Beijing, Sep 10 (AP/UNB) — Alibaba Group founder Jack Ma, who helped launch China's online retailing boom, stepped down as chairman of the world's biggest e-commerce company Tuesday at a time when its fast-changing industry faces uncertainty amid a U.S.-Chinese tariff war.
Ma, one of China's wealthiest and best-known entrepreneurs, gave up his post on his 55th birthday as part of a succession announced a year ago. He will stay on as a member of the Alibaba Partnership, a 36-member group with the right to nominate a majority of the company's board of directors.
Ma, a former English teacher, founded Alibaba in 1999 to connect Chinese exporters to American retailers.
The company has shifted focus to serving China's growing consumer market and expanded into online banking, entertainment and cloud computing. Domestic businesses accounted for 66% of its $16.7 billion in revenue in the quarter ending in June.
Chinese retailing faces uncertainty amid a tariff war that has raised the cost of U.S. imports.
Growth in online sales decelerated to 17.8% in the first half of 2019 amid slowing Chinese economic growth, down from 2018's full-year rate of 23.9%.
Alibaba says its revenue rose 42% over a year earlier in the quarter ending in June to $16.7 billion and profit rose 145% to $3.1 billion. Still, that was off slightly from 2018's full-year revenue growth of 51%.
The total amount of goods sold across Alibaba's e-commerce platforms rose 25% last year to $853 billion. By comparison, the biggest U.S. e-commerce company, Amazon.com Inc., reported total sales of $277 billion.
Alibaba's deputy chairman, Joe Tsai, told reporters in May the company is "on the right side" of issues in U.S.-Chinese trade talks. Tsai said Alibaba stands to benefit from Beijing's promise to increase imports and a growing consumer market.
Alibaba is one of a group of companies including Tencent Holding Ltd., a games and social media giant, search engine Baidu.com Inc. and e-commerce rival JD.com that have revolutionized shopping, entertainment and consumer services in China.
Alibaba was founded at a time when few Chinese were online. As internet use spread, the company expanded into consumer-focused retailing and services. Few Chinese used credit cards, so Alibaba created the Alipay online payments system.
Ma, known in Chinese as Ma Yun, appears regularly on television. At an annual Alibaba employee festival in Hanzhou, he has sung pop songs in costumes that have included blond wigs and leather jackets. He pokes fun at his own appearance, saying his oversize head and angular features make him look like the alien in director Steven Spielberg's movie "E.T. The Extraterrestrial."
The company's $25 billion initial public offering on the New York Stock Exchange in September 2014 was the biggest to date by a Chinese company.
The Hurun Report, which follows China's wealth, estimates Ma's fortune at $38 billion.
In 2015, Ma bought the South China Morning Post, Hong Kong's biggest English-language newspaper.
Ma's successor as chairman is CEO Daniel Zhang, a former accountant and 12-year veteran of Alibaba. He previously was president of its consumer-focused Tmall.com business unit.
Alibaba's e-commerce business spans platforms including business-to-business Alibaba.com, which links foreign buyers with Chinese suppliers of goods from furniture to medical technology, and Tmall, with online shops for popular brands.
Alipay became a freestanding financial company, Ant Financial, in 2014. Alibaba also set up its own film studio and invested in logistics and delivery services.
Ma faced controversy when it disclosed in 2011 that Alibaba transferred control over Alipay to a company he controlled without immediately informing shareholders including Yahoo Inc. and Japan's Softback.
Alibaba said the move was required to comply with Chinese regulations, but some financial analysts said the company was paid too little for a valuable asset. The dispute was later resolved by Alibaba, Yahoo and Softbank.
Corporate governance specialists have questioned the Alibaba Partnership, which gives Ma and a group of executives more control over the company than shareholders.
Ma has said that ensures Alibaba focuses on long-term development instead of responding to pressure from financial markets.
Yokohama, Sep 9 (AP/UNB) — Nissan Chief Executive Hiroto Saikawa tendered his resignation Monday after acknowledging that he had received dubious income and vowed to pass the leadership of the Japanese automaker to a new generation.
Board member Yasushi Kimura told reporters at an evening news conference at company headquarters in Yokohama that the board has approved Saikawa's resignation, effective Sept. 16, and a successor will be appointed next month. A search is underway, he added.
Calls for Saikawa's resignation, which arose after the arrest last year of his predecessor, Carlos Ghosn, on various financial misconduct allegations, have grown louder after Saikawa acknowledged last week that he had received dubious payments.
The income was linked to the stock price of Nissan Motor Co., and he has said his pay got inflated by illicitly adjusting the date for cashing in.
