Global business and political economy
Two huge aquifers holding 250 billion cubic meters of water have been discovered in the arid northern region of Kenya, according to a government spokesman. Boreholes are being tested and it is hoped the first water drawn from the aquifers will be available soon. Around 40 percent of Kenyans currently have little access to fresh water.
Four men were found guilty of the fatal gang rape of a student in Delhi, the Indian capital. The attack on the 23-year-old woman last December sparked protests across India against official indifference to women’s rights and safety. The convicted men’s lawyers insist their clients were tortured and that some of their confessions were coerced. Prosecutors called for the death penalty.
The family of a former South Korean president, Chun Doo-hwan, vowed to pay back $150 million worth of corruptly obtained assets. Chun, now 82, was South Korea’s leader from 1979 to 1988, but in 1996 he was convicted of treason, corruption and mutiny. He was pardoned in 1997.
Mexico’s government presented a fiscal reform that would raise income and other taxes but, in a sop to opponents, would not extend VAT to food and medicine. The reform is aimed at increasing the tax take by about three percentage points of GDP, lessening the government’s dependence on oil revenue.
A parliamentary election in Norway saw a marked shift to the center-right. The incumbent Labor Party, headed by Jens Stoltenberg, the prime minister, won the most seats, but a surge of support for the Conservative Party will allow its leader, Erna Solberg, to head a coalition government in partnership with the right-wing Progress Party, which lost a handful of seats.
Verizon issued $49 billion in bonds, smashing the record for a sale of corporate debt. The telecoms company will use the proceeds to fund its $130 billion purchase of Vodafone’s stake in Verizon Wireless, their joint venture. Pension funds and insurance companies flocked to the sale, tempted by the higher yields Verizon offered compared with other, similar-quality bonds.
The Committee on Foreign Investment in the United States, which assesses the risks to national security from foreign takeovers, gave its approval to the $4.7 billion offer for Smithfield Foods from China’s Shuanghui. When approved by shareholders, it will be the biggest acquisition of a U.S. company by a Chinese one, and create a global beast in pork products. Some U.S. politicians have raised concerns about Chinese food-safety standards.
TSB returned to the British high street as a stand-alone bank, 18 years after being merged with Lloyds. Following its bailout by the British government, Lloyds was ordered by the European competition authority in 2009 to sell off assets in retail banking. TSB has been rebranded and is handling the accounts of 5 million customers moved over from Lloyds. Lloyds will float TSB on the stock market next year.
Japan’s economy grew at a much faster rate in the second quarter than had been thought, because of more corporate and public investment. A revised estimate put the pace of growth at 3.8% at an annual rate, up from the 2.6% initially reported.
Suntory, a Japanese company that sells a range of alcoholic and soft drinks, agreed to buy the Lucozade energy-drink and Ribena fruit-juice brands from GlaxoSmithKline, a British drug company, for $2.1 billion. Both beverages are popular in Britain and elsewhere, and were marketed from the 1920s to the 1980s as aids to boosting health (Ribena) or recovery from sickness (Lucozade).