1
00:00:02,800 --> 00:00:05,520
Speaker 1: Good morning. It's Monday, the sixteenth of October here in London.

2
00:00:05,559 --> 00:00:08,920
Speaker 1: This is the Blueberg Daybreak europe podcaster. I'm Caroline Hepge.

3
00:00:09,320 --> 00:00:13,760
Speaker 1: Coming up today a diplomatic drive. America scrambles to contain

4
00:00:13,840 --> 00:00:17,239
Speaker 1: the fallout from the Israel Hamas war as the risk

5
00:00:17,320 --> 00:00:22,079
Speaker 1: of escalation grows. The US also prepares to tighten curbs

6
00:00:22,120 --> 00:00:26,920
Speaker 1: on China's access to advanced chip technology. Plus housing in

7
00:00:26,960 --> 00:00:30,040
Speaker 1: growth data in the UK point to pessimism about the

8
00:00:30,080 --> 00:00:33,280
Speaker 1: prospects for the economy. Here, let's start with a roundup

9
00:00:33,320 --> 00:00:36,680
Speaker 1: of our top stories. President Joe Biden is considering a

10
00:00:36,760 --> 00:00:40,760
Speaker 1: trip to Israel as Western nations rampop efforts to prevent

11
00:00:40,880 --> 00:00:43,800
Speaker 1: the war with ha Mass from engulfing the region. The

12
00:00:43,800 --> 00:00:47,000
Speaker 1: diplomatic push comes as the US confirmed that the country

13
00:00:47,200 --> 00:00:51,280
Speaker 1: has held back channel talks with Iran, warning Tehran against

14
00:00:51,479 --> 00:00:54,880
Speaker 1: escalating the conflict. The efforts to keep the crisis from

15
00:00:54,920 --> 00:00:58,640
Speaker 1: further escalating comes as Israel continues to prepare for a

16
00:00:58,880 --> 00:01:03,440
Speaker 1: likely ground invasion of Gaza. In an interview with CBS's

17
00:01:03,440 --> 00:01:06,959
Speaker 1: news is sixty Minutes, President Biden stressed his belief that

18
00:01:07,080 --> 00:01:11,640
Speaker 1: Israel will act in accordance with international law. But stressing

19
00:01:11,680 --> 00:01:15,880
Speaker 1: he doesn't believe the country should control the territory long term.

20
00:01:16,120 --> 00:01:18,839
Speaker 2: I think it'd be a big mistake. Look what happened

21
00:01:18,840 --> 00:01:22,840
Speaker 2: in Gaza. In my view is Hamas in the extreme

22
00:01:22,880 --> 00:01:26,479
Speaker 2: elements of mass don't represent all the Palestinian people, and

23
00:01:27,360 --> 00:01:31,000
Speaker 2: I think that it would be a mistake, prettys real

24
00:01:31,160 --> 00:01:33,600
Speaker 2: to occupy Garz again.

25
00:01:34,959 --> 00:01:39,200
Speaker 1: Meanwhile, Israel's ambassador to the United States, Michael Herzog, spoke

26
00:01:39,240 --> 00:01:41,600
Speaker 1: to see an End State of the Union about the

27
00:01:41,600 --> 00:01:44,360
Speaker 1: country's likely invasion of the Gaza Strip.

28
00:01:44,760 --> 00:01:49,080
Speaker 3: We have no desire to occupy or reoccupy Gaza. We

29
00:01:49,120 --> 00:01:51,720
Speaker 3: have no desire to rule over the lives of over

30
00:01:51,800 --> 00:01:55,320
Speaker 3: two million Palestinians, and certainly want people to go back

31
00:01:55,400 --> 00:01:58,880
Speaker 3: to the homes. We're talking about innocent civilians and we

32
00:01:58,920 --> 00:02:03,080
Speaker 3: are doing everything we can to keep them out of

33
00:02:03,240 --> 00:02:06,360
Speaker 3: harms way, while Hamas is doing everything it can to

34
00:02:06,440 --> 00:02:09,280
Speaker 3: keep them in harm's way. That's a situation we are at.

