Afp Business Asia

European stock markets slid further Tuesday, while precious metals hit fresh peaks on fears of a US-EU trade war fuelled by Donald Trump’s tariff threat over opposition to his grab for Greenland.Asia’s main equity indices closed mixed, while US equity futures were sharply down, indicating sizeable losses on Wall Street when it reopens after Monday’s close because of the Martin Luther King holiday.Gold, seen as a safe-haven investment, notched yet another record high, at $4,726.70 an ounce.Silver also peaked, touching $95.51 an ounce.The dollar retreated and key bond yields in the United States and elsewhere climbed.”The US dollar is not serving as a safe haven because it seems to be entirely US-driven and raises fears about US policy and European exposure to US assets,” noted Neil Wilson, investor strategist at Saxo UK.When Wall Street reopens, the “Nasdaq looks set to chalk up the biggest declines amid concern about possible retaliatory action from Europe against America’s big tech contingent”, predicted AJ Bell investment director Russ Mould. Frankfurt led losses in Europe, shedding 1.5 percent in midday deals. There were sizeable falls also in London and Paris.After a bright start to the year fuelled by fresh hopes for the artificial intelligence sector, investors have taken fright since the US president ramped up his demands for the Danish autonomous territory, citing national security.With Copenhagen and other European capitals pushing back, Trump on Saturday said he would impose 10 percent levies on eight countries — including Denmark, France, Germany and Britain — from February 1, lifting them to 25 percent on June 1.- ‘Mistake’ -The move has raised questions about the outlook for last year’s US-EU trade deal.EU chief Ursula von der Leyen on Tuesday warned the United States that hitting allied European nations with punitive tariffs over Greenland would be a “mistake”. “The proposed additional tariffs are a mistake especially between long-standing allies,” von der Leyen told the Davos gathering in Switzerland. “The European Union and the United States have agreed to a trade deal last July. And in politics as in business — a deal is a deal. And when friends shake hands, it must mean something,” she added.US Treasury chief Scott Bessent on Monday said that any retaliatory EU tariffs would be “unwise”.Trump meanwhile ramped up his rhetoric against France on Tuesday, warning he would impose 200 percent tariffs on French wine and champagne over its intentions to decline his invitation to join his “Board of Peace” set up to oversee the rebuilding of Gaza.- Key figures at around 1100 GMT -London – FTSE 100: DOWN 1.2 percent at 10,075.62 points Frankfurt – DAX: DOWN 1.5 percent at 24,578.77Paris – CAC 40: DOWN 1.3 percent at 8,009.37Tokyo – Nikkei 225: DOWN 1.1 percent at 52,991.10 (close)Hong Kong – Hang Seng Index: DOWN 0.3 percent at 26,487.51 (close)Shanghai – Composite: FLAT at 4,113.65 (close)New York – Dow: Closed Monday for holidayEuro/dollar: UP at $1.1732 from $1.1641 on MondayPound/dollar: UP at $1.3478 from $1.3428Dollar/yen: DOWN at 157.85 yen from 158.09 yenEuro/pound: DOWN at 86.04 pence from 86.71 penceBrent North Sea Crude: UP 0.4 percent at $64.18 per barrelWest Texas Intermediate: UP 0.4 percent at $59.56 per barrelburs-bcp/ajb/jh

Asian markets extended losses Tuesday, while precious metals hit fresh peaks on fears of a US-EU trade war fuelled by Donald Trump’s tariff threat over opposition to his grab for Greenland.After a bright start to the year fuelled by fresh hopes for the artificial intelligence sector, investors have taken fright since the US president ramped up his demands for the Danish autonomous territory, citing national security.With Copenhagen and other European capitals pushing back, Trump on Saturday said he would impose 10 percent levies on eight countries — including Denmark, France, Germany and Britain — from February 1, lifting them to 25 percent on June 1.The move has raised questions about the outlook for last year’s US-EU trade deal, while French President Emmanuel Macron has called for the deployment of a powerful, unused instrument aimed at deterring economic coercion.In response, US Treasury chief Scott Bessent said Monday that any retaliatory EU tariffs would be “unwise”.Trump ramped up his rhetoric against France on Tuesday, warning he would impose 200 percent tariffs on French wine and champagne over its intentions to decline his invitation to join his “Board of Peace” set up to oversee the rebuilding of Gaza.The prospect of another trade standoff between two of the world’s biggest economic powers has fuelled a rush to safety and dealt a blow to risk assets.Asia equities extended Monday’s losses.Tokyo, Hong Kong, Sydney, Seoul, Singapore, Mumbai, Manila and Wellington were all down, while Shanghai was flat. Taipei, Bangkok and Jakarta edged up.London, Paris and Frankfurt were also sharply lower for a second successive day.Gold hit a fresh record of $4,722.76 and silver also peaked, touching $94.73.Meanwhile, Treasury yields rose amid a move out of US assets fuelled by the uncertainty sparked by Trump’s latest volley.Japanese government bonds yields also rose — with