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South Korean ministries and police said Thursday they were blocking DeepSeek’s access to their computers, after the Chinese AI startup did not respond to a data watchdog request about how it manages user information.DeepSeek launched its R1 chatbot last month, claiming it matches the capacity of artificial intelligence pacesetters in the United States for a fraction of the investment, upending the global industry.South Korea, along with countries such as France and Italy, have asked questions about DeepSeek’s data practices, submitting a written request for information about how the company handles user information.But after DeepSeek failed to respond to an enquiry from South Korea’s data watchdog, a slew of ministries confirmed Thursday they were taking steps to limit access to prevent potential leaks of sensitive information through generative AI services.”Blocking measures for DeepSeek have been implemented specifically for military work-related PCs with Internet,” a defence ministry official told AFP.The ministry, which oversees active-duty soldiers deployed against the nuclear-armed North, has also “reiterated the security precautions regarding the use of generative AI for each unit and soldier, taking into account security and technical concerns”, it added.South Korea’s police told AFP they had also blocked access to DeepSeek, while the trade ministry said that access had been temporarily restricted on all its PCs. The trade, finance, unification and foreign ministries also all said they had blocked the app or had taken unspecified measures.- Bans ‘not excessive’ -Last week, Italy launched an investigation into DeepSeek’s R1 model and blocked it from processing Italian users’ data.Australia has also banned DeepSeek from all government devices on the advice of security agencies.Kim Jong-hwa, a professor at Cheju Halla University’s artificial intelligence department, told AFP that amid growing rivalry between the United States and China he suspected “political factors” could be influencing the reaction to DeepSeek — but said bans were still justified.”From a technical standpoint, AI models like ChatGPT also face numerous security-related issues that have not yet been fully addressed,” he said.”Given that China operates under a communist regime, I question whether they consider security issues as much as OpenAI does when developing innovative technologies,” he said. “We cannot currently assess how much attention has been paid to security concerns by DeepSeek when developing its chatbot. Therefore, I believe that taking proactive measures is not too excessive.”Beijing on Thursday hit back against the ban, insisting the Chinese government “will never require enterprises or individuals to illegally collect or store data”.”China has always opposed the generalisation of national security and the politicisation of economic, trade and technological issues,” foreign ministry spokesman Guo Jiakun said.Beijing would also “firmly safeguard the legitimate rights and interests of Chinese enterprises,” Guo vowed.- ‘Complex competition’ -DeepSeek says it uses less-advanced H800 chips — permitted for sale to China until 2023 under US export controls — to power its large learning model.South Korean chip giants Samsung Electronics and SK hynix are key suppliers of advanced chips used in AI servers.The government announced on Wednesday an additional 34 trillion won ($23.5 billion) investment in semiconductors and high-tech industries, with the country’s acting president urging Korean tech companies to stay flexible. “Recently, a Chinese company unveiled the AI model DeepSeek R1, which offers high performance at a low cost, making a fresh impact in the market,” acting President Choi Sang-mok said Wednesday.”The global AI competition may evolve from a simple infrastructure scale-up rivalry to a more complex competition that includes software capabilities and other factors.”

