BEVERAGES
InBev picks underwriters
Anheuser-Busch InBev NV has selected JPMorgan Chase & Co and Morgan Stanley for a possible initial public offering of its Asian operations in what could be one of the region’s biggest listings this year, people with knowledge of the matter said. The world’s largest brewer is weighing Hong Kong as a listing venue, though it has not made a final decision, the people said. The Belgium-based company is considering adding more arrangers to the deal later, one of the people said. An IPO of AB InBev’s Asia business could raise more than US$5 billion, people familiar with the matter said last month.
GERMANY
Budget shortfall looms
Germany faces a 25 billion euro (US$29 billion) budget shortfall by 2023, unless it tightens spending, as tax revenues are set to fall and public sector wages are on the rise, Bild newspaper reported, citing an internal government document. The prospect of budget deficits would represent a dramatic deterioration in the finances of Europe’s biggest economy, which reported a 11.2 billion euro budget surplus last year. The warning came in a report prepared by Finance Minister Olaf Scholz to his ministerial colleagues as they prepare for a regular budget planning discussion.
SERVICES
Foreign sales buoy China
China’s sprawling services sector maintained a solid pace of expansion last month even though growth moderated slightly, a private survey showed on Sunday. The Caixin/Markit services purchasing managers’ index (PMI) fell slightly to 53.6 last month from 53.9 in December last year, but was well above the 50 mark separating growth from contraction. Overseas sales continued to support the sector, with new export business rising at the fastest clip in more than a year, thanks to efforts among Chinese services firms to attract foreign clients. Overall new orders also ticked higher, to 52.6 from 52.3 in December.
AUSTRALIA
Building approvals slump
Australian building approvals suffered the biggest annual back-to-back drop in almost a decade as a housing slump deepens. Building permits fell 22.5 percent in December last year from a year earlier after plunging 33.5 percent in November, Australian Bureau of Statistics data showed yesterday. That is the worst two-month result since January-February 2009, during the depths of the global financial crisis. A separate private report from Australia & New Zealand Banking Group Ltd showed job advertisements slid 3.7 percent last month from a year earlier, the first annual decline since April 2015.
BREXIT
Irish farmers to get aid
The European Commission has agreed to compensate Irish farmers for a collapse in beef and dairy prices in the event of a no-deal Brexit, the Irish edition of the Sunday Times newspaper said, quoting Irish government and EU sources. Farmers would be in line for hundreds of millions of euros in emergency aid to offset a market collapse and the loss of British customers, the newspaper reported. Agriculture Minister Michael Creed said last month Dublin would seek that amount for its farming and fishing industry. The details of the scheme were finalized between Creed and the commission’s agriculture chief Phil Hogan, the report said.
INTERNET
Tonga sabotage considered
A director at Tonga’s undersea Internet cable operator said he cannot rule out sabotage as the reason the cable broke and plunged the Pacific nation into virtual darkness for almost two weeks. Repair crews found two breaks along the optic fiber cable that connects Tonga with the rest of the world, Tonga Cable Ltd director Piveni Piukala said yesterday. Several kilometers away, they found two more breaks and rope entangled on the separate domestic cable that connects the main island with some of Tonga’s outer islands.
DELIVERIES
Gig workers get holiday pay
Self-employed workers at Hermes Parcelnet Ltd, a UK-based delivery company, have won the option to get holiday pay and guaranteed earnings, as part of a deal with the GMB trade union that could have implications for Britain’s growing gig economy. The collective bargaining agreement is the first to recognize the rights of self-employed workers, the union said. A group of Hermes couriers won a legal battle in June to be classed as workers rather than self-employed.
TURKEY
Inflation hits 20.4% on food
A run-up in food costs halted a broader deceleration in price growth after two months. Inflation picked up slightly last month to 20.4 percent from a year earlier after a gain of 20.3 percent in the previous month, Turkstat said yesterday. Food and non-alcoholic beverage costs surged an annual 31 percent, the most since at least 2004. Shortages caused by floods in farming hub Antalya are making matters worse after the depreciation of the lira in August raised the cost of food imports and transportation.
