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eBay Finds Local Partner For China Market

The U.S. Department of Agriculture has suspended Australia's monopoly wheat exporter and the leading Internet auction site, eBay, has found a local partner for its China operations after struggling to penetrate the market. Claudia Blume at VOA's Asia News Center has more on these and other business stories from the region.

The U.S. Agriculture Department has suspended Australia's monopoly wheat exporter A.W.B. from taking part in any U.S. government programs and contracts.

The announcement came after an Australian probe found last month that A.W.B. broke U.N. sanctions by paying millions of dollars in kickbacks to Saddam Hussein's regime in order to secure wheat sales in Iraq.

But A.W.B. spokesman, Peter McBride, says the move by the U.S. Department of Agriculture or U.S.D.A., will have little impact.

"The reality is, we haven't used the program since early 2004," McBride said. "The U.S.D.A. flagged this a while ago, and we have discussions with them, and we're continuing those discussions. And I should also point out that we voluntarily stood aside from using the export program, and we don't see using it in the foreseeable future."

The world's leading online auction company eBay will close its operations in China and start a joint venture there with Tom Online, a Beijing-based Internet company.

U.S.-based eBay will invest $40 million and have a 49 percent stake in the joint venture, while Tom Online will invest $20 million and control 51 percent. A new auction Web site will be launched next year.

In a similar deal last year, U.S.-based online company Yahoo turned over control of its China-based services to local partner Alibaba after failing to break into the Chinese market.

In other news from China, the country's banking regulator has approved the sale of an 85 percent stake in Guangdong Development Bank to an investment group led by Citigroup, the biggest U.S. financial company.

Last month, the consortium signed an agreement to purchase a controlling stake in the southern Chinese lender for more than $3 billion.

Citigroup will take a 20 percent stake and run the day-to-day operations of the bank, making it the first foreign lender to directly operate a Chinese bank.

Japan's export growth unexpectedly accelerated in November. Exports rose more than 12 percent compared to a year earlier, helping the trade surplus widen to almost $ 7.7 billion.

International ratings service Standard and Poor's says the economic outlook for Sri Lanka remains negative, reflecting the high level of government debt and security concerns posed by the unresolved conflict with Tamil separatists.