Category: 3. Business

KARACHI:

The State Bank of Pakistan (SBP) raised Rs589.49 billion through latest auctions of Pakistan Investment Bonds (PIBs) and Market Treasury Bills (MTBs) on Wednesday, reflecting continued investor confidence in government securities despite evolving macroeconomic conditions.

The auctions attracted robust participation across both short- and long-term instruments. Of the total amount raised, Rs203.35 billion was mobilised through 10-year floating-rate PIBs, while Rs386.14 billion came from various tenors of MTBs ranging from one month to 12 months.

In the PIB auction, the SBP received bids totalling Rs539.2 billion (face value). It accepted Rs199.2 billion in competitive bids at a cut-off price of Rs94.8526, translating into a realised amount of Rs189.15 billion, along with accrued interest of Rs1.65 billion. Additionally, non-competitive bids worth Rs4.15 billion were accepted at a slightly higher price of Rs94.9541, bringing the total PIB acceptance to Rs203.35 billion.

The MTBs auction was equally well-received, with demand spread across four tenors. In competitive bidding, the SBP accepted Rs33.36 billion for one-month bills at a cut-off yield of 10.8999%, Rs50.16 billion for three-month bills at 10.8502%, Rs33.06 billion for six-month bills at 10.8739% and Rs65.18 billion for 12-month bills at 10.9999%. Weighted average yields across all tenors were slightly lower than the respective cut-off yields, indicating some price competitiveness.

The central bank also accepted Rs204.35 billion in non-competitive bids for MTBs, boosting total acceptance to Rs59.28 billion for one-month, Rs182.32 billion for three-month, Rs54.11 billion for six-month and Rs90.42 billion for 12-month tenors.

Moreover, after 10 straight sessions of gains, the Pakistani rupee slipped against the US dollar on Wednesday, recording a marginal depreciation of 0.04% in the inter-bank market. By the end of trading, the rupee stood at 282.67, down by 10 paisa from Tuesday’s close at 282.57.

Meanwhile, gold prices in Pakistan increased, defying the global trend where the precious metal saw a mild retreat as investors booked profits after a recent rally. In the local market, the price of gold per tola rose by Rs1,300, settling at Rs359,300, according to the All Pakistan Sarafa Gems and Jewellers Association. Similarly, the price of 10-gram gold climbed by Rs1,114 to Rs308,041.

Speaking to The Express Tribune, Interactive Commodities Director Adnan Agar said the local market remained tilted towards the upside. “Gold was on an upward trend. The day’s high was $3,385 and the low was $3,344, with the market later standing at $3,378,” he said.

Agar noted that if the market closed above the $3,375-3,380 range, there was a strong possibility that gold could test $3,440-3,450 levels in the near term.

Globally, spot gold fell 0.1% to $3,378.12 per ounce by 1202 pm ET (1602 GMT). However, US gold futures were up 0.1% at $3,436.90.

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Flash floods are causing havoc across swaths of Asia even as scientists said the global temperature rise in the past three months had eased from record levels.

The global temperature increase remained more than 1.5C above pre-industrial levels over a 12-month period even though July was the third month where the temperature rise was below that level, the European earth observation agency Copernicus said.

Scientists cautioned this did not mean “climate change has stopped”. Last month was still the third-warmest July on record at about 1.25C above the pre-industrial average.

“Two years after the hottest July on record, the recent streak of global temperature records is over — at least for now,” said Carlo Buontempo, director of Copernicus. “But that doesn’t mean climate change has stopped. We continue to witness the effects of a warming world in events such as extreme heat and catastrophic floods.”

Torrential rain forced businesses and schools to shut and disrupted travel in Hong Kong this week, as it experienced its highest daily rainfall for August since 1884, local weather authorities said.

At the same time, a rescue mission was under way for dozens of missing people in the northern Indian state of Uttarakhand following flash floods.

