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Trump drops bid to slash foreign aid after Congress objects The White House will not move forward with plans to cut billions of dollars in foreign aid, U.S. officials said on Thursday, after an outcry from Congress about what was seen as an attempt to sidestep lawmakers’ authority over government spending. -Reuters

To Gain Leverage in China Trade Talks, Trump Shows Solidarity With Hong Kong -NYT

China blames Canada for difficulties in relationship, demands Huawei executive be freed Relations have been icy since Meng was detained in Vancouver last December on a U.S. warrant. China has since charged two Canadians with spying and halted imports of canola seed and meat products from Canada. -Reuters

Imported repression: How Cuba taught Venezuela to quash military dissent -Reuters

GLOBAL BUSINESS

Trump thinks tariffs will add U.S. manufacturing jobs. Economic reality says they won’t. Even companies interested in bringing jobs to the U.S. say duties on imported parts are hurting those efforts. -Politico

One Week Left Before Nearly All 'Made In China' Is Tariffed But as 10% tariffs on roughly $300 billion worth of goods goes into effect on Sept 1., there are other issues percolating that are still hard to grasp. The tech war with Huawei at the center continues apace. It is unclear how long this latest reprieve, allowing for some U.S. companies to sell microprocessors to the Chinese telecom giant, will last but it remains a reliable front in the trade war. -Forbes

YouTube Closes 210 Accounts Tied to Hong Kong Influence Campaign Google said it disabled 210 YouTube channels involved in “coordinate influence operations” around the Hong Kong protests, following similar measures earlier this week by social media companies Facebook Inc. and Twitter Inc. -Bloomberg

The US government’s battle with Chinese telecom giant Huawei, explained The US has long expressed concerns about Huawei and its ties to the Chinese government. -Recode

SEC fines Deutsche Bank $16 million to settle foreign corruption charges -Reuters

Overstock.com CEO Resigns after Disclosing Relationship with Russian Agent Maria Butina -National Review

GLOBAL MACRO

Fed’s Regional Presidents Lining Up Against Additional Rate Cuts Three Federal Reserve policy makers voiced their resistance to the notion that the U.S. economy needs lower interest rates, and fourth said he wanted to avoid taking further action “unless we have to,” foreshadowing a sharp debate with officials who want to cut again. -Bloomberg

$960B deficit expected this year, more than $1 trillion next The return to trillion-dollar deficits has been moved up by two years from the previous forecast in May -Roll Call

Emerging Markets Have Lost Faith in the Fed Once a beacon of stability, the U.S. has become a source of tumult. Markets now give global central bankers a clearer read on the economy. -Bloomberg

IMF embraces new central bank digital currencies -Roll Call

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Trump says North Korea's Kim sent 'very beautiful letter'; new meeting possible -Reuters

Kim fires more missives, more missiles North Korea’s leader is wielding both carrot and stick, but neither measure is moving him toward his goal -Asia Times

Trump Is Making Xi’s Superpower 2050 Plan Tougher by the Day His grand vision is now looking more aspirational by the day. As mounting pressure from Donald Trump adds to a slew of structural challenges facing China’s $14 trillion economy -- including record debt levels, rampant pollution, and an aging population -- the risk is that the country gets stuck in a “middle-income trap,’’ stagnating before it reaches rich-world levels of development. -Bloomberg

New phase as protesters and police clash across Hong Kong in guerilla-style battles

  • Officers use tear gas to disperse crowds that once more gathered for illegal rallies, but scale and intensity of skirmishes appears to have lessened

  • Two sides engage in running battles from Kwun Tong to Tai Po and Cross-Harbour Tunnel, while peaceful sit-in at the airport continues

A trade war over history? Sort of. Why Japan and South Korea are feuding. The trade spat kicked off with Tokyo imposing restrictions on chemicals key to South Korea’s high-tech industry, citing unspecified security concerns. Most observers, however, see the trade war as historical frictions spilling over into economic and national security arenas – underscoring how large the past looms in East Asia today. -Christian Science Monitor

Pakistan downgrades ties with India Pakistan has suspended bilateral trade with India and will downgrade diplomatic ties in a bid to build pressure against its neighbour for changing the status of Kashmir. -The Straits Times

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GLOBAL BUSINESS

China to push to attract more high-tech manufacturers China on Tuesday said it would implement a special tax policy in the newly expanded Shanghai Free Trade Zone, granting crude oil import licenses to qualified companies and providing preferential tax policies for firms operating in artificial intelligence, civil aviation, semiconductor and biopharmaceutical sectors. -Reuters

Huawei unveils Harmony operating system, won't ditch Android for smartphones -Reuters

Toyota to build battery plant in China, eyeing hybrid policy shift Panasonic-backed supplier to quadruple production in world's top auto market -Nikkei Asian Review

