This proposal has angered the Swedish government

Valdis Dombrovskis said his coalition would meet on Monday to look at ways to extend the 325m lats ($677.5m; £423m) of cuts already agreed for 2010.
Latvia is under pressure to increase cuts for next year to 500m lats.
This is the level it agreed with the EU in exchange for 7.5bn euros ($11bn;£6.9bn) of emergency loans.
The country needed this financial support, which also includes contributions from the International Monetary Union and the Swedish government, because it has been hit hard by the global recession.
Its economy contracted at an annual rate of 18.7% from April to June, while its unemployment rate soared in August to 18.3%, the highest in the European Union after Spain.
'On track'
ANALYSIS
By Mark Sanders, Europe business correspondent
Latvia's economy is one of the sickest in Europe.
Its government is having to make deep cuts to public spending in order to qualify for international aid. Public services like the health care system are already being squeezed.
But under pressure, the government will meet next week to discuss further cuts. That's likely to mean more pain for many in Latvia.
There have already been disturbances in the country which brought down the previous government. And with the economic crisis weighing down so heavily on its people, the current government knows there could be a political price to pay.
"We are working on additional measures... so that we reach agreement with international loan providers," said Mr Dombrovskis.
"We are on track to meet our budget deficit target both this and next year."
He said the deficit would fall to 10% this year, and 8.5% in 2010.
Monday's cabinet meeting comes a day before the EU's European Monetary and Economic Affairs Commissioner Joaquin Almunia's is due to visit Riga to discuss the continuing impasse.
Mr Dombrovskis had earlier told BBC World that the worst of Latvia's recession is now over, and ruled out devaluing the currency.
Monday's meeting is also due to discuss the prime minister's controversial proposal that Latvian homeowners behind on their mortgages should only be liable for the value of their property rather than the level of their outstanding loan.
This proposal has angered the Swedish government, whose banks dominate the sector in Latvia.
While Mr Dombrovskis admitted that there remained "difficulties to overcome", he said the Latvian economy was now "stabilising".

More protection

Mr Obama said it was more important than ever to have a new consumer watchdog, and accused vested interests of trying to scupper reform.
He accused the US Chamber of Commerce of trying to "kill" plans for the Consumer Financial Protection Agency.
The president was talking on the day he received the Nobel Peace Prize.
More protection
His administration has proposed a number of regulatory reforms designed to prevent another financial crisis.
One of them is to create a new consumer agency to regulate products such as credit cards and mortgages.
It would also force banks to offer low-risk, standard versions of these products.
"Predictably, a lot of banks and big financial firms don't like the idea of a consumer agency very much," Mr Obama said.
"They're doing what they always do - using every bit of influence to maintain the status quo that has maximised their profits at the expense of American consumers.
"In fact, the US Chamber of Commerce is spending millions on an ad campaign to kill it."
But the president said he would not back down from his plans for reform. He said the new agency was needed to protect US consumers from "ridiculously confusing contracts" used by financial institutions.
"We have already seen and lived the consequences of what happens when there is too little accountability on Wall Street and too little protection on Main Street, and I will not allow this country to go back there," he said.
The White House also wants to give the central bank, the Federal Reserve, new powers over big financial firms, including the ability to seize banks whose collapse could threaten the economy.

Nigeria depends heavily on oil exports

The fund was set up as a way to protect Nigeria's economy from unpredictable movements in the oil price.
The Nigerian government says it will take money from the fund for an economic stimulus package.
Economists fear the move will leave the country vulnerable if recovery in the global economy suffers a setback.
Spending fears
The government wants to tap into the fund, which currently holds about $9bn, to stimulate the economy.
Nigeria depends heavily on oil exports, and the savings fund is there to shelter the economy if the oil price falls.
But there is criticism over how it plans to spend the money.
Economic stimulus packages in other countries have targeted infrastructure projects, job creation, and tax cuts for small businesses.
Nigeria's government says it will spend half the cash on clearing the debts of federal government contractors.
The rest of the money is to be handed out to local government - to states and local authorities. Many of them have records of serious corruption and financial mismanagement.
Economists - even some advising the government - are warning that the plan is not focussed enough to make an impact.

