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Trump's tariff pressure pushes Asia toward American LNG, but at the cost of climate goals

Trump's tariff pressure pushes Asia toward American LNG, but at the cost of climate goals

Japan Today5 days ago
U.S. Secretary of Energy Chris Wright, Secretary of the Interior Doug Burgum and Louisiana Gov. Jeff Landry tour the Venture Global's Plaquemines LNG export facility on March 6, 2025, in Plaquemines, La.
By ANIRUDDHA GHOSAL
Asian countries are offering to buy more U.S. liquefied natural gas in negotiations with the Trump administration as a way to alleviate tensions over U.S. trade deficits and forestall higher tariffs. Analysts warn that strategy could undermine those countries' long-term climate ambitions and energy security.
Buying more U.S. LNG has topped the list of concessions Asian countries have offered in talks with Washington over President Donald Trump's sweeping tariffs on foreign goods. Vietnam's Prime Minister underlined the need to buy more of the super-chilled fuel in a government meeting, and the government signed a deal in May with an American company to develop a gas import hub. JERA, Japan's largest power generator, signed new 20-year contracts last month to purchase up to 5.5 million metric tons of U.S. gas annually starting around 2030.
U.S. efforts to sell more LNG to Asia predate the Trump administration, but they've gained momentum with his intense push to win trade deals.
Liquefied natural gas, or LNG, is natural gas cooled to a liquid form for easy storage and transport that is used as a fuel for transport, residential cooking and heating and industrial processes.
Trump discussed cooperation on a $44 billion Alaska LNG project with South Korea, prompting a visit by officials to the site in June. The U.S. president has promoted the project as a way to supply gas from Alaska's vast North Slope to a liquefication plant at Nikiski in south-central Alaska, with an eye largely on exports to Asian countries while bypassing the Panama Canal Thailand has offered to commit to a long-term deal for American fuel and shown interest in the same Alaska project to build a nearly 810-mile (1,300-kilometer) pipeline that would funnel gas from
The Philippines is also considering importing gas from Alaska while India is mulling a plan to scrap import taxes on U.S. energy shipments to help narrow its trade surplus with Washington.
'Trump has put pressure on a seeming plethora of Asian trading partners to buy more U.S. LNG,' said Tim Daiss, at the APAC Energy Consultancy, pointing out that Japan had agreed to buy more despite being so 'awash in the fuel' that it was being forced to cancel projects and contracts to offload the excess to Asia's growing economies.
'Not good for Southeast Asia's sustainability goals,' he said.
Experts say LNG purchasing agreements can slow adoption of renewable energy in Asia.
Locking into long-term deals could leave countries with outdated infrastructure as the world shifts rapidly toward cleaner energy sources like solar or wind that offer faster, more affordable ways to meet growing power demand, said Indra Overland, head of the Center for Energy Research at the Norwegian Institute of International Affairs.
Building pipelines, terminals, and even household gas stoves creates systems that are expensive and difficult to replace—making it harder to switch to renewables later. 'And you're more likely then to get stuck for longer,' he said.
Energy companies that profit from gas or coal are powerful vested interests, swaying policy to favor their business models, he said.
