Exclusive - Toyota set to approve Mexico plant within weeks - sources

(GNN) - Toyota Motor (7203.T) is finalizing plans for its first passenger car assembly plant in Mexico that could be approved by its board as early as next month, according to three people with knowledge of the matter.

The plant would make the popular Corolla compact sedan and begin production in 2019. Based on recent investments by rivals, including Volkswagen (VOWG_p.DE), a new assembly plant would represent an investment of over $1 billion for Toyota.

A green light for the plant would signal an end to a 3-year expansion freeze imposed by the Japanese automaker's president Akio Toyoda, who has blamed aggressive expansion a decade ago for contributing to quality lapses and a 2009 recall crisis.

Toyoda last year asked planners scouting for a site in Mexico to hit 'pause' and review the rationale for the project, executives familiar with the matter said then. He urged executives to squeeze more production from existing factories.

Toyota is the last mass-market automaker without a major production hub in Mexico, which has lured car makers and suppliers through its low labor costs and tariff-free access to the United States, Toyota's largest single market. The Japanese firm has a plant in Mexico's Baja California that produces the Tacoma pickup truck, but it has no passenger car plant.

Last year, Mexican officials pitched half a dozen potential sites for a new plant, and Toyota executives have zeroed in on a site in the central state of Guanajuato, two people with knowledge of the deliberations said.

A delegation of Toyota executives recently spent a week in Guanajuato and remain in talks with local government officials over a potential plot of land that would give the automaker a big enough footprint to expand in the future, a source said.

"We are always evaluating our production capacity in Mexico, and in North America generally, to keep it in line with local market demand, but no such decision has been made at this time," Toyota spokesman Itsuki Kurosu told Reuters.

An official at Mexico's economy ministry had no immediate comment on Toyota's plans in the country. A spokesman for Guanajuato's economic development department declined to comment.

MEXICAN WAVE

The Mexico plant would produce a new generation of the Corolla, which will also be made at a factory in Japan, people with knowledge of the company's plans said.

Toyota said it sold close to 340,000 Corollas last year in the United States alone.

Mazda Motor (7261.T) opened an assembly plant in Guanajuato early last year, which will also produce vehicles for Toyota under an agreement between the automakers. In June last year, Daimler (DAIGn.DE) and Nissan Motor (7201.T) announced plans to build a new small car joint-venture plant in Mexico at a cost of $1.4 billion.

The wave of new investment by automakers has brought hundreds of Japanese auto parts suppliers to Mexico over the past few years. Auto production in Mexico doubled to more than 3 million vehicles a year in the five years to 2014.

Toyota's Corolla plant in Blue Springs, Mississippi, which opened in 2011, was the automaker's most recent assembly plant to come on line in North America.

With production capacity in Mexico, Japanese automakers avoid the risk of a stronger yen JPY= cutting into profits on exports and minimize the risk of a disruption to sales from events like the labor dispute that slowed trade through the U.S. West Coast earlier this year.

(Reuters)(Additional reporting by Chang-Ran Kim, Norihiko Shirouzu and Luis Rojas; Writing by Kevin Krolicki; Editing by William Mallard and Ian Geoghegan)

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Australia signals approval of China-based AIIB; Japan divided

(GNN) - Australia said on Friday there was a lot of merit in the China-led Asian Infrastructure Investment Bank (AIIB) while Japan's finance minister signalled cautious approval of the institution that the United States has warned against.

However, other top officials in Tokyo were more sceptical, reflecting a split in the government of Prime Minister Shinzo Abe over

whether joining an institution launched by Japan's main rival would help or hinder its interests.

The Sydney Morning Herald newspaper reported that Canberra could formally decide to sign up to the AIIB when the full cabinet meets on Monday.

Japan, Australia and the South Korea, all major U.S. allies, are the notable regional absentees from the AIIB. The United States, worried about China's growing diplomatic clout, has questioned whether the AIIB will have sufficient standards of governance and environmental and social safeguards.

But the opposition to the AIIB began crumbling after Britain said earlier this month that it would join the institution, maintaining it was in its national interest. France, Germany and Italy swiftly followed suit.

Australia now appears close to joining, although no formal decision has been made, and Beijing said Japan and South Korea were also considering the possibility.

China's Finance Minister Lou Jiwei said the bank would be set up by the end of the year and would complement rather than compete with other institutions, including the World Bank and the Asian Development Bank (ADB), the Manila-based multilateral institution dominated by Japan and the United States.

"All parties will by the middle of this year complete talks and sign the charter for the AIIB, and by year-end will make the charter effective and officially establish the AIIB," Lou said in an interview with state media, adding that Beijing was "maintaining communication" with the United States and Japan.

Asked about Australia, South Korea and Japan joining the bank, China's Foreign Ministry said it was "open" to it.

"They have all already expressed that they are contemplating the issue at hand," ministry spokesman Hong Lei told a daily briefing. "We are open to them making the relevant decision."

Japanese Finance Minister Taro Aso said Tokyo could consider joining the China-led bank if it could guarantee a credible mechanism for providing loans.

"We have been asking to ensure debt sustainability taking into account its impact on environment and society," he told reporters after a cabinet meeting.

