Emerging Markets Daily - April 8
Vaccines vs. Virus As Clock Ticks, Beijing Tops Billionaires List, Why A Global Minimum Corp. Tax?, Uniqlo Eyes Rapid Asia Growth, Chinese Brands Rise to Challenge Majors
The Top 5 Emerging Markets Stories from Global Media - April 8
Vaccines vs. The Virus As The Pandemic Clock Ticks
Bloomberg
“The biggest vaccination campaign in history is underway. More than 704 million doses have been administered across 153 countries, according to data collected by Bloomberg. The latest rate was roughly 16.1 million doses a day.”
“In the U.S., more Americans have received at least one dose than have tested positive for the virus since the pandemic began. So far, 171 million doses have been given. In the last week, an average of 3.03 million doses per day were administered.”
“While the best vaccines are thought to be 95% effective, it takes a coordinated campaign to stop a pandemic. Anthony Fauci, the top infectious-disease official in the U.S., has said that vaccinating 70% to 85% of the U.S. population would enable a return to normalcy.”
“On a global scale, that’s a daunting level of vaccination. At the current pace of 16.1 million a day, it would take years to achieve a significant level of global immunity. The rate, however, is steadily increasing, and new vaccines by additional manufacturers are coming to market.”
“It’s now a life-and-death contest between vaccine and virus. New strains threaten renewed outbreaks. In the early stages of a campaign, the effect of vaccinations are often outweighed by other factors of transmissibility: virus mutations, seasonality, effectiveness of mask use and social distancing. In time, higher vaccination rates should limit the Covid-19 burden around the world.”
“In the U.S., the latest vaccination rate is 3,029,052 doses per day, on average. At this pace, it will take another 3 months to cover 75% of the population.” Bloomberg reports.
Beijing Now has More Billionaires than Any City, Eclipses NY
BBC
“Beijing is now home to more billionaires than any other city in the world, according to the latest Forbes' annual rich list.”
“The Chinese capital added 33 billionaires last year and now hosts 100, said the business magazine. This narrowly beats New York City, which hosts 99 and has held the top ranking for the last seven years.”
“China's quick containment of Covid-19, the rise of its technology firms and stock markets helped it gain top spot. Although Beijing now has more billionaires than the Big Apple, the combined net worth of New York City's billionaires remained US$80bn (£58bn) greater than that of their counterparts in Beijing.” BBC reports
What’s The Deal With The The Global Minimum Tax Pushed by the U.S?
Reuters
“Treasury Secretary Janet Yellen has thrown the weight of the U.S. government behind a push for a global corporate minimum tax rate, possibly carving a path to a long-sought deal updating international tax rules for the first time in a generation.”
“Yellen said on Monday that she is working with G20 countries to agree on a global minimum, which she said could help end a ‘30-year race to the bottom on corporate tax rates.’
“Major economies are aiming to discourage multinational companies from shifting profits - and tax revenues - to low-tax countries regardless of where their sales are made. Increasingly, income from intangible sources such as drug patents, software and royalties on intellectual property has migrated to these jurisdictions, allowing companies to avoid paying higher taxes in their traditional home countries.”
“With a broadly agreed global minimum tax, the Biden administration hopes to reduce such tax base erosion without putting American firms at a financial disadvantage, allowing them to compete on innovation, infrastructure and other attributes.” Leigh Thomas and David Lawder report
Uniqlo Sees Rapid Expansion in Asia, “The World’s Growth Center.”
Nikkei Asia
“Uniqlo owner Fast Retailing wants to accelerate its expansion in Asia, eyeing 100 store openings a year in a bid to thrive in the era after COVID-19, its CEO told reporters on Thursday.”
"‘Asia is and will be the world's growth center,’ said Fast Retailing Chairman and CEO Tadashi Yanai. ‘We will accelerate our expansion in the region so that we can be the overwhelming No. 1 company in Asia.’ Yanai said the company now opens 40 to 50 stores every year in Asia.”
"‘Sooner or later, the pandemic will end,’ Yanai told reporters. "The moment of truth will come when it's over.’ But Yanai also said online commerce would be a key for further growth. To strengthen e-commerce Fast is building automated warehouses all over the world, he said.”
“Yanai spoke after Fast posted an operating profit of 167.9 billion yen ($1.5 billion) for the first half of this fiscal year, up 23% from a year earlier. Strong results in Japan and greater China helped the casual wear specialist to overcome the impact of the COVID-19 pandemic, with declining sales in most regions.” Rurika Imahashi reports.
As China Targets H&M, Nike, Local Chinese Brands See Their Chance
The New York Times
“Western brands like H&M, Nike and Adidas have come under pressure in China for refusing to use cotton produced in the Xinjiang region, where the Chinese government has waged a broad campaign of repression against ethnic minorities. Shoppers vowed to boycott the brands. Celebrities dropped their endorsement deals.”
“But foreign brands also face increasing pressure from a new breed of Chinese competitors making high-quality products and selling them through savvy marketing to an increasingly patriotic group of young people. There’s a term for it: “guochao,” or Chinese fad.”
“HeyTea, a $2 billion milk tea start-up with 700 stores, wants to replace Starbucks. Yuanqisenlin, a four-year-old low-sugar drink company valued at $6 billion, wants to become China’s Coca-Cola. Ubras, a five-year-old company, wants to supplant Victoria’s Secret with the most non-Victoria’s Secret of products: unwired, sporty bras that emphasize comfort.” [More companies are discussed in the article] Li Yuan reports
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What We’re Also Reading…
Move over, Jakarta! Small Cities to Grow Indonesia's Digital Economy
The Jakarta Post
“Small cities in Indonesia are to become the biggest contributors to the country’s digital economy in the next four years, replacing metropolitan cities like Jakarta and Bandung as consumers in big cities reach maturity, says a 2021 report.”
“Digital growth in nonmetropolitan areas such as Magelang in Central Java and Denpasar in Bali will expand around 5 times by 2025 to surpass growth in bigger cities, according to the report by Indonesia's Alpha JWC Ventures and global consultancy Kearney.”
“The pace of growth of Indonesia’s digital economy accelerated as a result of mass digital adoption due to restrictive COVID-19 policies, and is expected to continue as start-ups expand to smaller cities.” Eisya A. Eloksari reports
E-Commerce’s Great Leap Forward In Latin America
Global Finance
“Retail e-commerce jumped 36.7% in 2020, to $84.9 billion in sales throughout the region in 2020, according to SkyPostal, Latin America’s largest private mail and parcel deliverer. And there is little sign the shift will reverse itself.”
“In Brazil, digital sales grew 68% to $41 billion last year, according to the National Confederation of Commerce, Goods, Services and Tourism (CNC). International data consulting firm Kantar found that total e-commerce sales in Argentina jumped 124% to $10 billion. In Panama, e-commerce jumped to 8% of retail sales, more than the 7.8% in Brazil, according to Magento Commerce, Adobe’s e-commerce platform.”
The numbers reveal a deep and accelerating transformation in how goods are sold and delivered in Latin America, embedding changes in technology, logistics and digital payments and opening a new market for consulting and service companies. Pandemic-related measures to ease credit availability are helping companies invest in these changes and shifting many informal and unemployed workers into gigs delivering food and small packages. Denise Marin reports
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