Canada cautious on liberalizing foreign investment

By Randall Palmer, David Ljunggren and Louise Egan

OTTAWA (Reuters) - Canada will be cautious about liberalizing foreign investment rules for sensitive economic sectors because it's very hard to reverse a decision once it's been made, Industry Minister Christian Paradis said in an interview on Monday, meanwhile insisting that Canada remains open to foreign investment.

"When you decide to go with these kinds of reforms, you cannot ratchet down after that. You can ratchet up but not down," said Paradis, who is the government minister responsible for foreign investment rules.

Canada has strict rules governing foreign stakes in industries such as banks, telecommunications and airlines, as well as more general tests to determine if foreign takeovers are beneficial to Canada.

But the issue remains controversial. Paradis' predecessor unexpectedly blocked a 2010 foreign takeover offer for fertilizer giant Potash Corp, and the government last year spent several months mulling its response to an offer for oil company Nexen Inc from state-owned Chinese oil company CNOOC Ltd.

Ottawa eventually allowed the Nexen takeover, but imposed strict new restrictions on future bids by state-owned companies, particularly for companies in the Alberta oil sands.

One Canadian company widely viewed as a potential takeover target is BlackBerry, which is struggling to compete against Apple's iPhone and devices using Google Inc's Android operating system.

Paradis said he hopes BlackBerry will remain a national champion. But he said he did not know what would happen to the mobile device maker, given the unforgiving competition in the global telecommunications industry.

"We never know what can happen but I've said - and I truly believe this - I hope BlackBerry will continue to be a Canadian champion in the world, that it grows organically," Paradis said in his office in the Industry Canada building in Ottawa.

"This is my opinion here. But that being said, we don't know what might happen. The market is very aggressive. When you talk about the telecoms sector ... this is a very, very aggressive sector."

The head of China's Lenovo Group Ltd told a French newspaper last week that the firm might consider an acquisition of BlackBerry at some point in the future.

Paradis said the Canadian government would examine any Lenovo bid using its national security guidelines, which are designed to block foreign governments from gaining control over strategically important firms.

"As the industry minister I don't want to send a signal and I don't want it to look like I prejudged a deal or not," he added.

Some of the government's foreign investment policy has been guided by a 2008 official report that urged Ottawa to liberalize, or consider liberalizing, foreign investment rules in telecommunications and broadcasting, the airline industry and in uranium mining, and to allow mergers in the financial industry.

Paradis has lifted restrictions on foreign investment in telecommunication providers with less than 10 percent of the market. But he noted that the 2008 report advocated a broad review before opening the sector up further or allowing more foreign investment in broadcasting.

"We are not there at this point," he said.

However, Paradis hinted at the possibility of a bigger opening to foreign investment if current measures to boost telecom competition fail to bring lower prices and more choice for consumers: "We cannot guarantee we will achieve what we want to achieve in terms of goals, when you talk about competition."

Paradis said he was "very happy" to see growth in the hard-hit manufacturing sector and noted that he was hearing fewer complaints recently about the strength of the Canadian dollar, which hurts exporters.

"We used to hear that more in the past than now, to be blunt," he said.

"Wherever I go, we all agree that it's unlikely that the Canadian dollar will go down as it used to be, so if people are relying on this to increase their competitiveness, it's not the way to do it," he said. "We should not rely on this."

The Canadian dollar rose by nearly 45 percent between a trough in early 2002 and a peak in late 2007, but has held steady at close to parity with the U.S. dollar in the last few years.

Paradis noted that manufacturers have benefited from a measure allowing them to accelerate writedowns on capital investments, but he could offer no guarantees the upcoming federal budget would extend the program.

"It added a lot of leverage in the past and I heard a lot of good comments in the multiple roundtables in the last months, for sure," he said.

Asked about the government's likely response to a possible foreign bid for a company such as natural gas producer Encana Corp, Paradis pointed out that bids by state-owned firms would still be evaluated for the degree of influence a company has over the industry and the sector it is involved in, and the degree of influence the foreign government has over the company.

Encana said last month it did not believe that revised government rules on foreign takeovers would prohibit it from being acquired.

(Editing by Janet Guttsman and Peter Galloway)

View the original article here

Italy says 7 foreign hostages killed in Nigeria

KANO, Nigeria (AP) — Italy's foreign ministry said Sunday that seven foreign hostages kidnapped in northern Nigeria had been killed as claimed by Islamic extremists, the worst such foreign abduction violence to hit the turbulent West African nation in decades.

