Financial Times 08Apr2020

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Briefing


i U science chief quits over virus battleE
European Research Council head Mauro Ferrari has
resigned from the continent’s flagship scientific
body after failing to persuade Brussels to set up a
large-scale programme to fight Covid-19.— PAGE 2

i ufthansa slashes fleet by 40 planesL
The airline has said it will decommission more than
40 aircraft and axe its Germanwings low-cost arm,
warning it will take years to return to the industry’s
pre-pandemic peak in passenger numbers.— PAGE 6

i russels warns of medical bidding warB
EU crisis management chief Janez Lenarcic has
warned there is a “global scramble” for medical
equipment, after days of claims that cargoes have
been suddenly diverted to the US.— PAGE 3

i ellcome Trust in $8bn virus rallying cryW
The global medical research
foundation has urged business
to finance the search for a
coronavirus vaccine, saying it is
the “best exit strategy” from
crippling lockdowns.— PAGE 3

i oubt raised over school closure policyD
A UK study has found closures do little to slow the
coronavirus spread and their economic costs could
outweigh benefits. Some 1.6bn people in 188 nations
are said to have been hit by the strategy.— PAGE 4

i apan gambles on partial lockdownJ
Prime minister Shinzo Abe has declared a “state of
emergency” hat gives governors in seven urbant
prefectures the power to request business closures
but many will be allowed to stay open.— PAGE 2

i YSE to review circuit-breaker systemsN
President Stacey Cunningham has told the FT that a
review will focus on the settings for circuit breakers
for futures on the index. Any changes would have to
be agreed with rival exchange groups.— PAGE 9

Datawatch


An Italian story


Family-owned steel group’s journey


through the crisis— FT SERIES, PAGE 3


WEDNESDAY8 APRIL 2020 WORLD BUSINESS NEWSPAPER EUROPE


World Markets


STOCK MARKETS
Apr 7 prev %chg
S&P 500 2721.12 2663.68 2.
Nasdaq Composite 8025.53 7913.24 1.
Dow Jones Ind 23278.30 22679.99 2.
FTSEurofirst 300 1284.98 1263.02 1.
Euro Stoxx 50 2856.41 2795.97 2.
FTSE 100 5704.45 5582.39 2.
FTSE All-Share 3141.28 3058.85 2.
CAC 40 4438.27 4346.13 2.
Xetra Dax 10356.70 10075.17 2.
Nikkei 18950.18 18576.30 2.
Hang Seng 24253.29 23749.12 2.
MSCI World $ 1881.48 1776.86 5.
MSCI EM $ 853.83 831.72 2.
MSCI ACWI $ 448.72 425.35 5.

CURRENCIES
Apr 7 prev
$ per € 1.088 1.
$ per £ 1.231 1.
£ per € 0.884 0.
¥ per $ 108.995 109.
¥ per £ 134.125 133.
SFr per € 1.057 1.
€ per $ 0.919 0.

Apr 7 prev
£ per $ 0.813 0.
€ per £ 1.131 1.
¥ per € 118.608 117.
£ index 77.695 77.
SFr per £ 1.195 1.

COMMODITIES

Apr 7 prev %chg
Oil WTI $ 26.27 26.08 0.
Oil Brent $ 33.12 33.05 0.
Gold $ 1648.30 1613.10 2.

INTEREST RATES
price yield chg
US Gov 10 yr 0.78 0.
UK Gov 10 yr 0.41 0.
Ger Gov 10 yr 104.25 -0.32 0.
Jpn Gov 10 yr 0.00 0.
US Gov 30 yr 134.06 1.36 0.
Ger Gov 2 yr 105.26 -0.63 0.

price prev chg
Fed Funds Eff 0.65 1.58 -0.
US 3m Bills 0.15 0.10 0.
Euro Libor 3m -0.23 -0.23 0.
UK 3m 0.65 0.64 0.
Prices are latest for edition Data provided by Morningstar

GEORGE PARKER AND LAURA HUGHES
LONDON

Britain’s chief medical officer has
admitted that the UK has a “lot to
learn” from Germany on its rapid roll-
out of coronavirus testing, as Downing
Street said prime minister Boris John-
son remained in a “stable” condition in
an intensive care unit.

