World Bank President Praises Brazil's Moves on Economy, Efforts to Ease Poverty

World Bank President Paul Wolfowitz on Thursday praised Brazil for putting Latin America's largest country on a path toward slow, sustainable growth while trying to help tens of millions of people immersed in misery, reports The Associated Press.

           
After meeting with President Luiz Inacio Lula da Silva in the Brazilian capital, Brasilia, Wolfowitz said Brazil is "making real advances to stabilize its economy through fiscal control, which is generating big benefits for many, including the poor." Wolfowitz also met with Finance Minister Antonio Palocci, who has orchestrated Brazil's attempt to put its financial house in order through orthodox monetary policy.

           
Reuters writes that Brazil is the World Bank's largest borrower among middle-income countries. The Bank is keen to show the success of $5.6 billion in current investments for projects in Brazil ranging from Amazon rainforest protection to city sewers. Wolfowitz described Brazil as an "economic giant, a major global and regional actor" that had to use its economic success to lift millions of its people out of extreme poverty. Brazil is second only to South Africa in a worldwide ranking of income inequality. Over a quarter of the country's 173 million population lives on less than $2 a day, while 13 percent lives on less than $1 a day, according to the World Bank. Wolfowitz said Brazil had achieved the right balance between economic stability and spending on poverty reduction programs.

           
Agence France Presse notes that Wolfowitz praised the leading role of Brazil in reclamations against agricultural subsidies of rich countries, which are currently under discussion in Hong Kong. Wolfowitz, meeting with Lula, stated his high “regard for the solid leadership of Brazil in the international trade agenda, and its demands for a greater liberalization of agriculture in developing countries.” He also pointed out that “Brazil is an industrial and technological leader whose products, from soy beans to aircrafts, are widely exported. Fair trade is key for development and poverty reduction.” The official expressed his belief that decreasing agricultural subsidies would help fighting poverty worldwide.

           
Dow Jones reports that in addition to improving trade and promoting sustainable development to reduce poverty, Wolfowitz said environmentally sound resource management was also a special concern for the World Bank. When questioned by members of the local press regarding the matter of corruption, Wolfowitz said that less developed countries needed to improve their mechanisms to combat the problem. "Corruption is a problem for all countries," he said. "It is particularly a problem in the poorest countries in the world because they don't have institutions to deal with it. And it is one of the reasons countries stay poor." Wolfowitz said that to combat corruption, countries needed "democratic accountability, a free press and a good judicial system." Regarding the latter, he suggested Brazil could use some improvements. "It's an area where Brazil is ahead of many countries, but it has more work to do," he said.     

           
EFE News Service further writes that Wolfowitz visited a Sao Paulo shantytown to check out how the waste water treatment and sewer program financed by the World Bank and the Brazilian government has impacted the lives of local residents. One Kogohara resident told Wolfowitz how authorities had paved some of the favela's streets and improved the drinking water supply. Another, retiree Xose Osvaldo de Xesus, told the World Bank President that, "Things have gotten better," but the problem now that electric lighting is regularly available is the lack of jobs. "What has to improve now is the employment" situation, he said, adding that he and his wife have 12 children, but none of them work at anything more secure than precarious part-time employment.

           
The Associated Press also notes that Wolfowitz is on a six-day trip and he will also travel to the Amazon region and to Brazil's impoverished northeast, where President Lula was born, the son of a very poor farmer before immigrating to Sao Paulo, the nation's industrial and financial hub.

The visit of President Wolfowitz to Brazil was further reported by  AE- Brazil, Gazeta Mercantil (Portuguese) ,  Panorama Brasil (Portuguese), Folha de São Paulo (Portuguese), Agencia EFE - Servicio General (Spanish),  Valor Econômico (Portuguese), AP Spanish Worldstream, Reuters Focus (Portuguese), Agencia Mexicana de Noticias, NOTIMEX (Spanish), Agence France Presse (Spanish), Gazeta Mercantil News (Tempo Real, Portuguese).

WTO Negotiators Reach Deal Granting Duty-Free, Quota-Free Access To Least Developed Countries

Negotiators at a World Trade Organization meeting reached an agreement Friday on granting duty-free and quota-free access to imports from so-called least developing countries, Indian and Indonesian officials said, reports The Associated Press.

