Pokemon GO launches in Japan, bringing smash-hit game home

Eager Japanese rushed to their phones on Friday to start hunting as Pokemon GO, the hit Nintendo-backed smartphone game, finally launched in Japan, home of the colourful cartoon characters.

The game has been an unexpected, runaway success from Spain to Australia, doubling Nintendo's value since the game's launch in the United States earlier this month.

Japan, however, had been made to wait, as Niantic, the developers behind the game, and Nintendo sought to ensure servers would withstand the game's popularity. Finally, after days of rumours, it launched on Friday.

"Everyone was talking about why we couldn't do it here, since Pokemon is Japanese," said Maho Ishikawa, a 16-year-old high school student who said she had already captured a monster.

"Since I really wanted to play, I'm very, very glad."

The augmented reality game has players out in their real life neighbourhoods 'capturing' monsters on their smartphones as they turn up even in ordinary offices and taxis.

In a video address to Japanese fans, Junichi Masuda, head of development at Game Freak and co-creator of the game, apologised for keeping players waiting so long.

"From today you can go out and find Pokemon to your heart's content," he said. "We hope the game enables users to see the world in a new, fulfilling way. Obey the rules and have fun."

University students in Tokyo on their last day of classes before summer holidays did just that, jumping into the fray within moments of the launch, capturing monsters as a frenzy erupted between classes.

"This game is just as I imagined it to be, it's really fun," said Toshinori Ishibashi, 18, who was seen playing the game near a Pokemon goods store in Tokyo Station.

"It's also a great reason to go outside, so I'm really enjoying it."

The game was created by Nintendo, Niantic and Pokemon Co, part-owned by Nintendo. Both Nintendo and Pokemon Co have undisclosed stakes in Niantic.

As retailers and brands vie for a piece of a hit that takes players from place to place, fast food chain McDonald's Holdings Co Japan Ltd said its nearly 3,000 shops across Japan would serve as spots where Pokemon can be battled or "trained" in the game - within limits.

"Ultimately, McDonald's is a restaurant," said a company spokesman. "We will call on players not to become a bother to customers who are eating."

The game has enthralled players and boosted investors' view of Nintendo's future, as they bet the group can cash in on a treasure chest of other lucrative cartoon characters, from Donkey Kong to Super Mario.

But the game has also prompted warnings, as players glued to their phones become prone to tripping over, crashing cars, getting mugged or wandering into dangerous places.

The Japanese government on Thursday became the latest to issue a safety warning. The country's National Center for Incident Readiness and Strategy for Cybersecurity (NISC) told users of the mobile game not to use their real names and warned them about the risks of heat stroke in the muggy Japanese summer.

A number of other Asian nations still await the game, including China, the world's biggest smartphone and online gaming market. Niantic Chief Executive John Hanke has said it would be technically possible to launch there, but noted a host of complex rules and restrictions.

Nintendo shares, which have seen a meteoric rise in recent days, climbed in Tokyo trading on Friday but pared gains to close up under 1 percent. McDonald's Japan ended up 4.2 percent.

Stockmarket looks to banks for fresh funds

Thirteen commercial banks are now free to make fresh investments of up to Tk 1,500 crore in listed securities -- cheery news for the ailing stockmarket.

The development comes after Bangladesh Bank allowed the banks to restructure their balance sheets such that their investment exposure to the stockmarket fell within 25 percent of their total capital by July 21 in line with the Banking Companies Act 2013.

The banks converted their share credit in their subsidiaries into the latter's capital.

As a result, the total capital of 13 banks' subsidiaries increased by about Tk 3,540 crore: Tk 1,984 crore in loans, Tk 1,294 crore invested in shares, Tk 41 crore in mutual funds and Tk 220 crore invested in placement shares.

The central bank's policy support not only strengthened the subsidiary companies' capital structure but also brought down the banks' investment exposure below the permissible limit without selling any shares to the market, BB Deputy Governor SK Sur Chowdhury told a group of reporters on Thursday.

“The move also created an opportunity for 13 banks to make fresh investments of up to Tk 1,500 crore in the stockmarket,” he said, adding that all commercial banks can make investments of up to Tk 4,500 crore in the market.  A positive move on the banks' capital market investment exposure was a long demand from the stakeholders, so that the banks, which are the major institutional investors, can make fresh investment in the secondary market, said Akter H Sannamat, a market analyst.

“Now the banks are compliant and don't need to sell shares to adjust their investment exposure. They can also take the opportunity of investing in securities that are being traded at comparatively low prices.” On the other hand, it will have a positive impact on general investors' mind too.

“The general investors always feared an extra selling pressure from banks to adjust their investment exposure,” said Sannamat, also former managing director of Union Capital and Prime Finance and Investment.

The central bank's move will ensure the banks' active participation as institutional investors in the ailing secondary market, he added. The stockmarket is maintaining a bearish trend since the inevitable price crash of early 2011.

