The thrilla in Manila with threat of flotilla

Plus: Pork or electric vehicles? [Bloomberg]( This is Bloomberg Opinion Today, a formidable armada of Bloomberg Opinion’s opinions. [Sign up here](. Today’s Must-Reads - Big Tobacco’s [mortal Zyn.]( - Give [Meloni]( her due, for a while. - A [victorious Labour]( won’t touch this. - The EU shouldn’t stop fighting [climate change](. - Modi should let [India’s states have their rights](. - Shaken and stirred by a [London tunnel](. - Stepping in time with the [Bank of Japan](. - Will [France become Italy](? Who Really Loves Ya, Manila? The last column I wrote about the South China Sea involved dolls: Vietnam had just [banned the movie]([Barbie]( because a map that briefly appeared on the screen showed China’s claims to controversial islands in that waterway. There was no violence involved. Not so this time. China and the Philippines had a run-in this week over outcroppings in the sea — specifically the Second Thomas Shoal, which Filipinos call Ayungin and Chinese ren’ai jiao 仁爱礁, or “kindness reef.” The Vietnamese name is Bãi Cỏ Mây, but Hanoi wasn’t part of this skirmish. There is no land to be fought over since the reef is submerged. Manila’s navy purposely stranded a landing craft — the Sierra Madre — on the shallow waters in 1999 to demarcate its claim, shipping food and necessities to sailors assigned onboard. In the June 17 event, the Chinese seized guns and emptied supply boats from the Philippines; in the melee, a Filipino seaman lost a finger. It doesn’t quite trigger the mutual defense treaty that would require the US to come to the aid of its ally — but things are getting closer to a red line, as Andreas Kluth [notes](. China has been using artificial intelligence to target Philippine ships and to figure out when to deploy vessels against their rival. Karishma Vaswani says Manila and Washington should use AI, too. “Artificial intelligence can help take away some of the unknowns in an already volatile situation. Forecasting would allow the Philippines and its allies to track Beijing’s movements, game out strategies and take protective action to try and avoid another clash,” [she wrote](. “We need to avoid a full-blown conflict at all costs, and it is here that AI, if used responsibly, can be useful. There is always the danger that a miscalculation or false positive — when the technology incorrectly identifies a scenario as problematic or concerning when it isn’t  — could inadvertently lead to an escalation rather than prevention. But there are more advantages than risks.” In another column, Karishma says [the US may not have been the most honest of allies]( with the Philippines, though. She discussed the repercussions from a Reuters story that alleged  the US had used social media surrogates to denigrate a Chinese-made Covid vaccine that was the only serum available to the Philippines when the pandemic began to ravage the archipelago. That PR onslaught may have led many Filipinos to avoid vaccination; the death toll in the country was particularly high. While the government of President Ferdinand Marcos Jr. hasn’t weighed in, other politicians have fulminated against the Pentagon, which “apparently overrode objections from US diplomats in Southeast Asia who cautioned against such an operation during a health crisis.” It’s a point for China in the tug for Philippine hearts and minds — which have always had trepidations about their former American colonial overlords. But the revelation also deepens the split in the political alliance that helped Marcos win the presidency in 2022. His vice president is the daughter of his predecessor, Rodrigo Duterte, who’d been much more accommodating of China’s claims during his time in office. The dynasties haven’t been getting along lately. This week, Sara Duterte-Carpio quit the education portfolio in the Marcos cabinet without really saying why. She’ll remain veep, but the Marcos administration isn’t a particularly happy place nowadays. A Sty of a Trade War China loves pork. Spain loves pork, too. Spain is the biggest exporter of pig flesh to the People’s Republic — not just jamón but all parts of their famous Iberico hogs. However, responding to Brussels’ imposition of tariffs as high as 50% on Chinese electric vehicles, Beijing is looking into dumping charges on EU pork — and that’s aimed squarely at the hog farmers of Spain. Javier Blas calls agriculture “[Europe’s soft (pork) belly](” and says Beijing is hoping EU nations will soften the EV tariffs before they officially go into effect. Javier writes: “Germany was already unhappy with the duties, fearing for its own car sales in China; Spain and France, which appeared undecided, could join Berlin against Brussels.” China has turned local farmers against its trade antagonists before, says Javier. “It pressured Australia by targeting its farm exports, including barley, beef, wine and lobsters, and it tried to force the hand of the US by restricting the soybean trade. The farming lobby is particularly strong in Brussels. After all, autoworkers don’t take their cars to the center of Brussels as farmers do with their tractors when they need to protest government policy.”  