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As COVID-19 restrictions are lifted, Sask. economy could serve as 'test case' for rest of country – CTV News Saskatoon

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SASKATOON —
Saskatchewan’s economy could return to “normal” by the end of 2020, according to the Dean of the University of Saskatchewan’s Edwards School of Business Keith Willoughby. 

But that, he says, will depend heavily on what unfolds following May 4 and May 19; the start dates for phases one and two of the province’s Re-Open Saskatchewan Plan.

“[If] the incident rate remains low and the impact continues to be relatively stabilized as we’ve seen it here in Saskatchewan, I’d be thinking later on this calendar year, towards the fall, we could start seeing much more in terms of the normal that we enjoy,” he said.

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Willoughby believes the lower population density of Saskatchewan, combined with fewer cases of COVID-19, have made the province “a real test case for the rest of the country” when it comes to loosening restrictions surrounding the virus and seeing how the economy responds.

“As you see the restrictions [loosen], and then when you combine that with consumer confidence, I think those will be the bellwether signals for us as an economy in this province and country,” he said.

But Willoughby admits, it’s difficult to predict how the economy will respond coming out of the COVID-19 pandemic.

“It’s hard to look back and see where we could draw a line of reference,” he said. “It’s wider than say SARS in 2003, it’s different in terms of the 9/11 impact in the early part of the 21st century, it’s different from the 2008 housing meltdown and things that happened there.”

“Mike Tyson the boxer says ‘Everybody has a plan until they get punched in the mouth.’ and if you think of all of the plans that we’ve had, this is an atypical series of events,” he said. 

“It will definitely now create that impact on that scenario by which governments can test their policies and make decisions that they feel are for the best interest of their citizens.”

Willoughby believes the effects of the COVID-19 pandemic on the economy could be felt for years to come, and may affect Canadians through taxes.

“The governments, provincially and federally, have done a lot of work trying to restore confidence through different support programs, obviously that’s going to add to our debt load,” he said. “There will have to be decisions made as far as how that debt is going to be carried. Somebody’s going to have to pay for this.”

Those aren’t the only big decisions looming for the provincial and federal governments, Willoughby says, in the process of getting the economy back on track.

“The balance between public safety and economic viability,” said Willoughby, could prove to be a challenge. 

“Weigh it too heavily on public safety, you’re going to curtail economic viability, and there are hundreds, thousands lives and jobs that are going to be impacted. On the other hand, there are people that say if you don’t address public safety, then this thing gets rampant, and people die.”

Board chair of the Saskatoon Chamber of Commerce Chris Sicotte believes that Saskatchewan businesses can rebound from COVID-19.

“I really do think that Saskatchewan people, Saskatchewan citizens, we’re the type that are going to be able to recover from this,” he said, adding that it will be the responsibility of consumers to make sure local businesses are able to profit coming out of the pandemic.

“We need to make sure that, as consumers, that we’re also supporting those businesses as well, locally, so that once those restrictions are lifted we’re continuing to utilizethe services of those merchants, of those businesses, of those agencies locally. Because that’s the only way that everybody’s going to be able to survive through this.”

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Economy

China Wants Everyone to Trade In Their Old Cars, Fridges to Help Save Its Economy

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China’s world-beating electric vehicle industry, at the heart of growing trade tensions with the US and Europe, is set to receive a big boost from the government’s latest effort to accelerate growth.

That’s one takeaway from what Beijing has revealed about its plan for incentives that will encourage Chinese businesses and households to adopt cleaner technologies. It’s widely expected to be one of this year’s main stimulus programs, though question-marks remain — including how much the government will spend.

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Economy

German Business Outlook Hits One-Year High as Economy Heals

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German business sentiment improved to its highest level in a year — reinforcing recent signs that Europe’s largest economy is exiting two years of struggles.

An expectations gauge by the Ifo institute rose to 89.9. in April from a revised 87.7 the previous month. That exceeds the 88.9 median forecast in a Bloomberg survey. A measure of current conditions also advanced.

“Sentiment has improved at companies in Germany,” Ifo President Clemens Fuest said. “Companies were more satisfied with their current business. Their expectations also brightened. The economy is stabilizing, especially thanks to service providers.”

A stronger global economy and the prospect of looser monetary policy in the euro zone are helping drag Germany out of the malaise that set in following Russia’s attack on Ukraine. European Central Bank President Christine Lagarde said last week that the country may have “turned the corner,” while Chancellor Olaf Scholz has also expressed optimism, citing record employment and retreating inflation.

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There’s been a particular shift in the data in recent weeks, with the Bundesbank now estimating that output rose in the first quarter, having only a month ago foreseen a contraction that would have ushered in a first recession since the pandemic.

Even so, the start of the year “didn’t go great,” according to Fuest.

“What we’re seeing at the moment confirms the forecasts, which are saying that growth will be weak in Germany, but at least it won’t be negative,” he told Bloomberg Television. “So this is the stabilization we expected. It’s not a complete recovery. But at least it’s a start.”

Monthly purchasing managers’ surveys for April brought more cheer this week as Germany returned to expansion for the first time since June 2023. Weak spots remain, however — notably in industry, which is still mired in a slump that’s being offset by a surge in services activity.

“We see an improving worldwide economy,” Fuest said. “But this doesn’t seem to reach German manufacturing, which is puzzling in a way.”

Germany, which was the only Group of Seven economy to shrink last year and has been weighing on the wider region, helped private-sector output in the 20-nation euro area strengthen this month, S&P Global said.

–With assistance from Joel Rinneby, Kristian Siedenburg and Francine Lacqua.

(Updates with more comments from Fuest starting in sixth paragraph.)

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Economy

Parallel economy: How Russia is defying the West’s boycott

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When Moscow resident Zoya, 62, was planning a trip to Italy to visit her daughter last August, she saw the perfect opportunity to buy the Apple Watch she had long dreamed of owning.

Officially, Apple does not sell its products in Russia.

The California-based tech giant was one of the first companies to announce it would exit the country in response to Russian President Vladimir Putin’s full-scale invasion of Ukraine on February 24, 2022.

But the week before her trip, Zoya made a surprise discovery while browsing Yandex.Market, one of several Russian answers to Amazon, where she regularly shops.

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Not only was the Apple Watch available for sale on the website, it was cheaper than in Italy.

Zoya bought the watch without a moment’s delay.

The serial code on the watch that was delivered to her home confirmed that it was manufactured by Apple in 2022 and intended for sale in the United States.

“In the store, they explained to me that these are genuine Apple products entering Russia through parallel imports,” Zoya, who asked to be only referred to by her first name, told Al Jazeera.

“I thought it was much easier to buy online than searching for a store in an unfamiliar country.”

Nearly 1,400 companies, including many of the most internationally recognisable brands, have since February 2022 announced that they would cease or dial back their operations in Russia in protest of Moscow’s military aggression against Ukraine.

But two years after the invasion, many of these companies’ products are still widely sold in Russia, in many cases in violation of Western-led sanctions, a months-long investigation by Al Jazeera has found.

Aided by the Russian government’s legalisation of parallel imports, Russian businesses have established a network of alternative supply chains to import restricted goods through third countries.

The companies that make the products have been either unwilling or unable to clamp down on these unofficial distribution networks.

 

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