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Gold and silver hit record highs on Monday while equity markets fell after Donald Trump revived trade war fears by threatening several European nations with tariffs over their opposition to the United States buying Greenland.The US president has fanned already-rising geopolitical tensions this month by insisting that Washington would take control of the North Atlantic island, citing national security needs.And on Saturday, after talks failed to resolve “fundamental disagreement” over the Danish autonomous territory, he announced he would hit eight countries with fresh levies over their refusal to submit.He said he would impose 10 percent tariffs on Denmark, Norway, Sweden, France, Germany, the United Kingdom, the Netherlands and Finland from February 1 — rising to 25 percent from June 1 — if they did not agree to the takeover.The announcement drew an immediate response, with a joint statement from the countries saying: “Tariff threats undermine transatlantic relations and risk a dangerous downward spiral.”The move also threatened a trade deal signed between the United States and the European Union last year, with German Foreign Minister Johann Wadephul telling ARD television: “I don’t believe that this agreement is possible in the current situation.”Aides to French President Emmanuel Macron said he would ask the EU to activate a never-before-used “anti-coercion instrument” against Washington if Trump makes good on his threat.The measure allows for curbing imports of goods and services into the EU, a market of 27 countries with a combined population of 450 million.Bloomberg reported that member states were discussing the possibility of retaliatory levies on €93 billion ($108 billion) of US goods.The prospect of a trade war between the global economic heavyweights shook markets, with safe-haven assets extending gains that had come on the back of Trump’s threats against Iran last week and the US ouster of Venezuelan president Nicolas Maduro.Gold, a key go-to in times of turmoil, hit a peak of $4,690.59, while silver struck $94.12. On equity markets, Paris and Frankfurt opened more than one percent lower, while London was also deep in the red.Tokyo, Hong Kong, Sydney, Singapore, Manila, Mumbai and Wellington retreated, though there were gains in Shanghai, Seoul, Taipei and Bangkok.US futures sank.The dollar also retreated against its peers, with the euro, sterling and yen all higher.”The next signpost is whether this moves from rhetoric to policy, and that is why the concrete dates matter,” wrote Charu Chanana, chief investment strategist at Saxo Markets.”On the European side, the decision path matters as much as the headline, because there is a difference between merely mentioning the anti-coercion instrument as a signal and formally pursuing it as action.”Even if the immediate tariff threat gets negotiated down, the structural risk is that fragmentation keeps rising, with more politicised trade, more conditional supply chains, and higher policy risk for companies and investors.”There was little major reaction to data showing China’s economy expanded five percent last year, in line with its target, but one of the slowest rates in decades. Growth in the final three months slowed sharply from the previous quarter.The figures showed that exports continued to provide the main basis of growth as domestic consumption remained subdued, putting pressure on officials to provide more stimulus.Sarah Tan, an economist at Moody’s Analytics, wrote: “China enters 2026 with confidence still fragile, the property downturn unresolved, and the external environment turning more hostile. “The property slump is set to extend into the year, which will weigh on households and manufacturers alike. Meanwhile, the (trade) truce with the US is time-limited and set to expire before the end of 2026, putting both talks and friction on the horizon.”As a result, China begins 2026 with as much uncertainty as it faced at the start of 2025.”Investors in Seoul and Taipei brushed off a warning from US Commerce Secretary Howard Lutnick that South Korean chipmakers and Taiwan firms not investing in the United States could be hit with 100 percent tariffs unless they boost output in the country.- Key figures at around 0815 GMT -Frankfurt – DAX: DOWN 1.5 percent at 24,927.07 Paris – CAC 40: DOWN 1.7 percent at 8,121.61London – FTSE 100: DOWN 0.4 percent at 10,191.20 Tokyo – Nikkei 225: DOWN 0.7 percent at 53,583.57 (close)Hong Kong – Hang Seng Index: DOWN 1.1 percent at 26,563.90 (close)Shanghai – Composite: UP 0.3 percent at 4,114.00 (close)Euro/dollar: UP at $1.1628 from $1.1604 on FridayPound/dollar: UP at $1.3390 from $1.3382Dollar/yen: DOWN at 158.02 yen from 158.07 yenEuro/pound: UP at 86.83 pence from 86.69 penceWest Texas Intermediate: DOWN 0.6 percent at $59.07 per barrelBrent North Sea Crude: DOWN 0.7 percent at $63.69 per barrelNew York – Dow: DOWN 0.2 percent at 49,359.33 (close)