Wall Street stocks forged higher Wednesday, propelled by resurgent optimism about AI while oil prices tumbled on trade war uncertainty and bearish US petroleum inventory data.Shares of Google parent Alphabet took a hit, slumping around seven percent after the company announced plans to spend an eye-popping $75 billion in 2025 on AI development programs.But AI-linked companies such as Arm, Broadcom and Nvidia surged higher in anticipation of strong performances.”The market has kind of separated out the weakness seen in Alphabet as sort of just an Alphabet issue,” Briefing.com’s Patrick O’Hare told AFP.”You take that big CapEx number and that’s a little bit staggering, obviously,” he said.”If they’re going to spend $75 billion in 2025, that should be pretty good for, you know, a company like Nvidia,” he added, referring to the major chip designer whose shares closed 5.2 percent higher.The move “helped energize the AI trade a bit,” he added. Following a mixed day on European and Asian bourses, all three major US indices advanced. The S&P 500 finished 0.4 percent higher.Tensions between the United States and China have soared in recent days as the world’s two largest economies slapped a volley of import tariffs on each other.Analysts noted that China’s tariff response this week was relatively modest, providing some hope that a full-blown crisis could be avoided.But “the problem with trade wars is they can escalate quickly, leading to potential issues such as inflation, job losses and even recession”, said Kate Marshall, lead investment analyst at Hargreaves Lansdown. Hong Kong’s stock market closed down nearly one percent, with e-commerce giant JD.com sinking almost four percent and rival Alibaba also falling after US Postal Service officials suspended a duty-free exemption for low-value packages imports from China. In an apparent climbdown, the USPS on Wednesday morning said it would “continue accepting all international inbound mail and packages from China and Hong Kong Posts.”Beijing had responded with fury to the move, accusing the United States of “politicizing trade and economic issues and using them as tools.”Uncertainty about US-China relations also weighed on the oil market, with major crude contracts losing more than two percent.Crude prices were also dented by weekly US stockpile data that showed commmercial stocks rose 8.7 million barrels, more than four times the expected amount.In company news, shares in Japan’s Nissan fell around five percent following reports that the carmaker decided to withdraw from merger talks with rival Honda.Shares in Honda soared more than eight percent by the close.- Key figures around 2140 GMT -New York – Dow: UP 0.7 percent at 44,873.28 (close)New York – S&P 500: UP 0.4 percent at 6,061.48 (close)New York – Nasdaq Composite: UP 0.2 percent at 19,577.02London – FTSE 100: UP 0.6 percent at 8,623.29 (close) Paris – CAC 40: DOWN 0.2 percent at 7,891.68 (close)Frankfurt – DAX: UP 0.4 percent at 21,585.93 (close)Tokyo – Nikkei 225: UP 0.1 percent to 38,831.48 (close)Hong Kong – Hang Seng Index: DOWN 0.9 percent to 20,597.09 (close)Shanghai – Composite: DOWN 0.7 percent to 3,229.49 (close)Euro/dollar: UP at $1.0397 from $1.0379 on TuesdayPound/dollar: UP at $1.2502 from $1.2480Dollar/yen: DOWN at 152.63 yen from 154.34 yenEuro/pound: FLAT at 83.16 pence West Texas Intermediate: DOWN 2.3 percent at $71.03 per barrelBrent North Sea Crude: DOWN 2.1 percent at $74.61 per barrelburs-jmb/dw

Shares in Google parent Alphabet slumped on Wednesday as its earnings disappointed investors and it was ensnared in rising trade tensions.Meanwhile, Chinese e-commerce firms took a hit from news that the US Postal Service was suspending inbound parcels from China and Hong Kong, a move that followed tit-for-tat tariffs hikes by Washington and Beijing. The USPS later reversed its decision, but the European Commission said it would seek to impose new fees on e-commerce imports.Shares in Alphabet slumped more than eight percent at the open of trading, with lower-than-expected revenue growth in its cloud division raising questions about its ability to compete with rivals in the heated AI infrastructure market.Alphabet also announced plans to invest approximately $75 billion in capital expenditures in 2025, a figure that surprised analysts and highlighted the mounting costs of AI development.”Investors were also unhappy about its capital expenditures, something that China’s cut-price, AI assistant DeepSeek, has thrown into sharp relief,” said David Morrison, senior market analyst at Trade Nation.The tech sector has already