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Russia has offered to stop deployment of a controversial missile system in an attempt to restart talks on arms control in Europe following the collapse of a cold war moratorium, in the latest outreach by the Kremlin that could de-escalate military tensions. Donald Trump’s administration withdrew from the 1987 Intermediate-Range Nuclear Forces (INF) Treaty last year citing Russian violations, ending the US-Russia pact that banned land-based missiles with ranges of between 500km and 5,500km that was drawn up to end an arms race in Europe. The Kremlin said in a statement on Monday that it was prepared to end deployment of the 9M729 missile in its western regions. Washington justified its withdrawal from the INF Treaty on claims that the missile was in breach. The proposal comes just a few days after Russian president Vladimir Putin used an annual foreign policy speech to both warn against the threat of a new arms race and signal his hope that Washington and Moscow will restart talks on arms control and other issues after the US election next month.  Nato has rejected previous proposals from Moscow to freeze deployment of the missiles, demanding that Russia instead destroy them. Some missiles are already deployed in Kaliningrad, the Russian exclave on the Baltic Sea that borders Poland and Lithuania. Claudia Major, a defence analyst at the German Institute for International and Security Affairs, said the plan seemed similar to the proposal floated by Russia last year — and rejected by Nato as “not a credible offer”, because Moscow had already deployed the missile system. “Russia has the missile, and has fielded it, in breach of the INF treaty,” said Ms Major. “Nato countries don’t have them in Europe.” Nato has been approached for comment.  The Kremlin said in a statement: “While remaining committed to our consistent position on the 9M729 missile’s full compliance with the former INF Treaty, the Russian Federation stands ready, as a gesture of goodwill, not to deploy 9M729 missiles in the European part of the country, but only provided that Nato countries take reciprocal steps.” Alongside that, it suggested opening talks on potential bilateral inspections of the US Aegis Ashore missile system in Europe, and 9M729 missiles in Kaliningrad. “We propose all interested sides to consider concrete options for mutual verification measures to remove existing concerns,” it added. Kremlin spokesman Dmitry Peskov later told reporters it was a “new initiative” aimed at “multipronged de-escalation”. The proposal is the latest offer by Moscow to western capitals aimed at halting a steady erosion in arms control agreements. Mr Putin this month offered the US a one-year extension to New Start, another bilateral treaty governing the number of nuclear warheads held by both countries, which expires in February. That offer was rejected by the US, but a subsequent re-offer from Moscow last week to freeze all atomic warhead numbers prompted Washington to restart talks. New Start and INF were the two foundations of the post cold war arms control architecture between Russia and the US, and together were viewed as critically important for European security and to reduce the threat of a renewed arms race. “We consider the US withdrawal from the INF Treaty . . . a serious mistake, which increases the risks of unleashing a missile arms race, an increase in confrontational potential and a slide into uncontrolled escalation,” the Kremlin said in its statement. “Given the unrelenting tension along the Russia-Nato line, new threats to European security are evident.” The US first accused Russia of breaching the INF Treaty seven years ago and withdrew from the pact in August last year after Russia refused to destroy the 9M729 system. Moscow denies that the missile is in breach of the INF’s terms and that it could hit European capitals from western Russia. In addition to the alleged Russian violations, the Trump administration has also said that the pacts were outdated without the participation of China, whose missile potential has grown significantly in recent decades. Two weeks after formally withdrawing from the INF Treaty the US tested a ground-based cruise missile with a range over 500km. Additional reporting by Michael Peel in Brussels
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Ant Group is set to raise more than $34bn after setting the price of shares in its initial public offering, putting the Chinese payments group on track to top Saudi Aramco as the biggest ever market listing. The financial technology company, controlled by Alibaba’s billionaire founder Jack Ma, will sell shares in a dual listing across Shanghai and Hong Kong. It is expected to make its market debut on November 5. Ant said it would sell shares for the Shanghai portion, which will trade on the technology-focused Star market, at Rmb68.80 ($10.26) each, according to documents published by the city’s stock exchange on Monday evening. Ant also said it had set the price for its Hong Kong shares at HK$80 (US$10.32). Together the sale of the roughly 3.34bn shares, which account for 11 per cent of Ant’s total outstanding stock, will fetch $34.4bn. The Shanghai segment alone will bring in Rmb114.9bn ($17.2bn) or more than double the Rmb53bn raised by chipmaker SMIC in July. The pricings for both share offerings value Ant at about $313bn, roughly on equal footing with Wall Street bank JPMorgan Chase. The Chinese company’s valuation could rise to almost $320bn if underwriters on both portions exercise an option to sell additional shares that could bring total funds raised to $39.6bn. “It’s been a good year for IPOs [in Asia] but this one is hard to miss and I think everyone feels it’s going to do well in the after-market,” said Philippe Espinasse, a Hong Kong-based investment banking consultant, referring to Ant’s potential share price performance after it begins trading. Ant’s shares will be split evenly between Hong Kong and Shanghai. The share prices of companies that trade on both exchanges frequently diverge, with those in Shanghai often attracting higher valuations. China’s CSI 300 of Shanghai and Shenzhen-listed stocks has rallied about 15 per cent in 2020, outperforming most big global benchmarks, on investor optimism over the country’s economic recovery from coronavirus. Hong Kong’s Hang Seng is down 12 per cent. Chinese tech groups, including NetEase and JD.com, have raised billions of dollars via secondary share offerings in Hong Kong this year against a backdrop of rising tensions between Beijing and Washington. The Trump administration has proposed legislation that could force Chinese companies to delist from US markets if they refuse to provide American regulators with access to their audit reports.
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The writer is president of Queens’ College, University of Cambridge, and adviser to Allianz and Gramercy There has been a stark shift in global economic thinking on austerity. That was strikingly evident at the annual meetings of the IMF and World Bank earlier this month. In sharp contrast to what the IMF and others urged after the 2008 global financial crisis, senior figures at the meetings encouraged governments “to spend their way out of the pandemic”. The world is now set to experience another surge in debt and deficits from levels that only nine months ago would have been deemed unthinkable by most economists and financial market participants. Many in markets may be tempted to see this as unambiguous good news, heralding a period in which fiscal policy would reliably and repeatedly join monetary policy in flooding the system with liquidity and pushing asset prices higher around the world. The impact, however, is likely to be a lot more nuanced — dominated by pronounced dispersion in risk-return outlooks for companies and countries as opposed to another significant “melt up” of stocks, emerging markets and corporate bonds. The change in thinking on austerity reflects a revisit of what’s both desirable and feasible. It is almost universally acknowledged that governments should go out of their way to avoid “scarring”, where short-term problems become structurally embedded in the economy. A fiscal bridge over a damaged economic landscape owing to Covid-19 is seen as critical to avoid viable companies experiencing a cash crunch becoming bankruptcies, and furloughs turning into long-term joblessness. This approach is more feasible now that interest rates are extremely low and central banks readily buy what was, not so long ago, an inconceivable amount of government and corporate bonds. It is tempting to see this as unambiguously good for financial asset prices that have been long-supported by loose monetary policy. Indeed, it may seem even better as large deficits not only flood the system with funds financed by central banks but also involve outright grants and other forms of highly concessional income support to households. The notion of generalised support for the markets needs to be heavily qualified, however. As we continue to live with Covid-19, we should expect government support gradually to shift from a universal approach to one that is more selective: people over companies, viable sectors over permanently damaged ones and more partial income replacement for households. The result will be a growing distinction between favoured stocks and bonds over orphaned ones. The former includes several healthcare, technology and green economy names. The latter is heavy on hospitality and other elements of the services sector; these face a significantly higher risk in bankruptcies and weakening of contractual debt terms. Countries will also differ in their ability to sustain large deficit spending. What is not a problem for the US will be a headache for many developing countries that, as their debt and debt service obligations rise rapidly, find it harder to fund themselves through capital markets. With their growth models and foreign exchange also challenged, they will turn more to the IMF and other sources of official funding. The only real question is whether the reschedulings that follow for some are pre-emptive and orderly or, instead, involve a prior payments default. This greater dispersion in market winners and losers will come at a time when investors face difficulties in finding what they believe are reliable risk mitigators. With yields suppressed to very low — if not negative — levels by central bank market interventions, government bonds risk a price fall as markets react to ever-increasing debt and, hopefully, a brighter growth outlook down the road. This is particularly the case for longer-dated maturities, unless central banks cross what could well be a Rubicon in financial market distortions by opting for explicit yield targeting for maturities that are well beyond the reach of their benchmark policy rate. The old days of all-powerful bond vigilantes may indeed be over, at least for now. But this does not mean that further well-intentioned — indeed, necessary — surges in debt and deficits is unambiguously good for markets. From a return perspective, it’s only likely to support specific sectors and companies, and in a subset of countries around the world. Elsewhere, it is likely to be insufficient to avoid the bankruptcies and debt reschedulings that accompany a global recovery that is too small, too uneven, and too uncertain.