DSEX, the key index of the Dhaka Stock Exchange, stood at 4,077 points last Thursday. It was 5,334 points even less than two years ago.

Samsung sues Huawei over patents

Shares in Samsung Electronics have dropped after the smartphone giant sued rival Huawei in multiple courts in China over alleged patent infringement.

They closed down 1.8% in Seoul.

The country's benchmark Kospi index wrapped the day flat at 2,010.34.

The two companies are already entangled in several legal battles over the use of proprietary technology, including fourth-generation (4G) cellular technology, operating systems and user interface software.

Huawei sued Samsung in the US in May.

The rest of Asia's share market are mostly lower on Friday due to a tepid earnings season so far on Wall Street.

Japan's Nikkei 225 closed 1.1% lower at 16,627.25 points.

Nintendo shares ended the day 0.8% higher after earlier jumping by nearly 5% on news it's finally launched the wildly popular Pokemon Go in Japan.

Australian shares finished down 0.3% at 5,498.20

Hong Kong's Hang Seng wrapped up trading flat at 21,964.27, while the mainland's Shanghai Composite closed 0.9% down at 3,012.43 points.

Italy has 'no banking problem': finance minister

Italy does not have a problem with its banks, finance minister Pier Carlo Padoan said Sunday, despite investors fretting about nearly $400 billion of bad debts weighing down the sector.

Fears of a renewed eurozone debt crisis are rife on the financial markets if Italy does not address the 360 billion euros ($398 billion) in bad debt sitting in its banks.

Markets have turned sour on several Italian banks, most notably Italy's number-three lender and the world's oldest bank, Banca Monte Paschi.

But Padoan sought to calm nerves on the sidelines of a G20 finance chiefs meeting in the Chinese city of Chengdu.

"All the countries should relax: there is no Italian banking problem," he told AFP.

"There is an economy which has been in recession for three years, there is accumulated non-performing loans, which have been dealt with," he said.

The numbers that were "floating around" were "vastly exaggerated", he added, saying that "a few cases" would be "adjusted".

New eurozone rules limit the use of public money to bail out banks unless investors are required to bear part of the burden, potentially restricting Rome's scope to intervene.

A scheme to rescue Greek private banks a year ago came with demands that the rescued lenders must dispose of assets and cut jobs.

But Padoan insisted that there were "no tensions" between Italy and the European Commission on the issue.

"We are not on a bail-out regime, we are in a bail-in regime, and all the instruments that are considered are within those rules," he said. "There is no need to bail out anybody."

Bad debts restrict economic growth as they reduce the amount of money banks have available to lend, while a banking failure can send shockwaves through the real economy if companies find their access to funds cut off, or debts are called in.

The Italian banking issue was discussed by the G20 meeting, and EU economy chief Pierre Moscovici said that the solution had to be compliant with the EU's common rules.

The messages from the Italian representatives had been "quite affirmative and reassuring", he added.

US officials said that Treasury Secretary Jacob Lew and Padoan had discussed "recent developments in the European banking sector" on the sidelines of the G20 gathering.

In a statement, the US Treasury said that Lew had "noted that while Europe's banking system is stronger as a whole due to reforms put in place in recent years, more work remains".

Clouds gather for Turkey economy after attempted coup

A 6 percent loss in value of its currency, a plunge on the stock market and a downgrade by a key ratings agency.

The last week alone has shown that life is not going to be easy for Turkey's economy after the coup aimed at unseating President Recep Tayyip Erdogan from power.

But economists say a sharply lower economic performance including a recession is not inevitable and avoiding doom-laden scenarios largely rests on the choices Erdogan and his government make.

Since the coup more than a week ago, the lira lost six percent of its value against the US dollar. More than 10 percent in value has been wiped off the stock market.

"Turkey's ultimate fragility is the fact that it cannot afford to see the currency go where it may," Michael Harris, Turkey strategist and head of research at Renaissance Capital told AFP. He said in countries from Britain to South Africa falls in the value of currency mean people would lose money but do not alter the macroeconomic dynamics in a substantial way like in Turkey.

Instead, in a country that has experienced high inflation, a weaker exchange rate risks placing further upward pressure on consumer prices.

The authorities have had some success in pushing down inflation in recent months, reaching 6.57 percent in May.

"In Turkey if the currency falls too much, it's very painful for Turkish corporates. And that then leads to the recessionary scenario," said Harris.

Turkey experienced a banking crisis in the early 1990s and high inflation followed by a full financial crisis in 2000-2001 that nearly sent the economy into meltdown.

For many Turks, the six zeros on a bank note and needing to be lira millionaires to make simple purchases is a painful memory.

Since the ruling Justice and Development Party (AKP) co-founded by Erdogan, came to power in 2002, Turks have grown accustomed to solid GDP growth, outperforming fellow emerging markets excluding India and China.