Chris Whitty’s frank admission was
made after many weeks in which Mr
Johnson and fellow ministers defended
their policy of ending mass community
testing on March 12, when as few as
5,000 Britons were thought to be
infected by the disease.
As Britain’s daily death rate hit a
record 786, taking total hospital deaths
to more than 6,000, Prof Whitty told a
Downing Street press conference: “We
all know that Germany got ahead in

terms of its ability to do testing for the
virus andwe’ve been trying to learn the
lessons from that.”
While Britain is struggling to carry out
15,000 tests a day — up from only 1,
at the start of the crisis — Germany has
been recording tests of some 50,000 a
day and its death rate is starting to flat-
ten out. The peak of the crisis in the UK
is expected over the Easter weekend.
Germany is reporting around 150
deaths per day. When the UK was the
same number of days into its outbreak,
its daily death toll was more than 500.
Testing is likely to play a key part in an
exit strategy from the UK lockdown, if
ministers can fulfil a promise of increas-
ing testing capacity to 100,000 by the
end of April. For now, tight social dis-
tancing rules are set to remain in force
for some time.
Dominic Raab, foreign secretary and

de facto prime minister in Mr Johnson’s
absence, suggested that a three-week
review of Britain’s lockdown measures
— scheduled to take place early next
week — would be delayed.
Mr Raab said “we need to get beyond
the peak” of the outbreak before decid-
ingwhen to start easing restrictions, cit-
ing the need to examine evidence of the
effectiveness of the lockdown, which
started on March 23.
But the foreign secretary also
appeared to be playing for time in the
hope that Mr Johnson would be back at
work before big decisions were taken on
the future of Britain’s lockdown meas-
ures and its exit strategy.
Mr Raab said Mr Johnson remained in
critical care but was in a stable condition
and breathing without mechanical
assistance, although he had been given
“standard oxygen treatment”.

Britain looks to German mass testing


model as it seeks path out of lockdown


© THE FINANCIAL TIMES LTD 2020
No: 40,369★


Printed in London, Liverpool, Glasgow, Dublin,
Frankfurt, Milan, Madrid, New York, Chicago, San
Francisco, Orlando, Tokyo, Hong Kong, Singapore,
Seoul, Dubai, Doha


AnalysisiPAGE 8

Japanese companies ride
high on their cash piles

Austria €3.90 Malta €3.
Bahrain Din1.8 Morocco Dh
Belgium €3.90 Netherlands €3.
Bulgaria Lev7.50 Norway NKr
Croatia Kn29 Oman OR1.
Cyprus €3.70 Pakistan Rupee
Czech Rep Kc105 Poland Zl 20
Denmark DKr38 Portugal €3.
Egypt E£45 Qatar QR
Finland €4.70 Romania Ron
France €3.90 Russia €5.
Germany €3.90 Serbia NewD
Gibraltar £2.90 Slovak Rep €3.
Greece €3.70 Slovenia €3.
Hungary Ft1200 Spain €3.
India Rup220 Sweden SKr
Italy €3.70 Switzerland SFr6.
Latvia €6.99 Tunisia Din7.
Lithuania €4.30 Turkey TL
Luxembourg €3.90 UAE Dh20.
North Macedonia Den


More than 10m
Americans filed
new claims for
unemployment
benefits in the
second half of
March. Data
suggest leisure
and hospitality
was the sector
hit hardest.
Government was
the only category
that added jobs

Hospitality hit
Change in US employment (’)

- - 

Hospitality
Education & health
Business services
Retail
Construction
Other services
Manufacturing
Mining & logging
Government

