A trillion reasons

Follow Us Get the newsletter

As the U.S. and its allies rush to evacuate Afghanistan, China is setting its sights on the country's vast mineral wealth. Since the fall of Kabul this month, Chinese analysts and state-run media have touted the potential to develop untapped reserves worth more than an estimated $1 trillion. Smartphones and electric vehicles have created new demand for Afghanistan's rare earths and lithium. China, which has invested $60 billion in neighboring Pakistan, is well positioned to dig them up and transport them to its factories. Yet as Iain Marlow and Enda Curran explain, this will be hard to pull off in reality. Four decades of war, including with the Soviet Union and later the U.S., stopped it from happening — and there's little sign that will change. What happens in the next few weeks will be key. The Taliban must first allow a smooth evacuation, form an inclusive government and do enough on human rights to prompt the U.S. and its allies to ease sanctions. Already reports of indiscriminate killings and suppression of women are flooding in. The West also faces a dilemma: Embracing the Taliban could spur a political backlash, while isolating the group risks empowering more radical elements. U.S. President Joe Biden could still choose to stop most companies from doing business in the country. China clearly sees engagement and development as the best way to ensure stability. And if all goes right, it could secure a massive supply of raw materials for high-tech goods in the process. — Daniel Ten Kate

A transport plane takes off from Kabul on Monday as stranded Afghans watch. Photographer: Marcus Yam/Los Angeles Times/Getty Images Click here to follow Bloomberg Politics on Facebook and tell us how we're doing or what we're missing at balancepower@bloomberg.net.

Global Headlines

Resisting pressure | Biden dismissed mounting calls to keep U.S. troops in Afghanistan past the Aug. 31 deadline but ordered his national security team to come up with contingency plans if he decides a delay is needed. The president said the risks to troops are growing and expressed confidence the U.S. could evacuate a substantial number of Americans and Afghan allies. U.S. Vice President Kamala Harris urged Asian countries to apply more pressure on China in a meeting with Vietnam's president. Budget victory | Biden received some good news yesterday when the House adopted a $3.5 trillion budget resolution that advances his economic agenda. Already passed by the Senate, the bill now goes to committees that will write the details into tax and spending legislation that both chambers will vote on later this year. House Democrats, moving to counter a wave of Republican state-level initiatives to restrict ballot access, passed legislation to restore portions of the historic 1965 Voting Rights Act, adding pressure on the Senate to break a logjam. South Africa's unemployment rate surged to the highest on a global list of 82 countries monitored by Bloomberg, rising to 34.4% in the second quarter. Losing grip | Chancellor Angela Merkel's conservative bloc is on the offensive as polls show its years-long lead over the Social Democratic Party evaporating less than five weeks before Germany's federal elections. In a Bloomberg webinar yesterday, Markus Soeder, who heads the Bavarian faction of Merkel's bloc, claimed a Social Democratic-led government would abandon balanced budgets and introduce "massive" tax increases after the party called for looser fiscal policy and new taxes on the rich. Border clash | A divided U.S. Supreme Court rejected the Biden administration's rescinding of a Trump-era immigration policy concerning asylum seekers entering from the border with Mexico. The court left in force a ruling requiring the resumption of a process, halted in June, that has forced almost 70,000 people to remain in Mexico while their applications are processed. Best of Bloomberg Opinion No, China Isn't About to Try Its Luck With Taiwan: Minxin Pei Press Has Not Turned Hawkish on Afghanistan: Ramesh Ponnuru India Can Learn From Australia's Asset Recycling: Andy Mukherjee   Dangerous leaks | Invisible plumes of methane, which has more than 80 times the warming power of carbon, are escaping from sites in Romania, one of the European Union's top producers of oil and gas, according to the nonprofit Clean Air Task Force. The leaks highlight a challenge for European policy makers who proposed sweeping measures to decarbonize the EU's economy but have yet to pass laws to tackle methane. What to Watch  Brazilian President Jair Bolsonaro has no plans to interfere with the central bank despite his growing unease about inflation in the run-up to general elections next year. The ruling parties of Japan and Taiwan will hold their first security talks this week, with bilateral concerns about increasing Chinese military strength likely to be top of the agenda. Former University of Georgia and National Football League star Herschel Walker is running for a U.S. Senate seat in Georgia at the urging of former President Donald Trump. China made the first arrest in a sexual-assault case involving a former Alibaba manager that has sparked debate about sexism in the nation's tech industry. Some of the largest U.S. food distributors are turning away customers and having trouble getting food to stores on time as they struggle to find people to drive trucks and work in warehouses and processing plants. And finally ... The world's electricity generators are now polluting more than before the pandemic, putting global net-zero targets at risk. While wind and solar generated more than 10% of the world's electricity, overtaking nuclear power, the use of coal, particularly in China and other Asian countries where demand for power is rising, caused global energy-industry emissions to exceed 2019 levels by 5%, according to London-based researcher Ember. Vapor rises from the cooling towers of a coal-fired power plant in Poland. Photographer: Bartek Sadowski/Bloomberg

Like Balance of Power? Get unlimited access to Bloomberg.com, where you'll find trusted, data-based journalism in 120 countries around the world and expert analysis from exclusive daily newsletters. You received this message because you are subscribed to Bloomberg's Balance of Power newsletter. Unsubscribe | Bloomberg.com | Contact Us Bloomberg L.P. 731 Lexington, New York, NY, 10022