But that could soon come to an end, said William Jackson, senior emerging markets economist at Capital Economics, warning of a potential recession.

"I think if growth and incomes were to weaken, potentially we can see some rise in non-performing loans and tighter credit conditions," he told AFP.

"So there are quite a number of factors that could lead to a sharp slowdown in the economy at some point in the next few years -- potentially even a recession."

The economy was set to grow by 3.5 to 4 percent this year according to the International Monetary Fund, and so far this year growth has remained robust supported by high government spending and low oil prices.

Externally, however, Turkey has long been vulnerable to any sudden shifts in investor sentiment towards a country which has long run a bloated current account deficit.

This makes it reliant on 'hot flows' of capital which could suddenly dry up in the wake of a serious political or economic drama.

A relentless crackdown on suspected coup plotters has sparked concern Erdogan will use the current climate to push through his plan for an executive presidency that would further bolster his powers and also worry investors.

"They (Turkish government) have to make the right policy choices. If it's just about punishment and stabilisation then we'll get through this," Harris said.

"If it's about the catalyst for trying to become president for life, the transition will be quite turbulent, quite long lasting I would have thought."

Beatnik: most creative mind

Beatnik Designs, a Dhaka-based design studio and a digital agency, yesterday beat 21 others to win this year's Lions Edit Competition Bangladesh, a contest for the most creative young professionals in the country.

Walid Uz Zaman Khan, managing partner and head of design, and Andalib Kabir, managing partner and head of operations, finished the race as winners.

They will now get the chance, along with the runners-up, to compete in the Spikes Asia 2016, the region's oldest award for excellence in creative communication, to be held in Singapore in September.

StrateGeek, a digital agency teamed up by Samanta Sarni Tira, senior strategic partner, and Maleena Gomez, art director, came in as runners-up. 

The winners were picked in a daylong event held at The Daily Star Centre in Dhaka. The Marketing Society of Bangladesh is the knowledge partner for the event and Roaring Lions the strategic partner.

The competition is an annual hunt. With a mission to finding out the most creative and competitive young professionals in marketing communication, Bangladesh Brand Forum and The Daily Star, in association with Cannes Lions, initiated the Lions Edit Competition Bangladesh 2016.   Twenty-two teams, each comprising two members, from 13 creative agencies and three corporate houses participated in the competition. Based on a given case, the teams developed an integrated campaign within the allotted time.

For this year, the case for the teams was about solving the water crisis problem of Bangladesh. The developed campaigns focused on creating mass awareness, informing the people about the consequences of wasting water, generating buzz about the issue and bringing in positive changes in people's behaviour.

The teams showcased their campaigns with a five-minute presentation before an expert jury panel. The jury panel was comprised of: Aftab Mahbub Khurshid, head of business development of Super Star Group; GM Kamrul Hassan, chief executive of Igloo Ice Cream Company; and Khandaker Ashraful Haque, vice-president for market operation of Robi Axiata Ltd.

The teams came up with some tremendously interesting ideas -- from attractive print ads to interactive outdoor campaigns, said the organisers.

Spikes Asia is collaboration among Lions Festivals, Cannes Lions Festival, the world's biggest celebration of creativity in communications, and UK-based Haymarket Media Group.

The festival and awards provide the region's creative communications industry a platform to network and exchange ideas, bringing together the finest creative thinkers from around the world. 

Denim factories spring up as demand soars

Five denim factories came into operations in the last five years amid rising demand for denim products in the global market, said industry insiders.

Now the total number of denim factories in Bangladesh is 30.

Of the five factories, four have already gone into production -- Square, Nice, Thermax and Badsha, said Mostafiz Uddin, managing director of Chittagong-based Denim Expert and organiser of Bangladesh Denim Expo that takes place in Dhaka twice a year.

Another five companies plan to set up denim factories as the demand is on the rise, especially in the West, the major market of denim, said Mostafiz.

Bangladeshi manufacturers used to produce mainly basic denim products such as trousers, but now they also make shirts, bed sheets, pillow covers, home textiles, aprons and tablecloths, he said.

Production capacity of the denim mills in Bangladesh is more than 40 million yards a month against the demand for nearly 70 million yards. The rest of the demand is met through imports from countries like China, India, Pakistan and Turkey.

“Bangladesh has emerged as a strong player in the denim market worldwide. As the demand is rising globally, local entrepreneurs are investing more in the sector,” Mostafiz said.

The industry insiders said about Tk 8,000 crore has already been invested in denim business in Bangladesh.

In a few years, exports of denim products will rise to $5 billion, from more than $2 billion a year now.

Global denim sales amount to more than $56 billion a year now; the number is expected to reach $64 billion by the end of 2020.   In 2015, Bangladeshi denim products had a 22.88 percent market share in the EU and 11.35 percent in the US, according to US Department of Commerce.

