Xi’s tough medicine

Hong Kong has little room to deviate from China’s Covid Zero policy. [View in browser]( [Bloomberg]( Follow Us [Get the newsletter]( Chinese President Xi Jinping won’t let Hong Kong stray far from the motherland. Not on politics, not on Covid-19. If Xi’s determination to draw the former British colony closer to Beijing wasn’t already clear, his directive to Hong Kong leaders to contain surging infections removes any doubt. Xi ordered the city to take “all necessary measures” to halt omicron, a rare intervention in local affairs that came less than a day after Chief Executive Carrie Lam acknowledged the outbreak had overwhelmed her government. Key reading: - [China’s Xi Orders Hong Kong to Halt Covid Surge by All Means]( - [Hong Kong Tries to End Covid Without Resorting to Lockdown]( - [Three-Year-Old Dies as Hong Kong’s Daily Virus Cases Top 4,200]( - Virus Cases in China’s Olympic Bubble Fall Amid Covid Zero Curbs]( - [Hong Kong’s ​Covid Crisis Opens Door for China to Cement Control]( The message leaves Lam even less room to deviate from China’s Covid Zero policy, which business leaders argue threatens Hong Kong’s status as a global financial center and could deepen an exodus of talent. China has managed to quash virus outbreaks by relying on border controls and lockdowns that experts warn would be too costly for such a densely populated and internationally dependent city. The message from Xi is especially pointed given Lam has yet to declare whether she’ll seek a second five-year term next month from a panel of 1,500 electors dominated by Beijing loyalists. Xi has rarely issued public instructions on local Covid crises since ordering “government at all levels” to contain the first outbreak in Wuhan. Days later, that city was locked down and the provincial leader was fired. The intervention drives home a deeper point about the city of 7.4 million after Beijing oversaw a purge of Hong Kong’s pro-democracy opposition last year. “Asia’s world city” must look to Beijing for its future.— [Brendan Scott]( Police officers yesterday at a temporary holding area for patients displaying Covid-19 symptoms in Hong Kong. Photographer: Paul Yeung/Bloomberg Click [here]( to follow Bloomberg Politics on Twitter and share this newsletter with others too. They can sign up [here](. Global Headlines Waiting and watching | Russia announced more troops were returning to their bases after drills in Crimea, which it annexed in 2014. But western officials are cautious: The European Union’s chief diplomat Josep Borrell says despite some “encouraging signals,” allies must remain [vigilant]( because Moscow is “blowing hot and cold.” - While Ukrainian President Volodymyr Zelenskiy has downplayed the likelihood of a large-scale invasion by Russia, he is targeting what he sees as another [threat]( to his country’s sovereignty: oligarchs. - Tensions between Russia and the West continue to vex markets as [investors]( struggle to evaluate Moscow’s claim some forces are being withdrawn. Tech support | Giant technology companies facing fresh antitrust threats from President Joe Biden’s administration and Congress have an unlikely ally: the U.S. Chamber of Commerce. As [David McLaughlin]( reports, the nation’s largest business lobby, never known as a voice for Silicon Valley, has [stepped]( up attacks on the Federal Trade Commission and its chair, Lina Khan, a fierce critic of the internet giants. - The standoff in the Senate Banking Committee over Federal Reserve nominee Sarah Bloom Raskin has no quick [resolution]( in sight, leaving all of Biden’s Fed picks in limbo. U.K. inflation unexpectedly [accelerated]( for a fourth straight month in January, highlighting a brutal cost-of-living crisis that’s set to worsen this year. Annual price growth rose to 5.5%, a 30-year high. Emergency push | Canadian Prime Minister Justin Trudeau [defended]( his use of emergency powers that could freeze the bank accounts and suspend the insurance of protesters who have closed border crossings. While the move drew criticism from opposition lawmakers and civil liberties advocates, traffic reopened at demonstration sites in western Canada as protesters departed or made plans to leave. Explainers you can use - [Nationalism in China Has Dethroned Nike and Adidas]( - [What Covid Therapies Exist, and What Omicron Changes]( - [Nigerian Instagram Influencer’s Downfall Ensnares a ‘Super Cop’]( Budget weapon | The EU’s top court ruled the bloc can use tough new [powers]( to deny Poland and Hungary tens of billions of euros of aid for allegedly failing to abide by its democratic standards. The EU approved the tool last year after growing weary of challenges to judicial independence and the primacy of the bloc’s law, as well as an erosion of minority rights. Best of Bloomberg Opinion - [Putin and Biden Both Win, Ukraine Loses: Leonid Bershidsky]( - [Miners Scour the Earth Again as Reserves Dwindle: David Fickling]( - [Modest Progress Should Be Welcomed in the Middle East: Editorial]( War crimes | Tigrayan fighters committed [murder]( and rape in areas under their control in Ethiopia’s Amhara region last year, according to Amnesty International. Government soldiers have driven the rebel forces back and the United Nations has agreed to investigate possible crimes against humanity by all parties in the 15-month-long civil war. An Ethiopian soldier in the Amhara region on Dec. 11, 2021. Photographer: Amanuel SileshiAFP/Getty Images Bloomberg TV and Radio air Balance of Power with [David Westin]( weekdays from 12 to 1pm ET, with a second hour on Bloomberg Radio from 1 to 2pm ET. You can watch and listen on Bloomberg channels and online [here]( or check out prior episodes and guest clips [here](. News to Note - Iran’s foreign minister [suggested]( there could be some flexibility on its demand for guarantees the U.S. will uphold a revived nuclear deal in the future. - Brazilian President Jair Bolsonaro [meets]( Russian leader Vladimir Putin today in Moscow, where he’ll focus more on attempts to improve trade ties rather than add his voice to those seeking to end the Ukraine standoff. - Former Honduran President Juan Orlando Hernandez was [arrested]( yesterday on a request from the U.S. to extradite him on drug charges. - Stockholm-based telecom equipment manufacturer Ericsson said it may have made [payments]( to the ISIS terror organization to gain access to certain transport routes in Iraq. And finally ... The success of stars like Eileen Gu and Su Yiming has [drawn]( Chinese viewers to the Beijing Winter Olympics in huge numbers — even as countries elsewhere tune out. Almost 600 million people, or about half China’s population, have watched the event on television. U.S. broadcaster NBC, meanwhile, is looking at what will likely be the least-watched Olympics in recent history. Su wins the silver medal in Men‘s Snowboard Slopestyle. Photographer: Christophe Pallot/Agence Zoom/Getty Images Like Balance of Power? [Get unlimited access to Bloomberg.com](, where you'll find trusted, data-based journalism in 120 countries around the world and expert analysis from exclusive daily newsletters. You received this message because you are subscribed to Bloomberg's Balance of Power newsletter. [Unsubscribe]( | [Bloomberg.com]( | [Contact Us]( [Ads Powered By Liveintent]( | [Ad Choices]( Bloomberg L.P. 731 Lexington, New York, NY, 10022