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Italy to Resume Travel; Macau’s Economy Shrinks: Virus Update – Yahoo Canada Finance

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(Bloomberg) — Italy’s health minister confirmed the country can go ahead with the plan to start allowing travel across the nation next week. Brazil overtook Spain to rank fifth in the world in coronavirus deaths, with no sign of easing in Latin America’s biggest economy.

The U.S. will quit the World Health Organization after President Donald Trump faulted its actions with China and the virus.

A front-running vaccine candidate being developed in China is expected to be available as soon as the end of this year, according to a report published in China. Moderna began a mid-stage trial of a vaccine that showed promising safety and early efficacy data this month.

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Key Developments:

Virus Tracker: Cases top 5.9 million; deaths over 365,000Texas shows the world how to reopen cautiously—for nowEuropeans not feeling very hopeful about their economy just yetRace to the freezer: Europe’s food glut has nowhere to goHow China tested 11 million people in just two weeksBaseball on ESPN: Korea’s major league plays through pandemicBrits emerge from lockdown to find affordable dining threatened

Subscribe to a daily update on the virus from Bloomberg’s Prognosis team here. Click VRUS on the terminal for news and data on the coronavirus. For a look back at this week’s top stories from QuickTake, click here.

Italy to Open Travel Even for Lombardy (7:04 a.m. NY)

Italy’s health minister confirmed the country can go ahead with the plan to start allowing travel across the nation next week, even as some regional governors oppose letting people from the hard-hit Lombardy region move freely.

Data on the spread of the virus is improving and allows for the reopening among regions, Health Minister Roberto Speranza told newswire Ansa. The announcement came after a late night meeting with Prime Minister Giuseppe Conte and various coalition party representatives and ministers.

Macau’s Economy Shrinks by Almost Half (6:46 a.m. NY)

Macau’s economy posted a deeper contraction in the first quarter as lockdown measures introduced to contain the virus outbreak hit revenue from gambling, hotels, and tourism.

Gross domestic product in Macau plummeted 48.7% in the first three months of 2020, according to the city’s statistics department. That is the fifth straight quarterly decline.

Belgium’s Socialists Propose $41.7 Billion Stimulus (6:14 a.m. NY)

Paul Magnette, the head of Belgium’s Socialist party, proposed a 37.6 billion-euro ($41.7 billion) stimulus package to combat the economic toll of the global pandemic, according to an interview with Le Soir. The aid would target catering, cultural and health-care industries, he said.

Iran Reports Fewer New Cases (6:12 a.m. NY)

Iran’s infection tally rose to 148,950 as the daily number of new cases dropped to 2,282 from 2,819 on Friday, the highest daily number of cases in eight weeks. The virus death toll reached 7,734 with 57 more deaths overnight.

S&P Sees Abu Dhabi, Bahrain Economies Shrinking (5:20 p.m. HK)

Abu Dhabi’s economy will contract 7.5% this year, S&P Global Ratings said, citing lower oil production and the pandemic.

Bahrain’s economy will shrink 5% this year because of low oil prices, although government stimulus measures should provide some support, S&P said. The ratings company expects Bahrain’s economy to rebound in 2021 as oil prices recover and regional activity increases.

Merkel Says Stimulus Plan to Promote Innovation (5:19 p.m. HK)

German Chancellor Angela Merkel said an economic stimulus program her ruling coalition is seeking to agree on in coming days should be focused on innovation and sustainable industries.

“We will decide on a growth program in the coming week that should help the economy to get back on track and grow,” Merkel said Saturday in her weekly podcast. “The trick will be to do it in such as way as to give a boost both to innovation and sustainable industries, so that we also become strong in the sectors of the future.”

Indonesia Gears Up for Post-Holiday Return (5:02 p.m. HK)

Indonesia’s capital Jakarta is anticipating one million vehicles will enter the city as people return from Eid al-Fitr holidays. Traffic, including motorcycles, is projected to peak from Saturday to Monday, according to a Cabinet Secretariat statement. While the figure is lower compared to the 2.8 million vehicles recorded last year, the flow of so many travelers is raising concern as the nation’s coronavirus cases grow.

Indonesia now has the highest coronavirus death toll in Southeast Asia, with 1,573 people succumbing to the disease as of Saturday. New cases have more than doubled in May, with the total reaching 25,773.

