A laborer cleans a gear inside a factory in Baokang, central ChinaÕs Hubei province.

SHANGHAI, China, July 15--China’s economy grew so rapidly in the first half of 2007 that it is likely to overtake Germany as the world’s third-largest by the end of this year, analysts say. The release Wednesday of January to June figures for Asia’s second biggest economy will provide fresh evidence that Beijing’s economic braking measures have had little effect.
China’s sizzling economy expanded even faster than originally thought last year, with the government revising 2006 growth domestic product (GDP) to 11.1 percent from 10.7 percent, AFP wrote.
Data released by China’s statistics bureau last week showed the economy was worth 21.09 trillion yuan in 2006, about $2.65 trillion based on last year’s average exchange rate of 7.97 yuan to the dollar.
The revision puts China in striking distance of Europe’s largest economy within months. “With this upward revision, it is highly likely that China will bypass Germany to become the third-largest economy in the world in current US dollar terms by the end of this year,“ said Hong Liang, an economist at Goldman Sachs.
According to the World Bank, Germany’s economy was worth $2.9 trillion at the end of 2006.
Economists expect GDP in the second quarter to near or equal its breathtaking January to March pace of 11.1 percent growth.
JPMorgan Chase Bank economist Wang Qian put the second-quarter acceleration at 10.6 percent, and said it would pick up speed in the second half of the year.
“We don’t see any sector of the economy slowing down. It’s firing on all cylinders,“ said Wang.
The torrid pace of development means that China’s economic czars will once again have to devise fresh ways to prevent the export powerhouse from the kind of overheating that could trigger a slide into financial crisis.
Regulators have already taken this year introduced a slew of piecemeal administrative measures to slow the economy, including two interest rate hikes, five increases in bank reserve requirements and new export curbs.
Exports, one of Beijing’s biggest headaches given the friction it causes with its two largest trade partners, the European Union and the United States, have continued to flood international markets.
The widening trade gap is on route to becoming the globe’s largest ever after Beijing announced last week that its surplus had jumped more than 85 percent in June to $26.91 billion.

ROME, July 15--Italy’s public debt, which is already the third highest in the world, hit a fresh record level in April, the Central Italy reported. The country’s debt swelled to 1,609.12 billion euros, according to Italian News Agency ANSA.
The report came in the wake of calls from the European Union that more be done to straighten Italy’s public accounts.
The Italian government sees Italy’s debt mountain falling to 105.1 percent of GDP this year compared to 106.8 percent last year and dropping below 100 percent by 2010.
The forecasts are contained in the center-left administration’s draft DPEF, a key four-year economic and budget planning document.
The DPEF forecasts a budget deficit of 2.5 percent this year, down from 4.4 percent in 2006.
The 2006 deficit was the highest in 10 years and meant that Italy had breached the European Union’s 3 percent deficit cap for four years running.
But the European Union has expressed concern over the DPEF, urging Italy to increase its efforts to consolidate public finances.
The International Monetary Fund has also criticized the DPEF as being “not in line“ with its recommendations and failing to provide “what Italy needs.“
It called for more money to be spent on cutting the deficit.
The Bank of Italy noted in its Thursday report that tax revenues were up 5 percent or 6.4 billion euros in the first five months of the year compared to the same period in 2006.

Picture taken 30 May 2007 shows a tanker filling at the oil terminal Rosneft company in Arkhangelsk, some 1,000 kilometers north of Moscow.