In a dimly lit workshop in eastern China, craftsman Zhang measured and shaped a block of wood into a foot as dozens of half-completed life-sized Buddha statues looked on silently.Zhang is one of a dwindling number of master woodcarvers in the village of Chongshan near the city of Suzhou, where generations of residents have made a living creating Buddhist and Taoist sculptures for display in temples across China.Carving the intricate statues, which are often adorned with bright paint and gold leaf, was an art he learned from his father as a teenager.”My grandpa and my grandpa’s grandpa were also craftspeople,” Zhang told AFP in his dusty studio.But “once our generation retires, there will be no one left to carry on the tradition”.He blamed a combination of unattractive pay and youngsters’ unwillingness to dedicate time and energy to mastering the craft.”You need to do this for at least five or six years before you can set up shop on your own.”Zhang said the village had received a boom in orders starting in the late 20th century, after a loosening of tight government restrictions on worship led to a resurgence of interest in religion across the country.But now, fewer people are commissioning new pieces with the market already “saturated” and most temples around the country already furnished with statues, Zhang told AFP.Gu, a 71-year-old artisan at another workshop in Chongshan, said she remembered producing secular handicrafts during the Cultural Revolution, when religion was considered an archaic relic to be eliminated from society by leader Mao Zedong’s followers.”At the time, the temples were all closed,” Gu told AFP.Gu, who specialises in carving the heads of Buddha sculptures, proudly showed off the subtle expressions on the faces of a row of gilded figures in her storeroom.”Every face has an expression, smiling or crying,” Gu said.She grinned as she explained that some sculptures of famed Buddhist monk Ji Gong even showed him smiling on one side of his face and frowning on the other.In comparison, wood carver Zhang took a more practical view of his craft.”People look at us like we’re artists,” he said. “But to us, we’re just creating a product.” 

Philippines President Ferdinand Marcos said Monday that a “significant” discovery of natural gas had been made near the country’s sole producing offshore site.About 98 billion cubic feet (2.8 billion cubic metres) of natural gas — enough to provide power to 5.7 million homes for a year — has been found east of the Malampaya Field near the island of Palawan, Marcos said.The Philippines has some of the region’s highest energy costs and faces a looming crisis as the Malampaya gas field, which supplies about 40 percent of power to the archipelago’s main island, Luzon, is expected to run dry within a few years.The discovery — five kilometres (three miles) east of the Malampaya Field  — is the first in more than a decade and suggested the potential to produce even more, Marcos said.”This helps Malampaya’s contribution and strengthens our domestic gas supply for many years to come. Initial testing showed that the well flowed at 60 million cubic feet per day,” Marcos said in a statement.The Philippines — regularly affected by electricity outages — relies on imported carbon-belching coal for more than half of its power generation.Kairos Dela Cruz, executive director of the Manila-based Institute for Climate and Sustainable Cities, told AFP that while the find was “relatively small”, it could point the way to finding other nearby gas resources.”The discovery of these other gas fields will provide new indigenous supply and increase energy security,” he said.”It also helps extend the operating life of the 500-kilometre undersea gas pipeline, long enough for larger gas fields in the area to be discovered.”A former industry executive who spoke on condition of anonymity estimated the new find could extend the Malampaya Field’s life by two to three years.Long-term, the country will still need to increase its focus on renewables ranging from solar to hydro to offshore wind projects, Dela Cruz said.In 2022, then-president Rodrigo Duterte called a halt to oil and gas exploration in areas of the South China Sea disputed with China.Beijing has ignored a 2016 international tribunal decision that declared its historical claim over most of the South China Sea to be without basis.

