Coronavirus: Digest of business-focussed articles from national and international media, selected by George Hamilton. Some may require a subscription to obtain the full version (paywall)
Headlines in the issue:
- Possible world-wide drug shortages
- Jaguar Land Rover runs out of parts
- Business warned to flag up virus problems in annual reports
Is the world closing its doors to China?
These first 3 stories, from the Daily Telegraph 18 Feb, are all at:
Europe braces for coronavirus-induced drug shortages
Europe, the US and India have all flagged possible drug shortages following China’s coronavirus outbreak.
China produces around 80 per cent of the raw materials used in India’s medicines, but with the country currently in the grip of an epidemic, production has slowed and stockpiles are running low.
As a result, prices of common drugs in India have skyrocketed due to disruptions causes by the outbreak. The price of paracetamol has jumped up by 40 per cent and common antibiotics by 70 per cent.
Jaguar Land Rover warns of UK production hit as it runs out of parts
Jaguar Land Rover has been flying Chinese parts in suitcases to Britain in order to maintain production and could run out after two weeks, as the impact of the coronavirus outbreak hits firms and industries across the globe.
The boss of the company, Sir Ralf Speth, said the company had enough parts to complete the manufacturing processes at its UK sites this week and next but warned of shortfalls from March should delays to deliveries persist.
Britain’s biggest car maker joined major global companies, such as Apple, in warning of the impact of the virus on supply chains, Reuters reports.
UK firms must outline coronavirus business risks
British firms must flag up the full extent of the risks posed by the coronavirus outbreak to their businesses in forthcoming annual reports, the Press Association reports.
The Financial Reporting Council (FRC) said companies have a duty to make “up-to-date and meaningful” disclosures to investors on the potential impact of the disease.
The FRC is also in talks with accountancy firms over the potential effect that coronavirus could have on their ability to sign off accounts, given travel restrictions in China.
UK firms with Chinese subsidiaries can only review audit files within the country, as Chinese data protection laws prevent this being done remotely.
An FRC spokesman said: “Given the potential for rapid spreading of the virus, required disclosures will likely change over time as more information about the epidemic emerges.
“Companies will need to monitor developments and ensure they are providing up-to-date and meaningful disclosures to their shareholders when preparing their year-end reports.”
Apple cuts revenue forecast as coronavirus wreaks havoc on its Chinese supply chain
Apple has warned investors that it will miss its revenue forecast for this spring due to the devastating impact of coronavirus on the Chinese economy.
The company had previously said that it expected to report net sales of between $63bn (£48bn) and $67bn in the three months ending this June, a wider than usual range that it blamed on “uncertainty “over the epidemic.
But late on Monday, in a letter to investors, Apple admitted that it would miss even those targets because the disease had strangled the supply of new iPhones and crushed customer demand as it forced the company to shut down factories and closed high street shops.
It is the second time in the last 13 months that Apple has had to cut its forecasts due to problems in China, where it makes most of its products and more than one tenth of its revenue. The company did not give any new predicted numbers.
Daily Telegraph 17 Feb
Amid Coronavirus, the World Closes Its Doors to China: ‘I Feel So Isolated’
SHANGHAI—To celebrate Christmas one year, Jing Sun trekked to the North Pole to see reindeer. For another holiday, the Shenzhen native flew to Marrakesh, and she was recently in Cleveland for work. Los Angeles, New York and Barcelona were on her spring itinerary, while her maiden Australia voyage was penciled in.
Suddenly, the 29-year-old is grounded in Beijing.
Fearing the contagious coronavirus, the world has severed many links to China.
Watching the drawbridges go up is a jolt to China’s masses of travelers, including families on holiday, students studying abroad, globe-trotting lawyers, financiers and art dealers, such as Ms. Sun. Their livelihoods are impacted, and egos bruised.
The checks on its people undermine core Chinese government ambitions to position the country at the center of global diplomacy, commerce and culture. They threaten its export deals, convention business and efforts to position its modern airports as global transit points.
The international community’s defensive posture also stands in contrast to assurances from Beijing that the coronavirus is under control. The measures represent some of the few points of leverage many countries still have with China.
Wall Street Journal 18 Feb