International business briefs: Moody’s cuts Afreximbank rating

Baidu launches AI video generator for businesses

Beijing — China’s Baidu on Wednesday launched an AI-driven video generator for businesses as well as a major upgrade to its search engine.

The image-to-video model, called MuseSteamer, is capable of generating videos up to 10 seconds long and comes in three versions — Turbo, Pro and Lite.

Over the past year, AI heavyweights such as OpenAI and big global tech companies have been expanding beyond chatbots to text-to-video or image-to-video generators. In China, ByteDance, Tencent and Alibaba have also launched models.

While many rival products, including OpenAI’s Sora, target consumers with subscription plans, Baidu’s MuseStreamer is aimed only at business users and a consumer app is not yet available. Reuters

Microsoft to cut about 4% of jobs amid hefty AI bets

Microsoft will lay off nearly 4% of its workforce, the company said on Wednesday, in the latest job cuts as the tech giant looks to rein in costs amid hefty investments in artificial intelligence (AI) infrastructure.

The company, which had about 228,000 employees worldwide as of June 2024, had announced layoffs in May, affecting about 6,000 workers. It was planning to cut thousands of jobs, particularly in sales, Bloomberg News reported last month.

The Windows maker had pledged $80bn in capital spending for its fiscal year 2025. Microsoft said on Wednesday it planned to reduce organisational layers with fewer managers and streamline its products, procedures and roles. Reuters

German plant and equipment makers grow orders

Berlin — German plant and equipment makers saw orders rise 9% in May from a year earlier on demand from other Eurozone countries, though the increase came against a particularly weak comparison base, engineering association VDMA said on Wednesday. Domestic orders increased 2% while foreign orders surged 12% compared with May 2024, mainly from the Eurozone, the association said in a statement. “May of the previous year was a particularly weak month for orders, so the comparison base was correspondingly low,” VDMA chief economist Johannes Gernandt said. Reuters

UK’s Spectris settles with takeover offer from KKR

Bengaluru — British scientific instruments maker Spectris has agreed to a takeover offer from US investment firm KKR valuing it at £4.7bn including debt, and has withdrawn its support for a rival offer from Advent.

The battle for Spectris, Britain’s largest takeover target this year, heated up after KKR last week tabled a bid valuing Spectris at £40 per share including dividends, 6.3% higher than Advent’s £37.63 per share offer, which valued the group at £4.4bn. 

Spectris said its board has decided to withdraw its recommendation of Advent’s offer in favour of the higher bid from KKR, which had made two previous takeover proposals for the London-listed firm. The firm had rejected KKR’s second takeover bid on June 13. Reuters

Volvo sales volumes slide on tariffs, weak demand

Stockholm — Sweden-based Volvo Cars reported on Wednesday a fourth straight month of falling sales volumes, pressured by trade tariffs and weaker electric vehicle demand.

Volvo Cars, which is majority-owned by China’s Geely, said in a statement it sold 62,858 cars in June, a 12% drop from a year earlier.

The group, which in April withdrew its earnings forecast for the next two years in the face of tariffs, said sales of fully electric cars fell 26% to account for 22% of total sales volumes. Reuters

Ruling allows Ferrari to retain Testarossa brand name

Amsterdam — Ferrari on Wednesday scored a win at the EU's second-highest court, which said the luxury sports car maker had been wrongfully stripped off the rights to the Testarossa brand name. Ferrari’s rights on the mark were revoked in 2023 by the EU’s Intellectual Property Office, which said the company had not put them to “genuine use” for a continuous period of five years in 2010-15.

But the EU’s General Court annulled that decision, stating that Ferrari had used the trade mark, through giving explicit or implied approval to dealers selling second-hand Testarossas and through licensing the brand for scale models.

“The use of the trademark to guarantee the identity of the origin of the goods for which it was registered, when reselling second-hand goods is capable of constituting genuine use,” the court said.

Its rights to the brand name had been challenged by the head of German toy maker Autec. Reuters

Moody’s cuts Afreximbank rating on high risks

London — Ratings agency Moody’s has slashed its rating on Afreximbank, the embattled African lender’s second downgrade in four weeks, citing weaker-than-expected asset performance and warning that its access to funding sources was shrinking.