Gold and silver hit record highs Monday while most equity markets fell after Donald Trump revived trade war fears by threatening several European nations with tariffs over their opposition to the United States buying Greenland.The US president has fanned already-rising geopolitical tensions this month by insisting that Washington would take control of the North Atlantic island, citing national security needs.And on Saturday, after talks failed to resolve “fundamental disagreement” over the Danish autonomous territory, he announced he would hit eight countries with fresh levies over their refusal to submit to his demands.He said he would impose 10 percent tariffs on Denmark, Norway, Sweden, France, Germany, the United Kingdom, the Netherlands and Finland from February 1 — rising to 25 percent from June 1 — if they did not agree to the takeover.The announcement drew an immediate response, with a joint statement from the countries saying: “Tariff threats undermine transatlantic relations and risk a dangerous downward spiral.”The move also threatened a trade deal signed between the United States and European Union last year, with German Foreign Minister Johann Wadephul telling ARD television: “I don’t believe that this agreement is possible in the current situation.” Meanwhile, aides to French President Emmanuel Macron said he would ask the EU to activate a never-before-used “anti-coercion instrument” against Washington if Trump makes good on his threat.This measure allows for curbing imports of goods and services into the EU, a market of 27 countries with a combined population of 450 million.Bloomberg reported member states were discussing the possibility of retaliatory levies on €93 billion ($108 billion) of US goods.The prospect of a trade war between the global economic heavyweights shook markets, with safe haven assets extending gains that had come on the back of Trump’s threats against Iran last week and the US ouster of Venezuelan president Nicolas Maduro.Gold, a key go-to in times of turmoil, hit a peak of $4,690.59, while silver struck $94.12. On equity markets, Tokyo, Hong Kong, Shanghai, Sydney, Singapore and Wellington retreated, though there were gains in Seoul and Taipei.European and US futures sank.The dollar also retreated against its peers, with the euro, sterling and yen all higher.”The next signpost is whether this moves from rhetoric to policy, and that is why the concrete dates matter,” wrote Charu Chanana, chief investment strategist at Saxo Markets.”On the European side, the decision path matters as much as the headline, because there is a difference between merely mentioning the anti-coercion instrument as a signal and formally pursuing it as action.”Even if the immediate tariff threat gets negotiated down, the structural risk is that fragmentation keeps rising, with more politicised trade, more conditional supply chains, and higher policy risk for companies and investors.”There was little major reaction to data showing China’s economy expanded five percent last year, in line with its target. However, growth in the final three months slowed sharply from the previous quarter.Investors in Seoul and Taipei brushed off a warning from US Commerce Secretary Howard Lutnick that South Korean chipmakers and Taiwan firms not investing in the United States could be hit with 100 percent tariffs unless they boost output in the country.- Key figures at around 0230 GMT -Tokyo – Nikkei 225: DOWN 1.0 percent at 53,412.88 (break)Hong Kong – Hang Seng Index: DOWN 0.7 percent at 26,670.01Shanghai – Composite: DOWN 0.1 percent at 4,099.23Euro/dollar: UP at $1.1628 from $1.1604 on FridayPound/dollar: UP at $1.3397 from $1.3382Dollar/yen: DOWN at 157.54 yen from 158.07 yenEuro/pound: UP at 86.79 pence from 86.69 penceWest Texas Intermediate: UP 0.1 percent at $59.52 per barrelBrent North Sea Crude: FLAT at $64.15 per barrelNew York – Dow: DOWN 0.2 percent at 49,359.33 (close)London – FTSE 100: FLAT at 10,235.29 (close)

China’s economy expanded five percent in 2025, Beijing said Monday, one of its slowest rates of growth in decades as it struggles with persistently low consumer spending and a debt crisis in its property sector.Leaders set a growth target of “around five percent” for last year, following a five percent rise in 2024.The economy grew at 4.5 percent between October and December last year, in line with expectations but marking a significant slowdown towards the end of the year.While China’s GDP grew enough for officials to declare victory, analysts warn that growth has been uneven and figures mask weak sentiment on the ground.Chinese consumers remain jittery about the wider economy and high unemployment, even though officials have relaxed fiscal policy and subsidised the replacement of household items in a sputtering bid to boost spending.Retail sales, a key indicator of consumption, rose 0.9 percent year-on-year in December — the weakest pace since the end of 2022, when stringent zero-Covid measures ended.Last month’s sales were worse than the 1.3 percent year-on-year growth recorded in November, extending a months-long slowdown.China’s crucial property sector was once a major indicator of the country’s economic strength.But in recent years it has failed to overcome a flagging debt crisis despite rate cuts and loosened restrictions on homebuying.Fixed-asset investments in China shrunk 3.8 percent year-on-year in 2025, an inevitable rebalancing following a property and infrastructure boom in recent decades.Real estate investment was down 17.2 percent last year.House prices have risen slightly in some large cities but the broader market remains sluggish.Last year also saw the return of Donald Trump to the White House and the revival of a fierce trade war between the world’s two largest economies.Chinese President Xi Jinping and Trump reached a tentative truce to their fierce trade war when they met in late October, agreeing a pause to painful measures that included lofty tit-for-tat tariffs.Official data showed Chinese exports to the United States plunged by 20 percent in 2025, but that had little impact on demand for Chinese products elsewhere.Robust exports remained a bright spot in the cloudy economic picture despite that bruising trade war.China’s trade surplus hit a record $1.2 trillion last year, with officials lauding a “new historical high” filled by other trade partners.Shipments to the ASEAN group of Southeast Asian nations rose 13.4 percent year-on-year, while exports to Africa saw 25.8 percent growth.Exports to the European Union were also up 8.4 percent, though imports from the bloc dipped.

