Good morning.
It's Monday, the twenty fifth of September here in London. This is the Bloomberg Day Recurate podcast.
I'm Caroline Hepkin.
And I'm Stephen Carroll. Coming up today, the EU's top trade negotiator, warrens China it will be more assertive.
Anga grows as Rishi Sunat considers scrapping part of HS.
Two, And why Europe's unity on sending weapons to Ukraine may be in for another big test.
Let's start with a found up of our top stories.
The European Union's chief trade negotiator is Warren China that the EU will be more forceful and upholding fair competition and defending its interests. Valdas Dombrovskis says the lack of a level playing field and wider geopolitical shifts have forced the BLOCK to become more assertive.
Broadening access to China's market for foreign companies and maintaining a stable business environment is necessary to ensure fair and mutually beneficient trade relationships.
Don Brovski has made the comments on a trip to China, where he's meeting officials including Vice Premier Hurley Fang. The visit comes just days after the European Commission announced an anti subsidy investigation into Chinese electric vehicles.
Europe's main auto lobby group is urging policymakers to delay post Brexit tariffs on electric vehicles. From next year, eves traded between the UK and the EU will attract a ten percent tariff if less than forty five percent of their value comes from the block. The European Automobile Manufacturers Association wants the EU Commission to push back the charge. Failure to do so could reduce production by close to half a million cars over three years.
Bloomberg goodistounds that Italian banks will be able to avoid paying a controversial windfall tax introduced last month if they set aside additional capital reserves. The proposed amendment also changes the basis for calculating the levee to a percentage of the lender's risk weighted assets on an individual basis, instead
of their total assets. The new draft represents a compromise by Jo Maloni's government following a slump in Italian bank stocks and criticism from the ECB since the measure was first announced in August.
Former Conservative Prime Minister's business and university leaders are warning Rishi Sunac against derailing HS two, the one hundred billion pound rail project. Cabinet Minister Grant Shapp says that it would be irresponsible to plow money into the infrastructure scheme as costs saw.
We saw not just with HS two, but with our pace of change with net zero. That just because the media says this must be done, just because some people will say, you know, these are the popular things to do, He's prepared to do difficult things.
Shapps's refusal to deny the plans added to speculation that the government would ditch its own flagship infrastructure project. It comes as Prime Minister as she Sunac seeks to radically research his premiership as his popularity polls at an all time low.
In the United States, Republican hirdliner Matt Gates says he's ready to shut down the US government over budget took. The party are at odds internally on a government funding plan. In the House of Representatives, Representative Garrett Graves, as Gates has pushed to tie border policies into funding is counterproductive.
If you want to empower Senator Schumer, if you want to empower Joe Biden, then what you do is you let government shut down. You don't pursue a continue resolution, you don't pass the appropriations bills. That is the liberal solution.
Graves is an ally of the Republican Leader of the House, Kevin McCarthy, who struggle to control his party that holds a single digit majority in the lower House. McCarthy has until the end of the week to find a solution or the government will have no funding.
Meanwhile, Hollywood studios and screenwriters have reached a tentative deal to end a month's long strike. The Writers Guild of America, which represents Hollywood movie and TV script writers, walked out in May over pay and protections from the use of artificial intelligence. The industry has been at a virtual standstill in recent months, with actors also on strikes since July citing many of the same demands.
A NASA capsule containing chunks of an asteroid that may hold clues to the development of our solar system has landed in the Utah Desert after a seven year space mission. The Osiris REX mission was launched in twenty sixteen and scooped up a large sample of rocks from a near Earth asteroid. Three years ago, cosmochemist doctor Natalie Starky says it marks the first mission of its kind.
We don't have any other samples that can tell us about those times.
And the important thing is is.
They're pristine because they haven't been through atmosphere entry. They're going to be looked after in this capsule that's come back from the spacecraft, and they're just the perfect samples that we could hope for.
