FirstFT: South Korea’s Yoon Suk Yeol faces calls to resign after failed martial regulation order

At the moment’s agenda: French no-confidence vote; Bundesbank chief requires spending reform; China-Saudi ties heat; visible investigation on Russia’s killer drones; and Martin Wolf on the worth of US prosperity

Good morning. We flip to the political disaster in South Korea, the place President Yoon Suk Yeol is dealing with stress to resign after abandoning an try to impose martial regulation and purge the nation of “anti-state forces”. Right here’s what we all know thus far.

How did the disaster unfold? Yoon’s martial regulation order adopted simmering tensions with the parliament’s opposition majority, which he claimed was plotting riot and harbouring North Korean sympathies. Lawmakers final week voted to chop nearly $3bn from his proposed 2025 finances, slashing funding for his workplace, senior prosecutors and the police. Yoon mentioned the cuts compelled his hand as they might flip South Korea right into a “drug paradise” crammed with “public order panic”. Opposition leaders have accused him of authoritarian tendencies and mentioned they’ve been persecuted by prosecutors allied with Yoon.

However analysts mentioned the order would have been troublesome to implement, along with his low public assist and lack of backing in his personal celebration. “He sounded like a politician under siege, making a desperate move,” mentioned Leif-Eric Easley, a professor in Seoul. Yoon lifted the order after it was rejected unanimously by lawmakers.

What has the fallout been? Opponents have known as on Yoon to resign or face impeachment, and his personal celebration is discussing whether or not he ought to depart. Senior aides have provided to stop en masse, whereas the nation’s main umbrella labour group has launched an indefinite strike till he steps down.

The disaster has alarmed worldwide allies. Deliberate defence talks and joint army workouts with the US this week have been postponed, whereas Swedish Prime Minister Ulf Kristersson delayed his scheduled go to to Seoul.

In markets, South Korea’s Kospi inventory index fell as a lot as 2 per cent this morning. The gained declined to a two-year low yesterday earlier than strengthening towards the greenback after officers put aside $35.4bn in stabilisation funds and pledged “unlimited” liquidity.

As protests proceed in Seoul, our reporters will deliver you the most recent right here.

Right here’s what else we’re maintaining tabs on at the moment:

• Financial knowledge: The OECD has its world financial outlook, whereas the Federal Reserve publishes its Beige Ebook on financial situations throughout the US.

• French politics: Michel Barnier’s three-month-old administration is prone to collapse when far-right and leftwing opposition events maintain a no-confidence vote at the moment. Learn the FT View on the potential chaos to come back.

• Central banks: European Central Financial institution chief Christine Lagarde addresses a European parliament committee listening to in Brussels. Chris Giles interviews Financial institution of England governor Andrew Bailey on the FT’s World Boardroom occasion at 9am GMT. Register to observe on-line.

For extra on financial coverage from Chris Giles, enroll right here for his Central Banks publication if you happen to’re a premium subscriber, or improve your subscription right here.

5 extra prime tales

1. Unique: The top of Germany’s Bundesbank has known as on Berlin to melt its powerful spending guidelines, warning that Europe’s largest economic system faces a “complicated” and “weak” outlook. The central banker known as for modifications to the so-called debt brake, which bans the federal government from borrowing greater than 0.35 per cent of GDP in any fiscal 12 months. Learn the FT’s full interview with Joachim Nagel.

2. Unique: Chinese language exports and funding are pouring into Saudi Arabia as the dominion’s demand for inexperienced tech deepens a relationship as soon as outlined by oil gross sales. The warming relations problem enterprise ties with Riyadh’s conventional western companions such because the US and complicate the outlook for Donald Trump’s administration.

• US-China: Beijing has banned shipments to the US of a number of minerals and metals utilized in chipmaking and army functions, in retaliation for brand new export controls from Washington.

3. Syrian rebels have reached the outskirts of Hama, one of many nation’s largest cities, dealing one other blow to Bashar al-Assad’s regime. If the rebels seize management of Hama, will probably be the primary time the regime has misplaced management of town because the civil conflict erupted after a 2011 widespread rebellion towards Assad. We now have the most recent right here.

4. Cryptocurrencies representing a euthanised gray squirrel, a Thai pygmy hippopotamus and a cartoon canine have exploded in worth since final month’s US election, with Dogecoin outperforming bitcoin over the previous month. Right here’s how Trump’s win has triggered a “memecoin” increase.

5. Buyers have gone too far of their bets on the near-term potential of synthetic intelligence, Vanguard has warned. Regardless of optimism that AI would show as revolutionary because the adoption of the private pc within the Eighties, right here’s why the $1tn asset supervisor says there’s threat of a “correction” in inventory costs.

Visible investigation

Civilians in Ukraine’s Kherson have been, since midsummer, the goal of an experiment with out precedent in fashionable European warfare: a concerted Russian marketing campaign to empty a metropolis by stalking its residents with assault drones. The FT investigates how Moscow’s machines have killed dozens and injured a whole lot over greater than 9,500 assaults.

We’re additionally studying . . . 

• A egocentric parting act: Joe Biden has robbed Democrats of the possibility to occupy the upper floor by turning into the primary US president to pardon an offspring, writes Edward Luce.

• Japan’s chip ambitions: The federal government is backing a start-up that goals to upend the economics and geography of the semiconductor business. Can it succeed?

• Meritocracy in aristocracy: In his first column for FT Wealth, Earl Charles Spencer writes a few historic home in England and the way dynastic household inheritance has developed.

Chart of the day

The sustained prosperity of the US is astounding, writes Martin Wolf. Few western international locations have greater actual incomes per head. However what does US exceptionalism imply when mixed with potent indicators of low welfare?

Take a break from the information

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