25/02/2026

BIZ & FINANCE WEDNESDAY | FEB 25, 2026

18

China restricts exports to Japan firms

StanChart’s full-year profit rises as it gains from trade tensions HONG KONG: Standard Chartered’s full-year pre-tax profit rose 16% on robust performances from its global banking and wealth businesses, as it made progress on its shift to more fee-based income amid global trade tensions. The lender also announced a US$1.5 billion share buyback that it said would start imminently, and noted that its full-year dividend was up 65% from a year earlier. US President Donald Trump’s imposition of tariffs on most of his country’s trading partners had led to fears that the bank, which is focused on both emerging markets and trade, would suffer. But it has, instead, benefited from the disruptions to global supply chains. “We are seeing robust growth in our larger markets, and structural shifts in global trade and investment play to our distinctive strengths serving our clients’ cross-border and affluent banking needs,” CEO Bill Winters said. StanChart also set out modest new guidance for statutory return on tangible equity, a key profitability metric, to be greater than 12% in 2026, compared with previous guidance of 13% on an underlying basis for last year. The bank, which earns most of its revenue in Asia and Africa, reported pretax profit for the full year of US$6.96 billion, narrowly missing the US$7.2 billion average of 16 analyst estimates. Some of the miss was due to its full-year non-interest rate revenue, which came in at US$9.71 billion, up 12.9% on the year but behind an average forecast of US$9.95 billion. The lender’s Hong Kong-listed shares rose 3%, outperforming a 2% drop for the broader market. The bank’s wealth management division shone, with income soaring 24% in 2025 on double-digit growth in both its investment products and bancassurance businesses. Its global banking division – which offers lending, capital markets and trade services to cross-border clients – saw a 15% rise in income, driven by higher business volumes and increased capital markets activity. The bank has particularly benefited from the trend of Chinese corporates going out to boost their overseas presence and offshore investments, said Manus Costello, the bank’s global head of investor relations. – Reuters “I believe this will be a huge blow to companies involved,” Kawamura told AFP. Yee Kuang Heng, a professor in international security at the University of Tokyo, said that Japanese firms are major buyers of critical minerals gallium and germanium from China, with gallium nitride used in radar sensors on Japanese warships. “Short-term impact may be limited with a stockpile to cushion the disruptions but if the controls drag on, some damage is possible,” Heng said. – AFP Takaichi told Parliament on Friday that China was intensifying attempts to change the status quo “by force or coercion” in the East China Sea and the South China Sea. “Strengthening our defence capabilities is essential to protect the lives and peaceful livelihoods of our citizens as we face the most severe and complex security environment since the end of (World War II),” Takaichi said on Monday. Japanese firms dealing with China were already struggling with delays in getting approvals, said Noriyuki Kawamura, professor emeritus of Japan-China relations at Nagoya University of Foreign Studies. “With today’s announcement, we can expect the process will be made even more stringent.

China announced tightened controls on exports to Japan for items with potential military uses in January. This fuelled worries that Beijing may choke supplies of vital rare-earth minerals, some of which are included in China’s list of “dual-use” goods. The latest move singles out Japanese industrial heavyweights including shipbuilding and aerospace firms. Shares in Kawasaki Heavy Industries sank almost 5% in Tokyo, while Mitsubishi Heavy Industries shed close to 4% and IHI tumbled nearly 7%. Several of the firms listed are indeed active in the defence industry, manufacturing kit including ships, fighter jets and missiles for the Japanese military. Japan has been shedding its strict pacifist stance, moving to obtain “counterstrike” capabilities and to ease rules on exporting lethal defence equipment. Takaichi’s government in December approved a record defence budget worth ¥9 trillion (RM226 billion) for the coming fiscal year to expand its military capabilities. Beijing’s top diplomat Wang Yi said at the Munich Security Conference this month that forces in Japan were seeking to “revive militarism”.

o Move singles out industrial heavyweights including shipbuilding and aerospace companies

BEIJING: China imposed export restrictions on dozens of Japanese firms yesterday that it said were involved in building up Tokyo’s military, escalating a months-long row. The spat between Asia’s top two economies was sparked by comments by Prime Minister Sanae Takaichi in November that Japan could intervene militarily in any attack on self-ruled Taiwan. The measures announced yesterday cover exports of “dual-use” items –which can have civilian and military uses – to 20 Japanese entities, including subsidiaries of Mitsubishi Heavy Industries and Japan’s space agency. The commerce ministry added a further 20 Japanese organisations, including automaker Subaru, to a “watch list” requiring stricter reviews of exported items that could be used for military purposes. “The above measures are aimed at curbing Japan’s ‘remilitarisation’ and nuclear ambitions and are completely legitimate, reasonable and lawful,” a Commerce Ministry statement said.

