Egypt is trying to persuade Arab states and banks to buy its military debts to the United States and other Western countries so it can repay them on better terms, an Egyptian official said. “We want the Arabs to buy the debt and reschedule it at a more reasonable interest rate of up to seven pct,” the official, who asked not to be named, told Reuters. Egypt owes the U.S. 4.

Prime Minister Yasuhiro Nakasone’s unpopular sales tax plan has been defeated and although fellow politicians and political analysts agree he has suffered a grave loss of face only a few are willing to write him off. Michio Watanabe, a Nakasone faction member and deputy secretary general of the ruling Liberal Democratic Party, LDP, is one of those who believes he will survive. “He’s tough, he won’t step down,” but “will hang on to the death” at least until his term ends on October 30, Watanabe told Reuters.

The Soviet government said economic results achieved in the first three months of the year were unsatisfactory, the official news agency Tass said. Soviet industrial production from January to March grew by 2.5 pct compared with the same period last year, but fell short of its target by 0.8 pct, official statistics showed. “The Council of Ministers (government) emphasised that the results did not meet the Communist Party’s exacting demands for the radical reconstruction of the economy,” Tass said.

Thailand’s gross domestic product will expand five pct this calendar year, up from 3.8 pct in 1986, despite a projected slight decline in agricultural output due to drought, the Bank of Thailand said. Central bank spokesman Siri Karncharoendi told reporters the Thai economy clearly recovered in the first quarter from the lingering effects of the 1984-85 recession. He said the industrial sector is expected to expand 5.5 pct this year, up from five pct in 1986.

Growth in oil consumption in the Western industrialized countries is likely to slow to around one pct this year compared with 2.3 pct in 1986, the International Energy Agency (IEA) said. Oil use in the 24 countries of the OECD increased by around one pct in first quarter 1987 to 35.9 mln barrels per day, the IEA said in its Monthly Oil Market Report. Growth in OECD countries is expected to come primarily from transport fuels, as in 1986.

Iraqi warplanes attacked and hit a large “naval target” – Baghdad’s term for a tanker or merchant vessel – in the Gulf today, an Iraqi military spokesman said. He said the raid took place off the Iranian coast at 0600 gmt and all aircraft returned safely to base. Lloyds Shipping Intelligence earlier today said the Greek bulk carrier Pamit, 84,137 tonnes dw, was attacked and hit in the engine room this morning in the northern Gulf.

Japan has no plans to liberalise its farm markets, but will try to narrow the gap between the price of farm products at home and overseas, Agriculture Minister Mutsuki Kato said. He told reporters the move is aimed at deflecting criticism of Japanese protectionism on its agricultural goods. But Kato said he has no plans to start bilateral trade talks with the United States over rice, Japan’s staple food. Washington has called Tokyo’s rice policy an extreme example of protectionism and has demanded access for U.

Treasury Secretary James Baker said the Group of Seven countries, in seeking to foster stability in exchange markets, believe a further decline in the value of the dollar would be counterproductive. In answer to questions by a business group, Baker said that for one thing further reductions could make it economically difficult for the surplus countries to grow, thereby making it difficult for them to purchase overseas goods. In addition, Baker said he was opposed to the U.

OPEC has regained its former role as price-setter in the oil market following last year’s price war, acting OPEC Secretary General Fadhil al-Chalabi said. But he said he expects no short-term rise in demand for OPEC oil, adding that market stability will mean a continued sacrifice for the 13 OPEC member countries. Al-Chalabi, speaking at a university here yesterday, said the December 1986 conference at which OPEC set an 18 dlr per barrel reference price gave the market a signal that the producers’ group was serious.

The U.S. warned its major trade partners that its trade deficit must fall by September or a protectionist trade bill from Congress would be highly likely. Meanwhile, European Community (EC) external trade chief Willy de Clercq said that if Japan’s trade surplus, which hit almost 90 billion dlrs last year, continued so high, there would be stormy weather ahead. U.S. Trade representative Clayton Yeutter told trade leaders from Japan, the EC and Canada that there was at least a 50-50 chance that a protectionist bill reaching the House of Representatives this week would pass the Senate in September.