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January
Most big Japanese firms heed prime minister's call to raise wages this year - Reuters poll
Written by Nur Yasmin
More than half of big Japanese companies are planning to raise wages this year, according to a Reuters monthly poll, meeting a key request from Prime Minister Fumio Kishida to help workers cope with surging consumer prices.
Kishida's administration has repeatedly urged companies to make maximum efforts to lift employee pay, which has failed to keep up with the fastest inflation in 40 years. That push was boosted last week when Uniqlo operator Fast Retailing Co (9983.T) said it would raise wages by as much as 40%.
Ahead of spring "shunto" labour negotiations, managers at 24% of the companies polled said they planned on across-the-board bumps in base salary along with regularly scheduled wage increases. Another 29% said they would carry out regular pay increases only, while 38% were undecided.
"Prime Minister Kishida has been saying raise wages, raise wages, but the decision to hike pay isn't done on the words of a prime minister or president," said Masayuki Kubota, chief strategist at Rakuten Securities. "Rather it's because a company needs better human resources to achieve its growth potential."
"If the company isn't competitive, raising wages translates just to higher costs that will only worsen its situation," he added.
A total of 34% of firms said they planned wage increases of at least 3%, a jump from 10% in a Reuters survey in October.
While the survey focused on large corporations, the outlook remains less rosy for small and medium-sized firms that provide most jobs in the world's third-largest economy.
Smaller firms generally cannot increase pay, business owners, economists and officials say, because they often struggle to pass on higher costs out of fear of losing customers.
TAX INCREASES OPPOSED
The survey also showed that big companies are less eager to bear the brunt of another Kishida plan: unprecedented military spending to counter growing threats from China and North Korea. To help pay for it, the plan calls for corporate tax surcharges of 4% to 4.5% that would take effect from fiscal 2024 or later.
Among 495 firms polled, 54% supported the defence spending plan, but just 29% backed the increase in corporate tax rates.
"Without any explanation of how the increase in defence spending will be used, the policy to assign most of the burden on corporate taxes is totally unacceptable," said a manager at an industrial ceramics company, speaking on condition of anonymity. "This could put a damper on wage increases and capital investment."
Asked what expenses would be curtailed if corporate levies go up, the top answer was capital spending, at 42%, followed by dividends and wages.
In the Reuters October survey, 81% of companies said they approved of a substantial increase in defence spending, but just 20% said corporate taxes should be lifted to pay for it.
On the overall business environment, corporate managers turned slightly more pessimistic, with 81% saying conditions would be "not so good" to "bad" in the next three months, compared with 77% in the December survey.
"The weak yen along with higher raw material prices continue to squeeze profit margins," said a manager at a manufacturing company. "Although our company raised prices last spring and autumn, it wasn't enough to absorb the materials costs, so we plan to raise prices again this spring."
The Reuters Corporate Survey, conducted for Reuters by Nikkei Research between Dec. 23 and Jan. 13, canvassed 495 big non-financial Japanese firms on condition of anonymity, allowing them to speak more freely. (Reuters)
January
Kazakh president calls early parliamentary election for March
Written by Nur Yasmin
Kazakh President Kassym-Jomart Tokayev dissolved the lower house of parliament on Thursday and called a snap election for March 19, his office said.
Tokayev had previously said he would dissolve the chamber, elected in 2021, after wresting power away from long-time leader Nursultan Nazarbayev last year and overseeing constitutional reforms.
Kazakhstan has had no genuine opposition parties in parliament for decades and, although party registration requirements have been relaxed under Tokayev, the legislature is likely to remain strongly pro-government.
In the election, 30% of deputies will be elected in single-mandate constituencies while the other 70% will be nominated by parties.
Tokayev last year resigned from the Amanat party, which dominates parliament, and said he would stay out of party politics. (Reuters)
January
North Korea calls for normalising factories, economy after COVID 'upheaval'
Written by Nur Yasmin
North Korea's parliament has outlined plans to normalise industrial production and meet its economic goals this year, despite the "worst-ever upheaval" amid the coronavirus pandemic in 2022, state media said on Thursday.
The reclusive country's rubber-stamp parliament, the Supreme People's Assembly, held a two-day meeting from Tuesday to discuss government budget, economic policy and personnel changes, the official KCNA news agency said.
South Korea's central bank has said the North's economy shrank in 2021 for a second straight year after suffering its biggest contraction in more than two decades the year before, hit by COVID-19 lockdowns and international sanctions over its weapons programmes.
Leader Kim Jong Un did not join the meeting, but Kim Tok Hun, premier of the cabinet, reviewed last year's work and laid out tasks this year for key industries.
