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Four weeks of war scar Russia's economy – Reuters

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Russian Rouble coin is seen on a broken glass and displayed on the Russian flag in this illustration taken, February 24, 2022. REUTERS/Dado Ruvic/Illustration/File Photo

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LONDON, March 24 (Reuters) – Russia’s invasion of Ukraine on Feb. 24 sparked sweeping sanctions that ripped the country out of the global financial fabric and sent its economy reeling.

A month on, Russia’s currency has lost a large part of its value and its bonds and stocks have been ejected from indexes. Its people are experiencing economic pain that is likely to last for years to come.

Below are five charts showing how the past month has changed Russia’s economy and its global standing:

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ECONOMIC PAIN

In 2020, Russia was the world’s 11th-largest economy, according to the World Bank. But by the end of this year, it may rank no higher than No. 15, based on the end-February rouble exchange rate, according to Jim O’Neill, the former Goldman Sachs economist who coined the BRIC acronym to describe the four big emerging economies Brazil, Russia, India and China.

Recession looks inevitable. Economists polled by the central bank predicted an 8% contraction this year and for inflation to reach 20%. read more

Forecasts from economists outside Russia are even gloomier. The Institute of International Finance predicts a 15% contraction in 2022, followed by a 3% contraction in 2023.

“Altogether, our projections mean that current developments are set to wipe out the economic gains of roughly fifteen years,” the IIF said in a note.

IIF on Russia GDP
IIF on Russia GDP

INFLATION BUSTING TURNS TO DUST

Since taking office in 2013, central bank governor Elvira Nabiullina’s biggest triumph was curbing inflation from 17% in 2015 to just above 2% in early-2018. As price pressures rose in the post-pandemic months, she defied industrialists by raising interest rates eight months straight.

Nabiullina also resisted calls in 2014-2015 for capital controls to stem outflows following the annexation of Crimea.

But those achievements have been torn to shreds in less than a month.

Annual price growth has accelerated to 14.5% and should surpass 20%, five times the target. Households’ inflation expectations for the year ahead are above 18%, an 11-year high.

While panic-buying accounts for some of this, rouble weakness may keep price pressures elevated read more .

With Russia’s reserves warchest frozen overseas, Nabiullina was forced to more than double interest rates on Feb. 28 and introduce capital controls. The central bank now expects inflation back at target only in 2024.

Russia inflation
Russia inflation

INDEX ELIMINATION

Sanctions are forcing index providers to eject Russia from benchmarks used by investors to funnel billions of dollars into emerging markets.

JPMorgan (.JPMEGDR) and MSCI are among those that have announced they are removing Russia from their bond and stock indexes respectively (.MSCIEF).

Russia’s standing in these indexes had already taken a hit following the first set of Western sanctions in 2014 and then in 2018, following the poisoning of a former Russian spy in Britain and investigations into alleged Russian meddling in the 2016 U.S. elections.

On March 31, Russia’s weighting will be dialled to zero by nearly all major index providers.

Russia's weighting in JPMorgan bond indexes Russia's weighting in JPMorgan bond indexes
Reuters Graphics Reuters Graphics

RATINGS RUPTURE

When Russian troops stormed into Ukraine, their country had a coveted “investment grade” credit rating with the three major agencies S&P Global, Moody’s and Fitch.

That allowed it to borrow relatively cheaply and a sovereign debt default appeared a distant prospect.

In the past four weeks, Russia has suffered the largest cuts ever made to a sovereign credit score. It is now at the bottom of the ratings ladder, flagging an imminent risk of default.

Russia's credit rating sees largest cut ever seen globally
Russia’s credit rating sees largest cut ever seen globally

ROUBLE TROUBLE

A month ago, the rouble’s one-year average exchange rate sat at 74 per dollar. Trading on different platforms showed the ample liquidity and tight bid/ask spreads expected for a major emerging market currency.

All that has changed. With the central bank bereft of a large portion of it hard currency reserves, the rouble plunged to record lows of more than 120 per dollar locally. In offshore trade it fell as low as 160 to the greenback.

