A political week to remember

Balance of Power From FOLLOW US SUBSCRIBE   To say it's a big week in U.S. politics would be an understatement. After months of campaigning that have only somewhat whittled a historically large field of Democratic presidential contenders, tonight's Iowa caucuses kick off the formal part of the nominating process. A late surge from Bernie Sanders has some party strategists worried about the prospect of a self-proclaimed socialist leading the ticket in November and has prompted advisers to former Vice President Joe Biden — once the clear Democratic front-runner — to temper expectations for his early-round performances. But the outcome in Iowa is famously hard to predict and, as Gregory Korte explains, could come down to spur-of-the-moment decisions by thousands of voters. With the Democrats likely remaining splintered for the foreseeable future, President Donald Trump has an opportunity with his annual State of the Union address tomorrow to refocus attention on his economic record and what he views as his first-term accomplishments. The speech carries added intrigue this year. When the president steps behind the rostrum to address a joint session of Congress, he will be in the same chamber that voted seven weeks ago to impeach him. It will come on the eve of an almost certain Senate acquittal on charges he abused the power of his office and obstructed the legislature. This may be just the formal start of the 2020 race, but the events of the next several days will undoubtedly be remembered when the history of this campaign season is written. — Kathleen Hunter Sanders during a visit yesterday to a field office in Cedar Rapids. Click here for more on what's at stake today for Elizabeth Warren, who Sanders has usurped in Iowa as the darling of the progressive left, and here for a primer on how the caucuses work. Photographer: Al Drago/Bloomberg Global Headlines Containment efforts | Hong Kong will close more border checkpoints with China to ward off the spread of the deadly coronavirus that has killed more than 360 on the mainland. It comes as Beijing says the U.S. "inappropriately overreacted" to the virus and hasn't done much to counter the outbreak, disputing the Trump administration's claim it offered aid. China markets sank — almost 3,500 stocks by their daily limit — after the elongated Lunar New Year break. The virus lockdown has hit Chinese oil demand. The virus is perhaps the biggest challenge yet for President Xi Jinping. Here's why. Click here for a look at the risks mounting for Hong Kong's economy. A health worker in a protective suit checks departing travelers' temperatures at Hongqiao Railway Station in Shanghai yesterday. Photographer: Qilai Shen/Bloomberg Brexit quarrels | Prime Minister Boris Johnson has threatened to walk away from talks over a post-Brexit trade deal with the European Union rather than accept demands the U.K. signs up to the bloc's single market regulations and the rulings of its court. EU chief Brexit negotiator Michel Barnier today said a "highly ambitious" trade deal is on offer only if Johnson signs up to strict rules to prevent unfair competition. The dueling positions mark the start of 11 months of bargaining that risks ending in economically damaging failure. Deadly clash | Four Turkish soldiers died and nine were wounded in Syria after government forces attacked their positions. Turkey responded with F-16 airstrikes and artillery fire, killing as many as 35 Syrian troops. President Recep Tayyip Erdogan said Damascus will soon realize how big a mistake the assault was and urged Syria's main backer, Moscow, not to try to stop the Turkish operation, saying its only target is Bashar al-Assad's regime. Huawei resistance | Chancellor Angela Merkel's efforts to rule out a ban on any role for Chinese tech giant Huawei in Germany's next-generation wireless networks face resistance in parliament. She's failed to forge a compromise with hard-line lawmakers in her Christian Democratic-led bloc in a standoff that pits trade interests with China against security concerns raised by Washington and her own intelligence agencies. Wake-up call | South African President Cyril Ramaphosa is getting an earful about the dire state of his nation's finances and economy from almost everyone — from the IMF to political and corporate leaders. While they're warning that business confidence in Africa's most industrialized nation is close to an all-time low, Ramaphosa's own finance minister has taken to Twitter to vent his frustration at the slow pace of reform. Ramaphosa's office said today it's making progress, but it will take time. What to Watch This Week Emmanuel Macron makes the first visit to Warsaw by a French head of state in six years today as he seeks to mend ties strained by his criticism of Poland's drive to politicize its courts and its rejection of a deal with Airbus. Vice President-elect Lai Ching-te will make the most high-profile visit to the U.S. by a Taiwanese politician in decades when he attends the National Prayer Breakfast in Washington on Wednesday, setting up the possibility of a meeting with Trump. Malawi's top court is due to rule today whether to annul last year's elections after the opposition claimed the vote that returned President Peter Mutharika to power was rigged. Trump is scheduled to meet Kenyan President Uhuru Kenyatta in Washington on Thursday when they will announce the start of talks on a free-trade deal, the U.S.'s first with a sub-Saharan nation. The eighth Democratic presidential debate is scheduled for Friday in Manchester, New Hampshire. Thanks to all who responded to our pop quiz Friday and congratulations to reader Donald Douglas, who was the first to correctly name Matteo Salvini as the European politician who failed to score a knock-out blow in a regional vote to accelerate his rise to national power. Tell us how we're doing or what we're missing at balancepower@bloomberg.net. And finally ... Vietnamese businessman Quach Ngoc Thien sleeps fitfully, reaching for his iPhone each morning to scan news from faraway capitals that could threaten his fabric-dyeing company. That's because Vietnam, the bloodiest battlefield of the Cold War five decades ago, finds itself at the nexus of U.S.-China rivalry. Its ability to dance between opposing forces has lifted the country from postwar poverty to economic success. But needing unfettered access to U.S. markets and imports from China, it increasingly feels squeezed, as John Boudreau and Nguyen Dieu Tu Uyen report. A Thai Son S.P. Co. plant north of Ho Chi Minh City. Photographer: Maika Elan for Bloomberg Markets   You received this message because you are subscribed to the Bloomberg Politics newsletter Balance of Power. 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