Many agree that the US economy is now recovering

The Institute of Supply Management (ISM) said the sector, which accounts for 80% of the US economy, increased and the jobs situation improved.
Separate data showed that the US jobs market strengthened last month for the first time since January 2008.
The data boosted US markets with the Dow Jones index rising 1.2%. The Nasdaq and the S&P 500 also saw gains.
Many agree that the US economy is now recovering, but there are mixed signals about the strength of the upturn.
Markets boost
The service index rose to 50.9 last month, from 48.4 in the previous month, the first increase since August 2008, ISM said.
Any figure above 50 indicates growth, while a reading below 50 signals a contraction in the sector. Analysts had expected a reading of exactly 50.
The ISM also said service-sector employment contracted at a slower pace than in August.
The data gave investors confidence, and the Dow closed 112 points higher at 9,599.75, while the Nasdaq rose 1% and the S&P 500 gained 1.5%.
European markets had also rallied earlier, with leading share indexes in London, Paris and Frankfurt all closing higher.
'Reluctant'
The data comes after the Labor Department said on Friday that the US economy lost 263,000 jobs in September, more than had been expected, taking the jobless rate to a fresh 26-year high.
Job creation tends to lag behind any recovery in the economy.
"Businesses are more reluctant than in the past to start the hiring process," said Bank of America economist Ethan Harris. "We won't likely see increased hiring until January."
The US Conference Board said its employment trends index edged up to 88.5 from an upwardly-revised 88.2 in August.
But the index is now down 15.6 percent from one year ago, it said.

Weakness of the dollar

WHY HAVE GOLD PRICES REACHED SUCH HIGHS?
There are several factors at play which are leading to demand for gold rising, pushing up the price:
Weakness of the dollar: The greenback is commonly seen as the World's reserve currency. Low interest rates and the US government's massive economic support package have weakened the dollar.
Those who would typically have invested in that currency are looking for other places to put their money where it will, they hope, gain value.
Speculation: A lot of the investment into gold is coming from institutions such as hedge funds - whose money needs to go somewhere.
When banks are offering very low rates of interest on savings - and money can be borrowed extremely cheaply - gold becomes attractive, observers say.
Inflation risk: Gold is seen as a hedge against inflation. Right now, inflation is pretty low, but mounting worries about potential inflation in 2010 may be enticing more investors to the precious metal.
Psychological: Gold has a "primeval" quality argues Adrian Ash of UK online gold exchange, BullionVault.com (which makes its money when customers buy and sell gold).
He says that while it is essentially a "lump of metal with little purpose", gold tends to hold its value over the long term and is not anchored to the value of cash.
This means that people are drawn to it in uncertain times, Mr Ash adds, though he cautions the price can be volatile.
Seasonal: In Western cultures, individuals buying into gold as an investment remains relatively rare. It is not the kind of advice you are likely to get from a financial adviser, for example.
However, in countries such as China and India, buying gold as in investment is more common. And at this time of year, in the run-up to the Diwali festival, there is a seasonal increase in gold purchases because the metal is traditionally given as a gift.
Indian farmers are also big gold customers at this time of year - seeing it as a way of keep their profits safe after harvest - free from threat of currency fluctuations.
DOES THE PRICE OF GOLD REALLY MATTER?
The reality for most people is that their main contact with Gold is when Spandau Ballet gets played on the radio.
Arguably its biggest role is as a sentiment barometer. A high gold price is an indicator that all is not well with the global economy.
It could be bad news if you are looking for an engagement ring or another piece of jewellery. Higher prices are likely to be passed on to shoppers.
On the other hand, it could be good news if you have gold that you no longer want and could do with making some money.
The rising price has seen an explosion in "scrap gold dealing" - where High Street shops and postal companies will offer to turn the gold into cash.

