Experts: Economy will get better

www.thehollandsentinel.net Web posted Saturday, February 15, 2003 In Brief - Business

WASHINGTON -- The United States, which struggled through a stop-and-go recovery last year, should see the economy steadily gain strength in 2003, according to a panel of prominent economic forecasters.

But that outlook from the National Association for Business Economics comes with an important caveat -- any U.S. war with Iraq ends quickly.

A panel of 37 top economists, who prepared NABE's latest quarterly outlook, said Friday that President Bush's call for a new round of tax cuts would provide a moderate boost to the economy this year and next.

But the forecasters said that an even bigger positive factor would be a quick resolution of the war, which would remove uncertainty that is holding back business investment plans.

Krispy Kreme shares increasing in value

WINSTON-SALEM, N.C. -- Shares of Krispy Kreme Doughnuts Inc. shot up Friday after the company said earnings in the current fiscal year would jump 35 percent above those of the year just completed.

Krispy Kreme said in a news release that it expects earnings of 88 cents a share in fiscal 2004, which began this month, and a 10 percent sales growth at its existing stores. Krispy Kreme also plans to open 77 stores in the next 12 months.

Shares of Krispy Kreme soared $2.75, or nearly 10 percent, to close Friday at $31.15 on the New York Stock Exchange.

General strike hurts Venezuela economy

CARACAS, Venezuela -- A general strike and lingering recession have taken a heavy toll on the Venezuelan economy, which shrank nearly 17 percent in the final quarter of last year, according to government figures released Friday.

The nation's oil sector, which accounts for about a third of gross domestic product, contracted by nearly 13 percent in the fourth quarter as thousands of workers walked off their jobs while the government of President Hugo Chavez worked to restore production.

Overall, the economy fell 16.7 percent in the fourth quarter and 8.9 percent for the entire year, Planning Minister Felipe Perez said Friday on a government Web site.

Most of the contraction in the economy was due to reduced oil production, a combination of Venezuela's adherence to lower production quotas established by the Organization of Petroleum Exporting Countries, followed by the general strike, which began Dec. 2.

TELECOM

France Telecom plan: Halve debt in 2 1/2 years

France Telecom hopes to cut its debt by nearly half, to a ``bearable'' level of about 35 billion euros ($37.9 billion) within 2 1/2 years, the company's chairman said Friday.

France Telecom's debt at the end of 2002 is expected to be about 68 billion euros ($73.6 billion), said Thierry Breton. He said debt will be cut by reducing the company's working capital and operating costs, and with ``marginal'' asset sales.

Costs will also be reduced through job cuts, although those will be from normal departures and retirements only, not layoffs, he said.

BANKING

Lloyds Group profit drops 40 percent

British bank Lloyds TSB Group on Friday reported a 40 percent decline in profit for the second half of 2002, blaming rising provisions for bad loans and a lingering bear market for stocks.

Net income for the period was 668 million pounds ($1.1 billion), compared with 1.1 billion pounds ($1.8 billion) a year earlier. The bank froze its dividend and said it would need to invest money in its pension fund to compensate for falling stock prices.

Rising provisions for bad loans and falling stock prices have also hit other British banks, including Barclays and Abbey National.