How much debt can an industrialized country carry before the nation’s economy and its currency bow, then break? In Japan, years of stimulus spending on expensive dams and roads have inflated the country’s gross public debt to twice the size of its $5 trillion economy — by far the highest debt-to-G.D.P. ratio in recent memory, The New York Times reported. Just paying the interest on its debt consumed a fifth of Japan’s budget for 2008, compared with debt payments that compose about a tenth of the United States budget.

There is rough news for employees at Arclin Canada with word that workers in Thunder Bay are being laid off, Net News Ledger reported. The move comes as the company continues to restructure. On July 27, 2009, Arclin announced that it reached an agreement in principle with certain of its key senior lenders on the terms of a financial restructuring to strengthen the Company’s balance sheet and enhance its financial flexibility. Under terms of the agreement, Arclin’s funded indebtedness will be reduced from US$234 million to US$60 million.

Unless government programs for the unemployed are refined, there is a danger that high jobless rates will persist beyond 2010 in advanced economies, the Organization for Economic Cooperation and Development warned on Wednesday. The international organization said that unemployment among its 30 member nations would rise to nearly 10 percent by the end of 2010, above its previous post-1970 peak of 7.5 percent during the second quarter of 1993, The New York Times reported.

China unexpectedly ratcheted up pressure on the United States in a widening trade dispute on Sunday evening, taking steps toward imposing tariffs on American exports of automotive products and chicken meat in retaliation for President Obama’s decision late Friday to levy tariffs on tires, The New York Times reported.

Shermag Inc., which is operating under court protection from creditors, said Wednesday that the Quebec Superior Court has approved the purchase of the company by Groupe Bermex Inc. for $1.25 million, The Canadian Press reported. The company said the court has also approved an interim financing deal that will see Bermex contribute of up to $3 million to finance Shermag until the deal closes. Under a deal, Bermex would provide $1.25 million in exchange for nearly 41.7 million new Shermag shares, representing about 70 per cent of the issued and outstanding shares in the company.

The Nortel sale, which has emerged as a test of Canadian national economic strategy, will come under the spotlight tomorrow when MPs hold an emergency hearing on the auctioning of the bankrupt company's prized wireless equipment business, The Toronto Star reported. The scene is set for a day of tense, high-stakes exchanges as the Commons industry committee questions executives from Nortel Networks Corp. and Ericsson, the Swedish company that bid $1.13 billion (U.S.) for Nortel assets.

Arclin, a closely held maker of resins and other construction-related materials, said on Monday it filed for bankruptcy protection in Canada and the United States and that it reached an agreement in principle to restructure its debt with some of its key lenders, Reuters reported. Under the terms of the agreement, Arclin will have its debt reduced to $60 million from $234 million, the company said in a statement. A post-petition financing facility of $25 million is also part of the deal.

Lower revenue and bad debts pushed profit in the second quarter down 71 percent for Deutsche Post DHL, The Journal of Commerce reported. The world's biggest logistics company warned of tough market conditions ahead. The Bonn-based company, which ceased domestic express deliveries in the United States in January after mounting losses, forecast full year profit of $1.7 billion compared with $3.42 billion in 2008. It expects to post a net profit in 2009 thanks to cash proceeds from the sale of its banking unit, Deutsche Postbank.

Workers at the French arm of telecommunications manufacturer Nortel have threatened to blow up their factory unless they secure decent layoff terms, but gas cylinders placed around the plant were empty, the National Post reported on a Reuters story. French daily Le Parisien said on Wednesday the workers had placed gas cylinders in front of the plant in the Yvelines area near Paris, where 480 jobs are set to be axed following bankruptcy proceedings.

It may take until late fall or even early next year for a federal lifeline to begin flowing to Canada's embattled forestry companies and help them weather the impact of hefty tax subsidies to their U.S. rivals, The Globe and Mail reported. Ottawa's $1-billion fund, announced nearly a month ago, was designed to partly offset the impact of $6-billion to $8-billion (U.S.) in "black liquor" subsidies to American pulp producers.