Doctor Natalie Starky and others believe the rocks could also help inform future missions to asteroids. The samples have been taken to NASA's Johnson's Space Center and could be opened tomorrow. Carl and Alexi user systems.
I must have been, I am. Yeah, so we've got at least two in the house.
I don't consider myself a luddie, but it's one of the things, one of the technologies that I have not adapted. I don't use voice assistance anyway.
Yeah.
I don't know whether it's paranoia over what it's being listened to, or that I just don't see a use you necessarily.
No, I can understand that. No, and I do.
And I also see really, given the leaps in artificial intelligence, why Bloomberg opiniconmist Dave Lee has written a story about what the point of Alexa actually is. I mean, I must admit I use it for very basic things like a timer. And Dave Lee is talking to the boss of Amazon's Alexa unit about actually what more this device is meant to deliver. I thought it was interesting that talking about maybe it becoming a subscription service.
Yeah, exactly. So Dave Limp is actually leaving Amazon at the end of the year. So this is sort of an interview about where the technology is going next. Very much worth reading from our Bloomberg opinion columns. Davely this morning.
Okay, let's turn our attention then to the big picture. To the eused chief Trade Negotiation says that the Block will become more assertive when it comes to trade with China. Veldus Dobrovskis says that China's lack of reciprocity means that the twenty seven nation Block wants to reset the relationship. This, of course after the EU launched an anti subsidy probe into Chinese electric vehicles. Joining US now to discuss this, but in both China and government Editor Jill de Sis
Good morning, Jill Dombroskis is in China. Then for these high level trade negotiations and talks, including with the Vice Premier who her live Fung, the EU is clearly concerned about trade with China.
Hey, Carolin, Yes, I think that's very easy to say that. I mean, look, this is an incredibly important trading relationship. I think the EU is a block is one of the largest trading partners for China. This is a relationship that involves some nine hundred billion dollars more in bilateral commerce. So yes, I think there's there's quite a lot of concerns here, especially if you look at the trend over
the last couple of years. The China is exporting more to the to the EU, but imports aren't really keeping pace there. So I think that there's a lot of concern within the EU just kind of about how the dependency looks, what they can do to kind of de risk and ring fence some of their operations, and that's what we saw spill over into for example, this whole
Chinese EV probe here. I think that that's you know, sort of a this this consequence of the push that Chinese electric vehicle makers have made into the European market, and then what that actually means for a lot of EU companies as well. And so all of this is kind of the backdrop to Brovkas visiting China over the last couple of days and kind of working through some of these high level talks.
What sort of sense do we have of their reception these remarks might get given what China has said previously about some of the actions like that ev investigation that the EU has launched.
Yes, well, I think that at this point, you know, easy to see that that China has obviously not been very happy with a lot of the eaves regressive remarks, this idea of them taking a stance, and we haven't actually had official reaction to this most recent speech Dombrovskis gave this morning. This was a speech, according to prepared remarks, that he give to Shanghai University in Beijing. But we know that he's been meeting a lot with Chinese officials
over the past couple of days. He's actually supposed to be in this meeting with Holy Fung Vice premiere at this moment. So I mean, you know, this is a very careful and considered relationship. I'm sure we'll get something more public out of China right now. But yes, they
have not been happy about that EV probe. There's a lot of sense within China that this is sort of unfairly targeting Beijing rather than being something that's a little bit more you know, sensible and maybe not as politically charged. But yes, you can you can see just from those types of remarks in the past over the CV probe, how how charged this really has become.
Yeah, absolutely so, then what about the next step, the idea of somewhat between Presidents Jimping and the EU's at Stavondale later this year.
