Speaker 1: Good morning.
Speaker 2: It's Monday, the twenty fifth of September here in London.
Speaker 2: This is the Bloomberg Day Recurate podcast.
Speaker 1: I'm Caroline Hepkin.
Speaker 3: And I'm Stephen Carroll. Coming up today, the EU's top
Speaker 3: trade negotiator, warrens China it will be more assertive.
Speaker 2: Anga grows as Rishi Sunat considers scrapping part of HS.
Speaker 3: Two, And why Europe's unity on sending weapons to Ukraine
Speaker 3: may be in for another big test.
Speaker 1: Let's start with a found up of our top stories.
Speaker 3: The European Union's chief trade negotiator is Warren China that
Speaker 3: the EU will be more forceful and upholding fair competition
Speaker 3: and defending its interests. Valdas Dombrovskis says the lack of
Speaker 3: a level playing field and wider geopolitical shifts have forced
Speaker 3: the BLOCK to become more assertive.
Speaker 4: Broadening access to China's market for foreign companies and maintaining
Speaker 4: a stable business environment is necessary to ensure fair and
Speaker 4: mutually beneficient trade relationships.
Speaker 3: Don Brovski has made the comments on a trip to China,
Speaker 3: where he's meeting officials including Vice Premier Hurley Fang. The
Speaker 3: visit comes just days after the European Commission announced an
Speaker 3: anti subsidy investigation into Chinese electric vehicles.
Speaker 2: Europe's main auto lobby group is urging policymakers to delay
Speaker 2: post Brexit tariffs on electric vehicles. From next year, eves
Speaker 2: traded between the UK and the EU will attract a
Speaker 2: ten percent tariff if less than forty five percent of
Speaker 2: their value comes from the block. The European Automobile Manufacturers
Speaker 2: Association wants the EU Commission to push back the charge.
Speaker 2: Failure to do so could reduce production by close to
Speaker 2: half a million cars over three years.
Speaker 3: Bloomberg goodistounds that Italian banks will be able to avoid
Speaker 3: paying a controversial windfall tax introduced last month if they
Speaker 3: set aside additional capital reserves. The proposed amendment also changes
Speaker 3: the basis for calculating the levee to a percentage of
Speaker 3: the lender's risk weighted assets on an individual basis, instead
Speaker 3: of their total assets. The new draft represents a compromise
Speaker 3: by Jo Maloni's government following a slump in Italian bank
Speaker 3: stocks and criticism from the ECB since the measure was
Speaker 3: first announced in August.
Speaker 2: Former Conservative Prime Minister's business and university leaders are warning
Speaker 2: Rishi Sunac against derailing HS two, the one hundred billion
Speaker 2: pound rail project. Cabinet Minister Grant Shapp says that it
Speaker 2: would be irresponsible to plow money into the infrastructure scheme
Speaker 2: as costs saw.
Speaker 5: We saw not just with HS two, but with our
Speaker 5: pace of change with net zero. That just because the
Speaker 5: media says this must be done, just because some people
Speaker 5: will say, you know, these are the popular things to do,
Speaker 5: He's prepared to do difficult things.
Speaker 2: Shapps's refusal to deny the plans added to speculation that
Speaker 2: the government would ditch its own flagship infrastructure project. It
Speaker 2: comes as Prime Minister as she Sunac seeks to radically
Speaker 2: research his premiership as his popularity polls at an all
Speaker 2: time low.
Speaker 3: In the United States, Republican hirdliner Matt Gates says he's
Speaker 3: ready to shut down the US government over budget took.
Speaker 3: The party are at odds internally on a government funding plan.
Speaker 3: In the House of Representatives, Representative Garrett Graves, as Gates
Speaker 3: has pushed to tie border policies into funding is counterproductive.
Speaker 6: If you want to empower Senator Schumer, if you want
Speaker 6: to empower Joe Biden, then what you do is you
Speaker 6: let government shut down. You don't pursue a continue resolution,
Speaker 6: you don't pass the appropriations bills. That is the liberal solution.
Speaker 3: Graves is an ally of the Republican Leader of the House,
Speaker 3: Kevin McCarthy, who struggle to control his party that holds
Speaker 3: a single digit majority in the lower House. McCarthy has
Speaker 3: until the end of the week to find a solution
Speaker 3: or the government will have no funding.