           
In talks that began late Thursday and spilled over to Friday morning, key negotiators were able to agree on a text that addressed both the demands of the poor countries and also the concerns raised by the United States and Japan, an Indian official said, requesting anonymity because an official announcement was due later. Rich countries as well as leading developing countries like Brazil, India and China have agreed to provide duty free access on "a lasting basis," he said reading out from a copy of the text. Among the 149 WTO members, 32 fall into the category of least developed, with per capita incomes of less than $750.

           
The agreement came after negotiators from least developed countries dropped their demand that all of their products should be allowed duty-free access, the Indian official said. In return, negotiators from the US and Japan agreed to limit the exemptions to a fixed percent that will be worked out later. Such exemptions would be transitory and would end by a set date, he said. According to the text of the agreement, developing economies like India, Brazil and China will be allowed more flexibility than the rich nations.

           
Dow Jones meanwhile writes that developing countries are prepared to accept a US proposal to eliminate export subsidies on its farm products by 2010, though the question of defining subsidies still remains unresolved, India's Commerce and Industry Minister said Friday. Kamal Nath said differences over the definition of export subsidies - which include the issue of whether food aid constitutes a form of support - could be discussed further, but an agreement on a date of full elimination was more important. The US had, in October, offered to eliminate export subsidies on its farm products by 2010 and to cut by 60 percent the amount of domestic support it provides farmers over the next five years. However, developing nations led by the G20 are demanding that the US cut all trade-distorting subsidies by 75 percent, including in exemptions now allowed under WTO laws. 

           
The Wall Street Journal Asia notes that some poorer nations within the WTO Thursday dug in their heels against a push by industrialized countries to open service sectors to foreign competition. While agriculture has taken much of the spotlight during talks here on a new global trade treaty, developing countries remain concerned that a final deal will force them to open their banking, utilities, telecommunications and other service sectors. The business daily writes that led by the least-developed countries and some African, Caribbean and Pacific nations, delegates want to rewrite the services provisions of a draft ministerial statement set to be approved Sunday by WTO members.

           
The Guardian (UK) adds that the row over services came as the United States sought to defuse anger over its refusal to accept duty- and quota-free access for all products from all LDCs. The US trade representative, Rob Portman, said America was prepared to accept a compromise in which all countries were involved but where certain sensitive products - such as textiles - were left out.

           
Dow Jones reports that cotton, banana and sugar growing nations in Africa, the Caribbean and Pacific regions threatened Friday to reject any global trade deal that eliminates safeguards for their farmers or their preferential access to European markets. The Group of 77 African, Caribbean and Pacific countries, many of whose populations are subsistence farmers, was emphatic in its refusal to sign onto any WTO deal at talks in Hong Kong that would imperil protections for commodity growers. "We will not be a party to any consensus that that does not recognize our right to grow bananas," said Charles Savarin, trade minister of Dominica. "We must preserve our traditional access to the EU markets."

           
AFX Asia further adds the African Cotton Producers' Association dismissed the US' announcement that it is prepared to allow West African nations duty-free access to its cotton market, saying that it "will change nothing". The latest US proposal "will change nothing," said Francois Traore, head of the African Cotton Producers' Association. "The Americans have to go further than that." Added Niger's minister of trade and industry, Mamadou Salissou Habi: "We know with certainty that it's the US subsidies that are causing problems for our farmers."

           
Agence France Presse also notes that the United States is ducking the real issue as the debate over its cotton subsidies and the harm they are said to do to African farmers heats up at WTO talks, critics say. According to the World Bank, cotton subsidies cost African producers $150 million a year. Washington questions the real impact its subsidies have on cotton prices, pointing to studies showing that eliminating them could lift prices by only two to 12 percent. Opponents claim Washington is failing to live up to a promise it made in an interim WTO deal in 2004, which said cotton would be treated "ambitiously, expeditiously and specifically."

           
The Straits Times (Singapore), Frankfurter Rundschau (Germany), The Guardian Unlimited (UK), The Irish Independent, and The Irish Examiner notes that the World Bank Thursday stepped up the pressure on bigger wealthy nations, warning that “there has been too much talk and too little action” over their pledge to help developing countries through freeing up trade. Speaking at the WTO meeting in Hong Kong, World Bank vice-president Danny Leipziger told journalists that the trade talks so far have “disappointed” the bank. “In the first three days the meetings have taken, the rich countries have transferred more than $2 billion to their farmers in various forms of support,” said the official, who is heading the World Bank delegation. “In the same period, the 300 million poorest people in Africa have earned less than $1 billion between them,” he said. Forgiving debt and increasing aid help, but they are not the answer in the absence of new markets and new jobs, said Leipziger, who also heads the World Bank's 900-strong poverty reduction and economic management division.

