BENGALURU/LOS ANGELES — Houston Rockets guard Russell Westbrook said on Monday that he had tested positive for COVID-19 ahead of the team’s departure to Orlando where the National Basketball Association (NBA) plans to restart its season.
Westbrook, the 2017 Most Valuable Player and nine-time All-Star, said he was in quarantine and would only rejoin the squad when he was cleared.
“I tested positive for COVID-19 prior to my team’s departure to Orlando,” Westbrook, 31, said in a statement posted on Twitter.
“I’m currently feeling well, quarantined, and looking forward to rejoining my teammates when I am cleared. Thank you for all the well wishes and continued support. Please take this virus seriously. Be safe. Mask up!”
Westbrook has been one of the Rockets’ key players this season after his move from the Oklahoma City Thunder, averaging 27.5 points per game. The Rockets are currently the sixth seed in the Western Conference with a 40-24 record.
Twenty-two teams began arriving last week at the Disney ESPN Wide World of Sports complex in Orlando, where they will be housed in a quarantined bubble to train ahead of the scheduled July 30 restart.
The NBA on Monday said 322 players were tested for COVID-19 since arriving on the campus on July 7 and two have returned confirmed positive tests while in quarantine.
Those players never cleared the mandatory 48-hour quarantine upon arrival and have since left the campus to isolate at home or in isolation housing.
Since in-market testing began on July 1 before the players left for Orlando, 19 have tested positive, the league said.
Those players are staying in their so-called home markets and recovering until they are cleared under the US Centers for Disease Control and Prevention (CDC) guidelines and NBA rules for leaving home isolation and joining the campus.
Sacramento Kings forward Richaun Holmes on Monday apologized after he “briefly and accidentally” crossed the campus line to pick up a food delivery.
He is now in quarantine and can rejoin his team in eight days. — Reuters
LONDON — Six-time Formula One world champion Lewis Hamilton praised his Mercedes team for taking a stance against racism but said after winning Sunday’s Styrian Grand Prix that Ferrari and others should do more.
The Briton took a knee with 11 drivers before the race while wearing a Black Lives Matter T-shirt and then gave a raised fist salute on his car and on the podium after winning at the Red Bull Ring.
It was the second weekend in a row that drivers have knelt before the start, although not all have done so.
Taking the knee has become a common act of protest against racism and police brutality since the killing on May 25 of George Floyd, a Black American, by a white police officer in Minneapolis unleashed a global outpouring of sadness and outrage.
The gesture was not part of the official program, as it had been before the season-opener at the same Austrian circuit when Formula One and teams emphasized an anti-racism message.
“We’ve seen Red Bull’s mechanics take a knee, which I think is great, but as businesses and as teams… if you look at Ferrari who have thousands of people working with them, I’ve heard no word of Ferrari saying that they hold themselves accountable, and this is what they’re going to do for their future,” the sport’s only Black driver told reporters.
“And we need the teams to do that. We need Formula One and the FIA to be more leading in those scenarios, saying ‘hey guys, all of us together, everyone needs to pull together and fight for this.’”
“I think a lot of people don’t know what the problem is,” added Hamilton, who has set up a commission to push for equal opportunity and more diversity in motorsport. “Some people deny there is a problem.”
Ferrari, whose race on Sunday lasted about 20 seconds until Sebastian Vettel and Charles Leclerc collided, said the team strongly supported diversity and equal opportunities.
“Equality of treatment and opportunity is not simply about the essential principle of equity,” Ferrari CEO Louis Camilleri said this month when the company was awarded an equal pay certificate.
““It is a fundamental pillar to attract, retain and develop the finest talents to foster innovation and our long-term growth.”
Vettel has knelt alongside Hamilton before both races while Leclerc remained standing but with “End Racism” on his shirt.
“Formula One left us the choice to express ourselves in the way we wanted,” Leclerc said. “It was clearly written on our shirt to end racism, which is the main message we want to pass through.” — Reuters
BARELY a year in the main draw of ONE Championship, fast-rising Filipino fighter Lito “Thunder Kid” Adiwang of Team Lakay has made significant strides and is looking to taking on more challenges, including the possibility of facing off with mixed martial arts legend Demetrious “Mighty Mouse” Johnson.
A product of Rich Franklin’s ONE Warrior Series, strawweight Adiwang (11-2) made his debut in ONE Championship in the landmark “ONE: Century” event in Japan last October, where he made short work of hometown bet Senzo Ikeda, winning by technical knockout in the first round by way of arm bar.
He then followed it up with another impressive victory in January this year here in Manila, submitting Thai Pongsiri Mitsatit by kimura in the opening round, to go 2-0 in ONE.
