Financial Times Europe - 27.08.2019

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Briefing

iBristol-Myers and Celgene progress

The $90bn merger between the pharma groups has

taken a step towards regulatory approval after

Celgene agreed the sale of its psoriasis drug Otezla

to rival Amgen for $13.4bn in cash.— PAGE 11

iChina storm over US federal pension fund

Top senators have demanded that one of the largest

retirement funds reverse a planned portfolio shift

that they say will aid China’s military and spying

efforts by funding companies involved.— PAGE 4

iFive Star grass roots warn over coalition

Activists from the populist Italian group have

threatened to desert if its leaders seal a deal with

the Democratic party, which they see as an element

of the discredited establishment.— PAGE 2

iSlain Malta journalist’s family hits at UK

Relatives of Daphne Caruana

Galizia, who was investigating

political corruption allegations

when she was murdered, have

said Britain has not done

enough to seek justice.— PAGE 2

iGloom deepens over German economy

Asurvey of business leaders this month has found

that sentiment has sunk to its lowest level in seven

years, the fifth consecutive month of increasing

pessimism.— PAGE 2; MELVYN KRAUSS, PAGE 9

iBrazilian business joins Amazon outcry

Top companies and trade groups have added their

voice to global concerns over the forest fires, fearing

boycotts as environmentally conscious buyers turn

away from the country’s produce.— PAGE 3

iFacial recognition group eyes HK listing

Megvii, one of China’s top two facial recognition

companies, has filed for a listing in which it will

seek to raise as much as $1bn, braving a market

pummelled by trade tensions and protests.— PAGE 11

Datawatch

Big brands, big data

How consumer goods groups are

reinventing market research— PAGE 7

TUESDAY 27 AUGUST 2019 WORLD BUSINESS NEWSPAPER EUROPE

World Markets

STOCK MARKETS

Aug 26 prev %chg

S&P 500 2868.63 2847.11 0.

Nasdaq Composite 7822.98 7751.77 0.

Dow Jones Ind 25835.43 25628.90 0.

FTSEurofirst 300 1460.84 1459.44 0.

Euro Stoxx 50 3349.25 3334.25 0.

FTSE 100 7094.98 7128.18 -0.

FTSE All-Share 3898.58 3912.94 -0.

CAC 40 5351.02 5326.86 0.

Xetra Dax 11658.04 11611.51 0.

Nikkei 20261.04 20710.91 -2.

Hang Seng 25680.33 26179.33 -1.

MSCI World $ 2094.63 2131.68 -1.

MSCI EM $ 973.66 975.66 -0.

MSCI ACWI $ 500.94 508.91 -1.

CURRENCIES

Aug 26 prev

$ per € 1.111 1.

$ per £ 1.222 1.

£ per € 0.909 0.

¥ per $ 105.975 105.

¥ per £ 129.529 130.

SFr per € 1.087 1.

€ per $ 0.900 0.

Aug 26 prev

£ per $ 0.818 0.

€ per £ 1.100 1.

¥ per € 117.775 117.

£ index 75.708 74.

SFr per £ 1.196 1.

COMMODITIES

Aug 26 prev %chg

Oil WTI $ 54.00 54.17 -0.

Oil Brent $ 58.98 59.34 -0.

Gold $ 1503.80 1502.05 0.

INTEREST RATES

price yield chg

US Gov 10 yr 132.11 1.52 -0.

UK Gov 10 yr 150.29 0.48 0.

Ger Gov 10 yr -0.67 0.

Jpn Gov 10 yr 120.49 -0.28 -0.

US Gov 30 yr 115.66 2.02 -0.

Ger Gov 2 yr 101.26 -0.89 -0.

price prev chg

Fed Funds Eff 2.40 2.38 0.

US 3m Bills 1.97 2.00 -0.

Euro Libor 3m -0.45 -0.45 0.

UK 3m 0.76 0.76 0.

Prices are latest for edition Data provided by Morningstar

P R I M R O S E R I O R DA N— HONG KONG

Indonesia has named a site in East

Kalimantan on the island of Borneo as

its new capital to replace Jakarta.