           
The Australian adds the World Bank added its voice to the indignation expressed by the least developed countries over their treatment at the WTO summit in Hong Kong, saying there had been much talk about development but little action. "The major trading economies of the developed world are keeping the big issues off the table, and as long as that happens, the poor will suffer," Danny Leipziger said.

           
Xinhua meanwhile notes that the Hong Kong session of the Parliamentary Conference on the WTO ended on Thursday with a declaration urging all the WTO members to advance the Doha Round trade talks. "Open, free, fair and growing trade reduces poverty and brings benefits to developing countries," said the declaration issued after the Dec. 12-15 meeting. It called on leaders, ministers and negotiators of the WTO members to "show vision and leadership and pledge full support for the multilateral trading system." The least-developed countries should be granted with the duty-free and quote-free market access and the recently acceded members be given special and differential treatment at the Doha Round talks, said the declaration.

           
The Associated Press finally reports that the WTO approved Tonga's bid to become the 150th member of the global body. The South Pacific nation will officially become a member early next year.

Argentina to Repay All IMF Debt, Following Brazil

Argentina said Thursday it will repay its entire debt to the International Monetary Fund (IMF) from its currency reserves, in a sign of the country's rebound from economic collapse four years ago, reports Agence France Presse.

           
Argentine President Nestor Kirchner said the debt to be repaid before the end of the year amounts to $9.81 billion. The announcement came two days after a similar move was announced by Brazil. Kirchner told a press conference the payment would come from Argentina's currency reserves estimated to be over $26 billion. He noted that Argentina had already repaid about $6 billion to the IMF since the economic crisis began in late 2001.

           
Telam News Agency (Argentina) writes that the President made the dramatic announcement in the White Room of the Government Palace, which was filled with businesspeople and political and social leaders who had been invited there early on, amid extraordinary expectation, for "an important meeting." The initial surprise among the audience notwithstanding, everyone recalled that months ago the government had decided that one of its priorities would be to see to it that the country stopped being "permanently audited" by the IMF so that it could thus determine its own policies. This is a "momentous step" that will allow the country to operate "with autonomy" and "free from pressure" so that it can decide on the "tools for the struggle for growth," Kirchner said with particular emphasis.

           
The BBC notes that Argentine relations with the IMF have been difficult since the country's government defaulted on a debt of over $100 billion four years ago. Millions of dollars were taken out of the country and many of Argentina's large middle class found themselves knocking on the ramshackle doors of the country's growing shanty towns. Tens of thousands of others left to start new lives abroad. But, against the odds, Kirchner has turned things around. The economy is growing at an impressive rate and, speaking after the president, new Economy Minister Felisa Miceli said exports were at a record high. The economic future certainly looks brighter than it did just a few years ago but it will still be some time before the benefits of this move filter down to the many Argentines living below the poverty line and to those still reeling from the crisis four years ago.

           
The Associated Press reports that in Washington, IMF chief Rodrigo Rato said he “welcome[s] Argentina's repayment of its outstanding obligations to the Fund. Important challenges and opportunities lie ahead for Argentina, and the Fund looks forward to maintaining a productive relationship with the authorities.” “We remain ready to assist the Argentine authorities in any way that would help them address these challenges,” he added, without elaborating on what the challenges were.

           
The Financial Times writes that while the IMF is likely to be pleased to get its money back, and to end the stand-off with Argentina, the repayment by two large borrowers raises fresh questions about how the Fund will pay for its operations at a time of low demand for its loans. Argentina’s foreign reserves rose to almost $27 billion from a low of about $8 billion shortly after the country suffered its worst economic crisis in December 2001. Paying off the Fund in short order will leave Argentina with fewer reserves and potentially more vulnerable to swings in international investor sentiment.

          
Xinhua (China) notes that the deal will be completed by the end of this year, two years ahead of schedule, saving Argentina $1 billion in interest, Kirchner said. Argentina is the third largest debtor of the IMF, following Brazil and Turkey. However, it started to emerge from its debt problems slowly. In June, the country managed to renegotiate $100 billion in private debt with more than 70 percent of its creditors.