The floods come after the earth experienced its hottest year on the books in 2024, breaking a record that was set only a year earlier. A warmer atmosphere holds more moisture, making intense rainfall more likely.

The 12 months between August 2024 and July this year was 1.53C above the pre-industrial average, Copernicus said. A short-term temperature rise of more than 1.5C is not a breach of the long-term goals of the Paris agreement, which is measured over a period of two decades.

Scandinavia, China and Japan were particularly hot this July, Copernicus said.

Akshay Deoras, research scientist at the University of Reading, said that even if the recent streak of temperature records “eases temporarily, it does not mean extreme weather events are slowing down”.

While parts of Asia, including India, often experience intense monsoon rains between June and September, Deoras warned these “storms are now happening in a much warmer atmosphere — one that holds more moisture, builds more energy and releases it violently”. 

He pointed to Uttarakhand, which had received up to five times its normal rainfall between August 5 and 6.

A so-called cloudburst, or extreme sudden downpour, was blamed for the flooding in Dharali in Uttarakhand, with videos showing a wave of water knocking down buildings in its path. 

Indian Prime Minister Narendra Modi said “relief and rescue teams were engaged in every possible effort” to find and help victims.

Southern China was also hit with deadly flash floods last weekend, while an intense monsoon season has left hundreds of people dead in Pakistan. 

A rapid analysis by the World Weather Attribution global research group released this week found that the recent floods in Pakistan were made about 15 per cent more intense by human-caused climate change.

Rain in the monsoon months had become more intense, it found. “Every tenth of a degree of warming will lead to heavier monsoon rainfall, highlighting why a rapid transition from fossil fuels to renewable energy is so urgent,” said Mariam Zachariah, researcher at the Centre for Environmental Policy at Imperial College London.

United Airlines on Wednesday said it had suspended flights due to a widespread tech issue, and anticipates additional flight delays in the evening.

“Due to a technology issue, we are holding United mainline flights at their departure airports,” United said in a statement. “We expect additional flight delays this evening as we work through this issue. Safety is our top priority, and we’ll work with our customers to get them to their destinations.”

According to the Federal Aviation Administration’s website, ground stops had been issued for United Airlines flights at several US airports including its hubs in Chicago, Denver, Houston, Newark and San Francisco.

The ground stop does not affect United Express flights, and any flight already in the air will continue to its destination, the airline said.

As of Wednesday evening, tracking site FlightAware reported that United had delayed 28%, or 876, of that day’s flights.

As frustrated passengers took to social media, United apologized for the disruption and assured people their teams were “working to resolve the widespread system error as quickly as possible”.

United Airlines has halted flights at major airports across the US over a “technology issue”, according to the company.

A ground stop was issued for the company’s mainline flights from departure airports, causing issues at airports including Chicago, Denver, Houston, San Francisco and New Jersey, the US Federal Aviation Administration’s website shows.

“We expect additional flight delays this evening as we work through this issue,” United told the BBC’s US partner CBS News.

“Safety is our top priority, and we’ll work with our customers to get them to their destinations,” the company said.

The BBC has contacted United Airlines for comment.

Flights that are already in the air will continue to their destination, the company told CBS News. It added that regional flights were not impacted but could be delayed because of traffic jams from the ground stops.

Over 700 United flights had been delayed as of 21:00 EDT (2:00 BST), according to flight tracking site FlightAware.

KARACHI:

A study by the Lahore University of Management Sciences (LUMS) has called for urgent policy reforms to unlock the full potential of Pakistan’s gig and digital economy, using foodpanda as a case study. The report, titled “Economic Impact Assessment of foodpanda in Pakistan”, not only quantifies the platform’s substantial economic contribution – estimated at $1.2 billion for 2023-2024 – but also underscores the need for a more supportive regulatory environment.

The report highlights the platform’s expansive role in job creation, SME enablement, and digital inclusion through its network of over 50,000 registered riders and partnerships with 13,000+ restaurants, many of which operate in the informal sector.

