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Rubio meets Nato allies as Trump voices disappointment over Europe’s Iran war stance
Nato's European members will look to sound out US Secretary of State Marco Rubio on troop cuts by Washington on Friday, as they seek to smooth over President Donald Trump's ire ahead of a July summit. The meeting of alliance foreign ministers in the Swedish city of Helsingborg comes after the US leader lashed out at Europe over its response to his war on Iran - and threatened he could consider quitting Nato. The 77-year-old alliance was rattled this month when Washington abruptly announced it was withdrawing 5,000 troops from Germany after a spat between Trump and Chancellor Friedrich Merz. While the Trump administration had long warned it would pull out forces from Europe to focus on other threats, a lack of coordination has heightened concern over Washington's reliability in the face of a menacing Russia. France 24, May 22

Countries need clarity on war before tapping oil reserves, France says
Governments cannot decide whether to release more oil reserves to calm the crisis caused by the Iran war until they know how long the conflict is likely to last, said France’s finance minister. Asked whether talks over a second release of strategic oil reserves had begun, Roland Lescure told the FT that the issue was not on the table when he hosted finance ministers from G7 nations, including US Treasury secretary Scott Bessent, in Paris earlier this week. “We cannot release stocks - which are by nature finite - without having visibility on the duration and intensity of the conflict at this stage,” Lescure said in an interview. Even once the Strait of Hormuz does open, it will take several weeks for oil supplies to reach Europe, Asia and other regions, so visibility on the timing of when those flows will restart will be key, he added. “That would be the kind of moment in which it would make sense to consider the release of reserves to ensure the transition [from] the current phase to the next. The circumstances have not yet come together,” Lescure said. Financial Times, May 22

US navy chief says $14bn arms sale to Taiwan paused due to Iran war
The US is pausing a $14bn (£10.4bn) arms sale to Taiwan to ensure it has enough weapons for the Iran war, acting Navy secretary Hung Cao has said. Cao confirmed this at a Senate hearing, days after President Donald Trump appeared non-committal about the sale following his meetings with Chinese leader Xi Jinping. A spokesperson for Taiwan's presidential office told reporters on Friday that they had not received any information about "US adjustments to the arms sale". The sale of US arms to Taiwan has long irked Beijing, which claims the self-governed island as its territory and has not ruled out taking it by force. "Right now we're doing a pause in order to make sure we have the munitions we need for Epic Fury - which we have plenty," Cao said at the hearing on Thursday, using the code name for the US-Israel joint military operation in Iran. "We're just making sure we have everything, but then the foreign military sales will continue when the administration deems necessary." When asked what he had heard from the Taiwanese about a pause in the weapons sale, Cao said he had "not spoken to the Taiwanese". BBC news, May 22

UK borrowing hits £24.3bn in April as debt service costs jump
The UK’s public sector borrowing bill rose more than expected last month as the government paid more to service its debts. Official figures from the Office for National Statistics showed the borrowing bill was up to £24.3 billion in April, above the £20.9 billion forecast by the Office for Budget Responsibility, the government’s fiscal watchdog. The figure represents the level of state borrowing needed to cover the difference between spending and tax revenues. The ONS said the debt interest bill rose to £10.3 billion last month – the highest on record for April which marks the start of the new financial year. The government is paying more than £100 billion a year to service its debts as a result of high interest rates and market borrowing costs. The Times, May 22

UK officials discuss fresh aid cuts to help fund higher defence spending
UK officials are discussing fresh cuts to the falling aid budget to help finance defence investment, sparking anxiety among MPs and charities about the government’s commitment to international development funding. The proposals to further reduce the aid budget, under discussion in Whitehall according to people familiar with the matter, come after Sir Keir Starmer last year said he would slash development spending to fund a defence spending uplift in order to counter the threat from Russia. The prime minister said the aid budget would fall from 0.5 per cent of gross national income to 0.3 per cent by 2027 in order to fund a commensurate rise in defence spending, following pressure from Donald Trump on European allies. Starmer has since vowed to “go further and faster” in raising military funding and has promised to set out details within weeks. MPs and charities have warned the prime minister not to cut the aid budget to fund it. Financial Times, May 22

Germany's Merz proposes Ukraine as EU ‘associate member’ without voting rights
German Chancellor Friedrich Merz has proposed making Ukraine an "associate member" of the EU without voting rights, while Kyiv goes through the lengthy process of joining fully, a letter seen by AFP on Thursday said. The plan - first floated by Merz with EU counterparts last month - would see Ukraine's leader attend the bloc's summit but not be able to cast a vote. Kyiv would have a representative at the top table of the EU's executive, the European Commission, and non-voting members of the European parliament. Under the proposal, outlined by Merz in a letter to EU chiefs Ursula von der Leyen and Antonio Costa, the bloc's mutual assistance clause would apply to Ukraine, and it could benefit from parts of the EU's budget. "It is obvious that we will not be able to complete the accession process shortly, given the countless hurdles as well as the political complexities of ratification processes," Merz wrote. France 24, May 21