Greece also confirmed one of its citizens had been killed by Ansaru, the radical group that claimed responsibility for abducting the foreigners from northern Bauchi state in Feb. 16. Authorities in Lebanon and the United Kingdom have yet to comment publicly, while Nigerian officials could not be immediately reached for comment Sunday.

"It's an atrocious act of terrorism, against which the Italian government expresses its firmest condemnation, and which has no explanation, if not that of barbarous and blind violence," a statement from Italy's foreign ministry read. Italy also flatly denied a claim by Ansaru that the hostages were killed before or during a military operation by Nigerian and British forces, saying there was "no military intervention aimed at freeing the hostages."

A statement from Greece's foreign ministry said authorities had already informed the hostage's family.

"We note that the terrorists never communicated or formulated demands to release the hostages," the statement read, which also denied any military raid took place.

Ansaru previously issued a short statement saying its fighters kidnapped the foreigners Feb. 16 from a construction company's camp at Jama'are, a town about 200 kilometers (125 miles) north of Bauchi, the capital of Bauchi state. In the attack gunmen first assaulted a local prison and burned police trucks, authorities said. Then the attackers blew up a back fence at the construction company's compound and took over, killing a guard in the process, witnesses and police said.

The gunmen appeared to be organized and knew who they wanted to target, leaving the Nigerian household staff at the residence unharmed, while quickly abducting the foreigners, a witness said. Local officials in Nigeria initially identified one of the hostages as a Filipino, something the Philippines government later denied.

In an online statement Saturday claiming the killings, Ansaru said it killed the hostages in part due to local Nigerian journalists reporting on the arrival of British military aircraft to Bauchi, the northern state where the abductions occurred. However, the online statement from Ansaru said the airplanes were spotted at the international airport in Abuja, the nation's capital.

The British Ministry of Defense said Sunday that the planes it flew to Abuja ferried Nigerian troops and equipment to Bamako, Mali. Nigerian soldiers have been sent to Mali to help French forces and Malian troops battle Islamic extremists there. The British military said it also transported Ghanaian soldiers to Mali the same way.

The British ministry declined to offer any other comment regarding Nigerian extremist group's claims that it killed the seven hostage killings. Ansaru had said it believed the planes were part of a Nigerian and British rescue mission for the abducted hostages.

The U.K. has offered military support in the past in Nigeria to free hostages. In March 2012, its special forces backed a failed Nigerian military raid to free Christopher McManus, who had been abducted months earlier with Italian Franco Lamolinara from a home in Kebbi state. Both hostages were killed in that rescue attempt.

In its statement Saturday, Ansaru also blamed the killings on a pledge by Nigerian President Goodluck Jonathan to do "everything possible" to free the hostages. Presidential spokesman Reuben Abati could not be immediately reached for comment.

While Nigerian authorities have yet to comment publicly about Ansaru's claim, it comes as the nation's security forces remain unable to stop the guerrilla campaign of bombings, shootings and kidnappings across the country's north.

In January 2013, Ansaru declared itself a splinter group independent from Boko Haram, the north's main Islamic terrorist group, analysts say. Boko Haram, whose name means "Western education is sacrilege," has launched a guerrilla campaign of bombings and shootings across Nigeria's predominantly Muslim north. Boko Haram is blamed for at least 792 killings last year alone, according to an Associated Press count. An online video also purportedly claims that Boko Haram is currently holding hostage a family of seven French tourists who were abducted from neighboring Cameroon in late February.

___

Associated Press writers Frances D'Emilio in Rome, Demetris Nellas in Athens, Greece, and Sylvia Hui in London contributed to this report.

___

Jon Gambrell can be reached at www.twitter.com/jongambrellAP.

View the original article here

Nigeria: Video shows bodies of foreign hostages

KANO, Nigeria (AP) — A video posted online appears to show the corpses of some of the seven foreign hostages abducted by Islamic extremists in northern Nigeria and later killed, a gruesome warning of the growing dangers in the region.

The video, viewed by The Associated Press on Monday, matched still images released earlier by the Islamic extremist group Ansaru when it claimed the killings. The face of one of the corpses in the video also resembled that of one of the hostages already named by authorities.

European diplomats said Sunday that the hostages had been killed.

On Monday, Nigerian Interior Minister Abba Moro told the BBC's Hausa language radio service that those nations said that it was "likely" that their citizens had died in the attack.

