Twitter’s ‘collision path’ with the EU

This is an audio transcription of the FT press briefing podcast episode: ‘Twitter’s ‘collision path’ with the EU‘

Sonja Hutson
Hello from the Financial Times. Today is Wednesday, November 16, and it’s your FT News Briefing.

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The Japanese yen rebounds. New European tech regulations could cause problems for Twitter. And we get the latest from Ukraine after Russia launched its biggest airstrikes since the invasion began. I’m Sonja Hutson, for Marc Filippino, and here’s the news you need to start your day.

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Japan’s currency is making a comeback on hopes that the US Federal Reserve will slow the pace of its interest rate hikes. Over the past three weeks, the yen has risen from a 32-year low. Its sharp drop this year has raised concern as Japan’s economy has actually contracted due to rising bills for imported food and raw materials. The government announced a spending plan to mitigate the impact on households and it also intervened in the foreign exchange markets to support the yen. But currency analysts and economists say the fate of the yen is dictated by the Fed and the dollar.

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Europe’s landmark technology regulation law comes into force today. The Digital Services Act gives Brussels new power to regulate Big Tech companies, which could spell trouble for Twitter. The social media site has just rolled out an identity verification system. It’s part of a redesign by its new owner, Elon Musk. But the verification system has struggled with copycats. Our European correspondent Javier Espinoza says this could make Twitter a target for newly empowered European regulators.

Javier Espinoza
This is a potential violation of posting illegal content or harmful content online. Of course, there will be ways in which, you know, you report something to the platform and then they can check whether it’s legal or not. But the idea, just to get back to the basics of what’s changing today, is that Brussels is getting new powers to go on Twitter and ask them, how do you work? How transparent are you in how you let users online?

Sonja Hutson
So, Javier, what do you think Brussels could do if Elon Musk doesn’t change course with Twitter?

JAvier Espinoza
If Elon Musk continues on this path, he is really headed for a collision with Brussels. What does it mean? So, from today, Brussels has the power to ask Twitter to change its behavior, and if it doesn’t, it can impose periodic fines, which means that every week it could impose on the platform a fine of several million dollars, up to 6% of its worldwide turnover. . And if Elon Musk continues and persists and the platform does not change course, Brussels even has the power to completely ban the platform from Europe.

Sonja Hutson
Javier Espinoza is the FT’s European correspondent.

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Ukraine’s president yesterday outlined a peace settlement and Russia responded with a storm of missile strikes. Moscow’s attack was the biggest since it launched its invasion of Ukraine nearly eight months ago. The targets included power plants, power lines and other infrastructure. The FT’s Felicia Schwartz is in Kyiv and joins me now to talk more about what’s going on. Hello, Felicia.

Felicia Schwartz
Hi how are you?

Sonja Hutson
So, Felicia, these strikes are also taking place after Ukrainian forces have made great strides in the war. They took over the city of Kherson. It is the only provincial capital that Russian forces have been able to capture. How important is it?

Felicia Schwartz
It’s definitely a strategic and symbolic move. Ukraine recapturing Kherson means it can target Russian supply lines on the way to Crimea. They are denying Russia what was a sort of strategic point of view on the Dnipro. But that being said, there is very, very tough fighting elsewhere in the east and near Donetsk, which President Zelensky described as hell. So, while this is a pretty significant moment, it’s by no means the end of the war.

Sonja Hutson
Thus, Ukrainian President Volodymyr Zelenskyy said that at least 85 missiles were fired at Ukraine. Some of them hit Kyiv, where you are. How was it on the pitch during the strikes?

Felicia Schwartz
I was about to meet a contact when the air raid sirens went off and I kind of had to decide whether to continue or not. And I went ahead and met the person, but changed the location of the meeting to a cafe in a basement so that we were a little more protected. And the unprotected coffee and the more protected coffee both worked. There were a lot of people inside both. Life kind of went on, but definitely on a muted tone. People seemed nervous. We could hear a nearby table watching videos on Telegram of early reports of the upcoming strikes. So today and in general, businesses have been quite resilient and are finding ways to keep going.

Sonja Hutson
Yeah. And you reported on how Ukrainian companies are coping, especially with these attacks on power supplies. What else have you seen Ukrainian companies do to survive?

Felicia Schwartz
Thus, restaurants or stores will continue to operate with the lights off. They will light candles. One cafe I visited for the story, they spun an extension cord from their front door to a neighbour’s, a nearby building that still had electricity so they could, you know, run their machine coffee. There are factories that have priority for electricity in the evening rather than during the day. So they changed their production lines to work at night. So people get creative. But we also know that these blackouts are having a significant impact on Ukrainian businesses and threatening further reductions in projected GDP, which is already impacted enough by the war.

Sonja Hutson
Does Ukraine have a means of defending itself against an attack of this magnitude?

Felicia Schwartz
Air defense has been a pretty critical part of the Western effort to provide lethal assistance, but there probably won’t be enough air defense to protect everything. Ukrainians therefore have to make some tough choices and I think this is a real push by the United States and its other allies to try to move as much as they can in Ukraine in the weeks and months ahead.

Sonja Hutson
Felicia Schwartz is the FT’s foreign affairs and defense correspondent in the United States. Thanks, Felicia.

Felicia Schwartz
Thank you for.

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Sonja Hutson
Before we go, we have a word for our crossword fans. The FT has a new number crossword app. It lets you solve clues online every day on your phone or tablet. On Saturdays, you can tackle a plethora of crossword puzzles, cryptic general knowledge, and a weekend. And if that’s not enough, you’ll also find a 30-day archive of puzzles to keep you busy.

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You can read more about all these stories on FT.com. This has been your daily press briefing on FT. Be sure to check back tomorrow for the latest trade news.