The long-touted new city would be

located between the regions of Kutai

Kartanegara and North Penajam Paser,

near the port city of Balikpapan, a two-

hour flight from Jakarta, President Joko

Widodo said yesterday.

Jakarta sits on swampland and is one

of the fastest sinking cities in the world.

Parts of the megacity could be com-

pletely submerged by 2050, researchers

say. The city is also nearing traffic grid-

lock and suffers severe pollution.

Euromonitor International, the mar-

ket researcher, estimates Jakarta will

overtake Tokyo to become the world’s

most populated city by 2030, when its

population is set to reach 35.6m.

Mr Widodo said the East Kalimantan

site had been chosen for several reasons,

including that the risk of natural disas-

ters was “minimal, whether from

floods, earthquakes, tsunamis, forest

fires, volcanoes or mudslides”.

He is also keen to set up a t echnology-

focused city to address unequal wealth

distribution between the island of Java,

where Jakarta is located, and the outer

islands in the archipelago.

The idea of moving the capital has

long been discussed, but Mr Widodo’s

government has said it hopes that con-

struction will begin by 2021, with gov-

ernment functions to start moving to

the new city from 2023-24.

The president asked parliament to

sign off on the relocation this month.

The city is expected to cost Rp466tn

($32.7bn), with funding coming from

public-private partnerships, the private

sector and state-owned enterprises.

Aaron Connelly, a research fellow

focusing on south-east Asia at the Inter-

national Institute for Strategic Studies

in Singapore, said that while Mr Widodo

seemed “more serious” about the move

than his predecessors, the proposal

deserved “continued scepticism”.

“This will be a massive undertaking

and require broad consensus among

Indonesian political figures. The presi-

dent will need to spread the patronage

around to get it done, which means it is

unlikely to happen quickly or cleanly,”

he said. “Instead of facing up to the task

of fixing Jakarta, with all its complex

social ills, the president has decided to

do a hard restart.”

The move was unlikely to make

Jakarta more habitable. “But it will be

seen in Indonesia as a nation-building

legacy for [him], if he can pull it off.”

Indonesia selects Borneo site for new

capital as Jakarta faces deluge by 2050

©THE FINANCIAL TIMES LTD 2019

No: 40,179★

Printed in London, Liverpool, Glasgow, Dublin,

Frankfurt, Milan, Madrid, New York, Chicago, San

Francisco, Orlando, Tokyo, Hong Kong, Singapore,

Seoul, Dubai, Doha

AnalysisiPAGE 2

Arizona churches face fire

over migrant sanctuary

Austria €3.80 North Macedonia Den

Bahrain Din1.8 Malta €3.

Belgium €3.80 Morocco Dh

Bulgaria Lev7.50 Netherlands €3.

Croatia Kn29 Norway NKr

Cyprus €3.60 Oman OR1.

Czech Rep Kc105 Pakistan Rupee

Denmark DKr37 Poland Zl 20

Egypt E£42 Portugal €3.

Finland €4.50 Qatar QR

France €3.80 Romania Ron

Germany €3.80 Russia €5.

Gibraltar £2.70 Serbia NewD

Greece €3.60 Slovak Rep €3.

Hungary Ft1200 Slovenia €3.

India Rup220 Spain €3.

Italy €3.60 Sweden SKr

Latvia €6.99 Switzerland SFr6.

Lebanon LBP7500 Tunisia Din7.

Lithuania €4.30 Turkey TL

Luxembourg €3.80 UAE Dh17.

The overall rate of

tax on diesel is

lower than on

petrol in all EU

countries except

the UK, where

excise duty of 665

euros per 1,

litres of road fuel

is more than twice

the minimum EU

level. The lowest

diesel duties are

found in Sweden

Fuel gauge

Excise duty per  litres ()

Source: European Commission

Diesel Petrol

UK

Italy

France

Netherlands

Germany

Greece

Spain

Sweden

300400500600700

Pressure on Putin

Young Russians are thirsty for

change— TONY BARBER, PAGE 9

Too much TV

Streaming gives viewers infinite

choice — EMMA JACOBS, PAGE 8

V I C TO R M A L L E T A N D

M I C H A E L P E E L— BIARRITZ

Emmanuel Macron said he would bro-

ker a meeting between Donald Trump,

US president, and Iranian counterpart

Hassan Rouhani in order to replace the

faltering Iran nuclear agreement with a

more stringent and durable deal.

