Asia's Financial Markets Sell Off as Central Banks Rush to Calm Fears
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Central Banks from US, Britain, Japan, EU are pumping more than $180 billion into world banking system in effort to ease credit crunch
Leading central banks have rushed to add more cash to the world's financial system in an effort to calm nervous international markets. As Ron Corben in Bangkok reports, most Asian stock markets fell again Thursday, as investors continued to react to turmoil on Wall Street, although the sell-off slowed late in the day.
Japanese businessmen walk in front of share prices board in Tokyo, 18 Sep 2008The central banks of the United States, Britain, Japan, the European Union and other nations are pumping more than $180 billion into the world's banking system. The money is intended to increase the cash available to lenders and borrowers and ease the credit crunch that has sent stock and bond markets reeling this week.The announcement Wednesday appeared to soothe some investors. In late Asia trading, some of the steep losses seen early in the day were erased. Hong Kong's Hang Seng index, which had fallen more than seven percent at midday, ended nearly unchanged. Still, most Asian markets lost ground. Japan's Nikkei average closed down more than two percent, at a three-year low, with a similar decline in share prices in South Korea and Australia. Investors fear more problems ahead in US financial industry
AIG offices in New York City, 16 Sep 2008Investors in Asia fear further problems in the U.S. financial industry despite the government's $85 billion loan to rescue insurance company AIG. Investors also are rattled by the collapse of the investment bank Lehman Brothers and reports that more U.S. banks may be in trouble.Arporn Chewakrengkai is the chief economist at Thailand's Government Pension Fund. She thinks many Asian banks could be owed money by troubled U.S. banks."I believe that several Asian banks will have an impact from the fall of those big banks [in the United States]. So I think the stock markets in the region are still going to deteriorate further," he said. The fall in global share markets has wiped off more than $19 trillion in value since a peak was reached in late October last year. Arporn says that means the region will see slower growth because there will be less money available for businesses to borrow to expand.What caused crisis?
The crisis was caused by the most severe U.S. housing recession since the 1930s, which led to a credit shortage as thousands of homeowners fell behind on their mortgage payments.Graham Catterwell is a business consultant and former banker in Bangkok. Like many market analysts around the world, he says part of the problem lies in loosely regulated financial markets and the U.S. budget and trade deficit. A recovery, he says, could be two years away. "Some people are panicking but there have been imbalances building up over quite a few years - building up without people noticing quite often and unwinding in ways people did not expect," he noted.Many economists expect to see further restructuring of the financial industry, with more companies looking to mergers and takeovers to remain solvent.
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Bush Cancels Trip to Focus on Economic Crisis
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US president to consult with economic advisers in Washington on how best to handle financial market turmoil
President George W. Bush at the White House, 17 Sep 2008U.S. President George Bush canceled a trip Thursday to focus on the country's economic crisis.The White House says Mr. Bush will be consulting with his economic advisers in Washington on how best to handle the turmoil in the U.S. financial markets.Spokesman Tony Fratto says the president will be working on taking action to stabilize the markets and restore investor confidence.The president had planned to visit the southern states of Florida and Alabama, but the White House called off the trip late Wednesday.
Some information for this report was provided by AP and Reuters.
