US billionaires bankroll Republican election push

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0:32Good morning from the Financial Times. Today is Wednesday, September 16th, and this is your FT News Briefing. Can the U.S. and China tackle AI risks together? And megadonors are backing Republicans in the midterm elections. Plus, we look at Africa's biggest IPO. It's hard to understate how much of a big deal this is for Nigeria, but also for Africa more widely. I'm Sonia Hudson, in for Mark Filipino, and here's the news you need to start your day.

1:13Tech companies and think tanks in China and the U.S. have held unofficial talks on mitigating AI risks together. Top AI executives have been warning in the past week that humans could lose control over AI if they innovate too quickly. People involved in the U.S.-China discussion said the companies and think tanks had those same concerns. But the tech rivalry between the two countries makes it difficult to agree on guardrails. The talks come ahead of a summit later this month between U.S. President Donald Trump and China's leader Xi Jinping. But people familiar with the discussions inside the U.S.

1:51government said they had very low expectations for the leaders to agree on anything substantial regarding AI.

2:05America's mega donors are overwhelmingly backing Republicans in this year's midterm elections. That's according to a recent analysis by the FT. Republicans currently hold a slim majority in the House and a wider one in the Senate. Can the influx of cash help them keep control? Ian Hodgson is a data reporter for the FT. He's been crunching the numbers on this. Hi, Ian. Hey, Sonia. So just give us a bird's eye view to start. How important are megadonors in this election and who are they backing? Yes. So far this cycle, about$2.8 billion has been raised by various campaigns and super PACs. And if we just look at the top 20 of the biggest mega donors, they already account for over one third of that$2.8 billion.

2:5216 of those are predominantly giving to Republican-leaning super PACs. The only one of our top 20 who was predominantly on the Democratic side was George Soros, who's, you know, a longtime Democratic donor. How unusual is this? Yeah, so when I talk to experts, it sounds like this is sort of a minor aberration from the trend. Mega-donor money has been going up cycle after cycle. But what really stood out to the experts I talked to is just how tilted it is towards Republicans this cycle. Tell me about some of the particular issues that these mega donors care about. Right. So there's a subset of the donors who are really interested in those issues that sort of impact their own bank accounts.

3:40I mean, there's been tremendous amount of wealth created in the tech, AI and crypto spaces at the exact same moment that Congress is making decisions worth an enormous sum to those industries. So you have people like Chris Larson from Ripple, Mark Andreessen, Ben Horowitz, tech venture capitalists who are giving to PACs that are, you know, laser focused on candidates who have been outspoken critics or supporters of those issues that matter most to them. Ian, there are more than 30 contested House and Senate races across the U.S. this fall. We also had a really interesting primary election cycle earlier in the year.

4:22Does it look like the megadonors are making a difference in any of those races? Yeah, that's a really good question. And it is difficult to tell the impact that any one megadonor would have on a race. I mean, one of the things that we can say is that big spending doesn't always guarantee the result that you're looking for. You know, Florida's 19th district comes to mind where you have Jeff Yass, who donated to Protect Freedom PAC. That PAC deployed about$2.2 million to support a former Trump administration appointee, and she ended up losing the race by about seven points. Are you seeing any trends in the data in terms of how big donor involvement is changing?

5:02Yeah, that's a great question, too. I mean, what we can see so far for the key mega donors that have been very active this cycle, they're donating more and they're donating more early. And part of that could be that the PACs they're interested in are getting more involved into primary races where their dollars can actually be more effective. And part of it is they're just giving a lot of money to Mega Inc., which is Donald Trump's super PAC that supported his last presidential run and has already accumulated about$400 million. What's interesting about that is that Mega Inc. has been very obscure about how it plans to deploy that money.

5:40And so the experts I talked to have said, you know, donating to Mega Inc. is more about sort of being visible on Trump's radar than it is really about trying to influence one race or another. Ian Hodgson is a data reporter for the FT. Thanks, Ian. Thank you.

