Microsoft on Tuesday said it will pump $1.7 billion into Indonesia over the next four years to build new cloud and AI infrastructure. The announcement came as CEO Satya Nadella met with Indonesian President Joko Widodo on the same day.

Microsoft said the funds will also go toward training 840,000 Indonesians in AI skills and supporting the local community of developers.

“This new generation of AI is reshaping how people live and work everywhere, including in Indonesia,” Nadella, chairman and CEO of Microsoft, said in a statement.

“The investments we are announcing today – spanning digital infrastructure, skilling, and support for developers – will help Indonesia thrive in this new era,” said Nadella.

Microsoft also said it will partner with governments, organizations and communities to provide AI skilling opportunities for 2.5 million people in Association of Southeast Asian Nations member states by 2025.

Nadella met with Jokowi in Jakarta on Tuesday to discuss topics including technological and AI breakthroughs that will help Indonesia progress, according to Indonesian news agency Antara.

Indonesia wants to become a developed country as set out in its Golden Indonesia 2045 Vision, which aims to make the country into a global economic powerhouse by 2045.

Microsoft’s investment will allow it to capitalize on the increasing demand for cloud computing services in Indonesia, as well as enabling the nation to capture economic and productivity opportunities arising from AI, the tech giant said.

Coordinating Minister for Human Development and Culture Muhadjir Effendy in January said that Indonesia faces huge challenges in leveling up its workforce to compete in a technological and globalized era.

Indonesia has a growing, young and tech-savvy population with Generation Z – those born between 1997 and 2012 – making up nearly 28% of the population, or 75.49 million people. The number of millennials, those born between 1981 and 1996, reached 69.9 million people, or 25.9% of the population.

Microsoft opened its first data center region in Indonesia in 2021 to meet customer needs for data to be stored in the country.

The European Union will need to levy higher-than-expected tariffs of up to 55% on Chinese electric vehicles to curb their imports into the bloc, according to a new analysis by Rhodium Group. 

The findings, released Monday, come amid the EU’s ongoing anti-subsidy investigation into EV imports from China.  

Rhodium Group, which expects the EU to impose tariffs in the 15% to 30% range on Chinese EVs, said those tariffs were unlikely to be enough to check competition from China. 

“Even if the duties come in at the higher end of this range, some China-based producers will still be able to generate comfortable profit margins on the cars they export to Europe because of the substantial cost advantages they enjoy,” the report said. 

Chinese companies such as BYD, which toppled Tesla to become the world’s largest EV manufacturer last year, can sell cars at much higher rates and profit margins in regions such as the EU compared with the domestic market, despite paying a 10% tariff rate. Chinese EV makers are locked in an intense price war in their home market.

BYD’s Seal U model, which sells for 20,500 euros in China and 42,000 euros in the EU, generates an estimated profit of 1,300 euros in its home market versus 14,300 euros per car in Europe, Rhodium said. Even after 30% in tariffs, a company like BYD will make a higher profit in the EU, it added.

The report said that BYD will likely need to cut prices to meet its goals of gaining more market share in the EU. A 30% tariff rate would still leave enough room to do so.

“Much steeper duties of around 45%, or even 55% for fiercely competitive producers like BYD, would probably be necessary in order to render exports to the European market unappealing on commercial grounds,” the report said. 

The European Commission, the executive arm of the EU, launched a probe into Chinese EVs and subsidies last year, with officials saying that a flood of cheap vehicles threatened domestic producers.

According to some experts, incentives put in place in China in the early 2010s led to a surge in startups and increased battery cell capacity in the country, paving the way for globally competitive and affordable EVs. 

Chinese EV makers have already been facing resistance from the U.S. amid high tariffs and political opposition, making the European market more important to companies such as BYD that are pursuing global expansion. 

EVs from Chinese companies are expected to make up 11% of the EU’s market in 2024 and could reach 20% by 2027, according to an analysis by the European Federation for Transport and Environment. 

When accounting for made-in-China vehicles from non-Chinese-companies, the figure is expected to surpass 25% this year. 

Imports of EVs from non-Chinese firms could also come under in the EU subsidy investigation, with Rhodium estimating that duties at the 15%-30% level could wipe out the business for foreign players such BMW or Tesla that ship cars from China.  

