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[waldron] 19/12/2004 09:35

Delhi Metro Opens Rail Extension, Aims to Increase Ridership Dec. 19 (Bloomberg) -- Delhi Metro Rail Corp. opens its first underground route in the Indian capital today, extending its network by almost a fifth to attract up to 7.3 million more passengers a year.

The four-kilometer (2.5 miles) extension providing service between Kashmere Gate and Delhi University is expected to carry about 20,000 riders a day, said Delhi Metro Managing Director E. Sreedharan. That brings the network to 27 kilometers at a cost of 73 billion rupees ($1.7 billion).

India is expanding the New Delhi rail system with technology from Skanska International Civil Engineering AB, Mitsubishi Corp., Alstom Transport SA and other overseas companies, as part of efforts to reduce traffic and pollution in a city where about a third of 13 million residents own cars. Vehicle sales in Asia's fourth-largest economy rose 22 percent last month.

``Any effort to build a public transportation in Delhi is a welcome relief,'' said Sunita Narain, director of the Centre for Science and Environment, a research and lobbying group that won a Supreme Court case forcing local buses and taxis to convert to natural gas fuel to cut pollution. ``This is a small step, but a great beginning nevertheless.''

The system will be extended to 70 kilometers by March 2006, Sreedharan said in an interview, raising the cost of the entire system to 106 billion rupees and estimated ridership to 2.2 million people a day. He declined to disclose the cost of the new extension.

Road Rivals

Only 130,000 people a day, or 1 percent of the New Delhi's population, now ride the city's rail network. Motorcycles, three- wheeled auto rickshaws and buses remain the most popular modes of transportation.

Some of the railway cars have been imported from South Korea's Rotem Co., while the rest have been built using technology from Bharat Earth Movers Ltd. A unit of Thales SA, Europe's biggest defense-electronics company, is supplying fare- collection systems, and signaling equipment will come from France's Alstom and Germany's Siemens AG.

Higher rail ridership may help reduce road deaths. As many as 924 people died on New Delhi roads in 2001, according to the Web site of the Delhi traffic police. ``Even if one life can be saved by the Delhi Metro, the investment that we made is worth it,'' said Sreedharan, 72, in an interview.

Still, investors and company officials says Delhi Metro isn't likely to hurt sales of cars and sport-utility vehicles in the country's biggest market for such vehicles.

``The need for personal transportation is growing,'' said Vinay Piparsania, vice president in charge of sales and marketing at the local unit of Ford Motor Co. New Delhi the unit's biggest market, accounting for a quarter of its sales.

Commute Traffic

As incomes rise and General Motors Corp. and other companies set up offices outside the city limits, more people in New Delhi will buy cars and other vehicles, Piparsania said. New Delhi's suburbs house the local units of General Electric Co., Suzuki Motor Corp., Honda Motor Co. and Coca-Cola Co.

``A bigger network is needed before automobile companies will feel the heat,'' said K.K. Mital, who manages 2 billion rupees of assets at New Delhi-based Escorts Asset Management. Among the shares his mutual funds own are Tata Motors Ltd., the nation's biggest maker of truck and bus, and Maruti, which sells one out two cars in India.

Delhi Metro, co-owned by the federal government and the Delhi state government, began operations in 2002. It's building its network with loans from the governments of India and Japan and also is advising at least six cities in India on their plans for similar systems.

The rail company charges fares of between 6 rupees and 14 rupees and also makes money leasing property it owns along its routs to companies such as McDonald's Corp.

[maywillow] 15/12/2004 16:39

Bombardier, Alstom, Siemens heads visit Israel for rolling stock tender

Israel Railways is conducting a tender for the procurement of over 80 railway cars.

Hadas Manor    15 Dec 04   16:12

Representatives of global railway manufacturers Bombardier (TSX: BBD), Alstom (NYSE, LSE, XETRA: ALS), and Siemens (NYSE: SI; XETRA: SIE) will visit Israel tomorrow at the invitation of the Israel Export and International Cooperation Institute. The railway equipment makers are seeking to extend their cooperation with Israeli firms in order to fulfill the reciprocal procurement requirement stipulated in the Israel Railways tender. Israel Railways is conducting a tender for the procurement of over 80 railway cars, with an option of bidding in another tender. Several of the global companies are also members of consortia taking part in the Tel Aviv and Jerusalem build, operate, transfer (BOT) light railway tenders.

