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Mission to relieve space-station crew shows nation’s growing capability and drive to rival U.S. beyond Earth

SINGAPORE—China sent its first civilian astronaut into orbit Tuesday as part of a new crew for its space station, showcasing the nation’s expanding capabilities in space at a time when mounting military and technological competition with the U.S. is stoking geopolitical tension.

The rocket carrying the Shenzhou-16 spacecraft and its three crew lifted off from a launch site in northern China’s Gobi Desert in the morning, beginning a trip of more than six hours to the Tiangong Space Station. The mission is the first since China finished building and fitting out the permanently manned orbital base, and as it prepares to venture deeper into space, sending astronauts to the moon and a probe to Mars.

Washington sees Beijing’s space program as another front in the deepening rivalry between the two, and has restricted exports of some technology and parts to prevent China from gaining an edge. The U.S. is gearing up for a potential conflict in space and has been strengthening its deterrence against China. In March, the White House proposed a $30 billion annual budget for its Space Force, almost $4 billion more than the previous year.

China accuses the U.S. of trying to contain its rise by denying access to the latest technologies. Chinese leader Xi Jinping has said that the “space dream is an important part of the dream to make China stronger,” while making a broad push for technological self-reliance. The country has invested heavily in its space program and has raced to build up a satellite-communications network. It has also developed ground-based missiles, lasers and more surveillance capabilities to deny adversaries access to space-based assets.

“Such demonstration of independent space capabilities adds to China’s great power status and as a rival alternative space power to the world,” said Namrata Goswami, an Alabama-based independent scholar on space policy.

Veteran astronaut Jing Haipeng, on his fourth mission, is accompanied by two first-timers, spaceflight engineer Zhu Yangzhu and payload specialist Gui Haichao, a professor at Beihang University in Beijing.

“We’re 20 years apart in age, which makes this a cross-generational team,” the 56-year-old Jing said Monday.

After a five-day handover, they will take over from the three crew members who have been aboard the Tiangong—which means “Heavenly Palace” in Chinese—since November. During their five-month mission, the newly arrived crew will conduct spacewalks, assist with the docking and departure of cargo and other spacecraft, and carry out scientific experiments.

The inclusion of a civilian dovetails with Beijing’s strategy of opening the space industry to the private sector, said Liu Bojian, a research assistant at the National University of Singapore who studies China’s activities in space. Previously, astronauts were all from the People’s Liberation Army’s Air Force.

“China is trying to make sure that in the next two decades it will have enough well-trained astronauts, both experienced and young, to prepare for even larger missions, such as landing on the moon, and even on Mars,” said Liu.

Lin Xiqiang, deputy director of the China Manned Space Agency, said on Monday that China aims to put astronauts on the moon before 2030, as the space race with the U.S. heats up. The U.S. plans its first return to the lunar surface in more than five decades as early as 2025.

The U.S. and Chinese space programs have developed independently of each other. Since 2011, China has been excluded by U.S. law from working with NASA, and its astronauts are barred from the International Space Station. But China’s Tiangong could be the only space station in operation if its older counterpart is decommissioned as planned in 2030.

“China’s space program is integrated into its civil-military fusion strategy…[and it] plans to challenge U.S. dominance on the moon within this framework,” said Goswami, who is the co-author of “Scramble for the Skies: The Great Power Competition to Control the Resources of Outer Space.” She points to China’s goal to bring back samples from the lunar South Pole and to set up a permanent research base on the moon.

In preparation for the mission, the Chinese space agency said it is developing a new carrier rocket, spacecraft and spacesuit, as well as a lunar lander.

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Re-elected Erdoğan insists interest rates should stay low despite inflation running at more than 40%

Turkey’s lira weakened in the aftermath of Recep Tayyip Erdoğan’s re-election, as analysts warned that the next big test for the victorious president would be addressing the country’s shaky $900bn economy.

Many economists argue that Erdoğan’s policies of low interest rates and emergency measures to prop up the currency cannot continue as Turkey’s stores of currency reserves rapidly decline.

The lira fell 0.6 per cent to a near record low of 20.2 against the US dollar as trading resumed in London, the primary hub for European currency trading, on Tuesday after a public holiday.

“The current policy stance has become unsustainable,” said Liam Peach at Capital Economics in London. “Turkey cannot continue with very low interest rates, very loose fiscal policy and burning through all sorts of foreign currency reserves for much longer.”