Square Denim, which was established at an investment of Tk 400 crore, went into production a few months ago in its Habiganj factory, said Syed Ahmed Chowdhury, general manager (operations) of the company.

“Currently we are producing 1.5 million yards of denim a month although we have the capacity to produce 3 million yards. We will increase production gradually,” Chowdhury said.

Bangladeshi entrepreneurs supply denim products to major global retailers and brands, including H&M, Uniqlo, Levis, Nike, Tesco, Wrangler, s.Oliver, Hugo Boss, Walmart and Gap.

Low growth, weak trade sap German chemical industry

Germany's powerful chemicals sector will see a bigger decline in sales over 2016 than previously thought as weak global growth and trade undermine prices, the VCI industry federation said on Friday.

"Negative factors, such as weak growth in the emerging economies, little momentum in overall global trade, and the end of the worldwide investment boom" are weighing on Germany's third-largest industrial sector, president Marijn Dekkers said.

While production stagnated in the six months to June, sales in the sector fell to 90.4 billion euros ($100 billon) -- or a drop of 3.5 percent from the same period in 2015 --, the VCI said in its half-year report.

The positive effects for the sector of low oil prices and the weak euro were waning.

In addition, economic uncertainty sparked by Britain's June vote to leave the EU, and increased volatility in both raw materials prices and exchange rates "create difficult conditions for solid growth in the sector," said Dekkers.

NBR to discuss new VAT law with businesses

The National Board of Revenue plans to sit with businesses to resolve disputes related to the new VAT and Supplementary Duty law to ensure implementation of the law from July next year, officials said.

“We will have close and in-depth discussion with businessmen by the end of August,” NBR Chairman Md Nojibur Rahman told The Daily Star.

The revenue authority takes the initiative after the government backtracked on its plan to enforce the new VAT law from the start of the current fiscal year amid resistance from businesses and a section of revenue officials and inadequate preparation by the NBR.

The law to be implemented under an automated platform envisages a 15 percent flat VAT instead of various types of VAT rate now in effect under the VAT Act 1991.

The Federation of Bangladesh Chambers of Commerce and Industry has long been demanding inclusion of its recommendations in the new law.

The apex trade body says businesses, particularly small and medium enterprises, will be affected if the law is implemented without addressing their concerns.

The FBCCI demands inclusion of the recommendations of a panel formed by the government in 2014 with representatives from businesses and the NBR.

The panel suggested multiple rates of VAT on goods and services instead of the universal rate of 15 percent.

The government formed the committee to review the law in the face of criticism from businesses that their recommendations and concerns were not reflected in the VAT law.

The FBCCI in its recommendations demanded reduction of the turnover tax rate to 0.5 percent from 3 percent and raising the upper limit of annual turnover for firms to Tk 5 crore from Tk 80 lakh.

“We will sit with them to discuss their proposals and decide which proposals are acceptable and which are not,” said a senior official of NBR, asking not to be named.

“We want to come to a decision to ensure that the law is implemented in the next fiscal year without any confrontation.”

He said the new law may need amendment after consultation with businesses.

“We want to be fully ready with everything by December this year.”

To start implementing the law, the NBR plans to launch online registration of business identification numbers (BINs) for firms in August.

Once the new VAT law comes into effect, firms will have to get nine-digit BINs by signing up online, which will replace the present 11-digit ones.

The official said there are 840,000 BINs in the NBR database and many of those are fake and inactive.

The fresh BINs will enable the revenue authority to get the actual number of VAT payable entities.

The NBR also plans to start testing the online return filing system from October this year as part of its preparation to introduce an online VAT system under the new law.

The VAT law passed in parliament in 2012 was initially scheduled to be implemented from July 2015. Framed at the prescription of the International Monetary Fund, the new law is expected to boost the state's revenue collection, curb corruption and tax evasion and improve transparency in the VAT administration.

The government with the support from the World Bank is now implementing a Tk 551 crore project to develop an automated VAT system to enforce the new law.

The automation will reduce both administration and compliance costs as businesses will be able to file returns and pay taxes online.

But there are concerns that the implementation of the new law with a 15 percent VAT rate may fuel the cost of living because of the hike in prices of many goods and services, according to a paper prepared by the NBR early this year.

The abolition of VAT exemption for nearly 2,000 products and services, and the end of tariff or administered value of nearly 85 products as well as the truncated system are likely to impact consumers.

The implementation of the law may also reduce competitiveness of various domestic industrial sectors due to trimming of the list of items that face supplementary duty at the import stage, it observed.

Pay heed to youth labour force to fight militancy: economist

Bangladesh should pay heed to the needs of the youth labour force and meet their expectations in a rapidly changing world to fight militancy, a noted economist said yesterday.