Stock markets mostly retrenched on Friday at the end of a week jam-packed with geopolitical developments, content to languish after record-breaking performances in recent days.Wall Street stocks followed European bourses into the red at the end of the session, with investors in no mood to take fresh positions.Major US exchanges will be closed Monday over the Martin Luther King Jr. Day.”The fact that US markets will be closed until Tuesday in the face of a rancorous geopolitical environment is probably also acting as a holdback provision,” said a note from Briefing.com analyst Patrick O’Hare.Headlines focused on the President Donald Trump’s response to Iran’s crackdown on protesters, his administration’s designs on taking over Greenland and plans for Venezuela’s oil.US indices finished the week with modest losses. The S&P 500 concluded Friday’s session at 6,940.01, down 0.1 percent for the day and 0.4 percent for the week.Next week’s agenda includes earnings from Netflix, United Airlines and Procter & Gamble. Analysts expect companies in the S&P 500 to report 8.2 percent earnings growth in the fourth-quarter compared with the year-ago period, according to FactSet.”We’re being reminded that Wall Street cares more about the bottom line than it does about headlines,” said CFRA Research’s Sam Stovall.Stovall also flagged US inflation data next week as a key input as far as what to expect from the Federal Reserve.In commodities trading, oil prices rebounded after shedding five percent Thursday as US President Donald Trump appeared to step back from military action against Iran, a major producer of crude oil.- Key figures at around 2115 GMT -New York – Dow: DOWN 0.2 percent at 49,359.33 (close)New York – S&P 500 : DOWN 0.1 percent at 6,940.01 (close)New York – Nasdaq: UP 0.2 percent at 23,515.39 (close)London – FTSE 100: DOWN less than 0.1 percent at 10,235.29 (close)Frankfurt – DAX: DOWN 0.2 percent at 25,297.13 (close)Paris – CAC 40: DOWN 0.7 percent at 8,258.94 (close)Tokyo – Nikkei 225: DOWN 0.3 percent at 53,936.17 (close)Hong Kong – Hang Seng Index: DOWN 0.3 percent at 26,844.96 (close)Shanghai – Composite: DOWN 0.3 percent at 4,101.91 (close)Euro/dollar: DOWN at $1.1604 from $1.1609 on ThursdayPound/dollar: UP at $1.3382 from $1.3381Dollar/yen: DOWN at 158.07 yen from 158.63 yenEuro/pound: DOWN 86.69 from 86.75 penceBrent North Sea Crude: UP 0.6 percent at $64.13 per barrelWest Texas Intermediate: UP 0.4 percent at $59.44 per barrelburs-jmb/bgs

Canada’s Prime Minister Mark Carney and Chinese President Xi Jinping agreed on a raft of measures from trade to tourism on Friday at the first meeting between the countries’ leaders in Beijing in eight years.The Canadian leader hailed a “landmark deal” under a “new strategic partnership” with China, turning the page on years of diplomatic spats, tit-for-tat arrests and tariff disputes.Carney has sought to reduce his country’s reliance on the United States, its key economic partner and traditional ally, as President Donald Trump has aggressively raised tariffs on Canadian products.”Canada and China have reached a preliminary but landmark trade agreement to remove trade barriers and reduce tariffs,” Carney told a news conference after meeting with Xi.Under the deal, China — which used to be Canada’s largest market for canola seed — is expected to reduce tariffs on canola products by March 1 to around 15 percent, down from the current 84 percent.China will also allow Canadian visitors to enter the country visa‑free.In turn, Canada will import 49,000 Chinese electric vehicles (EVs) under new, preferential tariffs of 6.1 percent.”This is a return to the levels that existed prior to recent trade frictions,” Carney said of the EV deal.Trump, who has cut off trade talks with Ottawa and insists the United States does not need any products from its northern neighbour, told reporters it was “good” that Carney had secured an agreement during his trip.”If he can get a trade deal with China, he should do that,” the president said.The head of the Canola Council of Canada, Chris Davison, called the deal an “important milestone”.But the Global Automakers of Canada, an industry group, voiced concern.The deal may be an “expression of goodwill” to ease pressure on the canola industry, but allowing thousands of Chinese EVs into Canada at a low tariff rate “risks creating significant market distortions” and could hurt companies that employ Canadians, the group said.