Afp Business Asia

As Japan’s biggest defence exhibition kicked off this week, visitors got a close-up look at a model of its futuristic “railgun” that its makers hope will be able to shoot down hypersonic missiles.Instead of gunpowder, railgun technology uses electromagnetic energy to fire a projectile along a set of rails at ultra-high velocity.The round will then in theory destroy the target, which could be an enemy ship, drone or incoming ballistic missile, solely with its vast kinetic energy.Other countries, including the United States, China, France and Germany, are also developing the technology, but Japan’s navy in 2023 claimed a world first by test-firing a railgun on a ship.”A railgun is a gun of the future that fires bullets with electrical energy, unlike conventional artillery,” an official from the Acquisition, Technology and Logistics Agency (ATLA) within Japan’s Ministry of Defence told AFP.”It is expected that threats that can only be dealt with by railguns will emerge in the future,” said the official, who did not want to be named.The three-day DSEI Japan Conference defence fair, which began on Wednesday, comes as Japan adopts a more assertive defence policy and looks to sell more military equipment to other countries.In particular, Japan’s Mitsubishi Heavy Industries (MHI) and Germany’s Thyssen Krupp Marine Systems (TKMS) are competing for a major contract to supply the Australian navy with new warships.Winning the multi-billion-dollar Project Sea 3000 contract to supply Australia with Mogami-class frigates would be Japan’s largest postwar military export order, according to Japanese media.

Equities and oil prices slid Thursday on concerns over the US economy as President Donald Trump tries to push through fresh tax cuts that risks sending the country’s deficit ballooning further.A weak auction of 20-year US government debt flashed a warning sign that the bond market was worried about the country’s finances, days after Moody’s lowered its top-tier credit rating for the world’s biggest economy.Big losses Wednesday on Wall Street carried over into Asian and European trading Thursday.The dollar remained under pressure despite rising against the euro and pound.The European currencies were hit by weak business activity data out of the eurozone and Britain.Bitcoin extended its record run higher, reaching an all-time high of almost $112,000.”The growing mountain of US debt is causing ripples of worry across financial markets,” noted Susannah Streeter, head of money and markets at Hargreaves Lansdown.”As the dollar has weakened, amid concerns about the US fiscal position, bitcoin has flexed even more muscle, as investors appear to be looking for alternatives to the greenback.” Streeter added that investors have “taken on more risk as relief still washes through financial markets that the trade war between China and the US has receded”.Bond yields have spiked across the board as investors demanded more interest for holding government debt.In the US, 30-year Treasuries hit their highest level since late 2023.The selling came after the auction of 20-year bonds attracted tepid interest and brought back memories of the sell-off that followed Trump’s “Liberation Day” tariff blitz last month.Trump is hoping to push through a mega-bill pairing tax relief with spending cuts that critics say would decimate health care and push up debt.”The proposed tax cuts are raising concerns from economists about the US fiscal position and there are signs of anxiety in the bond markets about the country’s debt burden,” said National Australia Bank’s Tapas Strickland.Oil prices extended losses Thursday as US debt concerns could weigh on crude demand.The commodity shed 1.7 percent, also after government data showing US crude stockpiles rose last week.Crude had rallied Wednesday on a CNN report that Israel was planning a strike on Iranian nuclear sites.- Key figures at around 1035 GMT -London – FTSE 100: DOWN 0.7 percent at 8,726.95 pointsParis – CAC 40: DOWN 1.0 percent at 7,833.06Frankfurt – DAX: DOWN 0.9 percent at 23,911.23Tokyo – Nikkei 225: DOWN 0.8 percent at 36,985.87 (close)Hong Kong – Hang Seng Index: DOWN 1.2 percent at 23,544.31 (close)Shanghai – Composite: DOWN 0.2 percent at 3,380.19 (close)New York – Dow: DOWN 1.9 percent at 41,860.44 (close)Euro/dollar: DOWN at $1.1298 from $1.1334 on WednesdayPound/dollar: DOWN at $1.3396 from $1.3421Dollar/yen: DOWN at 143.64 yen from 143.66 yenEuro/pound: DOWN at 84.31 pence from 84.42 penceWest Texas Intermediate: DOWN 1.7 percent at $60.51 per barrelBrent North Sea Crude: DOWN 1.7 percent at $63.80 per barrel

