Nippon Steel to fall in red due to special loss over US Steel deal
The company's latest outlook, a sharp reversal from its earlier forecast of a 200 billion yen net profit, includes a special loss of 240 billion yen from the sale of all its shares in an Alabama-based joint venture with global steel supplier ArcelorMittal SA. The earlier planned transaction was executed after the U.S. Steel purchase was finalized to address antitrust concerns.
For the April-June quarter, it said revenues fell by 8.3 percent to 2.01 trillion yen, while it booked an operating loss of 139.56 billion yen and a net loss of 195.83 billion yen.
Nippon Steel said in June it completed the $14.1 billion buyout of U.S. Steel after securing a national-security agreement with the administration of U.S. President Donald Trump, putting an end to a year-and-a half struggle to advance the deal with the iconic American company.
The Japanese producer expects a full-year loss despite incorporating earnings of U.S. Steel for the nine months from July, expecting a lift by 80 billion yen.
But "uncertainties persist" regarding the impact of Trump's higher tariffs on steel, auto and other products, Nippon Steel Executive Vice President Takahiro Mori said at a press conference.
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The Diplomat
11 minutes ago
- The Diplomat
As the US Rethinks AUKUS, Australia and the UK Forge Ahead
While the U.S. reviews AUKUS, amid pessimism about its feasibility, Canberra and London are tightening their strategic partnership. Amid the Trump administration's ongoing review of the AUKUS trilateral security pact, Canberra paid Washington $800 million as the second 2025 installment for submarine capability and capacity development. Australian and British regulators also met in England to update their Memorandum of Cooperation for enhanced information sharing on the nuclear submarine sector. A 50-year bilateral Nuclear-Powered Submarine Partnership and Collaboration Agreement was signed in the same week during the 15th AUKMIN held in Geelong, Australia. Australian Trade Minister Don Farrell brushed off the idea that the bilateral treaty would cause annoyance in Washington. 'The message that the Americans will get out of this is that the other two parties to AUKUS are very, very supportive of the continuation of the project,' he argued. Commencement of the Geelong Treaty negotiations was announced at the trilateral AUKUS defense ministerial meeting in September 2024. While focusing on the establishment of strategic and operational frameworks for the delivery of AUKUS' nuclear-powered submarines (SSNs), the treaty signifies London and Canberra's extended commitment to strengthening the resilience of submarine industrial bases across the two nations well beyond the AUKUS timeline, which looks to have eight SSN submarines built in Australia by the 2060s. The treaty also strikes a chord with the U.K.'s Strategic Defense Review published in June, announcing the enhancement of British submarine production with up to 12 SSNs by producing a submarine every 18 months. The renewed defense vision by the British government pays particular attention to Pillar 2 of AUKUS against the backdrop of 'a new era of threat,' underscoring the need to forge closer industrial and technological partnerships with the US for defense capability upgrades. Pillar 1 of AUKUS focuses on developing shipbuilding capacities of the three nations, which includes Australia's acquisition of its first SSNs. Pillar 2 focuses on joint development of eight advanced military capability areas such as autonomy, artificial intelligence (AI), electromagnetic warfare, modelling, and simulation. The United States' Reassessment While Australia and the U.K. push forward, the Pentagon is undertaking a review of the deal. One of the questions under scrutiny is whether the U.S. industrial base can support U.S. naval strategy in today's complex security environment. The current production rate of Virginia-class submarines stands at 1.13 per year – far from the rate of two per year necessary for fulfilling its own defense priorities and the 2.33/year rate necessary to deliver on its AUKUS promises. Under those circumstances, the U.S. commander-in-chief would not be able to sign off on relinquishing SSNs to Australia as scheduled per the AUKUS mandate. To make good on its AUKUS obligations, the U.S. shipbuilding industry is 'going to require a transformational improvement' with a '100 percent' boost in delivery pace, Adm. Daryl Caudle said on July 24, in a Senate hearing to consider his nomination as the next chief of naval operations. He particularly pointed out existing deficiencies of the U.S. Navy's undersea capability. Caudle told the U.S. Senate that 'the delivery pace is not where it needs to be to make good on the Pillar 1 of the AUKUS agreement, which is currently under review by our Defense Department.' Another sticking point for Washington is the commitment to collective defense among U.S. allies in light of the growing flashpoints across the Indo-Pacific. The Pentagon review is being led by U.S. Under Secretary of Defense for Policy Elbridge Colby, an AUKUS skeptic who has pressed Australia on how it would act in a hypothetical China-U.S. conflict over Taiwan. Using his account on X, Colby also urged allies to step up defense spending, doubling down on the Trump administration's earlier call for Australia to raise defense spending to 3.5 percent of its GDP from 2.33 percent by 2033. However, Australian Prime Minister Anthony Albanese and his Cabinet continue to refrain from making further military and financial commitments. Prior to joining the Trump administration, Colby cast doubts over the United States' AUKUS deliverables during a January 2024 interview with the Australian Broadcasting Corporation. 