In response to the policy risks, EV makers have been working on shifting manufacturing to Europe. BYD plans to build a factory in Hungary. 

However, Rhodium adds that Brussels could use other means to protect the Europe’s EV industry, such as restricting Chinese imports on national security grounds or increasing consumer subsidies for EU-made vehicles.

The Chinese government has slammed the EU subsidy investigation as “blatant protectionism,” arguing that its companies are simply more competitive than their Western counterparts.

Samsung Electronics on Tuesday said operating profit for the first quarter jumped 932.8% as memory chip prices rebounded on the back of AI optimism.

Here are Samsung’s first-quarter results versus LSEG estimates:

• Revenue: 71.92 trillion Korean won (about $52.3 billion), vs. 71.04 trillion Korean won
• Operating profit: 6.61 trillion Korean won, vs. 5.94 trillion Korean won

Samsung’s revenue for the quarter ending March jumped 12.81% from a year ago, while operating profit soared 932.8% in the same period.

The figures were in line with the company’s guidance earlier this month, where Samsung said operating profit in the January-March quarter likely rose to 6.6 trillion Korean won, up 931% from a year ago. The firm expected first quarter revenue at 71 trillion won.

The South Korean electronics giant saw record losses in 2023 as the industry reeled from a post-Covid slump in demand.

“The company posted KRW 71.92 trillion in consolidated revenue on the back of strong sales of flagship Galaxy S24 smartphones and higher prices for memory semiconductors. Operating profit increased to KRW 6.61 trillion as the Memory Business returned to profit by addressing demand for high value-added products,” Samsung Electronics said in a statement on Tuesday.

Samsung is the world’s largest manufacturer of dynamic random-access memory chips (DRAM), which are commonly found in a wide range of consumer devices including smartphones and computers.

“We assume the earnings surprise was driven by higher memory price hike on AI-driven strong upturn cycle. We anticipate the company will guide for positive memory market outlook and emphasize its readiness in AI era including HBM (12H HBM3E, HBM4) and foundry/packaging solution,” said SK Kim of Daiwa Capital Markets in emailed comments to CNBC on Monday, ahead of the earnings release.

As AI models become more complex and datasets become larger, these models need memory chips with higher capacities and faster speeds to cater to these workloads.

Kim said in an April 5 report he expects another price hike on memory chips to drive Samsung’s second-quarter earnings on the back of an AI boom and the earthquake in Taiwan.

“Especially, we expect more upside in prices resulting from the earthquake in Taiwan,” said Kim, adding that the earthquake in early April temporarily impacted TSMC‘s and Micron‘s production.

Citi analysts said they see upside for Samsung’s NAND flash memory business as a result of AI computing demand. In a note on April 5, they reiterated their “buy” rating on the firm with a target price of 120,000 won — a 56% upside from the closing price of 76,700 won on Monday.

NAND is another staple memory chip alongside DRAM.

“We expect storage (HDD) to be the next bottleneck in AI computing, especially in AI training, and foresee Samsung Electronics to be one of the key beneficiaries of SSD demand momentum for AI training,” said the Citi analysts.

Earlier this month, the Biden administration agreed to grant Samsung up to $6.4 billion of funding to create new manufacturing capacity to produce chips in Texas. Micron and TSMC are also poised to receive grants to boost chipmaking in the U.S. after decades of chip production moving to Asia.

Samsung and TSMC are set to face competition from Japan’s Rapidus Corporation, which was recently granted $3.89 billion in additional subsidies from the Japanese government to mass produce 2-nanometer chips from 2027.

There are rising concerns that Samsung Electronics risks losing its leading position to rivals like SK Hynix, the world’s no. 2 memory chip maker.

SK Hynix on March 19 said it became the first in the industry to mass produce HBM3E, the next-generation of high bandwidth memory chips used in AI chipsets. SK Hynix is the primary supplier of HBM3 chips to Nvidia’s AI chipsets.

Mehdi Hosseini, senior tech hardware analyst of Susquehanna International Group, pointed out in early April that Samsung used to be the market leader in memory, smartphones and display innovations.

Now, Samsung is only “benefiting from the cycle recovery,” he added.

In the first quarter, Samsung managed to regain the top spot in smartphone shipments after losing the crown to Apple in 2023, according to International Data Corp.