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Pakistani FM says US Gave No Warning of Suspected Missile Strike
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Foreign Minister Shah Mehmood Qureshi says rules of engagement were not respected
Pakistan's foreign minister says officials were not warned about a suspected U.S. missile strike that occurred hours after the top U.S. commander said the United States would respect Pakistan's sovereignty. VOA's Barry Newhouse reports from Islamabad.Pakistani FM Shah Mahmood Qureshi speaks during an interview (File photo)Foreign Minister Shah Mehmood Qureshi told reporters in Islamabad that Admiral Mike Mullen had given a clear commitment to Pakistan's sovereignty in meeting with Pakistan officials. Hours after the meetings, locals in Pakistan's South Waziristan tribal region reported missiles fired from a suspected U.S. drone aircraft killed at least five people. Local media reports said the target was a suspected militant camp and some of the dead were foreigners.Qureshi said the government had not been informed about a missile strike beforehand."Now if there was an attack later in the night, that means there is some sort of an institutional disconnect on their side and if so, they will have to sort it out," he said.Pakistani officials have protested what they say have been violations of the secretive terms of engagement for U.S. strikes on Pakistani territory. In particular, officials have denounced a raid by U.S. commandoes earlier this month. The military said it would protect Pakistan's sovereignty at all costs.But in recent days political leaders have toned down their criticisms and Foreign Minister Qureshi said the government is committed to remaining engaged with the United States in fighting terrorism. "There are people who genuinely fear that these organizations - al Qaida and elements of Taliban - are threatening them in mainland U.S. and other European places," Qureshi noted. "Now we as friends and allies have to understand their concern and address their concern. At the same time they have to understand that our strategy is not just purely military."Qureshi said Pakistan's President Asif Zardari and other top officials are expected to visit the United States next week for meetings with U.S. officials, including President George W. Bush.
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Yemen Arrests 25 Suspected al-Qaida Militants in Connection with US Embassy Attack
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Officials say militants used car bombs, grenades, automatic weapons in attack
Yemeni soldiers stand guard outside US embassy in Sanaa, 18 Sep 2008Authorities in Yemen have arrested at least 25 people with suspected links to al-Qaida in connection with Wednesday's attack on the U.S. embassy in the Yemeni capital, Sanaa.The assault killed six Yemeni security personnel and four bystanders, including an 18-year-old American woman and the Yemeni man she recently married. Six attackers also were killed.Officials say the militants used car bombs, grenades and automatic weapons in the attack. Yemeni guards and police fired back, preventing the attackers from breaching the embassy's security walls.The Yemeni government has vowed to find anyone else involved in the plot and bring them to justice.The U.S. government is recommending that Americans put off non-essential travel to Yemen, and warns those already in the country should make contingency plans.U.S. President George Bush said the attack is a reminder that the United States is at war with ideological extremists.The United Nations Security Council and U.N. Secretary-General Ban Ki-moon also condemned the embassy assault and called for the perpetrators to be brought to justice.U.S. State Department spokesman Sean McCormack said the assault bears the hallmarks of al-Qaida, but the U.S. has not concluded who is to blame. A group calling itself Islamic Jihad in Yemen claimed responsibility and threatened further strikes.Islamist militants have attacked the U.S. embassy in Sanaa several times since 2003. The most recent was in March, when mortars targeting the compound landed on a nearby girls' school, killing a Yemeni guard and wounding dozens of students.The U.S. State Department authorized non-essential staff to leave Yemen in April. It repeated that authorization Thursday.
Some information for this report was provided by AFP and Reuters.
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Death Toll Rises in China's Contaminated Milk Scandal
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Authorities say four people have died after drinking contaminated infant milk formula
In this photo released by China's Xinhua News Agency, a nurse takes care of sickened child at Hebei People's Hospital in Shijiazhuang, 16 Sep 2008Chinese authorities say four infants have now died after drinking contaminated milk powder that has sickened more than 6,000 babies across the country.Chinese officials announced the latest fatality Thursday, saying it occurred in the remote western region of Xinjiang. China's health minister says 158 of the country's sick infants are suffering from acute kidney failure. The milk was found to contain the chemical melamine. It is believed the manufacturer used the chemical to give watered-down milk the appearance of having high protein levels. In the wake of the scandal, China has canceled inspection exemptions given to companies with proven quality records.Meanwhile, 12 people have been arrested in Hebei province, bringing the total number of arrests to 18.Hebei is home to the Sanlu Group, the company that produced the tainted formula. The group's chairwoman, Tian Wenhua, has been dismissed from her post and is being detained by authorities. The mayor of Shijiazhuang city, where Sanlu is based, has also been fired, along with four other officials.Six of those arrested allegedly sold the chemical, while the other 12 were suppliers accused of contaminating the milk.Separately in Hong Kong today, authorities have ordered the recall of dairy products made by China-based Yili Foods after eight out of 30 of its products tested positive for melamine, including milk, yogurt and ice cream. China's Health Ministry has pledged free health care to all children sickened by the tainted milk. The government also has stationed 1400 inspection teams at dairy-producing enterprises across the country. It has also pledged to increase inspection of all dairy products, as well as imported and exported feed, for the presence of melamine.