South Korea boycott hitting sales of Japan's Uniqlo, company says -Reuters

Samsung secures key chip supply in Belgium as Tokyo curbs exports Korean tech groups accelerate diversification while keeping Japanese suppliers -Nikkei Asian Review

Casino resort frontrunner MGM says winning and building Osaka facility by 2025 is tough but doable For Osaka, considered the front runner of the three locations that will be allowed to host the resorts, the hope is that once the Diet formally approves all necessary policies, the bureaucratic process for granting interested localities IR licenses, and subsequent construction, will go smoothly and quickly. By March 2025, just a couple of months before the Osaka World Expo opens, the city wants a casino resort to be up and running. -The Japan Times

India eases angel tax rules for startups Registered companies will now be exempt from verification The angel tax is imposed when any startup raises equity funding in excess of its “fair valuation.” The premium is treated as income, attracting a tax of more than 30%. The new tax was introduced in 2012 to curb money-laundering. It is known as the angel tax as it largely affects angel investments in startups. -Asia Times

#SMART Singapore slings a trade war antidote New Singapore Convention on Mediation promises neutral settlement of commercial and trade disputes. China, US are among its backers The Singapore Convention on Mediation, the first treaty concluded under UN auspices to be named after the city-state, aims to give businesses greater confidence to settle international disputes through mediation, which involves a neutral party working with different sides to come to an agreement rather than resort to costly court proceedings. -Asia Times

Jokowi signs electric vehicle regulation -Jakarta Post

GLOBAL MACRO

Booming Travel Is Transforming Asian Airports Into Mini-Cities New facilities aim to become destinations in themselves, with apartments, exhibition spaces, and medical centers. -Bloomberg

Modi’s Kashmir detour spells trouble for India’s economy The J&K move is as much a cry for economic help as an announcement of any new authority the Indian PM has amassed -Asia Times

Global funds set sights on Japan property market Aberdeen Standard and KKR see opportunity in low-rate environment The influx of deep-pocketed foreign players, enticed by the Bank of Japan's ultralow interest rates that allow for fundraising on the cheap, indicates that the property boom here is unlikely to lose steam anytime soon. -Nikkei Asian Review

Volatility in China's yuan due to escalating U.S. trade friction: PBOC official -Reuters

India Seeks Used Cooking Oil to Help Modi Cut Energy Imports India is the third biggest crude oil consumer on the globe and meets about 85% of its needs through imports, exposing the economy to the risks of price and supply disruptions often caused by geopolitical tensions and trade wars. The prime minister has set a target to reduce such overseas energy purchases by 10 percentage points by 2022, through increased domestic output and greater use of alternative fuels. -Bloomberg

Canada LNG project to ship gas to Asia as early as 2024 Government subsidies for project aim to reduce reliance on US market -Nikkei Asian Review

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CHINA destabilizing Indo-Pacific: U.S. Defense Secretary -Reuters

CHINA warns that Beijing 'will not sit idly by' and let Hong Kong unrest continue -The Japan Times

CHINA says 'won't back down' on principles despite tariff threat Trade tensions flare anew after cabinet-level meeting in Shanghai produces little -Nikkei

Hong Kong police fire tear gas near Causeway Bay, Beijing's Liaison Office as protesters take over key roads -The Straits Times

Japan and South Korea Are Learning the Wrong Lessons From China The adoption of a rival’s coercive tactics by a U.S. ally is alarming. -The Diplomat

Is populism finally coming to Japan? -The Japan Times

Singapore's new opposition calls for curbs on foreign labor Progress party unveils agenda as it looks to challenge People’s Action Party -Nikkei

GLOBAL BUSINESS

Elon Musk to launch China unit for tunneling company this month Elon Musk will soon launch a China unit for his underground tunneling enterprise, The Boring Company, the billionaire entrepreneur said on Twitter. -Reuters

Beijing is using Chinese tourists to inflict economic pain – but does it work? -SCMP

·         Ban on individual mainland travelers going to Taiwan is the latest move to apply pressure on the self-ruled island

·         It’s not the first time China has used tourism restrictions in this way

Another four firms to invest in Taiwan: ministry NT$504.7 billion (US$16.09 billion) in investments as another four companies joined a government program aimed at boosting investment in the nation. As a trade dispute between the US and China continues, the ministry has approved 102 companies returning to invest in the nation, providing up to 43,900 job opportunities, while another 50 companies are waiting in line. -Taipei Times

U.S. softens stance on autos in trade negotiations with Japan, sources say -The Japan Times

How a shadow banking crisis sent India's autos sector into a tailspin -Reuters

Chinese smartphone brands do battle in India as more consumers upgrade to expensive models -SCMP