35
00:02:10,840 --> 00:02:14,560
Speaker 1: Hertzog spoke after the Israeli military released a statement saying

36
00:02:14,600 --> 00:02:17,040
Speaker 1: that they are now preparing for an attack on the

37
00:02:17,040 --> 00:02:22,760
Speaker 1: Gaza Strip from quote air, sea and land. Palaesinian authorities

38
00:02:22,840 --> 00:02:25,280
Speaker 1: say that close to two and half thousand people have

39
00:02:25,360 --> 00:02:29,440
Speaker 1: been killed during Israel's bombardment of Gaza. The bombings come

40
00:02:29,639 --> 00:02:32,880
Speaker 1: in response to the initial attack by Hamas, which killed

41
00:02:32,960 --> 00:02:36,560
Speaker 1: at least one thousand, three hundred people. This as the

42
00:02:36,639 --> 00:02:39,639
Speaker 1: UN estimates that Garza's main hospital is close to running

43
00:02:39,639 --> 00:02:43,840
Speaker 1: out of fuel to power its generators. Doctor Kassan Abusita

44
00:02:44,080 --> 00:02:47,720
Speaker 1: is a Mezza sin Frantier surgeon working there. He says

45
00:02:47,760 --> 00:02:50,960
Speaker 1: that the civilian cost of a ground invasion will be

46
00:02:51,040 --> 00:02:51,720
Speaker 1: hard to bear.

47
00:02:52,120 --> 00:02:57,880
Speaker 4: It'll be in absolute catastrophe carnage. Gaza is so densely populated,

48
00:02:57,919 --> 00:03:01,320
Speaker 4: two and a quarter million people in a very small

49
00:03:01,400 --> 00:03:03,880
Speaker 4: area of lab This is a turky shoot, and if

50
00:03:03,880 --> 00:03:06,880
Speaker 4: you go into Gaza, you go in knowing that you're

51
00:03:06,880 --> 00:03:09,000
Speaker 4: going to have to commit massacres.

52
00:03:09,960 --> 00:03:12,640
Speaker 1: Those comments come as the Israeli military said that it

53
00:03:12,680 --> 00:03:16,200
Speaker 1: believes that more than six hundred thousand people have left

54
00:03:16,240 --> 00:03:19,360
Speaker 1: Girlza city and the surrounding area for the south of

55
00:03:19,400 --> 00:03:23,720
Speaker 1: the territory. Meanwhile, the only border crossing between Egypt and

56
00:03:23,840 --> 00:03:27,720
Speaker 1: Gaza is expected to open this morning, allowing aid to

57
00:03:28,000 --> 00:03:34,400
Speaker 1: enter and foreign nationals to evacuate. Now onto some other

58
00:03:34,480 --> 00:03:37,480
Speaker 1: stories this morning, the United States is planning to tighten

59
00:03:37,720 --> 00:03:42,680
Speaker 1: measures on China's access to advance semiconductors and chip making

60
00:03:42,720 --> 00:03:45,480
Speaker 1: equipment with more his Bloombergs head Baxter.

61
00:03:46,160 --> 00:03:49,480
Speaker 5: The first round happened in October, described as sweeping. So

62
00:03:49,680 --> 00:03:52,120
Speaker 5: what this will do is tighten the measures already in

63
00:03:52,160 --> 00:03:56,800
Speaker 5: place to refine to close loopholes controls on selling graphic

64
00:03:56,880 --> 00:04:01,200
Speaker 5: chips for AI and advanced chip making equipt the Chinese firms.

65
00:04:01,640 --> 00:04:04,600
Speaker 5: The US will also add Chinese chip design firms to

66
00:04:04,720 --> 00:04:09,680
Speaker 5: a trade restriction list on AI and impose additional checks

67
00:04:09,680 --> 00:04:13,160
Speaker 5: to firms trying to evade restrictions already in place by

68
00:04:13,280 --> 00:04:17,359
Speaker 5: routing through other nations, Ed Baxter, Bloomberg Radio.