Equities sank and Treasuries remained under pressure on Thursday following sharp losses on Wall Street fuelled by US economy fears as Donald Trump tries to push through fresh tax cuts that could balloon the already huge deficit.A weak auction of 20-year US government debt flashed a warning sign that the bond market was worried about the country’s finances, days after Moody’s lowered its top-tier credit rating.The news brought an end to a healthy run-up in recent weeks that was stoked by the US-China tariff detente and signs of progress between the United States and other countries on trade.Bond yields spiked across the board as investors demanded more interest for holding government debt, signalling their fears about the world’s biggest economy — 30-year Treasuries hit their highest level since late 2023.The selling came after the auction of 20-year bonds attracted tepid interest and brought back memories of the sell-off that followed US President Trump’s “Liberation Day” tariff blitz last month, which was followed by the White House taking a less aggressive approach.All three main indexes on Wall Street ended sharply lower.A tax bill pushed by Trump that is currently going through Congress pairs an extension of the tax cuts from his first presidential term with steep savings in government spending to pay for them.But many market watchers do not expect the spending cuts in the package to be sufficient to offset the tax cuts, lifting the deficit.”The proposed tax cuts are raising concerns from economists about the US’s fiscal position and there are signs of anxiety in the bond markets about the country’s debt burden,” said National Australia Bank’s Tapas Strickland.Trump’s first-term treasury secretary, Steven Mnuchin, warned that “the budget deficit is a larger concern to me than the trade deficit” and called for more spending cuts.Asian and European equities also sank, with Tokyo, Hong Kong, Shanghai, Sydney, Seoul, Singapore, Taipei, Mumbai, Bangkok, Wellington and Manila all in the red.London, Paris and Frankfurt also dropped in the morning as data showed eurozone business activity contracted in May.The dollar also held losses against the yen on growing concerns about the US economy and as traders seek out the Japanese unit for its safe-haven status.- Bond market strife -Rania Gule, a senior market analyst at XS.com, said he expected to see the yen continue strengthening in the second quarter “unless there are major surprises in US monetary policy or unexpected economic developments”.He added that focus will now turn to US data, bonds, reactions to Trump’s tax plan, and the Bank of Japan’s next steps.”Regardless, the yen’s return to prominence not just as a haven, but as a fundamentally strong currency, has already begun — and is likely to continue,” he wrote.The uncertainty also helped revive demand for gold, another safe asset, which was sitting around $3,340 an ounce.And there are now fears that stocks could be in for another rough ride.”It took a day or two longer than I thought but it’s now in progress — stocks are starting to wake up to the strife in bond markets,” said Neil Wilson at Saxo.”Trouble has been brewing in the bond market for weeks and now it’s spread to the stock market. Worries about the US fiscal position and economy, with Donald Trump’s… tax bill about to be signed that will raise debt and possibly inflation, as well as a weak 20-year auction, pushing bond yields higher.”Stocks fell as investors realised this is not a drill – as heard on the floor earlier this week, they will break the equity market to save the bond market.”Still, bitcoin broke a fresh record of $111,878.25 as US lawmakers showed greater bipartisan support for a cryptocurrency bill on the regulation of so-called stablecoins, digital coins with value tied to the dollar.This has sparked fresh hopes for regulatory clarity in the sector, including for bitcoin, which is not directly linked to the dollar.Oil prices extended losses, giving up more than one percent, after data from the US Energy Information Administration showed the country’s stockpiles had risen last week.The news helped reverse a rally in the commodity on Wednesday that was sparked by a CNN report that Israel was planning a strike on Iranian nuclear sites.Worries about the economic outlook and the impact on future demand added to the selling pressure.