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ARGENTINE GOVERNMENT TO SEEK STATE OF SIEGE

The Argentine government will ask congress to declare a state of siege following a rebellion by army officers objecting to human rights trials, official sources said. Earlier, Army Chief of Staff Hector Rios Erenu said he would use all the means at his disposal to put down the rebellion. He relieved from their commands two colonels, one of them at an airborne infantry regiment in Cordoba, centre of the uprising. Argentine Army Chief of Staff Hector Rios Erenu said he would begin moving troops for a possible military operation to put down the almost three-day old rebellion. Interior Minister Antonio Troccoli said the government would seek parliamentary approval of the state of siege "unless there is something unexpected that justifies more urgent treatment." Reuter 

ZIMBABWE UNITY TALKS OFF, MUGABE SAYS

Prime Minister Robert Mugabe of Zimbabwe said he suspended key talks to unite his ruling ZANU-PF party and opposition PF-ZAPU party. "I am sorry to say we have been deadlocked for too long on the question of unity, and the central committee of my party has recently decided that the talks be discontinued for they are serving no purpose," he said in a nationwide radio-and-television address. The collapse of the unity talks, widely expected to have heralded creation of a socialist, one-party state, was a major setback for the government, diplomats said. Reuter 

WHITE HOUSE SAYS U.S. MONETARY POLICY CORRECT

The White House, distancing itself from remarks by the administration's budget chief, said the Federal Reserve's current course of monetary policy was appropriate. "The administration feels that the current course of monetary policy is appropriate," White House spokesman Marlin Fitwater said. Fitzwater said the administration did not endorse remarks by White House budget chief James Miller, who said he was concerned the Federal Reserve might overreact to the decline in the value of the U.S. dollar by raising interest rates. More 

BANKS TRY TO CALM MANILA'S FURY OVER DEBT DEAL

Senior U.S. bankers are seeking to calm the furore in the Philippines caused by the terms of Argentina's new financing package, but a source in New York close to the Manila government said finance minister Jaime Ongpin is in no mood for compromise. Ongpin is angry because the banks granted Argentina an interest rate spread of 13/16 pct, the same as Mexico won, just weeks after telling the Philippines that it must accept 7/8 pct because the Mexican margin could never be repeated. Bankers acknowledged the political sensitivity of the interest spread but urged Ongpin to examine the Argentine package in its entirety. Argentina, for instance, is offering banks a 3/8 pct participation fee if they sign up for the deal within 30 days (declining to 1/8 pct if banks commit within 60 days), which boosts the all-in interest rate it is paying on the package. "You can make the case that the deal is not 13/16 pct," one banker said. Another, referring to the Philippine debt negotiators, said "The only reason they'd have to come back to New York is political, not economic." Ongpin has said as much himself, estimating that an extra 1/16 percentage point would cost just 5.1 mln dlrs a year. But the source close to the Philippines said Ongpin's anger goes beyond the dollars. He said the minister feels personally betrayed by bankers who insisted Mexico's 13/16 pct was a rock-bottom spread that could not be duplicated. Top U.S. Treasury and Federal Reserve officials had said the same. The source said Ongpin is unlikely to come to the U.S. to press his case and was expecting the Philippines' bank advisory committee, headed by Manufacturers Hanover Trust Co, to negotiate the spread reduction by telex. Ongpin has not said the Philippines will unilaterally start paying interest at the lower rate but has made it clear to the committee in a telex that he is not prepared to pay more than Mexico and Argentina, the source said. "The Philippines really means business on this. I don't think there's much room for compromise," he said. Manufacturers Hanover declined to comment on the issue. The Philippines last month won an agreement to reschedule 10.3 billion dlrs of debt over 17 years at an interest rate of 7/8 pct, whereas some 30 billion dlrs in old Argentine debt will be stretched out over 19 years with a spread of 13/16 pct. Bankers said they were forced to break their word because political circumstances had changed in the past few weeks. In particular, they said it had become clear that Argentina was serious about its threat to suspend interest payments unless it got a good deal. Fearing that an Argentine moratorium would stiffen the resolve of its neighbour Brazil, which has already suspended payments, the banks, at the urging of the Reagan Administration, bowed to Argentina's demands. Some U.S. bankers argued that, regardless of politics, the rich menu of options in the Argentine package makes it attractive enough to justify a 13/16 pct rescheduling rate. "When they (the Philippines) see the whole package, they may realize that this is not a Mexican deal," one banker said of the Argentine agreement. The Argentine pact contains several features that were not in the Mexican accord such as "exit bonds," an option to provide new money via bearer bonds, a trade facility, onlending provisions and a debt-equity conversion scheme. Moreover, Argentina is requesting only 1.95 billion dlrs in new loans, compared with Mexico's 7.7 billion, and is paying 7/8 pct for most of the money instead of the 13/16 pct charged to Mexico. This line of argument cuts no ice with the Filipinos, who note drily that they asked for no new money at all. "The banks reacted on the level of politics to Argentina and try to justify it in terms of economics, and now they're going to have problems with both the Philippines and Venezuela," said the source close to the Manila government. Because of the Easter holidays bankers have not yet got an official reaction from Venezuela, which is also paying 7/8 pct on its 20.2 billion dlr rescheduling. But they acknowledged that Caracas, which was also told that the Mexico spread was inviolate, is quite likely to demand a lower spread. Bankers were more sanguine in the case of Chile. Because it is under fire for its human-rights record, the government of General Augusto Pinochet is unlikely to attract attention to itself by seeking to renegotiate its recent debt package, which carries interest of one pct, bankers said. They hope that, once tempers cool, the Philippines will also accept that reopening an agreement that took 4-1/2 tough months to negotiate will be more trouble than it is worth. Reuter 

GULF AND WESTERN <GW> RESPONDS TO VALVE SUIT

Gulf and Western Inc <GW> said it believes it has no liability under an earlier reported lawsuit seeking 500 mln dlrs in damages against it and two other companies. The suit, filed by Niagara Mohawk Power Corp and other owners of the Nine Mile Point Two nuclear plant, concerns the design and fabrication of the ball valve system for the facility. "Niagara Mohawk appears to be trying to shift their responsibilities in connection with the construction of the Nine Mile Point Two plant to others," Gulf and Western said. Gulf and Western said it has not yet seen the lawsuit. The company said a subsidiary no longer owned by it sold the valves in question in 1977. Since then, the valves have been subject to substantial modifications by others, it said. Reuter 

FORMER BALDWIN-UNITED CHIEF SETTLES SEC CHARGE

The former chief executive officer of Baldwin-United Corp, now known as PHLCorp <PHX>, agreed to settle charges stemming from misleading financial statements the company is accused of making before it collapsed in 1983. Under the settlement with the Securities and Exchange Commission, former Baldwin-United President Morley Thompson agreed to an order issued by the U.S. District Court in Cincinnati, Ohio, barring him from committing further securities law violations. Thompson did not admit or deny the charges. Although Thompson was the last of several defendants to settle charges brought by the SEC on September 26, 1985 in connection with the Baldwin-United case, the agency said it is continuing to investigate other matters related to the company and may bring charges against other people. Baldwin-United, a Cincinnati-based diversified financial services holding company, went bankrupt in September 1983. It changed its name last November to PHLCorp. The SEC said Thompson violated reporting and anti-fraud provisions of federal securities laws in late 1982 by issuing misleading press releases. Baldwin-United, which has already settled SEC charges brought against it, made "false statements concerning the financing for two corporate acquisitions," the SEC said. The statements indicated that the company had available cash for the takeovers while it was actually facing a "serious cash flow crisis," it said. The company was also accused of filing false and misleading financial statements with the SEC. Reuter 

WHITE HOUSE LISTS TARIFFS ON JAPANESE GOODS

The White House issued a list of Japanese exports to covered by the 100 pct tariffs imposed by President Reagan. - Automatic data processing machines (1986 imports worth 180 mln dlrs), including certain desk and lap models with microprocessor-based calculating mechanism capable of handling words of at least 16-bits off the microprocessor; - Complete color television sets, with 18, 19 or 20 inch screens (1986 imports 90 mln dlrs); - Power tools, including certain drills, percussion hammers, sanders, polishers, grinders. Reuter 

U.S. BUSINESS LOANS FALL 1.08 BILLION DLRS

Business loans on the books of major U.S. banks, excluding acceptances, fell 1.08 billion dlrs to 276.37 billion dlrs in the week ended April 8, the Federal Reserve Board said. The Fed said that business loans including acceptances fell 1.1 billion dlrs to 278.67 billion dlrs. Reuter 

COMMUNICATIONS SATELLITE CORP <CQ> 1ST QTR NET

shr 46 cts vs 76 cts div 30 cts vs 30 cts prior net 8.5 mln vs 14.0 mln NOTE: 1987 qtr net is after a 5.5 mln dlr reserve for a potential refund as a result of the Federal Communications Commission's continuing rate investigation. company said it believes any refunds it may have to make would not materially affect its financial position. Reuter 

AMERICAN MANAGEMENT SYSTEMS <AMSY.O> 1ST QTR NET

shr 21 cts vs 18 cts net 1,068,000 vs 902,000 revs 38.1 mln vs 29.7 mln avg shrs 5,177,000 vs 5,120,000 NOTE: shr reflects 2-for-1 stock split on June 9, 1986 Reuter 

HYTEK MICROSYSTEMS INC <HTEK.O> 1ST QTR LOSS

shr loss 17 cts vs loss 14 cts net loss 467,000 vs loss 400,000 revs 3,856,000 vs 3,423,000 avg shrs 2,821,000 vs 2,797,000 Reuter 

TVI CORP <TVIE.O> YEAR 1986 LOSS

shr loss 38 cts vs profit two cts net loss 2,254,533 vs profit 106,621 revs 3,430,970 vs 4,104,506 Reuter 

RIGGS NATIONAL CORP <RIGS.O> 1ST QTR NET

shr 73 cts vs 1.03 dlrs net 10,245,000 vs 12,364,000 avg shrs 13,981,024 vs 11,968,524 assets 6.07 billion vs 5.22 billion loans 2.92 billion vs 2.45 billion deposits 4.78 billion vs 4.14 billion NOTE: gain from sale of securities 4.6 mln vs 12.8 mln. loan loss provision 100,000 dlrs vs 7.7 mln Reuter 

FINLAND FILES FOR 550 MLN DLR DEBT OFFERING

The Republic of Finland filed with the Securities and Exchange Commission for a shelf offering of up to 550 mln dlrs of debt securities, including notes and bonds, and/or warrants to buy debt securities on terms to be determined at the time of the sale. The offering is in addition to 50 mln dlrs of debt securities already registered with the SEC but unsold. Proceeds from the sale will be used to finance capital investment and the promotion of productive investments and exports designed to strengthen the country's balance of payments, the government said. No underwriter was named. Reuter 

