IOC chief backs Japan to overcome crisis

TOKYO, July 16 (AFP): IOC president Jacques Rogge on Saturday heaped praise on Japan's track record in hosting major world sports events and said the country would rise again after the March 11 earthquake and tsunami.

His comments came as Tokyo was to announce its bid for the 2020 Olympic Games as a catalyst for the country's reconstruction after the disaster.

"I appreciate again the great virtues of the Japanese people -- their courage, their sense of duty, their sense of citizenship and moral fortitude," he told a ceremony in the capital marking the 100th anniversary of the Japanese Olympic Committee.

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Euro zone makes fresh bid to tackle Greek crisis

BRUSSELS/BERLIN, July 14 (bdnews24.com/Reuters) - Euro zone countries continued to grapple with the thorny issue of involving the private sector in tackling Greece's debt pile as they prepared for a meeting to decide support for the country next week.

"The principle of having a euro chiefs' meeting is accepted by the main players, including Germany," said one EU diplomat, adding that it was likely to happen next week despite earlier signals from Berlin that there was no rush to finalise a second package of aid.

First, however, countries have to agree how to involve private sector investors in tackling Greece's debt burden, a key demand of Germany before it signs off more support for Athens and a step the International Monetary Fund said on Wednesday must be taken.

"Comprehensive private sector involvement is appropriate, given the scale of financing needs and the desirability of burden sharing," the IMF said in its latest review of the debt-choked country.

"Greece's debt service capacity may also need to be bolstered by combining appropriate PSI and official support," IMF officials wrote, referring to private-sector involvement.

Ratings agency Fitch cited continued uncertainty about private-sector participation and foot-dragging on giving more aid to Greece, when it downgraded the country further into junk territory.

Euro zone leaders' agreement to meet followed warnings they needed to act quickly after markets were rattled by the failure of finance ministers to reach agreement earlier this week.

Italian central bank chief Mario Draghi, soon to take the helm of the European Central Bank, and Ireland's premier both said a definitive plan was needed and quickly -- echoing a strongly-worded attack from Greece's prime minister earlier in the week.

The spotlight was taken off the euro zone, at least temporarily, after the Federal Reserve Chairman Ben Bernanke said the central bank could resort to more monetary stimulus if a sluggish U.S. economy weakens further.

Ratings agency Fitch had also countered the bleak outlook in Europe following an earlier downgrade of Ireland to junk status by Moody's when it said Italy could keep its credit status by sticking to fiscal targets.

But many remained on edge after a market attack on Italy and concerns that it too could need assistance, something that would overwhelm the euro zone's existing rescue funds.

"Moody's problem is not with Ireland, Ireland's problem is with Europe," Prime Minister Enda Kenny told parliament, as the cost of insuring Irish debt climbed.

"There is no point in having a meeting that won't bring about a conclusion in a comprehensive sense to something that is not going to go away unless it is dealt with."

WRANGLING

Should the leaders meet, they will need to pin down how private owners of Greek government bonds can be persuaded to shoulder a portion of the cost of a new package for Greece, a key demand of Germany.

They will weigh up the potential impact on markets if securing such involvement is declared a debt default by ratings agencies, as expected.

But countries had appeared to be subsiding into a bout of internal wrangling and risk creating a no-win situation.

"Markets reacted very badly after euro zone finance ministers could not reach an agreement," an EU diplomat said, referring to a finance ministers' meeting on Monday. "If they cannot agree, we take the fight to the highest level."

Herman Van Rompuy, the presides over meetings of EU leaders, had originally informed ambassadors he wanted to hold a summit on Friday evening.

But Europe's biggest economic power, Germany, which one EU official said was angry about being "backed into a corner", was reluctant, pushing the date of the gathering into next week.

STRESS TESTS

Another concern of leaders are the results of stress tests of European banks.

That could have a further impact on Italy, where bank stocks and the bond market have been hit by growing concerns that the euro zone's third-largest economy could be next in line after Greece, Ireland and Portugal to suffer debt contagion.

Draghi said Italian banks would comfortably pass the tests but echoed Kenny's call for a comprehensive EU response to the spreading debt crisis.

"We have to recognise that management of the financial crisis has not gone smoothly with partial and temporary interventions," he said in a speech.

"We must now bring certainty to the process by which sovereign debt crises are managed, by clearly defining political objectives, the design of instruments and the amount of resources," he said.

There are two main proposals on the table for securing the private sector's involvement in reducing Greece's debt burden.

One would be to buy back Greek bonds at a discount. Another is to swap Greek debt for longer-dated securities with a lower coupon.

However, it remains unclear how a buy-back of Greek bonds would be financed. It could involve using the 440 billion euro (387 billion pound) European Financial Stability Facility (EFSF).

The ECB remains vehemently opposed to any Greek plan that ratings agencies would be likely to see as a default.

ECB policymaker Jens Weidmann said the EFSF should not be used to buy bonds in the secondary market and it would be unacceptable for the ECB to accept Greek debt as collateral if the country were in default.

"The money of the (EFSF) bailout should not be used for the purchase of government bonds in the secondary market," he told Die Zeit newspaper. "Containment of the crisis should not mean that we undermine our principles. We must draw a red line."

But Germany's finance ministry said funds from the euro zone's rescue mechanism could in theory be used by members of the bloc to buy back their own bonds, suggesting a shift in Berlin's stance.

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Nahid intervenes in Viqarunnisa crisis

Dhaka, July 13 (bdnews24.com)?Hours after the purported sacking of the principal of the Viqarunnisa Noon School and College on Wednesday, the education minister has said the turmoil in one of the most prestigious schools in Dhaka will be resolved by the day.

Nurul Islam Nahid said "neither I nor my ministry" knew anything about the sudden change at the helm by the school's governing body.

