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(generated from captions) was coming up were ahead of

other people, that he was no

longer sort of a deadbeat Prime Minister, he was somebody to

somewhat unfortunate statement the fore, and he made that

about saving the world and

obviously that's come back a

bit. But this summit is to

some extent domestically could

be politically his last

chance. We've already seen some evidence of economic

nationalism around the world in

response to this crisis, are

members of the G20 likely to

genuinely commit to not embrace

protectionism as a response? They're likely to

commit, but the genuineness is

the proper. I'm sure they will

come up somewhere in the

communique there'll be a thing saying protectionism is a terrible answer to all these

things. They did that last

time they basically met in the

Autumn, but again what happened

then is straight afterwards

they all went back and raised

tariffs. They began to bail

out their own banks on

condition they only lent

domestically. Economic

nationalism is the great evil lurking in the world at the moment and that is something

which they will still, I think,

find it hard to really deal with on the hard end. Because

in the end, it does involve

things like saying, "Here are

your banks, I'm not going to

penalise them for having

operations overseas qus and

that's very difficult at this

precise moments. But

politicians are facing very

angry electorates and the

temptation to give in to easy

pressures on it is very

high. So it's easier perhaps to

act in violation of the G20

communique than take on

electorates at home? Very much

so, and the way in which they

violate it - you can usually

find ways to violate which they

can then afterwards claim they

haven't done anything wrong.

One easy way is the WTO rules. Most countries at the moment

their tariffs are below the

levels that the WTO allows them

to have. So if you merely

raise them a bit but keep

within the WTO rules you can

claim, "I'm not doing anything

wrong, I'm within the WTO rules" but you will have

raised tariffs and done

something against free trade.

It's that fudge people are

looking for, or when they do

rules about telling banks to

lend at home they say it's a

short-term effect and we need

it and besides the loans at

home are safer anyway. It's a matter of capital adequacy.

There are all sorts of ways in

which you can hide these things

away, or you can claim American

clauses are needed for

particular reasons. It's easy

to go and it gains you often

immediate political dividends

whether or not the G20 has been at home. How do we gauge

a success? Most obviously if

they emerge from a room smiling

and altogether and all in one

piece, I suppose many people

would take that as a sort of

victory. I think the fact that

something will probably come

out of this will be useful.

There is a danger that they

come together and nothing happens and that there is some

very bitter row. I tend to

think that's unlikely, because

that is such a Cass Chris Mick

event for virtually everybody

-- cataclysmic event for

everybody. It's a stretch at

the moment, except for stuff

perhaps about the IMF. It

doesn't sound particularly optimistic. John Micklethwait,

thanks for joining us. Put a

real dampner on things for us

there. Sorry. Thank you very

much for joining us.

More than 200 people who'd

hoped to find a better life in

Europe are thought to have

perished at sea off the coast

of Libya. An overcrowded boat

capsized on Sunday in a violent

storm. A second boat also

packed with migrants has been

rescued in the same area.

Brendan Trembath reports. It's

standing room only, but these

migrants are relatively fortunate. They were rescued

from stormy waters about 50

kilometres off the Libyan

Coast. A second overcrowded

boat sank in the same area.

Hundreds of people are feared

dead. About 20 bodies have

been found so far. It was top

heavy and with the heavy winds

that blew at the time it's

quite possible that the boat

simply turned over and those

boats have no life jackets, no

liferafts. These migrants are

believed to be from Africa.

Each year, tens of thousands of

people try to cross the

Mediterranean in unseaworthy

craft. People-smugglers charge

large sums for the package.

It's a risky business. Our

police people save every day

people that are in need of

rescue, that are at risk of

possible to save their life. So we do what is

lives. The Italian Foreign

Minister says Italy and Libya

will try to avert such

accidents in future. The

nations plan to introduce joint

patrols from the meddle of next

month. More than 2,000 people

are tonight stranded by floods

on the NSW Mid North Coast.