GRUMMAN CORP <GQ> GETS 77 MLN DLR NAVY CONTRACT

Grumman Aerospace Corp is being awarded a 77 mln dlr increment to a Navy contract related to fiscal 1988 A-6F aircraft production, the Defense Department said. It said work on the contract is expected to be completed in October 1990. Reuter 

NORTHWEST NATURAL GAS CO <NWNG.O> 1ST QTR NET

shr 1.35 dlrs vs 1.27 dlrs div 39 cts vs 39 cts prior net 14,291,000 vs 13,211,000 revs 52.6 mln vs 51.1 mln avg shrs 10,234,000 vs 9,936,000 Reuter 

KENTUCKY CENTRAL <KENCA.O> UNIT SELLS STATIONS

Kentucky Central Life Insurance Co said its Bluegrass Broadcasting Co Inc subsidiary has agreed to sell two Orlando, Fla., radio stations to TK Communications Inc for 13.5 mln dlrs, subject to FCC approval. Reuter 

KIMBARK OIL AND GAS CO <KIMB.O> 1986 YEAR LOSS

shr loss 57 cts vs loss 2.88 dlrs net loss 3,442,000 vs loss 13,750,000 Reuter 

PROPOSED OFFERINGS RECENTLY FILED WITH THE SEC

The following proposed securities offerings were filed recently with the Securities and Exchange Commission: General Instrument Corp <GRL> - Offering of 150 mln dlrs of convertible subordinated debentures due 2012 through an underwriting group led by Lazard Freres and Co Dillard Department Stores Inc <DDSA> - Shelf offering of up to 100 mln dlrs of debt securities, including debentures and notes, and a shelf offering of another 100 mln dlrs of debt securities by its Dillard Investment Co Inc subsidiary, both through Goldman, Sachs and Co. Sara Lee Corp <SLE> - Shelf offering of up to 1.0 mln shares of common stock through Morgan Stanley and Co Inc and Goldman, Sachs and Co. Reuter 

TRACOR INC <TRR> GETS 60.1 MLN DLR NA

Tracor Applied Sciences, a division of Tracor Inc, is being awarded a 60.1 mln dlr contract for the design and development of Radio Communication Suites for the Aegis CG-60 through CG-70 ships, the Defense Department said. It said work on the contract is expected to be completed in 1992. Reuter 

SOUTHERN NATIONAL CORP <SNAT.O> 1ST QTR NET

shr 47 cts vs 46 cts net 3,470,859 vs 3,454,577 Reuter 

FIRST BANK SYSTEM <FBS> SELLS LEWISTON BANK

First Bank System said it has agreeed to sell its First Bank Lewiston subsidiary, of Lewiston, Mont., to two local bankers for undisclosed terms. First Bank Lewiston has assets of 101.4 mln dlrs at the end of the first quarter. Reuter 

ICN <ICN> HAS FIVE PCT OF SYNCOR <SCOR.O>

ICN Pharmaceuticals Inc told the Securities and Exchange Commission it has acquired 556,500 shares of Syncor International Corp, or 5.0 pct of the total outstanding common stock. ICN said it bought the stake for 3.9 mln dlrs as an investment and has no plans to seek control of the company or to participate in the management of it. Reuter 

JAPAN SAYS IT IS DISAPPOINTED WITH TARIFFS

The Japanese Embassy said in a statement it was "deeply disappointed" by the tariffs announced by President Reagan in retaliation for Japan's not honoring its semiconductor agreement with the United States. It said Japan had been fully implementing the pact to end dumping semiconductors in world markets and to open its home market to U.S. goods and the results were starting to show. The embassy said Japan would complain to the General Agreement on Tariffs and Trade, as it said it would, and seek new talks with Washington to resolve the issue as soon as possible. Reuter 

DIXONS EXPLORING SALE OF CYCLOPS <CYL> UNIT

Dixons Group Plc <DXNS.L>, the British concern that recently acquired operational control of Cyclops Corp, said it is exploring the possibility of selling the Cyclops subsidiary, Busy Beaver Building Centers Inc. In a filing with the Securities and Exchange Commission, Dixons said it has determined to explore the possibility of the sale following its preliminary review of the business and activities of Cyclops. Busy Beaver Building Centers is a Pittsburgh, Pa., lumber and building materials company. Dixons won control of Cyclops with a 95 dlr a share tender offer. Reuter 

JAPANESE TARIFFS SEEN AS WORLDWIDE WARNING

The tough trade sanctions President Reagan imposed on Japanese exports are not only a shot across Japan's bow but also a sign Reagan will attack unfair trade practices worldwide, U.S. officials said. But Robert Crandall, a trade specialist at Brookings Institution, a think tank, said "a shot across their bow can often result in a shot in our stern." He said it left the United States open to retaliation. The U.S. officials said the 100 pct tariffs Reagan ordered on 300 mln dlrs worth of Japanese goods will also show Congress that a tough pro-trade stand can be taken under existing laws, and no new protectionist legislation is needed. In the past year tough trade action had been taken against the European Community over corn and sorghum, Taiwan over beer and wine, South Korea over counterfeiting of copyrights, patents and trademarkets and Japan on tobacco. White House spokesman Marlin Fitzwater told reporters the tariffs - up from five pct - should be seen as a "serious signal" to other nations on the need for fair trade practices. Reagan said he imposed the sanctions on certain computers, television sets and some hand tools because Japan did not honor an agreement to end dumping semiconductors in world markets at less than cost and to open its markets to U.S. products. The tariffs were placed on items which were available from other sources so there would be little effect on the American consumer, Fitzwater said. Reagan has come under heavy pressure to take tougher action - especially against Japan - to end global unfair trade practices and reverse the growing U.S. trade deficit. The alternative was that if he did not, Congress would. The U.S. trade gap last year was a record 169.8 billion dlrs, and continues to rise, with Japan accounting for about one-third of America's overall deficit. But there are other two-way deficits - with Canada, West Germany, Taiwan and South Korea - and Reagan officials said the president is ready to fight them all. Reagan said in announcing the sanctions today that "I regret that these actions are necessary," but that the health and vitality of the U.S. semiconductor industry was essential to American competitiveness in world markets. "We cannot allow it to be jeopardized by unfair trading practices," Reagan added in the statement from his California vacation home at Santa Barbara. He said the tariffs would remain in force until Japan abided by the agreement. U.S. officials say the action today will show Congress - which is about to write a trade bill he does not like - that he already has the tools needed to fight unfair trade. The White House aide said of the tariff action, "it wasn't done to appease Congress, but because there was an unfair trade practice." The aide added, however, "on another plane, it was an example of how the administration uses the trade law to fight unfair practices, an that it is not necessary to make a major overall of our trade laws." But the analyst, Crandall, said the tariff action was not in the best interests of the United States, and that negotiations should have been pursued to resolve the issue. "It's very dangerous to go down the retaliatory route," he said, "because it leads to more retaliation and restrictions in trade." Crandall said, "the administration is doing this for its political impact across the country, and therefore its impact on Congress." He said, "I don't think it makes a lot of sense." But other analysts said it made little difference whether the tariffs were aimed at U.S. trading partners or Congress, and that the main point was that the trading partners were on notice that retaliation was a weapon Reagan was ready to use. Spokesman Fitzwater said "we don't want a trade war," but the imposition of sanctions showed the United States would act when it had evidence that trade pacts were being violated. Crandall said, "the administration is doing this for its political impact across the country, and therefore its impact on Congress." He said, "I don't think it makes a lot of sense." But other analysts said it made little difference whether the tariffs were aimed at U.S. trading partners or Congress, and that the main point was that the trading partners were on notice that retaliation was a weapon Reagan was ready to use. Spokesman Fitzwater said "we don't want a trade war," but the imposition of sanctions showed the United States would act when it had evidence that trade pacts were being violated. Reuter 

DIAMOND SHAMROCK <DIA> TO REDEEM DEBENTURES

Diamond Shamrock Corp said it will redeem May 29 the entire outstanding amounts of three separate sinking fund debenture issues. The company will buy back its outstanding 79.7 mln dlrs of 7.70 pct debentures of 2001 at 103.20 pct of par value plus accrued interest, 59.9 mln dlrs of nine pct debentures due 1999 at 103.15 pct per principal amount plus accrued interest, and 50 mln dlrs of 9-1/8 pct debentures of 2000 at 103.625 pct of par value plus accrued interest. Reuter 

ARGENTINE TROOPS END UPRISING

Rebellious troops in the central city of Cordoba called off an uprising against President Raul Alfonsin's government, the army command said. Congressional leaders said that it would probably not be necessary therefore to declare a state of siege. Military officers earlier said army units in Buenos Aires and Misiones provinces had supported the Cordoba regiment, the focal point of the uprising. The troops were objecting to human rights trials. Reuter 

YEUTTER ALMOST SURE JAPAN WILL NOT RETALIATE

U.S. Trade Representative Clayton Yeutter said he was almost sure Japan would not retaliate against tariffs President Reagan slapped on 300 mln dlrs of Japanese electronic goods today. "I'd say it's 99 plus pct sure that it (the tariffs) will not provoke a retaliation on American products," Yeutter told Cable News Network. "Japan has far too much at stake in this relationship (with the United States) to seriously entertain thoughts of retaliation," Yeutter said. Earlier today, Reagan imposed 100 pct tariffs on a range of Japanese goods in retaliation for Japan's alleged violation of a bilateral pact governing semiconductor trade. Yeutter did say that U.S. farm products would be targeted if Tokyo decided to hit back. "If they (Japan) were to retaliate, it would probably be on something like American agricultural products," he said. "But I really think the chances of that happening are between slim and none," he added. Reuter 

RADIO REPORTS SHOOTING AT MANILA ARMY HEADQUARTERS

Shooting erupted at Philippine army headquarters early this morning, an independent Manila radio station said. Radio DZRH said it was checking unconfirmed reports that about 120 mutineers had surrounded an office building inside Fort Bonifacio. An officer told Reuters an alert had been sounded at the camp. A Reuter reporter at the camp said the gates had been sealed and guards were preventing anyone from going inside. REUTER 

ARMY REBELS OCCUPY MANILA HQ

A truckload of heavily-armed rebel soldiers forced their way into Philippine army headquarters and freed several men held prisoner in the camp since a January revolt, military sources said. The sources told Reuters an estimated 100 rebels were occupying the headquarters building at Fort Bonifacio and forces loyal to President Aquino had surrounded the building urging them to surrender. An independent radio station reported gunfire at the camp. REUTER 

JAPAN WILL NOT RETALIATE NOW AGAINST U.S. TARIFFS

Japan does not plan to take immediate retaliatory action against implementation of U.S. Tariffs on some Japanese electronic goods, the minister of international trade and industry, Hajime Tamura, said in a statement. Japan requested bilateral consultations in accordance with Article 23-1 of the General Agreement on Tariffs and Trade (GATT) in Washington yesterday. Tamura said there was deep regret over the U.S. Measures, which will impose 100 pct tariffs on about 300 mln dlrs worth of Japanese imports of some small computers, colour television sets and power tools. REUTER 