The twin victories have served notice to the rest of the organization and thrust Mr. Adiwang to the top five in the rankings in the division, which interestingly has teammate Joshua “The Passion” Pacio as champion.
Having the kind of success this early in his ONE Championship career has only pushed Baguio native Mr. Adiwang to strive to be better and set his sights on conquering new heights, which include getting a shot at battling idol Johnson if not now then down the line.
“Yes, it has been my dream to fight Demetrious Johnson since I started training in martial arts. He’s been one of my idols in this sport. I want to test myself against the best in the world, and DJ is it,” said Mr. Adiwang.
“I know I’m new to the game, and just arrived in ONE Championship. But if given the chance to fight DJ now, I’d take it. I’ll be ready with a great game plan,” he added.
Currently Mr. Johnson is fighting in the flyweight division in ONE Championship, making the hoped-for fight impossible at the moment for the Team Lakay fighter.
But just the same, Mr. Adiwang said that given the chance to lock horns with Mr. Johnson he believes he can hold his own against the MMA legend.
“The requirement to beat DJ is full focus for the entire bout, being constantly on the attack and unleashing sharp counters. When you keep him on the back foot, it becomes harder for him to impose his will,” said Mr. Adiwang, who started his career in MMA as a professional in 2012.
“That being said, beating DJ isn’t easy by any means. It’s fun to think about these matchups, and I really love fighting. I just want to fight the best, so bring them on.”
ONE Championship last staged a live event in February before the coronavirus disease 2019 (COVID-19) pandemic ground to a halt its activities.
It is angling to make a return on July 31 with “ONE: No Surrender” in Bangkok, Thailand, to be played at a closed-door and audience-free venue but will be broadcast live all over the globe.
CELEBRITY power couple Alex Rodriguez and Jennifer Lopez reportedly have turned to some heavy hitters associated with other sports in yet another bid to purchase the New York Mets.
Per ESPN, Pro Football Hall of Fame linebacker Brian Urlacher, Super Bowl champion Travis Kelce, former NFL running back DeMarco Murray and retired offensive lineman Joe Thomas have joined the National Basketball Association’s Bradley Beal (Washington Wizards) and Mason Plumlee (Denver Nuggets) as investors in the bid.
“Being a former athlete and having a chance to be a part of a group trying to purchase a professional team, it’s pretty cool,” Urlacher told ESPN on Monday. “It’s especially cool to be involved with Alex. Alex is the man. You’ve got Kelce, Joe Thomas, DeMarco Murray. It’s great to be in a group with them.”
“We couldn’t be more excited to have such high-quality individuals as part of our group,” Rodriguez and fiancee Lopez said in a combined statement, according to CBSSports.com.
The group reportedly made an initial bid of $1.7 billion, per ESPN. The former New York Yankees slugger and Bronx-born actress/singer have reportedly ponied up $300 million of their own money toward the bid.
The sum total, however, trails the $2 billion made by hedge fund billionaire Steve Cohen, according to a report by the New York Post.
Per the newspaper, Mets chief operating officer Jeff Wilpon would prefer to sell to the Rodriguez-Lopez group if its offer is close to the best bid at the end of the auction.
The Wilpons are willing to package SNY, the Mets’ cable network, for sale along with the club, the New York Post reported.
The Wilpons’ previous unwillingness to include SNY in the deal helped sink the first bid from Rodriguez and Lopez, the newspaper reported.
In April, Forbes placed the Mets’ value at $2.4 billion, a 4% rise from last year. The Mets ranked sixth on Forbes list of values for Major League Baseball teams, trailing only the Yankees ($5 billion), Los Angeles Dodgers ($3.4 billion), Boston Red Sox ($3.3 billion), Chicago Cubs ($3.2 billion) and San Francisco Giants ($3.1 billion).
Rodriguez, 44, was a three-time Most Valuable Player and 14-time All-Star in a 22-year major league career that included stints with the Seattle Mariners (1994-2000), Texas Rangers (2001-03) and Yankees (2004-13). His career accomplishments were tarnished by his admitted use of performance-enhancing substances.
Lopez, 50, has enjoyed success as both a movie star and a singer. Fox Business reported in February that her net worth is between $225 million and $400 million, with Rodriguez’s net worth estimated at $300 million to $350 million. — Reuters
For golf, good news came with the bad yesterday. The Memorial Tournament will push through this weekend with a veritable Who’s Who of stars on tap. The Muirfield Village Golf Club has always been a popular destination for members of the United States Professional Golfers Association Tour, and not simply because it also happens to be the venue of living legend Jack Nicklaus’ event; it’s a challenging layout designed by the host himself. And, evidently, the intrinsic pull of the stop overrode and fears fueled by the dramatic spike in novel coronavirus infections.