While the findings underline foodpanda’s growing influence on Pakistan’s gig and digital economy, the study emphasises the urgent need for regulatory reforms to maintain and expand the impact of such platforms. LUMS recommends that the government preserve flexibility in labour laws to support gig and freelance workers who value autonomy and flexible hours. The study cautions that imposing rigid structures could reduce employment opportunities, particularly for youth and low-income groups.

The report also stresses that informal food vendors should not be excluded from the digital economy, urging the government instead to collaborate with food delivery platforms to gradually formalise these businesses without disrupting their operations or incomes.

Internet infrastructure was highlighted as another major concern. Since digital platforms rely on reliable and fast connectivity, service disruptions lead to order delays, customer dissatisfaction, and financial losses. The report urges the government to invest in broadband access, infrastructure upgrades, and incentives for private sector investment, especially in underserved areas.

LUMS also flagged concerns over the proposed Personal Data Protection Bill. Provisions for local data storage, strict consent rules, and cross-border data restrictions could raise costs for digital platforms that use global cloud services. The report warns these rules may deter global investors and hinder scalability.

The study also proposes a one-window licensing system for delivery riders. This would cover ID verification, vehicle checks, and licensing under one platform to streamline compliance, reduce administrative burdens, and enhance safety and accountability in the sector.

To support the wider e-commerce ecosystem, LUMS recommends reducing import tariffs on technology and providing targeted incentives to local digital startups.

The study found strong ripple effects across food, hospitality, manufacturing, transport, and retail. In FY 2023-24, foodpanda enabled Rs75 billion in restaurant revenue, created jobs, contributed Rs9.76 billion in taxes, and empowered 50,000+ riders and entrepreneurs through fintech.

In June 2025, Japan hosted the LNG Producer-Consumer Conference 2025 in Tokyo, bringing together representatives from 30 countries to address global energy stability. At the event, liquefied natural gas (LNG) was framed as a “driver of clean economic growth” in Asia, reaffirming Japan’s emphasis on regional fossil fuel development. 

However, Japan’s fossil-focused diplomacy stands at a crossroads. While it has long promoted LNG as the cornerstone of Asia’s economic stability, shifting global dynamics — such as China’s dominance in renewable energy supply chains and the growing uncertainty around the United States (U.S.) trade policy — call for strategic change.

Southeast Asia faces dual challenges: renewable manufacturing hubs are exposed to tariff shocks and supply chain disruptions, while countries urgently need renewables and grid infrastructure investment to meet economic and climate goals. As the region’s largest infrastructure investor, Japan is strategically positioned to accelerate, rather than delay, Southeast Asia’s clean energy transition.

By pivoting to support renewable energy deployment and manufacturing capacity in Southeast Asia, Japan can tackle fossil fuel dependence, reduce reliance on China-centric supply chains, and spur regional economic growth. Matching its LNG leadership with equally ambitious action on clean energy would cement Japan’s role as a driver of Southeast Asia’s sustainable future.

Japan’s fossil fuel-heavy investment profile in Southeast Asia

Japan’s energy investments in Southeast Asia heavily favor fossil fuels. Between 2013 and 2022, Japan’s public financial institutions – including the Japan Bank for International Cooperation (JBIC), the Japan International Cooperation Agency (JICA), and the Nippon Export and Investment Insurance (NEXI) – provided around USD41 billion for fossil fuel projects in Asia, nearly five times the USD9 billioninvested in clean energy such as wind and solar. By July 2024, Japanese companies supported over 30 LNG-related projects in the Asia-Pacific region.

Japan’s Asia Zero Emission Community (AZEC) initiative, launched in 2023, includes renewables in its framework but essentially emphasizes LNG, ammonia co-firing in coal plants, and carbon capture. While Japan labels these as “transition tools,” such investments risk locking the region into prolonged fossil fuel dependence. Since AZEC’s inception, the country has signed over 150 Memoranda of Understanding (MOUs), with 35% supporting fossil fuel technologies, while only 7% focus explicitly on wind and solar, according to data compiled by research firm Zero Carbon Analytics. 