TAIWAN ISSUES MORE CDS TO CURB MONEY SUPPLY GROWTH

The central bank has issued 5.3 billion Taiwan dlrs of certificates of deposits (CDs), boosting CD issues so far this year to 140.42 billion compared with 16 billion issued in the same 1986 period. The new CDs, with maturities of six months, one year and two years, carry interest rates ranging from 4.07 to 5.12 pct, a bank spokesman told Reuters. The issues are aimed at helping curb the growth of M-1b money supply, the result of large foreign exchange reserves now at more than 53 billion U.S. Dlrs. REUTER 

FOREIGN INVESTMENT RISES IN MALAYSIA

Foreign investment in Malaysia in 1986 rose to 524.5 mln ringgit, the highest since 1971, from 324.9 mln in 1985, the Malaysian Industrial Development Authority, MIDA, said. MIDA director-general N. Sadasivan said the increase was due to large investment from the Netherlands in a 180.3 mln ringgit petrochemical project in Bintulu, national news agency Bernama reported. REUTER 

BALDRIGE PRAISES NEW SOUTH KOREAN TRADE POLICIES

U.S. Commerce Secretary Malcolm Baldrige praised South Korea's new surplus-cutting trade policies but warned of possible protectionist retaliation if Seoul's market liberalisation efforts falter or fail. In a press conference after talks with South Korean leaders, Baldrige called the government's announced intention to regulate exports and boost imports "a very, very important step, the right direction for the Korean government to take." The government adopted the new policies last week in the hope of heading off a trade war with the U.S. Baldrige said the policies "showed an understanding of the fact that this country cannot go on indefinitely growing by exports alone." "There has to be enough of a change so that domestic growth begins to take more of the load," he said. South Korea had a 7.2 billion dlr trade surplus with Washington in 1986, thanks largely to booming sales of cars and consumer electronic goods. It racked up another 1.4 billion dlrs in surplus in the first quarter of this year. Baldrige said Seoul's package of measures was "broad enough and comprehensive enough so that ... Actions can be taken for liberalising imports (and) increasing the domestic economy, if the government is willing to follow through." "We will be watching the implementation of this new policy direction very closely," he said. "Because of the protectionism growing in the U.S., We see a real problem if Korea does not keep on the same path ... Of steadily increasing liberalisation.... If that should falter or fail or turn backward, I'm as sure as I'm standing here that we'd see protectionist movement in the U.S." Baldrige said he and South Korean Trade Minister Rha Woong-bae spent much time discussing trade problems in specific product categories. These included service industries, which he said were still too much of a closed sector in South Korea, and computers and cars. Baldrige said he urged speedy action on removing the tariffs and taxes on imported U.S. Cars which can make them sell for up to three times their American prices. "We want to stop that. With this sort of thing, there's going to be trouble somewhere down the road," he said. "We are just pointing this out." Asked if Seoul's measures could succeed without a revaluation of the won, which Washington has been urging for months, Baldrige declined to comment. "We don't have any target for any particular currency, but we do feel that currencies around the world, if we are going to be successful as a world economy, have to reflect the fundamentals of the various economies involved," he said. Baldrige said he had agreed to Rha's proposal for cooperation on forming U.S.-South Korean joint ventures in third countries. The American government would be pleased to encourage U.S. Firms to get involved, he added. Commenting on President Reagan's decision to increase tariffs on certain Japanese imports to the U.S., Baldrige said Washington's trade problems with Japan were not comparable to its difficulties with South Korea. "I think the attitude in Korea is both reasonable and fair," he said. "It's a firm attitude. We don't get anything for nothing or just by asking for it. "But our negotiations are friendly and reasonable and they usually end up with something good happening at the end that both countries live up to." REUTER 

PAKISTAN INVITES TENDERS FOR 15,000 TONNES RICE

Rice Export Corp of Pakistan Ltd said it had invited tenders up to May 7 for the export of 15,000 tonnes of rice from the 1985-86 (November/March) crop. REUTER 

ADB'S FUJIOKA SAYS STALEMATE WITH TAIWAN CONTINUES

The Asian Development Bank (ADB) will not change its decision to admit China as a member despite protests from founder member Taiwan, bank president Masao Fujioka said. China's admission in March 1986 and the decision of the bank to change Taiwan's name to 'Taipei, China' caused a Taiwanese boycott of the ADB's last annual meeting in Manila. Fujioka told Reuters in an interview that Taiwan had been invited to the bank's 20th annual meeting starting April 27 in Osaka, "but the situation remains the same." "The bank's board agreed to change Taiwan's name to 'Taipei, China'," Fujioka said. "We have tried to maintain our channels of communication through the Taiwanese director, but we are not negotiating with a view to changing our agreement with China," he said. ADB figures show China has the largest shareholding among the bank's developing members, with 7.2 pct of its equity. Fujioka said a stalemate also continued with Vietnam, which complained at last year's meeting that for several years the ADB had unilaterally stopped advancing loans. An ADB spokesman said the last loan of 40.67 mln dlrs was made to the then Republic of Vietnam (South Vietnam) in 1974. Vietnam said last year that only 23 mln dlrs of that loan were disbursed. The bank's 1986 annual report said of 11 loans approved for Vietnam, eight had been closed, two were suspended and only one was under administration at the end of 1986. Cumulative disbursements to Vietnam at the end of 1986 totalled 25.3 mln dlrs, or 99.5 pct of the total amount of effective loans, the report said. "The situation (in Vietnam) is not conducive to bank operations," Fujioka said. "Vietnam continues to be a member. We would like to help it, but new loans seem to be difficult." "It's not a question of political instability, the environment has to be right for banking operations." He said with the first loans made to India in 1986, and lending operations in China scheduled to start this year, the ADB had now acquired a "truly Asian" character. Although China's finance ministry had gained five years of experience in borrowing from the World Bank, ADB loans would be routed through the country's central bank, Fujioka said. "It's been a very slow start," Fujioka said. "We identified three projects (in China). One disappeared and we now have only two left." He said the ADB might lend China between 200 and 300 mln dlrs in 1987 for an investment bank and an energy project. He did not foresee an expansion of lending to India. The ADB in 1986 approved two loans to India totalling 250 mln dlrs. "There is a sort of agreement that our loans to India should be modest and that the World Bank should be the major lender," Fujioka said. He did not give details. Fujioka said the ADB saw its lending to the private sector serving as a catalyst. The bank's new private sector division in 1986 approved three loans totalling 11.46 mln dlrs without government guarantees. In addition, the ADB approved four equity investment projects totalling 8.15 mln dlrs. This raised to 15.18 mln the cumulative approvals since equity financing commenced in 1983. But Fujioka said the ADB should not compete with private banks. "We have a narrow path to walk," he said. He said he was happy with the decision of the bank's donor countries to increase the ADB's fund for soft loans. The fourth replenishment of the soft-loan window, the Asian Development Fund , brought it to 3.6 billion dlrs, from 3.2 billion, Fujioka said. In particular the United States has maintained its 16 pct share," said the ADB chief. He said there had been disagreements with the U.S., Which holds 14.9 pct of the bank's equity, over lending policies. The U.S. Complained in 1986 the ADB was granting bad loans in its impatience to hit lending targets. "I suspect there is some arm-twisting," he said. "I find some developed countries are more interested in the procurement side instead of the development side." Fujioka said he said he foresaw increased sectoral lending and a gradual dilution of the ADB's project-tied lending. Fujioka said project lending was expected to drop to 63 pct of total loans in 1987, from 66.5 pct in 1986 and 77.5 pct in 1985. He said sectoral lending was projected to rise to 20 pct in 1987, from 12.8 pct in 1986 and 7.5 pct in 1985. He said the bank would try to reduce some of its liquid assets by repaying borrowings carrying high interest rates. "On the other hand we must maintain our presence in major financial markets," he said. "Why should we not take advantage of historically low interest rates?" REUTER 

AUSTRALIAN COAL EXPORTERS FACE TOUGH JAPAN TALKS

Australian coal industry sources said Japanese electricity utilities are demanding price cuts in annual coal contract negotiations underway in Tokyo. But the sources said they were unable to substantiate reports here that one of the largest steaming coal customers <Chugoku Electric Power Co Inc> threatened to stop taking deliveries until new prices are set. Coal exporters want to maintain last year's 32 U.S. Dlrs a tonne price, which expired at the end of Japan's fiscal year on March 31, while the Japanese want to pay no more than the 27-28 U.S. Dlrs secured with China and South Africa. Ross McKinnon, general manager of <Thiess Dampier Mitsui Coal Pty Ltd>, which annually exports about one mln tonnes of steaming coal to Japan, mainly to Chugoku, told Reuters he had not been informed of any refusal to take shipments. McKinnon said he could not recall when a Japanese contract had been settled before the previous one had expired, and said "controlled leaks" were commonplace during talks. But Australian foreign currency markets took the reports seriously enough for dealers to say it added nervousness to trading, with the local dollar settling on 0.7080 U.S. Cents at midsession against its 0.7120 opening. Coal was Australia's largest single export in the fiscal year ended June 30, 1986 with shipments reaching 90.49 mln tonnes worth 5.21 billion dlrs, or 15.9 pct of total exports. Japan is the largest customer for the crucial steaming coal sector and took 14.97 mln tonnes of total exports of 43.3 mln tonnes in calendar 1986. Sydney resources analyst Ian Story said the appreciation of the Australian dollar against the U.S. Currency meant steaming coal exporters were now receiving just 44.72 dlrs a tonne against 52.42 dlrs when last year's contract was negotiated. REUTER 

ASIA TRYING TO FOSTER OIL EXPLORATION, SAYS U.N.

