The Irish Independent reports that the Irish economy was battered by two major shocks yesterday amid new fears of a global slowdown.

The Irish Independent also reports that Smurfit Kappa chief executive Gary McGann yesterday excluded hedge funds from the Initial Public Offering (IPO) of the largest maker of paper packaging in Europe, while raising €1.3bn (£890m) in a dual listing on the Irish and London stock exchanges.

The Irish Times reports that European Central Bank (ECB) president Jean-Claude Trichet has said expectations of inflation in the euro zone are "excellently anchored".

Mr Trichet was speaking at a meeting of the European Policy Institute in London yesterday, after global stock markets experienced significant falls in share values prompted by fears for the US economy.

The ECB last week raised interest rates by one-quarter of a percentage point and several analysts have predicted at least one further rate rise this year.

While not providing a clear signal, Mr Trichet's remarks may imply that the ECB regards inflation as less of a threat than in the ECB's latest forecasts, produced before global falls in share prices last week and this week.

Mr Trichet said the ECB would continue to exercise its judgment on interest rates, free from political interference. "The level of our independence is very, very precise. We are not supposed to receive or ask for instruction," he said.

But comments in the latest quarterly report of the Dutch Central Bank suggest that pressure for higher rates persist.

"The policy of the ECB is still accommodative, considering historically low interest rates and the rapid growth of money supply and credit," it said yesterday, suggesting its governor Nout Wellink - who sits on the ECB's governing council - will argue for a further interest rate rise in June.

The Irish Times also reports that a total of 470 job losses were announced at three separate companies yesterday as the spate of redundancies from international and Irish firms continues.

French pharmaceutical company Sanofi-Aventis said it was closing its plant in Waterford with the loss of 200 jobs, while mobile-phone company O2 Ireland confirmed that it was seeking 100 redundancies among its 1,800 workforce.

A further 170 jobs are to go at packaging company Ire-Tex after the High Court made orders for the winding up of the company on Tuesday. About 85 people had already been laid off from the company in January.

The winding-up order came when the company was unable to find a new investor after its main customer, Dell, terminated a long-running contract.

O2 Ireland said it was now entering into a 30-day consultation process with staff as it seeks 100 compulsory redundancies following an annual review of the business.

O2's decision follows that of rival Vodafone, which is to cut 80 jobs, and is largely seen as a response to increased competition in the Irish mobile-phone market from new entrants such as Meteor.

"Anyone following the mobile-phone market will see how it has changed and we have to acknowledge that and respond to that," said a spokeswoman for O2.

"We have to compete as effectively as we can. The company is looking right across the business for efficiencies and cost savings and, unfortunately, this is one of the steps we have to take," she added.

Waterford TD Brian O'Shea (Labour) said the announcement of the proposed closure of the Sanofi-Aventis plant in Waterford was a very significant loss to the city and to the southeast, and was a worrying example of the wider haemorrhaging of highly-skilled jobs.

"It has been a bad week on the jobs front for the country, and Munster especially, with significant cutbacks at factories in Nenagh, Cork and Limerick. For too long, the Government has been complacent about the employment picture. This complacency has resulted in announcements such as we have had today," he said.

The Irish Examiner reports that close to €41 million is to be distributed among the six children of the former Minister for Foreign Affairs, Peter Barry.

It follows the winding up of an investment and property group, Skeabost, owned by Mr Barry’s children. Each will receive close to €7m as the company is wound up.

This payout does not in any way involve the distribution of assets or the winding down of Barry’s Tea, a spokesman for the company said yesterday.

Barry’s Tea is jointly owned by former minister Peter Barry and his son Tony who has been chief executive of the company for some time.

Cllr Deirdre Clune, 47, the former Fine Gael TD, is among those who will gain from the distribution of the profits from the investment company. She is a former Lord Mayor of Cork like her father and her grandfather, Anthony Barry.

She will fight the upcoming general election in the Cork South Central constituency on behalf of Fine Gael.

