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Asahi Shimbun
6 days ago
- Automotive
- Asahi Shimbun
Korea, U.S. prepare for summit with details of trade deal unresolved
A car carrier transporting vehicles made by Kia Motors, which is part of South Korea's biggest automaker company Hyundai Motor, travels near Pyeongtaek port in Pyeongtaek, South Korea, on July 8. (REUTERS) SEOUL--As South Korea and the United States prepare for a summit of their leaders, topics left unresolved by a recent trade deal provide scope for more disputes between the key allies and trade partners, six former negotiators and experts said. President Donald Trump may use the summit with counterpart Lee Jae Myung to seek more concessions on defense costs and corporate investments, left out of the deal, while non-tariff barriers and currency could prove thorny issues, experts said. No official summit date has been disclosed, though Trump last week gave a timeframe of two weeks. The absence of a written agreement underpinning last week's talks could open the way for disputes, with some differences already emerging in the two sides' accounts of the deal. Key among these was Sunday's denial by a South Korean presidential adviser of U.S. claims that it would take 90% of the profit from project investments of $350 billion by South Korea, which also agreed to open up its domestic rice market. 'Even a binding deal like the FTA has been efficiently scrapped,' warned Choi Seok-young, a former chief negotiator for the Korea-U.S. free trade deal, signed in 2007. 'And this is just promise.' Last week's pact was scaled down from South Korea's previous plans for a package deal on trade, security and investment envisioned in the run-up to the summit between Trump and the newly-elected Lee. But Japan struck a deal with the United States sooner than expected, spurring South Korea into a scramble for a trade-focused pact, leaving issues of security and investment for the coming summit, presidential adviser Kim Yong-beom said. Uncertainty clouds plans for $350 billion in funds Trump has said South Korea would invest in the United States in projects 'owned and controlled by the United States' and selected by him, though he gave few details of the plan's structure or timing. The allies face challenges in ironing out details of the fund at upcoming working-level talks, South Korean Finance Minister Koo Yun-cheol told reporters on Friday. 'People say the devil is in the details,' he added. In a social media post, Commerce Secretary Howard Lutnick gave an assurance of '90% of the profits going to the American people', while White House spokesperson Karoline Leavitt said part would go to the U.S. government to help repay debt. But Kim, the presidential adviser, said the two sides did not discuss profit distribution during talks, and South Korea expected the profit to be 'reinvested' in the United States. 'POLITICAL RHETORIC' The idea of the United States potentially taking most of the profit is 'hard to understand in a civilized country', he added, while dismissing as 'political rhetoric' Washington's claim that it would make all decisions about the fund. South Korea had added a safety mechanism to reduce financing risk, including U.S. commitments to buy products from the projects, under an 'offtake' clause and invest in commercially feasible projects, he said. Seoul officials have said $150 billion would go to the shipbuilding industry, with the rest earmarked for areas such as chips, batteries, critical minerals, biotechnology, nuclear power and other strategic industries. The specifics of the structure have not been determined, said Kim, adding that loans and guarantees make up a majority of the funds, with equity investments accounting for a small part. Leavitt said South Korea would provide 'historic market access to American goods like autos and rice,' echoing earlier comments by Trump. But South Korea said repeatedly there had been no agreement on the agriculture market, including beef and rice, despite strong pressure from Washington. Trump expressed keen interest in Korea's quarantine process for fruits and vegetables, Seoul said, improvements to which will figure in planned technical talks on non-tariff barriers that will also cover vehicle safety rules but gave no details. Other non-tariff barriers such as regulation of Big Tech could be hurdles. 'We cannot be relieved because we do not know when we will face pressure from tariffs or non-tariff measures again,' Trade Minister Yeo Han-koo said last week on returning from Washington. Defense costs are expected to emerge as a key issue during the upcoming summit, with Trump having long said South Korea needed to pay more for the U.S. troop presence there. In addition to the $350 billion, Trump said South Korea agreed to invest a large sum of money in the United States, to be announced during the summit, which he said on July 30 would be held within two weeks. The allies are holding working level-talks on currency policy, put on the agenda at April's opening round of trade talks.