The government plans to invest NIS 24 billion in railway infrastructure, car procurement, and accessory equipment, plus NIS 6 billion more on the Tel Aviv light railway project, by 2010.

Israel Export chairman Shraga Brosh said that agreements between the winner of the current tender and Israeli companies would yield contracts worth NIS 9 billion for Israeli industry, and create 20,000 jobs.

Bina Bar-On, director general of the Industrial Cooperation Authority, which is responsible for reciprocal procurement, told "Globes", "This is the first time that Israel Railways has required in a tender, at the insistence of the Industrial Cooperation Authority, the submitting of a reciprocal plan that we have approved, as a condition for signing the final contract."

Up until now, government contracts used the phrase "best effort" with regard to reciprocal procurement from Israeli industry.

Published by Globes [online], Israel business news - www.globes.co.il - on December 15, 2004



window.top.document.title = 'Globes [online] - Bombardier, Alstom, Siemens heads visit Israel for rolling stock tender';

[bullishbuyer 100] 09/12/2004 08:46

I read your comments and think of this.

[maywillow] 09/12/2004 07:57

13/01/05 Third Quarter Orders and Sales 2004/2005

[ariane] 03/12/2004 09:13

FRANKFURT (AFX) - Deutsche Bahn AG wants to delay 420 mln eur in payments
for new trains to Siemens AG, Bombardier Inc, Alstom SA until it is certain they
function properly, the Suddeutsche Zeitung reported, citing the German state
rail company's chief executive Hartmut Mehdorn.

The three companies have agreed to deliver 28 InterCityExpress high-speed
trains this month, the newspaper said in an article to appear tomorrow.

It also provided a breakdown of the total order. Siemens will receive 256
mln eur, Bombardier 101 mln eur and Alstom 63 mln.

[e-mail]

amk/wf

[ariane] 18/11/2004 19:45

PARIS (AFX) - Alstom SA chief executive officer Patrick Kron said the French
engineering company may be willing to take part in the potential tie-up between
Thales SA and French state-owned shipyards Direction des Constructions Navales
(DCN).
"We co-operate with DCN and with Thales on specific projects. I hope that
one day we will be able to go further," he told French daily La Tribune in an
interview to appear tomorrow.
Although DCN does not consider a tie-up with Alstom to be on the cards,
"that can change" Kron said.
The French government hopes to consolidate the position of the country's
shipbuilding industry by merging DCN with other naval companies, such as Thales
or Alstom.
[e-mail]
mw/sr/lam

[ariane] 18/11/2004 19:45

PARIS (AFX) - Alstom SA chief executive officer Patrick Kron said the French
engineering company may be willing to take part in the potential tie-up between
Thales SA and French state-owned shipyards Direction des Constructions Navales
(DCN).
"We co-operate with DCN and with Thales on specific projects. I hope that
one day we will be able to go further," he told French daily La Tribune in an
interview to appear tomorrow.
Although DCN does not consider a tie-up with Alstom to be on the cards,
"that can change" Kron said.
The French government hopes to consolidate the position of the country's
shipbuilding industry by merging DCN with other naval companies, such as Thales
or Alstom.
[e-mail]
mw/sr/lam

[waldron] 18/11/2004 15:42

French group Alstom cuts first-half net loss almost in half

43 minutes ago Business - AFP



PARIS (AFP) - Alstom, which built the Queen Mary 2 cruise liner and TGV high-speed trains and is a leading maker of power generation equipment, said it has slashed losses and pulled in orders only six months after completing rescue refinancing.



The struggling French engineering group cheered investors with first-half results that saw net loss cut almost in half and orders increase by 51 percent.


The company was rescued with state-orchestrated help last year and signed refinancing agreements with banks in May this year. EU competition authorities approved those arrangements in July and the company raised 1.75 billion euros (2.28 billion dollars) in August through capital increases.


Alstom shares, which have lost 32 percent since the beginning of the year, jumped by 7.69 percent to 0.56 euros after the company posted a net loss of 315 million euros in the first six months of its 2004-2005 fiscal year.


That was just less than half the loss of 624 million euros for the same period 12 months ago and in line with analysts forecasts that ranged between 245-427 million euros.


