US Judge Rules Argentina's Debt Swap Proposal Illegal

Argentina's Economy Ministry's Legal and Technical Secretary Federico Thea arrives at the office of a court-appointed mediator for a meeting on Argentina's dispute with holdout investors.Reuters

Thomas Griesa, the US District judge who handles the lawsuit between Argentina and the holdout creditors, ruled the country's new proposal to restructure its debt "illegal."

However, Griesa did not hold Argentina in contempt.

The judge noted that the proposal announced by President Cristina Fernandez is in violation of his earlier orders and it would not help resolve the country's dispute with the holdout funds.

"I want to be very clear, this proposal is a violation of the current orders of this court... it is illegal and the court directs that it cannot be carried out," Griesa said.

In a bid to circumvent Griesa's ruling that banned payments to its restructured debt holders, Fernández said Argentina service debt locally and allow bondholders to swap their debt issued under foreign law for bonds of the same value governed by local law.

As per the plan, the government would open an account at Banco de la Nación in Buenos Aires to make payments on its bonds, stopping services of its US intermediary bank, Bank of New York Mellon.

The government is seeking approval from the congress for the bond restructuring.

Already in recession, Argentina has been looking to repair its economy attracting finances from the international capital market. In a major blow to its reputation, the country fell into a technical default as a result of a dispute with some holdout creditors.

The country has been engaged in a long legal battle with hedge funds led by Elliott Management and Aurelius, which refused to take part in the country's debt restructuring. About 92% of the country's creditors agreed to swap debts and accept less money.

The holdout funds later sued the government for full payment.

Griesa had earlier ruled in favour of the so-called vulture funds, barring Argentina from paying the holders of its restructured debt unless it pays the hedge funds. He has also blocked Argentina's coupon payment to restructured bondholders through Bank of New York Mellon.

The country's settlement talks with the holdout creditors failed and it ended up defaulting on its debt at the end of July.

US Hints at Widening Action Against IS Following James Foley Beheading

US Secretary of Defence Chuck Hagel (L) speaks next to Chairman of the Joint Chiefs of Staff General Martin Dempsey during a press briefing at the Pentagon in WashingtonYuri Gripas/Reuters

The US has sent strong signals that it would go beyond mere airstrikes against Islamic State militants in Iraq and Syria, following the beheading of American journalist James Foley.

Pentagon officials described the militant group as one that is "beyond anything we've seen".

"It is possible to contain them. They can be contained, but not in perpetuity. This is an organisation that has an apocalyptic, end-of-days strategic vision which will eventually have to be defeated," said chairman of the Joint Chiefs of Staff Martin Dempsey at press conference, in which US Defence Secretary Chuck Hagel was also present.

When pressed by reporters about the strategy against the insurgent group, the authorities said: "We're looking at all options."

"Can they be defeated without addressing that part of the organisation that resides in Syria? The answer is no. That will have to be addressed on both sides of what is essentially at this point a non-existent border," said Dempsey.

Highlighting the IS threat, Hagel said: "They are beyond just a terrorist group. They marry ideology, a sophistication of strategic and tactical military prowess. This is beyond anything we have seen, and we must prepare for everything. And the only way you do that is that you take a cold, steely hard look at it and get ready."

The Pentagon officials' remarks come a day after Secretary of State John Kerry said the Sunni insurgent group "must be destroyed".

The US has also not ruled out airstrikes against Syria.

Turkey's Ruling Party Nominates Foreign Minister Ahmet Davutoglu to Succeed Erdogan as Prime Minister

Turkey's new Prime Minister Ahmet Davutoglu.(Reuters)

Turkey's ruling party has nominated Foreign Minister Ahmet Davutoglu to succeed Recep Tayyip Erdogan as the country's prime minister.

"The AK's [Justice and Development Party] candidate for the party leadership on 27 August is foreign minister and member of parliament for Konya, Ahmet Davutoglu," Erdogan said after a meeting of the party's executive committee.

"We will be continuing this struggle together. Being president will not hinder my struggle with the parallel structure," he added.

Erdogan, the current Chairman and Prime Minister of Turkey, was elected as the country's new president earlier this month.

