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It’s day 91 since Canada’s 100th coronavirus case. The number of cases is 96,614 as of publication time, up 370 since yesterday—a 40 per cent decrease from the seven-day prior average of new cases.*
Coronavirus may have been present and spreading in Wuhan in August 2019, according to a Harvard study that analysed satellite imagery of car parks outside major hospitals. China has dismissed the study: “To derive these conclusions from phenomena such as road vehicle traffic . . . is extremely preposterous,” said a Chinese foreign ministry spokesperson.
‘An absolutely critical step’: Ontario’s temporary ban on commercial evictions until August is “a great relief” for Chandra Ravi, owner of Epic Planet Fun, an entertainment centre for kids in east Toronto that opened just 10 days before the COVID-19 lockdown. Ravi has been struggling to meet his $24,600 monthly rent since June, his cheques bouncing on the first of every month. Afraid of losing his space, he took a home equity line worth $300,000, but with no cash coming in for the foreseeable future, Ravi lived every day in fear of being locked out of his business. “It was a do-or-die situation,” he said. “I can breathe a little now.”
Ontario’s ban—and commercial rent measures in other provinces—comes as landlords have seemingly refused to apply to the federal rent-relief program, the Canada Emergency Commercial Rent Assistance Program (CECRA). The program set aside $3 billion, but, as of June 4, has only helped 26,000 tenants for $90 million. Small businesses and their associations have decried the program’s strict criteria and confusing application process.
Save Small Businesses’ Michael Smith said Ontario’s announcement was “an absolutely critical step,” estimating it will help save around 50 per cent of the province’s small business from forced closures. Smith believes the ban will incentivize landlords “to cooperate with commercial tenants that qualify for rent relief,” calling the provincial government’s moratorium an “important levelling of the playing field.” In the coming days and weeks, he expects to see CECRA application numbers rise as a result.
Amanda Munday, founder of child-friendly Toronto coworking space The Workaround, told The Logic that after months of pushing her landlord for rent relief they asked her to apply for CECRA on Friday. She welcomed the eviction ban. “It’s the first time I’m able to leave The Workaround and not worry it’s the last time I’m going to be there,” she said, “I always have this creeping feeling of being locked out. But now, just to be able to go to sleep without the threat of evictions is a relief.”
Both Ravi and Munday, however, still worry about making rent for July and August. They say they are in a better position to negotiate reduced rent because of the ban on evictions, but note that meeting rent remains to be a struggle when there is no cash flowing in.
In the markets: Global stocks declined Tuesday, with major indices in Canada, the U.S., Germany, Japan and Europe all closing down as investors took profits by selling stocks. On Monday, the S&P 500 hit positive territory for the year, despite the mass sell-off in March, but it fell back slightly into the negative by Tuesday close. Part of the post-March rally is being driven by investors piling into firms that have declared bankruptcy, like car-rental firm Hertz and department store chain J.C. Penny. Equity-holders often get wiped out during restructuring, but if they don’t, there’s potentially a lot of money to be made for folks who timed the rally correctly. Hertz, for example, has returned 521 per cent in the past five trading days.
It wasn’t just profit-taking driving Tuesday’s decline. Oil prices fell on concerns that demand will remain low as COVID-19 cases increase in many parts of the world. The Russell 2000, which tracks smaller firms that are generally more sensitive to macroeconomic trends, dropped 1.96 per cent in late afternoon trading, as a number of U.S. states reported an increase in COVID-19 cases. In addition, France estimated output would drop 10 per cent this year, Germany reported April exports dropped the most in at least 70 years and Japan announced that machinery orders fell the most in a decade. The Canadian dollar dropped to 74.58 cents U.S. in late afternoon trading.
The tech-heavy Nasdaq, which entered a bull market on Monday, was the major outlier today, briefly reaching 10,000 points for the first time ever before and closing up 0.29 per cent. Meanwhile, Hong Kong-based hedge funds are looking to exit the financial hub due to a new national security law from Beijing. And, sixteen investor petitions related to social or environmental issues have passed at U.S. firms so far this year, eclipsing the 14 that passed in all of last year.
“I used the phrase ‘very rare’ and I think that it’s a misunderstanding to state the asymptomatic transmission globally is very rare. What I was referring to was a subset of studies. I was also referring to some data that isn’t published:” Maria Van Kerkhove, the World Health Organization’s COVID-19 technical lead, clarified that scientists have not yet determined how frequently people with asymptomatic cases pass the virus to others.
Cross-country checkup: Alberta will move into stage two of its reopening on Friday, allowing businesses and institutions—including libraries, movie theatres, health-service providers, summer school classes—to reopen if they can ensure two-metre physical distancing. The province is raising its limit on indoor gatherings to 50 people; 100 people can gather outdoors. It will remove capacity limits on restaurants, cafes, lounges and bars. The province has used more federal resources for COVID-19 aid than any other in Western Canada, having born the brunt of the oil-price slump on top of the pandemic. Child care centres and day camps are able to open across Ontario on June 12 with some restrictions. Restaurants in Quebec are set to reopen on June 15 in most of the province; Montreal restaurants will wait until June 22.
Startup ‘survival mode’: Many Canadian startups are worried the COVID-19 pandemic has forever changed a world in which they were expecting to thrive. Several told The Logic they have had to change the way they operate, foregoing rapid growth for careful expenditure, investment for savings, and growth-at-all-costs for the sustainable development of technology and services they hope will still be viable in a post-pandemic world. “We’re really not sure how to work now,” said Brennon D’Souza, founder of Dibz, an online ticketing app designed to help event-goers get better seats. “You spend all this time preparing for your business but what you don’t plan for is there being no market for what you’ve spent the last couple of years building.”
