Entegris Inc, a supplier of advanced materials and process solutions for the semiconductor and other high-technology industries, yesterday said that it is expanding its investment in a new advanced manufacturing facility in Kaohsiung to about US$500 million over the next three years. The investment is more than double the US$200 million the US firm announced in December last year. The new facility at the Southern Taiwan Science Park’s (南部科學工業園) Kaohsiung section in Lujhu District (路竹) would cover 54,000m2, up from the originally planned 27,000m2, it said in a statement. EXPANDING WORKFORCE Entegris expects to hire about 100 new employees next year to add to its existing workforce of more than 300. The new facility is expected to generate about US$500 million in annual revenue when fully operational, it said. “This expansion of our manufacturing presence demonstrates our commitment to Taiwan and to supporting the continued growth of Taiwan’s semiconductor ecosystem,” Entegris president and CEO Bertrand Loy said in the statement. While the new facility would support all three of the company’s divisions, the lead tenant would be Entegris’ microcontamination control business, the statement said. Customer qualifications are expected to take place toward the end of next year or early 2023, with the first liquid filtration solutions expected to be sold in the first half of 2023. The Kaohsiung facility — the company’s largest global manufacturing site — would be supported by the expanded Taiwan Technology Center for Research and Development in Hsinchu, Entegris’ largest and most active research and development center. TECH CENTER The company is investing about US$11 million in the technology center, increasing its size from about 730m2 to 1,740m2. Engineers at the manufacturing facility and technology center would collaborate closely with customers to ensure continued alignment and support their evolving needs, it said. “Growing our capabilities in Taiwan will further position Entegris to respond to
The central bank is expected to tighten selective credit controls for a third time at its quarterly meeting next week, as the property market continues to heat up, the chief economists at Cathay United Bank (國泰世華銀行) and SinoPac Financial Holdings Co (永豐金控) said yesterday. Rising housing prices are a greater concern for the bank, taking precedence over inflation or the New Taiwan dollar’s exchange rate, Cathay United Bank chief economist Lin Chi-chao (林啟超) told a meeting in Taipei. “Surging housing prices have prompted widespread criticism, with mortgages and construction loans combined hitting a record NT$11 trillion [US$396.51 billion], about 54 percent of Taiwan’s GDP. The bank is likely to strengthen credit controls further to address these phenomena,” Lin said. The credit controls are forecast to remain in effect for one more year, and they would only become more stringent, he added. SinoPac Financial chief economist Jack Huang (黃蔭基) agreed, saying that the central bank is expected to maintain benchmark interest rates unchanged, but might tighten its grip on mortgages at its quarterly policymaking meeting on Thursday next week. SinoPac Financial is sticking to its forecast that the central bank would not hike benchmark rates until the fourth quarter of next year, Huang said. However, the central bank should raise interest rates sooner, as rising inflation would slow consumption, he said. The central bank implemented selective credit controls in December last year and added new measures in March and September to cap the loan-to-value ratio and bar banks from granting grace periods to buyers of a second house in several major cities. Rising inflation worldwide is not likely to ease soon, as it is partly caused by high shipping rates amid congestion at global ports, which might persist in the near term, Lin said. The central bank might raise interest rates by 25 basis points in the second
ROOM FOR IMPROVEMENT: Information in English is not sufficient and existing systems are not adequately digitized, the trade group’s annual discussion paper said
Most Australian and New Zealand companies find it difficult to do business in Taiwan given a lack of English proficiency and inadequate digitization, the Australia New Zealand Chamber of Commerce (ANZCham) in Taipei said in its annual discussion paper. Only 38 percent of respondents said it is easy for a foreign company to enter the local market and do business, compared with more than 50 percent who said they disagreed. The survey is part of the discussion paper ANZCham released on Tuesday to call for deregulation and strengthening of trade ties between Australia, New Zealand and Taiwan. The chamber welcomed the Taiwanese government’s promotion of a bilingual policy, with respondents saying that information in English is not sufficient and existing systems are not adequately digitized, especially with regard to the banking system. More than 50 percent of respondents said that laws and regulations are lacking in flexibility and information is not sufficient or clear enough, the survey said. In particular, 44 percent said there is not enough information on free-trade zones, it showed. Despite the challenges, 44 percent said the Taiwanese government was receptive and supportive in listening to their operational difficulties. A large majority, 69 percent, said that foreigners working and living in Taiwan do not have difficulty integrating into the local society, despite the language divide. Twenty-five percent said it is not easy for expat children to join international schools in Taiwan. Trade between Taiwan and Australia saw a significant retreat last year due to the COVID-19 pandemic, as evidenced by a 20 percent drop in imports from Australia and flat exports, the paper said. Things improved a lot in the first half of this year, with imports and exports from Taiwan spiking 48 percent and 30 percent after Australia gradually emerged from the negative impact of the COVID-19 outbreak and lockdowns, it said. Taiwan’s top exports
