Tuesday, July 2, 2024

Brussels Edition: China’s role in Russia’s War

Kyiv's allies are growing increasingly frustrated with China's support for Russia's war on Ukraine, even as Beijing claims to be a neutral actor.

Welcome to the Brussels Edition, Bloomberg's daily briefing on what matters most in the heart of the European Union.

Kyiv's allies are growing increasingly frustrated with China's support for Russia's war on Ukraine, even as the government in Beijing portrays itself as a neutral actor. They accuse China of supplying the Kremlin with parts for weapons and helping Moscow circumvent international trade restrictions. China, which has criticized the US and its allies for fueling the war by providing weapons to Ukraine, supplies Russia with a long list of dual-use components and is "no longer a neutral player," US NATO Ambassador Julianne Smith told Bloomberg TV. Finnish President Alexander Stubb told us that Russia is so dependent on China right now, President Xi Jinping could end the conflict with "one phone call."

Natalia Drozdiak and Andrea Palasciano

What's Happening

Nuclear Revival | Nuclear energy has been on the verge of a renaissance since 25 countries set a goal to help triple global capacity. Yet a dire labor shortage has hampered follow-through in Europe. In France, some companies are hiring back retirees. Read more here about how a lack of skilled workers is undermining Europe's energy transition.

German Budget | Chancellor Olaf Scholz's ruling coalition will deliver a draft budget as early as Friday that aims to put an end to political infighting by boosting spending on infrastructure and defense while adhering to debt restrictions, we're told. Negotiations have dragged on for weeks, putting pressure on the three parties in the alliance to prove they can still govern effectively after suffering severe setbacks in last month's European Parliament election.

Le Pen's Majority | Marine Le Pen is seeking support from outside her far-right National Rally party in case she falls short of an absolute majority, as mainstream parties move to block her from taking control in Sunday's French legislative election runoff. "If we're just a few members of parliament away from a majority, we'll try to go find them," Le Pen told France Inter radio.

French Murdoch | The rise of National Rally is closely intertwined with the emergence of a powerful conservative media machine backed by billionaire Vincent Bolloré, dubbed the "French Murdoch." Since he started building his media empire eight years ago, the platforms controlled by the Bolloré family have reeled in a growing audience by focusing on signature far-right issues like crime and immigration.

Orban Detente | Hungarian Prime Minister Viktor Orban pressed Ukrainian President Volodymyr Zelenskiy to consider a cease-fire during his first visit to Kyiv since Russia's invasion, putting the deep differences between the two leaders on display. Even so, Orban's visit itself represented a sort of reconciliation.

Around Europe

Green Revamp | The European People's Party is set to urge the bloc to revise its car emissions rules in order to keep the combustion engine alive past 2035. The idea is that this will help the EU boost its industrial competitiveness during the ambitious green shift. The party will also reaffirm its support for goals that would see greenhouse gases cut by 55%.

Dutch Kingmaker | The Netherlands' new cabinet was sworn in yesterday, marking the first time that Geert Wilders' far-right party has joined a Dutch government. The cabinet aims to invoke emergency legislation to limit the inflow of migrants and seek an opt-out from the EU's migration policy.

Black Sea Force | Turkey, Romania and Bulgaria have started a joint mine-hunting force in the Black Sea to increase shipping safety, and particularly to protect vessels carrying Ukrainian grain exports. The initiative is aimed at neutralizing mines that may have drifted into parts of the Black Sea as a result of the war.

Greek Summer | Island-hopping in Greece this summer just got a little easier. Hoper, the first helicopter service in Greece to offer scheduled flights, is now selling tickets to 11 destinations. Fares start at €160 for a one-way ticket, but are set to climb due to strong demand.

Chart of the Day

Euro-zone inflation slowed in June, adding to evidence that price pressures are gradually moving toward the ECB's 2% target. After trimming interest rates by a quarter-point in June, officials are determining whether inflation for the 20-nation currency bloc is moderating enough to allow for further cuts.

Today's Agenda

All times CET

  • 11 a.m. Home Affairs Commissioner Ylva Johansson speaks at launch of EU Drugs Agency in Lisbon
  • ECB forum continues in Sintra, Portugal, with speakers including Dutch central bank Governor Klaas Knot

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