Asia Pacific Update: May 22
n today’s edition, key developments relate to the long-term impacts and handling of the COVID-19 pandemic. In Dubai, more than two-thirds of businesses are expecting to fold within six months. Brazil’s rising numbers are seeing experts tip it as the next major COVID-19 global hotspot. In Asia, commercial office real estate authorities are anticipating a shift in the market as remote working becomes the norm while Thailand is developing new solutions to address its lost tourist revenue during the pandemic.
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Latest Disease Updates
- As of 11:00 SGT on Friday, 22 May, 2020 (03:00 BST / 22:00 ET, Thursday), 5,102,424 cases have been confirmed globally, with 332,924 deaths (6%), according to Johns Hopkins University
- The US continues to report the highest rate of infection with more than a million confirmed cases at 1,577,147, accounting for 31% of all infections globally.
- Together, the US, Spain, Brazil, the UK and Russia account for 53% of all cases worldwide
- President Trump won’t close US if second wave of coronavirus hits: President Trump has previously said there may be “embers” of the pandemic that persist in the U.S. past the summer, but he maintains that they will be stamped out. Health experts, including those in the Trump administration, have said that the virus will likely continue to spread through the fall and winter, and may become even more difficult to combat once flu season begins.
- Brazil poised to become global coronavirus hotspot: Brazil suffered a record of 1,188 daily coronavirus deaths on Thursday and is fast approaching Russia to become the world’s No. 2 COVID-19 hot spot behind the United States. President Jair Bolsonaro is under growing pressure for his handling of the outbreak, which looks set to destroy the Brazilian economy and threatens his re-election hopes. He strongly opposes social distancing measures and has repeatedly pushed for greater usage of chloroquine as a remedy for the virus, despite health experts’ warnings about risks.
- Future for commercial office real estate in Asia Pacific looks uncertain: Esther Liu, director at S&P Global Ratings, said: “We expect that the recessionary conditions will soften leasing demand in major central business districts across Asia Pacific. We also believe the ‘working-from-home’ measures may lead to a shift in longer term demand, as they present companies with the opportunity to cut space requirements.” However, that shift will take time, and there won’t be a “significant drop” in occupancy in the near term, particularly in the prime, central locations, she added.
- 70% of Dubai companies expect to go out of business within six months: A staggering 70% of businesses in Dubai expect to close their doors within the next six months as the coronavirus pandemic and global lockdowns ravage demand, a survey by the Dubai Chamber of Commerce revealed Thursday. The Chamber surveyed 1,228 CEOs across a range of sectors between April 16 and April 22, during the emirate’s strictest lockdown period. Nearly three-quarters of those surveyed were small businesses with fewer than 20 employees.
- ‘Pipeline’ proposed between low-risk tourists and Thai destinations: Thai authorities are mulling over waiving quarantine requirements for selected foreign travelers when the ban on incoming commercial flights are lifted, by matching tourists from low-risk countries with low-risk destinations within the kingdom. “This concept involves identifying low-risk areas in Thailand and overseas to create a sort of international tourist bridge or pipeline linking travelers between these two areas,” the Tourism Authority of Thailand’s (TAT) deputy governor for international marketing Chattan Kunjara Na Ayudhya said.
- China: China has made a rare decision not to set a target for its economic growth for 2020. Last year, GDP expanded by 6.1%, just making the government’s official target range of 6-6.5%. (CNBC) Chinese doctors are seeing the coronavirus manifest differently among patients in a new cluster of cases in the north-east region compared to the original outbreak in Wuhan, suggesting that the pathogen may be changing in unknown ways and complicating efforts to eliminate it. (The Straits Times)
- Thailand: Japanese appliance-maker Panasonic said on Thursday that it will move its Thailand-based production of refrigerators and washing machines to Vietnam, laying off about 800 workers. (Bangkok Post) Meanwhile, Thailand’s health technology industry is pegged to hit US$1.45 billion this year, representing compound annual growth of 4.9% since 2017 as the government doubles down on digitalization of the healthcare sector. (The Business Times)
- Indonesia: West Java Governor Ridwan Kamil has said that the province’s large-scale social restrictions (PSBB) will continue “proportionately” until May 29, with some cities and regencies to allow for more movement and economic activity if they are at lower risk of COVID-19 transmission. (The Jakarta Post)
- Australia: Australia, after bringing its coronavirus outbreak largely under control, is seeking an exemption from a requirement that travelers arriving in Britain quarantine for 14 days to prevent the spread of COVID-19. (The Straits Times) Meanwhile, Melbourne has begun testing waste water and excrement for traces of the virus in a bid to focus conventional testing and tracing strategies on problem suburbs or neighborhoods. (South China Morning Post)
- New Zealand: New Zealand Prime Minister Jacinda Ardern has raised the idea of a four-day work week as an approach that might help accelerate economic recovery in the wake of the coronavirus pandemic. (CNN)
- Malaysia: Anyone traveling into Malaysia will have to pay for their compulsory COVID-19 hotel quarantine from June 1. Foreigners and permanent residents will have to pay the full cost of RM150 (US$34.50) a day, while returning Malaysians will be charged half of that amount. (CNA) Meanwhile, Interstate travel in Malaysia has been banned for everyone after people thronged police stations to apply for permission to return to their hometowns ahead of the Hari Raya weekend. (Business Insider Singapore)