The other gainers from the distribution of the €41m are brothers Tony Barry, 46, who manages the Barry’s Tea business, Donagh, 43, involved in catering distribution in Dublin, Conor, 41, who lives in Canada and Peter Jnr, 40, who works in the tea trade outside the family business. Their sister Fiona MacCarthy is also a beneficiary.

It is understood the sell off of the business involves the winding up of Skeabost and Zonergem, another company involved in the property and investment business.

For a number of years both companies were part of the overall Barry’s Tea operations while the property and investment business was being built up.

It is not clear why they were separated out in the first instance from the tea operations, but it may have been linked to Mr Tony Barry assuming joint control of Barry’s Tea with his father Peter.

A spokesman said the break up of the business has to do with “restructuring” which is just another way of saying the six children of Mr Barry Snr are cashing in their chips.

Peter Barry served as a minister in the governments led by Liam Cosgrave and Dr Garret FitzGerald.

The restructuring does not affect the tea business which is a recognised national brand and is continuing to grow its share of the Irish tea business.

Barry’s Tea took out unlimited liability status some time back and is not obliged to file public accounts.

Barry’’ Tea has been a national brand for many years, commanding widespread consume loyalty.

It was established by Peter Barry’s grandfather James J Barry.

Barry’s tea was sold mainly from its shop in Princes Street, Cork until the 1960s.

The Financial Times reports that efforts to forge a new transatlantic aviation pact suffered a new blow on Wednesday with the emergence of bipartisan opposition in the US Congress to the current form of the deal agreed last month.

The opposition revives the furore over foreign investment in US carriers which sank a similar proposal last year, and comes just a week before European transport ministers are due to vote on the controversial plan.

The group led by James Oberstar, the influential head of the House transportation committee, questioned what US negotiators had offered to their EU counterparts after successfully blocking earlier efforts to ease the investment restrictions.

The intervention surprised many US airline executives, some of whom had reversed earlier opposition to the first stage of the so-called Open Skies pact. Carriers had felt more confident about securing access to London’s congested Heathrow airport, but had been encouraged by US officials to restrain their relative enthusiasm.

However, some executives played down the impact of the letter sent by the three congressmen to Mary Peters, the US transportation secretary, as it contains no immediate threat to introduce blocking legislation.

One executive said the politicians were motivated by calls last week from airline unions for Congress to intervene and block the EU deal, citing concerns over proposed franchise agreements and so-called seventh freedom rights to fly on from the US to third countries.

”Unions don’t like the franchise arrangement,” said the executive. ”They see it as the camel’s nose under the tent.”

Mr Oberstar and his fellow critics said the draft agreement was “ambiguous” about the potential for changes to legal restrictions on foreign ownership of US-based airlines.

US negotiators sought to circumvent opposition by offering EU investors access to the US domestic market through franchise agreements.

The letter called for reassurances about the implementation of current policy, and said Congress would examine any “case-by-case” review of inward investment to the industry. New legislation could be introduced to enforce the policy requiring “actual control” of US airlines to be in the hands of US investors.

The DoT on Wednesday said that the tentative deal was ”deliberately crafted to strictly adhere to all existing laws, regulations and rules regarding the control and ownership of US airlines”.

However, any further flare-up of political opposition in the US will be closely watched by European officials hoping to take a fragile consensus of support for the pact into next week’s vote.

The potential roadblock comes just a day after the UK – viewed as the principal opponent to the pact among EU members – signaled it was likely to back the first-stage agreement.

Douglas Alexander, transport secretary, warned parliament of ”serious consequences” for the UK if it refused to ratify the liberalised air-services accord.

The disquiet in the UK reflects the importance of Heathrow – which is rich in profitable business traffic. Under the present UK/US treaty only four airlines - British Airways and Virgin Atlantic from the UK and American Airlines and United Airlines from the US - are allowed to fly direct services between Heathrow and the US.

The EU this week said it could suspend a proposed ”open skies” deal with the US if Washington does not open its domestic market by mid-2010.

Jacques Barrot, transport commissioner, who drafted a deal last month, said the US had agreed to further liberalisation in a second stage.

