CHINA
Beijing downplays loan risks
Beijing said yesterday that risks from its local government borrowings were “controllable,” amid fears that bad loans could derail the world’s second-largest economy. Yesterday, the finance ministry admitted there were “potential risks” in some areas of local government borrowing, but said most were under control. The National Audit Office recently put the debt held by authorities at 10.7 trillion yuan (US$1.67 trillion) as of the end of last year, or about 27 percent of GDP last year. Separately, a total of 2.8 trillion yuan in local government debt has been reclassified as loans taken by companies, the state-run China Securities Journal said yesterday, citing an unnamed source.
SINGAPORE
Retail sales accelerate
Retail sales growth accelerated in June as an expanding job market encouraged purchases of luxury goods, telephones and computers. The retail sales index rose 10.9 percent from a year earlier after climbing a revised 9.6 percent in May, the Statistics Department said in a statement yesterday. Adjusted for seasonal factors, overall retail sales rose 1.6 percent in June from May, when they fell a revised 0.8 percent, the report showed.
CONSTRUCTION
Leighton posts huge loss
Leighton Holdings Ltd, Australia’s biggest construction company, has posted an A$409 million (US$426.2 million) loss for fiscal year ending June 30. Leighton said in a statement yesterday the loss was largely due to an airport link that cost the company A$520 million and a desalination plant that cost A$278 million. The result was a major turnaround from the A$612 million profit in the previous year.
TELECOMS
Reliance reports profit dive
India’s second-biggest mobile firm, Reliance Communications, has reported a worse-than-expected 37 percent dive in quarterly net profit as revenues remained under pressure in the competitive sector. The announcement on its Web site on Sunday marked the eighth straight quarterly fall in profit of the flagship Mumbai-based company led by billionaire Anil Ambani. Net profit fell to 1.57 billion rupees (US$34.7 million) for the fiscal first quarter ending June 30, from 2.5 billion rupees for the same period last year, the company said in the statement. Revenues slipped 3.3 percent to 49.4 billion rupees.
SEMICONDUCTORS
Toshiba shares rise
Toshiba Corp’s shares rose the most in seven weeks in Tokyo trading after the Nikkei Shimbun said the company plans to reduce the types of semiconductors used in autos and electronics by half to boost efficiency. The world’s second-largest maker of flash memory chips added 1.49 percent on the Tokyo Stock Exchange, while the benchmark Nikkei 225 Stock Average advanced 1.37 percent to close at 9,086.41.
OIL
Iran receives India payments
Iran has received two-thirds of the oil debts from Indian buyers that had accumulated this year because of a -sanctions-related payments problem, Iranian central bank governor Mahmoud Bahmani told the students’ news agency ISNA yesterday. “Two-thirds of India’s debt to Iran has been paid and the balance is being taken care of and there are no problems in this regard,” he said. Bahmani denied media reports of similar payment problems with China and South Korea and confirmed Iran and India have discussed India paying for some of its oil in gold.
TARIFF TRADE-OFF: Machinery exports to China dropped after Beijing ended its tariff reductions in June, while potential new tariffs fueled ‘front-loaded’ orders to the US The nation’s machinery exports to the US amounted to US$7.19 billion last year, surpassing the US$6.86 billion to China to become the largest export destination for the local machinery industry, the Taiwan Association of Machinery Industry (TAMI, 台灣機械公會) said in a report on Jan. 10. It came as some manufacturers brought forward or “front-loaded” US-bound shipments as required by customers ahead of potential tariffs imposed by the new US administration, the association said. During his campaign, US president-elect Donald Trump threatened tariffs of as high as 60 percent on Chinese goods and 10 percent to 20 percent on imports from other countries.
Taiwanese manufacturers have a chance to play a key role in the humanoid robot supply chain, Tongtai Machine and Tool Co (東台精機) chairman Yen Jui-hsiung (嚴瑞雄) said yesterday. That is because Taiwanese companies are capable of making key parts needed for humanoid robots to move, such as harmonic drives and planetary gearboxes, Yen said. This ability to produce these key elements could help Taiwanese manufacturers “become part of the US supply chain,” he added. Yen made the remarks a day after Nvidia Corp cofounder and chief executive officer Jensen Huang (黃仁勳) said his company and Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) are jointly
United Microelectronics Corp (UMC, 聯電) expects its addressable market to grow by a low single-digit percentage this year, lower than the overall foundry industry’s 15 percent expansion and the global semiconductor industry’s 10 percent growth, the contract chipmaker said yesterday after reporting the worst profit in four-and-a-half years in the fourth quarter of last year. Growth would be fueled by demand for artificial intelligence (AI) servers, a moderate recovery in consumer electronics and an increase in semiconductor content, UMC said. “UMC’s goal is to outgrow our addressable market while maintaining our structural profitability,” UMC copresident Jason Wang (王石) told an online earnings
MARKET SHIFTS: Exports to the US soared more than 120 percent to almost one quarter, while ASEAN has steadily increased to 18.5 percent on rising tech sales The proportion of Taiwan’s exports directed to China, including Hong Kong, declined by more than 12 percentage points last year compared with its peak in 2020, the Ministry of Finance said on Thursday last week. The decrease reflects the ongoing restructuring of global supply chains, driven by escalating trade tensions between Beijing and Washington. Data compiled by the ministry showed China and Hong Kong accounted for 31.7 percent of Taiwan’s total outbound sales last year, a drop of 12.2 percentage points from a high of 43.9 percent in 2020. In addition to increasing trade conflicts between China and the US, the ministry said
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