LNG burns cleaner than coal, but it's still a fossil fuel that emits greenhouse gases and contributes to climate change.
Many LNG contracts include 'take-or-pay' clauses, obliging governments to pay even if they don't use the fuel. Christopher Doleman of the Institute for Energy Economics and Financial Analysis warns that if renewable energy grows fast, reducing the need for LNG, countries may still have to pay for gas they no longer need.
Pakistan is an example. Soaring LNG costs drove up electricity prices, pushing consumers to install rooftop solar panels. As demand for power drops and gas supply surges, the country is deferring LNG shipments and trying to resell excess fuel.
Experts said that although countries are signaling a willingness to import more U.S. LNG, they're unlikely to import enough to have a meaningful impact on U.S. trade deficits.
South Korea would need to import 121 million metric tons of LNG in a year — 50% more than the total amount of LNG the U.S. exported globally last year and triple what South Korea imported, said Doleman. Vietnam — with a trade surplus with the U.S. twice the size of Korea's — would need to import 181 million metric tons annually, more than double what the U.S. exported last year.
Other obstacles stand in the way. The Alaska LNG project is widely considered uneconomic. Both coal and renewable energy in Asia are so much cheaper that U.S. gas would need to cost less than half its current price to compete. Tariffs on Chinese steel could make building building gas pipelines and LNG terminals more expensive, while longstanding delays to build new gas turbines mean new gas power projects may not come online until 2032. Meanwhile, a global glut in LNG will likely drive prices lower, making it even harder for countries to justify locking into long-term deals with the United States at current higher prices.
Committing to long-term U.S. LNG contracts could impact regional energy security at a time of growing geopolitical and market uncertainties, analysts said.
A core concern is over the longterm stability of the U.S. as a trading partner, said Overland. 'The U.S. is not a very predictable entity. And to rely on energy from there is a very risky proposition,' he said.
LNG only contributes to energy security when it's available and affordable, says Dario Kenner of Zero Carbon Analytics.
'That's the bit that they leave out ... But it's pretty important,' he said.
This was the concern during the recent potential disruptions to fuel shipments through the Strait of Hormuz and earlier during the war in Ukraine, when LNG cargoes originally destined for Asia were rerouted to Europe. Despite having contracts, Asian countries like Bangladesh and Sri Lanka were outbid by European buyers.
'Events in Europe, which can seem very far away, can have an impact on availability and prices in Asia,' Kenner said.
Asian countries can improve their energy security and make progress toward cutting carbon emissions by building more renewable energy, he said, noting there is vast room for that given that only about 1% of Southeast Asia's solar and wind potential is being used.
'There are genuine choices to meet rising electricity demand. It is not just having to build LNG,' he said.
Jintamas Saksornchai in Bangkok contributed to this report.
© Copyright 2025 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed without permission.
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Trump and Powell Bicker over Fed Building Renovations as President Ratchets up Pressure Campaign
Trump and Powell Bicker over Fed Building Renovations as President Ratchets up Pressure Campaign

