Eurogroup President Jean-Claude Juncker called Germany’s flat rejection of proposals for joint eurozone bonds “un-European” on Wednesday, prompting accusations from Berlin he was making markets uneasy.
IMF Managing Director Dominique Strauss-Kahn also jumped into the fray, saying the situation in Europe remained troubling and that it faced posting very slow growth if it failed to pull itself together.
Juncker, who chairs meetings of eurozone finance ministers, told German weekly Die Zeit that Berlin had not even properly looked at his proposal, which was aimed at helping weaker eurozone members raise money.
“They are rejecting an idea before studying it ... This way of creating taboo areas in Europe and not dealing with others’ ideas is a very un-European way of dealing with European matters,” said Juncker, who is also Luxembourg’s prime minister.
“It doesn’t help anyone in Europe if European figures call each other un-European,” German Chancellor Angela Merkel’s spokesman Steffen Seibert responded in a regular government briefing. “It is exactly this talking against other people and about other people which should stop, because the markets definitely see this finger-pointing as a sign of discord.”
Merkel herself urged “calm” ahead of summit of EU leaders on Friday next week, where discussions will focus on creating a permanent crisis mechanism for the eurozone and what the chancellor called “narrow” changes to EU treaties.
“I think that we should work in a calm and goal-oriented manner towards what awaits us next Friday. This calm manner is my contribution to making sure we are successful next Friday,” Merkel told reporters.
Such collective “E-bonds” could help eurozone members seen by investors as having shaky public -finances lower their -borrowing costs.
Sky-high interest rates for Irish and Greek bonds contributed to both countries having to seek outside help, and there are fears that other countries like Portugal and Spain might follow suit for the same reason.
However, at a meeting of eurozone finance ministers this week, Germany was adamant that it thought Juncker’s idea was not the way forward.
Germany has also put its foot down over increasing the size of the 750 billion euro (US$998 billion) EU-IMF bailout fund.
Speaking in Geneva, Strauss-Kahn warned that the eurozone risked posting very slow growth.
“The situation in Europe remains troubling, and the future is more uncertain than ever,” Strauss-Kahn said.
“I don’t believe that the euro is in danger,” he told a public forum organized by the UN. “On the other hand, I think that if the eurozone does not pull itself together quickly enough, it would risk having periods of very slow, difficult growth, that it could avoid on condition that its governance is greatly improved.”
‘ACCORDING TO PLAN’: A company official said that it has set up production sites worldwide to provide services and that its Wisconsin project was going smoothly Hon Hai Precision Industry Co’s (鴻海精密) smart manufacturing center in Wisconsin would begin trial manufacturing in the middle of this year, the company said yesterday, adding that it plans to build a research institute to develop key technologies to support growth over the next five years. Hon Hai, known internationally as Foxconn Technology Group (富士康科技集團), said in an annual report submitted to the Taiwan Stock Exchange that its planned Foxconn Institute for Research in Science and Technology would conduct research into artificial intelligence, next-generation communications, quantum computing, cybersecurity and nano semiconductors in Taiwan. Hon Hai is to make products at the center
STAYING AHEAD: Fitch said that TSMC remains technologically ahead of others, but Samsung is building a new chip fab, while China is investing in its domestic industry As escalating US-China tensions and COVID-19-related production disruptions force US technology supply chains to transform, Taiwan Semiconductor Manufacturing Co’s (TSMC, 台積電) US$12 billion chip fabrication plant in Arizona would be key to spurring greater US production of core semiconductor components, Fitch Ratings said. “We view the US-TSMC alliance as a first step in building a more autonomous US technology supply chain, given high barriers to entry, specifically related to the significant capital and design capability required for leading-edge semiconductor manufacturing,” Fitch said in a statement on Tuesday. “By working with TSMC, US chipmakers will not face the financial burden of incremental investment
E Ink Holdings Inc (元太科技), the world’s sole supplier of e-paper displays for e-readers and shelf labels, posted its best quarterly net profit for the first quarter in nine years amid increased demand during a traditionally slow season. Net profit soared 80 percent to NT$787 million (US$26.23 million) in the quarter ended March 31, compared with NT$438 million a year earlier. That translated into earnings per share of NT$0.69, up from NT$0.39. E Ink posted lower royalty income of NT$371.23 million last quarter from NT$448.74 million a year earlier, a company financial statement showed. E Ink said that it expects royalty income to
DIVERSIFICATION: Although COVID-19 would push more companies to produce in emerging markets, DBS said that it was unlikely that firms would totally leave China Geopolitical tensions and supply disruptions are expected to accelerate the migration of manufacturing out of China, as concerns about the risk of production concentrated in one country increase, S&P Global Ratings said. Although its economic expansion might be weaker than previous levels due to the accelerated relocation of manufacturing, China’s economic growth would still be stronger than that of most other economies, the ratings agency said. “While absolute growth rates will moderate, we believe China’s economic performance will continue to be a key sovereign credit support,” S&P Global Ratings credit analyst Tan Kim Eng (陳錦榮) said in a statement on Thursday. “Its growth