If there is one “negative,” it’s that spectators will not be allowed. Initially, the Memorial had been preparing for the influx of crowds, albeit under physical distancing protocols, through all four rounds of play. Given the all-too-real dangers of community transmission despite the mitigating measures in place, however, tour officials thought best to restrict attendance to those directly involved in the competition. And it’s telling that they’ve seen fit to extend the decision to the remainder of the tour’s 2019-20 schedule. The PGA Championship, the Wyndham Championship, the Northern Trust, the BMW Championship, and the Tour Championship, will all be absent live fans.
At a time when uncertainty rules, though, the sight of the best of the best plying their trade is one for sore eyes, even from the comfort of homes. Of particular focus will be Tiger Woods, still the sport’s biggest draw despite his advancing age and inconsistent showing; he’ll be teeing off for the first time since finishing 68th — and dead last among those who survived the cut — at the Genesis Invitational in February. Considering his frequent bouts with injury, that he’ll be wielding a club this week is a plus in and of itself. That he has been grouped with stalwarts Rory McIlroy and Brooks Koepka for the first two rounds is decidedly a bonus.
If recent events are an indication, the Memorial figures to do just fine. And so will Woods, who acquitted himself well at The Match: Champions for Charity last May. True, going low in an exhibition featuring an over-the hill opponent and two middling amateurs who carved successful paths in another sport is nothing to crow about. Then again, it’s also nothing to belittle, especially in light of the lengthy break the 15-time major titleholder hitherto took. All told, he’s a must watch in a can’t-miss affair, a conclusion etched in stone.
Anthony L. Cuaycong has been writing Courtside since BusinessWorld introduced a Sports section in 1994. He is a consultant on strategic planning, operations and Human Resources management, corporate communications, and business development.
Climate change, conflict, and economic downturns have exacerbated hunger in recent years, and outbreaks of crop-damaging desert locusts—particularly in Africa—have hurt economic prospects this year.
Hunger and malnourishment are increasing around the world as the coronavirus crisis pushes more people into poverty and limits access to healthy diets, according to the United Nations (UN).
Almost 690 million people were undernourished last year, the most since 2009, and the pandemic could tip as many as 132 million people into chronic hunger by the end of this year, the UN said in a report. At the same time, obesity has been on the rise as healthy foods remain out of reach for billions of people, a problem that will be compounded by the economic fallout from the virus.
“The pandemic is creating a problem not of food availability, but of food access, because people will have less income because of the recession,” said Maximo Torero, chief economist of the UN’s Food and Agriculture Organization, which co-authored the report. More people are shifting to cheaper, less healthy food, which could boost overweight and obesity levels, he said.
Climate change, conflict, and economic downturns have exacerbated hunger in recent years, and outbreaks of crop-damaging desert locusts—particularly in Africa—have hurt economic prospects this year. That means the world won’t reach a target to eliminate hunger by 2030, the UN said, calling for governments to take unprecedented action to tackle the issue.
Most undernourished people live in Asia, though the number is growing fastest in Africa. If trends continue, those affected by hunger around the world will surpass 840 million by 2030, a level last seen in 2004, according to UN data.
The UN’s State of Food Security and Nutrition report was jointly produced by the FAO, the International Fund for Agricultural Development, the World Food Programme, Unicef, and the World Health Organization. The agencies substantially revised down undernourished estimates after receiving more accurate data from nations including China.
While it’s too early to assess the full impact of the lockdowns and other virus-containment measures, another 83 million to 132 million may go hungry this year due to the global economic recession.
Last year, about 2 billion people lacked regular access to safe, nutritious, and sufficient food, the UN said. Healthy diets rich in fruit, vegetables and protein are unaffordable to more than 3 billion people, a challenge that’s set to increase with COVID-19. Poor diets are also causing trillions of dollars in health and environmental costs.
“We need to really act quickly and help the most vulnerable populations” through measures such as social safety-net programs, food deliveries or cash transfers, Mr. Torero said. Underlying that is the need to transform how the food is produced, to enable cheaper and more accessible healthy diets, he said.
Other highlights of the report
• Adult obesity, which totaled 13% of the population in 2016, is seen as a “global pandemic in its own right.”
• Last year, 21% of children under 5 were stunted, 6.9% were too thin and 5.6% overweight.
• Diet-related health costs linked to mortality and non-communicable diseases are seen exceeding $1.3 trillion a year by 2030.