"We hope they're alive," Moro said. Moro did not respond to requests for comment Monday from the AP. Nigerian officials often speak to the BBC Hausa service, as it is viewed as one of the dominant independent news sources in Nigeria's predominantly Muslim north.

In the video, a gunman stands in sand, holding a rifle near what appears to be dead bodies. A later shot in the video shows three male corpses, one of whom appears to have been killed by a gunshot wound to the head from a high-powered weapon.

The video has no sound. An accompanying caption for the video in Arabic calls it: "The killing of seven Christian hostages in Nigeria." Another description includes the statement Ansaru released Saturday claiming that it killed the hostages, signed by a man with the nom de guerre Abu Usamatal Ansary.

Ansaru fighters kidnapped the foreigners Feb. 16 from a camp for the construction company Setraco at Jama'are, a town 200 kilometers (125 miles) north of Bauchi, the capital of Bauchi state. In the attack, gunmen first assaulted a local prison and burned police trucks, authorities said. Then the attackers blew up a back fence at the construction company's compound and took over, killing a guard in the process, witnesses and police said.

Those kidnapped included four Lebanese and one citizen each from the United Kingdom, Greece and Italy. Local officials in Nigeria initially identified one of the hostages as a Filipino, something the Philippines government later denied.

The gunmen appeared to be organized and knew who they wanted to target, leaving the Nigerian household staff at the residence unharmed, while quickly abducting the foreigners, a witness said.

In an online statement Saturday in which it claimed the killings, Ansaru said it killed the hostages in part because of reports in the Nigerian press of the arrival of British military aircraft to Bauchi. However, the local news articles cited by Ansaru reported that the airplanes were spotted at the international airport in Abuja, the nation's central capital 180 miles (290 kilometers) southwest.

The British Defense Ministry said Sunday the planes it flew to Abuja ferried Nigerian troops and equipment to Bamako, Mali. Nigerian soldiers have been sent to Mali to help French forces and Malian troops battle Islamic extremists there. The British military said it also transported Ghanaian soldiers to Mali the same way. Ansaru had said it believed the planes were part of a Nigerian and British rescue mission for the abducted hostages.

Nigerian authorities have yet to comment publicly about Ansaru's claim, and the news of the killing of the hostages comes as the nation's security forces remain unable to stop the guerrilla campaign of bombings, shootings and kidnappings across the country's north. The majority of those attacks have been blamed on Boko Haram, an Islamic extremist group that grew out of the remains of a sect that sparked a riot and a security crackdown in Nigeria in 2009 in which about 700 people were killed.

Boko Haram has hit international targets before, including an August 2011 car bombing of the United Nations office in Abuja that killed 25 people and wounded more than 100. An online video also purportedly claims that Boko Haram is currently holding hostage a family of seven French tourists who were abducted from neighboring Cameroon in late February. The group is blamed for killing at least 792 people last year alone, according to an AP count.

Ansaru, which analysts believe split from Boko Haram in January 2012, seems to be focusing much more on Western targets. Analysts say it has closer links to al-Qaida in the Islamic Maghreb and cares more about international issues, as opposed to Boko Haram's largely local grievances. But much remains unknown about Ansaru, which has communicated through short, sometimes muddled online statements.

The hostage killings appear to be the worst in decades targeting foreigners working in Nigeria, an oil-rich nation that's a major crude supplier to the United States. Most kidnappings in the country's southern oil delta see foreigners released after companies pay ransoms. The latest kidnappings in Nigeria's north, however, have seen the hostages killed either by their captors or in military raids to free them, suggesting a new level of danger for expatriate workers there.

___

Associated Press writer Sunday Alamba contributed to this report.

___

Jon Gambrell can be reached at www.twitter.com/jongambrellAP .

View the original article here

Mexico reverses foreign investment flows

MEXICO CITY (AP) — After decades of depending on inflows of foreign capital to develop its economy, Mexico has turned a corner and become a net exporter of direct investment capital in 2012.

Mexico's central bank announced Monday that Mexican corporations invested about $25.6 billion last year in buying up foreign plants and companies, more than twice the $12.7 foreigners invested directly in Mexican firms.

For a country that still has one foot planted firmly in the developing world, that news worried some analysts and delighted others.

An official confirmed that was the first time in recent memory that outflows exceeded inflows.

Last year was marked by big purchases of European telecom assets by Mexican magnate Carlos Slim, considered the world's richest man.

View the original article here