"We could (consider to participate) if these issues are guaranteed. There could be a chance that we would go inside and discuss. But so far we have not heard any responses."

Other officials were more leery, reflecting Tokyo's concern over China-led lending practices, its relations with major ally Washington and the AIIB's potential rivalry with the ADB.

"We have a cautious position about participation," said top government spokesman Yoshihide Suga.

But a source familiar with Japan's policy-making said Tokyo should get involved to help ensure best practices and to avoid being left out. "Now it has become awkward as Europe joins but the U.S. and Japan stay out," the source said.

According to one senior official in the ruling coalition, the result of the differences is that Japan's participation "is not going to happen under the Abe administration".

OUR NEIGHBOURHOOD

Australian Treasurer Joe Hockey said no final decision had been made on Australia's involvement but the matter had been under careful consideration.

"More than 30 countries have already signed up. This is going to operate in our region, in our neighbourhood," he told a radio station in Brisbane.

"There is a lot of merit in it, but we want to make sure there are proper governance procedures. That there's transparency, that no one country is able to control the entity."

The Sydney Morning Herald said Canberra could invest as much as A$3 billion ($2.3 billion) in the bank and that the National Security Committee has cleared the way for the investment.

South Korean government officials denied a newspaper report that Seoul had decided to join in exchange for a five percent stake in the AIIB and the position of deputy chief.

The finance ministry said in a statement South Korea will make a decision on whether to join the bank "through close consultation with major countries and after considering various factors such as economic advantages and disadvantages".

Hockey said joining the AIIB would not affect Australia's close relationship with the United States and also referred to the gains that Australian companies could reap.

"The United States understands that this is a bank that's going to be operating in our region. It's going to be using contractors in our region. We want Australian contractors involved, we want work for Australians out of this bank," he said.

"And because it's operating in our region, in our neighbourhood, it is important that Australia fully understand and look at participating in this Bank."

($1 = 1.3067 Australian dollars)

(Reuters)(Additional reporting by Leika Kihara, Yuko Yoshikawa and Kaori Kaneko in TOKYO and Megha Rajagopalan and Michael Martina in BEIJING, Editing by Raju Gopalakrishnan)

Japan split on joining AIIB bank, caught between US, China

(GNN) - Japan is split over joining a China-led development bank, concerned about missing out on the rapidly coalescing global movement for the institution while also worried about alienating ally United States and helping bolster rival China, officials said.

Finance Minister Taro Aso signaled for the first time on Friday that Tokyo could be part of the Asian Infrastructure Investment Bank (AIIB) if it can guarantee a credible mechanism for providing loans.

But other top officials took a more skeptical stance, reflecting a split in the government of Prime Minister Shinzo Abe over whether the AIIB would help or hinder Japan's interests.

"We have a cautious position about participation," said top government spokesman Yoshihide Suga.

Around 30 countries, including Britain and Germany, have decided to participate in Beijing's flagship economic outreach project, but Washington, Japan's main ally, has urged countries to think twice before joining, citing worries about governance and environmental safeguards.

"Views are split within the Japanese government on whether to join the AIIB," said a person with close knowledge of Japan's financial policy-making.

The result of the standoff within the government, said a senior official in the ruling coalition, is that Japan's participation "is not going to happen under the Abe administration."

Japan is hesitant to join out of concern over China-led lending practices, over its relations with Washington and over the AIIB's potential rivalry with the Asian Development Bank (ADB), the Manila-based multilateral institution dominated by Japan and the United States, officials said.

By custom, the ADB is headed by a former senior official from the Bank of Japan or the country's finance ministry.

But the source familiar with Japan's policy-making said Tokyo should get involved to help ensure best practices and to avoid being left out. "Now it has become awkward as Europe joins but the U.S. and Japan stay out."

Finance Minister Aso told a news conference that the AIIB needs to have its board of directors screen and approve individual cases in deciding provision of loans.

"We have been asking to ensure debt sustainability, taking into account its impact on environment and society," he said after a cabinet meeting.

"We could (consider joining) if these issues are guaranteed. We'll give it careful consideration from diplomatic and economics viewpoints."

If the bank can address debt sustainability, environmental and societal concerns, "there could be a chance that we would go inside and discuss," he said. "But so far we have not heard any responses."

Suga, the chief cabinet secretary, interpreted Aso's comments to mean that "unless such issues are resolved, participation would be impossible."

(Reuters)(Additional reporting by Yuko Yoshikawa and Kaori Kaneko; Editing by William Mallard and Raju Gopalakrishnan)

China, Japan agree to keep momentum alive for better ties

(GNN) - China and Japan held their first security talks in four years on Thursday and agreed to keep alive and foster a nascent recovery in bilateral ties plagued by the legacy of Japan's wartime aggression and a territorial dispute.

The world's second- and third-largest economies, however, failed to set a timetable for the implementation of a scheme designed to ensure real-time communication between their armed forces.

Sino-Japanese relations have chilled over what China views as Japan's reluctance to properly atone for its wartime past as well as a dispute over a group of tiny East China Sea islets.

Patrol ships and fighter jets from both countries have shadowed each other regularly near the uninhabited islands that are controlled by Japan but also claimed by China, prompting fears that an accidental collision could spark conflict.

