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South Korea’s Moon bemoans GM plant closure move

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South Korean President Moon Jae-in said on Monday General Motors Co’s (GM) decision to shut down a factory south of Seoul will hurt that region, and called upon his administration to take measures to boost economic activity there.

GM announced last week it will shutter the plant in the city of Gunsan, in South Korea’s southwest, by May and decide within weeks on the fate of the remaining three plants in the country.

Gunsan employs 2,000 out of GM’s 16,000-strong workforce in the Asian nation, with local authorities saying one out of five people in the city were dependent on GM for their livelihood.

“Especially, the decline in employment (at GM) and subcontractors will be difficult to bear for Gunsan City and North Jeolla province,” Moon told his aides at a regular meeting, according to a statement released by his office.

Addressing the issue publicly for the first time, Moon asked his administration to look “aggressively” into any possible mitigation measures like designating Gunsan as an “employment crisis area” and called for urgent measures to aid workers affected by pending layoffs.

Since taking office last May, Moon has pushed hard on job creation, especially those for young South Koreans, and the closure of the GM plant is viewed as a setback for his plans regarding boosting employment in Asia’s fourth-largest economy.

Workers at the Gunsan GM plant have called the shutdown a “death sentence” and threatened a strike.

The factory had been running at about 20 percent of capacity over the past three years even before the U.S. car maker announced the shutdown, the latest of steps taken by GM to put profitability and innovation ahead of sales and volume.

A GM Korea spokesman said on Monday the company was committed to supporting the affected workers. The U.S. automaker launched a voluntary redundancy program last week for all its workers in the nation.

U.S. President Donald Trump, who has recently approved import tariffs on washing machines, took the shutdown announcement last week as an opportunity to launch fresh criticism of the free trade agreement between the United States and South Korea.

Trump has been critical of the deal ever since his bid for presidential office and the two countries are in renegotiation.

Moon on Monday also asked his government to act sternly in trade talks with the United States, expressing worry over curbs on imports from other countries recently imposed by Washington.

“Due to the expansion of U.S. import curbs on our export products like steel, electronics, solar panels and washing machines, I worry about our exports as a whole despite our international competitiveness,” said Moon in the same meeting.

“I ask the government to act firmly and sternly to unreasonable protectionist measures, such as by lodging complaints to the World Trade Organisation and checking for violations of the U.S.-South Korea free-trade agreement.”

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IEA cuts 2021 demand outlook on renewed Covid lockdown measures

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A worker holds a fuel pump nozzle at a gas station in Shah Alam, Malaysia, on Tuesday, Jan. 12, 2021.

Samsul Said | Bloomberg | Getty Images

LONDON — The International Energy Agency on Tuesday cut its 2021 global oil demand forecast, citing soaring Covid-19 cases and renewed lockdown measures that will further limit mobility.

The IEA said it now expects world oil demand to recover by 5.5 million barrels per day to 96.6 million this year. That reflects a downward revision of 0.3 million barrels from last month’s assessment and follows an unprecedented collapse of 8.8 million barrels per day last year as the coronavirus pandemic battered global oil markets.

The IEA’s latest oil market report comes as countries continue to implement strict public health measures in an attempt to curb virus spread, with lockdowns imposed in Europe and parts of China.

The Paris-based energy agency said oil demand growth was projected to fall slightly during the first three months of the year in the wake of tougher government plans that call for additional travel restrictions.

This is expected to curb worldwide mobility once again, prompting the IEA to trim its first-quarter forecast for oil demand growth to 94.1 million barrels per day. That would see oil demand return to near year-ago levels and reflects a downward revision of 0.6 million barrels from December’s oil market report.

“The global vaccine roll-out is putting fundamentals on a stronger trajectory for the year, with both supply and demand shifting back into growth mode following 2020’s unprecedented collapse,” the IEA said in its closely-watched report.

“But it will take more time for oil demand to recover fully as renewed lockdowns in a number of countries weigh on fuel sales,” it added.

Oil prices

Oil prices have rallied in recent weeks, supported by optimism over Covid vaccine rollouts and a surprise oil production cut from OPEC kingpin Saudi Arabia.

However, the relatively slow pace of inoculations has raised doubts over how soon economies can recover.

International benchmark Brent crude futures traded at $55.26 a barrel on Tuesday morning, up more than 0.9%, while U.S. West Texas Intermediate futures stood at $52.51, around 0.3% higher.

Both benchmarks fell more than 2.2% in the previous session, notching their worst daily performance since Dec. 21.

