The City of Montreal is investing $22 million as part of a sweeping plan to stimulate the local economy weakened by the novel coronavirus pandemic.
The recovery plan consists of 20 measures which will be implemented over the next six months to give businesses a helping hand as lockdown restrictions continue to be lifted. Shopping malls and restaurants’ dining rooms will open in the coming days.
Montreal Mayor Valérie Plante told reporters on Wednesday that the crisis has been hard for residents and merchants, but the new measures will help revitalize the city.
“This is an opportunity to seize and we will do so,” she said.
The investment comes two weeks after a panel of local experts in finance, economy and urban planning outlined 16 recommendations for the economic reopening of Montreal. The city had commissioned the report.
As part of the plan, the city will put $5.6 million toward boosting commercial arteries and merchants. Counc. Luc Rabouin, the executive committee member in charge of economic development, said there will be a special focus on the downtown core.
Montreal is also setting aside $4.8 million to support businesses to adopt new models and to encourage startups. An additional $10.5 million will be used to “reinvent” the city’s economic development by creating new programs to support sustainable investments.
The city is injecting $1.1 million to support and coordinate initiatives in terms of international influence, research, data and training. This includes putting Montreal back on the international map, according to Rabouin.
“Our companies have to be visible, they have to be known,” said Rabouin.
Montreal has been the epicentre of the virus’s outbreak in Canada. There are more than 26,000 cases of COVID-19 on the island.
— With files from Global News’ Gloria Henriquez
© 2020 Global News, a division of Corus Entertainment Inc.
China's economy seen growing 2.5% in second quarter as lockdowns end, stimulus kicks in: Reuters poll – TheChronicleHerald.ca
By Kevin Yao
BEIJING (Reuters) – China’s economy likely returned to modest growth in the second quarter after a record contraction, as lockdown measures ended and policymakers announced more stimulus to combat the shock from the coronavirus crisis, according to a Reuters poll.
The world’s second-largest economy likely grew 2.5% in April-June from a year earlier, reversing a 6.8% decline in the first quarter – the first contraction since at least 1992 when official quarterly gross domestic product (GDP) records started, the poll showed.
But the expected growth rate would still be the weakest expansion on record.
Forecasts by 55 analysts polled by Reuters ranged from a
3.1% contraction in gross domestic product (GDP) to a 4.0% expansion in the second quarter, reflecting uncertainty over the pace of recovery.
China’s services sector, which is dominated by smaller companies, has not rebounded as quickly as industrial production, though there are some signs that consumer confidence is gradually improving.
On a quarterly basis, GDP is expected to have grown 9.6% in April-June, compared with a decline of 9.8% in the previous
The government has rolled out a raft of measures, including more fiscal spending, tax relief and cuts in lending rates and banks’ reserve requirements to revive the virus-hit economy and support employment.
Still, analysts say the recovery remains fragile, as rising coronavirus inflections in some countries overshadow improved demand for Chinese exports while heavy domestic job losses and lingering health concerns have kept consumers cautious.
Data on Tuesday showed the country’s imports in June rose for the first time this year as stimulus boosted demand for building materials, while exports also edged up as overseas economies reopened after lockdowns.
While China’s economy is showing a steady recovery, a hard battle still lies ahead as the situation remains severe both at home and abroad, state radio quoted Premier Li Keqiang as saying on Monday.
China releases second-quarter GDP data on Thursday (0200 GMT), along with June factory output, retail sales and fixed-asset investment.
Analysts polled by Reuters expect industrial output to grow 4.7% in June from a year earlier, quickening from a 4.4% rise in May, while retail sales were seen rising 0.3%, versus a 2.8% fall in May. Retail sales have slumped for five months in a row.
Fixed-asset investment is forecast to fall 3.3% in the
first six months from a year earlier, easing from a 6.3%
slide in the first five months, according to the poll.
POLICY SUPPORT STILL NEEDED
Central bank governor Yi Gang has said China would keep financial system liquidity ample in the second half but would need to consider withdrawing support at some point, raising questions among investors over when it may start dialing down stimulus.
Still, analysts expect policymakers to maintain support for the economy for a while longer to ensure the recovery remains on track, despite a rise in overall debt levels.
Tang Jianwei, senior economist at Bank of Communications, expected the central bank to dole out 1-2 more targeted reserve requirement cuts and another 20 basis points of cuts in the interest rate on the medium-term lending facility in the second half.
