Headlines

A Chinese-born Swedish investor with Japanese support has agreed to buy bankrupt automaker Saab Automobile and plans to bring it back to life as a maker of electric cars, with an initial focus on the Chinese market, Reuters reported. Saab, which has been making cars since 1947, crashed into bankruptcy at the end of 2011, less than two years after former owner General Motors sold it to Dutch group Spyker. Though an admired brand with a loyal fanbase, Saab had struggled for years to survive against bigger competitors.

Oil giant Royal Dutch Shell, fuel distribution firm Greenergy and storage company Vopak are putting together a joint bid to buy the Coryton refinery as a storage terminal, a union official said on Wednesday, Reuters reported. The union said it would fight the move, which would put the vast majority of the 900 workforce out of a job, and will step up protests to encourage the government to support a bid to keep it operational. "We're hearing it's a tripartate agreement," said Russ Ball, regional representative for Unite the Union.

Stung by the weekend agreement of a Spanish banking bailout of up to €100bn, policy makers appear to believe that the supervision of banks that pose a systemic risk to Europe should rest with a centralised European authority, rather than national regulators, the Financial Times reported. The idea is part of a broader plan, advocated by architects of the next phase of European integration, to create a “European banking union”, which would also involve a pan-European deposit guarantee scheme.

After clinching a $125 billion bailout for Spain’s banks, Prime Minister Mariano Rajoy flew to Poland on Sunday for the Spanish team’s soccer match, declaring “this matter is now resolved.” Not so fast, prime minister. On Tuesday, Spain’s long-term borrowing costs soared to their highest level since the country joined the euro zone. Investors have apparently concluded that the rescue is potentially a much better deal for the banks and their shareholders than for the government, its taxpayers and bondholders, the International Herald Tribune reported.

Government delays in reforming personal insolvency laws are a “specific source of concern” for the EU-ECB-IMF troika and could, it warned, trigger a deterioration of payment discipline. In their sixth report, seen by the Irish Times, the troika said Nama faces “challenges . . . to meet its debt redemption charges” next year, with bond targets likely to be revised downward. In addition, it warns that, despite cutbacks, “fiscal consolidation is far from complete”.

When primary-school teacher Vanessa Kuhn-Baumann opens her pay statement every month, she thinks dark thoughts about Spain and Greece. Despite the prosperity of her country, her bank statements and tax returns feel like a constant reminder of the price of European solidarity and economic unity, The Globe and Mail reported. Like all Germans, Ms. Kuhn-Baumann has a 5.5 per cent “solidarity surcharge” on top of her income tax withdrawn from her paycheques – a fee imposed in 1991 to pay for the reunification of Germany after the communist German Democratic Republic ceased to exist.

As Korea finds itself dragged into a disastrous vortex of faltering exports, collapsed consumer spending and spiraling debt, government officials appear at a loss on how to prevent the country’s fragile recovery from derailing, The Korea Times reported. But they could do much worse than starting from eliminating corruption and cronyism from the bureaucratic veins, according to a number of economists here. The subduing economy pretty much ensures that President Lee Myung-bak is going out on a whimper.

Raising the stakes in Europe's debt crisis, Austria's finance minister said Italy may need a financial rescue because of its high borrowing costs, drawing a sharp denial on Tuesday from the Italian prime minister, Reuters reported. Maria Fekter's assessment of the euro zone's third largest economy stoked investors' fears that Europe is far from ending 2-1/2 years of turmoil - a feeling reinforced by Dutch Finance Minister Jan Kees de Jager, who said the euro zone was "still far from stable".

Spain’s Treasury on Monday vowed to continue as normal with sovereign bond auctions, arguing that the eurozone’s weekend agreement on a €100bn bailout for Spanish banks would underpin the country’s debt market, the Financial Times reported. Market analysts have expressed doubts as to whether the deal to recapitalise banks with a loan injection via Spain’s state Fund for Orderly Bank Restructuring will provide lasting benefits. On Monday morning Spanish bonds rallied, but the euphoria quickly faded.

Cyprus said Monday that it urgently needed European financial aid to boost its banks' capital, a step that would make it the fifth euro-zone economy to seek help from the region's bailout funds, The Wall Street Journal reported. Cyprus Finance Minister Vassos Shiarly said the country's need for an international bailout was "exceptionally urgent" in order for it to recapitalize its banks, and that the issue would need to be resolved by the end of the month.