Weakest of the major currencies last week

The Australian dollar was the weakest of the major currencies last week, and a bearish engulfing candle on the daily AUDUSD charts on October 1 suggests further declines could be in store. Since the Australian dollar still tends to move with other risky assets, traders should look for any fallout from the release of the G7 statement over the weekend. Though the statements don’t usually signal any sort of groundbreaking new biases, there are lingering concerns that there may be a more pronounced focus on currencies, and more specifically, US dollar weakness. Such a move would likely lead the US dollar higher, and thus, AUDUSD lower, on speculation of a coordinated intervention effort. Later in the week, the Australian dollar is going to encounter two of its most market-moving reports: a rate decision from the Reserve Bank of Australia and the net employment change.
On Tuesday, the Reserve Bank of Australia (RBA) is anticipated to leave their cash rate target unchanged for the sixth straight month at 3.00 percent, and the Australian dollar may only respond to a change in the bias of RBA Governor Glenn Stevens’ monetary policy statement. As it stands, Credit Suisse Overnight Index Swaps (OIS) are pricing in a 22 percent chance of a 25 basis point rate hike during this upcoming meeting, and 175 basis points worth of hikes over the next 12 months, which is generally in line with what we’ve seen since early August. It was actually in early July when the RBA’s bias shifted from dovish to neutral, as Stevens removed a line from his statement noting that “scope remains for some further easing of monetary policy.” As long as we see these RBA statements continue to provide progressively optimistic outlooks, the markets are likely to remain in favor of large rate increases over the next year. However, if the RBA starts to signal a more cautious tone, this sentiment could shift very quickly and lead the Australian dollar lower.
On Wednesday, the net employment change for the nation is anticipated to fall for a second straight month, this time by 10,000. As a result, the Australian unemployment rate is projected to edge up to a 6-year high of 6.0 percent from 5.8 percent, but this isn’t so bad when compared with other regions like the US, the UK, and the Euro-zone where unemployment has reached 26-year, 12-year, and 10-year highs. Regardless, the net employment change is similar to the US non-farm payrolls report in that the results are notoriously difficult to predict and thus, prone to providing “surprising” news that can trigger volatile moves in the Australian dollar.

Fermi chip is being billed as a supercomputing chip

Nvidia's new Fermi chip is being billed as a supercomputing chip but Nvidia doesn't want you to forget that it is also aimed at Apple's Snow Leopard and Windows 7.
The Fermi chip was announced with much fanfare on Wednesday as key silicon in a future supercomputer from Oak Ridge National Laboratory. But, wait, Fermi is also going to be great at accelerating stuff in Snow Leopard and Windows 7--not to mention a great gaming chip, according to Bill Dally, chief scientist at Nvidia who spoke during a conference call with analysts on Thursday.
The Fermi graphics processing unit (GPU)--which packs 512 processing cores--will support DirectX-11, a technology for speeding certain multimedia software in Windows 7, and also support an analogous technology in Snow Leopard, OpenCL.
"A lot of (the chip's new) features accelerate key consumer applications. Both Snow Leopard and Windows 7 enable the GPU to be used as a co-processor to accelerate third-party applications," Dally said. With a "discrete (standalone) GPU they can get very good performance on these applications," he said.

Applications that Nvidia says will be accelerated by the Fermi chip(Credit: Nvidia)
Dally gave examples (see graphic) of consumer titles such as Adobe's Creative Suite, Motion DSP's vReveal (for fixing photographs), and Badaboom (for creating iPod video).
He offered a qualifier, however. "We are paying a bit of a compute tax in that we launched a part where a lot of the consumer compute applications haven't really taken hold yet. But over time as more consumer computer applications are developed that take advantage of our compute (consumer) features...I think it's going to give us a big leg up," he said.
And being an Nvidia chip, games are a big target market. "Fermi adds value to games by doing exactly the same kind of scientific simulations that we use to predict climate and to understand the genome and other things," according to Dally. "A great example of that is our PhysX package that basically does physical simulations to make games appear more real."
He also explained why the chip was billed as a supercomputer chip initially and not a gaming chip. "It's a zero-sum game. You have a certain amount of die (chip) area, a certain power budget. It is the case that we put a bunch of die area into double-precision floating point, a bunch of die area into ECC. And for gaming graphics applications, those give less returns than they do for the scientific applications," he said. Double-precision floating point operations are used heavily in scientific computing. ECC, or error correcting code, is a technology that can correct data errors on the fly.
And Dally explained how Fermi can be scaled down to lower-end chips used in the gaming and consumer segments. "We're not talking about other (chips) at this point in time but you can imagine that we can scale this part by having fewer than the 512 cores and by having these cores have fewer of the features, for example less double-precision," he said.
All the Fermi products, including gaming and professional workstation chips, will be announced "pretty close together." Chips are expected sometime in the coming few months.
And how does Fermi stack up against current public information about Intel's future "Larrabee" graphics chip? "We can't compare anything to Larrabee until it shows up and can actually be measured," said Jon Peddie, president of Jon Peddie Research, which tracks the graphics chip market. "But remember, Larrabee was started over two years ago and both ATI and Nvidia have had two new designs out since then," he said. "So the pressure will be on Intel to chase fast-moving ATI and Nvidia," Peddie said. ATI, which is Advanced Micro Devices' graphics chip unit, already has a chip in stores--the Radeon HD 5800-- that supports Windows DirectX-11.