According to Turkish outlet Today's Zaman, Davutoglu's nomination was imposed upon the party by Erdogan, who wishes to rule the government as head of state with a low-key prime minister next to him.

Davutoglu has been the Foreign Minister of Turkey since 2009 after serving as chief foreign adviser to Erdogan.

More to follow...

Dog Death at Hong Kong Station Sparks Social Media Storm

Dog tries to mount platform at Fanling Station shortly before dying and starting a social media firestorm(Facebook)

The death of a dog at a Hong Kong train station has sparked a storm of anger on social media, as well as vigils in honour of the dead hound.

Even death threats have been issued online in the wake of footage showing a dog trapped on the train tracks at Fanling Station

Video showed the dog trying to climb up on to the platform while members of the public and station staff made efforts to retrieve it, shortly after the morning rush-hour.

But attempts to rescue the dog were unsuccessful and one member of staff was reportedly injured in the process.

The dog scampered off about 15 minutes after the episode began and was subsequently hit by a train and killed, reported the South China Morning Post.

Vigil for dog killed at Fanling train station by train(Facebook)

That led furious members of the public to deluge the train operator MTR's Facebook page with more than 1,000 angry messages.

A small vigil complete with floral tributes and messages also took place at the scene.

In the face of the uproar the operator issued a statement, admitting the "unfortunate incident [...] can be handled better" and insisting: "MTR fully respects the lives of animals."

But now an animal welfare group has waded in by demanding a meeting about the rail operator about the incident.

The Society for the Prevention of Cruelty to Animals in Hong Kong told local media: "This incident is extremely unfortunate and tragic. [It could] be avoided if they refer it to professionals."

The incident looks not to be over yet, with MTR being forced to issue yet another statement soon.

Indian Economy to Expand by 5.8% in Fiscal 2014-15

Indian economy to expand by 5.8% in fiscal 2014-15.Reuters

The Indian economy, Asia's third-largest, remains on track to expand by about 5.8% in the financial year to 31, March 2015, the finance ministry's top official has said

Finance Secretary Arvind Mayaram also said India's industrial production data suggested that corporate order-books were building up.

Mayaram said he hoped that the Reserve Bank of India (RBI) will not leave interest rates high for longer than necessary. Falling oil prices will wipe out the cost of diesel subsidies and the government will stick to its fiscal deficit target, he added.

Q1 GDP

New Delhi will put out the April-June first-quarter's GDP figures by the end of the month.

Deutsche Bank economists Taimur Baig and Kaushik Das forecast India's first-quarter GDP growth to rise to its highest level in eight quarters.

They also cautioned that investors had "begun expressing concern" over New Delhi's "perceived lack of urgency in articulating a time bound gameplan for big bang reform," particularly with prime minister Narendra Modi's near three-month old regime focusing "on improving ground execution rather than big bang reform".

IIP picture.Deutsche Bank, Bloomberg Finance

Deutsche Bank said in a 21 August note to clients: "...YOY Industrial Production (IP) growth during the April-June quarter improved appreciably to a 3-year high, from the previous quarter (3.9% vs. -0.5%). This implies a robust pickup in industrial sector GDP growth for April-June which may push the headline GDP growth (data to be reported in end-August) higher by about 100bps than the previous quarter's outturn (4.6%yoy)..."

"...While we agree that articulation of big bang reform is yet to come, we are seeing an urgent focus on policy execution, particularly focused on clearing stalled projects and in attempting to simplify and streamline government processes. The Environment, Power and Road ministries and the Project Monitoring Group in the cabinet Secretariat are currently at the forefront of execution.

"In our view an urgent focus on project clearances, simplifying regulation and streamlining approvals is far more critical in catalysing a manufacturing revival and create an environment conducive for a manufacturing turnaround. However investor patience may be tested if an articulation on big bang reform accompanied with a time bound gameplan is not forthcoming over next few months. We remain confident that the government will move towards big bang reform progressively with the announcement of a gas price hike to incentivise domestic production and passing the insurance amendment bill by year end," the bank added.

