Dear Focus Reader,

This week, tensions between Israel and Iran rapidly escalated as both sides exchanged strikes in their most intense confrontation in years. With Israeli airstrikes reportedly killing key Iranian military leaders and hitting civilian areas, and Iranian missiles striking an Israeli hospital, pressure is mounting on President Trump to consider U.S. military involvement. Trump has said he will decide within two weeks whether to authorize a U.S. strike on Iran, as his administration weighs the risks of escalation.

Meanwhile, China and Russia are positioning themselves as voices of restraint amid the crisis. In a phone call on Thursday, Presidents Xi Jinping and Vladimir Putin condemned Israel's actions, calling them violations of the UN Charter and international law. Xi urged all parties—especially Israel—to cease fire quickly to avoid further escalation and regional spillover. He also sent a veiled message to the U.S. president, emphasizing that "major powers" should work to cool tensions, not worsen them.

On the economic front, last week in London, the U.S. and China reached a tentative trade truce. While China agreed to expedite export licenses for some non-military rare earth magnets, key restrictions on defense-related materials remain unresolved. The U.S. continues to block exports of advanced AI chips to China due to potential military applications. Additionally, the Trump administration plans to extend existing tariffs beyond the August 10 deadline, signaling ongoing trade tensions.

Building on this complex trade landscape, China continues to advance its trade and diplomatic relations across the globe. This week, Premier Li Qiang met with New Zealand Prime Minister Christopher Luxon in Wellington to deepen their "comprehensive strategic partnership." Their talks focused on expanding cooperation in clean energy, digital technology, and trade, underscoring Beijing's efforts to strengthen ties with key U.S. allies amid shifting global alliances.

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