           
In other developments, Dow Jones and Reuters further report that the World Bank has agreed to provide two loans totaling $190 million to the Argentine government for projects aimed at improving rural education and reforming provincial governments, the international lender said Thursday. The rural education loan is for $150 million, while the provincial government one is for $40 million. The education project aims to better train teachers, provide school supplies, and improve school buildings, while the other project aims to help provincial governments more effectively manage resources and improve the quality of administrative services, the World Bank said.

           
Reuters also writes that the economies of Latin America and the Caribbean will expand 4.3 percent this year, in line with projections in August and below 5.8 percent growth last year, a regional United Nations economic body said on Thursday. The Economic Commission for Latin America and the Caribbean, or ECLAC, lowered its growth estimates for the region's largest economies, Mexico and Brazil, and raised them for Argentina. Last year the region registered its strongest growth since 1980, largely reflecting strong demand in Asia for its raw materials.

ADB Approves $1.33 Billion, World Bank $400 Million for Pakistan Quake Reconstruction

The Asian Development Bank said Friday it has approved $1.33 billion in grants and loans for Pakistan to rebuild quake-hit areas, while the World Bank separately released $400 million, reports The Associated Press.

           
The ADB package includes $300 million in grants for reconstruction of areas in northwestern Pakistan and Pakistan-administered Kashmir worst hit by the Oct. 8 quake, the bank said a statement. The assistance includes a $1 billion pledge it made in November at a donors' conference in Islamabad. The World Bank said the $400 million emergency recovery credit is part of $1 billion it promised for earthquake recovery. "This credit will allow people to put their lives and homes back together," said John Wall, the World Bank representative for Pakistan. The two institutions have estimated the overall cost from the quake at around $5.2 billion, including relief operations, livelihood support for victims and reconstruction.

           
Bloomberg explains that of the World Bank’s emergency credit, a total of $220 million will help rebuild homes, while the rest will be spent on other reconstruction efforts, including roads, water supply and other infrastructure. “In addition to the enormous human toll, the cost of the earthquake and its aftermath will present Pakistan with an enormous financial challenge,” the World Bank said in the statement, estimating earthquake-related costs at $5.2 billion. The funding is crucial as hundreds of thousands of people still lack the shelter they need to survive the winter that lasts from November until March in the part of Kashmir controlled by Pakistan and the North West Frontier province.

           
Agence France Presse further reports that by far the largest component of the total ADB aid package is a multi-tranche financing facility (MFF) of up to $770 million and a related $3 million loan to upgrade the country's highway network. "The MFF structure, the first to be used in ADB's operations and in Pakistan, was deemed most appropriate to meet the government's long-term needs, as it provides a flexible facility that combines large-scale financing with promotion of reforms and adherence to safeguard and oversight requirements," said ADB transport specialist Allan Lee.

           
The Business Recorder (Pakistan) meanwhile writes that another ADB program component, the Earthquake Emergency Assistance Project, features a quick disbursing mechanism amounting to $108 million to finance import of materials urgently needed for the recovery process. The project additionally addresses needs of vulnerable groups, including women and children, and assists affected people by supporting the reissue of lost documentation as well as protecting their legal rights. Work planned includes rehabilitation of earthquake-damaged major roads and bridges; repair of hydropower generating stations and construction of new lines and facilities; and reconstruction of health and education facilities in affected districts.

           
Dow Jones also notes that this week, the UN said that it needs an additional $45 million to provide survivors with thick blankets and shelter materials. On Thursday, Sardar Sikandar Hayat, the top elected official in Kashmir, urged the world community to generously help Pakistan. "We are grateful to the international community for helping us, but we need continued support for relief and reconstruction work," he said. Also on Thursday, UN Secretary-General Kofi Annan appointed former US President George H.W. Bush as his special envoy for rehabilitation and reconstruction in quake-stricken Pakistan.

           
In related news, BBC News reports the UN General Assembly has approved a new $500 million emergency fund to provide instant aid to people hit by major disasters. The Emergency Response Fund aims to reduce the need for appeals every time a crisis unfolds. It will be launched in January and be running by March. Correspondents say there is powerful political support for the idea, but some charities fear being overlooked. They argue that money from the fund might go first to UN agencies and could make it more difficult for non-governmental organizations to get cash. But those in favor - including the British-based aid agency Oxfam - say the key thing about having a big standing fund rather than making flash appeals for every crisis is that the world would be able to respond more quickly.