- Pakistan: COVID-19 infections in Pakistan are approaching 50,000, official data shows, with total deaths crossing 1,000. The rise in infections follows the government’s recent decision to end the nation’s lockdown. (CNA)
- Japan: Japan’s core inflation rate has turned negative for first time in three years after the coronavirus outbreak pushed down prices of oil and hotels in April. (Nikkei Asian Review) Japan may lift the state of emergency in Tokyo as early as next week if new coronavirus infections remain low, raising hopes that the world’s third-largest economy may soon start recovering from recession. (CNA)
- Korea: South Korea has extended its “special travel advisory” by another month, urging citizens to refrain from going abroad as the coronavirus pandemic continues to affect many parts of the world. (Korea Herald)
- Hong Kong SAR: Hong Kong SAR recorded no new COVID-19 infections on Wednesday, as the city prepares for the relaxation of social distancing measures. (South China Morning Post)
- India: At least six Indian pharmaceutical companies have joined the global race to develop a novel coronavirus vaccine. Top player Serum is targeting a product launch by Q2 2021. (Nikkei Asian Review) Ticket pricing restrictions, protective suits and goggles for flight attendants and restricted food service are among the rules proposed by India’s civil aviation ministry as it prepares to resume domestic flying within days. (CNA)
DEEPER PERSPECTIVES: Cross-competitor collaboration in COVID-19
“While still a prominent and complex problem, stakeholders are aggressively fighting back against fake news and its ilk with renewed ferocity. The battle is taking place on multiple fronts. Social media networks are rapidly implementing new policies and features to limit the spread of fake news, governments in Africa and Europe have launched targeted anti-disinformation campaigns, while one brand has even developed an app to help employees navigate fake news.”
May’s edition of Trends in Two Minutes examines how, in the wake of COVID-19, fake news and alternative facts are being rejected in favour of a new prioritising of expertise and authority; additional trends explored include the rise of localized supply chains and the new value of cross-competitor collaboration in a post-pandemic world.
SECTOR FOCUS: Renewable energy
As part of our regular monitoring of the latest developments and impact on businesses, we will regularly take a deeper dive into one sector. Today, we look at the impact on renewable energy in the Asia Pacific region.
- Reliant on oil-related revenues, Malaysia has been impacted by oil price volatility, facing US$3.8 billion in potential losses from oil-related revenue for 2020. Indonesia, Southeast Asia’s largest oil producer faces a similar situation in its energy sector.
- Jet fuel consumption has halved in the past two months as travel restrictions and border controls have severely limited air travel.
- Behavioural changes, such as working from home, have altered energy consumption patterns during the pandemic. Bloomberg NEF calculated that current air pollution levels have improved by 54% in Seoul. NO2 levels in Singapore, Kuala Lumpur, Manila and Bangkok fell. Malaysia, Thailand and Cambodia have reported clearer skies following restriction on movement.
- APAC governments and businesses are committing to measures that reduce carbon emissions and incentivise the use of renewable energy. Currently, Asia Pacific contributes 50% of global energy demand and carbon emissions.
- In April, the Asian Infrastructure Investment Bank committed US$100 million to the Keppel Asia Infrastructure Fund, investing in pan-Asian infrastructure assets including renewable energy.
- South Korea have launched their New Green Deal for investments in renewable energy, introducing carbon taxes and phasing out domestic and overseas coal financing by public sector institutions. The Regional Energy Transition Centre will be established to support redeployment of workers to sustainability-centric sectors.
- Japan’s big three commercial banks MUFG, Mizuho and SMBC and the Japan Bank of International Cooperation (JBIC) have recently said they will no longer accept proposals for coal generation, following international criticism over potential Japanese funding for the Vung Ang 2 coal plant in Vietnam.
- In March, the Philippines’ government approved 1.2 gigawatts (GW) of offshore wind capacity. On April 23, Filipino conglomerate Ayala’s power generation arm, AC Energy, said it will halt new and existing coal projects by 2025, making a full exit by 2030.
- Australia has seen year-on-year increase in usage of renewable energy, with 24% of the country’s electricity generated from renewable sources in 2019. As part of the country’s economic US$10.1 billion response to COVID-19, commercial and industrial solar will be supported through tax write-offs.
- As one of the top exporters of photovoltaic solar panels to the US, Malaysia is well placed to use solar panels domestically. In the short term, however, supply chain problems have affected the production of solar panels and wind turbines.
- Energy consultants Wood Mackenzie estimate that up to 150 GW of wind and solar power projects across Asia Pacific could be delayed or cancelled over the next five years as a result of COVID-19’s economic impact. The firm also warned that lower fossil fuel prices could mean renewables remain less competitive against coal in most Asia-Pacific markets until after 2025.
Media analysis of stories covering Australia, Cambodia, Hong Kong SAR, Japan, Malaysia, Macau, New Zealand, Philippines, Singapore, South Korea, Taiwan, Thailand, Vietnam from April 23 – May 22.
About COVID-19 News Roundup:
- The content of this news bulletin is a summary of publicly available news articles on events and developments related to COVID-19.
- The views and opinions reflected by these headlines do not necessarily represent those of Weber Shandwick.