LONDON, Feb. 11--Israel's plan to withdraw from Gaza and a ceasefire summit with Palestinians this week should boost prospects for Palestinian economic growth, but it will need international money, Israeli officials said on Thursday, Reuters reported.
Hopes of peace in the Middle East reignited this week after newly appointed Palestinian leader Mahmoud Abbas met Israeli Prime Minister Ariel Sharon.
But with Palestinian gross domestic product (GDP) per capita in the Israeli-occupied West Bank and Gaza estimated to be one twentieth of Israel's, the dilemma of no security without prosperity--and vice versa--remains an obstacle.
"What comes first, economic or political? I do not know," said Yossi Gal, deputy director-general and head of economic division at Israel's foreign ministry, told a forum in London.
"Everything is related to security. Without security there will be no economic development."
Sharon's "Disengagement Plan" involves withdrawing settlements from Gaza Strip and a small bit of the West Bank later this year. It also outlines proposals to leave "productive" property intact which Israel says could be used by Palestinians.
The international donor community has arranged to give Palestinian Authority areas $1.5 billion each year for the next three years, according to the Israeli officials, with a third of that set aside for economic projects.
"This could take us ... to a plan put in place by Palestinians aimed at closing that gap (in GDP) so the basic manifestation of economic performance will not be one to 20, but far closer," said Ilan Baruch, director of Middle East economic department in Israel's foreign ministry.
The World Bank estimates almost half of 3.6 million Palestinians in the territories live on less than $2 a day, compared to 20 percent in 1999, with unemployment at 29 percent of the workforce.
Agriculture and construction will provide most employment opportunities in the short term, but more help from overseas will be needed to develop the Palestinian economy further, Gal said.
"There is a role for the international community to play in the efforts to revitalize the Palestinian economy," he said.
Palestinian leaders say the key to economic reconstruction and development is an end to Israeli army roadblocks and checkpoints and eventual withdrawal from the occupied territories.

MOSCOW, Feb. 11--Russia will bar foreign-owned firms from bidding for some of its most lucrative natural resources in 2005, officials said on Thursday, dealing a heavy blow to the already shaky business climate in the country, Reuters reported.
The Natural Resources Ministry said companies will have to be at least 51 percent Russian-owned to take part in tenders for strategic oil and metals deposits.
The tender list includes the giant Sakhalin-3 oil field in Russia's far east, which US ExxonMobil had planned to develop. It includes the Sukhoi Log gold field--Eurasia's biggest--and the huge Udokan copper deposit in Siberia.
The decision comes at a time when the Kremlin is seeking to reassert state control over strategically important sectors in a process many analysts said may put a brake on the investment needed to sustain the rapid economic growth of recent years.
It also reveals a major change of tack after the Kremlin invited a number of global majors--such as Britain's BP--to tap some of Russia's biggest national resource deposits.
Apart from Exxon, many foreign firms have expressed interest in Russia's mineral riches, including the world's No.3 gold company Barrick Gold , Britain's Highland Gold Mining and Kazakhstan's copper monopoly Kazakhmys.
Interfax news agency quoted a source in the Federal Natural Resources Agency as saying that "the government is interested in letting Russian companies develop strategic resources".
Separately, Natural Resources Minister Yuri Trutnev told Interfax that the foreign ownership issue will be dealt with according to Russia's competition law.
He gave no details, suggesting Russia could decide whether to allow foreign companies to bid on a case-by-case basis.
Foreign companies reacted with resentment. "We regret the ministry has taken such a decision. A closed tender limits competition for the right to develop a deposit for those who want and can do it efficiently," Highland Gold Deputy Chairman Ivan Kulakov told Reuters by email. "It would be a shame if that has a negative impact on the investment climate."
Analysts said the move was largely predictable as most countries tend to be protective when it comes to auctioning off big slices of their natural resources.