Asian countries are offering better oil exploration concessions to avert damaging shortfalls due to last year's oil price slump, the United Nations said. The Bangkok-based U.N. Economic and Social Commission for Asia and the Pacific said in its annual report that the price fall substantially cut exploration by foreign oil firms, which found it unprofitable to maintain investments in the region. Oil production investment in Indonesia fell to about 2.8 billion dlrs in 1985 from 3.2 billion in 1983 and was estimated to have declined six pct last year. There were 11 wells drilled in Thailand in 1986 against 64 in 1985. The report said <Thai Shell Exploration and Production Co Ltd>, a unit of the <Royal Dutch/Shell Group> announced a 30 pct cut in exploration and production spending last year. To counter declining output, India and Malaysia reduced petroleum sharing demands, while Indonesia cut taxes. Nepal offered a guaranteed income share of up to 87.5 pct to cover exploration costs, while Thailand began decreasing its 12.5 pct royalty payments. The big losers were major regional exporters such as Indonesia, Brunei, China, Malaysia and Iran. Their aggregate oil income fell an estimated 20 billion dlrs in 1986 from 40 billion the previous year. Indonesia's export earnings fell by nearly half in 1986 from 11.6 billion dlrs in 1985, the U.N. Report said. Iran also lost about six billion dlrs, Brunei 3.8 billion, China three billion and Malaysia 0.8 billion. However, Asian importers saved between eight and nine billion dlrs during 1985 and 1986, which considerably eased their balance of payments. South Korea, the Philippines, India, Thailand and Pakistan were major beneficiaries, with Thailand and Pakistan respectively saving about 875 mln and 435 mln dlrs last year. REUTER 

SWISS WHOLESALE PRICES RISE 0.1 PCT IN MARCH

Swiss wholesale prices rose 0.1 pct in March after a 0.3 pct fall in February and a 0.8 pct drop in March 1986, the Federal Statistics Office said. Prices fell 3.4 pct in the year to March after a 4.3 pct decline in the year to February and a 3.5 pct fall in the year ended March 1986. The March index, base 1963, was 168.8 compared with 168.5 in February and 174.7 in March 1986. The Statistics Office said the slight increase in March was due to higher prices for energy and consumer goods. REUTER 

NORTHERN FOODS TO SELL U.S. UNIT FOR 24 MLN DLRS

Northern Foods Plc <NFDS.L> said its <Northserv Inc> unit had agreed to sell <Flagship Cleaning Services Inc> to <Best Co Inc> of Nevada for 24.6 mln dlrs cash. Completion is due on April 30. Flagship is based in Philadelphia and holds the Sears, Roebuck and Co <S> franchise for domestic carpet and upholstery cleaning throughout the U.S. In the year to end March, 1986, Flagship - then known as KeyServ - reported pre-tax profits of 2.0 mln dlrs with end-year assets of 8.4 mln, giving a book profit on disposal of 16.2 mln. Northern Foods shares were unchanged at 297p. REUTER 

BUNDESBANK SETS NEW REPURCHASE TENDER

The Bundesbank set a new tender for a 28-day securities repurchase agreement, offering banks liquidity aid at a fixed bid rate of 3.80 pct, a central bank spokesman said. Banks must make their bids by 1400 GMT tomorrow and funds allocated will be credited to accounts tomorrow, April 22. Banks must repurchase securities pledged on May 20. REUTER 

JAPAN RICE POLICY EXTREME PROTECTIONISM, LYNG SAYS

Japan's policy of self-sufficiency in rice is an example of extreme protectionism, visiting U.S. Agriculture secretary Richard Lyng told a press conference. He told the National Press Club of Japan that because Japan had a large export balance, not just with the U.S. But with other countries, it was inconsistent for it to be 100 pct self-sufficient in one product. Speaking after farm trade talks with Japan agriculture minister Mutsuki Kato, Lyng said the U.S. Had not asked for total liberalisation of the rice market in Japan. Lyng urged Japan to allow some imports of rice. "We want to have some access in the rice market," he said. He said both he and trade representative Clayton Yeutter were disappointed at the outcome of talks with Japan. He told reporters Japan had rejected the U.S. Proposal to open negotiations on rice at the new round of trade talks at the General Agreement on Tariffs and Trade. Lyng said he suggested instead bilateral talks with Japan on rice. Kato has said Japan cannot negotiate on its policy of rice self-sufficiency. Asked what the next U.S. Step would be on the rice issue, Lyng said he did not know what Yeutter or the U.S. Rice industry would do. Yeutter has promised to consider again in July or August this year a complaint against Japan's rice import ban by the U.S. Rice Millers Association if no breakthrough is made in the meantime. U.S. Rice industry officials have indicated they would consider filing another complaint against the Japan rice import ban. REUTER 

ALCOA OF AUSTRALIA REPORTS INCREASED EARNINGS

Alcoa of Australia Ltd <AA.S>, owned 51 pct by the Aluminum Co of America <AA>, said net profit rose to 20.2 mln dlrs in the first quarter of 1987 from 0.8 mln in the same 1986 period. Sales revenue climbed to 300.9 mln from 233.0 mln. The company paid 36.5 mln income tax compared with 4.8 mln. Capital expenditure was 24.0 mln, against 33.4 mln. Alcoa spent 15.7 mln on its new Portland aluminium smelter compared with 25.8 mln the year before. Over 65 pct of the smelter's first potline is on stream and by the second quarter it will be producing at the full annual rate of 150,000 tonnes a year. REUTER 

PAKISTAN RETENDERS TODAY FOR RBD PALM OIL - TRADE

Pakistan will retender today for 6,000 to 12,000 tonnes of refined bleached deodorised palm oil for first half May shipment, traders said. REUTER 

SOUTH KOREA CUTS EXPORT FINANCE LOANS

South Korea has cut loans to exporting companies to help reduce the growing trade surplus with the United States and the European Community, finance ministry officials said. They said two billion dlrs worth of foreign currency loans would be available to firms willing to import industrial facilities, and 500 mln dlrs for those importing raw and intermediary materials and parts. Exporters, who previously received 645 won (0.769 dlrs) for each dollar's worth of overseas orders, will now get only 575 won (0.686 dlrs), they said. The officials said the government also stopped new bank loans given to aid the installation of export-oriented facilities by the nation's 30 largest business groups. A finance ministry official told Reuters the measures were part of the South Korean government's package to curb the increase in the nation's trade surpluses with major trading partners. South Korea had a trade surplus of 7.2 billion dlrs with the United States in 1986, against 4.1 billion in 1985. It had a surplus of 1.09 billion dlrs last year with the EC, against 188.8 mln dlrs in 1985. REUTER 

LYNG WARNS U.S. TRADE SITUATION IS EXPLOSIVE (RPT)

U.S. Agriculture Secretary Richard Lyng said Japanese government officials do not seem to understand that protectionist sentiment in the U.S. Could lead to an explosive situation and protectionist legislation. Speaking to the National Press Club of Japan, Lyng said protectionist sentiment in the U.S. Has increased alarmingly during the last six months. "It is a radically changed situation and is very explosive. We are on the verge of some very harsh mandatory retaliatory laws which would have very serious consequences for other countries, especially Japan," Lyng told reporters. Lyng's comments about protectionist trade legislation appeared to be a reference to the so-called Gephardt provision, requiring retaliation against countries which have trade surpluses with the U.S., Trade analysts said. U.S. House majority leader Thomas Foley, a Washington Democrat, yesterday predicted during a visit here that the Gephardt provision will be approved by the House when trade legislation is taken up later this month. Senior Japanese officials do not seem to perceive the volatility of the situation in the U.S., Where Congress is increasingly unpredictable, he said. "The purpose of this trip is to emphasise the fact that patience is beginning to be very much frayed in Washington. I cannot emphasise that enough," Lyng said. In talks with Japanese Agriculture Minister Mutsuki Kato yesterday, Lyng and Trade representative Clayton Yeutter asked Japan to begin negotiations on its rice policy and end import quotas on beef and citrus. Lyng said he was disappointed Kato rejected the U.S. Request but hoped it would not lead to a protectionist response in Congress, where legislation on rice retaliation has been introduced in both the House and Senate. Lyng said the U.S. Is dependent on Japan as a market for exports because Japan has been the largest buyer of U.S. Farm products since 1964, especially grains. He said the U.S. Understands Japan, with a limited land area, is concerned about maintaining some level of self-sufficiency in food for national security reasons. But he argued the freeing of farm product imports would not necessarily weaken Japanese agriculture. Lyng pledged the U.S. Will never again embargo shipments of farm products as it did in 1973. REUTER 

WORLD BANK SUGGESTS MORE OPEN ECONOMY FOR INDIA

The World Bank has suggested India should move to a more open economy by gradually removing most government controls on industry and adopting a liberal external trade policy with reduced levels of protection. A confidential "executive summary" of a draft Bank report on the Indian economy was made available to Reuters. It suggests liberalisation as part of a package of reforms to boost exports of Indian goods by making them more competitive. The summary said, "These reforms would result in (domestic) prices much more in line with world prices than is true today, and in a greater degree of import competition and export rivalry than the nation has ever seen." The summary said foreign trade must play a key role in India's transition towards a more dynamic economy. Liberal imports of capital goods would help modernise the economy and expose Indian producers to foreign competition. Larger exports would provide the foreign exchange for imports. "The main guideline is unambiguously to abandon the present principle of unlimited protection for all indigenously available products and to recognise the role of actual or potential competition from imports as a source of discipline on the prices and costs of public and private sector domestic manufacturers," the summary said. An Indian official told Reuters the government was discussing the report with the Bank. A final report with some changes was likely to be ready by May, but he declined to give further details. The Bank and industrialised nations will discuss the Bank's final report at a meeting in Paris on June 22 and 23 to discuss aid for India in the 1987/88 year starting in June. The summary said India's gross domestic product (gdp) grew at an average five pct in Indian fiscal years 1985/86 and 1986/87, which ended in March. It said investment was being sustained at nearly 25 pct of gdp. Almost 94 pct of the investment was being financed by national savings, mainly from the private sector. India's trade deficit is officially said to have narrowed to 5.6 billion dlrs in 1986/87 ended March, from a record 6.96 billion dlrs in 1985/86. The current account deficit fell to 2.4 billion dlrs in 1986/87 from 2.88 billion in 1985/86. But the summary said the improvement was largely due to lower prices of crude oil, petroleum products and fertilisers which make up the bulk of India's import bill. India was able to save about 2.6 billion dlrs in foreign exchange in 1986/87 due to lower prices of those products, the summary said. The Bank's summary said there was little room for complacency in the balance of payments position. It said that despite a lower trade deficit in 1986/87, Indian foreign exchange reserves fell by 240 mln dlrs. Real export growth would need to average at least 6.1 pct a year in value terms in the coming years to maintain a viable balance of payments, the summary said. It did not explicitly suggest the rupee should be devalued. India "might have to reaffirm the commitment to exporting while undertaking some dramatic changes in general incentives that involve some political costs," it said. "An example of such a policy would be the adoption of an exchange rate regime that maintained exporters' profitability," the summary said. It said such an approach had been successful in countries such as South Korea, Colombia and Turkey. It would maintain the competitiveness of Indian exports and simultaneously reduce import pressures. Earlier this year, the Indian government denied that the World Bank asked it to devalue the Indian rupee to boost exports. REUTER 

WORLD BANK'S IFC TO INVEST MORE IN MALAYSIA

International Finance Corporation (IFC), the World Bank's investment arm, will raise its investment in Malaysia to a maximum of 200 mln dlrs from current 21.2 mln, IFC chief executive William Ryrie said. He told reporters after a two-day meeting with government and private sector representatives that the IFC would be active in risk capital and equity finance. The IFC is interested in a 500 mln ringgit Sabah state government pulp and paper project and is talking to state investment holding company Permodalan Nasional Bhd about joint ventures to help transfer profitable firms to Malays. Ryrie added the IFC is involved in underwriting a 60 mln dlr Malaysian Fund to be launched on the New York Stock Exchange next month. IFC's investment in Malaysia involves textile manufacturing, development finance, cement, iron and steel, sawmill operations and money and capital markets. REUTER 