Microcredit And Disasters

The very idea of using microcredit for relief work seems almost heretical to some purists, for whom the whole point of microfinance is that it is not charity, but a self-sustaining means of helping people start or expand a small business. If micro-lenders start dabbling in disaster relief, they send confusing signals about their real business, argues The Economist.

           
Yet Syed Hashemi, of the Consultative Group to Assist the Poor, a microfinance consultancy, told a conference in Delhi last week that many donors and aid agencies assumed microcredit was “the answer” to the problems left by the tsunami in the places it shattered, such as Aceh, on the Indonesian island of Sumatra. He says that lenders, who may themselves be badly hit by a disaster, are best advised to limit their involvement in relief work. Similarly, governments and donors should avoid muddling aid and credit by offering cheap loans. If people have lost everything, they probably need to be given money, not lent it. “To disguise this through a subsidized loan undermines the whole operation.” After grants, a phase of cash-for-work (on reconstruction, say) is often needed before microcredit comes into play.

          
Not many microfinance institutions offer the services that people need most after a catastrophe: insurance, and access to their savings and to remittances from their families and friends. However, there is also a demand for income-generating assets—fishing-nets, tools, bicycles, stocks for a small shop, and so on—and hence for microcredit to finance them.

           
In the remote parts of Pakistan worst hit by the recent earthquake, where 300,000 people have been affected, there are fewer than 10,000 “active” microfinance loans. Yet in tsunami-hit Sri Lanka, where there was a large existing microcredit network, it has played a big if controversial role. The government and foreign donors have been lending at a concessional rate of just 3 percent a year to banks and microfinance institutions, which have been lending on at 6 percent.

           
Alessandro Pio, in Sri Lanka for the Asian Development Bank, which has helped finance this, concedes it is not a perfect solution. It is, though, a good way of reaching the fishermen, stall-holders and others who need small business loans. For a lender wanting to help, there is little choice but to match the existing subsidies. But it is hard for subsidized lenders to revert to lending on commercial terms; and because the banks and microfinance institutions are taking all the credit risk, most of the money flows to known customers.

           
Even what look like post-disaster success stories are ambiguous. Vijayalakshmi Das, of Friends of Women's World Banking, an outfit based in the Indian state of Gujarat, describes how, after a terrible earthquake there in 2001, it lent about 10 million rupees ($210,000) to farmers. The loans, of about 100,000 rupees, 20 times the Friends' normal credits, financed water-pumps, seeds and tools and were all paid back within a year. But the group's mandate is to help women and poor households. Lending to farmers was a job that banks should have done. Friends could help because it was quick and flexible, and active in the area. This should be the great strength of microfinance institutions. One lesson of the year of disaster relief is about the limits to what microfinance can achieve. But a more important one is the need for more of it.

Also In This Edition: Also Reports and Briefly Noted....

Also Reports…Australian Broadcasting Corporation (ABC) News note that a World Bank report on the cost of doing business [“Doing Business in 2006”] in the Pacific says it can take more than a year to enforce a contract in Solomon Islands. The World Bank figures reveal that it takes an average of 455 days to enforce a contract in the Solomons, compared with 240 in what is regarded as good practice in rest of the Pacific and only 27 days in what is regarded as good practice globally.

           
Tim Harford, and a columnist for The Financial Times, also quotes the Doing Business 2006 report in a column in Friday’s The New York Times. He writes that sub-Saharan African exporters face, on average, delays of nearly 50 days for each shipment. They must get roughly 20 signatures on eight or nine separate customs forms.

           
Briefly Noted…Reuters reports the UN Security Council voted unanimously on Thursday for a ban on diamond exports from the Ivory Coast to stop rebels in the war-divided nation from using gems to purchase arms. In a resolution linking illegal trading of Ivory Coast diamonds with the proliferation and trafficking of guns in the West African nation, the resolution also renewed sanctions against individuals interfering in the peace process.

           
BBC News notes the head of United Nations peacekeepers has warned of a "crisis" in the Horn of Africa, as UN troops started to leave Eritrea after being ordered out. Almost 90 western troops are leaving Eritrea. Jean-Marie Guehenno said he had never experienced a similar situation in 10 years in the job. He has been in Eritrea since Monday in a bid to solve the problems but was not able to meet President Isaias Afewerki. Ethiopia and Eritrea have both moved troops towards their border recently.