"The half-year results are very encouraging. The group is definitively on the path to recovery," chief executive Patrick Kron said on a conference call, adding, however, "it's obvious that it won't happen overnight".


Alstom began sinking into crisis several years ago while it was in the process of completing the Queen Mary 2 cruise liner at its shipyards.


Its problems arose partly from a slump in the cruise liner business after the attacks in the United States on September 11, 2001.


After selling some key assets, Alstom undertook a refinancing operation early this year that included agreements with banks and a 1.75-billion-euro capital increase through which the French state take a 21.4-percent stake in the company.


However, the state's involvement raised deep competition concerns among Brussels regulators who allowed the refinancing to go through only on condition that the company seek industrial tie-ups within four years.


Meanwhile, new orders have begun to pour in and the company's prospects have brightened.


The results on Thursday showed that Alstom orders jumped by 51 percent to 8.36 billion euros on a comparable basis, and by 12 percent in nominal terms.


Alstom chairman Patrick Kron said the company experienced a "strong rebound in orders across our sectors, despite continuing difficult market conditions in new power equipment, thus confirming the return of customer confidence".


He said that the group expected to win a contract worth 700 million euros by the end of the year to equip and maintain a power station in Thailand.


Kron also said that he had asked the French AMF financial market authority to look into the publication on Monday of a 50-page analysis of Alstom's prospects by a Deutsche Bank analyst which sparked a 18.64-percent fall in the price of the company's shares.


Kron said he had asked the AMF to determine whether the way the report had been published was in line with best practice.


The results released Thursday showed that group debt fell to 2.4 billion euros at the end of September from 3.7 billion in April.





It reiterated its operating margin target of six percent by March 2006 after rai sing it to 3.6 percent in the first half from 1.5 percent a year earlier.

Analysts had forecast operating margin of 3.3-3.4 percent and a net loss of 245-427 million euros.

First-half sales fell 28 percent to 6.4 billion euros, and the group said full-year sales would be around five percent lower on an annual basis.

Free cash flow was approximately a negative 400 million euros, but Alstom said it would be positive by March 2006.

[waldron] 18/11/2004 13:01

Falling Charges Help Alstom Narrow Losses
11.18.2004, 06:27 AM

Alstom SA, the French engineering group, narrowed its loss in its fiscal first half and said it was on course to meet key targets set out in last year's state-backed rescue plan.

The maker of power plant equipment and TGV high-speed trains said net loss fell to euro315 million (US$410 million) in April through September from euro624 million in the same period of 2003.

Chairman and CEO Patrick Kron said the group's financial situation was now stable, after fierce restructuring and three infusions of capital in four years.

"The problems of the past few years are now behind us, things are moving ahead," Kron said.

The company blamed a "past slowdown of order intake" for a 28 percent drop in sales to euro6.40 billion (US$8.34 billion) from euro8.85 billion. Excluding acquisitions, selloffs and currency effects, Alstom said sales fell 12 percent.

New orders, meanwhile, rose more than 12 percent to euro8.36 billion (US$10.89 billion), including an 18 percent jump at the power turbo-systems and power environment divisions.

Alstom shares were 7.7 percent higher at euro0.56 (US$0.73) in late-morning Paris trading.

Like many French companies, Alstom does not publish separate earnings figures for its first and third quarters.

Alstom's rescue plan, under which the state became its leading shareholder with a 21 percent stake, calls for the company to lift its operating profit margin to between 3.5 percent and 4 percent in the year to next March, and to 6 percent the following year.

The company, which hemorrhaged cash for years as it paid penalties on faulty gas turbines it acquired in the late 1990s from ABB Ltd., said it still projects a return to positive free cash flow by March 2006.

In the first half, free cash flow - closely watched by analysts concerned as an indicator of Alstom's ability to repay its euro2.4 billion (US$3.13 billion) in net debt - was a negative euro294 million (US$383 million). The company forecasts negative free cash flow of euro400 million (US$521 million) in the year to March 2005.

Alstom has sold off large swaths of its business and cut thousands of jobs to stay in business. It must still find euro1.5 billion (US$2.0 billion) in asset sales to comply with conditions imposed by the European Commission.