Yomiuri Shimbun

time42 minutes ago

  • Yomiuri Shimbun

Trump and Powell Bicker over Fed Building Renovations as President Ratchets up Pressure Campaign

WASHINGTON (AP) — After months of criticizing Federal Reserve Chair Jerome Powell, President Donald Trump took the fight to the Fed's front door on Thursday, publicly scorning the central bank chief over the ballooning costs of a long-planned building project. Powell pushed back, challenging the president's latest price tag as incorrect. Wearing hard hats and grim faces, standing in the middle of the construction project, Trump and Powell addressed the assembled TV cameras. Trump charged that the renovation would cost $3.1 billion, much higher than the Fed's $2.5 billion figure. Powell, standing next to him, shook his head. The Fed chair, after looking at a paper presented to him by Trump, said the president was including the cost of renovating a separate Fed building, known as the Martin building, that was finished five years ago. The visit represented a significant ratcheting up of the president's pressure on Powell to lower borrowing costs, which Trump says would accelerate economic growth and reduce the government's interest payments. Presidents rarely visit the Fed's offices, though they are just a few blocks from the White House, an example of the central bank's independence from day-to-day politics. 'We have to get the interest rates down,' Trump said later after a short tour, addressing the cameras this time without Powell. 'People are pretty much unable to buy houses.' Trump is likely to be disappointed next week, however, when Fed officials will meet to decide its next steps on interest rates. Powell and other officials have signaled they will likely keep their key rate unchanged at about 4.3%. However, economists and Wall Street investors expect the Fed may start cutting rates in September. The Federal Reserve sets a short-term interest rate that influences other borrowing costs, such as mortgages, auto loans and credit card rates. Yet the Fed doesn't directly control those other rates, which are ultimately set in financial markets. Last September, when the Fed cut its rate a half-point, mortgage rates actually rose in response. Trump did step back a bit from some of his recent threats to fire Powell before his term ends May 26. Asked if the rising costs of the Fed's renovation, estimated in 2022 to cost $1.9 billion, was a 'fireable offense,' Trump said, 'I don't want to put this in that category.' 'To do that is a big move, and I don't think that's necessary,' Trump added. 'I just want to see one thing happen, very simple: Interest rates come down.' And on his Truth Social site, Trump said, 'The cost overruns are substantial but, on the positive side, our Country is doing very well and can afford just about anything — Even the cost of this building!' The Fed allowed reporters to tour the building before the visit by Trump, who, in his real estate career, bragged about his own lavish spending on architectural accoutrements that gave a Versailles-like golden flair to his buildings. Journalists get rare tour of Fed renovation On Thursday, reporters wound through cement mixers, front loaders and plastic pipes as they got a close-up view of the active construction site that encompasses the Fed's historic headquarters, known as the Marriner S. Eccles building, and a second building across 20th Street in Washington. Fed staff, who declined to be identified, said that greater security requirements, rising materials costs and tariffs, and the need to comply with historic preservation measures drove up the cost of the project, which was budgeted in 2022 at $1.9 billion. Trump in 2018 imposed a 25% duty on steel and 10% on aluminum. He increased them this year to 50%. Steel prices are up about 60% since the plans were approved, while construction materials costs overall are up about 50%, according to government data. The staff pointed out new blast-resistant windows and seismic walls that were needed to comply with modern building codes and security standards set out by the Department of Homeland Security. The Fed has to build with the highest level of security in mind, Fed staff said, including something called 'progressive collapse,' in which only parts of the building would fall if hit with explosives. Sensitivity to the president's pending visit among Fed staff was high during the tour. Reporters were ushered into a small room outside the Fed's boardroom, where 19 officials meet eight times a year to decide whether to change short-term interest rates. The room, which will have a security booth, is oval-shaped, and someone had written 'oval office' on plywood walls. The Fed staff downplayed the inscription as a joke. When reporters returned to the room later, it had been painted over. During the tour, Fed staff also showed the elevator shaft that congressional critics have said is for 'VIPs' only. Powell has since said it will be open to all Fed staff. The renovation includes an 18-inch (45-cm) extension so the elevator reaches a slightly elevated area that is now accessible only by steps or a ramp. A planning document that said the elevator will only be for the Fed's seven governors was erroneous and later amended, staff said. Renovations have been in the works for a while Plans for the renovation were first approved by the Fed's governing board in 2017. The project then wended its way through several local commissions for approval, at least one of which, the Commission for Fine Arts, included several Trump appointees. The commission pushed for more marble in the second of the two buildings the Fed is renovating, known as 1951 Constitution Avenue, specifically in a mostly glass extension that some of Trump's appointees derided as a 'glass box.' Fed staff also pointed to the complication of historic renovations — both buildings have significant preservation needs. Constructing a new building on an empty site would have been cheaper, they said. As one example, the staff pointed reporters to where they had excavated beneath the Eccles building to add a floor of mechanical rooms, storage space and some offices. The Fed staff acknowledged such structural additions underground are expensive, but said it was done to avoid adding HVAC equipment and other mechanics on the roof, which is historic. Trump, who said after his tour that 'it feels very good to be back on a construction site,' added that opening up a basement is 'the most expensive place to build.' The Fed has previously attributed much of the project's cost to underground construction. It is also adding three underground levels of parking for its second building. Initially the central bank proposed building more above ground, but ran into Washington, D.C.'s height restrictions, forcing more underground construction.

Trump's order to block 'woke' AI in government encourages tech giants to censor their chatbots
Trump's order to block 'woke' AI in government encourages tech giants to censor their chatbots

The Mainichi

time2 hours ago

  • The Mainichi

Trump's order to block 'woke' AI in government encourages tech giants to censor their chatbots

