China’s growing muscle at the UN

0:03Good morning from the Financial Times. Today is Monday, July 28th, and this is your FT News briefing. The U.S. and the EU have a trade deal. And public companies are loading up on cryptocurrencies. Plus, a U.S. rival is stepping in to fill a new void at the United Nations. China is in a very good position to take advantage of these huge reforms going on. I'm Jess Smith, and here's the news you need to start your day.

0:45Markets open the week with news of yet another U.S. trade deal. After weeks of difficult discussions, the leaders of the U.S. and the European Union yesterday reached an agreement. The U.S. will impose 15 percent tariffs on most imports from the European bloc. Not only that, the EU also agreed to spend hundreds of billions of dollars on additional American energy products and weapons. The deal is a victory for U.S. President Donald Trump. He spent months locked in bruising negotiations with America's trading partners. He'd threatened 30 percent tariffs on the EU if no deal had been struck by August 1st.

1:27It's one of the hot trends in global markets right now. Companies issuing shares or bonds in order to buy Bitcoin and other cryptocurrencies. cryptocurrencies. Companies are loading up on these digital coins in the hopes of pumping up their stock price. The FT's Niko Asghari has been looking into this, and she joins us now to talk more. Hi, Niko. Hi. So companies have been buying Bitcoin for a while now. Can you talk about what or who is fueling this trend? Well, the one name that might be familiar is Michael Saylor, a crypto billionaire, a crypto evangelist of this company called Strategy, who in 2020 started buying lots and lots of Bitcoin.

2:07He has a software company, but the software parts really are relevant. He's just bought loads of Bitcoin and built this company into a$100 billion business. And after doing that, lots of companies over the past year or so have copied it, essentially, started also buying lots of Bitcoin. But now what we're seeing is these companies are buying different tokens, whether it's Ether or Litecoin or Hype token, almost you name it, and there's a company out there that's buying it. And they're doing this because they want to differentiate themselves, because there are so many businesses now that are holding Bitcoin.

2:41They want to stand up and say, hey, we're the only one or the biggest one doing Litecoin. And that makes us different. And that makes us interesting. And you should invest in us. And the way companies invest in these cryptocurrencies is to issue shares or bonds to investors, saying they're going to use the funds for cryptocurrency purchases. Nico, can you talk a bit more about how this transaction works? So there's two typical ways. You're either a listed company, say you're a biotech or a semiconductor maker. And usually these are companies that their shares haven't been doing great recently.

3:14And they've decided, you know what, we're going to buy one of those coins that you mentioned. And in announcing that and saying, hey, we're going to buy ETH. The share price of these companies has jumped so much, some of them as much as 200%. The other way is that there's special purpose acquisition vehicles, SPACs. If you cast your mind back about two, three years ago during the pandemic, where there was a huge boom in SPACs, they're sort of coming back. And these are shell companies that are listed, but they have no actual business. And they are now also saying, hey, our business is going to be just buying loads and loads of crypto.

3:51Are there any concerns about the risks for investors? Yeah, lots of huge concerns. The main concern is that the price of these crypto tokens could fall, could crash, and therefore the price of the companies could also crash because the share prices are really just trading off and are a reflection of how much crypto they're holding. But then there's a sort of secondary issue, which is that a lot of these companies, again, following in the footsteps of Michael Saylor, are raising debt and issuing more equity, tapping the public markets and using all the money that they raise to buy more crypto. And if the prices of the crypto that they hold falls, it's a sort of vicious downward spiral if everything starts to crumble.

4:33Where do you see this trend headed? Onwards and upwards, it seems. I mean, every single one of the businesses, the investors that I've spoken to has said that, you know, it's working so far. You buy crypto, your share price goes up. So why stop? And the aim of a lot of these companies is just to keep buying and keep the momentum going. some of them plan to then use the crypto that they're holding to sort of become more into crypto companies do crypto financial services or lending which sort of raises the question of why as a biotech are you doing that it seems to at the moment the trend is only going one way which if the prices fall it will be a dangerous downward spiral.

5:13Niku Asghari covers cryptocurrencies for the FT. Thanks Niku. Thanks.

5:24The U.K. is exporting far fewer goods than it used to, at least as a share of total exports. An FD analysis of government data found that from May 2024 to May 2025, goods like cars and chemicals accounted for only around 40 percent of British exports. And that's a record low. Lower oil prices may have dragged down the value of British energy exports. and analysts also point to Brexit, which created trade barriers between the UK and its biggest trading partner, the EU. But while exports of goods continues to fall, British service exports, like financial services and management consulting, are surging.

6:10The Trump administration has been cutting foreign aid and pulling back from the United Nations. and China is stepping in to fill the gap and expand its influence in the multilateral organization. The FT's Mercedes Rule has been reporting on this from Geneva, and she joins me now. Hi, Mercedes. Hello. So before we talk about China, let's just talk about the changing U.S. role at the U.N. What's been happening since the beginning of the year? The U.S. role under Trump's second term, we're seeing a huge pullback in terms of foreign aid. There were announced big plans to overhaul, for instance, USAID.

6:48You're seeing reduced presence in areas from like war zones to developing countries with famine. So in addition to rolling back significant assistance from USAID, the Trump administration has also massively shrunk what it gives to a lot of UN organizations. What is China doing exactly to grow its influence, the UN now? None of this is quite new in terms of China wanting to grow its presence and its influence. What it has seen and what we've seen this year is a bit more of a concerted push by China to push its agenda a bit more aggressively. That's included things like personnel, getting voting coalitions, particularly with developing countries from the global south, African countries.

7:40In some cases, financial contributions, but these are a bit less than what you have seen typically with the U.S. What are some of the other specific changes you're seeing that give some clues about China's strategy for expanding its United Nations presence? Yeah. So the thing to note is China's been proactive around an overhaul called the UN-80 initiative. And this is a very radical restructuring at the U.N. that has been triggered basically by this U.S. pullback. And where we in particular see interest is at the International Telecommunication Union, which sets global communication standards, the ITU, but also the World Health Organization.

8:23How are other UN members responding to China's maneuvering? I think the first thing also to note on China is that not all of this is necessarily is bad. I think there's certainly a feeling that other countries stepping in to fill the gap or attempt to fill the gap with a vacuum led from the US is not a bad thing at all. But I guess what is concerning a couple of countries, and particularly in Europe, what's China hoping to achieve by having more of a voice? I mean, for instance, on human rights, China would like to see less focus on that and what's going on domestically in China with the Uyghurs, for example.

9:03But you're certainly seeing that China is no longer a passive participant. It's, you know, it's more of an assertive actor and it's embedding itself within these key institutions to maybe influence global norms and priorities. Mercedes Ruhle is the FT's Switzerland and Austria correspondent. Thanks, Mercedes. Thanks very much.

9:30And finally, China's Shaolin Temple is famous for its martial arts. But this past weekend, the man credited with building the Shaolin global brand was placed under investigation. It's not the first time the so-called CEO monk has been in the limelight for his financial conduct and lavish lifestyle. In a statement regarding these latest charges, the temple said Abbot Shiyongshin is suspected of improper relationships, embezzling project funds and, quote, seriously violating Buddhist precepts. You can read more on all these stories for free when you click on the links in our show notes. This has been your daily FT News briefing.

10:11Check back tomorrow for the latest business news.

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