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TOP HEADLINES 28 April 2011
1. INDIA: Making money transfers easier for migrants
2. INDONESIA: Ending tariffs a step in the right direction
3. TAJIKISTAN: Dushanbe feeling economic squeeze
4. BANGLADESH: Soaring land prices hurt FDI, business
5. PAKISTAN: No bank credit for small enterprises
6. VIET NAM: Construction of mega airport approved
7. CAMBODIA: Garment exports rise as trade gap widens
8. SRI LANKA: Pension scheme for private sector applauded
9. INDONESIA: Government says it is ready for food, oil shocks
10. BANGLADESH: Access to IT improving
IN DEPTH
1. INDIA: Making money transfers easier for migrants
Source: Hindu Business Line

"In India approximately 100 million people who migrate outside their native towns and villages for work face the challenge of sending money home. To remit funds, migrants require access to financial service points. Formal service points include banks, post offices and mobile banking points, while informal channels are friends carrying cash or couriers. A 2010 study found that 57 percent of migrants use informal channels. The study also found that while over 50 percent of migrants expressed a desire to remit through banks, only 31 percent actually did so.

Despite the existence of formal options such as India Post, which has 150,000 branches across the country, why do a majority of migrants use informal channels? The answer lies largely in the ease of access to informal sources compared to formal ones. Opening a bank account for migrants and their families requires address and identity proof, which are, invariably, difficult to obtain. Further, the transfers are generally slow, especially in remote locations."



2. INDONESIA: Ending tariffs a step in the right direction
Source: Jakarta Globe

"It was some time in coming, but the Indonesian government's decision to eliminate import tariffs on capital goods and machinery to help local industries compete against regional competition is a step in the right direction. The Finance Ministry did away with import duties on 182 raw materials and capital goods. The move will affect the basic chemical manufacturing, food manufacturing, machinery, electronics and shipping sectors. Previously, the tariffs for the products had been at 5 percent.

Slashing import tariffs is the correct response to facing competition -- especially from China -- and it will boost free trade. By ensuring local manufacturers are not handicapped by higher costs, the government has given them the tools to compete. This policy is also correct in the overall direction of developing domestic industries. The manufacturing industry is one of the biggest employers in the country. With lower or zero tariffs, more of these companies will be able to expand and, in the process, create new jobs."



3. TAJIKISTAN: Dushanbe feeling economic squeeze
Source: Eurasia Net

"On top of electricity shortages, Dushanbe has been hit by a drastic rail transit rate hike imposed by Uzbekistan, and a potentially devastating increase in energy export tariffs levied by Russia. The price of petrol in Tajikistan has shot up 6 percent already this month, causing the annual inflation rate to exceed 30 percent. Tajikistan had benefited from tariff-free energy exports from Russia for 15 years until the Kremlin implemented tariffs in mid-2010.

The April tariff increase is pummeling Tajikistan's beleaguered agricultural sector, driving up costs for farmers amid the spring planting season. The end result will be a substantial rise in the cost of food later this year in Central Asia's poorest nation. According to official statistics, Tajikistanis already spend more than 60 percent of their income on food. Compounding the trouble, on March 20, Uzbekistan increased railroad tariffs by 74 percent for goods transiting to Tajikistan in freight cars."



4. BANGLADESH: Soaring land prices hurt FDI, business
Source: Daily Star

"Soaring land prices and hassles in land acquisition deter inflows of foreign investment and the expansion of local businesses in Bangladesh, according to two international organizations. The land issue has made the country's development challenges more critical as Bangladesh faces two other major challenges -- how to upgrade infrastructure and ensure a large and skilled workforce.

Bangladesh has received only $697 million in foreign direct investments (FDI) during the first 10 months of 2010 against registrations for $3.05 billion during the year, according to the Board of Investment. In 2009, FDI inflow into Bangladesh was $700 million. Inadequate land and industrial plots and a lack of utilities are the major reasons behind the slump in FDI inflows."



5. PAKISTAN: No bank credit for small enterprises
Source: Dawn

"Small enterprises in Pakistan remain credit constrained and outside the formal financial system in spite of significant growth of the banking industry and the introduction of policies to improve their access to finance over the last decade, according to an industry insider. The lack of formal credit was forcing smaller entrepreneurs to fund their working capital and new investment requirements from their savings, from borrowings from friends and relatives or from the informal sector at a very high price.

