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Speaker 1: Good morning. It's Tuesday, the fifth of September here in London.

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Speaker 1: This is the Bloomberg Daybacurate podcast that I'm Caroline Hipki and.

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Speaker 2: I'm Stephen Carroll. Coming up today, Bloomberg Economics says China's

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Speaker 2: economy may never definitively surpass the US as the developer country.

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Speaker 2: Garden makes a last minute debt repayment.

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Speaker 1: Bosses and employees wrestle with the one point three trillion

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Speaker 1: dollar return to office dilemma.

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Speaker 2: And we bring you the inside story of the deal

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Speaker 2: making Abu Dabi Sheikh who oversees a one and a

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Speaker 2: half trillion dollar empire.

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Speaker 1: Let's stop with a roundup of our top stories.

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Speaker 2: China may never eclipse the US as the world's largest economy,

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Speaker 2: according to Bloomberg Economics. Its calculations show China's GDP may

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Speaker 2: briefly surpass that of the US in twenty forty, but

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Speaker 2: even then it will happen only by a small margin

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Speaker 2: before falling back behind. Before the pandemic, the expectation was

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Speaker 2: that China would take and hold pole position as early

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Speaker 2: the start of the next decade. The research reflects decisions

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Speaker 2: already being made by investors. Eddie Lowe's CIO at Maybank

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Speaker 2: Group Wealth Management, says he's downgraded his view of China.

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Speaker 3: The very constrame policy responses actually over not just past month,

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Speaker 3: but actually over the past weelf month, coupled with the

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Speaker 3: very damage confidence being consumers and business, suggests that it

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Speaker 3: will take time to repair.

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Speaker 2: Eddie Lowe's comments come as the Mercedes CEO or La Callenius,

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Speaker 2: has also walked back his previously bullish view on China,

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Speaker 2: telling Bloomberg that they're now taking a more cautious stance

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Speaker 2: on the country.

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Speaker 1: Country Garden has averted default on its dollar debt by

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Speaker 1: paying coupons on two bonds within their grace periods. The

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Speaker 1: Chinese builder needed to pay a combined twenty two and

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Speaker 1: a half million dollars in interest by Wednesday. China's housing

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Speaker 1: crisis has engulfed the country's private developers, producing record waves

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Speaker 1: of faults and leaving a shrinking group of survivors. Bloomberg's

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Speaker 1: data shows that thirty four of China's top fifty private

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Speaker 1: sected developers by dollar bond issuance have already suffered delinquencies

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Speaker 1: on offshore debts.

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Speaker 2: Bloomberg has learned that CVC Capital Partners is nearing a

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Speaker 2: deal to buy infrastructure investor DIFF Capital Partners ahead of

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Speaker 2: a potential listing. The European private equity firm could announce

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Speaker 2: a deal as soon as Tuesday, according to sources. Infrastructure

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Speaker 2: has been one of the hottest areas of deal making

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Speaker 2: over the past year, and DIFF Bait in the Netherlands

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Speaker 2: has around sixteen billion euros of assets under management according

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Speaker 2: to its website.

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Speaker 1: Bloomberg understands that the UK will announce new planning regulations

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Speaker 1: that will lift an effective ban on new offshore wind

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Speaker 1: farms this week. Bloomberg's U and Pots reports.

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Speaker 4: It's a controversy that's been blowing for years, but Bloomberg

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Speaker 4: has learned the government will today effectively end the ban

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Speaker 4: on onshore wind developments. A consultation will be launched on

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Speaker 4: giving local communities power to greet a new projects after

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Speaker 4: a nine month delay on the decision. The Prime Minister's

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Speaker 4: decision to lift the effective fan on new onshore wind

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Speaker 4: farms comes after he previously caved into rebel conservative MPs

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Speaker 4: on the issue last year. Soon I said he wanted

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Speaker 4: to pursue offshore wind due to the distress and disruption

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Speaker 4: onshore wind farms can cause the local residents. The decision

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Speaker 4: to allow more onshore wind comes as the UK faces

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Speaker 4: up to multi billion dollar green tax subsidies in both

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Speaker 4: the US and the EU. In London immune pots Bloomberg

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Speaker 4: day Break Europe, the.

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Speaker 2: UK has one of the highest rates of remote work

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Speaker 2: in the world. The average British worker spends one and

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Speaker 2: a half days at home every week. A Bloomberg investigation

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Speaker 2: into how the world returns to the office found Europe's

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Speaker 2: better public transport has made hybrid models more viable. Of

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Speaker 2: the US companies have some of the strictest work from

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Speaker 2: home policies. America lags far behind the rest of the

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Speaker 2: world and getting staff to come back to the office.

