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Business in Asia Today


Seoul shelves law to allow chaebol to own banks
SEOUL - The South Korean government has again shelved the ideaof changing the banking law to allow for the private ownershipof banks, according to a ranking finance ministry officialwho declined to be named. Seoul put off the issue of bankownership last year, saying it would deal with the matter thisyear. The government now feels, however, that revising thebanking law may interfere with the restructuring ofconglomerates, known as chaebol. "If weallow chaebol bank ownership, they may place greater priorityon purchasing banks than restructuring, and possibly delay ourreform drive," the official said.

Toshiba projects $141m net loss
TOKYO - Toshiba Corp. (TSE:6502) has projected aconsolidated net loss of 17 billion yen ($141 million) inthe business year ending March, the first such loss sincefiscal 1975. It posted a group net profit of 7.3 billion yen($60.8 million) in fiscal 1997. The firm blamed the yen'ssurge against the dollar, sluggish corporate capital spendingand a temporary tax burden resulting from an expected changein the corporate tax rate. Consolidated sales are expected tofall 2% to 5.35 trillion yen, withoperating profit plunging 70% to 25 billion yen.

Jardine Pacific acquires Malaysian IT distributor
KUALA LUMPUR - Jardine Pacific, the trading and services arm of the Jardine Matheson Group, has acquired Automation & Computer Engineering Sdn Bhd (AutoComp) for an undisclosed sum.Jardine Pacific owns extensive IT distribution businesses in the region through JOS Technology Group (JOS), JOS said in a statement today.AutoComp is one of Malaysia's top information technology distributors. It has a network of about 2,000 computer dealers throughout the country and has operations in Kuala Lumpur, Penang and Kuching.

Hyundai Motor to merge with Hyundai Motor Service
SEOUL - South Korea's Hyundai Motor Co. (KSE:05380) said Monday that it will merge with Hyundai Motor Service (09650) as part of Hyundai Group's efforts to restructure its auto division.Shareholders of both companies are expected to make a decision on the merger Friday.

Aussie miner Eltin awarded U.S.$140m in new contracts
PERTH - Contract miner Eltin Ltd. said it had recentlyconcluded negotiations on A$220 million (U.S.$140.47 million) inthree new contracts. Managing director Nick Bowen said thatwith the award of these contracts, Eltin's order book stood atA$1 billion (U.S.$640 million). The largest of the new contractsis one awarded to a joint venture between Eltin and AusdrillLtd. by a subsidiary of Ashanti Goldfields Co. Ltd. for the GeitaGold Project in the north-west of Tanzania, East Africa.

Jakarta postpones telephone tariff rise
JAKARTA - The Indonesian government said it would ask thestate-owned PT Telkom to postpone a hike in telecommunicationrates, which become effective this month. Sasmito Dirdjo, thePost and Telecommuncations director general, said that strongpublic protests had forced the government to reconsider the 24percent increase in the telephone tariff. The Foundation ofthe Indonesian Consumer Institute (YLKI) has called for aboycott of telephone use if the government insisted onincreasing the tariff. The new tariff hikes followed tworises last year amounting to almost 20 percent.

Japan's NTT to spend $210m on increasing stake in Smart
TOKYO - Nippon Telegraph and Telephone Corp. (TSE:9432)will spend about $210 million to increase its stake in SmartCommunications Inc. of the Philippines to about 37 percentfrom the current 15 percent, company officials said. SmartCommunications is the nation's largest mobiletelecommunications company handling both domestic andinternational services. NTT's cumulative investment in thePhilippines firm since 1995 will total about $370 million,one of its biggest overseas projects.

Vietnamese minister calls for tax system overhaul
HANOI - Vietnam's Finance Minister Nguyen Sinh Hung hascalled for a major overhaul of the tax collection system. Oldtax policies which were no longer suitable should be amended,including taxes on property ownership or land-use rights, theVietnam Economic Times quoted him as saying. Taxes leviedon the registration of property ownership and the transfer ofland-use rights and contributions sought from poor localitiesshould be lowered, as should be the tax rates applicable tofinancially struggling enterprises. These measures wouldencourage people to abide by tax laws, thus improving taxcollection, Hung said.

Australian airlines oppose open skies policy
SYDNEY - Australia's major airlines remain opposed to opening the domestic market to international competition, claiming it would be detrimental to the industry and its customers in the long run.Ansett executive chairman Rod Eddington reiterated his airline's position that it would review loss-making regional services if foreign carriers were allowed to fly domestic routes.

Gajah Tunggal to restart shrimp farming with $114m
JAKARTA - Diversifed Indonesian business group GajahTunggal has said it will inject at least Rp1 trillion ($114million) in fresh funds to restart the operation of its shrimpponds in the Ogan Komering district in South Sumatra closedafter being damaged in 1998 riots. PT Wachyuni Mandira, thesubsidiary that operates the ponds, billed as the largest inAsia, said it suffered a loss of Rp300 billion ($34.1million) in damage and shrimp stolen by the rioters inNovember last year.

Malaysia's Aziz urges more barter trade
KUALA LUMPUR - Malaysia's International Trade and IndustryMinister Rafidah Aziz has urged the private sector to open upmore barter trade complexes at ports and commercial centers.She said although barter trade was not as important as ordinarytrade, barter had increased tremendously. "Thetotal value of barter trade in Malaysia has increased fromRM815.5 million ($214.6 million) in 1996 to RM1.216 billion($320 million) in 1997," she said. Among the countriesinvolved in barter trade with Malaysia are Indonesia, thePhilippines and Thailand.

(Asia Pulse)



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