BUSINESS WEDNESDAY, APRIL 2, 2014 Crimea spurs German rethink on energy policy BERLIN: Current tensions with Russia over Ukraine must be found.Last week, Chancellor Angela Merkel would constitute a clear ‘yes’ to the use of fracking,” last week, while Gabriel suggested there was “no sen- have turned the spotlight on Germany’s heavy said the Ukraine crisis would lead to “a new look at said one of Merkel’s former ministers, the conserva- sible alternative” to Russian gas. The issue is suffi- dependence on Russian gas and are pushing Europe’s energy policy as a whole.” Some people have inter- tive Peter Ramsauer. And “that, in turn, would beg the ciently important to be on the agenda of an energy biggest economy to reconsider its entire energy poli- preted this seemingly anodyne remark as a hidden question, why not tap our own domestic resources,” summit yesterday evening between Merkel, Gabriel cy. It is currently Germany’s aim to be able to meet as call to reconsider Germany’s plans and targets for the he said. and the heads of Germany’s 16 regional states. Berlin much as 80 percent of its energy needs from renew- energy transformation, formulated by Merkel herself With parliament yet to give its green light to the is counting on a deep reform of its system of subsi- able sources such as wind and solar power by 2050. three years ago. Others suggest that the remarks- general use of fracking, the technology’s advocates, dies for clean energy, currently the cornerstone of the The country is also committed to phasing out nuclear made in the presence of Canadian Prime Minister above all industry, never tire in pointing to the com- country’s energy transition. power completely over the next decade or so. Stephen Harper-could herald an about-face on the paratively high cost of energy in Europe. A corresponding draft law, one of Merkel’s key And gas — 35 percent of which Germany imports highly controversial technology of fracking. That, they argue, is due to the fact that fracking is projects during her third term in office, is to be from Russia-should act as a good stop-gap until the not currently allowed. And they hope that the current approved by cabinet on April 9. But the draft has country’s renewable capacity is fully in place. But with Fracking in spotlight debate over Germany’s dependence on Russia gas come under heavy scrutiny on the part of the regional the crisis over Ukraine and the threat of a tit-for-tat At a joint news conference, Harper said that will advance their cause. states who take issue with subsidy cuts. battle of sanctions, Germany may have to reconsider Canada was prepared to export its natural gas. But But Economy and Energy Minister Sigmar Gabriel “We mustn’t expect all differences to be ironed its energy policy. that could prove problematic in a country where and Environment Minister Barbara Hendricks, both out” yesterday, said Merkel’s spokesman Steffen Some, like the environmentalist Greens party, there is deep popular and political-opposition to centre-left Social Democrats, have firmly shut the Seibert. Gabriel wants substantial reductions in subsi- insist the country should step up its renewable drive hydraulic fracturing for shale oil and gas. “If the chan- door on such a prospect. dies for renewables, so as to bring down consumers’ while others insist that alternative sources of gas cellor is eyeing imports from North America, that “In no case do we want fracking,” Hendricks said electricity bills. — AFP Japan shoppers see first sales tax rise in 17 years Shoppers make last-minute dash to stores TOKYO: Prices rose across Japan yesterday as a controversial sales tax rise came into effect, with everything from beer to washing machines costing more, sparking fears a drop in consumer spending will derail a nascent economic recovery. Tokyo hiked the levy to 8.0 percent from 5.0 percent as it looks to control a public debt mountain, but corpo- rate Japan’s concerns were highlighted by a closely watched survey of business sentiment showing bosses are cautious about the future. In a country beset by years of deflation, critics warn that already thrifty consumers JAKARTA: Laborers work on a building under construction in Jakarta yesterday. Indonesia swung to a would snap their wallets shut. Millions of higher-than-expected trade surplus in February as a jump in palm oil prices and slowdown in imports shoppers made a last-minute dash to stores boosted Southeast Asia’s top economy, official data showed yesterday. — AFP in recent weeks, while nervous retailers are now watching for signs of falling sales. The last time Japan rolled out a higher sales levy, TOKYO: People shop at the Itoyokado supermarket in Tokyo yesterday. Prices