Nearly half of local corporate and human resource managers are positive about Taiwan’s economy next year, boding well for hiring activity ahead, a survey by the online 104 Job Bank (104人力銀行) showed yesterday. Forty-two percent of corporate and human resource officials are looking at a continued improvement in the economy and job market next year, way higher than 15 percent of peers with negative views, according to the survey that polled 2,739 respondents from Oct. 26 to Nov. 23. The rosy sentiment, coupled with a record high of 897,000 openings for this month, bodes well for the job market ahead of the high season for switching jobs, it said, adding that discontented workers tend to hand in resignations after receiving their year-end bonuses. There was no resignation wave last year and this year because the COVID-19 pandemic created significant job losses and workers believed it would be better to stay on for the meantime. Most job vacancies are linked to the themes of electric vehicles, 5G and the metaverse, and concentrated in the electronics, information, software and semiconductor sectors, 104 said. Hotels and restaurants also demonstrated a strong intention to hire more workers, it said. The outbreak and containment measures continued to weigh on the local job market, with 25,000 people still working fewer hours, data provided by the Directorate-General of Budget, Accounting and Statistics showed. The statistics agency last month projected a 4.5 percent GDP growth for next year, slowing from an estimated 6.09 percent increase this year.
CONFIDENCE CRISIS: It is the second time in the past month that the debt-ridden firm has suspended trading and comes on the heels of China Evergrande missing a payment
Chinese property firm Kaisa Group Holdings Ltd (佳兆業集團) yesterday suspended share trading in Hong Kong as questions swirl over its ability to make repayments and contagion spreads within the nation’s debt-ridden real-estate sector. Kaisa, China’s 27th-largest real-estate firm in terms of sales, but one of its most indebted, became the latest company to spook investors when it announced on Friday that it had failed in a bid for a debt swap that would buy it crucial time. Yesterday morning the firm announced that it was suspending trading in Hong Kong, where it is listed, “pending the release by the company of an announcement containing inside information.” It is the second time the company has suspended trading in the past month. Kaisa last month announced a plan to delay the repayment timeline for some of its bonds, offering an exchange for at least US$380 million of notes, which would have given it some room to find money further down the line. However, the offer failed to win the 95 percent approval from bondholders needed for the plan to go ahead. The company currently has about US$11.6 billion of US dollar notes outstanding. It had defaulted on a US dollar debt in 2015, becoming the first Chinese developer to do so. The most indebted Chinese property firm is China Evergrande Group (恆大集團), which set off the current confidence crisis earlier in the summer. The Shenzhen-based behemoth racked up an eye-watering US$300 billion in loans before Beijing began to rein in the sector. On Tuesday, Evergrande missed a deadline to repay some of its overseas creditors, raising the prospect of it defaulting as it prepares for a government-backed mega-restructure. Bloomberg News reported some of the US$82.5 million in overdue coupon payments it owed by the end of Tuesday — when a 30-day grace period ran out — remained unpaid. Ratings group S&P has
COVID-19 RESURGENCE: The economy declined 3.6% in the third quarter, lower than a preliminary estimate of 3%, mainly due to a sharp fall in private consumption
The Japanese economy shrank slightly faster than initially reported in the third quarter, as a sharp rise in local COVID-19 cases hit private consumption and a global chip supply shortage hurt corporate sentiment. The economy declined an annualized 3.6 percent from July to September, revised Japanese Cabinet Office data showed yesterday, worse than the preliminary reading of a 3 percent contraction. The data, which was worse than economists’ median forecast of a 3.1 percent drop, equals a real quarter-on-quarter contraction of 0.9 percent from the prior quarter, versus a preliminary decline of 0.8 percent. “This confirms that economic conditions were stagnating in the July-September quarter,” Itochu Economic Research Institute chief economist Atsushi Takeda said. “Growth turned negative due to the resurgence of