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Good morning. Several large Taiwanese manufacturers are considering setting up a second headquarters overseas to ensure they can keep operating in the event of a Chinese attack on their country.
The plans, which remain preliminary in most cases, highlight how global efforts to secure supply chains are forcing companies that play a vital role in manufacturing networks, especially for tech products, to make extensive changes.
Rauniei Kuo, a partner and head of the family office business at KPMG in Taiwan, said his clients looking to set up overseas headquarters are in manufacturing and are considering other locations in south-east Asia.
“[J]ust in case an emergency happens in Taiwan, to give them an alternative command system abroad that they can immediately activate”, Kuo said.
The country head of one global consultancy in Taiwan said while many companies were still mostly focused on geographically diversifying production, “discussions about back-up headquarters have started at the top in the largest groups”.
The FT’s Kathrin Hille has more on the heightened contingency planning in Taiwan.
And here’s what else I’m keeping tabs on today:
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US-Japan relations: President Joe Biden hosts Prime Minister Fumio Kishida for a state visit. The two countries plan to upgrade their security alliance to respond to what they view as a growing threat from China.
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South Korea parliamentary elections: Polls forecast that the country’s leftwing parties will retain their majority in the National Assembly, an outcome analysts said could threaten conservative President Yoon Suk Yeol’s economic reform efforts.
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BBC’s India operations: The British broadcaster will split off its India news operations after coming under regulatory scrutiny from Indian authorities after it aired a controversial documentary about Prime Minister Narendra Modi.
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Economic data: The US publishes inflation data for March. Economists polled by Reuters expect the consumer price index to rise to 3.4 per cent.
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Holiday: Financial markets are closed in Singapore, Malaysia, Indonesia and several other Asian countries for Eid al-Fitr, which marks the end of Ramadan.
Five more top stories
1. Exclusive: OpenAI and Meta are on the brink of releasing new artificial intelligence models that they say will be capable of reasoning and planning, key steps towards achieving human-level cognition in machines. Meta’s vice-president of AI research Joelle Pineau said the company was working “to get these models not just to talk, but actually to reason, to plan . . . to have memory.” Read the full story.
2. China and Russia have pledged to maintain “industrial supply chain stability” just days after US Treasury secretary Janet Yellen warned Beijing against supporting Moscow’s war effort. Russian foreign minister Sergei Lavrov’s visit to Beijing — which included meetings with his Chinese counterpart Wang Yi and President Xi Jinping — offered the latest signs of the growing partnership between China and Russia.
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More China news: Chinese anti-corruption authorities are investigating a senior executive at one of the country’s top military equipment suppliers in a new sign of turmoil in the country’s defence establishment.
3. Exclusive: TikTok workers in the US have been saddled with millions of dollars in tax liabilities on shares they are unable to sell, at a time when the Chinese-owned video-sharing app is battling a potential US ban. ByteDance, the app’s Beijing-based parent, is facing a backlash from US employees over its stock awards programme, according to interviews with more than a dozen current and former staff.
4. Imported vehicles are piling up at European ports amid a slowdown in sales and logistical bottlenecks including the lack of truck drivers. Port and car industry executives have pointed to a pile-up of Chinese electric cars as one of the leading causes of the problem. “Chinese EV makers are using ports like car parks,” said one car supply chain manager.
5. Myanmar’s rebel forces claimed to have seized a military base near a key town at the Thailand border, in the latest blow to the ruling military regime that has been losing ground to opposition groups for months. Some neighbouring countries have called for a rethink on how to deal with the regime, which came to power in a 2021 coup, given its weakened position.
Visual story
Trucks filled with tonnes of aid are stuck on Gaza’s border as the Palestinian enclave nears famine. Obstructions are legion: bombardment from Israeli forces, insecurity within Gaza, a lack of security staff, unpredictable Israeli checks, just a handful of overloaded entry points, shortages of delivery vehicles, corruption and the countless miseries of war. The FT’s latest visual story traces the daily struggle to feed Gaza.
We’re also reading . . .
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Japan’s super train: There has been scoffing about the need for a 500km/h train in a country that is, by pressure of demographics, shrinking and slowing down, writes Leo Lewis.
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Diversity: Stephen Bush explores what a recent photo of the Arsenal Women’s football team can teach us about representation and success.
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WeightWatchers: Recasting the company for the era of weight-loss jabs is akin to Facebook overhauling its social media site for mobile, or Netflix moving from DVDs to streaming, CEO Sima Sistani argued.
Chart of the day
Nissan and Honda, Japan’s second- and third-largest carmakers (behind Toyota), are planning to combine forces to develop electric cars in a bid to survive the coming wave of high-tech, low-cost models from China. Kana Inagaki’s latest column examines the unlikely partnership between the rival Japanese carmakers.
Take a break from the news
V-necks have been verboten for as long as most of us can remember, writes Teo van den Broeke. But with menswear runways full of them, celebrities wearing them on the red carpet and stores placing them at the heart of their new offerings, is the style back?
Additional contributions from Tee Zhuo and Gordon Smith