69
00:04:18,440 --> 00:04:22,000
Speaker 1: Poland's opposition leader, Donald Tusk, has declared victory in the

70
00:04:22,000 --> 00:04:25,640
Speaker 1: country's general election, mocking a possible shift in the tide

71
00:04:25,640 --> 00:04:29,320
Speaker 1: of populist forces in europe An. Exit poll predicts that

72
00:04:29,400 --> 00:04:33,279
Speaker 1: the ruling nationalist Law and Justice Party has lost its

73
00:04:33,279 --> 00:04:36,880
Speaker 1: majority in parliament to a coalition led by the former

74
00:04:36,920 --> 00:04:42,240
Speaker 1: European Council President. Turnout was estimated at seventy three percent,

75
00:04:42,360 --> 00:04:46,599
Speaker 1: a record. The upset could steer the country back into

76
00:04:46,600 --> 00:04:50,440
Speaker 1: the European mainstream after the EU withheld more than thirty

77
00:04:50,480 --> 00:04:54,719
Speaker 1: five billion Euros to punish Warsaw for curbing the independence

78
00:04:54,760 --> 00:04:59,440
Speaker 1: of judges and the media. Here in the UK, home

79
00:04:59,480 --> 00:05:02,320
Speaker 1: seller is a tr trimming their expectations, with October's asking

80
00:05:02,360 --> 00:05:05,200
Speaker 1: prices rising by the smallest amounts since two thousand and eight.

81
00:05:05,240 --> 00:05:07,400
Speaker 1: Bloomberg's James Walcock reports.

82
00:05:07,240 --> 00:05:09,640
Speaker 6: Right Moves say the housing market is the most price

83
00:05:09,760 --> 00:05:13,600
Speaker 6: sensitive it's ever been. The toxic cocktail of higher mortgage

84
00:05:13,680 --> 00:05:17,320
Speaker 6: rates and inflation is hitting seller confidence, with sales down

85
00:05:17,400 --> 00:05:21,000
Speaker 6: seventeen percent compared to October last year. Landlords are also

86
00:05:21,080 --> 00:05:24,320
Speaker 6: being hard, paying forty percent more in mortgage interests than

87
00:05:24,320 --> 00:05:26,720
Speaker 6: a year ago. That's led many to pass on costs

88
00:05:26,760 --> 00:05:30,880
Speaker 6: to renters or leave the market altogether in London, James Wilcock,

89
00:05:30,960 --> 00:05:31,760
Speaker 6: Bloomberg Radio.

90
00:05:32,920 --> 00:05:33,120
Speaker 7: Now.

91
00:05:33,160 --> 00:05:37,080
Speaker 1: In US politics, House Democrats say that they are having

92
00:05:37,200 --> 00:05:41,240
Speaker 1: informal talks with Republicans about a potential bipartisan solution to

93
00:05:41,279 --> 00:05:46,000
Speaker 1: find a speaker. Democratic leader Hakim Jeffries has told NBC's

94
00:05:46,040 --> 00:05:49,760
Speaker 1: Meet the Press that politicians need to move onto the

95
00:05:49,839 --> 00:05:51,480
Speaker 1: people's real priorities.

96
00:05:52,080 --> 00:05:56,280
Speaker 8: We want to continue to put people over politics and

97
00:05:56,320 --> 00:05:59,040
Speaker 8: to fight for things like lower costs, better paying jobs,

98
00:05:59,040 --> 00:06:02,560
Speaker 8: safer communities, and to build an economy that works from

99
00:06:02,560 --> 00:06:05,280
Speaker 8: the middle out and the bottom up. On the other hand,

100
00:06:05,480 --> 00:06:09,520
Speaker 8: House Republicans have been focused on fighting each other. It's

101
00:06:09,560 --> 00:06:13,080
Speaker 8: time to in the Republican civil war.

102
00:06:14,240 --> 00:06:17,159
Speaker 1: Hakeem Jeffreys added that he would support changes to the

103
00:06:17,160 --> 00:06:21,600
Speaker 1: House's rules to prevent hardline Republicans who ousted the Speaker,

104
00:06:21,640 --> 00:06:25,839
Speaker 1: Kevin McCarthy from setting the agenda. Representative Jim Jordan is

105
00:06:25,880 --> 00:06:28,880
Speaker 1: currently the front runner for the speaker position, but a

106
00:06:28,960 --> 00:06:32,320
Speaker 1: number of moderate Republicans have said that they will not

107
00:06:32,480 --> 00:06:36,400
Speaker 1: support him. A word then, on the specific response to