Over $100 million for tech firms: The Industrial Research Assistance Program (IRAP) Innovation Assistance Program has committed 97 per cent of its $250-million budget and already handed over more than $100 million to tech companies. The federally funded program, which launched in mid-April, is designed to support companies that don’t qualify for the 75 per cent Canada Emergency Wage Subsidy (CEWS). Over 4,000 companies applied for the money, which pays out $847 per employee per week, and around half of those are going to receive it. “We supported the vast majority of companies that were left behind by CEWS because they had little or no revenue,” IRAP vice-president David Lisk told The Logic. “The second cohort were companies demonstrating that they were rapidly scaling and were capable of exporting their products. We were able to support a portion of those.” Firms receive 80 per cent of the money up front and 20 per cent once they demonstrate that they’ve used the funding to pay their employees. The IAP funding lasts for twelve weeks. Earlier this month, CEWS was extended to cover 24 weeks. Asked if IAP would be extended, Lisk said he doesn’t know, but said many companies have asked about it.
Bay Street to Main Street: The number of job postings in Canada continues to tick up with total postings on Indeed Canada at 43 per cent below last year’s pace compared with 49 per cent last month. New postings are still 37 per cent below last year’s trend, but are up 17 percentage points from four weeks prior. New Brunswick, Nova Scotia and Saskatchewan’s job-posting data is better than the rest of the country, with the gap in trend for each of the three provinces at less than 25 per cent. It’s unclear how much better hiring will get, however. Twelve per cent of employers said they intend to hire more, but 17 per cent said they’d hire less and 60 per cent are expecting no change, according to a survey by Manpower Group. That’s the weakest hiring climate since 1978.
- Brookfield Asset Management is investing $350 million in propane supplier Superior Plus.
- The federal government said it will soon take applications for projects bringing high-speed internet to rural and remote areas.
- Multiple international affairs experts called on Ottawa to clarify its rules around foreign takeovers.
- Stephen Poloz, who recently left his role as Bank of Canada governor, is joining the board of tech firm CGI. This is the second recent board appointment for Poloz, who joined Enbridge last week.
- An Ontario union leader is objecting to OMERS’s plan to remove guaranteed 100 per cent inflation indexing for pension recipients.
Trace me on my cellphone: NDP MP Charlie Angus wants Privacy Commissioner Daniel Therrien to weigh in further on how any federally-backed contact tracing app should protect user data—last month, the watchdog told a House of Commons committee the government hadn’t yet consulted him. The U.K. National Health Service’s app will reportedly be ready to launch “within a fortnight,” in time for the government’s next round of relaxing lockdown limits. But Prime Minister Boris Johnson is reportedly unhappy with the rollout, and wants the agency to explore switching to Apple and Google’s joint Bluetooth-based system. Poland released a replacement app using the tech giants’ API, which logs contacts on devices, after privacy concerns over the original, which used a centralized server.
Crowdsourcing the crisis: COVIDShelterRights.ca is an online form that launched today allowing anyone to anonymously report conditions at Toronto’s homeless shelters not following the city’s COVID-19 guidelines. The National Canadian Lawyers’ Initiative has created an online platform to offer pro-bono legal help.
Drinking from the firehose:
- At least 3.3 million U.S. businesses shuttered between February and April, a 22 per cent reduction. By comparison, five per cent of U.S. businesses were lost throughout all of the Great Depression. African-American business-owners were hardest hit by COVID-19.
- The International Air Transport Association forecasts airlines will lose a combined US$84 billion in 2020 and nearly US$16 billion in 2021, as lost passenger revenue totals US$371 billion this year.
- Amazon is setting up COVID-19 testing labs at its fulfillment centres to test warehouse workers every two weeks.
- Instacart, which struggled to gain profits pre-pandemic, is now doing more business in the online grocery delivery space than Walmart.
- Uber Eats is waiving delivery fees for customers who order from Black-owned restaurants in Canada and the U.S.
- 3M filed a lawsuit against an Amazon merchant selling its N95 masks for 18 times their retail price.
- The pandemic is accelerating the shift to e-commerce in Spain—where four out of five small- and mid-sized businesses aren’t equipped to sell online—and other parts of the European Union.
- Robots built to fill gaps in Japan’s aging workforce are being put to work to help people maintain physical distance on the job.
Around the world: China is promoting street vending as a way to boost employment. Paris’ chief prosecutor has launched an investigation into France’s handling of the coronavirus outbreak, with possible charges against national decision-makers including “involuntary homicide” and “endangering life.” The U.S. government has granted contracts worth around US$25 billion to companies during COVID-19 public health crisis; many had little-to-no experience with the medical industry and did not go through the full bidding process, while at least three were formed just days before they received the contract. A supreme court judge in Brazil has ordered the government to resume publishing complete COVID-19 statistics. The United Nations warns the world is on the brink of the worst food crisis in 50 years. Amsterdam is hoping to attract companies again by cleaning up its sex and drugs tourism. The Eiffel Tower will reopen on June 25.
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Brand synergy: In a bid to save the U.K.’s Chester Zoo, supermarket chain Iceland has adopted all its Humboldt penguins and agreed to lobby the government to allow zoos to reopen with social distancing guidelines.
* We’re emphasizing new cases, rather than running totals, because “flattening the curve” is when each day’s new cases are fewer than those of the previous day. The percentage increase is determined based on how today’s cases compare to a rolling seven-day prior average. Numbers may also vary based on countries’ individual testing capacity and reporting.
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