been roiled by the unveiling of DeepSeek, stoking concerns that the eye-watering investments made in AI in recent years may not ever return profits.”All this comes after China has said it will launch an antitrust probe into Google as part of its retaliation against Trump’s fresh tariffs,” he added.Tensions between the United States and China have soared in recent days as the world’s two largest economies slapped a volley of import tariffs on each other.Analysts noted that China’s tariff response this week was relatively modest, providing some hope that a full-blown crisis could be avoided.”Everything seems to be in limbo on the tariff front, subject to change for better or worse,” said Briefing.com analyst Patrick O’Hare.”The market is trying to hold it together, offering some grace that there won’t be a worst-case tariff scenario that invites stagflation, yet it is fair to say that it is dismayed by the uncertainty all the tariff talk has generated,” he added.But “the problem with trade wars is they can escalate quickly, leading to potential issues such as inflation, job losses and even recession”, said Kate Marshall, lead investment analyst at Hargreaves Lansdown. Hong Kong’s stock market closed down nearly one percent, with e-commerce giant JD.com sinking almost four percent and rival Alibaba also falling.Shanghai dropped after it returned from a week-long break, while Tokyo reversed earlier losses. Amid uncertainty, gold hit a fresh peak of $2,877 an ounce as investors rushed into the haven metal.”The $2,900 level is now in sight for gold, as the metal’s impressive rally goes on,” said Chris Beauchamp, Chief Market Analyst at online trading platform IG. “Safe haven buying, central bank purchases and continuing softness in the dollar have made life much more amenable for the commodity, and if tariffs rear their head again we should see the metal make fresh gains,” he added.In other company news, shares in Japan’s Nissan fell around five percent following reports that the carmaker had decided to withdraw from merger talks with rival Honda.Shares in Honda soared more than eight percent by the close.- Key figures around 1630 GMT -New York – Dow: UP 0.1 percent at 44,607.62 pointsNew York – S&P 500: DOWN 0.1 percent at 6,030.92New York – Nasdaq Composite: DOWN 0.4 percent at 19,577.02London – FTSE 100: UP 0.6 percent at 8,623.29 (close) Paris – CAC 40: DOWN 0.2 percent at 7,891.68 (close)Frankfurt – DAX: UP 0.4 percent at 21,585.93 (close)Tokyo – Nikkei 225: UP 0.1 percent to 38,831.48 (close)Hong Kong – Hang Seng Index: DOWN 0.9 percent to 20,597.09 (close)Shanghai – Composite: DOWN 0.7 percent to 3,229.49 (close)Euro/dollar: UP at $1.0422 from $1.0383 on TuesdayPound/dollar: UP at $1.2519 from $1.2480Dollar/yen: DOWN at 152.20 yen from 154.32 yenEuro/pound: UP at 83.23 pence from 83.16 penceWest Texas Intermediate: DOWN 2.1 percent at $71.19 per barrelBrent North Sea Crude: DOWN 2.0 percent at $74.71 per barrelburs-rl/cw

The European Commission announced Wednesday it would seek to impose new fees on e-commerce imports, as part of efforts to tackle a surge of “harmful” products into the bloc — the bulk of them from China.The EU action came as the US Postal Service (USPS) briefly suspended inbound parcels from China and Hong Kong, a move affecting low-cost platforms Temu and Shein — but the commission said the two actions were “not coordinated”.Announcing the steps at a press conference in Brussels, EU tech chief Henna Virkkunen said the bloc had seen the number of imported e-commerce parcels double from 2023 to 2024, to reach 12 million a day.”Many of those products have been found to be unsafe, counterfeit or even dangerous,” she said.The commission called on EU lawmakers and member states to “consider” a handling fee on e-commerce parcels imported directly to consumers, to address the “costs of supervising compliance” with EU rules.The move “aims to address growing concerns about the impact of those products on the health and safety of European consumers,” Virkkunen said.”It also looks into the significant environmental and climate damage caused by those shipments, and also the unlevel playing field which rogue traders create for our SMEs and businesses.”Around 90 percent of the packages concerned come from China, according to the commission, many of them sold by booming online giants Shein and Temu.Both Chinese-founded platforms are suspected by Brussels of not doing enough to prevent the sale of products that do not meet European standards.