the East Asia crisis in 1997-1998. Several countries have had to intervene to slow the currency slide.

The sudden shift in sentiment appears to follow comments by Ben Bernanke and Tim Geithner, the heads of the US Federal Reserve and the New York Fed, leaving no doubt that Washington has lost patience with the crumbling dollar.

It is almost unprecedented for Fed officials to take a public stand on the Greenback. The orchestrated move is clearly aimed at halting the vicious circle in the oil markets, where crude prices are feeding off dollar weakness – with multiples of leverage.

The “strong dollar” campaign has switched into high gear. US Treasury Secretary Hank Paulson has conducted an aggressive lobbying drive behind the scenes in the Middle East and Asia. America’s friends and foes have been left in no doubt that the enormous strategic might of the United States is now firmly behind the currency. From now on, they cross Washington at their peril.

The markets are now pricing in two rate rises by the Fed this year. Investors no longer doubt that the US – and Europe – will do what is needed to restore credibility. This display of resolve has suddenly switched the focus to the very different universe of emerging markets, where a host of countries have repeated the errors of the 1970s.

Richard Cookson, a strategist at HSBC, advises clients to slash their holdings in these regions.

“Inflation looks like a very real problem in Asia, and the risk is that investors will lose faith in the region’s currencies. Although markets have fallen savagely from their peaks, they’re still looking pricey. We’ re lopping exposure even further, to zero,” he said.

“Where to put the money? We think corporate debt is stunningly cheap compared with equities. Seven-year to ten-year ‘BBB’ [rated] corporate bonds in the US haven’t been this cheap since the Autumn of 2002,” he said.

“Until and unless policy makers in the emerging world – especially those in China – tighten policy dramatically, the inflation rates are unlikely to fall much. Our guess is that most don’t have much will to tighten pre-emptively,” he said.

Russia’s inflation is 15.1pc, yet interest rates are 10.75pc. Vietnam’s inflation is 25pc; rates are 12pc. Fitch Ratings has put the country on negative watch and warns of brewing trouble in the Ukraine, Kazakhstan, the Balkans, and the Baltic states. The long-held assumption that emerging markets are strong enough to shrug off US troubles is now facing a serious test. The World Bank has slashed its global growth forecast to 2.7pc this year. The IMF and the World Bank define growth below 3pc a “global recession”.

There is a dawning realization that China is facing a major storm as inflation (7.7pc), the rising yuan (up 5pc this year), soaring oil prices, and an economic downturn in the key export markets of North America and Europe all combine to crush profit margins. China uses five times as much energy as the US to produce a unit of GDP. It is acutely vulnerable to the energy crisis.

A quarter of the 800 shoe factories in the Guangdong region have shut down in recent months, and several thousand textile workshops are battling to stay afloat. Hong Kong’s industry federation has warned that 10,000 firms operating in the South of China may soon go out of business.

By Ambrose Evans-Pritchard
Last Updated: 13/06/2008

Source: Telegraph

How Japan Helped Ease the Rice Crisis

Prices quickly fell on Tokyo’s call to tap into its huge reserves. But how did the stash get so big, and why does rice-rich Japan import the staple?

With prices now falling, the global rice crisis seems to be subsiding. That’s thanks in part to a policy announcement by a Japanese bureaucrat. On May 19, Japan’s Deputy Agriculture Minister, Toshiro Shirasu, said that Tokyo would release some of its massive stockpile of rice to the Philippines, selling 50,000 tons “as soon as possible” and releasing another 200,000 tons as food aid. The first shipment could reach the Philippines by late summer. Shirasu also left open the possibility of using more of its reserves to help other countries in need.

To understand Japan’s role in deflating the rice market, it helps to visit the warehouses rimming Tokyo Bay. It’s here in temperature-controlled buildings that Japan keeps millions of 30-kilogram vinyl bags of rice that it imports every year. Tokyo doesn’t need rice from the outside world: The country’s heavily subsidized farmers produce more than enough to feed the country’s 127 million people. Yet every year since 1995, Tokyo has bought hundreds of thousands of metric tons of rice from the U.S., Thailand, Vietnam, China, and Australia.

A Rice Imbalance

Why does Japan buy rice it doesn’t need or want? In order to follow World Trade Organization rules, which date to 1995 and are aimed at opening the country’s rice market. The U.S. fought for years to end Japanese rice protectionism, and getting Tokyo to agree to import rice from the U.S. and elsewhere was long a goal of American trade policy. But while the Japanese have been buying rice from farms in China and California for more than a decade, almost no imports ever end up on dinner plates in Japan. Instead the imported rice is sent as food aid to North Korea, added to beer and rice cakes, or mixed with other grains to feed pigs and chickens. Or it just sits in storage for years. As of last October, Japan’s warehouses were bulging with 2.6 million tons of surplus rice, including 1.5 million tons of imported rice, 900,000 tons of it American medium-grain rice.