Speaker 2: Meanwhile, Hollywood studios and screenwriters have reached a tentative deal
Speaker 2: to end a month's long strike. The Writers Guild of America,
Speaker 2: which represents Hollywood movie and TV script writers, walked out
Speaker 2: in May over pay and protections from the use of
Speaker 2: artificial intelligence. The industry has been at a virtual standstill
Speaker 2: in recent months, with actors also on strikes since July
Speaker 2: citing many of the same demands.
Speaker 3: A NASA capsule containing chunks of an asteroid that may
Speaker 3: hold clues to the development of our solar system has
Speaker 3: landed in the Utah Desert after a seven year space mission.
Speaker 3: The Osiris REX mission was launched in twenty sixteen and
Speaker 3: scooped up a large sample of rocks from a near
Speaker 3: Earth asteroid. Three years ago, cosmochemist doctor Natalie Starky says
Speaker 3: it marks the first mission of its kind.
Speaker 7: We don't have any other samples that can tell us
Speaker 7: about those times.
Speaker 8: And the important thing is is.
Speaker 7: They're pristine because they haven't been through atmosphere entry. They're
Speaker 7: going to be looked after in this capsule that's come
Speaker 7: back from the spacecraft, and they're just the perfect samples
Speaker 7: that we could hope for.
Speaker 3: Doctor Natalie Starky and others believe the rocks could also
Speaker 3: help inform future missions to asteroids. The samples have been
Speaker 3: taken to NASA's Johnson's Space Center and could be opened tomorrow.
Speaker 3: Carl and Alexi user systems.
Speaker 1: I must have been, I am. Yeah, so we've got
Speaker 1: at least two in the house.
Speaker 3: I don't consider myself a luddie, but it's one of
Speaker 3: the things, one of the technologies that I have not adapted.
Speaker 3: I don't use voice assistance anyway.
Speaker 9: Yeah.
Speaker 3: I don't know whether it's paranoia over what it's being
Speaker 3: listened to, or that I just don't see a use
Speaker 3: you necessarily.
Speaker 1: No, I can understand that. No, and I do.
Speaker 2: And I also see really, given the leaps in artificial intelligence,
Speaker 2: why Bloomberg opiniconmist Dave Lee has written a story about
Speaker 2: what the point of Alexa actually is. I mean, I
Speaker 2: must admit I use it for very basic things like
Speaker 2: a timer. And Dave Lee is talking to the boss
Speaker 2: of Amazon's Alexa unit about actually what more this device
Speaker 2: is meant to deliver. I thought it was interesting that
Speaker 2: talking about maybe it becoming a subscription service.
Speaker 3: Yeah, exactly. So Dave Limp is actually leaving Amazon at
Speaker 3: the end of the year. So this is sort of
Speaker 3: an interview about where the technology is going next. Very
Speaker 3: much worth reading from our Bloomberg opinion columns. Davely this morning.
Speaker 2: Okay, let's turn our attention then to the big picture.
Speaker 2: To the eused chief Trade Negotiation says that the Block
Speaker 2: will become more assertive when it comes to trade with China.
Speaker 2: Veldus Dobrovskis says that China's lack of reciprocity means that
Speaker 2: the twenty seven nation Block wants to reset the relationship. This,
Speaker 2: of course after the EU launched an anti subsidy probe
Speaker 2: into Chinese electric vehicles. Joining US now to discuss this,
Speaker 2: but in both China and government Editor Jill de Sis
Speaker 2: Good morning, Jill Dombroskis is in China. Then for these
Speaker 2: high level trade negotiations and talks, including with the Vice
Speaker 2: Premier who her live Fung, the EU is clearly concerned
Speaker 2: about trade with China.
Speaker 10: Hey, Carolin, Yes, I think that's very easy to say that.
Speaker 10: I mean, look, this is an incredibly important trading relationship.
Speaker 10: I think the EU is a block is one of
Speaker 10: the largest trading partners for China. This is a relationship
Speaker 10: that involves some nine hundred billion dollars more in bilateral commerce.