Only sector
where
employment
has risen

Data seasonally adjusted
Source: Deutsche Bank Research, Mar 

Martin Wolf


Our path lies between mass deaths


and economic mayhem— PAGE 17


Writers blocked


Literature’s logistical struggle in a


time of Covid-19— NOTEBOOK, PAGE 16


3 Virus reports
Pages 2-
3 Corporate
impact
Pages 6-
3 Markets
Pages 9-
3 Editorial
Comment
Page 16
3 Opinion
Page 17
3 LexPage 18

Inside


DELPHINE STRAUSS— LONDON


The coronavirus pandemic will cut
working hours by almost 7 per cent
worldwide in the second quarter ofthis
year, a “catastrophic” effect equivalent
to the loss of 195m full-time workers,
the International Labour Organization
warned yesterday.
The UN agency said 1.25bn workers —
almost two-fifths of the 3.3bn-strong
global workforce — werein sectors suf-
fering drastic output falls, from retail
and real estate to manufacturing,
accommodation and food services.
More than four-fifths of the global
workforce live in countries where full or
partial lockdown measures are in place.
“Workers and businesses are facing
catastrophe, in both developed and


developing economies,” said Guy Ryder,
ILO director-general. “It will hit the
most vulnerable the hardest.”
The scale and speed of job losses
across the developed world has taken
policymakers by surprise. Almost 10m
people in the US filed initial jobless
claims in the last two weeks of March,
and many economists expect the US
unemployment rate to rise rapidly
above 10 per cent. There are job losses
on a similar scale in Europe, although
many workers can access government
wage subsidy schemes designed to limit
long-term unemployment.
Although people in temporary or low-
paid jobs tend to be hardest hit, the
impact of the economic shutdown is
widespread. According to a survey for
the Financial Times and the Peter G

Peterson Foundation, 73 per cent of
Americans say their family income has
been reduced by the crisis. The propor-
tion is similar for families making more
than $100,000 a year and for those on
less than $50,000.
An ILO analysis three weeks ago sug-
gested the pandemic would lead to 25m
job lossesthis year, more thanafter the
2008 financial crisis. Mr Ryder said it
now seemed likely that more than 30m
jobs were lost in the first quarter alone.
The ILO says the extent of job losses
over the year will depend on the policies
governments adopt but it predicts a far
more severe short-term impact, after
using more timely business survey data
and Google search trends to illustrate
“the dire reality of the current labour
market situation”.

It predictedthatthe number of hours
worked globally would fall 6.7 per cent
in the second quarter of 2020 compared
with the previous three months, reflect-
ing both lay-offs and other temporary
working time reductions. This would be
equivalent to the loss of 195m full-time
jobs, based on a 40-hour working week.
The ILO made its estimate using the
historical relationship between working
hours and purchasing managers’ sur-
veys of business conditions. The ILO
assumedthatother countries taking the
same measures to control the spread of
the virus would face a similar hit to the
effect in the surveyed countries.
The surveys do not provide a picture
of how deep or how long businesses
expects the downturn to be.
Additional reporting by Lauren Fedor

Pandemic will destroy equivalent


of 195m jobs globally, warns UN


3 ILO calculates 7% cut in second-quarter work 3 73% of Americans suffer loss of income


Africa burden


Call for pause


on $115bn debt


A health worker conducts door-to-door
screening for Covid-19 in the Bo-Kaap
district of Cape Town during a 21-day
national lockdown.
South Africa is one of 21 African
nations owing a total of $115bn to the
private sector, according to Moody’s, the
rating agency. Yesterday, leading Afri-
cans, led by Tidjane Thiam, the French-
Ivorian former head of Credit Suisse,
called for a two-year moratorium on
payments to give African governments
the fiscal space to fight thepandemic.
“I would use the word standstill
rather than moratorium,” Mr Thiam
said. “If we don’t do this, there is a risk
that official assistance will end up fund-
ing the private sector.”
Report age 4p
NicBothma/EPA-EFE/Shutterstock


APRIL 8 2020 Section:FrontBack Time: 4/20207/ - 19:04 User:simon.roberts Page Name:1FRONT USA, Part,Page,Edition:EUR, 1, 1

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