- Key figures at around 0810 GMT -Tokyo – Nikkei 225: DOWN 0.8 percent at 36,985.87 (close)Hong Kong – Hang Seng Index: DOWN 1.2 percent at 23,544.31 (close)Shanghai – Composite: DOWN 0.2 percent at 3,380.19 (close)London – FTSE 100: DOWN 0.4 percent at 8,747.88Euro/dollar: DOWN at $1.1314 from $1.1334 on WednesdayPound/dollar: DOWN at $1.3425 from $1.3421Dollar/yen: DOWN at 143.06 yen from 143.66 yenEuro/pound: DOWN at 84.28 pence from 84.42 penceWest Texas Intermediate: DOWN 1.7 percent at $60.54 per barrelBrent North Sea Crude: DOWN 1.6 percent at $63.86 per barrelNew York – Dow: DOWN 1.9 percent at 41,860.44 (close)

Asian equities sank and Treasuries remained under pressure following sharp losses on Wall Street fuelled by US economy fears as Donald Trump tries to push through fresh tax cuts that could balloon the already huge deficit.A weak auction of 20-year US government debt flashed a warning sign that the bond market was worried about the country’s finances, days after Moody’s lowered its top-tier credit rating.The news brought an end to a healthy run-up in recent weeks that was stoked by the China-US tariff detente and signs of progress between the United States and other countries on trade.Bond yields spiked across the board as investors demanded more interest for holding government debt, signalling their fears about the world’s biggest economy — 30-year Treasuries hit their highest level since late 2023.The selling came after the auction of 20-year bonds attracted tepid interest, and brought back memories of the sell-off that followed US President Trump’s “Liberation Day” tariff blitz last month, which was followed by the White House taking a less aggressive approach.All three main indexes on Wall Street ended sharply lower.A tax bill pushed by Trump that is currently going through Congress pairs an extension of the tax cuts from Trump’s first presidential term with steep savings in government spending to pay for them.But many market watchers do not expect the spending cuts in the package to be sufficient to offset the tax cuts, lifting the deficit.”The proposed tax cuts are raising concerns from economists about the US’s fiscal position and there are signs of anxiety in the bond markets about the country’s debt burden,” said National Australia Bank’s Tapas Strickland.Trump’s first-term Treasury Secretary, Steven Mnuchin, warned that “the budget deficit is a larger concern to me than the trade deficit” and called for more spending cuts.Asian equities also sank, with Tokyo, Hong Kong, Shanghai, Sydney, Seoul, Taipei, Wellington and Manila all in the red.The dollar also held losses on growing concerns about the US economy, while the uncertainty helped revive demand for safe-haven gold, which was sitting around $3,340 an ounce.And there are now fears that stocks could be in for another rough ride.”These higher long-end yields make it a whole lot harder to justify today’s equity valuations,” said Stephen Innes at SPI Asset Management.”Tech and growth names — already stretched — are staring down the barrel of a tangible equity to rates market repricing, and this could cap the rally fuel that’s been driving risk assets since the April tariff detente.”Still, bitcoin broke a fresh record of $110,707 as US lawmakers showed greater bipartisan support for a cryptocurrency bill on the regulation of so-called stablecoins, digital coins whose value is tied to the dollar. This has sparked fresh hopes for regulatory clarity in the sector, including for bitcoin, which is not directly linked to the dollar.Oil prices extended losses after data from the US Energy Information Administration showed the country’s stockpiles had risen last week.The news helped reverse a rally in the commodity on Wednesday that was sparked by a CNN report that Israel was planning a strike on Iranian nuclear sites.- Key figures at around 0230 GMT -Tokyo – Nikkei 225: DOWN 0.9 percent at 36,967.13 (break)Hong Kong – Hang Seng Index: DOWN 0.4 percent at 23,733.67Shanghai – Composite: DOWN 0.1 percent at 3,383.87Euro/dollar: DOWN at $1.1332 from $1.1334 on WednesdayPound/dollar: UP at $1.3425 from $1.3421Dollar/yen: DOWN at 143.36 yen from 143.66 yenEuro/pound: DOWN at 84.40 pence from 84.42 penceWest Texas Intermediate: DOWN 0.6 percent at $61.21 per barrelBrent North Sea Crude: DOWN 0.6 percent at $64.54 per barrelNew York – Dow: DOWN 1.9 percent at 41,860.44 (close)London – FTSE 100: UP 0.1 percent at 8,786.46 (close)

