COVID-19 Update: April 17, 2020

The International Monetary Fund, in its 2020 World Economic Outlook, predicts global growth in 2020 to fall to minus 3%. In a press briefing on Tuesday, IMF Chief Economist Gita Gopinath said “This makes the great lockdown the worst recession since the Great Depression, and far worse than the Global Financial Crisis”.
 
Assuming the pandemic fades in the second half of 2020, and that policy actions taken around the world are effective in preventing widespread firm bankruptcies, extended job losses and system-wide financial strains, the IMF projects global growth in 2021 to rebound to 5.8 percent.
 
For the first time since the Great Depression, both advanced economies and emerging and developing economies are in recession. Countries reliant on tourism, travel, and entertainment for their growth are experiencing major disruptions while developing economies face additional challenges: unprecedented reversals in capital flows, major currency pressures, weaker health systems, and much lower fiscal space to support their economies.
 
Gopinath warned that travel restrictions and breakdowns in supply chains threaten to reverse efficiency gains from globalization. Governments' support to businesses and consumers will determine the speed of recovery.

The world is facing an unprecedented threat from the COVID-19 pandemic and many countries are introducing physical distancing measures as one of the ways in which transmission of the disease can be reduced. The application of these measures has resulted in the closure of many businesses, schools and restrictions on travel and social gatherings. Food industry personnel, however, are required to continue to work in their usual workplaces and “keeping all workers in the food production and supply chains healthy and safe is critical to surviving the current pandemic”, according to the World Health Organization.
 
On April 7, the WHO published an interim guidance about coronavirus and food safety: COVID-19 and Food Safety: Guidance for Food Businesses. The document presents measures to protect workers and the integrity of the food chain. “It is imperative for the food industry to reinforce personal hygiene measures and provide refresher training on food hygiene principles to eliminate or reduce the risk of food surfaces and food packaging materials becoming contaminated with the virus from food workers”, the organization says.
 
Likewise, on April 8, the European Commission published a Q+A on COVID-19 and food safety covering food production, food in shops and food at home. Even where the lockdown may affect the modalities of official controls[1], it does not affect the safety of food produced. The existing legislation minimizes the risk of virus particles coming into contact with foodstuffs since every person working in a food-handling area must maintain a high degree of personal hygiene including wearing suitable, clean and, where necessary, protective clothing and constantly apply good hygiene practices (regular handwashing, no unhygienic behaviors allowed such as sneezing or coughing when producing or handling food, etc.).

The FAO has launched a platform for countries to share what they are doing to mitigate the impact of the COVID-19 pandemic, and rapidly search for ideas from their peers. The Food and Agriculture Policy Decision Analysis (FAPDA) is presented as an easy-to-use free platform for countries to share what they are doing and rapidly search for ideas –a global library with detailed information on how different countries are trying to keep their supply chains moving amid the disruptions caused by travel and other health restrictions. "There are a lot of trade-offs to consider, but this tool can help countries make them wisely and contribute to expediting the establishment of holistic and inclusive policy frameworks," says Lorenzo Bellù, FAO Senior Economist. 

According to a recent GAIN Report, due to the fear of potential food shortages, consumers raced to stock up. Nielsen reported that compared to the same period a year ago, grocery and convenience store sales in Belgium and France increased 37 and 30%, respectively, during March 16-23. Despite logistical challenges along the food supply chain, farmers, transporters, and grocery retailers have been largely successful in keeping the shelves stocked and stores open. While it is difficult to generalize consumer behavior and market developments across all 27 EU Member States, looking ahead, price volatility remains a concern.
 
According to the report dated April 3, most European borders were free of major slowdowns, but outside of the Schengen Area, in Bulgaria and Romania, slow-downs persisted. The European Fresh Produce Association, FRESHFEL, alerted officials to the need to secure seasonal workers and their ability to move to places where there is a need. On April 8, FRESHFEL reported that the availability of seasonal workers was still insufficient in many places and the logistics costs in the chain had increased by 20-30% due to empty returns of trucks and longer journey times.
 
The EU exemptions for seasonal agricultural labor published in the Guidelines of March 30 may help, but another challenge awaits growers and suppliers: the collapse in demand from the hospitality and restaurant sectors.
 
The proposal for a Coronavirus Response Investment Initiative was approved by the European Parliament and the Council and is in force as of April 1. This will allow the use of €37 billion under cohesion policy to address the emerging needs in the most exposed sectors, such as healthcare, SMEs and labor markets. In addition, the EU Solidarity Fund will provide additional assistance of up to €800 million to the hardest hit Member States in order to alleviate the financial burden of the immediate response measures.
 
The European Council, in its statement of March 26, entrusted the Eurogroup with developing proposals for the economic response to the severe social and economic disruption caused by the
COVID-19. On April 10, the president of the Eurogroup, Mario Centeno submitted a comprehensive economic policy strategy response to the COVID-19 pandemic to the European Council. The proposal, adopted by the Council on April 14, consists of three safety nets –one for workers, one for businesses, SMEs in particular, and another one for countries– and a Recovery Fund. The three new EU safety nets add up to around half a trillion euros.
 

In Italy, as a result of the Decree of The Council of Ministers, DPCM of April 10, all measures to counteract the COVID-19 emergency have been extended until May 3, 2020, including those forbidding people from moving or travelling. The list of businesses open include hypermarkets, supermarkets, convenience stores and retail sale of food in specialized stores, among others. All citizens are required to leave home only for work, absolute emergencies or health reasons.

Spanish president, Pedro Sánchez extended the state of emergency decreed on 14 March by a further two weeks until April 26. However, from April 10, non-essential workers such as factory and construction personnel are allowed to resume their jobs after a two-week ban. The agri-food sector, which is considered an essential activity, was allowed to continue working during the ban.
 
