The Economist The business of survival

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From: The Economist this week - Wednesday Apr 08, 2020 05:22 pm
The collapse in commercial activity caused by the pandemic is far more severe than in previous recessions. If they are to survive, companies will have to master a new environment
   
April 8th 2020 Read in browser
   
  The Economist this week  
 
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  This week’s cover reports on the shock ripping through the business world. With countries in lockdown accounting for over 50% of global GDP, the collapse in commercial activity is far more severe than in previous recessions. Numerous indicators suggest extreme stress. Global oil demand has dropped by up to a third; the volume of new cars and parts shipped on America’s railways has dropped by 70%. Many firms have only enough inventories and cash to survive for three to six months. The exit path for those that survive will be precarious, with uneasy consumers, an efficiency-sapping stop-start rhythm, and tricky new health protocols. In the long run companies will have to master a new environment. The crisis and the response to it are accelerating three trends: an energising adoption of new technologies, an inevitable retreat from freewheeling global supply chains and a worrying rise in well-connected oligopolies.

 To read more of our coverage of the virus and its consequences visit economist.com/coronavirus. And look out for a special edition of this newsletter on Saturday. 		 
 
  Zanny Minton Beddoes, Editor-In-Chief  
     
Must-reads from the current edition
 
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White House v virus
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United States
 
 
 
Boris Johnson in intensive care
Patient number one

Covid-19 tests Britain’s prime minister, and its constitution
Britain
 
 
 
Europe’s response
The coronabonds conundrum

Once again, the euro zone is consumed by rows over debt
Europe
 
 
 
Ructions in the oil market
Upside down

An unprecedented plunge in demand will up-end the industry
Briefing
 
 
 
Manufacturing at a distance
Still made in China

The virus is changing factories. Some of the new ways of doing things will be permanent
Briefing
 
 
 
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Living on a prayer

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International
 
 
 
Venezuela’s navy meets its match
A battle in the Caribbean

A Bolivarian patrol boat takes on a peaceful cruise ship, and loses
The Americas
 
Wisconsin’s Democratic primary went ahead. A last-minute order from the Democratic governor to postpone the election, and other state contests, until June because of covid-19 was overturned by the state Supreme Court. Those voters who did venture out to the polling stations faced long queues.
 The S&P 500, Dow Jones Industrial Average and NASDAQ stockmarkets all rose by more than 5% on April 6th, as investors reacted positively to slowing death rates from covid-19 in a few places. But with America expecting a surge in new cases, trading remained turbulent. Oil prices whipsawed in reaction to differing reports about the possibility of Russia and Saudi Arabia reaching a deal to end their price war. A meeting between Russia and OPEC was postponed until later in the week, after which a meeting of G20 oil ministers is scheduled to take place.
 
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