[waldron] 18/11/2004 11:39

PARIS (AFX) - Alstom SA chief executive officer Patrick Kron said he expects
the company to win a contract worth 700 mln eur in Thailand for the maintenance
of a power plant by end-December.
In a conference call with analysts, Alstom CEO Patrick Kron said: "We are
about to finalise it."
Separately, Alstom has asked the French financial markets regulator AMF to
open an investigation after Deutsche Bank on Monday cut its share price target
on Alstom, which triggered a 18.64 pct fall in the stock.
"I was surprised to see this study three days ahead of the company's
first-half results," Kron said.
Deutsche Bank on Monday cut its share price target on Alstom to 0.18 eur
from 0.35 eur previously warning the company faces 1.8 bln eur of debt
repayments over the next 20 months.
Alstom earlier said its operating margin rose to 3.6 pct in the first half
to September, up from 1.5 pct a year earlier, and above analyst predictions of
3.3-3.4 pct.
The company said net losses for the first half narrowed to 315 mln eur from
624 mln last year, in line with analysts' forecasts.
[e-mail]
lwl/jfr

[maywillow] 18/11/2004 07:34

(Updating with details of order book, CEO comments)
PARIS (AFX) - Alstom SA said orders received as of Sept 30 - the end of its
first half - rose 51 pct on a comparable basis from last year while the six
months operating margin rose to 3.6 pct from 1.5 pct a year earlier.
The power and transportation conglomerate's net loss for the first half
narrowed to 315 mln eur from 624 mln last year, in line with analysts'
forecasts. The operating margin was ahead of predictions of 3.3-3.4 pct.
The company reiterated its target for the full year of an operating margin
at 3.5-4 pct and negative free cash flow at about 400 mln eur.
It also said full year orders "should exceed" last year's level, while sales
should be down about 5 pct.
Sales in the first half were at 6.4 bln eur, down 28 pct from 8.854 bln last
year. The fall was 12 pct on a comparable basis, Alstom said.
Orders received were at 8.4 bln eur at Sept 30. The growth was 12 pct on an
actual basis, and 51 pct on a comparable basis. The order backlog was at 27.077
bln, flat in actual terms, but up 10 pct on a comparable basis.
The group said its book-to-bill ratio "significantly improved" to 1.3.
Chairman and CEO Patrick Kron said the company experienced a "strong rebound
in orders across our sectors (in the first half), despite continuing difficult
market conditions in new power equipment, thus confirming the return of customer
confidence."
The company also confirmed its plan for 2006, with targets of a 6 pct
operating margin and positive free cash flow by March of that year. Kron said
Alstom is "confident that these objectives can be reached."
[e-mail]
jad/jms

[maywillow] 18/11/2004 07:07

Alstom First-Half Loss Narrows to EU315 Mln as Orders Surge
Nov. 18 (Bloomberg) -- Alstom SA, the engineering company rescued by the French state, said its first-half loss narrowed after orders surged for the company's trains and power stations.

The net loss shrank to 315 million euros ($411.5 million) in the period through September from 624 million euros a year earlier, the Paris-based company said in an e-mailed statement today. Excluding disposals, orders rose 51 percent to 8.4 billion euros.

Chief Executive Patrick Kron, 51, is seeking to rebuild a company whose subway cars carry commuters in New York and whose power stations generate a fifth of the world's electricity. He raised 1.75 billion euros in August under the state-backed rescue after a fault on power turbines cost more than 4 billion euros.

``Alstom is on its way to a full financial recovery due not only to Kron's efforts but to the French government's as well,'' said Pedro Alves, who holds 12 million Alstom shares among the $110 million in assets he helps manage at Spot Gestao Financeira. He made the comment before the earnings were published.

Alstom's shares fell a total of 20 percent Nov. 15 and 16 after Deutsche Bank AG said the company lacks funds to repay debt. They've lost 98 percent of their value since June 1998.

A loss of 370 million euros was the median estimate of eight analysts surveyed by Bloomberg News.

[grupo guitarlumber] 15/11/2004 16:40

LONDON, November 15 (newratings.com) – Analyst Andrew Carter of Deutsche Bank reiterates his "sell" rating on Alstom (AOM.FSE). The price target has been reduced from €0.35 to €0.18.


