16/12/2025

BIZ & FINANCE TUESDAY | DEC 16, 2025

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Fed chief front-runner pledges independence

Beijing urges Gulf nations to seal free trade agreement BEIJING: China’s foreign minister has pressed the Gulf Cooperation Council to conclude long-running talks on a free trade agreement with China, attributing the urgency to rising protectionism and unilateralism as free trade comes “under attack”, according to a statement from the ministry yesterday. Chinese Foreign Minister Wang Yi is on a three-nation tour in the Middle East that began in the United Arab Emirates and is expected to end in Jordan. He met GCC secretary-general Jasem Mohamed Albudaiwi in Riyadh on Sunday, when he also met top Saudi officials separately. “The talks have lasted for more than 20 years, and conditions for all aspects are basically mature, it is time to make a final decision,” he said during a meeting with the GCC secretary-general, according to the Chinese Foreign Ministry. A successful FTA will send a “strong signal to the world about defending multilateralism”, Wang said, adding that China was supportive of the bloc strengthening its strategic autonomy and coordination, and advancing its integration process. China has interests in deepening cooperation in economy, trade, investment and other fields with the GCC as well, Wang said. China and Saudi Arabia agreed to closer communication and coordination on regional and international issues, with Beijing lauding Riyadh’s role in Middle East diplomacy and security, other statements following a meeting between the nations’ foreign ministers showed. Wang’s meeting with Saudi Arabia’s Foreign Minister Prince Faisal bin Farhan Al-Saud also took place on Sunday in the Saudi capital. A joint statement published by China’s official news agency Xinhua did not elaborate on the issues where the two countries would strengthen coordination, but mentioned China’s support for Saudi Arabia and Iran enhancing their relations as well as support from both sides for the “comprehensive and just settlement” of the Palestinian issue. “(China) appreciates Saudi Arabia’s leading role and efforts to achieve regional and international security and stability,” said the statement released today. Wang told his Saudi counterpart that China regarded Saudi Arabia as a “priority for Middle East diplomacy” and an important partner in global diplomacy, a Chinese Foreign Ministry statement said yesterday. He also encouraged more cooperation in energy and investments, as well as in the fields of new energy and green transformation. In a separate meeting with Saudi Crown Prince Mohammed bin Salman, Wang underscored China’s readiness to play a part as the “most reliable partner” in the Middle Eastern country’s revitalisation, as well as “inject more stabilising factors” to realise peace and security in the region, another foreign ministry statement showed. The countries have agreed to mutually exempt visas for diplomatic and special passport holders from both sides, according to the joint statement. – Reuters

o Hassett says Trump’s opinion matters but will not set central bank’s action NEW YORK: Kevin Hassett, US President Donald Trump’s economic adviser and his favorite to lead the Federal Reserve, said on Sunday that the central bank’s mission was to demonstrate independence – but the president’s opinion “matters”. As a top adviser to the president, “I talk about almost everything with him almost every day”, Hassett said during an appearance on CBS’s Face the Nation . “I’ve certainly talked about monetary policy,” he said, when asked whether he would frequently consult the president if picked to replace Jerome Powell, whose term as Fed chairman ends in May. “I think he (Trump) has very strong and well-founded views about what we ought to do. But in the end, the job of the Fed is to be independent,” Hassett said. And when asked whether the president’s voice would have “equal weighting” with voting members on the Fed’s Board of Governors, Hassett replied: “No, no... he would have no weight.” “It’s just his opinion matters if it’s good, you know, if it’s based on data,” he added. On Dec 2, Trump suggested that Hassett, 63, was his favorite to replace Powell. Hassett, a PhD economist, chairs the National Economic Council, a White House body that advises the president and his cabinet on policymaking. He often appears on television touting the president’s policies. During Trump’s first term, Hassett served as chair of the Council of Economic Advisers, another body more dedicated to research and analysis.

Hassett speaks in front of a TV camera at the White House. – REUTERSPIC

of Powell, the outgoing chair, by piling on insults and complaints against the man whom he elevated to Fed chair during his first term. Since then, Trump has said he bitterly regrets that choice, with the Fed keeping interest rates at a level he considers far too high. Trump declared on Wednesday that it could have “at least doubled” the cut to the key interest rate, which was decided that day. At the White House on Sunday, Trump took another swipe at Powell. “We’re fighting through him, and we’ll soon have a good head of the Fed who’s going to want to see interest rates go down,” the president said. “The interest rates are coming down despite him. He’s incompetent. “He’s an incompetent person who suffers from Trump derangement syndrome.” – AFP

On Wednesday, a divided Fed lowered interest rates for a third consecutive time this year, flagging labour market concerns even as inflation remained elevated while tariffs implemented by the second Trump administration bite. The cut by a quarter percentage point brought rates to a range between 3.50% and 3.75%, the lowest in around three years. “I hope Kevin Warsh would also speak to the president if he were Fed chair,” Hassett said during his Sunday appearance on CBS, referring to another likely candidate as he defended Trump’s economic policies. The presidential pick will have to be approved for the top Fed post by the Senate, which the Republican Party controls. Trump tried in vain to hasten the departure

Japan needs niche approach to get back in chip game: NTT chairman TOKYO: Japan needs to take a niche approach to chip manufacturing – rather than trying to compete on scale and price – as it aims to revive its once-mighty chip industry, the chairman of telecom heavyweight NTT told Reuters in an interview. Korea’s Samsung Electronics,” Sawada said in an interview last week. “We should aim for high mix, low volume,“ he said, referring to a strategy that some chipmakers use to produce a wide variety of highly specialised chips at lower volumes, allowing them to charge more for niche products.

NTT is one of a number of major Japanese corporations invested in Rapidus, the government-backed chipmaker that plans to start mass production of advanced semiconductors in 2027. Set up in 2022, Rapidus is central to the government’s US$65 billion plan to boost the chip and artificial intelligence industries that was unveiled last year. Japan’s top three banks plan to lend around ¥2 trillion (RM53 billion) to Rapidus, Reuters reported last week. In the 1980s, Japan was one of the world’s most dominant players in chips, a position it has since ceded to rivals in Taiwan and South Korea. Japan’s industry lost its competitive edge by chasing low-cost, high-volume production, something it needs to avoid this time around, NTT’s Jun Sawada said. “In terms of economies of scale, we can’t beat Taiwan’s TSMC or South

Japan’s plan to revive its chip industry is in tandem with Washington’s drive to ensure stability of the chip supply chain in response to China’s rapid advances in technology. NTT would like to see Rapidus adopt its IOWN technology, which uses light to transmit data, and is faster and consumes less power than standard technology, Sawada said. Sawada, who chaired the Japan-US Business Council until October, said President Donald Trump’s policies also had positives for Japan. While there has been much hand-wringing in Japan about US tariffs, Sawada pointed to Japan’s pledge this year to invest US$550 billion in the United States as an opportunity. “You can view it positively. While tariffs are high, Japan is able to get into the market and take market share,” he said. – Reuters

Sawada poses for a photograph during the interview in Tokyo. – REUTERSPIC