·         Indian consumers are upgrading to more expensive smartphones, opening up new opportunities for Chinese brands

·         OnePlus, a Shenzhen-based brand, is the top in sales for the premium market in India

Australians endorse Huawei ban as part of hard line on China Canberra risks standing alone after Trump flip-flopped and neighbors caved -Nikkei

Venture Capital in Southeast Asia In episode 310, Justin Hall, partner from Golden Gate Ventures joined us in a conversation to discuss the state of venture capital in Southeast Asia. Justin shared his career journey in how he progressed from an associate to a partner within one of the well-known venture capital firms in Southeast Asia and explained what he has learned over the years from working with startup founders and companies. -Analyse Asia

Companies are moving supply chains out of China and into Vietnam And then there’s the Trump factor. While imports to the U.S. from China are falling, imports from Vietnam are growing rapidly. “Vietnam, after China, has the biggest trade surplus to the U.S.,” says Bell. “You have to wonder how long Mr. Trump turns a blind eye.” -MarketWatch

Total 79,300 firms set up in seven months: GSO About 79,300 new businesses were established in Việt Nam with total registered capital of VNĐ999.4 trillion (nearly US$43 billion) in the first seven months of 2019, data from the General Statistics Office (GSO) has revealed. -VNNews

GLOBAL MACRO

Offshore yuan slides towards record low after Trump tariff threat -SCMP

·         The offshore yuan traded weaker on Friday, touching a low of 6.98 against the US dollar, close to its lowest level in two-and-a-half years

Japan, U.S. target broad bilateral trade deal by September Washington seeks early opening of Japan’s agriculture sector including reductions in 38.5% tariffs on U.S. beef imports, while Japan calls for abolition of U.S. tariffs on Japan’s industrial goods such as car parts. -Reuters

South Korea readies stimulus to soften impact of Japan trade rift Tokyo says removal of Seoul's special status adheres to WTO rules -Nikkei

Lighthizer Says Vietnam Must Cut Its Trade Surplus With U.S. -Bloomberg

Mongolia's agreement with US will not affect relations with Moscow, Beijing Mongolia and the United States signed an agreement on strategic partnership during Mongolian President Khaltmaagiin Battulga's visit to Washington -TASS

Vietnam Extends Oil Rig Operations Amid Vanguard Bank Standoff With China Refusing to back down, Hanoi authorizes the extension of exploratory work by the Hakuryu-5 oil rig. -The Diplomat

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Trump Says U.S. Will Hit China With More Tariffs President Trump, frustrated by increasingly fruitless negotiations with China, said Thursday that the United States would impose a 10 percent tariff on an additional $300 billion worth of Chinese imports next month, a significant escalation in a trade war that has dragged on for more than a year -Politico

Trump's pick for top envoy to the U.N. gets Senate approval The U.S. Senate on Wednesday confirmed Ambassador to Canada Kelly Craft to become the top American envoy to the United Nations, despite criticism from some Democrats that she lacks the experience needed for the key diplomatic position and was routinely absent from her post in Ottawa. -Politico

Trump says working on free trade deal with Brazil -AFP

The Republican Exodus From Congress Eight Republican House members have announced their retirement this year, with more predicted to follow. What’s going on? -NYT

GLOBAL BUSINESS

The U.S. Might Sanction a Russian Pipeline to Germany. That’s a Terrible Idea. -Politico

Against the Republican Daddy State On Tuesday, Senator Josh Hawley introduced his second proposed regulation of social media in as many months. In June, he introduced a bill to regulate political speech on large social-media platforms. In July, he followed it up with the “SMART Act,” a bill designed to curb allegedly addictive features contained in popular applications such as Twitter, Snapchat, and YouTube. -The National Review

Apple Suspends Listening to Siri Queries Amid Privacy Outcry -Bloomberg

U.S.-China Trade War May Finally Be Coming for Apple The iPhone maker has said little publicly about its potential hit or what steps it might take to mitigate the impact. -Bloomberg

Trump Administration Weighs Allowing Drug Imports for Cheaper Prescriptions The proposal was announced between two Democratic debates, seemingly timed to show that President Trump was also trying to tackle the highly populist issue of soaring drug prices -NYT

Pentagon puts $10 billion JEDI contract on hold after Trump suggests it favored Amazon The Pentagon has decided to put on hold its decision to award a $10 billion cloud computing contract after President Donald Trump said his administration was examining Amazon.com Inc’s (AMZN.O) bid following complaints from other tech companies. -Reuters

Cuba Expands Internet Access to Private Homes and Businesses -NYT

GLOBAL MACRO

Global stocks pummeled by Trump's tariffs, safe-havens surge Global stocks are set to take another beating on Friday after U.S. President Donald Trump said he would slap a 10% tariff on the remaining $300 billion of Chinese imports from next month. -Reuters

