Business news with words aircraft+department+foreign. 2 news.

A controversial scheme for American aid to help its southern neighbour fight drugs looks useful but underwhelming THE idea was first mooted at a meeting near Merida last March between Mexico's president, Felipe Calderon, and George Bush. Months of negotiations culminated in weeks of leaks, mainly from American officials. But for such a well-rehearsed exercise, the announcement when it finally came was oddly low-key. On October 22nd both governments said that in an early-morning telephone call the two presidents had agreed on a plan under which the United States will provide Mexico with $1.4 billion in aid over the next three years to fight drug traffickers. Patricia Espinosa, Mexico's foreign minister, said the largest single chunk of an initial $500m would be spent on aircraft--mostly transport planes, she said, although in Washington, the State Department talked of surveillance aircraft and helicopters. There will also be scanning equipment at the border, and new communications systems, training and technical advice for Mexican police, including help on a witness-protection programme. And the United States will also give $50m in anti-drug aid to the Central American countries.

THE US trade deficit narrowed more than forecast in August as exports climbed to a record for a sixth consecutive month. The gap shrank 2.4 percent to US$57.6 billion, the smallest since January, from a revised US$59 billion in July, the Commerce Department said yesterday in Washington. Foreign companies, benefiting from growing demand and a weaker dollar that's made American goods less expensive, have been snapping up Boeing Co aircraft and General Electric Co turbines. Rising exports will help keep the economy from falling into recession even as the housing slump persists. "The dollar is continuing to decline, which is giving a huge boost to competitiveness," Nigel Gault, chief US economist at Global Insight Inc in Lexington, Massachusetts, said before the report. Economists had forecast the deficit would narrow to US$59 billion, from a previously reported US$59.2 billion in July, according to the median of 74 forecasts in a Bloomberg News survey. Prices of goods