FirstFT: Xi-Putin’s ties on display at the Kremlin

Good morning. Today we start with Chinese president Xi Jinping’s meeting with his Russian counterpart Vladimir Putin in Moscow, where the two leaders promoted China’s peace plan to end the war in Ukraine.

Putin welcomed the 12-point plan, which he praised for following “principles of fairness”. Xi returned the warm welcome, endorsing Putin’s “strong leadership” — and both called each other a “dear friend”.

Since Russia’s full-scale invasion of Ukraine last year, China has provided an economic lifeline to Russia that has eased the pain from western sanctions. Xi’s peace plan, meanwhile, largely repeats the talking points the Kremlin has used throughout the war, without condemning Putin’s invasion or calling on him to withdraw troops.

The US, which is Ukraine’s most important ally, has said China’s peace plan amounts to “the ratification of Russian conquest” by calling for a ceasefire that would solidify Russian occupation of Ukrainian territory.

Kyiv, however, has avoided criticising the plan ahead of an expected call between Xi and Ukraine president Volodymyr Zelenskyy, which would mark the first time they have spoken since the war began in February last year.

Here’s what else I’m keeping tabs on today:

• German official visits Taiwan: Bettina Stark-Watzinger, federal minister of education and research, is due to arrive in Taipei as the first German federal minister to visit Taiwan in 26 years.

• Nato annual report: Nato secretary-general Jens Stoltenberg presents the defence alliance’s report at its headquarters in Brussels.

• Federal Reserve meeting: The outlook for the Fed is no longer so clear following the collapse of Silicon Valley Bank. Investors will be closely watching policymakers’ two-day meeting, which begins today.

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Five more top stories

1. US bank chief executives are searching for a new plan for First Republic after a $30bn lifeline failed to stop a sharp sell-off in the lender’s shares. Shares of First Republic, which have fallen by almost 90 per cent this month, were down by 47 per cent at the close of the US markets on Monday. Here’s what else to know about the US bank chaos:

• Federal regulators have extended the bid deadline for the failed Silicon Valley Bank.

• Shares of New York Community Bank jumped 30 per cent after one of its subsidiaries agreed to buy most of Signature Bank, the failed crypto-focused lender.

2. Credit Suisse bondholders were in uproar yesterday and the European Central Bank raised concerns after the rescue deal by rival UBS wiped out $17bn of the failed Swiss bank’s bonds. “In my eyes, this is against the law,” said a fund manager at Aquila Asset Management who invests in additional tier 1 (AT1) bank debt.

3. Chinese property developer Evergrande has released a new timeline for its restructuring process, after repeatedly missed its own self-imposed deadlines. At a Hong Kong court hearing yesterday, the company said that it would release a term sheet on Wednesday.

4. The IMF has backed a $3bn bailout for Sri Lanka to help the country restructure its debts and relieve a “catastrophic” economic and social crisis. The deal on the bailout was finally reached after resistance from China was overcome earlier this month.

5. Exclusive: Big Pharma has asked for a slice of the US’s $280bn chip industry support package as part of an effort to build up the country’s biotechnology industry and stave off Chinese competition. Read more about the tax breaks and subsidies that drugmakers are requesting.

The Big Read

As the global pandemic halted travel and shut borders in 2020, two of Asia’s biggest financial centres saw an opportunity. Hong Kong and Singapore saw a chance to challenge the existing offshore centres such as the Cayman Islands and shift the global centre of gravity for world’s the wealthiest families.

We’re also reading . . . 

• Xi-Putin: Behind the talk of peace, the substance of the Xi-Putin summit will push in the opposite direction, writes Gideon Rachman. It will involve increased Chinese support for Russia, as it wages a war of aggression.

• Wirecard scandal: Like his grandson Jan, the mastermind of the Wirecard fraud, Hans Marsalek was suspected by Austrian authorities of being a Russian spy.

• Credit Suisse rescue: An unmissable play-by-play of how the Swiss National Bank, regulator Finma and minister of finance forced UBS to save Credit Suisse.

Graphic of the day

The world is “more likely than not” to miss its target to keep global warming to 1.5C in the near-term, according to a new UN report. Climate change already taking place will continue across the lifespan of three generations born in 1950, 1970 and 2020 — as shown below. Some regions have already reached the “limits” of what they could adapt to.

Take a break from the news

What’s behind the success of the “cleanfluencers”? They dispense housekeeping tips to millions of social media followers — but that’s only part of their appeal, writes Jessica Salter.

Additional contributions by Gordon Smith and Tee Zhuo