'Instant chicken' scandal: McDonald's admits Liuhe was supplier

Want China Times, Staff Reporter 2012-12-27

A McDonald's outlet in Beijing. (Photo/CNS)

McDonald's has finally admitted that the company at the center of China's "instant chicken" scandal was one of its suppliers, the state newswire Xinhua reports.

The global fast food chain had initially denied it did business with the Shandong-based Liuhe Group, a major supplier to rival KFC, which was discovered to have used excessive antibiotics and illegal hormones and chemicals to speed up the growth of its broiler chickens.

Following continued public and media scrutiny, however, McDonald's now says that Liuhe was in fact one of its "second-tier" or "downstream" suppliers, although it has stopped buying chicken from the company since Dec. 18 and samples of McDonald's products have subsequently been tested by the Shanghai Food and Drug Administration.

McDonald's had been reluctant to comment after the scandal first came to light, only previously publishing a notice on its official Chinese microblog claiming that all its chicken products had passed stringent quality controls and met government standards after independent third-party laboratory testing.

A McDonald's China spokesperson said that the restaurant chain was not directly stocked by Liuhe and that quality controls of its second-tier suppliers are carried out by its first-tier suppliers.

According to Xinhua, second-tier suppliers provide the basic raw materials, while first-tier suppliers process the raw materials into chicken products. McDonald's does not deal directly with second-tier suppliers and relies on its first-tier suppliers to enforce quality controls, the spokesperson added.

The world's largest fast food chain added that it also conducts quality checks on every batch of its chicken products but has so far not found excessive antibiotic levels in Liuhe's chicken, while hormone levels are not tested as part of the checks.

A spokesperson from China's Ministry of Agriculture said on Tuesday morning that the scandal is still under investigation but all suspect chicken farms and processing plants have been shut down.

A KFC outlet in Shanghai.
anim(Photo/Xinhua)

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Ghana told to free Argentine ship Libertad by UN court

BBC News, 15 December 2012

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The ARA Libertad is being manned
 by a skeleton crew in the port of Tema

A UN court has ordered the release of an Argentine naval ship impounded by Ghana over a debt dispute.

The UN International Tribunal for the Law of the Sea, based in Germany, ruled that the ARA Libertad had immunity because it was a military vessel.

The ship has been held in the port of Tema since October when a local court ruled in favour of a financial fund.

The fund says it is owed $370m (£233m) by the Argentine government as a result of its debt default a decade ago.

A skeleton crew has stayed on board the three-masted training ship since about 300 personnel and naval cadets flew home in October.

The tribunal in Hamburg ordered that Ghana should "forthwith and unconditionally release the frigate ARA Libertad" and ensure the ship and its crew can leave Ghanaian waters.

It set a deadline of 22 December for the ship to have left the port.

Tribunal president Shunji Yanai ordered that the vessel should be resupplied if needed.

The court said that holding the ship was "a source of conflict that may endanger friendly relations among states".

Last month, sailors on board the Libertad reportedly drew guns on Ghanaian officials after they tried to board the vessel to move it to another berth.

Immunity 'violated'

An agent for the Ghanaian government who was at the court said after the ruling that it would "carefully consider the tribunal's order with a view to ensuring that it is given effect."

Financial fund NML Capital has so far not commented on the ruling.

NML is a subsidiary of US hedge fund Elliot Capital Management, which is one of Argentina's former creditors.

Argentina had argued that the seizure violated the immunity of military vessels under international maritime law.

In 2001 and 2002, Argentina defaulted on more than $100bn of debt. Most of these loans were subsequently restructured, giving creditors about 30% of their money back.

However, some creditors including Elliot chose to hold out, pursuing the Argentine government through the courts. 

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Among the loans underwritten by the Export Credits Guarantee
Department  was one for £35m to Robert Mugabe's Zimbabwe for
the purchase of five of BAE Systems' Hawk fighter jets. 
Photograph: PA

Britain owed millions for weapons used by autocratic regimes

Former Indonesian president General Suharto. Britain lent 
the country  more than £630m at a time when Suharto 
was stifling demonstrations. Photograph: AP

The Changing of the Guard

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SaLuSa channeled by Mike Quinsey – Dec 14, 2012

“… There are some beautiful souls of compassion and love who know nothing about Ascension, and they will also join up with the Lightworkers. As the changes are put in hand there will be much to do for those who are enlightened and wish to serve others. For a while needs such as healing will be handled in many different ways, until you all have access to local centers with modern healing facilities. Some difficulties may arise until your society has been fully integrated into the new way of life. Having been brought up in the Space Age you will of course adapt to it very quickly. New technologies will overcome most of your problems in quick time, and we are urging our Earth allies to push forward with the promotion of free energy devices.

