Global foreign direct investments are expected to fall as much as 15 per cent in 2020 due to the spread of the deadly coronavirus, according to a report from the United Nations.
Automotive, airlines, energy and basic materials industries are expected to be hit the hardest due to the economic fall-out from the coronavirus outbreak.
“The impact on FDI will be concentrated in those countries that are most severely hit by the epidemic, although negative demand shocks and the economic impact of supply chain disruptions will affect investment prospects in other countries,” the United Nations Conference on Trade and Development (UNCTAD) said.
The coronavirus, which originated in the Chinese city of Wuhan, has spread to more than 70 countries, killed more than 3,800 people and infected more than 100,000 people. But countries such as Iran, South Korea and Italy are now emerging to be the latest hotspots as they report faster infection rates than China.
More than two-thirds of the multinational enterprises (MNEs) in UNCTAD’s Top 100 index, a bellwether of overall investment trends, have issued statements on the impact of coronavirus, also known as Covid-19, on their business. Many are slowing down capital expenditure in affected areas while 41 companies in the list have issued profit alerts that will result in lower reinvested earnings, a major component of FDI, the report said.
“On average, the top 5,000 MNEs, which account for a significant share of global FDI, have seen downward revisions of 2020 earnings estimates of 9 per cent due to Covid-19. Hardest hit are the automotive industry (-44 per cent), airlines (-42 per cent) and energy and basic materials industries (-13 per cent),” UNCTAD said.
“Profits of MNEs based in emerging economies are more at risk than those of developed country MNEs.”
Currently, the most significant negative revisions in the automotive industry come from parts producers based in the most affected areas in South-East Asia. But leading car makers in developed economies have not yet registered the shock. The negative impact of the virus is likely to spread and increase further, it added.
The rapid spread of the coronavirus is also expected to delay the announcement of new greenfield projects.
Mergers and acquisitions could also see a slowdown due to the current situation. Data for February showed a significant drop in the completion rate of cross-border acquisitions, which dropped below $10 billion (Dh36.72bn) from normal monthly values of $40 to $50bn, the report said.
Last week, UNCTAD said the contraction in China’s output due to the coronavirus outbreak has cost the global economy about $50bn due to a decline in exports.
China, the world’s second-biggest economy, is a key producer of components used in automobiles, mobile phones, medical equipment and clothing.
Global trade is suffering and supply chains have taken a hit across many sectors as factories across China are gradually resuming work after an extended shutdown that was in place to curb the spread of the virus.
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The specs
Price, base / as tested Dh1,100,000 (est)
Engine 5.2-litre V10
Gearbox seven-speed dual clutch
Power 630bhp @ 8,000rpm
Torque 600Nm @ 6,500rpm
Fuel economy, combined 15.7L / 100km (est)
UAE currency: the story behind the money in your pockets
Some of Darwish's last words
"They see their tomorrows slipping out of their reach. And though it seems to them that everything outside this reality is heaven, yet they do not want to go to that heaven. They stay, because they are afflicted with hope." - Mahmoud Darwish, to attendees of the Palestine Festival of Literature, 2008
His life in brief: Born in a village near Galilee, he lived in exile for most of his life and started writing poetry after high school. He was arrested several times by Israel for what were deemed to be inciteful poems. Most of his work focused on the love and yearning for his homeland, and he was regarded the Palestinian poet of resistance. Over the course of his life, he published more than 30 poetry collections and books of prose, with his work translated into more than 20 languages. Many of his poems were set to music by Arab composers, most significantly Marcel Khalife. Darwish died on August 9, 2008 after undergoing heart surgery in the United States. He was later buried in Ramallah where a shrine was erected in his honour.
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Jewel of the Expo 2020
252 projectors installed on Al Wasl dome
13.6km of steel used in the structure that makes it equal in length to 16 Burj Khalifas
550 tonnes of moulded steel were raised last year to cap the dome
724,000 cubic metres is the space it encloses
Stands taller than the leaning tower of Pisa
Steel trellis dome is one of the largest single structures on site
The size of 16 tennis courts and weighs as much as 500 elephants
Al Wasl means connection in Arabic
World’s largest 360-degree projection surface
Jetour T1 specs
Engine: 2-litre turbocharged
Power: 254hp
Torque: 390Nm
Price: From Dh126,000
Available: Now
KILLING OF QASSEM SULEIMANI
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Dhadak 2
Director: Shazia Iqbal
Starring: Siddhant Chaturvedi, Triptii Dimri
Rating: 1/5
Specs
Engine: Dual-motor all-wheel-drive electric
Range: Up to 610km
Power: 905hp
Torque: 985Nm
Price: From Dh439,000
Available: Now
At a glance - Zayed Sustainability Prize 2020
Launched: 2008
Categories: Health, energy, water, food, global high schools
Prize: Dh2.2 million (Dh360,000 for global high schools category)
Winners’ announcement: Monday, January 13
Impact in numbers
335 million people positively impacted by projects
430,000 jobs created
10 million people given access to clean and affordable drinking water
50 million homes powered by renewable energy
6.5 billion litres of water saved
26 million school children given solar lighting
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'Morbius'
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Rating: 2/5
UAE currency: the story behind the money in your pockets
What the law says
Micro-retirement is not a recognised concept or employment status under Federal Decree Law No. 33 of 2021 on the Regulation of Labour Relations (as amended) (UAE Labour Law). As such, it reflects a voluntary work-life balance practice, rather than a recognised legal employment category, according to Dilini Loku, senior associate for law firm Gateley Middle East.
“Some companies may offer formal sabbatical policies or career break programmes; however, beyond such arrangements, there is no automatic right or statutory entitlement to extended breaks,” she explains.
“Any leave taken beyond statutory entitlements, such as annual leave, is typically regarded as unpaid leave in accordance with Article 33 of the UAE Labour Law. While employees may legally take unpaid leave, such requests are subject to the employer’s discretion and require approval.”
If an employee resigns to pursue micro-retirement, the employment contract is terminated, and the employer is under no legal obligation to rehire the employee in the future unless specific contractual agreements are in place (such as return-to-work arrangements), which are generally uncommon, Ms Loku adds.
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500 People from Gaza enter France
115 Special programme for artists
25 Evacuation of injured and sick