The automaker's board met to look into the allegations against Saikawa, as well as other issues related to Ghosn's allegations and corporate ethics at the company.
Kimura said the income Saikawa had received was confirmed as "not illegal."
Ghosn, who is out on bail and awaiting trial, says he's innocent.
Kimura and three other board members, who all have backgrounds outside the company, said their investigation of the scandal over Ghosn's arrest found that alleged misconduct by Ghosn and Greg Kelly, a former board member who was also arrested, had caused 35 billion yen ($350 million) in damage to the company.
Nissan will seek a repayment of the damages, Kimura said.
The board said about 10 candidates are being considered as a replacement for Saikawa. They did not identify them, but said outsiders and non-Japanese are on the list. Until a successor is decided, Chief Operating Officer Yasuhiro Yamauchi will serve as interim chief, the board said.
Saikawa has not been charged.
"I have been trying to do what needs to be done so that I can pass the baton over as soon as possible," he told reporters earlier in the day, referring to his willingness to leave his job.
Saikawa did not appear at the news conference initially, but the four board members who led the event said he would later.
Saikawa has said he didn't know about the improprieties, promised to return the money and blamed the system he said Ghosn had created at Nissan for the dubious payments.
Japanese media reports said Saikawa had received tens of millions of yen (hundreds of thousands of dollars) in extra compensation.
Ghosn has been charged with falsifying documents on deferred compensation, which means he did not receive any of the money.
Nissan's profits and sales have tumbled over the past year. Investors are also worried about Nissan's relationship with alliance partner Renault SA of France, which owns 43% of Nissan. Ghosn was sent in by Renault to lead Nissan two decades ago.
Dhaka, Sept 2 (UNB) – Filipino stakeholders are keen to develop the economic ties between Bangladesh and the Philippines viewing Bangladesh as a promising market.
They expressed the view at a seminar on “Promoting Bilateral Trade and Investment between Bangladesh and Philippines” organised by Dhaka Chamber of Commerce & Industry (DCCI) in collaboration with Bangladesh Philippines Chamber of Commerce and Industry (BPCCI) in the city on Monday.
Jeremiah C Reyes, Philippines Commercial Attache, said that the economic ties between both countries should be closer. “Bangladesh is a potential market. So we want to explore this promising market,” he said.
DCCI also hosted a B2B matchmaking between the visiting Philippines trade team and their Bangladeshi counterparts.
Agnes Perpetua R. Legaspi, Assistant Director, Department of Trade and Industry (DTI), Republic of the Philippines, led the delegation.
Presiding over the seminar, DCCI President Osama Taseer said that the bilateral trade till now has been insignificant in terms of both value and share, hovering around $65 million during FY2017-18.
“Bangladesh can develop its agriculture with the knowledge transfer from Philippines, skills in food production, processing, canning and packaging, IT, Business Process Outsourcing (BOP), electronics, tourism, etc. On the other hand, the Philippines can collaborate with Bangladesh’s RMG, pharmaceuticals and ceramics sector,” he said.
He underscored the importance of direct flights between Bangladesh and the Philippines for increasing people-to-people contacts. Moreover, preferential trade agreements leading to bilateral free trade agreement could open up substantial economic gains for both countries.
Ambassador of the Philippines in Bangladesh Vicente Vivencio T. Bandillo could not attend the seminar but sent his written speech through Leo Marco C. Vidal, Charge D’ Affaires, Embassy of the Philippines in Bangladesh.
The Ambassador said in his written speech that the Philippines would like to export more to Bangladesh. They would like to see more Filipino companies taking advantages of the opportunities in Bangladesh for trade and investment. They will welcome more Bangladeshi exports to Philippines.
He also invited Bangladeshi companies to invest in Philippines to boost bilateral trade volume.
Engr. Akber (AL) Hakim, President of BPCCI and Director of DCCI said that its time for Asia. Asia is going to overtake the rest of the world by 2020 on PPP basis. Contribution of Asia in the world GDP is 42% in terms of PPP basis.
“The size of economy of Bangladesh and Philippines will reach around US$ 3 trillion and 3.3 trillion respectively,” he said.
He urged the businessmen of Philippines to import RMG, leather and leather goods, jute and jute goods, vegetables from Bangladesh.
He said Philippines can help Bangladesh in skill development, training for skill development, IT and IT enabled services, Business process Outsourcing (BPO), hospitality and nursing. The Philippines receives $30 billion as remittance every year through their skilled workforce, he said.
Agnes Perpetua R. Legaspi, Assistant Director, Department of Trade and Industry (DTI), Republic of the Philippines urged increasing the existing bilateral trade.