• The social cost of greenhouse gas emissions linked to current diets is estimated at more than $1.7 trillion a year by 2030.
• Healthier diets would cut direct and indirect health costs by as much as 97% and social costs of carbon emissions by as much as 74% in the coming decade.
Between them, Facebook Inc. and Alphabet Inc.’s Google have a dominant position in the online advertising market and that has been under intensifying regulatory and political assault in the US and Europe, with Australia now adding another front of attack. Image via Reuters.
Facebook and Google have for years operated like shop windows for news stories, plying their billions of visitors with free snippets and information from articles across the web. An antitrust tussle that’s coming to a head in Australia is set to change that.
Australia’s competition regulator will this month publish draft rules forcing the two US tech giants to share revenue generated from news with the original publishers, including Rupert Murdoch’s News Corp. A final version of the code, the first of its kind in the world, is due to follow soon after.
Between them, Facebook Inc. and Alphabet Inc.’s Google have a dominant position in the online advertising market and that has been under intensifying regulatory and political assault in the US and Europe, with Australia now adding another front of attack.
Investors are sitting up, too. Should watchdogs in other markets follow Australia, it would chip away at two of the most wildly successful business models of the 21st century, built largely on content free-for-alls. Facebook and Alphabet have combined market values in New York of about $1.7 trillion.
“This would be a major shot across the bow from a regulatory perspective,” said Dan Ives, an analyst at Wedbush Securities in New York. “It could open up a Pandora’s box around monetization and sharing of data.”
‘THIS ONE MATTERS’
In an interview, Australian Competition & Consumer Commission (ACCC) Chairman Rod Sims said he knows of several counterparts overseas who are considering taking similar steps. With traditional media hemorrhaging jobs and facing an assault from populist politicians alleging fake news, the 69-year-old is swinging the pendulum back in the publishers’ favor. To Mr. Sims, it’s about more than simply forcing businesses on his beat to play fair.
“This one matters because journalism matters,” he said. “The fourth estate is such a fundamental part of what makes our societies work.”
Traditional media companies have long complained their content is being exploited by digital platforms without due compensation. But that’s only part of the picture.
While platforms and publishers all compete for web clicks and eyeballs that can be turned into advertising revenue, they’re also allies of sorts. News stories, or even just links to them, are part of the appeal of Facebook and Google, helping them keep visitors engaged and vacuum up more data. The tech giants, in turn, direct traffic back to the publishers’ websites.
‘FUNDAMENTALLY INCORRECT’
The nature of this relationship is central to the crackdown by Australia’s competition watchdog. “There’s no doubt the net value flow is to the platforms,” said Mr. Sims. Facebook has called such an assumption “fundamentally incorrect.”
In a 58-page submission to the ACCC last month, Facebook described news as “highly substitutable” content. Even a complete purge of stories in Australia, Facebook said, would make little difference. “News does not drive significant long-term commercial value for our business,” it said.
Australian news organizations, meanwhile, garnered 2.3 billion clicks from Facebook’s news feed between January and May 2020, Facebook said.
At Google, only a “very small” direct and indirect economic value comes from news in Google Search, Australia Managing Director Mel Silva said in a May blog post. Meanwhile, Google Search accounted for 3.44 billion visits to Australian news publishers for free in 2018, she wrote.
Amid the dispute, it’s not clear what the code will cost the tech giants in Australia. That’s partly because in between the baby pictures and community group posts on Facebook, it’s almost impossible to quantify the subjective appeal of news. “I would say #goodluckregulators,” Rich Greenfield, an analyst at New York-based research firm LightShed Partners, said in an e-mail. “I have no idea how they will determine the value.”
TURNING TIDE
Even Mr. Sims warns it will be “extremely hard,” but says “there are always ways to put numbers around things.” And in recent months, publishers appear to have gained ground in the argument.
In April, France’s antitrust regulator ordered Google to pay media companies to display snippets of articles. Then in June, Google said it would pay certain media outlets it will feature in a yet-to-be-released news service in Germany, Australia, and Brazil. Terms weren’t disclosed.
Perhaps most significantly, Facebook late last year introduced a separate news section, paying the publishers whose stories were featured. Some 200 publishers were involved in the Facebook News service, some of them receiving between $1 million and $3 million a year to put articles in the section.
The ACCC’s mandatory code goes further: the watchdog’s concepts paper raised the possibility of collective media boycotts of Facebook and Google in the absence of “appropriate remuneration.”
In a statement, Google said it has “worked closely and constructively with news media businesses, the ACCC, and the government as part of this process and will continue to do so.”