Justice Department charges former Cuban president in fatal downing of planes
The Justice Department announced charges on Wednesday against Raúl Castro, the 94-year-old former president of Cuba, accusing him of murder and a conspiracy to kill American citizens stemming from the fatal downing 30 years ago of two planes over waters off the coast of his country. The indictment, issued in Federal District Court in Miami, was an extraordinary escalation of the Trump administration’s multifaceted pressure campaign against Cuba’s Communist government at a moment when President Trump has been seeking to topple it. The charges brought to bear on Mr Castro, the brother of Fidel Castro, the vast powers of the US criminal justice system, saddling him with a possible maximum penalty of life in prison. They also raised the possibility that the United States could be paving the way for its military to remove him from the country through a means similar to how US Special Operations forces used an indictment against Nicolás Maduro, the former leader of Venezuela, to swoop into Caracas in a brazen operation in January and capture him. The indictment, which also accused five fighter pilots involved in the attack on the planes, was secretly returned last month by a federal grand jury and built on earlier charges, first filed in 2003, against one of them. New York Times, May 20

Elon Musk’s SpaceX sets out plans for biggest IPO in history
SpaceX has revealed plans for the largest initial public offering in history as the Elon Musk company that spans rockets, satellites and artificial intelligence kicks off a series of market debuts that could reshape Wall Street. The company filed its highly anticipated prospectus with US securities regulators on Wednesday evening, giving investors their first glimpse at its financials, Musk’s sway over the group and sweeping risk factors. SpaceX said that it would list on the Nasdaq under the ticker SPCX in an offering underwritten by Wall Street’s biggest banks. Goldman Sachs secured the coveted “lead-left” position heading the offering in a blow to its uptown rival Morgan Stanley. While the size of the offering and the proposed valuation were not disclosed, the FT has previously reported that the rocket maker has discussed raising about $75bn at a $1.75tn valuation. SpaceX’s filing fires the starting gun on what US bankers hope will be a blockbuster year, with OpenAI expected to file its IPO paperwork as soon as this week and Anthropic also planning to float its shares. Financial Times, May 21

UK agrees £3.7bn trade deal with six Gulf states
The UK has struck a trade deal with a group of six Gulf states which it says will be worth £3.7bn to the economy. The government said the deal with Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and United Arab Emirates would remove an estimated £580m a year in tariffs from British exports to the region once fully implemented. It also said it would make it easier for British firms to expand and partner in the Gulf, which will support jobs. Activist groups have criticised the lack of detail on human rights and labour protections in the deal. But the deal was welcomed by Chris Southworth, secretary general of the International Chamber of Commerce UK, as a "boost to business confidence". The Conservatives, who began the negotiations for the deal when in government, said it was "another major Brexit opportunity" which Labour risked "throwing away" because of what it saw as Labour's pro-EU stance. British products that will have tariffs removed include cheddar cheese, butter and chocolate. The trade deal between the UK and the Gulf Co-operation Council is the third struck by Prime Minister Sir Keir Starmer's government, after those with India and South Korea. It is also the first deal between a G7 country and the GCC. BBC news, May 20

Social care providers may face caps on ‘excessive’ profits
Private providers of social care may face caps on their profits following concerns that “profiteering” is driving councils into bankruptcy. Steve Reed, the local government secretary, will promise to bear down on “excessive or unjustified profits” and ask for examples of “unreasonable cost escalation or particularly egregious ­behaviour”. Reed will write to councils on Thursday to say that costs “continue to rise, particularly in services for vulnerable people, squeezing neighbourhood and preventative services”. A law passed last month includes powers to cap profits on providers of children’s care and foster homes, but it has not yet taken effect. Reed will say he “will not flinch from capping the profits of private providers placing vulnerable children in care”. The Times, May 21

UK business activity fell for first time in more than a year in May
UK business activity fell for the first time in more than a year in May, according to a closely watched survey, as domestic political uncertainty adds to the fallout from the Middle East war. The S&P Global Flash UK PMI composite output index, a measure of activity in the private manufacturing and services sector, fell to a 13-month low of 48.5 in May, down from 52.6 in April. The reading was lower than the 51.6 forecast by economists polled by Reuters and below the threshold of 50 that indicates a majority of businesses reporting expanding activity. Chris Williamson, chief business economist at S&P Global Market Intelligence, said: “The UK economy is facing a perfect storm, as rising political uncertainty adds to the growing impact from the war in the Middle East.” He added: “Businesses are reporting falling output, surging inflation, supply shortages and job cuts in May.” Companies in the services sector signalled the sharpest decline in business activity since January 2021. Financial Times, May 21

Saudis willing to sell 25% of their Newcastle FC stake
Saudi Arabia’s Public Investment Fund is prepared to dilute its stake in Newcastle United by selling up to 25 per cent of its shareholding in the club. The PIF, which recently pulled the plug on its funding for LIV Golf, intends to remain the majority shareholder. However, the move is seen as key in an attempt to get equity into the Premier League club before the announcement this summer of a proposed £200million training ground at Woolsington, a village near Newcastle, and further talks on a possible new stadium that could cost more than £1billion. The club’s value, according to sources, is thought to have increased to about £1.5billion. A sale of a quarter of the PIF’s stake would give the buyer a shareholding of 21.25 per cent of Newcastle and could bring in more than £300million, a sum that would be put towards the two substantial projects. The PIF owns 85 per cent of Newcastle at present, a stake it purchased from the former owner Mike Ashley in a £305million takeover in September 2021. The Reuben brothers, through RB Sports & Media, own the other 15 per cent. It is thought that the PIF is prepared to dilute its present holding in the club to about 63.75 per cent after being told at a club meeting last month that equity was needed to progress the plans for a new ground and training facility. The Times, May 21