- ‘Right track’ -Welcoming Carney in the Great Hall of the People, Xi said China-Canada relations reached a turning point at their last meeting on the sidelines of the APEC summit in October.”It can be said that our meeting last year opened a new chapter in turning China-Canada relations toward improvement,” Xi told the Canadian leader.”The healthy and stable development of China-Canada relations serves the common interests of our two countries,” he said, adding he was “glad” to see discussions over the last few months to restore cooperation.Ties between the two nations withered in 2018 over Canada’s arrest of the daughter of Huawei’s founder on a US warrant, and China’s retaliatory detention of two Canadians on espionage charges.The two countries imposed tariffs on each other’s exports in the years that ensued, with China also accused of interfering in Canada’s elections.But Carney has sought a pivot, and Beijing has also said it is willing to get relations back on “the right track”.The Canadian leader, who on Thursday met with Premier Li Qiang, is also scheduled to hold talks with business leaders to discuss trade.Canada, traditionally a staunch US ally, has been hit especially hard by Trump’s steep tariffs on steel, aluminium, vehicles and lumber.Washington’s moves have prompted Canada to seek business elsewhere.In October, Carney said Canada should double its non-US exports by 2035 to reduce reliance on the United States.But the United States remains far and away its largest market, buying around 75 percent of Canadian goods in 2024, according to Canadian government statistics.While Ottawa has stressed that China is Canada’s second-largest market, it lags far behind, buying less than four percent of Canadian exports in 2024.

Major stock markets in Europe and Asia mostly fell along with the dollar Friday as focus returned to trade deals and the AI sector at the end of a week dominated by big swings for oil prices.Taiwan vowed to remain the world’s “most important” maker of chips for artificial intelligence after reaching a trade deal with the United States that will reduce tariffs on the island’s shipments and increase Taiwanese investment on US soil.It comes one day after Taiwanese chipmaking titan TSMC posted a jump in profits, bolstering confidence that massive AI investments will pay off.”The surge in demand for AI products manufactured by TSMC has pricked up the ears of the US administration,” said Susannah Streeter, chief investment strategist at Wealth Club.”The AI juggernaut clearly has further to run, with demand for AI chips seemingly insatiable for now,” she added. Taipei’s stock market closed up two percent Friday, while shares in TSMC advanced three percent.On Thursday, Wall Street’s tech-rich Nasdaq index had piled on more than one percent early in the session thanks to gains among leading chip companies. But later in the day there was “kind of a roll-back in the megacap stock and semiconductors”, said Briefing.com analyst Patrick O’Hare.That followed remarks from US Commerce Secretary Howard Lutnick indicating that semiconductor companies that do not build plants in the United States could face 100 percent tariffs, though the three main Wall Street indices finished moderately higher.Elsewhere on the international trade front, Canada’s Prime Minister Mark Carney and Chinese President Xi Jinping agreed Friday on a raft of measures at the first meeting between the countries’ leaders in Beijing in eight years.Carney hailed a “landmark deal” under a “new strategic partnership”, turning the page on years of diplomatic spats, retaliatory arrests of each country’s citizens and tariff disputes.In commodities trading, oil prices rebounded after shedding five percent Thursday as US President Donald Trump stepped back from military action in crude producer Iran.- Key figures at around 1115 GMT -London – FTSE 100: UP 0.1 percent at 10,248.80 pointsFrankfurt – DAX: DOWN 0.2 percent at 25,305.75Paris – CAC 40: DOWN 0.5 percent at 8,271.69Tokyo – Nikkei 225: DOWN 0.3 percent at 53,936.17 (close)Hong Kong – Hang Seng Index: DOWN 0.3 percent at 26,844.96 (close)Shanghai – Composite: DOWN 0.3 percent at 4,101.91 (close)New York – Dow: UP 0.6 percent at 49,442.44 (close) Euro/dollar: UP at $1.1614 from $1.1605 on ThursdayPound/dollar: UP at $1.3406 from $1.3377Dollar/yen: DOWN at 158.10 yen from 158.63 yenEuro/pound: DOWN 86.64 from 86.75 penceBrent North Sea Crude: UP 1.1 percent at $64.48 per barrelWest Texas Intermediate: UP 1.2 percent at $59.75 per barrel