There's a new reality in laptop pricing

Call it the Netbook halo effect: small and cheap is infectious. A quick peek at the lineups of new laptops slated for an October 22 roll-out from Hewlett-Packard and Toshiba make it clear that the prices of mainstream and higher-end laptops are diving, even as the technology gets better.

HP ProBook 5310m starts at $699: this class of business laptop used to start at well over $1,000(Credit: Hewlett-Packard)
"There's a new reality in laptop pricing," said Bob O'Donnell, an analyst at market-researcher IDC. "It's getting harder and harder to sell anything over $800." O'Donnell cited a data point that showed the average selling price of notebooks falling below desktops briefly in retail. "That may have been an anomaly, but the fact that's it's even close is indicative of this phenomenon."
That said, let's start with HP, the world's largest PC supplier. Svelte, well-built business laptops have historically been priced at a premium--starting at more than $1,000. Not anymore. On October 22, HP will begin selling the 13-inch ProBook 5310m that is about 0.9 inches thin, less than four pounds, and clad in an aluminum display enclosure and a magnesium alloy bottom case for $699.
That's about $800 less than the HP EliteBook 2530p business notebook series introduced in August of last year (that started at about $1,500). The 5310m is priced at $699 with an Intel Celeron dual-core processor and $899 with Intel Core 2 Duo chip. Both come with the Windows 7 operating system.
That's what I call a sea change in pricing.
But it gets better. Then there's the 4-pound HP Pavilion dm3 notebook that starts at $549 (no, it's not a Netbook) and will likely range up to about $700 in price for a reasonable memory and hard drive configuration. The 13-inch laptop comes with power-efficient Intel Core 2 Duo or AMD Neo dual-core processors and a standard 6-cell battery that delivers--so HP claims--up to 10 hours of battery life.
I was able to play with a dm3 at a function sponsored by Advanced Micro Devices recently in San Francisco. My immediate impression was that this was a light but solid design.
The Apple $999 MacBook is suddenly starting to look pretty pricey and a little on the thick and heavy side. (Though, according to reports, this may be about to change.)
Let's move on to Toshiba (speaking of sea changes). Toshiba has been known (along with Sony) for offering impressive but stratospherically priced ultraportable laptops. One of the most egregious examples is the 12-inch Portege R600, which starts at $2,099 and jumps quickly (by adding a solid-state drive) to more than $3,000.
That price almost seems laughable these days. Yes, the R600 comes with an integrated optical drive, powerful Core 2 Duo processors, and some other bells and whistles, but that will be an increasingly tough sell against Toshiba's new Satellite T100 Series that is also small, light, and relatively powerful but lops about $1,500 off the price of the cheapest R600.

