Tag: Coronavirus

The coronavirus outbreak, which originated in China, has infected tens of thousands of people. Its spread has left businesses around the world counting costs.

Here are eight key maps and charts to help you understand the impact seen on different economies and industries so far.
Growth could stagnate

If the economy is growing, that generally means more wealth and more new jobs.

It’s measured by looking at the percentage change in gross domestic product, or the value of goods and services produced, typically over three months or a year.

The world’s economy could grow at its slowest rate since 2009 this year due to the coronavirus outbreak, according to the Organisation for Economic Cooperation and Development (OECD).

The think tank has forecast growth of just 2.4% in 2020, down from 2.9% in November.

It also said that a “longer lasting and more intensive” outbreak could halve growth to 1.5% in 2020 as factories suspend their activity and workers stay at home to try to contain the virus.

Global shares take a hit

Investors have been worried about the impact of the coronavirus as it spreads outside of China.

Big shifts in stock markets, where shares in companies are bought and sold, can affect investments in some types of pension or individual savings accounts (Isas).

The last week of February saw the worst performance for major stock markets since the 2008 financial crisis.

European and US stock markets have seen a slight uptick since then as it’s hoped that countries will intervene to protect economies from the coronavirus outbreak.

The US central bank, for example, slashed interest rates in response to mounting concerns. That should, in theory, make borrowing cheaper and encourage spending to boost the economy.

Factories slowing down

China makes up a third of manufacturing globally, and is the world’s largest exporter of goods.

But activity has decreased in the so-called “workshop of the world” as factories pause their operations to try to contain the spread of Covid-19.

Nasa said pollution-monitoring satellites had detected a significant drop in nitrogen dioxide over the country. Evidence suggests that’s “at least partly” due to the economic slowdown caused by the outbreak.

Restrictions have affected the supply chains of big companies such as Diageo, JCB and Nissan, who rely on China’s production and its 300 million migrant workers. Jaguar Land Rover even said it had flown car parts in suitcases as some factories run out of parts for vehicles.

Customers buying less

Fear of the coronavirus outbreak means that some people are choosing to avoid activities that might expose them to the risk of infection, such as going out shopping.

Restaurants, car dealerships and shops have all reported a fall in customer demand.

Chinese car sales, for example, dropped by 92% during the first half of February. More carmakers, like Tesla or Geely, are now selling cars online as customers stay away from showrooms.

Shipments of smartphones are also expected to take a big hit in the first half of 2020, before seeing a recovery later on.

Apple was one tech giant who said sales had been affected by low customer demand.

Travel among hardest hit

The number of cases diagnosed is increasing around the world every day. Many countries have introduced travel restrictions to try to contain the virus’s spread.

For example, the UK government advises against all travel to the Hubei province in China, where the virus originated. It’s also issued special travel advice for Italy, which was the first European country to report a major surge in cases.

The travel industry has been massively impacted, with airlines cutting flights and tourists cancelling business trips and holidays.

Data from analytics firm ForwardKeys shows international flights booked from China are behind by 55.9% in comparison with the same period in 2019.

UK travel industry experts have expressed concerns about Chinese tourists being kept at home. There were 415,000 visits from China to the UK in the 12 months to September 2019, according to VisitBritain. Chinese travellers also spend three times more on an average visit to the UK at £1,680 each.

As more large-scale events are cancelled and the number of flight cancellations increases, there are fears the industry could take a bigger hit.

Some bright spots

It can be hard to find positives when people’s jobs are affected, or – as in the case of the coronavirus outbreak – lives are being lost.

But in purely business terms, there are some bright spots. Consumer goods giant Reckitt Benckiser, for example, has seen a boost in sales for its Dettol and Lysol products.

The disinfectant is seen as providing protection against the spread of the disease, although its effectiveness has not yet been scientifically proven.

The price of gold – which is often considered a “safe haven” in times of uncertainty – has also increased. Its spot price hit a seven-year high of $1,682.35 per ounce in February.

Investors are looking to it amid fears the coronavirus spread outside of China will further hit the global economy and demand.

Source: bbc.com

Almost 300 million students worldwide faced weeks at home on Thursday with Italy the latest country to shut schools over the deadly new coronavirus, as the IMF urged an all-out, global offensive against the epidemic.