“We need to worry about the vulnerable non-poor, especially the problem of the youth labour force belonging to a group, in terms of meeting their new expectations and extremism,” said Binayek Sen, research director of the Bangladesh Institute of Development Studies (BIDS).

By vulnerable non-poor, he meant people whose per capita income stands between $1 and $2 a day; they form 39 percent of the population.

The economist made the remarks at a national dialogue on the role of the budget and other policy frameworks in cutting inequality and poverty at Sonargaon Hotel in Dhaka.

The All Party Parliamentary Group organised the programme in association with Oxfam, an alliance of international non-governmental organisations.

Bangladesh has a large young and productive workforce that will continue to increase until 2030.

Of the country's 16 crore population, 10.5 crore are between 15 years and 64 years of age. This age-group would increase to 13 crore by 2030, said the United Nations Development Programme in April.

Every year, 20 lakh people join the labour force. But only some six lakh jobs were created in the last two years, which should have actually been 26 lakh. Nearly 74 percent of the jobless people are young.

The government should also think about the stubborn pockets of poverty caused by river erosion and such in the areas of haors and hill tracts, the economist added.

Speaking at the event, Finance Minister AMA Muhith said population control is a big problem in the way towards development. Hence, focus should be on family planning.

Strict measures should be taken to keep the population of the country within 20 crore, he added.

The minister said social safety net programmes in Bangladesh are the best in the world. The safety net money reaches the beneficiaries through banks and no pilferage is reported in this area, he added.

Muhith said electronic systems have to be introduced in all transactions, payment and trading to cut corruption.

“To reduce corruption, we have enacted various laws, and the Anti-Corruption Commission has been restructured but it could not make much progress.”

The finance minister said a college in Sylhet introduced an online admission system, which resulted in a hike in its annual income -- from Tk 8 lakh to Tk 83 lakh.

Abdur Razzaque, chairman of the parliamentary standing committee on the finance ministry, said food production increased in Bangladesh but the farmers are not getting fair prices for their produce.

It cost Tk 700 to produce a maund (37.32 kilograms) of rice this year, but depending on varieties, farmers got Tk 450 to Tk 650 a maund during the harvesting period.

But Razzaque, also a former food minister, said farmers are now getting Tk 900 a maund upon selling rice to the government warehouses.  Razzaque said the government will have to take steps to ensure fair prices for the farmers.

Information Minister Hasanul Haq Inu said 25 percent of Bangladesh's people are still poor and 15 percent are ultra-poor. “Lifting them out of the poverty trap is a challenge.” Separate projects will have to be taken for the people living in the remote areas, he added.

Ifad to start auto assembly in Sep

Ifad Autos, which is building the country's largest auto assembly plant at Tk 90 crore, is expected to roll out its first vehicle in September.

Initially, the plant aimed to assemble 4,000 trucks and buses a year, but revised the annual target higher at 7,000 vehicles, buoyed by the growth of the local market.

“We expect to launch our first product in September this year,” said Taskeen Ahmed, managing director of Ifad Autos, a unit of Ifad Group that has presence from fast-moving consumer goods to agro-products and chemicals.

Primarily, the plant will assemble heavy buses and trucks of Ashok Leyland, a leading Indian automobile manufacturer.

Ifad, which was previously Ashok Leyland's sole distributor in Bangladesh for about three decades, is now its strategic partner in the country.

Ifad provides a full line of heavy duty trucks, buses and special service vehicles from Ashok Leyland of India.

Ashok Leyland is concentrated on heavy buses and trucks. It has presence in the entire truck range, starting from 7.5 tonnes to 49 tonnes.

Recently, the company has tied up with Nissan Motors of Japan to make light commercial vehicles or LCVs of less than 7.5 tonnes.

“We will also assemble and sell LCVs here,” said Ahmed, who is also the president of the India-Bangladesh Chamber of Commerce and Industry.

With the consistent economic growth of over 6 percent for the last one decade, Bangladesh is becoming an emerging market for the transport sector.

About 12,000 trucks of 3.5 tonnes to 7 tonnes are sold a year in Bangladesh, according to industry insiders.

In addition, several thousand pickups, which carry 1 to 2 tonnes of goods, are sold a year, they added.

Ashok Leyland and Tata dominate Bangladesh's commercial vehicle market, with 35 percent market share each.

In the bus segment, Ashok Leyland is the market leader in Bangladesh.

Until recent years, Japan-made LCVs dominated the market, but now the vehicles manufactured by Tata have become the market leader.

Ifad also aims to capture the body building market of all sorts of vehicles, from cars to LCVs and heavy vehicles of different brands.

“We will be able to make a body of a heavy bus or truck in just six days at our plant instead of several months presently required by others,” Ahmed told The Daily Star by phone yesterday. 

Starting out as a private enterprise in 1985, Ifad Autos has built a countrywide network with offices, dealers and showrooms.  The company came to Bangladesh's capital market in late 2014 to carry out its expansion plans, especially the state-of-the-art assembly plant in Bangladesh.

