3rd February 2021 - Wilson James

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      3rd February 2021

HIGHLIGHTS
        Worldwide cases of COVID-19 are at 103,997,587 with deaths numbering 2,249,611 as of 2 February
         according to Worldometer. 75,843,071 people have so far recovered from the virus.
        A new single dose vaccine, shown to be 66% effective offering complete protection from
         hospitalisation and death. The manufacturer, Janssen owned by Johnson and Johnson is aiming to
         produce 100m doses this year. The UK has ordered 30m doses. Lab tests have shown however that the
         new vaccine is less effective against the South African strain of the virus.
        Quarantine rules have been further strengthen by the Home Office. British citizens arriving from 30
         countries including Brazil and South Africa will now have to quarantine at an airport hotel at their own
         expense. In certain circumstances, financial assistance will be available.
        The UK has placed a ban on all direct flights arriving from the UAE, up until this point the route from
         Heathrow to Dubai (DXB) had been the busiest route in the world during the pandemic.
        Germany are threatening to take legal action against Vaccine manufacturers. Tensions have grown
         between EU leaders and vaccine manufacturer AstraZeneca because they have not kept up with the
         number of doses promised to EU member states. The company have said they can only deliver a
         quarter of the doses originally ordered for Quarter One due to manufacturing issues.
        Transport Secretary Rt Hon Grant Shapps has announced that the government’s Airport Support
         Scheme is now live. Commercial airports and ground handling companies will be able to apply and
         receive up to £8m each to support with fixed costs while travel restrictions remain in place.
        Captain Sir Tom Moore who had been suffering from pneumonia for some time, died yesterday
         evening, he had tested positive for COVID-19 only last week. Captain Sir Tom Moore was a national
         hero who raised over 32m for the health service by walking 100 laps of his garden last year.

  BREXIT
        The government have reversed their decision to review employee rights in the UK. The Rt hon Kwasi
         Kwarteng, who was appointed Secretary of State for Business, Energy and Industrial Strategy in early
         January has stated that he wants to improve the rights for British Workers post leaving the EU.
        The Cabinet Office has announced food waste estimated equal to 142,000 tons could accumulate over
         the next 6 months due to disruption at borders. The extra customs checks have meant Lorries are in
         ports for days resulting in perishable items spoiling.
        On 29 January the EU proposed invoking article 16 of the Northern Ireland Protocol that allows parts
         of the UK/EU Brexit deal to be over ridden. The EU later backtracked on the proposal. The EU has
         introduced controls on the export of Covid-19 vaccines manufactured within the bloc. Had article 16
         been invoked supplies of EU manufactured vaccines to Northern Ireland would be reduced. The
         Northern Ireland Protocol is an agreement between the EU and the UK to prevent the emergence of a
         hard border between the Republic of Ireland and Northern Ireland.
        Northern Ireland has seen a recent rise in sectarian ‘menacing behaviour’ at its Belfast and Larne ports.
         There is growing discontent in the loyalist community over Brexit and the Northern Irish border with
         graffiti appearing describing staff as targets.

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WORLD NEWS/RAS/3rd February 2021

COVID – 19

      TOTAL CONFIRMED CASES                         TOTAL DEATHS                PATIENTS RECOVERED
               3,835,783                             106,564                         1,767,972

      02.02.2021 Worldometer

      COVID-19 – UK

   Upper Tier Local Authority by cases 27/01/2021         Upper Tier Local Authority by cases 02/02/2021

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WORLD NEWS/RAS/3rd February 2021

Patients weekly admission data as of 28/01/2021

        The total confirmed UK Covid-19 cases as of 2 February is 3,835,783 with 106,564 deaths according to
         GOV.UK.

        9,296,367 people have received their first dose of Covid-19 vaccination in the UK and 494,209 have
         received their second dose. GOV.UK

        The UK banned all direct flights from the UAE on 29 January due to concerns over the spread of the
         more contagious and potentially vaccine-resistant Covid-19 variant from South Africa.

        Eleven people have tested positive for the South African Covid-19 variant in different regions in
         England, none of whom has any links to people who have travelled. To contain the new outbreaks,
         there will be mass testing of residents in the areas whether or not they are showing symptoms.

        Wales has announced where people were told to self-isolate by the NHS Covid-19 phone app can now
         apply for a £500 payment, previously only those on low incomes could apply for the payment.

    COVID-19- OTHER COUNTRIES

    Canada
    All major Canadian airlines have cancelled flights to Mexico and the Caribbean for three months in order to
    control imported strains of Covid-19. There are fears over a shortfall in vaccine doses after Prime Minister
    Justin Trudeau said that the next shipment from Moderna would contain a quarter less doses than expected.