MOSCOW, July 15--State-controlled Rosneft, Russia’s biggest oil producer, doubled its assets this year and secured an advantageous 22-billion-dollar (16-billion-euro)-loan, Rosneft said in a statement.
“The company took out a 22-billion bridge loan at the lowest interest rate ever obtained by a Russian borrower. The company used the loan for activities at various producing, refining and marketing assets, the number of which increased from 102 to 230,“ the statement released Friday said, AFP reported.
The statement added that Rosneft now had assets in 45 of Russia’s regions, including newly acquired five large oil refineries and over 1,000 service stations.
Rosneft, once a relatively unknown state oil company, has risen rapidly to become Russia’s number one oil producer under company chairman Igor Sechin, the deputy head of the Kremlin administration.
Also, Russia is to sell off the major foreign assets of bankrupt oil group Yukos at auction in August with a starting price of just under $300 million, Russia’s Federal Property Fund announced Saturday. The company’s Dutch subsidiary Yukos Finance, which controls the assets, will be sold on August 15 with an opening price of 7.6 billion rubles (218 million euros), the fund said in a statement in the official Rossiiskaya Gazeta newspaper.
Assets owned by Yukos Finance include a 49 percent stake in Slovak Pipeline company Transpetrol, which transports 21 million tons of oil per year, Interfax news agency reported.
The sale is part of a series of auctions to help pay off over $26 billion of debts accrued by the company, most of it owed to the state.

Fuel-efficient and versatile, compact hatchbacks are the most popular vehicles in India's rapidly growing auto market.

SRIPERUMBUDUR, India, July 15--Cheap, fuel-efficient and versatile, compact hatchbacks are by far the most popular vehicles in India’s rapidly growing auto market. And as global automakers rush into the country to set up plants to make similar small cars, both established companies and newcomers see a bigger role for India: Asia’s small car export hub.
Already, South Korea’s Hyundai Motor Co. has shifted its entire production of the Atos Prime, its most popular compact, to the southern Indian town of Sriperumbudur, just outside the port of Chennai. It plans to do the same for
the Getz, a premium hatchback. A third of the cars produced at this plant are exported to 67 countries, from neighboring Sri Lanka to faraway Mexico, AP reported.
By October, Hyundai will complete a second factory nearby, doubling annual production to 600,000 cars, most of them compact hatchbacks that sell for about $7,000 (-5,080).
“We have a very clear target. India will be our export hub, which means all our small cars will be produced here,“ said Heung Soo Lheem, chief executive of Hyundai’s India operations.
Suzuki Motor Corp., which owns a controlling stake in Maruti Udyog Ltd., India’s largest carmaker, is investing $2 billion (-1.45 billion) in India and plans to export 200,000 cars from India by 2010, Chairman Osamu Suzuki said during a recent visit.
Homegrown Tata Motors Ltd. plans to make a $2,500 (-1,800) car, which could set new standards for the auto industry worldwide. The company is setting up showrooms across Africa and has tied up with Italy’s Fiat to use its South
American sales network.
Now newcomers like France’s Renault SA, which has rolled out its Logan sedan and hatchback here, are breaking into a market that for years has been dominated by Maruti, Hyundai and Tata.
Renault’s alliance partner Nissan Motor Co. has recently announced plans to make cars in India and export them to Europe.
Spurred by Tata’s ambitions for a super-cheap car, Nissan and Renault also are exploring the viability of a sub-$3,000 (-2,175) car in likely collaboration with Indian partner Mahindra & Mahindra Ltd. “This could have a big potential--bigger than India,“ Carlos Ghosn, CEO of both Nissan and Renault, said recently.

