Hard Money Loans

Asian stocks climbed, driving the region’s key benchmark index to its first advance in eight weeks, as concern Europe’s debt crisis will hurt earnings of exporters and banks eased and the Federal Reserve said it is prepared to provide further stimulus to the U.S. economy if needed.

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Asian stocks rose, driving the region’s key index up for a second day as Greek Prime Minister George Papandreou won a parliamentary confidence vote, moving the country a step closer to avoiding a default on its debt.

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A year after European officials bailed out Greece, investors say the region’s banks haven’t raised sufficient capital or cut loans enough to withstand the contagion that may follow a default

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European Union stress tests on the region’s banks are becoming “irrelevant” because they ignore the possibility of a default by Greece.

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MetLife Inc., the largest U.S. life insurer, said it’s weighing acquisitions in Latin America as ING Groep NV considers selling its business in the region.

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Tel Aviv, Israel (TML) – Western powers and their allies in the Middle East hope to grease the wheels of democracy and political stability as they begin to release billions of dollars in loans and other financial aid to the region’s Arab Spring economies.

The economies of countries like Egypt, Tunisia and Jordan are facing a near-perfect storm of political unrest combined with negative growth and rising prices for imported energy and food. But the emerging aid pipeline may be clogged by domestic opposition inside donor countries. Recipients may balk at the conditions placed on much of the aid.

Aid could ease the way for Egypt and Tunisia to evolve into Western-friendly democracies as well as give a boost to beleaguered friends like Jordan’s King Abdullah. Without it, deteriorating economic conditions risk strengthening the hand of already powerful Islamic movements and undermining public confidence in the free markets and private business that economists say are needed to ensure long-term prosperity.

“These countries, particularly Egypt, face a financial hole and their economies have come to a standstill. The way out is to spend money which their governments don’t have,” said Paul Rivlin, author of Arab Economies in the Twenty-First Century. But the recipients will have to show they are taking the right political and economic measures. “The U.S wants to draw them back into a Western orientation. But the political systems in these countries may draw them elsewhere.”

Egypt, as the biggest of the Middle East’s troubled economies and the country most likely to set the direction of the region political, is the focus of the aid.

The International Monetary Fund (IMF) kicked off the effort May 12, saying it would respond to Egypt’s request for as much as $12 billion. That amount has since has been lowered to $4 billion. But in the meantime, U.S. President Barack Obama last week offered to forgive some $1 billion in Egyptian debt and. Egypt is reportedly close to an agreement with the World Bank to receive loans worth $2.2 billion.

But the biggest largesse of them all may come from Saudi Arabia, which on Saturday pledged $4 billion in the form of soft loans, deposits and grants, the Egyptian Middle East News Agency (MENA) reported, citing Field Marshal Mohamed Hussein Tantawi, the head of Egypt’s ruling military council, as saying.

Egypt won’t be the only beneficiary of international aid.

On Saturday, the European Bank for Reconstruction and Development (EBRD), which was formed to smooth eastern Europe’s transition to free market democracies, is working on a program that may eventually lead to investment of as much as 2.5 billion euros ($3.5 billion) a year in the Middle East. The EBRD said it is considering a request by Egypt to become a country of operations. Morocco, another EBRD shareholder, has also expressed an interest in qualifying, it said.

On Monday, the Group of Eight (G-8) – a forum for many of the world’s biggest economies – will discuss how they can contribute to modernizing the economies of the Middle East, without pledging dollar amounts for assistance. A special session will be devoted to Tunisia and Egypt.

Tunisia plans to attract $5 billion a year in foreign aid, loans and private investments over the next five years during meetings at the G-8 summit, Finance Minister Jelloul Ayed said in an interview with The Wall Street Journal Friday. Tunisia would apply for a $500 million standby loan, possibly from the World Bank.

Obama told a visiting King Abdullah that he would provide Jordan with several hundred millions of dollars in aid, channeled through the Overseas Private Investment Corp. (OPIC). Obama said the funds would “leverage ultimately about $1 billion for economic development in Jordan.”

Rivlin said Washington will lead the aid drive and should America judge that the Arab Spring economies aren’t meeting its conditions it “will be difficult” for Europe and international institutions to provide it either.