Straits Times
04-08-2025
- Business
- Straits Times
South Korea, US prepare for summit with details of trade deal unresolved
Sign up now: Get ST's newsletters delivered to your inbox No official summit date has been disclosed, though US President Donald Trump last week gave a timeframe of two weeks. SEOUL – As South Korea and the United States prepare for a summit of their leaders, topics left unresolved by a recent trade deal provide scope for more disputes between the key allies and trade partners, six former negotiators and experts said. President Donald Trump may use the summit with counterpart Lee Jae Myung to seek more concessions on defence costs and corporate investments, left out of the deal, while non-tariff barriers and currency could prove thorny issues, experts said. No official summit date has been disclosed, though Mr Trump last week gave a timeframe of two weeks. The absence of a written agreement underpinning last week's talks could open the way for disputes, with some differences already emerging in the two sides' accounts of the deal. Key among these was Aug 3's denial by a South Korean presidential adviser of US claims that it would take 90 per cent of the profit from project investments of US$350 billion (S$450.7 billion) by South Korea, which also agreed to open up its domestic rice market. 'Even a binding deal like the FTA has been efficiently scrapped,' warned Mr Choi Seok-young, a former chief negotiator for the Korea-US free trade deal, signed in 2007. 'And this is just a promise.' Last week's pact was scaled down from South Korea's previous plans for a package deal on trade, security and investment envisioned in the run-up to the summit between Mr Trump and the newly elected Mr Lee. Top stories Swipe. Select. Stay informed. Singapore Ong Beng Seng to be sentenced on Aug 15, prosecution does not object to fine due to his poor health Singapore Recap: Ong Beng Seng pleads guilty to abetting obstruction of justice in case linked to Iswaran Singapore All recruits at BMTC will be trained to fly drones and counter them: Chan Chun Sing Singapore Pritam Singh had hoped WP would 'tip one or two more constituencies' at GE Singapore Eu Yan Sang warns of counterfeits of its health supplements being sold online Singapore Electric car-sharing firm BlueSG to wind down current operations on Aug 8 Singapore Woman, 26, hit by car after dashing across street near Orchard Road Singapore Car passenger dies after accident involving bus in Yishun But Japan struck a deal with the US sooner than expected, spurring South Korea into a scramble for a trade-focused pact, leaving issues of security and investment for the coming summit, presidential adviser Kim Yong-beom said. Uncertainty clouds plans for US$350 billion in funds Mr Trump has said South Korea would invest in the United States in projects "owned and controlled by the United States" and selected by him, though he gave few details of the plan's structure or timing. The allies face challenges in ironing out details of the fund at upcoming working-level talks, South Korean Finance Minister Koo Yun-cheol told reporters on Aug 1. "People say the devil is in the details," he added. In a social media post, Commerce Secretary Howard Lutnick gave an assurance of "90 per cent of the profits going to the American people", while White House spokeswoman Karoline Leavitt said a part would go to the US government to help repay debt. But Mr Kim, the presidential adviser, said the two sides did not discuss profit distribution during talks, and South Korea expected the profit to be "reinvested" in the United States. 'Political rhetoric' The idea of the United States potentially taking most of the profit is "hard to understand in a civilised country", he added, while dismissing as "political rhetoric" Washington's claim that it would make all decisions about the fund. South Korea had added a safety mechanism to reduce financing risk, including US commitments to buy products from the projects, under an "offtake" clause and invest in commercially feasible projects, he said. Seoul officials have said US$150 billion would go to the shipbuilding industry, with the rest earmarked for areas such as chips, batteries, critical minerals, biotechnology, nuclear power and other strategic industries. The specifics of the structure have not been determined, said Mr Kim, adding that loans and guarantees make up a majority of the funds, with equity investments accounting for a small part. Mr Leavitt said South Korea would provide "historic market access to American goods like autos and rice," echoing earlier comments by Mr Trump. But South Korea said repeatedly there had been no agreement on the agriculture market, including beef and rice, despite strong pressure from Washington. Mr Trump expressed keen interest in South Korea's quarantine process for fruits and vegetables, Seoul said, improvements to which will figure in planned technical talks on non-tariff barriers that will also cover vehicle safety rules, but gave no details. Other non-tariff barriers such as regulation of Big Tech could be hurdles. "We cannot be relieved because we do not know when we will face pressure from tariffs or non-tariff measures again," Trade Minister Yeo Han-koo said last week on returning from Washington. Defence costs are expected to emerge as a key issue during the upcoming summit, with Mr Trump having long said South Korea needed to pay more for the US troop presence there. In addition to the US$350 billion, Mr Trump said South Korea agreed to invest a large sum of money in the United States, to be announced during the summit, which he said on July 30 would be held within two weeks. The allies are holding working level-talks on currency policy, put on the agenda at April's opening round of trade talks. REUTERS