SPAIN'S CONSUMER PRICES RISE 0.6 PCT IN MARCH

Spain's consumer price index rose 0.6 pct in March after a 0.4 pct increase in February and 0.3 pct in March last year, the National Statistics Institute said. The March rise brought the year on year rate to 6.3 pct. The government has set a five pct target for 1987 consumer price inflation after an 8.3 pct increase last year. REUTER 

BELGIUM CUTS TREASURY CERTIFICATE RATES

The Belgian National Bank said it cut its one, two and three month treasury certificate rates effective immediately. It said in a telex message the key three month rate was reduced by 0.05 points to 7.25 pct, the two month rate by 0.10 points to 7.20 pct and the one month rate by 0.15 points to 7.15 pct. The Bank last adjusted its short-term treasury certificate rates on April 3, when all three rates were cut by 0.10 points. It has made regular small reductions in rates after hoisting the three month rate 0.50 points to 7.90 pct and the other rates to eight pct on January 6 ahead of the realignment of the European Monetary System. The National Bank bought more than 7.91 billion francs of foreign currency in the week ended April 13, a National Bank spokesman said last week. Foreign exchange analysts noted this reflects the current strength of the Belgian franc. REUTER 

TAIWAN INDUSTRIAL OUTPUT RISES SHARPLY IN MARCH

Taiwan's industrial production index, base 1981, rose 14.21 pct to 162.19 in March from a revised 142.01 in February, and 7.19 pct from March 1986, the Economic Ministry said. The February figure was revised from a preliminary 140.06. A ministry official said the March index stood at its highest level since the 169.94 set in December 1986. He attributed the increase to rising production of textiles, wooden and bamboo products, plastics, machinery, electronics, transportation equipment, mining and house construction. REUTER 

BOWATER BUYS BUILDERS' MERCHANTS HOOPER AND ASHBY

Bowater Industries Plc <BWTR.L> said it had agreed to buy Southampton-based builders' merchants <Hooper and Ashby Ltd> for 718,545 Bowater shares, floating rate unsecured loan stock and cash. It gave no further financial details besides saying that a final payment of cash or loan stock would be made when audited accounts were available. Hooper is a family-owned business which had a turnover of around 25 mln stg in 1986 and net assets of about nine mln stg. Bowater shares were unchanged at 495p on Thursday. REUTER 

BANK OF JAPAN BUYS MODERATE DOLLAR SUM -- DEALERS

The Bank of Japan intervened in the market to try to accelerate the dollar's rise after heavy dollar buying by institutional investors, dealers said. The central bank bought a moderate amount of dollars at around 142.10 yen, they said. REUTER 

JAPAN CAREFULLY WATCHING MARKETS, SUMITA SAYS

The Bank of Japan is carefully watching the recent rapid rise of the Tokyo stock and yen bond markets for their impact on inflation, governor Satoshi Sumita said. In a statement to the bank's regional branch managers, Sumita said the central bank was particularly monitoring the markets because of the recent rapid growth of money supply. He said he is also carefully watching real estate prices. Sumita said he expects money supply growth to remain high from April through June. In March, money supply, as measured by M-2 plus certificates of deposit, rose at a year-on-year rate of nine pct. REUTER 

PAKISTAN BUYS 6,000 TONNES RBD PALM OIL - TRADERS

Pakistan bought 6,000 tonnes of rbd palm oil at its import tender today for first half May shipment, traders said. The price was believed to be in the region of 345.50 dlrs per tonne cost and freight, but confirmation is awaited, they said. Pakistan sought to buy up to 12,000 tonnes for first half May and has not said when it is likely to tender for the balance. REUTER 

BALDRIGE PRAISES NEW SOUTH KOREAN TRADE POLICIES

U.S. Commerce Secretary Malcolm Baldrige praised South Korea's new surplus-cutting trade policies but warned of possible protectionist retaliation if Seoul's market liberalisation efforts falter or fail. In a press conference after talks with South Korean leaders, Baldrige called the government's announced intention to regulate exports and boost imports "a very, very important step, the right direction for the Korean government to take." The government adopted the new policies last week in the hope of heading off a trade war with the U.S. Baldrige said the policies "showed an understanding of the fact that this country cannot go on indefinitely growing by exports alone." "There has to be enough of a change so that domestic growth begins to take more of the load," he said. South Korea had a 7.2 billion dlr trade surplus with Washington in 1986, thanks largely to booming sales of cars and consumer electronic goods. It racked up another 1.4 billion dlrs in surplus in the first quarter of this year. Baldrige said Seoul's package of measures was "broad enough and comprehensive enough so that ... Actions can be taken for liberalising imports (and) increasing the domestic economy, if the government is willing to follow through." "We will be watching the implementation of this new policy direction very closely," he said. "Because of the protectionism growing in the U.S., We see a real problem if Korea does not keep on the same path ... Of steadily increasing liberalisation.... If that should falter or fail or turn backward, I'm as sure as I'm standing here that we'd see protectionist movement in the U.S." Baldrige said he and South Korean Trade Minister Rha Woong-bae spent much time discussing trade problems in specific product categories. These included service industries, which he said were still too much of a closed sector in South Korea, and computers and cars. Baldrige said he urged speedy action on removing the tariffs and taxes on imported U.S. Cars which can make them sell for up to three times their American prices. "We want to stop that. With this sort of thing, there's going to be trouble somewhere down the road," he said. "We are just pointing this out." Asked if Seoul's measures could succeed without a revaluation of the won, which Washington has been urging for months, Baldrige declined to comment. "We don't have any target for any particular currency, but we do feel that currencies around the world, if we are going to be successful as a world economy, have to reflect the fundamentals of the various economies involved," he said. Baldrige said he had agreed to Rha's proposal for cooperation on forming U.S.-South Korean joint ventures in third countries. The American government would be pleased to encourage U.S. Firms to get involved, he added. Commenting on President Reagan's decision to increase tariffs on certain Japanese imports to the U.S., Baldrige said Washington's trade problems with Japan were not comparable to its difficulties with South Korea. "I think the attitude in Korea is both reasonable and fair," he said. "It's a firm attitude. We don't get anything for nothing or just by asking for it. "But our negotiations are friendly and reasonable and they usually end up with something good happening at the end that both countries live up to." REUTER 

BLACK POLICEMAN KILLED, 70 HURT IN SOWETO ATTACK

A black policeman was killed and 70 were injured when a bomb was lobbed onto a parade ground in South Africa's biggest black township of Soweto this morning, the government said. The device was thrown from a passing vehicle as trainee township policemen from all over South Africa were on parade at the Tladi police training centre, the government's Bureau for Information said. Ten officers were seriously wounded and 60 suffered slight injuries, it said. A bureau spokesman said the type of explosive device used was not known and no arrests had been made. The government has blamed a spate of limpet mine blasts in South African cities in recent months on the outlawed African National Congress (ANC), fighting a low-level guerrilla war against white domination in South Africa. The municipal police, who perform security duties in black townships, have been a main target of black militants in the past three years of political unrest which has claimed some 2,400 lives. Many black policemen have been forced to live in compounds on the outskirts of townships after their homes were attacked. Today's attack, one of the most daring since a national state of emergency was declared last June, came as police and troops deployed at railway stations to stop attacks on trains linked to a bitter strike by black transport workers. Foreign Minister Pik Botha has alleged that the ANC is planning a campaign of violence in the run-up to the whites-only general election next month. Security is a major election issue, with extreme right-wingers accusing the government of being soft in the face of a "revolutionary onslaught." Botha warned neighbouring black-ruled states not to allow the guerrillas to infiltrate South Africa through their territory. He said South Africa would not hesitate to take action to thwart the alleged offensive. Zambia, Mozambique, Botswana and Zimbabwe denied Botha's charges and said they were a pretext for South African attacks on them. Pretoria has raided alleged ANC bases in the so-called Frontline states in the past. Reuter 

NORTH KOREA PLANS TO EXPAND TRADE, OUTPUT

North Korea unveiled plans to boost industrial and agricultural production sharply over the next seven years and to greatly expand its foreign trade. Prime Minister Li Gun-mo told the eighth Supreme People's Assembly in Pyongyang that North Korea intends to increase international trade by 220 pct in the period 1987/93, gross industrial output by 90 pct and agricultural production by 40 pct, according to the North Korean Central News Agency, monitored here. REUTER 

NORTH KOREA PLANS TO EXPAND OUTPUT AND TRADE

North Korea unveiled plans to boost industrial and agricultural production over the next seven years and to greatly expand trade with other nations, the official North Korean Central News Agency, monitored in Tokyo, reported. Prime Minister Li Gun-mo told the eighth Supreme People's Assembly in Pyongyang agricultural production will rise 1.4 times in the period of the new seven-year plan, the agency said. "For a more satisfactory solution of the problem of food, clothing and housing for the people, a 15 mln tonne target of grain will be hit...And 1.5 billion metres of textiles will be produced annually," he said. Annual output of non-ferrous metals will be lifted to more than 1.7 mln tonnes in the seven year plan, the agency quoted Li as saying. During the previous seven-year plan North Korea achieved annual output of 10 mln tonnes of grain. Chemical fertilizer production hit an annual target of five mln tonnes. He did not provide any other figures. REUTER 

ESSO UK PLANNING SLIGHTLY LESS OIL EXPLORATION

<Esso U.K. Plc>'s 1987 exploration scheme involves less activity than last year, said a company spokeswoman. She confirmed that Esso UK, a member of Exxon Corp <XON>, was likely to participate in 15 to 20 wells this year, against 25 wells last year. Total capital expenditure budget this year, however, will be similar to last year's budget of about 450 mln stg, she said. She added that exploration and production expenditure last year was 370 mln stg and Esso UK turned the year with 1.2 billion stg of forward capital commitment. The spokeswoman said 30 to 40 pct in cost savings had been made for development plans for Kittiwake - the only field in the Shell-Esso Gannet North Sea oil and gas cluster still being considered for development over the next few years. Esso UK and <Shell U.K. Exploration and Production>, part of the Shell Transport and Trading <SC.L> group, have so far spent between 300 to 350 mln stg on Kittiwake, with recoverable reserves of some 70 mln barrels. Cost savings were also made on the 40 to 45 mln barrel Osprey field which is expected to cost at least 150 mln stg to develop. Development of both fields are expected to go ahead this year or early next year, she said. REUTER 

DOCKERS' STRIKE HITS CANARY ISLAND PORT

Striking dockers brought the Canary Island port of Las Palmas to a halt today but called off a stoppage in Spain's main port of Barcelona after winning the reinstatement of a sacked worker, port officials said. They said about 15 freighters were affected in Las Palmas as talks on dockers' demands to reinstate five workers went on. A stoppage was also called off in Santa Cruz, on Tenerife. Union sources said the strike would continue in Las Palmas tomorrow and would spread unless the demands were met, with a strike threatened in all ports for two hours on Thursday, four on Friday, six on Saturday and every other hour from May 4-11. REUTER 

BRITAIN CALLS FOR FIGHT AGAINST PROTECTIONISM

British Foreign Secretary Sir Geoffrey Howe called on industrial and developing countries to combat trade protectionism and remove barriers which impede free trading in agricultural products. Howe said in an address to the annual meeting of the U.N. Economic and Social Commission for Asia and the Pacific (ESCAP) that success in fighting protectionism hinges on the current Uruguay Round of the General Agreement on Tariffs and Trade. He said Britain is committed to resisting and combatting protectionism because free trade is vital to Britain where 30 pct of the gnp comes from trade in goods and services. Howe urged developing countries to open up their markets, remove measures distorting free trade in services and provide protection for intellectual property rights. He said industrial nations should also adopt macro-economic policies which help reduce trade imbalances and promote stable currency relationships. Howe said the agricultural industry, plagued by surpluses and falling commodity prices in recent years, is over subsidised and over protected. But the problem of farm surpluses must be tackled despite the fact that it is politically difficult for any government to reverse the trend of growing farm subsidies. "This problem of over-subsidisation and over-protection of agriculture will dog us in the years ahead and it will need the sustained application of all our energy and our imagination to find solutions," Howe said. REUTER 

TAIWAN PROPOSES TO INVEST ONE BILLION DLRS IN U.S.