General conditions on Earth are getting worse due to weather variations, and also interference in markets that are being manipulated for gain. Whether it be food or money, speculators continue to bring misery in a world that is already in a turmoil. However, these conditions will not last very long and not allowed to be repeated. Big business and especially the banks will be totally re-organized, so as to ensure there is never again a collapse like you recently experienced. Monetary systems will in any event change, and a fairer system of valuation introduced. It will result in honest trading and put an end to corrupt practices. As we have told you many times, wealth also will be re-distributed and we are already starting to recover hidden caches of valuable metals. Add to it St. Germain's World Trust Fund, and you will have sufficient to ensure that everyone is above the poverty levels that so many are experiencing now.

Money and valuables acquired honestly will be kept in possession of the bona fide owners. However, anything else that has been obtained dishonestly will be recovered. A feature of your future lives will be that criminality will disappear, as such actions will not enter the minds of those who have ascended. Consciousness levels will be so high that honesty in all dealings can be taken for granted. Plus the fact that people that are cared for and have their needs covered, are happy and at One with everyone else. Yes, Dear Ones so much is about to change that you have nothing to worry about, but please exercise patience while matters are being sorted out. Our absence so far is not to be seen as a deliberate act on our part, as we would have liked to come out openly some time ago. However, what you are achieving by your own endeavors is a credit to your intent to see the way clear to Ascension. We have helped of course to stop interference that would seriously hamper your work. …”

Constitutional Court Rejects Review to Transfer Lapindo Mudflow Compensation

Jakarta Globe, December 14, 2012

Victims of the Lapindo mud flow rally in front of the State Palace for World Human
 Rights Day. The protestors demanded the government prosecute those responsible
for a mud volcano that inundated much of their town. (JG Photo/Safir Makki) 

             

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The Constitutional Court has rejected a request to transfer the full burden of compensation covering all the land affected by the Lapindo mudflow, to the oil and gas company owned by the family of Golkar chairman Aburizal Bakrie.

Several people including former Airlangga University lecturer Tjuk Kasturi Sukiadi and author Ali Azhar Akbar had filed a judicial review questioning why money from the state budget was being used to compensate a mistake made by the company, Lapindo Brantas.

The Sidoarjo mudflow in East Java — which began erupting in May 2006 after the blowout of one of Lapindo’s natural gas wells — destroyed hundreds of homes, swamped 720 hectares of land and displaced thousands of people.

The company only agreed to compensate victims within the boundaries of the affected area.

The applicants had asked for a review of article 18 and 19 of the 2012 Law on State Budget — which said the Sidoarjo Mudflow Mitigation Agency (BPLS) could use the funds from the state budget to compensate the victims whose land in three villages located outside of the map of the affected area were damaged, costs which Lapindo refused to pay.

They said the state budget should not be used to compensate the mistake made by the company.

But the court considered that allocating the state budget to handle the problem created by the mudflow outside the map of the affected area did not eliminate the responsibility and obligations of Lapindo Brantas.

“[The court] declares rejecting the whole request of the applicants,” chairman of the Constitutional Court Mahfud MD said on Thursday as quoted by Antarasumbar.com.

The court judge Anwar Usman said the government had shared the compensation responsibility with Lapindo Brantas, adding that Lapindo were still responsible for compensating those who lived within the affected area map, while the government covered the compensation for those who lived outside the map of the affected area.

“If the government did not share the responsibility to solve the problems of Sidoarjo people, they would have been suffering without legal certainty,” Anwar said.

“Buying the land and building outside the map of the affected area as part of the mitigation effort on mudflow eruption is not against the constitution. The court consider the applicant's request to review [the law] was legally not proven and baseless.”