”Some people who don’t like the agreement…say we’ll never get to this second stage because the US would have won out on the first stage. But that’s not right,” he told the European parliament in Strasbourg.

”People are right when they call for a mechanism that will inevitably lead to a second stage and I’ve got that. We’re going to start negotiations for phase two in January next year. If there’s no second-stage agreement between now and mid-2010, we can suspend our side of the deal,” Mr Barrot said.

The FT also reports that plans to launch a European satellite navigation system to rival the US global positioning system have ground to a halt following a break down in relations between governments and private contractors.

Jacques Barrot, the transport commissioner, said on Wednesday he was writing to the eight companies building the Galileo system to discover the reason for more than a year’s delay. “They are just not working,” said his spokesman.

Allegations that Spain isblocking progress until it isguaranteed more jobs and work by the multinational consortium led one critic to brand the project “Airbus in space”. Spain said its companies were merely insisting that the consortium respect a 2005 commitment on the division of work.

EU governments fear that China could launch a competitor before Galileo is airborne. Governments will confront contractors representing the cream of European space industry at a meeting next week. “We will give the companies an ultimatum,” said a French diplomat. “But what will happen if that does not work?”

Industry sources said they doubted work would restart until there was a guarantee it could win business from GPS, the free American military system that sparked the huge market in car navigation devices.

“There is a doubt over the revenues,” said one. “Why sell Pepsi-cola when you can get Coca-Cola free?”

He suggested that governments would have to guarantee that emergency services such as fire and ambulance would pay to use the public signal.

The consortium includes European aerospace company EADS, France’s Thales and Alcatel-Lucent, the UK’s Inmarsat, Italy’s Finmeccanica, AENA and Hispasat of Spain, and a German group led by Deutsche Telekom.

They are balking at sharing development costs, which have doubled from €1bn to €2bn. Relations between them are so bad they have yet to establish a joint head office or appoint a chief executive. The consortium’s spokesman was unavailable for comment on Wednesday.

“In the light of these latest revelations it is looking increasingly like an Airbus in space,” said Gerard Batten, an MEP from the UK Independence party. He said taxpayers would be forced to bail out Galileo and pay for mandatory services such as road pricing to cover its costs.

Spain said its companies were merely insisting that the consortium respect a 2005 commitment on the division of work.

Last week the EU agency running the project had to launch a second satellite to prevent the loss of the crucial public frequency after technical problems aborted an early launch.

There were originally to be 30 satellites in place by 2010 but Mr Barrot’s spokesman said the system would not be operational until 2011, and the timetable was slipping by the day. China recently said its Beidou system would cover China and its neighbours by 2008, and then the rest of the world.

Galileo will be used to monitor natural disasters, in air and sea rescue services and for a range of commercial uses, including possibly road safety and pricing. Satellite services were worth €60bn in 2005 and growing at 25 per cent a year, said the Commission, which is looking for ideas to commercialise it. The developing companies will have a 20 year concession to run it.

The New York Times reports that the most widely prescribed sleeping pills can cause strange behavior like driving and eating while asleep, the Food and Drug Administration said yesterday, announcing that strong new warnings will be placed on the labels of 13 drugs.

The agency also ordered the makers of the well-known drugs Ambien and Lunesta and the producers of 11 other commonly used sleeping pills to create patient fliers explaining how to use them safely.

The fliers, which the agency says it requires when it sees a significant public health concern, will be handed out at pharmacies when consumers fill their prescriptions.

Although the agency says that problems with the drugs are rare, reports of the unusual side effects have grown as use of sleeping pills have increased.

Sales in the United States of Ambien and Lunesta alone last year exceeded $3 billion. Use of those medications and other similar drugs has soared by more than 60 percent since 2000, fueled by television, print and other advertising. Last year, makers of sleeping pills spent more than $600 million on advertising aimed at consumers.

The review was prompted, in part, by queries to the agency from The New York Times last year, after some users of the most widely prescribed drug, Ambien, started complaining online and to their doctors about unusual reactions ranging from fairly benign sleepwalking episodes to hallucinations, violent outbursts, nocturnal binge eating and — most troubling of all — driving while asleep.