Facebook “will continue to work closely with news organizations, the ACCC, and the Australian government to sustain a strong news ecosystem,” said Mia Garlick, the company’s director of policy for Australia and New Zealand. But she said: “A regulatory approach that lumps two tech companies together and benefits only the most powerful publishers does not do that.”
Mr. Sims says he’s skeptical of Facebook’s argument that news delivers little economic value, and expects his code to start balancing the equation. “I’m not contemplating failure,” he said. — Bloomberg
The newest complaint is over what the company calls the “simple, yet distinctive” look of the refill pods that are marketed as “Juul-compatible.” The patented designs cover the rectangular shape, transparent look, and cap.
Juul Labs Inc. launched an aggressive legal campaign to halt what it calls a “seemingly endless stream” of black-market cartridges for its e-cigarettes.
The vaping company filed a patent-infringement complaint at the US International Trade Commission in Washington, naming more than four dozen companies it says are importing copycat cartridges for the e-cigarettes. It’s seeking a blanket order that would block imports of any unauthorized cartridges.
The complaint—as well as some four-dozen patent-infringement lawsuits filed in federal courts around the US over the past few days—are part of what the San Francisco-based company paints as an effort to curtail sometimes dangerous products. Juul Chief Executive Officer K.C. Crosthwaite has pledged to repair the image of the embattled company, which was at the center of a debate over whether e-cigarettes should exist at all.
“This new ITC action, if successful, would provide the additional public benefit of helping rid the market of unauthorized Juul-compatible products that can be modified by the user, such as empty and refillable pods, or those containing substances such as THC for which the Juul system was not designed,” Juul said in a statement.
Juul has stopped advertising products in the US and halted sales of sweet nicotine flavors that public-health advocates say can attract younger users. The company’s market value has plunged during the controversy over the vaping epidemic. Juul needs to show it’s addressing critics as it prepares to submit an application later this year asking the Food and Drug Administration to let it remain on the market.
The legal fight also is about Juul protecting its market share, said Sarah Burstein, a professor who teaches design patent law at the University of Oklahoma.
“‘I want to make the only keys that fit in my locks,’ is what they are saying,” she said. “Most of these will settle quickly. These are the kind of things you file and expect the defendants not to show up and get a default judgment.”
This isn’t the first time Juul has used the trade agency to knock out competitors, though earlier cases involved patented technology on how the e-cigarettes worked. Last year it settled lawsuits by getting companies to leave the market, and won an order blocking imports of companies that refused to settle.
The newest complaint is over what the company calls the “simple, yet distinctive” look of the refill pods that are marketed as “Juul-compatible.” The patented designs cover the rectangular shape, transparent look, and cap.
“Seeking to freeride on JLI’s success, numerous infringers have created a seemingly endless stream of infringing copycat products,” Juul said in the ITC complaint, citing “concealed identities, fictitious business names and addresses, and other tactics used to hide the true source.”
The trade commission is an attractive venue when it comes to products, like the compatible pods, that are made overseas. The agency, which typically completes investigations in about 15 months, can order products halted at the border. The type of order Juul is seeking would apply to any pod that can be used with the Juul device that isn’t expressly authorized by the company. — Bloomberg
Calls for the demise of the 60/40 portfolio resurfaced in August, as US-China trade tensions exacerbated fears of a global economic slowdown.
A precipitous slide in Treasury yields is calling into question one of the world’s most popular investment strategies.
The traditional asset mix of 60% stocks and 40% bonds, a starting point for investors since the proliferation of modern portfolio theory in the 1950s, has produced one of the best risk-adjusted returns of the past three decades, outshining debt alone. But with Treasury yields now hovering around zero, and likely to stay there for years, those gains are in doubt.
It’s not the first time that so-called 60/40 portfolios have faced scrutiny; the strategy is often a target of griping after a surge in stocks leaves investors short-changed. Still, this blend has protected many from this year’s volatility, eking out a 2.5% return through last week, according to JPMorgan Chase & Co.’s Jan Loeys.
But with yields in the world’s biggest debt market plumbing new depths, bonds have less room to rise going forward, hurting their use as a hedge against falling stock prices. That has money managers looking beyond Treasuries to securities that have more potential to rally.
“There’s a strong temptation to reach for yield wherever people can find it,” said Bill Merz, head of fixed-income research at US Bank Wealth Management, which oversees $180 billion from Minneapolis. “On a global scale, more investors are migrating out the risk spectrum because they feel they have no choice.”
