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U.S., China agree tentative trade truce

Ahead of G20 summit

The United States and China have agreed to a tentative truce in their trade dispute ahead of a meeting between leaders of the two nations at the G20 summit this weekend, the South China Morning Post reported on Thursday, citing sources.

Details of the agreement, which would halt the next round of U.S. tariffs on an additional $300 billion of Chinese goods, are being laid out in press releases and will be out as coordinated press releases and not a joint statement, the newspaper said.

Chinese President Xi Jinping’s meeting with U.S. President Donald Trump is conditional upon Washington agreeing to such a tentative agreement, SCMP reported, citing one source with knowledge of the plans.

Trump is set to hold much-anticipated trade talks with Xi in Osaka at 11:30 a.m. (0230 GMT) on Saturday, a White House spokesman told reporters on Wednesday.

http://www.reuters.com

Huawei announces swingeing cuts to production

Sales plummet 40 per cent

Huawei has revealed revised plans for the next two years, and they’re not pretty. Company founder Ren Zhengfei has admitted that sales, since the US trade ban began, have plummeted 40 per cent outside China, leading to a revision of production targets.

The company will be slashing $30bn (£24bn) from its production budget over the next 24-months. This will mean that the company’s sales will flatline at $100bn during that time, where it had been widely expected to emerge as the biggest company in the mobile market sometime during that period. Mr Ren added that the company will have to “remain vigilant” in 2021, although sales in its home market of China remain buoyant.

http://www.theinquirer.net

Huawei files to trademark mobile OS around the world after U.S. ban

Homgmeng to replace Android

China’s Huawei is in the process of potentially launching its “Hongmeng” operating system (OS) to replace the U.S. Android OS, an executive said on Thursday, after Reuters reported that the company has applied to trademark the OS in various countries.

Data from a U.N. body showed that Huawei Technologies Co Ltd is aiming to trademark the OS in at least nine countries and Europe, in a sign it may be deploying a back-up plan in key markets as U.S. sanctions threaten its business model. President Donald Trump’s administration last month put Huawei on a blacklist that barred it from doing business with U.S. tech companies such as Alphabet Inc, whose Android OS is used in Huawei’s phones. Andrew Williamson, vice president of Huawei’s public affairs and communications, said Hongmeng was moving forward.

Huawei, the world’s biggest maker of telecoms network gear, has filed for a Hongmeng trademark in countries such as Cambodia, Canada, South Korea and New Zealand, data from the U.N. World Intellectual Property Organization (WIPO) shows. It also filed an application in Peru on May 27, according to the country’s anti-trust agency Indecopi. Huawei has a back-up OS in case it is cut off from U.S.-made software, Richard Yu, chief executive of the company’s consumer division, told German newspaper Die Welt in an interview earlier this year.

http://www.reuters.com

Trade war escalation will hit China harder than the US

China’s GDP size will be 1.6 per cent lower in 2019

A further escalation of the trade war between the US and China would take a major toll on economic growth in both countries next year, with China the bigger casualty, according to an economic analysis released by the International Monetary Fund on Tuesday.

The world economy would also suffer, the IMF said. Based on the trade tariffs already in place, the organisation revised down its estimates of world growth this year and next by 0.2 of a percentage point to a still healthy 3.7 per cent.

https://www.scmp.com/

Beijing threatens to cut off the rare earth metal sales to gain leverage on trade

Shares of rare earth miners skyrocket

Shares of rare earth miners in Asia Pacific surged on Wednesday after Beijing made a veiled threat toward Washington regarding the materials. In China, shares of JL Mag Rare-Earth skyrocketed around 10% while Innuovo Technology jumped 9.95%. Lynas in Australia — one of the few rare earth miners outside of China — saw its shares surge more than 15%. The moves came after a Chinese official recently cautioned that products made from rare earth minerals should not be used against the country’s development.

Big gaming partnership between Tencent and Roblox

$2.5 billion video game company Roblox and China’s Tencent defied the growing tech ‘cold war’

Roblox, a global online experience bringing more than 90 million people together through play, and Tencent Holdings Limited, one of the largest internet companies in the world, today announced a strategic partnership to help fuel the next generation of Chinese creators.

Roblox is on a mission to bring the world together through play by inspiring imagination, creativity, and learning through shared online experiences. Roblox will accelerate these efforts in China through the strategic partnership with Tencent. Together, the companies will establish a joint-venture company with an initial focus on education to teach coding fundamentals, game design, digital citizenship, and entrepreneurial skills. Based in Shenzhen, the joint venture will create opportunities for local Chinese developers to leverage the global Roblox ecosystem, with the ultimate goal of bringing Roblox to China.

Trade war: Trump Gives Farmers $16 Billion

Some American companies shift business away from China

President Trump on Thursday unveiled a $16 billion bailout for farmers hurt by his trade war with Beijing, signaling a protracted fight ahead that is already prompting some American companies to shift business away from China.