the coronavirus.” The faster decline was mainly due to a larger fall in private consumption, which makes up more than half of GDP, and shrank 1.3 percent from the previous three months, worse than the initial estimate of a 1.1 percent drop. Consumption fell as bad weather kept shoppers at home, and a global chip shortage hit sales of vehicles and electronics due to production snags, a government official said. Durable goods spending posted its biggest drop since 1994, when comparable data first became available, the official said, slumping 16.3 percent quarter-on-quarter and pulling down household consumption by 0.7 percentage points. The data showed public investment dropped 2 percent versus the initial estimate of a 1.5 percent decline, while capital spending saw a smaller fall, shrinking 2.3 percent from the prior quarter, compared with a 3.8 percent preliminary drop. The net contribution of exports to the GDP change was zero, offset by imports. Meanwhile, domestic demand pulled GDP down by 0.9 percentage points, matching a preliminary contribution. The GDP downgrade, which took into account a change in the way seasonal adjustments were calculated, comes after data on
India’s central bank yesterday kept borrowing costs at a record-low for the ninth straight meeting, amid concern over the Omicron variant of SARS-CoV-2 posing renewed risks to economic recovery globally. The Monetary Policy Committee (MPC) voted to keep the benchmark repurchase rate at 4 percent, as predicted by all 35 economists surveyed by Bloomberg. The six-member panel voted 5-1 to retain its accommodative policy stance as long as is necessary, reflecting a continued bias to support economic growth given inflation is within target. “Our motto is to ensure soft landing that is well timed,” Reserve Bank of India Governor Shaktikanta Das said in a live Web cast. The central bank also kept the reverse repo rate — the level at which it absorbs excess cash from lenders — unchanged at 3.35 percent, he said, in his first policy speech after being reappointed for a second three-year term. With infections from the Omicron variant spreading fast, several nations are weighing varied degrees of pandemic controls that could throttle demand. “The MPC regarded the accentuation of headwinds emanating from global developments as the main risk to domestic outlook, which is now somewhat clouded by the Omicron variant of the COVID-19,” Das said. “Given the slack in the economy and the ongoing catching up of activity, especially of private consumption, which is still below its pre-pandemic levels, continued policy support is warranted for a durable and broad-based recovery.”
By many counts, this year was the year cryptocurrencies were finally embraced by institutions. Now those same money managers say the asset class is ripe for a big sell-off next year. Digital assets are the “top contender” for a “major correction” next year, with nearly three-quarters of institutions polled saying they are not an appropriate investment for most retail investors, a survey done for Natixis Investment Managers showed. Meanwhile, 28 percent of all institutions surveyed currently invest in cryptocurrencies, of which nearly one-third said they plan to increase their crypto allocations next year. Overall, 8 percent of all institutional investors surveyed — meaning all those who do and do not currently invest in digital assets — plan to increase their allocations next year. The combined total of assets managed by respondents clocks in at US$12.3 trillion. This year saw a number of big fund managers and pensions start to dabble in crypto, while numerous big-name investors famed for their financial markets acumen have also gotten involved. Many said digital assets like bitcoin could act as good inflation hedges amid a stimulus-heavy environment. Although crypto is very volatile, it is not unheard of for different tokens to post huge gains. An index of the largest cryptocurrencies — the Bloomberg Galaxy Crypto Index — added about 200 percent so far this year. In Natixis’ survey, about 40 percent said they recognize cryptocurrencies as a legitimate investment option, although central banks will eventually need to regulate them. Dire predictions for its demise have been a constant for bitcoin, the largest and original cryptocurrency, since its debut a little more than a decade ago. Most have been to little avail. Since breaking into the mainstream consciousness, bitcoin has jumped more than 5,000 percent over the past five years. The survey from Natixis was conducted by CoreData Research in October and last month,
