Saturday, May 16, 2009

Venezuela seizes US pasta company


Venezuelan officials accompanied by soldiers have seized "temporary" control of a US-owned pasta producer.

Venezuela says the plant, owned by the big US firm Cargill, had violated regulations on price controls intended to guarantee cheap food for the poor.

The move further increases President Hugo Chavez's hold on the economy, after a series of recent take-overs of private and foreign-owned businesses.

They include a Cargill rice plant, and services companies in the oil industry.

Deputy Food Minister Rafael Coronado said the government would run the factory for 90 days, and would reassess the situation after that.

He said it has not been producing sufficient quantities of a type of pasta sold at cheap, government-established prices.

Price control

A rice mill owned by Cargill was taken over earlier this year, on the grounds that it was not producing rice at government-set prices.

Cargill had said it did not break the government's pricing rules on rice because the mill did not produce the plain rice which is regulated.

Venezuela has set quotas and prices for 12 basic foods including rice, powdered milk, cheese and tomato sauce.

Under the measure, 80% of all rice produced must be basic white rice. The measure also includes 95% of all cooking oil, coffee and sugar.

Last week Mr Chavez sent troops to take over oil service companies including hundreds of supply boats, and two American owned gas facilities.

He nationalised Venezuela's oil reserves, one of the largest in the Americas, two years ago.

GM to close up to 1,100 dealers


General Motors (GM) has announced plans to close up to 1,100 of its dealerships in the US as it desperately tries to cut costs and stave off bankruptcy.

It also plans to cut ties with another 470 Saturn, Hummer and Saab dealers.

Closures announced today represent one quarter of the dealership network. GM plans to cut the total number of dealers by 42% by the end of 2010.

On Thursday, rival Chrysler said it would be closing 789 US dealers as part of a massive restructuring programme. GM is also in negotiations with unions to reduce wage costs.

Oil prices fall towards USD 58


Oil prices fell towards USD 58 on Friday as news of a deepening recession for Europe further dampened hopes of a quick rebound in energy demand, analysts said.

New York's main futures contract, light sweet crude for delivery in June, dropped 27 cents to USD 58.35 a barrel after rising earlier on Friday in line with firmer stock markets.



Brent North Sea crude for July delivery shed 52 cents to USD 58.07. The June contract expired yesterday priced at USD 56.69.



"Markets were a little lower ... after data from Europe disappointed," said Nimit Khamar, energy analyst at Sucden brokers in London.



The 16 nation eurozone economy contracted a record 2.5 per cent in the first quarter as Europe lurched deeper into recession while Germany suffered its biggest blow for 40 years.



Accounting for a third of eurozone output, Germany contracted 3.8 per cent in the first three months compared to the final quarter of 2008, when the economy shrank 2.2 per cent, the statistics office said.



France, Germany's main partner and the second-biggest eurozone economy, meanwhile entered recession as output fell 1.2 per cent after a 1.5 per cent drop in the last quarter of 2008.

Economy at the time of COVID

The COVID-19 pandemic has spread with alarming speed, infecting millions and bringing economic activity to a near-standstill as countries im...