DCCI’s former President R M Khan, Directors Alhaj Deen Mohammad, Enamul Haque Patwary, Hossain A Sikder, Engr. Md. Al Amin, Nuher L. Khan, Shams Mahmud, former Director Rizwan Ur Rahman were also present on the occasion.
Dhaka, Aug 31 (AP/UNB) - Major U.S. stock indexes ended little changed Friday after a listless day of trading ahead of the Labor Day holiday weekend capped a solid week of gains for the market.
A late-afternoon flurry of buying gave the S&P 500 its third straight gain. The benchmark index also snapped a string of four consecutive weekly losses. Even so, the market closed out August with its second monthly decline this year, after May.
Financial, industrial and health care stocks were among the big winners. Those sectors outweighed losses in consumer goods makers and communication services stocks. Shares in companies that rely on consumer spending also fell.
The stock indexes wavered between small gains and losses through much of the day, with trading volumes lighter than usual.
"Going into a holiday weekend you just have three days here where you're not going to be able to reposition, so people are probably taking some profits and squaring their books ahead of the weekend," said Sameer Samana, senior global market strategist at Wells Fargo Investment Institute.
The S&P 500 edged up 1.88 points, or 0.1%, to 2,926.46. The Dow Jones Industrial Average rose 41.03 points, or 0.2%, to 26,403.28. The Nasdaq gave up an early gain, sliding 10.51 points, or 0.1%, to7,962.88. The Russell 2000 index of smaller company stocks dropped 1.88 points, or 0.1%, to 1,494.84.
The major indexes stemmed their August slide this week, but still ended the month with losses. The Dow dropped 1.7%, the S&P 500 lost 1.8% and the Nasdaq gave up 2.6%. The Russell took the heaviest losses for the month, falling 5.1%.
Trading turned volatile in August as investors worried that the escalating trade war between the U.S. and China and a slowing global economy could tip the U.S. into a recession. The bond market seemingly confirmed these fears when long-term bond yields fell below short-term ones, a so-called inversion in the U.S. yield curve that has correctly predicted previous recessions.
"We found the limits of how far both the U.S. and the Chinese side can push the trade issue until it actually starts to manifest itself in markets," Samana said. "And where you probably saw the bulk of that reaction is in the fixed-income market. That's why you saw long-term yields basically collapse."
Bond prices initially fell Friday, pushing yields higher, but then lost momentum. That pushed long-term bond yields further below short-term ones. The yield on the 10-year Treasury fell to 1.50% from 1.51% late Thursday. The 2-year Treasury yield dropped to 1.51% from 1.55% the day before.
Washington and Beijing are deadlocked in talks over U.S. complaints about China's trade surplus and industrial plans, which its trading partners say are based on stealing or pressuring companies to hand over technology.
Last week, the trade conflict escalated again with both sides threatening new tariffs on each other's goods, triggering a sharp sell-off in global markets.
Some of the Trump administration's additional tariffs on Chinese products take effect Sunday and others on Dec. 15. In addition, higher tariffs on a separate group of Chinese products are to take effect Oct. 1.
Still, investors were encouraged by a Chinese government statement Thursday that its penalties on U.S. products are adequate. That suggested Beijing might be pausing in the tit-for-tat cycle of tariff increases that has raised fears the global economy might tip into recession.
Negotiators meet next month in Washington after the latest round of talks in July in Shanghai produced no sign of progress.
Investors also weighed a mixed batch of corporate earnings reports Friday.
Campbell Soup rose 3.9% and Big Lots added 3.4%. Both companies reported quarterly profits that easily beat analysts' forecasts. Ulta Beauty plunged 29.6%, it's biggest drop ever, after the company reported weak results and cut its estimates.
Benchmark crude oil fell $1.61 to settle at $55.10 a barrel. Brent crude oil, the international standard, fell 65 cents to close at $60.43 a barrel. Wholesale gasoline fell 7 cents to $1.61 per gallon. Heating oil declined 3 cents to $1.83 per gallon. Natural gas fell 1 cent to $2.29 per 1,000 cubic feet.
Gold fell $7.40 to $1519.10 per ounce, silver rose 2 cents to $18.19 per ounce and copper fell 3 cents to $2.53 per pound.
The dollar fell to 106.25 Japanese yen from 106.62 yen on Thursday. The euro weakened to $1.0978 from $1.1052.
U.S. markets will be closed Monday for Labor Day.
Washington, Aug 30 (UNB/AP) — The U.S. economy slowed in the spring, and most analysts expect it to weaken further in the months ahead. Yet the main driver of growth — consumer spending — remains vigorous enough to keep the economy growing steadily if still modestly.