that on the 40-year note hitting the highest since it was launched in 2007 — after Prime Minister Sanae Takaichi called snap elections Monday and pledged to cut a tax on food for a two-year period.The announcement fuelled fresh worries the government will borrow more cash at a time when questions are already being asked about the country’s finances.Her cabinet approved a record 122.3-trillion-yen ($768 billion) budget for the fiscal year from April 2026, and she has vowed to get parliamentary approval as soon as possible to address rising prices and shore up the world’s fourth-largest economy.Eyes are now on Davos, Switzerland, where the US president is expected to give a speech to the World Economic Forum.”Davos now becomes the theatre that matters. Not for soundbites, but for whether the adults step back into the room,” wrote Stephen Innes of SPI Asset Management.”If this turns sour, volatility will not stay bottled. What would normally be a Ukraine-focused week risks being hijacked by a far more destabilising question, namely, whether the transatlantic alliance is being stress-tested in public. “A NATO fracture, even a rhetorical one, is not something markets are trained to shrug off.”- Key figures at around 0815 GMT -Tokyo – Nikkei 225: DOWN 1.1 percent at 52,991.10 (close)Hong Kong – Hang Seng Index: DOWN 0.3 percent at 26,487.51 (close)Shanghai – Composite: FLAT at 4,113.65 (close)London – FTSE 100: DOWN 0.8 percent at 10,116.01 Euro/dollar: UP at $1.1691 from $1.1641 on MondayPound/dollar: UP at $1.3477 from $1.3428Dollar/yen: UP at 158.39 yen from 158.09 yenEuro/pound: UP at 86.75 pence from 86.71 penceWest Texas Intermediate: UP 0.2 percent at $59.58 per barrelBrent North Sea Crude: DOWN 0.3 percent at $63.76 per barrelNew York – Dow: Closed for a holiday

A record number of tourists flocked to Japan in 2025, officials said Tuesday, despite a steep fall in Chinese visitors in December as a diplomatic row between Beijing and Tokyo rumbled on.Japan logged 42.7 million arrivals last year, according to the transport ministry, topping 2024’s record of nearly 37 million as the weak yen boosted the appeal of the “bucket list” destination.However, the number of tourists from China last month dropped about 45 percent from a year earlier to around 330,000.Prime Minister Sanae Takaichi’s suggestion in November that Tokyo could intervene militarily in any attack on Taiwan triggered a sharp diplomatic backlash from China, which urged its citizens to avoid travelling to Japan.Tuesday’s announcement showed the warning had impacted visitor numbers.China has been the biggest source of tourists to the Japanese archipelago, with almost 7.5 million visitors in the first nine months of 2025 — a quarter of all foreign tourists, according to official figures.Attracted by a weak yen, Chinese tourists splashed out the equivalent of $3.7 billion in the third quarter.In the wake of Beijing’s travel warning, Li Benjing, an employee at a small travel agency in Tokyo targeting Chinese tourists, told AFP the firm had seen a 90 percent decline in sales.”The impact for our business is huge,” she said. However, Transport Minister Yasushi Kaneko said it was a “significant achievement” that overall visitor numbers had topped 40 million people for the first time. “While the number of Chinese tourists in December decreased, we attracted a sufficient number of people from many other countries and regions to offset that,” he said, adding that there had been a “steep” increase in tourists from Europe, the United States and Australia.”We also hope and want to make sure that Chinese visitors will return to us as soon as possible,” he added.  The overall increase is partly due to government policies to promote attractions from Mount Fuji’s majestic slopes to shrines and sushi bars in more far-flung parts of the archipelago.The government has set an ambitious target of reaching 60 million tourists annually by 2030.- Overtourism -Japan’s biggest travel agency JTB forecasted that overall tourist numbers this year would be “slightly lower” compared to 2025 due to a decrease in demand from China and Hong Kong.Nevertheless, tourism income was expected to increase due to rising prices of items such as lodging and strong spending among visitors. It added that due to an uptick in repeat visitors to Japan, the places people want to visit are shifting from large cities to rural areas.Authorities say they want to spread sightseers more evenly around the country, as complaints of overcrowding in hotspots like Kyoto grow. As in other global tourist magnets like Venice in Italy, there has been a growing pushback from residents in the ancient capital.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.Locals have complained of disrespectful tourists harassing the geisha in a frenzy for photos, as well as causing traffic congestion and littering.Elsewhere, exasperated officials have taken steps to improve visitors, including introducing an entry fee and a daily cap on the number of hikers climbing Mount Fuji.A barrier was briefly erected outside a convenience store in 2024 to stop people from standing in the road to photograph a view of the snow-capped volcano that had gone viral.