- Duty exemptions -The commission also confirmed the launch of an investigation into Shein for not abiding by the bloc’s consumer protection rules.”Any business that wants to benefit from our market of almost 450 million consumers should play by the rules,” said the EU’s consumer protection chief, Michael McGrath.Brussels is coordinating the investigation with the Consumer Protection Cooperation Network, which brings together the competent authorities of the bloc’s 27 member states. If Shein is found guilty it risks being fined.Shein said it would “engage” its partners at EU and national government-level to “study these recommendations.””We welcome efforts that enhance trust and safety for European consumers when shopping online,” the company said.The commission had also opened an investigation in October against Temu, which sells a vast array of goods at low costs. McGrath said up to 96 percent of products tested and sold on the targeted platforms were “not fully compliant with our rules and our safety standards.””The consequences can be real and can be very, very serious,” he said — citing examples like a baby’s pacifier that could come apart and choke the child, or a light fitting that could cause an electric shock.He promised a number of EU actions together with national authorities including “mystery shopping, testing activities, sweeps and controls to detect and recall dangerous products from the market in a more efficient way.”As well as the move to impose parcel handling fees, the commission also called for rapid implementation of previous proposals taken to level the playing field online, including removing the duty exemption for parcels worth less than 150 euros.The USPS on Tuesday scrapped a duty-free exemption for low-value packages and suspended parcel imports from China over tariffs imposed by US President Donald Trump. But that was quickly reversed on Wednesday as the postal service said it would keep accepting packages after fears the move could spark major trade disruptions.  

Nissan shares plunged on Wednesday as reports said the struggling Japanese carmaker was walking away from merger talks with rival Honda.The Nikkei business daily and other local media earlier said Honda had proposed making Nissan its subsidiary, instead of the previous plan to integrate under a new holding company.”Strong opposition” within Nissan to this proposal was behind its decision to withdraw from the talks, the Nikkei said. Private broadcaster TBS published a similar report.Discussions on setting up a holding company were launched in December but faltered as the two companies disagreed on the integration ratio and other conditions, the newspaper added.Nissan said in a statement it had not announced anything officially, but the two companies “are in the stage of advancing various discussions, including the contents of the report”.”We plan to establish a direction and make an announcement around mid-February.” The company’s shares plunged 4.8 percent before the Tokyo Stock Exchange suspended their trading, saying the media reports on the merger’s cancellation needed to be verified.Honda, however, closed 8.2 percent higher, having soared nearly 12 percent at one point.Nissan and Honda agreed in December to start talks on joining forces to create the world’s third-largest automaker — seen as a bid to catch up with Tesla and Chinese electric vehicle firms.Honda’s CEO insisted at the time it was not a bailout for Nissan, which last year announced thousands of job cuts after reporting a 93 percent plunge in first-half net profit.Business has been tough for foreign brands in China, where electric vehicle manufacturers such as BYD are leading the way as demand grows for less polluting vehicles.China overtook Japan as the biggest vehicle exporter last year, helped by government support for EVs.Honda and Nissan are Japan’s number two and three automakers after Toyota.They already agreed last year to explore a partnership on EV software and components among other technologies, an initiative joined by Mitsubishi Motors in August.But the smaller automaker’s chief said this week it would make a final decision on whether to join the Honda-Nissan merger talks in mid-February or later.In December, reports said Taiwanese electronics behemoth Foxconn had unsuccessfully approached Nissan to acquire a majority share.It then reportedly asked Renault to sell its 35 percent stake in Nissan — a pursuit that was put on hold before the merger talks were announced.A Renault spokesman told AFP that “the information relayed by the press does not indicate that a decision has been made”.”But they suggest that the planned operation is a takeover of Nissan by Honda. And this does not include a control premium (financial incentive) for Nissan shareholders,” the spokesman said, adding that Renault “will continue to defend the interests of the group and its shareholders”.Nissan has weathered a turbulent decade, including the 2018 arrest of former boss Carlos Ghosn, who later jumped bail and fled Japan concealed in a music equipment box.The company is also saddled with billions of dollars of debt that will reportedly mature over the next two years.nf-kaf-jug-hrc/lth/rl