Japan Today
29-06-2025
- Business
- Japan Today
Japan hits M&A record of $232 billion, driving Asia deals rebound
By Anton Bridge, Miho Uranaka and Kane Wu Japan is driving Asia's M&A rebound in 2025 with a record $232 billion worth of deals in the first half, and bankers expect the trend to sustain fueled by multi-billion dollar take-private arrangements, outbound investments and private equity activity. Management reforms to tackle chronic low valuations among Japanese firms are spurring a flurry of foreign and activist investor interest, while Japan's low interest rates - which support deals - mean the appetite for more deals remains strong, bankers say. The deals involving Japanese companies more than tripled in value in the first half, while in the same period Asia M&A value reached $650 billion, more than double the amount year-on-year, LSEG data showed. Bankers say government calls for better corporate governance, including the privatisation of listed subsidiaries, as well as outbound acquisitions by Japanese firms seeking new growth avenues will keep igniting mega deals. Moreover, Japan has been relatively insulated from global volatility despite the broader geopolitical and macroeconomic uncertainty, helping to underpin deals momentum, they say. A cohort of Toyota Motor group companies and telecoms giant Nippon Telegraph and Telephone took private listed subsidiaries in deals worth $34.6 billion and $16.5 billion respectively, among the largest transactions globally. "There are many other deals like these on the way and their number is increasing," said Kei Nitta, global head of M&A at Nomura Securities. SoftBank Group also led a new fundraising of up to $40 billion into ChatGPT maker OpenAI in the biggest private tech funding round in history. The long-standing trend of Japanese firms looking abroad for growth opportunities in the face of a shrinking home market has continued despite heightened uncertainty in the global economy. Japanese financial institutions, such as insurer Dai-ichi Life and Nomura Holdings, announced major deals and bankers say demand remains robust across industries. "Debates over tariffs and foreign conflicts mean that some investment decisions are taking longer than usual and some customers have become more cautious, but we consider appetite for investment itself to remain very strong," Nitta said. Japanese firms themselves have also become more attractive acquisition targets as global firms have reconsidered their supply chains and distribution of resources over the past two years, Nitta added. However, there are some hurdles that could slow dealmaking in Japan. Uncertainty around the global economic outlook has made assessing companies' future prospects more difficult, leading to a disconnect in valuation expectations between buyers and sellers. This has caused an increasing number of deals to fail, said Atsushi Tatsuguchi, head of the M&A advisory group at Mitsubishi UFJ Morgan Stanley Securities. As part of the corporate reform drive, firms are under rising pressure to offload non-core business units, with private equity funds increasingly the destination for the hived off parts. Convenience store operator Seven & I Holdings – itself the target of a buyout bid from Canadian rival Alimentation Couche-Tard – sold off a bundle of its superstores and other peripheral business units to Bain Capital for some $5.5 billion in March. "Carve-outs of operating companies' non-core assets will continue to be a trend in the near term," said senior deputy head of M&A advisory at SMBC Nikko Securities, Yusuke Ishimaru. Bankers say there is a strong pipeline of potential deals involving private equity firms. Potential deals to be announced in the second half include an acquisition of Japanese cybersecurity firm Trend Micro which has a market value of 1.32 trillion yen ($8.54 billion). Bidders included Bain Capital and EQT, Reuters reported earlier this year. "Private equity funds are also seen as promising buyers for taking listed companies private," Ishimaru said. © Thomson Reuters 2025
New Straits Times
26-06-2025
- Business
- New Straits Times
Japan hits M&A record of US$232bil, driving Asia deals rebound
TOKYO/HONG KONG: Japan is driving Asia's M&A rebound in 2025 with a record US$232 billion worth of deals in the first half, and bankers expect the trend to sustain fuelled by multi-billion dollar take-private arrangements, outbound investments and private equity activity. Management reforms to tackle chronic low valuations among Japanese firms are spurring a flurry of foreign and activist investor interest, while Japan's low interest rates - which support deals - mean the appetite for more deals remains strong, bankers say. The deals involving Japanese companies more than tripled in value in the first half, while in the same period Asia M&A value reached US$650 billion, more than double the amount year-on-year, LSEG data showed. Bankers say government calls for better corporate governance, including the privatisation of listed subsidiaries, as well as outbound acquisitions by Japanese firms seeking new growth avenues will keep igniting mega