Night eaters said they woke up to find Tostitos and Snickers wrappers in their beds, missing food, kitchen counters overflowing with flour from baking sprees, and even lighted stoves.

Sleep-drivers reported frightening episodes in which they recalled going to bed, but woke up to find they had been arrested roadside in their underwear or nightclothes. The agency said that it was not aware of any deaths caused by sleep-driving.

The reports gained credence from scientific studies. A forensic toxicologist in Wisconsin, Laura J. Liddicoat, gave a presentation at a national meeting on six instances of Ambien-impaired driving.

And Dr. Carlos H. Schenck and Dr. Mark W. Mahowald of the University of Minnesota said that they had been studying cases of nearly 30 Ambien users who developed unusual nighttime eating disorders.

Last May in Washington, Rep. Patrick Kennedy, Democrat of Rhode Island, blamed Ambien when he crashed his car near the Capitol building.

The agency also received reports of people making phone calls, purchasing items over the Internet, or having sex under the influence of sleep medication.

In each case the consumers had no recollection of the events, which they said had occurred after they took their pills and headed for bed.

An agency official said yesterday that the activities associated with the drugs went beyond mere sleepwalking.

"We do believe that sleepwalking is different from these behaviors," said Dr. Russell Katz, the F.D.A.'s director for neurology products. "Sleepwalking is considered more of a reflex. These behaviors are complex and they're different fundamentally because of the complexity. People get up, they take their car keys and they go drive. As you might imagine, that might be potentially dangerous to the patient and others as well."

Dr. Katz said that it was not entirely clear whether people reporting the problems had been technically asleep or awake. Although Dr. Katz said the side effects were rare, the agency said that the few dozen reports it had received probably did not represent the full extent of the problem.

Drinking alcohol before or after taking the drugs appears to increase the chances of having such a reaction, Dr. Katz said.

A defense lawyer in Atlanta who specializes in impaired-driving cases, William C. Head, said he had received calls from people around the world who had been charged after using such medications.

"Ninety percent of these cases involve alcohol as well," Mr. Head said. Often, though, the people arrested had only a glass of wine or two, then took a sleeping pill, he said.

"You can't even keep your car on the road," Mr. Head said. "I think any warnings that they give, any advertisements should say not a drop of alcohol."

The medication guides that the agency has called for will clearly explain that risk, according to Dr. Katz, who said the drug makers must submit drafts by May. He said the drug makers had been working with the F.D.A. on the wording since the agency notified the companies three months ago that the changes would occur.

Besides warning against alcohol use, the new labels and guides will tell consumers that they should not take the pills with other drugs that suppress the nervous system.

The warnings labels will include some general language required by the agency, along with language that the companies will be required to draft that describes the side effects of their specific drugs.

The drugs affected include newer products as well as older and widely used ones that are sold under brand names and generic names.

Most of the drugs already carry statements warning against alcohol use and of the risk of hallucinations. Advertising for the drugs has also included such warnings. But the labels will make those statements more prominent, and the medication inserts will emphasize the risks when the consumer gets the prescription filled.

The warnings also are to include information about an unrelated and rare risk of life-threatening allergic reactions with sleep medications. Some patients have recently reported such reactions, in which the air passages or face swells up, after using one of the newest drugs in the group, Rozerem, Dr. Katz said.

After reviewing reports, the agency determined that those reactions were also a potential side effect with other drugs in the group, he said.

Although most of the reports of sleep-driving and sleep-eating have involved Ambien, the agency concluded that the behavior can be caused by any of the sleeping pills.

One sleep expert, Dr. Mahowald of Minnesota, said that Ambien had received the most publicity because it was the most widely used. But "there's no question that any of the sedative hypnotics can do this," he said.

Ambien and its extended-release formula, Ambien CR, made by Sanofi-Aventis, dominated the market last year, accounting for 27.6 million of the 44 million sleep drug prescriptions in this country, according to data from Verispan.

In second place, with about 7.3 million prescriptions, was the drug temazepam, a generic that is also sold by Tyco Healthcare under the brand name Restoril.