PARIS, Feb. 11--The Turkish economy and the cost to Turkish authorities of raising funds were given a helping hand on Friday with an upgrading by a leading credit rating organization, AFP reported.
The international ratings agency Moody's Investors Service upgraded the outlook on all ratings for Turkey to positive from stable in the light considerable economic progress since 2001.
Prospects for a significant deepening of economic, financial, and even political integration with the European Union were an additional consideration, Moody's said in a statement.
At the same time, Moody's upgraded the ratings on the government's Turkish lira-denominated instruments to "B1" from "B2" in recognition of improved domestic debt sustainability.
The positive outlook affected the "B1" foreign-currency country ceiling for debt, the "B2" foreign-currency country ceiling for bank deposits, and the "B1"-rated bonds and notes issued by the Republic of Turkey, regardless of currency denomination, the ratings agency said.
While it acknowledged that a heavy debt burden and a wide current account deficit remained sources of vulnerability for Turkey, Moody's said its positive outlook reflected both the way the economy has performed, with rapid disinflation, robust investment, and increased productivity, as well as the way it was managed, with political stability and responsibility in macroeconomic management.
Moody's ascribed the success of legislating profound socio-political reforms in recent years to the popular quest for EU membership. If, as seemed likely, the political leadership could remain unified for a lengthy period, the EU project would continue to support the continued modernization and convergence of the Turkish economy, Moody's said.
However, the agency added that Ankara still had to undertake difficult structural adjustments to secure lasting economic stability in addition to making painful political concessions to fulfill its EU ambitions, without any guarantee that these would definitely lead to full membership.

American industries suffered the lion's share of the estimated 25 billion to 30 billion dollars in global losses from illegal copies of films, software, video games and other copyright industries.

WASHINGTON,
Feb. 11--US copyright industries lost at least $13.4 billion to piracy in 2004, not counting illegal Internet copies, a business organization said Thursday, AFP reported.
The International Intellectual Property Alliance said American industries suffered the lion's share of the estimated 25 billion to 30 billion dollars in global losses from illegal copies of films, software, video games and other copyright industries.
The IIPA traced the problems to poor enforcement in 67 countries and said it was urging US authorities to place 42 of those on "an appropriate" list for review and possible trade sanctions.
The IIPA report will be sent to the US Trade Representative's office (USTR), which each year lists countries failing to provide adequate protection of copyrights.
The group, which includes the Motion Picture Association of America and organizations representing the music, book and software industries, said Russia, Pakistan and Ukraine are three major offenders for which action should be taken by Washington.
It called for consultations with China at the World Trade Organization and a special review of the growing piracy problem from that country.
IIPA singled out Russia as a priority and said Washington should immediately suspend special trade privileges granted to the country.
"Russia's copyright piracy problem remains one of the most serious in the world," the IIPA said in a statement. "Piracy rates for most sections are estimated at around 80 percent in 2004 and conservative estimated losses exceed $1.7 billion.Ó IIPA said Russia has failed to crack down on "some of the most open and notorious websites selling unauthorized materials in the world."
The organization said Pakistan should be added to the list of worst offenders along with Ukraine, the only country cited by USTR for sanctions last year. Both countries are believed to be major sources of illegal copies of optical disks including DVDs and CDs, with Pakistan also cited for book piracy, IIPA said.
The group called for 15 countries, including China, to be placed on a "priority watch list," and urged a special review of Chinese enforcement by July 31.
A report last year by the USTR cited 52 countries among 85 surveyed for shortcomings in protection of intellectual property. Of those, 14 were on the "priority watch list" along with the European Union.

Tony Blair

LONDON, Feb. 11--Prime Minister Tony Blair put economic well-being at the heart of Britain's general election campaign on Friday as he unveiled six pledges at the start of his Labour Party's last rally before an expected May vote, Reuters reported.
Hoping Britain's economic stability and prosperity will help win a third term, Blair began a whistle-top tour of the nation with a photo opportunity beside London's River Thames to unveil his first election promise: "Your Family Better Off." "We'll make sure the British people get the economy that we need," he said, promising to raise the minimum wage and help first-time buyers in the inflated housing market.
Finance Minister Gordon Brown, widely seen as Blair's rival for power and probable successor, also attended in a show of unity before the Labour Party's three-day Spring Conference.
"I believe that a Labour Government is the only government that can be trusted with the British economy," he said.
Labour tout Britain's unprecedented spell of 50 quarters of economic growth and an era of low interest rates, inflation and unemployment as proof they are the best stewards of the world's fourth largest economy.
But the opposition Conservatives say Brown has over-borrowed, kept taxes too high and failed to turn round Britain's creaking public services despite massive spending.
Conservative chairman Liam Fox said the pledges Blair was making--due also to cover health, education, childcare and crime--were "utterly worthless" given past broken promises.
"Whatever Tony Blair says today, why should anybody believe a single word he says?" he asked. "If you think back to what we got in 1997Ńeducation, education, education--but they have now got to defend the fact that a million pupils are playing truant from school."

