China

James Gorman, the chief executive of Morgan Stanley, neatly summarised his view of US authorities’ so-called “princeling” probe, into whether rival bank JPMorgan sought to win deals in China by hiring the sons and daughters of the country’s elite.

“There are a lot of talented people that come from those families,” Mr Gorman told CNBC, in a television interview on the sidelines of the World Economic Forum in Davos, Switzerland. Full story on FastFT

By Martin Arnold, Banking Editor, in Davos

The first of many debates about China at Davos this year made an unexpectedly hostile debut this morning as Zhang Xin, head of Beijing’s biggest property developer Soho, was put on the spot over the country’s crackdown on corruption.

“Your industry is one of the most corrupt in China,” said moderator Andrew Browne, China editor of the Wall Street Journal, as he asked Ms Zhang to share her views on the issue. Read more

By Gideon Rachman
The official theme for this year’s World Economic Forum is predictably bland – “Reshaping the World”. But the unofficial slogan will be “America is back”. Predictions that the US economy will grow by 3 per cent this year – added to worries about emerging markets – mean that Davos is likely to be bullish on America for the first time in years.

 

One of the most popular slang terms in China these days is tuhao, sort of a cross between “vulgar tycoon and “nouveau riche”. Think Beverly Hillbillies, China-style.

These days China needs these hillbillies and their spending power more than ever. The economy, as figures released on Monday show, is again more reliant on investment than it is on consumption – nearly a decade after it began talking about rebalancing. Read more

♦ Borzou Daragahi on how the excesses of the extremist group Isis – the Islamic State of Iraq and the Levant – have sparked an armed rebellion against it in its northern Syria stronghold.

♦ Jamil Anderlini argues that modern China needs to set up its own House of Lords to improve governance.

♦ In a world with more inherited riches, it makes no sense to cut estate taxes, writes Robin Harding.

♦ A handwritten poster at a Seoul university has struck a nerve, prompting a wave of copycat banners airing grievances across South Korea. Young-Ha Kim explains the craze in The New York Times.

♦ Bangladesh’s leaders must deliver on the most basic promises of democracy – or they will prove Henry Kissinger right, says Tahmima Anam in The Guardian. Read more

By Gideon Rachman
Can thinking about the past improve the way you handle the present? If so, this year’s centenary of the outbreak of the first world war could do the world a great service by persuading modern politicians to spend more time thinking about Sarajevo, and less time worrying about Munich.

Gideon Rachman

At the end of every year, I attempt a first draft of history by listing what seem to me to be the five most significant events of the past twelve months. Some of my picks for 2013 also featured in 2012. I hope this is not because of intellectual laziness, but simply because the war in Syria, and the turmoil in Egypt remain defining events of our era. I probably should also once again include the tensions between China and Japan – but they are still simmering and have not yet boiled over. So I’ll give the Senkaku-Diaoyu islands a rest this year.

So let me start the list for 2013 with a genuinely new event that has global significance: Read more

China and Japan in the struggle of the century
Aerial posturing over disputed territories in the East China Sea has caused concern among the international community. After China declared an air identification zone over the Senkaku/Diaoyu Islands, the US despatched two B-52 bombers in an apparent show of defiance, but has instructed its civilian airlines to respect the zone. In this week’s podcast, Gideon Rachman is joined by Jamil Anderlini, Beijing bureau chief, and Geoff Dyer, US foreign policy correspondent to shed light on the situation

• After meeting Hossein Shariatmadari, editor and commentator of Iran’s hardline Kayhan newspaper, the FT’s editor Lionel Barber says the conversation was a reminder that not all Iranians want a nuclear deal and that Iran’s “fractious relationship” with the rest of the world may not be about to end.

• An EU’s “Eastern Partnership” summit is trying to save hopes of a future deal with Ukraine. Russia’s tactics towards ex-Soviet countries preparing to do EU deals have raised questions over the future of an agreement and caused tensions between EU members, reports the FT. Read more

By Luisa Frey

♦ Fears of an accidental conflict are growing following China’s creation of an air defence zone over the Japanese-administered Senkaku islands it claims as its territory, with the US seeing the move as a provocative step, writes the FT’s Demetri Sevastopulo. Read more