Wall Street stocks tumbled Wednesday along with the dollar as a bond sell-off signaled investor unease while Congress weighs a tax-cut bill that could push up the US deficit.The yield on the 10-year US Treasury note approached 4.6 percent, its highest level since February, as Trump seeks to unify Republicans in the House of Representatives behind a sweeping bill that would slash taxes and roll back federal spending.Major US indices fell about 1.5 percent or more after a poor US Treasury auction sent bond yields sharply higher.”Investors are getting worried about the Trump tax bill that is working its way through Congress that is not going to be trimming the debt but actually adding to it,” said Sam Stovall of CFRA Research.”As a result, the bond yields have been moving higher and that is causing investors to be concerned.”Activity on Capitol Hill has taken center stage this week, while top finance leaders from the G7 group of nations gather in Canada for talks touching on the war in Ukraine and trade negotiations in the wake of Trump’s tariff onslaught.”A bond market crisis is exactly the sort of event that could send stocks tumbling and volatility surging,” said Kathleen Brooks, research director at XTB.”It’s also harder to recover from compared to the man-made tariff crisis,” she added.Bitcoin on Wednesday hit a new record high, of $109,499.76, as investors eyed new US legislation on cryptocurrency with optimism.In Europe, London’s FTSE closed slightly up, despite inflation data coming in higher than expected, which analysts said could slow the pace of interest rate cuts by the Bank of England.Germany’s DAX also ended in positive territory. But the CAC in Paris ended lower.An initial surge in crude prices spurred by a CNN report that Israel was planning a strike on Iranian nuclear sites reversed direction after a surprise announcement by the US Energy Information Administration that the country’s oil stocks had risen last week.Among individual companies, Google parent Alphabet bucked the tide, gaining 2.9 percent after announcing plans to include advertisements into its new AI Mode for online search.The integration of advertising has been a key question surrounding generative artificial intelligence chatbots, which have largely avoided interrupting the user experience with ads.Target fell 5.2 percent following another disappointing earnings release. The big-box chain, which is contending with tariffs and fallout from a boycott over its reversal on diversity pledges, reported a 2.8 percent drop in sales.- Key figures at around 2030 GMT -New York – Dow: DOWN 1.9 percent at 41,860.44 (close)New York – S&P 500: DOWN 1.6 percent at 5,844.61 (close) New York – Nasdaq Composite: DOWN 1.4 percent at 18,872.64 (close)London – FTSE 100: UP 0.1 percent at 8,786.46 (close)Paris – CAC 40: DOWN 0.4 percent at 7,910.49 (close)Frankfurt – DAX: UP 0.4 percent at 24,122.40 (close)Tokyo – Nikkei 225: DOWN 0.6 percent at 37,298.98 (close)Hong Kong – Hang Seng Index: UP 0.6 percent at 23,827.78 (close)Shanghai – Composite: UP 0.2 percent at 3,387.57 (close)Euro/dollar: UP at $1.1334 from $1.1283 on TuesdayPound/dollar: UP at $1.3421 from $1.3393Dollar/yen: DOWN at 143.66 yen from 144.51 yenEuro/pound: UP at 84.42 pence from 84.24 penceBrent North Sea Crude: DOWN 0.7 percent at $64.91 per barrelWest Texas Intermediate: DOWN 0.7 percent at $61.57 per barrel

Crude prices rallied Wednesday following a report that US intelligence suggested Israel was planning a strike on Iranian nuclear facilities, which would send geopolitical tensions into overdrive and fuel regional conflict fears.While safe haven gold pushed higher, the news from CNN appeared to be having little detrimental effect on Asian equities, with most extending the previous day’s rally.European stock markets faltered, however, with the Paris CAC 40 down almost one percent in midday deals.London fell and the pound strengthened against the dollar after UK inflation data come in well above forecasts in April.The dollar also lost pace against the euro and yen ahead of an upcoming G7 finance ministers meeting this week, with speculation growing that President Donald Trump is open to a weaker greenback to help US exporters.”Middle Eastern tensions are driving price action in the commodity space,” noted Kathleen Brooks, research