108
00:06:36,400 --> 00:06:39,520
Speaker 1: what's happening in Israel here in the UK. Over the weekend,

109
00:06:39,560 --> 00:06:43,799
Speaker 1: thousands of people demonstrated in support of Palestinians. Be gathering

110
00:06:43,800 --> 00:06:47,120
Speaker 1: in London attracted large crowds but also more than a

111
00:06:47,200 --> 00:06:51,080
Speaker 1: thousand Metropolitan Police offices. The police had warned in advance

112
00:06:51,160 --> 00:06:54,800
Speaker 1: that anyone showing support for Hamas could face arrests. There

113
00:06:54,800 --> 00:06:58,360
Speaker 1: were also rallies in Manchester and Edinburgh. The UK government,

114
00:06:58,400 --> 00:07:01,919
Speaker 1: though remained steadfast in it support of Israel. There have

115
00:07:01,960 --> 00:07:05,240
Speaker 1: been concerns, of course, about the scale of the Israeli response,

116
00:07:05,279 --> 00:07:08,400
Speaker 1: but Rishi Sunac saying that at least on Friday and

117
00:07:08,440 --> 00:07:12,000
Speaker 1: over the weekend. The country has every right to defend itself,

118
00:07:12,560 --> 00:07:16,520
Speaker 1: although he stressed that civilian safety is paramount in our mind,

119
00:07:16,600 --> 00:07:19,440
Speaker 1: so that the response from the UK Prime Minister Rishi

120
00:07:19,440 --> 00:07:22,680
Speaker 1: Sunac I mean a similar response also from the opposition

121
00:07:22,840 --> 00:07:25,760
Speaker 1: Labor Party. It must be said, but it was noteworthy

122
00:07:25,800 --> 00:07:29,560
Speaker 1: that there are those demonstrations in the UK over the weekend. Meanwhile,

123
00:07:29,600 --> 00:07:31,960
Speaker 1: the spokesman for the Israeli embassy here in the UK

124
00:07:32,120 --> 00:07:36,640
Speaker 1: insisted that Israel is not targeting civilians, but to talk

125
00:07:36,680 --> 00:07:40,480
Speaker 1: about the impact and the casualties of the conflict with

126
00:07:40,560 --> 00:07:44,720
Speaker 1: Hamas in Gaza, meaning that is innocent people will pay

127
00:07:44,920 --> 00:07:49,360
Speaker 1: tragically with their life. So that's the view then from

128
00:07:49,360 --> 00:07:52,640
Speaker 1: the UK. Let's also talk, though more broadly, about what's

129
00:07:52,680 --> 00:07:56,560
Speaker 1: happening diplomatically. So the US Secretary of State Anthony Blincoln

130
00:07:56,760 --> 00:08:00,560
Speaker 1: is returning to Israel after diplomatic talks with Saudi Arabia

131
00:08:00,600 --> 00:08:03,920
Speaker 1: and Egypt and a warning from the US to Iran

132
00:08:04,080 --> 00:08:09,239
Speaker 1: against escalating the conflict. President Biden may also visit Israel soon.

133
00:08:09,720 --> 00:08:12,440
Speaker 1: He has told US media that he believes Israel would

134
00:08:12,560 --> 00:08:15,520
Speaker 1: act by the rules of war. The Israeli army is

135
00:08:15,520 --> 00:08:19,320
Speaker 1: poised to stage a large scale offensive in girls, something

136
00:08:19,360 --> 00:08:21,640
Speaker 1: that we've heard now for a number of days. Joining

137
00:08:21,720 --> 00:08:24,480
Speaker 1: us in the studio, Bloomberg's news director in Europe, the

138
00:08:24,480 --> 00:08:27,200
Speaker 1: Middle East and Africa, Rosslyn Mathis, and good Morning Rolls.

139
00:08:27,200 --> 00:08:29,280
Speaker 1: Thank you so much for being with us. How does

140
00:08:29,440 --> 00:08:34,400
Speaker 1: Israel firstly wipe out Hamas on the ground, it stated aim?

141
00:08:35,080 --> 00:08:37,280
Speaker 1: How can that objective be realized?