Credit growth is also expected to remain strong. New bank lending hit a record 12.09 trillion yuan ($1.72 trillion) in the first half of the year.
Moreover, China has allowed local governments to issue 3.75 trillion yuan in special bonds to fund infrastructure projects, up from 2.15 trillion yuan last year, and issue 1 trillion yuan in special treasury bonds to spur activity.
Tang expected the economy to grow around 2.5% this year.
The International Monetary Fund has forecast an expansion of 1.0% for China for the full year, the only major economy expected to report growth in 2020.
($1 = 7.0092 Chinese yuan renminbi)
(Polling by Shaloo Shrivastava in Bengaluru and Jing Wang in Shanghai; Reporting by Kevin Yao; Editing by Kim Coghill)
UK economy begins tepid recovery in May after record slump – TheChronicleHerald.ca
By David Milliken
LONDON (Reuters) – Britain’s economy took a first step on the long road to recovery from the COVID-19 crisis in May, as activity began to pick up after lockdown restrictions began to ease, but there was less of a rebound than economists had forecast.
Gross domestic product rose by 1.8% in May after slumping by a record 20.3% in April, Britain’s first full month of lockdown, the Office for National Statistics said, below all forecasts in a Reuters poll of economists.
Over the three months to May, the economy shrank by 19.1% and compared with a year ago it is 24.0% smaller.
“The pick-up in output in May is more likely to reflect the partial release of pent-up demand as restrictions began to loosen, rather than evidence of a genuine recovery,” said Suren Thiru, head of economics at the British Chambers of Commerce.
The weak rebound was driven by just 0.9% growth in Britain’s large services sector, with weakness in professional services, commercial property and computer programming.
More than 44,000 people in Britain have died from the disease, the highest death toll in Europe.
Britain’s government closed non-essential shops and other businesses to the public on March 23, shortly after ordering the closure of bars, restaurants and cinemas.
In May, there was a limited relaxation of lockdown rules, and more businesses became used to operating under the new restrictions.
Private sector data has shown some signs of recovery in May and June, as lockdown measures eased, but the Bank of England has warned that a big rise in unemployment is likely later this year as temporary job support measures end.
“Today’s figures underline the scale of the challenge we face. I know people are worried about the security of their jobs and incomes,” finance minister Rishi Sunak said after Tuesday’s data.
Last week finance minister Sunak announced an extra 30 billion pounds ($38 billion) of stimulus to limit the increase in unemployment.
($1 = 0.7970 pounds)
(Reporting by David Milliken and Andy Bruce; editing by Michael Holden)
China's trade rises as economy recovers from virus slump – Yahoo Canada Finance
BEIJING — China’s imports of U.S. goods rose 10.6% in June over a year ago and its global trade also increased in a fresh sign the world’s second-largest economy is gradually recovering from the coronavirus pandemic.
China’s global imports rose 3% to $167.2 billion, rebounding from May’s 3.3% decline, customs data showed Tuesday. Exports edged up 0.4% to $213.6 billion, an improvement over the previous month’s 16.7% contraction.
The country’s global trade surplus was $46.4 billion.
Imports of American goods increased to $10.4 billion despite higher tariffs that were imposed in a fight with Washington over trade and technology. Exports to the United States gained 1% to $39.8 billion.
China, where the pandemic began in December, was the first major economy to shut down to fight the virus and the first to begin the struggle to restore normal business activity after the ruling Communist Party declared victory over the outbreak in March.
Chinese factory activity is recovering but consumers, uneasy over possible job losses, are reluctant to commit to big purchases. Forecasters warn exports are likely to weaken as global demand for surgical masks and other medical supplies declines and U.S. and European retailers cancel orders.
Leading indicators “suggest that exports will start to contract again before long,” Martin Rasmussen of Capital Economics said in a report. Imports “should continue to ramp-up,” he said, as the government spends more to support economic recovery and consumer demand.
The Chinese economy shrank by 6.8% in the first quarter, its worst performance since at least the mid-1960s. The ruling party skipped announcing an economic growth target for this year but private sector forecasts range from low single digits to a small contraction.
Some forecasters raised their outlook slightly after factory activity in May improved more than expected.
Exporters also face hurdles due to U.S. tariff hikes on Chinese goods in the fight over Beijing’s technology ambitions and trade surplus. The two sides signed an agreement in January to postpone further penalties but increases imposed earlier stayed in place.
Joe McDonald, The Associated Press
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