Uzbekistan Extends Lockdown Restrictions (3:36 p.m. HK)

The Uzbek government has decided to extend lockdown restrictions until June 15. Central Asia’s most populous nation has confirmed 3,513 cases of infection of the coronavirus, with 14 deaths and 2,728 recoveries.

Singapore Reports 506 New Cases (3:30 p.m. HK)

Singapore reported 506 new infections as of Saturday, according to a statement from its Health Ministry. A vast majority of the additional infections are of work permit-holders who live in foreign workers’ dormitories, according to the statement. The ministry is expected to provide additional details in the evening, it added.

Chinese Vaccine Expected to Begin Mass Output This Year (3:25 p.m. HK)

A front-running Covid-19 vaccine being developed in China is expected to be available as soon as the end of this year, according to a report published in the official Wechat account of the State-owned Assets Supervision and Administration Commission.

The vaccine, jointly developed by the Beijing Institute of Biological Products and China National Biotec Group Co., has completed phase II testing and may be ready for the market at the end of this year or early next year, said the report.

The production line for the vaccine will be fully disinfected and closed in preparation for output to start Saturday, and will have a manufacturing capacity of 100 million-120 million vaccines each year.

Iran Lifts Restriction on Shopping Hours (2:26 p.m. HK)

Iran has lifted a restriction on the operating hours of shopping malls in the latest step of reopening the economy. Meanwhile, all mosques in the country will be open to worshipers for daily prayers three times a day, President Hassan Rouhani said in a national coronavirus taskforce briefing broadcast on state TV.

South Korea Has Outbreak at Distribution Center (1:46 p.m. HK)

South Korea reported 39 new coronavirus cases in 24 hours as health officials seek to control a new outbreak at a distribution center for Softbank-backed Coupang Corp., an e-commerce company.

A total of 108 infections are related to the center, the vice head of the Korea CDC said in a briefing. That tally includes 73 employees and 35 people who might have come into contact with the employees. A separate outbreak related to nightclubs in Itaewon, Seoul have increased to 269 infections as of Saturday, Kwon said.

Most Australians Support State Border Closures (1:40 p.m. HK)

The majority of Australians approve of states’ decisions to shut their borders amid the coronavirus crisis, according to a new poll.

More than three in four Australians surveyed this week said they back the closures, including 40% who “strongly” support them, according to a release by The Australia Institute, a public policy group that commissioned the poll. One in five opposed the states’ measures.

“The strong support for state border closures shows that while there is much public relief with some public health restrictions lifting, there is also still much community concern regarding the spread of Covid-19,” Ben Oquist, the institute’s executive director, said in the release.

U.S. Supreme Court Rejects California Church (12:36 p.m. HK)

A divided U.S. Supreme Court refused to exempt a San Diego church from crowd limits imposed by California to stop the spread of the coronavirus.

Chief Justice John Roberts joined the court’s liberals in the 5-4 majority, writing that judges should be reluctant to second-guess state officials on questions of health and safety during a pandemic. The order came hours after the court refused to intervene on behalf of two Chicago-area churches that said Illinois coronavirus restrictions were so strict they violated the Constitution.

Australia to Urge Eliminating Payroll Tax (11:20 a.m. HK)

Australia’s government will call on states to eliminate payroll taxes as part of the nation’s efforts to jump-start the economy and create jobs, Treasurer Josh Frydenberg said in an interview with the Daily Telegraph.

“I’d love the states to get rid of the payroll tax,” he said.

The government’s coronavirus recovery plans will involve changes to taxes on income, and for small and medium businesses, Frydenberg said in the interview. The proposals should be finalized ahead of the government’s annual budget release in October, he said, according to the report.

Sotheby’s Realty Gets Trump Backing to Fight Michigan Lockdown (10:40 a.m. HK)

A group of small business owners in Michigan fighting stay-at-home orders by the state’s governor, saying they threaten their livelihoods, got a boost from the Trump administration.

“As the president and many states have recognized, the onerous restrictions on civil liberty that Americans have tolerated to slow the spread of Covid-19 cannot continue forever, and the Constitution will not allow them to do so,” the Justice Department said in a court filing in support of a lawsuit challenging executive orders by Governor Gretchen Whitmer.

The lawsuit the Trump administration is backing was filed in late April by a franchise of Sotheby’s International Realty, along with a lawn and property maintenance company, an automotive glass exporter, an engine oil and auto parts distributor, a jewelry store, a dental office and an association of car washes.