The Indian economy expanded by just 4.7% in the financial year 2013-14, marking the second full year of sub-5% growth.

Hong Kong Faces Financial District Shutdown Over Political Stand-Off With China

Protesters join hands as they look at fellow protesters being dragged away by the police on a street at Hong Kong's financial Central district in July(Reuters)

Hong Kong's financial district could be shut down in September after Chinese officials and Hong Kong democrats failed to break a political deadlock over reforms.

The former British colony has witnessed popular protests during the past year over the way its leader is chosen in 2017.

Hong Kong democrats have campaigned for the right to elect a leader by popular vote, while Beijing has insisted the next leader is chosen from a list of pro-Beijing candidates.

A pro-democracy campaign group called Occupy Central has vowed to blockade Hong Kong's Central business district if Beijing does not allow open nominations.

Beijing is expected to limit the candidates to pro-China "patriots" and those who "love China".

Hong Kong lawmakers met with Chinese officials in the city of Shenzhen on 21 August but the two sides failed to reach a compromise ahead of next week's parliamentary meeting in Beijing where officials are expected to reveal Beijing's position on the 2017 elections.

"We will also not allow public nomination of chief executive candidates, occupying central and other related crimes. This remains one of the biggest arguments in Hong Kong today," said Li Fei, chairman of China's Basic Law Committee, after the meeting.

Hong Kong was returned to China from the British in 1997 and has been governed under a different system to the mainland.

Freedom of speech, religion and assembly have been more widely respected on the islands but China has stressed its supremacy is unquestionable.

A shutdown in the beating heart of Hong Kong's financial centre would hurt its economy and global reputation as a stable location for business.

Gaza Strip: Israeli Air Strikes Kill Three Senior Hamas Commanders and Three Children

Israel has killed three senior Hamas commanders in an air strike on the Gaza Strip, a clear sign that Israel is intent on eliminating the group's military leadership.

Hamas named the men as Mohammed Abu Shammala, Raed al-Attar and Mohammed Barhoum and said they were killed in the bombing of a house in Rafah.

The pre-dawn strike levelled a four-storey house in a densely populated neighbourhood, killing six people, including the three senior Hamas commanders.

The Israeli military and Shin Bet, the internal security service, confirmed that two of the men had been targeted. The trio had played a key role in expanding Hamas' military capabilities in recent years, including digging covert tunnels leading to Israel, training of fighters and smuggling of weapons to Gaza, Israel said.

(L-R) Raed al-Attar, Mohammed Abu Shammala and Osama Abu Atah from Hamas are seen on February 27, 1999. An Israeli air strike killed three senior Hamas military commanders in the Gaza Strip on August 21, 2014. Hamas named the men as Mohammed Abu Shammala, Raed al-Attar and Mohammed Barhoum(Reuters)

Palestinians watch as rescue workers search for victims under the rubble of a house destroyed in an Israeli air strike that killed three senior Hamas military commanders in Rafah(Reuters)

Palestinian rescue workers use an excavator to help remove the body of a man from under the rubble of a house in Rafah(Reuters)

A Palestinian man inspects the wreckage of a car, which witnesses said was hit by the Israeli air strike that killed three senior Hamas military commanders in Rafah(Reuters)

As well as the Hamas commanders killed, Palestinian medics reported 19 other deaths on Thursday, including three children.

"Three children, aged 7, 8 and 11, were killed in an Israeli strike in eastern Gaza City," said a Gaza HealthMinistry spokesman.

Tarek al-Rifi, the father of one of the three children from the Al-Rifi family killed in an Israeli military strike, reacts at Gaza city's Al-Shifa hospital(AFP)

The grandfather of the Al-Rifi children cries outside a hospital morgue in Gaza City(Reuters)

A Palestinian man mourns over the body of his relative, Rami Abu Nahel, killed in an Israeli military strike, at Gaza City's Al-Shifa hospital(AFP)

The relatives of an Islamic Jihad militant from the Abu Nada family, killed in an Israeli air strike, mourn at a hospital morgue in the northern Gaza Strip(Reuters)

Gaza militants resumed rocket fire on Israel as talks broke down on Tuesday, even before the formal end of a six-day truce at midnight that day.

