US Secretary of the Treasury Jack Lew said he will call on Chinese leaders to let markets determine the value of the yuan and to avoid postponing measures to overhaul their economy even as growth falters.
“They obviously have to worry about their short-term economic situation,” Lew said in an interview on Bloomberg Television’s Political Capital with Al Hunt, airing this weekend. “What they can’t do is treat the long-term reforms as something they can just put off. They need to be serious about it.”
Lew, who will meet with Chinese officials on Tuesday in Beijing, said that while China has made some progress in loosening restrictions on its currency, “we’ve seen some very negative movement in the exchange rate in recent months.”
Lew said he has been telling his counterparts to avoid becoming an alternative source of funding to Russia as US sanctions begin to bite.
“We’ve been making the case consistently, wherever we go, that it’s unacceptable for Russia to violate Ukraine’s sovereignty,” he said. “And that when we take actions and other countries in the world take action, it is important for there not to be backfill.”
Russian President Vladimir Putin plans to open the door to Chinese money as US and European sanctions over Ukraine threaten to tip the economy into recession, two senior government officials said.
The move would roll back informal limits on Chinese investment as Russia seeks to stimulate growth, said the officials, who have direct knowledge of talks and asked not to be identified because the information is not public.
On the strategy for imposing sanctions against Russia, Lew said the administration has “made very clear that our goal is not to go to the maximum degree that one can to hurt the Russian economy. It’s to get President Putin to change Russia’s policy.”
“We have been moving step by step and in a very surgical way,” he said. “The goal here is not to hurt the European economy, the American economy. It’s not to hurt the Russian people.”
While US officials have discussed targeting entire sectors of the Russian economy, such as energy and finance, they have so far only applied sanctions against 45 individuals, including OAO Rosneft chief executive officer Igor Sechin, and 19 entities, including SMP Bank and Bank Rossiya.
Lew said he is seeking changes in China that will allow US companies to sell their products and services on a “level playing field.”
China’s economy expanded 7.4 percent in the first quarter, the least in almost two years.
General Motors Co, which sells more cars in China than anywhere else, reported deliveries there increased 6.3 percent last month, the slowest pace in 14 months.
The yuan has fallen 2.8 percent this year after gaining 3 percent last year. It fell to an intraday low of 6.2676 per US dollar on April 30, the weakest since October 2012, according to data compiled by China Foreign Exchange Trade System, and closed at 6.228 per dollar on Friday.
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
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
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],”
MAJOR BENEFICIARY: The company benefits from TSMC’s advanced packaging scarcity, given robust demand for Nvidia AI chips, analysts said ASE Technology Holding Co (ASE, 日月光投控), the world’s biggest chip packaging and testing service provider, yesterday said it is raising its equipment capital expenditure budget by 10 percent this year to expand leading-edge and advanced packing and testing capacity amid strong artificial intelligence (AI) and high-performance computing chip demand. This is on top of the 40 to 50 percent annual increase in its capital spending budget to more than the US$1.7 billion to announced in February. About half of the equipment capital expenditure would be spent on leading-edge and advanced packaging and testing technology, the company said. ASE is considered by analysts