FRANCE Bank upbeat on economy Economic activity is forecast to continue rising this month, despite another wave of the COVID-19 pandemic, the Bank of France said. Completed at the end of last week, the central bank’s monthly survey of 8,500 firms is the first indicator of how businesses in the eurozone’s second-largest economy are faring since the Omicron variant of SARS-CoV-2 emerged. Based on their responses, the institution estimates economic activity was 0.5 percent above pre-crisis levels last month and would be 0.75 percent higher this month. That means output for the whole fourth quarter would also expand by almost 0.75 percent. The central bank, which is scheduled to announce fresh estimates on Dec. 20, in September predicted GDP would increase 6.3 percent this year. COSMETICS Nestle sells L’Oreal shares Swiss food giant Nestle on Tuesday said it was reducing its stake in French cosmetics group L’Oreal, selling 8.9 billion euros (US$10 billion) of shares. Nestle said in a statement that 22.26 million of its L’Oreal shares were sold for 400 euros each, adding that it “remains fully supportive” of the French company’s “value creation strategy.” L’Oreal said in a separate statement that it would cancel the shares, which represent 4 percent of its capital. The French group’s shareholders would see their shareholdings increase due to the buyback, L’Oreal said, adding that the stake of L’Oreal’s Bettencourt Meyers family shareholders would rise from 33.3 percent to 34.7 percent. CRYPTOCURRENCIES Binance invests in HGX Binance Asia Services Pte Ltd (幣安亞洲服務), the Singapore entity of Changpeng Zhao (趙長鵬), said it has invested in a regional private securities exchange called Hg Exchange (HGX) that gives it a post-money stake of 18 percent. Financial offerings in the traditional form and cryptoassets are converging, Binance Singapore CEO Richard Teng said in a statement yesterday. A post-money valuation is the firm’s
‘IMPRESSIVE’: The data are surprising and would remain strong this month, due partly to holiday demand and delayed shipments, a Ministry of Finance official said
Exports last month surged 30.2 percent year-on-year to a record US$41.58 billion, as a global recovery propped up demand in almost all product categories and selling prices increased, the Ministry of Finance said yesterday. Outbound shipments might again top US$40 billion this month, making the current quarter the strongest in history as the COVID-19 pandemic and digital transformation reshape consumer behavior and product supply chains, Department of Statistics Director-General Beatrice Tsai (蔡美娜) told a news conference in Taipei. Last month’s “export data are surprisingly impressive and would remain strong this month,” Tsai said, adding that exporters hiked selling prices to reflect rising raw material costs. The unprecedented showing also had to do with holiday demand and delayed shipments from previous months, Tsai said. Electronics shipments grew 26.6 percent to US$15.93 billion, while exports of information and communications technology products gained 19.5 percent to US$5.69 billion, the ministry’s monthly report said. Several electronics suppliers have said that they have more orders than they can digest due to component shortages and chaos in the shipping sector. Exports picked up across the world as rising COVID-19 vaccination rates gave countries confidence to lift lockdowns. That explained why shipments to Europe swelled 56 percent and inflated 39.2 percent to the US, the report said. Exports to ASEAN markets jumped 31.2 percent and rose 29.1 percent to Japan, it said. China also increased purchases of Taiwanese goods by 18.9 percent year-on-year, it said. However, shipments of optical devices dropped 3 percent, although domestic flat-panel providers said that seasonal price corrections would soon end. Exports of non-tech products advanced 20 to 164.6 percent, as price hikes benefited mineral products the most, the report said. Formosa Plastics Group (台塑集團), Taiwan’s largest industrial conglomerate, this week said that sales would weaken in the next three months, with the Lunar New Year to cut working hours and uncertainty escalating due to
‘NO INFLATION’: A DGBAS official said that prices are likely to taper off, as tariffs on imported beef, wheat, cement and other items have been brought down
Consumer prices last month rose 2.84 percent from a year earlier to the highest in nearly nine years with almost every consumption category becoming more expensive amid soaring fuel and food prices, the Directorate-General of Budget, Accounting and Statistics (DGBAS) said yesterday. It is the sixth time this year that the inflationary gauge has exceeded the 2 percent alarm, but the agency reiterated that consumer prices remained stable and would subside this month. “Consumer prices would likely taper off this month after the government lowered tariffs on imported beef, wheat, cement and other items,” DGBAS official Tsao Chih-hung (曹志弘) said. Rising cases of infection with the Omicron variant of SARS-CoV-2 abroad have cast a shadow over the global economy and put a damper on international oil prices, Tsao said. Transportation prices spiked 7.1 percent on the back of a 35.8 percent increase in international fuel prices and a 13.38 percent upswing in domestic airfares, the agency said in a report. Food costs climbed 4.68 percent as bad weather pushed up fruit and vegetable prices by 24.74 and 12.91 percent respectively, with prices for eggs rising 9.53 percent and meat 5.16 percent, the report said. Dining increased 1.65 percent, the steepest in 31 months, as fast-food chains and restaurants announced price hikes to mitigate rising costs, it said. After seasonal adjustments, the CPI inched up 0.56 percent last month. Core CPI, a more reliable long-term price tracker, as it excludes volatile items, grew 1.49 percent, affirming the absence of inflation, Tsao said. Living costs increased 1.6 percent owing to rent hikes and higher home repair costs, the agency said. Entertainment costs advanced 1.55 percent, as travel agencies raised charges amid a recovery in domestic tourism, it said. The wholesale price index (WPI), a measure of production costs, jumped 14.9 percent, easing from a 15.1 percent pickup in October, the DGBAS said. For the