Mr. Trump, flanked by farmers and ranchers in cowboy hats during remarks at the White House, said China had “taken advantage” of the United States for far too long and vowed to protect an industry that has been “used as a vehicle” by Beijing to hurt America’s economy.

“Farmers have been attacked by China,” Mr. Trump said, adding that if the United States is in a trade war, “we’re winning it big.”

Global markets tumbled on Thursday as investors began coming to terms with the idea that Mr. Trump’s trade war is here to stay.

Trump expected to sign order to ban Huawei

The White House  invokes the International Emergency Economic Powers Act

President Donald Trump is expected to sign an executive order this week barring U.S. companies from using telecommunications equipment made by firms posing a national security risk, paving the way for a ban on doing business with China’s Huawei, three U.S. officials familiar with the plan told Reuters.

The order, which will not name specific countries or companies, has been under consideration for more than a year but has repeatedly been delayed, the sources said, asking not to be named because the preparations remain confidential. It could be delayed again, they said.

The executive order would invoke the International Emergency Economic Powers Act, which gives the president the authority to regulate commerce in response to a national emergency that threatens the United States. The order will direct the Commerce Department, working with other government agencies, to draw up a plan for enforcement, the sources said.

http://www.reuters.com

U.S. hikes tariffs on Chinese goods

China says to strike back

U.S. President Donald Trump’s tariff increase to 25 percent on $200 billion worth of Chinese goods took effect on Friday, and Beijing said it would strike back, ratcheting up tensions as the two sides pursue last-ditch talks to try salvaging a trade deal.

China’s Commerce Ministry said it “deeply regrets” the U.S. decision, adding that it would take necessary countermeasures, without elaborating.

The hike comes in the midst of two days of talks between top U.S. and Chinese negotiators to try to rescue a faltering deal aimed at ending a 10-month trade war between the world’s two largest economies.

http://www.reuters.com/

Chinese shares hit by Trump tariff threat

Chinese stock markets tumbled

US President Donald Trump threatened new tariffs on China, putting a trade deal in doubt.  He said on Twitter the US would more than double tariffs on $200bn (£152bn) of Chinese goods on Friday and would introduce fresh tariffs.

Recent comments had suggested both sides were nearing a trade deal. A Chinese delegation was due to travel to Washington this week for talks aimed at ending the trade war. US media has reported that China is now considering cancelling those talks, that were scheduled to resume on Wednesday.

http://www.bbc.com

Defence Secretary Gavin Williamson sacked over Huawei leak

Compelling evidence

Downing Street said the PM had “lost confidence in his ability to serve” and Penny Mordaunt will take on the role. The inquiry followed reports over a plan to allow Huawei limited access to help build the UK’s new 5G network. Mr Williamson, who has been defence secretary since 2017, “strenuously” denies leaking the information.

In a meeting with Mr Williamson on Wednesday evening, Theresa May told him she had information that provided “compelling evidence” that he was responsible for the unauthorised disclosure.In a letter confirming his dismissal, she said: “No other, credible version of events to explain this leak has been identified.”

http://www.bbc.com

Huawei set to win smartphone sales race

Samsung leadership at stake

Huawei is on track to outstrip Samsung to become the world’s biggest-selling smartphone brand by the end of this year. The Chinese tech behemoth said last week that it would tap into its bourgeoning consumer business to sustain growth.

Huawei’s snappy smartphones and laptops, which offer distinct value for money, have poached discerning buyers from Apple and Samsung, helping the Chinese company remain confident despite the US-led blanket ban on its business-to-business telecommunications gear, which has seen revenues from wireless and base station equipment go flat.

http://www.asiatimes.com

Asian shares fall as China manufacturing data disappoints

Slower Chinese factory growth

Shares in Asia fell on Tuesday as readings on China’s manufacturing activity failed to meet expectations, underscoring weakness in the world’s second-largest economy despite Beijing’s attempts to spur growth.

Both official and private business surveys pointed to slower Chinese factory growth this month, dashing hopes for a steady reading or even a faster expansion. Data also showed a slower expansion in its services sector, adding to economic uncertainty.

The dollar-denominated MSCI index of Chinese shares dropped 0.8 percent. But Chinese blue chips in Shanghai and Shenzhen kept losses in check, losing less than 0.1 percent as investors maintained hopes for further measures to prop up the economy.

The weak manufacturing numbers suggest “stimulus is there to stay,” said Frances Cheung, head of macro strategy for Asia at Westpac. Upbeat data for March had prompted some analysts to scale back expectations of additional support measures.

http://www.reuters.com

Wall Street rallies

Strong China, US manufacturing data

U.S. stocks rallied on Monday, starting off the second quarter on a strong note, as upbeat manufacturing numbers from China and the United States eased worries about slowing global growth.

The benchmark S&P 500 index, which is only 2.2 percent below its record closing high in September, triggered a “golden cross” pattern, in which its 50-day moving average crosses above its 200-day moving average. Many believe the technical signal could portend more gains for stocks in the short term.

Gains in global equities were spurred by data showing that China’s manufacturing sector unexpectedly returned to growth in March for the first time in four months.

https://www.reuters.com/