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Good morning. Heading to Japan for the G7 summit, British Prime Minister Rishi Sunak said he was considering following Washington’s lead by imposing new restrictions on local companies making investments in critical industries in China.
US President Joe Biden has drawn up a yet-to-be-announced plan to limit investment in key parts of the Chinese economy by US companies.
Sunak said any joint action on tighter controls on Western investment in China was still a work in progress and would not be agreed upon at the Hiroshima summit, as the US did not yet have a “fully formed view”. But the prime minister added: “In broad terms, absolutely, it will be something we will talk about.”
Placing further export controls on China will also be discussed by Western allies during the G7 meeting with “economic security” high on the agenda, Sunak said.
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UK-China relations: Rishi Sunak has backtracked on his promise to ban the Confucius Institute from operating in Britain, in the latest sign of the British prime minister trying to improve relations with Beijing.
Here’s what else I’m watching today:
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Biden meets Kishi: With US President Joe Biden arriving in Hiroshima for the G7 summit, he is expected to meet Prime Minister Fumio Kishida.
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China-Central Asia Summit: President Xi Jinping is hosting a two-day summit with the leaders of Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan and Uzbekistan.
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Earnings: Alibaba, BT Group, Burberry, easyJet, Investec, Premier Foods and Walmart are among the companies reporting results today.
Five more top stories
1. Aging populations are taking a toll on public finances around the world, as recent interest rate hikes increase the impact of higher pensions and health care costs, ratings agencies have warned. Moody’s, S&P and Fitch have all warned that worsening demographics are already hitting governments’ credit ratings with downgrades likely without sweeping reforms.
2. Taiwan’s largest opposition party has chosen Hou Yu-ih as its presidential candidate for elections in January. Hou, the popular mayor of the country’s largest municipality, said that while he opposes Taiwan independence, he also rejects rule by China under “one country, two systems”. Read more about the Mayor of New Taipei City.
3. Joe Biden was “confident” that the US could avoid an unprecedented debt default, as he prepared to head to Japan for the G7 summit on Wednesday. Biden also left the door open to comply with a Republican demand and add new work requirements to anti-poverty programs. Here are the latest details on the fiscal anomaly Biden plans to cut short his trip to Asia.
4. South Korea is trying to reduce technology leaks to China with three leaks of major technologies in the first quarter of 2023. The country’s government now has a database of chip engineers to monitor their journey and has also sought to make it easier to prosecute would-be leakers.
5. Japan has emerged from a technical recession on the back of a post-Covid recovery in household spending and tourism, sending shares to a new 33-year high in Asia’s most advanced economy. However, economists warned that the strength of Japan’s recovery was modest.
Great read
Dr Vershalee Shukla runs a cancer screening program in Scottsdale, Arizona © FT montage: Ian Bott/Caitlin O’Hara/FT
Investors are pouring billions into companies that claim they can analyze DNA to detect cancer early. The technology has been hailed as “revolutionary” and “cutting edge” by UK and US health chiefs, but some scientists question whether it actually works.
We also read. . .
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Fly high: Thomas Flohr aimed to upset the private jet industry. But after 19 years, the billions in debt held by his company VistaJet are causing concern.
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‘Defining Decade’: Rising commodity prices have helped Australia’s Labor Party balance the books, but the country will soon face a host of rising bills.
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Share Buybacks: Company buybacks of their own shares reached a world record $1.3 billion last year, but such schemes are no substitute for thoughtful investment in growth and decent pay for staff, writes Brooke Masters.
Graphic of the day
Global temperatures are likely to exceed 1.5C above pre-industrial levels for the first time in human history within the next five years, the World Meteorological Organization said in its latest annual assessment.
Take a break from the news
People have been anticipating the cultural renaissance of the cuddly island nation of Singapore for almost 15 years. Is it finally here?
Additional contributions by David Hindley and Gary Jones
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