Kyodo economic news summary -3-.

TOKYO, Oct. 16 Kyodo

---------- Japan, Mexico to continue talks on FTA

TOKYO - Japanese Prime Minister Junichiro Koizumi and Mexican President Vicente Fox agreed Thursday to continue negotiations on a bilateral free trade agreement (FTA) with a view to reaching agreement by the end of the day.

''It's 90% complete,'' Koizumi told a joint press conference with Fox after their summit talks.

---------- World Bank raises Japan's 2003 growth projection to 1.9%

WASHINGTON - The World Bank on Thursday substantially raised its 2003 economic growth projection for Japan to 1.9% from the 0.8% growth estimated in September.

But growth in the Japanese economy is expected to fall to 1.2% in 2004, the Washington-based institution said in a semiannual update on economic conditions in East Asia.

---------- Moody's raises China, H.K., Macao foreign currency ratings

HONG KONG - Moody's Investors Service said Thursday it has upgraded China's foreign currency ratings and, in conjunction, the ratings of Hong Kong and Macao, the two Chinese special administrative regions.

The U.S.-based international credit rating agency elevated China's foreign currency bond ceiling and rating to A2 from A3, expecting the Chinese government will keep maintaining a strong external payments position to ''provide adequate insulation from underlying domestic pressures and potential external shocks.''

---------- Moody's upgrades outlook for Mitsui Engineering & Shipbuilding

TOKYO - Moody's Investors Service said Thursday it has changed the outlook on the B1 senior unsecured long-term debt rating of Mitsui Engineering & Shipbuilding Co. to positive from stable due to the company's improved earnings and credit profile.

''The company's operating performance has shown improvements over the last few years, mainly supported by its strong competitiveness in shipbuilding and the relatively stable performances of its machinery division,'' the U.S. credit-rating agency said.