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Load new posts Total Covid-19 cases View charts and maps World Confirmed 42,632,275 Deaths 1,142,033 Updated at 10/25/2020, 5:26:48 PM BST 10/26/2020, 12:41:14 AM Cluster found in Uighur region sparks testing drive Christian Shepherd in Beijing A cluster of asymptomatic coronavirus cases in Kashgar, a city near China’s central Asian borders, has sparked a testing drive and strict restrictions on movement in one of China’s most heavily monitored regions. Local authorities launched extensive contact tracing and testing after a 17-year-old tested positive for Covid-19 in a routine test. Another 137 infections, all without symptoms, were discovered on Sunday, each linked to a clothing factory in Shufu district where the teenager and her parents work, local health officials said on Sunday evening. Authorities cancelled flights, trains and closed some roads while tests were conducted in the city, a historically important hub of Uighur culture and architecture that has been extensively rebuilt for tourists in recent years. Visiting travellers need to test negative before leaving, officials said on Sunday evening. A Chinese health worker conducts a swab test in Urumqi, Xinjiang The measures follow an early lockdown in July that brought much of Xinjiang to a standstill after hundreds of cases were found in Urumqi, the region’s capital. That outbreak was met with more extreme measures than those adopted in other regions of the country. Residents skirted censors to raise alarm on social media about being locked in their homes and forced to take daily doses of medicines. In recent years, Xinjiang has been turned into a security state with ubiquitous surveillance and heavy-handed policing. More than 1m Uighurs, Kazakhs and other Muslim-majority peoples have been interned in camps. Uighurs living outside China have raised alarm over the possibility of coronavirus spreading through detention facilities with cramped and often unsanitary living conditions. Share on Twitter (opens new window) Share on Facebook (opens new window) Share on LinkedIn (opens new window) 10/26/2020, 12:18:07 AM US state governors grapple with virus surge Patrick Temple-West in New York US healthcare workers fear surging Covid-19 cases could overwhelm hospitals as governors scrambled on Sunday to address record rises in new infections across the country. New York governor Andrew Cuomo on Sunday said the state was developing a new strategy to find “micro-clusters” of Covid-19 infections. Testing must get more local, he said, pointing to a birthday party at a restaurant on suburban Long Island that turned into 37 cases. On Sunday, Texas governor Greg Abbott asked for federal permission to use an army hospital to house people sick with non-Covid ailments as hospitals in the El Paso area have seen coronavirus cases surge. Read more here Share on Twitter (opens new window) Share on Facebook (opens new window) Share on LinkedIn (opens new window) 10/26/2020, 12:00:10 AM Melbourne restrictions stay after brief hope of relief The Australian state of Victoria recorded no new cases on Monday – for the first time since June 9 – as renewed clusters appeared to be under control. However, the capital city of Melbourne has not been allowed to emerge as expected from strict restrictions. Melbourne residents hoping for relief from a three-month lockdown were disappointed on Sunday after Victoria's state government said it would pause the expected lifting of restrictions. “I know plenty of people were looking forward to some good news today. And soon, very soon, we’ll have some,” premier Daniel Andrews said in a statement. https://twitter.com/VicGovDHHS/status/1319766615177760768 “But for now, we need to do again what we’ve done throughout this pandemic: follow the advice of our public health experts. That means there can be no changes to restrictions in Melbourne today.” On Sunday, Victoria recorded six new cases in Melbourne's northern suburbs, making a total of 39 cases in 11 households in what health officials fear is a previously unknown cluster. “Concerningly, while these cases have locations in common it is not yet clear how they link together,” Mr Andrews said. “It means we may still have transmission happening where we can’t see it.” Share on Twitter (opens new window) Share on Facebook (opens new window) Share on LinkedIn (opens new window) 10/25/2020, 11:40:32 PM French football match postponed after 11 test positive The top French football league was forced to call off a scheduled Sunday game after 11 players on one squad tested positive. RC Lens reported the outbreak among its 30-man squad to the Ligue de Football Professionel, the French governing body. The LFP postponed the Ligue 1 match between Lens and FC Nantes in response, it said on its website. Share on Twitter (opens new window) Share on Facebook (opens new window) Share on LinkedIn (opens new window) 10/25/2020, 11:21:52 PM Private jets take off as wealthy seek to avoid virus Philip Georgiadis and Alice Hancock in London Soaring numbers of wealthy flyers are switching to private jets to reduce the risk of catching coronavirus from other passengers on regular commercial flights. Several private jet operators and brokers have reported an influx of business from first-time users who are happy to pay a premium for a bespoke itinerary, involving minimal contact with the travelling public. Private jet passengers are often able to drive straight on to the tarmac to get to their flight, cutting out any mingling with other passengers at the airport or on board. Read more here Share on Twitter (opens new window) Share on Facebook (opens new window) Share on LinkedIn (opens new window) 10/25/2020, 10:54:21 PM Study notes sharp fall in non-Covid respiratory cases George Russell in Hong Kong Social distancing is sharply reducing the level of respiratory viral infections this year, according to a team of US researchers. The team combed data from a 16-week period in each of the years from 2016-2020 of admissions to a hospital in the north-eastern US state of Connecticut. They found that in the years from 2016 to 2019 the Stamford Hospital laboratory diagnosed a total 327 influenza cases and 223 cases that yielded a positive result from a Biofire test, which diagnoses respiratory infections. That represented an average of 138 cases per season. During the same period in 2020, only one case of influenza and three positive Biofire cases were seen. “In the midst of the Covid-19 pandemic, we were surprised to find that all other respiratory viral infections fell precipitously,” the researchers noted. Kindergartners socially distance as they leave class in Stamford, Connecticut The research team, led by Michael Parry of Stamford Health, published results over the weekend in the Infectious Diseases Society of America’s online publication, Open Forum Infectious Diseases. They attribute the sharp drop to widespread use of public health interventions, including wearing face masks, social distancing, hand hygiene and stay-at-home orders. “Since these interventions are usually ignored by the community during most influenza seasons, we anticipate that their continued use during the upcoming winter season could substantially blunt the caseload of influenza and other respiratory viral infections,” the team wrote. Share on Twitter (opens new window) Share on Facebook (opens new window) Share on LinkedIn (opens new window) 10/25/2020, 10:30:30 PM Dunkin’ Donuts owner closes in on $9bn sale James Fontanella-Khan and Ortenca Aliaj in New York Dunkin’ Brands, the US parent company behind the Dunkin’ coffee and doughnuts chain, is nearing a deal to be acquired by private equity-owned Inspire Brands for about $9bn, in a move that would delist it from the stock market, said people briefed about the matter. Inspire Brands, which is backed by consumer focused US private equity group Roark Capital, has made an offer worth $106.50 a share for Dunkin’ Brands, representing a 20 per cent premium on its closing price on Friday. The deal is the latest in a wave of US mergers and acquisitions in recent months as companies across sectors have been bulking up despite economic uncertainty linked to a renewed spike in coronavirus cases and the outcome of the US election. Read more here Share on Twitter (opens new window) Share on Facebook (opens new window) Share on LinkedIn (opens new window) 10/25/2020, 10:07:32 PM Bulgarian PM tests positive for coronavirus Bulgarian prime minister Boyko Borissov said on Sunday that he has tested positive for coronavirus. Mr Borissov said in a Facebook post that he feels “general discomfort and will stay at home”. He tested positive on Sunday after two earlier negative tests, he said. “The doctors recommended that I stay at home,” Mr Borissov wrote on Sunday afternoon. On Friday, the Bulgarian News Agency reported that Mr Borissov was self-isolating after being in contact with a deputy minister who had tested positive. He has been Bulgaria's government leader since 2017 after serving two earlier terms from 2009-13 and 2014-17. Mr Borissov, a former mayor of Sofia, heads the conservative GERB party. Share on Twitter (opens new window) Share on Facebook (opens new window) Share on LinkedIn (opens new window) 10/25/2020, 9:48:37 PM The Covid-19 pandemic: FT readers respond The coronavirus pandemic has killed more than a million people and countless more lives have been devastated by its impact. But could the world have been spared such a disaster if it had responded differently? In a six-part Financial Times investigation, we examined what went wrong and what went right as Covid-19 spread across the world. The series drew reader responses from across the world from people who had been affected by the pandemic in many different ways. Read some of the most thought-provoking comments here. Share on Twitter (opens new window) Share on Facebook (opens new window) Share on LinkedIn (opens new window) 10/25/2020, 9:27:35 PM New outbreaks hit British Columbia aged centres Health officials in Canada’s westernmost province are battling four new outbreaks, the British Columbia government said at the weekend. “There have been two new health-care facility outbreaks,” provincial health officer Bonnie Henry said in a statement, bringing the number of aged-care and assisted-living centres in the province