Since then, Hamas and other groups have fired dozens more rockets, and Israeli aircraft have struck dozens of targets in Gaza, a sign that prospects for a resumption of the Cairo talks are slim.

A picture taken from the Israeli side of the border shows rockets being fired by Palestinian militants from the Gaza strip into Israel(AFP)

An Israeli firefighter extinguishes fire after rockets fired by Palestinian militants from the Gaza strip hit a field near the southern Israeli city of Sderot(AFP)

Smoke rises following an Israeli air strike in Gaza(Reuters)

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Isis Video Shows Iraqi Yazidis Converting to Islam

Isis (known as the Islamic State) has released a video in which dozens of captured members of Iraq's Yazidi sect are converting to Islam.

The footage emerged after the Islamist group issued a video showing the murder of US journalist James Foley at the hands of a black-clad militant. The Yazidis are followers of an ancient and secretive Mesopotamia-based religion that stems from Zoroastrianism and are considered as devil-worshippers by IS.

Sunni militants stormed into villages in north Iraq forcing them to flee into neighbouring Kurdistan region. Those who stayed were given a simple option: convert to Islam or die. Hundreds of Yazidis were shot dead and women and children buried alive. Many women were taken away as slaves and raped.

But the Isis propaganda video, called "Hundreds of Yazidis convert to Islam" seeks to overturn the brutality exposed by numerous Yazidi witnesses. Two Sunni fighters reply to questions in Arabic from an Isis interviewer: "What has been said is the opposite of reality," the older man says, adding that the group provided Yazidis with everything they need.

"Men, women and children have converted and I was with them and they are happy with their conversions," he says, adding: "We advise the Yazidis to come down from the [Sinjar] mountain [siege] and convert.

"If they stay on the mountain, they will die of starvation and thirst. This talk about aid from Western and crusader countries is all lies. If they convert, we will give them everything they need. They will live a happy life."

Then, the video shows dozens of Yazidis getting off a bus, walking past a truck mounted with an anti-aircraft weapon and hugging Isis militants. After a few moments, hundreds of Yazidis are shown sitting on the floor of a school beneath black Isis flags. "Right now you are infidels. After this you will become Muslims and you will have rights," an ISIS fighter tells them. "Repeat after me."

Hundreds of Yazidis are shown sitting in a school beneath black Isis flagScreengrab

Toyota Cuts Lexus Spare Parts Prices in China Amid Heightened Antitrust Scrutiny

The 2014 Lexus ISIBTimes/Charles Poladian

Japanese car maker Toyota said it will reduce prices of auto parts for the luxury Lexus car models in China in light of the government's anti-trust probe into the automotive sector.

A statement published on the Lexus website in China said prices of about 15,000 parts will be cut by an average 26% from September, taking into account the government's concerns over prices.

China's National Development and Reform Commission (NDRC), the country's price regulator, earlier said it is probing more than 1,000 domestic and foreign firms in the auto sector over monopolistic practices.

"In response to the NDRC's concerns over monopoly practices in the industry, Lexus China will cut prices of spare parts in China starting from September 1," the company said.

"The company will ensure full compliance with the Chinese law, improve management behaviour ... protect interests and rights of customers and contribute to the China auto industry."

Prices of radiators will be cut by 35%, while that of automatic transmission systems and air bag systems will be down by 30% and 25%, respectively.

Lexus joins other foreign automakers such as BMW, Mercedes-Benz and Audi who lowered prices of auto parts in response to China's antitrust probe into the industry.

The move by Toyota comes after the NDRC levied a record 1.24bn yuan ($200m, €150m, £120m) fine on eight Japanese auto-parts makers and four bearings manufacturers for their collusive behaviour. The amount is almost double the 670m yuan fine imposed on six baby food makers in 2013.

In addition, Mercedes-Benz, owned by Germany's Daimler AG, had been found guilty of breaking anti-monopoly laws in China by manipulating prices for after-sales services in the country, according to the official Xinhua news agency.

The anti-monopoly investigations into the Mercedes-Benz dealers are still underway, Xinhua added.

