Preparations for future treatment advance; Shell slashes dividend, Europe holds back on stimulus plan

CORONAVIRUS ALERT 4/30/2020

The Atlantic Council’s Coronavirus Alert is a regular summary of policy, economic, and business events around the emergency. To stay updated, sign up to the Coronavirus Alert here.

In top stories today:

  • Efforts to find a vaccine for coronavirus registered some progress, with a focus on ramping up production even before any treatment is approved for human use. Energy giant Shell slashed its dividend and said changes to consumer behavior may be here to stay. The European Central Bank kept its powder dry on further stimulus measures.
  • QUOTE: “The data shows that remdesivir has a clear-cut, significant, positive effect in diminishing the time to recovery,” said Dr. Anthony Fauci, speaking alongside US President Donald J. Trump at the White House on April 29, The Washington Post reported. “That is really quite important.”
  • Drug company AstraZeneca agreed to produce an experimental coronavirus vaccine developed by researchers at Oxford University as the race to find the key to halt the pandemic heats up, The Sydney Morning Herald said, publishing a Bloomberg article. The deal with Oxford University shows how developers aim to make vaccines before they’ve cleared tests on humans to speed up the distribution of the shots, the newspaper reported.
  • “Trump’s ‘Operation Warp Speed’ Aims to Rush Coronavirus Vaccine” runs a Bloomberg headline. The program, a tie-up between pharmaceutical companies, government, and the military, aims to cut the time to develop a vaccine by as much as eight months, the newswire said, citing two unidentified people. The project’s ambition is to have three hundred million doses available by January, Bloomberg said, adding that such a rapid development of a vaccine is unprecedented.
  • The latest on the Gilead Sciences remdesevir drug trial gets wide coverage after the company said on April 29 that at least 50 percent of coronavirus patients treated with a five-day dose improved. Dr. Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases, which is running the trial, released data later that day because of concern about leaks, Reuters reported. The Financial Times publishes an explainer about the drug.
  • QUOTE: “[W]e’re going to work very closely with the government and with health care systems to make sure that it’s accessible, that it’s affordable to governments,” Daniel O’Day, Gilead’s chief executive, told news service Stat. “We’re going to make sure that access is not an issue with this medicine.”
  • The European Central Bank held back from further stimulus measures in response to the coronavirus outbreak at its latest meeting, although it reaffirmed an already enormous program to buy bonds, Reuters reported. Data published earlier on April 30 showed that the eurozone’s economy contracted at the fastest rate on record in the first quarter, the Financial Times reported. 
  • The UK is about to miss a key testing target for coronavirus as officials said the country will not be exiting a lockdown any time soon, Bloomberg said. Justice Secretary Robert Buckland said the government is unlikely to meet its deadline of April 30 to conduct one hundred thousand daily tests to detect infections, the newswire reported.
  • Oil behemoth Royal Dutch Shell cut its dividend for the first quarter by two-thirds, a first since World War II, CNBC reported. The decision was prompted by a slump in the price of oil amid the coronavirus crisis, CNBC said. Europe’s biggest oil company is braced for a permanent change to customer behavior, a sign that demand may not recover in full once the pandemic is over, Bloomberg said.
  • QUOTE: “[G]iven the risk of a prolonged period of economic uncertainty, weaker commodity prices, higher volatility, and uncertain demand outlook, the Board believes that maintaining the current level of shareholder distributions is not prudent,” Chad Holliday, chair of the board of Royal Dutch Shell, said in a statement, CNBC reported.

POLLUTION FOCUS

  • The environment and coronavirus, two separate issues? Researchers are probing the links between the disease and toxic air pollution, with studies suggesting a correlation between mortality rates from the disease and dangerous levels of particulate matter, the Financial Times reported.
  • European countries under coronavirus lockdown posted 11,000 fewer deaths caused by pollution in April compared with a year earlier due to a reduction in fossil fuel emissions, according to research by the Centre for Research on Energy and Clean Air, the Straits Times said. The newspaper published in Singapore carried an article by Agence France-Presse.
  • There appear to have been no transmissions of coronavirus from to adults from children, who contract coronavirus less often and with less severity than the population at large, Bloomberg reported, citing an analysis of global virus studies by the Don’t Forget the Bubbles pediatric blog.

“MASSIVE DAMAGE”

  • Unemployment worldwide will be much worse than predicted, with those in informal sectors that are often in poorer countries the worst affected, the Financial Times reported. The International Labour Organization said 1.6 billion people in the informal economy face “massive damage” to their livelihoods, the Financial Times said. More than 140 million migrant workers in India now face destitution after losing their jobs since the coronavirus lockdown began, the newspaper reported in a long-form article.
  • “’Survival’: Tenants, landlords brace for largest rent strike in decades” reads an NBC News headline. Tens of thousands of tenants will join the largest coordinated rent strike in decades in Los Angeles, New York, and Philadelphia on May 1 as coronavirus puts millions of Americans out of work and increases financial anxiety, NBC said.
  • Wizz Air is bullish about the recovery in travel as the Hungarian low-cost airline become the first big European carrier to restart passenger services, the Financial Times reported. Wizz Air plans to run about 70 percent of its flights in July and August depending on travel restrictions, joining Ryanair, which plans to resume 80 percent of flights by September, the Financial Times said. But many in the aviation industry predict it will take two to three years for passenger demand to get back to 2019 levels, it reported.
  • Japan’s legislators approved a $240 billion coronavirus stimulus plan that includes almost one thousand dollars for every person in the country, while small businesses get tax relief and cash too, The Wall Street Journal reported. That goes even further than similar measures in the United States, which phases out payments for those on higher incomes, the newspaper added.
  • Prime Minister Shinzo Abe said the Olympic Games couldn’t be held in their full form next year unless the coronavirus pandemic is contained, The Japan Times said, publishing a Reuters report. Japan has spent nearly thirteen billion dollars on preparations for the Games, which were postponed last month until July 2021, the newspaper said.
  • Japan is preparing to extend its state of emergency, currently in place until May 6, by about a month, Reuters said in a separate report, citing government sources.
  • The International Energy Agency (IEA) expects global demand for energy to decline by 6 percent this year, the steepest drop in seventy years, as 4.2 billion people worldwide in some form of coronavirus lockdown affect demand, CNBC reported. 
  • Global demand for coal is set for its biggest annual decline since World War II as the coronavirus pandemic has only hastened the demise of burning coal to make electricity, Bloomberg reported, also citing the IEA report. Doing so has “become unprofitable and socially untenable,” the newswire said.
  • China’s economic recovery is uneven three months after the coronavirus lockdown began, with exporters warning the worst might be ahead, the South China Morning Post reported, citing sentiment surveys released on April 30.
  • QUOTE: “If the two powers [United States and China] can accept what cannot be changed—and cannot be expected to change—the doors would begin to open for cooperation, which we need desperately,” Peter B. Walker wrote in the South China Morning Post. “Dealing with the pandemic jointly would be a great start.”

RESOURCES:

READ MORE ON CORONAVIRUS

Coronavirus