FirstFT: Nancy Pelosi vows US support for Taiwan as officials warn of China military blockade – Financial Times

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Good morning. We begin today with our continued focus on Nancy Pelosi’s historic trip to Taiwan.

During a meeting with Taiwan’s president Tsai Ing-wen, the House Speaker pledged to “always” stand by the country and not “abandon” it.

“America made a bedrock promise to always stand with Taiwan, and this visit is a reminder of that,” Pelosi said at the presidential office in Taipei yesterday.

For Pelosi, the visit is the latest salvo in a career of standing up to China over issues that encompass its human rights record in Tibet and Xinjiang, its crackdown on democracy in Hong Kong and its aggressive military activity.

But the visit has enraged China, which has announced that it will begin live-fire military exercises in the waters around Taiwan from today until Sunday.

The drills could amount to a blockade of a country whose economic lifeblood comes from exports and which is highly reliant on energy imports.

Meanwhile, the commercial ramifications from Pelosi’s trip have already begun. The China customs administration has suspended imports of more than 2,000 food products from Taiwan. The move is seen by observers as the start of a campaign by Beijing to punish Taipei for Pelosi’s visit.

But Tsai praised Pelosi’s visit “under such challenging circumstances” and said it boosted public confidence in the strength of her country’s democracy.

Thanks for all your comments on this topic. Here is a selection from FirstFT readers submitted ahead of Pelosi’s arrival in Taiwan:

“I think it’s brave of her and also a necessity to declare to the Chinese that the free world doesn’t accept threats.” Moses Isik, Stockholm, Sweden

“I see no reason for her to pursue such a reckless action, particularly given the threats of a military response from the People’s Liberation Army.” Guy Cowman-Sharpe, Sheffield, England

“We need to stand firm with Taiwan and other democratic forces in Asia, against intimidation from the Chinese Communist party.” David Tran, Washington, US

“[The visit] makes the US look weak and disjointed with ‘no one in charge’ in the name of democracy.” Mitchell Harris, Sunapee, New Hampshire

Thanks for reading FirstFT Asia. Here’s the rest of the day’s news — Emily

1. SoftBank raises $22bn in moves to sell down Alibaba stake The group led by billionaire Masayoshi Son has raised $22bn in cash from deals that would sharply reduce its stake in Alibaba as the Japanese investor responds to a market downturn that has ravaged its tech portfolio.

SoftBank taps growing portion of Alibaba stake for cash

2. Iran to resume nuclear talks Iran’s negotiator Ali Bagheri Kani and US envoy Rob Malley were both heading to Vienna yesterday in a bid to revive the 2015 nuclear accord. They will discuss with world powers fresh proposals put forward by the EU.

3. Gerhard Schröder says Russia wants negotiated end to Ukraine war Germany’s former chancellor has said after he visited Vladimir Putin in Moscow last week that the Kremlin is open to talks to end the war in Ukraine. Schröder has been harshly criticised over his links to Putin, a close friend, but says he has “condemned the war many times”.

4. Elon Musk subpoenas Goldman Sachs and JPMorgan in Twitter fight The tech billionaire is seeking information on how the two Wall Street banks advised Twitter on his proposed $44bn buyout of the social media company, which the Tesla chief executive is now seeking to abandon. It is the latest legal manoeuvre in the litigation between Musk and Twitter as both sides prepare for the trial starting in October.

5. UK parliament closes TikTok account a week after launch A group of parliamentarians raised concerns that Beijing used the social media app as spyware, which led to the closure of the UK parliament’s TikTok account. The move is the latest blow to the Chinese company which has repeatedly faced scrutiny from western governments despite denying sharing any US or UK data with the Chinese authorities.

The day ahead

Qixi Festival Also known as Chinese Valentine’s Day, the holiday celebrates the annual meeting of the cowherd and weaver girl in Chinese mythology.

Corporate earnings Today we’ll be watching for results from Alibaba, Nippon Steel, SoftBank Group and Toyota. See our full list here.

Tory debate Finalists in the race for UK prime minister, Liz Truss and Rishi Sunak, will go head to head in another televised debate on Sky News today at 8pm BST.

  • Opinion: Both candidates threaten to dent 15 years of enviably bipartisan UK climate policy — just as other nations are starting to take notably robust action, writes Pilita Clark.

Bank of England meets BoE governor Andrew Bailey has made it clear that while a 0.5 percentage point increase in interest rates is “not locked in”, it will be “among the choices on the table” when the monetary policy committee makes its policy decision today.

Join us on Saturday September 3 in person or online for the FTWeekend Festival, featuring a day of debates, tastings, performances and more. Hear from speakers including Great British Bake-Off winner Nadiya Hussain and psychotherapist Esther Perel. Claim £20 off your festival pass using promo code FTWFxNewsletters.

What else we’re reading

Japan’s thin line between church and state The close historic ties between the ruling Liberal Democratic party in Japan and South Korea’s Unification Church, or Moonies, is widely known but rarely discussed in public. But relations between the two institutions are now firmly back in the spotlight after the assassination of former prime minister Shinzo Abe.

Ever more erratic monsoons take their toll in India The intensity and timing of summer monsoons, which were never particularly regular, are becoming even more unpredictable. This is not only worrying for the hundreds of millions whose livelihood and diet are thanks to the rains. It’s also a problem for bankers, writes Chloe Cornish.

Killing of al-Qaeda’s Ayman al-Zawahiri deals setback to Taliban The assassination of the al-Qaeda leader has revealed Washington’s ability to conduct extensive surveillance and attack in the centre of Afghanistan’s capital and shattered efforts by the government in Kabul to build trust with foreign powers and gain international legitimacy.

China’s role in Kenya’s election campaign The two men going head to head to become Kenya’s next president agree on one thing: China is at the heart of next week’s election. While deputy president William Ruto threatens deportations of Chinese nationals, his veteran rival former prime minister Raila Odinga has promised a renegotiation of Beijing loans

Investors grow frustrated with hedge funds after historic losses Hedge funds are heading for one of their worst years of performance on record, leaving investors frustrated with how many managers have failed to offset sharp falls in equity and bond markets. Funds like Daniel Loeb’s Third Point, which is nursing losses after a bet on software company SentinelOne and electric-vehicle maker Rivian Automotive, are suffering.

Column chart of Annual change in HFRI fund weighted composite (%) showing Hedge funds on track for steep 2022 fall

Food & drink

Fizzy water has bewitched humans since ancient times, writes Alice Lascelles, who reviews the best H2O with bubbles for HTSI.

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