Top News
US, EU reach accord on trade deal with 15 percent tariffs
The US and EU announced a trade deal that will impose US tariffs of 15 percent on imports from the 27-member block and require the EU to open its markets wider to US goods. It also contains provisions for the EU to increase investment in the US by US$600 billion and buy more US military equipment and energy. The deal is a breakthrough in President Donald Trump's efforts to reshape global trade; the US and EU are one another's largest trading partners, accounting for a third of global trade.
The agreement was announced after a face-to-face meeting between Trump and EU Commission President Ursula Von der Leyen in Scotland on Sunday. The 15 percent tariff in the plan includes duties on cars, pharmaceuticals and semiconductors, and is half what Trump was threatening to impose if a deal weren't struck by August 1. Von der Leyen said it was the "best we could get."
A 50 percent US tariff on steel and aluminum will remain in place, but she said that could be cut and replaced with a quota system.
Trump said the US is "very close" to reaching a trade deal with China as talks between both sides resume today in Sweden.
Thailand, Cambodia to talk in Malaysia
Thailand and Cambodia have agreed to hold talks in Malaysia on Monday after four days of cross-border fighting, according to Thai officials. Thailand said acting Prime Minister Phumtham Wechayachai will lead the Thai delegation and Cambodian Prime Minister Hum Manet is also expected to attend. The worst violence between the two Southeast Asian neighbors in 13 years is related to a longstanding border dispute and has left more than 30 people dead and 130,000 displaced.
China proposes multilateral path on AI development
China unveiled a 13-point action plan on artificial intelligence that includes a proposal for the formation of a multinational group to foster global integration of AI development and regulation. The plan was announced by Premier Li Qiang in opening remarks at the World Artificial Intelligence Conference in Shanghai. China has suggested Shanghai host the organization. The China plan contrasts with an aggressive action plan announced by the White House last week that takes a unilateral approach aimed at propelling the US AI industry into dominance over China. In his speech, Li said China seeks to help other nations, especially poorer ones, adopt AI technologies.
Prominent scientists and AI industry leaders attending the conference lent their voices to the call for global cooperation. Nobel laureate Geoffrey Hinton, considered the "godfather of AI,' likened the technology to a "cute tiger cub" that can become dangerous as it matures. He said a shared commitment to ensure its safe development is critical. Stuart Russel, a University of California computer sciences professor, warned against a pointless "arms race" mentality in the development of AI.
Among the displays at the AI conference this weekend, over 150 humanoid robots highlighted China's rapid advances in robotics.
Israel loosens controls over aid to Gaza
Under mounting international pressure over mass hunger and Gazans dying of starvation, Israel began pauses in military operations for 10 hours a day in parts of the coastal enclave, said it will establish humanitarian corridors for UN food convoys and began aerial dropping of aid in densely populated areas. Countries including the UK and Jordan are participating in aerial aid drops, though nonprofit aid agencies said such measures inefficient and fall far short of meeting the need. Many countries and aid organizations around the world blame Israel for the food crisis, but Israel denies the accusations and blames Hamas.
Top Business
Pfizer, 3SBio seal largest China biotech licensing deal
China's 3SBio and US-based Pfizer completed the largest foreign licensing agreement to date in China's biotech industry. Under the deal, Pfizer will pay Hong Kong-listed 3Sbio a US$1.25 billion upfront payment for the rights to its SSGJ-707 cancer drug outside of China, buy a 1.3 percent equity stake in S3Bio for HK$785 million (US$100 million), and pay US$150 million for the option to extend the license to include exclusive development and marketing rights in China.
Plan to boost demand for farm products
China's agriculture ministry and nine other government departments unveiled a plan on Sunday to bolster the farm sector by encouraging expansion of specialty, organic and premium crops. It also focuses on enhancing certification standards and product grading. To improve the efficiency of the supply chain from farmgate to dinner tables, the plan calls for technological upgrading of processing plants and expansion of both online and offline sales networks. As a corollary to the plan, the government agencies said they will support public campaigns for healthy eating.
Economy & Markets
Industrial profits narrow decline in June
Profits in China's major industries firms in June fell 4.3 percent from a year earlier but narrowed from a 4.8 percent decline in May on gains in advanced electronics and green manufacturing sectors, according to the National Bureau of Statistics. Aggregate revenue in the month was up 1 percent. Industrywide profits totaled 715.58 billion yuan (US$99 billion) in June, with manufacturing posting a 1.4 percent increase. For the first half, industrial profits dropped 1.8 percent from a year earlier.
China bond proceeds go to consumer trade-in subsidies
China allocated the proceeds of a third tranche of 69 billion yuan (US$9.7 billion) ultra-long special government bond funds to support the country's consumer goods trade-in program, the Ministry of Finance said. Some 300 billion yuan has been earmarked this year for the program, which subsidizes the trade-in of old model goods for new and is aimed at spurring consumer spending. As of July 16, 280 million people had applied for the subsidies.
Lucrative summer at the flicks
China's summer cinema box office surpassed 5 billion yuan (US$615 million) this weekend, with popular attractions including the Hollywood sci-fi movie "Jurassic World Rebirth," Japanese animated film "Detective Conan: One-Eyed Flashback," and Chinese crime drama "She's Got No Name," according to film data tracker Maoyan.
Corporate
JD discussing China's biggest retail foray to date into Europe
E-commerce giant JD.com is in advanced talks to acquire German electronics retailer Ceconomy for a possible 2.2 billion euros (US$2.6 billion). A deal of that size would be the largest Chinese retail investment in Europe to date. Ceconomy has confirmed that discussions are underway and that JD is considering a 4.60 euro per share cash offer, though no binding agreement has been signed. The company owns retail chains MediaMarkt and Saturn, with about 1,000 outlets across Europe. Nearly a quarter of its annual revenue comes from online sales. The move by JD follows its HK$4 billion (US$509 million) purchase of Hong Kong's Kai Bo Food Supermarket earlier this month and comments from founder Richard Liu that offshore expansion is a key focus of the company. JD already employs over 2,000 staff in Europe.
Renewable energy firms flag losses, solar and wind installations drop in June
Chinese renewable energy companies LONGi Green Energy Technology and Tongwei flagged net losses for the first half. Their warnings came as new installations of solar and wind power in China fell last month after the government adopted rules that could crimp sales, Bloomberg reported
The country added 14 gigawatts of solar last month, down 85 percent from May, according to data from the National Energy Administration. Wind installations dropped to 5 gigawatts in June from 26 gigawatts a month ago, though thermal power installation rose slightly to 8 gigawatts.
Among the new rules, one makes it more difficult to connect rooftop panels to the state energy grid, while another removes pricing protections that tended to guaranteed profits for wind and solar projects.
Ailing Chinese household décor firms pivot to used car sales
Some Chinese retailers of furniture and household décor goods, stung by slow sales in the property market, are turning showroom space into used car markets. KMX Group's home furniture plaza in the city of Zhengzhou has dedicated a 10th of its floor space to used cars. Huafeng Group, a Henan-based home lighting company, announced plans to expand into vehicle sales, and the Red Star Macalline Group has partnered with a used car company to create vehicle marts in its furniture malls. The industry has been hit by lower revenue. Easyhome New Retail Group, for one, reported a fourth consecutive annual decline in profits, and southern China's interior décor chain LJJ Home, filed for bankruptcy proceedings.