Beijing scraps GDP target as China panics coronavirus will set country back FORTY YEARS

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The unprecedented move comes after the country’s economy shrank by 6.8 percent in the first three months of the year as business shuddered to a standstill amid the coronavirus lockdown. And forecasts for 2020 are less than half of the 6.1 percent growth rate recorded last year.

Life is invaluable. This is a price we must pay, and a price worth paying

Li Keqiang

Chinese premier Li Keqiang told the National People’s Congress the government was not setting a GDP target because foreign markets were so uncertain, not because of domestic conditions.

The coronavirus outbreak, which began in the central Chinese city of Wuhan last December, devastated the country’s manufacturing sector and demand for Chinese goods then nosedived as the virus spread around the world.

Mr Li said the negative growth caused by the economic slowdown was worth the lives saved by the lockdown.

He said: “Life is invaluable. This is a price we must pay, and a price worth paying.”

But economists said the target should have been axed anyway because it promotes wasteful, low-quality growth and pushes provincial officials to generate production regardless of demand.

Cornell University economist Eswar Prasad told the FT: “China’s decision to eschew a GDP growth target rightly de-emphasises growth at all costs and shifts the emphasis to the quality and sustainability of growth.

“The government has wisely used the opportunity provided by the highly uncertain economic outlook in the aftermath of the coronavirus outbreak to drop the growth target.”

The pandemic has left the ruling communist party and its leader Xi Jinping facing some of the greatest challenges in several generations.

Mr Li said: “Pressure on employment has risen significantly.

“Enterprises, especially micro, small and medium businesses, face growing difficulties.

“There are increasing risks in the financial sector and other areas.”

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There are also pressing foreign policy issues amid soaring tensions with the US.

The world’s two largest economic superpowers are at loggerheads over the origins of coronavirus and Beijing’s early handling of the crisis with the first phase of a trade deal agreed thrown into jeopardy by the increasingly aggressive rhetoric.

Donald Trump has blamed China for “this mass worldwide killing” while China has rejected allegations it mishandled the crisis at the outset.

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New Brunswick barbershops busy as province enters new phase of COVID-19 recovery

Some New Brunswickers may be a little less shaggy on Saturday.

Barbershops and hair salons are allowed to open in New Brunswick during the “yellow” phase of the province’s COVID-19 recovery plan, announced on Friday by Premier Blaine Higgs.

Blaine Harris, the owner and operator of Lancaster Barber Shop on the west side of Saint John, opened Saturday morning to find customers already lined up outside his door.

Harris, the registrar of the New Brunswick Registered Barbers’ Association, has been a barber for 35 years. He said his business was closed for 10 weeks due to the pandemic.

“It wasn’t too bad,” Harris said. “I have some dogs, so I was out with my dogs every day. It became boring after a while because there was really nothing you could really do.”

Harris said he was confident hair care centres would be allowed to open soon when New Brunswick entered the “orange” phase two weeks ago, so he began preparing his shop.

All customers are required to answer COVID-19-related questions before they can enter Harris’ shop.

The waiting room, which can now hold only six patrons, features a seating area divided into individual chairs by curtains. Patrons are required to sign a registry, take a number and wait to be signalled to the barber chair.

One of his first customers of the day was 10-year-old George O’Hearon, who was seeking his first haircut since March.

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“It’s not as long,” O’Hearon said, describing what he believes is the best part of getting a trim.

RELATED: Gyms hair salons to open as N.B. enters third COVID-19 recovery phase

Harris said he has no problem with the extra safety precautions, but reopening has not come without challenges.

He said suppliers have increased prices dramatically, especially on personal protective equipment (PPE).

“The masks that we’re using right now, before the pandemic, were $30 a box,” Harris began. “Now those masks are $140. And it’s the same brand, the same product, but the suppliers are saying their supply is more expensive.”

RELATED: New Brunswick reverses ban on temporary foreign workers

Harris’ new-look waiting room was jam-packed throughout the morning.

Chris Maguire waited more than two hours for his first haircut since February.

“It’s never been this long,” Maguire said. “It’s heavy, it’s thick. It’s hard to manage. I’ve got to get up earlier in the morning to get ready for work because there are hairs everywhere.

“A little bit more hairspray than normal, that’s for sure.”

The line extended outside, where customers waited patiently on newly-placed social-distancing sidewalk decals.

“It’s a haircut, right?” said Chris Williston, who was already more than 45 minutes into his wait time before he got in the door.

“But this is one of the rewards we get for being good and respecting our social distancing, so I’m pretty excited for it. It’s like a birthday party for me right now.”

Harris said the pandemic shutdown was his longest stretch without cutting hair in his career, so he was more than ready to return to work.