Asian markets were mixed Friday after Taiwanese chipmaking titan TSMC posted a big profit jump, bolstering confidence in the artificial intelligence sector as the United States struck a trade deal with the self-ruled island.It came after Wall Street rebounded following two down days, while oil steadied as President Donald Trump stepped back from military action in Iran.Taipei stocks surged two percent after the government agreed with Washington to boost Taiwanese chipmaking investments in the United States, which will cut tariffs.Taiwan will remain the world’s “most important” producer of the advanced chips that power AI tools, the island’s Economic Affairs Minister Kung Ming-hsin said.Some market-watchers fear the bubble of excitement around AI, which has pushed global markets to record highs, could burst and cause a stock rout.But TSMC, the world’s biggest contract maker of chips, announced Thursday a forecast-busting net profit for the fourth quarter — seen as a sign of sustained global demand for AI technology.The company’s shares jumped 4.4 percent on Wall Street, and rose three percent Friday in Taipei.Analyst Gavin Friend said TSMC’s strong annual capital expenditure forecast in particular would reassure those concerned over how long the AI boom can last.”Increasingly, investors have been questioning the extent of the capex drive into data centres,” he told the National Australia Bank’s Morning Call podcast.”I think the most important thing — and they (TSMC) pretty much exceeded on everything — was the upbeat outlook on things like capex, expected to be significantly higher over the next three years,” he said.”That’s given AI and tech stocks a much-needed shot in the arm.”- Oil steady -The news spurred US markets, with the tech-rich Nasdaq piling on more than one percent early in the session behind large gains among leading chip firms.But later in the day there was “kind of a roll-back in the megacap stock and semiconductors”, said Briefing.com analyst Patrick O’Hare.This weakening came after US Commerce Secretary Howard Lutnick indicated that semiconductor companies that do not build in the United States could face 100 percent tariffs.In Asia, traders were watching Tokyo ahead of a week that brings a Bank of Japan policy decision and Prime Minister Sanae Takaichi’s expected snap election announcement.The yen has softened against the dollar on reports that the Bank of Japan will keep its monetary policy unchanged, said Kyle Rodda, senior market analyst at Capital.com.That “adds to downside pressures on the currency, with a looming election, called to gain a mandate for very expansionary fiscal policy, also a critical headwind”, Rodda said.Traders are alert to the possibility of a government intervention to prop up the yen’s value, Rodda added.Tokyo and Shanghai closed 0.3 percent down, while Hong Kong, Manila and Kuala Lumpur also posted losses.Sydney, Wellington, Mumbai, Jakarta, Bangkok and Singapore were all up, and tech highflier Seoul gained 0.9 percent.Oil prices continued to steady as Washington distanced itself from military intervention in Iran.The United States on Thursday said Iran halted 800 executions of protesters under pressure from Trump, after Gulf allies appeared to pull him back from military action over Tehran’s deadly crackdown on demonstrations.- Key figures at around 0700 GMT -Tokyo – Nikkei 225: DOWN 0.3 percent at 53,936.17 (close)Hong Kong – Hang Seng Index: DOWN 0.6 percent at 26,776.06Shanghai – Composite: DOWN 0.3 percent at 4,101.91 (close)Euro/dollar: UP at $1.1610 from $1.1605 on ThursdayPound/dollar: UP at $1.3382 from $1.3377Dollar/yen: DOWN at 158.34 yen from 158.63 yenEuro/pound: FLAT at 86.75 penceWest Texas Intermediate: UP 0.3 percent at $59.36 per barrelBrent North Sea Crude: UP 0.2 percent at $63.86 per barrelNew York – Dow: UP 0.6 percent at 49,442.44 (close) London – FTSE 100: UP 0.5 percent at 10,238.94 (close)