As liquidity dried up and bid/ask spreads widened, pricing the rouble has become haphazard. The exchange rate is yet to find a balance on- and offshore.

Pricing the rouble amid a liquidity crunch
Reuters Graphics
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Reporting by Karin Strohecker, Sujata Rao, Rodrigo Campos and Marc Jones; Editing by Sam Holmes

Our Standards: The Thomson Reuters Trust Principles.

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Concordia invests $2M in the Circular Economy Fund – Concordia University News

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The Concordia University Foundation and the Greater Montreal Climate Fund (GMCF) are investing $2 million and $500,000, respectively, in the Circular Economy Fund (CE Fund).

The commitments total more than $18M, bringing the EC Fund closer to its objective of $25M, to which Fondaction is also adding $5M in co-investment.

Unique in Canada, the EC Fund was launched in March 2021 by Fondaction, in partnership with the City of Montreal and RECYC-QUÉBEC. The fund aims to accelerate ecological transition through the circular economy, notably by reducing the production of residual materials and supporting their recovery, in addition to reducing greenhouse gas emissions.

It encourages innovation and the exchange of solutions between startups and the largest Quebec companies.

Partnerships anchored in the mission of the Circular Economy Fund

Marc Gauthier, treasurer and chief investment officer of Concordia, says this investment with the GMCF and Fondaction in the Circular Economy Fund represents a second important co-investment for the sustainable innovation sector.

“Earlier this year, we joined Fondaction in the Urapi Sustainable Soil Management Fund. It is with great pleasure that the Concordia University Foundation is now co-investing in the Circular Economy Fund,” he says.

“Like Urapi, this Fund is perfectly aligned with our goals for sustainable investments and investments with social and environmental impact.”

Marie-Claude Bourgie, executive director of the GMCF, says investing in the Circular Economy Fund allows the Greater Montreal Climate Fund to carry out a mission that is close to its heart: to accelerate the implementation of climate solutions in the metropolitan region.

“It is by supporting entrepreneurs dedicated to meeting the challenge of putting raw materials back into circulation that we can rethink the production chain and thus reduce our greenhouse gas emissions.”

With this second closing, Fondaction will be able to help more companies that want to optimize the use and recovery of resources as well as the reduction of residual materials and greenhouse gas emissions, explains Marc-André Binette, assistant chief investment officer at the investment fund.

“We are pleased to have wise financial partners who have made the circular economy a major pillar in the fight against climate change,” he adds.

Getting involved in the city’s ecological transition

Since the EC Fund was deployed, four companies (Still Good, Groupe Onym, Ferme Tournevent and CarbiCrete) have received an investment from the Fund to increase their production, open a new plant, increase research and development and test an innovative product.

These companies operate in different sectors, such as agri-food, recycling, resource recovery and eco-construction, but their missions are all part of the circular economy concept.

According to the Pôle québécois de concertation sur l’économie circulaire, this economy is closely linked to practices that optimize the use of natural resources in order to reduce the environmental footprint and contribute to the well-being of the population.

By creating the EC Fund, Fondaction and its partners are investing for the future and these two new investors open up new investment opportunities for the EC Fund and fuel the development of responsible and sustainable innovations.


Find out more about the
Circular Economy Fund (CE Fund).

 

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Oakville's economy 'remains strong,' says Economic Development Report | inHalton – insauga.com

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Published May 26, 2022 at 4:58 pm

The growth of Oakville companies like Geotab were highlighted in the Town of Oakville’s 2021 Economic Development Report. FACEBOOK PHOTO

The attraction of new companies like Amazon and growth at existing ones like Geotab resulted in some 1,000 new jobs, highlight the Town of Oakville’s 2021 Economic Development Report.

Released at the Town Council meeting on Wednesday night, the annual report provides an overview of the town’s economic activity in 2021, highlighting local economic growth, recovery, and resiliency.

“Oakville’s economy remains strong because our livability and our pandemic recovery plan continues to attract new investments that are essential to supporting the pandemic recovery, job creation, and the long-term health of our local economy,” said Oakville Mayor Rob Burton.