'It would be crazy for the United States to give away its single most important asset for a conflict with China over Taiwan when it doesn't have enough already,' he said at the time. 'Money is not the only issue – it's also time, limits on our workforce, etc., so both sides of this vitally important alliance need to look reality in the face.' Despite the new Australia-U.K. treaty and memorandum, Australia's timely down payment, and Pillar 2 partnership envisagement, these reassuring moves did not allay the concerns that have Colby and the Pentagon rethinking AUKUS. China's Reactions Although there was no public mention of AUKUS being on the agenda in the meeting between Australian Prime Minister Anthony Albanese and China's President Xi Jinping in July, China is seen making more subtle moves to counter the trilateral defense partnership in the region. While Albanese was in Chengdu as part of his second official visit to China as prime minister, China's Consul General in Sydney Wang Yu caught Newcastle Mayor Ross Kerridge by surprise on July 17, with a question on potential docking locations for AUKUS submarines. Australian federal government officials and senators have voiced concerns regarding national security being brought to city-level closed-door meet-and-greets. On the sidelines of the 58th Association of Southeast Asian Nations (ASEAN) Foreign Ministers' Meeting in July, China shared its intention to accede to ASEAN's Protocol to the Southeast Asian Nuclear Weapon-Free Zone Treaty. The treaty commits state parties not to develop, acquire, and station nuclear weapons. China emphasized in its announcement that the region is 'not an arena for major power rivalry.' The 10 ASEAN nations have been calling on the five nuclear weapon states – including both the U.S. and the U.K. – to ratify the treaty since 1997, and China expressed support as early as 1999. However, Beijing's latest confirmation that it will sign the treaty, after more than two decades of intent, could not only reinforce China's good neighborhood image without additional tangible commitments but also add to its toolbelt for discrediting nuclear-powered military partnerships in the region. A French (Re)involvement? As the Pentagon's AUKUS review prolongs, recent activities suggest France might be a keen onlooker of the development. Under the Lancaster House 2.0 and Northwood Declaration unveiled during French President Emmanuel Macron's recent state visit to the United Kingdom in July, nuclear coordination and cooperation were deepened between the two European nuclear powers. Their enhanced nuclear research, intelligence exchange, and overall defense capability could indirectly complement Pillar 2 of AUKUS – even without France joining. Additionally, France and the U.K. also agreed to strengthen maritime coordination in the Indo-Pacific through joint security training, reciprocal base access, and the launch of a new Global Maritime Security Dialogue. The renewed interest by the French government recognizes its shared responsibility in the region, given that more than 90 percent of France's Exclusive Economic Zone is in the Indo-Pacific. Subsequently, the French government revamped its Indo-Pacific strategy as a priority in July with an emphasis on strategic autonomy and sovereignty partnerships. Most prominently, Australia is now back on the list of 'priority strategic partners' after being taken out from France's 2022 strategy after AUKUS was formed. The new SSN partnership left France blindsided, as it also brought the cancellation of an Australia-France contract for diesel-electric submarines. Rebuilding Australia-France ties from that 'unprecedented new low' has been prioritized by the Albanese administration from the beginning. A $585 million settlement to the French Naval Group was agreed to less than a month after Albanese took office in July 2022, and a three-pillar roadmap was laid out soon after for their New Agenda for Bilateral Cooperation. French Ambassador Pierre-André Imbert did not rule out a future submarine deal with Australia as the French armed Forces joined the 19-nation military drill in Australian waters and Papua New Guinea in July. Australia has 'chosen AUKUS… If that changes – if they ask, we will see,' he said. 'The first pillar of our Cooperation is Defense and Security, so we have a very good level of cooperation.' Speculation and public anxiety continue to sprout with the Pentagon review expected to be concluded in the fall. In the meantime, calls for an Australian inquiry into the nation's largest-ever defense project are simmering. With high-profile figures like former Prime Minister Malcolm Turnbull expressing opposition to the deal. The path for Australia to acquire nuclear-powered submarines is likely to remain rocky, with the question at hand not being whether AUKUS should continue, but how. Calls for contingencies and deliverable assurances are rising as the pact comes under scrutiny.