While the high cost of credit may be an issue with medium sized enterprises, according to the official, it was not a problem for the small ones because they were paying more than 50 percent interest on credit obtained from the informal sector. A World Bank report in 2009 also said the micro and small enterprises had seen a worsening of access to finance, while medium-size enterprises witnessed improvements."



6. VIET NAM: Construction of mega airport approved
Source: Thanhnien News

"Prime Minister Nguyen Tan Dung has approved a plan to construct a mega airport near Ho Chi Minh City (HCMC). The first phase of construction at Long Thanh International Airport in southern Dong Nai Province, some 40 kilometers northeast of HCMC, will begin in 2015 and is expected to finish by 2020. According to the plan submitted by the Transport Ministry, three runways and two terminals in the 5,000-hectare airport will be able to handle 50 million passengers a year by 2030.

The cargo terminal will have a capacity to handle 1.5 million tons annually. The airport, estimated to cost $10 billion, will be financed by government budgets, and private and foreign funds. The Long Thanh Airport is expected to ease the burden on HCMC's Tan Son Nhat International Airport, currently the country's largest, which has a footfall of 12 million passengers and handles 278,000 tons of cargo a year."



 DEVBlogs ROUNDUP
Over the past decade, access to education for all Cambodians has always been a hot issue which attracts a lot of attention from the government, educational institutions, and local and international agencies. The main concern is how to provide greater access to education for all Cambodian citizens. There is a shortage of schools in most parts of Cambodia, especially in rural and remote ones. Some schools do not have good roofs, good floors, good walls, drinking water supply, and latrine facilities. Many rural Cambodian families cannot afford to send their children to school because their families are financially deprived.


7. CAMBODIA: Garment exports rise as trade gap widens
Source: Phnom Penh Post

"Global economic growth boosted Cambodia's exports nearly 50 percent in the first quarter compared year on year, though the trade deficit expanded during the period, Ministry of Commerce officials said. Exports increased 49.6 percent to $1.13 billion between January and March, up from $756.6 million the year before, according to the figures.

The growth was driven by an increase in garments and textiles, but also agricultural products, according to Ministry of Commerce Secretary of State Ok Boung. Garments and textiles, Cambodia's main export, rose 45.5 percent in the first quarter to a total of $976 million from $670.9 million. Agricultural products, including milled and unmilled rice, corn, cassava, rubber and processed timber, climbed to $112.8 million, a rise of more than 238 percent from the same period in 2010, ministry statistics show."



8. SRI LANKA: Pension scheme for private sector applauded
Source: Daily News

"A pension scheme for private sector employees is, on the face of it, a laudable measure and needs to be warmly welcomed. The prime reason for this is the inability of many private sector personnel to cope with living costs and related difficulties once they retire from service. Therefore, a pension payment would be hugely welcomed by most of these retired employees in the evening of their lives.

The pension bill is an intrinsically good one and needs to be looked upon favorably. This is on account of the relief it potentially offers to all private sector employees who, thus far, have had to fall back on only their end-of-employment payments, as security against a usually uncertain economic future."



9. INDONESIA: Government says it is ready for food, oil shocks
Source: Jakarta Globe

"Indonesian Trade Minister Mari Elka Pangestu said that although there was concern about surging food and oil prices, Southeast Asia's largest economy has taken the necessary measures to protect its poor and unemployed. She was commenting on an Asian Development Bank report that said increasing food prices coupled with the rising cost of crude oil are threatening to push 64 million people in Asia into extreme poverty.

The government, she said, has come out with a number of regulations to stabilize the price and supply of rice. Mari said it was important to protect the poor from rising food prices with programs such as Raskin, or rice for the poor, household programs and subsidized cooking oil for the poor. She added that ASEAN agriculture ministers are discussing an emergency rice reserve and pushing for food security to become the main topic at the next G-20 meeting."



10. BANGLADESH: Access to IT improving
Source: Financial Express

"Before 2008, the use of the Internet was cumbersome and costly in Bangladesh as Internet service providers gave connections to individual subscribers through high-speed VSAT. But connection to a submarine cable has changed the situation vastly with much faster connections at the individual and institutional users' levels in recent years as well as the falling costs for such connections. The access to Internet connections has also become even better very recently after the introduction of wireless technology.

The availability of online Internet services is making significant positive changes in the country. The benefits for business communications, both with respect to cost savings and speed, are noteworthy. Bangladesh should place priority on providing Internet access to academic institutions and to intellectual communities. It is also very important to take further steps to decrease the costs of Internet use."



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