In today’s newsletter:
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Nato chief’s warning to Trump
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US hits China’s chip industry with new export controls
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Indian steelmaker JSW to launch EV brand
Good morning. We start with an exclusive interview with Nato’s new secretary-general Mark Rutte, who told the FT that the US would face a “dire threat” from China, Iran and North Korea if Ukraine were pushed to sign a peace deal on terms that were favourable to Moscow.
In his first interview as head of the western military alliance, Rutte discussed the points he made to Donald Trump at their meeting in Florida on November 22, as part of an effort to persuade the US president-elect to remain engaged with western allies and continue American support for Ukraine.
Rutte noted the risks from Russia supplying missile technology to North Korea and cash to Iran. In an apparent reference to Taiwan, he said that Chinese President Xi Jinping “might get thoughts about something else in the future if there is not a good deal [for Ukraine]”.
“We cannot have a situation where we have [North Korean leader] Kim Jong Un and the Russian leader and Xi Jinping and Iran high-fiving because we came to a deal which is not good for Ukraine — because long-term, that will be a dire security threat not only to Europe but also to the US,” Rutte told Brussels bureau chief Henry Foy. Here’s what else the Nato chief said in his pitch to Trump.
And here’s what else we’re keeping tabs on today:
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Economic data: South Korea publishes November inflation data.
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China-Iran ties: Chinese vice-premier Zhang Guoqing begins a two-day visit to Iran.
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Nato: A two-day foreign ministers’ meeting begins in Brussels.
Five more top stories
1. The US has introduced new export controls in an effort to limit China’s ability to create an advanced chip industry and to slow its development of artificial intelligence with military applications. US commerce secretary Gina Raimondo called the new rules “groundbreaking and sweeping”, though analysts said there was a “bizarre contradiction” at the heart of the new measures.
2. Indian steelmaker JSW plans to launch its own electric vehicles brand, its chair and family owner Sajjan Jindal has said. The move follows JSW’s announcement in March of a $1.5bn joint venture with SAIC Motor to build and sell the Chinese carmaker’s MG-brand EVs in India. Here’s more on JSW’s push into the country’s growing EV sector.
3. Fast Retailing shares fell yesterday after comments by its billionaire founder on cotton from the Xinjiang region set off a social media storm in China and raised concerns about boycotts of the Japanese group’s Uniqlo stores. In a BBC interview last week, Tadashi Yanai said Uniqlo did not use cotton sourced from the north-western region, where China has been accused of human rights abuses against the local Muslim Uyghur ethnic group, before declining to comment further as the issue was “too political”.
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More China news: Yields on China’s benchmark 10-year bonds slipped below 2 per cent yesterday, their lowest level in 22 years as investors bet on further monetary easing to help stimulate the economy.
4. A judge in Delaware yesterday rejected Tesla’s attempt to restore Elon Musk’s $56bn pay package after previously striking it down as a breach of the carmaker board’s fiduciary duty. Lawyers for the shareholder who brought the original suit were also awarded $345mn, instead of the $5.6bn in Tesla shares that they had requested. Read more about the decision.
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More tech news: Pat Gelsinger has abruptly stepped down as Intel chief executive, ending a nearly four-year run during which he failed to halt the Silicon Valley icon’s slide into turmoil.
5. A top Federal Reserve official has warned that the US central bank’s progress on curbing inflation “may be stalling”. Christopher Waller, a governor on the policy-setting Federal Open Market Committee, said he still supported a cut in interest rates later this month barring a surprise in the economic data.
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More US news: Joe Biden has pardoned his son Hunter Biden over convictions on gun and tax charges less than two months before the end of his presidency in an extraordinary reversal of his promise not to do so.
News in-depth
At a giant supply chain expo in Beijing last week, logistics company representatives said the number of customers seeking to front-load shipments to the US had increased following Donald Trump’s threat to impose new levies on goods from China, Canada and Mexico on his first day in office. “Clients are all saying that we need to rush to ship as much cargo as possible to the United States before Trump enters the White House on January 20,” said one representative of a China-based shipping line.
We’re also reading . . .
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Why Stellantis’ CEO was axed: Carlos Tavares refused to budge on his aggressive electric vehicle strategy as cries from suppliers, workers and government grew louder.
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Mother of all bubbles: America is over-owned, overvalued and overhyped to a degree never seen before, writes Ruchir Sharma.
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Tainted legacies: A failure to respond to Russian, Chinese and Syrian aggression during the Obama-Merkel era helped to create the unstable world of today, writes Gideon Rachman.
Chart of the day
The economic legacy of Joe Biden’s presidency is tied to the fate of two industrial initiatives: the Inflation Reduction Act and the Chips and Science Act. The policies have lured $400bn in clean tech and semiconductor manufacturing commitments while triggering an influx of foreign direct investment. But president-elect Donald Trump has vowed to dismantle significant parts of both laws, putting this legacy at risk.
Take a break from the news
Jared Bush took the role of chief creative officer at Disney Animation following a period of soul-searching at the world’s largest media company about the quality of its movies. Now he has scored a $386mn (and counting) hit with Moana 2, and told the FT his goal is to produce work that “will be around forever”. Read the full interview.
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