Latest news with #Trump1.0
Business Times
5 days ago
- Business
- Business Times
Asean increasingly pulled in opposite directions
ALL eyes are on US trade talks, but for the Asean countries, visibility on progress remains poor. This partly reflects the US administration's priority to strike deals with other larger economies including India, Japan, and China. For Asean, only preliminary talks have taken place and formal discussions are yet to happen. In the case of Thailand, it is yet to get a schedule for its first-round talks with high-level officials. Big ask from the US There are other fundamental factors at play. Where some preliminary talks have already occurred, it is unclear what the US wants exactly and officials have been trying to figure out the specific demands. Once they have a sense, a framework to pursue formal negotiations will be put together along with possible proposals. The US has made it unequivocally clear to its trading partners to clamp down on transshipments from China aiming to circumvent US tariffs. This demand is most relevant for Asean countries, but compliance will also likely be challenging. A few of them, especially Vietnam and Thailand, have benefited from these trade diversion effects since the first round of the US-China trade war and these will be difficult to reverse in the short run. Even in Singapore, where we did not see much re-routing in Trump 1.0, a surge in re-exports boosted its trade surplus to a record high in April. The concern is that this demand seems to be a hard constraint from the US. In Thailand's case, ahead of talks with the US, Prime Minister Paetongtarn Shinawatra reportedly ordered a tightening of the issuance of certificates of origin. But by her own admission, it will take time to resolve, likely longer than the 90-day reprieve period for tariffs which expires in early July. A NEWSLETTER FOR YOU Friday, 8.30 am Asean Business Business insights centering on South-east Asia's fast-growing economies. Sign Up Sign Up The US administration is likely bent on using negotiations with other countries to keep the pressure on China by preventing a re-routing of exports to the US via these third countries. China's calculated charm offensive At the same time, China is making its move to strengthen ties with the region, indicated by no less than President Xi Jinping's visit to Vietnam, Malaysia and Cambodia in April. Greater cooperation is the big buzzword from official statements. Key proposals from China include building an economic community and deepening supply chains with the region via the creation of industrial parks, special economic zones and technological corridors. Under China's Belt and Road Initiative, it also proposes fast-tracking the construction of infrastructure projects, particularly railways and an 'Air Silk Road' to improve regional connectivity. While the timeline for implementation of these initiatives remains unclear, the consistent theme across Asean to enhance trade and investment relations with China suggests these have likely been shaped by the desire for a common response to rising US protectionism. Follow-up action from China has also been swift, sending an even clearer signal to Asean leaders that its larger northern neighbour is serious in its intent. Before the Asean Summit in Kuala Lumpur last week, negotiations had already been completed to implement version 3.0 of the Asean-China Free Trade Area, an initiative that President Xi was encouraging as recently as his visit. This upgrade covers new sectors such as the green and digital economy and puts greater emphasis on developing regional supply chains. The inaugural Asean-China-GCC Summit also took place last week, attended by Premier Li Qiang. Malaysia can claim the unique distinction of hosting President Xi and Premier Li back-to-back within a month. In contrast, progress among Asean countries on trade talks with the US have been slow. A pivot adds to the uncertainty In addition to the complex nature of these trade negotiations with the US and the difficulties that Asean countries face in removing non-tariff barriers and reducing transshipments, being caught in the crossfire between the US and China will likely present more challenges for the region. The difficulty in coming up with a deal with the US could encourage a pivot by these countries to trade more with China and try to substitute exports to the US. China's share in Asean's total trade is already nearly twice that of the US, so this is not inconceivable, especially with China's initiatives that could bring benefits such as more investment inflows and assistance in infrastructure roll-out. On the flip side, signs of greater economic cooperation with China could prompt the Trump administration to keep US tariffs high against the Asean countries. The upshot is that uncertainty will likely remain elevated and tariffs may go back up after July, posing more downside risks for the region's growth outlook. The writer is chief Asean economist at Nomura
The Print
29-05-2025
- Business
- The Print
Musk's exit from Trump administration was inevitable. His shock-and-awe stint was unsustainable
Musk's exit from Trump administration was something everybody saw coming. His shock-and-awe stint, chain-sawing its way through bureaucracy, was unsustainable. Tesla was taking a big hit. His dislike for Trump's 'big, beautiful' spending bill was the perfect getaway. Trump 1.0 saw at least a dozen exits. It's two down already. Indian cyber scammers are targeting Japan's elderly. Act now, before it becomes a global threat After the US, Australia in 2023-24, Indian cyber scammers are targeting the elderly in Japan. ThePrint's report shows how massive amounts were stolen and converted into crypto. Stronger transnational strategy, uniform cyber laws, faster information sharing are urgently needed. Tackle the menace before Indian scam artists become a global threat.