The local price regulator in central China's Hubei province earlier announced a combined fine of 1.6m yuan for four BMW dealers in the province, who were found to have formed a price alliance.

NDRC had earlier said it found similar monopolistic practices at Chrysler and Audi.

Avoid 'Dangerous' Central London, UAE Tourists Told

Prince Charles, Prince of Wales meets with President of the United Arab Emirates, Sheikh Khalifa bin Zayed Al Nahyan during his visit to Clarence House on 1 May 2013(Getty Images)

London's Oxford Circus, Edgware Road and Piccadilly Circus ought to be considered "areas to avoid" for Emirati tourists in the capital because of the danger of crime, according to a UAE statement.

The unusual remarks, given the popularity of London among Gulf Arab tourists who seek to escape summer heat in the homeland, come after two violent attacks on Emirati tourists in 2014.

Three Emirati women and their children were attacked by a hammer-wielding man at a Marble Arch hotel in April. A gang of masked robbers assaulted an Emirati and his wife in their London apartment in Westbourne Gardens, Paddington.

The UAE's foreign ministry told citizens to avoid areas "where pickpocketing, fraud and theft are frequent and where it is not advised to live". It also attached a map of "more dangerous areas", including Soho, Oxford Circus and Edgware Road, and "less dangerous areas", featuring Shepherd's Bush and Queensway.

The Met Police reacted to the statement by saying London was one of the safest major cities in the world. "There is absolutely nowhere in London which should be avoided," Metropolitan Police Service Commander Makhdum Chishty said in a statement, according to Reuters.

"We understand the incident involving Emirati nationals earlier this year was shocking, but it was also very, very rare."

UAE foreign ministry statement on its website

James Foley Beheading: US Journalist 'Brutally Punished' for Escape Attempt by Isis Militants

US journalist James Foley reportedly attempted to escape Islamic State militants prior to his death(Nicole Tung/Free James Foley)

A former hostage held by Islamic State militants has revealed US journalist James Foley, who was beheaded in a video released on Tuesday, had previously tried to escape from his captors.

Nicolas Henin, a freelance French reporter who was captured in 2013 and remained a prisoner for 10 months before his release in April, said Foley had received a "brutal punishment" for planning to escape.

Speaking to ABC News, Henin said Foley had been punished both for his escape plans and as an outlet for the militants' frustrations over the US "war on terror".

"James was a bit punished for a presumed attempt to escape, but it had no real chance," he said.

Henin, who had been held alongside Foley for around seven months, said he was not willing to provide details of the nature of the punishments out of respect for Foley's family. He added that the video was "extremely shocking" because he could easily have been in Foley's place.

"For instance, the shoes that he was wearing when he was taken to this place in the desert, I wore them. We had few shoes that we were using to go to the bathroom and we were sharing them," he said.

Foley was executed by a militant from the Islamic State, allegedly with a British accent, at an undisclosed location in a video released this week. The 40-year-old journalist was taken hostage while reporting in Syria in November 2012.

The news of his attempted escape comes as the Pentagon announced that in the months leading up to Foley's death, the US launched a risky but unsuccessful rescue mission in Syria.

Confirmation of the failed night-time raid, which took place earlier this summer, came after a day of debate over whether the Obama administration had done enough to save Foley's life.

It represented the first confirmation of US military operations in insurgency war-ravaged Syria, where Isis gestated into the jihadist organisation that has redrawn the borders of the Middle East.

On Wednesday, President Barack Obama pledged to "confront this hateful terrorism and replace it with a sense of hope and civility".

IS militants reportedly demanded a multi-million dollar ransom in exchange for Foley's release, but the US reportedly refused to pay it before he was killed.

According to the New York Times, the group pressed the US to provide $100m, according to a representative of Foley's family and a former hostage held alongside him.