A $600 Billion Bill: Counting the Global Cost of the U.S.-China Trade War Bloomberg economists Dan Hanson and Tom Orlik have mapped out the main scenarios. Their headline conclusion: If tariffs expand to cover all U.S.-China trade, and markets slump in response, global GDP will take a $600 billion hit in 2021, the year of peak impact. -Bloomberg

5 Smart Reasons to Tax Foreign Capital A bipartisan bill that would create a trade-balancing exchange rate for the dollar also aims to reduce foreign purchases of certain U.S. assets. -Bloomberg

Mexico's dependence on U.S. demand spells trouble for weak economy -Reuters

Will Bolsonaro's Free-Market Revolution Succeed? The first seven months of Brazilian President Bolsonaro have been driven by the idea that only free-market reforms and innovation can bring Brazil back on track after more of a decade of corrupted socialist governments led by Brazilian Workers' Party. -Forbes

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Donald Trump and Boris Johnson ‘working already’ on trade deal Johnson ‘has what it takes, they needed him for a long time,’ says US president. -Politico.eu

Iran Links British Seizure of Oil Tanker to Ailing Nuclear Deal -NYT

US formally asks Germany to 'help secure' Strait of Hormuz The US wants Germany to take part in a UK-proposed, European-led naval mission to protect ships sailing near Iran. German politicians were less than thrilled by the initiative, which aims to "combat Iranian aggression." -DW

Russia launches probe into 'mass unrest' at Moscow protest More than 1,000 people were detained during the unauthorised protest against the exclusion of opposition candidates from local polls. -BBC

GLOBAL BUSINESS

Companies using Facebook 'Like' button liable for data: EU court Companies that embed Facebook’s “Like” button on their websites must seek users’ consent to transfer their personal data to the U.S. social network, in line with the bloc’s data privacy laws, Europe’s top court said on Monday. -Reuters

German law targets money laundering in property market Germany's government is unveiling a new law aimed at combating money laundering in the real estate sector. It's estimated that billions in illegal earnings are funneled into the German property market each year. -Reuters

Trump vows to retaliate over France’s digital services tax US president announces ‘substantial reciprocal action on Macron’s foolishness.’ -Politico.eu

Trump threat to tax French wine completely moronic, minister says -BBC

Huawei says US campaign hit business in Europe, no ‘major disruption’ overall The company announces it has booked €52 billion in revenue in the first half of 2019. -Politico.eu

BAE Systems Earnings Gain on Increased U.S. Defense Spending -Bloomberg

US Senate fails to block Trump vetoes on Saudi arms sales The Senate has failed in a bid to override a series of vetoes issued by President Donald Trump, allowing the administration to move forward with plans to sell billions of dollars of weapons to Saudi Arabia and the United Arab Emirates. -Reuters

‘Small Is Beautiful’ Can Work in Developing Africa Solar and mobile technology offer ways to work around the continent’s shaky infrastructure. -Bloomberg

GLOBAL MACRO

The End of ECB Restraint Outgoing European Central Bank President Mario Draghi has indicated that the bank is planning a new round of aggressive monetary stimulus. Such measures will most likely have negative economic consequences – not least by further increasing the cost pressures weighing down German industry. -Project Syndicate

Germany's top court faces case of deja vu over ECB bond buying Germany's Constitutional Court is once more dealing with the question of whether the European Central Bank's asset purchases constitute illegal state funding. A "Yes" from Germany's top judges could lead to chaos. -DW

One direction: Brexit-hit pound facing gravity of parity Currency traders who were wary of positioning outright for a no-deal Brexit outcome seem to be finally be throwing in the towel: heavy selling has hit sterling this month and metrics such as derivatives and positioning suggest no respite ahead. -Reuters

Iran's vice president urges China, friendly countries to buy oil Iranian Vice President Eshaq Jahangiri called on China and other countries friendly with Iran on Monday to buy more Iranian oil, the oil ministry news website SHANA reported, as Chinese imports plunged after U.S. sanctions took effect. -Reuters

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China’s maritime expansion reflects a curious mix of ambition and paranoia Chinese strategists urge Westerners to understand that their country’s rise as a naval power is guided in part by deep insecurity -The Economist

Why This Narrow Strait Next to Iran Is So Critical to the World’s Oil Supply -NYT

China is not an enemy -The Washington Post

Statesmanship and creativity are needed as Washington and Beijing renegotiate a relationship that is too big to fail. -AFSA

Nailed It – Navarro Discusses U.S-China Trade Re-engagement -The Last Refuge

Mass protest draws tens of thousands to streets of Kowloon in protest against Hong Kong extradition bill -SCMP

