Global Business Daily: Stimulus plans, Netflix boom, Gulf row spreads
Patrick Atack in London
Europe;

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"I find it essential that the European Council... come up with a convincing package."

That's European Central Bank policymaker Olli Rehn, who is also the governor of the central bank of Finland. He was speaking ahead of the meeting of European leaders to agree on a bloc-wide recovery plan, widely referred to as a "second Marshall Plan." 

It's also Earth Day, hence today's cover picture. Although there's a lot going on in the world, we think it's important to mark the day – if you've seen examples of businesses or institutions celebrating our planet today, do drop us a message at europedigital@cgtn.com – I'd love to see them! 

In more pandemic news, the U.S. and South Korea have both updated their coronavirus stimulus packages, with billions more now aimed at supporting smaller businesses. 

South Africa has also joined the pack, with $26 billion in fiscal aid and the nation's first ever application for IMF funds. 

Talking of stimulus, have you been wondering where all these funds are going? In today's graph we look at the companies in Germany claiming state funds and, where possible, show how much they're getting. 

In better news, Netflix has posted a 23 percent growth in viewers – perhaps unsurprisingly, as the majority of us are stuck inside for most of the day. There was more of a shock in the fashion world, where Bottega Veneta actually gained ground in the first three months of the year. 

Happy reading, 

Patrick Atack

Digital business correspondent 

P.S. Did you know we send this briefing by email, too? You can sign up to receive it here.

Politicians in the U.S. have agreed a $484 billion stimulus package, with at least $300 billion destined for small businesses, which lost out on the initial stimulus fund – with larger and publicly listed firms receiving the loans instead. 

South Africa has unveiled its $26 billion coronavirus recovery package, which includes the country's first ever application to the International Monetary Fund for fiscal assistance. The funds will support current welfare payments, and offer support to businesses. 

South Korean president Moon Jae-In has warned of a severe economic downturn, saying "a hiring freeze together with a corporate crisis is looming." He said a further $70 billion has been made available to those struggling financially. The South Korean recovery stimulus injection is now worth almost $200 billion. 

Irish finance minister Paschal Donohoe warned the country expects record levels of unemployment due to COVID-19 layoffs. He said GDP may drop by at least 10 percent, while the jobless count is likely to hit 22 percent by the summer

The CEO of Swiss diagnostics and laboratory firm Roche, Severin Schwan, said nations such as Germany and Singapore, which have invested in healthcare infrastructure in recent years, "now have a huge advantage" against COVID-19, while "other countries that underinvested in healthcare infrastructure… now it shows."

Facebook has taken a $5.7 billion stake in leading Indian telecoms firm Reliance Jio. It represents 10 percent of the Indian business, which, while heavily in debt, boasts 388 million users in the billion-strong population. 

Embattled airline United has raised more than $1 billion in a sale of 14 percent of the firm's recently expanded total shares. The move came less than a week after it agreed to a bailout of $1.5 billion from the U.S. government, with an interest rate of only one percent. 

Lululemon, the Canadian company famous for yoga and gym wear, has apologized for an "inappropriate and inexcusable" social media post by an employee, which alluded to the theory that COVID-19 was spread to humans after someone ate a bat. It caused widespread anger in China because it was seen as racist. 

The 2017 dispute in the Gulf, which led to Saudi Arabia and its allies cutting Qatar out of regional trade, has spread to the English Premier League, after Qatari broadcaster BeIN sent letters to the football organization requesting it block the purchase of Newcastle United by a group including the Saudi Public Investment Fund. 

Kerring, the fashion group that owns Bottega Veneta, Gucci, and Yves Saint Laurent among other brands, has suffered a 17 percent drop in overall revenues from January to March. Bottega Veneta showed "remarkable" gains, though sales were focused heavily in North America, while Gucci revenues fell by more than 23 percent. 

Netflix has proved it's one of the companies not suffering like some amid the pandemic, as its first-quarter results revealed a 27 percent hike in revenues and a nearly 23 percent growth in global audience "due to home confinement." The streaming service warned growth may not continue, though, as production of entertainment is generally on hold. 

 

The UK's pubs, bars and restaurants have had to adapt to survive during lockdown but customer demand remains high and the boss of Burger King says it is planning to slowly reopen branches, led by drive-thru outlets.

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Luke Piper, an accountant who is helping businesses to apply for furlough payouts via the Coronavirus Job Retention Scheme, spoke to CGTN Europe about the process of doing so and how it will help small firms.

 

What has been your experience of applying for the scheme on behalf of your clients? 

We do approximately 400 to 500 different payrolls a month, as well as service another thousand clients who will want some help. So, this morning we've made approximately 10 to 20 claims so far. And those are for the clients that are in desperate need, those needing the cash flow into their business ASAP. And, actually, as much as I was a skeptic about [UK revenue authorities] and their computer system, so far it has been relatively painless.  

It's been quite a simple upload system and it hasn't been too onerous. It's the background stuff, though, that's a little bit more painful and the background being the calculations of the furlough; when they started and went on the furlough leave, and have they actually met all the criteria, and those things are taking a little bit of time. 

 

Is it likely to help the majority of small and medium businesses nationwide? And do you think it's going to help them survive the crisis? 

Any financial support is going to help any business survive. Ultimately, cash in the bank is what keeps a business afloat. It's not necessarily how much money they're making, it's what they've got in reserve to weather the storm and things like this. 

I specialize in tax planning and helping businesses be as efficient as possible. And one thing we always talk about is planning for things in the future that we might not be able to predict. Not once have I ever talked to a client about planning for a pandemic across the world. So these are absolutely, as we all know, unprecedented [situations]. But those businesses that have the most cash in the bank available to them are going to survive the longest. 

So, at the moment, we're talking to clients about getting some of the business interruption loans that the government has issued, and anything that helps out with the workforce, such as 80 percent furlough [which] is massively going to help businesses survive as long as they can. 

 

How have your business and your clients been affected? 

Ultimately, the hardest part about this whole situation is there is no ending date. Planning for things when you know it is likely to take a month for the flood damage to be repaired, you can get the workmen in and you can work around that with the business, is easy.  

At the moment, we have no idea how long this is going to go on for, the actual damage it's going to do to the supply chains of all of our customers and clients. 

For example, the trades that are still out there, they're not actually struggling with going out and doing the work, because they're allowed to. They're struggling with actually getting supplies because all of the supply chains have closed down and started to run out materials. So they actually physically can't do the work.

And so we've seen lots of different things that we actually didn't even think about, or realized would be on the cards and that people are struggling with. Ultimately, though, those with staff, this furlough will help. It will help. But we've just got to make sure that people are doing the right thing and looking after their cash flow in their business as much as possible.  

 

Like many countries around the world, Germany is guaranteeing business loans for firms that need help during the coronavirus pandemic. 

For some, such as sports firm Adidas and travel firm TUI, the figures are available ($2.6 billion and $1.95 billion respectively), while others are approximate. No figure has been given for Puma, but it is understood to be in the hundreds of millions, and negotiations are ongoing for airline Lufthansa.

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