Archive for March 14th, 2008
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EU leaders urged international banks to help calm markets by revealing recent losses, wrapping up two days of talks that come to a close Friday with a report showing inflation in the euro area hit a new high.
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The srength of the euro is a topic of increasing concern to EU leaders and was a “serious issue” at the summit.
Yearly inflation in the 15 nations that share the euro hit a revised 3.3 percent last month, the EU statistical agency said Friday — setting a new record as prices for oil and food surged.
The dollar’s extended slump was central to the discussions.
Just as Slovenian Prime Minister Janez Jansa called the euro’s strength a a “serious issue,” the euro hit a new high against the U.S. dollar, peaking at $1.5652.
A more expensive euro makes German cars and French wines tougher to sell to the EU’s biggest trade partner, the U.S. A strong euro, however, could ease inflation by cutting the import bill for dollar-priced oil.
The dollar has declined on pessimism about the U.S. economy, which has fed expectations that the Federal Reserve will continue to lower interest rates to jump-start the economy.
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EU leaders insisted in a draft declaration that the fundamentals of the economy remain strong. But the main lever to curb soaring inflation and runaway exchange rates — interest rates — lies outside their hands, and in the control of the fiercely independent central banks.
EU leaders urged member nations to hold off measures such as fuel taxes that would take more money out of shoppers’ pockets as they shell out more for basics.
The leaders plan to issue a statement expressing concern about “fragile” financial markets with credit tight and banks reluctant to disclose losses from complex investments in U.S. mortgage-backed securities. Those securities began to unravel rapidly last summer.
Banks worldwide have written off more than $150 billion in the past half-year, including large fourth-quarter write-offs by major European banks like UBS and Credit Suisse.
Yet Standard & Poor’s Ratings Services said Thursday it estimates writedowns of subprime asset-backed securities could reach $285 billion globally, up from its previous projection of $265 billion.
The statement from the EU will urge banks to provide “prompt and full disclosure of exposures to distressed assets.”
Opponents of Chinese rule in Tibet set fire to vehicles and shops on Friday as tear gas filled the streets and gunfire rang out in the Tibetan capital, Lhasa, according to witnesses and human rights groups.
The protests — initiated by Buddhist monks — have been growing since Monday, the anniversary of the failed 1959 Tibetan uprising against Beijing rule. Tibet, an autonomous province, has long sought independence from China.
Roughly 1,000 people hurled rocks and concrete at security forces and military trucks pushing back riot police, a witness told CNN.
A Tibetan guide said armed police backed by armored vehicles were blocking major intersections in the city center and that an entire street in a busy shopping area outside the Jokhang temple “seemed to be on fire.” He said he had heard “cannon fire” and had heard reports of tear gas being used against protesters, The Associated Press reported.
In a statement, the Dalai Lama, Tibet’s spiritual leader and the head of the Tibetan government in exile, said he was “deeply concerned” by the developing situation and said the protests were “a manifestation of the deep-rooted resentment of the Tibetan people” under Chinese rule.
“I appeal to the Chinese leadership to stop using force and address the long-simmering resentment of the Tibetan people through dialogue. I also urge my fellow Tibetans not to resort to violence,” the Dalai Lama said.
Protesters appeared to be targeting shops and vehicles owned by Han Chinese, the predominant ethnic group in China.
A main market in the capital was set on fire, and some Tibetans were hospitalized with serious injuries, according to Kate Saunders, a spokeswoman for the International Campaign for Tibet, which promotes human rights and democratic freedom in Tibet.
Friday’s violence started when police tried to stop a peaceful protest by monks at the Ramoche Temple, Tashi Choephel of the Tibetan Center for Human Rights told CNN from Dharamsala, India.
“The monks from the Ramoche Temple on the north side of Lhasa, they started a peaceful demonstration and they were blocked by the People’s Armed Police,” Choephel said.
Speaking to The Associated Press, a witness said hundreds of monks and civilians were involved in the protests, setting police cars and army vehicles alight. A Lhasa resident said police had imposed a curfew, closing off all roads into the city center.
A photo e-mailed to CNN from a source in Lhasa showed what appeared to be Chinese military vehicles containing security forces armed with riot shields at the Ramoche Temple. Video Watch reports of rioting in Tibet »
Saunders said violence broke out as bystanders joined the protest. “Apparently local people — lay people — got involved, and a police car was set on fire. This was followed by Tromsikhang Market being set on fire,” she said from London.
The market has many Chinese traders. Saunders said Tibetans are concerned about the influx of Chinese into the area. Some ethnic Tibetan shopkeepers hung scarves outside their stores in an effort to spare them from the protesters’ wrath, a witness reported.
Queen Elizabeth helped launch Heathrow’s $8.6 billion new Terminal 5 on Friday as part of the British airport’s rejuvenation plan to maintain its status as one of the world’s most important transport hubs.
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A general view of the new Terminal 5 at Heathrow Airport prior to its official opening on Friday.
The British monarch, who also opened Heathrow’s first passenger terminal in 1955, was present under strict security a day after a man carrying a backpack was arrested for running onto a runway at the airport.
The launch of Terminal 5 has come after 15 years of planning and construction by its owners BAA — and protests by local residents and environmental groups.
It is part of a strategy which could lead to passenger numbers almost doubling to 122 million a year, with a sixth terminal and a third runway in the pipeline despite some vociferous opposition.
Spanish-owned BAA, which also runs Gatwick and Stansted in Britain, also plans to eventually demolish Terminals 1 and 2 and replace them in a project called Heathrow East. Video Watch Queen Elizabeth meet airport staff. »
Residents were once told by BAA that there would be no fifth terminal, but the company is planning to forge further ahead despite the concerns of environmental groups.
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