Days of heavy rains have cut

off residents in towns near

Bellingen and Coffs Harbour.

The State Emergency Service has

rescued more than 100 people

and the area has been declared a natural disaster zone. Despite the flood being

described as a once in 100-year

event it's the second time that

some towns have been flooded in

six weeks. People were only

just discovering from the

earlier event and homes have

been inundated again. The

Weather Bureau says the worst

of the heavy rains has passed,

but it's warning that localised

flooding is still a threat.

Now to the rest of the weather:

That's all from us. Lateline

Business coming up in just a

moment. If you'd like to look

back at tonight's interviews

with Wayne Swan or John

Micklethwait or review

Lateline's stories or

transcripts you can visit our

website. And now Lateline

Business with Ali Moore.

Tonight - second time round, Oz

Minerals confident its new

rescue plan will win approval,

but questions remain about

Chinese investment. Consumer

investment in production, if

that consumer gets into a

position where they are able to

influence the global

crisis. Caught in the fallout -

Asia's developing nations

unable to escape the global

financial crisis and they want

a bigger say at the IMF. There

has to be some internal

government changes within the

IMF, in particular giving

developing Asia a voice

proportionate with its growing

world in world trade, growing

role in world economy. And,

staying clear of dirty money -

tough new penalties for not

keeping an eye on the

books. It's a complex area

where often the business

community knows best how to

track or how to stop a

particular practice.

To the markets and ignoring

overnight gains on Wall Street,

Australian stocks closed little

changed, despite a rally in

mining shares, the All Ords

lost 5 points. The ASX200 shed

a similar amount. But it was a

different story in Japan where

the Nikkei jumped 3%. Hong

Kong's Hang Seng closed just

under 0.5% down and in London,

the FTSE is also lower in early

trade. The market has not

warmed to the second rescue

plan for debt laden miner Oz

Minerals with shares down more

than 3%. China's Minmetals has

agreed to buy Oz Minerals's assets excludeing the Prominent

Hill mine in South Australia's

prohibited Woomera area. Oz

Minerals says the new deal

let's it hold onto a prized

asset and build a war chest.

Neal Woolrich reports. In

mining as in life, if you don't

succeed, try again. Last week

the Federal Treasurer knocked

back the Chinese company

Minmetals $2.5 billion bid for

Oz Minerals on national

security ground because the key

asset the Prominent Hill gold

and copper mine lies within the

Woomera restricted zone.

Minmetals has agreed to pay

$1.75 billion. Oz Minerals's

chief executive, Andrew

Michelmore, says the deal would

allow the company to retire all

of its debt and keep a cash

balance of $600 million. It's

certainly an excellent set of

sates with the cash and the

Prominent Hill and the market

would value it. We've seen

that with other companies.

It's a very good gold, copper

operation. Probably on paper

it isn't quite as good as the

original deal, but shareholders

will retain more upside and

exposure to the best asset the

company has. The market also

gave the deal a cool reception,

with Oz Minerals's share price

falling 3.5% to 53 cents, a far

cry from Minmetals's original

offer of 82 cents per share. I

think there was panic selling

straight away on the open and

then you've seen the price

basically recover to where it

was before. There's still risk

in the price on the back of the

original decision, I think. Oz

Minerals was born from the

merger of Oxiana and Zinifex in

2008. Andrew Michelmore today

defended that union, saying the

two companies alone would have

had great difficulty surviving

the plunge in commodity prices

late last year, and it would

have been much harder for

Oxiana alone to develop

Prominent Hill. The whole

reason for putting the two

companies together is exactly

the same. It gave strength to

the balance sheet, one with the

growth project from Oxiana and

the other with the cash that

was sitting on Zinifex's

balance sheet. The former chief

executive of Zinifex Greig

Gailey steered that company

when it rose from the ashes of

Pasminco. He refused to be

drawn on the reasons for Oz

Minerals's current

predicament. It's two years

since I left Zinifex. It had

money in the bank and $1

billion coming in from the

smelting sale, it was in good

financial health. I can't

comment on where it is today,

that's an issue for management

of Oz Minerals. Greig Gailey

says he has no doubt to doubt

Wayne Swan's justification for

knocking back the initial Oz

Minerals's takeover bid, but he

says Chinese investment in the

industry is critical. I don't

see any difference to the

Americans, or the Japanese.

