Asia Pacific

OZ Minerals has recommended its shareholders vote in favour of its deal with China Minmetals to save it from administration, The Australian reported. Releasing documents today that outline the $US1.2 billion ($1.6 billion) asset sale, OZ chairman Barry Cusack said if the transaction were not approved, OZ Minerals might not be successful in refinancing its debt, which could potentially lead to it being unable to continue operating as a going concern and being placed into voluntary administration or receivership.

The International Monetary Fund said most Asian economies are facing a weak recovery next year from a sharp contraction this year and should boost spending to help offset struggling global export demand, The Associated Press reported. Asia's collective economic growth will likely slow to 1.3 percent this year from 5.1 percent last year, before expanding 4.3 percent in 2010, the IMF said in a report. Excluding China and India, Asian economies will contract 2.9 percent this year and grow 1.6 percent next year, the fund predicted.

Diluting Chinese savings to bail out America’s failing banks and bankrupt households, though highly beneficial to the US national interest in the short term, will destroy the dollar’s global status, the Financial Times reported. America’s policy is pushing China towards developing an alternative financial system. For the past two decades China’s entry into the global economy rested on making cheap labour available to multi-nationals and pegging the renminbi to the dollar.

Lion Nathan is keeping quiet about its exposure to the collapse of New Zealand’s biggest pub chain. A group of companies under the CEA banner went into receivership last week. CEA owns 20 bars and clubs in Wellington and the South Island. It is 50% owned by Australian resident Jugeshinder Singh; the other half is split into three tranches, all of which are owned by companies associated with Australian private equity firm Investec Wentworth. Lion Nathan supplies all of CEA's venues with either beer, wine or spirits or a combination of these.

American International Group Inc. is close to selling its Japanese headquarters for about $1 billion, in a deal that would mark one of the largest divestitures the insurance company has made to pay off its government debt, people familiar with the matter said. At least two suitors have been vying for the property, but the expected buyer is a Japanese insurance company, The Wall Street Journal reported. AIG owes the U.S. government about $45 billion as part of a rescue package that could total as much as $173.3 billion.

Efforts to create a harmonious trans-Tasman business environment have extended to company failures, with the Australian and New Zealand Governments agreeing to start work on streamlining insolvency regulations, The New Zealand Herald reported. Commerce Minister Simon Power and Australian Corporate Law Minister Nick Sherry have jointly announced a project to review cross-border insolvency procedures.

The global downturn could lead to unrest, more poverty and environmental challenges in Asia, regional leaders were warned on Monday, after they agreed on a $120 billion emergency fund to counter the crisis, Reuters reported. Asia has been hard hit by the collapse in global demand largely because of the region's heavy reliance on exports. Singapore, Hong Kong, Taiwan and Japan are in recession and growth elsewhere is the weakest in years. "Poverty is worsening in many countries. Businesses are struggling.

Most countries hammered by the financial crisis ran into trouble because their banks crumbled, their exports collapsed or they ran up too much debt. Armenia, a landlocked nation of three million in the Caucasus, has a different problem, The Wall Street Journal reported. Fiscally prudent and too isolated to be hit by early fallout from the crisis, the country is proving there is no haven from the downturn: The economy has been hit hard as Armenians who live abroad send less money home.

Austral Pacific Energy Ltd. agreed today with the group's senior secured creditor, Investec Bank (Australia) Limited, to the appointment of a receiver to Austral Pacific Energy Ltd., the publicly traded Canadian corporation, and two of its New Zealand subsidiaries, Austral Pacific Energy (NZ) Limited and Totara Energy Limited, the company announced in a press release. Investec is owed approximately US$16.8 million, which amount is now due for payment due to the expiry of the previously announced standstill arrangements.

Buyers interested in Timbercorp's assets are lining up for a bargain purchase after the agribusiness investment group was placed into voluntary administration, Stock Journal reported. And now the path could be open for investors to launch a class action against such failed timber managed investment schemes, the financial advisors who peddled them or even the Federal Government for allowing them. The Shareholders Association of Australia said there was precedent against companies who had created a misleading prospectus and poor governance.