Lunesta, by Sepracor, was next with 5.8 million prescriptions.

Dr. Mahowald directs the Minnesota Regional Sleep Disorders Center, where doctors have been involved in a study of about 30 patients who developed sleep-eating while using Ambien. Some of the patients gained weight before discovering that they were getting up at night to cook and eat.

"Hopefully this will make doctors think twice before blindly giving patients a prescription," said Dr. Mahowald, who advocates a combination of medication and behavioral therapy to treat insomnia.

He also criticized marketing of the products. "I personally think the extent of advertising has just been unconscionable," he said.

Data from the research firm TNS Media Intelligence shows that in 2005 and 2006, Sanofi-Aventis spent a total of nearly $350 million to advertise Ambien and Ambien CR.

Sepracor spent more than $500 million on advertising for Lunesta during that same two-year period. And Takeda, which makes Rozerem, spent about $100 million.

After yesterday's F.D.A. announcement, Sanofi-Aventis immediately posted the text of a "Dear Doctor" letter to its Web site, outlining the new warnings. The agency has ordered all the companies to send such advisories to prescribing doctors.

In a statement last night, Sanofi-Aventis said that information about sleepwalking had always been included on its label. In company clinical studies, it occurred in fewer than 1 in 1,000 patients, the statement said.

The agency also said that it was recommending that the drug makers conduct additional clinical studies involving sleep-driving and other reactions to determine whether any of the sleeping pills do not cause those problems. But those studies will not be required. And so far, none of the companies have announced plans to conduct them, Dr. Katz said.

The agency's move follows a warning last month by authorities in Australia, where Ambien is marketed as Stilnox.

The Australian drug agency said that it had received 16 reports of unusual activities by consumers using the product, including sleep-driving and sleep-eating. In one case, a woman woke up with a paintbrush in her hand, discovering she had painted the front door of her home while asleep.

The NYT also reports that an unusual coalition of industrial and developing countries began pushing Wednesday for stringent limits on the world’s most popular refrigerant for air-conditioners, as evidence mounts that the refrigerant harms the earth’s ozone layer and contributes to global warming.

The coalition is pitted against China, which has become the world’s leading manufacturer of air-conditioners that use the refrigerant, HCFC-22. Most window air-conditioners and air-conditioning systems in the United States use this refrigerant, as well.

International pressure has grown rapidly this winter for quick action. “We scientifically have proof: if we accelerate the phaseout of HCFC, we are going to make a great contribution to climate change,” said Romina Picolotti, the chief of Argentina’s environmental secretariat.

An accelerated phaseout of the refrigerant could speed up by five years the healing of the ozone layer of the atmosphere. It could also cut emissions of global-warming gases by the equivalent of at least one-sixth of the reductions called for under the Kyoto Protocol.

The United States joined Argentina, Brazil, Iceland, Mauritania and Norway on Wednesday in notifying the Ozone Secretariat of the United Nations Environment Program that they want to negotiate an accelerated phaseout of hydrochlorofluorocarbons, or HCFC’s, at an international conference in Montreal in September.

The conference is tied to the 20th anniversary of the signing of the Montreal Protocol, which has reduced emissions of most ozone-depleting gases but left a loophole for HCFC-22 production by developing countries. China has repeatedly said it will honor all current rules of the Montreal Protocol but does not want to add new ones.

Recent studies have shown that steeply rising production of HCFC-22 by China, India and other developing countries has slowed the healing of the ozone layer, which protects humans, animals and vegetation from the sun’s dangerous ultraviolet rays.

A report last week by five American and European scientists found that sharp cutbacks in emissions of ozone-depleting gases since 1987 have been far more effective in combating global warming than the Kyoto Protocol, the 1997 agreement that was aimed directly at limiting climate change.

HCFC’s and other ozone-depleting gases are extremely powerful warming gases. Gram for gram, the ones used as refrigerants have thousands of times the global-warming effect of carbon dioxide. The ozone-depleting gases are released in far smaller quantities, though, than carbon dioxide, which is emitted when fossil fuels are burned by vehicle engines, power plants and other users.