Some information for this report was provided by AFP, AP and Reuters.
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Livni Wins Israeli Election by Narrow Margin
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Analysts say Tzipi Livni will have to strike balance between improving relations with Arabs and keeping right-wingers at home happy
Israel's Foreign Minister, Tzipi Livni, has won a narrow victory in the ruling centrist Kadima party's primary election, putting her on track to become Israel's first female Prime Minister in more than three decades. Ms. Livni will replace Ehud Olmert, who is stepping down as he faces corruption investigations. VOA's Jerusalem correspondent Luis Ramirez reports. Israeli Foreign Minister Tzipi Livni speaks to media after winning elections in Tel Aviv, 18 Sep 2008Livni's election is raising hopes among some here who believe her willingness to pursue peace negotiations is the last hope for an agreement with the Palestinians. The former intelligence operative, lawyer, and mother of two sons, is Israel's top negotiator in the current round of U.S. brokered peace talks. As a moderate, she won support from those in the party who want a negotiated settlement. At the same time, she won favor among some on the right for saying she will not hesitate to use military action if necessary. Talks have been stuck on old issues including the status of Jerusalem, the Palestinians' claim to a right of return to lands seized by Israel, and Jewish settlements. Analysts say Israel's ability to negotiate has been undermined by the turmoil in its internal politics.In her acceptance remarks Thursday, Livni indicated she will waste no time putting a new government in place. Livni says the mission now is to create stability in the government to confront security threats, to take advantage of opportunities for peace and to deal with economic instability.The centrist Kadima Party must work to regain the trust of Israeli voters at large. Confidence has been damaged by the corruption allegations against Mr. Olmert, lack of progress in the peace talks, and other issues. Some Palestinians welcomed Livni's election on Thursday. Mahdi Abdul Hadi, head of the Palestinian Academic Society for the Study of International Affairs, a research organization in Jerusalem, tells VOA Livni's experience in dealing with Arabs is viewed by some Palestinians as a sign of hope for the peace process. "She has been very much acquainted with the details of the whole issue and she comes across that a new chapter in the vision of leaders among Israelis," he said. "She has been received warmly in the Gulf and she has been recognized as a new face, a new leader, a new image for Israel in the region. How fast she can contain and maintain that presence and contact, and build up on it, has yet to be seen." Analysts say galvanizing support among Israelis will not be easy for Livni, who has to strike a balance between improving relations with Arabs and keeping right-wingers at home happy. Late Wednesday, exit polls had shown her winning by a large margin. Official results on Thursday narrowed that victory to a few hundred votes, something analysts say indicates her party will likely face a strong challenge if it has to face the increasingly popular, right-wing Likud party led by former Prime Minister Benjamin Netanyahu in the coming months. Livni has only a few weeks to put together a governing coalition or the country will be forced to hold early general elections.