Taiwan vowed Friday to remain the world’s “most important” AI chipmaker, after reaching a trade deal with the United States that will reduce tariffs on the island’s shipments and increase Taiwanese investment on US soil.Taiwan is a powerhouse in producing chips — a critical component in the global economy — but the United States wants more of the technology made in America.The agreement “will drive a massive reshoring of America’s semiconductor sector,” the US Commerce Department said.Under the deal, Washington will lower tariffs on Taiwanese goods to 15 percent, down from a 20 percent “reciprocal” rate meant to address US trade deficits and practices it deems unfair.Taiwanese Premier Cho Jung-tai praised negotiators Friday for “delivering a well-executed home run” following months of talks.”These results underscore that the progress achieved so far has been hard-won,” Cho said.Taiwan’s dominance of the chip industry has long been seen as a “silicon shield” protecting it from an invasion or blockade by China — which claims the island is part of its sovereign territory — and an incentive for the United States to defend it.But the threat of a Chinese attack has fuelled concerns about potential disruptions to global supply chains, increasing pressure for more chip production beyond Taiwan’s shores.”Based on current planning, Taiwan will still remain the world’s most important producer of AI semiconductors, not only for Taiwanese companies, but globally,” Taiwanese Economic Affairs Minister Kung Ming-hsin assured reporters on Friday.Production capacity for the advanced chips that power artificial intelligence systems will be split about 85-15 between Taiwan and the United States by 2030 and 80-20 by 2036, he projected.China’s foreign ministry said it “resolutely opposes” the deal. – ‘New, direct investments’ -The deal will need to be approved by Taiwan’s opposition-controlled parliament where lawmakers have expressed concern about the potential for Taiwan to lose its chip dominance.Cheng Li-wun, chairperson of the Kuomintang party which advocates closer ties with Beijing, criticised the deal.She said that increasing Taiwanese investment in US chip production capacity risked “hollowing out” the island’s economy.Sector-specific tariffs on Taiwanese auto parts, timber, lumber and wood products will also be capped at 15 percent, while generic pharmaceuticals and certain natural resources will face no “reciprocal” duties, the US Commerce Department said.Meanwhile, Taiwanese chip and tech businesses are set to make “new, direct investments totalling at least $250 billion” in the United States to build and expand capacity in areas like advanced semiconductors and AI, the department said.Taiwan will also provide “credit guarantees of at least $250 billion to facilitate additional investment by Taiwanese enterprises,” it said, adding that this would support the growth of the US semiconductor supply chain.Taiwan’s government said the new tariff will not stack on top of existing duties, which had been a major concern for local industries.”Of course it’s good that the reciprocal tariff has been lowered to 15 percent — at least it puts us on par with our main competitors South Korea and Japan,” said Chris Wu, sales director for Taiwanese machine tool maker Litz Hitech Corp.But, given the company’s single-digit profit margins, “there is no way we can absorb the tariff” for US customers, he said.- TSMC -More than half of Taiwan’s exports to the United States are information and communications technology products — including semiconductors.”The objective is to bring 40 percent of Taiwan’s entire supply chain and production, to domestically bring it into America,” US Commerce Secretary Howard Lutnick told CNBC.”We’re going to bring it all over, so we become self-sufficient in the capacity of building semiconductors,” he added.The announcement did not mention names, but the deal has key implications for Taiwanese chipmaking titan TSMC, which last year pledged to spend an additional $100 billion on US plants.Frenzied demand for AI technology has sent profits skyrocketing for the company, the world’s biggest contract maker of chips used in everything from Apple phones to Nvidia’s cutting-edge AI hardware.”As a semiconductor foundry serving customers worldwide, we welcome the prospect of robust trade agreements between the United States and Taiwan,” TSMC said in a statement Friday.”Strengthened trade relations are essential for advancing future technologies and ensuring a resilient semiconductor supply chain.”Lutnick said TSMC has bought land and could expand in Arizona as part of the deal.”They just bought hundreds of acres adjacent to their property. Now I’m going to let them go through it with their board and give them time,” he told CNBC.Taiwanese producers who invest in the United States will be treated more favorably when it comes to future semiconductor duties, the US Commerce Department said.A day prior, US officials held off imposing wider chip tariffs, instead announcing a 25 percent duty on certain semiconductors meant to be shipped abroad — a key step in allowing US chip giant Nvidia to sell AI chips to China.