Toshiba Portege R600--$2,000-plus executive laptops: an endangered species?(Credit: Toshiba)
To wit: the 11.6-inch Satellite T115 starts at $449, packs a dual-core Pentium SU4100 processor, claims up to nine hours of battery life, and weighs only 3.5 pounds. That makes the R600 and other "executive jewelry"--as Intel's CEO Paul Otellini likes to call these laptops--history. And the T115 may even give Toshiba Netbooks a run for their money. (Why settle for a single-core Netbook when you can get a dual-core laptop for $100 more.)
Dell, oddly, is going in both price directions. First, let's look at the Dell we know: a purveyor of inexpensive laptops such as the $449 Inspiron 14 replete with a 14-inch screen, dual-core Pentium, optical drive, 2GB of memory, and a 160GB hard disk drive.
And Dell has plenty of other inexpensive configurations, lending its considerable weight to the downward price pressure on laptops.
Then there's the Dell few people know. The reborn merchandiser of pricey executive laptops like the impressively sleek $2,299 Adamo or the equally stunning Latitude Z starting at $1,800. And then there's the ultra, ultra-thin Adamo concept. This certainly will not be cheap either (if it, in fact, appears).
Time will only tell how well this Beverly Hills boutique strategy holds up in the face of an onslaught of thin, attractive, and cheap laptops. Of course, there will always be room for a few Cadillac XLR-V roadsters and Ferraris at the top if the designs are compelling enough. (To be honest, I'm anxious to see how groundbreaking the new Adamo design is.)
Meanwhile, the future of laptops lies somewhere below $800. I can live with that.

Become the world's "premier" decision-making forum

"One of the legacies of this crisis may be a recognition of changed economic power relations," said World Bank president Robert Zoellick.
The US, the world's biggest economy, has been in recession for almost two years, while emerging economies like China and Brazil have grown.
This may help bring about a long-term rebalancing of the world economy.
'Changed relations'
"A multi-polar economy less reliant on the US consumer will be a more stable world economy," Mr Zoellick said.
He was speaking in Istanbul before meetings of the the World Bank and International Monetary Fund (IMF), where there is some discussion about how to reorganise the leadership of the bodies so that they better reflect the diversified world.
For example, China recently got a permanent chair on the IMF's 24-seat policy-making committee.
G7 or G20?
Finance ministers from the Group of Seven (G7) richest nations - the US, Japan, Germany, UK, France, Canada and Italy - have also been meeting in Istanbul.
The G7 said the world economy was improving but "there is no room for complacency since the prospects for growth remain fragile and labour market conditions are not yet improving."
Unemployment in the US on Friday surged to a new 26-year high of 9.8%.
G7 finance ministers agreed to keep stimulus spending in place "until recovery is assured".
US Treasury Secretary Timothy Geithner said the US economy had "improved dramatically" but that "conditions for a sustained recovery, led by private demand, are not yet fully established".
Mr Geithner also said the world is recovering "sooner and stronger" than expected.
Questions have also been raised about the future of the G7.
The Group of 20 - consisting of the largest economies including China, India, Russia and Brazil - appears to have replaced it over the past year.
The G20 leaders said after their meeting in Pittsburgh last month that it will become the world's "premier" decision-making forum.

Even the UK is resisting immediate pressures

The world financial crisis has made it clear that, although we have a globalised world economy, there is no clear way governments can work together to solve global economic problems.
But the lack of co-ordination, both now and in the future, could mean a deeper and longer global recession with more unemployment and poverty around the world.
The G20, an ad-hoc grouping of the world's major economies, has stepped in and performed a major role during the past year.
But the crisis has also spurred efforts to reform the existing global financial institutions, the World Bank and the International Monetary Fund (IMF), which were set up at the end of World War II to help revive the battered global economy and whose job it is to lend to countries in trouble.
Out of date
Countries contribute funds to the IMF according to the size of their economies, and they then receive voting rights based on their contributions.