The minister also said at his Secretariat office on Wednesday he had directed the Dhaka education board chairman, the joint secretary of his ministry and relevant people to resolve the issue by Wednesday.

"I hope that things will get back to normal from Thursday at the renowned institution," he added.

Assistant professor Ambia Khatun replaced Hosne Ara Begum as principal. Ambia is the senior-most teacher after Hosne Ara. The sacking is the latest of troubling developments after one of its teachers was accused of violating a student of the female-only institution.

"The ministry was not told about the decision to remove (Hosne Ara). I know nothing about it. But it's clear that there's a chaos," Nahid told reporters.

Acting chairman of the board Dilip Roy said that several members of the body had taken the decision in the morning, but "it can't be considered as an official decision by the committee".

The governing body chief Rashed Khan Menon MP is currently abroad.

Classes in the Baily Road college unit, which had remained suspended since Saturday, resumed at noon.

Students and guardians of the four branches of the school and college have been demanding the expulsion of Hosne Ara for allegedly being reticent about taking action against Bashundhara branch teacher Parimal Jayadhar, charged with violating a 10th-grade student at the branch.

Hosne Ara and acting headmaster of the Bashundhara branch Lutfar Rahman were also accused in the case, filed by the victim's father.

Jayadhar, a Bangla department teacher, has admitted to the crime in a statement given before a Dhaka metropolitan magistrate.

As senior teachers insisted, all academic activities at the Baily Road unit remained suspended after only two classes were held on Wednesday morning.

Classes in the Baily Road college unit have remained suspended since Saturday.

Nahid deplored the incident and expressed his concern. "The arrested teacher should be given exemplary punishment (if found guilty)."

Senior teacher Rokhsana Shamim told bdnews24.com that the 'expelled' principal did not listen to the demands of students, guardians and teachers.

"Rather she would threaten the teachers who demanded punishment of the perpetrator and herself spoke ill of the victim."

"She did not sit with the protesting guardians, as she wanted to hush up the matter.

"We've learnt a lot from the agitating students who had been protesting the inaction of authorities. We're ashamed," Rokhsana added.

The senior teacher, working at the Baily Road branch, said Hosne Ara had been absent since July 4, when the case was filed. "She did not take leave officially."

Rokhsana said the removal of Hosne Ara was decided in the governing body meeting on Tuesday afternoon and added that five out of eight members endorsed it.

"Everyone is happy after the decision," she claimed.

The new principal has been serving the institution for the last 34 years, she added.

The senior teacher called for assistance from society and said their action should not be viewed 'politically'.

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IMF cuts US growth forecast, warns of crisis

SAO PAULO, June 17 (bdnews24.com/Reuters) - The International Monetary Fund cut its forecast for US economic growth on Friday and warned Washington and debt-ridden European countries that they are "playing with fire" unless they take immediate steps to reduce their budget deficits.

The IMF, in its regular assessment of global economic prospects, said that bigger threats to growth had emerged since its previous report in April, citing the euro zone debt crisis and signs of overheating in emerging market economies.

The global lender forecast that US gross domestic product would grow an anemic 2.5 percent this year and 2.7 percent in 2012. In its forecast just two months ago, it had expected 2.8 percent and 2.9 percent growth, respectively.

The outlook elsewhere was mixed. The IMF said it was slightly more optimistic about the euro area's growth prospects this year, but a lack of political leadership in dealing with that crisis and the budget showdown in the United States could create major financial volatility in coming months.

"You cannot afford to have a world economy where these important decisions are postponed because you're really playing with fire," said Jose Vinals, director of the IMF's monetary and capital markets department.

"We have now entered very clearly into a new phase of the (global) crisis, which is, I would say, the political phase of the crisis," he said in an interview in Sao Paulo, where the forecast was published.

In the United States, the political problems include a fight over raising the debt ceiling. Fears that the world's biggest economy could default, even briefly, have rattled markets, with Fitch Ratings saying even a "technical" default would jeopardize the country's AAA rating.

Meanwhile, Greece has edged closer to default as euro zone officials disagree on a possible second aid package for the indebted country. With strikes and protests around the country, political turmoil has added to uncertainty, stoking fears that the government will not be able to tighten its belt enough to reduce crippling deficits.

"If you make a list of the countries in the world that have the biggest homework in restoring their public finances to a reasonable situation in terms of debt levels, you find four countries: Greece, Ireland, Japan and the United States," Vinals said.

EMERGING MARKETS OVERHEATING?

Fears of contagion in the euro zone have driven global markets lower in recent sessions, with other vulnerable countries such as Ireland and Portugal feeling pressured.

The IMF raised its growth view for the euro area in 2011 to 2 percent from 1.6 percent. For 2012, the IMF saw growth at 1.7 percent, nearly stable from its previous 1.8 percent.

It raised its forecast for Germany, the powerhouse of the euro zone, to 3.2 percent from 2.5 percent, with growth moderating to 2 percent in 2012.

Forecasts for large emerging markets remained stable or slipped. While China's GDP view stayed at 9.6 percent this year, the IMF lowered its forecast for Brazil to 4.1 percent from 4.5 percent in April.

Those countries, along with Russia, India and South Africa, make up the fast-growing BRICS, a group of emerging economies whose brisk expansion has outstripped that of developed markets recently.

Robust growth has caused emerging economies to tighten monetary policy, with higher interest rates and reserve requirements, even as many developed nations keep policy ultra-loose to try to boost anemic growth.

The IMF warned that many emerging markets still need more tightening. In China, for example, the high inflation rate means negative real interest rates.

Some emerging markets have been reluctant to tighten too far, fearful of derailing growth or attracting speculative flows that could pressure currencies ever higher.

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