Stock markets mostly fell, the dollar slid and gold hit a record high Wednesday over fears about a trade war between superpowers China and the United States.US tech sector shares also took a beating after earnings from Google-parent Alphabet missed expectations, with Wall Street’s tech-heavy Nasdaq Composite index shedding 0.6 percent.Chinese e-commerce firms took a hit from news that the US Postal Service was suspending inbound parcels from China and Hong Kong, a move that followed tit-for-tat tariffs. The USPS later reversed its decision, but the European Commission said it would seek to impose new fees on e-commerce imports.European markets wobbled, with carmakers and luxury industries suffering losses.Tensions between the United States and China have soared in recent days as the world’s two largest economies slapped a volley of import tariffs on each other.Analysts noted that China’s tariff response this week was relatively modest, providing some hope that a full-blown crisis could be avoided.”Everything seems to be in limbo on the tariff front, subject to change for better or worse,” said Briefing.com analyst Patrick O’Hare.”The market is trying to hold it together, offering some grace that there won’t be a worst-case tariff scenario that invites stagflation, yet it is fair to say that it is dismayed by the uncertainty all the tariff talk has generated,” he added.But “the problem with trade wars is they can escalate quickly, leading to potential issues such as inflation, job losses and even recession”, said Kate Marshall, lead investment analyst at Hargreaves Lansdown. Hong Kong’s stock market closed down nearly one percent, with e-commerce giant JD.com sinking almost four percent and rival Alibaba also falling.Shanghai dropped after it returned from a week-long break, while Tokyo reversed earlier losses. Amid uncertainty, gold hit a fresh peak of $2,877 an ounce as investors rushed into the haven metal.The tepid performance came despite a positive lead from Wall Street, after the United States delayed its 25 percent duties on imports from Canada and Mexico.Tech firms were also under pressure after disappointing earnings led shares in Google-parent Alphabet to slump more than eight percent.David Morrison, senior market analyst at Trade Nation, noted that Alphabet missed both the forecasts for overall revenue as well as that for its cloud operations.”Investors were also unhappy about its capital expenditures, something that China’s cut-price, AI assistant DeepSeek, has thrown into sharp relief,” he said.”All this comes after China has said it will launch an antitrust probe into Google as part of its retaliation against Trump’s fresh tariffs,” he added.Chip-maker Advanced Micro Devices sank 10 percent, having missed forecasts for sales to data centres.The tech sector has already been roiled by the unveiling of a new chatbot by Chinese startup DeepSeek, stoking concerns about the eye-watering investments made in AI in recent years.In other company news, shares in Japan’s Nissan fell around five percent following reports that the carmaker had decided to withdraw from merger talks with rival Honda.Shares in Honda soared more than eight percent by the close.British drugmaker GSK jumped almost seven percent — topping London’s top-tier FTSE 100 index — after it upgraded its sales outlook on strong cancer medicine sales, despite its net profit nearly halving. Spanish banking giant Santander surged more than seven percent after it reported record annual profits for a third consecutive year. – Key figures around 1430 GMT -New York – Dow: FLAT at 44,563.28 pointsNew York – S&P 500: DOWN 0.2 percent at 6,025.32New York – Nasdaq Composite: DOWN 0.6 percent at 19,529.18London – FTSE 100: UP 0.4 at 8,606.67  Paris – CAC 40: DOWN 0.2 percent at 7,892.10Frankfurt – DAX: UP 0.2 percent at 21,539.65Tokyo – Nikkei 225: UP 0.1 percent to 38,831.48 (close)Hong Kong – Hang Seng Index: DOWN 0.9 percent to 20,597.09 (close)Shanghai – Composite: DOWN 0.7 percent to 3,229.49 (close)Euro/dollar: UP at $1.0422 from $1.0383 on TuesdayPound/dollar: UP at $1.2517 from $1.2480Dollar/yen: DOWN at 153.01 yen from 154.32 yenEuro/pound: UP at 83.26 pence from 83.16 penceWest Texas Intermediate: DOWN 1.4 percent at $71.71 per barrelBrent North Sea Crude: DOWN 1.3 percent at $75.19 per barrelburs-rl/cw