(AP) -- Tech companies looking to sell their artificial intelligence technology to the federal government must now contend with a new regulatory hurdle: prove their chatbots aren't "woke." President Donald Trump's sweeping new plan to counter China in achieving "global dominance" in AI promises to cut regulations and cement American values into the AI tools increasingly used at work and home. But one of Trump's three AI executive orders signed Wednesday -- the one "preventing woke AI in the federal government" -- also mimics China's state-driven approach to mold the behavior of AI systems to fit its ruling party's core values. Several leading providers of the AI language models targeted by the order -- products like Google's Gemini, Microsoft's Copilot -- have so far been silent on Trump's anti-woke directive, which still faces a study period before it gets into official procurement rules. While the tech industry has largely welcomed Trump's broader AI plans, the anti-woke order forces the industry to leap into a culture war battle -- or try their best to quietly avoid it. "It will have massive influence in the industry right now," especially as tech companies "are already capitulating" to other Trump administration directives, said civil rights advocate Alejandra Montoya-Boyer, senior director of The Leadership Conference's Center for Civil Rights and Technology. The move also pushes the tech industry to abandon years of work to combat the pervasive forms of racial and gender bias that studies and real-world examples have shown to be baked into AI systems. "First off, there's no such thing as woke AI," she said. "There's AI technology that discriminates and then there's AI technology that actually works for all people." Molding the behaviors of AI large language models is challenging because of the way they're built. They've been trained on most of what's on the internet, reflecting the biases of all the people who've posted commentary, edited a Wikipedia entry or shared images online. "This will be extremely difficult for tech companies to comply with," said former Biden official Jim Secreto, who was deputy chief of staff to U.S. Secretary of Commerce Gina Raimondo, an architect of many of Biden's AI industry initiatives. "Large language models reflect the data they're trained on, including all the contradictions and biases in human language." Tech workers also have a say in how they're designed, from the global workforce of annotators who check their responses to the Silicon Valley engineers who craft the instructions for how they interact with people. Trump's order targets those "top-down" efforts at tech companies to incorporate what it calls the "destructive" ideology of diversity, equity and inclusion into AI models, including "concepts like critical race theory, transgenderism, unconscious bias, intersectionality, and systemic racism." For Secreto, the order resembles China's playbook in "using the power of the state to stamp out what it sees as disfavored viewpoints." The method is different, with China relying on direct regulation through its Cyberspace Administration, which audits AI models, approves them before they are deployed and requires them to filter out banned content such as the bloody Tiananmen Square crackdown on pro-democracy protests in 1989. Trump's order doesn't call for any such filters, relying on tech companies to instead show that their technology is ideologically neutral by disclosing some of the internal policies that guide the chatbots. "The Trump administration is taking a softer but still coercive route by using federal contracts as leverage," Secreto said. "That creates strong pressure for companies to self-censor in order to stay in the government's good graces and keep the money flowing." The order's call for "truth-seeking" AI echoes the language of the president's one-time ally and adviser Elon Musk, who frequently uses that phrase as the mission for the Grok chatbot made by his company xAI. But whether Grok or its rivals will be favored under the new policy remains to be seen. Despite a "rhetorically pointed" introduction laying out the Trump administration's problems with DEI, the actual language of the order's directives shouldn't be hard for tech companies to comply with, said Neil Chilson, a Republican former chief technologist for the Federal Trade Commission. 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Much of their ire centered on Google's February 2024 release of an AI image-generating tool that produced historically inaccurate images before the tech giant took down and fixed the product. Google later explained that the errors -- including one user's request for American Founding Fathers that generated portraits of Black, Asian and Native American men -- was the result of an overcompensation for technology that, left to its own devices, was prone to favoring lighter-skinned people because of pervasive bias in the systems. Trump allies alleged that Google engineers were hard-coding their own social agenda into the product, and made it a priority to do something about it. "It's 100% intentional," said prominent venture capitalist and Trump adviser Marc Andreessen on a podcast in December. "That's how you get Black George Washington at Google. There's override in the system that basically says, literally, 'Everybody has to be Black.' Boom. There's squads, large sets of people, at these companies who determine these policies and write them down and encode them into these systems." Sacks credited a conservative strategist for helping to draft the order. "When they asked me how to define 'woke,' I said there's only one person to call: Chris Rufo. And now it's law: the federal government will not be buying WokeAI," Sacks wrote on X.