gripped by the pandemic to 16. “In recent days, we have seen a number of new outbreaks of Covid-19 in the community and in long-term care facilities,” she acknowledged. Dr Henry also reported new outbreaks at Coast Spas Manufacturing, a maker of outdoor leisure equipment in the city of Langley, near Vancouver, and Pace Processing, a foodservice company in nearby Surrey. “Contact-tracing teams throughout our province are working around the clock to stop further spread,” she said. Share on Twitter (opens new window) Share on Facebook (opens new window) Share on LinkedIn (opens new window) 10/25/2020, 9:03:23 PM Covid-19 helps Japan find new tasks for robots Kana Inagaki in Tokyo Corporate Japan has found a new purpose for automation: business continuity in the uncertain era of Covid-19. Shares in Japan’s office, medical and industrial goods suppliers, including Askul, MonotaRo and As One, have soared as heavy investments in robots helped these companies to handle a jump in online orders during the pandemic. Coronavirus has boosted an existing trend in which Japanese ecommerce groups have turned to automation to counter a chronic labour shortage in a country that already makes half the world’s industrial robots. Read more here Share on Twitter (opens new window) Share on Facebook (opens new window) Share on LinkedIn (opens new window) 10/25/2020, 8:34:56 PM UK government pandemic approval rating falls to 29% Approval of the UK government’s handling of the coronavirus pandemic has fallen to its lowest level since March, a poll indicates. The Opinium Research poll showed just 29 per cent of British adults approved of the way the government has handled the pandemic, with 50 per cent disapproving. While the poll showed approval of the financial support offered during the pandemic – 43 per cent while 26 per cent disapprove – more than 40 per cent think economic support for people and businesses should go further. Only 32 per cent approve of how prime minister Boris Johnson has handled his role in this crisis, while 47 per cent disapprove. Chancellor Rishi Sunak has a 46 per cent approval rate, with 26 per cent disapproving, while Labour leader Keir Starmer scored 35 per cent approval and 29 per cent disapproval. Younger people are struggling to uphold social distancing and other pandemic-related rules, with 17 per cent of those younger than 45 saying they are either “not really” or “not at all” following the rules, up from 10 per cent a fortnight ago. Opinium carried out an online survey of 2,002 UK adults on October 22 and 23. Share on Twitter (opens new window) Share on Facebook (opens new window) Share on LinkedIn (opens new window) 10/25/2020, 8:05:36 PM US CDC urges safer practices at polling stations George Russell in Hong Kong As the US prepares to choose a president on November 3, the US Centers for Disease Control and Prevention have urged election officials to beef up polling place safety. In a paper published over the weekend, the CDC surveyed the September primary election in Democratic Party presidential contender Joe Biden’s home state of Delaware. The CDC, in its latest Morbidity and Mortality Weekly Report, said responses from primary election poll workers demonstrate the feasibility of implementing social distancing and other measures, but cautioned that safety gaps remain. “[The results] highlight the large number of persons poll workers have close contact with, as well as gaps in infection prevention, including ensuring correct mask use and providing training and personal protective equipment to poll workers assisting ill voters,” they wrote. Democratic party presidential candidate Joe Biden wears a mask as he leaves a television interview in Wilmington, Delaware Delaware, a Democratic stronghold, reported a high level of mask wearing since April, when the state government mandated their use in public places. In a July survey, about 79 per cent of people in the state reported always wearing a mask in public when in close contact with others. The new survey data, compiled by a team led by Eva Leidman of the CDC Covid-19 Response Team and Noemi Hall of the Delaware Department of Health and Social Services, indicate that the majority of both voters and election workers wore masks at polling places during the September primary, the CDC said. “However, the substantial proportion of respondents who reported observing incorrect mask use by voters (i.e., masks not covering the nose and mouth) suggests that further messaging on proper mask use, including at polling locations, might be needed to strengthen the effectiveness of masks during upcoming elections,” the researchers wrote. Share on Twitter (opens new window) Share on Facebook (opens new window) Share on LinkedIn (opens new window) 10/25/2020, 8:05:10 PM UK banks raise rates to stifle home loan boom Jim Pickford, Nicholas Megaw, Stephen Morris and George Hammond in London UK banks are turning away mortgage business by increasing interest rates on many new home loans, as they struggle to cope with surging demand for borrowing in a buoyant post-lockdown housing market. In a reversal of the cut-throat competition of recent years, lenders are putting up rates to deter potential borrowers, as coronavirus restrictions have left many staff working from home, limiting their capacity to process applications. A temporary stamp duty holiday that offers purchasers a tax saving of up to £15,000 has fuelled a V-shaped recovery in the housing market since May. Buyers are hurrying to progress deals now so they can complete before the nine-month holiday ends on March 31 2021. Read more here Share on Twitter (opens new window) Share on Facebook (opens new window) Share on LinkedIn (opens new window) 10/25/2020, 8:04:18 PM News you might have missed … The Netherlands and Austria will send 120 ventilators to the Czech Republic, which is reporting record levels of new Covid-19 cases, the European Commission said. The Dutch are providing 105 machines, while Austria is sending 15 ventilators and 30 high-flow nasal oxygen therapy devices. Singapore’s health ministry said it would test all employees of Changi Airport Terminal 3 after a security officer and a health worker tested positive for coronavirus. “Both cases were detected under our enhanced community testing,” the ministry said in a statement. Dubai’s government announced a Dh500m ($136m) stimulus package over the weekend aimed at reviving small businesses hit by the coronavirus pandemic. The latest cash injection brings the total value of Covid-19-related stimulus for the second-largest of the United Arab Emirates to Dh6.8bn. The autonomous Muslim region in Mindanao has the lowest infection rate in the country, the official Philippine News Agency reported on Sunday. Ameril Usman, acting regional health minister, attributed the low rate to “prompt reporting” and community engagement. The region has recorded 1,538 cases as of Friday. Franklin Templeton is on track to end 2020 with the highest year-to-date outflows of any asset management company globally, bleeding a net $41.6bn, according to Morningstar data. The coronavirus market shock also forced the fund house to liquidate six Indian mutual funds managing $3bn of assets. Scotland’s first minister, Nicola Sturgeon, insists the nation is making progress in tackling coronavirus as she set out plans for a five-tier system of alerts for different areas, along with support for businesses forced to close or reduce activities. She said slower rise in infections in recent weeks was a cause for optimism. Foreign debt investors have flocked back into Egypt, reversing billions of dollars of outflows sparked by the coronavirus pandemic, according to the country’s finance minister, Mohamed Maait. He said foreign investors now held more than $20bn in debt, reflecting confidence in the only regional economy that has grown this year. US folk singer Arlo Guthrie has retired from touring after the pandemic interrupted a planned comeback following a stroke he suffered in 2016. He announced in a Facebook post that he would no longer perform live. “Going from town to town and doing stage shows, remaining on the road is no longer an option,” Mr Guthrie wrote. Share on Twitter (opens new window) Share on Facebook (opens new window) Share on LinkedIn (opens new window) 10/25/2020, 8:03:57 PM China-led bank to lend $300m to Russian Railways A medical worker checks the temperature of a passenger from Beijing at the Yaroslavsky railway station in Moscow The China-led Asian Infrastructure Investment Bank will lend Rbs22.8bn ($300m) to Russian Railways to tide the state-run agency over the coronavirus pandemic. The AIIB said the loan to RZD, as the group is known, would “help alleviate the temporary liquidity constraints” caused by the decline of long-haul passenger demand. RZD's passenger totals have fallen as much as 70 per cent below normal in some months of this year. The AIIB lifeline would help preserve jobs at the railway company, the bank said. “Railway services ... remain a socially significant and the most affordable means of transport for millions of citizens,” said Konstantin Limitovskiy, the bank’s vice-president of investment operations. Share on Twitter (opens new window) Share on Facebook (opens new window) Share on LinkedIn (opens new window)
