Nvidia CEO Huang replaces Elon Musk as China's bridge to Trump
KEN MORIYASU and YIFAN YU
WASHINGTON/PALO ALTO, California -- In the summer of 2018, two red Teslas drove into Beijng's Zhongnanhai, the walled-off compound that houses the headquarters of the Chinese Communist Party and the State Council.
The Teslas parked in front of the Zi Guang Ge, or Hall of Purple Light, and CEO Elon Musk walked into the two-story pavilion to meet the powerful vice president, Wang Qishan, a close ally to President Xi Jinping.
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Japan Times
39 minutes ago
- Japan Times
Trump tariffs leave costly China supply question unanswered
U.S. President Donald Trump's recent flurry of trade deals have given Asian exporters some clarity on tariffs, but missing are key details on how to avoid punitive rates that target China's supply chains. Trump unveiled tariffs of 20% for Vietnam and 19% for Indonesia and the Philippines, signaling those are the levels the U.S. will likely settle on for most of Southeast Asia, a region that ships $352 billion worth of goods annually to the U.S. He's also threatened to rocket rates up to 40% for products deemed to be transshipped, or re-routed, through those countries — a move largely directed at curbing Chinese goods circumventing higher U.S. tariffs. But still unclear to manufacturers is how the U.S. will calculate and apply local-content requirements, key to how it will determine what constitutes transshipped goods. Southeast Asian nations are highly reliant on Chinese components and raw materials, and U.S. firms that source from the region would bear the extra tariff damage. That's left companies, investors and economists facing several unanswered questions about Trump's tariffs that appear aimed at squeezing out Chinese content, according to Deborah Elms, head of trade policy at the Hinrich Foundation in Singapore. "Is that raw materials? All raw materials? Above a certain percentage?' she said. "How about parts? What about labor or services? What about investment?' In an agreement with Indonesia last week, the White House said the two countries would negotiate "rules of origin' to ensure a third country wouldn't benefit. The deal with Vietnam earlier this month outlined a higher 40% tariff rate for transshipped goods. And Thai officials, who have yet to secure a deal, detailed that they likely need to boost local content in exports to the U.S. The Trump administration isn't providing much clarity on the matter right now. U.S. officials are still working out details with trading partners and looking at value-based local content requirements, to ensure exports are more than just assembled imported parts, according to a person familiar with the matter, who didn't want to be identified discussing private talks. A senior Trump administration official also said this week that details on the approach to transshipment are expected to be released before Aug. 1, the deadline for when higher U.S. tariffs kick in. Some factories are already adjusting their supply chains to comply with rules that will require more locally made components in production. Frank Deng, an executive at a Shanghai-based furniture exporter with operations in Vietnam — and which gets about 80% of business from the U.S. — said in an interview his firm is making adjustments as authorities appear to be more strictly enforcing country-of-origin rules. Vietnam has always had specific local content requirements for manufacturers, Deng added, including that a maximum of 30% of the volume of raw materials originates from China, and the value after production in Vietnam must be 40% higher than the imported raw materials. "We've been struggling to meet all the standards so that we can still stay in the game,' Deng said. "But I guess that's the only way to survive now.' For most of Southeast Asia, reducing the amount of Chinese-made components in manufacturing will require a complete overhaul of their supply chains. Estimates from Eurasia Group show that Chinese components make up about 60% to 70% of exports from Southeast Asia — primarily industrial inputs that go into manufacturing assembly. About 15% of the region's exports now head to the U.S., up about 4 percentage points from 2018. The U.S. has become increasingly vigilant about China's ability to bypass U.S. trade tariffs and other restrictions through third countries since Trump's first trade war in 2017. Thailand signaled its frustration over the lack of clarity for how much local content is needed in goods exported to the U.S. to avert transshipment rates, but noted it will likely be much higher than a traditional measure of 40%. "From what we've heard, the required percentage could be significantly higher, perhaps 60%, 70%, or even 80%,' Deputy Prime Minister Pichai Chunhavajira said July 14. "Emerging countries or new production bases are clearly at a disadvantage,' he said, as their manufacturing capabilities are still at an early stage and must rely on other countries for raw goods. Vietnam, Thailand and Malaysia have all taken steps this year to address Trump's concerns, increasing scrutiny of trade that passes through their ports including new rule-of-origin policies that centralize processing and imposing harsh penalties on transshippers. Developing nations may still struggle to enforce Trump's rules or comply with the rules if it means going up against China, their largest trading partner and geopolitical partner. "The reality is it's not enforceable at all,' said Dan Wang, China director at Eurasia Group. "Chinese companies have all kinds of ways to get around it and those other countries have no incentive to enforce those measures, or capacity to collect the data and determine local content.'