Oil pumping jacks, also known as “nodding donkeys,” in a Rosneft Oil Co. oilfield near Sokolovka village, in the Udmurt Republic, Russia, on Friday, Nov. 20, 2020.

Andrey Rudakov | Bloomberg | Getty Images

OPEC and its non-OPEC allies, an alliance sometimes referred to as OPEC+, cut oil production by a record amount in 2020 in an effort to support crude prices, as strict public health measures worldwide coincided with a fuel demand shock.

OPEC+ initially agreed to cut output by 9.7 million barrels per day, before easing cuts to 7.7 million and eventually scaling back further to 7.2 million from January. OPEC’s de facto leader Saudi Arabia has since said it plans to cut output by an extra 1 million barrels per day in February and March to stop inventories from building up.

Last week, OPEC kept its 2021 forecast for worldwide oil demand unchanged. The 13-member group anticipated demand growth to increase by 5.9 million barrels per day year on year to average 95.9 million.

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How to stay motivated during a cold, winter Covid lockdown

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Germany discovers Covid variant in Bavaria

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Snow lies in front of the entrance to the Garmisch-Partenkirchen hospital. A possibly new variant of the coronavirus has been discovered at the Garmisch-Partenkirchen hospital. Samples are currently being examined at the Charité hospital in Berlin, the hospital announced on Monday.

picture alliance | picture alliance | Getty Images

Germany is the latest country to discover a new mutation of the coronavirus, with a new variant identified among a group of hospital patients in Bavaria.

Local news outlets first reported on Monday that an unknown variant of the coronavirus had been discovered among 35 patients at a hospital in the Bavarian ski town of Garmisch-Partenkirchen, southeast Germany.

The altered virus was found in 35 of 73 newly-infected people in the hospital, Bavarian news outlet BR24 reported Monday. Samples are now reportedly being examined at the Charité university hospital in Berlin. CNBC contacted Germany’s health ministry for confirmation of the reports.

Officials said the variant is different from recently discovered variants in the U.K. and South Africa.

The hospital’s deputy medical director Clemens Stockklausner told a press briefing on Monday that there was no understanding, as yet, on whether the mutation made the virus more transmissible (as with the variants discovered in Britain and South Africa), or more deadly.

“At the moment we have discovered a small point mutation … and it is absolutely not clear whether it will be of clinical relevance,” Stockklausner said. “We have to wait for the complete sequencing.”

Neither the British nor South Africa variants have been found to cause more fatalities, although as a result of their ability to spread more easily, they have caused more infections, hospitalizations and, sadly, more deaths. The U.K. and Ireland, in particular, have seen a rapid spread of the mutated virus, which has caused a surge in infections and left some hospitals struggling with an influx of patients.

Information about the new variant found in Germany emerged on the same day that the country’s Health Minister Jens Spahn said the current level of coronavirus sequencing in the country was not sufficient and that laboratories would be obliged (and compensated) to sequence coronavirus samples to monitor virus mutations.

A handful of other countries that have discovered coronavirus mutations, including the U.K. and South Africa, are renowned for their large-scale surveillance and genome sequencing of coronavirus samples.

Last week, Dr. Janosch Dahmen, a physician and German parliamentarian with the Green party, told CNBC that “we need a more precise crisis mode here in Germany to fight the pandemic, and I’m very concerned that the numbers (of infections) will go far higher up like we can see in Great Britain and Ireland at the minute.”

Infections persist

Germany’s 16 state premiers are set to meet with Chancellor Angela Merkel on Tuesday to discuss whether to tighten or extend lockdown restrictions across the country that are due to end on Jan. 31.

Germany’s infection rate remains a significant concern, with a further 11,369 daily cases reported by public health agency, the Robert Koch Institute, on Tuesday. That brings the total number of cases to just over 2 million. The death toll stands at 47,622.

Like other European countries, Germany has been anxious to avoid the spread of the more-infectious strains of the virus found in Britain and South Africa.

Merkel reportedly told her Christian Democratic Union (CDU) party lawmakers last week that “if we don’t manage to stop this British virus, then we will have 10 times the number of cases by Easter … We need eight to 10 more weeks of tough measures,” German daily newspaper Bild reported.

On Monday, Spahn insisted that people should not call coronavirus mutation detected in Britain “the English variant.”

“Just as we didn’t talk about the ‘Chinese virus’ last year, now we shouldn’t talk about the ‘English variant,'” Spahn said, Reuters reported.

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