Fitch Ratings warned it would treat a voluntary rollover of Greece’s sovereign bonds in any rescue package as a default and would cut the credit rating, keeping pressure on European policymakers who intend to outline a new plan by the middle of next month.
Fractious eurozone finance ministers are trying to patch together a second aid package for Greece, with more official loans and, for the first time, a contribution by private investors of Greek government bonds.
“The essence of the problem ... is that Greece needs new money,” Andrew Colquhoun, head of Asia-Pacific sovereign ratings with Fitch, said at a conference in Singapore.
“Fitch would regard such a debt exchange or voluntary debt rollover as a default event and would lead to the assignment of a default rating to Greece,” he said.
Greece has rattled financial markets as Athens and European policymakers try to avert the first debt default by a eurozone country.
After two days of crisis talks in Brussels, eurozone finance ministers issued Athens an ultimatum, saying the government, parliament and broader society had until July 3 to approve new steps in order to get the next installment of the 110 billion euros (US$157.8 billion) in EU and IMF aid agreed in May last year.
A month ago, Fitch downgraded Greece’s credit rating three notches to “B+” and warned it could cut the rating further into junk territory. Standard & Poor’s cut Greece’s rating to “CCC” from “B” on Monday last week and warned that any attempt to -restructure the country’s debt would be considered a default. Moody’s has a “Caa1” rating on Greece’s sovereign debt, which implies a 50 percent chance of a default within three to five years.
Fitch said it also saw risks of a debt default in the US, whose top-rated bonds may suffer if the country doesn’t lift its fiscal borrowing ceiling, as several developed countries struggle to deal with increased debt built up during the global financial crisis.
Colquhoun reiterated that Fitch would place the US sovereign rating on watch negative if US Congress did not raise the federal government’s borrowing ceiling by Aug. 2. The US Department of the Treasury says Congress must raise the US$14.3 trillion debt ceiling by then to avoid a potential default.
If the US government misses an Aug. 15 coupon payment, Fitch would place the rating on restricted default. Still, Colquhoun said it believed the debt ceiling would be raised and a default would be avoided.
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
Sales in the retail, and food and beverage sectors last month continued to rise, increasing 0.7 percent and 13.6 percent respectively from a year earlier, setting record highs for the month of March, the Ministry of Economic Affairs said yesterday. Sales in the wholesale sector also grew last month by 4.6 annually, mainly due to the business opportunities for emerging applications related to artificial intelligence (AI) and high-performance computing technologies, the ministry said in a report. The ministry forecast that retail, and food and beverage sales this month would retain their growth momentum as the former would benefit from Tomb Sweeping Day
TRANSFORMATION: Taiwan is now home to the largest Google hardware research and development center outside of the US, thanks to the nation’s economic policies President Tsai Ing-wen (蔡英文) yesterday attended an event marking the opening of Google’s second hardware research and development (R&D) office in Taiwan, which was held at New Taipei City’s Banciao District (板橋). This signals Taiwan’s transformation into the world’s largest Google hardware research and development center outside of the US, validating the nation’s economic policy in the past eight years, she said. The “five plus two” innovative industries policy, “six core strategic industries” initiative and infrastructure projects have grown the national industry and established resilient supply chains that withstood the COVID-19 pandemic, Tsai said. Taiwan has improved investment conditions of the domestic economy