Morning business news - April 9Tuesday 09 April 2013 10.24
SLOVENIA LATEST CAUSE OF CONCERN IN EURO ZONE - Slovenia's creditworthiness is falling at the fastest pace in the world after that of Cyprus, as investors speculate that a banking crisis will force it to become the sixth euro country to need aid. This comes as Slovenia's two-week old government is struggling to support its banks that have been hit by recession and bad loans which are worth about a fifth of the country's economic output.
Leoš Rousek, a senior reporter with The Wall Street Journal and Dow Jones Newswires in Prague, says that Slovenia's main problems centre on an over-extended banking sector, which made relatively easy credit available to state owned businesses. The country had been one of the best achievers in Europe in recent years and so its fall from grace has come as a hard fall for Slovenians. However, the reporter says he does not believe that Slovenia's problems will spread to its neighbouring states as it is so small with a population of just 2 million and a very small share of the euro zone economy as a whole.
Ryan McGrath, from Cantor Fitzgerald in Dublin, says most of the focus of this Friday and Saturday's informal meeting of European finance ministers and Central Bank governors will be on Cyprus and Slovenia. He also says the bailout programmes of Ireland and Portugal will be on the agenda, but no firm decisions will be made. Pointing out that markets have steadied since the crisis in Cyprus, he says that better than expected quarterly results from US industrial giant Alcoa will further help to steady investors' nerves.
MORNING BRIEFS - The Irish Dairy Board said its turnover increased by 2.4% to €2.03 billion in 2012, with earnings up nearly 11% to €42.1m. Profit before tax was €16.3m, up nearly 6% on the year before. The Dairy Board is Ireland's biggest exporter of premium dairy products and employs 3,100 people globally. It said Kerrygold is now the top selling butter in Germany with a 15% market share, and that it is the number one imported butter in America. The Dairy Board launched 50 new products last year and said it is well-placed to take advantage of opportunities in the market when milk quotas end in 2015.
*** 20 years after its success with the single Linger, Limerick band The Cranberries still profits from its music, with figures filed for 2011 showing profits of nearly €72,000. The band's first album sold five million copies in the US. The group was one of the most successful rock acts of the 1990s and sold over 15 million albums in the US alone and over 40 million albums worldwide.
*** Tesco is close to admitting defeat in the US market as consumers there rejects the supermarket giant's Fresh & Easy venture there, which used up £1 billion sterling of capital and lost £850m. The venture was launched five years ago.
*** Consumer prices in China rose at 2.1% in March, easing from the 3.2% pace posted in February. The slowdown comes as food prices fell after the country's New Year holiday and the central bank drained cash from the economy. Food price inflation, which had surged to 6% year on year in February, fell back to a pace of 2.7%.