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Bleak day for British banking as Libor arrests follow record fine for HSBC

HSBC hit with £1.2bn fine by US regulators, while SFO arrest three in connection with investigation into interest rate rigging

The Guardian, Jill Treanor, City editor, Tuesday 11 December 2012

HSBC had allowed drugs traffickers to launder billions of dollars and
 billions more to be moved to countries facing sanctions. Photograph:
Mike Segar/Reuters

The reputation of Britain's banking industry took a fresh battering when HSBC was slapped with a record £1.2bn fine by US regulators for money laundering and sanctions busting, the first arrests were made in the Libor-rigging investigation, and nationalised Northern Rock handed the taxpayer a £270m bill to compensate customers affected by a mistake in its paperwork.

The US Department of Justice (DoJ) detailed how HSBC, Britain's biggest bank, allowed drug traffickers to launder billions of dollars in the US and billions more to be moved across borders to countries facing sanctions, such as Burma, Cuba and Libya.

The department spared HSBC a criminal prosecution only because it considered the bank too big to prosecute. Listing a catalogue of mistakes by HSBC over almost a decade, the DoJ admitted that "collateral consequences" were a factor in its decision not to pursue criminal charges. Those consequences, it said, could have included a ban on doing business in the US, resulting in huge job losses.

The fine being paid by HSBC, and a five-year deferred prosecution agreement which will keep the bank under intense scrutiny and restrict top executive bonuses, was even larger than the £940m HSBC had warned it might face to settle the allegations in July.

HSBC's chief executive, Stuart Gulliver, apologised for the events which included laundering $881m (£547m) for two drug cartels in Mexico and Columbia and accepting $15bn in unexplained "bulk cash", across the bank's counters in Mexico, Russia and other countries.

The embarrassment heaped on HSBC came just hours after close rival Standard Chartered, based in London, was forced to pay out a total of £415m to US regulators for breaching sanctions with Iran.

The Serious Fraud Office announced on Tuesday it had arrested three British men, aged 33, 41 and 47, in connection with its criminal investigation into the rigging of the benchmark interest rate. The investigation was sparked when Barclays was fined £290m by regulators in June for Libor manipulation. None of the three men arrested worked at Barclays.

The fines are just the latest setback for an industry which is reeling from the revelations in the Libor investigations at Barclays, where traders offered each other bottles of Bollinger to fix rates. The scandal prompted the departure of Barclays' chairman Marcus Agius, chief executive Bob Diamond and Barclays also received a £480,000 fine from Spanish authorities for under-rating the risk of bonds it sold to clients in 2008.

The rest of Britain's banks are now braced for a series of fines from the Financial Services Authority for manipulation of Libor. The Royal Bank of Scotland and Swiss bank UBS are expected to settle with the FSA in the coming days and both will face huge fines.

Taxpayers were forced to take more pain from the five-year-old banking crisis after the nationalised "bad bank" part of Northern Rock revealed a blunder in the information it had sent to borrowers. The error has landed Northern Rock Asset Management with a bill for £270m to repay 152,000 customers the interest they had paid for the past three years – the equivalent to £1,755 per customer. Lord Oakeshott, the Liberal Democrat peer, calculated that was the equivalent of a contribution of £8 to £10 per taxpayer. "This is £270m straight out of the taxpayers' pocket. I've been repeatedly assured in parliament that there was no black hole in Northern Rock. UK Financial Investments and the Treasury didn't know what they were talking about," he said.

At HSBC, Gulliver was at pains to insist that the bank was "a fundamentally different organisation" now to the one which allowed the breaches of US rules to take place. The focus turned on his predecessors, including the former chairman Stephen Green who was awarded a peerage and a role as a trade minister two years ago.

"Lord Green is not only a senior minister in the government, but an adviser to George Osborne on banking and a member of the cabinet committee on banking reform. He cannot continue to duck detailed questions about his time in charge of HSBC," said Chris Leslie, shadow financial secretary to the Treasury.

A spokesman for the Department for Business Innovation and Skills, which Green represents, said that Lord Green had already said that he shares the bank's regret for the events. But campaigners for "better banking" urged HSBC customers to move their money. "Sorry is not good enough. The size of this fine shows just how flawed our financial system is and how morally bankrupt many UK banks are. Ultimately its bank customers that will pay the price for HSBC's criminal activity," said Laura Willoughby, chief executive of Move Your Money.