BUENOS AIRES, Argentina, Feb. 11--Argentina said on Thursday creditors holding 37.3 percent of the government's defaulted debt had signed up for its mammoth debt swap as of Wednesday, 3-1/2 weeks into the offer, Reuters reported.
Economy Minister Roberto Lavagna said that as of last Friday, debt totaling $30.124 billion had been offered in the exchange but added that the total had risen due to more transactions being processed in the past three days.
He did not provide an updated dollar amount to reflect the most recent transactions.
"That figure plus the offers received until yesterday mean that to date we have received offers for 37.3 percent of the public debt in default," the Economy Ministry said in a statement issued after Lavagna gave a news conference.
On Monday, Lavagna said about 35 percent of holders of the defaulted debt had taken up the government's offer to swap their bonds for new paper in the first three weeks of the offer period, which ends Feb. 25.
And on Tuesday, Argentina said in a fax to the Italian securities regulator Consob that creditors holding $34.65 billion of the debt had signed up for the swap offer.
Argentina is offering up to $41.8 billion in three types of bonds in exchange for $81.8 billion in debt on which it defaulted in early 2002, or $102.6 billion including past due interest.
Three years after defaulting on its public debt, Argentina is trying to persuade creditors around the world to accept the biggest "haircut", or loss on principal, in modern times.
According to the government, of the new bonds demanded by creditors so far, 50.8 percent are in pesos, 30.5 percent in dollars, 17.9 percent in euros and 0.8 percent in yen.
Many creditors may be too tired to keep fighting for a better deal, but the Global Committee of Argentine Bondholders (GCAB), which says it represents around $40 billion in eligible debt, has launched a counter-offensive to convince investors to hold out and fight for a better deal in court.
GCAB co-head Hans Humes said on Thursday in New York that Argentina's offer may violate bilateral trade agreements and warned the group may launch an international challenge based on those pacts.

FRANKFURT, Germany,
Feb. 11--The managing director of the International Monetary Fund, Rodrigo Rato, called on the European Central Bank Friday not to raise its key interest rates at a time when the guardian of the euro appears increasingly concerned about inflationary dangers in the eurozone, AFP reported.
"The IMF views the danger of an acceleration in prices in the euro area currently as slight and therefore believes it possible that monetary policy can continue to be accommodative," Rato told the daily Frankfurter Allgemeine Zeitung in an interview.
The ECB has held its key rates steady at 2.0 percent since June 2003 and does not appear to be inclined to raising them for the time being, especially in view of the continued sluggishness of economic growth in the single currency area.
Nevertheless, a number of top ECB officials have recently expressed growing concern about surging property prices in some euro area countries, such as France or Spain, sparked by the low level of interest rates in the region.
"The combination of ample liquidity and strong credit growth could, in some parts of the euro area, become a source of unsustainable price increases in property markets," the ECB wrote in its February monthly bulletin published Thursday.
And the bank's chief economist Otmar Issing wrote in a newspaper column the same day that "an unsustainable change in asset prices sooner or later will present major risks for price stability."
Furthermore, the ECB in its latest monthly report no longer describes the outlook for price stability in the euro area as "favorable" as it had done in previous months.
In the newspaper interview on Friday, in which his comments were reproduced in German, Rato acknowledged that there was indeed a risk of speculative bubbles building up at a time when global interest rates are historically low.
"It is doubtless correct that in some cases investors are persuaded to neglect risks. The prices of some assets do therefore not adequately reflect the corresponding risks. We have to be vigilant," Rato said.