Before DeepSeek shook up the tech world and put Chinese artificial intelligence on the map, Wu Chenglin’s own startup had nearly folded three times — but in the past year it has raised $30 million.The January 2025 release of a low-cost generative AI model from DeepSeek that performed at a similar level to ChatGPT and other top American chatbots upended assumptions of US dominance in the sensitive sector.The breakthrough has galvanised China’s AI scene, despite hurdles posed by rivalry with the United States, and fears of a global market bubble.”It gave a lot of people confidence” that China’s AI community previously lacked, Wu told AFP.His venture DeepWisdom, whose flagship product is a platform for AI-powered software development, had struggled to stay afloat despite its popularity among programmers.But as excitement around DeepSeek fuelled a boom in spending, Wu raised 220 million yuan in two funding rounds.Meanwhile, Shi Yaqiong and her team at Beijing-based Jinqiu Capital have closed deals with more than 50 AI firms over the past 12 months.Shi, the fund’s vice-president, described a “clear surge” in enthusiasm around Chinese AI and competition among investors since the DeepSeek shock.”The kind of projects with an initial valuation in 2024 of $10-20 million were, in 2025, expected to have initial valuations around $20-40 million,” she said.- Engineer dividend -Shares in two leading Chinese AI startups, Zhipu AI and MiniMax, soared on their market debuts in Hong Kong this month.Frenzy over the much-hyped potential of AI to change the world is driving global stocks to record highs, led by chipmakers and tech giants.But the big-spending euphoria has sparked fears of a market crash, with many investors hyper-focused on any sign the AI bubble could burst, and questioning when new companies will become profitable.Access to top-end chips made by US giant Nvidia is also restricted in China under White House policies designed to curb China’s technological development.But that hasn’t dampened the spirits of young developers in the world’s second largest economy.At an AI networking event held on a brisk winter afternoon last week in a stylish Beijing cafe, animated discussion filled the air about the future of the fast-moving industry.Chip export controls mean Chinese AI is more likely to be “open-source and cheap” which could make it more useful to society, said one participant, entrepreneur Li Weijia.China is often said to enjoy an “engineer dividend” that benefits its AI sector, and talent is flocking to the field.Online hiring platform Zhilian Zhaopin reported a 39 percent increase in applications to AI-related jobs in the first three quarters of 2025, after DeepSeek’s breakout.- ‘Cost-efficient’ -“China has a huge application developer ecosystem and people are very good at building apps,” Shen Qiajin, founder of ideaFlow, told AFP.”But for a very long time, we didn’t have a good cost-efficient model,” he said.That is a gap DeepSeek has now filled.The firm began in 2023 as a side project of a data-driven hedge fund co-founded in the tech hub Hangzhou by Liang Wenfeng, which had access to a cache of powerful Nvidia processors.Today, the company — expected to release its next AI model within weeks — holds four percent of global market share for chatbots, according to web traffic analysis company Similarweb.ChatGPT dominates at 68 percent while Google’s Gemini is catching up at 18 percent, Similarweb estimates.DeepSeek’s decision to make its systems’ inner workings public, in contrast to the closed AI models sold by OpenAI and other Western rivals, has boosted adoption of its tools by developers and businesses, Neil Shah at Counterpoint Research said.Its tools have had “strong adoption in cost-sensitive emerging markets”, he said.But in the West users are more cautious, “primarily on account of privacy and national security concerns”.Even so, the domestic market is huge. By June 2025, more than half a billion Chinese internet users reported having used generative AI products, according to the China Internet Network Information Center.Entrepreneur Yang Yiwen said her parents had their first meaningful encounter with AI during last year’s Chinese New Year, when they watched her use DeepSeek to plan a family trip.”They found it quite fun,” she said.