TOKYO, July 15--Participants in the International Thermonuclear Experimental Reactor project (ITER) will consider Kazakhstan’s offer to join the construction of a fusion power reactor in France, a Russian official said. The $10 billion project to build the reactor in Cadarache near Marseilles in southern France is designed to demonstrate the scientific and technological potential of nuclear fusion, amid concerns over growing demand for energy and the impact of conventional fossil fuels on the environment, RIA Novosti wrote.
“Kazakhstan has proposed receiving full membership in the organization comprising countries involved in the ITER project,“ said Sergei Mazurenko, the head of Russia’s Federal Agency for Science and Innovation. “The organization has decided to hold talks with Kazakhstan on the technical capabilities of its project participation,“ he said after a meeting of the ITER Council in the Japanese capital, Tokyo.
The results of the talks will be reviewed at the next meeting of the council November 27-28 in France.
Under an agreement signed in Paris on November 21, 2006, Russia, South Korea, China, Japan, India, the European Union, and the United States pledged to fund the construction of the first thermonuclear reactor, which is expected to be completed by 2016.
The European Union will cover 40 percent of the costs and the other participants will contribute 10 percent each.
“The key issue at present is to make sure that all member-countries ratify the ITER agreement and set up their national agencies because the project is entering the implementation stage,“ Mazurenko said. He said the Russian parliament had ratified the document and it only has to be signed by President Vladimir Putin to come into force. “I think it will happen in two weeks,“ the official said.
The ITER consortium currently has a staff of 123, including 13 Russian scientists, but the number of project employees will be increased by 100 personnel during this year, Mazurenko said.
According to the ITER consortium, fusion power offers the potential for “environmentally benign, widely applicable and essentially inexhaustible“ electricity, which the participants claim will be needed as the demand for alternative energy sources increases in the future.

BANGKOK, Thailand, July 15--The strengthening of Thailand’s currency, the baht, is expected to be short-term, Prime Minister Surayud Chulanont said in a television interview broadcast on Saturday. The premier also expressed confidence that the sharp strengthening of the baht will not have severe repercussions on the economy and ultimately cause another economic crisis, Xinhua wrote.
Surayud said although it poses negative impact on textile sectors, the baht appreciation has some benefits. “It allows us to buy petrol at cheaper prices“, he said.
Surayud also suggested investors to adopt sufficient economy principles and urged them not to buy the baht currency for speculation as that will put the economy in jeopardy.
The premier added that the government is trying its best to control political and economic problems so they will not cause problems to a new government.
Surayud has asked the Finance Ministry and Bank of Thailand to report baht activity every Friday, while Tuesday’s Cabinet meeting will discuss ways to handle the possible closure of export firms as a result of the strong currency.
The baht continued to rise reaching a new 10-year high on Friday at between 33.30 and 33.35 to the US dollar.
Finance Minister Chalongphob Sussangkarn said Friday that over the past two months 600 million US dollars had been invested in the stock market, causing currency volatility.

JAKARTA, Indonesia,
July 15--Indonesia’s new list of foreign investment limits by sector has caused head-scratching among investors. But analysts and the government say that despite confusion, it is a step towards untangling the infamous bureaucracy of Southeast Asia’s largest economy.
Indonesia is seeking to court foreign investment, with leaders insisting they are addressing concerns about entrenched corruption, red tape and legal uncertainty so the sprawling and unclear list immediately raised eyebrows.
The 61-page regulation, purportedly aimed at protecting the national interest and bolstering the development of domestic small and medium-sized enterprises, was unveiled early this month and replaces a 2001 list, AFP wrote.
It compiles a dizzying array of sectors and subsectors and their level of protection: for instance foreign ownership of a karaoke bar is set at a maximum of 50 percent, landscape architectural services at 55 percent and hospital services at 65 percent.
But Anton Gunawan, a Citibank investment analyst, praised the list for its relative clarity. What remains puzzling, however, are the criteria that were used to determine the size of permissible foreign share ownership, he said. “If we want to talk majority, minority, then it is a simple 49-51 percent thing.... But what people want to know is, for example, what does it mean to have a 95 percent ceiling compared to a 65 percent ceiling?“
Indonesia’s Chamber of Commerce and Industry (Kadin) chairman Muhammad Hidayat has been meeting with members who are similarly baffled. “What is the philosophy behind the choice of divisions for foreign ownership?“ he asked.
Hidayat declined to comment further ahead of a meeting with Indonesia’s coordinating economy minister Budiono on Monday but said Kadin would seek a series of explanations. “We would like to convince the government not to reject the DNI (negative investment regulation) but to make the DNI more complete and more simple in business terms.... There are several grey areas,“ he said.