In a research note published this morning, the analyst mentions that the company is likely to post disappointing H1 results on November 18. The analyst expresses his concern regarding Alstom's ability to repay its debts worth €1.8 billion within 20 months, given the lack of sufficient cash and long-term funding.

[grupo guitarlumber] 15/11/2004 12:23

PARIS (AFX) - Shares were flat in midday trade, as investors elected to
consolidate recent gains amid a lack of major corporate news, dealers said.
At 12.43 am, the CAC-40 was up 2.74 points at 3,837.85 in volume of 1.076
bln eur. The benchmark index and prices for the CAC-40 stocks were unavailable
between 10.33 and 10.50 am due to technical problems, Euronext said.
Volume is expected to remain thin with the market entering a consolidation
period after the benchmark index on Friday reached highest closing level since
July 8, 2002.
"We've seen steady gains over the last few weeks and it looks like the
market has now entered a consolidation phase which could continue tomorrow," one
Paris-based dealer said.
Thales was down 0.26 eur at 33.03 eur on some profit taking after the
company denied it will hold a board meeting in order to discuss "any form of
linkage with EADS".
EADS was down 0.27 eur at 24.34 eur, continuing Friday's losses when a
report in les Echos claimed the French finance ministry is orchestrating a
merger between EADS and Thales.
Fortis Bank analyst Stephane Houri reiterated its 'hold' rating on Thales
with a share price target of 35 eur.
"Where there's smoke there's fire. Although the complementary aspects are
easier to identify than on the Snecma/Sagem deal, they can hardly be considered
synergies," said Houri.
Alcatel was up 0.06 eur at 11.88 eur. The company has been the subject of
speculation it wants to sell its 9.5 pct stake in Thales.
Among other technology stocks, Capgemini was down 0.36 eur at 23.56 eur,
Thomson fell 0.35 eur to 18.19 eur and STMicroelectronics rose 0.09 eur to 15.83
eur.
Arcelor was down 0.05 eur at 16.05 eur succumbing to profit taking after the
company reported higher-than-expected third quarter results accompanied by an
upbeat outlook.
"The company reported excellent results," said Natexis Bleichroder analyst
Thierry Lefrancois, noting the company's results were well ahead of his
forecasts and market consensus.
Bouygues was up 0.31 eur at 33.41 eur as investors welcomed news that the
company is in exclusive talks to sell its Saur water unit to the French
investment fund company PAI Partners for about 1.037 bln eur, dealers said.
Outside the main index, Alstom dropped 0.07 eur or 11.86 pct to 0.52 eur
after ahead of the company's first-half results later this week, with Deutsche
Bank reiterating its 'sell' rating on the stock and cutting its share price
target on the stock to 0.18 eur.
"Alstom faces 1.8 bln eur of debt repayments within 20 months and has
neither the cash nor the committed funding despite August's successful
re-capitalization," Deutsche Bank said in a note to clients.
[e-mail]
lwl/pav/

[ariane] 12/11/2004 07:08

PARIS (AFX) - The European Aeronautic, Defence and Space Co NV (EADS) will
soon launch a bid to acquire Thales SA in a deal being orchestrated by the
French government, which owns just over 15 pct of EADS and a 31 pct stake in
Thales, according to a report in French daily Les Echos.
The new entity will have annual sales of about 40 bln eur and be present in
all sectors of the aviation industry, the newspaper said.
It said that as part of the deal, Alcatel and Dassault Aviation will sell
their minority stakes in Thales. Alcatel holds 9.5 pct of Thales and Dassault
Aviation owns 5.7 pct.
Thales meanwhile will sell its Communication business to Alcatel while
Dassault will acquire Thales' Airborne Systems division.
Financial terms of the takeover offer were not disclosed.
[e-mail]
js/ma

[waldron] 11/11/2004 14:17

France May Raise EU3.5 Billion in Nuclear Power IPO, People Say
Nov. 10 (Bloomberg) -- France plans to sell more than a third of Areva SA, the world's biggest maker of nuclear reactors, raising about 3.5 billion euros ($4.5 billion) in an initial public offering, according to people familiar with the matter.

Finance Minister Nicolas Sarkozy may sell as much as 35 percent of Paris-based Areva, said the people, who declined to be identified. Non-voting investment certificates that are already publicly traded value Areva at 10.2 billion euros. Each certificate would be exchanged for one share, one of the people said. The government may announce the plan as early as today.