The premier lauded the country for "successfully tackling the worst-ever upheaval since the founding of the country" amid the COVID-19 outbreak, despite "shortcomings" in implementing last year's plans.
The cabinet aims to expedite the production of overall sectors and make 2023 "a year of great turn and change in the course of development" marking the 75th anniversary of the country's foundation, Kim said.
"It will make sure that the economic indices and 12 major goals to be attained by all the sectors of the national economy are carried out without fail," Kim said, according to KCNA.
He called for normalising the production of metal factories and reinforcing iron mines and steel plants, and for operating chemical plants "at full capacity" to accelerate construction projects.
The country will also take "strong measures" to supply equipment, materials and funds to boost coal production, Kim said.
In another KCNA dispatch on budget deliberations, Finance Minister Ko Jong Bom said this year's overall spending is expected to rise by 101.7% from last year, without specifying numbers.
Some 45% of the total expenditure will be allotted to promote the economy and the people's livelihoods, while defence spending would take up 15.9%, about the same as last year, Ko said.
"The state budget for this year should be implemented without fail to financially support the work for bolstering up the country's defence capability, developing the economy and improving the people's standard of living," Ko told the parliament. (Reuters)
January
Jacinda Ardern leaves mixed legacy as she resigns as New Zealand prime minister
Written by Nur Yasmin
Jacinda Ardern has put tiny New Zealand on the map in her five years as prime minister, becoming a global icon for left-leaning politics and women in leadership, even as she struggled at home with the economy and COVID-19 restrictions.
The 42-year-old - who gained attention for bringing her baby to a United Nations meeting and wearing a hijab after a massacre targeting Muslims - announced in similarly dramatic fashion on Thursday that she will step down in less than three weeks, saying she had "no more in the tank".
"Be strong, be kind," New Zealand's youngest prime minister in more than a century repeated through her eventful tenure, but her empathetic leadership and crisis management skills often masked her government's shortcomings.
Considered personable and engaging, Ardern turned speaking from the heart and smiling through adversity into a winning formula for surging to power in 2017 and returning with a blowout win in 2020 that ushered in New Zealand's first purely left-leaning government in decades.
Her leadership was marked by unprecedented events for the island nation of 5 million: the 2019 massacre of 51 Muslim worshippers in Christchurch by a white supremacist and the eruption of the White Island volcano, and, the next year, the pandemic.
"I hope I leave New Zealanders with a belief that you can be kind but strong, empathetic but decisive, optimistic but focussed," Ardern said in an emotional resignation announcement. "And that you can be your own kind of leader - one who knows when it’s time to go."
PROBLEMS MOUNT, RATINGS FALL
Ardern received worldwide praise for her response to the Christchurch attacks, which she labelled terrorism. Wearing a headscarf, she met the Muslim community, telling them New Zealand was "united in grief".
She delivered a ban on semiautomatic firearms and other gun curbs within weeks of the massacre, a stark contrast to the United States, where lawmakers and activists have struggled to address gun violence despite regular mass shootings.
Launching a global campaign to end online hate, she has often herself been a target of right-wing extremists online.
Ardern made global headlines in 2020, presiding over New Zealand's most diverse parliament, with more than half the members women and the highest number of indigenous Maori lawmakers.
When COVID arrived, she was among the first leaders to close borders and pursue a zero-tolerance strategy that kept New Zealanders safe from the virus, holding death rates far below those of other advanced nations.
But not everyone was happy with her "go hard, go early" approach, which included a nationwide lockdown over a single infection.
While Ardern's popularity rose internationally, at home she has faced growing political headwinds, struggling to prove that her leadership extended beyond crisis management and kindness.
Her ratings have dropped in recent months on a worsening housing crisis, rising living costs and mortgage rates, and growing concerns about crime. She remains, however, more popular that her rivals.
Despite her promises of transformational leadership, Ardern's affordable housing programmes have been set back by blunders. Even on climate change, which Ardern called "my generation's nuclear-free moment", progress has been incremental.
REFRESHING
Ardern burst onto the global scene in 2017 when she became the world's youngest female head of government at the age of 37.
Riding a wave of "Jacinda-mania," she campaigned passionately for women's rights and an end to child poverty and economic inequality in the country.
Raised a Mormon by her mother and police officer father, Ardern left the church over its stance on LGBTQ people in the early 2000s and has since described herself as agnostic.
Hours after being appointed Labour Party leader, she was asked whether she planned to have children. Ardern said it was "totally unacceptable in 2017 to say that women should have to answer that question in the workplace".
Eight months after becoming premier, she had a baby daughter, becoming only the second elected leader to give birth while in office, after Pakistan's Benazir Bhutto. Less than three months later, Ardern brought the baby, Neve Te Aroha, to the U.N. General Assembly in New York.
