FirstFT: US threatens China with anti-dumping measures

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Washington has warned Beijing that the US and its allies will take action if China tries to ease its industrial overcapacity problem by dumping goods on international markets, according to American officials.

Two senior Treasury officials told the Financial Times that a US delegation made its concerns clear in a recent visit to China, including in conversations with He Lifeng, the vice-premier responsible for China’s economy.

The US is most concerned about advanced manufacturing, and particularly clean energy sectors such as electric vehicles, solar panels and lithium-ion batteries.

“We are worried that Chinese industrial support policies and macro policies that are more focused on supply rather than thinking about where the demand will come from are both careening towards a situation where overcapacity in China . . . is going to wind up hitting world markets,” said Jay Shambaugh, the under-secretary for international affairs, who recently led an economic team to Beijing. Read the full interview with Shambaugh and deputy under-secretary for international finance Brent Neiman.

And here’s what else I’m keeping tabs on today:

• Israel-Hamas war: The UN’s top court in The Hague opens a week of hearings on the legal consequences of Israel’s occupation of Palestinian territories, with more than 50 states due to address the judges.

• Alexei Navalny: The widow of the Russian anti-corruption campaigner, Yulia Navalnaya, is to join a meeting of EU foreign ministers in Brussels. Russian officials have refused to tell Navalny’s family the probable cause of his death or the whereabouts of his body after it was announced he had died on Friday. Here’s the latest.

• Economic data: Brazil’s central bank releases results of a weekly economic survey with more than 100 financial institutions, including forecasts for GDP, interest rates and inflation rates.

• Markets: Financial markets in the US are closed for the Presidents’ Day holiday.

Five more top stories

1. Brussels is to impose its first ever fine on tech giant Apple for allegedly breaking EU law over access to its music streaming services, according to five people with direct knowledge of the long-running investigation. The fine is expected to be in the region of €500mn and announced early next month. This exclusive story has more on the EU’s plans.

2. Joe Biden has blamed Russia’s first major battlefield victory in Ukraine in nearly a year on the US Congress for failing to pass a bill funding Kyiv’s army. The Kremlin yesterday hailed the capture of Avdiivka, its first big victory since taking Bakhmut in May last year, after Ukraine’s forces withdrew on Saturday after being outgunned and outnumbered. Here’s more on the Biden-Zelenskyy call.

3. A senior banker has alleged that Morgan Stanley manufactured his job title to dupe European regulators into believing the bank had moved top staff to Frankfurt to comply with post-Brexit rules. The banker was made an executive director and formally named “head of loan trading” but was instructed early on not to actively use that title, which a superior told him “only existed on paper”. Olaf Storbeck has more details from Frankfurt.

4. Israel’s cabinet has rejected any “international diktats” to recognise a Palestinian state, unanimously voting yesterday to declare that any settlement would come “solely through direct negotiations between the parties, without preconditions”. The statement added that any recognition of Palestinian statehood in the wake of Hamas’s October 7 attacks on Israel “would give a huge reward to unprecedented terrorism”.

• Israel’s far right: Once seen as fringe extremists, a pair of religious Zionist ministers who live in settlements in the occupied West Bank now wield enormous influence.

5. Hundreds of thousands of Mexicans joined protests yesterday against a radical overhaul of institutions driven by populist President Andrés Manuel López Obrador, calling it a threat to democracy. Crowds wearing pink — the colour of the election authority’s logo — and waving national flags marched through Mexico City and other cities to reject the president’s vision. Here’s more on the protests ahead of June’s election.

The Big Read

To his advocates, Gary Gensler has been a fearless protector of investors and the markets since he became chair of the US Securities and Exchange Commission in 2021. Gensler has undertaken a sweeping reassessment of rules that have underpinned US markets for decades, just as the industry is adapting to new technologies, asset classes and market participants. But his reforms and tough stance on enforcement, with targets ranging from top investment banks to upstart crypto exchanges, have antagonised some on Wall Street.

We’re also reading . . . 

The FT has launched its new US Election Countdown newsletter. Join the FT’s Washington reporter Steff Chávez for your essential guide to the twists and turns of the most significant election for decades. Sign up here.

Chart of the day

The $200bn video games industry is reckoning with its biggest slowdown in three decades. Consumer spending on hardware is down and mobile gaming activity, a lucrative part of the industry in recent years, is slowing. The sense of crisis across the games sector that has resulted in job cuts and falling profits is in sharp contrast to the growth achieved during the Covid-19 pandemic. What next for the industry?

Take a break from the news

Well-paid professionals say they are feeling the pinch this year as less generous pay and bonus packages are eaten away by bigger mortgage repayments, higher taxes and rising living expenses. Two-thirds of the 2,675 respondents to the FT’s annual bonus survey expect their 2024 payout to be lower or about the same as last year, reflecting the gloomy outlook in the financial sector. Do you receive a bonus? If so, are you expecting it to be smaller than last year? Email firstft@ft.com to tell us about your bonus.

Additional contributions from Tee Zhuo and Benjamin Wilhelm