Turkey’s reserves have dropped by about $27bn this year as the country has attempted to prop up the lira and finance a current account deficit at near record levels.

Official data puts the reserves, including foreign currency and gold, at just above $101bn.

However, net reserves, a figure that strips out liabilities, are in effect zero, and deeply negative when excluding tens of billions of dollars in money borrowed from the local banking system, according to JPMorgan.

Clemens Grafe, an economist at Goldman Sachs in London, said reserves were now “close to levels when previously lira volatility sharply increased”.

But immediately after securing his victory in Sunday’s run-off vote with 52 per cent, Erdoğan insisted he would maintain his low-interest rate policy, even though inflation is currently above 40 per cent.

“If anyone can do this, I can do it,” he said. “[The central bank’s main interest rate] has now been reduced to 8.5 per cent and you’ll see inflation will also fall.”

He added that “eliminating the problems of price increases caused by inflation and the loss of welfare are the most urgent topics of the coming days” but gave no specifics.

Investors are also concerned about the equivalent of $121bn that Turks have put in special savings accounts paying out at the government’s expense if the lira depreciates.

The measure has slowed the rate at which Turks have been purchasing foreign currencies, but Nureddin Nebati, finance minister, said the accounts had cost the country roughly TL95.3bn ($4.7bn) since they were introduced in 2021.

The hit to public finances could increase rapidly if the lira falls faster in coming weeks.

Yet Erdoğan may be able to draw on new funding from allies in the Middle East and Russia, analysts maintain.

The president said last week that unnamed Gulf states had contributed funds to help stabilise Turkey’s markets, but he did not elaborate.

Erdoğan would probably receive a short-term boost from summer tourist cash receipts that tend to ease strains on the country’s finances, said Wolf Piccoli at the Teneo consultancy.

Turkey’s Bist 100 stock index, which has been boosted by locals seeking refuge from high inflation, also jumped more than 4 per cent on Monday. It has generally been lifted by high inflation as local investors seek opportunities for returns that can compete with rapid consumer price growth.

Some economists say that Erdoğan may appoint a new economic team, bringing back names that are well known to foreign investors.

“With the elections behind us, all eyes will be on the composition of the economic team and the credibility of the initial policy response,” said Ilker Domac at Citigroup.

But Domac also warned that it would be “increasingly challenging” for Turkey’s central bank to keep interest rates far below inflation, “particularly during the last quarter of the year and thereafter”.

Other economists signalled a greater degree of alarm.

“Be ready for the worst, which may entail formal capital controls or serious deposit flight from the banking system,” wrote Atilla Yesilada at the GlobalSource Partners consultancy in Istanbul.

Executives and early investors sold shares worth $22 billion

The SPAC boom cost investors billions. Insiders in the companies that went public were on the other side of the trade.

Executives and early investors in companies that went public via SPACs sold shares worth $22 billion through well-timed trades, profiting before share prices collapsed.

Some of the biggest winners were Detroit Pistons owner Tom Gores’s investment firm Platinum Equity, British billionaire Richard Branson and convicted Nikola NKLA -4.18%decrease; red down pointing triangle founder Trevor Milton. They were among many insiders who got shares on the cheap and sold them as they rose in value, according to a Wall Street Journal analysis of insider-trading disclosures associated with more than 200 companies that did SPAC deals.

Companies that went public this way have lost more than $100 billion in market value. At least 12 have filed for bankruptcy and more than 100 are running low on cash, battered by higher interest rates and rising costs.

Many executives claimed during the boom that SPAC mergers were a better way for companies to go public than traditional initial public offerings. “It’s easy to understand why executives at the companies went with this option,” said New York University Law School professor Michael Ohlrogge, who studies SPACs. “It wasn’t because it was a better financial technology—it was because it was just better for them.”

The Journal analyzed more than 460 companies that did SPAC deals and identified 232 with insider sales based on a review of Securities and Exchange Commission filings submitted through May 18. The analysis focused on disclosures made by investors who own more than 10% of a company and corporate officers and directors.

Of those with sales, insiders at 12 companies cumulatively sold shares worth at least $500 million. Insiders at about 80% of the 232 companies sold shares valued at less than $100 million, the Journal’s analysis shows. On average, insiders sold about $22 million of shares each.

One of the biggest paydays went to Platinum Equity. The private-equity firm sold shares of four companies that it had invested in before they went public via SPAC deals, generating some $2.3 billion in proceeds. Platinum Equity and Gores declined to comment.

