■ELECTRONICS
Hon Hai to relocate staff
Hon Hai Precision Industry Co (鴻海精密) plans to relocate 160,000 China-based workers from coastal Shenzhen to inner cities so as to benefit from preferential taxes offered by provincial governments, the Chinese-language Commercial Times reported yesterday. Hon Hai, the world’s largest contract maker of electronics, may spend NT$10 billion (US$302.8 million) to facilitate the business relocation, the report said. The company’s 260,000 employees at the Shenzhen plant would also be cut to 100,000 while the remaining employees would be relocated to new plants in Wuhan, Huaibei Province, and Jincheng, Shanxi Province. Company spokesman Edmund Ding (丁祈安) was quoted as saying that these inner cities have offered Hon Hai not only preferential business income taxes, lower than the 25 percent rate in other coastal cities, but also preferential access to public utilities, the report said.
■CHINA
Foreign debt increases
China’s foreign debt increased by more than 18 percent in the first nine months of the year, with short-term debt rising especially fast, state media reported yesterday. At the end of September, overseas borrowing stood at US$442 billion, a rise of 18.3 percent from the end of last year, Xinhua news agency said, quoting the State Administration of Foreign Exchange. It did not offer an explanation for the rise. Short-term debt — defined as loans with maturities of less than one year — had risen particularly fast, increasing by 27.2 percent over the nine-month period to US$280 billion, Xinhua reported. Medium to long-term debt was up by a more moderate 5.5 percent to US$162 billion, Xinhua reported.
■AUTOMAKERS
Beijing to stimulate sales
China plans to offer incentives for car owners to scrap their old models in favor of new ones in a bid to lift the auto industry as it enters a period of crisis, state media said yesterday. The measure is part of a new package being prepared in Beijing aimed at avoiding a US-style collapse of the local auto sector, Xinhua news agency reported. “Details of the plan will be announced very soon,” an unnamed official with the commerce ministry said shortly after dismal figures were released showing that Chinese auto sales fell 14.6 percent last month from a year earlier. Other measures that China may adopt to bolster auto sales include cuts in the 10 percent vehicle purchase tax and easier access to car loans, Xinhua said.
■AIRPORTS
Hong Kong staff strike
Baggage handlers at Hong Kong’s international airport launched a three-hour strike yesterday to protest the cancelation of their merit bonus, a labor organizer said. The workers, along with freight handlers, tarmac workers and airport bus drivers, started the strike at 1pm after talks with Hong Kong Airport Services Ltd broke down, organizer Ip Wai-ming (葉偉明) told reporters. Local television news showed approximately 100 workers on strike gathered near cargo carts at the airport. Ip said the workers make between HK$6,000 to HK$8,000 (US$770 to US$1,030) a month and that the bonus, which usually amounts to a month’s pay, is crucial to their livelihoods. He said management at Hong Kong Airport Services refused to resume the full bonus pay, but offered a one-time additional payment of HK$750 to each employee. “This is quite far from what we demanded,” Ip said.
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ENERGY IMPACT: The electricity rate hike is expected to add about NT$4 billion to TSMC’s electricity bill a year and cut its annual earnings per share by about NT$0.154 Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) has left its long-term gross margin target unchanged despite the government deciding on Friday to raise electricity rates. One of the heaviest power consuming manufacturers in Taiwan, TSMC said it always respects the government’s energy policy and would continue to operate its fabs by making efforts in energy conservation. The chipmaker said it has left a long-term goal of more than 53 percent in gross margin unchanged. The Ministry of Economic Affairs concluded a power rate evaluation meeting on Friday, announcing electricity tariffs would go up by 11 percent on average to about NT$3.4518 per kilowatt-hour (kWh)
OPENING ADDRESS: The CEO is to give a speech on the future of high-performance computing and artificial intelligence at the trade show’s opening on June 3, TAITRA said Advanced Micro Devices Inc (AMD) chairperson and chief executive officer Lisa Su (蘇姿丰) is to deliver the opening keynote speech at Computex Taipei this year, the event’s organizer said in a statement yesterday. Su is to give a speech on the future of high-performance computing (HPC) in the artificial intelligence (AI) era to open Computex, one of the world’s largest computer and technology trade events, at 9:30am on June 3, the Taiwan External Trade Development Council (TAITRA) said. Su is to explore how AMD and the company’s strategic technology partners are pushing the limits of AI and HPC, from data centers to