I think that we're still waiting to see what form that might ultimately take and when exactly they would meet. I will say that what's happening right now, and so the entire reason why Broskis is currently in China is it's part of this this high level economic and trade dialogue. So, I mean, this is one of the most important EU
China related summits it's happening this year. So I think that what that does is even if you've got these you know, quite strong comments that are coming from the EU's trade chief at this speech, you know, I mean, there's a certain element of this that of course is strategic and calculated, and I think the fact that he's having some of these closed door meetings with really really high level officials kind of indicates that there is still
a desire to figure out this relationship, what things ultimately look like. I mean, look, just over the past couple of years, we've moved away from really strong language on decoupling, for example, to now de risking and sort of working
through this relationship. So sure, I think that once we get away from this, we've got a press conference from them broskis expected tomorrow, maybe we'll get a sense of what there's even higher level meetings between Banderly and she Jinping ultimately look like.
Okay, Jill Lisas, our China Government editor, thank you very much for joining us with the latest on that story. As Valderston Broxfast continues his visit to China.
Now we want to bring you a story from Slovakia next. The former Prime Minister Robert Fico could seal an unlikely comeback in elections this weekend, but he wants to end military aid to Ukraine, which could further test European unity on the issue. Our Eastern Europe Economy editor, Andrea Juditch is joining us now for more on this. Good morning, Andrea, thanks for your time. What does the victory potentially mean then for Europe's political landscape?
Good morning.
His possible victory will be a huge test for Europe and exter United State, for Ukraine and against Russia when it comes to sanctions and weapons deliveries.
How could a return to power change the broader stance that Europe has towards Ukraine and overall help for the.
Robert Fitzal has many times said that when he takes power, he will stop all deliveries of weapons to Ukraine from Slovakia, which is a NATO and EU member. He also said that sanctions in Russia are meaningless and useless, and they not only heard Russia, but also EU members such as Slovakia. So what we could see is him teaming up with Victor Orban of Hungary when it comes to crucial votes inside the EU.
Who's his main ally main allies within the European Union? I mean, you mentioned Hungary is a key ally, but who else is the ally to Robert Fitza.
During his previous terms, he was a very pro Western.
Politician who stood at the core of the EU. He oversaw the country's euro membership, but lately he has become very close to Hungary's Victor Orban and also to the leadership in Poland. So you could see a strength and block of countries that have been at our with the EU over the last few years when it comes to rule of law and corruption.
Fight and Jet tell us a bit more about Robert Fico. He's someone that has been around on the political scene in Slovakia for a long time, but notably has been out of office for several years.
Yes, he has been in power for the last time.
He was ousted several years ago and since then he has turned very.
Much anti against everything.
He was very vocal about the coronavirus, how people should not buy into the government stance. He was very much against Slovakia's help for Ukraine and has repeatedly said that sanctions are not the way to go when it comes to dealing with Russia. He also has seen his popularity fall to record law.
But because he has been able to.
Embrace this anti stance and everything he has really written.
In pouls in the country that is very pro Russian.
Yeah, five and a half million people in the country. Do you think that he's going to embrace the far right in his ruling coalition. Again, this is very much a theme across continental Europe. You know, what would the government look like potentially, what's the polling like, Well, it's to be seen.
Really depends on the election result and how many parties across the threshold to get into parliament. But what we could see is him teaming up with his former Ali who set up his own.
Party which mirrors the party of.
Robert Fitzal and possibly he could embrace the Farid in the ruling coalition. The Firerid in Slovakia has very extreme views on Ukraine's possible membership in NATO and overall help for Ukraine. So if that happens, that could really strengthen Robert Fitzos and a Ukrainian stance.
Who are his opposition in the selection. What are their strengths or their arguments given the position to the evautline that Robert Vico has.
Well, it's mainly there's.
The Progressive Party which is second in polls and the gap between them and Robert Fish's party has narrowed significantly in the last few months. There's a very liberal party that wants is the key player in the EU and in the country's back.
And forth Ukraine. What we just need to see.
Whether that party will be able to mobilize more voters. Whoever wins the election is the first party that gets to try to form a rule in coalition. So the victory, even if it's by a couple thousand goals, will be very important.
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