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Speaker 1: More domestic news here. The government is coming under growing

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Speaker 1: criticism for its handling of the Create Schools crisis. Bloomberg

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Speaker 1: reported that Education Secretary Gillian Keegan was on holiday in

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Speaker 1: Spain while the problem unfolded. She was caught in an

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Speaker 1: unguarded moment wearing a microphone after an interview with ITV.

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Speaker 1: Does anyone ever say you know what you've done? A

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Speaker 1: good job because everyone else has sat on there and

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Speaker 1: done nothing.

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Speaker 4: No signs of that.

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Speaker 1: Keegan later apologized for the language. Prime Minister Ishisunac was

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Speaker 1: also forced to deny personal responsibility for the de Barkle

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Speaker 1: following claims that he approved cuts to the schools building

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Speaker 1: program when he was chancellor.

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Speaker 2: Elon Musk is blaming the Anti Defamation League for the

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Speaker 2: slump and advertising revenue at his social media platform X

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Speaker 2: Bloomberg's head Baxter has the story.

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Speaker 5: Ad sales are still down sixty percent, Musk posting primarily

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Speaker 5: due to pressure and advertisers mounted by ADL. He in

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Speaker 5: a series of post says it has been quote trying

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Speaker 5: to kill the platform. She bought it, falsely accusing it

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Speaker 5: and him of being Ali Schamitic. Musk says it is

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Speaker 5: a pro free speech platform, but against Ali Semitism of

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Speaker 5: any kind. He says he is as well. He says

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Speaker 5: legal action is an option in San Francisco. I'm at

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Speaker 5: Baxter Bloomberg Day Break Europe.

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Speaker 2: Well after Gillian Keegan landed herself in some hot water

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Speaker 2: over those hot mic moments yesterday at slightly different political

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Speaker 2: fund being made. I supposed to a politician on the internet.

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Speaker 2: The Chancellor Olaf Schultz in Germany had a jogging accident

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Speaker 2: over the week Andrews left him with some cuts and

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Speaker 2: bruises and he's wearing an eye patch as a result

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Speaker 2: of that. But he released, ahead of appearing in any

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Speaker 2: other public forum, a photo of himself, an official portrait

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Speaker 2: photo of himself wearing his eyepatch, with the message on

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Speaker 2: social media, can't wait to see the memes. Memes they

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Speaker 2: did come.

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Speaker 1: Yeslue pirate memes in particular. Obviously, Look at that is

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Speaker 1: what it takes to be a politician these days. You

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Speaker 1: have to get out in front of the story before

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Speaker 1: the sort of story grabs you by the social media

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Speaker 1: scruff of the neck.

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Speaker 2: Yeah, I mean, look, it's an interesting political communication strategy

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Speaker 2: to say, you know, before there's any sort of questions

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Speaker 2: about what happened and howazi you know, he released the

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Speaker 2: photo and it's.

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Speaker 1: A particularly nice photo. Must I must say, Oh Love

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Speaker 1: Schultz is nicely shot, you know, I.

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Speaker 2: Mean, very very visibly was hurt like he must taken

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Speaker 2: a terrible stumble by the looks of things. But he

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Speaker 2: said to be fine and apparently we'll make full recovery

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Speaker 2: from his injured eye as well.

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Speaker 5: Yeah.

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Speaker 1: No, I think the Jillian Keegan moment has gained more

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Speaker 1: visibility here in the UK the Education Secretary, I mean,

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Speaker 1: schools are going back this week. This issue around the

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Speaker 1: use of a particular type of concrete in school buildings

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Speaker 1: but in a lot of public buildings between the nineteen

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Speaker 1: fifties and nineteen nineties that have not been replaced that

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Speaker 1: could be dangerous. Is an enormous issue for government that

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Speaker 1: was really hoping, you know, to put its best foot forward.

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Speaker 1: It's now been mud in this controversy. She didn't say

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Speaker 1: who she was blaming for sort of sitting around and

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Speaker 1: not dealing with the problem. Was it former Conservative government

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Speaker 1: she was talking about? Was it the labor government even

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Speaker 1: before that in the twenty that left off is in

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Speaker 1: twenty ten. She wasn't clear.

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Speaker 2: Yeah, but certainly something that I think has taken over

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Speaker 2: somewhat of a narrative on that story as well. Let's

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Speaker 2: turn to the news out of China this morning. Though

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Speaker 2: the troubled property developer Country Garden seems to have avoided

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Speaker 2: a default, at least for now. It's told its shareholders

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Speaker 2: that it has paid the interest due on dollar bonds

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Speaker 2: before the grace period expired. Missing a payment on these

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Speaker 2: bonds has sparked a massive route in the company's shares

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Speaker 2: just a few weeks ago. Bloomberg's China Credit editor Kevin

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Speaker 2: Kingsbury joins us now for more on this story. Kevin,

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Speaker 2: great to have you with us. So Country Garden has

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Speaker 2: made these payments, what does it mean for the company's future.