Japanese Prime Minister Shinzo Abe's moves to ease the constraints of Japan's pacifist constitution on its military have unnerved China. Japan says China's defence policy lacks transparency.

Abe held formal talks with Chinese President Xi Jinping last November. In the meeting, hailed by Xi as the first step toward improved ties, the two agreed to work for the implementation of a bilateral crisis management mechanism.

"Both sides agreed that the tide is beginning to turn for the better regarding relations between Japan and China following the summit meeting," a Japanese Foreign Ministry official told a media briefing after the one-day meeting.

"They also agreed that it is important to keep on taking positive steps in various areas and at various levels to firmly establish this trend."

In a sign of a thaw in Sino-Japanese ties, foreign ministers of Japan, China and South Korea are set to meet on Saturday in Seoul for the first time in nearly three years.

Xi and Abe, in their talks last year, agreed to aim for implementation of a plan for hot lines between defence officials as well as communication between vessels and aircraft to convey each other's intentions and avoid clashes.

Although both sides at the Thursday meeting agreed to work to implement the scheme at an early date, no agreement was reached on a concrete schedule toward that goal, the official said.

(Reuters)(Reporting by Kiyoshi Takenaka; Editing by Robert Birsel)

Japan confirms one citizen killed, three wounded in Tunisia attack

(GNN) - Japanese Foreign Minister Fumio Kishida said on Thursday one Japanese citizen was killed and three were wounded in an attack on Tunisia's national museum.

"We cannot forgive this despicable act of terrorism for whatever the reasons. We strongly condemn it," Kishida told reporters.

Tunisian Prime Minister Habib Essid said earlier five Japanese were among 17 people killed when gunmen wearing military uniforms stormed Tunisia's national museum on Wednesday.

Kishida did not refer to that but said there was information other Japanese people had been wounded and the Japanese government was checking.

The attack in Tunisia was one of the worst militant attacks in a country that had largely escaped the region's "Arab Spring" turmoil.

Kishida said Japan would continue to fight terrorism in cooperation with the international community.

(Reuters)(Reporting by Kaori Kaneko; Editing by Robert Birsel)

Japan PM vows new five-year plan to rebuild from 2011 disaster

(GNN) - Japanese Prime Minister Shinzo Abe on Tuesday vowed to draw up a new-five year plan to speed rebuilding from a massive 2011 tsunami and the world's worst nuclear disaster since Chernobyl that have left thousands still homeless.

Abe spoke ahead of the fourth anniversary of the devastating March 11 earthquake, which set off a massive tsunami that ravaged the Pacific coastline, killing nearly 20,000 and causing explosions and meltdowns at the Fukushima Daiichi nuclear plant.

Much remains to be done, with many towns struggling to provide jobs and permanent housing for thousands of residents, Abe told a news conference, adding that the government would prepare a new five-year reconstruction plan by this summer.

"We in the Abe government will provide all the support needed for the people in the devastated areas, who are working so hard to rebuild their lives and move ahead," Abe said.

"The current intensive five-year reconstruction plan expires next March, but we will draw up another for the next five years by this summer," he added.

He declined to give any details of the budget, apart from saying it would be decided in talks with local governments. It is estimated that the government has paid out as much as $50 billion to the three regions hardest hit by the disaster.

Abe added that the government would continue to spearhead efforts in dealing with contaminated water from the wrecked Fukushima plant, as well as its decommission.

Since the 9.0 magnitude quake, Japan has allocated more than $15 billion to an unprecedented project to lower radiation in towns near the plant, with irradiated trash piling up in 88,000 temporary storage facilities nearby.

Tokyo plans to build a more permanent storage facility in several towns abandoned due to the accident, despite opposition from some residents, a decision Abe alluded to by thanking those in agreement with the plan.

"We in the government will continue to do everything possible to deal with the issue of irradiated water as well as decommissioning the plant," he said.

"It may only be by slow steps, but reconstruction is definitely moving into a new stage."

Abe, along with Emperor Akihito, will attend Wednesday's ceremonies to mark the quake anniversary. Tokyo's subway trains will stop for a minute at 2:46 p.m. (05:46 GMT), the time the quake struck.

(Reuters)(Reporting by Elaine Lies; Editing by Clarence Fernandez)

Japan weather bureau raises chance of El Nino emerging by summer

(GNN) - Japan's weather bureau said on Tuesday that the possibility of an El Nino pattern forming by summer is higher than the 50 percent it projected in its previous monthly forecast.

Normal weather patterns may continue, but there is higher chance of an El Nino, which is often linked to heavy rainfall in some regions and drought in others, emerging by summer, the bureau said.

The El Nino weather pattern - a warming of sea-surface temperatures in the Pacific - can trigger drought in Southeast Asia and Australia, and floods in South America, hitting production of key foods such as rice, wheat and sugar.

(Reuters)(Reporting by Yuka Obayashi; Editing by Ryan Woo)

Asia slips as risk aversion prevails, dollar flies high

(GNN) - Asian stocks fell to a two-month low on Thursday as nervous markets recoiled on worries about an earlier U.S. interest rate hike, while such a prospect helped send the dollar to a 12-year high against the euro.

MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS was down 0.4 percent after touching its lowest since January. Japan's Nikkei .N225 dipped 0.1 percent and Australian and South Korean shares lost 1.1 percent and 0.7 percent.

Riskier assets both in the United States and elsewhere have come under pressure after Friday's robust U.S. employment data increased expectations that the Federal Reserve could raise rates as soon as June -a prospect that appeared relatively more remote a few weeks ago.


The possibility of higher U.S. yields siphoning away funds from riskier assets gave the S&P 500 its worst decline in two months overnight and emerging market stocks .MSCIEF declined to their lowest since early January. Mexico's peso MXN= weakened to an all-time low.

Renewed concern about Greece's debt talks with euro zone partners and deflationary pressures in China have also weighed on emerging markets in general. China will release industrial output, retail sales and investment data later in the day.

In currencies, the euro fetched $1.0713 EUR= after touching a 12-year trough of $1.0666. Downward pressure on the common currency increased after the European Central Bank kicked of its quantitative easing program and began its bond-buying on Monday.

"In addition to the ECB's starting its bond buying, Greek concerns are likely to weigh on the euro again this week, when there are several Greek-related events scheduled," said Masafumi Yamamoto, market strategist at Praevidentia Strategy in Tokyo.

Technical talks between finance experts from Athens and its international creditors are due to start later in the day with the aim of unlocking further funding.

The dollar was steady at 121.13 yen JPY=, pulled down from an eight-year high of 122.04 scaled overnight as the broad slide in equities favored the safe-haven yen.

Hit by the greenback's broad strength, the Australian dollar hovered close to a six-year trough of $0.7603 AUD=D4 reached on Tuesday.

U.S. crude oil posted a modest bounce after falling sharply overnight on the dollar's appreciation, which makes commodities denominated in the greenback costlier for holders of other currencies. [O/R]

U.S. crude was up 1.1 percent at $48.83 a barrel CLc1 after falling 3.4 percent the previous day.

(Reuters)(Editing by Kim Coghill)

Sony sees 25-fold profit jump by 2018; could exit TVs, phones

(GNN) - Sony Corp (6758.T) aims to boost operating profit 25-fold within three years by growing its camera sensors and PlayStation units, its chief executive said, outlining a strategy that could see the company exit the cut-throat TV and smartphone sectors.

CEO Kazuo Hirai said on Wednesday the Japanese consumer electronics firm would no longer pursue sales growth in areas such as smartphones where its has suffered competition from cheaper Asian rivals as well as industry leaders like Apple Inc (AAPL.O) and Samsung Electronics (005930.KS).

Sony would instead focus its spending on more profitable businesses such as camera sensors, videogames and entertainment as it seeks to return to growth after forecasting for this financial year its sixth net loss in seven years.

The comments, made just as the Tokyo market was closing, helped Sony's shares (SNE.N) rise 1.4 percent in New York.

"The strategy starting from the next business year will be about generating profit and investing for growth," Hirai told a briefing, adding that Sony's units would be given greater autonomy to make their own business decisions.

Asked about the TV and mobile phone units, Hirai said he would not "rule out considering an exit strategy", Sony's clearest statement to date about the possibility of selling or finding partners for these struggling units.

Sony is in the midst of a restructuring that has so far seen it sell off its personal computer division and spin off the TV business. It has also axed thousands of jobs.

Sony shares have risen more than 80 percent over the past year as investors applauded the restructuring, which accelerated since Hirai appointed Kenichiro Yoshida as his chief strategy officer in late 2013.

Hirai said Sony would target return on equity of more than 10 percent by the end of March 2018, adopting a yardstick Prime Minister Shinzo Abe has been promoting as a way to attract foreign investors.

He also said Sony aimed to post an operating profit of at least 500 billion yen ($4.2 billion) for 2017/18, a jump from the 20 billion yen forecast for the year ending March 31.

Sony's revamp is starting to pay off. This month, it forecast an operating profit instead of a loss for the financial year ending March 31. But it still expects to book a net loss in 2014/15, albeit a smaller amount than previously estimated.

Few expect Sony to return to the days when its Walkman and Trinitron TV defined how people around the world consumed entertainment. Analysts, however, have said it could make better use of its gadgets and access to Hollywood content.

Hirai said Sony will push to expand its PlayStation network user base, while focusing on areas such as streaming music.

($1 = 118.9800 yen)

(Reuters) (Editing by Miral Fahmy)

Japanese reporter's bid to save friend led to IS abduction

(AsiaTimes.ga) - It is an unlikely friendship that ties the fates of war correspondent Kenji Goto and troubled loner Haruna Yukawa, the two Japanese hostages for whom Islamic State militants demanded a $200 million ransom this week.

Yukawa was captured in August outside the Syrian city of Aleppo. Goto, who had returned to Syria in late October to try to help his friend, has been missing since then.

For Yukawa, who dreamed of becoming a military contractor, traveling to Syria had been part of an effort to turn his life around after going bankrupt, losing his wife to cancer and attempting suicide, according to associates and his own accounts.

A unit at Japan's Ministry of Foreign Affairs had been seeking information on him since August, people involved in that effort said. Goto’s disappearance had not been reported until Tuesday's video apparently showing him and Yukawa kneeling in orange t-shirts next to a masked Islamic State militant wielding a knife.