Politico
23-05-2025
- Business
- Politico
What the ‘big, beautiful bill' means for economic growth
President Donald Trump and top Republicans have heralded the 'big, beautiful bill' as a catalyst for a massive economic expansion that will unleash corporate investment and household spending. That won't be an easy bar to clear. The economic stimulus that could come from the larger individual tax breaks and new deductions for businesses is likely to be offset by the bill's hefty cuts to the social safety net and its elimination of previous corporate incentives. While budget analysts and economists say it could moderately contribute to output, they consider the administration's sunny economic forecasts overly optimistic — particularly given the drag that higher tariffs and deficits could have on growth. 'This is definitely not a growth vehicle,' said Kent Smetters, a University of Pennsylvania business professor who serves as the faculty director of the Penn Wharton Budget Model. The main elements of Trump's 2017 tax bill, including lower corporate rates, were already permanent, Smetters said. What's more, many of the largest deductions included in the new bill are only temporary, including highly touted provisions that allow businesses to deduct capital investments and R&D expenses. That will make some of the immediate growth effects 'a bit of a mirage,' he said. The White House Council of Economic Advisers estimated that an earlier draft of the bill — specifically the tax provisions that cleared the House Ways and Means Committee last week — would add 4.2 to 5.2 percent to gross domestic product over the next four years compared to what would occur if Congress allowed existing tax cuts to expire. That report was central to the administration and House Republicans' case that the tax bill would not only preserve the status quo but unlock an economic boom. Kevin Hassett, the head of Trump's National Economic Council, told Fox Business earlier this week that he anticipates annual growth will exceed 3 percent over the coming years — a level of economic success that few modern presidents have consistently enjoyed. If that happens, the 'tax bill basically pays for itself,' Hassett said. Joe LaVorgna, the chief economist at SMBC Nikko Securities and a former Trump economic adviser, said he believes that the president's second-term economy is on a much stronger trajectory than most other economists assume and that the tax bill could push it even higher. 'The baseline I'm working off of is how we did during the first three years of Trump 1.0, when GDP was at 2.8 percent. If it was 2.8 percent [then], why can't it go to 3.0 percent?' LaVorgna said. 'If we grow at 3 percent, then the cost of this bill is going to be extremely limited compared to what everyone out there is saying.' Other estimates of how the bill's policies will impact GDP are far more muted. The nonpartisan Joint Committee on Taxation on Thursday said the measure would increase annual growth by just 0.03 percentage points — from 1.83 percent to 1.86 percent. Penn Wharton's May 19 report on the legislation's economic effects estimated that GDP would climb by 0.5 percent by 2034 — but that assumes Trump drops tariffs back to pre-April 2 levels, Smetters said. In a client note, Goldman Sachs economists said they anticipate negative growth when spending cuts, tariffs and changes to immigration were layered on top of the pro-growth policies included in the House GOP's legislation. While there are certainly components of the legislation that are stimulative — including boosts to the standard deduction, child tax credit and temporary revival of valuable corporate deductions — they're not huge. Goldman's analysis said they could positively affect year-over-year GDP by somewhere between 0.5 and 1 percentage point by mid-2026. Those effects are moderated by other provisions that could dent household finances and investment. The bill includes hefty cuts to Medicaid and the Supplemental Nutrition Assistance Program that will likely trim health care and consumer spending. Opportunities for clean energy projects that were incentivized by President Joe Biden's Inflation Reduction Act would be substantially diminished. White House spokesperson Kush Desai said Republicans had voted to 'prevent a $4 trillion tax hike, the largest in American history, on American families when they passed The One, Big, Beautiful Bill.' 'Locking in President Trump's first-term tax cuts will give American businesses and families the confidence they need to invest in the future,' he said in a statement. 'Additional relief for working-class Americans — by eliminating taxes on tips and overtime — and rewarding American manufacturing with full equipment and factory expensing will turbocharge America's economic resurgence.' Notably, Wall Street has blanched at the bill's price tag. Investor appetite for U.S. debt securities weakened over the last week amid a broader reckoning over the growing likelihood that deficits will continue to climb for the foreseeable future, putting upward pressure on long-term interest rates. That trend has likely been exacerbated by notions that protectionist trade policies may weaken the attractiveness of U.S. markets in the future, Smetters said. 'The government is going to have to try to sell these bigger deficits, this bigger amount of debt, in a world where [investors] have less global demand for that debt because of tariffs and trade,' he said.