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Obama Leads McCain in New US Opinion Polls
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Democratic, Republican presidential nominees now focusing campaigns on worsening US financial crisis
Sen. Barack Obama speaks during a rally in Elko, Nevada,17 Sept 2008New opinion surveys show U.S. Democratic presidential nominee Barack Obama has regained the lead over Republican challenger John McCain.A new poll conducted jointly by the New York Times and CBS News shows Obama with a five point lead over McCain (48 percent to 43 percent) among registered voters. The Illinois senator is leading among independents and young adults, while the 72-year-old McCain leads among white men and voters over the age of 65. Support for both men are split between middle-aged (45 to 64 years old) and white women voters. But the poll found 71 percent believe McCain is prepared to serve as president, compared to 48 percent for Obama.Meanwhile, the latest Gallup poll - September 14-16 - shows Obama with a two percent lead over McCain. Obama and McCain are focusing their campaigns on voters' concerns about the worsening U.S. financial crisis.Sen. John McCain smiles to an enthusiastic crowd during a rally at the Tampa Convention Center in Tampa, Florida, 16 Sept. 2008McCain issued a statement Wednesday saying poor regulation and reckless management crippled AIG. He called for an investigation into whether executives in the company misled investors.McCain originally spoke out against an AIG bailout, but on Wednesday, he said such action should be used to protect millions of Americans who hold insurance policies.In a campaign appearance in Nevada Wednesday, Obama said this week's economic developments represent the final verdict on McCain's policies.McCain will hold rallies Thursday in Iowa and Wisconsin with his running mate, Alaska Governor Sarah Palin. Obama will hold a rally of his own in New Mexico.In a separate development, Senator Hillary Clinton, Obama's former rival for the Democratic nomination, canceled an appearance at a rally next week protesting Iranian President Mahmoud Ahmadinejad, after learning Palin had also been invited. A spokeswoman for Palin responded by saying the governor believes the threat of a nuclear Iran is more important than party or politics.Also Wednesday, a top Hillary Clinton fundraiser and member of the Democratic National Committee, Lynn Forester de Rothschild, threw her support behind Republican John McCain.
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North Korea Missile Site Said to Be Capable of Advanced Engine Testing
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Analyst says reports of missile engine testing at newly revealed facility appear credible
One of the world's foremost analysts of North Korea's ballistic missile
programs says reports of missile engine testing at a newly revealed
facility appear credible. As VOA Seoul Correspondent Kurt Achin
reports, North Korea is apparently able to test its missiles under more
realistic conditions than ever.South Korean media have
been reporting this week, indications North Korea may have tested
engines for some of its largest and longest-range missiles earlier this
year.Joseph Bermudez is a senior analyst with the Jane's group
of defense and intelligence publications. He says the test would be
consistent with North Korea's decades-old missile development program."North
Korea has routinely conducted ballistic missile engine, space launch
vehicle engine, testing for the past 10-15 years. It would not be
unusual that they would do that now," he said.The tests are
suspected to have taken place at a facility Bermudez took the lead in
making public this week. A report published by Jane's Defence Weekly
features satellite photographs of a 10-story missile tower and launch
pad, located in a Southwestern region of North Korea. Bermudez says
North Korea probably began building it about eight years ago."The
North Korean missile and space launch facility near Pongdong-ni is the
most advanced North Korean launch facility to date," he said. Bermudez
says North Korea has usually tested missile engines by separating them
from the body of the missile that would carry it. He says the new
facility may make future tests more realistic."This facility
appears that it could actually test the engine while it's in the
airframe. What this does, it gives you an additional capability to
test how your subsystems will react to the vibrations and possibly heat
of the engine," explained Bermudez. North Korea has devoted
abundant resources and attention to missile development since the
1970s. It is believed to have about 800 missiles, most of them
short-range weapons capable of reaching Japan and South Korea. In
2006, Pyongyang tested a long-range missile theoretically capable of
reaching the United States, but it failed less than a minute after
launch. That long-range test took place just a few months
before North Korea conducted a test explosion of its first nuclear
weapon. Bermudez says the nuclear and missile programs are designed to
complement each other."North Korea wants nuclear weapons, and it wants to mount those... on its ballistic missiles," he said.Some
security experts believe North Korea may be able to reach the United
States with a ballistic missile by about 2012, under the most favorable
set of conditions. Mounting a nuclear weapon on a long-range missile
and delivering it accurately is a far more complex task. Whether
Pyongyang might achieve that remains a matter of speculation.