director at XTB trading group.”Israel’s threat to strike Iran is causing this uplift,” she added.Investors are keeping tabs also on China-US relations after Beijing hit out at Washington’s “bullying” over chip export controls, just over a week after the two sides dialled down trade tensions by temporarily slashing tit-for-tat tariffs.Both main crude contracts jumped around one percent after CNN reported multiple US officials as saying the government had received intelligence indicating Israel was preparing to target Iranian atomic facilities.There are fears that such a sharp escalation could tip the Middle East into a war, with tensions already high over Israel’s strikes on Gaza.Trump said last week that “I think we’re getting close to maybe doing a deal” on Tehran’s nuclear programme and then a day later called on the Islamic republic to “move quickly or something bad is going to happen”.But Iran’s supreme leader Ayatollah Ali Khamenei warned Tuesday that nuclear talks with Washington were unlikely to yield any results after four rounds of Omani-mediated nuclear talks with the United States since April 12.”This is the clearest sign yet of how high the stakes are in the US Iran nuclear talks and the lengths Israel may go to if Iran insists on maintaining its commercial nuclear capabilities,” Robert Rennie, at Westpac Banking Corp, said.”Crude will maintain a risk premium as long as the current talks appear to be going nowhere.”Crude prices have risen around 15 percent since the start of the month on softening worries about the economic outlook as tariff tensions grow relatively calmer.- Key figures at around 1030 GMT -Brent North Sea Crude: UP 1.0 percent at $66.06 per barrelWest Texas Intermediate: UP 1.1 percent at $62.72 per barrelLondon – FTSE 100: DOWN 0.2 percent at 8,768.06 pointsParis – CAC 40: DOWN 0.8 percent at 7,880.58Frankfurt – DAX: DOWN 0.5 percent at 23,916.99Tokyo – Nikkei 225: DOWN 0.6 percent at 37,298.98 (close)Hong Kong – Hang Seng Index: UP 0.6 percent at 23,827.78 (close)Shanghai – Composite: UP 0.2 percent at 3,387.57 (close)New York – Dow: DOWN 0.3 percent at 42,677.24 (close)Euro/dollar: UP at $1.1359 from $1.1284 on TuesdayPound/dollar: UP at $1.3438 from $1.3391Dollar/yen: DOWN at 143.48 yen from 144.47 yenEuro/pound: UP at 84.53 pence from 84.26 pence

Chinese internet giant Baidu on Wednesday posted a quarterly revenue increase of three percent, as the firm seeks to grow its presence in artificial intelligence and expand its robotaxi business abroad.The Beijing-based firm operates China’s main search engine and has long been a key player in the domestic tech industry — but faces stiff competition both from traditional rivals like Tencent and Alibaba and a host of newer upstarts.Baidu derives a large part of its revenue from advertising, a sector vulnerable to fluctuations in consumer sentiment, and has sought to diversify with cloud computing, self-driving cars and AI.The firm achieved revenue of 32.45 billion yuan ($4.5 billion) in the first quarter of 2025, up 3 percent year-on-year, according to an earnings report released Wednesday on the Hong Kong Stock Exchange website.Net income during the first quarter reached 7.72 billion yuan, up 42 percent year-on-year.China’s consumer-facing AI sector attracted global attention after startup DeepSeek released a model that performed comparably to competitors such as US-made ChatGPT, apparently at a much lower developing cost.In March, Baidu announced the launch of its latest X1 reasoning model — which the company claims performs similarly to DeepSeek’s but for a lower cost — and a new foundation model, Ernie 4.5.Baidu has also axed subscriptions for its AI chatbot Ernie Bot, making it free for individual users.”We are confident that our AI-first strategy positions us to remain at the forefront and to capture long-term growth opportunities in the AI era,” said Robin Li, co-founder and CEO of Baidu, in the filing.”We also achieved a pivotal milestone in our robotaxi business, as Apollo Go expanded internationally,” Li added. In March Baidu announced it had signed an agreement to launch autonomous driving tests and services in Dubai, Apollo Go’s first international fleet deployment.The company also plans to start testing self-driving taxis in Europe by the end of this year, a source with knowledge of the matter confirmed to AFP earlier this month.The company will also start testing in Turkey, they said. 