The Arab Spring economies are in bad shape by almost every measure. The five countries hit hardest by turmoil will show a combined drop in economic output of about 2.3% this year, according to figures based on a forecast by the Institute for International Finance (IIF) released in early May.

Egyptian Finance Minister Samir Radwan estimates his country’s budget deficit will top 10% of gross domestic product in the coming fiscal year, up from a previous forecast of 7.9% and has to borrow to cover the gap. Its official foreign currency reserves have fallen to $28 billion, but some economists think the drop is bigger than being report.

Uri Dadush and Marwan Muasher, from the Carnegie Endowment for International Peace, expressed concern that it will be difficult to convince the leaders of Egypt and other recipient countries to undertake the economic reforms needed to rekindle economic growth and enable them to eventually get off aid.

So far, the transitional governments of the region, as well as veteran leaders trying to retain power, have increased subsidies for consumer goods and promised to create jobs, all at a cost to badly strained budgets and economic efficiency. But Dadush and Muasher add that the bigger problem may be convincing Arab public opinion that free markets are beneficial.

“Change in the Middle East is about refusing an autocratic political system and calling for democracy – without a clear vision for what economic system should be put in place,” they wrote in the National Interest on April 13. “There is a significant possibility that the governments that ultimately emerge out of this crisis will renounce previous economic reforms as misguided.”

Indeed, many analysts think Egypt won’t agree to the economic reforms the IMF typically demands in exchange for its aid, such as subsidy cuts, for fear that they will spark another round of mass protests like the kind that brought down President Husni Mubarak in February.

“For understandable political reasons, the Egyptian government says that it is unthinkable to cut subsidies for food or energy. But can the IMF simply extend a loan without any conditionality? I doubt it,” Gideon Rachman wrote in the Financial Times last week.

Back at home, both American and European leaders will have to make a case for sending billions of dollars overseas at a time when they are experiencing severe economic difficulties of their own. Europe is trying to put out debt fires in Greece, Portugal and Ireland.

In the U.S., President Barack Obama is battling Congress over increasing the country’s debt ceiling. He faces opposition from a Republic-controlled House of Representatives to helping countries whose allegiance to America is more in doubt as long-time pro-Western despots are replaced by governments whose views are yet to be fully articulated.

The U.S. budget is weighed down by $14 trillion in debt as the White House and Congress fight over raising the national debt ceiling.

“Considering our own national debt, we cannot afford to forgive up to $1 billion of Egypt’s debt,” Elena Ros-Lehtinen, the chairwoman of the House Foreign Affairs Committee, said last Thursday. “The U.S. should only provide assistance to Egypt after we know that Egypt’s new government will not include the Muslim Brotherhood and will be democratic, pro-American and committed to abiding by peace agreements with Israel.”

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MOMBASA, Kenya (IRIN) – When police in Kenya’s coastal tourist city of Mombasa conduct night raids, it is not unusual for a large number of sex workers arrested to be under 18.

The government faces a struggle to end a trade that many young girls see as a fast way out of poverty and into a more glamorous life.

Munirah* spends her days looking for customers at the city’s Kenyatta Public Beach. Just 15, she already has one child and is the sole breadwinner for her household.

“My widowed mother lost both her hands while working at a steel processing factory in Mombasa, forcing me to do what I am doing,” she told IRIN/PlusNews.

Munirah says she has been selling sex for six months and has already slept with several men, mainly tourists. Most of her clients prefer sex without a condom. When asked if she was aware of the risks of HIV, she shrugged and admitted she had never been for an HIV test.

According to Grace Odembo, a field coordinator with the NGO, Solidarity with Women in Distress, SOLWODI, many of the girls on the streets have limited formal education and therefore little chance of gainful legal employment.

She said “beach boys” – young men who hang around the beaches – acted as pimps for tourists seeking young girls and were paid handsome commissions, fuelling the cycle of child sex work.

“This large number of small girls you see loitering along the beaches looking for wazungu [white men] and even those engaging in legitimate businesses such as selling curios… they fall prey to beach boys who [tell] them they’ll be introduced to perfect rich suitors, only to have them end up in the arms of sex pests instead,” Odembo said.

According to a 2006 study by the government and the UN Children’s Fund, as many as 30 percent of teenage girls in the coastal towns of Diani, Kilifi, Malindi and Mombasa were involved in casual sex work. More than 10 percent of girls began transactional sex before the age of 12.