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Speaker 6: So it's just the kind of the tip of the

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Speaker 6: iceberg as far as the amount of debt that it

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Speaker 6: has coming due to interest payments on through the end

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Speaker 6: of the year, nearly two billion dollars worth of various

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Speaker 6: obligations that it could be liable for, depending upon if

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Speaker 6: some bonds and their holders demand early repayments, which could

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Speaker 6: happen on several notes later this month. So we've gotten

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Speaker 6: these twenty two point five million dollars paid in the interest.

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Speaker 6: So it's definitely a relief for the market. But we

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Speaker 6: just have to see what happens with some of these

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Speaker 6: near turn payments coming up in the next few weeks,

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Speaker 6: because it is far out of the woods for Country.

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Speaker 1: Garden, Okay, far from being out of the words yes

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Speaker 1: understood more broadly, though, we're keeping a close eye on

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Speaker 1: China's property sector. Tell us about the recent support measures

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Speaker 1: that have been announced over the last couple of weeks.

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Speaker 1: You know, they've been piecemeal. What do they add up to.

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Speaker 6: Well, ultimately the government is hoping that they add up

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Speaker 6: to increased demand for new homes. In August, they fell

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Speaker 6: about a third year over year, is the third straight

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Speaker 6: month of big declines after some growth for the first

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Speaker 6: time since twenty twenty one earlier this year. So those

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Speaker 6: earlier games they sparked hope that the bottom was finally

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Speaker 6: in for Chinese new homes, but it appears in the

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Speaker 6: last few months that's not the case. And so we've

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Speaker 6: had these new round of measures, including last week cutting

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Speaker 6: the down payment requirements for both first time and second homeowners,

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Speaker 6: and it seems as though the initial reaction has been positive.

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Speaker 6: Beijing and Shanghai saw some significant increases in both existing

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Speaker 6: and new home sales this past weekend after the mortgage

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Speaker 6: rules were rolled out, So there is some hope that

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Speaker 6: we're finally getting to a point where some of these

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Speaker 6: measures that have been talked about that are starting to

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Speaker 6: actually come to fruition are going to help stoke some

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Speaker 6: demand in the housing market.

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Speaker 2: The property slump has been a key element of the

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Speaker 2: latest forecast that we've had from Boomberg Economics that we're

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Speaker 2: also reporting on today, which now says the Chinese economy

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Speaker 2: will not eclipse that of the US, So a shift

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Speaker 2: from its previous forecast. How significant is that?

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Speaker 6: Well, certainly, the race between the US and China as

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Speaker 6: to who's going to have the because economy has been

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Speaker 6: something that's been talking about for a good number of

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Speaker 6: years now. But now that China's population has seemingly peaked out,

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Speaker 6: the number of people fell slightly in twenty twenty two,

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Speaker 6: and it just seems as though that trend is going

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Speaker 6: to accelerate. Raises the question certainly as to whether the

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Speaker 6: perb capita economic activity in China can get closer to

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Speaker 6: matching the US to be able to the overall economy

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Speaker 6: eclipsing in the US in size.

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Speaker 1: Yeah, and so for others when we're thinking about I mean,

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Speaker 1: it is a huge shift, isn't it in thinking because

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Speaker 1: for for a long time, there was this idea that

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Speaker 1: China was accelerating, surging ahead, and would overtake the US.

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Speaker 1: So a reversal of that idea is very significant. What

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Speaker 1: does a slowing China mean for the rest of the world?

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Speaker 4: Now, do you think sure?

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Speaker 6: It certainly means as though the global economy is going

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Speaker 6: to diversify more beyond the US and China, places like India,

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Speaker 6: places like Africa. Folks that already have been moving more

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Speaker 6: into these markets in recent years, and so long as

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Speaker 6: the governments are allowing foreign capital to flow into these markets,

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Speaker 6: you're going to see increased activity from outside of their

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Speaker 6: own borders to help grow those those economies, to make

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Speaker 6: them manufacturing hubs. For example, things that we've seen in

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Speaker 6: places perhaps like Vietnam or Thailand, where some of the

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Speaker 6: Western manufacturers have been moving some things out of China

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Speaker 6: and into other markets in Southeast Asia for example.

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Speaker 2: Okay, Kevin, thank you very much, Ben Brooks, China Credit

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Speaker 2: editor Kevin Kingsbury.