Beijing accused the United States Wednesday of “suppression” after its postal service said it was suspending parcels from China and Hong Kong, a move that could hit e-commerce giants Temu and Shein.Tensions between the US and China have soared in recent days as the world’s two largest economies slapped a volley of tariffs on each others’ imports, hitting hundreds of billions of dollars in trade.On Tuesday, the US Postal Service (USPS) also scrapped a duty-free exemption for low-value packages.The “de minimis” exemption allows goods valued at $800 or below to enter the United States without paying duties or certain taxes, but it has faced scrutiny due to a surge in shipments in recent years.In a statement last month, the US Customs and Border Protection agency said exemption shipments were worth over $1.36 billion in 2024, creating challenges for its enforcement of trade laws, health and safety requirements, intellectual property rights, and consumer protection rules.US officials have pointed to the growth of Chinese-founded online retailers Shein and Temu as a key factor behind this increase — and Tuesday’s halt could delay parcels from both companies from entering the country.Beijing responded with fury to the move, accusing the US of “politicising trade and economic issues and using them as tools”.Vowing to “take necessary measures to resolutely safeguard the legitimate rights and interests of Chinese companies”, foreign ministry spokesman Lin Jian accused Washington of “unreasonable suppression”.Washington has been looking to tighten the “de minimis” rules, saying the growth in shipments makes it harder to screen goods for security risks.But the US postal service gave no reason for its pause on Tuesday.AFP has reached out to Shein and Temu for comment.Other retailers such as Amazon might also be impacted.Although earlier it appeared that US parcels could still be sent from Macau, by Wednesday evening the semi-autonomous Chinese city’s post office announced that its service was also suspended.- Tariff standoff -Tuesday saw Beijing say it would impose levies on imports of US energy, vehicles and equipment in a return salvo minutes after Trump’s threatened tariffs on Chinese goods came into effect.A day earlier, Trump suspended duties on Mexico and Canada for a month after both countries vowed to step up measures to counter flows of the drug fentanyl and the crossing of undocumented migrants into the United States.Beijing’s moves hit roughly $20 billion worth of US goods per year — roughly 12 percent of total American imports into China, according to calculations by Capital Economics.But their impact is a far cry from US tariffs announced over the weekend, which will affect some $450 billion worth of goods.Trump had signalled earlier that the talks with Xi could take place early this week, but addressing reporters at the White House Tuesday afternoon, he said he was in “no rush”.

Equity markets stumbled Wednesday and gold hit a new record as investors kept tabs on China and the United States after they exchanged tariffs, sparking fears of another debilitating trade war between the economic superpowers.Shanghai, which reopened after a week-long break, and Hong Kong were among the main losers as e-commerce firms took a hit from news that the US Postal Service was suspending inbound parcels from China and Hong Kong.The tepid performance came despite a positive lead from Wall Street, where there was a sigh of relief that US President Donald Trump had reached a deal to delay 25 percent duties on imports from Canada and Mexico.Disappointing earnings from Google-parent Alphabet and Advanced Micro Devices added to the unease over the tech sector, which has already been roiled by the unveiling of a new chatbot by Chinese startup DeepSeek.All eyes were on Washington and Beijing after they renewed their trade spat, though analysts said China’s apparently more measured approach provided some hope that a full-blown crisis could be avoided.China on Wednesday expressed its “resolute opposition” to US tariffs on its exports and called for “dialogue” to resolve trade differences.Kai Wang, Asia equity market strategist at Morningstar, said: “Regarding China’s counter measures, we think that the tariffs are less than what we had expected in our view. The move is largely symbolic given