US relaxes tech restrictions to boost Aukus security pact

Good morning. Today we’re covering:

• Why SoftBank’s AI talks with Intel collapsed

• The global fashion brands cutting Bangladesh orders

• The European fishing boats exploiting foreign waters

But first, the US is easing its restrictions on sharing sensitive technology with the UK and Australia, in order to strengthen their trilateral Aukus security pact aimed at countering China in the Indo-Pacific.

The US Department of State is amending its International Traffic in Arms Regulation rules to make it easier to share military-related technology with the allies.

The state department said the reform would mean the UK and Australia did not need to apply for licences to obtain American technology for roughly 80 per cent of their defence-related trade with the US.

One UK official described the reforms as a “big deal” because it was “about the UK, Australia and US being as competitive as they can with China”.

Read the full story from our US-China correspondent Demetri Sevastopulo.

Here’s what I’m keeping tabs on today and over the weekend:

• Economic data: Hong Kong, Taiwan and Malaysia publish second-quarter growth figures. Hong Kong also reports July jobs data, while South Korea releases revised trade data for July.

• Thailand: Parliament holds a vote on the successor to former prime minister Srettha Thavisin, who was dismissed by the constitutional court this week.

• Indonesia: The country on Saturday holds its first independence day celebration in Nusantara, the new capital being carved out of the jungle. But the event has been scaled back amid setbacks to the $30bn project.

• Singapore: Prime Minister Lawrence Wong on Sunday delivers the annual National Day Rally speech.

• Vietnam-China ties: Vietnamese leader To Lam begins a visit to China on Sunday. It is his first foreign trip since becoming general secretary of Vietnam’s ruling Communist party earlier this month following the death of longtime ruler Nguyen Phu Trong. (Reuters)

How well did you keep up with the news this week? Take our quiz.

Five more top stories

1. Exclusive: SoftBank held talks with Intel about producing an artificial intelligence chip to compete with Nvidia but the plan foundered after the US chipmaker struggled to meet the Japanese group’s requirements. SoftBank is now focusing on discussions with Taiwan Semiconductor Manufacturing Co, people familiar with the matter said.

2. Prime Minister Narendra Modi has condemned violence against women and vowed to mete out “tough punishment” to perpetrators of sexual crimes after the rape and killing of a junior medic sparked protests across the country. In his Independence Day remarks, Modi also urged neighbouring Bangladesh to ensure the safety of minority Hindus after protesters overthrew the government of his ally Sheikh Hasina last week.

3. China’s industrial production grew at the slowest rate in four months in July. The new data adds to signs of a weak start to the third quarter as a deep property slowdown weighed on the world’s second-largest economy.

4. Spy chiefs from the US and Israel yesterday began talks in the Qatari capital, Doha, aimed at securing the release of Israeli hostages and ending the Gaza war. The discussions have been given fresh urgency by the looming threat that Iran and its regional proxy forces will retaliate against Israel for the back-to-back assassinations last month of two militant leaders.

5. Wall Street rallied as strong retail sales data and robust results from Walmart increased confidence that the US economy will avoid a recession and achieve a “soft landing”. The S&P 500 closed 1.6 per cent higher — enough to wipe out all the benchmark index’s losses for August.

News in-depth

Global fashion brands are shifting orders away from Bangladesh because of the turmoil that surrounded the fall of authoritarian Prime Minister Sheikh Hasina, according to manufacturers in the world’s second-largest garment exporter. Factories were shut for days after Sheikh Hasina’s government brutally cracked down on student protesters, while multiple factories owned by regime loyalists were torched in retaliatory attacks.

We’re also reading . . . 

• Visual investigation: European fishing vessels are taking up African flags, enabling them to exploit local fishing laws.

• Kishida’s successor: Japan’s next leader needs to project hope and confidence in the face of the country’s challenges, the FT editorial board writes.

• Weight-loss pills: Years before Wegovy, Swiss drugmaker Roche turned down a potential $14bn-a-year “mega-blockbuster” obesity treatment now being developed by rival Eli Lilly.

Chart of the day

Elon Musk’s following on X has nearly doubled since his purchase of the social media platform less than two years ago, handing the billionaire a public megaphone to amplify his increasingly incendiary views.

Take a break from the news

Ever wish your loud, turbulent toilet flushed just a tad quieter? Or had features such as remote-control lids and inbuilt bidets? Helen Barrett peers inside the fiercely competitive, high-tech, high-ticket world of beyond-bog-standard loos.

Additional contributions from Harvey Nriapia and Tee Zhuo