Read moreHow Japan Helped Ease the Rice Crisis

Rotting corpses pile up as Myanmar stalls on aid

(CNN puplished this article (check the title with google) but has it entirely rewritten just a few minutes ago. – The Infinite Unknown)

YANGON, Myanmar (CNN) — Myanmar’s cyclone survivors have insufficient fuel to burn the rotting corpses of the dead as the ruling military junta is accused of being too slow in letting aid groups into the country.

Relief agencies say decomposing corpses litter ditches and fields in the worst-hit Irrawaddy delta area as survivors try to conserve fuel for transporting much-needed supplies.

The international community is growing increasingly frustrated with the junta’s lack of progress in granting visas for relief workers and giving clearance for aid flights to land.

They are concerned the lack of medical supplies and clean food and water threatens to increase the already staggering death toll.

Read moreRotting corpses pile up as Myanmar stalls on aid

Myanmar – Official: Storm toll could be 100,000


Officials say corpses are floating in the water as Myanmar disaster grows
YANGON, Myanmar – Bodies floated in flood waters and survivors tried to reach dry ground on boats using blankets as sails, while the top U.S. diplomat in Myanmar said Wednesday that up to 100,000 people may have died in the devastating cyclone.

Hungry crowds stormed the few shops that opened in the country’s stricken Irrawaddy delta, sparking fist fights, according to Paul Risley, a spokesman for the U.N. World Food Program in neighboring Thailand.

Shari Villarosa, who heads the U.S. Embassy in Myanmar, said food and water are running short in the delta area and called the situation there “increasingly horrendous.”

“There is a very real risk of disease outbreaks as long as this continues,” Villarosa told reporters. Some 1 million people were homeless in the Southeast Asian country, the U.N. said.

Read moreMyanmar – Official: Storm toll could be 100,000

The food crisis begins to bite

Rioting in Haiti. Rationing in America. Queues in Egypt. Protests in Afghanistan. As the price of food continues to soar, the impact is being felt by people around the globe

CHINA

The roaring economy and an ever expanding middle class have had a particularly profound effect on food prices, particularly rice and wheat. Because of industrialisation, rice planting fell from 33 million hectares in 1983 to 29 million by 2006 and China now imports more than ever, placing a major strain on international supplies. Despite freezing prices, rampant inflation means the cost of food has risen by 21 per cent this year.

USA

In a land where supposedly the rich are thin and the poor are overweight, one of the largest cash and carry stores, Sam’s Club, announced this week it would limit customers to take home a maximum of four bags of rice. The move came a day after Costco Wholesale Corp, the biggest US warehouse-club operator, limited bulk rice purchases in some stores and warned that customers had begun stockpiling certain goods.

NORTH KOREA

Even during times of relative stability, North Korea has shown itself to be inept at feeding its population. During the 1990s a famine caused by poor harvests killed an estimated two to three million people. On Wednesday the World Food Programme warned that the country could again be plunged into famine because of the spiralling cost of rice and there was an estimated shortfall of 1.6 million tons of rice and wheat.

EGYPT

Up to 50 million Egyptians rely on subsidised bread and this year Cairo has estimated it will cost $2.5bn. But with the price of wheat rocketing in the past year there are fears the country has plunged into a “bread crisis”. Queues are now double the length they were a year ago. Inflation hit 12.1 per cent in February with prices for dairy goods up 20 per cent and cooking oils 40 per cent

VENEZUELA

Latin American countries were some of the first nations to voice their concern at rising wheat prices, particularly after thousands of people in Mexico took to the streets at the beginning of 2007 to take part in the so-called “Tortilla Protests”. This week the presidents of Bolivia, Nicaragua and Cuba’s vice-president flew to Caracas to announce a joint $100m scheme to combat the impact of rising food prices on the region’s poor.

BRAZIL

On Wednesday Brazil became the latest major rice producer to temporarily suspend exports because of soaring costs and domestic shortages. In recent weeks Latin American countries and African nations have asked for up to 500,000 tons of rice from Brazil which will now not be delivered. Brazil’s agricultural ministry has said it has to ensure that the country has at least enough rice reserves to last the next six to eight months.

IVORY COAST

Some of the worst instability resulting from high food prices has been felt in West Africa. One person was killed and dozens were injured last month as riots tore through Ivory Coast after the prices of meat and wheat increased by 50 per cent within a week. Ivorian President Laurent Gbagbo was forced to cut taxes to halt the disorder. Violent protests have also broken out in Cameroon, Burkina Faso and Senegal.