Yukawa first met Goto in Syria in April and asked him to take him to Iraq. He wanted to know how to operate in a conflict zone and they went together in June.

Yukawa returned to Syria in July on his own.

"He was hapless and didn't know what he was doing. He needed someone with experience to help him," Goto, 47, told Reuters in Tokyo in August.

Yukawa's abduction that month haunted Goto, who felt he had to do something to help the man, a few years his junior.

"I need to go there at least once and see my fixers and ask them what the current situation is. I need to talk to them face to face. I think that's necessary," Goto said, referring to locals who work freelance for foreign correspondents, setting up meetings and helping with the language.

Goto began working as a full-time war correspondent in 1996 and had established a reputation as a careful and reliable operator for Japanese broadcasters, including NHK.

"He understood what he had to do and he was cautious," said Naomi Toyoda, who reported with him from Jordan in the 1990s.

Goto, who converted to Christianity in 1997, also spoke of his faith in the context of his job.

"I have seen horrible places and have risked my life, but I know that somehow God will always save me," he said in a May article for the Japanese publication Christian Today. But he told the same publication that he never risked anything dangerous, citing a passage in the Bible, "Do not put the Lord your God to the test."

In October, Goto's wife had a baby, the couple's second child. He has an older daughter from a previous marriage, people who know the family said.

Around the same time, he made plans to leave for Syria and uploaded several short video clips to his Twitter feed, one showing him with media credentials issued by anti-government rebels in Aleppo.

On Oct. 22, he emailed an acquaintance, a high school teacher, to say he planned to be back in Japan at the end of the month.

Goto told a business partner with whom he was working to create an online news application that he expected to be able to travel in territory held by the Islamic State because of his nationality.

"He said that as a Japanese journalist he expected to be treated differently than American or British journalists," Toshi Maeda said, recalling a conversation with Goto before his departure for Syria. "Japan has not participated in bombing and has only provided humanitarian aid. For that reason, he thought he could secure the cooperation of ISIS."

Friends say Goto traveled from Tokyo to Istanbul and traveled from there to Syria, sending a message on Oct. 25 that he had crossed the border and was safe.

"Whatever happens, this is my responsibility," Goto said on a video recorded shortly before he set out for Raqqa, the capital of the Islamic State.

That was the last time he was seen before the IS video this week.

(Additional reporting by Nobuhiro Kubo, Teppei Kasai and Mari Saito; Editing by Will Waterman and Raju Gopalakrishnan)(GA, Reuters)

Tennis: Nishikori, Verdasco score wind-blown Kooyong wins

(ATimes/Sports) MELBOURNE: Japan’s Kei Nishikori and Spanish veteran Fernando Verdasco scored a pair of opening victories amid a “little typhoon” to begin final Australian Open preparations at the Kooyong Classic on Wednesday.US Open finalist Nishikori fought past a tough Australian challenge from Jordan Thompson to post a 6-4, 3-6, 7-6 (7-4) result while Verdasco beat Frenchman Gilles Simon 6-2, 7-6 (7/4).

Nishikori, ranked fifth in the world, was forced to work hard in swirling conditions at Kooyong Club for just over two hours.

“It was tough for both of us  — like a little typhoon out there,” said the Tokyo-born player now based in Florida. “But it was a good match for me: three sets and some good tennis.”

The eight-man warm-up event for the Australian Open starting on Monday is considered prime preparation for the first major of the season.

“Conditions made it tough to play,” added the 25-year-old Nishikori.

“It was difficult for me to be aggressive. But I played a good tie-break and I’m happy to win today.”

Verdasco also took charge of his game as he was tested by the weather.

The 33rd-ranked Spaniard collected the first set against Simon in 27 minutes and thwarted the Frenchman as Simon served to level at a set each.

Instead, he was broken to love, with Verdasco eventually winning a tie-breaker on a concluding Simon backhand error.

“This wind is tough for everyone,” said the Spaniard. “You need to be focused and hit every ball with confidence — if not it flies everywhere.

“Despite the conditions, this is perfect preparation for the Open. I like the hot conditions but you never know here.”

Nishikori came to Kooyong after a semi-final last weekend in Brisbane, where he lost to Canadian Milos Raonic in three tie-break sets.

After winning the opening set thanks to a break in the first game, Nishikori’s level slipped as Australian world number 273 Thompson made his move in the second set, winning it via a break of serve in the fourth game.

The third set was halted for a short time due to a passing shower.

When the players returned Nishikori failed to serve out for victory at 5-3, the set eventually going to a tie-break after Thompson saved a match point in the 12th game.

Nishikori took his first match point in the tie-break as the Australian double-faulted.

Later matches see Ukrainian Alexandr Dolgopolov against Serbian youngster Filip Krajinovic and another Spanish veteran Feliciano Lopez versus Richard Gasquet of France.

Source: AFP

Japan proposes joint work on Australia sub fleet: report

GNN TOKYO: Japan is proposing jointly building Australia’s new submarines, instead of exporting a new fleet, a report said Monday, after concerns in Canberra over the effect on the domestic ship-building industry.