Not all New Brunswick hair professionals believe reopening right now is prudent.

Douglas Black, owner-operator of Egoiste in uptown Saint John, has a compromised immune system.

He believes New Brunswick may be moving too fast.

“I just had hoped we’d have a little slower pace,” Black said Friday.

“I know people are very anxious, and I know they’re missing our services, but it’s a lot all of a sudden, put into the throes of what you have to do in order to make this happen.”

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Trump goes golfing for 1st time since coronavirus was declared national emergency

U.S. President Donald Trump on Saturday went on his first golf outing since the White House declared a national emergency over the coronavirus in March, visiting his club in the Washington suburbs in a purposeful display of normalcy.

On a sunny spring day, Trump’s motorcade took him from the White House to Trump National Golf Club, and he was spotted wearing a white cap and white polo shirt.

It was his first time at a golf property since March 8, when he visited his club in West Palm Beach, Florida.

That was the same weekend when he met at his Mar-a-Lago retreat with Brazilian President Jair Bolsonaro, whose press secretary later tested positive for the virus.

On March 13, Trump issued a proclamation declaring the pandemic a “national emergency.”

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The U.S. diagnosed its first cases of the coronavirus in Washington state on Jan. 20.

Trump is eager to promote the idea that the United States is returning to normal, although the death toll from the coronavirus outbreak continues to rise and is expected to surpass 100,000 in the coming days.

Trump’s coronavirus task force coordinator, Deborah Birx, told a White House briefing on Friday that Americans over this Memorial Day weekend should “be outside, play golf, play tennis with marked balls, go to the beach — but stay six feet apart!”

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UK PM Johnson's close aide Cummings broke lockdown rules: newspapers

LONDON (Reuters) – British Prime Minister Boris Johnson’s closest adviser, Dominic Cummings, travelled more than 400 km from his London home after showing symptoms of coronavirus, breaking the government’s lockdown rules, the Guardian and Mirror newspapers reported on Friday.

Cummings, a polarising figure in Britain since he masterminded the successful campaign to leave the European Union in 2016, travelled to Durham in northern England in late March, when a strict lockdown was already in place, the reports said.

A spokesman for Johnson’s Downing Street office said it would make no comment. Cummings could not immediately be reached.

The opposition Labour Party said Downing Street should explain his actions. “The British people do not expect there to be one rule for them and another rule for Dominic Cummings,” a spokeswoman said.

Johnson imposed a national lockdown on March 23, asking Britons to stay at home. Non-essential travel was not allowed.

On March 27, Johnson announced that he had tested positive for the virus. On the weekend of March 28-29, Cummings also developed symptoms of the virus. Downing Street said he was self-isolating at home. He returned to the office on April 14.

The Guardian and the Mirror reported that on March 31, police in Durham received a report that Cummings was staying at an address in the city.

“Officers made contact with the owners of that address who confirmed that the individual in question was present and was self-isolating in part of the house,” a spokesman for Durham police was quoted as saying in both newspapers’ reports.

“Officers explained to the family the guidelines around self-isolation and reiterated the appropriate advice around essential travel.”

No comment from Durham police was immediately available.

The two newspapers said that the property where Cummings stayed in Durham was his parents’ house.

The BBC’s political editor quoted a source close to Cummings as saying he did travel to Durham during lockdown but did not breach the rules as he needed his parents’ help with childcare while he was ill. Cummings and his wife have a young son.

The reports could put Cummings in a difficult position, after several senior people involved in the country’s response to the coronavirus outbreak were forced to resign when it emerged that they had broken the lockdown rules.

Epidemiologist Neil Ferguson resigned from his role as a government advisor on May 5 after the Daily Telegraph reported he had met his girlfriend.

Scotland’s Chief Medical Officer Catherine Calderwood resigned on April 5 after she broke her own advice to stay at home by visiting her second home on two weekends.

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Asymptomatic COVID-19 testing happening in Manitoba as two new cases announced

Manitoba has started testing asymptomatic people for coronavirus as just two new cases were announced on Friday.

The total number of probable and confirmed cases in the province now sits at 292.

One person is in hospital and no one is in ICU. There are 18 active cases, with 267 now considered recovered. The number of deaths in the province remains at seven.

According to provincial data, the two new cases include a male child under ten, and a woman in her 30s, both in Winnipeg.

As of yesterday, an additional 873 laboratory tests were performed. This brings the total number of tests performed since early February to 37,272.

Roussin confirmed Friday to 680 CJOB that the province has begun screening asymptomatic people. Those without symptoms can present themselves to testing sites to be screened for the virus, but said that could be cut back if sites become overwhelmed.

“It’s way more important to test symptomatic people,” he said.

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“We didn’t want to see have a run on asymptomatic testing at the detriment of being able to test symptomatic people.”