Moody’s lowered the rating from Baa1 to Baa2 — two notches above a subinvestment grade or “junk” rating — and changed its outlook from negative to stable, according to a statement published late on Tuesday.

“The bank’s recent shift to unsecured lending to sovereigns under stress has introduced significant risks, diverging from its typical focus on trade finance, and heightened its sensitivity to its difficult operating environment,” Moody’s said. Reuters

Iran law suspending IAEA co-operation takes effect

Dubai — Iranian President Masoud Pezeshkian put into effect on Wednesday a law passed by parliament last week to suspend co-operation with the UN nuclear watchdog, the IAEA, Iranian state media reported.

Iran has threatened to halt co-operation with the IAEA, accusing it of siding with Western countries and providing a justification for Israel’s air strikes, which began a day after the IAEA board voted to declare Iran in violation of obligations under the Nuclear Non-Proliferation Treaty.

The law stipulates that any future inspection of Iran’s nuclear sites by the International Atomic Energy Agency needs approval by Tehran’s supreme national security council.

Separately, Iranian foreign minister Abbas Araghchi said in an interview with CBS News that the US bombing of Iran’s key Fordow nuclear site has “seriously and heavily damaged” the facility. Reuters 

Italian business lobbyist baulks at 10% tariff

Milan — Italy risks losing €20bn in exports and 118,000 jobs next year if the US imposes tariffs of 10% on all European products, the head of the main Italian business lobby said on Wednesday.

“Italy does not just export luxury products — with a demand that isn’t very sensitive to prices — but mainly machinery, means of transport, and leather goods,” Confindustria president Emanuele Orsini told daily Il Corriere della Sera in an interview.

Italian Prime Minister Giorgia Meloni recently downplayed the potential impact of such a level of tariffs on Italian companies, stating it would not be particularly harmful.

Orsini, however, warned that tariffs of 10% would be unsustainable for the Italian economy. Reuters

Polish Armaments Group to build 3 new factories

Warsaw — Four companies of the Polish Armaments Group (PGZ) will receive 2.4 billion zlotys ($664.80m) in financing from the state assets ministry for a project to build three ammunition factories, the ministry said on Wednesday.

Poland is leading a European push to boost its defence readiness to deter any possible attack from Russia and to be less dependent for security on the US.

The ammunition factories will include the manufacture of 155mm artillery shells, demand for which has soared since Russia’s full-scale invasion of Ukraine, and as European stocks have declined due to additional supply of shells to Kyiv.

Russia’s invasion of Ukraine, launched in February 2022, has heightened security concerns among neighbouring countries, prompting increased defence measures. The conflict has unsettled the region, leading nations like Finland and Sweden to seek Nato membership. Reuters

Kenya to list state assets in private investment bid

London — Kenya is earmarking state assets for initial public offering to bring in more private sector investment, President William Ruto said in remarks at the London Stock Exchange on Wednesday.

The government plans to start with listing the Kenya Pipeline Company via an initial public offering on the Nairobi Securities Exchange this year, Ruto said.

“We are committed to a structured, time-sensitive programme that identifies and prepares a robust pipeline of key government assets to be privatised through the stock exchange or improved through private sector participation,” he said.

Ruto also said that well-functioning domestic capital markets could reduce reliance on external debt. Reuters

US import tariffs averaging 21%, says Maersk

Copenhagen — Maersk estimates companies pay effective US import tariffs of on average 21% relative to container load, the Danish shipping group said on Wednesday, less than half the rate before Washington paused its sweeping tariffs in April.

Maersk said in a regular global market update that at its peak, shortly after April 2 when President Donald Trump unveiled tariffs against nearly all US trading partners, the average effective rate was 54%. Its estimate was based on the group’s container-weighted effective average tariff rate metric.

More than a dozen major US trading partners are rushing to reach agreements with the Trump administration by a July 9 deadline to avoid import tariffs jumping to higher levels. Reuters