that only about 12% of total imports from the US would be subject to tariffs.””A key takeaway from this development, at least for now, is that fundamentally there is less risk implied than expected before,” he added.”However, escalation of the trade war remains a risk given Trump’s history of unpredictable behaviour. Therefore, the volatility risk remains on the table for the next four years at least,” he said.Economists at HSBC Global Research added that China’s “moves so far are more measured compared with the universal 10 percent tariff imposed by the US, suggesting a likely different playbook than a tit-for-tat strategy, though we acknowledge the risk of escalation has increased”.Hong Kong fell about one percent, with e-commerce giant JD.com sinking nearly four percent and rival Alibaba also lower on news of the US Postal Service suspension.Trump’s tariff announcement against China included the removal of an allowance — used by China’s e-commerce firms — that exempted small packages worth less than $800 from duties. The suspension does not involve letters and flat mail.Shanghai dropped as it reopened after a week-long break, while Singapore, Wellington, Mumbai, Bangkok and Jakarta also retreated, though Sydney, Seoul, Taipei and Manila rose.Tokyo reversed earlier losses, though Nissan dived 4.9 percent after Japan’s Nikkei business daily and other media said the carmaker had decided to withdraw from merger talks with rival Honda. The losses came before trading in the firm was suspended by the Tokyo Stock Exchange, which said the reports needed to be verified.Shares in Honda ended up 8.2 percent, having soared nearly 12 percent at one point.London, Paris and Frankfurt all fell at the open.Gold hit a fresh peak above $2,866 as investors rushed into the safe-haven metal.Tech firms were also under pressure after Alphabet sank 7.5 percent in after-hours trade in New York owing to disappointment at its lower-than-expected revenue growth and its ambitious 2025 capital spending forecast.Advanced Micro Devices also sank in post-close business.The tech sector has been feeling some pain since DeepSeek’s arrival on the scene with its chatbot, which apparently was developed at a fraction of the cost of similar tools made by US firms, stoking concerns about the eye-watering investments made in AI in recent years.On currency markets, the yen strengthened against the dollar following data showing nominal wages in Japan rose far more than expected last month and at the fastest pace since 1997. That firmed expectations the country’s central bank would continue to hike interest rates this year.- Key figures around 0815 GMT -Tokyo – Nikkei 225: UP 0.1 percent to 38,831.48 (close)Hong Kong – Hang Seng Index: DOWN 0.9 percent to 20,597.09 (close)Shanghai – Composite: DOWN 0.7 percent to 3,229.49 (close)London – FTSE 100: DOWN 0.1 percent at 8,563.28Euro/dollar: UP at $1.0399 from $1.0383 on TuesdayPound/dollar: UP at $1.2498 from $1.2480Dollar/yen: DOWN at 153.28 yen from 154.32 yenEuro/pound: UP at 83.24 pence from 83.16 penceWest Texas Intermediate: DOWN 0.4 percent at $72.44 per barrelBrent North Sea Crude: DOWN 0.5 percent at $75.84 per barrelNew York – Dow: UP 0.3 percent at 44,556.04 (close)

Japan’s Toyota said Wednesday it will build an electric vehicle plant in Shanghai for its luxury Lexus brand as it raised its annual net profit forecast to almost $30 billion.China overtook Japan as the biggest vehicle exporter last year, helped by its dominance in EVs.Many foreign car firms are struggling in China, but Toyota — the world’s top-selling automaker — said it wants to “match the unique needs of Chinese customers” with its new factory.”We decided to establish a wholly owned company for the development and production of Lexus BEVs (battery electric vehicles) and batteries in Shanghai, China,” it said.Toyota aims to start production there after 2027, and said the new plant would create 1,000 new jobs with an annual output capacity of approximately 100,000 vehicles.It will be China’s second wholly foreign owned electric vehicle factory after Tesla’s Shanghai plant. Other foreign companies making cars in the country run joint ventures with Chinese companies.”Local Chinese members will take the lead in planning and developing BEVs” to suit local customers, Toyota said.”Our goal is to become a company that is more loved and supported by the people of China.”