deals. Moreover, Japan has been relatively insulated from global volatility despite the broader geopolitical and macroeconomic uncertainty, helping to underpin deals momentum, they say. A cohort of Toyota Motor group companies and telecoms giant Nippon Telegraph and Telephone took private listed subsidiaries in deals worth US$34.6 billion and US$16.5 billion respectively, among the largest transactions globally. "There are many other deals like these on the way and their number is increasing," said Kei Nitta, global head of M&A at Nomura Securities. SoftBank Group also led a new fundraising of up to US$40 billion into ChatGPT maker OpenAI in the biggest private tech funding round in history. The long-standing trend of Japanese firms looking abroad for growth opportunities in the face of a shrinking home market has continued despite heightened uncertainty in the global economy. Japanese financial institutions, such as insurer Dai-ichi Life and Nomura Holdings, announced major deals and bankers say demand remains robust across industries. "Debates over tariffs and foreign conflicts mean that some investment decisions are taking longer than usual and some customers have become more cautious, but we consider appetite for investment itself to remain very strong," Nitta said. Japanese firms themselves have also become more attractive acquisition targets as global firms have reconsidered their supply chains and distribution of resources over the past two years, Nitta added. However, there are some hurdles that could slow dealmaking in Japan. Uncertainty around the global economic outlook has made assessing companies' future prospects more difficult, leading to a disconnect in valuation expectations between buyers and sellers. This has caused an increasing number of deals to fail, said Atsushi Tatsuguchi, head of the M&A advisory group at Mitsubishi UFJ Morgan Stanley Securities. As part of the corporate reform drive, firms are under rising pressure to offload non-core business units, with private equity funds increasingly the destination for the hived off parts. Convenience store operator Seven & I Holdings – itself the target of a buyout bid from Canadian rival Alimentation Couche-Tard – sold off a bundle of its superstores and other peripheral business units to Bain Capital for some US$5.5 billion in March. "Carve-outs of operating companies' non-core assets will continue to be a trend in the near term," said senior deputy head of M&A advisory at SMBC Nikko Securities, Yusuke Ishimaru. Bankers say there is a strong pipeline of potential deals involving private equity firms. Potential deals to be announced in the second half include an acquisition of Japanese cybersecurity firm Trend Micro which has a market value of 1.32 trillion yen (US$8.54 billion). Bidders included Bain Capital and EQT, Reuters reported earlier this year.
Axios
04-06-2025
- Business
- Axios
Exclusive: Red-state factories most at risk in climate fight, report finds
Inflation Reduction Act tax credits for making low-carbon energy equipment are spurring over $185 billion in planned or operating factory investments, a new analysis finds. Why it matters: The Atlas Public Policy report arrives amid Capitol Hill debates that could vastly scale back the incentives. The research and advisory firm found that 77% of planned spending on credit-eligible projects it's tracked is in GOP-held House districts. You can see the top 10 above. Catch up quick: The 2022 climate law created subsidies for manufacturing a suite of products — think solar cells and wafers, wind blades and towers, EV batteries, processing critical minerals and more. Yes, but: The House-passed budget plan would restrict the timeline and access in several ways that may render it "effectively impossible to claim," Atlas notes. It ends "transferability" that makes the credit market more fluid and available to more projects. It bars credits for projects with any links to China, including materials. The bill also ends the incentive for wind in late 2027. Zoom in:"To date, a total of $48.3 billion in announced investments and 62,700 jobs are associated with operational facilities that qualify for the tax credit," the Atlas report finds. It shows another $137.2 billion and 103,100 jobs in "tracked announcements at facilities that are planned or under construction." Battery and related component manufacturing is the biggest slice, such as Toyota's planned investments in North Carolina. Atlas also says their tallies are likely undercounts of the credits' impact. State of play: Credit backers say it drives projects that will make the U.S. competitive in growing global clean tech industries and boost energy security. But GOP critics call it part of an expensive "green new scam" aimed at forcing preferred technologies onto consumers. What we're watching: Senate Republicans' ongoing work to craft their version of the House-passed "One Big Beautiful Bill." A number of GOP senators call House repeals and limits on various IRA credits too aggressive, but what that means for the manufacturing incentives is unclear. Low-carbon energy industries are lobbying aggressively for changes to the House-passed bill. The bottom line: "Elimination of the tax credit or reforms that make it inaccessible could have severe consequences for American manufacturing, weakening investor confidence, and potentially allowing China and Europe to dominate the future of clean energy production," the report argues.