Sarkozy, who will leave the government at the end of the month, has raised more than $8 billion this year selling shares in state-controlled companies including Snecma SA, the world's third- largest maker of commercial aircraft engines, to help improve state finances. The Areva sale, slated for as early as March, would tap rising demand for nuclear power amid record oil prices.

``There is strong demand for nuclear power now because of oil costs and because of rising energy demand,'' said Xavier Debeugny, who manages $130 million for private clients at Oddo & Cie. in Paris. ``France can meet that demand with Areva because it has been serious about security and has invested in nuclear power for 30 years, since the last time oil prices soared.''

The government hired Toulouse & Associes to help advise it on options for Areva, one of the people said. The advisory boutique was founded by Jean-Baptiste Toulouse, a former banker at Lehman Brothers Holdings, Inc. in New York, Rothschild & Cie. in Paris and UBS Warburg in Paris. In September, it hired Jean Peyrelevade, the former chairman of Credit Lyonnais SA as a senior partner.

Charles Hufnagel, an Areva spokesman, declined to comment, as did a spokesman for the French finance ministry. Toulouse, based in Paris, didn't return calls by Bloomberg News for comment.

Framatome, Cogema

Named after a Cistercian abbey and created in September 2001, Areva is France's holding company for the nuclear industry. The company's Framatome division, a venture with Siemens AG, is the world's biggest maker of nuclear reactor and its Cogema unit is among the biggest producers of nuclear fuel.

Areva said Nov. 4 that third-quarter sales surged 38 percent to 2.39 billion euros, partly boosted by the acquisition of Alstom SA's power-networks business. It didn't release quarterly earnings. In the first half, net income quadrupled to 243 million euros and sales rose 29 percent to 5.34 billion euros.

Sarkozy, who will leave his government to run France's governing party, has pledged to lower government debt that has reached a record 63.7 percent of gross domestic product after almost 30 years of accumulated deficits. Revenue of share sales can't be used to reduce deficits under European Union rules. They can be used to reduce debt and to pay for other projects.

Oil Surge

Nuclear power demand is rising amid soaring oil prices. Crude oil prices last month surged to $55.67 a barrel in New York, the highest in more than two decades of futures trading, as concern mounted that supplies may be disrupted as energy demand surged. Increasing energy costs have hurt global economic growth.

Futures for crude oil on the New York Mercantile Exchange have fallen 15 percent from an Oct. 25 record of $55.67 a barrel, and were trading at $47.05 at 9:06 a.m. London time.

The governments of China and India both said in September their growing energy needs will in part be met with nuclear power.

China is preparing to award an $8 billion contract to build four new reactors, the first of 27 that will be needed over the next 15 years to meet the country's stated target of raising nuclear energy output to 36 gigawatts from 9 gigawatts today.

India plans to triple its nuclear power capacity by 2012 to 10 gigawatts, and is aiming for output of 20 gigawatts by 2020 from 3 today, which means 17 new reactors, Power Minister P.M. Sayeed said at the world Energy Congress in Sydney in September.

European Revival

Finland ordered a $3.7 billion, 1,600 megawatt reactor from a joint venture between Areva and Munich-based Siemens AG in December, the first such order in Western Europe since the Chernobyl disaster. The plant will come on line in 2009.

In the U.S., President George W. Bush's 2001 energy plan calls for increased use of nuclear power. The Department of Energy will share the expected $500 million cost of gaining approval for new reactors, the Wall Street Journal said yesterday.

Areva Chief Executive Officer Anne Lauvergeon, 45, said at a Paris press conference in March that the group was ready for a share sale if and when the government decided to go ahead.

Currently, less than 5 percent of Areva trades on the Paris bourse as non-voting investment certificates. Those certificates fell as much as 3.7 euros, or 1.3 percent, to 285.1 euros and traded at 287 euros at 12:43 p.m. in Paris.

Areva signed an agreement a year ago with Urenco Ltd., a uranium-processing company established by the U.K., Germany and the Netherlands in 1971, to buy half of the latter company's Enrichment Technology Co. unit for 3 billion euros. This will allow Areva to design and build centrifuge equipment to produce enriched uranium and will replace the gas diffusion plant it uses.