Under the proposal, Japan’s defense ministry is to cooperate with Australia in developing special steel and other materials for its new submarines, while Tokyo will be in charge of assembling them, the Mainichi Shimbun said.

The Australian side has taken “a positive stance” on the proposal, the daily said, adding that the two countries may strike a deal by the end of 2015.

Australia needs to replace its fleet of diesel and electric-powered subs, which date from the 1990s, and Japan’s high-tech ship-building industry is through to be well-placed to win the contract.

But opposition politicians and industry groups in Australia protest that losing the contract could deal a potentially fatal blow to naval shipbuilding at home, with a knock-on effect for associated industries.

However, critics point out that Japan may be able to supply the fleet for as little as half of the cost of making it at home.

Japan is on a drive to promote its manufacturing industries abroad, with Prime Minister Shinzo Abe touring the world as salesman-in-chief.

Abe has argued that Japan must play a bigger role on the global stage and has pushed to loosen post-World War II restrictions on when its well-equipped armed forces can act.

He has also relaxed a self-imposed ban on weapons exports, paving the way for the possible deal with Australia.

Immediate confirmation of the report was not available.

Source: AFP

Dollar weakens in Asia on mixed US jobs data

GNN - TOKYO- The dollar weakened against the yen in Asia on Monday after surging last week to seven-year highs last week, while a closely watched US jobs report missed expectations.

In midday Tokyo trading, the greenback fetched 114.24 yen, down from 114.62 yen in New York and sharply lower than the 115.39 yen in Tokyo earlier Friday.

The euro was at $1.2476 against two-year lows of $1.2456 in US trade and 142.53 yen, compared with 142.78 yen.

On Friday, the US Labor Department said the world’s number-one economy added 214,000 jobs last month.

While that figure was weaker than the forecast 235,000, the previous two months’ job gains were revised upward and the unemployment rate slipped to a six-year low.

Still, the fresh data did little to boost hopes that the US Federal Reserve would hike interest rates sooner than its mid-2015 timeline, which would support the dollar.

The euro has been under pressure since the head of the European Central Bank (ECB) said last week that he was prepared to unveil more measures to kickstart the struggling eurozone economy.

On Monday, sentiment took a hit as Chinese inflation came in unchanged at 1.6 percent in October, well off the government’s target of 3.5 percent and adding to fears about the strength of the world’s number two economy.

Weekend data also showed growth in Chinese exports and imports slowed last month.

Traders are eyeing US figures, including retail sales, and eurozone factory output figures this week.

“While US data are expected to come in decent, the eurozone will likely continue to display sluggish recovery, which would justify (a) dovish ECB stance,” Credit Agricole said.

SOURCE: AFP, AIP

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• Dollar steady in Asia after jobs rally (gnn-aip.ga)

Asian shares wilt, dollar off highs

GNN - Asian shares got off to a lackluster start on Wednesday after a plunge in oil prices dragged down U.S. shares, while the dollar took a breather after this week's rally.

Crude prices steadied after falling to multi-year lows on news top oil exporter Saudi Arabia cut its U.S. sales prices.

Investors warily tracked U.S. election results, in which Republicans were poised to make major gains and possibly capture control of the Senate in a midterm vote that could serve as a public referendum on President Barack Obama's job performance.

The dollar dipped as investors locked in profits after this week's rally, while a Reuters report saying central bankers in the euro zone plan to challenge European Central Bank President Mario Draghi's leadership style underpinned the euro.

Some members intend to raise their concerns with Draghi at the governors' traditional informal working dinner on Wednesday before the ECB's formal monthly rate-setting meeting on Thursday, the sources interviewed by Reuters said.

"We do not expect further easing at Thursday’s ECB meeting but it may give more insight into its new asset purchase programs," strategists at Barclays said.

MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS was down about 0.1 percent in early trade, while Japan's Nikkei stock average .N225 gave up about 0.2 percent.

On Wall Street on Tuesday, the S&P 500 .SPX and Nasdaq Composite .IXIC ended lower after the big drop in oil prices, while the Dow Jones industrial average .DJI eked out a small gain, with energy shares under pressure from low oil prices.

U.S. data on Tuesday revealed a surprise widening of the trade deficit last month, which raised speculation that the initially reported 3.5 percent pace of third-quarter U.S. growth could be revised down. That in turn reduced the likelihood that the U.S. Federal Reserve would hike interest rates in 2015.

The Commerce Department said the trade deficit grew 7.6 percent to $43.03 billion, compared with a forecast of $40.00 billion among analysts polled by Reuters.

The data increased the safe-haven appeal of U.S. Treasury notes, pushing down the benchmark 10-year yield and weighing on the dollar. The yield stood at 2.335 percent in Asia, down from its U.S. close of 2.342 percent on Tuesday, when it fell as low as 2.303 percent.

The dollar index was flat on the day at 87.015 .DXY, after moving away from its four-year high of 87.406 touched on Monday.

The dollar was buying 113.60 yen, down slightly and well below a seven-year peak of 114.21 hit on Monday.

The euro edged up to $1.2550, moving off a two-year low of $1.2439 set on Monday and shrugging off downbeat data after the ECB news.

