Groupon's stock price plunged more than 14 percent to $21 a share in after-hours trading that followed release of the earnings figures, which disappointed investors who had expected the young company to show a profit.

"Groupon had a strong fourth quarter and we finished 2011 having helped 250,000 local merchants across 47 countries grow their businesses while saving Groupon customers billions of dollars," said chief executive Andrew Mason.

"We will continue to invest in new services and tools that help our merchant partners be more successful and drive local commerce around the world," the Chicago-based company's co-founder added.

Groupon revenue climbed to $506.5 million, a 194 percent increase from the same quarter a year earlier.

The company had a net loss of $42.7 million as compared with a $378.6 million loss in the final three months of 2010. Groupon trimmed about $100 million from its loss figure in the prior quarter to end the year $350.85 million in the red.

Groupon said the profit miss resulted from an unexpectedly high overseas tax rate prompted by the opening of an international headquarters in Switzerland.

Investor chagrin was heightened by a forecast that Groupon revenue in the current quarter would rise only slightly in a possible sign that the daily deal craze may be ebbing.

Groupon shares were listed on the Nasdaq at $20 on November 4 in a blockbuster public offering that raised a whopping $700 million and triggered fears that investors may be foolishly overvaluing hot Internet startups.

Shares of the company soared as high as $31.14 on the first day of trading but they have lost ground since then.

Groupon, which rejected a $6 billion takeover offer from Google a year ago, has enjoyed phenomenal growth since its founding in 2008 but has been dogged by questions about its business model and accounting methods.

Groupon chief financial officer Jason Child predicted that the company would be profitable in all regions of operation "in the next year or two."

He said there were plans to roll the service out soon in more parts of Britain and the United States.

Groupon has more than a billion dollars in its coffers, due in large part to the success of the initial public offering, according to Child.

Mason opened an earnings call with analysts by saying Groupon had a "phenomenal year" and that "we are on the cusp of a sea change" in which technology will transform the way local commerce is conducted.

He touted the successes of a Christmas-themed promotion and said that more occasion-themed deals were in store. He added that an alliance with Expedia to offer travel deals under the banner of Groupon Getaways has been a hit.

"One thing that shocked us was the high percentage of purchases that came from mobile devices the weekend we launched Groupon Getaways," Mason said during the earnings call.

Groupon recently opened a Silicon Valley office and planned to "snap up" engineering talent as it invests in technology, according to the executives.

Mason closed his first quarterly earnings call with "This was a lot of fun; we look forward to many more of these."

]]> Thu, 09 FEB 2012 09:07:53 AEST Buenos Aires (UPI) Feb 8, 2012 - Argentina is putting its partnerships with Brazil and other Latin American neighbors on the line in its bid to cut imports in response to a trade downturn.

Argentine imports are suffering because of recent drops in international commodity prices but critics also fault President Cristina Fernandez de Kirchner for restrictive policies that discourage traders.

Amid frequent run-ins with landlocked neighbor Paraguay, Uruguay and now Brazil, the outlook for Argentine economy has been deteriorating, prompting forecasts of a shrinking trade surplus, industry reports indicated.

Argentina had a trade surplus of more than $10 billion in 2011 but is unlikely to match that figure this year, trade data indicated.

Disputes with Brazil and other neighbors are taking their toll on business morale, with the government dragged into confrontations with business and farmers' groups. The government's response to continuing drought didn't include relief measures for farmers, in contrast to generous emergency aid provided by Paraguay to its own distressed and drought-stricken farmers.

Drought has caused major harvest disruptions in Argentina, Brazil, Paraguay and Venezuela and affected neighboring countries as well.

More pressing than disputes over drought relief, however, is the developing crisis in trade relations between Argentina and Brazil. The two sides met several times in the past few weeks to seek a compromise but came away empty-handed.

At issue is new Argentine trade legislation that seeks to restrict imports from Brazil and tilt the trade balance in Argentina's favor. Trade volume between the countries totaled $5.8 billion in 2011 but Brazil was the main beneficiary.