More than 95,000 people have been infected and over 3,200 have died worldwide from the virus, which has now reached some 80 countries and territories.

The vast majority of global deaths and infections are in China, where the virus first emerged late last year, prompting the country to quarantine entire cities, temporarily shut factories and close schools indefinitely.

As the virus spread, other countries have also implemented extraordinary measures, with UNESCO saying Wednesday that 13 countries have closed schools, affecting 290.5 million children, while nine others have implemented localised closures.

While temporary school closures during crises are not new, UNESCO chief Audrey Azoulay said, “the global scale and speed of the current educational disruption is unparalleled and, if prolonged, could threaten the right to education.”

Italy on Wednesday ordered schools and universities shuttered until March 15, ramping up its response as the national death toll rose to 107, the deadliest outbreak outside China.

South Korea — the country with the largest number of cases outside China with nearly 6,000 — has postponed the start of the current term until March 23.

In Japan, nearly all schools are closed after Prime Minister Shinzo Abe called for classes to be cancelled through March and spring break, slated for late March through early April.

Some 120 schools closed in France this week in areas with the largest numbers of infections.

Economic threat

The German health minister said the outbreak was now a “global pandemic” — a term the World Health Organization has stopped short of using, meaning the virus is spreading in several regions through local transmission.

Infections are now rising faster abroad than they are in China, where 31 more deaths and 139 new cases were reported Thursday. China’s death toll now stands at 3,012, with over 80,000 infections.

From western Europe to eastern Asia, supermarket shelves have been stripped of supplies in recent weeks, including toilet paper and hand sanitiser.

American businesses are increasingly concerned over access to goods and the overall economic outlook is more uncertain, the US Federal Reserve said in its beige book survey released on Wednesday.

With the US toll rising to 11 on Wednesday, lawmakers in Congress reached a deal to provide more than $8 billion to fight the outbreak.

The virus impact has spread beyond supply chains — stock markets have rumbled as warnings from financial bodies mount that countries could be pushed into recession.

The IMF said the epidemic posed a “serious threat” and would slow global growth to below last year’s 2.9 percent.

“At a time of uncertainty… it is better to do more than to do not enough,” IMF chief Kristalina Georgieva said.

The epidemic “is a global problem calling for global response,” she said.

Eurozone ministers agreed after a meeting that they were ready to “use all appropriate policy tools to achieve strong, sustainable growth”.

No kissing

As the virus continues its march across the world, governments are scrambling to tighten prevention efforts.

Italy has seen its outbreak swell despite tough measures, including a quarantine of 11 towns with 50,000 people.

New measures include a month-long nationwide ban on fan attendance at sports events, as well as advising people to avoid greetings like kissing on the cheek or shaking hands.

Prime Minister Giuseppe Conti said the country could tackle the outbreak as long as it remained contained.

“But in case of exponential growth, not just Italy but any other country in the world would not be able to manage the situation,” he said.

In Iran, where 92 people have died from the disease, schools have been shut and major cultural and sporting events suspended.

Saudi Arabia has suspended the year-round “umrah” pilgrimage, an unprecedented move that raises fresh uncertainty over the annual hajj.

Countries also continue to crack down on international travel.

Even cinemagoers were not immune from the effects of the virus — the producers of the latest James Bond film pushed back the release of the forthcoming “No Time To Die” from April to November.

Source: AFP

The Information Commissioner’s Office (ICO) has fined Cathay Pacific Airways £500,000 for failing to protect customers’ personal data.

The UK watchdog said the airline’s computer systems had exposed details of 111,578 UK residents and a further 9.4 million people from other countries.

These included names, passport details, dates of birth, phone numbers, addresses and travel history.

“Appropriate security” was not in place between October 2014 and May 2018.

The ICO said Cathay Pacific became aware of a problem in March 2018, when it suffered a “brute force” password-guessing attack.

The Hong Kong-based firm reported this to the ICO. The regulator said it subsequently uncovered “a catalogue of errors” during a follow-up investigation, including:

-back-up files that were not password protected

-internet-facing servers without the latest patches

-operating systems that were no longer supported by the developer

-inadequate anti-virus protection

At least one attack involved a server with a known vulnerability – but the fix was never applied, despite having been public knowledge for more than 10 years.