Premier Cement takes up Tk 400cr expansion plan

Premier Cement Mills plans to double its production capacity with an approximate investment of Tk 400 crore to meet the growing demand for the construction material.

The company's current production capacity is 6,000 tonnes a day, which will be increased to 16,000 tonnes through the expansion plan approved yesterday at a board meeting.

The cement industry is growing by around 22.5 percent a year, mainly driven by infrastructure development, said Md Shafiqul Islam Talukder, chief financial officer of Premier Cement.

“So, we want to increase our production volume as well as the market share.”

The expansion, which will be completed by 2018, will also help the listed cement manufacturer to make more revenue and profit, he said.

Of the expected investment of Tk 400 crore, Tk 209 crore will be used for machinery and equipment import and the remaining Tk 191 crore for construction and other local purposes.

Commercial production at the extended unit can be started soon after the completion of the expansion by 2018, Talukder said.

With 30 cement manufacturers around, the country has an installed production capacity of 3.5 crore tonnes a year at present against the local demand of around two crore tonnes.

Although local production is enough to meet the current demand, the country's per capita cement consumption is only around 105 kilograms, which is 215kg in India, 310kg in Sri Lanka, 170kg in Pakistan, 320kg in Malaysia and 1,700kg in China.

Premier Cement traded between Tk 89.8 and Tk 91.5 per share on the Dhaka Stock Exchange yesterday before closing at Tk 91.

The company's net profit stood at Tk 40.39 crore at the end of 2015 and basic earnings per share Tk 3.83, down from Tk 50.41 crore and Tk 4.78 respectively a year earlier.

Sponsors own an 86.08 percent stake in Premier Cement, institutional investors 6.66 percent, foreign investors 0.03 percent and the general public 7.23 percent.

Bank hacks raise fears for financial sector

A series of spectacular cyber attacks against banks, resulting in the theft of tens of millions of dollars, has heightened fears for an industry becoming an increasingly attractive target for hackers.

Banks in Bangladesh, the Philippines, Vietnam and Ecuador have been victimized over the past year in the attacks on the global interbank service known as SWIFT, and some analysts expect more attacks to become public.

After news of the $81 million heist from Bangladesh's central bank became public in May, SWIFT said the incident was "not a single occurrence, but part of a wider and highly adaptive campaign targeting banks."

Since then, officials said banks have also been hit in the Philippines and Vietnam.

Meanwhile Ecuador's Banco del Austro claimed in a lawsuit that hackers made off with more than $9 million through fraudulent SWIFT transfer requests.

Cyber security specialists say these attacks are likely just the tip of the iceberg, and expect more revelations.

"Cyber criminals are no longer targeting grandmothers at home for small amounts, but going directly where the money is," said Juan Andres Guerrero-Saade, a researcher with the security firm Kaspersky.

Guerrero-Saade said it's not clear where the attacks are coming from, but that the hackers are using techniques similar to those developed for cyber espionage.

"I don't think this implies it's nation-states, it's more of an evolution," the analyst said. "It's criminal actors taking on some of those techniques."

Kaspersky researchers last year uncovered a hacker group which targeted banks in Eastern Europe, estimating losses totaling up to $1 billion.

Dan Guido, cofounder of the security firm Trail of Bits and hacker-in-residence at New York University's engineering school, said the recent security breaches are not surprising.

"I didn't think it would take this long," Guido said.

"There are a large number of attacks like this possible if someone has the resources to do it."

Guido said a relatively small team of determined hackers could carry out the kind of hacks that went through SWIFT, or the Society for Worldwide Interbank Financial Telecommunication, a Brussels-based network which is used by more than 11,000 financial institutions in 200 countries.

The blame, Guido said, rests squarely with SWIFT for failing to bolster its software or require more secure hardware.

"It's clearly within their control to have prevented incidents like this," Guido said.

"They could have had more aggressive security requirements, they could have had protective hardware."

On July 11, SWIFT announced it had hired cyber security firms BAE Systems and Fox-IT while creating its own security intelligence team in an effort to thwart attacks.

In the United States, concerns have been raised among officials, industry leaders and lawmakers about potential threats to banks from hackers.

Data breaches in the past affected some tens of millions of JPMorgan Chase customers, and accounts from financial giant Morgan Stanley. And a congressional report in June found "major data breaches" at the Federal Deposit Insurance Corporation.

Senator Tom Carper last month asked the Department of Homeland Security for a briefing for an investigation into vulnerabilities of the US financial system.

The American Bankers Association in July joined with other financial and security organizations to warn of possible risks.

"While recent events targeted national financial institutions with access to a global payment network, financial institutions should assess the risk of all critical systems to ensure appropriate controls are in place," said the warning, calling for a series of new controls and safeguards against cyber attacks.