142
00:08:38,320 --> 00:08:41,320
Speaker 7: Well, that is the big question in fact, ken it

143
00:08:41,400 --> 00:08:44,800
Speaker 7: wipe out Hamas on the ground as well as how

144
00:08:44,960 --> 00:08:47,400
Speaker 7: and does it really want to? You're talking about a

145
00:08:47,400 --> 00:08:49,640
Speaker 7: group that does have a leadership structure and a lot

146
00:08:49,679 --> 00:08:53,400
Speaker 7: of organization, but it's also really quite a morphis in

147
00:08:53,480 --> 00:08:57,040
Speaker 7: many ways, and so sort of splinter groups that come

148
00:08:57,120 --> 00:08:59,560
Speaker 7: off at, support groups that come off it, and a

149
00:08:59,559 --> 00:09:03,120
Speaker 7: load of tentacles everywhere through the region. So the question

150
00:09:03,240 --> 00:09:06,880
Speaker 7: is how do you destroy all of that once and

151
00:09:06,920 --> 00:09:09,960
Speaker 7: for all, And in doing so, can you destroy the

152
00:09:10,040 --> 00:09:12,920
Speaker 7: support for it as well? Because you can say that

153
00:09:13,040 --> 00:09:16,640
Speaker 7: you've decimated Harmas, but does something else just grow back

154
00:09:17,120 --> 00:09:19,840
Speaker 7: in its place. It's like a many headed hydra in

155
00:09:19,880 --> 00:09:24,480
Speaker 7: a way. So is the realistic goal to destroy Hamas

156
00:09:24,600 --> 00:09:27,960
Speaker 7: or is it simply to get hermas so denuded to

157
00:09:28,000 --> 00:09:31,360
Speaker 7: the point that it can never again mount the attack

158
00:09:31,440 --> 00:09:34,000
Speaker 7: of the kind that we saw just over a week

159
00:09:34,040 --> 00:09:37,719
Speaker 7: ago inside Israeli's soil. Of course, with the mass casualties

160
00:09:38,120 --> 00:09:41,000
Speaker 7: on the civilian side, is the goal ultimately to weaken

161
00:09:41,080 --> 00:09:42,840
Speaker 7: it to the point that it really is such a

162
00:09:42,840 --> 00:09:45,280
Speaker 7: shell of itself that an attack like that can never

163
00:09:45,320 --> 00:09:45,959
Speaker 7: happen again.

164
00:09:47,040 --> 00:09:52,320
Speaker 1: Will Palestinians get more access to food, to water, to supplies?

165
00:09:52,440 --> 00:09:56,200
Speaker 1: Pas in Biden even mentioned a safe zone the border

166
00:09:56,200 --> 00:10:00,120
Speaker 1: crossing it rafa. What is the situation for Palestinians.

167
00:10:00,000 --> 00:10:02,800
Speaker 7: It's still pretty desperate. We're hearing that the Rougher crossing

168
00:10:02,840 --> 00:10:06,360
Speaker 7: may open for a limited amount of time today. We've

169
00:10:06,360 --> 00:10:08,920
Speaker 7: had that, of course several times over the past few days,

170
00:10:08,920 --> 00:10:11,760
Speaker 7: and it's not really eventuated. And even if it does,

171
00:10:11,840 --> 00:10:14,199
Speaker 7: the US is cautioning like it may not be safe

172
00:10:14,240 --> 00:10:17,480
Speaker 7: to cross, even if there is an ability to do

173
00:10:17,520 --> 00:10:20,880
Speaker 7: so for several hours. So the options for Palestinians and

174
00:10:20,920 --> 00:10:24,480
Speaker 7: Gars will remain very limited. And also for sort of

175
00:10:24,720 --> 00:10:27,360
Speaker 7: Americans who are there, others who are trying to get out,

176
00:10:27,840 --> 00:10:30,440
Speaker 7: how can you leave even if you want to, So

177
00:10:30,480 --> 00:10:33,560
Speaker 7: that's one question. Also, the conditions inside Gars we know

178
00:10:34,120 --> 00:10:36,720
Speaker 7: are pretty terrible. We know in the hospitals in the north.