·       Protesters march through shopping district of Tsim Sha Tsui to cross-border high-speed rail terminus in hope of explaining cause to mainland Chinese visitors

·       Organisers say 230,000 took part – far more than expected – while police put figure at 56,000

 Hong Kong and Taiwan Are Bonding Over China Hong Kong and Taiwan long had a relationship built around trade and tourism. But as China clamps down in Hong Kong, ties between the pair are strengthening. -The Atlantic

GLOBAL BUSINESS

China Appeal Fading for Japanese Companies A Teikoku Databank survey found that there were 13,685 Japanese companies operating in China as of May 2019, a decrease of 249 compared to the previous survey conducted in 2016. Doing business in China has come to appear less attractive, with rising labor costs in the country over recent years among the declining benefits. Another factor is concern about the future impact of intensifying US-China trade friction. -Nippon.com

Walmart China plans $1.1bn investment in logistics Program includes building or updating more than 10 distribution centers over the next 10 to 20 year -Asia Times

Japanese firms cautious of fallout from deteriorating ties between Tokyo and Seoul A number of firms said they are anxiously watching developments, noting it remains unclear if the newly-introduced regulations will actually hinder trade between the two nations. Under the new regulations, at the longest, it could possibly take 90 days for Japanese exporters to get official approval on certain key items bound for South Korea. -The Japan Times

Samsung chief visits Japan to seek export curb workarounds Electronics maker urges such steps as supplying South Korea from overseas plants -Nikkei

If Masayoshi Son Won't Invest in Japan, Why Should You? His $100 billion Vision Fund is noticeably absent on its home turf. That speaks volumes about the health of the country’s startup scene. -Bloomberg

Taiwan to cut tariffs on sake and Japan farm and fishery products as it looks to join TPP -The Japan Times

Myanmar economic zone reimagined as export hub to India Japan hopes reworked Dawei will mean more leverage over Chinese influence -Nikkei

Is Beijing hitting out at offshoring in Cambodia? -Asia Times

Cambodia and Vietnam in the US-China Trade War: Not All Good News Both countries face opportunities, but investors cannot overlook the lingering risk -The Diplomat

GLOBAL MACRO

Time to end BOJ's grand experiment? Central banks are back on the center stage of the global economic policy debate. The U.S. Federal Reserve and the European Central Bank now appear ready to ease monetary policy — in a turnaround from just some months ago when people were looking for “exit” and additional rate hikes. -The Japan Times

EM Carry Trades With a 6% Yield Are Getting Harder to Resist -Bloomberg

Thai baht races ahead of Prayuth's slow progress The strong currency is hurting Thailand's competitiveness and threatens further damage -Nikkei Asian Review

Erosion of Hong Kong’s institutional autonomy will hurt advantage over mainland China cities, high credit rating: Moody’s -SCMP

·       Ratings agency affirms city’s long-term issuer rating of ‘Aa2’

·       City’s status as an independent entity could be ‘altered suddenly and much earlier than 2047’ by some of its international partners, the agency says

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EU leaders settle on a new team to run the club -The Economist

Leaders choose France's Lagarde for ECB after marathon summit European Union leaders agreed on Tuesday to name France’s Christine Lagarde as the new head of the European Central Bank and sealed a deal on filling the EU’s other top four jobs after marathon talks that have exposed deep divisions in the bloc. -Reuters

Iran to boost uranium enrichment level, breaching nuclear pact: Rouhani -Reuters

Turkey, China seek to expand economic ties despite political differences Turkey and China have expanded ties, but their relationship is marked by continued distrust and competition. The two sides are expanding economic cooperation but fundamental political differences remain. -DW

How to Sink the Pirates Plaguing West Africa After a crackdown near Somalia, the crime wave just shifted to the Gulf of Guinea. Local nations and their allies can end it. -Bloomberg

GLOBAL BUSINESS

Euro zone June business growth slow as factories still faltering Euro zone business activity picked up slightly last month but remained weak as a modest but broad-based upturn in the services industry offset a continued deep downturn in factory output, a survey showed.

EU reaches trade deal with South American bloc The European Union and South American trade bloc Mercosur sealed a blockbuster trade deal Friday, ending 20 years of talks over one of the world's largest regional commercial accords, negotiators said. The agreement came after two decades of often tough negotiations between the EU and the countries of Mercosur -- Argentina, Brazil, Paraguay and Uruguay -- which had repeatedly stalled because of European farmer sensitivities over the beef market. -France24

U.S. Proposes New Tariffs on $4 Billion of E.U. Goods as Trade Dispute Grows The United States moved to impose levies on more products than previously planned in an escalation of its fight with Europe over government aid for Boeing and Airbus. -NYT