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Japan has spent 50 years fretting about its low birth rate and declining population but new prime minister Yoshihide Suga has hit on a different solution: fertility treatment. In his leadership campaign, Mr Suga called for in vitro fertilisation to be covered on national health insurance. The prime minister wants to make it affordable in a country where the average age of first-time mothers is now above 30 and nearly one in five couples has had tests or treatment for infertility. Mr Suga hopes the policy will raise Japan’s fertility rate, which stood at 1.36 children per woman in 2019. The fertility rate has been below the replacement level of 2.1 since the 1970s, locking in decades of future population decline with profound consequences for Japan’s society, economy and national security. But while subsidies for fertility treatment reflect a slow shift in Japan towards supporting parents rather than criticising the childless, experts said it still did little to address the economic insecurity and gender inequality that discouraged marriage and raising children. “To lower the hurdle even a little bit for any family that wants a child, we should work rapidly to include fertility treatment on health insurance,” said Mr Suga last week, framing the policy explicitly as a “countermeasure to the falling birth rate”. Infertile couples struggle in Japan, said Akiko Matsumoto, who campaigns on their behalf as head of a charity called Fine. “There are four burdens: body, mind, money and time.” Not only is the treatment physically draining and psychologically stressful, but there is little financial support and employers grudge the time off for medical appointments. “If someone tries three or four rounds of treatment, it can easily run to ¥4m ($38,000),” she said. Ms Matsumoto has lobbied the government to provide insurance coverage for fertility treatment but said the details were critical. A cost cap limiting available treatments “would harm patients”, she said. Even if the insurance cover is generous, analysts are cautious about how much it will affect birth rates. “It’s very hard to estimate but in 2018 there were around 57,000 births due to IVF. That could increase to 100,000 [if covered on insurance],” said Isao Takumi, senior researcher at the Meiji Yasuda Research Institute. One in every 16 children born in Japan today is a result of IVF and the figure has risen fivefold in the past 20 years. “I think covering fertility treatment is an excellent idea but it depends a lot on the details of the policy,” said Mr Takumi. An extra 43,000 children a year would make a difference, but Japan was shocked last year when the number of births in the country fell to 865,234, compared with 918,400 in 2018 and more than 2m at the early 1970s peak. After reaching a trough of 1.26 in 2005, Japan’s fertility rate recovered to 1.45 by 2015, but it has since fallen for four years in a row. Current fertility is well below that assumed in projections that Japan’s population will decline from 127m in 2015 to 88m by 2065. Sumio Saruyama of the Japan Center for Economic Research, who co-wrote a proposal to stabilise the population by matching French levels of childcare and family spending, said that being able to combine work and family was a necessary condition for Japanese women to have more children. “The fundamental cause of the falling birth rate is the rise in women’s economic power,” he said. Nations around the world have experienced the same phenomenon as the opportunity cost of having children rises for well-educated, high-earning women. But Japan’s culture of long hours makes it difficult to work and look after children, and childcare is expensive and hard to find, while surveys show that Japanese men do less work in the home than their counterparts in Europe or the US. Mr Saruyama said he had not studied the impact of fertility treatment on birth rates. However, his analysis suggests the cost of giving birth is less relevant than the opportunity cost of lost earnings. Although Mr Suga does not hide his ambition of raising the birth rate, he is also careful to avoid any suggestion of state interference in private decisions about whether to have children. The subject is a taboo in Japan since the militarist government of the 1930s suppressed birth control and made an ideology out of increasing the population. Ms Matsumoto is delighted by the public attention being paid to fertility treatment. But her mission is to help those who desperately want a child and she dislikes the idea of linking that to birth rates. “People aren’t having children for the sake of the country,” she said. “They don’t want to be told to get fertility treatment just because it is available. They have a right not to have children as well.”
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China’s leadership will start discussions on Monday to set the country’s long-term priorities, with Beijing expected to focus on boosting technological self-sufficiency and domestic demand. The Fifth Plenum, a meeting of the Communist party’s leadership, will run until Thursday. It will conduct the country’s most important goal-setting exercise, drafting the next Five-Year Plan, against the backdrop of a worsening global economy and US sanctions. The plenum will also discuss a broad plan for the next 15 years, with goals that are likely to endure for at least the rest of 67-year-old President Xi Jinping’s rule. The process to draft a plan typically reveals the biggest worries and priorities for the Chinese leadership. This year’s meeting comes as the deadline for meeting the previous overarching goal of achieving a “moderately prosperous society”, is due to expire in 2021, the centenary of the founding of the Chinese Communist party. Beijing has hinted it would broaden out its focus on economic growth to include targets for environmental protection, innovation and self-sufficient development — such as in food, energy, and in chips. Mr Xi is also expected to use the exercise to consolidate his influence over the party and the party’s influence over governance, said Holly Snape, a fellow in Chinese politics at the University of Glasgow. “It’s useful to understand these broad goals in the context of an expression Xi seems fond of: the party, government, military, people, education, east, west, south, north, and centre — the party leads everything,” she said. In recent months, Mr Xi has reiterated the idea of developing a “dual circulation” economy in which China will develop domestic demand and self-sufficiency as the rest of the world remains stalled by coronavirus. China has for decades valued technological self-sufficiency, but “there’s an important shift coming in the next five years”, said Samm Sacks, cyber security policy fellow at New America, a Washington-based think-tank. US sanctions on Huawei, the technology group, have shown Beijing how easily a national champion can be brought down by a blockade on US technology. “The government is now looking to keep more of the advances of its homegrown tech sector inside China, especially R&D and expertise gleaned from foreign companies,” added Ms Sacks. Beijing has set an average annual gross domestic product growth-rate target in every Five-Year Plan since 1986. But this year, as the economy was pummeled by the Covid-19 pandemic, China for the first time did not define a target. Economists at Macquarie Group expect that the goal will be lowered from the 6.5 per cent set in the current plan to 5 per cent in the next. They also believe the goal to be given less prominence. The Five-Year Plan will also explain how the government will meet Mr Xi’s target of zero net carbon emissions by 2060. After this week’s Central Committee meeting closes, a brief outline of the Five-Year Plan will be released. But the plan itself will not be ratified and is likely not to be made public until the next meeting of the rubber-stamp legislature, usually in March the following year.
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The owner of the Dunkin’ coffee and doughnuts chain and Baskin-Robbins ice cream franchises is nearing a deal to be acquired for about $9bn by the private equity-backed fast food group behind Buffalo Wings and Sonic. Inspire Brands has made an offer worth $106.50 a share for New York-listed Dunkin’ Brands, said two people with direct knowledge of the matter, representing a 20 per cent premium to the target’s closing share price on Friday. The deal, which would delist Dunkin’ from the stock market, could be announced in the next few days barring any last-minute glitches, the people said. In a statement on Sunday, Dunkin confirmed that it has held talks to be acquired by Inspire. Dunkin, based outside Boston, said it was still uncertain whether a deal would be finalised. The deal would make the company, which has more than 13,000 Dunkin’ outlets and about 8,000 Baskin-Robbins in its portfolio, all of them franchised, part of a fast food empire that also includes Rusty Taco, Jimmy Johns and Arby’s. Inspire, based in Atlanta, controls $14.6bn in annual sales and 11,000 restaurants through a network of more than 1,400 franchisees. It is backed by consumer-focused US private equity group Roark Capital, whose other interests include The Cheesecake Factory, Cinnabon and Anytime Fitness. The prospective deal, first reported by the New York Times, is the latest in a wave of US mergers and acquisitions in recent months. Companies across several sectors have bulked up despite the economic uncertainty linked to a renewed spike in coronavirus cases and the outcome of the US presidential election. US restaurants were badly hit earlier in the year after government authorities across the country imposed lockdowns to curb the spread of coronavirus. However, demand for convenience during the pandemic have helped fast-food chains outperform, especially those with drive-through facilities. Dunkin’, which is run by chief executive David Hoffmann, has been assessing a sale for some time, the people added. Shares in the company hit an all-time high last week to close at $88.79 on Friday, up 16 per cent year to date. “Dunkin’ has demonstrated strong recovery trends amid a challenging environment,” analysts at Credit Suisse said in a report on Friday, noting that about 70 per cent of its outlets have drive-through. The company is scheduled to report third-quarter earnings on Thursday. Analysts are expecting US same-store sales to tick 1 per cent lower in the third quarter, but to turn positive in the fourth quarter. The deal with Inspire would return Dunkin to private equity control after nine years on the public markets. Its previous owners — Bain Capital, the Carlyle Group and Thomas H Lee Partners — took the company public in 2011. Additional reporting by Patrick Temple-West in New York