“The town remains committed to helping local businesses recover from the pandemic and remain resilient because together, we can help ensure business and people continue to thrive in our community.”

Some key highlights from the report include:

  • Oakville welcomed several new companies across various industries, including Wiseacre Studios, Amazon and NVA Canada, and saw growth at existing companies, including Geotab, Terrestrial Energy, and SteriMax, resulting in approximately 1,000 new jobs.
  • When compared to 17 surrounding municipalities Oakville’s commercial market remains highly competitive, ranking within the top five in the cost comparison for taxes and development charges.
  • Oakville’s industrial market is comparatively less competitive in the areas of land sale values and taxes, ranking more costly than half of the municipalities reviewed. Cost competitiveness for industrial development charges has improved, and industrial market demand overall remains high.
  • The Town’s Economic Development department continued to focus efforts on supporting pandemic recovery through its participation on the Recovery and Resiliency Committee, patio program, workplace self-screening rapid antigen testing program, and Digital Main Street.
  • In an effort to address the rise in office vacancy rates in Oakville, which reached a peak at 20.7 per cent in the third quarter of last year, the town developed the Where Living Works campaign, which promoted Oakville’s livability as a key differentiator for investment. While office vacancy rates rose across Ontario last year, the market remains optimistic with numbers declining in the fourth quarter. Many companies have also reintroduced return to office plans, with a focus on the hybrid work model.
  • For the third year in a row, Site Selection Magazine, an international business publication covering corporate real estate and economic development, listed the Town of Oakville in the top 20 of Canada’s Best Locations to invest based on significant investment and facility expansions at existing companies as well as new company arrivals.

For more details, review the 2021 Economic Development Annual Report or visit the Invest Oakville website.


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Long COVID fuelling brain health crisis disrupting workforce, economy – Financial Post

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More than one million Canadians, or about five per cent of the Canadian labour force, could be affected

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The effects of long COVID — where symptoms of the COVID-19 virus persist beyond four weeks from initial infection — are disrupting our health, our labour force and our economy.

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An estimated 10 to 30 per cent of COVID-19 survivors are currently experiencing a range of long COVID symptoms, which means that more than one million Canadians, or about five per cent of the Canadian labour force, could be affected.

Though long COVID affects the entire body, many of the most persistent symptoms are linked to brain health. These symptoms include headaches, “brain fog,” chronic fatigue, impaired memory or concentration, anxiety, depression and insomnia. Such symptoms directly limit a person’s ability to work or be productive at their former, pre-pandemic levels. That has implications for the economy. Knowledge-based economies rely on optimal “brain capital” for economic prosperity, and so without brain health, we compromise our wealth.

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What’s more, long COVID is striking people in their prime working years. According to a survey conducted in May 2021 by Viral Neuro Exploration (VINEx), the COVID Long Haulers Support Group Canada and Neurological Health Charities Canada, nearly 60 per cent of the more than 1,000 long haulers polled are between the ages of 40 and 59. Their top symptoms include fatigue and “brain fog,” which have impacted their work. Nearly 70 per cent of long-haulers said they were forced to take a leave from their jobs and more than half had to reduce their hours. Over one quarter had to go on disability, but nearly 44 per cent were unable to access disability insurance.

Long COVID brain health symptoms have persisted, and so have its impacts. In a follow-up survey and report conducted this spring, more than 80 per cent of respondents said the virus has negatively or very negatively affected their brain health. More than 70 per cent had to take a leave from work, which in some cases stretched beyond a year. Still others had to leave the workforce altogether. Troublingly, more than 30 per cent of survey respondents felt they weren’t believed when initially describing their symptoms to a health-care professional.

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Women appear to be bearing the brunt of long COVID symptoms; more than 87 per cent of the survey respondents identify as female. This is consistent with other studies showing women are disproportionately affected by as much as a four-to-one ratio to men, impacting women’s labour participation rate and further aggravating gender inequalities.

