This year has been marked by a series of convulsions — creating both new opportunities and new pitfalls that will remake the global economy for years to come. Today’s Daily Dose fills you in on who’s coming out on top and who’s getting pummeled, creative ways people have found to get by, the countries that are killing it and innovative leaders worth following.
Charu Sudan Kasturi and Daniel Malloy, Senior Editors
1. Defiant Retailer
Mexican retailer and financial services firm Grupo Elektra has locked horns with the country’s populist president, Andrés Manuel López Obrador, defying lockdowns during the pandemic to keep its stores open. Its owner, billionaire Ricardo Salinas Pliego, has accused the government of destroying the nation’s economy with its restrictions. Grupo Elektra saw its revenue grow 15 percent in the year’s first quarter — the latest data available.
2. Whiskey to Pop
There are few, if any, alcohol companies with a lineup of whiskeys to match Suntory’s. Yet the Japanese manufacturer of Yamazaki, Hibiki, Jim Beam and other iconic whiskeys is now riding a high, producing a new type of offerings: alcopop, or sodas topped up with a dash of alcohol. Globally, the alcopop industry is expected to grow nearly 6 percentage points faster this year than in 2019. And Suntory, Japan’s leading manufacturer of alcopop drinks, saw its sales jump 20 percent between January and June. Cheers to that.
3. Fintech Pharoah
Pyramids, mummies, the Blue Nile, an endless desert ... and fintech? Fawry, Egypt’s first billion-dollar tech firm, is changing the country’s image. Egypt’s largest e-payment platform, with a network of ATMs across the otherwise poorly connected nation, Fawry listed on the country’s stock exchange in August last year and has seen its stock price shoot up by 300 percent since then. As a public company, it’s no longer a unicorn. But it comes from a land with no shortage of mythical creatures — and it’s creating its own legend to match.
4. Duty-Free Carrot
The country is still restricting outbound tourist travel, so it’ll be some time before you catch the familiar sight of a group of Chinese travelers following a flag-wielding leader around Times Square or the Champs-Élysées. But with the pandemic largely under control within China, the country’s government is trying to revive its domestic tourism industry by offering something Chinese nationals have long craved: duty-free purchases. The country has historically imposed high taxes on luxury goods at home, and mainland Chinese consumers have preferred Hong Kong, Singapore and even Mongolia as destinations where they can pick up fancy perfumes, designer clothing and chic bags. Now the government has relaxed duty-free rules, fueling a boom in domestic tourism, benefiting firms like the state-backed China Tourism Group Duty Free Corp., which has seen its stocks rise 141 percent this year.
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As the U.S. presidential election draws closer, OZY is partnering with Danai Gurira, Stephen Daldry, Lynn Nottage and dozens more members of the theater community to present Act Out: Vote 2020, a special hourlong video event featuring monologues, songs and other dramatic performances to encourage audiences to vote. The special will be available to stream from Thursday, Oct. 29 at 9 p.m. ET. Subscribe here so you don't miss the premiere — and stay tuned for Friday's special episode of The Carlos Watson Show with guests Gurira and Heidi Schreck talking about the project.
There will come a day when our airports are no longer ghost towns, but the airline industry’s problems won’t simply vanish with a widespread coronavirus vaccine. Expect smaller jets, a move away from the “hub-and-spoke” route system and a wave of consolidations around the world. The International Air Transport Association says passenger traffic will rebound to pre-pandemic levels by 2024, but other industry experts say it could take longer as companies trim expenses after conducting so much business over Zoom and climate change worries continue to grow.
2. Rental Reckoning
Lost jobs and slashed wages mean many American renters can’t afford their monthly payments. With national and state moratoriums on evictions, the market has been teetering but hasn’t hit crisis levels yet. Those bills are still coming due, though, and Moody’s Analytics predicts that unless the federal government steps up with more stimulus spending, which seems unlikely, unpaid rent could stack up to $70 billion by year’s end.Rent insecurity is hitting families of color the hardest, and unpaid bills are putting landlords in a bind too.
3. Small-Town Baseball
While Major League Baseball just wrapped up a captivating World Series for the worst TV audience in its history, small-town America is feeling a cash crunch as MLB abandons Appalachia. The minor league teams that long provided common culture and economic opportunity in the mountains of West Virginia and Tennessee are being slashed, and these communities will never be the same.
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2. Give Advice
Are you an expert in something — not recalling obscure sports stats, but something useful? You can make anywhere from $18 to $50 per answer on JustAnswer, where users query a stable of experts from doctors to mechanics to tax preparers to veterinarians.
Small businesses, already hammered by the recession, are feeling the bite of 2.5 percent (or higher) transaction fees on credit cards, leading to $100 billion in lost revenue per year. To avoid fees, these businesses are increasingly turning to apps like Venmo or Square Cash. Consumers, particularly Gen Zers, are already using these mobile wallets for myriad transactions and appreciate the convenience. So don’t be surprised if they pop up at your corner deli.
Living month to month is precarious, and that’s just as true for businesses as it is for people: Half of all small U.S. businesses have fewer than 15 cash buffer days, meaning they’re vulnerable to having to shutter for good in a crunch like we’re seeing now. How should a stretched business owner cope? Constantly seek out new revenue streams and consider renegotiating payment terms with your vendors.