BANKING
FAB may raise foreigner limit
First Abu Dhabi Bank PJSC (FAB) will follow regional peers and raise the foreign-ownership limit on its stock. The UAE’s biggest lender aims to raise the cap for foreign ownership to 40 percent from 25 percent, it said last week. Shareholders still need to approve the change at a meeting on Feb. 25. Investors from abroad held about 12 percent of FAB shares as of the end of last month, according to the stock exchange’s Web site. Qatar National Bank last year raised the ceiling for foreigners to 49 percent from 25 percent, while Emirates NBD PJSC plans to quadruple the limit for foreigners to 20 percent.
COMMUNICATIONS
Reliance to file for insolvency
Billionaire Anil Ambani’s Reliance Communications Ltd said it will file for insolvency following failed attempts to sell assets and repay about US$6.3 billion of debt. The company agreed to approach the National Company Law Tribunal after failing to pay lenders for the past 18 months, the company said. It blamed its decision to approach the court on a lack of consensus among its more than 40 lenders, as well as numerous issues pending before various agencies.
FEDERAL RESERVE
Powell ‘coming around’
US Federal Reserve Bank of Minneapolis President Neel Kashkari said Fed Chairman Jerome Powell is “coming around” to the view to wait until wages and inflation rise before raising interest rates again, and that the Fed’s latest pause will help keep a “fundamentally healthy” economy on track. “There are more people out there who want to work; let’s let the economy continue to strengthen and if we see signs then, wages pick up, inflation picks up, we can always tap the brakes,” Kashkari said on Sunday. “Let’s just not tap the brakes prematurely,” he said.
DECOUPLING? In a sign of deeper US-China technology decoupling, Apple has held initial talks about using Baidu’s generative AI technology in its iPhones, the Wall Street Journal said China has introduced guidelines to phase out US microprocessors from Intel Corp and Advanced Micro Devices Inc (AMD) from government PCs and servers, the Financial Times reported yesterday. The procurement guidance also seeks to sideline Microsoft Corp’s Windows operating system and foreign-made database software in favor of domestic options, the report said. Chinese officials have begun following the guidelines, which were unveiled in December last year, the report said. They order government agencies above the township level to include criteria requiring “safe and reliable” processors and operating systems when making purchases, the newspaper said. The US has been aiming to boost domestic semiconductor
Nvidia Corp earned its US$2.2 trillion market cap by producing artificial intelligence (AI) chips that have become the lifeblood powering the new era of generative AI developers from start-ups to Microsoft Corp, OpenAI and Google parent Alphabet Inc. Almost as important to its hardware is the company’s nearly 20 years’ worth of computer code, which helps make competition with the company nearly impossible. More than 4 million global developers rely on Nvidia’s CUDA software platform to build AI and other apps. Now a coalition of tech companies that includes Qualcomm Inc, Google and Intel Corp plans to loosen Nvidia’s chokehold by going
ENERGY IMPACT: The electricity rate hike is expected to add about NT$4 billion to TSMC’s electricity bill a year and cut its annual earnings per share by about NT$0.154 Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) has left its long-term gross margin target unchanged despite the government deciding on Friday to raise electricity rates. One of the heaviest power consuming manufacturers in Taiwan, TSMC said it always respects the government’s energy policy and would continue to operate its fabs by making efforts in energy conservation. The chipmaker said it has left a long-term goal of more than 53 percent in gross margin unchanged. The Ministry of Economic Affairs concluded a power rate evaluation meeting on Friday, announcing electricity tariffs would go up by 11 percent on average to about NT$3.4518 per kilowatt-hour (kWh)
OPENING ADDRESS: The CEO is to give a speech on the future of high-performance computing and artificial intelligence at the trade show’s opening on June 3, TAITRA said Advanced Micro Devices Inc (AMD) chairperson and chief executive officer Lisa Su (蘇姿丰) is to deliver the opening keynote speech at Computex Taipei this year, the event’s organizer said in a statement yesterday. Su is to give a speech on the future of high-performance computing (HPC) in the artificial intelligence (AI) era to open Computex, one of the world’s largest computer and technology trade events, at 9:30am on June 3, the Taiwan External Trade Development Council (TAITRA) said. Su is to explore how AMD and the company’s strategic technology partners are pushing the limits of AI and HPC, from data centers to