Asian markets extended losses Tuesday and silver hit a fresh peak on fears of a US-EU trade war fuelled by Donald Trump’s tariff threat over opposition to his grab for Greenland.After a bright start to the year fuelled by fresh hopes for the artificial intelligence sector, investors have taken fright since the US president ramped up his demands for the Danish autonomous territory, citing national security.With Copenhagen and other European capitals pushing back, Trump on Saturday said he would impose 10 percent levies on eight countries — including Denmark, France, Germany and Britain — from February 1, lifting them to 25 percent on June 1.The move has raised questions about the outlook for last year’s US-EU trade deal, while French President Emmanuel Macron has called for the deployment of a powerful, unused instrument aimed at deterring economic coercion.In response, US Treasury chief Scott Bessent said Monday that any retaliatory EU tariffs would be “unwise”.The prospect of another trade standoff between two of the world’s biggest economic powers has fuelled a rush to safety and dealt a blow to risk assets.After hefty selling in Europe, Asia equities extended losses.Tokyo, Hong Kong, Shanghai, Sydney, Seoul, Singapore, Taipei, Manila and Wellington were all down.Silver hit another record high, touching $94.73 in Asian trade, while gold held just shy of its own peak hit Monday.Meanwhile, Treasury yields rose amid a move out of US assets fuelled by the uncertainty sparked by Trump’s latest volley.Japanese government bonds yields also rise, with that on the 40-year note hitting the highest since it was launched in 2007, after Prime Minister Sanae Takaichi called snap elections Monday and pledged to cut a tax on food for a two-year period.The announcement fuelled fresh worries the government will borrow more cash at a time when questions are already be asked about the country’s finances.Her cabinet approved a record 122.3-trillion-yen ($768 billion) budget for the fiscal year from April 2026, and she has vowed to get parliamentary approval as soon as possible to address rising prices and shore up the world’s fourth-largest economy.Eyes are now on Davos, Switzerland, where the US president is expected to give a speech to the World Economic Forum.”Davos now becomes the theatre that matters. Not for soundbites, but for whether the adults step back into the room,” wrote Stephen Innes of SPI Asset Management.”If this turns sour, volatility will not stay bottled. What would normally be a Ukraine-focused week risks being hijacked by a far more destabilising question, namely, whether the transatlantic alliance is being stress-tested in public. “A NATO fracture, even a rhetorical one, is not something markets are trained to shrug off.”- Key figures at around 0230 GMT -Tokyo – Nikkei 225: DOWN 1.2 percent at 52,931.11 (break)Hong Kong – Hang Seng Index: DOWN 0.6 percent at 26,401.75Shanghai – Composite: DOWN 0.7 percent at 4,087.43Euro/dollar: DOWN at $1.1639 from $1.1641 on MondayPound/dollar: DOWN at $1.3417 from $1.3428Dollar/yen: UP at 158.15 yen from 158.09 yenEuro/pound: UP at 86.76 pence from 86.71 penceWest Texas Intermediate: UP 0.4 percent at $59.69 per barrelBrent North Sea Crude: UP 0.1 percent at $64.01 per barrelNew York – Dow: Closed for a holidayLondon – FTSE 100: DOWN 0.4 percent at 10,195.35 (close)

International investors bought heavily into precious metals while switching out of stocks Monday in a flight to safety after US President Donald Trump threatened fresh tariffs over opposition to his Greenland plans.Gold and silver prices surged, with silver hitting a new record high, while stock markets slid after European countries said they “stand united” against Trump’s weekend vow to hit them with tariffs of up to 25 percent unless Greenland is ceded to the United States.”Gold surged to a record high and stocks wobbled as fresh worries about Greenland surfaced,” noted Neil Wilson, investor strategist at Saxo UK.Gold has broken record after record in recent months as the precious commodity, along with sister metal silver, benefits from safe-haven status.Gold traded around 1.6 percent higher at the end of the European trading day, while silver rose by more than four percent, having set a new record high.Market jitters got worse after the US Treasury chief said Monday that any retaliatory EU tariffs on the US would be “unwise”.Experts said investors were finding it difficult to absorb what Ipek Ozkardeskaya, senior analyst at Swissquote, called a constant stream of “abnormal” news surrounding the Trump’s campaign to take over Greenland.”I lose my words in the absurdity of the news flow,” she said.Wall Street was shut for Martin Luther King Day, but there was much selling in Europe’s equity markets as