Christiaan Beek of Intel's McAfee Labs said the hackers that targeted SWIFT were well organized and resourceful.

"We can see that the attackers have done their reconnaissance properly and may have used an insider to get the details they needed to prepare their attack," Beek said in a blog post.

"The attackers have a very good understanding of the SWIFT messaging system and how to manipulate the system to prevent the detection of their fraudulent attempts of transferring the money."

Researchers at the security firm Symantec concluded that malware used in the bank hacks shared code with that used in the massive 2014 cyber attack against Sony Pictures.

Guido said it is entirely plausible that US banks could face similar attacks. "I don't see why it can't happen here," he said.

"There are a lot of smaller banks that don't have expertise and guidance to protect their interconnections."

Guerrero-Saade said a key part of staying ahead of hackers is sharing information about threats to enable security solutions, since many companies fear disclosure would hurt their business.

"Sadly most companies don't tend to be very forward looking, they think that if they don't sound the bell themselves no one will find out," he said.

"It's much better for us to get ahead of this as an international community."

Beijing slaps EU, Japan, S Korea with steel duties

China said Sunday it has started imposing anti-dumping tariffs on certain steel imports from the European Union, Japan and South Korea, as Beijing itself comes under fire for similar trade practices.

Duties on the materials, used in power transformers and electric motors, will range from around 37 to as high as 46.3 percent, the commerce ministry said on its website. The measures are intended to prevent the sale of the product at below cost, a practice known as dumping, it added.

Tesla, SolarCity close to merger agreement

Tesla Motors Inc and SolarCity Corp have made progress in putting together a deal that will merge the electric car maker and the solar panel installer, people familiar with the matter said.

The two companies, which count billionaire Elon Musk as a major shareholder, are in the final stages of carrying out due diligence on each other, and could agree on the terms of a deal in the coming days, though it is still possible that their negotiations end unsuccessfully, the people said on Saturday.

It could not be learned whether SolarCity would be successful in including a go-shop provision in a merger agreement with Tesla that would allow it to continue to solicit bids from other potential buyers for a short period of time.

The sources asked not to be identified because the negotiations are confidential. Representatives for SolarCity and Tesla did not immediately respond to requests for comment.

Tesla announced last month that it had made an all-stock offer for SolarCity worth $2.8 billion. It argued that by acquiring SolarCity, the two companies would form a one-stop clean energy shop, offering consumers solar panels, home battery storage and electric cars under a single trusted brand.

SolarCity has not publicly revealed its views on Tesla's offer since it announced on June 27 that it had formed a special committee consisting of two board members to evaluate the offer. The committee said it had retained legal and financial advisers and would review the proposal against SolarCity's standalone prospects and a broad range of strategic alternatives.

As chief executive of Tesla, chairman of SolarCity and the biggest shareholder in both companies, Musk has recused himself from voting on the deal at both companies. Several Tesla and SolarCity executives, including Musk's cousins SolarCity CEO Lyndon Rive and SolarCity board member Peter Rive, have also recused themselves from voting.

Elon Musk said on July 20 when he revealed his master plan "part deux" for Tesla that he is looking to create a "smoothly integrated and beautiful solar-roof-with-battery product."

"We can't do this well if Tesla and SolarCity are different companies, which is why we need to combine and break down the barriers inherent to being separate companies," Musk said.

Priced out by tourists: the Airbnb effect in Lisbon's historic centre

Alfama, one of the oldest and most picturesque areas of Lisbon, is becoming a victim of its own charm. Short-term lets to tourists are driving up rents and driving out old residents.

"They want to throw me out to rent my home to tourists," complained retired salesman Antonio Melo, 70. His house has changed owners four times over the last year and his new landlord has just told him his lease will not be renewed.

"Soon there will only be tourists in Alfama," he said. Melo has lived in the district since he was five years old but now fears he will have no choice but to leave because his 600-euro pension won't cover the rent of any property there.

Local mayor Miguel Coelho echoed the concerns of many in Alfama.

"Real estate speculation in Lisbon's historic centre, which is particularly evident in Alfama, is causing a lot of stress," he said.

"House prices and rents are exorbitant and people are having to think about other options," he added.

The mayors of three of Lisbon's central districts have called on the government to intervene urgently. They attributed spiralling prices to an "excessive proliferation" of short-term rentals. Coelho said that while tourism was a boon to the local economy, "when it becomes excessive it's a real threat to the district's identity".

This is especially so in Alfama, a pretty maze of narrow streets leading up from the Tagus estuary that is one of Lisbon's biggest tourist attractions. "Every day we see estate agents going door to door to find people willing to leave," said Ana Gago, a 28-year-old geography student who is conducting a survey of people moving out of the district because of the rising costs.

Airbnb, the world's leader in short-term private rentals, says bookings in Lisbon using its service doubled in 2015, to 433,000 visitors. The traditional hotel sector saw bookings by foreign tourists rise by a more modest 7.5 percent.