Southeast Asia needs to increase annual clean energy investment to USD190 billion by 2035 and invest USD300 billion in grid development to meet climate goals. As part of AZEC’s Asia Energy Transition Initiative, Japan committed USD10 billion in blended public–private financing for the region’s energy transition. Yet much of this funding supports hydrogen, ammonia, and other technologies with limited immediate decarbonization impact, risking the perpetuation of regional fossil fuel dependence rather than enabling a true energy transition.

Why has Japan been reluctant to invest in renewables?

Japan’s hesitation to invest in renewable energy domestically and across Southeast Asia stems from structural and strategic factors.

First, Japanese policymakers believe that fossil fuels, particularly LNG, are crucial for the development of emerging Asian economies. At the LNG Producer-Consumer Conference 2025, Japan’s Minister of Economy, Trade and Industry described LNG as “a foundation of global stability and economic growth, especially in Asia”, emphasizing its role as a “realistic transition fuel” for sustainable development. He also highlighted LNG’s role in enabling industrial growth across Asia.

Second, Japan’s overseas fossil fuel investment strategy focuses on increasing its “fossil fuel self-development ratio”, which measures the share of imported oil and gas from Japanese-owned upstream assets. Despite declining domestic energy demand and climate concerns, Japan aims to raise this ratio from 37% in fiscal year (FY) 2023 to over 50% by 2030 and 60% by 2040. Between 2013 and 2023, Japanese public financial institutions invested USD93 billion in overseas oil and gas projects, with 45% dedicated specifically to upstream oil and gas development, against their commitment to end fossil-fuel financing by the end of 2022.

Third, the government has expressed concern regarding China’s dominance in renewable energy supply chains. China controls over 80% of solar photovoltaic (PV) manufacturing and contributes more than 60% of new global renewable capacity, while Japan’s PV share has fallen below 1%. Japan’s global market share in lithium-ion batteries declined from 40% in 2015 to 21% in 2020 for electric vehicle (EV) batteries, and from 27% to 5% for storage batteries. Chinese and Korean companies now lead both categories.

To avoid direct competition in China-dominated sectors, Japan focuses on developing emerging technologies — such as hydrogen, ammonia, carbon capture, utilization, and storage (CCUS), and e-methane — where it holds a competitive advantage. This strategic choice aims to establish a domestic, independent energy supply chain without deepening reliance on China.

U.S. trade disruptions and the Southeast Asian clean energy shock

Recent decisions by the U.S. to impose high tariffs on Asian economies — including increased duties on clean energy imports from the region introduced by previous administrations — have disrupted global supply chains and created significant uncertainty for Southeast Asian renewable energy exporters. 

The Institute for Energy Economics and Financial Analysis (IEEFA) has reported that although 88% of U.S. solar panel imports came from Southeast Asia in 2024, producers in countries such as Vietnam, Malaysia, and Thailand face margin compression, cancelled orders, and delayed investment decisions from foreign buyers. These disruptions weaken the region’s manufacturing base and reduce the economic viability of new capacity expansion, especially as companies reassess exposure to volatile export markets.

Simultaneously, LNG markets remain geopolitically volatile, adding a second layer of risk for Asian economies already dependent on energy imports. The resulting uncertainty undermines long-term energy planning for both importing and exporting countries in the region.

This convergence of shocks presents a unique opportunity for Japan. By pivoting its investment and industrial strategy to support renewable energy deployment and supply chain development in Southeast Asia, Japan could address three interconnected challenges: fossil fuel overreliance, regional supply insecurity, and geopolitical risks stemming from overdependence on China or the U.S.

To seize this opportunity, Japan should:

1. Create a renewable self-development ratio

Just as Japan tracks fossil fuel supply security through its self-development ratio, it should establish a similar metric for renewable energy. This would help incentivize upstream and midstream investment in Southeast Asian clean energy manufacturing.