Steve Eckersley, the ICO’s director of investigations, said there were “a number of basic security inadequacies across Cathay Pacific’s system, which gave easy access to the hackers”.

The airline failed four out of five of the basic cyber-essentials guidance from the National Cyber Security Centre, he added.

Source: bbc.com

There are fears of global shortages of some common drugs after India limited the export of certain medicines due to the coronavirus.

The world’s biggest supplier of generic drugs has restricted exports of 26 ingredients and the medicines made from them.

The restricted drugs include Paracetamol, one of the world’s most widely-used pain relievers.

It comes as many drug ingredient makers in China remain shut or cut output.

India’s drug makers rely on China for almost 70% of the active ingredients in their medicines, and industry experts have warned that they are likely to face shortages if the epidemic continues.

“Even drugs that aren’t produced in China get their base ingredients from China. Globally there could be a shortage if China and India both get hit,” warned analyst Shaun Rein from the China Market Research Group.

The list of ingredients and medicines accounts for 10% of all Indian pharmaceutical exports and includes several antibiotics, such as tinidazole and erythromycin, the hormone progesterone and Vitamin B12.

Oxford Economic’s lead economist Stephen Foreman told the BBC that there are indications that the scarcity of ingredients is already forcing up prices: “There are already signs that the reduction in supply to India has pushed up prices there considerably.”

The Indian government has urged calm over its announcement and said there were enough stocks to last for up to three months.

In 2018 Indian imports accounted for almost a quarter of US medicines and more than 30% of medicine ingredients, according to the US Food and Drug Administration (FDA).

FDA Commissioner Stephen Hahn told US senators on Tuesday that the agency is working to determine how the restrictions will affect America’s medical supply and its effect on essential medicines.

Major US pharmaceutical companies have said they are monitoring their supply chains.

Mylan warned last week that there could be drug shortages, while Eli Lilly said it does not expect the coronavirus outbreak to result in shortages for any of its therapies, including insulin products.

Source: bbc.com

European markets have climbed for a second day on hopes that governments and central banks will intervene to tackle the economic hit of coronavirus.

The FTSE 100 climbed more than 2% in London and there were similar gains on other European markets.

The Dow Jones in New York surged by 5.1% on Monday, although Japanese shares closed 1.2% lower on Tuesday.

The rebounds follow the worst week for major stock markets since the 2008 financial crisis.

The G7 is expected to release a statement later today or tomorrow as policymakers struggle to respond to the global spread of the virus, but there are concerns that it may not mention any new government spending or coordinated interest rate cuts.
‘A fiscal version of the Avengers’

Connor Campbell, financial analyst at Spreadex, likened the group to a “fiscal version of the Avengers” superheroes. He said even that the announcement of the G7 action plan “was enough to point markets in the right direction”.

Investors have been worried about the impact of the coronavirus as it spreads outside of China. Already, the outbreak has led to travel restrictions, manufacturing shortages and reduced shopper demand in some countries.

On Tuesday, Australia’s central bank cut interest rates to record lows, in what is expected to be the first in a spate of stimulus measures around the world to fight the economic impact of the coronavirus outbreak.

Reserve Bank of Australia governor Philip Lowe said: “The board took this decision to support the economy as it responds to the global coronavirus outbreak.”

US President Donald Trump seized on the opportunity to encourage the US Federal Reserve to “cut rate big”.

‘Closely monitoring’

The Bank of England said on Monday that it continued to monitor developments and is assessing its potential impacts on the global and UK economies and financial systems.

“The Bank is working closely with HM Treasury and the FCA (Financial Conduct Authority) – as well as our international partners – to ensure all necessary steps are taken to protect financial and monetary stability,” a Bank spokesman said.

The European Central Bank said it was “closely monitoring developments and their implications for the economy, medium-term inflation and the transmission of our monetary policy. We stand ready to take appropriate and targeted measures, as necessary and commensurate with the underlying risks.”

The US Federal Reserve put out a similar statement last week.

The comments come as economic groups revise growth forecasts to account for the virus.

On Monday, the Organisation for Economic Cooperation and Development (OECD) also said it expected growth of just 2.4% in 2020, down from 2.9% in November and warned that a longer “more intensive” outbreak could halve growth to 1.5%.

Source: bbc.com