Greece loses friends, the desert blues, the end of China’s migrant miracle

The daily briefing “FirstFT” from the Financial Times.

The International Monetary Fund has warned Greece’s eurozone creditors that it is so far off course on its $172bn bailout programme that it risks losing vital IMF support unless lenders write off significant amounts of sovereign debt. (FT)

The warning raises the prospect of the fund withholding some of the EUR7.2bn of bailout aid that Greece is desperately attempting to secure to avoid bankruptcy.

Yanis Varoufakis is in Paris today trying to make amends with Michel Sapin, the French finance minister who was one of Greece’s last remaining supporters but has recently joined the criticism directed at his Greek counterpart. (FT)

Gideon Rachman argues that the relationship between the Greek government and the rest of the eurozone is increasingly like a bad marriage. His solution? Grexit. “The relationship is broken. It is time for both sides to make a fresh start.” (FT)

In the news

RBA rate cut The Reserve Bank of Australia cut interest rates to a record low of 2 per cent in a bid to support the economy as it transitions away from the mining boom. The price of iron ore, Australia’s biggest export, has fallen sharply since the central bank last cut rates in February, while the dollar has remained elevated. (FT, WSJ)

An unsatisfying meal McDonald’s unveiled a long-awaited restructuring plan that left some investors wondering, “where’s the beef?”, with shares down nearly 2 per cent on Monday. The plan acknowledges that the company has failed to keep up with rapidly changing consumer tastes, which have seen customers opting for fresher, more natural fare over greasy burgers and fries. (FT, BBC, WSJ)

Texas gunman already a terrorism suspect The FBI was already monitoring one of the two gunmen who were shot dead after opening fire at a Dallas exhibition of Muhammad caricatures. Elton Simpson was convicted in 2011 of lying to FBI agents and denying that he had made plans to travel to Somalia. A new investigation was opened a few months ago after he started posting about Isis on social media. (NYT)

Jean-Marie Le Pen suspended The National Front suspended its founder for calling Nazi gas chambers “a detail” – highlighting a fracture between the old guard and a new generation led by Marine Le Pen, who has sought to tone down the xenophobic rhetoric. Jean-Marie Le Pen said of his daughter, who is the current party leader: “I don’t acknowledge any link with someone who betrays me in such a scandalous manner”. (FT)

Carly Fiorina joins the fray The former Hewlett-Packard chief executive joined the Republican field and became the second woman to enter the 2016 presidential race. The Republican field is expected to be the widest and most diverse in years, whereas Hillary Clinton’s only challenger so far is Bernie Sanders, an independent senator from Vermont. (FT)

Lula inquiry Brazil’s federal prosecutors opened an investigation into former president Luiz Inacio Lula da Silva for illicit influence peddling in Cuba – adding to the pressure on his protegee Dilma Rousseff. He is being questioned by the anti-corruption unit over claims he helped construction conglomerate Odebrecht win contracts overseas. (FT)

Matteo Renzi’s electoral reform victory Italy’s prime minister got a green light for a new law, which would assign extra seats to the winning party in future elections. It is designed to ease political gridlock and diminish the frequency of the government collapses that have long been a feature of Italian politics. (FT)

It’s a big day for

The US military President Obama will nominate Marine General Joseph Dunford as the next chairman of the Joint Chiefs of Staff. Dunford earned the nickname “Fighting Joe” on the battlefields of Iraq, where he helped lead forces during the US invasion in 2003, and is expected to be confirmed quickly by the Senate. (Reuters)

Clinton Cash The investigation into donations made to the Clinton Foundation, which has heightened scrutiny of Hillary Clinton’s finances, hits the shelves today. The book asserts thatforeign entities received favours from the state department in return for payments to the foundation and Bill Clinton’s speaking fees. (NYT)

Food for thought

Life beyond the leveraged buyout The 30-year-old model – under which private equity groups use debt to buy and remodel a company, then cut costs to raise cash to pay it back – is being disrupted by the end of cheap debt and venture capital groups. (FT)

The Golden Loaf A gold ornament shaped like a loaf of bread has gone missing from the mansion of former Ukrainian president Viktor Yanukovich. It used to be a symbol of the corrupt leader’s regime but its mysterious disappearance has made it a symbol of Ukraine’s inability to clear up the dysfunctional state that Yanukovich left behind. (WSJ)

Desert blues Mali had one of the world’s most vibrant music scenes and the Festival in the Desert flourished until it had to be cancelled because of conflict in the north. Joshua Hammer tells the story of Manny Ansar, who set up the event, and Iyad Ag Ghali, a friend who had inspired the festival but is now commanding jihadist fighters and sees the event as an affront to his vision for an Islamic state in Mali. (The Atavist)

Good riddance to the election campaign It has been a “carnival of nonsense and futility” , says Janan Ganesh, who thinks the competing parties have embarrassed the country by avoiding fiscal reality and the state of the world. (FT)

Video of the day

The end of China’s migrant miracle The migration of labour from the unproductive farm sector to work in factories and construction sites is almost exhausted and its labour force is shrinking. The FT examines how the drying up of the labour force and rising wages will drive huge economic change. Watch the video explaining the end of rural surplus labour, see China’s staggering scale of human movement mapped out, or find out more from our Big Read.

This article is published in collaboration with The Financial Times. Publication does not imply endorsement of views by the World Economic Forum.

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Author:  FirstFT is the Financial Times’ editors curated free daily email of the top global stories from the FT and the best of the rest of the web.

Image: A Greek and a European Union flag fly outside the Bank of Greece in Athens. REUTERS/John Kolesidis.