AFGHANISTAN

There have been street protests about the soaring cost of food in a country almost entirely reliant on imports of wheat. Already utterly impoverished, the plight of Afghans has worsened because Pakistan has cut its regular flour supply. The government has sought to assure citizens that there is sufficient food and has set aside $50m for additional imports. The price of wheat has risen by around 60 per cent in the last year.

THAILAND

The price of rice in the world’s largest exporter rose to $1,000 a ton yesterday and experts warned that it will continue to rise. This is because of the massive demand from the Philippines which is struggling to secure supplies after India and several other producers halted exports. The government has said it can meet the export requests. Indonesia has said it is withholding purchases for a year because prices are so high.

EAST AFRICA

Hundreds of thousands of poor Africans in Uganda and Sudan are to lose out on a vital source of food after one of the world’s largest humanitarian organisations said it was cutting aid to 1.5m people. Dave Toycen, president of World Vision Canada, blamed soaring costs and countries failing to live up to aid commitments for the fact that the number of people the charity can help will fall by almost a quarter.

INDIA

The country as added to the problems facing many countries in the region by halting its export of rice, except for its premium basmati product. This has left countries normally reliant on Indian exports, such as the Philippines, searching for alternative supplies. India has more than half of the world’s hungriest people and its priority is to safeguard domestic supply. But it too has watched as the cost of food has soared, not just rice but cooking oil, pulses and even vegetables. India has this year forecast a record grain harvest but experts warned farm productivity will have to rise much faster if the nation is to feed its 1.1bn people and avoid a food security crisis. Around two-thirds of India’s population are dependent on agriculture for their livelihoods but agriculture is growing much more slowly than the overall economy.

HAITI

The poorest country in the Western hemisphere has seen a three to four-fold increase in the number of so-called boat people trying to leave because of food shortages. Already gripped by wretched poverty, the food crisis triggered riots that led to the death of six people. Haiti’s wretched food security situation is a result of “liberalisation measures” forced on the country after former president Jean-Bertrand Aristide was returned to power.

THE PHILIPPINES

The government has been desperately trying to secure alternative sources of rice to counteract the decision of a number of nations to halt rice exports. The country’s National Food Authority, which handles rice imports for the government, has now said it plans to increase imports 42 per cent to 2.7m tons this year. This could cost $1.3bn if it does not increase the price of the subsidised rice it is selling to people. But the Philippines is responsible for producing 85 per cent of its own food and international experts believe the country will handle this crisis. The government has also been encouraging consumers and even fast food restaurants to be more frugal and be careful not to waste food. The government is confident it will be able to source sufficient supplies from Vietnam and Thailand.

EUROPE

Less vulnerable to food price fluctuations than emerging nations, but food prices across Europe have nonetheless increased. In Britain wholesale prices of food have increased by 7.4 per cent over the past 12 months, roughly three times the headline rate of inflation. According to the government’s own statistics grocery bills have gone up by an average of £750 over the same period, the equivalent of a 12 per cent rise.

By Jerome Taylor and Andrew Buncombe
Friday, 25 April 2008

Source: The Independent

Inflation hits consumers worldwide

(AXcess News) – Gas pumps in the United States tell the same story as rice prices in Thailand: Inflation is a global phenomenon this year.

Oil hit a record $112 per barrel this week, and a United Nations official warned of continued pressure on food prices, which by one index are up 45 percent in the past year.

The challenges are worst in developing nations, where raw materials account for a larger share of consumer spending. But another factor – the sagging value of the US dollar – means that imports cost more in America and other nations that peg their currencies to the dollar.

Still, regardless of this currency phenomenon, several broad forces are pushing prices up.

After years of strong global economic growth, prices of oil, grains, and some metals have spiked. Investors are adding fuel to that fire by buying up hard assets like commodities, which are viewed as a hedge against inflation.

More fundamentally, many nations have been relatively loose in the creation of money supply. For all the news about interest-rate cuts by the Federal Reserve, this trend goes well beyond US shores.

Read moreInflation hits consumers worldwide

Food riots fear after rice price hits a high

Shortages of the staple crop of half the world’s people could bring unrest across Asia and Africa, reports foreign affairs editor Peter Beaumont

A global rice shortage that has seen prices of one of the world’s most important staple foods increase by 50 per cent in the past two weeks alone is triggering an international crisis, with countries banning export and threatening serious punishment for hoarders.

With rice stocks at their lowest for 30 years, prices of the grain rose more than 10 per cent on Friday to record highs and are expected to soar further in the coming months. Already China, India, Egypt, Vietnam and Cambodia have imposed tariffs or export bans, as it has become clear that world production of rice this year will decline in real terms by 3.5 per cent. The impact will be felt most keenly by the world’s poorest populations, who have become increasingly dependent on the crop as the prices of other grains have become too costly.

Read moreFood riots fear after rice price hits a high