179
00:10:36,760 --> 00:10:39,000
Speaker 7: There are loads of people, tens of thousands of people

180
00:10:39,040 --> 00:10:42,080
Speaker 7: crowded into hospitals to seek sort of some sort of

181
00:10:42,120 --> 00:10:45,840
Speaker 7: safe haven in the event of a war. We know

182
00:10:45,880 --> 00:10:48,240
Speaker 7: that water did get turned back on to the southern

183
00:10:48,280 --> 00:10:52,120
Speaker 7: part of Gaza. That's possibly designed to coax people to

184
00:10:52,280 --> 00:10:54,240
Speaker 7: move south. If you go there, you will at least

185
00:10:54,240 --> 00:10:57,920
Speaker 7: have access to water. But right now there's no sort

186
00:10:57,920 --> 00:11:01,080
Speaker 7: of clear passageway for people to get or also for

187
00:11:01,160 --> 00:11:03,240
Speaker 7: stuff to get in, which includes food.

188
00:11:04,480 --> 00:11:07,680
Speaker 1: I use this phrase advisedly, but there does seem to

189
00:11:07,679 --> 00:11:12,200
Speaker 1: be a palpable sense of panic from the intensive shottle diplomacy.

190
00:11:12,880 --> 00:11:16,280
Speaker 1: What are the worries about a wider conflict currently?

191
00:11:16,840 --> 00:11:17,439
Speaker 6: Well, that's right.

192
00:11:17,480 --> 00:11:19,040
Speaker 7: I was trying to think back to the last time

193
00:11:19,080 --> 00:11:21,880
Speaker 7: a US Secretary of State had visited so many countries

194
00:11:21,920 --> 00:11:25,080
Speaker 7: in quick succession. We were talking about nine countries, some

195
00:11:25,120 --> 00:11:27,760
Speaker 7: of them twice in about four days. Going back to

196
00:11:27,880 --> 00:11:30,839
Speaker 7: Israel today, now talk the US President Johan Biden may

197
00:11:30,880 --> 00:11:34,720
Speaker 7: even make a lightning visit to Israel within days, And

198
00:11:34,840 --> 00:11:37,679
Speaker 7: all of that is conveying this growing sense that we're

199
00:11:37,760 --> 00:11:41,840
Speaker 7: hurtling towards something big and broad in the region and

200
00:11:41,880 --> 00:11:44,120
Speaker 7: this sort of effort to do several things. One is

201
00:11:44,200 --> 00:11:48,680
Speaker 7: possibly to persuade Israel simply to stave off a ground

202
00:11:48,760 --> 00:11:52,199
Speaker 7: war inside Gaza. The other is to talk to countries

203
00:11:52,240 --> 00:11:55,720
Speaker 7: in the region to try and negotiate things like hostage transfer,

204
00:11:55,880 --> 00:12:00,600
Speaker 7: safe passage of people from Gaza, humanitarian aid and so on.

205
00:12:00,920 --> 00:12:03,360
Speaker 7: And the third one, of course is to disuade around

206
00:12:03,800 --> 00:12:06,280
Speaker 7: and others from getting involved. That if a grand war

207
00:12:06,360 --> 00:12:09,439
Speaker 7: does kick off and you've got Hiszbala of course supported

208
00:12:09,440 --> 00:12:12,240
Speaker 7: by Iran to the north of Israel, and there's skirmish

209
00:12:12,320 --> 00:12:15,560
Speaker 7: is going on there obviously already. So the real sense

210
00:12:15,600 --> 00:12:18,920
Speaker 7: of concern in the US, also in Europe and in

211
00:12:18,960 --> 00:12:21,360
Speaker 7: the region is that this is going to at some

212
00:12:21,480 --> 00:12:24,800
Speaker 7: point draw in those other actors, and then where does

213
00:12:24,840 --> 00:12:25,600
Speaker 7: this war end?

214
00:12:25,920 --> 00:12:28,440
Speaker 1: Yeah, indeed, Roslin, thank you so much for being with

215
00:12:28,520 --> 00:12:30,800
Speaker 1: us this morning, Bloomberg's news director in Europe, the Middle

216
00:12:30,800 --> 00:12:34,400
Speaker 1: East and Africa, Roslyn Matheson, as we will watch the

217
00:12:34,520 --> 00:12:41,000
Speaker 1: Sectary of State Anthony Blincoln, expected to return to Israel today. Now,

218
00:12:41,040 --> 00:12:44,679
Speaker 1: the United States is planning to tighten measures against China

219
00:12:44,800 --> 00:12:49,000
Speaker 1: to restrict its access to advanced semiconductors and chip making gear.