In yet another attempt to defuse the crisis, Argentine Foreign Trade Secretary Beatriz Paglieri met with her Brazilian counterpart Tatiana Prazeres but the talks ended with a "good understanding" and no accord.

Despite the developing crisis, it will be another two weeks before Paglieri and Prazeres can meet again, officials said.

Brazil objects to additional procedural requirements introduced in the new Argentine trade regulation. Before the ministers met, Brazilian trade leaders, including Sao Paulo State Industrial Federation President Paulo Skaf had talks with senior Brazilian government officials, including Economy Minister Hernan Lorenzino, to defuse the crisis. He, too, went back to Brazil empty-handed.

Brazil is already having difficulties with its export markets because of the overvaluation of the real, a result of major cash infusions into the Brazilian economy from overseas investors. Brazil is keen to avoid a confrontation with Argentina over a trade dispute and to retain all its export customers on good terms.

The developing dispute has also clouded the outlook for talks between the European Union and the Mercosur trade bloc, of which both Argentina and Brazil are key members. Previous EU efforts to build bridges with Argentina were thwarted by what EU negotiators called obstruction by Buenos Aires.

]]> Thu, 09 FEB 2012 09:07:53 AEST Washington (AFP) Feb 8, 2012 - US authorities Wednesday unveiled charges against five people and five companies in an espionage scheme aimed at stealing trade secrets for Chinese-controlled firms from US chemical giant DuPont.

A grand jury indictment unsealed in San Francisco contains charges in a "long-running effort to obtain US trade secrets for the benefit of companies controlled by the government of the People's Republic of China," the Justice Department said.

In the latest in a series of industrial espionage cases, the indictment said the Beijing government had "identified as a priority" the development of chloride-route titanium dioxide, or TiO2, which is a valuable white pigment used in paint, plastics and paper.

"The theft of America's trade secrets for the benefit of China and other nations poses a substantial and continuing threat to our economic and national security, and we are committed to holding accountable anyone who robs American businesses of their hard-earned research," said Lisa Monaco, assistant attorney general for national security.

Among those charged was the Pangang Group Company Ltd., a state-owned enterprise in Sichuan Province, and three subsidiaries, and USA Performance Technology Inc., a California-based engineering consulting company.

According to the indictment, USA Performance Technology entered into a contract worth more than $20 million to convey TiO2 trade secret technology to Pangang Group companies.

The scheme conducted over several years helped develop large-scale TiO2 production capability in China, including a planned 100,000-ton capacity factory at Chongqing, the Justice Department said.

The individuals charged included Singapore-born Walter Lian-Heen Liew, also known as "Liu Yuanxuan," 54, a naturalized US citizen and co-owner of USAPTI, along with his wife and Chinese-born co-owner Christina Hong Qiao Liew, known as "Qiao Hong," 49.

Also charged was Chinese national and Pangang executive Hou Shengdong, 42; former DuPont engineer Robert Maegerle, 76; and another former DuPont employee, Tze Chao, 77.

Walter Liew was arrested in August and has been detained as a flight risk, officials said. His wife was arrested at the same time and was released under travel restrictions and electronic monitoring.

Maegerle was arrested Wednesday in Delaware and Chao was served with a summons to appear in court March 1. A warrant has been issued for Hou's arrest, officials said.

According to the indictment, China was a major importer of the chemical and DuPont was unwilling to sell its technology to Chinese firms.

DuPont invented the chemical in the late 1940s and since then has invested heavily in research and development to improve that production process. The global titanium dioxide market has been valued at roughly $12 billion, and DuPont has the largest share of that market, officials said.

The chloride-route process is more efficient and cleaner than the sulfate-route process prevalent in China.

The FBI opened an investigation after DuPont reported that its TiO2 trade secrets had been misappropriated.

In a separate industrial espionage case, a Chinese scientist was sentenced in December to more than seven years in prison for stealing secrets on organic insecticides from Dow AgroSciences, where he worked from 2003-2008.