The study also found that 35.5 percent of all sex acts involving children and tourists took place without condoms.

In 2004, Kenya introduced the “Code of Conduct for the Protection of Children Against Sexual Exploitation in Travel and Tourism” to create awareness and prevent commercial sexual exploitation of children. However, the code seems to have done little to deter tourists seeking sex with minors.

Members of Kenya’s tourism sector say poverty is the main reason young girls turn to sex work, and why it is so difficult to fight the phenomenon.

“The parents, most of whom happen to be poor, instead encourage their daughters [to sell sex] so as to supplement their family earnings,” said Titus Kangangi, chairman of the Kenya Association of Hoteliers. “In many cases, a guardian sides with the accused whenever sexual abuse charges are brought.”

Out of court settlements are the norm in such cases, with tourists paying off families of young girls to avoid jail terms.

Action needed

Tourism Minister Najib Balala told IRIN/PlusNews it was important to rid the coast of its reputation of a haven for child sex tourism.

“This embarrassing tag must be dealt with right from the community level; it is a cartel that needs so much attention if we have to win,” he said. “It has cost the region and country credible tourists and investors, who now see the country as a sex destination.”

Balala said the government was putting more effort into adhering to the code of conduct by cancelling the business licences of establishments allowing tourists to check in with underage girls.

SOLWODI counsels young women and offers alternative incomes through microfinance loans. However, its resources are limited and for many girls, the small loans from NGOs are no match for the income they earn from wealthy tourists.

Poverty is key

Odembo said the government needed to be more vigilant in keeping young girls off the streets. “The government needs to come up with enough rescue centres within the region,” she said. “They should also get to the bottom of why a child found loitering in the beach isn’t attending school.”

According to James Weru, programmes director for the NGO, African Pro-poor Tourism Development Centre , tackling poverty is key to ending child sex tourism.

“Tourism is one of Kenya’s biggest income earners, but less than 20 percent of this income trickles down to local economies and as a result, locals remain very poor,” he said. “The government needs to spread the income out to benefit the locals so that there is less temptation to go into sex work.”

He noted that it would also be important to enforce adherence to the code of conduct and to back this up with serious legal consequences for defaulters.

“We also need to carry out education for tourists and ensure that we are getting the right kind of tourists,” Weru added. “Many governments have lists of paedophiles who are blacklisted from entering their countries, but we have no such measures in Kenya.”

jk/kr/mw

*Only one name used to protect the child’s identity

– Provided by Integrated Regional Information Networks.

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Deutsche Bank AG, which won 2011′s biggest Scandinavian corporate-finance deal when it led DuPont Co.’s bid for Danisco A/S, is boosting its Nordic unit as the pace of mergers in the region tops that of Europe and the U.S.

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Abu Dhabi, United Arab Emirates David Rosenberg – Economic growth is returning to the Middle East, but not quite at the pace of the go-go years of soaring oil prices and massive real estate development.

An International Monetary Fund report released Sunday estimated the combined economies of the region stretching from Morocco to Pakistan would expand by 4.2 percent this year, almost double the pace of 2009. They will grow even faster in 2011, with the region clocking an expansion of 4.8 percent.

“We expect most countries in the region to grow faster in 2010 and 2011 than in 2009,” Masood Ahmed, director of the IMF’s Middle East and Central Asia Department, said in a press release.

Although the global financial crisis took down the region’s highest flying economies, most of the Middle East weathered the worst economic contraction well. The world economies shrank 0.6 percent in 2009 as the impact of bad home loans in the U.S. reverberated through the world’s financial markets. In the Middle East, economies continued to expand, albeit at a pokier 2.3 percent pace.

The Middle East’s oil exporters will likely see economic growth pick up to 3.8 percent from 1.1 percent in 2009 as oil prices climb to an average of $76 a barrel, according to the Washington, DC-based IMF. In 2011, the rate of growth will probably accelerate to 5 percent as oil prices average $79 a barrel. Still, that leaves the oil economies growing at a slower pace than in the pre-recession years.

Oil exporters remain too vulnerable to fluctuations in the global price of petroleum, which traded at $82.10 on Friday. While not all Middle East’s big oil exporters are that heavily dependent on oil for economic output, they all rely on oil revenue for half or more of their government budgets.

