World Briefing

By Smita Madhur; Barbara Kiviat

Taking Off from Gate 3: Tourism

Tourists are on the move again--and the beleaguered travel industry is breathing a sigh of relief. According to a report by the International Air Traffic Association (IATA) released last month, global air-traffic levels in the first five months of this year have been 8.8% above those of 2000, the last normal year for the industry (before SARS and terrorism struck). The Madrid-based World Tourism Organization (WTO), a United Nations agency, echoes the good news. It expects tourism to grow 5% in 2004. The WTO reports that France is the most popular tourist destination this year. Asia is also rebounding from last year's devastating SARS season: compared with 2003, Asian airlines' passenger traffic was up 108% in May, according to IATA, and international arrivals in April rose 120%, reports the WTO. Hotel business is on the upswing too. Says John Wolf, a Marriott International spokesman: "We're experiencing strong leisure-travel demand globally." But the tourism trade can't rest easy yet: more people may be leaving home, but the WTO says they're likely to spend less money than they did four years ago.

Catering to Highflyers

Had to shell out a few bucks for an in-flight meal recently? That's because cost-cutting airlines don't want to pay for expensive food anymore. So the now empty-handed caterers are going after your business directly. Leading the way are two of the industry's biggest caterers, Switzerland-based Gate Gourmet Group Inc. and Germany-based LSG Sky Chefs. "Before, our customer was the airline," says David Siegel, former president and CEO of US Airways Group Inc. and Gate Gourmet's newly appointed chairman and CEO. "Now, it is the passenger." How do passengers feel about forking over money for food? Dalene Nichols, spokeswoman for Sky Chefs, says its customers "are embracing the concept." In fact, recent company surveys show that 87% of them think Sky Chefs meals are a good value. Audrey McCool, professor of food-and-beverage management at the University of Nevada in Las Vegas, isn't so sure. On a recent flight, she was served a sandwich that was "smashed together." Cost: $7.

EXECUTIVE SUMMARY Give Way to the Wackos

Author John Putzier has a bone to pick with organizations that treat their employees as if they were all clones of one another. In his new book, Weirdos in the Workplace, Putzier argues that even the quirkiest employees--from crazy Annie, who talks to her pets on the phone once a day, to annoying Lester, who pesters you to buy his daughter's Girl Scout cookies--have their merit. The book contains humorous real-life case studies that exemplify the growing phenomenon of "doing your own thing." After all, we live in an age of Fear Factor and Survivor, in which "everyone wants their 15 minutes of fame," says Putzier. Tolerating employees who are different might be a sensible management mantra, but Putzier offers up little more than commonsense tips to managers on how they can use even the strangest workers to their company's advantage.

The Compliance Trade

If you can't beat them, hire them. Under pressure from the Sarbanes-Oxley Act to improve corporate oversight, Wall Street firms are beefing up their legal departments with one former government regulator after another. "Many of our clients are looking for people with strong regulatory sensibilities," says Susan Kurz Snyder of Greene-Levin-Snyder Legal Search Group, an executive-recruitment firm. In the past year, Eric Dinallo from New York attorney general Eliot Spitzer's office and the SEC's Patrick Patalino have switched over to Morgan Stanley and Credit Suisse First Boston, respectively. The latest defector: Beth L. Golden, Spitzer's former deputy of special projects, who becomes the global head of compliance at the Bear Stearns Cos. next month. Bear Stearns has received requests for information and subpoenas from many federal and state agencies, including Spitzer's office, regarding mutual-fund-trading investigations. Not that Golden can help. An ethics law bars her from working on cases involving her former employer for the next two years.

How Sweet It Is

Tate & Lyle is on a sugar rush. After just four years in stores, the British firm's no-calorie sweetener sucralose (brand name Splenda) accounts for 43% of U.S. retail sugar-substitute sales (excluding Wal-Mart). That beats Equal and Sweet'n Low, according to market researcher Information Resources. In a deal with Tate, McNeil Nutritionals, a Johnson & Johnson division, is rolling out a sugar-Splenda blend for baking in August. Splenda, already used in thousands of manufactured foods (one appeal: it withstands heat better than alternatives do), is also going into new mid-calorie sodas from Coca-Cola and PepsiCo. Earlier this year, Splenda was okayed for sale in the European Union. Tate is spending $30 million to expand its sole Splenda plant, in Alabama. The potential catch: many Splenda users are converting from real sugar--Tate's main business. Says Charlie Mills, an analyst at Credit Suisse First Boston in London: "People are forgetting how much of Tate's other business can be threatened by this." --By Barbara Kiviat

Banking on Singapore

It's tough to be a foreign bank in Singapore. To protect the local banking industry, the Southeast Asian city-state limits the number of automated-teller machines, or ATMs, that foreign banks can operate and restricts their access to local ATM networks. Citibank has found a way around this: become Singaporean. The bank, which currently has four branches in the country, plans to spend about $880 million by year-end to incorporate as Citibank Singapore Ltd. Citibank wants "to grow its international business and to be embedded in the local community," says Sophia Tong, a spokeswoman for Citibank in Singapore. Citibank has already localized in Malaysia and Australia and plans to do so in Hong Kong. But its status as the first foreign bank to go local in Singapore gives it a competitive edge: it can negotiate with local banks for ATM access as early as mid-2006, 18 months earlier than other foreign banks.