Scotch whisky targeted by new US tariffs -BBC

Germany fines Facebook for underreporting hate speech complaints The US social media giant has been found guilty of failing to fully report the number of complaints it received, in clear violation of German transparency laws. Facebook may appeal the ruling, saying the law is unclear. -DW

Ford to cut 12,000 jobs across Europe by end of 2020 UK, Germany and Russia to be hardest hit as car manufacturer swings axe -The Independent

GLOBAL MACRO

The ECB Needs New Inflation Rules The European Central Bank has consistently undershot its inflation objective of “close to, but below 2%” for over a decade, potentially threatening its credibility. To maintain credibility, the ECB should adopt a two-pronged strategy focusing on a medium-term inflation target and systematically smoothing financial cycles. -Project Syndicate

Switzerland-EU partnership row passes deadline Brussels refused to extend recognition of Swiss market regulation, effectively banning EU-based banks and brokers from trading on Swiss exchanges. -DW

PM Conte says Italy will receive competition portfolio in next EU Commission Prime Minister Giuseppe Conte said on Tuesday Italy would receive the influential competition portfolio in the next European Commission, adding he was confident his nation would also obtain a post on the next ECB board. -Reuters

Italy Proves How Markets Have Abandoned Logic The “greater-fool” theory leads market commentary. Plus, a dour U.K. forecast, dented tin, a debt-ceiling dance and more. -Bloomberg

Brexit is being blamed for dismal manufacturing numbers. Is a rhetoric recession on the way? -The Independent

Russia and OPEC Draw Closer on Oil, Joining Other Producers to Manage Market -NYT

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Trump Steps Into North Korea and Agrees With Kim Jong-un to Resume Talks President Trump became the first American commander in chief to set foot in North Korea on Sunday. He greeted the country’s leader at a last-minute meeting at the Demilitarized Zone -NYT

China warns of long road ahead for deal with U.S. After ice-breaking talks China and the United States will face a long road before they can reach a deal to end their bitter trade war, with more fights ahead likely, Chinese state media said after the two countries’ presidents held ice-breaking talks in Japan. -Reuters

“We’ve said it before - communication and friction between China and the United States is a long-term, difficult and complex thing. Fighting then talking, fighting then talking, is the normal state of affairs,”

Three Lessons from the Hong Kong Protests Enormous protests this month in Hong Kong over a proposed extradition law have revealed the depth of citizens’ concern for their way of life, and of their anger at Chief Executive Carrie Lam’s gross mismanagement. -Project Syndicate

First and most obvious lesson of recent events is that Lam is a liability as chief executive, and that she has squandered all credibility.

Second, Hong Kong’s protesters and activists have succeeded so far because they did not directly challenge Xi or the CPC, but instead focused on Lam’s failings and demanded withdrawal of the extradition bill.

Third, China should recognize that its process for selecting Hong Kong’s chief executive is deeply flawed. Lam is politically inept largely because she lacks the nous that every elected politician acquires through the hurly-burly of electioneering.

Mongolia: Bridge or Buffer in Northeast Asia? Reflections from the 6th Ulaanbaatar Dialogue and beyond. -The Diplomat

GLOBAL BUSINESS

Morgan Stanley likely to gain majority control of China securities JV in H2 -Reuters

Chinese envoy says Syngenta takeover was a bad deal Beijing’s ambassador to Switzerland said ChemChina’s $43 billion takeover of seed and agrochemicals firm Syngenta was a mistake, adding he would have tried to stop the 2017 deal had he been in Bern at the time, a newspaper reported in an interview on Saturday. -Reuters

Chinese fret as Samsung, other giants leave Samsung to close key assembly base in Guangdong, while Foxconn may cut production of iPhones -Asia Times

How Wine Became Part of the Trade War China has slapped three rounds of tariffs on American wine in little more than a year, with the latest one coming into effect at the start of June -Bloomberg

ECONOMIC STATECRAFT COMES TO JAPAN Japan restricts tech exports to South Korea over wartime labor row Move risks being seen as backtracking on free trade -Nikkei Asian Review

BUT NOT ECONOMIC DIPLOMACY Japan Is Cool But Has No Clue About Selling Itself The country struggles to make money off of its worldwide cultural cachet. -Bloomberg

Taiwan rejects HK firm's skycraper bid over China 'security concerns' Taiwan has vetoed a $2 billion bid by a Hong Kong-led consortium to build a twin skyscraper in Taipei citing national security concerns, arguing the company is too heavily influenced by mainland China. -Taiwan Focus

India yet to make a call on Huawei Telecom minister has said a committee will assess security factors on whether Chinese firms can take part in 5G networks -Asia Times

Toyota to invest ¥210 billion in Indonesia to develop hybrid cars through 2023 Toyota Motor Corp. will invest about ¥210 billion ($1.9 billion) through 2023 in Indonesia, mainly to develop hybrid cars, people close to the matter said Saturday. -The Japan Times

