China, US pledge $30b to boost world economy

China and the United States have pledged $30 billion to help finance global trade as part of efforts to boost the faltering world economy.

The money will be made available to importers, including those in developing countries, who have found it difficult to get credit to buy goods.

"To support trade flows during this period of financial turmoil the US and China announced today that our two export-import banks will make available an additional 20 billion dollars for trade finance, particularly for creditworthy importers in developing economies," US Treasury chief Henry Paulson said.

He made the remark at the end of the two-day Strategic Economic Dialogue, a high-level Sino-US meeting in Beijing, held against the backdrop of the worst global financial crisis in decades.

One of the main themes in the two days of talks at the Diaoyutai State Guest House in western Beijing has been about ways to open up global trade flows in order to boost the economy.

"Both sides believe that in the face of the growing challenges posed by the ... crisis, we must fully oppose all forms of protectionism," Vice Premier Wang Qishan, the head of the Chinese team, said.

"We stand ready to work actively with other countries in the world to promote the early resumption of the WTO Doha round of negotiations so as to... promote prosperity and growth of the world economy and trade."

What is a Business Plan?

The primary value of your business plan will be to create a written outline that evaluates all aspects of the economic viability of your business venture including a description and analysis of your business prospects.

Since the My Own Business, Inc. course is broken down into 14 of the most important topics to consider in starting or operating a business, your business plan can easily be organized into this same format. Included in this session, and in each of the following sessions, there is one-page business plan template, which you can fill in and print. (Session 2 contains templates for both Sessions 1 and 2.) When you put these all together, you will have completed your personalized, overall plan.

Singapore Cuts GDP Forecast as Global Crisis Deepens

Singapore’s economy may shrink more than previously forecast in 2009, the government said, citing the worsening global recession and foreshadowing a deepening slump throughout the region.

“The global economic crisis has worsened since November, with sharp declines in global demand, trade and investments,” the trade ministry said in a statement today. The economy may contract as much as 2 percent this year, twice as much as a Nov. 21 prediction, it said.

Singapore is speeding up its response to the global slowdown and will unveil more steps to help companies and minimize job cuts when it brings forward its 2009 budget announcement to this month, Prime Minister Lee Hsien Loong said Dec. 31. Policy makers around the world have cut lending rates and increased spending to sustain growth.

“It’s going to be a tough time across Asia,” said Alvin Liew, an economist at Standard Chartered Plc in Singapore. “We don’t see any bright spots in the Singapore economy, especially in the first half.”

Gross domestic product contracted an annualized 12.5 percent in the fourth quarter from the previous three months, after shrinking a revised 5.4 percent between July and September. The Southeast Asian economy has declined for three straight quarters, joining Japan, Hong Kong and New Zealand in recession.

ECONOMIC CRISIS

THE FED cut interest rates dramatically at its September 18 meeting, reducing the benchmark rate that governs short-term lending between financial institutions, by 50 basis points, or half a percent. The banks then cut their prime rate for commercial loans by an equal amount. This was twice the 25-basis-point cut that was expected from the Fed.

Immediately, the stock market had its best single day in nearly five years, and stockbrokers and the media were suddenly assuring us that now that the Fed had acted, there was little possibility of recession.

But a more serious analysis reveals a different picture: first, the rate cut proves that the threat of a recession accelerated by the bursting of the housing bubble is real enough for the Fed to try to mitigate its effect; second, the economic situation has deteriorated quicker and more deeply than was expected, meaning that recession is closer to becoming a reality; and third, the various actions the Fed had taken to this point (pumping cash into the banking system and cutting its discount rate) failed to stop the downward slide, so stronger measures were necessary to prevent the crisis in the credit markets from overwhelming the real economy.

Inflation

The rate at which the general level of prices for goods and services is rising, and, subsequently, purchasing power is falling