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DEBT CRISIS

Belgian negotiators reach deal in bid to calm markets

BRUSSELSBelgium’s chief negotiator said Sunday the 2012 budget that he clinched after a world-record government stalemate will meet the demands of the European Union and hoped it would calm nervous markets.

EU monetary affairs chief Olli Rehn welcomed the announcement of the breakthrough and said EU officials would soon review the budget text to see if it meets his recommendations of fiscal rigor and increased competitiveness.

Elio Di Rupo said that next year’s budget will have a deficit of 2.8 percent of GDP to remain within the EU target. He called the $14.95 billion in austerity measures a step toward assuring a balanced budget in 2015 and the toughest measures taken by the nation in some 70 years.

Mr. Di Rupo is now expected to lead a grand coalition of socialists, Christian democrats and liberals, each split into Dutch- and French-speaking parties. Belgium has had only a caretaker government since June 13, 2010, as a series of negotiators failed to bridge the divide between the country’s 6.5 million Dutch-speakers and 4.5 million French-speakers.

But the talks were given much greater urgency late Friday when Standard & Poor’s downgraded Belgium’s credit rating, potentially leading to increasing interest rates and a downward financial spiral.

ENERGY

Iraq, companies finalize $17 billion natural-gas project

BAGHDAD — Iraq finalized a $17 billion joint venture deal with Shell and Mitsubishi to capture and process gas from its southern oil fields, at a ceremony at the oil ministry on Sunday.

The deal was signed by Shell CEO Peter Voser, Mitsubishi Vice President Tetsuro Kuwabara and Iraqi Oil Minister Abdelkarim al-Luaybi.

“Today’s event represents a big change in the oil industry,” Mr. al-Luaybi said, adding that the deal constitutes the best use of the gas in line with Iraq’s needs.

Earlier this month, the Iraqi Cabinet approved the deal that creates the Basra Gas Company, a joint venture to process associated gas from the Rumaila, Zubair and West Qurna-1 fields.

State-owned South Gas Company will hold a majority 51 percent stake in Basra Gas, while Shell will have 44 percent and Mitsubishi 5 percent, government spokesman Ali al-Dabbagh said. The output capacity of the proposed project will be two billion cubic feet, or 56.6 million cubic meters, per day, he said.

DEBT CRISIS

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