New global rivalries

The shift to electric cars stokes geopolitical rivalries [View in browser]( [Bloomberg]( Welcome to Balance of Power, bringing you the latest in global politics. If you haven’t yet, sign up [here](. The US may have developed the first mass-production automobile, but more than a century later it’s China that’s leading the electric-vehicle revolution. That’s put the shift from the internal combustion engine to batteries firmly [at the heart of geopolitical rivalries](. In a world bristling with upheaval, the transition to EVs is already reshaping economies and global alliances. BloombergNEF forecasts the cumulative value of all forms of EV sales will hit $8.8 trillion by 2030 and $57 trillion by 2050 in its base-case scenario. China, with a more than 80% share of the world’s lithium-ion battery capacity, is in pole position to capitalize. US President Joe Biden has responded with his Inflation Reduction Act armed with billions of dollars to lure producers to America and its key trading partners. Yet while Western automakers are expanding fast in Mexico to sell EVs across the northern border, Chinese firms are ramping up sales to local consumers. In Thailand, which Japanese investment helped turn into a global auto-making powerhouse, Chinese money is pouring in to build EVs. With the bulk of today’s battery minerals supplied by exporters like China, Chile, Indonesia and the Democratic Republic of the Congo, the search is on for alternative sources. Canada’s so-called “Ring of Fire,” a landscape of rivers and pine forests in the far north loaded with nickel, copper, chromite and platinum, would be a natural source for the US industry. But development faces environmental concerns: The area of peat and wetlands stores an estimated 35 billion tons of carbon ever year. The realignment appears unstoppable nonetheless, as the need to end our addiction to fossil fuels becomes ever more urgent. Last month [was the warmest October on record](, scientists say, and 2023 is “virtually certain” to be the hottest year ever. For the winners and losers in the EV race, the stakes are enormous. — [Karl Maier]( A copper-cobalt artisanal mine near Kolwezi in Congo on June 20. Photographer: Arlette Bashizi/The Washington Post/Getty Images Global Must Reads Israel said its troops have entered the “heart” of Gaza’s main city, as they continue [their operation to destroy]( Hamas. Israel describes Gaza City as the “center of gravity” of Hamas’s operations and is determined to end the militant group’s rule over the strip following its Oct. 7 attack on southern Israeli communities, which killed around 1,400 people. Citizens search through destroyed buildings after Israeli air strikes in the Gaza Strip yesterday. Photographer: Mohammad Zanoun/AFP/Getty Images Democrat victories in state elections yesterday in Virginia, Kentucky, Ohio and Pennsylvania are a sign that the party’s messaging, particularly around abortion rights, is resonating with voters. The wins [are a major boon]( for Biden’s bid for reelection next year, as his party for a second time during his term in the White House bucked historical trends by fending off anticipated Republican surges in mid-cycle elections. By embracing Hamas and denouncing Israeli bombardments, Prime Minister Anwar Ibrahim is tapping into growing anger in Malaysia over the war in Gaza. But as Philip Heijmans and Niluksi Koswanage show, his moves to [stoke anti-Israel sentiment]( are also intended to endear him to the nation’s Malay majority at a time when his coalition is being challenged by a pro-Islamic opposition. An Indonesian presidential contender is facing a growing backlash over his decision to choose President Joko Widodo’s son as his running mate, with the latest opinion poll showing him slipping to second place after six months of being the leading candidate. Defense Minister Prabowo Subianto’s drop in support suggests voters are [becoming uncomfortable]( with what’s seen as the president’s attempts to establish a political dynasty. War, geopolitical tension and inflation were among the risks political and business leaders identified at the Bloomberg New Economy Forum in Singapore today. But there were [also glimmers of optimism]( that some of the tensions gripping the globe could abate. “Pragmatism is surfacing,” Khalid Al-Falih, Saudi Arabia’s minister of investment, said of the increasing exchanges between the US and China. Biden will hold bilateral talks with Chinese President Xi Jinping on Nov. 15 [on the sidelines]( of the Asia-Pacific Economic Cooperation summit in San Francisco, Kyodo News reported. The European Union’s executive arm will recommend formally [opening membership talks]( with Ukraine and Moldova and proceeding to the next steps in the accession process once they complete a series of reforms. Portugal’s Antonio Costa unexpectedly quit after eight years as prime minister after [revelations about an investigation]( into possible government corruption involving lithium and hydrogen projects. German authorities classified the Alternative for Germany in the state of Saxony-Anhalt as [right-wing extremist](, the second regional branch of the party in the former communist east to be categorized as such. Washington Dispatch The third Republican presidential debate in Miami tonight will be watched [for the interaction]( between Florida Governor Ron DeSantis and Nikki Haley, a former United Nations ambassador and governor of South Carolina. She has been drawing closer to displacing him in national polls as ex-President Donald Trump’s top challenger. Yet time is running out: Trump remains far ahead of both of them in surveys, and the first votes will be cast, at the Iowa caucuses, in January. Former New Jersey Governor Chris Christie, Ohio entrepreneur Vivek Ramaswamy, and Senator Tim Scott of South Carolina will also participate. The debate topics will likely include the Israel-Hamas war and whether to continue to provide assistance to Ukraine as it battles Russian invaders — and what to make of Republican defeats in yesterday's off-year elections. Trump plans to hold a rally near Miami, in Hialeah, at the same time as the debate. One thing to watch today: Ivanka Trump is expected to testify in the fraud trial of her father and the family business. [Sign up for the Washington Edition newsletter]( for more from the US capital and watch Balance of Power at 5pm ET weekdays on Bloomberg Television. Chart of the Day The US will provide $553 million in financing for a port terminal in Sri Lanka’s capital being developed by Indian billionaire Gautam Adani, as New Delhi and Washington look to curtail China’s influence in South Asia. The deepwater facility in Colombo is the DFC’s largest infrastructure investment in Asia, and part of a [global acceleration in funding]( by the American agency. And Finally When air raid sirens sound in western Ukraine’s Lviv region, production lines at Nestle come to a halt as staff decamp to the [bomb shelter](. By the time it’s safe to come out, candy bars sitting in the open are no longer fresh and must be recycled as wafer filling. Russia’s invasion means companies in Ukraine must contend with power cuts and air raids, declining consumer demand and staffing shortages as workers join the fight or flee the country. Communal workers at a crater outside an art museum in Odesa on Monday. Photographer: Oleksandr Gimanov/AFP/Getty Images More from Bloomberg - [Middle East Briefing](, a weekly look at what’s happening in the region and where it’s heading - [Bloomberg Opinion]( for a roundup of our most vital opinions on business, politics, economics, tech and more - [Next Africa](, a twice-weekly newsletter on where the continent stands now — and where it’s headed - [Economics Daily]( for what the changing landscape means for policy makers, investors and you - [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? 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