WORLD BRIEFS

WORLD BRIEFS

MIDDLE EAST

EGYPT

The government is planning two new ''special free zones'' in the northeast as part of its push for the dramatic rise in exports that is needed to boost economic growth and jobs.

The export-oriented free zones will be exempt from local customs duties, taxes and labor laws and regulations. Authorities hope the zones will attract a variety of commercial and manufacturing enterprises to Egypt.

The government expects the private sector to take the lead in developing and operating the zones. They are unlikely to be run under the auspices of the General Authority for Investment, but will be built on a build-operate-transfer basis or some variation thereof.

NORTH AMERICA

CANADA

Canada intends to accelerate talks with Latin America on forming a hemispheric trade zone. Prime Minister Jean Chretien, who led a trade mission to Latin America in December, said stronger ties with Brazil and other members of South America's four-nation Mercosur customs union are essential to seal creation of a Free Trade Area of the Americas.

Formal talks for the area are set to begin in Santiago, Chile, in April. Brazil is Canada's largest trading partner in Latin America, with two-way trade amounting to $1.75 billion in 1996, up from $1.68 billion in 1995 and $1.4 billion in 1994.

WESTERN EUROPE

NORDIC REGION

National tax authorities in Sweden, Norway, Finland and Denmark launched a concerted attack on what officials describe as multinational tax cheats.

Officials set up a special auditing unit to inspect the books of multinational companies operating in the region, and with subsidiaries registered in all four countries. The primary focus is on how these companies are repatriating profits.

A second area involves their interpretation of existing double-tax agreements. Phase one of the initiative covered 13 unnamed companies, seven of which are American, four British and two German-owned. It resulted in the issuing of tax bills totaling $160 million.

Phase two, which began this month, focuses on the books of another 17 companies.

ASIA-PACIFIC

VIETNAM

The Ministry of Planning and Investment says its new rules would ease bureaucratic obstacles, improve regulatory consistency, and clarify details of taxation and the areas in which investment was encouraged.

The spokesman for the ministry, calling the investment decree promulgated late January a ''first step'' toward improving the country's investment environment, conceded it was aimed primarily at helping existing investors rather than attracting new ones.

''We have a saying in Vietnam, that when you use a bait, don't end up catching its shadow. We are trying to focus on those investors already in Vietnam,'' said Nguyen Nhac, deputy minister.

Of the $32 billion Vietnam has received in pledged investment since 1988, just $11.878 billion had been implemented by the end of last year.

CENTRAL/EASTERN

EUROPE

ROMANIA

The Senate approved a bill strengthening surveillance of the shaky banking sector by, among other things, making international audits compulsory.

The measure now needs to be reconciled with a version passed by the lower house of parliament late last year. There also was more tinkering with the tax system, as the government continued to emphasize indirect over direct taxation.

Among the major changes, the highest income tax rate - of 60 percent, for earners pulling in more than 2.5 million lei ($300) monthly - was slashed to 45 percent.

LATIN AMERICA/

CARIBBEAN

ECUADOR

Hopes for economic recovery are pinned on a new government that is expected to take office in August.

While the outcome of May's presidential election is uncertain, the market-oriented Partido Social Cristiano will continue to dominate Congress. Most foreign firms will be inclined to defer investments in the country, at least until the new administration's economic policies become clear.

Nonetheless, 1998 should yield investment opportunities in several industries, including telecommunications, mining, energy and infrastructure.

The special national assembly, currently writing a new constitution, is expected to provide greater guarantees for private participation in the economy, but the rules of the game will remain murky while corruption in the public sector and judiciary prevails.

AFRICA

SOUTH AFRICA

President Nelson Mandela said South Africa will continue to privatize some state assets and eliminate remaining foreign-exchange controls, which currently affect residents but not foreign investors.

He underlined the need to cut the state's labor force, warning that the proceeds of privatization cannot be used to fund salaries and other consumption expenditures.

Congress of South African Trade Unions leader Sam Shilowa promised that his federation, the most powerful labor body in the country, would not automatically fight Mr. Mandela's plans.