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EU, China, US unleash global assault on crisis
2 days ago
BRUSSELS (AFP) — The EU was to call on members to spend their way out of recession on Wednesday as China cut its interest rates and the United States injected another 800 billion dollars into the economy.
The new global assault came as new evidence of the social effects of the financial crisis and economic slowdown emerged, with officials in China reporting riots by unemployed workers.
In Brussels, the European Commission was to urge countries to launch a "significant" two-year tax and spending campaign to jolt their embattled economies, according to draft proposals obtained by AFP.
"Only through a significant stimulus package can Europe counter the expected downward trend in demand, with its negative knock-on effects on investments and employment," said the draft document.
Countries across the world have launched tax and spending programmes designed to encourage spending and business activity, with a coordinated EU-wide plan seen as more effective than individual country efforts.
The European draft did not say how much the stimulus package could be worth, but commission chief Jose Manuel Barroso has said it should be at least one percent of EU output, which would amount to about 130 billion euros (170 billion dollars).
China launched a 586-billion-dollar economic stimulus package in early November and the country's central bank announced another cut in interest rates on Wednesday to spur growth in the emerging giant.
The emerging Asian giant is seen expanding at a slightly slower 8-9 percent rate this year.
China's central bank slashed its benchmark one-year rate by 1.08 percentage points on Wednesday.
Also in China, hundreds of workers sacked from a toy factory in China clashed with police and smashed buildings, authorities said, in the latest bout of violent unrest linked to rising unemployment.
The riot occurred Tuesday in Guangdong province, southern China's export heartland where similar protests have flared recently, after about 2,000 workers gathered to demand severance pay, according to the local government.
In other changes linked to the global slowdown, the number of jobseekers applying to the civil service in Hong Kong has soared amid widespread redundancies by private sector firms hit by the global crisis.
The Civil Service Bureau said it had received more than 24,000 applications for just 400 assistant clerical officer vacancies.
In Washington Tuesday, the Federal Reserve said it would pump a massive 800 billion dollars more into the economy to try to stabilise the staggering US financial system.
Up to 600 billion dollars will go towards purchases of mortgage securities, and a separate 200 billion dollars for asset-backed securities to help get credit to consumers.
The new efforts aim to thaw credit markets, promote liquidity and bring down borrowing costs for the housing market, which is at the center of the economic storm that has dragged down the global economy.
Elsewhere, in Argentina, President Cristina Kirchner proposed tax and investment incentives to help cushion the impact of the global financial crisis on the nation and encourage repatriation of capital.
She also unveiled a massive public spending plan to pump more than 21 billion dollars into Argentina's infrastructure.
On global stock markets, Asian shares closed mixed, while European markets were under pressure after two days of large gains.
Tokyo's Nikkei-225 index ended 1.3 percent lower, weighed down by concerns about a stronger yen, and Sydney slipped 2.3 percent. But Seoul closed up 4.7 percent and Hong Kong's Hang Seng was 3.4 percent higher by lunch.
In Europe, French shares fell by 1.42 percent to 3,162.74 points on the CAC 40 index in early trading, London was down 0.75 percent while Frankfurt was off 0.70 percent.
In gloomy news Tuesday, a report by the Organization for Economic Co-operation and Development said many rich countries faced their worst economic crisis since the 1980s.
The OECD said eight million more people could be thrown out of work by 2010 in the 30-country zone of industrialised nations.
2 days ago
BRUSSELS (AFP) — The EU was to call on members to spend their way out of recession on Wednesday as China cut its interest rates and the United States injected another 800 billion dollars into the economy.
The new global assault came as new evidence of the social effects of the financial crisis and economic slowdown emerged, with officials in China reporting riots by unemployed workers.
In Brussels, the European Commission was to urge countries to launch a "significant" two-year tax and spending campaign to jolt their embattled economies, according to draft proposals obtained by AFP.
"Only through a significant stimulus package can Europe counter the expected downward trend in demand, with its negative knock-on effects on investments and employment," said the draft document.
Countries across the world have launched tax and spending programmes designed to encourage spending and business activity, with a coordinated EU-wide plan seen as more effective than individual country efforts.
The European draft did not say how much the stimulus package could be worth, but commission chief Jose Manuel Barroso has said it should be at least one percent of EU output, which would amount to about 130 billion euros (170 billion dollars).
China launched a 586-billion-dollar economic stimulus package in early November and the country's central bank announced another cut in interest rates on Wednesday to spur growth in the emerging giant.
The emerging Asian giant is seen expanding at a slightly slower 8-9 percent rate this year.
China's central bank slashed its benchmark one-year rate by 1.08 percentage points on Wednesday.
Also in China, hundreds of workers sacked from a toy factory in China clashed with police and smashed buildings, authorities said, in the latest bout of violent unrest linked to rising unemployment.
The riot occurred Tuesday in Guangdong province, southern China's export heartland where similar protests have flared recently, after about 2,000 workers gathered to demand severance pay, according to the local government.
In other changes linked to the global slowdown, the number of jobseekers applying to the civil service in Hong Kong has soared amid widespread redundancies by private sector firms hit by the global crisis.
The Civil Service Bureau said it had received more than 24,000 applications for just 400 assistant clerical officer vacancies.
In Washington Tuesday, the Federal Reserve said it would pump a massive 800 billion dollars more into the economy to try to stabilise the staggering US financial system.
Up to 600 billion dollars will go towards purchases of mortgage securities, and a separate 200 billion dollars for asset-backed securities to help get credit to consumers.
The new efforts aim to thaw credit markets, promote liquidity and bring down borrowing costs for the housing market, which is at the center of the economic storm that has dragged down the global economy.
Elsewhere, in Argentina, President Cristina Kirchner proposed tax and investment incentives to help cushion the impact of the global financial crisis on the nation and encourage repatriation of capital.
She also unveiled a massive public spending plan to pump more than 21 billion dollars into Argentina's infrastructure.
On global stock markets, Asian shares closed mixed, while European markets were under pressure after two days of large gains.
Tokyo's Nikkei-225 index ended 1.3 percent lower, weighed down by concerns about a stronger yen, and Sydney slipped 2.3 percent. But Seoul closed up 4.7 percent and Hong Kong's Hang Seng was 3.4 percent higher by lunch.
In Europe, French shares fell by 1.42 percent to 3,162.74 points on the CAC 40 index in early trading, London was down 0.75 percent while Frankfurt was off 0.70 percent.
In gloomy news Tuesday, a report by the Organization for Economic Co-operation and Development said many rich countries faced their worst economic crisis since the 1980s.
The OECD said eight million more people could be thrown out of work by 2010 in the 30-country zone of industrialised nations.
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