Seoul bails out collapsing banks
The Bank of Korea announced September 8 it would pour $2.2 billion into the sinking Korea First Bank and other banks in an effort to prevent a major currency crisis. Korea First got a $1.1 billion, one-year loan at below-market interest rates. This is the fourth bailout in the history of the central bank. Park Ung-suh, president of the Samsung Economic Research Institute said, "Government support for the bank is absolutely necessary to avoid financial panic." The banking crisis has been fueled by the bankruptcy or collapse of five major industrial conglomerates this year, which resulted in bank-issued rescue plans of billions of dollars.
Volvo halts Thai auto plant
The Swedish auto company Volvo AB has halted production at its assembly plant in Thailand for at least 10 weeks, citing instability from the devaluation of the Thai baht and other currencies in the region. About 120 workers will be laid off. Meanwhile, the Japanese automakers Toyota Motor Corp., Isuzu Motor Ltd., and Honda Motor Co. have all announced price increases on their vehicles sold in Thailand of between 3 and 5 percent, also citing the baht's plunge. A spokesman for Toyota speculated that the overall Thai market for vehicles would shrink by at least 15 percent in 1997.
Amoco deal for Russia oil falters
The U.S. oil giant Amoco invested $100 million over four years in an oil deal with the Russian company Yukos. But on September 10 Alexander Golubovich, deputy chairman of Yukos, told investors that his company had "no relationship" with Amoco. Yukos, one of Russia's largest oil companies, had entered non-government-approved negotiations with Amoco to develop the 4 billion barrel Priobskoye field in Siberia. Amoco says it is entitled to at least half the oil, and threatened to take unspecified action against Yukos. This is the second major U.S.-Russian oil venture to go sour in recent months. In August, the Russian government nixed an agreement won by Exxon Corp. to develop oil fields in the Russian Far North.
Hungary delays NATO vote
Hungarian prime minister Gyula Horn announced September 8 that two national referenda scheduled for November 16 would be pushed back a few weeks. The first vote will be to decide if Hungary should join NATO. The second referendum is on whether Hungarian companies will be able to own arable land, and whether foreign entities should have that right. At present only Hungarian individuals and cooperatives can own tillable land. Companies inside the country and foreign entities only have access through renting.
Germany: joblessness rises again
Working people in Germany faced 11.4 percent unemployment in August, with the number of jobless rising by 49,000 from the previous month and reaching a post-World War II record. In eastern Germany unemployment hit 18.3 percent, compared with 15 percent a year ago. West German unemployment rose to 9.7 percent.
At the same time, wages grew by a mere 1 percent in the second quarter, slower than any year on record, said Credit Suisse in London. Germany's gross domestic product actually grew at a rate of 2.9 percent in the second quarter, but Bundesbank council member Hans-Juergen Krupp warned that it would be "foolish" to characterize the Germany economy as recovered.
U.S. gov't threatens CARICOM
Representatives from the various Caribbean countries were invited to a breakfast meeting in Washington D.C. to discuss hemispheric trade and economic issues, "but when we got there the main purpose was to threaten us with sanctions if Cuba became a member of CARICOM [Caribbean Community]," the August 19 Carib News quoted an unnamed Barbados official as saying. U.S. Rep. Ileana Ros-Lehtinen "simply walked in and launched into anti-Cuban speech."
Ros-Lehtinen and other legislators have introduced a bill stating that any government that uses its voice or vote to support Cuba's membership into CARICOM or the Central American Common Market, or even "enters into negotiation .. towards a free trade area agreement" with the Havana, "would lose duty free access of its products to the U.S. market." Ros-Lehtinen took it a step further by dropping each CARICOM member a letter saying that repercussions for such dealings would be felt "individually and as a unit; politically and economically; in the hemisphere and globally; in the court of public opinion and in real terms."
House backs anti-immigrant bill
On September 5 the U.S. House of Representatives voted 261-150 in favor of a measure to include the deployment 10,000 troops along the U.S. border with Mexico in the 1998 defense bill. The measure, introduced by Democratic Congressman James Traficant, is supposedly aimed at fighting drug trafficking and illegal immigration. California Republican representative Brian Bilbray also backed the measure as a way to guard against "drugs and the violent activity that is going on along the border."
The $650 million project is opposed by the U.S. Defense Department and the Justice Department, who argue for hiring more border cops instead. The Immigration and Naturalization Service already plans to beef up the nearly 7,000-strong Border Patrol by 5,000 over the next five years. Meanwhile, the Clinton administration has proposed doubling citizenship application fees from $95 to $200 or more.
Sheriff: prison tents for juveniles
Maricopa County sheriff Joe Arpaio, who has earned a reputation for brutal conditions in his county jail in Arizona, now plans to imprison juveniles in outdoor army tents and put them on chain gangs. The tents can reach up to 122 degrees. Inmates there are fed green bologna and denied warm lunches, soft drinks, cigarettes, and movies. Prisoners are issued pink underwear and are paraded through the town in striped uniforms on chain gangs. Lt. Nick Larkin, a supervisor at the jail told reporters, "We don't correct anybody, we don't train, we don't teach, we don't rehabilitate, We just lock your a - up." There have been three inmate deaths reported as suicides at that prison in 1997.
`Ban all mines but ours'
U.S. officials at an international conference in Oslo, Norway, negotiating a ban on antipersonnel land mines argued that Washington should be partially exempted. Delegates from more than 100 countries are participating in the talks. The U.S. government proposed that it continue to deploy land mines on the Korean peninsula. Some 37,000 U.S. troops are based in south Korea, enforcing the division of north and south Korea. Washington also wants an exemption for its antitank weapons, which have anti-personnel devices. According to the Financial Times, Clinton administration officials say they are committed to a ban that recognizes U.S. "global security responsibilities."
- BRIAN TAYLOR
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