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SBY Hails Sports Minister's Resignation as 'Good Example'

Jakarta Globe, December 07, 2012

Youth and Sports Minister Andi Mallarangeng testifying in the trial of ousted
 Democratic Party Treasurer Muhammad Nazaruddin at the corruption court
in Jakarta on Feb. 22, 2012. (EPA Photo)   

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President Susilo Bambang Yudhoyono said on Friday that he respected and appreciated the decision of Youth and Sports Minister Andi Mallarangeng to resign, hailing it as "a good example of responsibility shown by someone who is facing legal problems."

Yudhoyono said that as patron of the Democratic Party, he had also accepted Andi's resignation from the party's Board of Patrons.

Andi, who was named a suspect by the Corruption Eradication Commission (KPK) on Thursday over the Hambalang sports center graft case, is the first active government minister to resign over suspicion of corruption.

Yudhoyono said that Andi, who used to be his spokesman, cited three reasons for resigning. First, his inability to perform his duties effectively after being slapped with a travel ban; second, to not disturb the performance of the cabinet and not be a burden to his fellow ministers and the president; and lastly, to be able to concentrate on facing his legal problems.

"After listening carefully, and reading the letter of resignation, I have accepted and approved the resignation," Yudhoyono said in a televised press conference shortly before noon on Friday.

"I hope that justice can be upheld fairly and truthfully in this country," he added.

KPK chairman Abraham Samad announced on Thursday that Andi was named a suspect on Dec. 3 for abuse of power to benefit himself or others, and causing losses to the state. The charge carries up to 20 years in jail and fines of up to Rp 1 billion.

The suspicion was related to the Hambalang sports center graft case. The Supreme Audit Agency (BPK), which performed an audit on the project, said it was full of irregularities that had potentially cost the state up to Rp 243 billion in losses.

The results of the audit also showed that Andi was responsible for presiding over procedural malpractice related to his ministry’s budgeting. The minister allowed his secretary, Wafid Muharram, to sign the Hambalang procurement contract, against a government regulation requiring contracts of more than Rp 50 billion to be signed by the minister.

Andi has maintained his innocence.

"I am certain that the many accusations that have been leveled against me are not true," Andi said on Friday morning after announcing his resignation, adding that he hoped that "truth and justice" would eventually prevail.

He also said that he had yet to receive an official copy of the travel ban imposed on him or the document declaring him a graft suspect.

"I respect the decision of the KPK and will follow whatever legal process is necessary. I am ready to fully cooperate in settling this Hambalang case," Andi said.

"Whoever is guilty should legally be held responsible, but those who are not guilty should also be declared not guilty," he said.

Andi, a US-educated political scientist, has been known as a close adviser to the president on certain political issues. He is also said to be very close with Yudhoyono’s family.

Rolls-Royce warns it may face corruption charges

MSN China, AFP, 12/06/2012

Aircraft engine maker Rolls-Royce said it may be prosecuted over alleged "malpractice" in Indonesia and China after passing on information related to bribery concerns to Britain's fraud office.

Rolls-Royce warns it may face corruption charges

"It is too early to predict the outcomes, but these could include the prosecution of individuals and of the company," Rolls-Royce said in a statement, released on Thursday.

The British group said it had "passed information to the Serious Fraud Office (SFO) relating to concerns about bribery and corruption involving intermediaries in overseas markets."

It added: "This follows a request for information from the SFO about allegations of malpractice in Indonesia and China. Investigations by Rolls-Royce have identified matters of concern in these, and in other overseas markets."

Rolls-Royce said it would co-operate fully with the SFO.

"I want to make it crystal clear that neither I nor the board will tolerate improper business conduct of any sort and will take all necessary action to ensure compliance," said Rolls-Royce chief executive John Rishton.

"This is a company with exceptional prospects and I will not accept any behaviour that undermines its future success," he said in the statement.

Rolls-Royce added that it had significantly strengthened its compliance procedures in recent years, including the introduction of a new ethics code.

"As a further measure, Rolls-Royce will appoint an independent senior figure who will lead a review of current procedures," it announced on Thursday.

China, South Korea to boost local currency usage under trade pact

Want China Times, Lin Tien-wei and Staff Reporter 2012-12-06

A ad for renminbi services on a street of Hong Kong. (File photo/CNS)

South Korea's central bank said on Dec. 4 that it will enter a 360 billion yuan (US$59 billion) currency swap agreement with its Chinese counterpart in mid-December. This will support trade currency settlements made by local companies in each country by using a yuan-won swap line.

