06/02/2026

FRIDAY | FEB 6, 2026

17

BIZ & FINANCE

Indonesia posts fastest economic growth in 3 years

Sony hikes full-year forecasts even as PlayStation falters TOKYO: Japanese giant Sony hiked its full-year forecasts yesterday, as a weaker yen compensates for its ageing PlayStation games console and a memory chip crunch. Sony now expects net profit of ¥1.13 trillion (RM28 billion) in the 2025-26 fiscal year, up from its previous projection of ¥1.05 trillion, and a 6% rise on last year. It also projected a 20.6% rise in operating profit and revenues of ¥12.3 trillion, up 2.2%, as well as an improved operating margin of 12.5%, a statement said. For its third quarter, Sony’s net profit rose 11% and revenues were up 1%. Operating income of ¥515 billion beat analysts’ expectations. Sony’s PlayStation 5 (PS5), launched in 2020, is beginning to get old, and sales volumes of the games console fell 16% in the last quarter. The company offered steep discounts on the device last year in an attempt to boost demand. However, the Japanese group, like its competitors worldwide, is suffering from a growing shortage of memory chips. That is driving up the prices of the chips and eroding profit margins of all sorts of electronic goods. The artificial intelligence boom has pushed up prices and shipments of conventional NAND and DRAM memory chips, while demand for high-bandwidth memory (HBM) chips used in AI servers has soared. “It will definitely get more difficult to offer reduced prices (of the PS5) this year than in 2025,” gaming industry consultant Serkan Toto told AFP. Sony made no comment on the chip issue in its earnings release, which analysts say could also hit its hardware products such as cameras, TVs and smartphones, as well as its image sensor segment. Last month, Sony said it was spinning off its home entertainment business – which includes TVs – into a joint venture with Chinese giant TCL. – AFP TSMC to produce TOKYO: Taiwan’s TSMC said yesterday it will produce three-nanometre semiconductors – among the most advanced chips that can power AI systems – at a factory currently under construction in Japan. The firm is the world’s biggest contract maker of microchips used in everything from Apple phones to Nvidia’s artificial intelligence hardware. It opened its first Japanese chip plant two years ago in the southwestern region of Kumamoto – touting it as a move to boost the resiliency of chip supply for Japan and worldwide. TSMC is also building a second factory there, reportedly originally slated to churn out six-nanometre chips for teleco devices. Three- and six-nanometres are marketing terms, but in general the smaller the number, the higher the density of microscopic components in each chip, and the better the performance. The move to three-nanometre tech is to “meet strong demand driven by AI”, TSMC’s public relations office said. Chief executive C.C. Wei told Japanese Prime Minister Sanae Takaichi of the plan to “use 3nm technology for production” at the Japan subsidiary’s second factory in Kumamoto, it said. If realised, the manufacturing of three-nanometre chips will be the first in Japan, public broadcaster NHK said. But they are not the most cutting-edge type on the market, with TSMC already mass-producing next-generation two-nanometre chips in Taiwan. Japanese chipmaker Rapidus is also building a plant in northern Japan to make two-nanometre chips, with production set to start in 2027. Takaichi yesterday hailed cooperation with TSMC as a “prime example” of how her cabinet is seeking to ramp up high-tech investment. – AFP advanced chips at Japan plant