The number of foreign visitors to Japan soared 28.5 percent in April year-on-year to a record 3.91 million, official figures showed Wednesday.”Spring cherry blossom season boosted demand for visits to Japan in many markets, as in the previous month, and overseas travel demand increased in some Asian countries, in Europe, the US and Australia to coincide with the Easter holidays,” the Japan National Tourism Organization said.It said the total surpassed the previous record of 3.78 million in January 2025 and was the highest single month on record, and the first single month to exceed 3.9 million visitors.For the first four months of the year the total was 14.4 million, a rise of 24.5 percent.A weak yen has for months been leading to a boom in visitors, with national tourism figures released in January showing a record of about 36.8 million arrivals last year.The Japanese government has set an ambitious target of almost doubling tourist numbers to 60 million annually by 2030.Authorities say they want to spread sightseers more evenly around the country, and to avoid a bottleneck of visitors eager to snap spring cherry blossoms or vivid autumn colours.But as in other global tourist magnets like Venice in Italy, there has been growing pushback from residents in destinations such as the ancient capital of Kyoto.The tradition-steeped city, just a couple of hours from Tokyo on the bullet train, is famed for its kimono-clad geisha performers and increasingly crowded Buddhist temples.On Mount Fuji, the nation’s highest mountain and a once-peaceful pilgrimage site, authorities have started charging climbers in an effort to reduce overcrowding.Last year a barrier was briefly erected outside a convenience store to stop people standing in the road to photograph a view of the snow-capped volcano that had gone viral.Business travellers in cities including Tokyo have complained that they have been priced out of hotels because of high demand from tourists.Tourists gobbling sushi and onigiri have also been cited as a factor in shortages of rice, which has pushed the price of the staple to record levels, creating a political headache for the government.This year the Japanese Meteorological Agency (JMA) on March 30 declared the country’s most common and popular “somei yoshino” variety of cherry tree in full bloom in Tokyo.Although this year’s blooming dates are around the average, the JMA says climate change and the urban heat-island effect are causing sakura to flower approximately 1.2 days earlier every 10 years.Katsuhiro Miyamoto, professor emeritus at Kansai University, estimated the economic impact of cherry blossom season in Japan, from travel to parties held under the flowers, at 1.1 trillion yen ($7.3 billion) this year, up from 616 billion yen in 2023.

South Korea’s exports fell 2.4 percent year-on-year in the first 20 days of May, partly due to weak sales to the United States after Washington imposed and then partly lifted sweeping tariffs, official data showed Wednesday.Last month, the country’s exports showed unexpected strength, lifted by robust semiconductor demand even as US tariffs weighed on trade.But early signs suggest that rising trade tensions are beginning to affect South Korea’s other key industries — including automobiles, which have been hit by a 25 percent levy.South Korea’s exports totalled $32 billion from May 1 to 20, down 2.4 percent from the same period last year, according to data from the Korea Customs Service.Shipments to the United States, Seoul’s key ally, fell 14.6 percent year-on-year during the period, while exports to China and the European Union also declined by 7.2 percent and 2.7 percent, respectively.Asia’s fourth-largest economy was hit with a 25 percent across-the-board tariff by the United States — although it was temporarily reduced to 10 percent for 90 days starting in early April.But specific 25 percent duties remain in place on key exports such as steel, aluminium and automobiles.Following a second round of ministerial-level trade talks last week, Seoul is now in working-level technical discussions with Washington, aiming to secure full tariff exemptions by finalising a trade package by early July.Shipments of semiconductors, South Korea’s biggest export, rose 17.3 percent year-on-year.Experts have suggested the rise in chip exports, including the high-tech ones needed for AI, could be due to stockpiling.But the country’s other key exports, cars and steel, fell on-year by 6.3 percent and 12.1 percent, respectively, during the May 1-20 period.The auto industry accounts for 27 percent of South Korea’s exports to the United States, which takes in nearly half of the country’s car exports.Exports of petroleum products, home appliances and wireless communication devices also all dropped, by 24.1 percent, 19.7 percent and 5.9 percent, respectively.Seoul aims to leverage the talks with Washington with commitments to purchase more US liquefied natural gas (LNG) and offer support in shipbuilding, a sector in which South Korea is a leader, after China.