220
00:12:49,120 --> 00:12:51,560
Speaker 1: This is an update to curbs that were announced a

221
00:12:51,640 --> 00:12:55,000
Speaker 1: year ago that were criticized for failing to get support

222
00:12:55,000 --> 00:12:58,120
Speaker 1: from Kili's, notably the Netherlands in Japan. So I want

223
00:12:58,200 --> 00:13:00,880
Speaker 1: to speak to our Bloomberg Chi and Economy and government.

224
00:13:01,000 --> 00:13:03,480
Speaker 1: Edited Jill Deesis this morning. Good morning, Jail, thanks for

225
00:13:03,520 --> 00:13:07,200
Speaker 1: being with us. How effective were the restrictions lost? Yeah,

226
00:13:07,280 --> 00:13:10,600
Speaker 1: I mean this is a significant point of tension between

227
00:13:10,640 --> 00:13:11,480
Speaker 1: the US and China.

228
00:13:12,520 --> 00:13:15,080
Speaker 9: Yes, Caroline, well, I think, you know, it's a pretty

229
00:13:15,080 --> 00:13:17,960
Speaker 9: complicated topic for some reasons. I'm sure we'll get into

230
00:13:18,080 --> 00:13:20,400
Speaker 9: in a few moments, but the short of it is that,

231
00:13:20,440 --> 00:13:24,199
Speaker 9: as you just said, you know, those restrictions were unveiled

232
00:13:24,320 --> 00:13:27,800
Speaker 9: before the US got the support of key allies, including

233
00:13:27,840 --> 00:13:31,800
Speaker 9: the Netherlands and Japan. That essentially allowed equipment companies in

234
00:13:31,840 --> 00:13:34,880
Speaker 9: those countries to continue selling advanced gear to Chinese customers.

235
00:13:34,880 --> 00:13:37,360
Speaker 9: It's part of it. But I think what ultimately they're

236
00:13:37,400 --> 00:13:41,360
Speaker 9: trying to accomplish with this proposed set of you know,

237
00:13:41,400 --> 00:13:44,560
Speaker 9: refining and closing some loopholes, is looking to strengthen some

238
00:13:44,600 --> 00:13:47,840
Speaker 9: controls on selling graphics chips for AI applications. That's a

239
00:13:47,840 --> 00:13:50,040
Speaker 9: big part of it. They also want to try to

240
00:13:50,040 --> 00:13:52,640
Speaker 9: figure out how they can, you know, restrict additional advanced

241
00:13:52,679 --> 00:13:55,560
Speaker 9: chip makeing equipment to Chinese firms through other ways. And

242
00:13:55,320 --> 00:13:58,040
Speaker 9: they also just want to impose additional checks and Chinese

243
00:13:58,080 --> 00:14:00,880
Speaker 9: firms that are trying to evade export restrictions by routing

244
00:14:00,880 --> 00:14:05,080
Speaker 9: shipments through other nations. So ideally what the US would

245
00:14:05,120 --> 00:14:08,400
Speaker 9: be looking at is maybe adding design firms in China

246
00:14:08,440 --> 00:14:10,800
Speaker 9: to a trade restriction list, and so that trying to

247
00:14:10,880 --> 00:14:12,840
Speaker 9: trying to show up things there. But yes, I think ultimately,

248
00:14:12,920 --> 00:14:16,240
Speaker 9: I think it's really just about trying to find ways

249
00:14:16,280 --> 00:14:20,280
Speaker 9: to stop these Chinese companies from routing things through other

250
00:14:20,360 --> 00:14:25,040
Speaker 9: countries or ultimately using things for applications in advanced tech

251
00:14:25,080 --> 00:14:27,160
Speaker 9: that the US is reluctant to a lot of them

252
00:14:27,200 --> 00:14:27,400
Speaker 9: to do.