In addition, on April 7, the Spanish government approved urgent measures to foster temporary employment in the agricultural sector. The aim of the Royal Decree-Law 13/2020 is to ensure that enough workers are available to carry out seasonal work in the countryside, guarantee the supply of fresh products and avoid price hikes. The Minister for Agriculture, Fisheries and Food estimates that between 75,000 and 80,000 workers are needed.

The Federation of the Food and Drink Industry of Belgium, FEVIA, reported from a survey of its 200 members that 60% of food companies were experiencing increased absenteeism and reduced staffing was having an impact on production at 39% of FEVIA members’ operations. According to a more recent survey, many companies confirmed that they were badly affected. About three-quarters of food companies reported that their turnover had decreased. For 48% of companies, this was a drop in turnover of more than 50%; for 28% of them, a drop of more than 75%. Half of the food businesses were facing liquidity problems, often due to late payments. Only 6 out of 10 food companies could ensure the continuity of their activities in the short term.

Amid the COVID-19 outbreak, the U.S. Food and Drug Administration is providing food suppliers, manufacturers and restaurants with more flexibility. The Agency has released new temporary guidelines providing flexibility regarding menu labeling requirements, nutrition labeling requirements of certain packaged food, and preventive controls and Foreign Supplier Verification Programs for Importers of Food for Humans and Animals (FSVP).
 

 
In addition, the FDA will begin requesting that importers send records required under the FSVP rule electronically (or through other prompt means) to the Agency as it shifts to conducting these inspections remotely during the COVID-19 public health emergency.
 

According to China Daily, China will establish 46 pilot zones for cross-border e-commerce to promote stable development of foreign trade. In addition, the country has launched a series of measures, including optimizing export tax rebate (exemption) services, increasing credit support, issuing force majeure factual certificates, and implementing more favorable import taxation policies, in order to stabilize foreign trade and investment. China's imports and exports totaled 4.12 trillion yuan ($590 billion) in the first two months of this year, down by 9.6% year-on-year, according to statistics from the General Administration of Customs.
 
Bloomberg has reported that exports and imports are not as bad as expected and the domestic economy looks to be improving in April. Shipments to South Korea, Singapore and Taiwan rose, while those to Japan only fell 1.4%. But much of that trade is of electronic components for goods which are exported elsewhere, so the shutdowns, job losses and social distancing in other parts of the world will likely affect that in the future. Trade with Europe and the US was hit much harder, with exports to the European Union down more than 24%, and those to the US falling almost 21% from a year ago.

According to a GAIN Report of April 9, ports in India are operating with minimal workforce. The Kandla International Container Terminal declared force majeure as of March 22 where it will not be responsible for any claims, damages, and charges including vessel demurrages or issues arising from lower load/discharge rates. The Kandla region has declared a complete halt of all road traffic from 11:00 am until 5:00 pm. As a result, port employees have had to shift their work schedules. Customs agents are experiencing difficulties in reaching the port and urging the state government to lift movement restrictions to anyone connected with port operations.
 
The port of Mumbai continues to experience massive backlog due to the lack of administrative personnel, truck drivers, and crane operators. Global container shipping lines have started to skip Jawaharlal Nehru Port Trust and Mundra Port because import/export clearances are not occurring fast enough.
 
According to local reports, the lack of truck drivers has resulted in +50,000 uncleared sea containers at the ports of Chennai, Kamajarar and Kattupalli.
 

Chile has announced new measures related to phytosanitary certificates in order to facilitate trade. Through this URL, national plant protection organizations will be able to verify and obtain directly from the SAG certification system an image of all original data in the phytosanitary certificate, so as to guarantee the authenticity of any copies that processing entities submit from their respective countries (a scanned image, a photo or any other copy of the original phytosanitary certificate), with only the corresponding phytosanitary certificate number being required.

On April 14, the Australian Macadamia Society, AMS, published a number of updates about the Land Restoration Fund, government support for air freight, border crossings, travel restrictions, PPE (personal protective equipment) supply and work visas.
 
The Australian Government is providing support to the agriculture and seafood sector to deal with current air freight constraints. This includes $110 million to ensure air freight capacity remains open for critical markets, including horticulture.
 
Safe Food Production Queensland has developed a guideline for agricultural, horticultural, and meat and livestock processing businesses to help them reduce the impact of COVID-19 to the workforce.

According to a recent GAIN Report, the Crisis Management Committee of the Ministry of Public Health of Qatar has exempted all food and medical products from customs duties for six months.

Good nutrition is crucial for health, particularly in times when the immune system might need to fight back.
 
The World Health Organization (WHO) has published some nutrition advice for adults during the COVID-19 outbreak. Among others, these recommendations include: eating more unsaturated fats, such as nuts, versus saturated or trans fats; and eating more fresh and unprocessed foods such as fruits, vegetables, nuts, legumes, whole grains and foods from animal sources (e.g. milk, eggs, fish and meat). As for dried fruits, the WHO emphasizes the importance of choosing products without added salt or sugar.
 
In the same vein, a recent study[2] published in the European Journal of Clinical Nutrition, establishes some nutritional recommendations for the quarantine. The study observed that foods supplying micronutrients may help boost the immune function. This happens because some of these micronutrients, such as vitamin E, vitamin C and beta-carotene, are antioxidants. Antioxidants may help prevent or slow the damage of the cells. Another essential trace element that is crucial for the maintenance of immune function is zinc. And nuts are one of the major dietary sources of vitamin E and zinc.
 
The researchers conclude that keeping foods that are good sources of immuno-supportive nutrients, planning times to eat, meals, portions and having a cutoff time for eating but mostly having in mind positive attitudes could be helpful to tackle the negative health effects of quarantine.
 

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