Speaker 10: So yes, I think there's there's quite a lot of
Speaker 10: concerns here, especially if you look at the trend over
Speaker 10: the last couple of years. The China is exporting more
Speaker 10: to the to the EU, but imports aren't really keeping
Speaker 10: pace there. So I think that there's a lot of
Speaker 10: concern within the EU just kind of about how the
Speaker 10: dependency looks, what they can do to kind of de
Speaker 10: risk and ring fence some of their operations, and that's
Speaker 10: what we saw spill over into for example, this whole
Speaker 10: Chinese EV probe here. I think that that's you know,
Speaker 10: sort of a this this consequence of the push that
Speaker 10: Chinese electric vehicle makers have made into the European market,
Speaker 10: and then what that actually means for a lot of
Speaker 10: EU companies as well. And so all of this is
Speaker 10: kind of the backdrop to Brovkas visiting China over the
Speaker 10: last couple of days and kind of working through some
Speaker 10: of these high level talks.
Speaker 3: What sort of sense do we have of their reception
Speaker 3: these remarks might get given what China has said previously
Speaker 3: about some of the actions like that ev investigation that
Speaker 3: the EU has launched.
Speaker 10: Yes, well, I think that at this point, you know,
Speaker 10: easy to see that that China has obviously not been
Speaker 10: very happy with a lot of the eaves regressive remarks,
Speaker 10: this idea of them taking a stance, and we haven't
Speaker 10: actually had official reaction to this most recent speech Dombrovskis
Speaker 10: gave this morning. This was a speech, according to prepared remarks,
Speaker 10: that he give to Shanghai University in Beijing. But we
Speaker 10: know that he's been meeting a lot with Chinese officials
Speaker 10: over the past couple of days. He's actually supposed to
Speaker 10: be in this meeting with Holy Fung Vice premiere at
Speaker 10: this moment. So I mean, you know, this is a
Speaker 10: very careful and considered relationship. I'm sure we'll get something
Speaker 10: more public out of China right now. But yes, they
Speaker 10: have not been happy about that EV probe. There's a
Speaker 10: lot of sense within China that this is sort of
Speaker 10: unfairly targeting Beijing rather than being something that's a little
Speaker 10: bit more you know, sensible and maybe not as politically charged.
Speaker 10: But yes, you can you can see just from those
Speaker 10: types of remarks in the past over the CV probe,
Speaker 10: how how charged this really has become.
Speaker 2: Yeah, absolutely so, then what about the next step, the
Speaker 2: idea of somewhat between Presidents Jimping and the EU's at
Speaker 2: Stavondale later this year.
Speaker 10: I think that we're still waiting to see what form
Speaker 10: that might ultimately take and when exactly they would meet.
Speaker 10: I will say that what's happening right now, and so
Speaker 10: the entire reason why Broskis is currently in China is
Speaker 10: it's part of this this high level economic and trade dialogue. So,
Speaker 10: I mean, this is one of the most important EU
Speaker 10: China related summits it's happening this year. So I think
Speaker 10: that what that does is even if you've got these
Speaker 10: you know, quite strong comments that are coming from the
Speaker 10: EU's trade chief at this speech, you know, I mean,
Speaker 10: there's a certain element of this that of course is
Speaker 10: strategic and calculated, and I think the fact that he's
Speaker 10: having some of these closed door meetings with really really
Speaker 10: high level officials kind of indicates that there is still
Speaker 10: a desire to figure out this relationship, what things ultimately
Speaker 10: look like. I mean, look, just over the past couple
Speaker 10: of years, we've moved away from really strong language on decoupling,
Speaker 10: for example, to now de risking and sort of working
Speaker 10: through this relationship. So sure, I think that once we
Speaker 10: get away from this, we've got a press conference from
Speaker 10: them broskis expected tomorrow, maybe we'll get a sense of
Speaker 10: what there's even higher level meetings between Banderly and she
Speaker 10: Jinping ultimately look like.
Speaker 3: Okay, Jill Lisas, our China Government editor, thank you very
Speaker 3: much for joining us with the latest on that story.
Speaker 3: As Valderston Broxfast continues his visit to China.
Speaker 2: Now we want to bring you a story from Slovakia next.
Speaker 2: The former Prime Minister Robert Fico could seal an unlikely
Speaker 2: comeback in elections this weekend, but he wants to end
Speaker 2: military aid to Ukraine, which could further test European unity
Speaker 2: on the issue. Our Eastern Europe Economy editor, Andrea Juditch
Speaker 2: is joining us now for more on this. Good morning, Andrea,
Speaker 2: thanks for your time. What does the victory potentially mean
Speaker 2: then for Europe's political landscape?
Speaker 8: Good morning.