April's G20 Summit agreed greater funding for the IMF and World Bank
But the current voting structure does not reflect the rise of powerful new economies like China and India, which are leading the world out of recession even while growth collapses in Europe and the US.
And a row has broken out between the US and China on the one hand, and Europe on the other, over how much voting rights should be changed.
Although all sides have pledged to come up with solutions by January 2011, there are significant practical problems.
European countries, which make up 25% of the world economy, hold 40% of the votes. The US, which makes up another 25% of the world economy, only holds 17% of the voting rights.
But under IMF rules, all major decisions require a majority of 85%, making the US the only individual country that can block any decision.
The US and China have proposed that European countries give up 5% to 7% of their quota in order to provide more votes to the emerging economies.
But smaller European countries, such as the Netherlands and Sweden, are reluctant to give up their seats on the 24-member IMF board.
Even the UK is resisting immediate pressures for reform. A UK Treasury official told the BBC that, as Europe had made the biggest contribution to renewing IMF funds (lending over $150bn of the $500bn asked for), now was not the time to ask it to reduce its authority.
Changing China
Strengthening the role of China and India in the newly emerging system of international economic governance is going to be essential if they are to play their proper role in the world economic system
G20 PITTSBURGH SUMMIT
Leaders of the world's biggest economies will gather in Pittsburgh on Thursday and Friday for the latest G20 meeting in the wake of the global financial crisis
Our Q&A explains what to expect
See whether they are fulfilling the pledges made at the last meeting in London
This time they will be deciding what limits should be put on bankers' bonuses
And debating who should run the global economy
For full coverage of the G20 and the global recession go to our in-depth guide
Most economists doubt that the US and Europe can return to their role as the consumers of last resort for the rest of the world, fuelled by lots of debt, believing they will have to grow in future by increasing their exports.
That would mean China would have to reduce its exports as a proportion of its economy and shift towards greater domestic consumption - a tall order.
This would go a long way to solving one of the fundamental causes of the current economic crisis - the growing global imbalance between China as an exporter with a trade surplus, and the US as the world's biggest consumer, living on borrowed money.
The US is no longer able to play this role, and the sooner China turns to domestic consumption, the more likely it is the US can grow by producing more for export, rather than consuming more and increasing its debts.
So giving China a bigger role in the IMF may encourage those within China who want to shift its priorities in a way that would help the world economy to grow.
Reform and revive
Reform is all the more important given the new powers and resources the IMF and the World Bank were given at the London summit.

Developed nations are resisting calls to give up some of their influence
The World Bank lends long-term funds to developing countries to help them build infrastructure such as dams and roads and to improve their health and education systems.
The IMF - which gives short-term support to countries facing financial hardship - was given vastly expanded resources to deal with the crisis.
Countries pledged an extra $500bn (£300bn) in loans, and $250bn in Special Drawing Rights, a currency facility which countries can draw on without restrictions.
The IMF was also given more authority to monitor the world economic situation and report to the G20 leaders.
In return, the IMF pledged to moderate the often harsh conditions attached to its loans - a practice that has frequently attracted complaints from developing countries in the past.
With hopeful signs in the global economy, at least compared to six months ago in London, this week's meeting could determine whether the G20 emerges as the key organisation with influence over how the world economy is run, or whether it will disappear into insignificance when the immediate crisis is over.

Durable goods orders had their steepest drop

WASHINGTON (Reuters) -- New orders received by U.S. factories posted their first drop in five months in August, government data showed on Friday, going against Wall Street expectations that they would rise.
Orders fell 0.8% after rising 1.4% in July, which was originally reported as a 1.3% increase, according to the Commerce Department. Analysts polled by Reuters were expecting them to gain by 0.3%. The drop was the first since March, when they fell 1.9%.
Factory orders were also down when compared to August 2008, by 22.5%.
Unfilled orders dropped 0.4% in August. They have now fallen for 11 months in a row, which is the longest streak of consecutive monthly decreases on records dating to 1992, the Commerce Department said.
Inventories fell 0.8%. They have decreased for 12 months in a row, the longest streak since 2002.
Durable goods orders had their steepest drop, of 2.6%, since January, when they fell 7.8%. Orders of durable goods -- big ticket items meant to last -- were originally reported as declining 2.4% in August.

UK science against that of 25 other countries

The International Benchmarking Study of UK Research Performance 2009 put UK scientists second only to the US in their share of journal citations.
The survey, by the independent company Evidence UK, used data from 8,000 scientific journals in 85 languages.
It compared UK science against that of 25 other countries, including the G8.
This was the sixth annual benchmarking survey commissioned by the UK government.
It looked at 40 separate scientific indicators and revealed that the UK ranks first among G8 nations on the ratio of citations to public spending.
Real strength
The minister for science and innovation, Lord Drayson, told BBC News that the report reflected the UK's focus on quality rather than quantity.
"This is an opportunity for us to pat ourselves on the back as a nation. It is no coincidence that Cambridge University, for example, has had more Nobel Prize winners than any other institution on the planet.
"It reflects the real strength that we have here in the UK. We've got to make sure that we maintain it."
The study found that the UK produced 91,723 scientific papers - just under 8% of the world's total, and third only to the US and China.
In the last year UK scientists also had an almost 12% share of citations in science journals across the world, and increased their share of the most cited papers by 1% to 14.4%.
The survey also revealed a rise in the number of papers co-authored with researchers in other countries, which tend to be cited more frequently than papers authored solely by UK academics.
It also highlights a four-fold increase in the number of papers produced by China over the past decade.
China now produces more scientific papers than the UK but they are cited less frequently by other scientists.
The UK is particularly strong in clinical, health, biological and environmental sciences.
Overall, UK scientists produce a quarter of the papers by EU researchers.

