IMF warns MENA over debt
The IMF yesterday warned Arab states against complacency over a looming debt crisis, urging continued economic reforms despite a rise in oil prices. Crude prices have rebounded in the region thanks to a deal by producers to trim production, but the IMF said such a change in fortunes should not get in the way of overhauling state spending. Overall growth in the Middle East and North Africa (MENA) region, which includes all Arab countries and Iran, was forecast by the IMF to reach 3.2 percent this year compared with just 2.2 percent last year.
S&P downgrades Turkey
Ratings agency Standard & Poor’s (S&P) on Tuesday said it had cut the rating on Turkey’s foreign debt due to deteriorating finances and rising inflation. The rating on the nation’s foreign currency debt dropped to “B-/B” for long and short-term issues respectively, but with a stable outlook, S&P said in a statement. “Our downgrade reflects our view that there is a risk of a hard landing for Turkey’s overheating, credit-fueled economy,” it said.
Samsung unit breaks rules
A South Korean regulator said that Samsung Biologics Co had breached accounting rules in a preliminary finding that could deal a big blow to the company and other Samsung affiliates if finalized. The Financial Supervisory Service yesterday said it had wrapped up its one-year probe into Samsung Biologics and notified the company of the violation. Samsung Biologics is denying the accounting breaches. Despite its defense, its stock price tanked, finishing 17.2 percent lower.
Weinstein finds buyer
A private equity firm has emerged as the winning bidder for the Weinstein Co, the film and TV studio forced into bankruptcy by the sexual misconduct scandal that brought down Hollywood mogul Harvey Weinstein.Weinstein Co on Tuesday announced that no other bidder offered it more value than Dallas-based Lantern Capital, which offered US$310 million in cash for the firm’s assets and agreed to assume about US$125 million in project-related debt and to cover obligations related to the assumption of certain contracts and leases.
HNA to sell property unit
HNA Group Co (海航集團) plans to sell a real-estate unit for 2.9 billion yuan (US$456 million). HNA Investment Group Co is to sell a subsidiary that has the right to develop a project in Shanghai to a unit of real-estate developer Fusheng Group (復盛), according to a filing with the Shenzhen Stock Exchange yesterday. HNA expects to generate a 400 million yuan gain from the deal, which is subject to shareholders’ approval.
Xerox CEO to resign
The chief executive of Xerox Corp, a major photocopy maker, will resign according to a statement issued following a US judge’s temporarily block of the US company’s planned takeover by Japan’s Fujifilm Holdings Corp. The agreement ends a battle launched by Darwin Deason and Carl Icahn, who together control 15.2 percent of Xerox shares and objected to the proposed deal. According to the Xerox statement, CEO Jeff Jacobson is expected to be replaced by Keith Cozza as board chairman and John Visentin as CEO — candidates supported by the two shareholders.
’WHITE BOX’: The open platform would give local firms access to Cisco’s cloud-based mobile network to develop 5G telecom equipment and tap into the global market The Ministry of Economic Affairs (MOEA) yesterday introduced a new 5G “open lab” in collaboration with US-based information technology and networking giant Cisco Systems Inc to address the rapidly growing “white box” 5G networking equipment market. The open lab will be a platform where Taiwanese manufacturers can access Cisco’s cloud-based mobile network to develop their own 5G telecom equipment, such as small-cell base stations, network switches, modems and Internet of things (IoT) devices, a ministry statement said. The open platform would allow Taiwanese manufacturers to tap into the lucrative 5G telecom equipment market, which was previously monopolized by Nokia Oyj, Ericsson AB
Nintendo Co is raising its target for Switch production to about 25 million units this fiscal year, people familiar with the matter said, as the ongoing COVID-19 pandemic keeps lifting demand and component shortages ease. The Kyoto, Japan-based company, which in April hiked orders to 22 million units by March next year, is asking partners to tack on another few million units, said the people, who did not want to be identified discussing internal goals. Assembly partners plan to work at maximum capacity through December. The new production target suggests that Nintendo is likely to outperform its Switch sales forecast of 19 million
‘BIG LOSS’: This year might see the last generation of Huawei’s Kirin chips, as their production would stop next month because they are made using US technology Chinese tech giant Huawei Technologies Co (華為) is running out of processor chips to make smartphones due to US sanctions and would be forced to stop production of its own most advanced chips, a company executive has said, in a sign of growing damage to Huawei’s business from US pressure. Huawei, one of the biggest producers of smartphones and network equipment, is at the center of US-Chinese tension over technology and security. Washington last year cut off Huawei’s access to US components and technology, and those penalties were tightened in May, when the White House barred vendors worldwide from using US
The US stock market has been on a tear, yet the country’s economy is in the dumps. So why do so many people believe — undoubtedly incorrectly — that the stock market has decoupled from reality? The economy many people experience, while bleak, is local, personal and, for the most part, either not publicly traded or plays only a small part in the stock market’s moves. To explain why these personal experiences have so little effect on equity markets, we must look more closely at the market role of the weakest industry sectors. The surprising conclusion: The most visible and economically vulnerable