]]> Thu, 09 FEB 2012 09:07:53 AEST New Delhi (AFP) Feb 8, 2012 - India's flagship information technology and business services sector forecast on Wednesday that export growth would slow in the next financial year amid global "economic uncertainties."

Exports from the sector are expected to increase by up to 14 percent to $78 billion in the fiscal year that begins April 1, said the National Association of Software and Services Companies, or Nasscom.

That is down from an estimated 16 percent growth in the current year, the industry body said.

The slower growth outlook reflects "economic uncertainties" in the industry's key US and European markets that account for around 80 percent of the sector's revenue, Nasscom said.

"There is a tremendous amount of uncertainty and delayed decision-making," Nasscom chairman Rajendra Pawar told reporters, adding the body would review its forecasts in October.

Nasscom president Som Mittal said the sector was expanding into new markets such as Latin America and the Middle East as it seeks to propel revenue growth.

Domestic sales growth was expected to outpace export growth for the first time next year, Nasscom said.

The IT and business process outsourcing (BPO) sector employs 2.8 million workers, making it one of India's largest employers. Some 230,000 jobs had been added in the 2011/12 financial year, Nasscom said.

India held around 58 percent of the global outsourcing market in 2011, up from 55 percent in 2010, Nasscom said.

US and other foreign firms have been drawn to India by its vast English-speaking workforce and lower labour costs.

The outsourcing sector, which has been a crucial driver in India's transformation into a major emerging market economy, accounts for around five percent of GDP.

]]> Thu, 09 FEB 2012 09:07:53 AEST Paris (AFP) Feb 8, 2012 - Global art auction sales surged to a record $11.5 billion (8.7 billion euros) last year despite the weak world economy, with China cementing its spot as the top market, research showed Wednesday.

A report by Artprice, the France-based world leader in art market data, said auction revenues had risen 21 percent last year and for the first time exceeded the $10 billion mark.

"This exceptional growth did not fade through the year," Thierry Ehrmann, Artprice founder and chairman, told AFP, adding that in a time of financial crisis "art has become a truly safe investment.

"Once a work of art is worth 15,000 euros or more, the buyer is not taking any risk of loss. At the worst, it will maintain its value," Ehrmann said.

"And once you're at 150,000 euros, the buyer can bank on earning 12 to 15 percent on his investment in years to come. In the 1950s there were 500,000 collectors. Now there are 300 million art consumers."

China, which took over the first place in global auction sales in 2010, held on to the top spot with $4.79 billion in sales, or 41.43 percent of the market.

The United States was in second place with $2.72 billion in sales, or 23.57 percent of the market, followed by Britain with $2.24 billion, or 19.36 percent of the market.

As well as China's 38 percent growth in auction revenue last year, Singapore posted growth of 22 percent and Indonesia of 39 percent, the report said.

The year's best result was also generated by an Asian artist, China's Qi Baishi, whose 1946 painting of an eagle perched on the branch of a pine tree sold at auction in Beijing last May for 425.5 million yuan ($67.6 million).

]]> Thu, 09 FEB 2012 09:07:53 AEST Beijing (AFP) Feb 8, 2012 - Canadian Prime Minister Stephen Harper will meet Chinese Premier Wen Jiabao on Wednesday, kicking off a four-day trip aimed at prying open more of the Chinese market for Canadian resources.

During the visit Harper will also hold talks with President Hu Jintao and other top leaders that will likely focus on trade as oil and gas-rich Canada seeks to boost ties with the energy-hungry Asian giant.

Canada -- heavily reliant on the United States to buy its exports -- is keen to sell more commodities to China after Washington last month rejected a proposed pipeline to carry oil from the Alberta tar sands to the US Gulf Coast.

The Keystone XL pipeline was viewed as crucial to Canada's economic prosperity, by opening up new avenues to sell products from its landlocked oil sands to the United States and abroad.

"If you look at the world economy and where it's growing, the Asia-Pacific region is where the activity is," Harper's spokesman, Andrew MacDougall, told AFP ahead of the visit.

"Canada needs to be more engaged in the Asia-Pacific region," he said, adding that the trip's aim of diversifying the nation's markets was largely "in response to decisions taken in the United States".

