Coronavirus Diligence Briefing

• In the United States, the Biden administration hinted that unused COVID-19 relief funds could be used to pay for the multi-trillion dollar infrastructure proposal. “The President’s bottom line, as you’ve heard him say a few times before, is that he does not want to raise taxes on people making less than $400,000 a year,” White House Press Secretary Jen Psaki said on Thursday. “We certainly, in that scenario, would need to assess whether these funds are needed, and not take them away from fighting the pandemic that we continue to battle every day.” The Biden administration’s infrastructure bill is not sitting well with Republicans due to the trillion dollar price tag, among other things.
  
  
• In Canada, Prime Minster Justin Trudeau took to Twitter on Thursday to announce the land border with the United States will remain closed for the foreseeable future. “To protect your health and limit the spread of COVID-19, we’re extending the measures currently in place by another 30 days. Non-essential travel between our two countries remains restricted until June 21^st,” the Prime-Minister said via social media. Global News though is reporting an American lawmaker would like to see a different plan come next month. New York state Congressman Brian Higgins said it is time both the Canadian and United States government need to provide a “vision” for how the borders could be reopened. “As opposed to announcing another closure, let’s say that when 30 to 60 days (passes), we can look at that category of essential travel or to include more travellers, in recognition of the availability of vaccines and distribution and administration of vaccines,” Higgins said.
  
  
• United Kingdom’s Public Health England (PHE) has noted in a preliminary study that two doses of the AstraZeneca COVID-19 vaccine may be 85% to 90% effective against symptomatic disease. While noting their data is not conclusive due to not having enough information, the PHE said the preliminary findings were the first of its kind on the effectiveness of two doses of AstraZeneca in a real-world setting. The UK was the first country to roll out the AstraZeneca vaccine and it has been hampered by questions ever since ranging from the construction of its clinical trials, the efficacy of the vaccine, the blood clotting side effects, and the optimal gap between doses. 
  
  
• Italy’s government has approved a £40 billion stimulus package that will extend economic support for businesses and families hurt by COVID-19 restrictions. The package will allocate £17 billion for companies and self-employed workers, £9 billion to provide credit and liquidity for struggling businesses and £4 billion to workers in industries hit hardest by the pandemic. The funds included in the new package will be financed with extra deficit spending already approved by the administration and Prime Minister Mario Draghi noted as long as the pandemic situation continues to improve, the country won’t need further support measures in 2021.
  
  
• Bloomberg is reporting the slow rollout of the coronavirus vaccines in Africa could cost the continent $14 billion a month in economic output. Dena Ringold, the World Bank’s Africa regional director for human development noted on Thursday the COVID-19 pandemic has continued to exert pressure on African economies and exacerbate poverty. African governments are struggling to vaccinate their population with less than 0.5% of the continent’s roughly 1.3 billion people fully immunized to date. Africa relies heavily on India and their Serum Institute for their vaccine and that slowed to a trickle this month due to their country dealing with a COVID-19 crisis of their own. 
  
  
• The Philippines’ Health Department says it will no longer allow local governments to announce which brand of coronavirus vaccines will be available at inoculation sites. The move comes after hundreds of people lined up at a Manila site earlier in the week when realized the Pfizer vaccine would be given there. Undersecretary Myrna Cabotaje told a CNN affiliate the following: “From now on, only people already in line at a vaccination site will be told which shot they will get and if you do not like the vaccines given during that time, then they go to the end of the line.” As of Wednesday, less than 1% of the Philippines population of 108 million have been fully vaccinated.

Covid-19 – Due Diligence And Asset Management

How “Omnipresent” Client Conferencing is a Game-Changer for Hedge Fund Manager-Investor Relationships

Brief : The increased frequency of client communications during the pandemic has been a “game-changer” for the hedge fund manager-allocator dynamic, according to speakers on the fundraising and investor relations panel at this year’s hedgeweekLIVE Technology Summit. The discussion explored how investor relations and fundraising has been reshaped by the Covid-19 pandemic, and weighed up how the past 15 months of virtual networking may have permanently altered client communications, capital introduction, investor appetite and more. Greg Zaffiro, partner and head of IR and marketing at Electron Capital, a global long/short equity manager which manages more than USD2 billion and focuses on mainly on public utilities, said the frequency of investor updates has been a seismic shift. “It’s much more than just your quarterly update, or even monthly update,” Zaffiro observed, adding the change is underpinned by a greater degree of transparency which was boosted by an early switch from dial-in telephone calls to video conferencing.  He believes that move has empowered investors to more closely probe managers on portfolio decisions and opportunity sets. “That sort of feedback has really never been omnipresent as it is today,” he added. “It’s been a game-changer in terms of the level of transparency.”

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G-7 To Discuss Ways To Recognize Vaccine Certificates Globally

Brief: The Group of Seven nations will next month discuss ways to recognize Covid-19 vaccination certifications internationally, according to a person familiar with the matter. The group of major economies aims to support the creation of a global framework for mutual recognition of documents showing proof of inoculation, said the person, who asked not to be identified. Such an endorsement, if it leads to the creation of concrete measures, would ease the revival of global travel as more people get the coronavirus jab. It would be especially welcomed by the airline and tourism industries, among the hardest hit by the pandemic. The European Union announced this week that it will soon allow quarantine-free travel to the bloc for vaccinated visitors. The move hasn’t been matched by other G-7 members, with the U.S. yet to loosen rules for European visitors. The U.K. requires travelers from the vast majority of the EU to quarantine and is advising against travel to several nations. The EU is also in the final stages of approving a framework for member states and their vaccination certificates. As part of a declaration that G-7 health ministers will adopt when they meet in Oxford in early June, the group is expected to set out the need for multilateral collaboration on an inter-operable, standards-based solution that can be used internationally to verify vaccinations.

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Canada Pension Plan Sees Emerging Markets, U.S. Consumer Credit Gains

Brief: Canada Pension Plan Investment Board is bullish on U.S. consumer credit and sees good opportunities in emerging markets, despite the devastating toll the Covid-19 pandemic has taken on leading countries such as Brazil and India. U.S. households are flush with savings and central banks will continue to prime the economy with easy money for a while, new Chief Executive Officer John Graham said in an interview. That’s positive for returns in consumer-oriented investments, he said. “A year ago there was a lot of uncertainty with high unemployment, but with the stimulus that came in the U.S., consumer credit performed very well. Our investment in home improvement loans really exceeded our expectations,” Graham said Thursday. CPPIB returned 20.4% for the year ended March 31, its best showing since it was created in the late 1990s, helped by base effects: Global equity markets were just starting their climb back from the crash of early 2020 as the new fiscal year began. The fund’s holdings of Canadian stocks advanced 40.8% for the year and emerging markets stocks gained 34%, the fund said in a statement. Private-equity investments outside of Canada returned well over 30%.

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