GLOBAL MACRO

DECOUPLING FROM CHINA: it’s about time After 40 years building up a near-pathological dependence on China, it’s time for US industry to pull back from the People’s Republic of China – even if not a total decoupling. -Asia Times

China's Weak Factory Report Shows Need for Lasting Trade Truce -Bloomberg

How the extradition bill crisis threatens Hong Kong’s currency peg to the US dollar -SCMP

·       The extradition bill risks undermining Hong Kong special status in the eyes of the international community. Any change could lead to a flight of capital, which would in turn threaten the city’s currency

OPIC to double investment in Indonesia over next five years The Overseas Private Investment Corporation (OPIC) is seeking to strengthen its presence in Indonesia by doubling its investment in Southeast Asia's largest economy over the next five years. -Jakarta Post

Việt Nam values partnership with US: spokesperson The spokesperson was answering questions from reporters about Việt Nam’s reaction to US President Donald Trump’s recent negative remarks on Việt Nam-US trade ties. -VNNews

Vietnam and EU sign free trade deal Hailed as a ‘milestone’ by Brussels, agreement will slash duties on almost all goods -Asia Times

Manila grows ever richer despite Duterte bid to boost regions -The Asian Review

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Hong Kong’s Leader, Yielding to Protests, Suspends Extradition Bill Carrie Lam, Hong Kong’s chief executive, on Saturday expressed “sorrow and regret” for having failed to convince the public that an extradition bill was needed. -NYT

Thousands march in Hong Kong on Sunday despite government climbdown Huge protest follows demonstrations days earlier against extradition law, where riot police fired tear gas and rubber bullets -Asian Times

China is courting trouble in Hong Kong Beijing risks goading US into revoking city's economic and financial privileges -Nikkei

In 1992, the U.S. Congress passed the U.S.-Hong Kong Policy Act, to continue treating the city as a separate entity from mainland China. The law grants Hong Kong economic and trading privileges, such as continued access to sensitive technologies and the free exchange of the U.S. dollar with the Hong Kong dollar.

The U.S.-Hong Kong Policy Act has teeth to deter China from violating its commitments. In particular, it explicitly empowers the U.S. President to issue an executive order suspending some or all of Hong Kong's privileges if he or she determines that "Hong Kong is not sufficiently autonomous to justify treatment under a particular law of the United States."

What will Narendra Modi do in his new term as India’s prime minister? His choice of ministers suggests he does not plan to do much delegating -The Economist

Panelo says possible for PH to cut ties with China over boat sinking Presidential Spokesperson Salvador Panelo says an 'outraged' President Rodrigo Duterte draws the line when Chinese acts involve physical harm to Filipinos -Rappler

GLOBAL BUSINESS

Broadcom's $2 billion warning rattles global chip sector Broadcom Inc sent a shockwave through the global chipmaking industry on Friday with its forecast that U.S.-China trade tensions and the ban on doing business with Huawei Technologies would knock $2 billion off the company’s sales this year. -Reuters

Huawei Digs In for a Drawn-Out Battle With Trump’s White House With its American supply chain drying up, the Chinese tech giant is working on contingency plans. -Bloomberg Businessweek

China's FedEx probe should not be seen as retaliation: Xinhua

Section 301 update: List 3 exclusion process to commence Summer 2019 Section 301 List 3 covers $200 billion worth of Chinese goods and 5,745 product lines defined at eight-digit level of the Harmonised Tariff Schedule of the United States (HTSUS). Pursuant to a 9 May 2019 notice published by the USTR, the tariff rate applicable to List 3 goods was increased from 10% to 25% on 10 May 2019. -International Law Office

Japanese companies opposed to U.S. slapping additional tariffs on Chinese goods U.S. subsidiaries of Japanese companies, as well as American and Chinese businesses, have voiced opposition to President Donald Trump’s proposed tariffs of up to 25 percent on an additional $300 billion of Chinese products. -The Japan Times

Companies such as Epson America Inc., Sony Interactive Entertainment LLC and Mitsubishi Chemical Corp., as well as U.S. industry groups, expressed their stances before the Office of the U.S. Trade Representative holds a hearing starting next week on the proposed tariffs.