The province hopes instead to test asymptomatic people in certain groups, Roussin added.

“For instance, certain groups of people who say are required to leave Manitoba frequently safe for work. We might look at the offering asymptomatic testing to them.”

As of Friday, public health restrictions relaxed to allow more people to gather in one space, including a maximum of 25 people indoors and 50 people outdoors, providing social distancing guidelines are being followed.

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Seven Oaks superintendent looking forward to possible Manitoba school reopenings

Some Manitoba kids may be back in school as early as June 1 — although it’ll be very different than the way they left it at the beginning of the coronavirus pandemic.

The second phase of the province’s reopening draft plan says students may come back, in limited numbers, for one-on-one instruction and assessment.

Seven Oaks School Division superintendent Brian O’Leary told 680 CJOB that families shouldn’t be dropping their kids off at schools June 1 — or any time — until they’ve been contacted ahead of time, as not all schools and divisions have confirmed they’ll be reopening.

O’Leary said he’s looking forward to seeing kids have the chance for some degree of a return to normalcy.

“We’d like to get almost all of our students — especially the younger ones — in for some time, just to get back to school and feel optimistic about the future and a return to normal.

“We feel that’s probably good for everyone’s emotional and mental health at this point,” he said.


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La Loche RCMP charge 3 with bootlegging

RCMP say three people are facing bootlegging charges after reportedly trying to bring alcohol into La Loche, Sask.

Alcohol sales in the northern Saskatchewan community were stopped for two weeks on May 9 due to the coronavirus pandemic.

The region is the epicentre of the outbreak in the province, and health officials said too many people were spreading the virus by drinking together.

Police said they received word that people from the community were heading south to buy alcohol to bring back to the community for resale.

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RCMP said several sources in the community informed them that a 24-pack of beer was being resold for more than $200.

It prohibits, directly or indirectly, selling or offering to sell alcohol unless allowed under the act or regulations.

Fines start at $500 for a first offence. A conviction could also result in up to two months in jail.

— With files from Global News’s Mickey Djuric

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Rudderless after a rally, stock markets look for next catalyst

LONDON/NEW YORK (Reuters) – Global equity markets have shuffled up about 1% this month despite the world starting to re-open after the coronavirus-driven lockdowns and U.S. and European economic data showing glimmers of a recovery.

The sideways movement is in sharp contrast to the roughly 30% rally in late March and April, when investors were able to shrug off far more dire economic data and look towards recovery backed by government support.

In some ways, not much has changed in the world’s understanding of the coronavirus and its economic impact. Some investors, economists and public health experts have been warning for weeks that re-opening will be slow, vaccines will take months and the recovery will be prolonged.

And yet, investors appear to be taking heed only now.

In interviews, investors said the explanation partly lies in the failure of the market’s collective wisdom. Stock markets misread how fast growth may rebound. And now they need a new catalyst, such as a vaccine or substantial new stimulus, before they can decide whether to flee or hold the course. But it is proving to be elusive.

“Markets have essentially been range bound for more than a month now waiting for a new driver to emerge,” said Mohamed El-Erian, chief economic advisor at Allianz. He said that positive news on reopenings and vaccines were insufficient to compensate for the string of negative data and concerns about the sharpness of the recovery.

The market’s conundrum underscores a larger predicament facing global policymakers in the battle against the coronavirus. The $15 trillion-plus pledged in global stimulus inflated stock markets in April, as investors took heart that governments will not let the global economy completely melt down. But while the money kept economies afloat, it cannot engineer a recovery.

For that, the virus must first be brought under control.

(GRAPHIC: Dead cat bounce? – here)

TUG OF WAR

Kasper Elmgreen, head of equities at Europe’s largest asset manager, Amundi, described markets as caught in a “tug of war” between bull and bear forces.

Elmgreen described the bullish forces as “the extraordinary fiscal and monetary stimulus that came much faster and more forcefully than during the past crisis.”

On the other side, he said is persistent uncertainty over the pace and shape of economic and earnings recovery. Markets are being premature in pricing a return to normalcy even next year, he added.

“If there is light at the end of the tunnel, corporates are not seeing it,” said Elmgreen.

Indeed, measured against forward earnings, European and U.S. equities are trading back at early-March levels, when the COVID-19 impact was yet to be felt.

But with the world economy predicted to witness its biggest contraction since the Great Depression, U.S. and European earnings should decline 40-45% in the second quarter, Refinitiv data shows.

Influential U.S. investors David Tepper and Stanley Druckenmiller recently described markets as overvalued and with terrible risk-reward. Druckenmiller dismissed V-recovery hopes as “a fantasy”.