Hon Hai Precision Industry Co (鴻海精密) is to put environmental, social and corporate governance (ESG) considerations into each employee’s key performance indicators, Hon Hai chairman Young Liu (劉揚偉) said at a forum for sustainable finance and climate change yesterday. In addition, the company would earmark 1 percent of its research and development budget to ESG initiatives, Liu said. Hon Hai’s research and development budget is about NT$200 billion (US$7.2 billion) annually, meaning the ESG budget would be about NT$2 billion per year. ESG would be an integral part of Hon Hai’s strategy going forward, Liu said, adding that climate change is the most pressing concern behind its drive. “Extreme climate is a threat to the lives and properties of people all over the world,” Liu said. “Without a market, there is no enterprise.” Hon Hai last year made a commitment to reach net zero carbon emissions by 2050, but some of the firm’s biggest clients have a more aggressive goal of reaching net zero by 2030, he said. To reach its goal, Hon Hai is a part of the Carbon Disclosure Plan and has set up committees to reduce emissions and inspect the carbon footprints of its suppliers. “We hope that ESG is not just a matter of spending money, but encouraging people to feel a sense of pride and participation in making the world a better place,” Liu said.
Solar module maker United Renewable Energy Co (聯合再生能源) yesterday said it aims to develop 30 percent more solar energy capacity totaling 300 megawatts (MW) next year by turning fish ponds and barren farmland into solar power facilities. The Hsinchu-based company attributed the growth to the government’s efforts to shift to renewable energy sources from coal-fired energy by 2025. This year, United Renewable Energy has landed about 400 solar projects with combined capacity of 230MW through collaboration with local governments. The company has won bids to install solar arrays atop rooftops at schools, parking lots, government-owned dormitories, as well as floating panels on fish ponds, it said. As more solar power facilities are to be completed and connected to the electricity grid, United Renewable Energy expects to book income of NT$2.5 billion (US$90.02 million) from selling about 100MW of solar power next year, it said. It is also making inroads into the solar storage segment and is to showcase a shipping container-sized large-capacity modular battery pack at the Energy Taiwan trade show, which starts today and finishes on Friday at the Nangang Exhibition Center’s Hall 2 in Taipei. United Renewable Energy chairman Sam Hong (洪傳獻) called on the government to plan a renewable energy storage policy before the capacity of feeders, deployed by Taiwan Power Co (Taipower, 台電), reaches its limit of 10 gigawatts (GW). Solar power and other forms of renewable energy are interconnected to Taipower’s electricity grids through feeder installations. “With energy storage systems, solar power can ensure stable power supply and play a bigger role in the nation’s electricity supply, rather than being an alternative,” Hong said. The government should offer more incentives — such as tax breaks on equipment investments or boosting feed-in tariffs — to encourage the adoption of energy storage, he said. With just 6.6GW of solar energy capacity deployed so far, Hong said that
Taiwan’s semiconductor development could be in jeopardy if a proposed third liquefied natural gas (LNG) terminal is blocked in a referendum on Saturday next week, Minister of Economic Affairs Wang Mei-hua (王美花) said yesterday. LNG is a key part of Taiwan’s energy transition as a “bridge fuel” on the way to ending electricity generated by burning coal, Wang told an energy outlook forum in Taipei. “People ask me why the third LNG terminal is necessary,” Wang said. “I tell them that without adequate energy, investors cannot build production facilities.” This is especially true for the semiconductor industry, which Wang said is economically and strategically important for Taiwan, but also requires a lot of electricity and water. “We have no choice but to keep cultivating the semiconductor industry,” she said. “The substantial semiconductor supply chain not only contributes to the economy, but to national security. A lot of countries are incentivized to collaborate with Taiwan because of our key role in the global semiconductor supply chain.” Chipmakers, especially when it comes to advanced nodes, are some of the most power-intensive manufacturing facilities, she said. Groups that advocate environmental protection have urged the government to move the planned LNG receiving terminal off Datan Borough (大潭) in Taoyuan’s Guanyin District (觀音) to protect algal reefs in the intertidal zone, even though CPC Corp, Taiwan (台灣中油) has pushed the project further from shore into water at least 18m deep. Environmentalists are not satisfied with the compromise and advocate moving the project to Taipei Harbor. The Ministry of Economic Affairs has said that such a move would take about 11 years.