The report by the European and American experts, published last week in the Proceedings of the National Academy of Sciences, found that the Montreal Protocol had proved to be 5.5 times as effective as the Kyoto accord was intended to be in cutting emissions of global-warming gases. The Montreal agreement has been in force much longer and applies to developing and industrial nations alike, while the Kyoto Protocol has binding limits only for industrial nations.

The report has caught the attention of countries in the Pacific and Indian Oceans that fear that global warming will lead to a rise in sea levels and a significant loss of their limited land.

“As small island nations, our main concern is that whatever touches the climate has to be dealt with fairly quickly,” said Sateeaved Seebaluck, permanent secretary in the environment ministry of Mauritius, an island nation well east of Africa in the Indian Ocean.

Mr. Seebaluck said that a flurry of news reports about HCFC-22 this winter had been widely e-mailed among specialists and had led to greatly increased international interest in addressing the problem.

The Montreal Protocol currently allows developing countries to keep increasing their production of HCFC-22 until 2016, and then freezes production at that level until 2040, when it is supposed to be halted. But that schedule was devised in the early 1990s, when HCFC-22 was used mainly in industrial nations; developing countries were seen as too poor ever to afford much of the chemical.

The Kyoto Protocol then exempted HCFC-22 and other ozone-depleting substances from production and consumption limits on the grounds that the Montreal agreement had already addressed those matters.

Use of HCFC-22 has soared in the third world with the economic growth of China, India and other countries, along with the sharp drop in air-conditioner costs that has accompanied China’s growing skill in making them cheaply. Mr. Seebaluck said Mauritius’s use of HCFC-22 had risen more than 100-fold in the last six years because of a boom in hotel construction and the rapid expansion of the fishing industry, which uses a lot of refrigeration to preserve freshness.

The use in India and China, far larger markets, has been rising as much as 35 percent a year lately, with specialists predicting that similar growth could last through 2016.

Industrial nations are required to phase out HCFC-22 by 2020, but most are moving faster. The European Union phased it out in 2004. The United States will ban domestic production in 2010 and is considering whether to ban imports then, as well.

China has begun making air-conditioners with more modern refrigerants for the European market. But by continuing to produce HCFC-22 for markets elsewhere, the Chinese have been able to claim hundreds of millions of dollars a year in payments from an obscure United Nations agency.

The payments are to compensate Chinese chemical factories for incinerating a waste gas generated as part of the manufacturing process for HCFC-22. If the Chinese industry switches to modern refrigerants, it would no longer produce the waste gas and so would lose the credits.

India has a large and growing HCFC-22 industry that is also reaping a fortune in credits. But the Indian government has largely stayed on the sidelines in international talks, while China has called for industrial nations to pay even more for the incineration of waste gases from HCFC-22 production; China proposes to spend much of that to develop its renewable-energy industry.

A big problem is that no one has agreed what should replace HCFC-22. The chemicals requiring the fewest changes to air-conditioner designs avoid harm to the ozone layer but are still as potent, gram for gram, in terms of global warming.

Mack McFarland, chief atmospheric scientist at DuPont, which favors an accelerated phaseout of HCFC-22, said the company had developed a chemical that also has little effect on global warming. But the chemical is suitable only for vehicle air-conditioners, not the building air-conditioners that now rely on HCFC-22.

Environmentalists contend that chemical companies and air-conditioner makers are too slow to embrace other refrigerants, like ammonia or carbon dioxide, that may pose technical challenges but could be better for the ozone layer and global warming.

“Industry certainly is somewhat concerned about some of those chemicals because some of them don’t promise a lot of profits,” said Alexander von Bismarck, campaigns director of the Environmental Investigation Agency, a Washington advocacy group.

David Doniger, climate policy director at the Natural Resources Defense Council, said that even switching to new commercial refrigerants that are potent global-warming agents could help the environment. Air-conditioners designed for the new refrigerants tend to be more energy-efficient and often do not use as much refrigerant, he said.