China is already Canada's second-largest trading partner. Bilateral trade between the two countries soared 60 percent in the past two years to almost $50 billion in 2011, the China Daily said Wednesday.

"There is no conflict of fundamental interests between China and Canada," the official English language newspaper said in an editorial.

"The growth in Sino-Canadian ties has brought concrete benefits to both nations and at the same time promoted peace, stability and prosperity in the Asia Pacific region and the whole world."

In recent years, Canada has opened new trade offices and sent ministers on 46 trips to China, and sent back two Chinese fugitives, earning it goodwill in Beijing.

For its part, China has been investing heavily in Canadian reserves of shale gas -- hard-to-reach gas trapped in sedimentary rock -- as it seeks to reduce its reliance on dirty coal and oil imports.

During this trip, Harper is expected to sign a few small deals such as a foreign investment protection and promotion agreement with China, and secure a loan of giant pandas to Canadian zoos.

After Beijing, he is scheduled to visit the southern city of Guangzhou and the southwestern mega-city of Chongqing.

The Canadian leader has been joined by his wife Laureen, several ministers and members of parliament and 40 business executives.

Harper was a vocal critic of China's human rights abuses during his first term in office and MacDougall insisted he was still concerned about the issue, but analysts expect it will be overshadowed by trade during the visit.

]]> Thu, 09 FEB 2012 09:07:53 AEST Washington (AFP) Feb 7, 2012 - A barrage of complaints over Beijing's allegedly discriminatory trade policies awaits Chinese Vice President Xi Jinping, the country's leader-in-waiting, when he visits Washington next week.

Trade tensions between the world's two largest economies are on the rise as President Barack Obama seeks to spark economic growth and create jobs -- and bids for re-election -- by attacking the deep US trade deficit with China.

Analysts say Obama's pledge last month to launch a trade enforcement unit likely to focus on China and a new sweeping complaint against Beijing by the US auto parts industry are bringing the two sides closer to a trade war.

Xi arrives on Tuesday for a get-to-know-you visit with Obama, with a full range of political issues on the agenda.

His trip comes three weeks after Obama singled out China in his annual State of the Union address as a major problem for the US economy and tied it to the country's high jobless rate.

"I will not stand by when our competitors don't play by the rules," Obama said.

"It's not right when another country lets our movies, music, and software be pirated. It's not fair when foreign manufacturers have a leg up on ours only because they're heavily subsidized."

"Our workers are the most productive on Earth, and if the playing field is level, I promise you -- America will always win."

The move to set up what will likely be a high-level, China-focused trade task force was just Obama's latest effort to boost US manufacturers against the Chinese export juggernaut.

Tit-for-tat trade actions have been building since the Obama administration levied countervailing duties (CVD) against allegedly subsidized Chinese tires in 2009.

"The Chinese were pretty upset about that," said Dan Ikenson of the Cato Institute. But they appealed the case to the World Trade Organization and lost.

Now the US has levied counter-veiling and anti-dumping duties against some two dozen Chinese products, from tires to steel bars and frozen shrimp, and has lodged WTO complaints over Chinese solar panels, wind turbines and other products.

China has responded with its own punitive duties on imported US chicken and luxury cars and WTO counter-complaints.

Washington has repeatedly pressed Beijing over its undervalued yuan, a policy which critics say favors Chinese exporters.

But China has only given in slightly, letting the currency appreciate at an extremely slow pace that has not satisfied Washington.

The trade gap remains huge: the US ran a $272 billion deficit with China in the 11 months through November 2011, eight percent higher than a year earlier. Chinese imports account for 40 percent of the total US deficit.

Analysts say they expect the trade actions will only pick up.

"The Obama administration will not stand by when our competitors don't play by the rules," an administration official told AFP when asked if the situation was escalating, repeating the president's State of the Union warning.

"We will continue to identify and address unfair trade practices to ensure that China and every other country play by the rules."

The US presidential election campaign has only heightened the rhetoric -- Republicans seeking their party's nomination to square off with Obama in November are all bashing China and the White House over the trade gap.