It reflects the real strength that we have here in the UK

The International Benchmarking Study of UK Research Performance 2009 put UK scientists second only to the US in their share of journal citations.
The survey, by the independent company Evidence UK, used data from 8,000 scientific journals in 85 languages.
It compared UK science against that of 25 other countries, including the G8.
This was the sixth annual benchmarking survey commissioned by the UK government.
It looked at 40 separate scientific indicators and revealed that the UK ranks first among G8 nations on the ratio of citations to public spending.
Real strength
The minister for science and innovation, Lord Drayson, told BBC News that the report reflected the UK's focus on quality rather than quantity.
"This is an opportunity for us to pat ourselves on the back as a nation. It is no coincidence that Cambridge University, for example, has had more Nobel Prize winners than any other institution on the planet.
"It reflects the real strength that we have here in the UK. We've got to make sure that we maintain it."
The study found that the UK produced 91,723 scientific papers - just under 8% of the world's total, and third only to the US and China.
In the last year UK scientists also had an almost 12% share of citations in science journals across the world, and increased their share of the most cited papers by 1% to 14.4%.
The survey also revealed a rise in the number of papers co-authored with researchers in other countries, which tend to be cited more frequently than papers authored solely by UK academics.
It also highlights a four-fold increase in the number of papers produced by China over the past decade.
China now produces more scientific papers than the UK but they are cited less frequently by other scientists.
The UK is particularly strong in clinical, health, biological and environmental sciences.
Overall, UK scientists produce a quarter of the papers by EU researchers.

Significant and lasting benefits

It has recommended a "competition test" to prevent firms with a strong presence in an area from building new stores or making major extensions to its outlets.
However, small extensions will be allowed in some circumstances after the watchdog reviewed its plans.
Consumers would still see "significant and lasting benefits", it said.
"We expect that the competition test will have the effect we intend by helping to bring in competition where it is lacking and to stop individual retailers consolidating strong positions in local areas to the detriment of consumers," said the commission's chairman, Peter Freeman.
Extensions
The grocery sector was referred to the Competition Commission in May 2006 amid concerns major retailers were too powerful in some areas.
Tesco, the UK's biggest supermarket chain, challenged the introduction of the competition test earlier this year.
The Competition Appeals Tribunal said the test was not wrong. However, it ordered the watchdog to do more assessment of the economic impact and effectiveness of the test - resulting in the watchdog modifying the details of the requirements.
Under the proposals, retailers will now be able to make small extensions to stores - provided they are no more than 300 sq metres of groceries sales area and have not been modified in the previous five years.
The commission said it believed "that this modification will not significantly reduce the effectiveness of the test but will recognise the fact that such small extensions, if prevented by the test, would be less likely to prompt a rival development".
Rules
Under the test, the Office of Fair Trading will advise UK planning authorities on the potential impact of any new development.
The retailer will pass the test if they are new to the area, or if four or more different supermarkets are within a 10-minute drive of the proposed site.
And where there are three or fewer grocers in the area, the application will be given the green light so long as it does not then account for more than 60% of total retail space.
Tesco said that the commission had made the "wrong recommendation" and the test would act as a "brake on growth" for the industry.
"The government should think very carefully before proceeding with this recommendation and intervening aggressively in what is acknowledged to be a highly competitive industry and deterring investment in these difficult economic times," said corporate and legal affairs director Lucy Neville-Rolfe.

