Cisco announces job cuts
Cisco Systems Inc said on Wednesday that it is laying off 1,100 more workers, deepening job losses at the Internet gear maker, which is battling declining revenue. The new round of layoffs comes on top of the 5,500 jobs Cisco announced it was cutting in August last year. That amounted to about 7 percent of its workforce at the time. The San Jose, California-based company on Wednesday reported US$11.94 billion in revenue for its fiscal third quarter that ended last month. That was down from US$12 billion a year earlier. It said it expects revenue to dip 4 to 6 percent in the quarter ending in July compared with a year ago.
Jakarta seeks higher growth
Indonesian Minister of Finance Sri Mulyani Indrawati said boosting economic growth above 5.6 percent next year was “very critical” and she hoped the government would not need to cut spending this year to keep the budget deficit in check. Exports are rebounding quite strongly and “that’s encouraging,” Indrawati said on Wednesday in an interview on the sidelines of the Islamic Development Bank’s annual meeting in Jeddah, Saudi Arabia. The global outlook has improved and domestic demand is holding up, she said. The government is targeting growth of 5.1 to 5.2 percent this year and estimates the budget deficit would reach 2.4 percent of GDP, below the 3 percent cap.
Australian employment up
Australia’s jobless rate fell last month, adding to the previous month’s strong employment gains, reinforcing expectations that the central bank would not cut interest rates further. Employment rose by 37,400 jobs from March and the jobless rate fell to 5.7 percent last month, the lowest since January, according to the latest government data released yesterday. Full-time jobs fell by 11,600, while part-time employment rose by 49,000, data showed. The labor participation rate held at 64.8 percent versus the 64.7 percent forecast by analysts.
Price growth in China eases
Growth in China’s housing prices eased last month after authorities imposed more restrictions on property purchases. New home prices, excluding state-subsidized housing, rose last month in 58 of the 70 cities tracked by the government, compared with 62 in March, the National Bureau of Statistics said yesterday. Prices fell in eight cities and were unchanged in four, the data showed. On an annual basis, new home prices rose in 69 cities last month, compared with 68 in March. Meanwhile, foreign direct investment into China fell 0.1 percent to 286.41 billion yuan (US$41.56 billion) in the first four months of this year from the same period a year earlier, the Ministry of Commerce said yesterday.
Volvo to abandon diesel
Volvo Car Co might stop developing new diesel engines due to high costs triggered by stricter regulations, the head of Swedish carmaker said in an interview with the Frankfurter Allgemeine Zeitung published on Wednesday. “From today’s perspective we will no longer develop any new generation diesel engines,” chairman Hakan Samuelsson said. The company will continue building its latest model of diesel engines, first developed in 2013, but Samuelsson said it would be too costly to invest in research for a new motor. He said it was unclear how long the current diesel program would run, but the newspaper estimated that it could end in 2023.
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
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
Taiwan’s corporate landscape has changed significantly over the past 20 years, with Hon Hai Precision Industry Co (鴻海精密) replacing Formosa Plastics Corp (台塑) as the revenue leader, while Taiwan Semiconductor Manufacturing Co. (TSMC, 台積電) has emerged as the most profitable firm, a survey of Taiwan’s 50 largest companies published on Tuesday last week showed. The Chinese-language CommonWealth Magazine survey ranked Taiwan’s 50 largest companies based on their revenue last year, and compared them with the results of a similar survey it conducted in 2000. Only 33 companies on the original list remained in this year’s rankings, the survey found, following two
GEOPOLITICAL RISKS: Beijing announced plans to strengthen ‘enforcement’ in Hong Kong, sparking losses across Asia led by the Hang Seng’s 5.6 percent plunge Local shares on Friday ended sharply lower amid renewed tensions between the US and China over Chinese telecommunications equipment giant Huawei Technologies Co Ltd (華為) and China’s plan to introduce a national security law in Hong Kong. The TAIEX on Friday finished down 197.16, or 1.79 percent, at 10,811.15 on turnover of NT$177.183 billion (US$5.9 billion), almost flat from a close of 10,814.92 on May 15. The market was down across all major sectors, in particular electronics shares, which finished down 1.99 percent from Thursday’s close. Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s largest wafer foundry and a chip supplier