Calls for the demise of the 60/40 portfolio resurfaced in August, as US-China trade tensions exacerbated fears of a global economic slowdown. Bank of America Corp. and Morgan Stanley warned of sobering returns late last year, but expectations that the Fed will eventually cap yields for some Treasury maturities have given these arguments further traction.
The mix, as measured by the S&P 500 Index and Bloomberg Barclays US Aggregate Bond Index, produced an annual compounded rate of return of almost 10% from 1983 to 2019, JPMorgan’s Mr. Loeys, a senior adviser of long-term investment strategy, wrote in a note June 30.
Going forward, he sees returns on the 60/40 portfolio dropping to around 3.5% per year over the next decade, but investors could boost their returns to a little over 4% by adopting a portfolio that’s 40% stocks, 20% bonds and 40% invested in securities with some characteristics of both, he wrote.
That could include collateralized loan obligations, commercial mortgage-backed securities, real estate investment trusts or utility stocks.
MAKING A MOVE
Investors seem to be on the same page. Conning—an investment manager that oversaw $180 billion from Hartford, Connecticut as of June 30—has looked more closely at structured products such as CLOs over the past three months because it’s an area where prices haven’t been pushed higher by the Federal Reserve’s emergency asset purchases, Chief Investment Strategist Rich Sega said. And US Bank Wealth Management increased allocations to investment-grade corporates and municipal credit in June, Mr. Merz said.
Convertible bonds, which offer a risk profile between bonds and stocks, have also benefited from greater investor interest. US exchange-traded funds tracking this type of debt added more than $300 million in May, and another $427 million in June—the biggest monthly haul in six months, data compiled by Bloomberg show.
“Convertibles are getting the best of all worlds because they have both bond- and equity-like aspects: They are a bond and they are convertible into stocks,” Mr. Loeys said by phone. “They gain when stocks go up and they gain when bonds rally, as both asset classes have in the last three months.”
In Europe, where banks have spent the past decade shoring up balance sheets and deleveraging following the 2008 financial crisis, so-called CoCos—or bonds issued by the lenders that are convertible into stock—have become an appealing bet. They’ve returned more than 6% annually during the five years through June 30, even after accounting for a 9.4% annualized loss in the first half of 2020, according to Daniel Tenengauzer, head of markets strategy at Bank of New York Mellon Corp. CoCos returned double the region’s government bonds over the same period.
Still, some investors aren’t ready to write off 60/40 just yet. Jack McIntyre, who helps oversee more than $60 billion at Brandywine Global Investment Management in Philadelphia, says some of the criticism about this strategy may be unfair.
“No matter what kind of portfolio you have, you need a defensive allocation,” he said. “That 40% serves a role.” — Bloomberg
One silver lining for retail has been the almost complete halt of global travel and disrupted networks of parallel importers, which have trapped high-end shoppers at home. Chinese buyers power over a third of the global industry, and their inability to travel is set to boost the luxury market on the mainland by as much as 10% this year, compared to a 45% plunge in the global industry, according to estimates by Boston Consulting Group. Image via Reuters
Three months after China started to emerge from its coronavirus restrictions, its army of shoppers that help power the global economy are still nervous of travel, reticent to spend, and forming habits that may change the face of consumption permanently.
The verdict for now: a recovery is indeed underway—but it’s slow and vulnerable to setbacks like the latest virus flareup in Beijing.
With global demand for China’s manufacturing goods most likely depressed this year due to the accelerating pandemic, domestic consumer behavior matters even more for the country, as well as the wider global economy.
China powered one-third of global consumption growth from 2010 to 2017, according to a report from McKinsey Global Institute. Over the next 10 years, the growth in Chinese consumption is expected to equal that of the US and Western Europe combined.
Retail sales data due this week is forecast to show a return to growth in June, but the value of sales so far this year will still be well down on the first half of last year.
“Leading indicators suggest retail sales should have continued to recover in June,” according to a report from Bloomberg Economists Chang Shu and David Qu. “Even so, the revival in consumption probably remains a long way off, given changes in behavior to the detriment of contact-intensive services, as well as stress in the labor market and dented incomes.”
High-frequency data for June and the early days of July paint a similarly mixed picture. While housing sales rose in early June from last year, car sales were down.
When all is well, data on gambling receipts in Macau—China’s Las Vegas—can illustrate the confidence of a rapidly growing economy. This year’s data are a stark reminder that the pandemic is far from over: with borders largely closed to Chinese punters, revenue has plunged by more than 90% for three consecutive months, while casinos are losing $15 million daily in expenses, estimated Morgan Stanley.
