Business at this week

China Signals Shift in Tech Policy with High-Profile Meeting

In a rare public display of engagement with the tech sector, China’s leader, Xi Jinping, met with some of the country’s most prominent entrepreneurs, marking a significant shift in the government's stance toward an industry it once heavily scrutinized. Xi was seen shaking hands with Alibaba’s founder, Jack Ma, who had previously moved to Japan after clashing with regulators. Also present were Liang Wenfeng, founder of AI company DeepSeek, as well as executives from Tencent, BYD, and CATL. Notably absent was Baidu’s chief executive, and the company’s share price took a hit after investors noticed the omission.

With China’s economy facing headwinds and competition with the U.S. intensifying, Xi’s renewed outreach to private enterprise signals a more business-friendly approach. This shift comes as Beijing seeks to regain investor confidence and revitalize innovation within the tech sector.

Meanwhile, South Korea has taken action against DeepSeek’s AI app, banning further downloads over concerns that it violates the country’s data privacy laws.

TikTok Back on U.S. App Stores

Apple and Google have reinstated TikTok on their U.S. app stores, ending a brief period of unavailability. The app was removed toward the end of the Biden administration due to national security concerns regarding its Chinese ownership. However, it remained accessible to existing users. The platform’s return follows an intervention by Donald Trump, who granted TikTok a temporary reprieve while negotiations over its ownership structure continue.

Microsoft Pushes Quantum Computing Forward

Microsoft has unveiled the Majorana 1 chip, a potential breakthrough in quantum computing. The company claims the chip could accelerate the development of quantum computers capable of solving “industrial-scale problems” within years rather than decades. The new technology is based on a novel material Microsoft calls a “topoconductor,” which belongs to the class of topological superconductors. According to the company, this material enables the creation of more stable and scalable qubits using Majorana fermions—exotic subatomic particles with unique quantum properties. Experts caution that further validation is needed to assess its real-world impact.

Trump’s Latest Trade Threats

Donald Trump has escalated his trade rhetoric, threatening to impose tariffs of at least 25% on all U.S. imports of cars, semiconductors, and pharmaceuticals. As with many of Trump’s trade policy statements, it remains unclear whether this is a definitive plan or a negotiation tactic aimed at securing lower tariffs on American exports. He has also proposed “reciprocal” tariffs to mirror those imposed by foreign governments on U.S. goods.

Inflation Surges in the UK

Britain’s inflation rate unexpectedly jumped to 3% in January, up from 2.5% in December, marking a ten-month high. Analysts attribute the rise in part to the introduction of value-added tax (VAT) on private-school fees, along with a smaller-than-expected decline in airfares. Core inflation, which excludes volatile food and energy prices, climbed to 3.7% from 3.2%. The Bank of England had previously warned of a possible uptick in inflation and remains cautious about cutting interest rates too soon.

Australia Cuts Interest Rates, Japan’s Economy Expands

Australia’s central bank has reduced its benchmark interest rate to 4.1%, marking its first cut since November 2020. The move follows a steady decline in the country’s inflation rate, which now stands at 2.4%, within the bank’s target range.

Meanwhile, Japan’s economy saw a strong rebound in late 2024, driven by a surge in business investment. GDP expanded at an annualized rate of 2.8% in the fourth quarter, suggesting a more robust recovery than previously anticipated.

London Stock Exchange Faces Another Setback

The London Stock Exchange (LSE) suffered another blow as Glencore’s chief executive, Gary Nagle, revealed that the commodities giant is considering delisting and moving to another exchange, possibly in New York. Glencore is one of the LSE’s most valuable companies. The potential departure comes after a challenging year for the LSE, with 88 companies either delisting or shifting their primary listings in 2023—the highest number since the 2007-09 financial crisis. Meanwhile, mining giant Rio Tinto has urged shareholders to reject a proposal to consolidate its shares in Australia and exit the London market.

Thames Water Secures Lifeline

Britain’s largest water utility, Thames Water, has secured High Court approval to borrow up to £3 billion ($3.8 billion) as it struggles to avoid insolvency. The company, which carries significant debt, also faces legal challenges from junior creditors. In a further twist, private-equity firm KKR has reportedly submitted a bid for a majority stake in the embattled firm.

KFC Moves Headquarters to Texas

KFC is relocating its headquarters from Louisville, Kentucky, to Plano, Texas, in a move orchestrated by its parent company, Yum Brands. The decision aligns KFC’s corporate offices with those of Pizza Hut, another Yum-owned fast-food chain. KFC, originally founded in Kentucky in the 1930s by Colonel Harland Sanders, has pledged to build a flagship restaurant in Louisville as a gesture to the state that gave it its name. Despite the sentimental attachment, the company’s leadership sees Texas as a more strategic base for future operations.