Faced with the virtual collapse of pension plans drawn up in the Soviet era, the EU's newer members from the ex-communist east plan to push the retirement age out to 62 or 63 in the next decade. (Google Photo)

BRUSSELS, Belgium, May 28--Britain’s new plan to raise the retirement age to 68 is one of the most effective and widely used approaches in Europe to overhaul pension schemes in an effort to defuse a demographic time bomb, AFP said.
From Finland to Hungary, encouraging and even forcing people to work longer has recently become the method of choice, although often unpopular, for European Union countries to finance the pensions of an ever-ageing population.
Since the baby boom in the years just after World War II, an increase in life expectancy coupled with low birth rates has placed severe strain on not only retirement funds in the 25-member bloc, but also on health care services.
It’s a time bomb that the European Commission, the EU executive body, says is set to explode by 2050.
In Greece, for example, the percentage of people over 65 compared to those of working age is expected to virtually double in that time, as will public pension outlays in Portugal.
“Member states should exploit a fast-closing window of opportunity to intensify reform efforts, especially in those cases where the long-term sustainability of public finances is most at risk,“ says EU Economic and Monetary Affairs Commissioner Joaquin Almunia.
“Unless this is done, many EU countries, from the old to the new members, will simply not be able to face the cost; not when there will be two workers per elderly citizen as opposed to a ratio of four to one now.“
In recent years, the trend of lowering retirement ages and introducing early retirement schemes has been exposed as impossible to sustain and politicians are slowly biting the bullet.
But retirees also make up a substantial part of the voting population -- witness former Italian prime minister Silvio Berlusconi’s pledge in April to give them free rail travel and access to sporting events, museums and cinemas.
Unions in France, Greece and Italy are also fighting the changes.
So too in Denmark, where a recent newspaper poll showed that two-thirds of people are against reforms to the pension scheme there.
But with potential economic growth rates in the EU set to drop by half by 2030, prevention now will be less painful than a cure in the future.
Faced with the virtual collapse of pension plans drawn up in the Soviet era, the EU’s newer members from the ex-communist east almost all plan to push the retirement age out to 62 or 63 in the next decade.

BEIJING, May 28--China’s oil supply is facing risks, which need to be solved mainly through domestic efforts, Xinhuanet quoted an oil expert as saying.
Zhu Jianjun, a researcher with China National Petroleum Corporation (CNPC), China’s largest oil producer, said at a forum on China’s energy strategy that it is not oil shortage but the uneven distribution of oil resources that caused instability in the world oil market. Soaring oil prices is the first risk, Zhu said.
Rapid growth of the world economy has led to a sharp rise of oil consumption in recent years. Conflicts and financial speculation also help to drive oil price higher. Depreciation of the US dollar is another factor for the oil price hikes, he said.
According to statistics, China spent $43 billion importing oil in 2004 and the figure rose to over $50 billion in 2005.
Zhu predicted that China’s spending on oil imports will keep rising as its imports increase and international oil price remains at a high level.
Transportation also poses a problem for China’s oil supply, Zhu said.
China now imports 140 to 150 million tons of oil a year, and over 70 percent of the imports have to go through the Malacca Straits in Southeast Asia. As the channel is now near its capacity, other channels have to be found, he said.
China imported some 110 million tons of crude oil in 2004, but only 9 percent was shipped by Chinese oil tankers.
According to statistics of Shanghai Shipping Exchange, by October 2005 China had more than 590 oil tankers with a combined capacity of only 12 million deadweight tons.
To remove the risks, China must rely on increasing domestic oil and natural gas supply as well as develop overseas sources to ensure diversified supply and transportation channels, Zhu said.
China should establish its own oil strategic reserve system and early warning system, improve energy efficiency and develop alternative energies to reduce oil consumption so as to ensure oil supply security, he said.

LONDON, May 28--Venezuela’s Treasury plans to buy $100 million of Bolivian government debt, part of Venezuelan President Hugo Chavez’s move to back Bolivian President Evo Morales as he seizes oil assets and rewrites the constitution, Bloomberg reported.
The plan is part of more than a dozen Bolivia-Venezuela cooperation treaties signed during Chavez’s visit to La Paz, Bolivia’s finance ministry said on its Web site. The bonds will pay lower interest rates and be for longer terms than current Bolivian debt averages, the statement said, without saying by how much or giving the averages.
Under the treaties, Chavez agreed to spend more than $1.5 billion in Bolivia on oil exploration and refining, industrial development and health care, aid that Chavez is using to solidify the Bolivarian Alternative for the Americas, a Venezuelan-led anti-US trade block.
“I think Chavez is trying to do what he did for Argentina and Ecuador, help bolster a friendly government’s finances as its leaders try to build political backing,“ said Armando Alvarez, president of the Bolivian Stock Exchange in an interview in La Paz. “If they buy that much, it will be enough to finance about half the government’s annual budget shortfall.“
Venezuela bought $25 million of Ecuadorian bonds on Dec. 7 and has bought about $1.7 billion of Argentine government bonds in dollars this year.
The Venezuelan bond purchases are expected to finance about 37 percent of the Bolivian government’s estimated $270 million budget shortfall for 2006, the finance ministry Web site said. The deficit is expected to be 3.2 percent of the country’s gross domestic product.
Morales, who took office in January is in the middle of a campaign to rewrite Bolivia’s constitution. Yesterday, Morales and Chavez urged Bolivians to vote overwhelmingly for candidates from Morales’ Movement Toward Socialism Party, known by its Spanish initials, MAS, which also means “more“ in Spanish.