Visa Taiwan Co (台灣威士卡) is to focus on providing new cross-border payment solutions, issuing debit cards for young people and collaborating with the cryptocurrency sector to boost its competitiveness, general manager Michelle Jao (趙麗芳) said yesterday. As parent Visa Inc has launched a business-to-business (B2B) payment solution — Visa B2B Connect — to facilitate quick cross-border payments using blockchain technology, Visa Taiwan has applied with the Financial Supervisory Commission (FSC) to introduce the service to local businesses, Jao told a media briefing in Taipei. The service, which the commission is reviewing, is available in more than 100 countries, she said. The company plans to issue debit cards to young people, such as university students, as they are generally not ready or eligible to use credit cards, Jao said, citing a survey in July showing that nearly 70 percent of people younger than 23 had never tried non-cash payment tools. “The number was unexpectedly high,” she said. The issuance of debit cards has risen at a double-digit rate this year, Jao said, adding that hopefully more young people would use Visa’s other payment tools as well. Meanwhile, Visa has collaborated with more than 50 crypto wallets or trading platforms worldwide to allow people to buy cryptocurrencies with their Visa cards, Jao said. The value of cryptocurrency-related transactions made with Visa cards surpassed US$1 billion in the first half of this year, she said. In Taiwan, the company would observe how local exchanges conform to new regulations against money laundering and how robust cryptocurrency transactions are before furthering local collaborations, she said. A company survey showed that about 74 percent of respondents had heard of cryptocurrencies, but only 8 percent had invested in them, so the room for growth is substantial, she said. As the central bank plans to develop its own digital currency, Visa Taiwan is studying how it could bridge
Judoka Lee Kai-lin (李凱琳) and table tennis player Cheng Ming-chih (程銘志) on Friday were invited by Citibank Taiwan Ltd (花旗台灣) to speak about their experience as Paralympians. Citibank said it hoped the online meeting between its employees and the athletes would encourage company staff to put more consideration into issues related to mentally and physically challenged people. Citibank said it hoped its staff could be the “strongest supporters” of people with disabilities. The company held the meeting online due to the COVID-19 pandemic, inviting about 100 employees to participate, it said. As part of efforts toward building a culture of inclusiveness and equality, Citibank sponsored 49 athletes at this year’s Tokyo Paralympic Games. Team Citi was a diverse group of male and female athletes from different continents, with ages from 17 to 50, the company said. Silver medalist Lee is from a family of judoka. She has overcome visual impairment to compete at two Paralympics, including the London 2012 Games, where she took home silver for Taiwan. Cheng won silver at the Rio de Janeiro Games in 2016 and was for a time this year the world’s top-ranked player in the TT5 class. Both athletes said that while they felt great pressure to win gold in Tokyo, they focused on implementing their training and told themselves that their opponents would also be nervous, which helped them alleviate their stress. While competing, they strive to overcome their egos, they said. “I feel that Taiwan has been slowly progressing in the past few years on the issue of sports for physically disabled people, but I hope that more people can see us as athletes, not injured people,” Lee said. Lee said she felt many people would assume that judo is not challenging for a blind or deaf person, but in reality she needs to spend more time and energy on training than the
IMPORTS RISE: An analyst said that the surprising number was from contributions of coal, natural gas and crude oil imports to meet the domestic demand for energy
Export growth in China lost some steam last month as holiday demand from abroad faded, official data showed yesterday, but demand for overseas fuel pushed imports above expectations. Exports rose 22 percent year-on-year, better than analysts expected, but below the 27.1 percent growth clocked in October, the latest customs data showed. Despite recent power outages caused by the surging price of coal and supply shortages, factories kept the goods flowing and the power crisis has been winding down. However, experts have warned that the export boom is likely to fade as COVID-19 restrictions ease. A report by ING Groep NV said that Chinese exports likely slowed “given that most orders for Western holiday demand have been fulfilled.” Imports rose an unexpected 31.7 percent — well above the 21.5 percent increase tipped by a Bloomberg consensus poll. “The surprisingly high number comes from contributions of coal, natural gas and crude oil imports ... it’s basically