- Sharp slowdown -Cheong In-kyo, South Korea’s minister for trade, said for the entire month of May, the country’s “exports to the US and China are expected to decline as the impact of US tariff measures begins to materialise.”On the ongoing tariffs talks with Washington, Cheong said “we will actively engage … to find a mutually beneficial solution, with national interest as our top priority.”Seoul’s finance ministry announced Wednesday that it will deploy a total of 28.6 trillion won ($20.5 billion) in emergency liquidity and financial aid to support domestic firms impacted by US tariff measures.The amount marks an increase from the 25 trillion won announced by the government last month, but was part of an additional budget dedicated to easing tariff woes for the country’s exporters announced earlier this year. “The government is taking a preemptive approach to the impact of tariffs by formulating an all-ministry export strategy,” the ministry said in a statement.It is also “working to fundamentally strengthen the ecosystem of high-tech industries such as semiconductors, AI, and secondary batteries,” the ministry added.South Korea’s imports also fell 2.5 percent year-on-year to $32.2 billion in the first 20 days of May, resulting in a trade deficit of $300 million, according to the Korea Customs Service.Due to escalating tariffs, experts now expect a meagre 0.4 percent growth in exports for the Asia-Pacific region this year — a sharp slowdown from 5.7 percent in 2024, according to an APEC report released last week.

Beijing condemned on Wednesday new US warnings on the use of AI chips by Chinese tech giant Huawei, vowing it would take steps against “bullying” efforts to restrict access to high-tech semiconductors and supply chains.Washington has sought in recent years to curb exports of state-of-the-art chips to China, concerned that they could be used to advance Beijing’s military systems and otherwise undermine American dominance in AI.US President Donald Trump’s administration last week rescinded some export controls on advanced computing semiconductors, answering calls by countries that said they were being shut out from crucial technology needed to develop artificial intelligence.Some US lawmakers feared the restrictions would have incentivised countries to go to China for AI chips, spurring the superpower’s development of state-of-the-art technology.But Washington also unveiled fresh guidelines warning firms that using Chinese-made high-tech AI semiconductors, specifically tech giant Huawei’s Ascend chips, would put them at risk of violating US export controls.In a statement Wednesday, Beijing’s commerce ministry described the warnings as “typical unilateral bullying and protectionism, which seriously undermine the stability of the global semiconductor industry chain and supply chain”.China accused the US of “abusing export controls to suppress and contain China”.”These actions seriously harm the legitimate rights and interests of Chinese enterprises and endanger China’s development interests,” the commerce ministry said.It also warned that “any organization or individual that enforces or assists in enforcing such measures” could be in violation of Chinese law.And it vowed to take “firm steps to safeguard its legitimate rights and interests” in response.- Chips on the table -The United States warned last week about the potential consequences of allowing US AI chips to be used for training Chinese AI models.And those found using Huawei’s Ascend chips without clearance from Washington, the guidance read, can face “substantial criminal and administrative penalties, up to and including imprisonment, fines, loss of export privileges, or other restriction”.The US commerce department said its policy was aimed at sharing American AI technology “with trusted foreign countries around the world, while keeping the technology out of the hands of our adversaries”.Previous US rules divided countries into three tiers, each with its own level of restrictions.Top-tier countries like Japan and South Korea faced no export restrictions, while countries in the second tier, which included Mexico and Portugal, saw a cap on the chips they could receive.Chipmakers including Nvidia and AMD lobbied against the tiered restrictions and saw their share prices rise when the Trump administration indicated it would rethink the rule.Speaking at Taiwan’s top tech show on Wednesday, Nvidia CEO Jensen Huang described US export controls on AI chips to China as a “failure”, since companies are using locally developed technology. “The local companies are very, very talented and very determined, and the export control gave them the spirit, the energy and the government support to accelerate their development,” Huang said.