Singapore, China to Allow Essential Travel Starting (9:42 a.m. HK)

Singapore and China have agreed to allow essential travel for business and official purposes between the two countries in early June, according to a joint emailed statement.

The Fast Lane arrangement will be first applied between Singapore and six Chinese provinces or municipalities directly under the central government, and will gradually expand to include additional areas. Covid-19 prevention and control measures will remain in place.

The agreement comes as countries cautiously seek to begin so-called “travel bubbles” after the pandemic shut down borders. China, where the coronavirus first emerged, appears to have brought its cases under control, while Singapore is moving toward opening its economy after wrestling to contain an outbreak among thousands of foreign workers.

China Cargo Ship Source of Two New Reported Infections (9:35 a.m. HK)

Two crew members of a Chinese-registered cargo ship, Zhong Chang Rong Sheng, tested positive for Covid-19 in China’s Shandong Province after they arrived from India via Singapore, state television CCTV reported on its official Weibo account.

The two Chinese nationals, and another crew member who hasn’t tested positive, have been hospitalized, while the remaining 19 people on board are still under quarantine on the vessel. It docked at Lanshan Port of Rizhao in Shandong province on May 27. The two infections are among four new coronavirus cases, all imported, reported by China.

Chile Gets Flexible Credit Line From IMF (8:35 a.m. HK)

The International Monetary Fund approved a $23.9 billion credit line for Chile as one of South America’s wealthiest nations grapples with a recession amid the virus that the central bank forecasts may be the worst since the 1980s.

The two-year flexible credit line is a precautionary measure that should boost market confidence and provide insurance against downside risks, the fund said in an emailed statement late Friday. Managing Director Kristalina Georgievasaid that although the nation has a good track record, its trade openness exposes it to external risks.

United Airlines Will Add Back International Flights in July (8:30 a.m. HK)

United Airlines Holdings Inc. will add back some international flying in July, saying demand has “risen modestly” in some markets after the Covid-19 pandemic all but wiped out travel.

Flights will resume or increase on 40 international routes in July, United said in a statement Friday. The Chicago-based airline will serve only 27 foreign routes in June. United has said its overall schedule will be down about 75% from a year earlier in July, compared with a 90% reduction currently.

The plan to increase flying reflects a modest rebound in demand for all U.S. airlines as travel restrictions ease and economic activity picks up.

Germany, EC Settle Lufthansa Aid (7:15 a.m. HK)

Germany settled a dispute with the European Commission over a 9 billion-euro ($9.9 billion) bailout of Deutsche Lufthansa AG, clearing the way for the carrier to accept a rescue package to help it weather a collapse in travel demand triggered by the pandemic.

The deal requires Lufthansa to reduce the number of aircraft kept at Frankfurt and Munich airports. Lufthansa said it would surrender up to 24 takeoff and landing slots, making room for new competitors at each hub.

Germany on Monday offered Lufthansa a package of loans and equity investment to keep the carrier flying through the coronavirus. But after the EU demanded the carrier give up slots in Munich and Frankfurt, the airline’s supervisory board unexpectedly held off on accepting this lifeline — throwing the rescue plan into turmoil after weeks of talks.

Brazil Deaths Go Past Spain (6:30 a.m. HK)

Brazil eclipsed Spain and now ranks fifth worldwide in coronavirus deaths with no sign the pandemic is slowing in Latin America’s largest economy. The country reported 1,124 new deaths Friday, pushing the total to 27,878, past Spain with 27,121. Brazil registered 465,166 cases, trailing only the U.S.

Infections are reported in 70% of Brazilian cities, the Health Ministry said on Friday. Earlier this week, the ministry said the curve of cases was still growing, and a report by UBS published Wednesday said that six of Brazil’s 27 states are peaking, while total deaths are increasing in 21 states.

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Britain's economy went into recession last year, official figures confirm – The Globe and Mail

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Open this photo in gallery:

People walk over London Bridge, in London, on Oct. 25, 2023.SUSANNAH IRELAND/Reuters

Britain’s economy entered a shallow recession last year, official figures confirmed on Thursday, leaving Prime Minister Rishi Sunak with a challenge to reassure voters that the economy is safe with him before an election expected later this year.

Gross domestic product shrank by 0.1 per cent in the third quarter and by 0.3 per cent in the fourth, unchanged from preliminary estimates, the Office for National Statistics (ONS) said on Thursday.

The figures will be disappointing for Mr. Sunak, who has been accused by the opposition Labour Party – far ahead in opinion polls – of overseeing “Rishi’s recession.”

