Shenzhen, China – For Eppu Makipaa, some quick thinking in late January as a new coronavirus swept through China and many other countries helped avert a significant disruption at the company he works for.
Makipaa – a sales engineer and manager at Lifa Air International, a Finnish company that makes air purifiers and protective masks in a factory with 3,000 workers in Dongguan in southern China – opted to keep manufacturing operations going even as most Chinese companies shut down for the Lunar New Year holiday that started on January 25.
“We decided to keep our factory open a little bit longer because we had some new product launch events going on,” Makipaa told Al Jazeera. “We saw the situation with the virus and decided that we would [only] close the factory for less than 24 hours [for the holiday].”
This was a challenge, as most of the workers wanted to return to their hometowns and villages for the holiday. But for the staff who stayed, doing so proved to be a blessing.
“We were able to find enough workers who were willing to work, and, of course, a lot of those people were from areas that are now affected by a virus,” Makipaa said.
He says his workers find it “important and meaningful” that they are able to help the fight against the virus by supplying medical equipment for those who need it the most.
But for many other firms in China, the coronavirus outbreak has been far more painful. And while the broader economic effect on China is still hard to gauge and likely yet to fully play out, some economists are already warning the public to brace for a sharp slowdown.
The number of infections has now exceeded those during the Severe Acute Respiratory Syndrome (SARS) epidemic of 2002-2003 with the number of deaths climbing rapidly.
The latest outbreak brought the country to a standstill in the middle of the Chinese New Year holiday which was originally scheduled to last from January 24 to 30.
But central government authorities officially extended the holiday nationally through to February 2. Key economic powerhouses like Guangdong province in southern China have indicated that key sectors such as municipal utilities, public transport, medical supply producers, supermarkets, food production, and logistics should resume work first, with all others allowed to start after February 9.
‘A huge challenge’
Thousands of flights, trains, and long-distance buses have been cancelled or disrupted while road traffic has become snarled by checkpoints for body temperature scans and by villagers blocking roads to keep outsiders away.
One of the many roadblocks in villages around Yangshuo, a town in southern China’s Guangxi province. People in the area are trying to prevent outsiders from entering their region [Amantin Baruti via Michael Standaert/Al Jazeera]
Millions of Chinese, many back in their rural hometowns for the holiday, have been staying indoors much of the time for fear of catching the virus or by order in over a dozen cities locked down in Hubei province, where the outbreak originated in the provincial capital of Wuhan in late December.
Wuhan is a key transport, steel and industrial hub between all four points on the compass for China, often compared with Chicago in the United States due to its geographic importance.
In the coming days, many of those millions home for the holidays will attempt to return to major cities where they work. They will try to travel by air, rail and highway, potentially creating a transport logjam worse than the usual travel problems at this time of year.
Once at their destination, they will need to navigate roadblocks, quarantined residences and offices, temperature scans at supermarkets and on the metro and enforced mask usage. And with mask supplies stretched, that could be difficult.
Many business owners say their most pressing concern right now is ensuring the health of their workers as they return from the Spring Festival if they can.
“It will be a huge challenge,” Everest Zhao, CEO of electronic cigarette company VooPoo, said of the possible labour shortages ahead.
“Right now we’re more concerned with helping the country through this and how to keep our colleagues safe,” Zhao told Al Jazeera.
China had already been experiencing its slowest economic growth rates in nearly 30 years before the coronavirus outbreak, as the United States engaged it in a trade war. Gross domestic product (GDP) – the total value of all finished goods and services produced in a country – expanded by 6 percent in the fourth quarter of last year compared with the same period in 2018.
Zhang Ming, an economist at the Chinese Academy of Social Sciences – a top government think-tank – estimates that the outbreak could cut first-quarter 2020 GDP growth by about 1 percentage point.
“GDP growth in the first quarter of 2020 could be about 5.0 percent, and we cannot rule out the possibility of falling below 5.0 percent,” Zhang was quoted as saying in Caijing magazine.
‘Freaking out’
With infection rates continuing to rise, the big unknown remains precisely how long and severe the coronavirus outbreak will be.
Some analysts say fear is likely to cause the greatest impact on China’s economy, rather than actual infections or deaths [Amantin Baruti via Michael Standaert/Al Jazeera]
“The economic effect of this Wuhan coronavirus will depend on how long the outbreak lasts and its impacts, such as deaths and disabilities that result from it,” Yun Jiang, co-editor of the China Neican policy newsletter who formerly worked in the Australian government. “As the infection number is still rising, it appears unlikely that the outbreak will stop any time soon.”
Jiang told Al Jazeera that the most immediate impacts will be on tourism, retail and airlines already hurt in China and increasingly around the world as carriers halt flights to the country.
“This [crisis] will make China reaching its GDP target of around 6 percent in 2020 more challenging,” Jiang said. “On the other hand, it may provide the Chinese Government with a quite reasonable excuse to miss its target.”
Chinese authorities are rolling out measures to help the worst-affected areas of the economy.