Japan Times
an hour ago
- Japan Times
U.N. lays out survival plan as Trump threatens to slash funding
U.N. Secretary-General Antonio Guterres is slashing more than $700 million in spending and laying plans to overhaul the United Nations as its largest sponsor, the U.S., pulls back support. Guterres' plan calls for 20% cuts in expenditures and employment, which would bring its budget, now $3.7 billion, to the lowest since 2018. About 3,000 jobs would be cut. Officially, the reform program is pegged to the U.N.'s 80th anniversary, not the new U.S. administration. But the scale of the reductions reflects the threat to U.S. support, which traditionally accounts for 22% of the organization's budget. U.S. President Donald Trump has suspended that funding and pulled out of several U.N. bodies already, with a broader review expected to lead to further cuts. "We're not going to be part of organizations that pursue policies that hamper the United States,' Deputy State Department spokesman Tommy Pigott told reporters Thursday. The planned cuts at the U.N. come as the Trump administration has eliminated tens of billions of dollars in foreign aid as part of its drive to focus on what it sees as U.S. interests. Conflicts from the Mideast to Ukraine and Africa have added to the need for global assistance. After years of financial struggles, the U.N. under Guterres already was planning to make sweeping structural changes. He warned in January it was facing "a full-blown liquidity crisis.' Overall, spending across the U.N. system is expected to fall to the lowest level in about a decade — down as much as $20 billion from its high in 2023. "U.N. 80 is in large part a reaction from the secretary-general to the kind of challenges posed by the second Trump administration,' said Eugene Chen, senior fellow at New York University's Center on International Cooperation. Guterres is expected to release details of his overhaul plans in a budget in September. The plan calls for restructuring many of its programs. Guterres controls the U.N.'s regular budget, which is only a fraction of the total expenditures of its affiliates. Facing funding shortages of their own, agencies like UNICEF and UNESCO are also planning major cutbacks. The Trump administration already has stopped funds from going into the U.N. Relief and Works Agency for Palestine Refugees in the Near East, withdrawn from the U.N. Human Rights Council and left UNESCO. Guterres' plan has also drawn criticism, both from Trump allies and inside the U.N. "There are some things that the U.N. does that arguably should be increased in terms of resources,' said Brett Schaefer, a senior fellow at the conservative American Enterprise Institute. "And then there are some things that the U.N. shouldn't be decreasing but eliminating altogether.' He cited the U.N.'s nuclear watchdog and the World Food Program as contributing significantly to U.S. interests and singled out the Food and Agriculture Organization and Human Rights Council as having mandates at odds with American policy. Meanwhile, U.N. staff in Geneva announced last week they passed a motion of no confidence in Guterres and the plan. "Staff felt its slash and burn approach lacked focus, had no strategic purpose, and was making the U.N. more top-heavy and bloated,' Ian Richards, president of the U.N. Staff Union in Geneva, posted on LinkedIn about the U.N. 80 report. That vote has largely symbolic importance, according to NYU's Chen. Still, Guterres' efforts to get ahead of the inevitable cuts that reductions in U.S. support will bring could help the U.N. adapt, he added. "Maybe that's a silver lining,' Chen said. "We'll all be primed for reform.'
