INDUSTRY
German production falls
German industrial production fell more than expected in March, partly due to a weak performance by the automotive sector, spurring recession fears in Europe’s largest economy. Production decreased by 3.4 percent on the previous month following a slightly revised increase of 2.1 percent in February, the Federal Statistical Office said yesterday. “After a buoyant performance by industrial production at the beginning of the year, there was an unexpectedly sharp decline in March,” the Federal Ministry for Economic Affairs and Climate Action said. The manufacture of motor vehicles and automotive parts fell by 6.5 percent on the previous month. Production in machinery and equipment fell by 3.4 percent, and output in the construction sector decreased by 4.6 percent from a month earlier. In the first quarter, production was 2.5 percent higher than in the final quarter of last year, the statistics office said.
DEBT
Chinese ratio hits 279.7%
The Chinese economy’s debt ratio reached a record high in the first quarter of this year, with bank loans to companies surging as the nation emerged from its “zero COVID-19”policy. The macro leverage ratio — or total debt as a percentage of GDP — soared to 279.7 percent in the first quarter, Bank of China and National Bureau of Statistics data compiled by Bloomberg showed. That was an increase of 7.7 percentage points from the previous quarter, the biggest jump in three years. The debt ratio held by non-financial corporates rose 5.8 percentage points. Leverage ratios for the household and government sectors were each up by about 1 percentage point. The data does not include bank loans to local government financing vehicles.
MINING
Plant gets rules extension
Malaysia granted a six-month extension to Australian miner Lynas Rare Earths Ltd to get its rare earth plant in line with environmental requirements. The deadline for the plant to be radiation-free has been extended to January next year, Science, Technology and Innovation Minister Chang Lih Kang (鄭立慷) said. The Lynas rare earths refinery in Malaysia is the largest outside China, but has been dogged by environmental concerns and community opposition. The government in February issued a new three-year license to Lynas’s plant in the state of Pahang, with one of the conditions requiring that “cracking and leaching” of lanthanide concentrate move to an area outside of Malaysia by July 1. The business unit generates radioactive waste, authorities said.
FINANCE
Venture announces funds
Mitsubishi UFJ Financial Group Inc plans to start two debt funds alongside Liquidity Capital with as much as US$400 million to provide financing for middle and later-stage start-ups in Japan and Europe. The funds would be established under Mars Growth Capital Pte, a joint venture between Japan’s largest bank and the Israeli tech lender, the companies said in a statement. The Japan fund would have a maximum of ￥20 billion (US$14.8 million) and the European fund up to US$250 million, they said. The move is the latest by Japan’s biggest banks to ramp up start-up finance, where they increasingly see potential for new business. Mars Growth Capital, based in Singapore, launched in 2021 and has been providing debt finance to start-ups in Asia and elsewhere.
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday said that its investment plan in Arizona is going according to schedule, following a local media report claiming that the company is planning to break ground on its third wafer fab in the US in June. In a statement, TSMC said it does not comment on market speculation, but that its investments in Arizona are proceeding well. TSMC is investing more than US$65 billion in Arizona to build three advanced wafer fabs. The first one has started production using the 4-nanometer (nm) process, while the second one would start mass production using the
When an apartment comes up for rent in Germany’s big cities, hundreds of prospective tenants often queue down the street to view it, but the acute shortage of affordable housing is getting scant attention ahead of today’s snap general election. “Housing is one of the main problems for people, but nobody talks about it, nobody takes it seriously,” said Andreas Ibel, president of Build Europe, an association representing housing developers. Migration and the sluggish economy top the list of voters’ concerns, but analysts say housing policy fails to break through as returns on investment take time to register, making the
‘SILVER LINING’: Although the news caused TSMC to fall on the local market, an analyst said that as tariffs are not set to go into effect until April, there is still time for negotiations US President Donald Trump on Tuesday said that he would likely impose tariffs on semiconductor, automobile and pharmaceutical imports of about 25 percent, with an announcement coming as soon as April 2 in a move that would represent a dramatic widening of the US leader’s trade war. “I probably will tell you that on April 2, but it’ll be in the neighborhood of 25 percent,” Trump told reporters at his Mar-a-Lago club when asked about his plan for auto tariffs. Asked about similar levies on pharmaceutical drugs and semiconductors, the president said that “it’ll be 25 percent and higher, and it’ll
CHIP BOOM: Revenue for the semiconductor industry is set to reach US$1 trillion by 2032, opening up opportunities for the chip pacakging and testing company, it said ASE Technology Holding Co (日月光投控), the world’s largest provider of outsourced semiconductor assembly and test (OSAT) services, yesterday launched a new advanced manufacturing facility in Penang, Malaysia, aiming to meet growing demand for emerging technologies such as generative artificial intelligence (AI) applications. The US$300 million facility is a critical step in expanding ASE’s global footprint, offering an alternative for customers from the US, Europe, Japan, South Korea and China to assemble and test chips outside of Taiwan amid efforts to diversify supply chains. The plant, the company’s fifth in Malaysia, is part of a strategic expansion plan that would more than triple
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