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Malaysia's Anwar Calls for Emergency Parliamentary Session
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Session would hold no confidence vote against Prime Minister Abdullah Ahmad Badawi
Malaysian opposition leader Anwar Ibrahim has called for a special session of parliament to hold a vote of no confidence against the government of Prime Minister Abdullah Ahmad Badawi. VOA's Nancy-Amelia Collins in Jakarta has more.Malaysian opposition leader Anwar Ibrahim talks to media during press conference in Kuala Lumpur, 18 Sep 2008 Opposition leader Anwar Ibrahim told a news conference Thursday he has sent a letter to Prime Minister Abdullah Ahmad Badawi asking that an emergency session of parliament be held no later than September 23.Parliament is currently in recess until October 18.Anwar says he expects an immediate answer from Mr. Abdullah and any delay "would be interpreted as nothing short of sabotage."Anwar says he has secured enough defectors from the ruling coalition to topple the government."We have received firm commitment from members of parliament in excess of the number required to form a new government. And our government will reflect the diverse make-up of Malaysia society," he said.Mr. Abdullah has refused to meet with Anwar and denies the opposition leader has convinced enough lawmakers to switch sides.Anwar has set the date for the emergency parliament session one day before he is due in court to answer charges he sodomized his male aide, a crime in Malaysia punishable by up to 20 years in jail.Anwar denies the sodomy charge and says it is politically motivated to keep him from bringing down the government.Anwar has promised if he takes power to implement economic reforms, end corruption, and promote racial equality between the country's majority Malays and the minority ethnic Indian and Chinese Malaysians."We believe we can save Malaysia from economic ruin and the dangerous politics of racism. We can do so prudently, legally, and in doing so we will not jeopardize the security and stability of the country and the safety of its people," he said.Mr. Abdullah's government has been facing mounting pressure since the March general elections saw the ruling Barisan Nacional coalition loose its two-thirds majority in parliament, the first time it lost its majority since independence more than 50 years ago.Mr. Abdullah is also facing dissent from his own party members who want him to hand over power to his deputy, Najib Razak, before the 2010 deadline he had set forhimself.On Wednesday Mr. Abdullah said he may step down before the 2010 deadline and handed the finance ministry to his deputy, Najib, setting in motion the eventual transfer of power.
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Bush Praises Muslim Americans
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US president hosts White House dinner breaking fast of Muslim holy month of Ramadan
U.S. President George Bush hosted a White House dinner breaking the fast of the Muslim holy month of Ramadan. VOA White House Correspondent Scott Stearns has the story.President Bush speaks during Iftaar Dinner at White House, 17 Sep 08 This was the president's eighth Iftaar dinner in eight years at the White House. Mr. Bush gave thanks for the many ways that Muslim Americans enrich the lives of all Americans."One of the great strengths of our nation is its religious diversity. Americans practice many different faiths. We all share a belief in the right to worship freely. We reject bigotry in all its forms. And over the past eight years, my administration has been proud to work closely with Muslim Americans to promote justice and tolerance of all faiths," he said.The president singled out some of those attending the Iftaar dinner, including those who have worked on America's space program as well as those who have made advances in health care and technology."Muslim thinkers and scientists have advanced the frontiers of human knowledge. People of all faiths have benefited from the achievements of Muslims in fields from philosophy and poetry to mathematics and medicine. At the beginning of a new century, Muslims in the United States are continuing this proud tradition of innovation and inventio," he said.The president said the United States has partnered with Muslims around the world to spread freedom. "We are helping the people of Iraq and Afghanistan build free societies after decades of tyranny. And during the month of reflection, we will remember all the brave Muslim Americans who wear the uniform of the United States armed forces. They represent the best of our nation. I am honored to be their Commander-in-Chief," he said.The president was joined in the State Dining Room by guests who included Kuwaiti Prime Minister Sheikh Nassar Muhammad al-Ahmad al-Sabah. The Kuwaiti News Agency reports the prime minister is in Washington for a range of talks including the future of four Kuwaitis held as suspected terrorists at the U.S. military detention center at Guantanamo Bay.U.S. Army Military Chaplin Abdullah Hulwe offered the evening's prayer, asking God to grant those present the strength to meet all dangers with courage and wisdom and all occasions with discipline and loyalty."Help us to use our fasting as an instrument for the betterment of all humanity and peace throughout the world. We thank you for the strength of character that Ramadan gives us. Help us to use it to defend and preserve liberty with all righteousness with peace as the supreme desire of our hearts," he said.More than one billion Muslims around the world celebrate the holy month of Ramadan with fasting, prayer, and acts of charity. They believe the holiday marks the revelation of God's word in the Holy Koran to the prophet Mohammad.
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