Hot Shots Photos of the Day: Aurora from Space, Giant Rubber Duck, Human Milk Bank

Reid Wiseman, an astronaut on the International Space Station, took this photo of an aurora dancing around the Earth's atmosphere. 'Never in my wildest dreams did I imagine this,' he tweeted@astro_reid

An aerial view shows a flooded highway after heavy rainfall hit Lishui, Zhejiang province, China(Reuters)

A young man rescues a stranded pig on a makeshift raft after heavy rainfall hit Lishui, Zhejiang province, China(Reuters)

Firefighters and police officers search for survivors at a site where a landslide swept through a residential area at Asaminami ward in Hiroshima, western Japan(Reuters)

A giant inflatable rubber duck installation by Dutch artist Florentijn Hofman floats through the Port of Los Angeles as part of the Tall Ships Festival, in San Pedro, California(Reuters)

A man takes a selfie as he stands with a Ukrainian flag on a Soviet-style star retouched with blue paint so it resembles the yellow-and-blue national colours of Ukraine, atop the spire of a building in Moscow(Reuters)

Bottles of human breast milk are pasteurised at the general hospital in Medellin, Antioquia department, Colombia. The region's first Human Milk Bank opened recently, with the aim of reducing the mortality rate in premature infants(AFP)

A nurse holds the hand of a premature baby, born at five months, after feeding it with expressed breast milk on the first day of donation at a hospital in Medellin, Colombia(Reuters)

Health workers wearing protective clothing prepare to carry an abandoned dead body at Duwala market in Monrovia. To try to control the Ebola epidemic spreading through West Africa, Liberia has quarantined remote villages at the epicentre of the virus, evoking the 'plague villages' of medieval Europe that were shut off from the outside world(Reuters)

Liberian security forces stand in front of protesters after clashes in the West Point slum in Monrovia. Police fired live rounds and teargas to disperse a stone-throwing crowd trying to break an Ebola quarantine imposed on their neighbourhood(Reuters)

Indonesian police fire a tear gas canister as they try to disperse supporters of presidential candidate Prabowo Subianto during a protest near the Constitutional Court in Jakarta. Losing candidate Prabowo has asked the Constitutional Court to overturn the election result, saying the vote in the world's third largest democracy was tainted by mass fraud(Reuters)

Security forces charge demonstrators after being hit by water bottles during a protest against the shooting of unarmed black teen Michael Brown in Ferguson, Missouri(Reuters)

A demonstrator protesting against the shooting death of Mike Brown in Ferguson, Missouri carries a sign reading: 'Go kill Isis and leave us alone'(AFP)

Shi'ite volunteers, who joined the Iraqi army to fight against militants of the Islamic State, take part in field training in Najaf(Reuters)

Tarek al-Rifi, the father of one of the three children from the Al-Rifi family killed in an Israeli military strike, reacts at Gaza city's Al-Shifa hospital(AFP)

An Israeli firefighter extinguishes fire after rockets fired by Palestinian militants from the Gaza strip hit a field near the southern Israeli city of Sderot(AFP)

A pro-Palestinian flag is seen hanging from the Manhattan Bridge in New York. Pro-Palestinian demonstrators also marched across the Brooklyn Bridge(Reuters)

Israeli Air Strikes Kill Three Senior Hamas Commanders

Raed Attar, killed by Israeli air strikes, played a major role in the kidnapping of Gilad Shalit (in the picture) (Reuters)Reuters

Israeli forces have killed three senior Hamas military commanders in an air strike on the Gaza Strip, according to reports.

The Islamist militant group named the men as Mohammed Abu Shammala, Raed al-Attar and Mohammed Barhoum and said they were killed in a bombing of a house in the southern town of Rafah.

The Israel Defense Forces (IDF) said that "two senior terrorist commander of Hamas military wing", the al-Qassam brigades, were killed overnight by air forces. It did not mention the death of Barhoum.

The IDF said aircraft carried out 20 assaults in Gaza on Thursday. A Hamas spokesman said: "Israel will pay a heavy price for assaulting our commanders".

The IDF said that Raed Attar "played a major role in tunnel infiltrations, terror attacks that killed Israelis, and the kidnapping of Gilad Shalit".

Gilad Shalit is an Israeli soldier who wa held captive in Gaza for five years by Hamas and freed in 2011 in return for the release of 1,027 Palestinian prisoners. The Israel Forces added that Abu Shamala, commander of Hamas forces in Gaza "was directly involved in dozens of terror attacks, including the murders of IDF soldiers".

