FirstFT: Ukraine finalising insurance deal for Black Sea grain ships

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We begin today with a scoop on Ukraine’s plans to create a safe corridor for its vessels travelling through the Black Sea, as it nears a deal with global insurers to cover the grain ships under threat from Russia.

Oleksandr Gryban, Ukraine’s deputy economy minister, told the Financial Times that the deal was “currently being pursued and actively discussed” between the relevant ministries, as well as local banks and international insurance groups including Lloyd’s of London.

The scheme could be put in place as early as next month, with as many as five to 30 ships covered to travel through what he described as the “danger spot” of Ukrainian waters.

Russia withdrew from a UN-brokered grain deal last month and had warned it would consider any civilian vessel leaving Ukraine’s ports as military targets.

But under the cover of Ukrainian onshore defence systems, a German/Chinese-owned cargo ship managed to make the first commercial journey out of Odesa since Moscow’s threat. Here’s why the new deal is crucial to reviving shipping activity.

Here’s what else I’m keeping tabs on today:

• US: President Joe Biden and First Lady Jill Biden visit Maui, the Hawaiian island stricken by deadly wildfires.

• Results: Zoom reports second-quarter results after calling for staff to return to the office this month. Demand for the video conferencing platform’s services has dropped as more companies adopt hybrid work. Self Storage Group also has earnings.

Five more top stories

1. Exclusive: Citigroup’s chief is considering a plan to disband the bank’s biggest division in what would be the most significant structural shake-up in nearly 15 years. The plan would affect the Institutional Clients Group, which generated nearly three-quarters of the bank’s net profits last year. Here’s why Jane Fraser wants to split it into three units.

2. Saudi border guards have killed hundreds of Ethiopian migrants attempting to cross into the kingdom from Yemen over the past 18 months, a rights group has said, alleging security forces “fired explosive weapons” and in some cases asked migrants which of their limbs they would prefer to be shot. Here are more details from the 73-page report by Human Rights Watch.

3. Russia has filed a lawsuit against billionaire oligarch Andrey Melnichenko as Moscow seeks to seize and nationalise one of the companies in his metals and mining empire, claiming its purchase five years ago involved “corrupt collusion” with Mikhail Abyzov, a government minister accused of fraud. Melnichenko, now based mainly in the UAE, has described the war against Ukraine as “tragic”.

4. China has cut a benchmark lending rate by less than expected and left another unchanged, defying analysts’ forecasts. The People’s Bank of China reduced the one-year loan prime rate, a reference for bank lending, by 10 basis points and kept its five-year equivalent — linked more to mortgage lending — at 4.2 per cent. Here’s why the moves have surprised economists.

5. The $25tn global private funds industry is bracing for one of the most sweeping regulatory reforms in its history as the US Securities and Exchange Commission prepares to impose tough requirements on private equity, real estate and hedge funds when it meets on Wednesday. Here’s more on the far-reaching rules.

The Big Read

Welcome to the à la carte world. As the post-cold war age of America as a sole superpower fades, the old era when countries had to choose from a prix fixe menu of alliances is shifting into a more fluid order. The stand-off between Washington and Beijing is presenting an opportunity for much of the world: not just to be wooed but also to play one off against the other — and many are doing this with alacrity and increasing skill.

We’re also reading . . . 

• Public health: Countries need to start working together on the most dangerous pathogens to avoid repeating the mistakes of Covid-19, the World Health Organization’s chief scientist said in an interview with the FT.

• Credit Suisse: What started as Switzerland’s public embarrassment is now a source of increasing political pressure, writes Jonathan Guthrie, as voters watch UBS closely ahead of October elections.

• Strength in solidarity: As autocrats around the world intensify ties, human rights activists are calling for greater global co-operation, writes author and journalist Kim Ghattas.

Graphic of the day

Car manufacturers, mining companies and battery developers are all trying to carve out a space in the world of next-generation batteries, forming a series of alliances while placing technological bets. But whatever technology becomes dominant, batteries powering tomorrow’s electric vehicles will require vast amounts of mining and processing.

Take a break from the news

It’s been a big summer for cinema. This FT Magazine special looks at the global cinema industry through the lenses of nine photographers, in a celebration of the art, craft and big personalities of film-making.

Additional contributions from Benjamin Wilhelm.