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Coronavirus and lockdown have fuelled a surge in the use of technology, whether for making art, doing business, relaxing or simply staying in touch. “The irony is not lost on me,” laughs my lunch companion. In her breakthrough novel, published in 2014, Emily St John Mandel imagined a rather different outcome to a pandemic — a post-technology world. The few survivors of an apocalyptic virus have to rediscover how to generate electricity; the smartphones and credit cards on which they once relied are inert objects of curiosity in a ramshackle museum in an abandoned airport. She assumed it would be “pandemic and then no technology”, the Canadian novelist tells me from her home in Brooklyn. “And it’s been exactly the opposite.” As politicians and scientists have struggled to cope with the pandemic, I have turned to the 41-year-old Mandel for a different perspective. At a time of uncertainty, it seems worth listening to someone who spent years imagining our response to such a catastrophe through the lens of fiction. Station Eleven, her post-apocalypse novel, was a finalist in the National Book Awards and won the Arthur C Clarke Award for science fiction. But what I love about Mandel’s work is that it cannot be categorised that easily. Her first novels — pigeonholed as “literary noir” — earned her a reputation as a thriller writer. Her latest work, The Glass Hotel, is as intricately plotted as the finest crime fiction, interweaving different and alternative lives, but it does so in ways that shed light on how we might learn to live with our current predicament. Decades on from the pandemic in Station Eleven, the central troupe of performers roam through a semi-rural landscape, having abandoned cities. Her fictional virus killed almost all of those infected. “What’s been staggering to me with Covid-19 is seeing the degree to which society grinds to a halt with a single-digit mortality rate: it’s kind of shocking,” says Mandel. She also pictured a situation in which the pandemic would “flip a switch” from civilisation to chaos. In real life in 2020, the implications of coronavirus dawned only slowly as outbreaks spread around the world. At one point in March, Mandel wrote in her diary: “I wonder if this thing will really arrive.” “Those three weeks or so around late February, early March,” she says, “they’re kind of haunting to me in retrospect.” We are talking, in the 2020 way, over video. Mandel, her husband and four-year-old daughter have been relatively comfortable over lockdown in urban New York. She acknowledges they are privileged compared with people forced to isolate in small apartments, though she is maddened by the repeated suggestion that remote-working parents have any time to “learn Italian and take up painting . . . ‘King Lear was written during quarantine’ . . . well, fair point. But was he homeschooling a four-year-old?” Early during the city’s lockdown, she concentrated on gardening, making her roof terrace “as magical as it could possibly be, with the thought that it might not be safe to go to parks”. Her lunch of pad thai has been brought to her door by a company called Daily Harvest, which delivers frozen fruit-and-vegetable meal-boxes weekly, while I am enjoying a homemade butternut squash curry. Both of us are largely confined to our immediate neighbourhoods. It seems out of the question that I will return to my daily half-hour commute into London. “I can see Manhattan from my rooftop terrace, and it’s a half-hour away in the metro, but it suddenly seems infinitely distant; it might as well be London,” Mandel agrees. What is likely to link fiction and reality, Mandel believes, is the survival of art, a central motif of Station Eleven. Theatrical and musical performers have been hard hit by the pandemic, but she hopes science will come to their rescue. “If there were some extremely reliable, less excruciating tests — a blood drop or something — then groups of actors could again come together and congregate and put on Lear,” she says. She is also reassured that “people are still buying books. If you go to the websites of the independent bookstores in New York City — places like Greenlight or Books Are Magic that I buy from all the time — they all have notes, ‘Due to the high volume of orders, we apologise for any delay in getting your order to you.’ There’s something wonderfully heartening about that.” Mandel is fascinated by the idea of parallel or alternative lives and universes. In Station Eleven, two of the characters speculate about a scenario where the devastating swine flu had never taken hold. Mandel mirrors that discussion in her new book, The Glass Hotel, whose characters constantly reflect on their possible counterlives. Her protagonist, Vincent, a young woman, imagines multiple counterfactual histories, including one in which the swine flu “hadn’t been swiftly contained” — in other words, the plot of Station Eleven. Mandel writes: “She [Vincent] could only play this game for so long before she was overcome by a kind of vertigo and had to make herself stop.” I point out that businesses have been conducting a similar exercise, running and rerunning alternative scenarios for their future in an attempt to work out how to advance through a full-blown economic crisis, when they cannot reliably predict what is going to happen next. “That’s really interesting,” Mandel says. “It sort of forces companies to become speculative fiction-writers.” As an individual, Mandel says you have to “reel yourself back in” to avoid falling down “the rabbit hole of thinking about what your life might have been”. In her case, as a Canadian who trained in Toronto to be a dancer, she says such speculation is easy: “I feel like it would have been somehow much more plausible for me to stay in Canada and be a dancer than have found my way to New York where I’m writing novels.” It is an endearingly modest vision. One trigger for Mandel’s shift to a literary life was money — or lack of it — another preoccupation of The Glass Hotel, which centres on a financial scandal based on the brazen Ponzi scheme operated by Bernard Madoff, which fell apart in 2008. “There’s something taboo about talking about money,” Mandel tells me as we pick at our parallel Thai meals, 3,500 miles apart. The dearth of fiction about business and finance is intriguing, she says, “given the incredible impact that having money, or not having money, will have on what happens to you, and your life”. She shies away, however, from the “lazy” habit of some writers who equate great riches with villainy in their work. “You can meet a lot of incredibly obnoxious, entitled people who have no money, but they expect certain things of the world that aren’t reasonable. And I’ve certainly met people with money who are just absolutely lovely . . . and donate an incredible fortune to charity every year. So it goes both ways.” The commercial success of Station Eleven gave Mandel a new insight into wealth and the opportunities and challenges it can offer. Raised without a “financial safety net”, she graduated from a conservatory programme in contemporary dance in Toronto loaded with student loans. “So when I fell out of love with dance and decided I didn’t want to do it any more, there was really no question of going back to school.” She turned to writing fiction, which she had loved since being homeschooled by her book-loving “hippie” parents in British Columbia. She has likened her genre-defying breakthrough novel to a winning lottery ticket. It enabled her to give up her job as a part-time administrative assistant at the cancer research lab at Rockefeller University in New York. She has been able to pay for one of her brothers to go through college, which “feels like an honour”, even though it underlines the unfairness of the world. Emily St John Mandel Delivery from Daily Harvest to Brooklyn, New York Brussels sprout and lime pad thai $8.99 Water with lemon Nespresso coffee with hazelnut milk Andrew Hill St Albans, UK Homemade Thai butternut squash curry Bottle Tiger beer Mandel’s childhood provides some of the backdrop for her latest novel. She situates the five-star hotel of the title in a remote part of Vancouver Island, reachable only by mail boat or kayak. But it was the Madoff scandal — and particularly news stories about a closed group of workers who were privy to the crime — that inspired the book. She found herself thinking about the camaraderie she felt with her co- workers at the research lab. “Now imagine how much wilder and stranger and more intense that would be if you and your colleagues were showing up at the office to perpetuate a massive crime . . . What story do you have to tell yourself, if you’re one of those people, to sleep at night? How do you convince yourself that it’s somehow OK?” Around this, Mandel shapes the story of Vincent, a bartender at the hotel who becomes the trophy wife of the fraudulent scheme’s architect before fading back into an anonymous role as a cook on an ocean freighter. It is a complex examination of the what-ifs and what-might-bes of 21st-century existence. The backdrop for the Ponzi scheme’s collapse is the 2008 financial crisis. Mandel says she thought of it as “writing historical fiction” but adds that the book also speaks “to the idea that on both sides of the Atlantic, we’re in this time of the man and the empty suit. It’s kind of this era of conmen . . . We have this terrible phenomenon where citizens in the same country occupy these alternate realities depending on which news source they go to.” Mandel is now sipping on a Nespresso with hazelnut milk. I have opened a chilled Thai beer. I ask about her recent decision to step away from Twitter, where she was an engaged and engaging presence during the promotion of her new book. “There was a period at the beginning of the pandemic where I really liked it,” she says. “When we were all frankly somewhat traumatised, to be able to connect with people who didn’t live in my house felt kind of revelatory. But then I just found myself thinking ‘I kind of dislike this, what if I tweeted that I won’t be back until 2021?’ ” I point out that it means she is dodging the sinkhole of social media in the run-up to the US presidential election. “Without Twitter there would be no President Trump,” she observes. Catastrophes have provided rich fuel for Mandel’s fiction. “A disaster is a very efficient way to create a lot of drama,” she says. She prefers, though, to allow world events to sit in the background of her work, as one of her favourite authors, Ali Smith, does in her “Brexit” quartet; she is a little concerned about the books the current crisis will inspire. “I’m sure a lot of novelists are sitting at home writing their pandemic novels. But since we’re all kind of going through the same experience, how do you differentiate your Covid-19 novel from everybody else’s Covid-19 novels?” she says. The Glass Hotel came out in the US and Canada in March, just weeks before the advancing pandemic shut down plans for signings and talks. Mandel was still in demand — but interviewers and commissioning editors wanted insights from her last novel, not the new one. She turned down invitations to write op-ed columns about Covid-19 — “It just felt a little bit gross to me . . . this idea that I was somehow profiting off the pandemic to shift units” — and resisted talking about Station Eleven in interviews “for about a week” before caving in. It was, she says, “the contagious elephant in the room”. So what does her imagination tell her about how to emerge from the pandemic? Mandel envisages “a bit of a tedious grind”, as we await a vaccine. Her prediction is based in part on a prescient March blog post by Tomas Pueyo, called “The Hammer and the Dance”. “As numbers start to drop, it begins to seem safe to begin the dance . . . cautiously opening one thing at a time,” says Mandel. But when infection numbers rise, the hammer comes down. The successful publication of her book under lockdown has also made her think about the future of cities if underpaid staff no longer need to live in overpriced conurbations. She predicts a more decentralised world but is reluctant to uproot the family from their Brooklyn home, with its sunny terraces and home-office view to the tree-lined sidewalk and the school across the street. Still, the notion of an alternative life elsewhere nags at her and her husband. She has found herself browsing the immigration requirements for New Zealand. “I just had this thought: ‘How long do you keep your child home from school, or have them participate in some kind of wildly compromised remote learning [or] two-days-a-week with face masks education, before you throw in the towel and go to somewhere that actually has control of the virus?’” I mention that the current limbo, with its combination of personal and professional anxiety, reminds me of the years after the 9/11 attacks. At the time, my wife and I lived in Manhattan, with two children under five. We had to ponder whether to stay or leave. Our eventual decision to return to the UK was influenced by the sense that something else bad was going to happen. In the end, Manhattan was spared further mass attacks. Instead, global terrorism followed us across the Atlantic. Mandel’s smile fades for a moment. Despite her love for New York, she says, “I often feel that I’m kind of done with this country.” After her daughter was born, her principal concern was gun violence in the US, but “now I’m grappling with the same dilemma in the context of the pandemic”. The coronavirus crisis will set many people off on a path to an alternative life, we agree. Mandel’s two latest books suggest, at least, that sometimes acceptance is the only sensible response to calamities. As one character in The Glass Hotel reflects after the fraud has destroyed his savings, it is, after all, “just one future slipping away and being replaced by another”. Andrew Hill is the FT’s management editor From the FT Weekend library Light after lockdown — the Future of books How is the crisis changing our reading habits and accelerating the industry’s digital revolution? Part of a FT series The Glass Hotel — the downfall of A fraudster Emily St John Mandel’s novel asks what happens when the rich are cast out of the ‘kingdom of money’ Follow @FTLifeArts on Twitter to find out about our latest stories first
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Load new posts 10/23/2020, 12:20:25 AM Peter Spiegel, US Managing Editor On national TV, we're watching images of a socially-distanced debate stage in Nashville that is now absent the plexiglass dividers that featured in the vice-presidential debate a couple of weeks ago. Earlier in the evening, two man-sized dividers stood between the candidates' podiums, but according to campaign aides, they were removed after both Trump and Biden tested negative in coronavirus tests. The neutral arbiter who reviewed the tests? Antony Fauci, the infectious disease expert on the White House coronavirus task force — and the man who Trump has spent much of the week bashing. Share on Twitter (opens new window) Share on Facebook (opens new window) Share on LinkedIn (opens new window) 10/23/2020, 12:19:36 AM Edward Luce, US National Editor I had a dream the other night that Lincoln was debating Douglas and they looked like Biden and Trump. Actually, I didn’t dream that, but the contrast is worth emphasising. Those legendary series of debates took place in 1858 on the eve of the civil war before Lincoln ran for the presidency. When people talk about progress, they are usually referring to improvements in living conditions: we live longer, are better educated, and employ people rather than own slaves etc. If you were to measure American change by the quality of public debate, however, I doubt we would use the word “progress”. The first Biden-Trump debate last month was to Lincoln-Douglas what Heinz baked beans is to foie gras. Would it be too much to hope for less hooliganism and more substance tonight? Around the time of the Lincoln-Douglas debates, John Stuart Mill wrote that he would rather be Socrates dissatisfied than a pig satisfied. I don’t believe anyone, even the hardiest Trump supporter, could have been satisfied with what happened in the first debate. Is it possible that at some level this takeaway has penetrated Trump’s consciousness? Share on Twitter (opens new window) Share on Facebook (opens new window) Share on LinkedIn (opens new window) 10/23/2020, 12:16:43 AM Rana Foroohar, Global Business Columnist Apparently some Republican believers are feeling Catholic guilt, or at least a version of it. I was struck by the fact that the granddaughter of the Rev. Billy Graham, an anti-abortion evangelical Christian, is voting for Biden because she believes Trump is trying to “hijack our faith for votes.” This reminds me of the very smart Democratic campaign signs I have seen in the biggest swing state, Pennsylvania, that have pictures of older white men and younger white women with slogans like “I’m Republican, I’m a business owner, I’m for Biden,” or “I’m a mom, I’m a Christian, I’m for Biden.” This just deprives the President of oxygen, which is all too appropriate in the midst of Covid. Biden doesn’t have to advertise his empathy or faith, which are obvious, but he should definitely talk up the caring economy tonight, and the importance of giving parents and families support through the pandemic and what will likely be a deep winter recession. It connects the dots between faith, care, health, and jobs. Share on Twitter (opens new window) Share on Facebook (opens new window) Share on LinkedIn (opens new window) 10/23/2020, 12:09:51 AM Edward Luce, US National Editor I am still struggling to understand why the Trump campaign is so opposed to having his microphone muted. In a letter to the presidential debate commission, Bill Stepien, Trump’s campaign manager, said, “it is completely unacceptable for anyone to wield that editorial control”. Stepien would have been better off sending the commission a case of champagne. Aside from turning his own Covid infection into a personal drama, little has done Trump as much self-inflicted damage as his conduct during the first debate. He was hectoring, rude, loud, obnoxious and deeply personal. The encounter turned into a big win for Biden. As a result of Trump’s de facto sabotage of the first debate, candidates' mics will now be turned off when the other is giving their opening two-minute statement on each new topic (of which there will be six in total). That means Biden will have at least 12 uninterrupted minutes to tie himself up in verbal knots — precisely what the Trump campaign should want to happen. As I wrote in my review today of Evan Osnos’s excellent short book on Biden, the Democratic nominee has profited late in his career from learning the value of silence. “The more he [Trump] talks, the better off I am,” said Biden. The same, of course, is true in reverse. Share on Twitter (opens new window) Share on Facebook (opens new window) Share on LinkedIn (opens new window) 10/23/2020, 12:02:07 AM Demetri Sevastopulo, Washington Bureau Chief Shortly before the debate, the Biden campaign denied that the former vice-president had ever been involved in business with any of his family members. The denial was in response to repeated claims by Mr Trump — who has provided no evidence — that Mr Biden has profited from his son Hunter’s business dealings in China. “Joe Biden has never even considered being involved in business with his family, nor in any overseas business whatsoever,” the campaign said in a statement. In an effort to propel the attack, the Trump campaign brought Tony Bobulinski, a former business associate of Hunter Biden, to meet reporters before the debate. "I've heard Joe Biden say he never discussed business with Hunter. That is false," Mr Bobulinski (pictured below) told reporters. The Biden campaign said that while Mr Biden had never engaged in any such business, “Tony Bobulinski admitted on the record to Breitbart that he is angry he was not able to go into business with Hunter and James Biden”. The Biden campaign also referred to a recent story in the New York Times which revealed that Mr Trump had a bank account in China. “Donald Trump has a secret Chinese bank account and pays more in taxes in China than he pays in federal incomes taxes in the United States... this is a desperate, pathetic farce executed by a flailing campaign with no rationale for putting our country through another four years of hell.” When pressed on whether he had any evidence to back up his claims, Mr Bobulinski said the information was contained on three phones that he was carrying with him. But he declined to provide any specifics, saying only that he would discuss the evidence with Ron Johnson, a Wisconsin Republican senator who has promoted conspiracy theories about Hunter Biden. Joe Biden on Wednesday accused the senator of running a “smear” campaign. Share on Twitter (opens new window) Share on Facebook (opens new window) Share on LinkedIn (opens new window) 10/23/2020, 12:01:41 AM Rana Foroohar, Global Business Columnist It's also the economy, stupid: Aside from the President’s mishandling of Covid, this is what Biden should drive home tonight. Just as the Midwest and Florida are feeling the