The statement did not mention Hamas' top military commander, Mohammed Deif, who was targeted later on Tuesday by Israeli forces. Deif's wife and seven-month-old son were killed in the air strike. Israeli analysts stated that Deif was at the house and that it was almost impossible for anyone to survive after the bombing. The death toll in Gaza rose to 2,050 Palestinians killed in the fighting, the majority of them civilians.

The killings came after al-Qassam brigades spokesman Abu Obeida threatened to strike Ben Gurion airport on Tel Aviv calling for airlines to suspend flights from 6am.

Egyptian-brokered talks to end fighting in the Gaza Strip collapsed on Tuesday when violence broke out.

Former Malaysia Airlines CEO Idris Jala Denies Rumours of Return to Ailing National Carrier

Malaysian Airlines FlagReuters

An economic policy maker in Malaysia, who previously headed Malaysia Airlines (MAS), denied media reports that he is one of the candidates to head the ailing carrier.

Idris Jala, who is a minister in the Prime Minister's Department, denied the rumours on Twitter.

He noted that he will continue in his present role as CEO of the government's Performance Management and Delivery Unit (Pemandu). Jala currently heads the Malaysian government's Economic Transformation Programme through Pemandu.

Jala was the airline's CEO from 2005 to 2009 before joining the top government job, and he is well known for turning around the firm from heavy losses through hefty cost-cutting measures.

"I've seen online reports speculating that I will be returning to MAS. I am not heading there. I will continue in my present role," Jala said in a Twitter post.

I've seen online reports speculating that I will be returning to MAS. I am not heading there. I will continue in my present role

— idris jala (@IdrisJala_) August 21, 2014

A local newspaper earlier reported that Jala and Jamaludin Ibrahim, the CEO of state-controlled telecoms firm Axiata, were two leading candidates being considered by state-fund Khazanah Nasional, which is looking to revive the disaster-hit national carrier.

MAS is set to be taken private by state fund and majority shareholder Khazanah Nasional. As per the plan, Khazanah Nasional will take over minority shares for 1.38bn ringitt ($429m, €321m, £255m) to become the sole owner of the airline, leading to the delisting of the company from the country's stock exchange.

Adding to its longstanding financial problems, MAS was hit by two major disasters in 2014.

In March, its flight from Kuala Lumpur to Beijing disappeared with 239 people on board. A search is under way in the Indian Ocean for the missing plane.

In July, another MAS flight heading to Kuala Lumpur from Amsterdam was shot down in eastern Ukraine, which is controlled by pro-Russian separatists, killing 298 people.

How Argentina's Debt Crisis and Brazil's Civil Unrest are Eclipsing Latin America Opportunities

Demonstrators burn a Brazilian flag during a protest against the 2014 World Cup in Rio de JaneiroReuters

News stories emanating from Latin America rarely frame the region's economy in a positive light.

This summer's excellent World Cup – while not eclipsed on the field – was against a backdrop of strikes and civil unrest in Brazil's major cities. Similarly, Argentina's President Cristina Kirchner and her government were forced to default on their debts for a second time in thirteen years.

The negative image that these high-profile stories create does not do justice to the economic transformation taking place in Latin America or the investment opportunities the region now offers to business.

As the economies of Brazil and Argentina have stumbled, other countries in the region have seized the opportunity to attract more inward investment. In the bustling Colombian city of Medellin this week, there is so much visible evidence of this transformation.

The recently announced merger between Millicom-owned telecommunications company Tigo and the publicly-owned provider UNE here will create a business with over $2bn in revenue and have over eight million customers.

It illustrates the growing confidence that investors are now placing in Latin America's consumer market. Having just joined Millicom after five years at Caribbean-focused telecom company Cable and Wireless, the opportunity to be part of a merger of this size highlights the scale of the economic transformation currently taking place in the region.

UNE is based in Medellin, the city once famous for drug trafficking and lawlessness. The city has undergone a transformation in recent years and was last year awarded the title of 'World's Most Innovative City' by the Wall Street Journal, demonstrating the changes that have taken place in Colombia and the wider trend towards privatisation and expanding investment opportunities.