There may be a rebound for the city’s casinos on the horizon, with Macau’s neighboring Chinese province, Guangdong, agreeing to lift quarantine requirements for travelers returning from the area from Wednesday, paving the way for a revival of the languishing casino industry.
LESS TRAVEL
As an indicator of economic activity, travel data show a picture of incomplete recovery. Highways and rail passenger traffic still shows fewer people traveling than the same period last year, indicating that many aren’t traversing long distances, whether for work or tourism.
Tourism during June’s national holidays was down about half compared to 2019 and the stay-at-home impulse is still strong in the biggest cities, with subway ridership in Beijing and Shanghai remaining below normal levels.
One silver lining for retail has been the almost complete halt of global travel and disrupted networks of parallel importers, which have trapped high-end shoppers at home.
Chinese buyers power over a third of the global industry, and their inability to travel is set to boost the luxury market on the mainland by as much as 10% this year, compared to a 45% plunge in the global industry, according to estimates by Boston Consulting Group.
Physical economic activity is moving online at a rapid pace, judging by the speed at which the delivery of parcels and mail is growing, a bright spot amid a sea of slowing indicators.
The recovery in China provides an example for other nations about how quickly economic demand can rebound once the viral outbreak is contained and people are more confident that just going out and shopping won’t make them ill. But it also shows that any revival will be limited.
“China’s recovery path supports our current baseline forecasts for private consumption in other major economies, which are lagging by 1-2 quarters,” according to Wang Tao, chief China economist at UBS AG. “Robust sequential rebound in retail sales and consumer services, but a soft overall recovery due to weak labor markets and income growth, and persistent concerns about safety and future outlook.” — Bloomberg
By changing their food habits, consumers can reduce the environmental impact of large-scale agriculture. The simple act of buying more mung beans instead of rice translates to a reduction in pollution, said Eufemio T. Rasco, Jr., Chair of the Agricultural Sciences Division of the National Academy of Science and Technology.
By Patricia B. Mirasol
The existing three-step linear food system—food production, marketing, and consumption—is dysfunctional. Consumers are at the core of this food system and their behavior thus influences its outcome. For the system to be fixed, a fourth step—waste management—and circularity need to be established.
This was according to Academician Eufemio T. Rasco, Jr., Chair of the Agricultural Sciences Division of the National Academy of Science and Technology, who highlighted “responsible consumption as the key to a nourishing and regenerative food system,” during the academy’s 42nd Annual Scientific Meeting.
Responsible consumption and production is one of the 12 Sustainable Development Goals adopted by all United Nations Member States in 2015. It calls “reducing our ecological footprint by changing the way we produce and consume goods and resources.”
Circularity, meanwhile, as defined by Wageningen University & Research, “aims to reduce resource consumption and emissions to the environment by closing the loop of materials and substances.”
CONSUMERS ARE NOT VICTIMS
To illustrate the three-step linear food system, Mr. Rasco offered the example of food coming from a distant farm that travels all the way to the city, but whose waste does not return to the farm it came from.
“The traditional way of fixing the system is working on the production side so we always view the problem with the Department of Agriculture,” said Mr. Rasco. “Marketing is occasionally a problem; traders get greedy and start hoarding. We never look at consumers as part of the problem. We always see them as the victim.”
Consumers are at the core of the system, however. “When we choose to eat white rice, millers respond by removing most of the nutrients to make the rice white. Retailers deliver in plastic bags. As a consequence, we suffer because excess intake of such equals chronic disease. We also add to pollution because of the plastics used as part of marketing,” he said, pointing out that consumer behavior determines the outcome of food systems.
CHANGING HABITS
By changing their food habits, consumers can reduce the environmental impact of large-scale agriculture. Mr. Rasco said that the simple act of buying more mung beans instead of rice translates to a reduction in pollution. “The need to use chemical fertilizers is halved in mung bean production. It also produces less greenhouse gases than rice,” he explained.
Mr. Rasco acknowledged the challenge of changing the habits of consumers. To this end, his division plans to target its initial efforts at the middle class. “They are more educated, more open to food choices, and have the financial means. Consumers are not the victims. Empower them by providing the proper information.”
“If the middle class changes, this will have an effect on the farming sector. They will have to adjust in relation to the change in demand. There will be a fallout. The poor will also benefit. Prices will go down and (quality food) will become more available,” he said.
LIFESTYLE AS ADAPTATION
Further down the line, Mr. Rasco wants to develop apps modeled after the GenoPalate app, which analyzes users’ genes to provide them with genetic-based nutrition and food recommendations. He is hoping to work with the Department of Science and Technology and other interested parties to make this concept a reality.
