(Bloomberg) —

In the daily onslaught of news — from the coronavirus to the U.S. presidential race — it would have been easy to miss a little fracas in the Baltics this week.

On Tuesday, the Chinese embassy in Tallinn issued a blunt statement slamming the “ignorance, prejudice as well as a Cold War mindset” displayed by Estonia’s foreign intelligence service in its annual report.

The document, published the previous week, was critical of China’s overseas investments, which the service said were used for political purposes and represented a security threat.

China’s response was far from unprecedented. Earlier this month, its embassy in fellow Baltic state Lithuania expressed “grave dissatisfaction” at a similar security assessment. China’s ambassador to Norway, Yi Xianliang, rebutted a Norwegian Intelligence Service report that concluded China posed a growing threat. China’s envoy in Sweden has a record of run-ins with the government there.

The wall of pushback is a reminder that China remains a prickly partner for Europe, even as U.S. pressure might be expected to push Beijing and Brussels closer together. The European Union, President Donald Trump said last month, treats the U.S. “worse than China.”

Trump’s appointment as acting director of national intelligence of Richard Grenell, the combative U.S. ambassador to Germany, suggests Europe will remain firmly in his sights.

With an emboldened Trump in the White House, Europe may have nowhere left to turn.

Global Headlines

Taking fire | Michael Bloomberg came under sustained attack in a spirited Democratic debate that saw Elizabeth Warren compare him to Trump in his treatment of women and Bernie Sanders assail him over his attitude toward minorities. The focus on Bloomberg deflected some of the heat that Sanders might have otherwise gotten from his rivals as the current front-runner in the race, though he didn’t completely escape criticism, particularly from Pete Buttigieg. The debate came at a pivotal moment, with the Nevada caucuses Saturday, followed a week later by a primary in South Carolina.

(Bloomberg is the founder and majority owner of Bloomberg LP, the parent company of Bloomberg News.) Click here for more key takeaways from last night’s face-off.

Economic impact | The White House has acknowledged what many economists considered obvious through much of last year: Its trade stance depressed economic growth and business investment. “Uncertainty generated by trade negotiations dampened investment,” Trump chief economist Tomas Philipson told reporters in an annual briefing. The admission contrasted with the president’s repeated assertions that his tariff tactics hadn’t hurt the economy while swelling the government’s tax coffers.

Iran’s pain | When Hassan Rouhani was elected president of Iran in 2013, supporters hoped he’d revive the country’s fortunes and its relationship with the rest of the world. But as Golnar Motevalli explains ahead of parliamentary elections tomorrow, even amid U.S. sanctions pressure, the shooting down of a Ukrainian passenger jet full of Iranians by their own military last month provides a tragic reminder of how the country has alienated the very people who swept Rouhani to power.

Seeking redemption | Saudi Arabia is hoping to repair its tarnished international reputation when it welcomes leaders from the world’s biggest economies this weekend. Officials see the Group of 20 meeting of finance ministers and central bank governors as a chance to highlight the Kingdom’s reforms that have been overshadowed by outrage over a murdered critic, a crackdown on dissent and Riyadh’s leading role in the grinding five-year war in Yemen.

Rising star | Giorgia Meloni has gone from bartending at a Roman nightclub to leading one of Italy’s main political forces — which traces its roots to fascism — and she’s now one of the most popular politicians in the nation. As John Follain explains, while the 43-year-old Meloni doesn’t define herself as a feminist, she’s aiming to become Italy’s first woman prime minister.

What to Watch

EU leaders travel to Brussels today to thrash out the bloc’s next long-term budget. Trump ally Roger Stone’s sentencing today has become a test of judicial independence after the president inserted himself in the court’s deliberations. Ireland’s parliament meets to try to choose a prime minister, the first step in what’s likely to be a prolonged search for a new government. U.S. Secretary of State Michael Pompeo has criticized China’s move to revoke the press credentials of three Wall Street Journal reporters over a controversial headline, a decision that comes as Beijing continues to lash out at countries that fault its handling of the deadly coronavirus outbreak.

Tell us how we’re doing or what we’re missing at balancepower@bloomberg.net.And finally … Japan is emerging as one of the riskiest places for the spread of the coronavirus, prompting criticism of Prime Minister Shinzo Abe’s government. And with cases mounting internally to 84 — tying with Singapore for the highest outside China — Tokyo received a rare rebuke from the U.S. Centers for Disease Control and Prevention over its management of the quarantine on the Diamond Princess cruise ship, where infections surged during two weeks docked in Yokohama.

 

–With assistance from Ruth Pollard and Gordon Bell.

To contact the author of this story: Alan Crawford in Berlin at acrawford6@bloomberg.net

To contact the editor responsible for this story: Karl Maier at kmaier2@bloomberg.net, Kathleen Hunter

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