Trump presses Powell to cut rates during tense visit to Fed
Trump presses Powell to cut rates during tense visit to Fed

Nikkei Asia

time2 hours ago

  • Nikkei Asia

Trump presses Powell to cut rates during tense visit to Fed

WASHINGTON (Reuters) -- President Donald Trump locked horns with Federal Reserve Chair Jerome Powell during a rare presidential visit to the U.S. central bank on Thursday, criticizing the cost of renovating two historical buildings at its headquarters and pressing the case for lower interest rates. Trump, who called Powell a "numbskull" earlier this week for failing to heed the White House's demand for a large reduction in borrowing costs, wrapped up his visit to the Fed's $2.5 billion building project in Washington by saying he did not intend to fire Powell, as he has frequently suggested he would. "To do so is a big move and I just don't think it's necessary," Trump told reporters after the visit. In a post on his Truth Social media site, Trump later said of the renovation, "it is what it is and, hopefully, it will be finished ASAP. The cost overruns are substantial but, on the positive side, our Country is doing very well and can afford just about anything." The visibly tense interaction at the Fed's massive construction site marked an escalation of White House pressure on the central bank and Trump's efforts to get Powell to "do the right thing" on rates. It happened less than a week before the central bank's 19 policymakers are due to gather for a two-day rate-setting meeting, where they are widely expected to leave their benchmark interest rate in the 4.25%-4.5% range. The president has repeatedly demanded that Powell slash rates by 3 percentage points or more. "I'd love him to lower interest rates," Trump said as he wrapped up the tour, as Powell stood by, his face expressionless. Powell typically spends the Thursday afternoon before a rate-setting meeting doing back-to-back calls with Fed bank presidents as part of his preparations for the session. His encounter with the president became heated as Trump told reporters the project was now estimated to cost $3.1 billion. "I am not aware of that," Powell said, shaking his head. Trump handed him a piece of paper, which Powell examined. "You just added in a third building," the Fed chief said, noting that the Martin Building had been completed five years ago. White House budget director Russell Vought and Trump's deputy chief of staff, James Blair, who have spearheaded criticism of the renovation as overly costly and ostentatious, later told reporters they still have questions about the project. The two men, who joined Trump during the visit, have suggested poor oversight and potential fraud in connection with it. Senate Banking Committee Chair Tim Scott, a Republican who sent Powell a letter on Wednesday demanding answers to his own questions about the renovation, also took part in the visit. Elevated by Trump to the top Fed job in 2018 and then reappointed by former President Joe Biden four years later, Powell last met with the current president in March when Trump summoned him to the White House to press him to lower rates. The visit on Thursday took place as Trump battles to deflect attention from a political crisis over his administration's refusal to release files related to convicted sex offender Jeffrey Epstein, reversing a campaign promise. Epstein died in 2019. The Fed, in letters to Vought and lawmakers backed up by documents posted on its website, said the project -- the first full rehab of the two buildings since they were built nearly a century ago -- ran into unexpected challenges, including toxic materials abatement and higher-than-estimated costs for materials and labor. Speaking outside of the construction site, Trump said there was "no tension" at his meeting with Powell and that they had a productive conversation about rates. Ahead of Trump's visit, Fed staff escorted a small group of reporters around the two construction sites. They wove around cement mixers and construction machines, and spoke over the sound of drills, banging and saws. Fed staff pointed out security features, including blast-resistant windows, that they said were a significant driver of costs in addition to tariffs and escalations in material and labor costs. The project started in mid-2022 and is on track to be completed by 2027, with the move-in planned for March 2028. A visit to the roof of the Eccles Building, a point of particular scrutiny by critics like Scott, who has complained about "rooftop garden terraces," revealed an impressive view of the Lincoln Memorial and the National Mall, according to the pool report. Staff explained that rooftop seating, although inexpensive, had been removed because of the appearance of it being an amenity and was one of only two deviations from the original plan. The other was the scrapping of a couple of planned fountains. Market reaction to Trump's visit was subdued. The yield on benchmark 10-year Treasury bonds ticked higher after data showed new jobless claims dropped in the most recent week, signaling a stable labor market not in need of support from a Fed rate cut. The S&P 500 equities index closed largely flat on the day. Trump's criticism of Powell and flirtation with firing him have previously upset financial markets and threatened a key underpinning of the global financial system -- that central banks are independent and free from political meddling. His trip contrasts with a handful of other documented presidential visits to the Fed. Then-President Franklin Delano Roosevelt visited the central bank in 1937 to dedicate the newly built headquarters, one of the two buildings now being renovated. Most recently, former President George W. Bush went there in 2006 to attend the swearing-in of Ben Bernanke as Fed chief.

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