Flextronics to step up hiring
Flextronics International Ltd, a contract maker of electronics for other companies, will triple the number of engineers it employs this year after opening a center to develop notebook computers in Taipei.
The company, which already has operations at two other sites, plans to employ more than 1,500 engineers by the end of the year, up from about 500, Valerie Kurniawan, a spokeswoman for the Singapore-based manufacturer, said yesterday by phone.
Flextronics completed the US$192 million acquisition of the notebook and server units of Taipei-based Arima Computer Corp (華宇電腦) in October, adding to its US$3 billion purchase of Solectron Corp a year earlier and marking its entry into the laptop market.
The company will also expand its notebook and PC making capacity in China to enable it to produce 1 million units a month within two years, Sean Burke, president of the firm’s computing products unit, said at a briefing in Taipei yesterday.
Stimulus package planned
The government has earmarked NT$313 billion (US$9.4 billion) for an economic stimulus package next year, the Council for Economic Planning and Development said yesterday.
The extra spending would help create 167,000 jobs and boost the nation’s GDP growth next year by 1.88 percentage points, the council said in an e-mailed statement. Projects include roads, railways and flood prevention, the council said.
The economy shrank an unprecedented 10.24 percent in the first quarter from a year earlier as exports fell and businesses cut spending, the statistics bureau said on May 21. GDP may contract 4.25 percent this year, it said.
To revive economic growth, the government plans NT$858.5 billion of spending over four years, equal to about 6 percent of GDP, on infrastructure, consumer grants and tax cuts.
It handed out NT$82.9 billion of shopping vouchers in January.
Loan growth to pressure banks
A rapid rise in China’s loan growth in the first half of this year is likely to intensify pressure on its banking system and worsen its asset quality, Standard & Poor’s Ratings Services said in a report yesterday.
“Asset quality is likely to further slip in 2009, but should remain highly manageable. The severity of pressure depends on macroeconomic conditions at home and abroad. Asset quality would deteriorate sharply in the next two to three years if the economic slowdown were protracted in China,” said the rating agency’s credit analyst Liao Qiang (廖強).
“The banking system should, however, have the strength to deal with the deterioration in asset quality, based on our current economic outlook, but the credit profiles of banks are likely to diverge,” he said.
Loan growth among Chinese banks hit a record high of 7.5 trillion yuan (US$1.1 trillion) in the first half of this year. The agency warned that corporate governance remained an issue for Chinese banks at a time when their risk management capability was still developing.
Policymakers in China are likely to stay committed to market-oriented banking reforms, despite some setbacks and the current economic conditions, it added.
NT dollar weaker
The New Taiwan dollar weakened 0.4 percent yesterday, falling by NT$0.143 to close at NT$33.193 — its lowest level since May 6.
Turnover was US$1.243 billion.