Japan Today
an hour ago
- Japan Today
White House defends firing of Bureau of Labor Statistics head as critics warn of trust erosion
U.S. President Donald Trump walks with Col. Christopher Robinson 89th Airlift Commander after stepping off Marine One at Joint Base Andrews, Maryland, U.S., August 1, 2025. REUTERS/Ken Cedeno By Doina Chiacu and Jasper Ward White House economic advisers on Sunday defended President Donald Trump's firing of the head of the Bureau of Labor Statistics, pushing back against criticism that Trump's action could undermine confidence in official U.S. economic data. Later on Sunday, Trump again criticized BLS Commissioner Erika McEntarfer, without providing evidence of wrongdoing, and said he would name a new BLS commissioner in the next three or four days. U.S. Trade Representative Jamieson Greer told CBS that Trump had "real concerns" about the BLS data, while Kevin Hassett, director of the National Economic Council, said the president "is right to call for new leadership." Hassett said on Fox News Sunday the main concern was Friday's BLS report of net downward revisions showing 258,000 fewer jobs had been created in May and June than previously reported. Trump accused McEntarfer of faking the jobs numbers, without providing any evidence of data manipulation. The BLS compiles the closely watched employment report as well as consumer and producer price data. The BLS gave no reason for the revised data but noted "monthly revisions result from additional reports received from businesses and government agencies since the last published estimates and from the recalculation of seasonal factors." McEntarfer responded to her abrupt dismissal on Friday in a post on the Bluesky social media platform, saying it was "the honor of her life" to serve as BLS commissioner and praising the civil servants who work there. McEntarfer's firing added to growing concerns about the quality of U.S. economic data and came on the heels of a raft of new tariffs on dozens of trading partners, sending global stock markets tumbling as Trump presses ahead with plans to reorder the global economy. Investors also are watching the impact of the surprise resignation of Federal Reserve governor Adriana Kugler, which opened a spot on the central bank's powerful board and could shake up what was already a fractious succession process for Fed leadership amid difficult relations with Trump. Trump said on Sunday he would announce a candidate to fill the open Fed position within the next couple days. REVISIONS ARE COMMON In an interview with CBS' "Face the Nation," Greer acknowledged there were always revisions of job numbers, "but sometimes you see these revisions go in really extreme ways." Brian Moynihan, CEO of Bank of America, said large revisions of economic data could undermine public confidence and that government officials should develop ways of improving data quality. "They can get this data, I think, other ways and I think that's where the focus ought to be: how do we get the data to be more resilient and more predictable and more understandable?" he said on CBS. "Because what bounces around is restatements ... that creates doubt about it." Critics, including former leaders of the BLS, slammed Trump's move and called on Congress to investigate McEntarfer's removal, saying it would shake trust in a respected agency. "It undermines credibility," said William Beach, a former BLS commissioner and co-chair of the group Friends of the BLS. "There is no way for a commissioner to rig the jobs numbers," he said. "Every year we've revised the numbers. When I was commissioner, we had a 500,000 job revision during President Trump's first term," he said on CNN's "State of the Union." Former Treasury Secretary Larry Summers, who worked in both the Clinton and Obama administrations, also criticized McEntarfer's firing. "This is a preposterous charge. These numbers are put together by teams of literally hundreds of people following detailed procedures that are in manuals," Summers said on ABC's "This Week." LARGE REVISION The BLS surveys 121,000 employers - businesses and government agencies - each month, seeking their total payroll employment during the week in which the 12th day of the month falls. The response rate has fallen sharply since the COVID pandemic, from 80.3% in October 2020 to about 67.1% in July. Knowing that, BLS allows late-arriving employer submissions, and revisions to earlier submissions, to be taken into account over the next two months. That means each month's initial estimate of employment for the immediately preceding month also contains revisions to the two months before that. The revisions in Friday's report were large by historic standards. The downward revision of 125,000 jobs for May was the largest between a second estimate and third estimate since a 492,000 reduction for March 2020. That was the largest ever and was reported in June 2020 for the payrolls report for May 2020. © Thomson Reuters 2025.