The headlines in April were ominous for the world’s second-largest economy. Its GDP had shrunk for the first time in four decades, and our collective dependence on Chinese manufacturing and markets meant that Beijing’s woes could become the world’s tears. Yet green shoots of growth soon reemerged, and in the year’s third quarter, China registered nearly 5 percent economic growth. The secret of this stunning turnaround lies in the fact that … there’s really no secret at all. The coronavirus pandemic started in China, but the country quickly isolated pockets with outbreaks, ruthlessly pursued contact tracing, tested entire cities in days and contained the crisis. Its economy was the first to be hit but also the first to start growing again. And with other major nations still struggling, China has positioned itself as the world’s economic engine even more than before the pandemic, driving up sales of American brands such as Nike.
For decades, Polish migrants moved to Germany for a better life, drawn by the dream of making it big in Europe’s largest economy. Now the tables are turning. Poland, which survived the 2008–09 crisis relatively unscathed, is projected to witness the smallest 2020 dip in GDP of any European nation and to grow again next year. It sells the one thing a locked-down world can’t seem to get enough of: video games. Amid the pandemic, the world’s sixth-largest video game exporter has even included gaming in its school curriculum — starting the next generation of developers early. And the ripples of its economic success are being felt beyond its border. In parts of eastern Germany that feel neglected by Berlin, schools are now teaching Polish as a second language as German parents prepare their children to move to Poland for their economic future.
It was an early success story in the face of the pandemic, swiftly restricting travel, scaling up local manufacture of personal protective equipment, testing more than any African country other than South Africa and using drones to deliver medical supplies to remote regions. The result? At a time the crisis is expected to send global investments crashing by 40 percent in 2020, Ghana has attracted foreign money as though it’s any other year.
While the White House and Democrats in Congress have bickered over the fine print of stimulus packages, this North African country has shown how early, proactive economic measures to help those most vulnerable can benefit the entire nation. Since the start of the pandemic, Egypt has increased its health spending and expanded coverage under a web of conditional cash transfer programs. It’s now a rare country that’s expected to grow faster in 2020(3.5 percent) than in 2019 (2 percent), though experts say deep-seated income inequality remains a long-term challenge
Like Ghana, the self-governed island has been a standout success in the battle against the pandemic. And with the West increasingly looking for alternatives to Chinese tech amid growing tensions this year, Taiwanese manufacturers central to the 5G supply chain are witnessing a dramatic boost, stitching up major deals with global giants like Nokia. In a year of economic bloodshed, its GDP is expected to notch marginal gains. “Taiwan stands out for its scant evidence that a global pandemic has even occurred,” JPMorgan’s economists wrote in September.
Jalen Rose and Carlos get into it after the famed former basketball player leaves a legend off his NBA top five. Rose also tells Carlos a great Kobe story, and shares his advice for the “math of friendship” and why he’s the OG Jalen. Why does he think you need to be “maniacal for greatness”?
The tobacco industry, that is. Far from it, in fact. Major cigarette manufacturers are recording a spike in sales as the stress of 2020 has more people turning to smoking. Anecdotal evidence from countries ranging from Australia to the U.S., and Singapore to Ireland, backs up these numbers.
2. Trump Jinping
Presidents Donald Trump and Xi Jinping might present themselves as archenemies on the global stage, with the U.S. leader blaming Beijing for the pandemic and using racist terms such as the “Kung Flu.” But in reality, Trump has forced Xi to at least partly imitate his “America First” approach. China is adapting its export-driven economy into what Xi has described as a “dual circulation” strategy that for the first time in decades emphasizes the domestic market as a central pillar for the growth of Chinese companies. The country’s top leadership is meeting this week to lay out Beijing’s economic plans for the next five years and more. Stay tuned: Whatever China decides will affect you, or at least the price of your next iPhone.
3. Nigeria’s Bitcoin Revolution
It takes guts, fearlessness … and money to force meaningful change. As thousands of young Nigerians have taken to the streets in recent weeks to demand an end to police brutality, they’ve spawned a web of organizations that work together and crowdfund their operations. But it soon became clear to protesters that traditional online transactions were getting slower and harder — though the government denies any role. So they’ve turned to cryptocurrency to finance their revolution. By Oct. 22, Bitcoin accounted for 40 percent of the $387,000 collected by Feminist Coalition, one of the leading groups behind the protests. Will other protest movements follow Nigeria’s example?
It’ll take some heavy lifting to get to this zero. Yet more and more countries are publicly adopting net-zero emissions targets, with 2020’s crises only prodding them further toward adapting their economies for a global choice that can no longer be put off: a cleaner climate or catastrophe. Net-zero emissions by 2050 were a central part of the deal struck by Ireland’s coalition partners in June. Hungary made a similar commitment in June. China, the world’s biggest polluter, told the U.N. in September that it would transition to a net-zero emission economy by 2060. And on Monday, Japan joined the club, setting 2050 as its target.
leaders to know
1. Mark Cuban
Meet the blue-collar billionaire. Cuban outworked, outlearned and outhustled his way to the top of the tech world — then became the dynamic owner of the Dallas Mavericks and a canny investor on Shark Tank. On The Carlos Watson Show, Cuban reveals his surprising reaction to team losses, how he raises self-sufficient children and gives his ultimate advice to young entrepreneurs.
A former educator who worked for the New York City public school system, Walker is now aiming to close the opportunity gap in a different way. His New Orleans–based Camelback Ventures invests in diverse and innovative founders, but he’s been continually frustrated by systemic racism within the philanthropic community that backs many of his startups. So Walker launched racial justice trainings for white executives at corporations and philanthropies.
The CEO of Williams-Sonoma had pivoted toward online retail before the pandemic, and it’s paying off big-time. The company, which aside from its cookware owns home decor mainstays Pottery Barn and West Elm, is seeing surprising revenue growth this year — even as much of the retail industry flags. Why? People are staying home and cooking more, so they want to spruce up their surroundings and get a saucepan that actually holds up.