Why should we differentiate

between one country or another?

There are issues about consumer

investment in production if

that consumer gets into a

position where they are able to

influence the global

price. MorningStar analyst

Matthew Hodge says it would be

a shock if the Foreign Investment Review Board knocked

back Minmetals's revised bid

but he's not convinced about market speculation that BHP

Billiton might eventually try

to buy Prominent Hill. I think

it's borderline for them. I

think they'd buy it if the price was right. It's

certainly not an asset that

they need. I don't know, I

don't really know how much

synergies they could get out of

that. For now, that question is

purely hypothetical as there

are still several other hurdles

for this deal to clear,

including approval from Oz

Minerals shareholders and the

Chinese authorities. For a

look at the rest of the day's

action on the markets I spoke

to David Halliday from

Macquarie Private Wealth. It

doesn't get much flatter than

this? Uninspiring in a word. I

suppose you could say the

volumes were light. For every

inincrease there was a

decrease. BHP up by about 2%,

banks were strong, up by about

1% across the board. Insurance

stocks weaker, by about 1.5%.

That was pretty much the case

across the board. For any gain

there was a loss, and a net

result of 2%. What was it all

for? Particularly on light

volumes, probably a sign of

things to come. Our market today struggled to find real

direction. We were in positive

and negative territory through

the most of the day at some

points to the tune of 20 points

positive and negative. Little

leads for the market to pick up

on at the moment. You say it's

a sign of things to come, given

the recent run of gains do you

think we are going to bump

along for a while? It's going

to be hard to find catalysts to

find the market back to the low

point. Any of the news is not

enough to drive us to new highs

in the short-term. We'll be watching the US reporting

season which kicks off in about

a week's time. The economic

news probably needs to settle

just for a little while. We

need to take a breath and have

a big run-up during the course

of March. That was on the back

of improving economic news.

We'll need to assess that news

now and work out whether the

market can go higher or lower

from here. It's going to be a

case of watching the data and

if the market improves the

market will probably kick

higher. Fortescue was one

highlight today after getting

the nod from the Foreign Investment Review Board. It was

good news. The stock finished

2 cents higher, it was a lot

higher throughout the course of

trade. I think it probably

reflects in many cases these

assets weren't as strategic as

some of the other assets under

review by the Foreign

Investment Review Board,

clearly the case of Oz Minerals

has been highlighted over the

past couple of days. It's good

news for Fortescue, for foreign

investment in Australia and

good news for the iron ore

sector. Certainly iron ore and

coal form a big part of the

export base in Australia. The

fact that this investment comes is going to expand the

operation to Fortescue and add

to the export revenue coffers

of the Government. Good news

all round. The banks were also

stronger, to what extent was

that driven by interest rate

speculation following those

pretty dreadful retail sales

numbers? Probably most of it.

It does appear that the Reserve

Bank when they meet next Tuesday will be left with

almost no choice but to cut

rates again. We did expect one

last month but the Reserve Bank

chose to hold fire. It is

quite clear now that the

Reserve Bank will have to move

by at least 25 if not 50 basis

points to the downside on

official rates. That will be

welcome relief for

mortgageholders and will

increase lending. That's why

the bank's had a good day

today. Those retail sales

numbers were horrible for the

month. If you include the

December and January figures

we're still up in terms of

retail sales on where we were

last November. Clearly the effects of some of that

Government stimulus is starting

to show up in the real economy

and specifically in the retail

sector. Probably still good

news for the retailers given

there's more of the interest

rate cut effect and more of the

stimulus to hit the markets. To

the other major movers on our

market today:

