A daily update of major developments in respect of the evolving Covid-19 coronavirus crisis and its global implications – with particular respect to national government developments, forecasts and commentaries.
• US COVID-19 cases are accelerating and will soon surpass China’s on current trends. Even more worryingly, a US jobless numbers report shows a record weekly rise in the numbers of Americans laid off and claiming benefits. The debate over the controversial Trump proposal to relax restrictions and ‘re-open the country’ from Easter continues. • G20 leaders have held an extraordinary meeting via video conference to respond to the global pandemic and agreed on the need for collective action to boost the global economy. • China has suspended entry for most foreigners – it blames ‘imported’ infections from travellers for its latest confirmed cases. • India has announced an economic stimulus package worth 1.7 trillion rupees ($22.5 billion). • Vietnam has become the latest country to ban large public gatherings, while Hungary has joined the ever-expanding lockdown club.
In the US, speculation continues over a controversial proposal from the President for a possible easing of restrictions to enable a widespread return to work from Easter Sunday, 12 April. Calls for a return to work and to get the economy moving again gathered some momentum after it emerged that an unprecedented 3.3 million Americans last week claimed benefits after being laid off because of the coronavirus. The previous week’s total was 282,000. The 3.3 million figure soared past the previous record – 695,000 – set in 1982.
G20 leaders have held an extraordinary meeting via video conference to respond to the global pandemic. In a statement, they committed to collective action and to continue to “conduct bold and large-scale fiscal support”. The G20 statement also said that it will “ask Finance Ministers and Central Bank Governors to coordinate on a regular basis to develop a G20 action plan in response to COVID-19 and work closely with international organisations to swiftly deliver the appropriate international financial assistance.”
UK Prime Minister Boris Johnson has revealed he has tested positive for Covid-19. “Over the last 24 hours I have developed mild symptoms and tested positive for coronavirus,” he tweeted. “I am now self-isolating, but I will continue to lead the government’s response via video-conference as we fight this virus.”
Over the last 24 hours I have developed mild symptoms and tested positive for coronavirus.
I am now self-isolating, but I will continue to lead the government’s response via video-conference as we fight this virus.
— Boris Johnson #StayHomeSaveLives (@BorisJohnson) March 27, 2020
China has suspended entry for most foreigners. From Saturday, foreign nationals holding valid visas or residence permits for China will not be allowed to enter the country, China’s Ministry of Foreign Affairs has said in a statement. The only exceptions will be foreign nationals coming to China for “necessary economic, trade, scientific or technological activities or out of emergency humanitarian needs”. They can still apply for visas. Beijing is blaming new confirmed COVID-19 cases on travellers returning from overseas, rather than domestically sourced transmission.
The ban on outbound civilian traffic from Hubei province, with the exception of that from Wuhan, the provincial capital, was lifted this week, after a two month lockdown. The ban on that from Wuhan is due to be lifted on April 8.
India has announced an economic stimulus package worth 1.7 trillion rupees ($22.5bn). The package includes food security measures – rice and pulses – for poor households (some 800 million people) as well as direct cash transfers. The country is also in the midst of a 21-day lockdown.
Hungary has announced a two-week lockdown in response to the coronavirus. Prime Minister Viktor Orban said that while citizens must maintain social distancing, they would be able to go to work, shop and take limited exercise outdoors, starting Saturday.
Vietnam bans large public gatherings. Vietnam has become the latest country to ban large public gatherings. The government has announced that indoor gatherings of more than 20 people and outdoor gatherings of 10 people or more would be banned. Contact tracing has figured prominently in Vietnam’s efforts to counter COVID-19. “The important thing is, you need to know the number of people who might have come in contact with the disease, or returned from pandemic areas, then perform tests on these people,” one senior official advising Vietnam’s Emergency Operation Centre told The Financial Times.
Malaysia has announced a package of stimulus worth MYR250bn ($57.9bn) to soften the economic impact from the coronavirus outbreak. Some 128 billion ringgit ($29.6 billion) will be spent on social welfare and 100 billion ringgit ($23.1 billion) will be deployed to support businesses, the Malaysian prime minister said in a televised address.
Thailand has decreed a state of emergency following a sharp rise in Covid-19 cases. It has also banned the entry of non-resident foreigners and is planning a fiscal stimulus to offset the economic impact of the growing crisis. The country has been hit particularly hard by much-reduced tourism numbers.
Kenya enforces Covid-19 curfew. Kenyan President Uhuru Kenyatta announced the curfew earlier this week. It will restrict the movement of citizens between 7:00 pm and 5:00 am the following day.
Commentators, forecasters and financial institutions
• The number of Covid-19 cases has surpassed 450,000 globally, according to the WHO. • A JP Morgan Asset Management strategist has warned that the spike in jobless claims in America (to a record 3.3 million in a single week) is a sign that economic damage from the coronavirus outbreak is going to be around for a while. • The investment bank has also revised down its US GDP projections and now expects Q2 to show a quite staggering 25% annualised reversal. • A survey of businesses prompts a question: When this crisis is over, will we be avoiding travel and working more at home permanently?
The number of Covid-19 cases has surpassed 450,000 globally, according to the WHO. There are some 462,684 confirmed cases (49,219 last 24 hours) and 20,834 deaths (2,401 last 24 hours). International proliferation continues with three new countries/territories/areas from the Americas (1) and Africa (2) reporting cases of COVID-19. China continues to show a low number of new cases and deaths. Total cases for China stand at 81,961 (113 last 24 hours) with deaths at 3,293 (just 6 in last 24 hours). The US is showing an acceleration, with 63,570 cases (11,656 in last 24 hours) and 884 deaths (211 last 24 hours).
A JP Morgan Asset Management strategist has warned that the spike in jobless claims in the US (to a record 3.3 million in a single week) is a sign that economic damage from the coronavirus outbreak is going to be around for a while. “It’s a bit of a shock to look at just the chart of how many people are claiming unemployment, compared to what we’ve seen in prior periods of economic stress,” Hannah Anderson, a global market strategist, told CNBC. She added: “I think we should all take this as a serious signal that we’re going to have to deal with economic pain for quite a while longer.”
JP Morgan has also slashed its growth outlook for the US economy for the first and second quarters. The investment bank cut its forecast for real annualised GDP in the first quarter to a 10% contraction (previously -4%). It now expects a contraction of 25% in Q2 (previously at -14%).
Goldman Sachs and Morgan Stanley said on Friday they had received the final regulatory approvals to take majority stakes in their China securities joint ventures, as Beijing continues to open its financial sector to foreigners. With the Chinese economy where it is, the FDI doors are likely to be held well and truly open and the liberalisation of financial markets will continue.
A Forbes commentator neatly distils the US political and economic debate thrown into sharp relief by the Covid-19 crisis: China’s 4% GDP Plunge Is Trump’s Nightmare. China’s mounting troubles in 2020, he notes, should remind Donald Trump to be careful about what he wishes for. ‘His two-year-long trade war weakened China’s economic immune system and its ability to withstand the fallout from a pandemic virtually no one saw coming’.
A survey by S&P suggests that the Covid-19 crisis will likely have a permanent impact on modes of working. Enterprises surveyed said they are implementing travel bans, work-from-home policies and limits on internal and external meetings. Many expect these policies to remain in place long-term or permanently, including 38% for expanded/universal work from home policies, 23% for travel limitations or bans, and 16% for not attending events they have previously attended.
Sources: Coronavirus disease (COVID-2019) situation reports; JP Morgan; S&P Global; Forbes