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“The weak starting point for GDP this year means calendar-year growth in 2024 is likely to be limited to less than 1 per cent,” said Martin Beck, chief economic adviser at EY ITEM Club.

“However, an acceleration in momentum this year remains on the cards.”

Britain’s economy has shown signs of starting 2024 on a stronger footing, with monthly GDP growth of 0.2 per cent in January, and unofficial surveys suggesting growth continued in February and March.

Tax cuts announced by finance minister Jeremy Hunt and expectations of interest-rate cuts are likely to help the economy in 2024.

However, Britain remains one of the slowest countries to recover from the effects of the COVID-19 pandemic. At the end of last year, its economy was just 1 per cent bigger than in late 2019, with only Germany faring worse among Group of Seven nations.

The economy grew just 0.1 per cent in all of 2023, its weakest performance since 2009, excluding the peak-pandemic year of 2020.

GDP per person, which has not grown since early 2022, fell by 0.6 per cent in the fourth quarter and 0.7 per cent across 2023.

Sterling was little changed against the dollar and the euro after the data release.

The Bank of England (BOE) has said inflation is moving toward the point where it can start cutting rates. It expects the economy to grow by just 0.25 per cent this year, although official budget forecasters expect a 0.8-per-cent expansion.

BOE policy maker Jonathan Haskel said in an interview reported in Thursday’s Financial Times that rate cuts were “a long way off,” despite dropping his advocacy of a rise at last week’s meeting.

Thursday’s figures from the ONS also showed 0.7 per cent growth in households’ real disposable income, flat in the previous quarter.

Thomas Pugh, an economist at consulting firm RSM, said the increase could prompt consumers to increase their spending and support the economy.

“Consumer confidence has been improving gradually over the last year … as the impact of rising real wages filters through into people’s pockets, even though consumers remain cautious overall,” Mr. Pugh said.

Britain’s current account deficit totalled £21.18-billion ($36.21-billion) in the fourth quarter, slightly narrower than a forecast of £21.4-billion ($36.6-billion) shortfall in a Reuters poll of economists, and equivalent to 3.1 per cent of GDP, up from 2.7 per cent in the third quarter.

The underlying current account deficit, which strips out volatile trade in precious metals, expanded to 3.9 per cent of GDP.

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How will a shrinking population affect the global economy? – Al Jazeera English

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Falling fertility rates could bring about a transformational demographic shift over the next 25 years.

It has been described as a demographic catastrophe.

The Lancet medical journal warns that a majority of countries do not have a high enough fertility rate to sustain their population size by the end of the century.

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The rate of the decline is uneven, with some developing nations seeing a baby boom.

The shift could have far-reaching social and economic impacts.

Enormous population growth since the industrial revolution has put enormous pressure on the planet’s limited resources.

So, how does the drop in births affect the economy?

And regulators in the United States and the European Union crack down on tech monopolies.

The gender gap in tech narrows.

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John Ivison: Canada's economy desperately needs shock treatment after this Liberal government – National Post

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Lack of business investment is the main culprit. Canadians are digging holes with shovels while our competitors are buying excavators

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It speaks to the seriousness of the situation that the Bank of Canada is not so much taking the gloves off as slipping lead into them.

Senior deputy governor, Carolyn Rogers, came as close to wading into the political arena as any senior deputy governor of the central bank probably should in her speech in Halifax this week.

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But she was right to sound the alarm about a subject — Canada’s waning productivity — on which the federal government’s performance has been lacklustre at best.

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Productivity has fallen in six consecutive quarters and is now on a par with where it was seven years ago.

Lack of business investment is the main culprit.

In essence, Canadians are digging holes with shovels while many of our competitors are buying excavators.

“You’ve seen those signs that say, ‘in emergency, break glass.’ Well, it’s time to break the glass,” Rogers said.

She was explicit that government policy is partly to blame, pointing out that businesses need more certainty to invest with confidence. Government incentives and regulatory approaches that change year to year do not inspire confidence, she said.

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The government’s most recent contribution to the competitiveness file — Bill C-56, which made a number of competition-related changes — is a case in point. It was aimed at cracking down on “abusive practices” in the grocery industry that no one, including the bank in its own study, has been able to substantiate. Rather than encouraging investment, it added a political actor — the minister of industry — to the market review process. The Business Council of Canada called the move “capricious,” which was Rogers’s point.