But it’s not that simple. While Spain is a pork superpower, it is trying to become a contender in automaking. Says Javier: “Spain and China are competing in the very same segment in the car industry: small, cheap cars for the growing ranks of the world’s working and middle classes.” He adds: “Without tariff protection, it’s unlikely that Spain would be able to switch from gasoline into electric cars, and without that switch, its car industry would slowly die.” I love my pork. I’m glad I don’t drive. Telltale Charts: Special Nvidia Edition “Does anyone in Silicon Valley know the saying, ‘The bigger they are, the harder they fall?’ Perhaps it’s just a matter of time before they will. Tech company leaders should be wincing at the rapid ascension of Nvidia Corp. now that the artificial intelligence rally has propelled the chipmaker to become the world’s most valuable company. This is a firm that sells coveted AI chips to a handful of cloud giants who are reaping the short-term benefits of AI hype, even as things are looking murkier downstream. It’s hard to see how Nvidia Chief Executive Officer Jensen Huang will sustain such growth (even as he steers his company into selling software), and he can thank himself and his peers. Tech giants like Alphabet Inc., Amazon.com Inc. and Microsoft have warped expectations for generative AI’s contribution to profits. They will pay for that if they don’t temper expectations.” — Parmy Olson in “[Nvidia’s Explosive Growth Masks AI Disillusionment](.” Source: Bloomberg Meanwhile, an invidious comparison in election-mad France. — From Lionel Laurent in “[French Elites’ Silence on Le Pen Is Deafening](.” Source: Bloomberg Further Reading Yes, please pay a lot more for [Walmart managers](. — Andrea Felsted No, don’t be [feckless](over climate. — Lara Williams Lessons from a Japanese [unicorn](. — Catherine Thorbecke Stop betting on [billionaires](. — Chris Hughes The unfair [Chinese stigma](. — Shuli Ren The US will stay [No. 1 for a long while](. — Daniel Moss [Saudi oil consumption]( — not production — is key. — Javier Blas An unsettled France doesn’t mean another [euro crisis](. — Marcus Ashworth Who will be Japan’s [most powerful woman](. — Gearoid Reidy Walk of the Town: Skyscraper Fengshui HSBC headquarters right next to old Bank of China building, seen from Cheung Kong Square. Photograph by Howard Chua-Eoan/Bloomberg The Bloomberg offices in Hong Kong are in the Cheung Kong Centre, which is smack in the middle of two of the most distinctive skyscrapers in the former British colony. On one side is the headquarters of HSBC, the financial symbol of the former regime. On the other is the Bank of China tower, the emblem of the current rulers of the city. The first was designed by the legendary British architect Norman Foster and finished in 1985. The second came from the drawing board of Chinese-American architect I.M. Pei to replace an older building erected in 1950 — right next to HSBC. The new edifice was completed in 1990. With its slashing angles, the Bank of China building is reminiscent of Pei’s Louvre pyramid in Paris. However, they were considered bad fengshui. In a city obsessed with traditional Chinese geomancy, it felt like the Bank of China was directing bad energy against the HSBC HQ diagonally across from it. I hope the Cheung Kong Centre — which opened in 1999 — isn’t absorbing all the negativity! The facade of I.M. Pei’s Bank of China tower in Hong Kong Photograph provided by Bolton & Quinn. In any event, next week, Hong Kong will be celebrating the legacy of Pei, who died in 2019 at the age of 102. “I.M. Pei: Life Is Architecture” will be on at the M+ Museum on the Kowloon side. From there, looking across Victoria Harbor, you might catch a glimpse of the Bank of China throwing daggers at HSBC. Geomantic drama aside, this should be an all-encompassing retrospective of one of the greatest and most influential architects of our time. If you’re in Hong Kong, go. Drawdown Thanks for hanging around for a spell. Enchanté “I’m not gonna be popular, but when the hurlyburly’s done, you two can meet again. I’m clicking my heels for home.” Illustration by Howard Chua-Eoan/Bloomberg Notes: Please send jamón and wry feedback to Howard Chua-Eoan at hchuaeoan@bloomberg.net. [Sign up here]( and follow us on [Instagram](, [TikTok](, [Twitter]( and [Facebook](. Follow Us Like getting this newsletter? [Subscribe to Bloomberg.com]( for unlimited access to trusted, data-driven journalism and subscriber-only insights. Before it’s here, it’s on the Bloomberg Terminal. Find out more about how the Terminal delivers information and analysis that financial professionals can’t find anywhere else. [Learn more](. Want to sponsor this newsletter? [Get in touch here](. You received this message because you are subscribed to Bloomberg's Opinion Today newsletter. If a friend forwarded you this message, [sign up here]( to get it in your inbox. [Unsubscribe]( [Bloomberg.com]( [Contact Us]( Bloomberg L.P. 731 Lexington Avenue, New York, NY 10022 [Ads Powered By Liveintent]( [Ad Choices](