For the Middle East’s oil importers, the pick-up in growth will be less dramatic. GDP growth will reach 5 percent this year, a 0.4 percentage point improvement over 2009, before slowing to 4.4 percent in 2010, the IMF report said. Egyptian GDP growth will show steady improvement this year and next, although well below the pre-recession rates when growth exceeded 6.5 percent annually. Pakistan, reeling from the impact of floods last summer, will see economic growth slow considerably from previous forecasts.

The IMF report warned that as strong as the recovery has been for the region, it is still not enough to provide jobs for the Middle East’s large and growing population of young people. It estimated that half the population is under age 25 while the average jobless rate in 2008 was 11 percent. For the region to create enough jobs, its combined economy would have to grow 6.5 percent annually over a sustained period, something it has never managed to do.

“There is now a recovery happening in the emerging markets in the region,” Ahmed said at a forum in Dubai. “But they are not growing fast enough to create the jobs they need.”

The Middle East needs 18.5 million jobs over the next decade, about 7 million more than it will create if it keeps to its previous rate of growth, the IMF said, admitting this was a “tall order.”

For all its oil wealth, the Middle East lags behind the world’s emerging economies. Since 1990, GDP has increased 55 percent for the Middle East, North Africa and Pakistan, but the emerging Asian economic powers have boosted their output by 200 percent in the same period, the IMF said. The region’s governments can accelerate economic growth by paring back on government regulation and privatizing state-owned enterprises and liberalizing labor markets. The Middle East also needs to redirect more of its trade from the slower-growth economies of Europe to burgeoning Asia, it said.

Inflation is also rearing up in some Middle East countries, the IMF warned. In Saudi Arabia it accelerated from 3.5 percent in October 2009 to 6.1 percent last August. In Iran, consumer prices were moderating until recently – showing from a 30 percent rise at the end of 2008 to 7 percent a year ago. But they have since begun rising to a 10 percent annual rate in the first quarter of 2010, the IMF report said.

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When you start the process of buying a home or any type of real estate, you’ll no doubt hear the term “earnest money deposit” (EMD). So what exactly is an EMD?

An EMD becomes relevant when you are ready to make an offer on a property. In most states, your Real Estate Agent prepares the offer on your behalf. The offer usually takes the form of a written contract that is submitted to the seller by way of their agent.

In addition to the offer document, sellers typically expect an EMD. An EMD is a monetary deposit submitted via check to demonstrate to the seller that you are a serious buyer. In some regions of the country, only a photocopy of the check is submitted with the offer, and the original check is delivered to the appropriate entity if the offer is accepted. Ask your Real Estate Agent to clarify how deposits are handled in your region of the country.

The check is usually made out to an independent third- party such as a Title Company, Escrow Company, Real Estate Attorney or your Real Estate Broker. Ask your Real Estate Agent to clarify who will hold the EMD.

The amount of the EMD sellers expect varies by region. The EMD amount is based on the customs and practices for a region, but is generally from 1% to 2% of the purchase price. In a competitive market place where demand exceeds the supply of homes, some buyers may offer a higher EMD than expected to impress the seller of their intent. In determining the amount of your EMD, consult your Real Estate Agent and balance the need to demonstrate your serious intent, against the good business practice of minimizing the deposit amount.

The amount of the EMD is usually applied to reduce the purchase price of the property or to cover closing costs, as you dictate. For example, if you are purchasing a $300,000 property and you give an EMD of $3000, then the remaining balance owned at closing is $297,000 (plus closing costs). Alternatively, you may direct that the EMD be applied toward the closing costs.

Once a valid contract for purchase is created, an independent third-party usually holds the EMD until the purchase is either completed or cancelled. At this point, the money belongs jointly to both the seller and the buyer.

In cases where you make an offer that is accepted but later decide to cancel the offer, the terms specified in the contract (or state law) will dictate if, and under what circumstances, the EMD is returned to you. Be aware that you could loose your deposit if you do not not comply with the terms of your contract. Your Real Estate Agent can provide you information about how EMDs are dealt with if a contract is cancelled.

Since state law varies by region and practices can differ even within the same state, be sure to consult your Real Estate agent about the rules that apply to EMDs in your region of the country. You should also be aware that the EMD is not related to any down payment that you make toward your home loan.