This move is expected to boost bilateral trade between China and South Korea and promote the globalization of the renminbi.

South Korea's Seoul-based Yonhap News Agency reported that the central banks of the two countries will each open an account in the other country's central bank and deposit their local currency into a lending account. The renminbi deposits made by South Korea in China's central bank will be lent to Korean importers through the Bank of Korea for payments due to China's export enterprises. Likewise, Chinese firms can also obtain renminbi-denominated loans when exporting to South Korea.

In other words, under the agreement, South Korean firms will be able to borrow renminbi-denominated funds for trade settlements from local banks, and the BOK will lend renminbi-denominated funds secured under the currency swap line with the People's Bank of China.

If the currency swap agreement is implemented smoothly, it will encourage renminbi and won usage in bilateral trade. "We plan to arrange similar agreements with Japan and other Asian countries after this," a BOK official said.

The report said that South Korea's central bank planned on selecting lending banks to have them sign agreements related to foreign exchange loans. This would also impose restrictions on loan quotas.

To help decrease an over-reliance on the US dollar, China has aggressively promoted cross-border trade settlements using the renminbi and has signed currency swap agreements with several countries to improve the usage volume for the currency, the report said.

It added that the move would also help reduce companies' exposure to currency risks and transaction costs, as well as ease external vulnerability by decreasing a reliance on major reserve currencies.

China is South Korea's largest foreign trade partner. Last year, bilateral trade between the two countries touched US$245.6 billion, which was an 18.5% growth year-on-year. About 25% of South Korea's exports were targeted at China. Amidst growing bilateral trade, only 3% of the transactions were settled using the renminbi or the won, while most were settled using the US dollar. The currency swap agreement was signed in 2011 during a visit to Seoul by China's vice premier Li Keqiang.

While the two countries have agreed to adopt the existing currency swap to boost the use of local currencies in bilateral trade settlements, Taiwan is the only economy among Asia's Four Little Dragons that has not signed a currency swap agreement with China yet. This could mount pricing pressure on Taiwanese companies exporting to China.

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Indonesia’s Global Ranking Drops in Latest Corruption Index

Jakarta Globe, Ethan Harfenist & Erwida Maulia, December 05, 2012

Students demonstrate in front of the Corruption Eradication Commission (KPK)
 office in Jakarta on Tuesday, demanding that the antigraft body get to the bottom
of the Bank Century bailout scandal. Indonesia ranks 118th in this year's Corruption
 Perceptions Index rankings released by Transparency International this week,
dropping from 100th last year. (JG Photo/Afriadi Hikmal) 

        

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Berlin-based Transparency International has released its annual Corruption Perceptions Index for 2012, with Indonesia sliding in this year’s rankings despite increased foreign investment and a bigger global profile.

Southeast Asia’s largest economy was ranked 118th out of 176 countries polled, down from 100th out of 183 the year before, and tied with Madagascar, Egypt, Ecuador and the Dominican Republic.

According to Transparency International’s website, the index “scores countries on a scale from 0 [highly corrupt] to 100 [very clean]. While no country has a perfect score, two-thirds of countries score below 50, indicating a serious corruption problem.”

Indonesia scored 32 on the scale. The anticorruption watchdog used nine surveys on the country to determine its ranking.

Transparency International Indonesia manager Franky Simanjuntak said on Wednesday that Indonesia performed worse than the Philippines this year, which ranked 105th, when it had traditionally ranked lower than Indonesia.

But Vietnam, which fared better than Indonesia last year, dropped to 123th position in the 2012 index.

Most other countries in the region, including Singapore, Malaysia and Thailand, again performed better than Indonesia, at 5th, 54th and 88th, respectively. 

Laos finished at 160th and Myanmar at 172nd.

Franky said this year’s score could not be compared with those in previous years, which used a scale from 0 to 10. Indonesia scored 3.0 in 2011.

“We use a different method now. And with this new method, starting from this year we can compare year-on-year scores,” Franky said, adding that the previous method did not actually allow comparisons of year-on-year figures.

“But with the 30-something score, we can say that Indonesia remains in the cluster of countries with significant corruption problems, relative to other countries surveyed,” he added.

Denmark, Finland and New Zealand shared the 1st position in this year’s rankings, scoring 90, followed by Sweden and Singapore.

Afghanistan, North Korea and Somalia shared the bottom place, scoring 8 each.

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