health crisis of a second coronavirus wave, they’ll also be at the centre of the coming tsunami of small business shutdowns, thanks to the President’s refusal to push through more fiscal stimulus. FT readers will know that I am the rare Democrat that frets about debt. I’m from Indiana, what can I say? But as I wrote in my column last Monday, there’s no question that we need more to get through the winter. Longer term, I am a fan of Biden’s focus on investment into green tech and the caring economy, which could set the stage for what venture capitalist Bill Janeway calls a “productive bubble,” in which government seeds a high growth area and the private sector then moves in. It’s the opposite of what we got during the Trump tenure, which as economist Alan Blinder summed up well was basically a job creation myth fueled by tax cuts and debt. Which reminds me of Ed’s smart Swamp Note from last week: Why is it that Republicans are so much better at cutting taxes than debt? Share on Twitter (opens new window) Share on Facebook (opens new window) Share on LinkedIn (opens new window) 10/22/2020, 11:52:40 PM Scenes from the trail Donald Trump and his wife Melania walk down the steps of Air Force One after arriving at Nashville International Airport, Tennessee, on Thursday. Share on Twitter (opens new window) Share on Facebook (opens new window) Share on LinkedIn (opens new window) 10/22/2020, 11:51:04 PM Edward Luce, US National Editor A couple of weeks before the 2008 presidential election, millions of people received a viral email purportedly from Barack Obama; “Everyone just chill the f*** out. I got this,” it said. I mention this to remind readers that there is nothing new about liberal paranoia. Democratic voters were suffering from election insomnia way before 2016. But this time it seems to be considerably worse. Partly this is post-traumatic stress syndrome from Trump’s shock defeat of Hillary Clinton. Since that outcome went against the overwhelming betting market and opinion poll consensus, why shouldn’t it happen again? In other words, people don’t trust the polls. Another reason, of course, is that so much more is at stake — a second Trump term is orders of magnitude worse in liberal (and many non-liberal) eyes than the prospect of a John McCain, Mitt Romney, or even George W. Bush presidency. But the biggest fear tonight is that Biden will flub his lines. Watching Biden debate is a bit like being in the audience when your child is acting in a school play. “Please don’t screw it up,” you whisper under your breath. If there is room left in this October for a surprise, the likeliest one is a Biden moment that enables Trump to revive his “Sleepy Joe is not all there” narrative. Most Americans like and trust Biden according to the polls. About the only thing that could override that is the fear that he is not fully in command of his faculties. Just to be clear: I think Biden is entirely compos mentis. To suggest otherwise is fake news. But a single debate screw up can be endlessly distorted. Share on Twitter (opens new window) Share on Facebook (opens new window) Share on LinkedIn (opens new window) 10/22/2020, 11:48:07 PM Scenes from the trail Leavin' on a jet plane. Joe Biden boards his aircraft in New Castle, Delaware, bound for Nashville, Tennessee. Share on Twitter (opens new window) Share on Facebook (opens new window) Share on LinkedIn (opens new window) 10/22/2020, 11:39:43 PM Rana Foroohar, Global Business Columnist It’s the pandemic, stupid: that should be the headline that Biden keeps coming back to in tonight’s debate. The rate of daily infections in the US is now at a three month high. Hospitalisations are hitting a two month high. The Midwest, including some of the swing states, are a new hot spot (I’m worried about my parents in Indiana and my daughter who is at school in Chicago, not to mention my brother in South Dakota, which is one of the biggest Western hotspots). Even in New York, where I have to say that Cuomo has done a stellar job managing the virus, new cases are rising. I personally have two close friends that just tested positive (I did the rapid response yesterday and am negative, thankfully). Winter Is Coming, and many people are feeling a sense of dread about getting through the second wave. The President is of course at the heart of that existential angst. As one of my favorite analysts Dave Rosenberg wrote in his “Early Morning with Dave” newsletter this morning: If Covid-19 wasn’t bad enough, a recent study published by the American Psychological Association found that 68% of American adults stated that the 2020 election generated a ‘significant source of stress’ in their lives. But here’s what is unusual —that number is 76% for Democrats and 67% for Republicans. For the Democrats, the memory of 2016 is fully intact and many believe that Mr. Trump will pull another rabbit out of the hat. Personally, I don’t think he will, because his mishandling of the pandemic has been so epic and the pain is front and center in swing states right now. Share on Twitter (opens new window) Share on Facebook (opens new window) Share on LinkedIn (opens new window) 10/22/2020, 11:29:27 PM Peter Spiegel, US Managing Editor Can a second presidential debate really alter the course of an election? If history is any guide, it’s usually the first debate that gets the biggest audience and sets the tone, which would be bad news for Donald Trump, whose first debate performance may go down as one of the most fatal in presidential history. John Kennedy was able to look young and vigorous in the first-ever debate in 1960, and Richard Nixon never really caught up. Al Gore rolled his eyes and sighed melodramatically in his first debate with George W Bush in 2000, an image of arrogance and pompousness that he never shed. Gerald Ford claimed there was “no Soviet domination of Eastern Europe” in his first 1976 debate with Jimmy Carter, a gaffe that would help doom his re-election chances. But there are examples where a candidate was able to turn things around later on in the debate series. The most significant — and perhaps most relevant to tonight’s duel — was Ronald Reagan’s re-election campaign in 1984. In the first debate against former vice-president Walter Mondale, Reagan stumbled over budget details and other policy minutiae, leading to questions about whether the incumbent’s age, then 74, was catching up with him. Those close to Reagan, including his wife Nancy, accused campaign staff of overwhelming the president with facts to remember. Paul Laxalt, a Nevada senator and longtime Reagan confidant, famously said that in the second debate, they would “let Reagan be Reagan”. The result was one of the most famous zingers in presidential debate history. When asked about his age, the incumbent quipped: “I will not make age an issue of this campaign. I am not going to exploit for political purposes my opponent's youth and inexperience.” [embedded content] The line had even more impact because a camera at stage right cut to a two-shot that showed Mondale laughing uproariously at the joke. And it was a joke: Mondale was 56 at the time, and had not only spent four years as vice-president, but had two terms as Minnesota senator under his belt — and had worked in national politics, including as an aide to fellow Minnesotan Hubert Humphrey, since the 1940s. Reagan’s age ceased being a campaign issue and he went on to win 49 states in November, losing only Mondale’s home state of Minnesota and the District of Columbia. Trump has never been particularly Reaganesque. But he may need the Gipper’s deft touch to turn things around tonight. Share on Twitter (opens new window) Share on Facebook (opens new window) Share on LinkedIn (opens new window) 10/22/2020, 11:19:27 PM Peter Spiegel, US Managing Editor Donald Trump's "closing argument" has thus far been hard to discern. Headlines have been dominated by Trump’s new line of attack against Anthony Fauci, which would seem to play right into Biden’s closing argument that Trump has mishandled the pandemic. And then there’s an apparent obsession with Hunter Biden, the Democratic candidate’s son who made the unseemly decision to sit on the board of a Ukrainian energy company while his father was vice-president. Even if Trump’s attacks on Hunter were accurate — and there’s ample evidence they’re mostly baseless — is this really a closing argument an incumbent president should be relying on? It may be that Trump believes he can repeat 2016, where his attacks on Hilary Clinton in the campaign’s closing days (aided by the FBI) planted seeds of doubt about Clinton’s ethics. But he’s not running against Hunter Biden, and prior scandals involving presidential family members have rarely shifted voter opinion. Indeed, Donald Trump Jr openly admitted to soliciting Russian dirt on Clinton during the 2016 campaign with no deleterious effect on his father. Hugh Rodham, Clinton’s brother, was accused of cashing in on his family connections when his brother-in-law was president — which also had no lasting impact. Neil Bush, George HW Bush’s son, faced allegations remarkably similar to those aimed at Hunter Biden — that he used his name to get top corporate positions and attract investors while his father was vice-president — but it had no impact on the 1988 campaign. Billy Carter accepted more than $200,000 from Libyan leader Muammar Gaddafi while his brother was president. Again, not a game changer. In 2016, Trump was pretty disciplined on his major themes in the weeks before Election Day: stop immigration, end capitulation to China, drain the swamp in Washington. Tonight will be key for Trump if he wants to relaunch any new closing argument with less than two weeks to go. I suspect he won’t. Share on Twitter (opens new window) Share on Facebook (opens new window) Share on LinkedIn (opens new window) 10/22/2020, 11:08:20 PM Peter Spiegel, US Managing Editor Welcome to the third and final FT US election debate “watch along” with our Swamp Notes columnists, Ed Luce in Washington and Rana Foroohar in New York, with me again serving as the orchestra conductor. We’ve received so much positive feedback from readers after our previous two outings that I’m half tempted to get Ed and Rana to do a live “watch along” with me post-election when the new season of The Mandalorian drops on Disney+, but we’ll save that for another time. As we approach this last head-to-head matchup, you’ll be hearing a lot of political professionals talking about the candidates’ “closing argument”. This is exactly what it sounds like: consultants push their candidates to hammer on the one or two big issues they want voters to remember when they walk into the voting booth. For Joe Biden, we’ve seen remarkable message discipline around this. It’s been pandemic, pandemic, pandemic...with a bit of soak-the-rich class warfare thrown in. But, predictably, Donald Trump hasn’t followed the traditional rhythms of campaigning, and it isn’t entirely clear what he views as his strongest “closing argument”. For a while, it looked like he was going to focus on “law and order” amid the civil unrest that erupted after the killing of George Floyd. But he isn’t hammering on that like he used to. Many in his inner circle have pushed him to talk more about the economy, and this morning’s improving jobless numbers could help there. But again, although he has attacked Biden’s tax plans, there hasn’t been a consistent, repeatable message. Share on Twitter (opens new window) Share on Facebook (opens new window) Share on LinkedIn (opens new window)
