1
DUBAIWeekly Highlights - Domestic Developments- Global Business Developments- Global Economic Developments
June, Week 3
Economic Research Department
Dubai Chamber of Commerce and Industry
I. Domestic DevelopmentsHealth: 1 in 4 UAE residents tested for COVID-19
2Source: DCCI, worldometers, as of June 17, 2020
Figure 1 – Individual COVID-19 tests performed by country Adjusted (tests per 100 thousand person) – by rank
5,875 6,004
6,311 6,322
6,579 6,977
7,367 7,463
7,766 7,775 7,833 7,970 8,049
9,114 9,852 9,871
10,286 10,323
10,702 10,745 10,835
11,840 13,791
14,215 15,954
18,525 18,683
19,038 25,794
26,564
- 5,000 10,000 15,000 20,000 25,000
CanadaAustria
KazakhstanNew Zealand
MaldivesLatvia
AustraliaEstonia
ItalyUSA
IrelandKuwaitBelarus
BelgiumSingapore
PortugalUK
SpainQatar
RussiaMauritius
CyprusLithuaniaDenmark
San MarinoIceland
LuxembourgMalta
BahrainUAE
I. Domestic DevelopmentsHealth: mass testing to help contain COVID-19
3Source: ourworldindata, as of June 17, 2020
Figure 2 – Adjusted total confirmed COVID-19 cases in the GCC (cases per million person)
4Source: Emirates SkyCargo
Figure 3 – Emirates SkyCargo operational cargo network – as of April 9th
I. Domestic DevelopmentsEmirates SkyCargo scales up network: 51 destinations in April
I. Domestic DevelopmentsEmirates SkyCargo scales up network: 83 destinations in June
5Source: Emirates SkyCargo
Figure 4 – Emirates SkyCargo operational cargo network – as of June 9th
6
II. Global Business Developments China: luxury retail segment showing strong recovery
• Several luxury goods companies reported an uptick in China aspeople emerged from weeks of lockdowns, spurring what theindustry refers to as "revenge spending“.
• According to industry analysts, 2/3 of luxury purchases madeby Chinese shoppers typically happen outside China.
• Chinese customers may be spending more money on luxurygoods at home because they are not able to travel at themoment.
• Aside from the luxury retail segment, overall retailing activitycontinued declining in May (see slide 10).
Source: CNN
“Tiffany this week pointed to China as a bright spot for its jewelry business, saying that retail sales surged around 30% in April and 90% in May compared to the same months last year.”
“Burberry said last month that sales of its clothing, bags and accessories in China were already ahead of the prior year, and continuing to show an improving trend."
“Swiss jewelry and watchmaker Richemont has pointed to China as a bright spot in recent weeks, reporting "strong demand" in a results announcement last month since its 462 boutiques in the country opened back up.”
7
II. Global Business Developments Travel: slow return to international travel expected
Source: IATA
Figure 5 – Returning to travel after containment announcement
22%
45%
23%
7%
3%
14%
47%
28%
8%
4%
12%
33%36%
14%
5%
Not wait at all Wait 1-2 months Wait 6 months or so wait 1 year or so Not travel for theforseable future
February survey April survey May survey
8
III. Global Economic Developments China: the factory-led recovery continues
Source: National Bureau of Statistics of China
Figure 6: China’s industrial production in May 2020 (y-o-y % change)
5.0%
6.3%
4.8% 4.4%
5.8%4.7%
6.2%6.9%
-13.5%
-1.1%
3.9%4.4%
-15%
-10%
-5%
0%
5%
10%
May-19 Jun-19 Jul-19 Aug-19 Sep-19 Oct-19 Nov-19 Dec-19 Jan-Feb 20
Mar-20 Apr-20 May-20
• In the month of May, China’s industrial production increasedby 4.4% y-o-y, versus a median estimate of a 5.0% expansion.The value added per category changed as follows:
- Mining industry increased by 1.1% y-o-y, up 0.8% m-o-m;
- Manufacturing industry increased by 5.2% y-o-y, and by0.2% m-o-m; driven by ”equipment manufacturing” and“high-tech manufacturing”
- The production and distribution of electricity, heating, gasand water increased by 3.6% y-o-y, and 3.4% m-o-m.
9
III. Global Economic Developments China: retail activity improving, but overall still lagging
Figure 7: China’s retail sales in May 2020 (y-o-y % change)
• Retail sales were down 2.8% y-o-y in May, compared to aprojected 2.3% decrease.
• Moreover, over the period Jan-May 2020 fixed-assetinvestment in China declined 6.3% y-o-y; against a forecast 6%decrease.
• This latest data release indicates that China’s gradual recoveryin is still mainly driven by the supply side, supported bygovernment stimulus, while demand remains fragile.
Source: National Bureau of Statistics of China
8.6%9.8%
7.6% 7.5% 7.8% 7.2%8.0% 8.0%
-20.5%
-15.8%
-7.5%
-2.8%
-25%
-20%
-15%
-10%
-5%
0%
5%
10%
15%
May-19 Jun-19 Jul-19 Aug-19 Sep-19 Oct-19 Nov-19 Dec-19 Jan-Feb 20
Mar-20 Apr-20 May-20
10
III. Global Economic Developments The global outlook remains uncertain
Figure 8 – Projected change in GDP in 2020 (% y-o-y change)
Source: OECD June 2020 economic Outlook
-11.4% -11.3% -11.5%
-9.1%-8.0%
-6.6% -7.3%-6.0% -6.0%
-14.1% -14.0% -14.0%
-11.5%
-9.4%-8.8% -8.5%
-7.6% -7.3%
-16%
-14%
-12%
-10%
-8%
-6%
-4%
-2%
0%
France Italy UK Euro Area Canada Germany USA World Japan
Single-hit scenario Double-hit scenario
