Page 7 - The Economist Asia January 2018

The Economist January 27th 2018
The world this week 7
Paul Romer resigned as chief The European Commission which is buying21st Century
Business economist at the World Bank. imposed a €997m ($1.2bn) fine Fox’s entertainment assets,
His two-yeartenure was a on Qualcomm forpaying includingits stake in Sky.
The Trump administration rocky one. MrRomerhad money to Apple between 2011
dismayed advocates offree chided stafffortheirpoor and 2016 with the aim ofentic- In its biggest deal for17 years,
trade by slappingpunitive grammarand overuse ofthe ingit to place Qualcomm’s American International
tariffs on American imports of word “and”, forexample, and chips in all iPhones and iPads. Group agreed to pay $5.6bn for
solarpanels and washing was recently embroiled in a It is the latest in a number of Validus, a reinsurerbased in
machines, and defended the row with staffabout the hefty antitrust penalties levied Bermuda. AIG today is a much
move as a way to protect methodology behind the by various jurisdictions on leanerinsurance company
American manufacturers bank’s annual ease ofdoing Qualcomm, which is also than before the financial crisis;
threatened by cheap Asian business report. tusslingwith Apple foralleg- its acquisition ofValidus sig-
goods. Chinese officials de- edly overchargingforits intel- nals the end ofa longperiod of
scribed the duties as a “mis- The American Senate con- lectual-property licences. retrenchment forthe firm.
use” oftrade sanctions, but firmed Jerome Powell as the
held backfrom imposing next chairman ofthe Federal There was no let up in General The road ahead
retaliatory measures. Mean- Reserve. He will take overfrom Electric’s misery. The troubled Tesla Motors put forward a
while, 11countries that border Janet Yellen on February 3rd. conglomerate reported a loss new ten-yearpay deal forElon
the Pacific, includingJapan, The 84-13 vote in favourofMr of$9.8bn forthe fourth quar- Musk that links his compensa-
Canada and Australia, agreed Powell was a widermargin of ter, as it booked a previously tion to very ambitious perfor-
on the final draft ofa free-trade support than that forMs Yellen announced charge to its insur- mance benchmarks. The boss
pact, from which MrTrump fouryears ago, although sever- ance business and tooka ofthe electric-carcompany
withdrew America duringhis al bighitters from both parties $3.5bn hit because oftaxre- receives no salary, but he could
early days in office. voted against him, including form. It also revealed that the be awarded up to $55bn in
Elizabeth Warren, Ted Cruz Securities and Exchange Com- share options if—a very big
Quids in and Marco Rubio. mission is investigatingits if—Tesla’s market value grows
accountingpractices. to $650bn, from the $58bn it is
Dollars per pound Puerto Rico’s governor, Ricar- worth today.
do Rosselló, proposed privatis- Britain’s competition regulator
1.8
Brexit vote ingthe island’s crippled and concluded that the bid by As part ofits restructuring
debt-laden electricity firm. Last Rupert Murdoch’s 21st process, Toys ‘R’ Us revealed
1.6
yearMrRosselló intervened to CenturyFox to take full con- that it will close around 180 of
stop the utility, known as trol ofSky, Britain’s premier its 880 stores in America.
1.4
Prepa, from fallingunderthe subscription-TV broadcaster, Children outside the United
1.2 control ofthe federal oversight would hand the Murdoch States will be happy to hear
board that has been appointed family “too much influence that the company has no plans
2014 15 16 17 18
to manage Puerto Rico’s bank- overpublic opinion and the to close its more than 700
Source: Thomson Reuters
ruptcy. That was before Hurri- political agenda”. Regulators international stores, fornow.
The pound breached $1.40 for cane Maria. Athird ofhomes may feel differently once Sky,
the first time since June 2016, and businesses are still and specifically its news chan- Other economic data and news
when Britain’s vote to leave without power. nel, is in the hands ofDisney, can be found on pages 76-77
the EU prompted a sell-offin
the currency. Sterlinghas risen
against the dollarbecause
markets are more optimistic
that Brexit won’t end messily;
the greenbackhas been falling
steadily since Donald Trump
came to power. Steven Mnu-
chin, the treasury secretary,
welcomed a weakdollar,
sayingit would improve
American trade prospects.
Afterhe made the remarkthe
dollarfell to a three-year low
against a basket ofcurrencies.
The IMF issued an unusually
upbeat assessment ofthe
world economy, highlighting
“notable upside surprises” in
Europe and Asia that have
helped lead to “the broadest
synchronised global growth
upsurge since 2010”. It revised
its forecast upwards forworld
GDP growth in 2018 and 2019 to
3.9% forboth years.