The brain health crisis in Canada isn’t new. Even before COVID-19, one in three people were estimated to have been directly impacted by a disease, disorder or injury of the brain, with indirect costs to families, the workplace, economy and society. But the pandemic, which led to shutdowns that caused social isolation and anxiety about an uncertain future, along with the virus itself and its lasting effects on long-haulers, only increased the prevalence of neurological and psychiatric disorders, putting additional stress on overall brain health.

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We are now facing a global mental health crisis. In the United States, “an overwhelming majority of Americans believe the U.S. is in the grips of a full-blown mental health crisis,” according to a USA Today/Suffolk University poll. President Joe Biden also announced a strategy to address national mental health issues as part of his first state of the union address. In Canada, the federal government created a cabinet position dedicated to mental health. The minister of mental health and addiction has a mandate to create a comprehensive, evidence-based plan “to address the crisis in mental health,” and establish a Canada Mental Health Transfer to help expand the delivery of mental health services, including for prevention and treatment.

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These investments in mental health are to be lauded, as is the the greater awareness of long COVID. But they fall short of what is needed for people living with persistent COVID symptoms, mental health impacts from the pandemic, and for those whose brain health is otherwise not optimal.

Lost productivity and increased insurance payouts have resulted from this accelerated brain health crisis. The Centre for Addiction and Mental Health estimates poor mental health costs the Canadian economy more than $50 billion annually, of which more than $6 billion is due to lost productivity. And according to the Canadian Life and Health Insurance Association’s latest data, Canadian insurers paid out $420 million in psychology claims in 2020, a staggering 24 per cent increase from 2019.

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Much of the discussion about the “new normal” at the workplace has focused on how we will work. But we need to pay more attention to ensuring people are able to fully participate in the labour market. We are already facing labour shortages thanks to a shift in demographics and as workers choose to retire earlier or leave the workforce because of the pandemic.

  1. Policy-makers are starting to suspect long COVID is a factor behind the labour shortages seen in the U.S. and U.K., where many older workers are looking to work fewer hours or have left the workforce completely.

    Long COVID: The invisible public health crisis fuelling labour shortages

  2. COVID-19’s scale means prolonged complications and recoveries have the potential to become a national and global crisis that could significantly impact our available workforce, long into the future.

    Why the fight against COVID-19 won’t end with a high vaccination rate

  3. None

    Don’t let the two-dose summer fool you — there is a long battle ahead against COVID-19

There is a way forward: we need to treat the post-pandemic brain health crisis with the same urgency as the pandemic crisis. The development and deployment of vaccines bridged existing technology and research from basic to clinical trials; showed us the power and potential of global collaboration across disciplines, institutions, sectors, and countries; and brought together business and science leadership. We can apply these lessons to both research and care, beginning with long COVID. Governments and funders must move away from traditional silos, and think differently about how these may link to a bigger story about brain health. Here’s what that looks like:

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  1. We need to continue the work to develop a concise definition of long COVID and develop a single test for diagnosing long COVID. This will allow us to better understand the size and impact of the problem;
  2. We need to bring attention to the stories of people with lived experience and counter the stigma being faced by those who are not believed because the illness is not well-defined and not always properly diagnosed. Beyond the mental health stress, this has an impact on the ability to access unemployment benefits and disability insurance;
  3. We need to establish more multidisciplinary care clinics to be able to treat the different dimensions of long COVID;
  4. We need to increase funding for multidisciplinary research and longitudinal studies, in order to advance our understanding of what causes long COVID, how to treat it, and the potential long-term impacts, which may include contributing to the development of neurodegenerative diseases in the future. This is not just up to governments. Businesses and the private sector have a role to play and a stake in funding such research; and
  5. Finally, from a workplace perspective, employers need to provide more flexibility and a gradual return to work for those ready to come back.

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We cannot leave long-haulers behind and let long COVID mine the full potential of up to a million Canadians who may be in their prime working years. Brain health is our most precious asset; the health of our workplaces and of our labour force is a function of our brain health. Acting now to ensure it remains optimal will yield higher productivity, and a more dynamic, creative and resilient workforce.

— Inez Jabalpurwala is global director of VINEx.

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 For more stories about the future of work, sign up for the FP Work newsletter.

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