Japan inches toward easing foreign workers' culture shock Newcomers still face labor, lifestyle and language stumbling blocks -Nikkei

India to impose retaliatory tariffs on 28 U.S. goods from Sunday India on Saturday amended its previous order “to implement the imposition of retaliatory duties on 28 specified goods originating in or exported from USA” while preserving the existing rate for these goods for all other countries, the government notification said. -Reuters

Damaged Singapore-registered Japanese tanker arrives at UAE anchorage after Gulf attack -The Straits Times

Vietnam sees robust growth in Airbnb services There were 40,000 active Airbnb listings in Vietnam as of January this year compared to only 1,000 in 2015, according to the Homesharing Vietnam -VNExpress

GLOBAL MACRO

Trade war could cause global recession, Beijing official warns, as US investment growth in China sinks -SCMP

·       US investment in China grew 7.5 per cent between January and May, year on year, a much slower pace than the 24.3 per cent recorded between January and April

·       Ministry of Commerce spokesman Gao Deng says that the trade war ‘could cause a recession in the United States and global economies’

Indonesia expects more foreign investment after ratings bump S&P and others list country as 'BBB' as structural reforms look to continue -Nikkei

World Bank grants $49.6 million loan for Indonesia’s urban planning program -Jakarta Post

VPBank seeks to issue over $1 billion in international bonds Under the proposal, the Vietnamese private bank intends to offer $1 billion worth of bonds in the form of 3-5 year Euro Medium Term Notes to investors outside the U.S. and Canada, which will be listed on the Singapore Exchange (SGX). -VNExpress

Singapore investors snap up US$5 billion of China’s commercial properties, brushing aside trade war concerns -SCMP

Ministry plans to step up efforts to prevent seeds, saplings of high-end fruit varieties from being taken out of country The Agriculture, Forestry and Fisheries Ministry is set to launch full-fledged efforts to prevent “outflows” of domestically developed high-end fruit varieties to other countries. -The Japan Times

Pork imports skyrocket as African swine fever continues to spread -VNExpress

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Voters, Your Foreign Policy Views Stink! Rogue nations thrive when the good lose all conviction -NYT

The President’s 2019 Trade Policy Agenda and the United States-Mexico-Canada Agreement -U.S. Senate, Finance Committee Hearing

Trump Should Make a Deal with China Before It’s Too Late Making a monster out of Beijing would make Americans poorer and less safe -The National Interest

PODCAST OF THE WEEK: The New Politics of Trade: ‘There’s China and There’s Everything Else:’ Trump’s trade wars scramble domestic political fights Trump has pushed Republicans away from their long-held positions on free trade. -Politico

Trump says Canada, Mexico behind trade deal, up to U.S. to get it passed. -Reuters

Mexico Senate Should Ratify USMCA Trade Deal Next Week: President -Reuters

GLOBAL BUSINESS

House lawmakers open antitrust probe into tech industry's biggest players -Politico

Tech elites dismiss breakup threats from Washington But the striking thing is that all of them are massively beefing up their lobbying muscle in D.C. The thing to do is to watch what they do and not what they say.” Indeed, the biggest online companies have invested heavily in protecting their policy interests in Washington, manifested by their sizable and growing influence operations. -Politico

Google alone spent $21.2 million to lobby the federal government last year, alongside donating to hundreds of associations and policy organizations in the capital. And they’ve also ramped up their efforts in Europe, where regulators have punished Google with a total of $9.2 billion in fines in the past three years and have opened investigations into Facebook, Amazon and Apple.

How (Not) to Regulate the Internet We should be more focused on protecting user rights than on policing content itself. -The American Interest

Over 600 U.S. companies urge Trump to resolve trade dispute with China: letter Walmart Inc, Target Corp and more than 600 other companies urged U.S. President Donald Trump in a letter on Thursday to resolve the trade dispute with China, saying tariffs hurt American businesses and consumers. -Reuters

Why Tesla and Uber won’t escape 25% tariffs — for now -TechCrunch

Why one U.S. can-maker avoids Trump's tariffs while rivals pay up The U.S. Commerce Department granted DS Containers an exemption from the import tax because it uses a raw material, plastic-laminated steel, that isn’t produced by U.S. steelmakers. -Reuters

Trump vows to 'do something' about EU wine duties But US wines shipped to the EU face duties of 11 to 29 cents a bottle, according to the Wine Institute, a trade body promoting American exports. In 2017, the United States imported $4.5 billion in European wine but sold only $553 million to Europe. -France24

Canada rejects idea of halting extradition of top Huawei executive to United States -Reuters

Judge Rejects Mexican Tomato Growers’ Request For Relief This week, Judge Jennifer Choe-Groves of the U.S. Court of International Trade declined to halt both the collection of nearly 18% duties on imported Mexican tomatoes and a recently restarted dumping investigation. -Fronteras

GLOBAL MACRO

How Tanker Attacks on a Skinny Waterway Could Affect Oil Prices The Strait of Hormuz, the gateway for a third of all crude oil by tanker, has become a security risk that could threaten the oil market. -NYT

U.S. blames Iran for tanker attacks in Gulf of Oman, oil prices rise -Reuters