The initiative to end the crisis in the

Gulf was revealed by Mr Macron at the

end of the G7 summit at a joint press

conference with Mr Trump. “My convic-

tion is that an agreement can be

reached,” Mr Macron said after speak-

ing to Mr Rouhani by telephone and

hearing from him that he would be open

to meeting the US president.

Mr Trump said: “If the circumstances

were correct I would certainly agree” to

meet Mr Rouhani. However, if the situa-

tion in the Gulf deteriorated “they are

going to be met with really very violent

force”, he added. “We are not looking for

leadership change... we’re looking for

no nuclear weapons, no ballistic

missiles and a longer period of time

[than the current agreement expiring in

2026].”

Gulf tensions rose last year when Mr

Trump withdrew from the 2015 nuclear

deal negotiated under predecessor

Barack Obama and imposed strict US

sanctions on the Iranian economy.

With the backing of other signatories

to the original deal, including the UK

and Germany, Mr Macron has been

spearheading a drive to “de-escalate”

tensions in the Gulf by brokering a new

deal between Iran, the US and other

world powers.

Western governments say they have

similar aims: preventing Iran from

obtaining nuclear weapons; ending

Iran-sponsored destabilisation of the

Middle East; and limiting Tehran’s

ballistic missile capabilities.

Mr Macron accelerated his Iran diplo-

macy in the days leading up to the G

summit, meeting Tehran foreign minis-

ter Mohammad Javad Zarif in Paris on

Friday and then inviting him to fly to

Biarritz for another meeting on the

fringes of the G7 two days later. The

French president kept Mr Trump

informed each step of the way, both men

said at the news conference.

“I prefer to talk of a concerted initia-

tive rather than mediation,” Mr Macron

said. “Nothing is done. Things are very

fragile,” he added. Analysts said that

any deal would mean an easing of US

sanctions to allow Iran to sell more oil,

in return for Iran complying with limits

on its nuclear industry to prevent devel-

opment of nuclear weapons.

The Iran initiative was the culmina-

tion of a G7 summit that was always at

risk of ending in acrimony because of

divisions between Mr Trump and the

other leaders on issues such as Brexit,

climate change and trade. “This is a

truly successful G7, there was tremen-

dous unity, ” Mr Trump said.

In a speech on Iranian television, Mr

Rouhani said Iran “must work with our

two hands... the hand of power and

the hand of diplomacy”.

The US and France also reached a

compromise on France’s new turnover

tax on Big Tech. Paris said the tax would

be abolished as soon as a global mini-

mum tax was agreed through the OECD.

Under a compromise worked out by

Bruno Le Maire, French finance minis-

ter, and US Treasury secretary Steven

Mnuchin, the French tax will stay in

place for two years but companies will

receive tax credits for those years if the

international tax rate agreed results in a

lower level of taxation.

Additional reporting by Monavar Khalaj

in Tehran

Trump open to Iran meeting as

Macron seeks to broker accord

3 US president sets out conditions 3 Other nations back initiative 3 Plan unveiled at G

Donald Trump

and Emmanuel

Macron at a

press briefing

yesterday

Ian Langsdon /EPA-

EFE/Shutterstock

‘It’s hard to think of a topic the US isn’t

allergic to or doesn’t push back on

now,’ according to one senior

European diplomat at the summit.

‘Or if there is agreement between the

participants, it’s the lowest common

denominator — at the level of “the sun

rises and the sun sets”.’

Tensions mar

charm offensive

page 3

AUGUST 27 2019 Section:FrontBack Time: 26/8/2019 - 19: 10 User: adam.piggott Page Name: 1FRONT USA, Part,Page,Edition: EUR, 1 , 1

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