The European Commission on Tuesday downgraded its forecast for euro zone economic growth over the next few years, leading investors to raise bets the ECB might consider more action to stimulate the region's economy.

In commodities trading, U.S. crude futures CLc1 edged up about 0.1 percent to $77.28 after reaching the lowest intraday price since October 2011 on Tuesday, after the Saudi move.

(GNN,AIP,Reuters,ga)(Editing by Eric Meijer)

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Japan could offer unapproved Ebola drug under certain criteria: #government

#GNN - #Japan could offer an unapproved drug under certain circumstances to help treat the deadly Ebola virus even before the World Health Organization has decided to make a request for the drug, the country's top government spokesman said on Monday.

Chief Cabinet Secretary Yoshihide Suga told a news conference that Japan would cooperate with the WHO and was ready to make an international contribution.

"I am informed that medical professionals could make a request for T-705 in an emergency even before a decision by the WHO. In that case, we would like to respond under certain criteria," he said.

T-705 is the developmental code for the influenza drug favipiravir. Japan's Fujifilm Holdings Corp and U.S. partner MediVector are in talks with the U.S. Food and Drug Administration to submit an application to expand the use of favipiravir as a treatment for Ebola.

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The Ebola epidemic in West Africa has killed more than 1,000 people and prompted the WHO to declare an international health emergency.

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Dollar dips after Wall Street rally

#GNN - #TOKYO: The #dollar edged back against the yen in Asian trade Thursday after surging to a near four-month high in US trade in response to forecast-beating US economic growth data.

In early trade in Tokyo the greenback bought 102.78 yen, compared with 102.81 yen late in New York but still well up from the 102.11 yen earlier in Japan. It had surged to 103.09 yen on Wall Street  its strongest since early April after the Commerce Department said the US economy grew 4.0 percent in the second quarter, much more than the 3.0 percent predicted.

That was also a sharp rebound from the 2.1 percent contraction in the previous three months that was caused by a severe winter.

The euro bought $1.3396 in Tokyo midday trade, compared with $1.3395 in New York where it hit a new eight-month low of $1.3367.The single currency also fetched 137.68 yen on Thursday against 137.73 yen in US trade.

While the dollar was boosted by the growth data it retreated after the Federal Reserve said after its latest policy meeting that while the economy was strengthening, it was still concerned about the jobs market and would keep interest rates low for as long as needed.

The statement was "relatively dovish on the labour market, with the Fed keen to retain the message that rate hikes are some time away," National Australia Bank said in a note.

Investors seemed little concerned after talks between Argentina and the US hedge funds it has branded "vultures" failed to reach agreement Wednesday on a debt repayment, effectively pushing the country into default.(GNN)(AIP)(AFP)

#China shares lead Asia higher, dollar buoyed

#GNN - #Asian #stocks shrugged off a drop in Wall Street and hovered near three-year highs on Monday, with China taking the lead after data showed a robust jump in profits earned by industrial firms in the world's second-largest economy.

The dollar traded near six-months peaks against a basket of major currencies as the euro continued to sag.

Profits earned by Chinese industrial firms rose 17.9 percent in June to 588.08 billion yuan ($94.98 billion) from a year earlier, up sharply from an 8.9 percent rise in May, the National Bureau of Statistics said.

Recent data have reinforced market expectations that the Chinese economy is powering through its recent soft patch as the government uses targeted stimulus measures to support growth.

MSCI's broadest index of Asia-Pacific shares outside Japan was up 0.2 percent, close to a three-year high of 509.23 scaled on Friday.

China's CSI300 jumped 2.3 percent and the Hang Seng climbed 0.8 percent.

Tokyo's Nikkei, which hit a six-month closing high Friday, was up 0.5 percent.

Funds from Middle Eastern and Asian investors were trickling in again as the Muslim fasting month ends, helping to shore up regional stocks, said Soichiro Monji, chief strategist at Daiwa SB Investments in Tokyo.

"Geopolitical concerns remain as the conflict in the Ukraine does not look like it will end soon, but there is some relief spreading that the impact will be contained," he said.

The focus turned to whether this week's run of U.S. data would be strong enough to keep fuelling risk appetite.

Upcoming U.S. indicators include the Case-Shiller price index on Tuesday, second-quarter GDP due on Wednesday and non-farm payrolls on Friday.

Factory activity surveys for major Asian economies will also be released on Friday.

The euro traded little changed at $1.3432, within close reach of $1.3421 plumbed on Friday, its lowest since November 2013.

The euro took another hit on Friday when Germany's Ifo business climate index painted a gloomy picture of the economy.

It had already been under pressure from a range of factors including expectations of further easing by the European Central Bank and diverging interest rates seen favouring the U.S. over Europe.

"We should brace for the euro breaking below key support at 1.34, given diverging U.S. and European monetary policies. Dollar buying pressure is building as shown by the strength of the dollar index, which this week's data, if upbeat, could enhance further," said Junichi Ishikawa, market strategist at IG Securities in Tokyo.

The two-day Federal Reserve policy review ending on Wednesday was also in focus but expectations were for Chair Janet Yellen to deliver the usual dovish message.

The dollar index, a gauge of its strength against a basket of key currencies, stood little changed at 81.026 after striking a near six-month high of 81.804 on Friday.