           
The Associated Press reports the EU on Thursday gave an additional EUR20 million to help victims of last year's Indian Ocean tsunami, saying it would meet other major donors next week to take stock of the disaster which killed more than 176,000 people. EU officials will meet representatives from the United Nations, the World Bank and aid organizations, including the International Red Cross, on Tuesday to examine the disaster response so far and set out the next steps. Representatives from the countries worst affected by the tsunami will also be present.

           
Reuters further reports the World Bank's International Development Association (IDA) will provide a $200 million development support credit to Bangladesh, a World Bank statement said. It said an agreement was signed on Thursday between Bangladesh and the IDA, which offers low-cost loans and grants to poor countries.

           
Reuters also notes China will abolish tariffs it slapped on textile exports earlier this year from January, Finance Minister Jin Renqing said in remarks published on Friday. All remaining export tariffs on Chinese textile products will be cancelled from the first day of 2006, the China Securities Journal quoted Jin as saying.

           
Xinhua further reports that China has officially moved from being an international aid recipient to become a donor nation now that it no longer requires assistance from the United Nations' World Food Program (WFP). At a news briefing on December 15, James Morris, WFP executive director attributed the end of the food aid program in China to the "Chinese government's tremendous success in alleviating hunger".

           
AFX Asia reports the World Bank said its board has approved a $100 million loan to improve transport infrastructure in southeast China's Fujian province. In a statement, the World Bank said the loan will fund public transport and road development projects in Fuzhou City, the province's capital, and Nantai Island. The loan for the Fuzhou Nantai Urban Development Project has a maturity of 20 years, including a five year grace period, the World Bank added.

           
Reuters notes China will revise up the size of its economy in 2004 by 16.8 percent next week, a government source said on Friday, a move that could catapult China from the world's seventh-largest economy into fourth spot. Hong Kong's South China Morning Post, citing unnamed economists, reported on Tuesday that the NBS would probably revise GDP by as much as $300 billion, or about 20 percent of 2004 output.

           
The Guardian (UK) reports Iraqis of all ethnic groups turned out in large numbers yesterday to elect a four-year parliament with the encouragement of local insurgents in at least one big Sunni city. Early estimates suggested more than 70 percent of the 15 million voters turned out, with participation strong in Sunni areas that have previously shunned the nascent democratic process. Results are expected to take two weeks to collate. .

           
Reuters notes the World Bank on Thursday approved a lending program for Lebanon to help the country meet economic challenges as it transitions from three decades of Syrian domination. The bank's Country Assistance Strategy (CAS) proposes lending Lebanon from $100 million to $700 million between 2006and 2009 depending on Beirut's ability to carry out fiscal and structural reforms, the World Bank said in a statement. The World Bank's board of directors expressed support for Lebanon and emphasized the importance of implementing structural reforms.
           
Capital Weekly (Bulgaria) writes that Bulgaria should pay more attention to the financial stability of the healthcare system, the focus should move on out-of-hospital treatment and prevention, rather than on hospitals, which on the other hand should be restructured, World Bank resident representative for Bulgaria Oscar de Bruyn Kops said at the conference Future of Healthcare Policy - from Informed Consent to Informed Choice. Kops also advised reduction of the expense for medicines and easier access of the vulnerable groups to healthcare. According to Kops the problem is not the low budget for healthcare, but its inefficient spending.

           
The Moscow Times writes an ex-minister and a former director of Sheremetyevo Airport are teaming up to launch an air taxi service next year, potentially servicing hundreds of cities currently without an air link. The new venture -- which is seeking financial backing from the World Bank -- plans to offer flights for roughly 15 rubles (50 cents) per kilometer, equal to Moscow taxi rates. To help offset costs, Avia Management is in talks with the International Finance Corp. over a $15 million loan. Milana Gorshkova, an investment officer at IFC's infrastructure group in Moscow, confirmed the progress of negotiations and the volume of the proposed loan. "We are interested in this project, and we know its sponsors very well," she said, praising its potential benefit to the country's aviation industry and consumers.

           
Reuters reports Russia's President Vladimir Putin pledged support for foreign banks operating in Russia on Thursday, calming market worries after his remarks on Wednesday calling for a ban on foreign banks’ activities. "We will support not only our local businessmen working in the banking sector but also foreign capital that comes to us," Putin said on Thursday. Speaking at a banking conference in Siberia on Wednesday Putin said the activity of branches of foreign banks operating in Russia should be banned. Under Russian law, foreign banks are not allowed to open branches, though a number of such banks including ABN AMRO, ING, Raiffeisen and Citigroup operate Russian-registered subsidiaries.