The Wall Street Journal and the French newspapers Les Echos and La Tribune reported the possible sale earlier today. They cited people familiar the situation they didn't identify.

[grupo guitarlumber] 11/11/2004 09:49

Sarkozy defends French backing for Alstom

Mark Milner
Wednesday November 10, 2004
The Guardian

CBI director general Digby Jones yesterday clashed with French finance minister Nicolas Sarkozy over the state-backed rescue of one of France's biggest industrial companies.
Mr Jones challenged Mr Sarkozy to justify his espousal of economic reform alongside the use of taxpayers' money to bail out engineering group Alstom, in a move which Mr Jones said meant the French group's rivals were "competing on a different playing field".

In a robust response, Mr Sarkozy said he was not ashamed of what he had done to rescue Alstom last year. "I believe that in a major country you can't have only theme parks and banks. The question of an industrial policy for Europe is a fundamental issue. If the state had not been prepared to become involved, Airbus would not now exist, [space rocket maker] Ariane would not now exist. All I did was provide Alstom with the means to recover. We are talking about 75,000 workers.

"The state has a role to provide for the future. I am a liberal but being a liberal does not mean that the finance ministry should just look on."

Later, Mr Jones said he admired Mr Sarkozy's frankness but was disappointed by what he had to say. He said the backing for Alstom had been against EU rules and should have been thrown out by the Eu ropean commission. Mr Sarkozy, he said, should accept that "when you join a club you can't pick and choose the rules".

In his main speech to the CBI conference, Mr Sarkozy, who is due to step down as finance minister later this month to take on the leadership of France's ruling centre-right party, UMP, urged Britain to move closer to Europe.

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"Europe needs Britain. You are friends with America... but you are closer to Europe. That's the reality. It's very rare for countries to change their address."

He said if the British wanted a Europe which resembled Britain more closely "you will have to take your place at the European table. You have to change things from the inside not the outside."

Mr Sarkozy, who addressed the conference in French, noted that English was spoken throughout the world and that the British economy was one of the strongest in Europe.

"Looking at Britain from the outside you are stronger than you yourselves believe."

[grupo guitarlumber] 10/11/2004 11:42

Report attacks defence spending

The Type 45 Destroyer is among the major defence projects
The Ministry of Defence has been criticised over the soaring spending costs and growing delays of its top equipment projects.
A National Audit Office report on the 20 biggest projects says costs have risen by £1.7bn in the past year.

It says there is "little evidence" the MoD's performance had improved, despite the introduction of a "smart acquisition" policy six years ago.

A senior defence official told the BBC lessons were being learned.

The NAO's annual report showed the total cost of the 20 projects covered was expected to reach £50bn - 14% higher than originally planned.

The total delays amounted to 62 months, with average individual delays rising by three months.


'Legacy projects'

Sir John Bourn, head of the NAO, said the problems showed the principles of the scheme known as smart acquisition had not been consistently applied.

"Many problems can be traced to the fact that the MoD has not spent enough time and resources in the assessment phase," the report says.

The NAO found that projects launched since the start of the scheme were showing the same worrying tendencies as the older "legacy projects", such as the Eurofighter.

A senior defence official, speaking to the BBC's defence correspondent Paul Adams, said that although the figures were still not good enough, the report reflected unrealistic expectations early on in the project cycle.

This year's overspend was significantly less than last year's £3.1bn total, and the Defence Procurement Agency - which is responsible for buying defence equipment - was improving.

'Few surprises'

Lord Bach, Minister for Defence Procurement, said he was "obviously still disappointed with the cost and time increases shown", but insisted that the Defence Procurement Agency had "undertaken a huge amount of work to expose any underlying problems on projects".

The latest findings follow a string of critical reports issued within the last 12 months, and, according to our correspondent, contain few new surprises.

Turning around the Defence Procurement Agency "was a little like trying to turn around a super tanker - it takes a very long time indeed", he said.

Our correspondent said it was the same projects, including the Joint Strike Fighter, the Nimrod and A400M aircraft and the Type 45 Destroyer, which were resonsible for the bulk of the cost over-runs and delay.

But he added some projects, such as the C-17 heavy lift aircraft and Successor Identification Friend or Foe (SIFF), were showing good performances.