Quieter in China

President Xi Jinping’s anti-spying crackdown is having another knock-on effect. [View in browser]( [Bloomberg]( President Xi Jinping’s anti-spying crackdown is having another knock-on effect on China’s $18 trillion economy: It’s making investor meetings boring. More than a dozen foreign bankers, economists and businesspeople returning to China after three years of closed borders told Bloomberg News that bland party speak is increasingly replacing the frank conversations with officials that they enjoyed before the pandemic. Key Reading: [Investors Visiting China Find Officials Fearful of Upsetting Xi Bankers Forced to Study Xi’s Thoughts as Party Tightens Grip]( [Xi Calls for More Economic Opening, Trade as Recovery Falters]( [China’s Spy Agency Takes to WeChat in Espionage Crackdown]( That’s down, in part, to an expanded anti-espionage law that has made officials more fearful of saying the wrong thing as China becomes more wary of the US and its allies. Now dinner party invitations are being declined, with potential ethics breaches cited as the reason, and economists are refusing to talk about key issues like deflation. In some cases, it’s hard to get meetings at all: Face time with officials from China’s Central Bank has either been harder to get, or is now simply unhelpful, sources say. At the same time, employees at many Chinese state-owned — and some private-sector — companies are being made to attend study sessions on Xi Thought, a guiding philosophy spanning nearly every aspect of Chinese life that prioritizes the work of the ruling Communist Party. To comply, many businesses have hired experts and academics to instruct staff. Employees at one Beijing-based government-owned energy company reported being dragged into surprise talks on the Chinese leader’s principles at an isolated facility where their mobile phones were sometimes confiscated. Adding to the paranoia is Baomiguan, an app for “Views on Secret Keeping,” on which employees are increasingly being asked to take regular training about state secrets. Between the study sessions and anti-espionage training, Chinese employees might have another reason to turn down meetings with overseas visitors: They just don’t have the time. [— Jenni Marsh]( Buildings in Shanghai on June 21. Photographer: Raul Ariano/Bloomberg Check out the Bloomberg Politics [webpage](, and if you are enjoying this newsletter, sign up [here](. Global Headlines The UK is headed for five years of [lost]( economic growth as the government fails in its goal to “level-up” the country’s regions and reduce inequality, forecasts from the London-based National Institute of Economic and Social Research show. The report is bad news for Prime Minister Rishi Sunak’s Conservatives as they ready for a general election likely in 2024, with NIESR warning that the government is continually spending more than it earns, constraining growth and the scope to offer voters tax cuts or other sweeteners. - British consumer brands are facing scrutiny of their efforts to cater to socially conscious customers amid signs that the UK is falling prey to a backlash against so-called [woke]( capitalism, Dasha Afanasieva reports. A US plan to restrict investment in China is likely to apply only to Chinese companies that get at least half of their revenue from cutting-edge sectors such as quantum computing and artificial intelligence, sources say. The provision would [limit]( the scope of an executive order the Biden administration is expected to unveil in the coming days as part of a push to limit Chinese access to sensitive technology. - President Joe Biden said he plans to travel to Vietnam soon as the US seeks to [bolster]( its ties with Asian nations and reduce China’s influence on the region. July was officially the earth’s [hottest]( month on record, causing the Antarctic to shrink at a record pace and the European Union’s observation agency to warn of “dire consequences” as extreme weather events grow more frequent. Last month was about 1.5C warmer than the average for 1850 to 1900, the first time global July temperatures have exceeded the 1.5C preindustrial threshold set in the Paris Agreement. Typhoon Khanun is on track to [deliver]( an “extremely powerful” impact, authorities in South Korea warned, amid forecasts it will barrel up the country and toward the capital Seoul that’s home to about half the population. The nation hasn’t previously experienced a tropical cyclone that’s pierced right through the inland and crossed into North Korea, according to records that date back to 1951, the Korea Meteorological Administration said today. Best of Bloomberg Opinion - [The Incredible Shrinking Global Sea Powers: Adrian Wooldridge]( - [DeSantis and the Wrong Way to Go Medieval: Howard Chua-Eoan]( - [TSMC Is the Global Chipmaker It Didn’t Aspire to Be: Tim Culpan]( Turkish President Recep Tayyip Erdogan said he aims to revive the deal that allowed Ukraine to export grain via the Black Sea with an “[expanded scope](,” calling on western countries to help turn the initiative into the basis for peace between Russia and Ukraine. Contacts to restart the initiative are ongoing, but a solution depends on western countries “fulfilling their promises,” he added, without specifying which commitments had been broken. - Read our rolling coverage of the war in Ukraine [here](. Explainers You Can Use - [All About the New Obesity Drugs Causing a Big Stir]( - [Chinese EVs Are Now Cheaper Than Gasoline Cars]( - [What Are Stablecoins and Why Is PayPal Jumping In?]( Rome just took a sharply populist turn under Prime Minister Giorgia Meloni, who is launching an assault on bank profits and vying to tighten her far-right government’s [grip over corporate Italy](. The prime minister is doubling down on a state-led approach to managing prosperity with a raft of measures that wiped out about $10 billion from the market value of Italian banks and is threatening to overshadow relations with China. Tune in to Bloomberg TV’s Balance of Power at 5pm to 6pm ET weekdays with Washington correspondents [Annmarie Hordern]( and [Joe Mathieu](. You can watch and listen on Bloomberg channels and online [here](. News to Note - Ohio voters [overwhelmingly rejected]( a measure seen as a test over abortion rights a year after the US Supreme Court overturned Roe v Wade. - An estimated 42% of adult Japanese women may end up [never having children](, the Nikkei newspaper reported, citing a soon-to-be-published estimate by a government research group. - Mexican opposition frontrunner Xochitl Galvez is [narrowing the gap]( with the candidates of the ruling Morena party, who are the favorites to win next year’s presidential election, according to a poll. - Indonesia is again delaying the opening of a Chinese-funded [high-speed train](, citing safety concerns. - Most countries in Europe are paring their [army of firefighters]( even as the continent battles increasingly intense heat waves that have already stoked wildfires in Greece and Portugal this summer. And finally … Luiz Inacio Lula da Silva rose to political prominence as a labor organizer in the auto plants of Sau Paulo in the 1970s. Now in his third term as president, Lula is keen for carmakers to take the lead in his program to bring back manufacturing to Brazil. It’s a [project]( with echoes of Biden’s industrial policy for America — only, as Simone Iglesias and Leonardo Lara report, Lula is looking to China rather than the US to help with reindustrialization. Lula speaks during a conference with international correspondents in Brasilia. Photographer: Arthur Menescal/Bloomberg More from Bloomberg - [Washington Edition]( for exclusive coverage on how the worlds of money and politics intersect in the US capital - [Economics Daily]( for what the changing landscape means for policy makers, investors and you - [Supply Lines]( for daily insights into supply chains and globe trade - [Bw Daily]( for unique perspectives, original reporting and insightful analysis from Businessweek’s renowned journalists - [Green Daily]( for the latest in climate news, zero-emission tech and green finance Explore more newsletters at [Bloomberg.com](. Follow Us Like getting this newsletter? [Subscribe to Bloomberg.com]( for unlimited access to trusted, data-driven journalism and subscriber-only insights. Want to sponsor this newsletter? [Get in touch here](. You received this message because you are subscribed to Bloomberg's Balance of Power newsletter. If a friend forwarded you this message, [sign up here]( to get it in your inbox. 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