Nikkei Asia
2 hours ago
- Nikkei Asia
China's Premier Li proposes global AI cooperation organization
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Japan Times
2 hours ago
- Japan Times
Top U.S. Justice Department official questions Epstein accomplice for second day
The U.S. Justice Department's deputy chief conducted a second day of questioning Friday with Ghislaine Maxwell, the imprisoned accomplice of late sex offender Jeffrey Epstein, whose infamous case has created a political firestorm for President Donald Trump. Todd Blanche, who is also Trump's former personal attorney, has so far declined to say what he discussed with Maxwell in the highly unusual meetings between a convicted felon and a top DOJ official. Maxwell's lawyer, David Markus, said Friday afternoon that she was asked about "everything" and "answered every single question" during the second day of questioning at a courthouse in Tallahassee, Florida. "They asked about every single, every possible thing you could imagine," Markus told reporters outside the courtroom, without elaborating. But he did say there was "no offers" of clemency made to Maxwell, who is serving a 20-year sentence on sex trafficking charges. Trump is looking to move past the Epstein scandal, which has seen him on rare unsure footing over claims his administration mishandled a review of the notorious case. On Friday, Trump again sought to put distance between himself and Epstein, the disgraced financier who died in jail in 2019 while awaiting trial on sex trafficking charges. "I have nothing to do with the guy," Trump, whose past friendship with Epstein has received much media attention this week, told reporters ahead of a visit to Scotland. Trump urged journalists to "focus" instead on Democratic Party figures like former President Bill Clinton and his treasury secretary, former Harvard President Larry Summers, whom the Republican claimed were "really close friends" of Epstein. Asked whether he was considering a pardon or commutation of Maxwell's 20-year prison sentence for sex trafficking, Trump said it was something "I haven't thought about" — but stressed he had the power to do so. He also denied multiple U.S. media reports that he was briefed in the spring by Attorney General Pam Bondi that his name appeared multiple times in the files related to the Epstein case. "No, I was never — never briefed, no," Trump said. Multimillionaire Epstein was accused of procuring underage girls for sex with his circle of wealthy, high-profile associates when he died by suicide in a New York jail cell. His death fueled conspiracy theories that he was murdered to stop him from testifying against prominent accomplices. Trump, who had promised his supporters revelations about the case, infuriated some after his administration announced in early July that it had not discovered any new elements warranting the release of additional documents. The Department of Justice and the FBI said there was no proof that there was a "list" of Epstein's clients, while affirming he died by suicide. Ahead of the second round of questioning, Markus told reporters "Ghislaine has been treated unfairly for over five years now" and described her as a "scapegoat." "Everything she says can be corroborated and she's telling the truth. She's got no reason to lie at this point and she's going to keep telling the truth," he added. Maxwell, the only former Epstein associate who has been convicted, was jailed in 2022 for grooming underage girls between 1994 and 2004 so that Epstein could sexually exploit them. Her lawyer said she still intended to appeal her conviction in the Supreme Court. The Wall Street Journal reported Wednesday that Trump's name was among hundreds found during a DOJ review of Epstein's case files, though there has not been evidence of wrongdoing. Trump filed a $10 billion defamation suit against the Journal last week after it reported that he had penned a sexually suggestive letter to Epstein for his 50th birthday in 2003. House of Representatives Speaker Mike Johnson cut short the legislative session this week, sending lawmakers home on summer recess a day early to avoid potentially combustible debate — particularly among Trump's Republicans — on the release of files.
