IT Blues

Britain’s Marconi suffered the same fate couple of weeks back. Soon it was Sony of Japan. And now, Brokat of Germany has reported the same results. All these global giants in related fields have incurred heavy losses in the recent months.

Brokat that makes e-business software reported $726 million net loss in the second quarter of the year 2001, which is 40 times greater than the losses posted in the same quarter last year. Brokat attributes the mounting losses to heavy writedowns for US software companies, Blaze software and GenStone Systems, which it bought last year.

These reports coincide with IDC’s report that PC shipments globally slumped 2% in the second quarter of 2001. And the effect of US slowdown was visible not only in China and India, the two main growth areas for PC market is Asia, but also in Australia, South Korea and Japan.

Meanwhile, India’s Economic Times has reported that NIIT, one of the major software & training companies of India, has reduced its work force by 6% as on June 30, 2001.

B’desh to Challenge TI

Soon after transparency International (TI) issued the findings of Corruption Perception Index (CPI) of this year, the government of Bangladesh is reported to be preparing to take legal action against the global anti-corruption watchdog institution.

TI’s index has ranked Bangladesh the most corrupt country in the world followed by Nigeria, Uganda and Indonesia.

Scandinavian countries, New Zealand, Singapore, Canada and Netherlands are reported to be the least corrupt according to the perception of international banks, risk analysts and business persons. The index covers the 91 countries that attract foreign investment.

Finland was ranked the best meaning least corrupt with the score 9.9 in a 0-10 scale. India is ranked 71 with a score of 2.7 and china 57 (3.5) while Bangladesh scored 0.4.

The TI index is said to be based on various international surveys including those of the World Bank and relates to two-year old situation with the changes of the latest year not reflected in this year’s index.

Vietnam Eases Exports

Vietnam is reported to have cancelled all export-related fees in a move to boost sagging exports.

All fees - such as licensing fees, export quota-related fees, customs charges and certificate of origin charges - will not be levied until the end of June 2002.

By reducing exporters’ operating costs, the move is expected to boost exports.

Vietnam’s economy is largely export-driven and has suffered from the slowdown in global demand. The government is trying to boost export revenues by reducing export quota controls and making it easier for companies to access foreign exchange.

The government has also cut import taxes on fertilizers and pesticides in a move aimed at reducing farming costs and increasing the competitiveness of Vietnamese agricultural exports.

Thai Move for Privatization

Thailand’s Cabinet has approved a draft bill to establish a holding company for state enterprises, to facilitate a planned wave of privatization, say reports.

A total of 18 state enterprises are slated for privatization by the end of 2002 and are expected to generate 300 billion baht (dlrs 6.7 billion) for the government.

The State Investment Corp is to handle the government’s holdings in all state enterprises.

The draft bill is to be reviewed by the State Council before submitting to parliament for approval in August. The corporation should be established by the end of the year, it is expected.

The Petroleum Authority of Thailand is expected to be the government’s flagship for privatization. The state agency plans to sell a 20 percent to 30 percent stake by the end of this year. The Cabinet has also approved a restructuring plan for the national carrier Thai Airways International, seen as a preliminary for privatization, also due for completion by the end of the year.

Under the existing privatization plan, the government will lower its stake in the airline to 70 percent from 93 percent.

The airline, once the pride of Thailand, has been stung by recent criticism of its management and the big perks offered to board members and their relatives.

Compiled by New Business Age Desk

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