Headlines

The global financial crisis has tarnished the dollar and will prompt reserve managers to diversify, but the U.S. currency will retain its dominant international role, a senior Chinese official said in remarks published on Wednesday, Reuters reported. Guan Tao from the State Administration of Foreign Exchange, which invests China's $1.95 trillion in currency reserves, likened the risk of U.S. inflation and dollar depreciation to "blocked dams" that threatened the stability of the global monetary system in the medium term.

Speculation is mounting over the state of Porsche's finances after the sports carmaker admitted that it had taken a €700 million (£615 million) loan from Volkswagen, the Guardian reported. The company said that it agreed the loan in March and still needs to borrow another €1.75 billion to help service its €9 billion debt pile. The scale of Porsche's borrowing requirements led some experts to warn that the company could be dragged down by the debt mountain built up during its audacious, but ultimately unsuccessful, attempt to seize control of Volkswagen.

The Canadian Auto Workers union, almost one month after amending its contract with Chrysler LLC, ratified a cost-saving labor agreement with General Motors Corp. yesterday to protect jobs in a probable June 1 bankruptcy, Bloomberg reported. The CAW, representing about 9,000 GM hourly workers, approved with 86 percent of the vote yesterday a deal that freezes pension payments until 2015 and pays new hires less. The United Auto Workers, GM’s U.S. union, will present a tentative labor package to plant-level leaders tomorrow in Detroit. Some locals have already scheduled votes this week.

Bankruptcy for Opel, the European unit of General Motors, remains a distinct possibility despite three offers for the unit, the German economy minister, Karl-Theodor zu Guttenberg, said in an interview published on Sunday, The New York Times reported. Though Chancellor Angela Merkel’s government is to meet on Monday to consider the bids, there is no guarantee that any will be accepted, Mr. Guttenberg was quoted as saying by Bild am Sonntag. Speaking to journalists in Berlin on Sunday, Mr.

Ailing carmaker Ssangyong Motor on Monday it will proceed with restructuring plans and push for an early sales of idle assets to secure enough funds to operate factories, launch new cars and boost liquidity, The Chosun Ilbo reported. Ssangyong will seek an additional mortgage of W330 billion (US$1=W1,251) from the Korea Development Bank and relocate the Seoul Office from Posteel Tower to the Poongrim Building nearby to save over W1 billion in rent a year.

Loss-making Dutch hotel operator Golden Tulip will file for bankruptcy for 13 hotels in the Netherlands that it directly owns and operates, Reuters reported. The decision will not affect franchised or affiliated hotels, of which there are 720 in more than 50 countries, and the affected hotels will continue to operate during the proceedings, the company said. The group owns 60 hotels directly. The unlisted hotel chain had warned earlier this year that declining occupancy rates and the cost of investing in new hotels had led to losses.

Discount retailer Not Quite Retail has entered voluntary administration, throwing in doubt the future of 400 jobs throughout Victoria, The Age reported. Ferrier Hodgson confirmed it will act as voluntary administrator for the unlisted supermarket-style chain, which sells discontinued lines or excess stock, through 26 stores across the state. The three companies in administration comprise Not Quite Right Pty Ltd, Not Quite Right Holdings Pty Ltd and Retail Holdings 90C Pty Ltd.

Two high-flying companies associated with a billion-dollar resort development in Queenstown have been put into receivership, The National Business Review reported. They are Melview (Kawarau Falls Station) Investments Ltd and Melview (Kawarau Falls Station) Development Ltd. Auckland-based Nigel Anthony McKenna is a director of both companies. Mr McKenna is reported to have pre-sold large parcels of the Queenstown project to two UK-based buyers, one a private investor who is buying a chunk for about $100 million, and another larger chunk to Blue Sky Capital for more than $300 million.

Newcastle Lumber Co. Inc., the last operating mill on the Miramichi River, Canada, has gone into receivership, ForestTalk informed Lesprom Network. The family-owned sawmill has been operating in Miramichi, New Brunswick since 1894. Over 100 workers will be affected by the shutdown, including woods contractors and mill workers at the main mill in Newcastle and the dressing facility in Boiestown.

The South African economy has gone into recession after official figures showed that it contracted an annualised 6.4% in the first three months of 2009, the BBC reported. Africa's biggest economy shrank 1.8% in the previous three months, compared with the same period a year before. The first-quarter figure was the biggest decline since 1984 and puts South Africa in its first recession since 1992. "It's far worse than we expected," said Elna Moolman, economist at Barnard Jacobs Mellet.