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While blatant price-fixing is rare, the lack of investment is a product of the paucity of competition in many sectors, where Canadian companies protected from foreign competition are sitting on fat profit margins and don’t feel compelled to invest to make their operations more efficient. “Competition can make the whole economy more productive,” said Rogers.

The Conservatives now look set to make this an election issue. Ontario MP Ryan Williams has just released a slick 13-minute video that makes clear his party intends to act in this area.

Using the Monopoly board game as a prop, Williams, the party’s critic for pan-Canadian trade and competition, claims that in every sector, monopolies and oligopolies reign supreme, resulting in lower investment, lower productivity, higher prices, worse service, lower wages and more wealth inequality.

(As an aside, it was a marked improvement on last year’s “Justinflation” rap video.)

Williams said that Canadians pay among the highest cell phone prices in the world and that Rogers, Telus and Bell are the priciest carriers, bar none. The claim has some foundation: in a recent Cable.co.uk global league table that compared the average price of one gigabyte, Canada was ranked 216th of 237 countries at US$5.37 (noticeably, the U.S. was ranked even more expensive at US$6).

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Williams noted that two airlines control 80 per cent of the market, even though Air Canada was ranked dead last of all North American airlines for timeliness.

He pointed out that six banks control 87 per cent of Canada’s mortgage market, while five grocery stores — Sobeys, Metro, Loblaw, Walmart and Costco — command a similar dominance of the grocery market.

“Competition is dying in Canada,” Williams said. “The federal government has made things worse by over-regulating airlines, banks and telecoms to actually protect monopolies and keep new players out.”

So far, so good.

The Conservatives will “bring back home a capitalist economy” — a market that does not protect monopolies and creates more competition, in the form of Canadian companies that will provide new supply and better prices.

That sounds great. But at the same time, the Conservative formula for fixing things appears to involve more government intervention, not less.

Williams pointed out the Conservatives opposed RBC buying HSBC’s Canadian operations, WestJet buying Sunwing and Rogers buying Shaw. The party would oppose monopolies from buying up the competition, he said.

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The real solution is to let the market do its work to bring prices down. But that is a more complicated process than Williams lets on.

Back in 2007, when Research in Motion was Canada’s most valuable company, the Harper government appointed a panel of experts, led by former Nortel chair Lynton “Red” Wilson, to address concerns that the corporate sector was being “hollowed out” by foreign takeovers, following the sale of giants Alcan, Dofasco and Inco.

The “Compete to Win” report that came out in June 2008 found that the number of foreign-owned firms had remained relatively unchanged, but recommended 65 changes to make Canada more competitive.

The Harper government acted on the least-contentious suggestions: lowering corporate taxes, harmonizing sales taxes with a number of provinces and making immigration more responsive to labour markets.

But it did not end up liberalizing the banking, broadcasting, aviation or telecom markets, as the report suggested (ironically, it was a Liberal transport minister, Marc Garneau, who raised foreign ownership levels of air carriers to 49 per cent from 25 per cent in 2018).

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The point is, Canada has a competition problem but solving it requires taking on vested interests. Conservative Leader Pierre Poilievre has indicated he is willing to do that, calling corporate lobbyists “utterly useless” and saying he will focus on Canadian workers, not corporate interests.

“My daily obsession will be about what is good for the working-class people in this country,” he said in Vancouver earlier this month.

Even opening up sectors to foreign competition is no guarantee that investors will come. There are no foreign ownership restrictions in the grocery market (in addition to the five supermarkets listed above, there is Amazon-owned Whole Foods). When the Competition Bureau concluded last year that there was a “modest but meaningful” increase in food prices, it recommended Ottawa encourage a foreign-owned player to enter the Canadian market. It was a recommendation adopted by Industry Minister Francois-Philippe Champagne, to no avail thus far.

But it is clear from the Bank’s warning that the Canadian economy requires some shock treatment.

Robert Scrivener, the chairman of Bell and Northern Telecom in the 1970s, called Canada a nation of overprotected underachievers. That is even more true now than it was back then.

It’s time to break the glass.

jivison@criffel.ca

Get even more deep-dive National Post political coverage and analysis in your inbox with the Political Hack newsletter, where Ottawa bureau chief Stuart Thomson and political analyst Tasha Kheiriddin get at what’s really going on behind the scenes on Parliament Hill every Wednesday and Friday, exclusively for subscribers. Sign up here.

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