The US and Japan have been conducting war games and joint military exercises in the event of a conflict with China over Taiwan, amid escalating concerns over the Chinese military’s assertive activity.
US and Japanese military officials began serious planning for a possible conflict in the final year of the Trump administration, according to six people who requested anonymity. The activity includes top-secret tabletop war games and joint exercises in the South China and East China seas.
Shinzo Abe, then Japanese prime minister, in 2019 decided to significantly expand military planning because of the Chinese threat to Taiwan and the Senkaku Islands in the East China Sea. This work has continued under the administrations of Joe Biden and Japanese prime minister Yoshihide Suga, according to three of the people with knowledge of the matter.
More US defence news: Donald Rumsfeld, a two-time US defence secretary and architect of the 2003 US invasion of Iraq, has died at the age of 88, his family said on Wednesday.
Five stories in the news
1. Financial services sector set for carve-out from G7 tax deal The UK is poised to secure an exemption for financial services from new global rules on taxing multinationals, in a move that would ensure the City of London’s largest banks do not pay more tax on their profits in other countries.
2. Deutsche Bank Hong Kong IPO licence to expire The German lender will be unable to sponsor initial public offerings in Hong Kong from July after it failed to replace two regulated staff on time, disrupting the company’s plans to relaunch its Asia equities business.
3. Economists predict at least two US interest rate rises by end of 2023 Elevated inflation will compel the Federal Reserve to raise US interest rates at least twice by the end of 2023, according to a new poll of leading academic economists for the Financial Times.
4. Record high tech M&A in south-east Asia Technology sector dealmaking in south-east Asia hit $19bn in the first six months of 2021, the strongest-ever start to a year, fuelled by acquisitions by leading groups Grab, Gojek and Sea. Subscribe to our Due Diligence newsletter for the latest news on global deals.
Elsewhere in dealmaking: the chief executive of Citizens Financial, which recently bought HSBC’s US retail banking business, has predicted there will be more opportunities for mergers and acquisitions as smaller banks struggle to keep up in the financial technology race.
5. Robinhood ordered to pay $70m penalty to US regulator The Financial Industry Regulatory Authority has ordered the retail trading platform Robinhood to pay more than $70m in penalties for causing what it described as “widespread and significant” harm to its customers.
Coronavirus digest
Kim Jong Un, the leader of North Korea, has warned of a “grave incident” linked to the pandemic, stoking fears of an outbreak in the isolated country.
Opponents of Jair Bolsonaro have seized on an unfolding scandal in Brazil over the procurement of coronavirus vaccines to turn up the political heat on the rightwing president.
Southern European countries are in the unenviable position of having to restrict foreign tourism or risk the rapid spread of the Delta variant.
For the latest coronavirus news, follow our live blog and sign up for our Coronavirus Business Update newsletter.
The day ahead
Chinese Communist party centenary China’s economic transformation over the past four decades is the landmark achievement of the Chinese Communist party, which celebrates its 100th anniversary today. President Xi Jinping is set to issue a keynote address in Tiananmen Square. Our editorial board writes that under Xi, China has morphed into an uncompromising authoritarian regime. (FT, SCMP)
An unintended consequence of the party’s stoking of enthusiasm for the centenary: a booming black market for anniversary souvenirs.
Opec meeting The oil cartel will meet today to decide whether to increase supply. Even with oil prices at record highs, producers have held off on opening the taps. Tuesday’s edition of Energy Source explains why. Subscribe to the newsletter here.
Bidens visits site of collapsed Miami condo US president Joe Biden and first lady Jill Biden will visit the partially collapsed Champlain Towers South condominium in Surfside, Florida, on Thursday. The official death toll rose to 16 yesterday with more than 140 people still missing. Here is a look at the apartment locations of those missing and those confirmed dead. (NPR, NYT)
What else we’re reading
Amazon’s changing of the guard With founder Jeff Bezos just days away from stepping down, whether Amazon can survive without him remains a pressing concern. But news of his departure has not moved the company’s stock price or dented its $1.7tn market value, perhaps because of investors’ trust in the corporate machine Bezos built — and in his replacement, Andy Jassy.
Amazon in the news: The ecommerce giant is seeking to force Lina Khan, the new chair of the US Federal Trade Commission, to recuse herself from any investigations involving Amazon, citing her previous work and criticism of the company.
How Brexit reshaped British politics Five years after the referendum and six months after the UK left the EU single market, the “earthquake” is still being felt. “It has made Britain more divided and considerably more angry,” said one pollster. Sign up to our weekly Brexit Briefing email for regular updates on post-Brexit Britain.
Bitcoin’s limits What’s the point of making a killing if you can’t spend the loot? Customers of Binance, one of the world’s largest cryptocurrency exchanges, are confronting that question after their accounts were cut off from one of the UK’s main payments systems. Plus, Madison Darbyshire explains the protections consumers have in crypto trading. The short answer: not many.
Related read: cryptocurrency investors and digital collectors have deemed the original source code for the web more valuable than the first tweet but less desirable than a pixelated punk. A “non-fungible token” representing Sir Tim Berners-Lee’s invention of the web sold for $5.4m at auction on Wednesday.
The search for E.T. has lessons for us all Even if we never find any extraterrestrial life, the search for it helps to foster a debate about what it is that enables humans to communicate with other “alien” humans, across time and space on our own planet, writes Gillian Tett. Right now, that is badly needed — with or without any UFOs.
Fighting for the right to party in the park Lockdown has raised the thorny question of who can access public spaces. In both London’s Primrose Hill and New York’s Washington Square Park there have been clashes between police, revellers and residents as young people claim the right to congregate, and those who live nearby complain of drug-dealing, late night noise and violence, writes Caroline Binham.
Travel
After “the worst year for property sales in a decade”, the Greek island of Mykonos is getting back to the business of hedonism. DJs have returned to the bars, umbrellas are back on the beaches and the serpentine, whitewashed alleyways of the old port are again thrumming with tourists.
Source: Economy - ft.com
