North America Update: September 29
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- The U.S. response to the COVID-19 pandemic will be one of six topics featured in the first presidential debate on Tuesday evening in Cleveland, Ohio. The presidential campaign moves into the debate period as the nation has surpassed 7 million cases and 200,000 deaths from the pandemic, and as four vaccine candidates enter phase three in clinical trials. COVID-19 has resulted in some changes in this year’s debates. There will not be a handshake between President Trump and former Vice President Biden. There will be a live audience, but limited to 75-80 people with everyone tested ahead of the event. There will not be a post-debate spin room operation, although both campaigns will have surrogates ready to talk with media outlets remotely.
- September’s U.S. employment data will be made public on Friday morning. It’s the last monthly report before the November 3 election. The U.S. unemployment rate fell to 8.4 percent in August, down from 10.2 percent the previous month, marking the fourth straight monthly decline in unemployment after April’s all-time high of 14.7 percent. The number of unemployed people dropped by 2.8 million to 13.6 million, as many businesses continued to rehire employees following pandemic lockdowns. Still, the U.S. jobless rate remains well above the pre-pandemic 3.5 percent rate in February but is now lower than the 2008 global financial crisis peak of 10 percent. Looking ahead, as the number of COVID-19 cases ticks back up and there is still no fourth stimulus package, it is unclear if the U.S. labor market will continue its slow recovery in the fourth quarter or slip backward. However, markets are expecting a drop in the September rate.
- The second wave of COVID-19 appears to be taking hold in parts of Canada. On Sunday, Ontario reported 700 new cases – the highest daily number recorded since the beginning of the pandemic.
- As Canadians struggle with excessively long wait times for high-demand COVID-19 tests, officials released a new coronavirus test for school children that gets rid of the invasive nasal swab and instead asks the children to gargle and spit.
- Canada’s total number of COVID-19 infections totals more than 153,000, with 9,268 fatalities.
- A two-day EU leaders’ summit was postponed by the European Council President Charles Michel after he was in close contact with a security guard who contracted the coronavirus. This in turn delayed important foreign policy decisions. Several other commissioners have also gone into self-quarantine.
- The North-South divide has reignited in the European Central Bank (ECB) as northern states worry about being “saddled” with the debt of Southern Europe due to the EU’s pandemic response. Coinciding with a two-year high against the dollar, fears about the impact on trade in addition to Germans’ concerns about the Pandemic Emergency Purchase Program (PEPP), the united front of the ECB appears to be at risk.
- The Netherlands is the latest European country to introduce new pandemic restrictions. Following its “intelligent lockdown,” the government has tightened its relaxed rules, limiting travel between major cities, ordering the early closure of bars and restaurants, discouraging gatherings, and asking people once again to work from home if possible.
- COVID-19 survival rates continue to improve with advancements in medical treatments. However, an effective vaccine remains the long-term solution to the pandemic.
- Malaysia’s Ministry of Health has upped RT-PCR testing capacity to 38,236 tests, bringing the country’s testing rate to 41 per 1000 people. Currently, 58 labs across the country can conduct tests. Japan recently announced that testing capacity would be upped to 200,000 a day, a sharp increase from 52,000 polymerase chain reaction (PCR) tests and 8,000 antigen tests a day.
- South Korea has emerged as a global production base for COVID-19 vaccines, expecting to earn over 2 trillion ($1.7 billion) in contract manufacturing organization orders for vaccines and medication. The country has secured an early supply of vaccines for 60 percent of its population, part of a two-pronged approach to developing herd immunity. Local biotech firm Genexine was the first to launch human clinical trials of its treatment for severe COVID-19 cases.
- The United Nations Conference on Trade and Development (UNCTAD) warned that Mexico will be the hardest-hit Latin American economy from the COVID-19 pandemic due to the lack of tax incentives, unemployment in tourism, and the decline in exports. The organization predicts Mexico’s GDP will contract by 10 percent. In comparison, the organization predicts GDP for Latin America and the Caribbean as a whole will contract by 7.6 percent, Brazil by 5.7 percent, and Central America by 5.2 percent.
- In the past week, Mexico had an increase of two percentage points in positive COVID-19 cases, increasing from 37 to 39 percent. The Secretary of Health reported 715,457 positive cases and 75,439 deaths at the end of epidemiological week 37.
- Mexico’s foreign minister said that Mexico has signed a commitment to buy potential COVID-19 vaccines through the World Health Organization’s global COVAX plan, which aims to deliver at least 2 billion doses of coronavirus vaccines by the end of next year.
- In Brazil, COVID-19 has so far claimed the lives of 141,741 people. Between late February, when the first case was confirmed in the country, and September 27, 4,732,309 people were diagnosed with the novel coronavirus.
- Brazil is looking at ways to continue providing fiscal support to millions of people and the economy at large while respecting fiscal rules, particularly the spending cap. President Jair Bolsonaro said Brazil needs to create jobs and look after its most vulnerable people.
- On Monday, the government detailed its plan to pay for a new minimum income program called Renda Cidada, with President Jair Bolsonaro and Economy Minister Paulo Guedes still pledging to honor the country’s spending cap and fiscal rules. The proposed program would replace Bolsa Familia, the flagship welfare program of former Workers Party President Luiz Inacio Lula da Silva, which pays women a stipend on the condition that they send their children to school and has been credited with reducing poverty in Brazil.
INSIGHTS & INTEL
- Treasury Secretary Steven Mnuchin and House Speaker Nancy Pelosi have each said they will resume talks this week to pass a new economic relief package before the November 3 U.S. election. The bill could include a second round of stimulus checks and other benefits to Americans and businesses who qualify.
- The House will act first. House Democrats are preparing a new proposal with $2.4 trillion in aid – about $1 trillion less than the Heroes Act passed in May. The new bill would reinstate unemployment benefits, provide direct payments to eligible Americans, renew the Paycheck Protection Program for small businesses and provide some aid to U.S. airlines to avoid mass furloughs in October. Over the weekend, Speaker Pelosi said she will delay a House recess period until a deal is reached. The Senate is scheduled to stay in session through October 9, though that recess start could be delayed if an agreement is not close. This is the last opportunity to get a deal done before November 3.
According to the LA Times, social media has taken COVID-19 shaming to a new level. Major social platforms such as Facebook and Twitter are believed to give users a way to quickly pass judgment and have become a tool for COVID-19 shamers, creating “legal, economic and all kinds of ramifications that never would have happened before.”
- New Virtual Programming: New virtual events from Economist, Forbes, Politico and Washington Post will focus on a wide variety of topics, such as international expansion in a quarantine economy, how CIOs are future-proofing businesses, digital innovations helping to address the effect of the pandemic, and prescription drug affordability.
- SXSW: Following this year’s cancellation of SXSW, the 2021 Festival will take place virtually from March 16-20. SXSW’s education conference, SXSW EDU, will take place the week prior.
- MWC 2021 Series: The Mobile World Congress organizers have adjusted the timing of the 2021 series due to COVID-19. MWC Shanghai is scheduled from February 23-25, with MWC Barcelona taking place June 28-July 1. MWC LA is also planned for 2021 as part of MWC’s full annual cycle of events.
- PAC-12: Following the announcement from the Big Ten to reverse the cancellation of the football season, the Pac-12 has reversed their decision as well. The seven-game season will kick off on November 6.
- Olympics: The IOC and Tokyo 2020 Organizing Committee introduced a list of 52 measures for a safer and “simplified” Games. These measures include eliminating arrival team welcome ceremonies, streamlining transport services, reducing the number of stakeholder personnel present and a 10-15% reduction in the number of non-athlete participants.
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