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To: Tommaso who wrote (2028)	10/7/1998 7:20:00 PM
From: Box-By-The-Riviera™	Respond to of 3339

Wednesday October 7, 11:37 am Eastern Time China Closes Major Investment Firm BEIJING (AP) -- China's central bank has closed debt-swamped Guangdong International Trust and Investment Corp., an investment arm of southern Guangdong province, bank officials said today. The People's Bank of China is moving to transfer the debt and assets of the firm, known as Gitic, to other financial institutions, a bank official said. The official spoke on condition of anonymity. The closure appears to be part of a crackdown by financial regulators on China's trust and investment companies, which are known for running up high debts on the interbank market, where borrowers take loans from a second party to pay existing debt. Recent credit reviews indicated Gitic would not be able to repay its mounting debts. The Guangdong-based company also has had a unit listed on the Hong Kong stock exchange, Gitic Enterprises Ltd. The conglomerate reported an 89 percent drop in net profits in the first half of the year. According to Basisfield, a Hong Kong-based debt market database, Gitic has outstanding foreign currency debt totaling about $1.38 billion. Zhu Min, an economic adviser to the Bank of China's president, said Gitic was shut down to ensure that the Chinese financial sector would avoid the pitfalls Asian neighbors have stumbled into. ''I think it's a healthy development and a good thing to maintain stability,'' Zhu said. China has so far managed to prevent the regional economic turmoil from undoing its own financial system -- largely by preventing outflows of capital through the limited convertibility of its currency. However, many Chinese banks and corporations suffer from high levels of non-performing loans coupled with speculative investments. Analysts say Gitic was highly exposed to a slumping Hong Kong property market.

To: Tommaso who wrote (2028)	10/7/1998 7:29:00 PM
From: Box-By-The-Riviera™	Read Replies (1) \| Respond to of 3339

Wednesday October 7, 5:18 pm Eastern Time CSFB sees recessions in Brazil, Venezuela in 1999 MEXICO CITY, Oct 7 (Reuters) - Credit Suisse First Boston said on Wednesday it expected Brazil's gross domestic product to contract by 2.2 percent next year and Venezuela's by 2.3 percent. CSFB said in a report it expected just 0.7 percent GDP expansion in Brazil this year and 0.5 percent growth in Venezuela for 1998. For Latin America as a whole, the investment house said it expected economic expansion to slip to just 0.7 percent in 1999 after 3.0 percent growth in 1998. ''We have significantly revised our growth projections and the result is an overall cut in Latin America's contribution to global activity,'' CSFB said. ''Brazil and Venezuela will experience recessions.'' The brokers said slower growth was inevitable in 1999 to prevent a widening of current account deficits while the financing environment gets tougher. ''Thus Latin America will contribute to a deflationary cycle that threatens to engulf the global economy in the near future. Still, that reduction in growth may not be enough to maintain stability.'' CSFB said the regional current account deficit should be contained at about the same level as 1998 because of narrower trade gaps, especially in Brazil. In terms of GDP, trade deficits are expected to average 4.2 percent, with Chile and Colombia recording the widest imbalances. In addition, Credit Suisse said it expected foreign reserve growth to be minimal as most countries try to meet financing needs in an environment of substantially reduced capital inflows. However, preventive measures to seek financing from non-market sources suggested there would be no immediate credit crunch. In addition to the negative growth forecasts for Brazil and Venezuela, CSFB estimated GDP expansion in 1999 of 2.6 percent for Argentina, 2.9 percent for Chile, 2.0 percent for Colombia and 2.5 percent for Mexico.