There's been a barrage of forecasts about the global

economy in the lead-up to the

G20 in London and now the Asian

Development Bank has added its

voice to the debate with a

gloomy assessment of the extent

to which developing economies

are being affected by the

financial crisis. With China

in the box seat amid calls for

Beijing to have a greater say

in the IMF, the ADB says it's

not just China but the

developing world which needs

better representation. The

ADB's senior economist is Dr

Dong-Yhunn Park. He's

currently visiting Sydney from

the bank's base in The

Philippines and he joined me in

the studio a short time ago.

Dr Park welcome to Lateline

Business. Thank you for

inviting me here. Let's start

with the big picture. The

World Bank said just yesterday

that growth in the developing

world will slow to 2% this

year, but if you take out China

and India it'll actually be

zero. Does that tally with

your assessment? Yes, that

tallies with our assessment,

even though our focus is on developing Asia rather than developing countries as a

whole. I think developing Asia

as a subgroup of developing

countries will do somewhat

better than developing

countries as a whole. Why is

that? I think it's largely as

you indicated due to the

dynamism of China and India. Some of it will be there despite the global financial

crisis and a lot of that die

Nammism is driven by domestic

demand. You have to remember,

these are large domestic

economies. Again to quote the

World Bank, it says growth will

be 6.5% in China this year.

You're more optimistic, 7% and

8% next year. That's far from

a disaster, isn't it? Yes,

that's far from a disaster, but

what you have to keep in mind

is this, a 1% reduction, or 1%

fall in the GDP growth over

China or India is something

that is very different from a

1% reduction in the GDP growth

in the US or Australia. In

other words, the welfare

implications are much more

severe. I think the best way

to think about this is in the

US or Australia it's the

difference between having one

cars or two cars, but in Asia,

in developing Asia, and despite

very rapid growth, I think you

have to keep in mind that India

and China and all these

fast-growing economies are

still relatively poor

countries. In those countries

it can be the difference

between having two meals a day

or three meals a day. So

they're vastly different

implications of a one

percentage reduction in GDP

growth for poor developing

countries and the rich

developed countries. How

important is it that China gets

a greater role in the IMF? A

greater role in return for more

money is something that

certainly the Australian Prime

Minister is advocating. How

important is it that that

happens? I think that's very

important, but let's not just

focus on China. I think here

the issue is developing Asia as

a whole and in particular East

Asia and South-East Asia and

also to some extent India and

other emerging economies in

other parts of Asia. I think

rightly or wrongly, there has

been a perception in Asia that

the IMF has not done its job

very well during the Asian

crisis - again, this is a

matter of perception I'm not

saying that IMF did a poor

job... But the perception is

that developing Asia was left behind? The perception is that

IMF policy prescriptions may

have been too harsh for

developing Asia, that they were

inappropriate for developing

Asia. It's a perception that

may be correct or incorrect,

but there is this perception in

Asia which has led to erosion

of confidence in the IMF in

East Asia, in the countries

that were hit by the Asian

crisis, in particular. So in

order for IMF to restore its

credibility among Asian

countries, there has to be some internal governance changes

within the IMF. In particular,

giving developing Asia a voice,

proportionate with its growing

role in world trade, growing

role in world economy. So it's

not really just the IMF? Is it,

in fact, part of the challenge

to integrate all the developing

economies, whether it's China,

India Brazil, into the global

financial institutions? Yes,

not just global financial

institutions, also global trade

institutions such as WTO and in

general, global economic institution and the international economic order,

because these institutions and

these institutional

arrangements that are in place,

for example, the share of votes

in the IMF just to give an

example is based on a world

economic structure of decades

ago rather than that of today.