to meet the domestic demand for energy,” Australia & New Zealand Banking Group Ltd senior China strategist Xing Zhaopeng (邢兆鵬) said. Given that China still has limited energy capacity and will need time to build it up, energy-related imports will continue in the coming months, Xing told reporters. China’s total trade surplus was US$71.7 billion last month, down from US$84.5 billion the month before, official data showed. China has an important part to play in the global economy as the pandemic eases, but its growth is slowing, IMF Managing Director Kristalina Georgieva said on Monday. The head of the Washington-based crisis lender held a virtual meeting with Chinese Premier Li Keqiang (李克強) and discussed topics ranging from inflation to the recovery from the pandemic, a statement released by the IMF said. “China achieved a truly remarkable recovery, but its growth momentum has been slowing notably,” Georgieva said. “As China is a vital engine for global growth, taking
The Reserve Bank of Australia (RBA) yesterday left monetary settings unchanged, citing uncertainties from the Omicron strain of SARS-CoV-2, while highlighting positive signs in the labor market and broader economy. The central bank held its key interest rate at a record-low 0.1 percent — as expected — saying that accommodative policy is still needed to push unemployment low enough to drive wages higher. It reiterated that it would not hike until inflation is well within its 2-3 percent target. The bank was more upbeat on the economy’s prospects, saying that Omicron was not expected to derail the recovery and predicting a return to the strong growth trajectory seen before recent lockdowns. RBA Governor Philip Lowe said that vaccination rates against COVID-19 are high in Australia, while there has been a solid rebound in household consumption. Lowe’s statement has economists now seeing a greater chance that the bank would scrap its A$4 billion (US$2.8 billion) a week quantitative easing (QE) program at the first meeting of next year, when it is due to be reviewed. “There is now a clear risk the RBA announces the cessation of the bond buying program in February,” Commonwealth Bank of Australia head of Australian economics Gareth Aird said. His base case is a taper to A$2 billion, but “it’s edging towards a lineball call between them announcing a further taper or exiting QE.” February’s decision would be guided by three considerations: The actions of other central banks, how the Australian bond market is functioning and “most importantly, the actual and expected progress toward the goals of full employment and inflation consistent with the target,” Lowe said. An expected acceleration in tapering by the US Federal Reserve in response to surging US inflation is also expected to be influential in Lowe’s thinking, bond traders said. It would take time for a stronger economy to translate into
Samsung Electronics Co is combining two of its three business divisions and appointing new leaders to replace its three chief executive officers in its biggest management shakeup since 2017. The reorganization, decided under the oversight of de facto leader and Samsung heir Jay Y. Lee, would see its consumer and mobile divisions merged into a newly formed SET Division, to be led by Han Jong-hee. Promoted from the company’s TV research and development team, Han succeeds co-CEOs Dongjin Koh and Hyunsuk Kim, who had led the smartphone and consumer appliances groups respectively. Kyung Kye-hyun is stepping in to lead the company’s Device Solutions group, which encompasses its key semiconductor business lines, such as memory, logic processors and chipmaking, for outside customers. “Today’s announcement shows the company keeps its performance-driven culture,” Seoul National University professor of business management Lee Kyung-mook said. “It also shows Jay Y. Lee’s willingness to more actively engage in management.” Since he was released from prison in August, Jay Y. Lee has gotten involved in major decisions for the company, and recently traveled to the US to conclude and announce plans for a US$17 billion plant in Taylor, Texas. He is currently on a trip to the Middle East, where Samsung Electronics and Samsung C&T Corp are participating in multiple projects. The consolidation of consumer offerings under one umbrella simplifies the company’s operational structure and might help the South Korean electronics giant better compete with US archrival Apple Inc. “Apple uses one OS [operating system] for phones, PCs and TVs, and its products show seamless integration,” Lee Kyung-mook said. “Samsung’s IT products, however, lack such seamless integration between phones and gadgets. The merger between its consumer and mobile divisions, which have until now operated independently, may help fix this issue.” That the merged SET unit is to be overseen by someone from home appliances rather than
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