6:01EU governments are pouring cold water on Canada's proposal to build a, quote, unique alliance. Canadian Prime Minister Mark Carney told the FT he hopes banding together would make them less reliant on trading with the U.S. and China. But five EU diplomats involved in trade talks say the bloc is wary of giving Ottawa preferential trade access. Carney in recent months has focused on collaborating with other nations to fight the Trump administration's aggressive foreign policy. Canada is one of only two countries that imposed retaliatory tariffs on the U.S. in response to Trump's trade war.

6:47Africa's largest IPO is underway. Nigeria's Dangote Petroleum Refinery is attracting a lot of fanfare from locals who have rushed to buy in because of the low entry price. The company is expected to list on Nigeria's stock market this fall. So what will that mean for the country's economy? Jacob Judah is the FT's West Africa correspondent, and he joins us now. Hi, Jacob. Hi. So can you start off by telling me about this IPO and why it's become so significant? Yeah, it's hard to understate how much of a big deal this is for Nigeria, but also for Africa more widely. I mean, from a raw financial perspective, the numbers basically speak themselves.

7:27It's the biggest IPO in Africa's history by some margin. It's going to help underwrite doubling the capacity of the refinery to 1.4 billion barrels a day, which is going to make it even more important than it already is a global energy security. But from a Nigerian perspective, I mean, what's exciting people here is the cost of entry. I mean, Nigerians are able to invest from as little as 10 shares, and each share costs roughly the same amount as buying a bottle of Pepsi. So Aloko Dengote, the multi-billionaire owner of the refinery, he says he wants 10 million Nigerians to invest, and he's dubbed it the people's IPO.

7:59And why is Dengote so intent on pricing this cheaply? So I think it's a mix of factors. One is I think he wants as many Nigerians as possible with all the carryouts of, you know, obviously farmers are going to have a hard time investing in this. But he wants as many Nigerians to invest as possible to give them a sense of ownership. But more widely, N 'Gose has become a symbol of Nigeria's kind of economic turnaround, at least in the past year. And he's hoping to spread the optimism to his refinery, to make the refinery the defining symbol of how Nigeria has turned around. out. What have you been hearing from Nigerian investors or potential investors about the stock sale?

8:38So Nigerian investors are on the whole universally optimistic about it, even perhaps too optimistic about it. But the one thing in Lagos is that basically anyone who's anyone in Nigerian broking, finance, banking is involved in some way, shape or form with this IPO. But when you get outside of that world and you go and speak to ordinary Nigerians, what I found actually was that a lot of people don't really seem to be that familiar with the IPO. I went, for example, to go and stand outside the refinery to speak to truckers who actually work for Dangote. And a lot of them had absolutely no idea about it.

9:13I mean, I spoke to a fisherman, for example, who was frustrated, but he hadn't heard about it. He was waving around a kind of brick phone saying, how the hell would I find out about this? I mean, I spent all my time fishing, but my sense is that that will all come. I mean, there had been, obviously, advertising restrictions on it that are now being lifted. And the IPO will be open until the middle of October. So there's still a month for Nigerians to learn about it, to hear about it, and ultimately to decide to invest. Well, we'll see if Dengote can get to those 10 million investors. But just taking a step back here, what kind of impact do you think this IPO could ultimately have on the Nigerian economy?

9:52It could have a big impact. I mean, one banker here put it to me this way, that this is the greatest marketing opportunity the Nigerian economy has had abroad in years. But there are other reasons as well. I mean, this also proves to other African entrepreneurs, many of whom have tried to emulate and follow Dangote, that a path to raising significant equity domestically exists. There's one maxim here, which is where Dangote goes, others follow. And many people here seem to think that others will become a bit more emboldened after seeing Dangote list on the Nigerian Stock Exchange. Jacob Judah is the West Africa correspondent for the FT.

10:28Thanks, Jacob. Thank you.

10:34You can read more on all these stories for free when you click the links in our show notes. This has been your daily FT News Briefing. Check back tomorrow for the latest business news.

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