the mood turned risk-averse.The luxury and auto sectors were hit hard by Trump’s threats, with the share prices of LVMH dropping by close to five percent, and that of BMW by nearly four percent.But some defence stocks climbed, with Germany’s Rheinmetall up by more than one percent.The IMF on Monday upgraded its 2026 global growth forecast, citing a boost from tech investments but warning that a reevaluation of AI productivity gains or renewed trade tensions could bring disruptions.World economic growth is projected to hold steady at 3.3 percent this year, it said. This would match the pace of growth in 2025.China’s economy grew at one of the slowest rates in decades last year, official data revealed Monday, as authorities struggled to overcome low consumer spending and a debt crisis in the property sector.Chinese stocks closed mixed at the start of the new trading week.- Key figures at around 1640 GMT -London – FTSE 100: DOWN 0.4 percent at 10,195.35 points (close)Frankfurt – DAX: DOWN 1.3 percent at 24,959.06 (close)Paris – CAC 40: DOWN 1.8 percent at 8,112.02 (close)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)New York – ClosedEuro/dollar: UP at $1.1641 from $1.1604 on FridayPound/dollar: UP at $1.3428 from $1.3382Dollar/yen: UP at 158.09 yen from 158.07 yenEuro/pound: UP at 86.71 pence from 86.69 penceBrent North Sea Crude: UP 0.1 percent at $64.18 per barrelWest Texas Intermediate: UP 0.1 percent at $59.40 per barrelburs-jh/rmb

Gold and silver prices hit record highs and stock markets slid Monday as investors sought safety after US President Donald Trump threatened fresh tariffs over opposition to his Greenland ambitions.European countries including Denmark, of which Greenland is an autonomous territory, said they “stand united” against Trump’s vow on Saturday to hit them with tariffs of up to 25 percent unless Greenland is ceded to the United States.”Gold surged to a record high and stocks wobbled as fresh worries about Greenland surfaced,” noted Neil Wilson, investor strategist at Saxo UK.Gold has broken record after record in recent months as the precious commodity, along with sister metal silver, benefits from safe-haven status.The latest market unrest followed Trump’s threats against Iran last week and the recent US ouster of Venezuelan president Nicolas Maduro which triggered volatility in the oil market.Gold hit a peak of $4,690.59 an ounce on Monday, while silver struck an all-time high of $94.12 an ounce. The Frankfurt and Paris stock markets retreated around 1.5 percent in late morning deals, as London shed around 0.6 percent.The dollar fell against main rivals, including the yen. Wall Street was shut for Martin Luther King Day.Japanese Prime Minister Sanae Takaichi said she would dissolve parliament this week ahead of a snap election on February 8, hoping for a stronger mandate to push through her ambitious policy agenda.Reacting to Trump’s latest move over tariffs, UK Prime Minister Keir Starmer said a “trade war is in no one’s interest”.”The use of tariffs against allies is completely wrong,” Starmer told a hastily-arranged press conference Monday.In stocks trading, the luxury and auto sectors were hit hard by Trump’s threats, with the share prices of LVMH and BMW each down 4.0 percent.However, defence stocks climbed, with Germany’s Rheinmetall up 2.8 percent and Britain’s BAE Systems gaining 1.8 percent.The IMF on Monday upgraded its 2026 global growth forecast, citing a boost from tech investments but warning that a reevaluation of AI productivity gains or renewed trade tensions could bring disruptions.World economic growth is projected to hold steady at 3.3 percent this year, the International Monetary Fund said, raising its forecast by 0.2 percentage points from October. This would match the pace of growth in 2025.China’s economy grew at one of the slowest rates in decades last year, official data revealed Monday, as authorities struggled to overcome low consumer spending and a debt crisis in the property sector.Chinese stocks closed mixed at the start of the new trading week.- Key figures at around 1045 GMT -London – FTSE 100: DOWN 0.6 percent at 10,174.60 points Frankfurt – DAX: DOWN 1.4 percent at 24,942.07Paris – CAC 40: DOWN 1.6 percent at 8,130.12Tokyo – 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)New York – Dow: DOWN 0.2 percent at 49,359.33 (close)Shanghai – Composite: UP 0.3 percent at 4,114.00 (close)Euro/dollar: UP at $1.1624 from $1.1604 on FridayPound/dollar: UP at $1.3410 from $1.3382Dollar/yen: DOWN at 157.85 yen from 158.07 yenEuro/pound: UP at 86.72 pence from 86.69 penceBrent North Sea Crude: DOWN 0.6 percent at $63.76 per barrelWest Texas Intermediate: DOWN 0.5 percent at $59.02 per barrelburs-bcp/ajb/rl