Many took her pregnancy and prime minister's maternity leave as symbolising progress for women leaders, part of a wave of progressive female leaders including Finnish Prime Minister Sanna Marin.
Meeting with Marin in Wellington in November, Ardern shot back at a question whether the two were meeting only because of they were young and female.
“I wonder whether or not anyone ever asked Barack Obama and John Key if they met because they were of similar age,” Ardern said, in reference to the former U.S. president and New Zealand prime minister. "Because two women meet, it’s not simply because of their gender." (Reuters)
January
Russia: Zelenskiy peace plan absurd, no serious proposal on table
Written by Nur Yasmin
Russian Foreign Minister Sergei Lavrov said on Wednesday that Moscow had yet to see any serious proposals for peace in Ukraine and that Ukrainian President Volodymyr Zelenskiy's suggestions were absurd.
Lavrov said Moscow stood ready to discuss the conflict with Western countries and to respond to any serious proposals, but that any talks needed to address Russia's wider security concerns.
Speaking at a news conference in Moscow, Lavrov called again for NATO to remove its "military infrastructure" from Ukraine and other countries close to Russia's borders.
"There can be no talk of negotiations with Zelenskiy," Lavrov said, describing the Ukrainian leader's 10-point plan unveiled last November as consisting of "completely absurd initiatives".
"As for the prospects for negotiations between Russia and the West on the Ukrainian issue, we will be ready to respond to any serious proposals. (But) we don't see any serious proposals yet. We will be ready to consider them and decide," Lavrov said.
Lavrov said statements by Western governments that they would not discuss anything about Ukraine without Kyiv's involvement were "all nonsense", because the West was actually taking the decisions. (Reuters)
January
Davos 2023: Saudi Arabia changing no-strings aid, finance minister says
Written by Nur Yasmin
Saudi Arabia's finance minister said on Wednesday the kingdom is changing the way it provides assistance to allies, shifting from previously giving direct grants and deposits unconditionally.
"We used to give direct grants and deposits without strings attached and we are changing that," Mohammed al-Jadaan said at the World Economic Forum in Davos, adding Saudi Arabia was encouraging countries in the region to make reforms.
"We need to see reforms. We are taxing our people, we are expecting also others to do the same, to do their efforts. We want to help but we want you also to do your part." (Reuters)
January
Lavrov compares West's approach to Russia with Hitler's 'Final Solution'
Written by Nur Yasmin
Russian Foreign Minister Sergei Lavrov said on Wednesday that the United States had assembled a coalition of European countries to solve "the Russian question" in the same way that Adolf Hitler had sought a "final solution" to eradicate Europe's Jews.
Lavrov, who caused an international furore last year with remarks about Hitler, said Washington was using the same tactic as Napoleon and the Nazis in trying to subjugate Europe in order to destroy Russia.
Using Ukraine as a proxy, he said, "they are waging war against our country with the same task: the 'final solution' of the Russian question".
"Just as Hitler wanted a 'final solution' to the Jewish question, now, if you read Western politicians ... they clearly say Russia must suffer a strategic defeat."
The 'Final Solution' was Hitler's Holocaust blueprint, which led to the systematic murder of 6 million Jews, as well as members of other minorities.
Lavrov has caused outrage before with remarks about Hitler. Last May he said the Nazi leader had had "Jewish blood", drawing angry protests from Israel. (Reuters)
January
Iron ore futures rebound as bargain hunting supports
Written by Nur Yasmin
Iron ore futures rose on Wednesday in a bargain-buying bounce from a slump in previous sessions after investors stayed on the sidelines following China's state planner's decision to clamp down on excessive market speculation.
The most-traded May iron ore on China's Dalian Commodity Exchange ended day-time trade 0.9% higher at 841.5 yuan ($124.27) a tonne.
On the Singapore Exchange, the benchmark February iron ore was up 0.7% at $121.40 a tonne, as of 0703 GMT.
China's state planner issued on Wednesday its third warning this month against excessive speculation in iron ore, adding that it will increase supervision of the country's spot and futures markets.
The outcome of Tuesday's meeting lacked any real teeth, so markets have assimilated it and moved on. In fact, some traders are using these events as a "buy the dip" opportunity, said Atilla Widnell, managing director of Navigate Commodities.
China's property sector fell 5.1% in 2022 from a year earlier, value-added data from the National Bureau of Statistics (NBS) showed on Wednesday, heaping more pressure on policymakers to revive the sluggish sector in 2023.
Brazil's CSN Mineracao SA (CMIN3.SA) said on Tuesday it has reached a deal for a long-term supply of iron ore to Swiss trader Glencore.