    France
    On Sunday 31 January, France closed its borders to all countries outside the EU with an exception given to
    those with compelling reasons. Anybody entering the country from a member EU state must provide a
    negative PCR test. French prime minister Jean Castex has acknowledged that the countries Covid situation is
    worrying but hopes that measures such as border closures will prevent a third national lockdown.

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WORLD NEWS/RAS/3rd February 2021

COVID-19- OTHER COUNTRIES

    Germany
    Germany’s vaccine committee said that the AstraZeneca vaccine should not be given to anyone over the age
    of 65 due to fears of its efficacy. Within 24 hours of Germany making the announcement, The European
    Medicines Agency dismissed Germany’s claim and declared the vaccine safe to administer to any age group.

    Iran
    State run vaccine manufacturer Setad has conducted tests on blood samples from volunteers who received
    two doses of the locally produced vaccine COVIran Barekat. The results have shown that the vaccine is
    effective against the UK variant of the virus.

    Japan
    Japan is the last major economy to commence vaccinating its population with the first round of inoculations
    not due to start until the end of February. There is speculation, the already postponed Olympic Games will
    have to be cancelled completely.

    Myanmar
    The country’s military have taken power in a coup against the National League for Democracy party (NLD)
    arresting de facto leader Aung San Suu Kyi and other senior politicians. The Military is claiming voter fraud in
    last November’s election and quotes a section of the constitution allowing armed forces to take control in
    the event of a national emergency. The move received global condemnation.

    Portugal
    Data from the Portuguese Health Ministry has shown that 843 out of 850 ICU beds allocated to Covid-19
    cases on the mainland are occupied. The steep rise in daily deaths has resulted in the government using
    refrigerated trucks as make shift morgues due to funeral homes being at capacity.

    United States of America
    The FDA has warned against the use of hand sanitiser originating from Mexico. Regulators have advised that
    half of all alcohol-based hand sanitisers contain methanol and not ethanol as advertised. Methanol can be
    toxic if ingested or absorbed through the skin. 84% of hand sanitisers from Mexico do not meet FDA standards
    during tests that took place between April and December 2020.

      Useful Information Sources
               UK wide – Public Health England
               Scotland – Scottish Government
               Northern Ireland – NISRA
               Covid-19 deaths in England & Wales – ONS
               Covid-19 Statistics – Worldometer – Johns Hopkins University

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WORLD NEWS/RAS/3rd February 2021

WORLD NEWS
     Canada
     Canadian security firm Garda World has increased its takeover bid for British firm G4S despite a bid by
     American operator Allied Universal already being accepted. It is the fifth time the Canadian company has
     made a bid for G4S. Shareholders are yet to vote on the proposed takeover.

    China
    Hong Kong based airline Cathay Pacific is to cut capacity a further 60%. The airline carried 86.9% less
    passengers in 2020 compared to the previous year. The airline expects to burn US$245m per month if strict
    quarantine measures for aircrew are enforced.

    Democratic Republic of Congo
    Prime Minister Sylvestre Ilunga Ilunkamba has resigned after a vote of no confidence. The resignation
    enables President Tshisekedi to choose his own Prime Minister, supported by a new parliamentary majority.
    The vote of no confidence will result in the continuation of the power struggle in the country.

     Italy
     Italy’s Foreign Minister Luigi Di Maio has halted the sale of thousands of missiles to Saudi Arabia and the
     UAE. The cessation of arms sales has been a result of both Gulf States involvement in the Yemeni conflict.
     Former Prime Minister Matteo Renzi agreed the deal worth €400m in 2016.

     Republic of Ireland
     Low cost airline Norwegian Air Shuttle has applied to the High Court of Ireland to end the lease deals of 36
     aircraft (carrying Irish registration marks). Lawyers representing leasing companies claim the airline has not
     given enough evidence to justify ending the agreement early. The move is part of measures to raise €500m.
     Other measures include the termination of long haul operations from London Gatwick,

    Nigeria
    A court in The Hague has ordered the Nigerian subsidiary of Shell to pay compensation to farmers affected
    by two oil spills in the Niger Delta between 2004 and 2007. The spills, which polluted an area the size 60
    football pitches, were the result of leaking oil pipes.

    Poland
    An estimated 400,000 people have taken part in protests over a court ruling to ban abortion. The near total
    ban will exclude cases where rape or incest have been involved. Supporters of the ruling have insisted that
    there will be more government support available for mothers who give birth to disabled and sick children.