China’s economy grew at one of the slowest rates in decades last year, according to official data released Monday, as authorities struggle to overcome low consumer spending and a debt crisis in the property sector.The five-percent expansion was in line with Beijing’s annual target — a low-ball figure analysts have likened to a political comfort blanket. But observers warned it was driven largely by exports and masked weak sentiment on the ground.In a sign of the work ahead for leaders, the data also showed a significant slowdown in the last quarter of the year as expected, growing at 4.5 percent.”The impact of changes in the external environment has deepened,” said National Bureau of Statistics (NBS) official Kang Yi.”The domestic contradiction of strong supply and weak demand is prominent, and there are still many old problems and new challenges in economic development,” he told a news briefing.While the reading was in line with the government’s target of “around five percent” — allowing officials to declare victory — Chinese consumers remain jittery about the wider economy and high unemployment.That is despite officials relaxing fiscal policy and subsidising the replacement of household items in a sputtering bid to boost spending.”Everyone is thinking harder about their spending under these poor economic conditions,” Yang Qing, a woman visiting a tourist area in Shanghai, told AFP.Policies and measures to boost consumption would continue into 2026, Kang noted, including the trade-in scheme for old household appliances.”The gradual implementation of policies to clear unreasonable restrictions in the consumption sector will support consumption growth,” he said.- Overstated strength -Figures on Monday also showed that growth in retail sales, a key indicator of consumption, slowed to 3.7 percent last year from four percent in 2024.For December, the reading came in at 0.9 percent on-year — the weakest pace since the end of 2022, when stringent zero-Covid measures ended.The decline in sales likely reflects the waning impact of consumer subsidies, Zichun Huang of Capital Economics wrote in a note.But overall figures likely “overstate the strength of the economy”, she said.Industrial output expanded 5.9 percent in 2025, a slight slowdown from the previous year, while the 5.2-percent increase seen in December was an improvement on November’s pace.”The December activity data suggest that output growth gained some momentum at the end of the year, but that’s largely driven by resilient exports,” Huang said.”We expect growth this year to be at least slightly softer than in 2025,” she added.Officials were keen to point to China’s factory activity, which ticked up slightly in December to provide an unexpected silver lining to an otherwise lacklustre year’s end.A key measure of industrial health, the manufacturing purchasing managers’ index, ticked up to 50.1 last month, according to NBS data, just above the 50-point mark separating contractions from expansions. The figure had not been positive since March.But China’s property sector, once a major indicator of the country’s economic strength, is mired in a debt crisis despite interest rate cuts and loosened restrictions on homebuying.Fixed-asset investments in China shrunk 3.8 percent in 2025, reflecting a rebalancing following decades of heavy spending on property and infrastructure.The broader housing market remains sluggish, with real estate investment down 17.2 percent last year.- Trillion-dollar surplus -Donald Trump’s return to the White House last January and the revival of a fierce trade war between the world’s two largest economies added to Beijing’s problems.Chinese President Xi Jinping and Trump reached a tentative truce when they met in late October, agreeing to pause painful measures that included lofty tit-for-tat tariffs.Official data showed Chinese exports to the United States plunged 20 percent in 2025, but that had little impact on demand for Chinese products elsewhere.Despite the bruising trade war, robust exports remained a bright spot in the cloudy economic picture.China’s trade surplus hit a record $1.2 trillion last year, with officials lauding a “new historical high” filled by other trade partners than the United States.Shipments to the Association of Southeast Asian Nations rose 13.4 percent year-on-year, while exports to African countries surged 25.8 percent.Exports to the European Union were also up 8.4 percent, though imports from the bloc dipped.Wang Dongdong, a Shanghai local working in international trade, said his business had done well enough last year that he felt confident splurging on a new car and a trip to Japan.”I think 2026 will be better than 2025, based on international trends,” he told AFP.pfc-dhw-mya-tjx/reb/ami

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.”