Taiwan's Economic Ministry has approved an ambitious proposal calling for a one billion U.S. Dollar investment by private and public companies in the United States over the next five years, ministry officials said. John Ni, director of the Ministry's Industrial Development and Investment Centre (IDIC), said under the IDIC proposal, Taiwanese firms would be encouraged to set up factories and invest in property and securities markets in the U.S.. Taiwan's 1986 investment in the U.S. Totalled 46 mln U.S. Dlrs, official statistics show. The investment was mainly in the electronics, food, service and trading sectors. The new proposal, approved by Economic Minister Lee Ta-hai yesterday, calls for investment of 80 mln U.S. Dlrs in 1987, 120 mln in 1988, 160 mln in 1989, 240 mln in 1990 and 400 mln in 1991, he told Reuters. It will be discussed soon by officials of the Finance Ministry, the Central Bank and the Council for Economic Planning and Development before being submitted to the cabinet for final approval, he said. "This is the first ambitious proposal with government initiatives to encourage our businessmen to invest in America," Lee said. He said government incentives to prospective Taiwanese investors would include bank loans and a five-year income tax holiday. Applications for investing in the U.S. Would also be simplified. A ministry spokesman told reporters the proposed investment would be helpful in creating job opportunities for Americans and avoiding U.S. Import quotas or restrictions on Taiwanese products. The plan will also help reduce Taiwan's trade surplus with the U.S., Which rose to a record 13.6 billion U.S. Dlrs in 1986, up from 10.2 billion in 1985, the spokesman said. The rising surplus has enabled Taiwan to accumulate some 54 billion U.S. Dlrs in foreign exchange reserves. Economists described the proposal as a significant step by the government to head off U.S. Protectionism. "Time is running out for us. Taiwan has lagged far behind Japan and South Korea in encouraging its businessmen to invest abroad," said Hou Chia-chi, economics professor at Soochow University. REUTER 

ADB'S FUJIOKA SAYS STALEMATE WITH TAIWAN CONTINUES

The Asian Development Bank (ADB) will not change its decision to admit China as a member despite protests from founder member Taiwan, bank president Masao Fujioka said. China's admission in March 1986 and the decision of the bank to change Taiwan's name to 'Taipei, China' caused a Taiwanese boycott of the ADB's last annual meeting in Manila. Fujioka told Reuters in an interview that Taiwan had been invited to the bank's 20th annual meeting starting April 27 in Osaka, "but the situation remains the same." "The bank's board agreed to change Taiwan's name to 'Taipei, China'," Fujioka said. "We have tried to maintain our channels of communication through the Taiwanese director, but we are not negotiating with a view to changing our agreement with China," he said. ADB figures show China has the largest shareholding among the bank's developing members, with 7.2 pct of its equity. Fujioka said a stalemate also continued with Vietnam, which complained at last year's meeting that for several years the ADB had unilaterally stopped advancing loans. An ADB spokesman said the last loan of 40.67 mln dlrs was made to the then Republic of Vietnam (South Vietnam) in 1974. Vietnam said last year that only 23 mln dlrs of that loan were disbursed. The bank's 1986 annual report said of 11 loans approved for Vietnam, eight had been closed, two were suspended and only one was under administration at the end of 1986. Cumulative disbursements to Vietnam at the end of 1986 totalled 25.3 mln dlrs, or 99.5 pct of the total amount of effective loans, the report said. "The situation (in Vietnam) is not conducive to bank operations," Fujioka said. "Vietnam continues to be a member. We would like to help it, but new loans seem to be difficult." "It's not a question of political instability, the environment has to be right for banking operations." He said with the first loans made to India in 1986, and lending operations in China scheduled to start this year, the ADB had now acquired a "truly Asian" character. Although China's finance ministry had gained five years of experience in borrowing from the World Bank, ADB loans would be routed through the country's central bank, Fujioka said. "It's been a very slow start," Fujioka said. "We identified three projects (in China). One disappeared and we now have only two left." He said the ADB might lend China between 200 and 300 mln dlrs in 1987 for an investment bank and an energy project. He did not foresee an expansion of lending to India. The ADB in 1986 approved two loans to India totalling 250 mln dlrs. "There is a sort of agreement that our loans to India should be modest and that the World Bank should be the major lender," Fujioka said. He did not give details. Reuter 

CSR MAKES SIGNIFICANT QUEENSLAND NATURAL GAS FIND

CSR Ltd <CSRA.S> and its partners have made a significant natural gas discovery in the Roma region of central western Queensland, CSR said in a statement. The Wingnut Number One exploration well flowed up to 6.5 mln cubic feet a day from three zones during drill stem testing over the intervals 1,180-1,207 meters and 1,112-1,159. CSR said the well, 400 meters from an existing gas gathering system, is the second of a four well program in the Roma petroleum leases being funded by <Barcoo Petroleum NL>. Interest holders on completion will be CSR 42.58 pct, Barcoo 49.9, and <IOL Petroleum Ltd> 7.51. REUTER 

TAIWAN INDUSTRIAL OUTPUT RISES SHARPLY IN MARCH

Taiwan's industrial production index, base 1981, rose 14.21 pct to 162.19 in March from a revised 142.01 in February, and 7.19 pct from March 1986, the Economic Ministry said. The February figure was revised from a preliminary 140.06. A ministry official said the March index stood at its highest level since the 169.94 set in December 1986. He attributed the increase to rising production of textiles, wooden and bamboo products, plastics, machinery, electronics, transportation equipment, mining and house construction. REUTER 

HODEL SAYS ODDS ON FINDING NEW ALASKA OIL 1-IN-5

U.S. Interior Secretary Donald Hodel said there was a one in five chance that new drilling in Alaska would find oil. "But if it's there, there's a very good chance that it would be a giant field," Hodel said on ABC's "Good Morning America." "So it is the best geological prospect that they (geologists) have talked to me about since I've been involved in this process," he said. Hodel announced yesterday that he would urge Congress to open up 1.5 mln acres of the Arctic National Wildlife Refuge in Alaska to oil exploration despite fears of environmental damage threatening the Caribou herd in the region. He said today the exploration was needed in an effort to prevent future U.S. oil shortages and said oil drilling in the large Prudhoe Bay field in Alaska proved oil could be drilled without severely damaging the environment. He said the Caribou herd at Prudhoe Bay had tripled, contrary to concerns before the drilling operation that it would endanger the herd. Reuter 

SWISS SIGHT DEPOSITS FALL BY 416.9 MLN FRANCS

Sight deposits of commercial banks at the Swiss National Bank fell by 416.9 mln Swiss francs to 7.46 billion in the six days ending April 16, the National Bank said. Sight deposits are an important measure of money market liquidity in Switzerland. Foreign exchange reserves fell by 627.4 mln francs to 32.50 billion francs. The National Bank attributed this fall to the dismantling of outstanding swap arrangements. Bank notes in circulation fell by 116.9 mln francs to 24.36 billion while other deposits on call at the National Bank, mainly government funds, fell by 116.0 mln francs to 825.5 mln. REUTER 

BALDRIGE ASSURES CHINA ON TRADE AND TECHNOLOGY

U.S. Commerce Secretary Malcolm Baldrige said U.S. Sales of high technology to China are rising despite Peking's complaints they are being restricted. He told reporters at the airport on arriving here for talks that technology transfers to China had increased every year and would continue to do so. The official Peking Review yesterday accused the United States of delaying approval on high-technology sales to China. Last year, Washington approved only 60 pct of the exports China applied for, the magazine said. "The COCOM-listed kind of export controls are just a fraction of the technology that the U.S. Is transferring (to China) by other means, such as joint ventures," Baldrige said. COCOM is the Western coordinating committee formed after World War Two to limit the export of advanced technology to Communist nations. Baldrige said he was sure U.S. Firms could compete against firms from other countries for high technology sales. He added that protectionism would hurt the economies of trading nations and said the Reagan Administration would fight protectionist legislation in the U.S. Congress. Baldrige and China's Foreign Trade Minister Zheng Tuobin will act as chairmen of the fifth session of a commission on commerce and trade that will review bilateral trade relations. A U.S. Official said other issues to be raised during Baldrige's talks are trade deficits, which each country says it has with the other, and the problems facing U.S. Companies investing in China. Reuter 

CITY RESOURCES UNIT ACQUIRES PHILIPPINE MINE OPTION

<City Resources (Asia) Ltd>, a locally listed unit of Australian based <City Resources Ltd>, said it acquired an 80-day option to buy exploration, development and operating rights for mining property on the island of Luzon in the Philippines. It said in a statement that average assay results of random samples of the Brescia ore bearing body on the 459-hectare site showed 2.4 grammes of gold, 64 grammes of silver and 1.9 grammes of copper per tonne. It said it will exercise the option if tests confirm the site's potential. Further details were not available. REUTER 

GATT TO PROBE JAPAN'S FARM IMPORT RESTRICTIONS

The General Agreement on Tariffs and Trade (GATT) will begin a probe on May 7-8 on the legality of Japanese import restrictions on 12 farm products, Agriculture Ministry officials said. The investigation, which will take place in Geneva, follows a U.S. Complaint last year that the restrictions violated GATT rules prohibiting import quotas. The products involved include fruit juice, peanuts and tomato juice. Reuter 