Nikkei Asia
19-05-2025
- Business
- Nikkei Asia
The 'Trumpcession' is starting to hurt allies more than China
William Pesek is an award-winning Tokyo-based journalist and author of "Japanization: What the World Can Learn from Japan's Lost Decades." During the Trump 1.0 years from 2017 to 2021, the U.S. president's tariffs targeted Xi Jinping's China, but traditional U.S. allies such as Japan and South Korea found themselves at the center of collateral damage. Now under Trump 2.0, deja vu is striking all over again.
Politico
14-05-2025
- Business
- Politico
America tries to skirt a supercomputer gap
Presented by Amid all the hype about artificial intelligence, quantum computers and advanced chipmaking — to say nothing of the mega-billion-dollar investments— is it possible that the United States still isn't doing enough to maximize computers' potential? As Congress scrambles to put together a budget deal, some tech experts are worried about the ability of modern hardware to keep up with the demands of powerful AI tools — and arguing that government has a bigger role to play in keeping American computing globally competitive. 'Other countries are moving quickly, and without a national strategy, the U.S. risks falling behind,' wrote veteran computer scientist Jack Dongarra of the University of Tennessee in an essay published today by The Conversation. Citing the success of efforts like Europe's EuroHPC program and Japan's Fugaku supercomputer, Dongarra argues that 'a U.S. national strategy should include funding new machines and training for people to use them,' as well as 'partnerships with universities, national labs and private companies.' This might seem almost deliberately contrarian in an age of radical research cuts, but President Donald Trump's proposed budget actually maintains current spending levels for support of artificial intelligence, quantum computing and high-performance computing. Historically, at that, the U.S. has shown a willingness to make significant investments in what's broadly known as 'high-performance computing,' or supercomputers that often use millions of processors in concert to execute operations at lightning speed. The Exascale Computing Project, which spanned the Obama, Trump 1.0 and Biden eras, came to a conclusion last year with nearly $2 billion spent on a massive supercomputing effort that led to the El Capitan exascale computer at the Lawrence Livermore National Laboratory coming online in February. The supercomputer race isn't purely about technology, and America's ecosystem gives it a built-in advantage. 'China may have faster machines, but America's supercomputers have proven vastly superior,' said Stephen Ezell, vice president of global innovation policy at the Information Technology and Innovation Foundation — because they have more efficient architecture. For this, he credits the 'symbiosis' among American computing skills, hardware and software development. 'It's critical the United States both invest in skills and also in programs to help small businesses leverage these technologies,' he said. Now what? Despite the (comparative) budget support by the White House, the complex, interdependent research system that powers computer science innovations could still be threatened by the Trump administration's efforts to roll back recent policy. In his essay, Dongarra cites the National Science Foundation's Directorate of Technology, Innovation and Partnerships office as an example of pro-compute policy created by the 2022 CHIPS and Science Act, but the NSF is currently facing radical budget cuts. In his joint address to Congress this year Trump asked Speaker of the House Mike Johnson to 'get rid' of CHIPS and Science altogether. ITIF's Ezell called for the Trump administration to continue CHIPS and Science funding for high-performance computing — and called out the administration for proposed NSF budget cuts that threaten the construction of a supercomputer at the University of Texas. One major focus of White House policy under President Joe Biden was subsidizing research on and production of 'chiplets,' or small chips that can be packaged and rearranged in a modular fashion to make large-scale computing more efficient. While the European Union is investing hundreds of millions of euros in chiplet projects as part of EuroHPC, the future of similar efforts by the U.S. government remains unclear after the Trump administration brought CHIPS and Science negotiations under the auspices of the United States Investment Accelerator at the Department of Commerce in