In Lisbon, which is among Airbnb's top 10 global destinations, those renting space via the company are not just "hosts" offering a spare room to "guests": over a quarter of owners place more than one advertisement on the site, and 73 percent have whole apartments available.

Cities like Berlin and San Fransisco have taken steps to prevent landlords abandoning residential leases in favour of short holiday lets, and have kept rents in check as a result.

Conversely, Portugal, hit hard by a financial crisis in 2011, levies less tax on income derived on rent from tourists than it does on that from longer term tenants.

The idea was to attract foreign investment and boost the real estate sector, and the policy has contributed to the renovation of many dilapidated buildings.

But it risks accelerating Lisbon's population flight: half a million people now live in the city, against 800,000 in the early 1980s.

"It's good to renovate, but the problem is all the work is aimed at tourists. People who live here would like their children to stay in the district, but that has become impossible," said Maria de Lurdes Pinheiro, who heads the Alfama Heritage and Population Association.

Monetary policy and fiscal policy under a system of fixed output

Initially, monetary policy and fiscal policy were introduced in an economy where changes in these policies would affect output. In reality, there is no real link between monetary policy and real variables. That is, changes in monetary policy and fiscal policy cannot affect the total level of output because the total level of output is determined by the factors of production and not by monetary variables. This is called the neutrality of money.

What really happens, then, when the Fed and the government use monetary policy and fiscal policy? If we recall the equation for output of Y = C(Y - T) + I + G + NX we can begin this analysis. Given that Y is fixed by the factors of production, a change in G or T--that is, fiscal policy--must result in a change in another variable to maintain a constant Y. This change in Y works directly though the interest rate.

Each of the variables in the output equation is tied to the interest rate. Consumption tends to fall as the interest rate rises because the incentive for saving increases. Investment tends to fall as the interest rate rises because the cost of borrowing money increases. Government spending is not really affected by the interest rate. Net exports tend to rise as interest rates rise because domestic investment is relatively more attractive to both domestic and foreign investors.

When monetary policy and fiscal policy are used the interest rate is affected. Expansionary monetary policy directly lowers the interest rate by making money easier and cheaper to obtain. Contractionary monetary policy directly raises the interest rate by making money harder and more expensive to obtain. Expansionary fiscal policy increases the interest rate by decreasing the savings rate through lower taxes and higher government spending. Contractionary fiscal policy decreases the interest rate by increasing the savings rate through higher taxes and lower government spending. Thus, monetary policy and fiscal policy both directly affect consumption, investment, and net exports through the interest rate.

For example, say the Fed uses expansionary monetary policy such as purchasing government bonds, decreasing the reserve requirement, or decreasing the federal funds interest rate. This causes the interest rate to fall, which then causes consumption to rise and investment to rise. But, in order for the total level of output to remain fixed, net exports must fall the same amount that consumption and investment rise. In this way, total output does not change from monetary policy, but the division of total output is affected.

Another example is needed. Say the Fed uses contractionary monetary policy such as selling government bonds, increasing the reserve requirement, or increasing the federal funds rate. This causes the interest rate to rise which causes consumption to fall and investment to fall. But, in order for the total level of output to remain fixed, net exports must rise by the same amount that consumption and investment fall. In this way, total output does not change from monetary policy, but the division of total output is affected.

Debt levels depend on fiscal and monetary policy mix: Poloz

Poloz says more government spending and higher interest rates lead to lower private-sector debt—and higher public debt

The Canadian Press

June 4, 2016

OTTAWA – Private and public debt loads are closely influenced by the mixture of how much the government spends and the level of monetary policy, such as the key interest rate, Bank of Canada governor Stephen Poloz said Saturday.

In prepared remarks of his lecture at the University of Ottawa, Poloz said the optimal combination of monetary and fiscal approaches varies depending on the economic situation.

His lecture came as many countries around the world adjust their fiscal and monetary policy mixes in the hope of boosting stagnant economic growth.

The Trudeau government has shifted gears in recent months to seek deficit-fuelled growth by committing billions more dollars toward economy-enhancing investments such as infrastructure.

In his lecture, Poloz said a Bank of Canada model shows the combination of more government spending and higher interest rates leads to lower private-sector debt and higher public debt.

If the policy levels are reversed then private debt would climb and government debt would slide, he added.

“In effect, for a given macroeconomic situation, policy-makers have the ability to choose the dynamics of those two debt stocks,” Poloz said.

“They can’t influence the two debt stocks independently, but their policy choices have simultaneous implications for both variables.”

Poloz stressed that finding the right balance is complex for policy-makers since high levels of private and public debt can both create financial stability concerns in an economy.

“As for the desirability of one policy mix over another, hindsight is always 20-20 and such a discussion would have little meaning here,” he added.