- Forecasts up -Toyota said Wednesday it expects to log a net profit this financial year of 4.52 trillion yen ($29.5 billion), up from its previous forecast of 3.57 trillion yen.The “upward revision incorporates progress in strengthening earning power, backed by improvement efforts including product competitiveness”, the company said.Unit sales rose for hybrid electric vehicles between April and December, Toyota said.But over the same period, in China, total vehicle sales dropped from 1.5 million to 1.4 million.Lacklustre consumer spending and tough competition is making life hard for many automakers worldwide.However, Toyota’s strategy to offer a range of vehicles, including hybrids, has paid off in markets such as the United States.Tatsuo Yoshida, senior auto analyst at Bloomberg Intelligence, told AFP that Toyota was once “extremely cautious about expanding its business in China due to concerns over risks such as technology leaks”.”However, the company has now shifted its approach to developing technologies and products tailored to the local market, ensuring acceptance by Chinese consumers,” he said.- ‘Strategic move’ -China’s government has supported the development and production of less polluting battery-powered vehicles, a field where Chinese manufacturers such as BYD are leading the way.So Toyota’s decision to build the Shanghai plant “is a logical strategic move”, Yoshida said.”Toyota’s ability to make proactive investments in electrification (particularly BEVs) and its business in China, even when other auto companies hesitate, is a unique strength stemming from its abundant talent and financial resources.”Toyota also said on Wednesday that its new battery plant in the US state of North Carolina was ready to begin production.The nearly $14-billion plant will start shipping batteries for North American electrified vehicles in April, the company said.Honda and Nissan, Japan’s number two and three automakers after Toyota, have also launched talks on a merger to help them strengthen their position on EVs and self-driving tech.But Nissan shares plunged on Wednesday after the Nikkei business daily reported that the carmaker had decided to withdraw from merger talks, after Honda had proposed making Nissan its subsidiary.

Nissan shares plunged on Wednesday after Japan’s Nikkei business daily said the carmaker had decided to withdraw from merger talks with rival Honda.The newspaper and other Japanese media had earlier reported that Honda had proposed making Nissan a subsidiary, instead of the previous plan to integrate under a new holding company.”Strong opposition” within Nissan to this proposal had led it to walk away, the Nikkei said, adding that discussions on a holding company had faltered as the pair disagreed on the integration ratio and other conditions.In late afternoon trade in Tokyo, Nissan shares were down 4.8 percent. Honda shares, however, soared 12 percent.Tokyo Stock Exchange then suspended trading of Nissan shares, saying that confirmation of the authenticity of media reports related to the cancellation of the merger was necessary.Nissan and Honda agreed in December to launch discussions on joining forces to create the world’s third largest automaker, seen as a bid to catch up with Tesla and Chinese electric vehicle firms.Honda’s CEO insisted at the time it was not a bailout for Nissan, which last year announced thousands of job cuts after reporting a 93 percent plunge in first-half net profit.Lacklustre consumer spending and stiff competition in several markets are making life hard for many automakers.Business has been especially tough for foreign brands in China where electric vehicle manufacturers such as BYD are leading the way as demand grows for less polluting vehicles.China overtook Japan as the biggest vehicle exporter last year, helped by government support for EVs.Honda and Nissan are Japan’s number two and three automakers after Toyota.They already agreed last year to explore a partnership on EV software and components among other technologies, an initiative joined by Mitsubishi Motors in August.But the smaller automaker’s chief said this week it would make a final decision on whether to join the Honda-Nissan merger talks in mid-February or later.In December, reports said Taiwanese electronics behemoth Foxconn had unsuccessfully approached Nissan to acquire a majority share.It then reportedly asked Renault to sell its 35 percent stake in Nissan — a pursuit that was put on hold before the merger talks were announced.Nissan has weathered a turbulent decade, including the 2018 arrest of former boss Carlos Ghosn, who later jumped bail and fled Japan concealed in a music equipment box.The company is also saddled with billions of dollars of debt that will reportedly mature over the next two years.