China economy expert Huang Yukon of the Carnegie Endowment for International Peace said the words are not harmless, especially as Xi will have to demonstrate his own toughness to the Chinese people should he be named president.

"The rhetoric has a life of its own. That's why the fears of a trade war are real," he said.

But he added, "I don't think it will go away as long as there is high unemployment in the United States, and as long as the US trade deficit remains so high."

But the US tactics against China have run into snags. US fair trade enforcers have been able to take advantage of China's official status as a "non-market economy".

Ikenson says that label gives officials much more leeway in making a case that China is subsidizing or dumping a product, or both.

"It's very subjective," he said. "It's much easier to find dumping in the Chinese case because of the methodology employed."

But in December, a US federal court of appeals ruled that if China is not a market economy, US law does not allow it to label government payments as "subsidies", and so CVDs cannot be levied.

Then on Monday in a WTO case the US was forced to give up another methodology, known as zeroing, that also made it easier to rule that a country like China was dumping underpriced products into the US market.

Both were significant setbacks to the US campaign on Chinese trade. Ikenson said the appeals court ruling could reverse all US CVD cases against China and Vietnam.

The Commerce Department and the US Trade Representative have appealed to Congress to urgently rewrite US laws to allow the CVD claims against China.

]]> Thu, 09 FEB 2012 09:07:53 AEST Tokyo (AFP) Feb 8, 2012 - Japan's current account surplus tumbled 43.9 percent to a 15-year low in 2011 as the nation logged a trade deficit due to lower exports and higher energy costs, government data showed Wednesday.

The surplus in the current account, the broadest measure of trade with the rest of the world, stood at 9.63 trillion yen ($125 billion) in 2011, the lowest level since 1996, the finance ministry said.

The figure was down 43.9 percent from 2010, the sharpest year-on-year decline since 1985.

The surplus in returns on overseas investment and other income expanded "but the balance of goods and services trade slipped into the red, reducing the surplus in the current account," the ministry said in a statement.

The traditionally export-led economy has shifted to more overseas production as shown by strong figures for earnings from overseas assets held by Japan. Those earnings rose by nearly 20 percent to 14.03 trillion yen.

Analysts say any systemic shift in Japan's current account numbers could threaten the country's ability to finance its large government budget deficits.

Earlier data from the ministry showed Japan suffered its first annual trade deficit in more than 30 years in 2011 after the March quake-tsunami and strong yen hit exports while high fuel costs pushed up import bills.

The current account surplus for December alone dropped 74.7 percent to 303.5 billion yen, decreasing year-on-year for the 10th straight month since the March earthquake and tsunami disasters.

The surplus was smaller than an average of 337.5 billion yen expected by economists surveyed by the Nikkei business daily.

The March disaster disrupted manufacturing supply chains across Japan, hampering exports.

It also knocked out cooling systems at a major nuclear power plant on the nation's east coast, sparking the world's worst atomic disaster in 25 years and sending confidence in the technology plummeting.

Japan is resource-poor and its fossil fuel imports have soared in the wake of the Fukushima nuclear crisis, with atomic power stations being taken offline and thermal fuel plants used to make up the difference.

In addition, the eurozone debt crisis has slowed the global economy and sent traders scurrying to the safety of the yen, driving up its value and reducing Japanese exporters' incomes.

The current account measures trade in goods, services, tourism and investment.

-- Dow Jones Newswires contributed to this article --

]]> Thu, 09 FEB 2012 09:07:53 AEST Washington (AFP) Feb 6, 2012 - An escalation of Europe's debt crisis could slash China's economic growth in half this year, the International Monetary Fund said Monday, urging Beijing to prepare stimulus measures in response.

The IMF, in an economic outlook report on the world's second-largest economy, highlighted China's vulnerability to global demand.

"The global economy is at a precarious stage and downside risks have risen sharply," the IMF said, citing the possible deep crunch in the financial sector in Europe that would be felt around the globe.