253
00:14:27,480 --> 00:14:30,080
Speaker 1: So, okay, so trying to tighten not the rules, close

254
00:14:30,120 --> 00:14:32,280
Speaker 1: off the loopholes. I mean there have been, though, in

255
00:14:32,320 --> 00:14:36,360
Speaker 1: the meantime, quite notable successes for China in developing its

256
00:14:36,400 --> 00:14:38,160
Speaker 1: own domestic capabilities.

257
00:14:38,280 --> 00:14:40,720
Speaker 9: Right, Yes, I'm glad you brought that up, because I

258
00:14:40,760 --> 00:14:44,120
Speaker 9: think that that's ultimately what makes this the effectiveness of

259
00:14:44,160 --> 00:14:46,480
Speaker 9: those rules last year such an open question. So the

260
00:14:46,480 --> 00:14:50,200
Speaker 9: big one that made a huge splash was just a

261
00:14:50,240 --> 00:14:54,800
Speaker 9: few weeks ago when Huawei, the major Chinese telecoms tech

262
00:14:55,600 --> 00:14:58,720
Speaker 9: maker that the US has been imposing restrictions on since

263
00:14:58,720 --> 00:15:00,640
Speaker 9: twenty nineteen as part of, you know, sort of the

264
00:15:01,080 --> 00:15:05,240
Speaker 9: poster child really for those big, big US China tensions

265
00:15:05,440 --> 00:15:07,440
Speaker 9: during during the trade war, as they were trying to

266
00:15:07,440 --> 00:15:11,479
Speaker 9: short up these things, they had this pretty massive breakthrough

267
00:15:11,560 --> 00:15:14,480
Speaker 9: with a phone we tore down actually just a few

268
00:15:14,480 --> 00:15:18,360
Speaker 9: weeks ago that showed they produced this chip by a

269
00:15:18,440 --> 00:15:21,960
Speaker 9: Chinese company that developed these manufacturing capabilities that the US

270
00:15:22,000 --> 00:15:25,640
Speaker 9: thought were well beyond where they thought that the company

271
00:15:25,680 --> 00:15:28,120
Speaker 9: had stopped advancing. So their ability to sort of create

272
00:15:28,480 --> 00:15:31,720
Speaker 9: this phone that had really really competitive tech within the

273
00:15:31,800 --> 00:15:33,640
Speaker 9: Chinese consumer market, I think has raised a lot of

274
00:15:33,720 --> 00:15:37,640
Speaker 9: questions about, you know, how advanced China is able to get.

275
00:15:37,680 --> 00:15:40,240
Speaker 9: The US is still investigating that phone and trying to

276
00:15:40,240 --> 00:15:43,400
Speaker 9: figure out exactly where things happened there, But I think

277
00:15:43,400 --> 00:15:45,400
Speaker 9: that that kind of came as a surprise and ultimately

278
00:15:45,520 --> 00:15:47,920
Speaker 9: is facilitating some of these new restriction announcements.

279
00:15:48,840 --> 00:15:50,840
Speaker 1: This has been big day break. You up your morning

280
00:15:50,880 --> 00:15:53,600
Speaker 1: brief on the stories making news for London to Wall

281
00:15:53,600 --> 00:15:57,280
Speaker 1: Street and beyond for us on your podcast feed every

282
00:15:57,320 --> 00:16:01,240
Speaker 1: morning on Apple, Spotify, and anywhere else you get your podcasts.

283
00:16:01,960 --> 00:16:05,440
Speaker 1: You can also listen live each morning on London Dab Radio,

284
00:16:05,640 --> 00:16:09,320
Speaker 1: the Bloomberg Business app, and Bloomberg dot Com. Our flagship

285
00:16:09,360 --> 00:16:12,960
Speaker 1: New York station, is also available on your Amazon Alexa device.

286
00:16:13,360 --> 00:16:17,640
Speaker 1: Just say Alexa play Bloomberg eleven point thirty. I'm calling Hepga.

287
00:16:17,760 --> 00:16:20,040
Speaker 1: Join us again tomorrow morning for all the news you

288
00:16:20,080 --> 00:16:22,960
Speaker 1: need to start your day right here on Bloomberg Daybreak

289
00:16:23,000 --> 00:16:26,440
Speaker 1: Europe