Speaker 9: His possible victory will be a huge test for Europe
Speaker 9: and exter United State, for Ukraine and against Russia when
Speaker 9: it comes to sanctions and weapons deliveries.
Speaker 3: How could a return to power change the broader stance
Speaker 3: that Europe has towards Ukraine and overall help for the.
Speaker 9: Robert Fitzal has many times said that when he takes power,
Speaker 9: he will stop all deliveries of weapons to Ukraine from Slovakia,
Speaker 9: which is a NATO and EU member. He also said
Speaker 9: that sanctions in Russia are meaningless and useless, and they
Speaker 9: not only heard Russia, but also EU members such as Slovakia.
Speaker 9: So what we could see is him teaming up with
Speaker 9: Victor Orban of Hungary when it comes to crucial votes
Speaker 9: inside the EU.
Speaker 2: Who's his main ally main allies within the European Union?
Speaker 2: I mean, you mentioned Hungary is a key ally, but
Speaker 2: who else is the ally to Robert Fitza.
Speaker 8: During his previous terms, he was a very pro Western.
Speaker 9: Politician who stood at the core of the EU. He
Speaker 9: oversaw the country's euro membership, but lately he has become
Speaker 9: very close to Hungary's Victor Orban and also to the
Speaker 9: leadership in Poland. So you could see a strength and
Speaker 9: block of countries that have been at our with the
Speaker 9: EU over the last few years when it comes to
Speaker 9: rule of law and corruption.
Speaker 3: Fight and Jet tell us a bit more about Robert Fico.
Speaker 3: He's someone that has been around on the political scene
Speaker 3: in Slovakia for a long time, but notably has been
Speaker 3: out of office for several years.
Speaker 8: Yes, he has been in power for the last time.
Speaker 9: He was ousted several years ago and since then he
Speaker 9: has turned very.
Speaker 8: Much anti against everything.
Speaker 9: He was very vocal about the coronavirus, how people should
Speaker 9: not buy into the government stance. He was very much
Speaker 9: against Slovakia's help for Ukraine and has repeatedly said that
Speaker 9: sanctions are not the way to go when it comes
Speaker 9: to dealing with Russia. He also has seen his popularity
Speaker 9: fall to record law.
Speaker 8: But because he has been able to.
Speaker 9: Embrace this anti stance and everything he has really written.
Speaker 8: In pouls in the country that is very pro Russian.
Speaker 2: Yeah, five and a half million people in the country.
Speaker 2: Do you think that he's going to embrace the far
Speaker 2: right in his ruling coalition. Again, this is very much
Speaker 2: a theme across continental Europe. You know, what would the
Speaker 2: government look like potentially, what's the polling like, Well, it's
Speaker 2: to be seen.
Speaker 9: Really depends on the election result and how many parties
Speaker 9: across the threshold to get into parliament. But what we
Speaker 9: could see is him teaming up with his former Ali
Speaker 9: who set up his own.
Speaker 8: Party which mirrors the party of.
Speaker 9: Robert Fitzal and possibly he could embrace the Farid in
Speaker 9: the ruling coalition. The Firerid in Slovakia has very extreme
Speaker 9: views on Ukraine's possible membership in NATO and overall help
Speaker 9: for Ukraine. So if that happens, that could really strengthen
Speaker 9: Robert Fitzos and a Ukrainian stance.
Speaker 3: Who are his opposition in the selection. What are their
Speaker 3: strengths or their arguments given the position to the evautline
Speaker 3: that Robert Vico has.
Speaker 8: Well, it's mainly there's.
Speaker 9: The Progressive Party which is second in polls and the
Speaker 9: gap between them and Robert Fish's party has narrowed significantly
Speaker 9: in the last few months. There's a very liberal party
Speaker 9: that wants is the key player in the EU and
Speaker 9: in the country's back.
Speaker 8: And forth Ukraine. What we just need to see.
Speaker 9: Whether that party will be able to mobilize more voters.
Speaker 9: Whoever wins the election is the first party that gets
Speaker 9: to try to form a rule in coalition. So the victory,
Speaker 9: even if it's by a couple thousand goals, will be
Speaker 9: very important.
Speaker 3: This is Bloomberg Daybreak Europe, your morning brief on the
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Speaker 1: I'm Caroline Hepka and.
Speaker 3: I'm Stephen Carroll. Join us again tomorrow morning for all
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Speaker 3: on Bloomberg Daybreak Europe.