rose across Indonesia swings to trade in 1997, it was followed by years of deflation Japan yesterday as a controversial sales tax rise came into effect, with everything from and tepid growth, although other factors, beer to washing machines costing more, sparking fears a drop in consumer spending will including the Asian financial crisis, were also derail a nascent economic recovery. — AFP surplus on palm oil prices blamed. Among those waking up to the high- er prices was 18-year-old university student JAKARTA: Indonesia swung to a higher-than-expect- percent in February due to cheaper food costs, the Hibiki Ishida, who was not impressed when ed trade surplus in February as a jump in palm oil data showed, continuing a recent downward trend he bought his favorite chewing gum yester- India keeps rates on prices and slowdown in imports boosted Southeast after a surge last year sparked by a fuel price hike. day. “I get this gum every morning and I know Asia’s top economy, official data showed yesterday. However, the figure is still above the central bank’s the price is 120 yen ($1.15),” he said. The surplus of $785.3 million came after a $431 mil- target of 3.5-5.5 percent. The data is positive news for “But I handed 120 yen to the shop clerk hold ahead of polls lion deficit in January caused by a controversial ban on the economy after speculation the US Federal Reserve today and she told me it was now 123 yen- mineral ore shipments that hit exports. Economists would start to wind down its economic stimulus pro- that unnerved me.” Others, like a 20-year-old MUMBAI: India’s central bank kept key interest led by conservative hawk Narendra Modi, win- had expected a surplus of around $420 million. gram prompted huge falls in the Jakarta stock market graduate surnamed Yoshida-who is set to rates steady yesterday in a widely anticipated ning the elections which end in May. Foreign Inflation also eased in March, and both indicators and rupiah last year. start a new job and live on her own-have move less than a week before the start of nation- investors have driven up the Indian stock market add to signs in recent months that the economy has Both the currency and stocks have also recently been planning for the hike, with some help. al elections. After a meeting in the financial capi- in recent months, expecting a more business- stabilised after being hard hit by emerging market tur- regained strength but the central bank warned last “My mother has given me lots of daily tal Mumbai, the Reserve Bank of India (RBI) said friendly government to take over from the scan- moil last summer. The price of crude palm oil rose month economic growth was still at risk of further stuff like tissue paper and plastic cling wrap,” the benchmark repo rate, at which it lends to dal-tainted Congress party. Congress has about four percent in February, according to data from tapering and a slowdown in China. she said. commercial banks, would remain at 8.0 percent. become deeply unpopular after a decade in the national statistics agency. Analysts have said the bank may face pressure to “So I can survive for the time being.” The “At the current juncture, it is appropriate to power over a string of corruption scandals and Indonesia is the world’s biggest producer of the cut rates from the present 7.5 percent in coming rise has presented a huge challenge for Prime hold the policy rate, while allowing the rate the slowing economy, which is expanding at its commodity, which is used in numerous everyday months, as the country holds nationwide legislative Minister Shinzo Abe since he swept to power increases undertaken during September 2013- slowest rate in a decade. Despite the economic goods from biscuits to shampoo. Imports fell nearly 10 and presidential elections. Slightly offsetting the news, in late 2012 on a ticket to drag the world’s January 2014 to work their way through the slowdown, economists do not foresee rate cuts. percent on year to $13.78 billion, the data showed. HSBC’s manufacturing purchasing managers index-a number-three economy out of a cycle of economy,” RBI governor Raghuram Rajan wrote “We are staring at a long pause (on rates). “The trade surplus was beyond our expectation and gauge of manufacturing activity-narrowed further in falling prices and tepid growth. in his statement. The RBI last raised rates on Uncertainty on inflation will keep RBI on its toes we believe it was helped by the high (palm oil) prices March to 50.1, from 50.5 in February, with the bank January 28, the third hike since September last and prevent rate cut even in if industrial slow- and a decline in imports,” said Bank Central Asia econ- blaming a slowdown in domestic demand.