April. Quantum, another field poised to make big contributions to supercomputing, seems largely off the chopping block when it comes to government spending. Speaking at a Holland and Knight event in April, Rep. Jay Obernolte (R-Calif.) said that Congress is 'unified in our belief' that it's necessary to reauthorize the National Quantum Initiative Act, a bill signed into law during the first Trump administration that authorized more than $1 billion in spending on quantum initiatives. House Committee on Space, Science and Technology Chair Brian Babin (R-Tex.) also said he looked forward to renewing the bill. ITIF's Ezell pointed to a list of 10 policy proposals his organization made on quantum spending and support, and argued that 'America needs to graduate more computer scientists and electrical engineering students and bolster America's STEM pipeline' to support large computing projects. Given the fundamental importance of simply having the most powerful computers to fields like defense, energy, and innovation — especially amid global competition with China, one of Trump's top priorities — continuing to back high-performance computing efforts seems like a political no-brainer. But with unpredictability the only predictable thing about the second Trump administration thus far, the research and tech communities have their guard up for any threat to America's longstanding support for the sector. ai moratorium pushback An open letter from state lawmakers and AI researcher Gary Marcus argues that the proposal in the House Energy and Commerce Committee's budget reconciliation bill to block any state and local AI laws for 10 years is a 'major step backwards.' POLITICO's Alfred Ng reported for Pro subscribers on the letter, which says the moratorium would conflict with the Tenth Amendment separating powers between federal and state governments. 'The federal government should not get to control literally every aspect of how states regulate AI — particularly when they themselves have fallen down on the job — and the Constitution makes pretty clear that the bill as written is far, far too broad,' the letter said. The committee narrowly approved the moratorium this morning despite Democratic opposition. potential treasury conflicts The DOGE officials installed at the Treasury Department reported owning stock in a plethora of banks and companies doing business with the government. POLITICO's Michael Stratford reported in Morning Money today that Tom Krause, the lead official for Treasury's DOGE team, reported hundreds of thousands of dollars' worth of shares in financial companies like JPMorgan Chase, Bank of America and PNC – including some that provide services for his unit. It's not clear whether he or other DOGE members have been required to divest from financial stocks, and a Treasury spokesperson said in a statement that 'These Treasury and IRS employees are following all ethics laws and guidelines, including policies concerning recusals.' That has not convinced ethics watchdogs. Dylan Hedtler-Gaudette, the director of government at the Project on Government Oversight, called it a 'massive, glaring red flag of a conflict of interest.' He said, 'A person at this level of [the] Treasury Department should absolutely not have direct financial ties to the industries and the companies that he or she is in part responsible for overseeing.' sell, sell, sell Some of the Trump memecoin's biggest investors are already cashing out. POLITICO's Irie Sentner reported Tuesday that of the 220 top investors in the $TRUMP memecoin in line to be invited to a May 22 dinner at the president's golf club in Virginia, at least 34 sold most of their stakes just hours after the cutoff to be considered. 'There's really no reason to own it after May 12, because you're already getting the value of it if you were buying it specifically for the [dinner],' said Jeff Dorman, chief investment officer at crypto firm Arca. It's unclear who the top investors in the coin actually are, but Bloomberg reported last week that a majority of them are likely foreign, stoking concerns that the coin might open up foreign donations to Trump that would otherwise be illegal or improper. In a statement, White House press secretary Karoline Leavitt said, 'President Trump is compliant with all conflict-of-interest rules, and only acts in the best interests of the American public.' post of the day THE FUTURE IN 5 LINKS Stay in touch with the whole team: Mohar Chatterjee (mchatterjee@ Steve Heuser (sheuser@ Nate Robson (nrobson@ and Daniella Cheslow (dcheslow@
