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COVID-19: Transport keeps us going 

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COVID-19: Transport keeps us going. Image: Pixabay 
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With the slogan “Transport keeps us going”, ESPO, together with 33 organisations has issued a Declaration stressing the essential role transport is playing in the corona crisis.

“Transport and logistics play a crucial role in the supply of essential goods in this critical period. To ensure that transport can continue to keep us going, the free flow of goods between Member States must be guaranteed. We must also support and encourage all the people working in transport. Their contribution in overcoming this crisis is vital. In times of emergency, ports have an essential role in providing citizens, health services and businesses with the goods and materials they need. Europe’s ports take this public responsibility very seriously. We hope the Member States are following the recommendations of the Commission to ensure that goods keep moving in Europe, in the interest of every single EU citizen,” comments Isabelle Ryckbost, ESPO Secretary General.

Logistics & Supply Chain

Businesses supposed to remain open throughout COVID-19, reminds FTA

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Businesses supposed to remain open throughout COVID-19, reminds FTA. Image: Pixabay
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FTA, the business group representing the logistics industry, wants to reassure the public that it is working hard to keep the nation trading during the COVID-19 pandemic, and is busy supporting all sectors of the economy, in line with government advice.

FTA wants to make clear that businesses are supposed to remain operational as usual. Only non-essential retail shops and public venues are required to shut.

Elizabeth de Jong, Policy Director at FTA, comments: “FTA wants to remind the public that generally businesses are supposed to stay open during the COVID-19 pandemic. The government has made clear in its rules that only non-essential retail shops and public venues must shut; otherwise, businesses are supposed to remain operational as long as they comply with the guidance around hygiene, home working and social distancing.”

“The logistics sector remains focused on keeping the nation trading throughout the COVID-19 pandemic; this is essential to not only ensure businesses continue to receive the goods and raw materials they need to remain operational, but to limit the economic impact of this crisis. However, safety will always be the number one priority and should government guidance change, logistics will be ready adapt to the new rules.”

Under government rules, businesses must meet the following requirements to remain operational: have their staff work from home wherever possible, but if they must work in the office or similar working environment, they must remain 2m apart wherever possible. Workers are also permitted to travel to their jobs if it is not possible to work from home, even if these jobs are not “key worker” jobs.

Government guidance states that “With the exception of some non-essential shops and public venues, we are not asking any other businesses to close – indeed it is important for business to carry on.”

The full guidance is available online, here: https://www.gov.uk/government/publications/guidance-to-employers-and-businesses-about-covid-19/guidance-for-employers-and-businesses-on-coronavirus-covid-19

Efficient logistics is vital to keep the UK trading, directly having an impact on more than seven million people employed in the making, selling and moving of goods. With Brexit, new technology and other disruptive forces driving change in the way goods move across borders and through the supply chain, logistics has never been more important to UK plc. FTA is one of the biggest business groups in the UK, supporting, shaping and standing up for safe and efficient logistics. We are the only business group in the UK that represents all of logistics, with members from the road, rail, sea and air industries, as well as the buyers of freight services such as retailers and manufacturers whose businesses depend on the efficient movement of goods.

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Oil and Gas

COVID-19 and oil price war could derail two-thirds of the world’s oil & gas project sanctioning in 2020

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COVID-19 and oil price war could derail two-thirds of the world's oil & gas project sanctioning in 2020. Image: Rystad Energy
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The effect of the COVID-19 virus on global demand for oil and gas, along with an ongoing price war that has sent oil prices tumbling at an unprecedented rate, are poised to wreak havoc on new project development plans for this year. According to an impact analysis from Rystad Energy, exploration and production (E&P) companies are likely to reduce project sanctioning by up to $131 billion, or about 68% year-on-year, as they batten down the hatches to weather the storm.

In 2019 total onshore and offshore project sanctioning reached some $192 billion. At the outset of this year, Rystad Energy forecast that projects representing about $190 billion worth of investments would be sanctioned this year. Recent developments, however, have spawned a major revision to that estimate.

If price of Brent crude averages around $30 per barrel in 2020, which we see as an increasingly likely scenario, we estimate that total project sanctioning will be reduced to just $61 billion. Some $30 billion of the overall expenditure is tied to onshore projects and $31 billion to offshore.

“Upstream players will have to take a close look at their cost levels and investment plans to counter the financial impact of lower prices and demand. Companies have already started reducing their annual capital spending for 2020,” says Audun Martinsen, Rystad Energy’s Head of Energy Service Research.

In a $40 per barrel price scenario, which is getting more distant by the day, total sanctioning would still be heavily slashed year-on-year, with Rystad Energy estimating a collective sum of $82 billion, representing a decline of 57%.

In North America, multi-billion dollar oil projects, including LLOG-operated Shenandoah Phase 1 and the Shell-operated Whale development, could face short-term delays in the offshore sector due to low oil prices, while in the onshore sector operators are expected to wait for the situation to stabilize before committing to new projects.

Project sanctioning schedules are expected to face delays of several months – even for those with breakeven requirements of less than $40 per barrel, let alone those with higher costs – as most oil companies will prefer to wait for the spread of Covid-19 to slow down and for the market to start to recover.

Still, one of the major projects this is expected to get sanctioned this year is ExxonMobil’s Greater Liza development off Guyana, which encompasses the Payara and Pacora discoveries.

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Impex

China in action to stabilize foreign investment

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China in action to stabilize foreign investment. Image: Pixabay
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China is ramping up efforts to bolster the stability of foreign investment by promoting work resumption of foreign-funded firms and projects as well as opening wider to foreign investors.

Some 60 percent of major foreign-invested manufacturing firms and over 40 percent of key foreign-funded service providers out of Hubei Province had recovered over 70 percent of work capacity as of March 12, according to the Ministry of Commerce (MOC).

Chinese authorities vowed to further facilitate the work resumption of foreign firms. The National Development and Reform Commission urged efforts to address the difficulties in work resumption to help firms return to full capacity at the earliest possible time and advance major foreign-invested projects, while the MOC stressed measures to enhance firms’ sense of gain.

The country is also beefing up wider opening-up to foreign investment. Revision of the negative list on foreign investment is underway as part of the plan to shorten the negative list and expand the catalog of industries where foreign investment is encouraged.

New editions of the list will probably be released in May, expanding market access of the tertiary sector, such as health care, aged service, finance, transportation, logistics, tourism, education and training and value-added services of telecommunications, said Zhang Fei with the Chinese Academy of International Trade and Economic Cooperation (CAITEC).

China will accelerate the opening of industrial and supply chains with weak links, encourage investment to better meet the needs of domestic consumption upgrade and support firms to invest in the central, western and northeastern regions, said Pang Chaoran, a researcher with the CAITEC.

Zhang also noted foreign enterprises are focusing on opportunities in the industries of biomedicine, public health, artificial intelligence, 5G network and industrial Internet as demands emerged amid the epidemic.

The country will continue improving the business environment and enhancing the stability of foreign investment, said Ye Wei, an official with the MOC.

Foreign-invested companies in China are regaining confidence supported by a string of opening-up measures, despite the impact of the epidemic. Retail giant Costco, for example, has announced to open a second store on the Chinese mainland in Shanghai, while Starbucks will build a coffee innovation park in eastern China’s Jiangsu Province.

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