GERMANY
GDP grows by 0.4%
Strong foreign trade and buoyant consumption drove Europe’s largest economy to better-than-expected growth in the second quarter, federal statistics office Destatis said yesterday. GDP grew by 0.4 percent between April and June, adjusted for seasonal, calendar and price effects — twice as fast as analysts surveyed by Factset predicted. However, the final figure, which confirmed a preliminary Destatis reading earlier this month, represented a slowdown from the unexpectedly strong 0.7 percent expansion in the first quarter.
TRANSPORTATION
Iran firms eye canal pie
Iranian firms want to participate in the construction of a massive canal across Nicaragua that a Chinese company has vowed to build, Iranian Minister of Foreign Affairs Mohammed Javad Zarif said on Tuesday. Representatives of private Iranian companies accompanying Zarif on a visit to Nicaragua’s capital discussed the possibility of getting a slice of the US$50 billion project, the minister told a news conference. The ambitious plan calls for a waterway linking the Pacific and Atlantic oceans that would rival the century-old one in Panama, which has recently been expanded to take bigger ships. Work on Nicaragua’s canal, meant to have started two years ago, has not begun.
AUTOMAKERS
VW resolves dispute
Volkswagen AG and two of its parts suppliers on Tuesday resolved a contract dispute that had hit output at more than half of the carmaker’s German plants. After more than 20 hours of negotiations that went on through the night, VW said it had settled its differences with CarTrim, which makes seats, and ES Automobilguss, which produces cast iron parts needed to make gearboxes, but gave no details. The suppliers were seeking compensation for lost revenue they said ran into tens of millions of euros after VW canceled a contract. VW on Tuesday said that the suppliers had agreed to start delivering parts again and the affected plants would gradually resume production.
MANUFACTURING
Honda normalizes production
Honda Motor Co has resumed full production of motorcycles at a Japanese plant that was idled by major earthquakes in April. The company yesterday said that it had “virtually normalized” production at a factory in Kumamoto, on the southern island of Kyushu, as of Tuesday. Honda said it was still working to fully stabilize its supply network for engine parts for mini vehicles, transferring some of the production from Kumamoto to a factory Suzuka, in eastern Japan. The motorcycle plant was severely damaged and initially it was unsafe to go inside to inspect it due to repeated aftershocks.
AGRIBUSINESS
COFCO to buy out Nidera
State-owned China National Cereals, Oils and Foodstuffs Corp (COFCO, 中國糧油集團) will buy out minority shareholders in Netherlands-based commodity trader Nidera BV and take full ownership of the company, it said, as it seeks to become an agribusiness powerhouse. COFCO’s deal to buy out the remaining 49 percent of Nidera, which trades grains and soybeans among other agricultural commodities, comes two years after it bought more than half of the company for US$1.2 billion. Financial terms of the new deal, which awaits regulatory approval, were not disclosed.
China has claimed a breakthrough in developing homegrown chipmaking equipment, an important step in overcoming US sanctions designed to thwart Beijing’s semiconductor goals. State-linked organizations are advised to use a new laser-based immersion lithography machine with a resolution of 65 nanometers or better, the Chinese Ministry of Industry and Information Technology (MIIT) said in an announcement this month. Although the note does not specify the supplier, the spec marks a significant step up from the previous most advanced indigenous equipment — developed by Shanghai Micro Electronics Equipment Group Co (SMEE, 上海微電子) — which stood at about 90 nanometers. MIIT’s claimed advances last
ISSUES: Gogoro has been struggling with ballooning losses and was recently embroiled in alleged subsidy fraud, using Chinese-made components instead of locally made parts Gogoro Inc (睿能創意), the nation’s biggest electric scooter maker, yesterday said that its chairman and CEO Horace Luke (陸學森) has resigned amid chronic losses and probes into the company’s alleged involvement in subsidy fraud. The board of directors nominated Reuntex Group (潤泰集團) general counsel Tamon Tseng (曾夢達) as the company’s new chairman, Gogoro said in a statement. Ruentex is Gogoro’s biggest stakeholder. Gogoro Taiwan general manager Henry Chiang (姜家煒) is to serve as acting CEO during the interim period, the statement said. Luke’s departure came as a bombshell yesterday. As a company founder, he has played a key role in pushing for the
EUROPE ON HOLD: Among a flurry of announcements, Intel said it would postpone new factories in Germany and Poland, but remains committed to its US expansion Intel Corp chief executive officer Pat Gelsinger has landed Amazon.com Inc’s Amazon Web Services (AWS) as a customer for the company’s manufacturing business, potentially bringing work to new plants under construction in the US and boosting his efforts to turn around the embattled chipmaker. Intel and AWS are to coinvest in a custom semiconductor for artificial intelligence computing — what is known as a fabric chip — in a “multiyear, multibillion-dollar framework,” Intel said in a statement on Monday. The work would rely on Intel’s 18A process, an advanced chipmaking technology. Intel shares rose more than 8 percent in late trading after the
GLOBAL ECONOMY: Policymakers have a choice of a small 25 basis-point cut or a bold cut of 50 basis points, which would help the labor market, but might reignite inflation The US Federal Reserve is gearing up to announce its first interest rate cut in more than four years on Wednesday, with policymakers expected to debate how big a move to make less than two months before the US presidential election. Senior officials at the US central bank including Fed Chairman Jerome Powell have in recent weeks indicated that a rate cut is coming this month, as inflation eases toward the bank’s long-term target of two percent, and the labor market continues to cool. The Fed, which has a dual mandate from the US Congress to act independently to ensure