(GRAPHIC: Rebound in global equity valuations – here)

EARLY WARNINGS

To be sure, many investors and policymakers initially believed the economic impact of the crisis could be brief, supporting the market’s optimism.

But the stock market has a history of missing warning signals. In the current crisis, too, signs that it was not going to be smooth sailing got downplayed.

Paul O’Connor, head of multi-asset at Janus Henderson, said April “wasn’t a rally that said the world is feeling better about growth or a reappraisal of the macro environment.”

Nervousness was evident all along in bond yields that didn’t rise, gold’s 7% price gain and investors’ refusal to deploy the $4.7 trillion stashed in U.S. money market funds, he noted.

There were other loud warnings, too.

Anthony Fauci, the top U.S. infectious disease expert, said as early as March 3 that it would take at least 12-18 months until a coronavirus vaccine is ready to be deployed. On April 7, former Federal Reserve Chairman Ben Bernanke warned against expecting a quick recovery, saying it was likely that activity will only be restarted gradually and may need to be slowed again if the virus resurges.

CUTTING RISK

The sobering calls are coming true. Experience of countries in Asia, which had dealt with the virus for longer than the West, show that even after months of lockdown, consumers won’t necessarily head out en masse to dine or shop, reducing the likelihood of a V-shaped recovery.

A slow, U-shaped recovery, or worse, a W-shaped double-dip is now expected by 75% of the investors polled by Bank of America Corp’s  securities division.

“We thought central bank interventions had taken out some of the tail risks in the market,” said Wouter Sturkenboom, who helps formulate investment strategy for $350 billion in client assets at Northern Trust Asset Management.

Sturkenboom added risk, including equities, to his portfolio during the March rout and stayed overweight through April. But last week he cut the weighting of risky assets by 7% in favour of cash and cash-like assets. 

“We worry that the initial bounce in growth will be smaller and more gradual than hoped for. The risk of a downside surprise looks about equal to the likelihood of an upside surprise at this point,” Sturkenboom said.  

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Some outdoor amenities opening back up in London, Ont., city says

London, Ont., sports fields, baseball diamonds, and dog and skate parks are among the outdoor amenities being reopened for public use by the city, albeit with new coronavirus pandemic-related health measures and precautions.

The change comes days after the province implemented stage one of its three-stage reopening framework, and extended emergency orders until the end of the month.

City officials stress that gatherings of more than five people who are not from the same household are still barred under provincial orders, and that social distancing guidelines still apply.

In a statement, Mayor Ed Holder said Londoners are being counted on to abide by pandemic health guidelines to ensure the spaces are safe for everyone.

“We know residents are excited to get some fresh air and exercise and we appreciate their patience as City staff work to get all of these park amenities open,” he said.

According to the city, the following amenities have reopened as of Thursday:

  • Outdoor sports fields, baseball diamonds, and basketball courts for non-team sports that allow physical distancing;
  • Skate parks, disc golf, benches, picnic tables, and park shelters, provided that physical distancing of at least two metres is maintained and that residents be aware the amenities are not sanitized and people using them should wash or sanitize their hands afterward;
  • Off-leash dog parks, provided that residents engage in physical distancing and other necessary health measures, like sneezing or coughing into a sleeve, elbow, or disposable tissue, and washing hands often with soap and water or with an alcohol-based hand sanitizer.

Tennis and pickleball courts are also being reopened as part of the plan, but some may not be ready for use until the end of the week as staff are in the process of installing nets, the city says.

Those heading to a course will have to follow a new list of pandemic-related golfing policies and procedures before they tee off.

Community gardens also reopened on Saturday, but only to registered gardeners, who are also being asked to follow new guidelines.

Provincial leaders have indicated that each phase of the government’s reopening framework will last between two to four weeks to allow health officials to monitor the impact of each set of changes.

Regarding gathering size limits, the province said Tuesday that word on any “additional adjustments” to social gatherings, childcare and schools will come later and be informed by advice from Ontario’s top doctor.

London reported six new novel coronavirus cases on Thursday, along with nine recoveries and a newly declared outbreak.

Two of the cases were linked to seniors’ facilities, officials said.

Health officials reported three new cases and four recoveries on Wednesday, and reported 11 new cases on Tuesday.

–With files from Global News’ Beatrice Britneff

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Hewlett Packard to cut costs by $1 billion, reduces CEO pay by 25% on pandemic woes

(Reuters) – Hewlett Packard Enterprise (HPE.N) on Thursday unveiled a plan to cut costs by at least $1 billion by 2022 and said it would reduce the base salary of its chief executive officer by 25%, in response to the impact of the COVID-19 pandemic.

The cost-savings plan will include changes to the company’s workforce and is expected to deliver annualized net run-rate savings of at least $800 million, the company said.

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