Colombia's GDP grew by an impressive 6.4% in the first quarter and in 2014/2015, and the World Bank has forecast economic growth in Colombia at 4.6%. This figure contrasts significantly with the predicted stagnation of the economies in the continent's traditional powerhouses, Brazil and Argentina.

UK exports to Latin America continue to grow at a fast pace, and newer markets are no longer being restricted by their larger regional neighbours. As former foreign secretary William Hague said in a speech last year, 'my message to British business is simple: go and take advantage of what the region has to offer; invest, compete and make yourselves part of Latin America's rise'.

The UK is now the fourth largest investor in Colombia.

This is in large part due to the current Colombian government's ability to implement successful economic policies and bring security to the population. President Juan Manuel Santos was inaugurated into office last Thursday for a second term, showing these reforms are popular with the people as well as business.

Rapid economic growth has fuelled the development of an emerging middle class. Today, almost a third of Latin American families now belong to the middle-classes, which has led to an increase in the demand for high-quality consumer goods and services.

The telecommunications and media sector in Latin America is set to continue growing at a rate of nearly three times the global average, boosted by these new consumers. The growth in services shows that the region is successfully diversifying its economy away from commodities.

By investing in private enterprises that improve the quality of the services provided to the burgeoning middle classes, the telecommunications industry constitutes part of an essential infrastructure transition that can enable Latin American economies to sustain their impressive rates of growth.

Tim Pennington is chief financial officer of Millicom, a telecommunications and media company operating across Africa and Latin America.

AirAsia to Benefit From Lower Capacity as MAS Revamps Operations

Air Asia aircraft model 9M-AQB is seen on track at Low Cost Carrier Terminal (LCCT) airport at Sepang outside Kuala Lumpur.Reuters

The ongoing restructuring at disaster-hit Malaysian Airline System Bhd (MAS) is expected help direct competitor AirAsia Bhd.

Analysts expect that the restructuring of MAS would lead to lower capacity in the sector, easing price pressures that dented AirAsia's profitability.

Malaysian carriers, MAS and AirAsia, have been engaged in a price war in recent years after they added capacity to retain market share.

Things have become worse as Malindo, an affiliate of Indonesia's Lion Group, entered Malaysia's aviation sector in 2013, putting further pressure on yields.

For fiscal year 2013, AirAsia's net profit declined 54% primarily due to adverse foreign exchange rates and intense price competition in the home market.

Nevertheless, the company is expected to do better this year.

"We remain convinced that AirAsia will be able to weather the cut-throat competition and emerge as the final victor," AllianceDBS analyst Tan Hee Kong was quoted as saying by Reuters.

"A more benign competitive landscape is finally around the corner with MAS expected to cut back on capacity next year."

While announcing the company's latest quarterly results, Group CEO Tony Fernandes said airline capacity in the region and Malaysia will return to a "realistic" level in the second half of 2014.

"We foresee capacity in Malaysia reducing and there will a re-alignment of business strategy by competitors to ensure sustainability," he said.

AirAsia's net profit rose to 367.16m Malaysian ringgit ($116m, £70m, €87m) in the three months ended June from last year, as revenue rose to 1.31bn ringgit from 1.25bn ringgit.

Average fares continued to decline in the quarter, but at a slower pace than in the previous quarters. The company noted that prices will go upwards as "irrational pricing of competitors is diminishing".

Khazanah Nasional, which owns 69% of Malaysia Airlines (MAS), earlier announced a restructuring plan for the airline, leading to the delisting of the company from the country's stock exchange.

As per the plan, Khazanah Nasional will take over minority shares for 1.38bn ringitt to become the sole owner of the airline.

Adding to its longstanding financial problems, MAS was hit by two major disasters in 2014.

In March, its flight from Kuala Lumpur to Beijing disappeared with 239 people on board. A search is under way in the Indian Ocean for the missing plane.

In July, another MAS flight heading to Kuala Lumpur from Amsterdam was shot down in eastern Ukraine, which is controlled by pro-Russian separatists, killing 298 people.