     Sao Tome and Principe
     15 seamen have been kidnapped and 1 killed after pirates attacked the MV Mozart in the Gulf of Guinea.
     The Liberian registered vessel was sailing from Cape Town to Lagos, the whereabouts of the kidnapped has
     not yet been established.

     Singapore
     A 16-year-old boy was arrested for allegedly planning attacks on two of the City States Mosques to coincide
     with the anniversary of the Mosque Attacks in New Zealand. The 16 year old who remains unnamed is the
     first person arrested in the country for being “inspired by far right extremist ideology”.

     United Kingdom
     The UK government announced on 27 January that it was making grants available to businesses in an effort
     to push for greener technology in the UK aviation sector. The £84m fund could secure 4750 design,
     engineering and manufacturing jobs making zero emission flights a possibility by 2023.
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WORLD NEWS/RAS/3rd February 2021

New research shows 2020 was the highest year on record for scams in the UK. Investment and
     impersonations scams made up 60% of the reports equally. Follow this link for the latest scam advice.

     United States of America
     US President Joe Biden has appointed John Kerry as the US Special Envoy on climate change. Mr Kerry
     brokered and signed the Paris Climate Agreement on behalf of the US under the Obama administration. Mr
     Kerry has accused the Trump administration of misleading the American people on its reasons for
     withdrawing from the Paris agreement. The United States re-joined the Paris Climate Agreement the day
     after US President Joe Biden took office. The Biden administration intends to reverse a number of policies
     made during the Trump presidency.

     The Wall Street Journal is reporting oil giants Exxon and Chevron discussed the possibility of a merger last
     year in response to the pandemic negatively impacting oil prices. Together the 2 companies would have a
     combined worth of more than USD 350 billion, making them the 2 nd largest oil company in the world.

   INSIGHTS
   Our Risk Advisory Service regularly publish articles and advisories covering a myriad of subjects. These
   publications can be found within our Insights section on our Risk Advisory Service website.

   External factors challenging the aerospace and defence sectors

   The commercial aerospace industry has always been volatile. Tight profit margins and competition mean that only those
   with the correct business model can turn a profit.

   There are many external factors outside of an airline company’s control that can see them lose business. Airlines generally
   use hedge pricing to procure fuel, agreeing to buy future supplies at a set price by predicting the price of oil. On 2 August
   1990, Iraq invaded Kuwait. Prior to the invasion of Kuwait, oil was trading at USD21 per barrel, Within two months, the
   price of oil had more than doubled to USD 46 per barrel. In 1992, the combined loss to the profit of global airlines was
   USD 4.8bn, made up of a combination of fuel prices and the lack of demand for travel.

   The attacks on the Twin Towers and the Pentagon by Al-Qaeda in September 2011 using hijacked aircraft as their weapons
   led to America immediately closing their airspace. Any airborne aircraft was instructed to land as soon as possible or
   return to their airport of origin. The effect of 9-11 was devastating for airlines due to an overnight decline in demand,
   especially by American travellers, many of whom were fearful about flying. Airlines faced the enormous task of boosting
   customer confidence. Losses were compounded as airlines had the additional cost of introducing enhanced security
   measures such as ballistic-proof cockpit doors. 9-11 cost the industry 62,000 jobs and it took six years for passenger levels
   to return to their original levels. Combined losses to airlines globally were more than USD 35bn post 9-111.

   The 11 September attacks were a shake-up for commercial aerospace and defence; airlines realised that they needed to
   be leaner and stronger should another crisis hit the industry. Post 9-11, the industry has had to weather the storms of
   the SARS crisis, the 2008 global financial crisis and more recently the volcanic ash cloud affecting flights when
   Eyjafjallajökull erupted in Iceland. It is not yet known what the ultimate cost on the industry will be from the Covid-19
   pandemic, or when passenger numbers will return to what they were in 2019. An IATA (International Air Transport
   Association) report suggests that the total loss for the industry for 2020 is estimated to be USD 118bn and USD 40bn for
   2021. American Airlines has announced 19,000 redundancies due to the slump2 and the total number of job losses from
   airlines is estimated to be 1.3million. Aircraft manufacturers and suppliers are also affected; Derby-based engine
   manufacturer Rolls Royce expects £2bn loss for 2020/21 coupled with the loss of 9,000 jobs.

   The current crisis will see commercial aerospace and the way we travel reshaped. Analysts are doubtful of seeing the
   volume of double-decker Airbus A380s restored in our skies and Qatar Airways has announced they are to half their fleet
   of the aircraft.

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WORLD NEWS/RAS/3rd February 2021

COVID19@wilsonjames.co.uk / riskadvisory@wilsonjames.co.uk

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