In other words it's an

institutional arrangement based

on a world in which the

developed countries, their

share of world trade was much

larger, their share of the

world economy was much bigger

than it is today. It was also

drawn up at a time that has

become dominated by America.

How much happiness is there in

Asia about the American

dominance about those

institutions and indeed world

trade? I don't think it's so

many resentment at American

dominance or the domination of

strielised countries. I think

the resentment has to do with

underrepresentations and again,

these are representations that

are based on an old world

economic structure in which the

share of developed countries was much smaller than it is

today. You say " not

resentment" but I wonder

against that backdrop about

China's moves to, I guess,

reduce US influence. First of

all, they call for a

replacement of the US dollar as

the global Reserve currency and

now I understand they've

allowed not just South Korea,

Indonesia and Asia, but also

Argentina to trade with them in

Yuan but not dollar. How

significant is that? I think

there is a perhaps - resentment

is too strong a word, but there

are concerns in China and

developing Asia that their

policies their unsound

macro-economic policies are

subject to the IMF and other

institutions. There's nothing

that constrains the unsound

economic policies of developed

countries like the US. Please remember, this global financial

crisis is rooted in the US

subprime crisis which in turn,

is rooted in unsound economic

policies. But that clearly has huge externalities for the

world as a whole, negative

spillovers effects for the

economy as a whole, but there's

nothing that promotes, no

institutional arrangement or

not even dialogue constructive dialogue among countries that

promotes good governance in

developed countries. So should

China succeed in this push?

Should the global Reserve krpsy

be replaced with a

broader-based alternative?

Should trade be Yuan based and

not American dollar based? I

don't think it's going to

happen overnight, because

creating becoming a Reserve

currency takes a very long

time. For example, the euro

once widely touted as an

alternative to the US for a

global Reserve currency, there

has some shift from the US

dollar to the euro as a form of

Reserve currency, but that

shift has been extremely slow, extremely gradual and I don't

think you can expect the

Chinese Yuan to become a

serious contender for an

alternative Reserve currency

any time soon. Dr Park, many

thanks for joining us. Many

thanks for inviting. It's

estimated $4.5 billion of

illegally acquired money is

laundered in Australia each

year. One of Australia's biggest security risks comes

from terrorists who wash their finances through minor transactions that slip under

the radar. But now the

Australian regulator is going

to come down hard on

institutions that don't comply

with anti-money laundering

rules , with fines as high as

$11 million. Desley Coleman

reports. It's said the love of

money is the root of all evil.

The drama 'Underbelly'

highlighted and methods used by

criminals in the '70s and '80s

to disguise their cash flow.

Modern criminals are still

finding ways to clean their

money through legitimate

systems. Today, international

experts gathered in Sydney to

discuss anti-money laundering

efforts. For 20 years, the Australian Transaction Reports

and Analysis Centre or Austrac

has been monitoring suspicion

transactions. We analyse data,

make it available to law

enforcement and national

security agencies to follow the

money trails and catch up with

criminality. About 17,000

entities are required to summit

anti-money laundering reports

to Austrac each year. That

spreads beyond the financial

sector to pokey machine

operators, bookies and

casinos. That is two fold, that

is to identify and know their

customers and to report

financial institutions to

Austrac. Last year, $1,500 businesses that should have did

not produce reports, and a

15-month grace period for

non-compliant entities has

expired and Austrac intends to enforce its civil penalties.