Imagine, he continued, being able to ask your mobile phone: “What can I eat for P20?” and your phone answering “You should not be eating broccoli. That’s expensive. Eat kangkong. That’s also healthy.”
“The real challenge is how to put all these data together. Financial ability is very important,” he said.
Added fellow NAST Academician and faculty member of the University of the Philippines College of Medicine Antonio Dans, who cited data from The 2017 Prospective Urban Rural Epidemiology (PURE) study: “Lifestyle is probably not a choice. We don’t exercise because there’s no place to exercise. We don’t eat healthy because healthy food is expensive. We smoke because tobacco is cheap. Lifestyle is an adaptation to the world we live in rather than a choice we make. The way we change our lifestyle is by changing the world we live in.”
SIDEBAR | Envisioning a better food system by 2050
In his presentation, Agricultural Sciences Division Chair Eufemio T. Rasco, Jr., also listed nine features of the envisioned food system 30 years hence, in keeping with the Philippine Science, Technology, and Innovation Foresight and 30-year Strategic Plan 2020–2050 of the Department of Science and Technology.
Higher food production from urban and controlled environment facilities and more market power to both farmers and consumers are among the benefits of this envisioned 2050 food system as mentioned by Mr. Rasco:
1. Individual consumption decisions will be data- and values-driven.
2. Connection between food producers and the consumer will be more direct.
3. Food production will be highly diversified, local, and seasonal.
4. Production will be closer to the kitchen as urban and peri-urban farms get a bigger share of the food market.
5. Food production from the aquatic environment will grow faster than land-based production.
6. The food system will be circular. Material and energy recovered from wastes, valued as a resource, and returned to the farms and households.
7. Steps in the food system will be digitally interconnected, allowing for a high level of transparency and efficiency.
The number of coronavirus infections around the world hit 13 million on Monday, according to a Reuters tally, climbing by a million in just five days.
The pandemic has now killed more than half a million people in six-and-a-half months, and World Health Organization (WHO) chief Tedros Adhanom Ghebreyesus said there would be no return to the “old normal” for the foreseeable future, especially if preventive measures were neglected.
“Let me be blunt, too many countries are headed in the wrong direction, the virus remains public enemy number one,” he told a virtual briefing from WHO headquarters in Geneva.
“If basics are not followed, the only way this pandemic is going to go, it is going to get worse and worse and worse. But it does not have to be this way.”
Reuters’ global tally, which is based on government reports, shows the disease accelerating fastest in Latin America.
The Americas account for more than half the world’s infections and half the deaths.
Parts of the world, especially the United States with more than 3.3 million confirmed cases, are still seeing huge increases in a first wave of COVID-19 infections, while others “flatten the curve” and ease lockdowns.
Some places, such as the Australian city of Melbourne and Leicester in England, are implementing a second round of shutdowns. Chinese-ruled Hong Kong, albeit with a low 1,522 cases, is to tighten social distancing measures again amid growing worries about a third wave.
The United States reported a daily global record of 69,070 new infections on July 10. In Brazil, 1.86 million people have tested positive, including President Jair Bolsonaro, and more than 72,000 people have died.
“POLITICAL FOOTBALL”
The US state of Florida reported a record increase of more than 15,000 new cases in 24 hours on Sunday, more than South Korea’s total since the disease was first identified at the end of last year. It tallied another 12,624 new cases on Monday.
Coronavirus infections are rising in about 40 US states, according to a Reuters comparison of the past two weeks and the prior two weeks.
Yet US President Donald Trump and White House officials have repeatedly said the disease is under control and that schools must reopen in the autumn.
“The president and his administration are messing with the health of our children,” House Speaker Nancy Pelosi said on CNN’s State of the Union program.
“We all want our children to go back to school, parents do and children do. But they must go back safely.”
WHO emergencies head Mike Ryan urged countries not to turn schools into “another political football”, saying they could safely reopen once the virus had been suppressed.
The leader of the Spanish region of Catalonia urged residents of an area of 160,000 people where cases have surged to stay at home, despite a judge’s ruling throwing out a mandatory lockdown.
Spain, which has been one of the European countries worst hit by the coronavirus, lifted nationwide confinement last month, when the pandemic seemed to have come under control.
After the first cases were reported in China around the new year, it took three months to reach one million cases. But it has taken just five days to climb to 13 million cases from 12 million.
India, the country with the third-highest number of infections, has been contending with an average of 23,000 new infections each day since the beginning of July.
In countries with limited testing capacity, case numbers reflect a smaller proportion of total infections. Experts say official data probably under-represents both infections and deaths. — Reuters