The most-active rebar contract on the Shanghai Futures Exchange climbed 1.5%, hot-rolled coil rose 1.5%, wire rod edged 0.9% higher, and stainless steel gained 0.4%.
During 2023, crude steel production will continue to be affected by the Chinese central government's determination to ensure that steel output remains flat or below the previous year's total, according to Mysteel consultancy.
Dalian coking coal and coke rose 2% and 1.4%, respectively.
Coronado Global Resources (CRN.AX), which has not typically sold Australian coking coal to China, has received enquiries for long-term supply as Beijing lifts its unofficial ban on coal imports from Australia, its chief executive said on Wednesday. (Reuters)
January
U.S., Taiwan officials pledge ambitious trade negotiating schedule
Written by Nur Yasmin
The United States and Taiwan concluded four days of trade negotiations on Monday and reached consensus on several areas related to trade facilitation, anti-corruption, small and medium-sized enterprises and regulatory practices, the U.S. Trade Representative's office said.
The first major negotiating round of the U.S.-Taiwan Initiative on 21st Century Trade saw the two sides exchange texts on those areas in Taipei, the office said in a statement.
"Officials also reached consensus in a number of areas and pledged to maintain an ambitious negotiating schedule in the months ahead to continue this momentum," the statement said.
Taiwan's top trade negotiator, John Deng, told reporters in Taipei he was "quite satisfied" with the outcome of the meetings.
"Both parties are willing to speed up the process," he said. "There is a high degree of ambition and I hope there will be considerable results this year."
The talks, which do not include tariff reductions or traditional market access enhancements, aim to reach agreements with "economically meaningful" outcomes and will include discussions on China's "economic coercion," Deng said last year.
Taiwan has also applied to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, or CPTPP, and Deng said an agreement with the United States could help with that bid.
"If an agreement can be successfully signed with the United States, it will also be proof that Taiwan is capable and willing to accept high standards, which will be of considerable help to Taiwan's membership in the CPTPP," Deng said.
Taiwan last year was excluded from a broader U.S. trade initiative covering Indo-Pacific countries, the Indo Pacific Economic Framework, that also focuses on non-tariff issues.
The U.S. Trade Representative's office (USTR) said the trade texts exchanged during the Taipei negotiating round "follow through on the two sides' shared commitment to pursue a high-ambition trade initiative" that would "strengthen and deepen economic and trade ties."
The USTR statement did not include a date for the next round of negotiations, saying that this would be revealed.
Any agreements reached between the United States and Taiwan would not need approval from the U.S. Congress, but USTR said congressional staff attended the meetings and were briefed throughout the talks.
Despite the lack of formal diplomatic ties, the United States has been eager to bolster support for Taiwan, especially as it faces stepped-up political pressure from China to accept its sovereignty claims.
China has expressed strong opposition to the new Taiwan-U.S. trade initiative. (Reuters)
January
Pacific islands urge Japan to delay release of Fukushima waste over contamination fears
Written by Nur Yasmin
Pacific island nations are urging Japan to delay the release of water from the destroyed Fukushima nuclear power plant over fears fisheries will be contaminated, the Pacific Island Forum (PIF) said on Wednesday.
The Japanese government said last week that water from the destroyed Fukushima nuclear power plant could be released into the sea "around this spring or summer," raising concerns from island nations still grappling with the legacy of nuclear testing decades ago.
Japan had approved the future release of more than 1 million tonnes of water from the site into the ocean after treatment in April 2021.
The PIF, a regional bloc of 17 island nations, argues the release of the water could have a major impact on fishing grounds that island economies rely on, and where up to half of the world's tuna is sourced.
"Our region is steadfast that there be no discharge until all parties verify it is safe," PIF Secretary General Henry Puna said on Wednesday at a livestreamed public meeting in Suva, Fiji.
"We must prevent action that will lead or mislead us towards another major nuclear contamination disaster at the hands of others," he added, saying Pacific islanders continued to endure the long-term impacts of the nuclear testing legacy on a daily basis.
The United States conducted nuclear testing in the Pacific islands in the 1940s and 1950s and the Marshall Islands continues to campaign for more compensation from Washington over lasting health and environmental effects.
France conducted atomic testing between 1966 and 1996 at Mururoa Atoll in French Pacific territories.
Ken Buesseler, a scientist with the Woods Hole Oceanographic Institute, told the forum on Wednesday that a PIF scientific expert panel was urging Japan to reconsider the waste release because it was not supported by data and more information was needed.
Radioctivity moves across the ocean with currents and tides and risks contaminating fish, he said.
Japan's foreign ministry has previously said that regulators deemed it safe to release the water, which would be filtered to remove most isotopes but would still contain traces of tritium, an isotope of hydrogen hard to separate from water. (Reuters)