JAPAN CONSIDERING BUYING U.S. SUPERCOMPUTERS

The Japanese government is considering buying U.S.-made supercomputers to help defuse mounting trade friction between the two countries, Trade Minister Hajime Tamura was quoting as saying. Japanese officials said Tamura told visiting U.S. Trade Representative Clayton Yeutter that the government may set aside money for the purchase of the supercomputers in a supplementary budget to be drawn up later this year. But he emphasised that the matter was still under study and that no firm decision had been made. Tamura urged Yeutter to lift the trade sanctions imposed against Japan and argued that the yen's rapid rise was already working to correct the country's trade imbalance. But, according to Japanese officials, Yeutter held out little hope that the American trade sanctions would be lifted soon and said the United States needed action from Japan to boost its domestic demand and imports, not just words. In order to lift the tariffs imposed on 300 mln dlrs worth of Japanese exports last Friday, the U.S. Needs proof that its joint computer chip pact with Japan is working. And that will take time, Yeutter was quoted as telling Tamura. REUTER 

SMALL QUANTITY OF U.K. WHEAT SOLD TO HOME MARKET

A total of 2,769 tonnes of British intervention feed wheat, out of an available 57,300 tonnes, was sold at today's tender for the home market, the Home Grown Cereals Authority, HGCA, said. Price details were not reported. Reuter 

SUGAR PLANTING IN WESTERN EUROPE, DELAY IN USSR

Dry, warm weather over Western Europe sugar beet areas this week will allow planting to progress rapidly, private forecaster Accu-Weather Inc said. Sugar beet areas in Britain will be dry and warm Thursday and Friday while beet areas from France to West Germany will have dry, seasonable weather, becoming warmer. But damp, chilly weather will delay planting in all Soviet beet areas, it said. Eastern Soviet sugar beet areas were windy yesterday with rain and snow showers. Water equivalent amounts were 0.10 of an inch. Showers or snow flurries will linger today and up to 0.30 of an inch of rain is likely tomorrow. Reuter 

SWISS NATIONAL BANK SELLS YEN AGAINST DOLLAR

The Swiss National Bank sold yen against dollars, joining in concerted intervention by central banks, a spokesman for the National Bank said. He declined to say which central banks had been active in the market, but earlier today Tokyo dealers said the Bank of Japan had intervened at 142.10 yen to the dollar, and market sources here said they believed the Bundesbank was in the market as well. The National Bank spokesman declined to specify the volume of its dollar purchases or the rate paid. REUTER 

BUNDESBANK INTERVENES TO BUY DOLLARS AGAINST YEN

The Bundesbank intervened in the open market to buy dollars against yen, dealers said. They were responding to enquiries immediately after news the Swiss National Bank said it joined concerted intervention to sell yen for dollars. The Bundesbank had no immediate comment on the reports. But dealers said the German central bank came into the market just after 1300 GMT when the dollar was trading around 141.90 yen to buy small amounts of the U.S. Currency. Dollar trading had been very quiet for most of the European session. REUTER 

U.K. MONEY MARKET GIVEN FURTHER 183 MLN STG HELP

The Bank of England said it had given the money market a further 183 mln stg assistance in the afternoon session. This takes the Bank's total help so far today to 561 mln stg and compares with its estimate of a shortage of some 550 mln stg in the system which it earlier revised up from 400 mln. The central bank purchased bank bills outright comprising 80 mln stg in band one at 9-7/8 pct, eight mln stg in band two at 9-13/16 pct and 95 mln stg in band three at 9-3/4 pct. REUTER 

TRANSCANADA <TRP> UPS DOME <DMP> BID - REPORT

TransCanada PipeLines Ltd has raised its takeover offer for Dome Petroleum Ltd to 5.5 billion Canadian dlrs from 4.3 billion, according to a report on the Canadian Broadcasting Corp (CBC). However, a spokesman for Dome said the company is not interested, since it has already agreed to be acquired by Amoco Corp <AN> for 5.1 billion dlrs, the CBC said. Spokesmen at Dome and TransCanada could not immediately be reached for comment. Although Dome has said it is only interested in the Amoco offer, a spokesman for TransCanada was quoted as saying that the ultimate decision rests with Dome shareholders. "I don't know what (Dome chairman J. Howard Madconald) is going to say if a letter lands on his desk and he's got an offer there equal or better for the shareholders than the one he has on his desk at this time," TransCanada chief financial officer Neil Nichols was quoted as saying. Reuter 

HOG AND CATTLE SLAUGHTER GUESSTIMATES

Chicago Mercantile Exchange floor traders and commission house representatives are guesstimating today's hog slaughter at about 275,000 to 293,000 head versus 284,000 week ago and 320,000 a year ago. Cattle slaughter is guesstimated at about 122,000 to 128,000 head versus 128,000 week ago and 138,000 a year ago. Reuter 

FED OPPOSES CREDIT CARD INTEREST RATE CEILINGS

The Federal Reserve Board opposed pending legislation to establish ceilings on interest charged by credit card companies. "The Board does not believe it would be appropriate to impose a federal ceiling on credit card rates," Fed governor Martha Seger told a Senate Banking Subcommittee. "Among other things a Federal ceiling could have undesirable side effects in the form of reduced credit availability and could lead to changes in non-rate credit card terms," she testified. Reuter 

FED'S ANGELL SAYS BOARD IN HARMONY ON RATES

Federal Reserve Board Governor Wayne Angell said the Reagan appointed majority on the board was not at odds with Chairman Paul Volcker on whether interest rates should rise to support the dollar. "I would anticipate very little difference between the chairman's position on price-level stability - and on the view of the dollar in foreign exchange markets - and my own," Angell said in an interview with the New York Times. "And I would also see very little difference in (Governor) Manley Johnson's position and my own," he added. The newspaper said Angell was speaking in response to inquiries concerning a report by syndicated columnists Rowland Evans and Robert Novak that Volcker was ready to raise rates to defend the dollar but that he was being thwarted by the four Reagan appointed members on the board. Angell told the newspaper that there was no evidence of disagreement on the board and that "anyone who should suggest" there is one "might be reaching pretty far." Reuter 

BALLY <BLY> SELLS SIX FLAGS FOR 350 MLN DLRS

Bally Manufacturing Corp said it signed a definitive agreement to sell the stock of its Six Flags theme park subsidiary to an affiliate of Wesray Capital Corp. Ccompletion of the proposed transaction is expected in early May, it said. Bally said it will receive gross proceeds of 350 mln dlrs for the Six Flags subsidiary. Bally said the transaction is part of its restructuring and will result in an after tax profit of about 100 mln dlrs. Proceeds from the sale of Six Flags will be used for general corporate purposes and to reduce debt, it said. The sale of the theme parks will also remove from Bally's balance sheet an additional 250 mln dlrs in Six Flags debt now carried on the Bally balance sheet, it said. Kidder Peabody will provide bridge financing to Wesray to complete the proposed transaction, Bally said. Six Flags operates seven major theme amusement parks, two water parks and other family oriented entertainment facilities. Wesray Capital is a private investment firm based in Morristown, New Jersey. Reuter 

BOMB BLAST ROCKS WHITE AREA OF SOUTH AFRICA

A bomb rocked a white area of Johannesburg but first reports said no one was injured. Police said an explosive device was placed under a car in the Mayfair district. Reuter 

JAPAN SEES NEED TO ACT QUICKLY ON TRADE CRISIS

Japan is faced with a mounting crisis over its huge trade surplus and recognizes that it must act more quickly to refocus its export driven economy, a senior Foreign Ministry official said. "The sense of crisis among the Japanese public as well as the government is increasing," Deputy Director General Hiroshi Hirabayashi told reporters. "The need to accelerate the efforts (to restructure the economy) is well recognized." Hirabayashi said that gradual progress had been made to refocus the Japanese economy, but admitted that it might not seem all that spectacular to foreign observers. Difficulties had been encountered in implementing the so-called Maekawa report since it was unveiled a year ago, he said. But, he added, foreign governments should appreciate the efforts that have been made. The report, named for its principal author, former Bank of Japan governor Haruo Maekawa, called for a shift in Japan's economy away from its dependence on exports for growth. The Japanese cabinet today reviewed progress made since its release. According to Hirabayashi, Prime Minister Yasuhiro Nakasone told his fellow ministers that Japan must follow the direction set out by Maekawa and urged them to make efforts to achieve it. Foreign Minister Tadashi Kuranari added that not enough had been done to publicize the action Japan was taking to refocus its economy. Listing some of those actions, Hirabayashi said imports of manufactured goods have increased, interest rates have fallen, and coal, steel and non-ferrous metal output have been reduced. He expressed hope that Japan will act more quickly in the future to implement the report and scoffed at a suggestion that it would take ten years for Maekawa's goals to be met. "It will not take very much time to fulfill the (goals) set out by the Maekawa report," he said. REUTER 

GREAT WESTERN <GWF>SEES ANOTHER OUTSTANDING YEAR

Great Western Financial Corp said it should experience anouther outstanding year in 1987 based on the performance of the first three months. Reporting record earnings for the tenth consecutive quarter, the company said profits rose to 81.2 mln dlrs, or 1.66 dlrs a share, from 79.8 mln dlrs, or 1.50 dlrs, a year earlier. The company said its growth, "which includes a 19.7 pct increase in net interest income, encourages us to believe that 1987 will be another year of strong earnings growth." Great Western said its real estate loan originations totaled 1.7 billion dlrs in the latest quarter, up from 1.5 billion dlrs a year earlier. Total lending was 2.2 billion dlrs vs 1.9 billion dlrs. About 95 pct of first quarter loan volume was in adjustable rate mortgages or short term loans, it said. The company said loan sales were 755 mln dlrs in the latest quarter compared with 1.5 billion dlrs a year earlier. Reuter 

THAI CABINET APPROVES SEVEN PCT BUDGET INCREASE

The Thai Cabinet approved a seven pct increase in the national budget for fiscal 1987/88 starting next October, compared with a 6.2 pct increase for the current year ending September, a government spokesman said. He told reporters the budget, to be presented to Parliament by late next month or in early June, calls for spending of 243.5 billion baht against 227.5 billion this year. The new budget is intended to make Thailand's Gross Domestic Product grow by at least five pct during the year without compromising its conservative fiscal and monetary policy, the spokesman said. "The budget is in line with our policy to stimulate the economy and to achieve a stable growth while we continue maintaining our current cautious fiscal policy," he said. The spokesman said the budget provides for a 9.6 pct increase in fresh government investment expenditure to 39.8 billion baht, up from 36.3 billion this year. Government revenue is projected to grow 7.5 pct to 199.5 billion baht against 185.5 billion targetted for 1986/87. He said the budget contains a 44 billion baht deficit, or about 3.4 pct of GDP, compared with 42 billion or 3.5 pct planned for this year. The deficit is required by Thai laws to be financed by domestic borrowings. The finalised budget bill earmarks 59.8 billion baht, or 24.6 pct of total expenditure, for servicing the government's domestic and foreign debt, up from 56 billion and a similar 24.6 pct this year. REUTER 