For instance, The People’s Bank of China (PBOC), the central bank, is urging commercial lenders to ease credit terms for companies finding it hard to meet their debt obligations.
“During the period of epidemic control, key enterprises that produce, transport and sell important medical supplies and daily necessities should be put on a list, and the PBC will provide them with credit support at favorable rates,” the central bank said in a statement on Monday.
But it is not clear whether such measures will be enough. Analysts say much of the economic damage could be caused by panic over the potential effect of the virus, rather than actual deaths or infections of people.
“Our clients are freaking out,” Dan Harris, partner at US law firm Harris Bricken, told Al Jazeera. “The big fear is that people will not be going back to work.”
But psychology aside, logistical challenges due to measures to contain the spread of the virus are causing very real headaches for manufacturers and the broader economy.
School start times could be another factor in key areas like Guangdong where the start is expected to be pushed back from February 17. The longer children have to stay at home, the longer the disruptions for families trying to figure out how to navigate their return to the cities, factories and offices where they work.
“The teachers put on unpaid leave are starting to realise that there is no end in sight and they too are freaking out because many of them don’t have enough money to fly out or to pay their rent, and their employers are going radio silent,” Harris said.
Financial markets reopened on Monday for the first time since the Lunar New Year holidays and for anyone invested in stocks or commodities, it was probably a day to forget.
Mainland China’s Shanghai Composite Index of leading stocks fell by 7.9 percent, its biggest one-day drop since 2015. The sell-off had been expected, as markets elsewhere had already reacted to the rapidly spreading virus. But still, economists say it reflects the economic pain that could lie ahead.
Massive impact
“I think the impact could be massive,” said Francesco Sisci, an Italian Sinologist who has been in Beijing since the late 1980s and who witnessed the SARS outbreak of 2003.
Efforts to revive China’s economy after the viral outbreak is dealt with could give growth and productivity a big boost, but until then, the country is likely to face a sharp slowdown, analysts say [File: Thomas Peter/Reuters]
“There was a boost in productivity once SARS was dealt with, but I think this time is different,” Sisci told Al Jazeera by phone.
China’s already-slowing economy and its continuing trade war with the US leave the country vulnerable to a protracted economic crisis, Sisci said.
“Whether the Chinese financial institutions have enough firepower to support the market, that is the most immediate challenge and that will impact the economy,” he said. “I would say that is what we have to pay attention to.”
On Monday, the PBOC tried to ease the panic selling by injecting 1.2 trillion yuan ($171bn) into the market. But it is not clear whether this will be enough to support the broader economy in the coming weeks and months.
Sisci also says a political crisis could be forthcoming regarding the upcoming National People’s Congress (NPC) meetings which start each year on March 5, where officials from across the country converge in Beijing to craft policy for the coming year.
The 2020 meetings are particularly important as leaders will chart the path forward for the next five-year economic and development plans with the 14th Five-Year Plan set to start from 2021.
Looking back to 2003, Sisci says that year’s NPC meetings helped accelerate the spread of the SARS virus.
“That was the occasion when SARS spread to Beijing, because all the [provincial] delegations go to Beijing,” Sisci said. “So in a sense, they have to deal with this outbreak by the end of February.”
Additional research assistance provided by Zhong Yunfan.
Almost seven years since news broke of an alleged conspiracy to fix the price of packaged bread across Canada, the saga isn’t over: the Competition Bureau continues to investigate the companies that may have been involved, and two class-action lawsuits continue to work their way through the courts.
Here’s a timeline of key events in the bread price-fixing case.
Oct. 31, 2017: The Competition Bureau says it’s investigating allegations of bread price-fixing and that it was granted search warrants in the case. Several grocers confirm they are co-operating in the probe.
Dec. 19, 2017: Loblaw and George Weston say they participated in an “industry-wide price-fixing arrangement” to raise the price of packaged bread. The companies say they have been co-operating in the Competition Bureau’s investigation since March 2015, when they self-reported to the bureau upon discovering anti-competitive behaviour, and are receiving immunity from prosecution. They announce they are offering $25 gift cards to customers amid the ongoing investigation into alleged bread price-fixing.
Jan. 31, 2018: In court documents, the Competition Bureau says at least $1.50 was added to the price of a loaf of bread between about 2001 and 2016.
Dec. 20, 2019: A class-action lawsuit in a Quebec court against multiple grocers and food companies is certified against a number of companies allegedly involved in bread price-fixing, including Loblaw, George Weston, Metro, Sobeys, Walmart Canada, Canada Bread and Giant Tiger (which have all denied involvement, except for Loblaw and George Weston, which later settled with the plaintiffs).
Dec. 31, 2021: A class-action lawsuit in an Ontario court covering all Canadian residents except those in Quebec who bought packaged bread from a company named in the suit is certified against roughly the same group of companies.
June 21, 2023: Bakery giant Canada Bread Co. is fined $50 million after pleading guilty to four counts of price-fixing under the Competition Act as part of the Competition Bureau’s ongoing investigation.