An offshore gas processing plant built by Norwegian energy group Statoil is seen on Melkoya Island, off Hammerfest, northern Norway. (Reuters Photo)

HAMMERFEST, Norway, May 28--Sky-high prices and dwindling supplies have rekindled the interest of oil companies in the Arctic region, which remains largely unexplored and could hold a quarter of the world’s undiscovered oil and gas reserves.
“After a relative lack of interest in the 1990s, we have seen a resurgence in the appeal of the Barents Sea and we think this is likely to continue,“ Norwegian deputy oil and energy minister Anita Utseth told AFP.
To date, limited exploratory drilling in the Barents has met with only modest success.
But as the oil price hovers around 70 dollars a barrel, drilling in the Arctic is beginning to look increasingly attractive, despite the cost and complexity.
“The chances of success are small, but if you do strike oil, the returns can be huge,“ says Oerjan Birkeland, head of Norwegian oil group Statoil’s exploration of the Barents Sea.
New technologies and melting ice sheets caused by global warming make it easier to tap into oil and gas fields in the unforgiving conditions of the Barents.
Snoehvit, Goliat and Shtokman are vast fields that could allow Europe and the United States to reduce their dependency on troubled Middle East supplies.
According to the US Geological Survey, the Arctic could contain up to a quarter of the world’s undiscovered oil and gas reserves.
Off the coast of Hammerfest, in the far north of Norway, Statoil’s Snoehvit gas field is nearing completion and is due to begin production at the end of 2007.
In the same region, Italian energy firm Eni’s appropriately named Goliat field is estimated to contain around 250 million barrels of oil equivalents.
In the Russian camp, Gazprom’s Shtokman venture could supply the European Union’s oil needs for seven years. Statoil, Norsk Hydro, ConocoPhillips, ChevronTexaco and Total are all keen to cooperate for a share in the project.
Even larger fields are in the offing, such as Fedinsky, in disputed waters between Norway and Russia.
Officially the two countries are keen to cooperate, but diplomats talk privately of competition, even a new cold war, for control of these resources.

WASHINGTON, May 28--After the dramatic convictions in the Enron fraud trial, analysts expect fresh scrutiny of the law, inspired by one of corporate America’s worst scandals, toughening standards for business leaders.
According to AFP, the guilty verdicts in the Texas trial of former Enron chief executives Kenneth Lay and Jeffrey Skilling may prompt fresh debate in Congress over the ethics law passed in 2002 at the height of the scandals, known as the Sarbanes-Oxley Act.
The Enron scandal shook the corporate world and “it did spark wholesale change“ in corporate regulation, said Henry Hu, professor of corporate governance at the University of Texas.
A storm of protests from US businesses and foreign firms listed in the United States over the costs of compliance has reached Congress, where efforts are underway to modify the law.
The Sarbanes-Oxley law “imposed mechanistic bureaucratic procedures to overcome the natural propensities of human nature,“ said Alex Pollock, a resident fellow at the American Enterprise Institute, who said he hopes the Enron verdicts would be a “catharsis“ that prompts a reform of the law.
Some domestic and foreign companies have said they would delist their stocks from US markets rather than comply with the burdens of reporting under the new law.
The US Chamber of Commerce argues the regulations have cost billions of dollars.
“Entire industries have been consumed by multiple, sweeping demands from competing regulators for their data, e-mails, and correspondence,“ the Chamber said in a recent statement.
Even supporters of the Sarbanes-Oxley law acknowledge it may have imposed excessive costs on publicly traded companies, forcing them to include an extra layer of audit controls and to complete additional paperwork.

NEW DELHI, India, May 28--India, already the world’s fastest growing wireless services market, is set to become a handset manufacturing and export hub as giants such as Nokia and LG churn out millions of phones to tap voracious demand, Reuters said.
Global handset firms are knocking on the door of Asia’s third-largest economy because of its established software industry, a booming domestic market and they want another manufacturing stronghold to offset the possible risk of operating plants in China.
The consulting firm helped Elcoteq SE, Europe’s largest contract electronics maker, to set up a unit in Bangalore, India’s silicon valley.
It is also assisting several suppliers to Nokia to set up plants in Bangalore, Pune and the southern port city of Chennai.
More than 40 percent of the software that goes into Motorola Inc. iconic and ultra-thin RAZR handset is developed in its Indian R&D facility.
Nokia, which controls nearly half the $2.5 billion Indian handset market, and its suppliers are investing about $150 million in its Chennai unit, which makes a few million handsets a month and has already exported phones to south east Asian nations like Singapore, Indonesia and Thailand.
Two of Nokia’s suppliers--Aspocomp group and Perlos Corp.--are investing $70 million and $12 million respectively to set up a printed circuit board unit and a mechanics factory.
South Korean conglomerate LG Electronics Inc., for its part, operates a plant in the western city of Pune that will churn out 20 million GSM and CDMA handsets by 2010, roughly half of which are earmarked for export.
India’s domestic market, forecast to grow to $5.8 billion by 2010, is expected to consume about 55 million handsets this year, up 71 percent from 2005. Between 4 million and 5 million new users are coming into the market each month, attracted to the world’s cheapest local mobile call rates of as low as 2 US cents a minute.