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Speaker 1: They're reporting now as oil wealth flows to all corners

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Speaker 1: of the globe, from mega mergers to major sports acquisitions,

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Speaker 1: a key member of Abu Dhabi's ruling family is standing

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Speaker 1: out as one of the world's most influential deal makers.

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Speaker 1: This is a major feature that we have on the

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Speaker 1: Blueberg terminal today and now from Dubai on Middle East Economics,

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Speaker 1: reporter Aber Abu AmAm joins us to discuss the story.

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Speaker 1: Good morning, Thank you so much for your time. Just firstly,

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Speaker 1: who is Sheikh to Noon and what is the extent

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Speaker 1: of his reach?

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Speaker 7: Yeah, Hi, good morning Caroline. We discuss the growing influence

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Speaker 7: of Shikun who has come to prominence in the last

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Speaker 7: few years. But I mean growing up here, you know

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Speaker 7: people heard about Sea. You must have heard about the

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Speaker 7: Nahyan family. He's one of mb z's brothers. He has

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Speaker 7: a massive array of positions under his umbrella.

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Speaker 3: So some of his.

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Speaker 7: Positions include he is the chairman of the biggest sovereign

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Speaker 7: wealth fund in Abu Dhabi, Adia. He also chairs Royal

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Speaker 7: Group International Holding Company ADQ, another sovereign wealth fund, and

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Speaker 7: the biggest bank in the UAE, first albud w Bank.

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Speaker 7: So he definitely has again a massive sort of influence

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Speaker 7: when it comes to the financial umbrella of the country.

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Speaker 7: And he's grown in this and this influence over the

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Speaker 7: past few years because of the deals that he has

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Speaker 7: clustered with their businessmen and other companies and other countries

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Speaker 7: even and I think one of the biggest titles that

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Speaker 7: he holds is he's the National Security Advisor to the UAE,

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Speaker 7: so he sort of mixes between foreign policy and business,

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Speaker 7: which has gained him the status of being sort of

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Speaker 7: the de facto business influencer in the UAE.

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Speaker 2: What kind of deals were his companies in charge of recently?

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Speaker 7: So there are plenty, right, So you know, we can

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Speaker 7: start with some of the deals that he wanted to

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Speaker 7: go through earlier this year. Those considered buying Standard chartered

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Speaker 7: the Baizard at the start this year. They were ultimately unsuccessful,

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Speaker 7: but they sort of highlight the scale of his ambitions.

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Speaker 7: So some of the deals that did go through include

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Speaker 7: investments in TikTok, which is on by Dance, Also some

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Speaker 7: deals where he wanted to where he wanted to invest

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Speaker 7: billions of dollars into neighboring economies such as Turkey and Egypt,

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Speaker 7: which really depend on golf money and have been depending

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Speaker 7: on golf money over the past few years. So he's

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Speaker 7: also had an agreement to bankrolled Mestra, you know, Mestra's

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Speaker 7: six point eight billion dollar vehicle and takeovers of multiple

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Speaker 7: multiple entities around the region.

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Speaker 1: Yeah, I suppose the risks though, I mean, we can

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Speaker 1: see the ambition of these deals. What are the key

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Speaker 1: risks facing his businesses?

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Speaker 7: Well, look, I mean the UAE and other golf countries

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Speaker 7: have been super invested in US tocks and US deals

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Speaker 7: generally over the past I would say decade for the UEE,

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Speaker 7: it's been a major asset. US deals have been major

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Speaker 7: in the UAE's portfolio. These have become have started to

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Speaker 7: become more complex for the region. For golf entities, the

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Speaker 7: broad sort of geographic scope will continue to attract FDI.

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Speaker 7: But there are concerns about potential information flow to China,

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Speaker 7: and that comes after the UAE and Saudi Arabia from

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Speaker 7: the Gulf region joined Bricks about two weeks ago now,

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Speaker 7: and certainly the UAE is starting to look at more friends,

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Speaker 7: other friends than the US, including China and countries in Africa.

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Speaker 7: But the UAE says, listen, this flow is not does

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Speaker 7: not mean that we're going to cut ties with the

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Speaker 7: US or with the West. It just means that we're

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Speaker 7: expanding our horizon, We're expanding where money comes from. But

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Speaker 7: those are certainly things that the US would be would

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Speaker 7: be concerned about. Other things include that the UAE has

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Speaker 7: been included in the fought IF gray list two years

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Speaker 7: ago at this point or one and a half years ago,

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Speaker 7: so that you know that includes part of the risk.

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Speaker 2: This is Bloomberg Daybreak Europe, your morning brief on the

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