2. Increase domestic renewables targets to anchor regional demand

Japan’s slow deployment of renewables weakens demand signals for its suppliers. Increasing its 2030 and 2040 renewables targets, alongside grid and market reforms, would create a stable domestic market for Southeast Asian-made panels, turbines, and batteries.

3. Champion global support for Southeast Asian renewable growth

Leveraging its influence at the Asian Development Bank and experience in regional development finance, Japan should lead efforts within international fora and financial institutions to mobilize funding and capacity-building for Southeast Asian clean energy manufacturing and infrastructure.

4. Reorient AZEC and power sector engagement toward renewables

Japan wields considerable influence over Southeast Asian power development plans through AZEC, bilateral dialogues, and infrastructure finance. This authority should be used to promote renewable-based systems, not further entrench fossil fuels or unproven technologies like co-firing ammonia in coal plants.

By Emily Bary

Trump vows to impose roughly 100% tariffs on semiconductors unless companies build in the U.S. Is it the latest installment of the ‘TACO’ trade?

Earlier this year, Nvidia pledged to make AI supercomputers in the U.S.

President Donald Trump threatened steep tariffs for the semiconductor industry if they don’t build in the U.S., but major chip stocks are largely shrugging off his latest comments.

Trump’s Wednesday remarks were somewhat vague, with Trump saying he “will be putting a tariff of approximately 100% on chips and semiconductors” but declining to provide details on when those rules would go into effect.

He also said there would be exceptions for companies “building” in the U.S., without going into detail about how much domestic manufacturing these companies actually have to be doing.

“If you’re building in the United States of America, there’s no charge,” he said. “Even though you’re building and you’re not producing yet in terms of the big numbers of jobs and all of the things that you’re building, if you’re building, there will be no charge.”

Trump made his comments alongside Apple Inc. (AAPL) Chief Executive Tim Cook, who pledged $100 billion more in U.S. investments on top of the $500 billion the company had previously committed over a multiyear span. As part of the latest round, Apple will spend $2.5 billion to manufacture cover glass for iPhones and watches at a Corning Inc. (GLW) facility in Kentucky.

See more: Apple’s stock gains as new announcement with Trump could help its tariff problem

While Trump got to hail the investment as a win for domestic iPhone production, analysts remain skeptical that the latest pledge will drive a dramatic change in Apple’s iPhone manufacturing process.

“The reality continues to be that producing iPhones in the U.S. is unrealistic given the cost structure vs. Asia/India and remains a fairy tale concept in our view,” Wedbush’s Daniel Ives wrote on Wednesday.

Meanwhile, Nvidia Corp. shares (NVDA) rose 0.6% in Wednesday’s extended session, while shares of Advanced Micro Devices Inc. (AMD) gained 1%. Marvell Technology Inc. stock (MRVL) was fractionally higher, while Broadcom Inc. (AVGO), and Qualcomm Inc. (QCOM) edged slightly lower.

Nvidia has already made a U.S. investment pledge, saying in April that it would domestically produce up to $500 billion of artificial-intelligence infrastructure, including AI supercomputers, over four years. While the company is still producing other products overseas, the pledge could land favorably with Trump and chip-sector investors may reason that other big companies will follow suit if they haven’t already made public commitments of their own.

Shares Texas Instruments Inc. (TXN) and GlobalFoundries Inc. (GFS), two chip companies with more established U.S. presences already, gained about 2% and 8%, respectively, while Intel Corp.’s stock (INTC) rose 0.7% in Wednesday’s after-hours action.

Investors may also see the latest commentary factoring into another installment of the “TACO” trade – an acronym for “Trump always chickens out.” The term captures a sentiment by some on Wall Street that Trump makes draconian threats but ultimately backs off.

-Emily Bary

This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.

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  08-06-25 2025ET
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