For companies, that could be

fines of up to $11 million and

$2.2 million for individuals. When you put it

into context in terms of the

data we're getting, we're

actually getting a lot more

data than most other countries,

and it's from that that our

analysts are able to find at the significant criminal activity and there've been over

20,000 investigations over the

last 20 years where our data

has been very significant. All

the major criminal activity

that's been identified by law enforcement and revenue

agencies, they've used our data

in identifying those

criminals. But there are

sceptics of the success of anti-money laundering

laws. They give us a sense of

security, but how much crime is

actually deterred and prevented

is an open question. Nobody

has even tried to estimate

that. Just how much money is laundered around the world is

also unclear. A report from

the International Monetary Fund

suggests that between 2 and 5 %

of global GDP is illegally

washed funds and it's also

estimated that $4.5 billion is

laundered in Australia each

year. There is a study that

came out maybe three or four years ago from the University

of Wollongong and I've been

quite critical of that study

because it relies in large part

on expert judgments and experts

are not very expert in this

area. So you ask one police

officer what share of drug

moneys are laundered as opposed

to just spend and one will say

10%, another will say 50% and

then in the study it'll be,

we'll average that and call it

30%. What you should really

say is I don't know. There are

some estimates, but they're not

based on... it's impossible. Laundered money

often ends up in the hands of

drug traffickers and terrorist

groups. From my perspective,

it's to protect the society.

Sometimes we don't pay

attention when we talk about

money laundering. We forget

that behind the money laundering, we have crime that

affects the life of people. Mr

Rodrigues is the head of

Brazil's Financial Action Taskforce and Financial

Intelligence Unit. He says

that anti-money laundering

regulation should be considered

a service to the community. And

they're trying to create a

better environment for us to

live in, for the business too,

to have a better environment to

make more money to make

everybody happy. The head of

the United Nations' Counterterroism Executive

Directorate Mike Smith says

strengthening of anti-money

laundering regulation needs to

be a concerted effort. It's a

very complex area. It's an

area where often the business

community knows best how to

track or how to stop a

particular practice and, therefore, collaboration

between the business sector and Government is extraordinarily important. With Austrac

receiving over 20 million

reports of transactions of

interest, tracking the

criminals is a very complex

task. Now a look at tomorrow's

business diary:

A look at what's making news

in the business sections of the


As I leave you the FTSE is

down 39 points or 1%. The Dow

futures are down 71 points or

just short of 1%. I'm Ali

Moore, goodnight. Closed Captions by CSI

This program is not subtitled

SQUAWKING MOBILE PHONE RINGS Hello? Where are you? I've been waiting. Why not? Say... OK. OK. All right. Call me later when you get a chance. # BACH: In Tears Of Grief (ST MATTHEW PASSION, in German) # Und rufen dir # Im Grabe zu

# Ruhe sanfte, sanfte ruh! # Wir setzen uns # Mit Tranen nieder # Und rufen dir... No, no, no, no, no, no, no! (SIGHS) Look... I know this is a difficult piece. That's the point. It'll impress the judges. But only if it's sung well. And that's not happening. You have to come off the line endings together. You sound as if you've got a collective stutter. Also, someone is singing a semitone flat. Leo,

I think it's you. I don't think it is. Well, I think it is you. It's your or Connor. Right, let's just try that again, please. From the letter C. # Wir setzen uns... # SINGING IN CHURCH CONTINUES CONDUCTOR: No! No, no, no, no! SINGING STOPS Let's just try that again. SINGING RESUMES # Ruhe sanfte, sanfte ruh! # Wir setzen uns...

OK, get him into recovery. He seemed fine when we started. He's passed out. His pulse is high, but it's coming down. Do you think he'll be able to continue? No. Um...

No, no, I suppose we'd better call it a night. How do you feel? I'm OK. I'm fine. Yeah. You hit your head when you fell. See you GP and get a check-up. Come on, I'll give you a lift home. No, no! I'm all right. Really. You're in no state to drive. I'll give you a lift back. Look, I don't need a lift! I will get a check-up and I'm all right! Thank you. I'll walk you back to the hall.

Stephen... No, I'll be fine, thanks. Caro! I thought we were rather good tonight, didn't you, Joyce? I don't know if Laurence would say so. Laurence?

Laurence is a perfectionist. It sounded very good. Did you like it? Yes. Did Connor Simpson say anything about feeling unwell before choir practice?