GERMANY
Crisis to affect performance
Europe’s sovereign debt crisis will dampen the German economy’s performance this year, the Ifo economic research institute said. While economic growth in Europe’s largest economy may accelerate to 1.3 percent next year, heightened uncertainty about the debt crisis will weigh on growth in the middle part of this year, Munich-based Ifo said yesterday. Ifo forecast expansion of 0.7 percent for this year.
SOUTH KOREA
Current account improves
South Korea’s current account surplus hit a six-month high last month as dividend payments to foreign investors declined and the service sector improved, figures showed yesterday. The surplus, the broadest measure of overseas trade, was US$3.61 billion last month compared with a revised US$1.73 billion in April and US$2.18 billion in May last year, the Bank of Korea said. It was the largest figure since a US$4.56 billion surplus in November last year.
BRAZIL
Stimulus package planned
The government announced a new US$4 billion economic stimulus package to combat stagnant growth. The program announced on Wednesday by President Dilma Rousseff focuses on a wide array of government purchases, from backhoes to motorcycles to military equipment. The economy grew just 0.2 percent in the first quarter of this year. The government maintains a target of 4 percent growth this year, but market forecasts put expansion at 2.2 percent.
FINANCE
Town heads for bankruptcy
The town of Stockton, California, was headed for the nation’s largest ever municipal bankruptcy on Wednesday after it failed to find a way to close a US$26 million budget shortfall. A victim of the collapse of real-estate prices, which wiped out its tax base, the Stockton city council decided late on Tuesday to implement a “pendency plan,” for managing curtailed spending ahead of a court filing for protection. “The city will file sometime before Friday, close of business,” city spokeswoman Connie Cochran said.
ENERGY
Gazprom debt declines
OAO Gazprom, Russia’s biggest company by market value, plans to reduce its total debt about 4.7 percent this year, while earnings may decline 10 percent. Debt is forecast to decline to 1.47 trillion rubles (US$44 billion) this year from 1.54 trillion rubles last year, the Moscow-based natural-gas producer and exporter said yesterday in a presentation. Earnings before interest, taxes, depreciation and amortization may decline 10 percent this year, chief financial officer Andrey Kruglov said in Moscow.
FINANCE
Barclays pays to settle
Barclays PLC and its subsidiaries will pay more than US$450 million to settle charges that they tried to manipulate interest rates that can affect how much people pay for loans to attend college or buy a house. The incidents occurred between 2005 and 2009 and sometimes took place daily, the US Commodity Futures Trading Commission (CFTC) said on Wednesday in announcing the settlement. A US$200 million civil penalty levied against Barclays is the largest in the CFTC’s history. Barclays also agreed to pay US$160 million as part of an agreement with the Justice Department’s criminal division on a related matter. It will also pay nearly US$93 million to British regulators.
WASHINGTON’S INCENTIVES: The CHIPS Act set aside US$39 billion in direct grants to persuade the world’s top semiconductor companies to make chips on US soil The US plans to award more than US$6 billion to Samsung Electronics Co, helping the chipmaker expand beyond a project in Texas it has already announced, people familiar with the matter said. The money from the 2022 CHIPS and Science Act would be one of several major awards that the US Department of Commerce is expected to announce in the coming weeks, including a grant of more than US$5 billion to Samsung’s rival, Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), people familiar with the plans said. The people spoke on condition of anonymity in advance of the official announcements. The federal funding for
HIGH DEMAND: The firm has strong capabilities of providing key components including liquid cooling technology needed for AI servers, chairman Young Liu said Hon Hai Precision Industry Co (鴻海精密) yesterday revised its revenue outlook for this year to “significant” growth from a “neutral” view forecast five months ago, due to strong demand for artificial intelligence (AI) servers from cloud service providers. Hon Hai, a major assembler of iPhones that is also known as Foxconn, expects AI server revenues to soar more than 40 percent annually this year, chairman Young Liu (劉揚偉) told investors. The robust growth would uplift revenue contribution from AI servers to 40 percent of the company’s overall server revenue this year, from 30 percent last year, Liu said. In the three-year period
LONG HAUL: Largan Energy Materials’ TNO-based lithium-ion batteries are expected to charge in five minutes and last about 20 years, far surpassing conventional technology Largan Precision Co (大立光) has formed a joint venture with the Industrial Technology Research Institute (ITRI, 工研院) to produce fast-charging, long-life lithium-ion batteries for electric vehicles, mobile electronics and electric storage units, the camera lens supplier for Apple Inc’s iPhones said yesterday. Largan Energy Materials Co (萬溢能源材料), established in January, is developing high-energy, fast-charging, long-life lithium-ion batteries using titanium niobium oxide (TNO) anodes, it said. TNO-based batteries can be fully charged in five minutes and have a lifespan of 20 years, a major advantage over the two to four hours of charging time needed for conventional graphite-anode-based batteries, Largan said in a
Taiwan is one of the first countries to benefit from the artificial intelligence (AI) boom, but because that is largely down to a single company it also represents a risk, former Google Taiwan managing director Chien Lee-feng (簡立峰) said at an AI forum in Taipei yesterday. Speaking at the forum on how generative AI can generate possibilities for all walks of life, Chien said Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) — currently among the world’s 10 most-valuable companies due to continued optimism about AI — ensures Taiwan is one of the economies to benefit most from AI. “This is because AI is