Politics and Economics Headlines - 4 November, 2005
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Indonesia's inflation soars after fuel price hike
Agency France Presse via Yahoo
JAKARTA () - Indonesia's inflation rate soared in October after a recent steep rise in fuel prices, prompting the central bank to hike interest rates sharply and warn that growth would likely slow in Southeast Asia's largest economy. Bank Indonesia said it had raised its key BI rate by 125 basis points to 12.25 percent in light of a higher-than-expected inflation rate in October. It hiked the rate 100 points early last month.
The hike came after the Central Bureau of Statistics said that the country's consumer price index (CPI) rose 8.7 percent in October from September and was up 17.9 percent year-on-year. Inflation in the 10 months to October was 15.7 percent. The increases were far above market and central bank expectations, with Bank Indonesia forecasting a month-on-month rise of 5 percent and a year-end forecast of just 14 percent.
The government raised fuel prices on October 1 by an average of 126 percent to relieve some of the pressure caused by crippling state fuel subsidies, after global oil prices struck historic highs. Central Bureau of Statistics head Choiril Maksum told a news briefing that all CPI components jumped in October, with transportation and communication prices soaring 28.6 percent month-on-month. ...
(1 November 2005)
Emphasis added. See also Bloomberg.-LJ
Bulgaria faces energy pinch
Sofia News Agency
The next two years will be tough on Bulgaria when it comes to electricity.
That has emerged from a statement of Emergy Minister Rumen Ovcharov, who admitted that energy imports might be necessary. At present, Bulgaria is an exporter but the nearing EU-enjoined closure of two nuclear units will drastically decrease the energy produce.
Ovcharov was not too optimistic about the construction of the second Bulgarian nuclear power plant either. Bulgaria's experience in building new power plants and getting them started has faded, the minister pointed out. In his words, the Belene plant would not start functioning until 2010.
The country has seen passionate debates on whether the EU demand to shut Kozloduy's units 3 and 4 should be met. Experts have argued that the reactors could continue to work safely for years after the EU-set deadline, 2006.
The cost of Bulgaria-produced electricity is expected to jump by almost 60% after the shutdown.
(2 November 2005)
Nigeria must end army killings in oil delta-Amnesty
Estelle Shirbon, Reuters via Alertnet
ABUJA - Nigerian security forces protecting oil industry interests in the southern Niger Delta kill local people and raze villages with impunity, human rights group Amnesty International said in a report published on Thursday.
Amnesty accused the government of ignoring the army's abuses and failing to tackle the poverty and injustice it said were the root causes of frequent unrest in the delta.
Nigeria is the world's eighth oil exporter and the bulk of its 2.4 million barrels per day output comes from the delta.
(3 November 2005)
Energy prices push up IT salary adjustments
Timothy Prickett Morgan, IT Jungle
... the rising costs of energy, based mostly on the strong upswing in oil prices, is having a ripple effect on all economies, which are largely based on the nearly free energy we obtain from the use of oil. I know oil doesn't feel free, particularly when we are paying $3 to $4 a gallon at the gas pumps, but the reality is that it is relatively inexpensive compared to what it will eventually be and, equally importantly, compared to alternative energy sources that we would have had to use in the past 100 years had oil not been created in such bounty by Mother Earth. I am no economist, but it seems fairly obvious from my copious reading on the subject of energy in recent months that we have hit or will soon hit global peak oil production. With China consuming massive amounts of resources, including oil, as its economy explodes with growth, we have too many people chasing a static amount of oil supply. Gulf War II and hurricanes Rita and Katrina may have only accelerated a problem that was going to sock us anyway: the unavoidable rising costs of energy. So much of what we eat, make, sell, and distribute is based either directly or indirectly on oil, that the effect of energy prices on the global economy is magnified. But an economy is a resilient thing, and we will learn to absorb that cost. We really don't have a choice, other than economic collapse.
That may seem like a sidetrack when discussing IT salaries in general and salaries at iSeries shops in particular, but energy price increases are a big factor in the cost of living raises many IT staff get as well as the costs of doing business at the companies where you work. It puts something of a squeeze on your employer, to put it bluntly. You need more money to live, and you deserve it, but the company will have to pass the rising costs of energy on to your customers just to keep your pay the same. If your company raises prices a little bit more to cover the cost of employee raises, then you actually take part in the creation of the next wave of inflation
(31 October 2005)
US: Car sales hit brakes after storms, discounts
Dee-Ann Durbin, Miami Herald
Sales of sport-utility vehicles declined by 50 percent or more, as overall auto sales fell sharply in October.
U.S. auto sales fell sharply in October, dampened by hurricanes, fidgety consumers and high gas prices. Automakers warned they don't expect an upswing in November.
General Motors, Ford and Nissan reported big declines Tuesday, while Toyota's U.S. sales edged up slightly, Honda's sales rose and DaimlerChrysler's sales were flat. Sport-utility vehicles took the biggest hit across all makers. Sales of the Ford Explorer, Lincoln Navigator, GMC Yukon, Hummer H2 and Toyota Land Cruiser were all down 50 percent or more.
General Motors, the world's biggest automaker, said U.S. sales fell 22.7 percent in October from a year ago, led by a 30.3 percent decline in sales of trucks and SUVs.
(2 November 2005)
Oil execs to be asked to justify profits
H. Josef Hebert, Associated Press via Yahoo!News
WASHINGTON - Top executives of three major oil companies will be asked by senators next week why some of their industry's estimated $96 billion in record profits this year shouldn't be used to help people having trouble paying their energy bills.
Lee Raymond, chairman of Exxon Mobil Corp., Jim Mulva, chief executive of ConocoPhillips, and John Hofmeister, president of the U.S. unit of Royal Dutch Shell PLC, will be among the industry executives to be questioned at a Senate hearing, according to congressional and industry officials.
The officials spoke on condition of anonymity because a final list of witnesses yet to be completed. The three companies together earned more than $22 billion during the July-September quarter this year when crude oil prices soared briefly to $70 a barrel and motorists were paying well over $3 gallon at the pump after Hurricanes Katrina and Rita struck the Gulf Coast.
(2 November 2005)
Passamaquoddy groups sue officials over LNG project
Associated Press via Maine newspapers
BANGOR — Two groups from the Passamaquoddy Tribe on Wednesday sued officials of the federal Bureau of Indian Affairs, saying the BIA failed to represent their views in its review of a proposed liquefied natural gas terminal in eastern Maine. A lawsuit was filed in U.S. District Court by a group called We Protect Our Homeland, an affiliate of Save Passamaquoddy Bay Three-Nation Alliance, and six members of the Pleasant Point Passamaquoddy community.
(3 November 2005)