Transactions. Restructuring. Transformation. Financial Engineering - Eight International
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Daily COVID19 Global Economy Newsletter April 30, 2020
Transactions. Restructuring.
Transformation. Financial Engineering.
GLOBAL INSIGHT
Global $6 trillion The coronavirus pandemic will cause the global economy to shrink
slump may be 4% in 2020, according to a Bloomberg Economics estimate that
optimistic, assumes a recovery starts in the second half of the year,/
Bloomberg Economics
economists warn
Europe further Europe took another step toward life after lockdown as France,
easing lockdown Spain and Greece unveiled details of how they plan to emerge
from the coronavirus and cautiously restart economies crippled by
the pandemic,/ Bloomberg
ECB to judge if The European Central Bank will decide today if more than 1 trillion
trillion-Euro euros ($1.1 trillion) in asset purchases and a generous lending plan
are enough to keep companies and households afloat during an
stimulus is enough
historic slump./ Bloomberg
While almost all countries are following similar approaches, there
Covid-19 daily cases appears to be a difference between those who want to flatten and
around the world those who want to bend their COVID-19 curves. Countries such as
Australia and New Zealand seem to be trying to suppress the virus
entirely, with daily new cases below 100 before relaxing
restrictions. That is consistent with bending. In contrast, countries
in Europe and individual US states appear willing to ease
lockdown measures subject to the constraint of the reproduction
rate being below 1 and the health system not being overwhelmed,
even if that means an ongoing presence of the virus./ Fathom
Consulting
Social distancing According to a group of Harvard disease experts, some form of
until 2020 intermittent social distancing may need to be in place until 2022./
WEF & Statista
Tax-dodging corporations with outposts in offshore havens risk
No virus aid for tax being left high and dry when European nations hand out vast
exiles in France, bailouts to companies devastated by the Covid-19 pandemic. A
Poland and growing number of countries said they may exclude companies
Denmark based in the Cayman Islands, Panama, the U.S. Virgin Islands and
other states on a European Union blacklist of “non-cooperative
jurisdictions for tax.”/ Bloomberg
Virus labor market The damage to labor markets around the world is proving far
damage could more severe than initially estimated after governments extended
equate to 305 shutdowns to damp the spread of the coronavirus. The
million jobs International Labour Organization said yesterday that working
hours will be 10.5% lower this quarter than before the crisis started,
equivalent to 305 million full-time jobs. / Bloomberg
COVID-19 is taking its toll on the world, causing deaths, illnesses, The Impact of economic despair and pushing about 40-60 million people into COVID-19 on global extreme poverty, with the World Bank’s best estimate being 49 poverty million./ World Bank
FRANCE
Current GDP level in France./ Frederik Ducrozet - Pictet Wealth
Management
INSEE’s growth report showing how sharply France’s economy
shrank/ The Guardian
A turnaround in France helped Orange post growing first quarter
revenues, though store closures in Europe during the coronavirus
outbreak dented equipment sales and hindered efforts to roll out
new fibre optic broadband connections./ Reuters
UK
Boris Johnson’s most powerful political aide pressed the U.K.’s
independent scientific advisers to recommend lockdown
measures in an effort to stop the spread of coronavirus, according
to people familiar with the matter./ Bloomberg
According to a report by the Institute of Economic Affairs the
coronavirus pandemic could last for two years, coming in a series
of waves of which the second could cause most damage. The
impact will include a significant economic contraction, a debt
crisis and retreat from globalization. It’ll also destroy low-skill,
entry-level jobs./ Bloomberg
Britain’s competition regulator said it has opened investigations
into thousands of complaints about companies refusing to pay
refunds for cancelled weddings and other events during the
coronavirus pandemic./ Reuters
SPAIN
Spanish real GDP -5.2% QoQ is below expectations with private
consumption and investment in free fall./ Frederik Ducrozet -
Pictet Wealth Management
ITALY
Moody’s expects Italy’s economy to contract by 9.3% this year due
to the impact of the new coronavirus and grow 6.1% in 2021, the
ratings agency’s chief economist, Mark Zandi, told La Stampa
newspaper in an interview published today./ Reuters
Ratings agency Fitch cut Italy’s government debt grade, the first
downgrade to a major economy to reflect the surge in public debt
that is expected to hit countries dealing with the vast costs of the
coronavirus lockdown. Fitch expects the outbreak to shrink the
Italian economy by 8% this year and that there's a risk of a deeper
downturn./ Fitch
GERMANY
The German economy will contract by more than 6% this year,
the DIW economic institute said on Wednesday, adding that the
recession prompted by the coronavirus pandemic would be
deeper than during the 2008 financial crisis./ Reuters
With the coronavirus pandemic unleashing a wave of job losses,
bankruptcies and factory closures across the world, Germany's
GDP is due to shrink 6.3% in 2020, the government announced on
Wednesday. "We will experience the worst recession in the history
of the Federal Republic" which was founded in 1949, Economy
Minister Peter Altmaier said. The economic blow would surpass
the one left by the global crisis of 2009, which saw Germany's
economy shrink by over 5%./ DW
OTHER LOCAL NEWS
Sweden did not impose a full lockdown on public life or
businesses, despite the coronavirus outbreak. Data released from
the country’s central bank and a leading Swedish think tank show
that the economy will be just as badly hit as its European
neighbors. Sweden’s central bank, the Riksbank, gave two possible
scenarios for the economic outlook in 2020, both are bleak./ CNBC
SECTOR NEWS
Global market data (as of April 30, 2020)./ Reuters
Aero
Demand for air travel has plummeted globally as the coronavirus
pandemic continues to spread. Airlines are still operating at a
reduced capacity, but they've grounded large portions of their fleets.
They are routinely sending up planes with just one or two
passengers, plus some cargo./ Business Insider
Without widespread testing for the coronavirus or a vaccine, airline
travel won’t be anywhere close to normal for months, or even years,
to come. The new reality will likely be fewer, more expensive flights
on slimmed-down airlines that have laid off thousands of employees
and cut ties to many contractors. In addition, travelers may be
required to have new documentation and health checks to board./
Politico
Oil & gas
Oil advanced for a second day on signs fuel consumption is starting
to recover in the world’s biggest economies, while global production
cuts also begin to offset the demand destruction caused by the
coronavirus./ Bloomberg
Green energy
The coronavirus lockdown will cause the biggest drop in energy
demand in history, with only renewables managing to increase
output through the crisis./ Bloomberg
Gold
Gold market diverges with demand rising in West and falling in
East./ Bloomberg
AFTER HOURS
When doctors in hospitals around the world fight for the lives of
coronavirus-infected patients, street artists are carrying out their
projects. They are trying to convince people to stay at home,
criticizing politicians who do not always make the right decisions
on how to fight the epidemic and they are expressing their
admiration for medical services. Many of murals refer to famous
paintings, others just comment on reality. Street artists present
their works from London through Warsaw, Los Angeles and Tokyo/
Wyborcza.plCartoon from 1977 (sic!) and strikes a little too close to home in
2020! Brought to you by Dana Fradon/ The New Yorker Cartoons
About Eight International
Eight International is a global advisory organization founded in 2016 by six consultancies sharing the same values. A globally integrated team
of over 70 leaders and over 600 professionals seamlessly advises corporate clients, businesses, private equity funds and leading investment
banks to help navigate challenges across transactions, restructuring and operational transformation. Eight International brings innovative
solutions in a broad array of industries through its three key pillars: Reactivity via its nimble business model, Quality of its experienced
practitioners and Independence, given no conflicts of interest.
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