Spending by households, which accounts for about 70% of economic growth, accelerated in the April-June quarter to its fastest pace in nearly five years. Eventually, President Donald Trump's tariffs on hundreds of billions of dollars in imports could bring higher prices and lower consumer spending. But for now, household spending remains a vital pillar of the economy.
The nation's gross domestic product — the broadest gauge of economic health — grew at a moderate 2% annual rate in the April-June quarter, the Commerce Department reported Thursday. That was down from a 3.1% growth rate in the first quarter, but it would have been much weaker without a burst of consumer demand.
Economists generally expect growth to slow to a 2% annual rate or less for the rest of the year. But most think consumer spending will be enough to offset headwinds ranging from a slowing global economy to growing uncertainties caused by Trump's trade war with China.
In the April-June period, consumer spending shot up to an annual rate of 4.7%, the best showing since the final quarter of 2014. The surge followed two weak quarters for spending as car sales sank and households grew cautious after a stock market fall and a partial shutdown of the government.
At the same time, business investment is weakening in the face of the uncertainties created by the taxes that Trump has imposed on numerous imports — goods that many American businesses rely upon.
Gus Faucher, chief economist at PNC Financial, said he expects the trade war to begin to weigh on consumers in the second half of this year as some of Trump's additional tariffs on Chinese products take effect Sunday and others on Dec. 15. In addition, higher tariffs on a separate group of Chinese products are to take effect Oct. 1.
Faucher said thinks growth is slowing to a 1.5% annual rate in the current July-September quarter and will dip to around a sluggish 1.3% rate in the fourth quarter.
"On the plus side, consumers remain in good shape ... with solid job growth and good wage gains," Faucher said. "But the higher tariffs are going to cause consumers to pull back for a time, especially on big-ticket items like cars and appliances."
But by mid-2020, Faucher said, he expects spending to start accelerating as consumers become used to the higher tariffs. He said he thinks the strength from such spending will help avoid a recession.
The latest earnings reports from retailers show that some stores are faring better than others. Discounters are doing well, with Dollar Tree, Dollar General and Five Below all reporting solid sales figures in the most recent quarter.
And although Best Buy managed to post an increase in a key sales figure, it was overshadowed by disappointing revenue and by concerns about Trump's taxes on Chinese imports. The electronics retailer lowered its revenue outlook for the year, citing the expected impact of tariffs.
Best Buy said it expects TVs, smartwatches and headphones to be affected by tariffs that take effect Sept. 1. Computers, smartphones and video game consoles would come next on Dec. 15.
CEO Corie Barry said she was unsure if Best Buy will raise prices yet, saying it's difficult to predict how customers would respond.
Trump, who is counting on a strong economy to support his re-election bid, has a decidedly upbeat view of the economy. In a tweet Thursday, Trump asserted that "the economy is doing GREAT, with tremendous upside potential! If the Fed would do what they should, we are a Rocket upward!"
The president, who last week called Federal Reserve Chairman Jerome Powell an "enemy," has been demanding that the Fed cut rates by a full percentage point — a proposal that most economists regard as wildly excessive. The Fed did cut rates by a quarter-point last month, the first rate reduction in a decade, and is expected to do so again at least twice more this year.
Some analysts say they think the expectation of further rate cuts makes them believe that the economy won't be pushed into a recession by the trade war.
The 2% annual GDP growth in the April-June quarter represented a slight downward revision from the government's first estimate of a 2.1% growth rate. Trump has pledged to achieve annual growth at annual rates of 3% or better. But economists generally foresee GDP slowing sharply after hitting 2.9% last year.
For all of 2019, economists estimate that GDP will slow to around 2.2% and then drop to below 2% in 2020 as the economy faces headwinds from the global slowdown and the effects from the escalating trade war with China.
The biggest factor in the government's downward revision for the April-June quarter was a smaller gain in spending by state and local governments and fewer export sales. American exports have been hurt by the retaliatory tariffs China and other countries have imposed on U.S. soybeans and other products.
Business investment spending turned negative in the second quarter, falling at a 0.6% annual rate, which many economists believe occurred because of the uncertainty among businesses resulting from Trump's trade war.
Mark Zandi, chief economist at Moody's Analytics, said he isn't forecasting a recession in the next 18 months but said one can't be ruled out in light of Trump's trade war with China.
"If the president continues to ratchet up the rhetoric and his tariffs on China, it will continue to unnerve business people who are already being more cautious with their investment plans," Zandi said. "The risks of going into a recession are high if the president keeps escalating his trade war."