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The race for a coronavirus vaccine has stoked a debate on how much the jabs will cost and who will pay for them, as prices range from $3 to more than $30 a dose and public health advocates including Bill Gates call for a price cap for poor countries. Even as billions of dollars of public money has been poured into vaccine development, drugmakers have been reluctant to discuss how they will price a shot. They say it is the result of many factors including efficacy, trial results, development and manufacturing costs, competition, demand and whether the buyers are private groups — such as insurers — or state bodies. The pandemic’s urgency and global spread has added layers of intricacy. In the rush to develop the right vaccine, companies are experimenting with different technologies. In an unprecedented move, some drugmakers are then planning to allow other companies to manufacture their doses, further complicating cost calculations. US biotech company Moderna says it will charge a maximum of $37 a dose for its Covid-19 vaccine, among the highest prices disclosed to date © Chandan Khanna/AFP via Getty The pricing of all vaccine deals has been shrouded in secrecy, with companies and public institutions defending their right to confidentiality. But people briefed on talks between drugmakers and the European Commission say that AstraZeneca has sold its jab at about $3 to $4 per dose in deals with the EU, while the Johnson & Johnson shot and the vaccine jointly developed by Sanofi and GSK have come in at about $10 per dose. By contrast, Moderna — a newer and still lossmaking company — has sought to pitch its vaccine at about $50 to $60 per course of two jabs, after initially asking for almost double that amount. Other biotechnology businesses, such as CureVac, have said they would seek an “ethical margin” on their prices. Pressure from civil society and media reports have pushed some companies to disclose projected list prices, with Moderna doing so in August and publishing a maximum price tag of $37 a dose.  One of China’s vaccine frontrunners, Sinovac, this week began selling its vaccine in select cities at $60 for two shots as part of an emergency use programme with hundreds of thousands of participants. At the heart of the discussion lies a question both ethical and practical: whether pharmaceutical corporations should work with rich countries to ensure charges to poor nations are capped. Mr Gates, for example, told the Financial Times drugs companies should support a system whereby rich countries subsidise vaccines so that poor nations pay $3 or less a dose. “The price needs three tiers where rich countries are paying back a lot of the fixed costs, middle-income countries are paying back some of the fixed costs and the poorer countries are paying a true marginal cost,” Mr Gates, co-chair of the Bill & Melinda Gates Foundation, said in an interview. The billionaire software developer turned health philanthropist says any successful vaccine must be made available wherever it is needed at non-prohibitive cost. “We actually had to explain to a couple of pharma company CEOs that, in even the non-profit context, this tiering is absolutely necessary to maximise human benefit.” Some manufacturers in countries such as India, which has a large drug production industry, have criticised western drug companies that they see as trying to prop up prices, by failing to ramp up production to meet demand. “They don’t want to give it to the rest of the world because they’ll have to compete with me at $3 [a dose],” said Adar Poonawalla, chief executive of India’s Serum Institute, the world’s largest vaccine manufacturer. “We’re making a small margin but that’s just normal business,” he said. He added that higher production costs in Europe did not justify the difference in price between his company’s products and those of some western vaccine producers. Gavi, the UN-backed vaccines alliance, and the Gates Foundation last month expanded a deal with Mr Poonawalla’s institute for delivery of up to 200m doses of candidate vaccines licensed from AstraZeneca and Novavax to low and middle-income countries at a maximum of $3 a dose — with the option to increase the volume of the order several times over. Other initiatives to support global access include efforts by the Coalition for Epidemic Preparedness Innovations, which is co-funding nine vaccine candidates with a mix of partners including big companies and academic institutions. But the Covax initiative, the World Health Organization’s flagship programme to ensure the equitable global distribution of 2bn Covid-19 vaccinations by the end of next year, had to delay its full launch until this month after it struggled to sign up rich countries.* Mr Gates said he was hopeful in the long term that competition would keep prices down. “By the end of the year, or certainly in the first quarter of next year, the likelihood is that, of the six leading vaccines, two or three of them are likely to show efficacy, and then we’ll be off to the races,” he said. But he also acknowledged that prices for certain vaccines were likely to remain higher than others. For example, mRNA vaccines, such as those from Moderna and the Pfizer and BioNTech partnership, are more expensive to manufacture than vaccines based on an adenovirus vector such as the shot developed by AstraZeneca and Oxford university, he said. A fundamental challenge for effective planning and pricing is that all those involved have had to squash the normal decade-long vaccine development cycle into a fraction of that time, said one senior EU official. “We’re now trying to compress this to 12 to 18 months and not only produce a few vaccines but produce them in the order of hundreds of millions — even billions — in volume,” the official said. “This is risky business.” *This story has been amended to state that the Covax scheme is designed to provide vaccines to all countries and not just poorer nations Coronavirus: could the world have been spared? The coronavirus pandemic has killed more than 1m people across the globe. But could it have been averted? A unique FT investigation examines what went wrong — and right — as Covid-19 spread across the world. Explore the series
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American Airlines said on Thursday it would authorise issuing up to $1bn in shares to shore up its liquidity as the pandemic continued to weigh on revenue and profitability.The Fort Worth, Texas-based airline has raised billions on the bond market, but this is the second time since the crisis began that American has said it will sell equity. The company sold $750m worth of stock in June.American, which ended the third quarter with $13.6bn in available liquidity, said it would sell the shares at an “at-the-market offering”. On Wednesday, the company’s shares closed at $12.74. There are about 508,600,000 outstanding shares.Goldman Sachs, Credit Suisse Securities, Deutsche Bank, Morgan Stanley and BNP Paribas are involved in the transaction and receiving 1 per cent of the gross sale price, according to a filing with the Securities and Exchange Commission.American reported a pre-tax loss of $3.1bn on $3.2bn in revenue. Revenue plunged 73 per cent as passengers continued to shy away from flying.American also said its share of the funds from the US Cares Act has increased from $4.75bn to $7.5bn, although lawmakers have not passed additional funding.“This gives us more than double the liquidity we had at the start of the year,” chief executive Doug Parker and president Robert Isom said in a memo. “These funds will be critical as we continue to fight for the future of our company.”
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Israel and the United Arab Emirates have reached a historic peace deal that will see the Gulf power normalising diplomatic relations with the Jewish state. The deal, brokered by the US, would mean the UAE will become only the third Arab state to have full diplomatic ties with Israel, after Egypt and Jordan.  “HUGE breakthrough today! Historic Peace Agreement between our two GREAT friends, Israel and the United Arab Emirates!”, US President Donald Trump said on Twitter.  The UAE, a staunch US ally, has been increasing its intelligence and security co-operation with Israel in recent years as both share common goals in countering Iran’s influence in the region and fighting Islamic extremism.  Under Sheikh Mohammed bin Zayed, Abu Dhabi’s crown prince and the UAE’s de facto leader, the Gulf state has pursued an increasingly assertive foreign policy across the Middle East that has barely disguised its burgeoning ties to Israel.  The UAE move will be a significant victory for Israeli prime minister Benjamin Netanyahu, who regularly touts his success in improving Israel's relations with Arab states that were once sworn enemies. As part of the deal, Israel has agreed to suspend annexing parts of the occupied West Bank. Mr Netanyahu had promised to annex areas of the Palestinian territory as he campaigned in elections last year, but the process stalled in recent weeks.
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