The dollar fetched 101.81 yen, having lost a bit of momentum in the wake of a rise in U.S. Treasury yields after climbing to a two-week high of 101.94 on Friday.

While the attention of equity and currency markets has shifted towards major corporate earnings and macroeconomic trends, geopolitical issues remained a key factor in commodities such as oil.

Brent crude shed 0.4 percent to $107.96 a barrel but still retained a chunk of its gains from Friday, when it climbed more than $1 as fighting in Ukraine and deteriorating relations between Russia and the United States ignited new fears of supply disruptions. [O/R]

(Editing by Eric Meijer & Kim Coghill)

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Tokyo stocks open up 0.28 percent

(GNN) - TOKYO: Tokyo stocks opened 0.28 percent higher on Thursday after the blue-chip Dow index powered to a new record on Wall Street thanks to robust US company earnings.

The Nikkei 225 index gained 43.57 points to 15,422.87 at the start. The Dow Jones Industrial Average ended at a record high Wednesday as strong Intel earnings and a new IBM venture with Apple boosted the blue-chip index.

The 30-issue Dow jumped 0.45 percent to 17,138.20 while the broad-based S&P 500 gained 0.42 percent to 1,981.57.The dollar was firm after a US Federal Reserve report said economic activity continued to pick up steam across the world´s largest economy.

The greenback was changing hands at 101.64 yen in early Asian trade Thursday compared with 101.69 yen in New York Wednesday afternoon.

The euro bought $1.3527 and 137.49 yen against $1.3524 and 137.55 yen in US trade.

Asia shares extend losses after Wall St slip

(GNN) - HONG KONG: Asian markets sank Wednesday, following a negative lead from Wall Street, while China released data showing inflation eased slightly in June after hitting a four-month high in May.

There is also a nervousness that equities could be in line for a correction following a recent rally over the past few weeks.

Tokyo slipped 0.34 percent, Sydney shed 0.90 percent and Seoul was 0.44 percent lower, while Hong Kong lost 1.16 percent and Shanghai eased 0.18 percent.

Jakarta was closed for presidential elections.

US shares retreated on Tuesday for a second straight session after returning from the long, Independence Day weekend. The S&P 500 and Dow closed Thursday at record highs after a better-than-expected report on US jobs creation.

The Dow slipped 0.69 percent, the S&P 500 fell 0.70 percent and the Nasdaq tumbled 1.35 percent.

Some observers have predicted a pullback after the latest surge across global markets. Among them this week Nobel prizewinning economist Joseph Stiglitz said he was "very uncomfortable" with current prices.

There are also concerns that the Federal Reserve could accelerate its plan to raise interest rates next year in light of recent upbeat economic data out of Washington.

In China the National Bureau of Statistics said in a statement that inflation came in at 2.3 percent last month, down from 2.5 percent in May.

It is also slightly below 2.4 percent forecast by economists for Dow Jones Newswires and well short of the 3.5 percent annual target set by Beijing.

Traders will now be keeping a close eye on Thursday´s trade statistics and the release next week of April-June economic growth data, hoping for an improvement on the previous three months.

On currency markets the dollar´s advances against the yen last week have been all but eliminated.

In early Tokyo trade the greenback was quoted at 101.53 yen, against 101.57 yen in New York and well below the 102.11 level touched on Monday in Japan.

The euro bought $1.3615 and 138.26 yen compared with $1.3611 and 138.24Oil prices were mixed. US benchmark West Texas Intermediate for August delivery rose eight cents to $103.48 while Brent crude eased eight cents to $108.86.Gold fetched $1,319.57 an ounce at 0210 GMT compared with $1,322.43 late Tuesday. (GNN)(AFP)(AIP)

Japan put Italy to sword for 10th straight win

TOKYO: Japan´s forward line put in a dynamic performance as the Asian champions extended their record winning streak to 10 games with a nail-biting 26-23 victory over Italy on Saturday.

Male Sau´s bulldozing try on the hour mark ultimately proved the difference for Japan but the home side had to survive a nervous finish before recording their first win in six meetings with the Azzurri.

Japan struggled in the lineout but they punched above their weight in the scrum, while Italy coach Jacques Brunel slammed his butter-fingered players as the Six Nations side lost their ninth game in a row.

Japan are now set to break into the world´s top 10 for the first time, but Jones insisted all that mattered was next year´s World Cup.

Japan are drawn in Pool B at the World Cup in England, alongside South Africa, Scotland, Samoa and the United States. They disappointed at the 2011 World Cup under former All Black John Kirwan, beaten by hosts New Zealand, France and Tonga before drawing 23-23 with Canada.

Full-back Ayumu Goromaru kicked 16 points for the Japanese, who came into the game boosted by a 37-29 away victory over World Cup opponents the United States last weekend.

Akihito Yamada´s fifth-minute try gave Japan the early initiative until a penalty try awarded after the winger´s knock-on gave Italy a foothold, the first half ending 13-13.Italy´s resistance appeared to crack when Sau crashed over following sustained Japanese pressure in the 60th minute, but a breakaway try from Robert Barbieri made for a cliff-hanging final five minutes. (AFP)