LEGAL DISPUTES FORCE NEW HOLDING COMPANY FOR LME

The London Metal Exchange (LME) said it has applied to form a new holding company because of uncertainties relating to lawsuits filed over the 1985 tin crisis. The new company, to be called The London Metal Exchange Ltd, would replace a two-tiered committee and board structure with a single managing board by the end of July. The exchange said it took the steps after the Securities and Investments Board said unresolved legal tussles resulting from the tin crisis of October 1985 might prevent acceptance of the LME's application to become a Recognized Investment Exchange. The exchange currently is run by The Metal Market and Exchange Company Ltd, which is facing a law suit linked to tin. The assets needed to run the exchange will be transferred to the new company at fair market value, it added. Reuter 

FED OPPOSES CREDIT CARD INTEREST RATE CEILINGS

The Federal Reserve Board opposed pending legislation to establish ceilings on interest charged by credit card companies. "The Board does not believe it would be appropriate to impose a federal ceiling on credit card rates," Fed governor Martha Seger told a Senate Banking Subcommittee. "Among other things a Federal ceiling could have undesirable side effects in the form of reduced credit availability and could lead to changes in non-rate credit card terms," she testified. Reuter 

CANADA RETAIL SALES RISE 1.9 PCT IN FEBRUARY

Canada's retail sales, seasonally adjusted, rose 1.9 pct in February after a downward revised 0.3 pct decline in January, Statistics Canada said. Retail sales rose to 12.19 billion dlrs in February, a significant increase over the 11.97 billion dlrs recorded in January, the federal agency said. Unadjusted sales were 7.8 pct higher than in February, 1986. In February, automobile sales rose 3.4 pct, department store sales rose 3.2 pct and service stations were up 1.9 pct. The increases were slightly offset by a 2.0 pct decline in grocery, confectionery and sundries stores sales. Reuter 

EXXON <XON> RAISES HEATING OIL PRICE, TRADERS SAID

Oil traders in the New York area said Exxon Corp's Exxon U.S.A. subsidiary increased the price it charges contract barge customers for heating oil in New York harbor by 0.25 ct a gallon, effective today. The 0.25 cent price hike brings Exxon's contract barge price to 48.75 cts a gallon, traders said. Reuter 

ADMAR <ADMR.O> TO BUY SELECTCARE

Admar Group Inc said it agreed in principle to acquire SelectCare Management Co Inc for a combination of cash and stock totaling 3.6 mln dlrs. SelectCare, based in Torrance, Calif., manages alternative health care delivery systems, Admar said. It said the company has annual revenues of about 1.5 mln dlrs. Reuter 

FED EXPECTED TO ADD RESERVES IN MONEY MARKET

The Federal Reserve is expected to enter the U.S. government securities market to add temporary reserves, economists said. They said it is likely to supply the reserves indirectly by arranging two to 2.5 billion dlrs of customer repurchase agreements. There is less chance of a direct reserve add instead via System repurchase agreements. Federal funds, which averaged 6.21 pct yesterday, opened at 6-3/8 pct and traded between there and 6-7/16 pct. Reuter 

ALFIN <AFN> DRUG MISLABELLED, SAYS FDA

Alfin Inc <AFN> said it has received a regulatory letter from the Office of Compliance of the U.S. Food and Drug Administration asserting that because of labelling and certain advertising claims its Glycel products are "new drugs" within the meaning of the Federal Food, Drug and Cosmetic Act for which no approval has been obtained and are "misbranded" in their labelling. The company said it understands that this action is part of an industry-wide investigation. The company added it is reviewing the matter with counsel, intends to respond and take corrective action, if necessary. Reuter 

SUPREME COURT UPHOLDS INDIANA TAKEOVER LAW

The Supreme Court, in a 6-3 decision, ruled that an Indiana law aimed at protecting companies from hostile takeovers by out-of-state businesses is constitutional. The high court justices reversed a ruling by a U.S. Court of Appeals in Chicago that struck down the 1986 control-share acquisition law. The case involved a hostile takeover bid by Dynamics Corp of America against CTS Corp, based in Elkhart, Ind. Dynamics made a tender offer in 1985 for one million shares to bring its holdings of CTS stock to 27.5 pct of the company's total. After CTS invoked the state law, Dynamics filed a lawsuit challenging the constitutionality of the measure. One effect of the law is to impose a 50-day delay on the tender offer at the option of the target company. It also requires that the acquisition for control shares in an Indiana corporation does not include voting rights unless a majority of all pre-existing shareholders so agree at their next regularly scheduled meeting. Justice Lewis Powell, writing for the court majority, held that the state law was not pre-empted by federal securities law. "The Indiana Act protects independent shareholders from the coercive aspects of tender offers by allowing them to vote as a group," he said. He acknowledged that the law may delay some tender offers and may decrease the number of successful tender offers for Indiana corporations. But he said the law does not discriminate against interstate commerce and was justified by the state's interests in protecting shareholders. Reuter 

STATE OF N.J. IN 43 MLN DLR PROGRAM STOCK SALE

The State of New Jersey said that it sold 23 stocks in a program trade worth 43 mln dlrs this morning. Roland Machold, director of the Division of Investment for the state of New Jersey, said, "the sale was part of our ongoing divestment program." Under N.J. state law enacted in August 1985, the state must divest all securities, stocks and bonds, of companies that do business in, or with South Africa by August 1988, Machold said. He said "in order to be fully divested by August 1988, we will probably have to sell an average every week of between 50 mln and 75 mln dlrs of stock." The stocks sold in today's program sale include Abbott Laboratories <ABT>, Allied Signal Inc <ALD>, CitiCorp <CCI>, Ford Motor Co <F>, General Motors <GM>, Gillette Co <GS>, H.J. Heinz <HNZ>, IBM <IBM>, Minnesota Mining and Manufacturing <MMM>, Mobil <MOB>, Monsanto Co <MTC>, NCR Corp <NCR>, Pepsico Inc <PEP>, Pfeizer <PFE>, Union Camp <UCC>, USX <X>, Westinghouse Electric <WX>, Weyerhaeuser Co <WY>, American International Group <AIG>, CBS <CBS>, Coca-Cola <KO>, Merck <MRK> and Upjohn <UPJ>. Machold said that one brokerage house handled today's sale but seven houses bid on the deal. He would not disclose the brokerage house that handled the sale. "The total value of the sales to date," Machold said, "are about three billion dlrs in book value and about four billion dlrs in market value." He said that because of the difficulty of defining companies that do business with South Africa, it is difficult to determine exactly how much future sales will be worth. Machold estimated the book value of future sales to August 1988 will be in the range of 1.2 billion dlrs to 5.2 billion dlrs. Reuter 

DU PONT'S <DD> CONOCO FINDS OIL OFFSHORE CONGO

Du Pont Co's Conoco Inc said the Viodo Marine Number one exploratory well offshore the People's Republic of the Congo produced up to 1,135 barrels of 26.55 degree gravity oil daily in tests through a 3/4 inch choke. The company said the well, in 202 feet of water about 10 miles west of Pointe-Noire, Congo, was drilled to a depth of 11,527 feet and tested between 7,204 feet and 11,300 feet. The well is located on the Marine II block, a 260,000 acre offshore permit acquired in May 1985, where Conoco is operator with a 42.5 pct interest. <Orange-Nassau Marine C.V.> owns 7.5 pct and Hydro Congo, the state oil company, 50 pct. Reuter 

FALCONBRIDGE <FALCF.O> SEES IMPROVED RESULTS

Falconbridge Ltd said it expected results for the rest of 1987 to improve from the earlier reported first quarter operating loss of 15.4 mln dlrs. Chief executive William James told reporters after the annual meeting that "I would hope that the loss for the year certainly wouldn't be a high as the loss for the first quarter. In other words we are going to make money from here on in." Falconbridge last year made a first quarter operating loss of 17.1 mln dlrs and a full-year operating loss of 15.5 mln dlrs. James said currency losses tied to the stronger Canadian dollar resulted for about eight mln dlrs of the first quarter operating loss. Falconbridge records its cash and accounts receivable in U.S. dollars, with the Canadian dollar equivalent decreasing as the U.S. dollar falls. He said the first quarter loss also stemmed from weaker nickel and ferronickel prices and lower production at the company's Sudbury, Ontario nickel operations and at some Kidd Creek operations. Falconbridge anticipates higher production through the rest of the year and higher average prices this year for precious metals, James added, without elaborating. Falconbridge has no immediate plans for further divestments, James said in reply to reporters' inquiries. The company sold several mining subsidiaries last year to help pay down debt from its January, 1986 acquisition of Kidd Creek Mines Ltd from Canada Development Corp <CDC.TO>. He said Falconbridge's debt now totaled about one billion dlrs, down from 1.37 billion dlrs at the time of the Kidd Creek buy. James said he could not assess the impact of Amoco Corp <AN>'s proposed acquisition of Dome Petroleum Ltd <DMP>. Dome's 23 pct-owned Dome Mines Ltd <DM> owns 21 pct of Falconbridge. Asked by reporters if Falconbridge preferred competing Dome bidder, Calgary, Alberta-based TransCanada PipeLines Ltd to Chicago-based Amoco, James replied, "It makes no difference to me...whoever takes it over is fine by us." He told shareholders that Falconbridges' planned capital expenditures this year would decline to 134 mln dlrs from 160 mln dlrs last year. Reuter 

SYMBOL TECHNOLOGIES <SMBL.O> FILES SHARE OFFER

Symbol Technologies Inc said it filed with the Securities and Exchange Commission to offer two mln shares of common stock through Shearson Lehman Brothers Inc and L.F. Rothschild Unterberg Towbin Inc. The shares offered do not include shares issuable under an over-allotment and 48,075 shares to be sold by selling shareholders, the maker of bar-code reading equipment said. Reuter 

TRANSCANADA <TRP> DENIES REPORTS OF NEW BID

TransCanada PipeLines Ltd denied reports that it raised its offer for Dome Petroleum Ltd <DMP> to 5.5 billion Canadian dlrs from 4.3 billion. A report on the Canadian Broadcasting Corp (CBC) late last night said TransCanada's new bid was rejected by Dome, which has accepted a 5.1 billion dlr bid from Amoco Corp <AN>. "We still want to acquire Dome's assets and are prepared to negotiate. However, we have not presented a new proposal to the company since April 16 and Dome has refused to negotiate with TransCanada since that date," said TransCanada president Gerald Maier. TransCanada said its proposal consists of two parts -- 4.5 billion dlrs in cash and securities and one billion dlrs of payments to creditors based on future profits. Last week, TransCanada valued the first part of its offer at 4.3 billion dlrs, but a spokesman today said the company increased the estimated value of that part to 4.5 billion dlrs after the recent gain in Dome's stock. Dome was halted today on the Toronto Stock Exchange pending clarification of TransCanada's offer. It last traded at 1.70 dlrs per share. Two weeks ago, before TransCanada's offer, Dome traded at about 1.10 dlrs per share. Reuter