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KPMG and Ernst Young drop merger planMajor auditing firms KPMG and Ernst Young announced Friday that they have quot;decided jointly to halt...

KPMG and Ernst Young drop merger plan

Major auditing firms KPMG and Ernst Young announced Friday that they have quot;decided jointly to halt the merger between their two organizations quot; because of the numerous probes being made by authorities. They said in a joint communique that quot;The requests made by supervisory authorities leading to investigations of the merger in the United States, Europe, Australia, Switzerland, Canada and Japan would have taken months and entailed substantial costs as well as considerable interference with services for our clientsquot;. Moreover, quot;one cannot rule out the possibility of different decisions by the various agenciesquot;.

Those problems, quot;together with the costs and resources required to blend the two organizations8217; cultures make it impossible to carry out the mergerquot;.The two groups are among the world8217;s quot;Big Sixquot; in the audit field, the others being Arthur Andersen, Deloitte Touche Tohmatsu International, Price Waterhouse and Coopers/Lybrand.

The merger would havecreated the world8217;s biggest audit group, with total fees of 18.3 billion a year and some 12,800 partners, according to the two companies8217; figures.

Asian crisis hits China8217;s exports

Asia8217;s Financial crisis hit China8217;s exports for January with sales of goods to its Asian neighbours down 1.4 per cent over the same month last year, the China Daily said.

Chinese exports to Asia fell to 6.99 billion, including a 6.4 per cent plunge in exports to South Korea to 440 million, the paper said. Sales of Chinese goods to nine Southeast Asian countries decreased 4.2 per cent to 780 million.

However, total exports actually increased 8.8 per cent in the month to 12. 68 billion. Exports were up 14.3 per cent to North America, 33.7 per cent to Europe and 42.9 per cent to Africa, the China Daily said. Imports in January declined 12.9 per cent to 8.69 billion.

Bosnia firm gets investment guarantee for political risk

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Bosnia8217;s Investment Guarantee Agency IGA has just issued its first politicalrisk guarantee on business transactions in Republica Srpska, the Bosnian Serb entity, the World Bank announced.

The IGA, created under a World Bank credit and co-financed by Switzerland, Sweden, Japan and the Netherlands, offered a 2.1-million guarantee to Siemens A.G ., which will supply medical equipment and supplies to hospitals in the republic.

The agency has been active in Bosnia-Hercegovina for about a year and has offered guarantees worth around 16 million to 10 companies involved in such projects as rebuilding Sarajevo airport and the supply of power plant equipment.

The IGA protects foreign providers of goods and equipment from political risk on the credit they extend to local buyers.