FirstFT: Xi warns Biden not to ‘play with fire’

Xi Jinping warned Joe Biden not to “play with fire” as the Chinese and US presidents spoke for the first time since Beijing was angered by a planned visit to Taiwan by House of Representatives speaker Nancy Pelosi.

In a statement posted on the Chinese foreign ministry’s website after the two leaders talked on Thursday, Xi did not directly mention Pelosi’s possible visit but said his administration would “resolutely safeguard China’s national sovereignty and territorial integrity”.

“Those who play with fire will perish by it. It is hoped that the US will be clear-eyed about this,” China’s president added.

Asked whether the US interpreted the comments as a threat, a senior administration official said China has regularly used the metaphor previously when discussing Taiwan.

The Biden administration said the conversation between the leaders was part of an effort to keep rising tensions between the two countries at bay. During the call, Biden and Xi directed their teams to schedule an in-person meeting between them, a senior US administration official said. In its own account of the call, the White House also avoided mention of Pelosi’s possible visit.

However it said Biden “underscored that the United States policy has not changed and that the United States strongly opposes unilateral efforts to change the status quo or undermine peace and stability across the Taiwan Strait”.

Thanks for reading FirstFT Asia. I hope you have a restful weekend. See you next week. — Emily

Five more stories in the news

1. China’s central bank seeks $148bn bailout for real estate Beijing is seeking to mobilise up to Rmb1tn ($148bn) of loans for millions of stalled property developments, in its most ambitious attempt to revive the debt-stricken sector and head off a backlash by homebuyers.

2. US economy shrinks for second consecutive quarter The US economy shrank for the second quarter in a row, meeting one of the common criteria for a technical recession and complicating the Federal Reserve’s push to stamp out soaring inflation with a string of aggressive rate rises.

3. Kim Jong Un says Korean peninsula on the ‘brink of war’ The North Korean leader has accused the US and South Korea of bringing the Korean peninsula to the “brink of war”, as Seoul and Washington prepare for their first large-scale joint military exercises in four years. In remarks reported on Thursday, Kim threatened to “wipe out” South Korean forces with nuclear weapons in the event of a confrontation.

4. US tech earnings round-up In a busy week for tech earnings, Amazon shares rose 10 per cent on Thursday after it reported better than expected quarterly revenue and issued strong guidance for the current quarter. Apple’s revenues grew slightly on the back of iPhone sales and its services division despite headwinds from supply chain shortages and factory shutdowns in China. Intel, however, reported a surprise slump in revenue.

5. Missfresh stops paying salaries as it runs out of cash The Tiger Global-backed Chinese grocery delivery start-up that was once valued at $3bn told hundreds of employees that it had run out of cash, as a group of unpaid suppliers protested at its Beijing offices.

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The days ahead

Japanese economic data The country’s monthly unemployment rate, June retail sales figures and preliminary June industrial production data will be released today.

Eurostat GDP Eurostat’s first estimate of second-quarter gross domestic product, out today, is expected to show an expansion of 0.1 per cent from the previous quarter, according to a poll by Reuters. That would be the weakest performance since a surge in coronavirus infections and restrictions dragged the bloc into a short recession at the start of 2021.

US-Japan EPCC meeting US secretary of state Antony Blinken and Secretary of Commerce Gina Raimondo co-host the first meeting of the US-Japan Economic Policy Consultative Committee in Washington on Friday.

New Cities Summit 2022 Global political leaders, business and thought leaders will gather in Singapore to discuss best practices for creating liveable and sustainable cities. The event, hosted by the new Cities Foundation, kicks off on Sunday.

What else we’re reading

The cricket match that helped fund Imran Khan’s political rise Despite laws banning foreign funding of politics in Pakistan, documents show a money trail from Oxfordshire via the UAE to the coffers of Khan’s party.
The funds are at the centre of a years-long investigation by the Election Commission of Pakistan, an inquiry that has taken on even greater importance as Khan plots a political comeback.

Extreme heat is a wake-up call for investors on infrastructure Europe’s heatwave made clear failings of existing infrastructure in extreme weather. Trains moved more slowly. A runway at Luton airport buckled. Schools closed. In a hotter world, infrastructure will need to adapt. All this creates opportunities for investors, writes Alice Ross.

Musk saga hits Twitter’s ads business Twitter chief executive Parag Agrawal is leading an increasingly fraught effort to keep the company running smoothly amid a legal battle to prevent Musk from backing out of a $44bn deal to acquire Twitter. Company insiders, former staffers and ad industry executives and say tension is rising between staff and management.

WFH debates must include what ‘home’ actually is From affordable accommodation in city centres to commute lengths, the question of where employees live is all important, writes Emma Jacobs. Employees’ decisions to move further away from work during the pandemic are now causing tensions.

Enter the inner sanctum of elite chess As eight chess grandmasters gathered in Madrid earlier this month for an international summit, they were also playing for the future of the game. Oliver Roeder takes us inside the inner sanctum of elite chess.

Food and drink

Asia is home to ideas still in early stages of research but potentially transformative in feeding more people, with fewer resources, in the decades to come. Innovations such as lab-grown meat and 3D-printed food are at the forefront of efforts to rethink how, and what, we can feed the region’s next billion.