FirstFT: Challenge to Xi | Financial Times

Xi Jinping faces one of his greatest challenges as president of China after tens of thousands of people took to the streets over Beijing’s strict coronavirus controls and suppression of freedom of speech.

At least 10 cities, including Shanghai, Beijing, Wuhan and Chengdu, were shaken by rare political protests over the weekend, triggering clashes with police and security officers that led to a spate of arrests, including of two foreign journalists.

While most of the protests appear now to have been stamped out, they followed months of frustration, especially among China’s young people, with relentless lockdowns, quarantines, mass testing and electronic surveillance under Xi’s zero-Covid policies.

One of the most striking scenes of civil disobedience was on Saturday evening in central Shanghai. The vigil was attended by hundreds and held in memory of 10 people who died in an apartment fire in Urumqi, Xinjiang, which was partly blamed on coronavirus restrictions.

“The whole system, the whole regime, is not correct,” one protester told my colleague Thomas Hale who attended the vigil.

Analysts said the scale and stark political demands of the protests had not been seen in mainland China since the Tiananmen Square massacre of 1989.

“This constitutes a challenge to central authority at the highest level,” said Yuen Yuen Ang, from the University of Michigan.

Markets in China fell following the weekend’s developments. China’s CSI 300 index of Shanghai- and Shenzhen-listed shares fell as much as 2.8 per cent today before recovering some of the losses while the renminbi lost ground against the dollar.

Five more stories in the news

1. Global inflation likely to have peaked, data suggest Headline price growth has peaked, according to economists, after global inflation hit a record 12.1 per cent in October. Factory gate prices, shipping rates, commodity prices and inflation expectations have all begun to subside from recent record levels. The easing of inflationary pressures will be a relief to central banks around the world which have raised interest rates to stamp out rising prices.

2. Nervous auditors turn up the heat on crypto clients The collapse of Sam Bankman-Fried’s crypto empire, and the spotlight it put on the auditors that signed off on his books, has prompted small audit firms to re-examine their work for businesses in the nascent industry. Several US firms told the Financial Times that they had elevated some or all of their crypto-related clients to the status of “high risk”, triggering a more thorough audit that will take longer and lead to higher bills.

3. Qatari owners of Paris Saint-Germain target valuation of over €4bn The Qatari owners of Paris Saint-Germain football club are targeting a valuation of over €4bn in talks with potential investors. The French champions have been in discussions with several investors since the summer, including at least two US-based funds, over a stake sale of up to 15 per cent.

4. EU tries to settle differences over Russian oil price cap Brussels is racing to finalise a proposed price ceiling on Russian oil shipments after member states clashed over the level of the cap and whether to link it to a wider round of sanctions. The commission is pushing for a maximum of $65 a barrel, but hawkish governments in the bloc argue it would be ineffective because the price is close to what Russia already gets.

5. Musk clashes with Twitter’s advertisers Many top brands are abandoning the social media platform, citing alarm at new owner Elon Musk’s ad hoc approach to policing content and his decision to axe many of the company’s ad sales team. Musk, meanwhile, is personally calling some chief executives to berate them for curbing their Twitter advertising.

The day ahead

Cyber Monday The online equivalent of Black Friday takes place today, with many retailers offering post-Thanksgiving holiday ecommerce deals making it one of the busiest shopping days of the year in the US.

G7 justice ministers meet The gathering takes place in Berlin, capital of Germany, which currently holds the G7 presidency. It will focus on ways to prosecute alleged Russian war crimes in Ukraine. (Reuters)

EU economic hearing European Central Bank president Christine Lagarde speaks at a hearing before the Committee on Economic and Monetary Affairs of the European parliament in Brussels, which is set to focus on inflation as a global challenge and the tightening of monetary policy.

Rishi Sunak gives major foreign policy speech The British prime minister will give the first major foreign policy speech of his premiership. Sunak will outline an “evolutionary approach” to Russia and China in the speech to business leaders and diplomats, according to a preview. (Guardian)

FT Crypto and Digital Assets Summit As the collapse of FTX continues to rip through the cryptocurrency industry, the FT gathers together policymakers, regulators and institutional investors to reflect on where the industry goes now. Mathew McDermott, the head of digital assets at Goldman Sachs, confirmed at the conference the US bank would build its own private distributed ledger technology. Register here for a digital pass.

Fifa World Cup The football tournament in Qatar continues with matches between Cameroon and Serbia, South Korea and Ghana, Brazil and Switzerland, as well as Portugal and Uruguay.

What else we’re reading

Seven days that could unravel the global oil market As western countries prepare to impose a price cap on Russian crude — one of the strongest responses yet to President Vladimir Putin’s invasion of Ukraine — many of the industry’s norms are being undermined. How disruptive might the measures be?

The fighter jet that could create a new UK-Japan defence alliance Set to take to the skies in 2035, a new hypersonic-weapons enabled jet might be at the centre of the first ever three-way defence collaboration between the UK, Japan and Italy, built on a design that would put it among the most sophisticated aircraft ever made. Plans are yet to be finalised, but the project would mark a shift in Japan’s role in the global defence industry.

Team behind Apple’s Face ID develops tiny robots to deliver drugs into brain Los Angeles-based Bionaut Labs has raised $43.2mn to develop tiny robots controlled by magnetic propulsion to target hard-to-treat diseases such as brain tumours and neurological disorders. The new funding will go toward helping roll out the first clinical trials of the new technology.

‘The short run is by far the least important thing’ Oaktree’s legendary co-founder Howard Marks sat down with the FT to discuss the business of bargain hunting, the dangers of emotion — and meeting his drug smuggler namesake.

Privacy at work How much noise is too much in the office? As workers have returned to their desks following a pandemic-driven boom in working from home, managing sound levels has become an art — and a science.

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