Platinum’s biggest haul came from selling the stock of Vertiv Holdings VRT 6.65%increase; green up pointing triangle, a vendor of data-center infrastructure that was owned by Platinum before going public in 2020 through a $5.3 billion deal with a SPAC backed by Goldman Sachs.

As Platinum was selling stock in 2021 for between $20 and $25 a share, five pension funds were buying. In February 2022, Vertiv’s share price fell 37% on a single day, to $12.38, after the company announced disappointing financial results that one Deutsche Bank analyst described as “shockingly bad.” The pension funds collectively lost nearly $2.4 million.

Of those with sales, insiders at 12 companies cumulatively sold shares worth at least $500 million. Insiders at about 80% of the 232 companies sold shares valued at less than $100 million, the Journal’s analysis shows. On average, insiders sold about $22 million of shares each.

One of the biggest paydays went to Platinum Equity. The private-equity firm sold shares of four companies that it had invested in before they went public via SPAC deals, generating some $2.3 billion in proceeds. Platinum Equity and Gores declined to comment.

Platinum’s biggest haul came from selling the stock of Vertiv Holdings VRT 6.65%increase; green up pointing triangle, a vendor of data-center infrastructure that was owned by Platinum before going public in 2020 through a $5.3 billion deal with a SPAC backed by Goldman Sachs.

As Platinum was selling stock in 2021 for between $20 and $25 a share, five pension funds were buying. In February 2022, Vertiv’s share price fell 37% on a single day, to $12.38, after the company announced disappointing financial results that one Deutsche Bank analyst described as “shockingly bad.” The pension funds collectively lost nearly $2.4 million.

Branson, the company’s founder, sold nearly 75% of his shares for more than $1.4 billion before launch delays and high costs sent the stock down more than 90% from its all-time high and about 60% below the SPAC’s listing price. The proceeds of Branson’s sales were used to shore up his Virgin Group, whose travel and leisure businesses were battered by the pandemic, a spokeswoman said. Branson is still Virgin Galactic’s largest shareholder.

Venture capitalist Chamath Palihapitiya, head of the SPAC that took Virgin Galactic public, made $310 million from selling shares of the company, filings show. He has also spent $144 million to purchase shares and exercise options.

The former Facebook executive became known as the “SPAC King” for the hundreds of millions he made during the boom across deals like Virgin Galactic and personal-finance app SoFi Technologies SOFI 3.84%increase; green up pointing triangle. A spokesman for Palihapitiya declined to comment. SPAC executives receive ultracheap shares for taking companies public that increase their returns.

Also called a blank-check company, a SPAC is a shell firm that lists publicly with the sole intent of merging with a private company to take it public. After regulators approve the deal, the company going public replaces the SPAC in the stock market.

Insiders made more than $200 million at many other startups that merged with SPACs, including fuel-cell truck upstart Nikola, self-driving car technology maker Luminar Technologies LAZR 1.67%increase; green up pointing triangle and online gaming company Skillz.

Much of Nikola’s roughly $450 million in share sales went to founder Trevor Milton, who resigned from the company amid allegations of fraud in September 2020. The next year, Milton sold about $374 million of stock for a weighted-average price of about $11. He was convicted of securities fraud last October. Shares have since dropped below $1. A Nikola spokeswoman declined to comment.

Luminar is led by 28-year-old chief executive Austin Russell, who recently led a bid to acquire business-media outlet Forbes. It went public through a SPAC backed by private-equity billionaire Alec Gores, the brother of Platinum Equity’s Tom Gores.

Russell took in $220 million selling some of his Luminar shares in July 2021 at a price of $21 a share, filings show. The sale was to institutional investors in a private placement, a spokeswoman said. On Friday, Luminar shares closed at $6.68. Russell also paid $31 million to buy shares in 2022 and 2023, at an average cost of $6.81 per share. Russell’s compensation is tied to the stock’s performance.

Two of Alec Gores’s SPACs took companies owned by his brother’s Platinum Equity public, and the Gores brothers recused themselves from negotiations. Insiders have made about $700 million in sales from one of those companies, Verra Mobility VRRM 0.23%increase; green up pointing triangle, a technology provider for fleet management. Tom Gores’s Platinum Equity accounted for most of those sales. Verra is another rare case where the stock has risen after its SPAC deal.

“These company owners were aware the valuation the SPAC was giving them was exceptionally generous,” Ohlrogge said. “It’s a no-brainer to take advantage of that.”