Flights have been disrupted

The company says that a significant number of flights have been disrupted after pilots reported sick for a fourth consecutive day as part of a protest.
The pilots are protesting against the cancellation of performance-related bonuses by the cash-strapped airline.
Talks between pilots and management failed to reach a solution on Monday.
The BBC's Sanjoy Majumder in Delhi says that the Indian aviation industry has been hit hard by the global economic turndown with increased costs of operation and travellers opting for low-cost airlines or train services.
Earlier this month a protest by pilots for India's privately-owned Jet Airways caused considerable disruption.
During that protest hundreds of passengers were stranded at various airports, leading to angry confrontations.
Air India said that the pilots' refusal to accept their decision to slash bonuses and incentives by up to 50% were "unacceptable".
So far the management has held firm saying they need to cut costs since Air India is facing huge losses because of the worldwide recession.
Air India is state owned and the government is now intervening to try and end the crisis. The airline posted losses of more than $800m in 2008-09 and has asked the government for a financial bail-out.
But it also said that it was keeping options open. As well as cancelling many flights, the airline has suspended bookings for flights in the next fortnight.
The struggling airline had to delay by a fortnight payment of June salaries and incentives to its 31,500 employees.
The protest comes as airlines around the world try to cope with declining passenger traffic due to the global slowdown.

Japanese jobless rate to rise again

But the number of people unemployed hit a six-year high of 3.61 million in August, a figure which was up 32.7% on the same month of 2008.
Official figures also showed that household spending rose 2.6% in August from a year earlier.
Also on Friday, US figures for September showed 263,000 jobs had been lost, taking the jobless rate to 9.8%.
'Worst levels'
Analysts had been expecting the Japanese jobless rate to rise again in August.
"The unemployment rate fell earlier than expected, but we don't know yet whether it is just a dip for one month or something more continuous," said Masamichi Adachi, senior economist at JPMorgan Securities.
The quarterly Tankan survey of business confidence on Thursday had indicated that companies were feeling better than they had three months before, but that they still felt they had too much capacity and too many workers.
The number of workers employed in manufacturing fell almost 10% year on year, but the number employed in the care and hospitality sectors rose.
There was a cautious response to the figures from the government.
"The figures may give the impression that the situation has improved a bit," said Labour Minister Akira Nagatsuma.
"However, it continued to be around the worst levels in the post-war period."

Crude oil futures

The Labor Department said the US economy lost 263,000 jobs in September, which was more than had been expected.
That caused crude oil futures to drop 2.6%, or $1.81, to $69.01 a barrel. Brent crude, traded in London, also shed $1.82 to $67.37.
US stocks and the dollar also fell, as investors had cause to reconsider hopes for a quick economic recovery.
'Glacial'
The figures for the months of July and August were also revised higher, showing 13,000 more jobs lost than previously reported.
The jobless rate is now at a fresh 26-year high of 9.8%.
"Compared to previous recessions, the pace of the current recovery can only be characterized as glacial," said Mike Fitzpatrick, who works at MF Global.
Rising unemployment weighs heavily on the US economy, which relies heavily on consumer spending to power growth.
The number of people out of work has risen by 7.6 million since December 2007 to 15.1 million.

Record low in months

After declining to record low in months versus the euro and the dollar, the pound rebounded today as reports unexpectedly improved the sentiment towards the economic recovery in the United Kingdom, stopping the losing streak for the British currency.
Тhe Office for National Statistics posted a report today indicating a lower than expected decline in U.K.’s gross domestic product, which combined with a positive retail sales report provided support for the British currency to pare some of its previous losses versus the euro and the greenback in the beginning of the week.
GBP/USD traded at 1.5955 as of 21:55 GMT from 1.5887 yesterday.
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The sharpest climb

The Canadian dollar, one of the most dependent currency to stocks and commodities, climbed significantly today as optimism pushed the crude oil and gold rates up, suggesting that the global economy will improve demand for Canadian exports.
The loonie, as the Canadian dollar is often referred, witnessed a significant rally today being the sharpest climb in September provoked by optimism that increased risk appetite among traders as commodities rose and the International Monetary Fund cut its forecast for global economic declines, adding to the already positive sentiment in trading markets today.
USD/CAD traded at 1.0675 as of 21:56 GMT from a previous rate of 1.0855 yesterday.
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