Accessibility links

Breaking News

Asia Business: China Continues to Tackle Bank Corruption - 2004-02-23

China continues to tackle corruption in its banking sector and the World Bank estimates the bird flu could cost Vietnam almost two percent of its annual Gross Domestic Product - if all its chickens have to be culled to stamp out the disease.

The Bank of China, the country's largest foreign exchange lender, has removed its vice chairman Liu Jinbao. He has been arrested on charges of fraud and corruption. Mr. Liu formerly served as the head of the Hong Kong branch.

Only days earlier, former Bank of China general manager Liang Xiaoting, was formally charged for taking hundreds of thousands of dollars in bribes. China's state-controlled media reports that Mr. Liang admitted to taking bribes. Newspapers in China say Communist Party leaders are determined to tackle corruption in the nation's state-owned banks.

Korea Electric Power Corporation, or KEPCO, has reported $2 billion in net profits for 2003 - but that is a 24 percent drop in earnings from 2002.

Energy sector analyst, Rowen Dalziell, of ING investment bank in Hong Kong, says that the weakness in South Korea's currency, the won, eroded earnings last year. Coal, which KEPCO uses to generate a third of its electricity, was also more expensive. "China announced, because of its own internal economic growth, that it would be putting a cap on coal exports and that's effectively driven the international market prices up very aggressively," says Mr. Dalziell.

The World Bank estimates that bird flu would cost Vietnam as much as $690 million - or 1.8 percent of its annual GDP if all the poultry in the country had to be culled to stop the disease.

Already about 37-million chickens have either died or been slaughtered in efforts to stop bird flu from spreading. The avian virus has not been contained in Asia and has spread to humans in Vietnam and Thailand - where some two-dozen people have died.