Japan shows signs of improvement in its long-slumping economy and Singapore Airlines posts a large drop in annual profits.
In a monthly report released Friday, Japan says its economy is bottoming out, an indication that the government believes the country will soon begin recovering from an 18-month recession. Prime Minister Junichiro Koizumi says that, while people say the economy is bad, he will not back away from his reform program and will revitalize the economy by proceeding with structural reforms.
Tokyo says economic conditions remain severe, but a timid upturn is under way, largely due to an improvement in the economies of the United States and Asia, Japan's key trading partners. However, economists caution that Japan remains too dependent on exports and say that the domestic economy remains weak.
Japan told the World Trade Organization Friday it will impose retaliatory measures against U-S tariffs on imported steel. Starting June 18, Japan will slap some U.S. steel and steel products with 100-percent tariffs. The U.S. began imposing tariffs of as much as 30-percent on some imported steel products in March. The move has drawn protests not only from Japan, but also from governments in China, South Korea, and the European Union.
Singapore Airlines, Asia's largest carrier, reports earnings of $349 million for the year ending in March. Its profits dropped by 61-percent because of falling ticket sales after the September 11 terrorist attacks in the United States. Revenue dropped five-percent for the year, although routes to Europe and Australia remain popular.
The profit numbers were better than forecast because the company recorded an unexpected one-time gain for an asset sale. Singapore Airlines officials say they will buy 13 new jets this year, but acknowledge the expansion may outstrip demand, at least temporarily.
Indonesia has started a much-awaited privatization plan. After long delays, it has sold an eight-percent stake in international phone service company, Indonesian Satellite, to overseas buyers for $110 million.
Analysts are applauding the move, even though the offer was below market levels. They say the sale shows that Indonesia is finally showing a firm commitment to its privatization program. The cash Jakarta raises from this and other asset sales will be used to reduce its budget deficit. The government says it aims to sell an additional 30-percent of Indosat later this year.