Oct. 25 2023: Canada Bread files a statement of defence in the Ontario class action denying participating in the alleged conspiracy and saying any anti-competitive behaviour it participated in was at the direction and to the benefit of its then-majority owner Maple Leaf Foods, which is not a defendant in the case (neither is its current owner Grupo Bimbo). Maple Leaf calls Canada Bread’s accusations “baseless.”
Dec. 20, 2023: Metro files new documents in the Ontario class action accusing Loblaw and its parent company George Weston of conspiring to implicate it in the alleged scheme, denying involvement. Sobeys has made a similar claim. The two companies deny the allegations.
July 25, 2024: Loblaw and George Weston say they agreed to pay a combined $500 million to settle both the Ontario and Quebec class-action lawsuits. Loblaw’s share of the settlement includes a $96-million credit for the gift cards it gave out years earlier.
Sept. 12, 2024: Canada Bread files new documents in Ontario court as part of the class action, claiming Maple Leaf used it as a “shield” to avoid liability in the alleged scheme. Maple Leaf was a majority shareholder of Canada Bread until 2014, and the company claims it’s liable for any price-fixing activity. Maple Leaf refutes the claims.
This report by The Canadian Press was first published Sept. 19, 2024.
Companies in this story: (TSX:L, TSX:MFI, TSX:MRU, TSX:EMP.A, TSX:WN)
TORONTO – Canada’s main stock index was up more than 250 points in late-morning trading, led by strength in the base metal and technology sectors, while U.S. stock markets also charged higher.
The S&P/TSX composite index was up 254.62 points at 23,847.22.
In New York, the Dow Jones industrial average was up 432.77 points at 41,935.87. The S&P 500 index was up 96.38 points at 5,714.64, while the Nasdaq composite was up 486.12 points at 18,059.42.
The Canadian dollar traded for 73.68 cents US compared with 73.58 cents US on Thursday.
The November crude oil contract was up 89 cents at US$70.77 per barrel and the October natural gas contract was down a penny at US2.27 per mmBTU.
The December gold contract was up US$9.40 at US$2,608.00 an ounce and the December copper contract was up four cents at US$4.33 a pound.
This report by The Canadian Press was first published Sept. 19, 2024.
VANCOUVER – Supervised injection sites are saving the lives of drug users everyday, but the same support is not being offered to people who inhale illicit drugs, the head of the BC Centre for Excellence in HIV/AIDS says.
Dr. Julio Montaner said the construction of Vancouver’s first indoor supervised site for people who inhale drugs comes as the percentage of people who die from smoking drugs continues to climb.
The location in the Downtown Eastside at the Hope to Health Research and Innovation Centre was unveiled Wednesday after construction was complete, and Montaner said people could start using the specialized rooms in a matter of weeks after final approvals from the city and federal government.
“If we don’t create mechanisms for these individuals to be able to use safely and engage with the medical system, and generate points of entry into the medical system, we will never be able to solve the problem,” he said.
“Now, I’m not here to tell you that we will fix it tomorrow, but denying it or ignoring it, or throw it under the bus, or under the carpet is no way to fix it, so we need to take proactive action.”
Nearly two-thirds of overdose deaths in British Columbia in 2023 came after smoking illicit drugs, yet only 40 per cent of supervised consumption sites in the province offer a safe place to smoke, often outdoors, in a tent.
The centre has been running a supervised injection site for years which sees more than a thousand people monthly and last month resuscitated five people who were overdosing.
The new facilities offer indoor, individual, negative-pressure rooms that allow fresh air to circulate and can clear out smoke in 30 to 60 seconds while users are monitored by trained nurses.
Advocates calling for more supervised inhalation sites have previously said the rules for setting up sites are overly complicated at a time when the province is facing an overdose crisis.
More than 15,000 people have died of overdoses since the public health emergency was declared in B.C. in April 2016.
Kate Salters, a senior researcher at the centre, said they worked with mechanical and chemical engineers to make sure the site is up to code and abidies by the highest standard of occupational health and safety.
“This is just another tool in our tool box to make sure that we’re offering life-saving services to those who are using drugs,” she said.
Montaner acknowledged the process to get the site up and running took “an inordinate amount of time,” but said the centre worked hard to follow all regulations.
“We feel that doing this right, with appropriate scientific background, in a medically supervised environment, etc, etc, allows us to derive the data that ultimately will be sufficiently convincing for not just our leaders, but also the leaders across the country and across the world, to embrace the strategies that we are trying to develop.” he said.
Montaner said building the facility was possible thanks to a single $4-million donation from a longtime supporter.
Construction finished with less than a week before the launch of the next provincial election campaign and within a year of the next federal election.
Montaner said he is concerned about “some of the things that have been said publicly by some of the political leaders in the province and in the country.”
“We want to bring awareness to the people that this is a serious undertaking. This is a very massive investment, and we need to protect it for the benefit of people who are unfortunately drug dependent.” he said.
This report by The Canadian Press was first published Sept. 18, 2024.
