After a controversial struggle with mining corporations which spanned two years, parliament has passed a law imposing a 30 percent tax on coal mine profits. The tax will affect any company that makes $75m in profits, and with 30 Australian mining companies breaking the barrier, the government believes it will raise somewhere in the region of $10.6bn in its first three years. The levy is also designed to gradually increase employer payments into worker pension funds from 9 to 12 percent in seven years, and generate $6bn of infrastructure funding. The tax was originally touted in May 2010. The scheme sparked a furious reaction from the Associat...
Rusal, the world’s largest aluminium producer by volume, said on Monday that adjusted net profit results for 2011 showed a plunge of 91.7 percent due to high debt servicing outgoings and lower aluminium prices. The group posted a net profit of $237m compared to $2.87bn the year before largely because of a write-down in the value of its share in miner Norilsk Nickel. Figures were well below expectations, with Thomson Reuters’ analysts predicting $2.04bn. Revenues for 2011 increased 12 percent to $12.29bn from $10.98 year on year. The company also announced it has replaced executive director Tatiana Soina with Maxim Sokov. The news comes ju...
There is a growing concern about cost inflation in the Chilean mining industry, according to the CFO of London-listed Chilean mining group Antofagosta. The news comes amid worries about overall copper production in Chile, which recorded a down trend of almost eight percent year on year in January. Hussein Barma at the Jefferies copper conference on Thursday said that sourcing skilled labour will be a key driver in the future. The CFO indicated that labour accounts for just over 10 percent of Antofagasta’s total cost base but a limited pool of skilled stuff is already taking a toll on its operations. Both its projects in Caracoles and Telegr...
An executive director at US investment giant Goldman Sachs on Wednesday resigned publicly by way of a contemptuous opinion piece in the New York Times, saying the work environment had become “toxic and destructive” at the bank. Greg Smith’s parting shocker accused Goldman in the paper of losing touch with its moral compass and being ruled by a greed infested corporate culture where “clients continue to be sidelined” while the bank just “thinks about making money.” The head of the firm’s US equity derivatives business in Europe, added in the NY Times column: “Over the last 12 months I have seen five different managing directo...
Germany’s biggest utility group, EON AG, announced on Wednesday a 50 percent profit drop due to reduced power generation earnings following the closure of its nuclear reactor, and a weakened demand in its gas business. Eon said after the announcement that it will now cut its dividend by a third to €1 a share for 2011 but pointed out the payout will increase to €1.10 for 2012. The group recorded a net loss of €2.219bn in 2011 against a net profit of €5.85bn a year earlier. Net income dropped to almost €2.5bn, still beating a €2.33bn estimate by Bloomberg analysts. EON’s EBITDA fell by 30 percent to €9.293bn but sales grew 22 ...
Russian billionaire Viktor Vekselberg resigned as chairman of Rusal on Tuesday, saying the company’s bad management style, led by CEO Oleg Deripaska, has brought on a debt crisis to the world’s largest aluminium producer. Vekselberg, who has an indirect stake in the company, clashed with Rusal on strategic development issues, human resources policies and matters concerning modernisation of production. Vekselberg said in a statement: “It is with great regret that I have to state that, due to the actions of its management, Rusal is presently facing a deep crisis as a result of which it has in my opinion deteriorated from an international ...
Citigroup has announced late on Sunday it is to increase its China presence to a hundred from the current 47 within two to three years, according to the CEO for Asian operations, Stephen Bird. Doubling the branches will help speed up its drive into China’s credit card business and an imminent securities joint venture. According to Bird, Citigroup has benefited from its endeavours to help Chinese institutions widen their technology and products as it has achieved approval for its own undertakings in the process. The bank bought stakes in Chinese companies in an attempt to position itself among the most influential lenders within the market. ...
The US Treasury Department late on Wednesday reached a deal with insurer AIG to sell off an estimated $6bn in stock in an attempt to gradually sell down the stake it still owns. The Department already cut its stake to 77 percent when it sold 200 million shares last May. Shares are now being offered at $29 apiece. Under the agreement, AIG has to pay off over $8.5bn in obligations. AIG’s CEO Robert Benmosche said in a statement: “The people of AIG have achieved another significant milestone in their progress toward the goal that American taxpayers recoup their entire investment in AIG at a profit.”...
Greece increased the pressure on its creditors late on Tuesday, as it looks to secure a bond swap deal that will help write off an estimated 53.5 percent of the country’s privately held debt. Athens informed creditors that it is reassessing its options concerning non-payment, saying it will default on any bondholders unwilling to participate in the €206bn debt restructuring. Private creditors in Greece now have until Thursday to decide. New legislation has already been passed to force bondholders to participate. Greek banks, which hold up to €45bn of the sovereign bonds already agreed to take part in the debt swap deal, Greece’s finan...
Greek Tourism Minister Pavlos Yeroulanos believes that the EU is responsible for Greece’s current economic situation. “People should remember that European institutions have been monitoring the Greek economy since 2004… What happened between 2004 and 2009? Either the EU was not doing its job correctly, or it knew what the situation was and hid it,” Yeroulanos said on Tuesday. Yeroulanos’ comments come as fears grow over whether the recent supplementary €130bn bailout package (dubbed “the world’s most expensive sticking plaster”, by Guardian Economics editor Larry Elliott) afforded to Greece will be able to alleviate Greek fi...