The top concern for Asia is an expected slowdown in growth in the US, a senior official at Fitch Ratings said yesterday, emphasizing that the region has yet to wean itself away from demand in the world's largest economy.
"The biggest threat that we see to Asian growth going forward is a slowdown in the US, which is something we do expect to happen later this year as higher interest rates start to take hold," James McCormack, Fitch's head of Asia Sovereign Ratings, told reporters.
"Even though China is absorbing more of the rest of Asia's exports [as] the US is absorbing less, a lot of that trade is then finding its way to the US," said Hong Kong-based McCormack, who was visiting Seoul for an investment seminar.
US growth accelerated in the first quarter of this year, growing an annualized 4.8 percent, a sharp rebound from the 1.7 percent recorded in the final three months of last year. US Federal Reserve Chairman Ben Bernanke said he expected growth to moderate in coming quarters.
The IMF predicted last month that the US will grow 3.4 percent this year and 3.3 percent next year, both slightly slower than last year's 3.5 percent.
McCormack cited the example of exports of intermediate goods from countries like South Korea to China, where finished products are assembled and then shipped to the US.
"So China has become a part of a regional manufacturing process," McCormack said.
He added, however, that "final demand in the US is still what matters for Asia."
China, the world's fastest growing major economy, expanded 10.2 percent in the first quarter from the same period last year. The World Bank yesterday raised its forecast for economic growth this year to 9.5 percent from an earlier forecast of 9.2 percent.
But the World Bank urged China to allow its currency to appreciate faster, saying a stronger yuan would help rebalance the nation's trade surplus and ease domestic economic problems.
"Accelerating appreciation [of the yuan] would also help reduce current account surpluses and rebalance growth towards consumption," the World Bank said as it released a quarterly report.
Intel Corp chief executive officer Lip-Bu Tan (陳立武) is expected to meet with Taiwanese suppliers next month in conjunction with the opening of the Computex Taipei trade show, supply chain sources said on Monday. The visit, the first for Tan to Taiwan since assuming his new post last month, would be aimed at enhancing Intel’s ties with suppliers in Taiwan as he attempts to help turn around the struggling US chipmaker, the sources said. Tan is to hold a banquet to celebrate Intel’s 40-year presence in Taiwan before Computex opens on May 20 and invite dozens of Taiwanese suppliers to exchange views
Application-specific integrated circuit designer Faraday Technology Corp (智原) yesterday said that although revenue this quarter would decline 30 percent from last quarter, it retained its full-year forecast of revenue growth of 100 percent. The company attributed the quarterly drop to a slowdown in customers’ production of chips using Faraday’s advanced packaging technology. The company is still confident about its revenue growth this year, given its strong “design-win” — or the projects it won to help customers design their chips, Faraday president Steve Wang (王國雍) told an online earnings conference. “The design-win this year is better than we expected. We believe we will win
Chizuko Kimura has become the first female sushi chef in the world to win a Michelin star, fulfilling a promise she made to her dying husband to continue his legacy. The 54-year-old Japanese chef regained the Michelin star her late husband, Shunei Kimura, won three years ago for their Sushi Shunei restaurant in Paris. For Shunei Kimura, the star was a dream come true. However, the joy was short-lived. He died from cancer just three months later in June 2022. He was 65. The following year, the restaurant in the heart of Montmartre lost its star rating. Chizuko Kimura insisted that the new star is still down
While China’s leaders use their economic and political might to fight US President Donald Trump’s trade war “to the end,” its army of social media soldiers are embarking on a more humorous campaign online. Trump’s tariff blitz has seen Washington and Beijing impose eye-watering duties on imports from the other, fanning a standoff between the economic superpowers that has sparked global recession fears and sent markets into a tailspin. Trump says his policy is a response to years of being “ripped off” by other countries and aims to bring manufacturing to the US, forcing companies to employ US workers. However, China’s online warriors