RETAIL
UK sales post surprise slump
Retail sales unexpectedly fell last month as Black Friday failed to deliver its usual boost, deepening the cost-of-living crisis engulfing the sector. The volume of goods sold in shops and online fell 0.4 percent, the British Office for National Statistics said yesterday. Sales excluding vehicle fuel fell 0.3 percent. Economists expected a 0.3 percent gain on both measures. The data underscore concerns that the UK is already in recession, as the Bank of England believes. Consumer spending accounts for two-thirds of national output and is key for growth. Separate figures yesterday showed that consumer confidence continued to linger near its lowest levels for at least half a century.
MULTINATIONALS
GE production site searched
Prosecutors searched US conglomerate General Electric Co’s (GE) industrial site in eastern France on Thursday as part of an inquiry into claims it avoided millions of euros in taxes by transferring profits abroad. The tax inquiry was started after French Communist Party Chairman Fabien Roussel in 2019 told authorities of his “suspicions of tax optimization and fraud” by the company, the report said. Tensions between unions and the firm’s management have run high as it cut hundreds of jobs on slumping demand for gas turbines and other power-generation equipment, the report added. In 2019, GE announced a plan to cut about 1,000 local jobs, principally at its site in Belfort. The works’ council and unions at the site in May last year filed a complaint saying the firm had transferred 555 million euros (US$589.2 million) from the Belfort site to Switzerland or the US.
ENERGY
California cuts solar perks
California is to sharply reduce an incentive that encouraged more than 1 million homeowners and businesses to install rooftop solar panels, and cemented the state as a green energy pioneer. State regulators on Thursday unanimously voted to cut the compensation homeowners get for their systems’ excess electricity by about 75 percent. The existing program pays solar customers the full retail electricity price for that excess power, a perk that some state officials say disproportionately hurts low-income residents who are less likely to own solar panels. The decision is a blow to rooftop installers and financiers — and risks slowing the growth of an industry that California Governor Gavin Newsom has called “essential to California’s future.” This year, the state is to account for about one-third of all US residential capacity installed.
EUROPEAN UNION
Minimum tax plan adopted
The EU on Thursday adopted a plan for a global minimum 15 percent tax on multinational businesses, after leaders gave final approval following months of wrangling. The landmark agreement between nearly 140 countries is intended to stop governments racing to cut taxes to lure the world’s richest firms to their territory. “Today the European Union has taken a crucial step toward tax fairness and social justice,” European Commissioner for Economy Paolo Gentiloni said. “Minimum taxation is key to addressing the challenges a globalized economy creates,” he said. The plan was drawn up under the guidance of the Organisation for Economic Cooperation and Development and already had the backing of Washington and several major EU economies. However, the implementation of the minimum tax in the 27-nation EU had been delayed as member states raised objections or adopted blocking tactics.
BUSINESS UPDATE: The iPhone assembler said operations outlook is expected to show quarter-on-quarter and year-on-year growth for the second quarter Hon Hai Precision Industry Co (鴻海精密) yesterday reported strong growth in sales last month, potentially raising expectations for iPhone sales while artificial intelligence (AI)-related business booms. The company, which assembles the majority of Apple Inc’s smartphones, reported a 19.03 percent rise in monthly sales to NT$510.9 billion (US$15.78 billion), from NT$429.22 billion in the same period last year. On a monthly basis, sales rose 14.16 percent, it said. The company in a statement said that last month’s revenue was a record-breaking April performance. Hon Hai, known also as Foxconn Technology Group (富士康科技集團), assembles most iPhones, but the company is diversifying its business to
ARTIFICIAL INTELLIGENCE: The chipmaker last month raised its capital spending by 28 percent for this year to NT$32 billion from a previous estimate of NT$25 billion Contract chipmaker Powerchip Semiconductor Manufacturing Corp (力積電子) yesterday launched a new 12-inch fab, tapping into advanced chip-on-wafer-on-substrate (CoWoS) packaging technology to support rising demand for artificial intelligence (AI) devices. Powerchip is to offer interposers, one of three parts in CoWoS packaging technology, with shipments scheduled for the second half of this year, Powerchip chairman Frank Huang (黃崇仁) told reporters on the sidelines of a fab inauguration ceremony in the Tongluo Science Park (銅鑼科學園區) in Miaoli County yesterday. “We are working with customers to supply CoWoS-related business, utilizing part of this new fab’s capacity,” Huang said, adding that Powerchip intended to bridge
Microsoft Corp yesterday said that it would create Thailand’s first data center region to boost cloud and artificial intelligence (AI) infrastructure, promising AI training to more than 100,000 people to develop tech. Bangkok is a key economic player in Southeast Asia, but it has lagged behind Indonesia and Singapore when it comes to the tech industry. Thailand has an “incredible opportunity to build a digital-first, AI-powered future,” Microsoft chairman and chief executive officer Satya Nadella said at an event in Bangkok. Data center regions are physical locations that store computing infrastructure, allowing secure and reliable access to cloud platforms. The global embrace of AI
Qualcomm Inc, the world’s biggest seller of smartphone processors, gave an upbeat forecast for sales and profit in the current period, suggesting demand for handsets is increasing after a two-year slump. Revenue in the three months ended in June will be US$8.8 billion to US$9.6 billion, the company said in a statement Wednesday. Excluding certain items, earnings will be US$2.15 to US$2.35 a share. Analysts had projected sales of US$9.08 billion and earnings of US$2.16 a share. The outlook signals that the smartphone market has begun to bounce back, tracking with Qualcomm’s forecast that demand would gradually recover this year. The San