"Should such a tail risk of financial volatility emanating from Europe be realized, it would drag China's growth lower."

The IMF outlined the negative impact if the eurozone crisis tipped Europe into a deep recession, dragging China's growth lower mainly due to shocks through trade.

In that "downside scenario" China's growth would fall by around 4.0 percentage points this year from the 8.2 percent rate the IMF projected in January.

"The risks to China from Europe are, therefore, both large and tangible."

In that case, "China should respond with a significant fiscal package."

China's exposure to financial spillovers is limited, it said, noting foreign assets, including sovereign debt, represent only 2.0 percent of Chinese bank assets.

However, the export-dependent economy is highly exposed through trade linkages. Nearly half of China's exports go to Europe and the United States.

Lower global demand would further reduce investment and employment and may trigger a decline in China's property market.

The IMF recalled that China's vulnerability was revealed in the 2008-2009 global financial crisis, when global growth plunged.

China launched a huge credit and fiscal stimulus in response, limiting the sharp impact on the domestic economy -- and yet growth still sank by five percentage points.

"However, a track record of fiscal discipline has given China ample room to respond to such an external shock," the IMF said.

If the euro area falters, the IMF recommended Beijing launch a substantial stimulus program, equivalent to roughly 3.0 percent of gross domestic product spread out over 2012-2013.

That would limit the decline in growth to around 1.0 percent, cushioning the negative fallout on employment and people's livelihoods, the IMF said.

The stimulus measures could include reductions in consumption taxes, advancing plans for social housing and scaling up investments in the social safety net, among others.

"Unlike in 2008, the stimulus package... should pass through the budget and not be reliant upon a public infrastructure," the IMF said, referring to the way the spending boost was previously dealt through the banking system, state enterprises and local government financing vehicles.

"The weak external outlook underscores the importance of accelerating the transformation of China's economy to reduce its vulnerability to the vagaries of global demand," it added.

]]> Thu, 09 FEB 2012 09:07:53 AEST Beijing (AFP) Feb 7, 2012 - A top Chinese official has warned of a "trust deficit" between Beijing and Washington and expressed hopes that a key visit to the United States next week by China's leader-in-waiting will strengthen ties.

Vice Foreign Minister Cui Tiankai made the remarks in a speech published on the ministry's website on Tuesday, as Beijing and Washington lock horns over China's decision to veto a UN resolution on the bloody violence in Syria.

"There is indeed a trust deficit between China and the United States," Cui said in a speech on Monday but only published on the foreign ministry website Tuesday.

"Each time the Sino-US relationship has problems, there are voices that fundamentally doubt the relationship.

"Nurturing and deepening mutual trust remains a major issue that both sides must give full attention to and seriously address."

China's Vice President Xi Jinping will travel to the United States on Monday on a visit seen as part of efforts by the administration of US President Barack Obama to court the leader-in-waiting, about whom little is known in Washington.

His trip comes after US Secretary of State Hillary Clinton strongly criticised China's veto of a UN Security Council resolution condemning Syria for its violent crackdown on protests, calling the move a "travesty".

There are also concerns in Washington about Beijing's rising military spending, while many Chinese policymakers are convinced that Washington is trying to contain the Asian power.

Cui said Xi, who is likely to succeed President Hu Jintao in a major leadership transition that begins this year, could help improve trust between the world's two biggest economies.

"We hope both sides can seize the opportunity of this visit to strengthen communication, enhance mutual trust, expand cooperation, deepen friendship, and push forward the Sino-US partnership," he said in a speech delivered Monday in Shanghai.

Foreign ministry spokesman Liu Weimin, however, played down Cui's comments on Tuesday, telling reporters that differences between China and the United States were "quite normal".

Xi will meet with President Barack Obama on February 14 and is expected to deliver a speech in Washington before heading to Iowa.

]]> Thu, 09 FEB 2012 09:07:53 AEST Subscribe to our daily selection of space, military, environment and energy newsletters responseText http://visitor.constantcontact.com/manage/optin/ea?v=0016gbbKsaiGSpQFojVO8ZoHw%3D%3D