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DUBAIWeekly Highlights - Domestic Developments- Global Business Developments- Global Economic Developments

July week 1

Economic Research Department

Dubai Chamber of Commerce and Industry

I. Domestic DevelopmentsHealth: mass testing to help contain COVID-19

2Source: ourworldindata, as of July 1

Figure 1 – Adjusted total confirmed COVID-19 cases in the GCC (cases per million person)

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II. Global Business Developments Logistics: impact of COVID-19 on Global Ocean Freight network capacities

Source: Agility, updated on June 26

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II. Global Business Developments Logistics: impact of COVID-19 on Road Freight network capacities

Source: Agility, updated on June 29

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II. Global Business Developments Logistics: impact of COVID-19 on Global Air Freight capacities

Source: Agility, updated on June 25

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II. Global Business Developments Tourism: easing travel restrictions across Advanced Economies

Source: UNWTO

Figure 2 – Easing of travel restrictions in emerging and advanced economies (as of 15 June 2020)

12%

64%

88%

36%

EmergingMarkets

AdvancedEconomies

Have eased travel restrictions Have maintained travel restrictions• As of 15 June 2020, the complete closure of borders isobserved in:

- 75% of destinations of emerging economies (132destinations);

- 21% of destinations of advanced economies (9destinations).

• The partial opening of destinations is observed in:

- 12% of destinations of emerging economies (21destinations);

- 64% of destinations of advanced economies (27destinations).

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II. Global Business Developments Tourism: importance of tourism key behind easing restrictions

Source: UNWTO

86% 84%

74%68%

59%

72%

63%68%

High Considerable Moderate Low

18-May 15-Jun

Figure 3 – Destinations with complete border closure for international tourism, by economic importance of tourism (changes over time)

High: T-GDP >20%

29 destinations: 3 in Africa, 14 in the Americas, 6 in Asia and the pacific, 6 in Europe

Considerable: T-GDP >10% and <=20%

47 destinations: 12 in Africa, 10 in the Americas, 11 in Asia and the Pacific, 10 in Europe, 4 in the Middle East

Moderate:T-GDP >5% and <= 10%

80 destinations: 19 in Africa, 14 in the Americas, 11 in Asia and the Pacific, 28 in Europe and 8 in the Middle East

Low: T-GDP <=5%

25 destinations: 10 in Africa, 5 in the Americas, 4 in Asia and the Pacific, 5 in Europe, 1 in the Middle East

Table 1 – Destination clusters by economic importance of tourism

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II. Global Business Developments Commodities: China’s demand rebound to support prices in Q3-2020

Source: ABN AMRO

WHEAT

SOY

CORNCOFFEEAra

COKING COAL

COPPERIRONORE

NICKEL

ZINC

SUGAR

ALUMINIUM

COCOA

GOLD

SILVER

PLATINUM

PALLADIUM

STEELSCRAP

OIL-BRENT

OIL-WTI

GAS-HHGAS-TTF

STEEL (HRC)

-40%

-20%

0%

20%

40%

60%

80%

100%

-40% -30% -20% -10% 0% 10% 20% 30% 40%

price performance current price level towards end Q3-2020 (forecast ABN AMRO)

his

toric 3

-month

price

perf

orm

ance

price increase sustains

price increase ahead

price pressure ahead

price pressure mounts

Figure 4 – Investors’ sentiment about commodity prices for Q3-2020

• According to ABN AMRO, commodity prices (tracked bythe CRB-Index) have increased by around 6% just lastmonth, supported by a strong improvement in oil prices,as well as China’s demand rebounding from the COVID-19 crisis.

• Influenced by the latest positive industrial data fromChina, investors expect a similar recovery for othereconomies.

• This has stimulated investor risk sentiment.

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III. Global Economic Developments Trade facilitations increasing even with restrictions remaining widespread

Source: WTO

362

132

6587

33

163

27

83

216

397

93

736

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New import-facilitating measures include:- tariff reductions- the elimination of import taxes- the reduction of export duties

Figure 6 – Trade coverage of new import-restrictive measures in G20 economies (USD bn)

Figure 5 – Trade coverage of new import facilitating measures in G20 economies (USD bn)

104 120

3468

1447 32 74

481

336

460418

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800

No

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New import-restrictive measures include:- tariff increases- import bans- stricter customs procedures

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III. Global Economic Developments Economic impact assessment of COVID-19 on global Airlines in 2020

Source: ICAO

International passenger traffic for 2020, compared to baseline (i.e. pre-COVID-19 level):

- Overall reduction ranging from 55% to 67% of seats offered by airlines.

- Overall reduction of 1,194 to 1,457 million passengers.

- Approx. USD 207 to 256 billion potential loss of gross operating revenues of airlines.

Domestic passenger traffic for 2020, compared to baseline:

- Overall reduction ranging from 32% to 42% of seats offered by airlines.

- Overall reduction of 1,150 to 1,524 million passengers.

- Approx. USD 101 to 135 billion potential loss of gross operating revenues of airlines.

International flights Domestic flights