JAKARTA: Indonesia reported its best economic expansion in three years in 2025 as growth accelerated more than expected in the fourth quarter on robust household spending and strong investment, official data showed yesterday. Southeast Asia’s biggest economy grew 5.11% annually in 2025, up from 5.03% a year earlier. It was the highest annual growth rate since 2022, but still below the government’s target of 5.2%. President Prabowo Subianto wants the US$1.4 trillion economy to grow by 8% by 2029, but analysts say he faces headwinds, including slowing international trade due to US tariffs and geopolitical tensions, as well as domestic factors like souring investor sentiment. The government increased its fiscal stimulus in 2025 to prop up demand and vowed to stay on course this year. The central bank cut interest rates by 150 basis points between September 2024 and September 2025 and analysts say more cuts are likely. In the fourth quarter, the growth rate was 5.39% on a yearly basis, the quickest pace since the third quarter of 2022. Analysts in a Reuters poll expected 5.01%. o Some analysts doubt official data, point to weak tax collection WASHINGTON: The United States on Wednesday unveiled a critical minerals partnership with the European Union and Japan, after a gathering in Washington amid growing concerns about China’s dominant role in the sector. The partners aim to develop “coordinated trade policies and mechanisms, such as border-adjusted price floors, that can mitigate critical mineral supply chain vulnerabilities”, said the US Trade Representative’s office in a statement. Critical minerals include rare earth metals, which are key to the production of goods like smartphones, fighter jets and electric cars. But these resources have become a bargaining chip, particularly as major producer China introduced restrictions on rare earth exports last year, raising alarm in the United States and elsewhere. Washington and its allies are now racing to develop alternative mining and processing supply chains. A joint press statement by the United States, European Commission and Japanese government said on Wednesday that the partners are “taking significant steps towards increasing their economic security and national security” by boosting resilience in the critical minerals sector. “Today’s announcement is an important signal that the world’s largest market-oriented economies are committed to developing a new paradigm for preferential trade in critical minerals,” US Trade Representative Jamieson Greer said. Their “strategic partnership” has two components. One involves the push towards a memorandum of understanding between the United States and EU to identify and support mining, refining, processing and recycling projects.

investment by sovereign wealth fund Danantara. Brian Lee, economist with Maybank, expected only a marginal pickup in 2026. “The recent market selloff could hit consumer confidence,” Lee said, referring to last week’s plunge in Jakarta’s main equity index triggered by concerns about transparency and liquidity. Analysts also said Prabowo’s crackdown on the resources sector, including the takeover of the Martabe gold mine in disaster-hit North Sumatra, could weigh on investment sentiment. Some economists questioned the veracity of the GDP data, pointing to declining 2025 tax revenues and other indicators, including flat growth in foreign direct investment. “One may wonder whether the (household spending) growth rate is still too high, given the sluggish labour market and reports of lower-than-usual tourism activities on top of the low tax collection,” said Rizki Siregar, an economist at the University of Indonesia. Nailul Huda, an economist with the Centre of Economic and Law Studies, said there was a discrepancy between data on high net exports in 2025 and strong investment growth coming from the imports of machinery.

Statistics Amalia Adininggar Widyasanti said a 16.23 trillion rupiah (RM3.8 billion) stimulus package in the final quarter helped raise household spending, while investment was another strong growth driver. The stimulus measures included the distribution of rice to 18.3 million households and the waiving of personal income tax for workers in the tourism sector. Household spending, which makes up more than half of Indonesia’s gross domestic product, grew 5.11% in the October-to-December quarter, the fastest pace in more than two years. For all of 2025, household spending grew 4.98%, the fastest since 2019, while investment growth of 5.09% was the highest since 2018. “Domestic demand rebounded in Q4 2025 with the shift in fiscal policy stance following the change in leadership in the Finance Ministry in September 2025,” said ANZ economist Krystal Tan, calling the pace “solid”. Pro-growth economist Purbaya Yudhi Sadewa was appointed finance minister in September, replacing the more fiscally conservative Sri Mulyani Indrawati. But Sri Mulyani’s abrupt sacking, a widening budget deficit and the appointment of Prabowo’s nephew to the central bank triggered capital outflows, sending the rupiah to a historic low against the US dollar last month. The government has targeted 5.4% growth in 2026, relying on more spending for Prabowo’s flagship programmes and Indonesia chief

Several local think tanks had also questioned the third-quarter GDP data last year, arguing it did not reflect indicators like falling auto sales, a contraction in manufacturing activity and reports of layoffs. – Reuters US, EU and Japan unveil critical minerals partnership

US Vice-President JD Vance speaks during the inaugural Critical Minerals Ministerial meeting at the State Department in Washington. – AFPPIC The aim is to stimulate demand and diversify supply on both sides. This could include the development of price floors, price gap subsidies and other elements. On Wednesday, Greer separately

Washington and Tokyo have previously signed a framework deal covering similar areas. The other component of Wednesday’s agreement is a critical minerals “trade initiative with like-minded partners”.

announced a US-Mexico cooperation plan on critical minerals too, which includes exploring how price floors may be worked into future trade agreements. – AFP