“Honest and law-abiding Japanese entities have nothing to worry about,” it added. A Japanese Trade Ministry official told AFP that Tokyo would “take appropriate measures” after analysing the impact of the new curbs. Tokyo had strongly protested the measures and demanded they be overturned, according to deputy chief cabinet secretary Kei Sato who called Beijing’s move “absolutely intolerable and extremely regrettable”. Takaichi’s comments on Taiwan, which China views as its territory and has not ruled out taking by force, have enraged Beijing. The most visible consequence is a sharp drop in Chinese visitors to Japan – 61% in January – after Beijing warned its citizens against going there. In December, J-15 jets from China’s Liaoning aircraft carrier twice locked radar on Japanese aircraft in international waters near Okinawa, according to Japan. China has reportedly suspended imports of Japanese seafood. Japan’s last two pandas were also returned to China last month.

An Air India Airbus A350-900 at the Farnborough International Airshow in Britain. – REUTERSPIC

Air India technical incidents hit 14-month high NEW DELHI: Technical incidents such as engine oil and fuel leaks affecting Air India flights reached the highest rate in at least 14 months in January, a company document shows, underscoring growing strain on the carrier’s revamp ambitions. introduced across flight ops, training, engineering quality, and procedural oversight to prevent recurrence,” the Air India document said.

There were incidents on both its Airbus and Boeing aircraft, including five instances of fuel or engine oil leaks in the month. A Dubai-Mumbai flight on arrival found that an engine’s oil quantity was “low”. In another incident, a Delhi-Dubai flight on Jan 12 was forced to turn back after takeoff due to the absence of water in lavatory and galley, the document said. Operational incidents including rejected takeoffs, flying at a restricted altitude and taking off with incorrect settings stood at 0.29 per 1,000 flights in January, more than double the level in December 2024, the document stated. Air India’s issues have also attracted international regulatory scrutiny. Britain’s aviation authority asked Air India to explain why a Boeing Dreamliner jet that was grounded on arrival in India for safety checks took off from London with a possibly faulty fuel switch, Reuters reported this month. Air India replied that it had reminded pilots that they needed to operate in accordance with proper procedures and it had protectively replaced the throttle control module on the plane, according to a source with knowledge of the matter. – Reuters

The document provided only selective comparisons to global airline industry norms based on data that is not publicly available and did not contain information on the airline’s budget subsidiary Air India Express. Air India, which is owned by Tata Group and Singapore Airlines, has been struggling to rebuild its reputation and international network, and replace its ageing fleet that has been hobbled by supply chain delays. Pakistan’s airspace closure for Indian carriers due to diplomatic tensions has also hit it financially and forced it to shut some long-haul routes. India’s Civil Aviation Ministry told lawmakers this month that 82.5% of the 166 Air India aircraft it analysed since January 2025 had recurring technical defects, compared with 36.5% for market leader IndiGo. The ministry gave no further details. The Air India document said the technical incidents reported last month included engine stall warnings, issues related to flight control and hydraulics, and engine oil and fuel leaks.

India’s second-largest airline has come under scrutiny from the country’s safety regulator since a crash last year killed 260 people. It has since reported many safety lapses and in December admitted there was a “need for urgent improvements in process discipline, communication, and compliance culture”. In January, Air India recorded 1.09 technical incidents per 1,000 flights, quadrupling from levels of just 0.26 in December 2024, according to a document reviewed by Reuters that the carrier submitted to the Indian government in February. It did not provide earlier data. Air India operated more than 17,500 flights in January and recorded 23 technical incidents on its international and domestic flights, according to the document, which is not public. At least 21 of those incidents were investigated formally by the airline. “Systemic improvements (are) being