Over 1,100 experts shared their concerns about the areas affected by COVID-19 in the near and longer term.
The report sets out the issues of concern in relation to business and trade. Experts are concerned with supply and logistics issues, especially in the food industry and health care.
They are also concerned about business support and have identified the arts and culture, hospitality and tourism, retail, manufacturing, and agriculture and horticulture as industries at risk.
Finally, they identified the behavioural and entrepreneurial aspects of industry as areas of concern.
In a survey of more than 1100 experts, they found out what they were most concerned about in the short term (the next 3 months), medium term (the next 3-9 months) and long term (after 9 months) due to the outbreak of COVID-19. Their responses were analyzed and summed up. This analysis is based on the responses received in a survey conducted between 3 and 30 April. The experts raised 260 questions related to business and trade. The following are the areas of concern for experts with regard to this issue.
Supply and logistics systems
In the short to medium term, experts raised over 100 issues related to supply chains and logistics across all industries.
Of particular concern are supply chains in two industries:
More than 50 concerns were expressed in relation to food supply issues. Experts are concerned that dependency on global food supply systems may lead to food shortages in the short and medium term.
Unbalanced food distribution problems were seen as a particular problem because, unlike most other commodities, they could become spoiled if not delivered within the specified period of time.
These interruptions in supply may mean that food waste occurs in some areas and food shortages occur in others. They also expressed concern about food shortages, leading to panic among the population and accumulation of stockpiles.
They suggested that during the SOVID-19 outbreak, contingency plans should be in place to prevent this, such as rationing or rules prohibiting stockpiling.
In the short and medium term, experts are concerned that the United Kingdom may not be able to import the medical equipment and drugs needed during the COVID-19 outbreak.
This includes equipment and drugs for both COVID-19 treatment and many other diseases. They are also concerned that the distribution of equipment and medicines is ineffective.
They suggest that during an outbreak the UK may have to change the rules for the reuse of prescribed medication, which is not currently permitted. To address shortages, people may be asked to return unnecessary (but not open) medication to pharmacies for redistribution to other pharmacies.
Some experts also believe that in the long term, drug control (possibly using technology) should be improved to prevent accumulation and reduce waste.
In the long term, experts are interested in how the UK can build more reliable supply chains and improve logistics. They point out that future demand shocks are likely to occur (when demand for goods/services suddenly increases or decreases).
Some experts are concerned that future supply chains will be more vulnerable than before the outbreak. They warn that this could result in the UK relying on a smaller network and a greater risk of deficits.
Many experts also believe that the UK needs to be more self-sufficient and sustainable in its supply chain in the future. Some believe that over-reliance on international imports has reduced the UK's ability to become self-sufficient.
For example, they point out that production capacity and domestic food production have been declining in recent decades. This makes the UK vulnerable to shortages when events undermine global supply chains.
Experts believe that the UK will need to pursue policies that protect British food production and manufacturing. They also suggest that in the future the policy should ensure that local production is more profitable than imported goods.
They suggest increasing investment in local infrastructure to support British supply chains and logistics.
The experts are also concerned that British exports may suffer in the long term. They note that some countries are already restricting imports.
They fear that many countries in the future will pursue economic policies that limit imports from other countries (protectionism). This will affect the dependence of British business on foreign trade.
Long-term problem in this area: Countries that are less focused on building a domestic production base with limited economic diversification and less focused on skills development and cross-training will be affected in the long term by COVID-19.
In the short, medium and long term, experts raised more than 100 issues of concern regarding business support. In the short term, some experts would like to know how it was determined which business was allowed to remain active during isolation (those that were considered "essential services").
Many experts are concerned that in the short, medium and long term, consumer behaviour will change and businesses will face financial difficulties. They are afraid that this will lead to job losses, bankruptcy and closure of enterprises. They believe that local enterprises and small and medium-sized enterprises are at greatest risk.
Some experts fear that, in the medium term, the support packages offered to enterprises will not be able to sustain their viability and that they will eventually receive high-risk loans to cover their costs. Others also expressed concern that some individuals (such as freelancers and self-employed persons) were not protected by public financial support.
In the long term, the experts are concerned that enterprises that have initially survived will find themselves in financial difficulty. For example, enterprises may try to take new loans to pay for some of the old ones.
This would create a "snowball" debt burden for the companies. Experts are concerned that if consumer demand does not return to normal, many companies will face a solvency crisis. This is where businesses do not have enough income or assets to repay their debts.
If many businesses face a solvency crisis at the same time, it can seriously harm the economy and cause a surge in unemployment. Experts believe that in the long term, insolvency laws may need to be amended to reduce the economic impact of widespread insolvency.
The medium-term problem in this area: The most important concern is that too many businesses will not be able to recover from the Covida 19 pandemic, which will lead to job losses and a serious economic downturn.
Experts note that most businesses are at risk of collapse without adequate support during the COVID-19 outbreak. However, experts are particularly concerned about the following specific industries (in descending order of number of references):
Art and culture
Theatres, museums and other cultural facilities may be closed for long periods of time. This will affect their profits and their ability to continue working. It will also affect the income of people who work in the arts and culture. They note that art and culture is already an unstable industry and many people working in it are freelancers. Experts are concerned that some arts and culture may never reopen and this will be a loss to local communities and to British culture in general.
Hotel business and tourism
These industries will be severely affected by the lack of international travel and the continued restrictions on social distance. They note that the industry employs many people and, without measures to support it, there is the potential for large-scale job losses.
Experts are afraid that consumer behaviour will change during isolation and people will prefer to buy goods online in the future. This will affect traditional retail stores, including high street stores in the UK, and that this situation could lead to their elimination.
They point out that the closure of retailers will have a detrimental impact on urban centres and on landlords of retail stores.
Experts believe that maintaining production is vital if the UK is to continue to have access to goods. They note that during the COVID-19 outbreak, manufacturers of medical products play an important role. However, experts fear that restrictions on social distancing may mean that manufacturing firms cannot quickly resume operations. They also point to the need to strengthen British manufacturing to prevent supply chain problems in the future.
Agriculture and horticulture
Experts note that business in agriculture and horticulture is seasonal. Delays in harvesting and selling products may lead to a year-long decline in profits for these businesses. Experts are afraid that without specific support many businesses in this area may close down. This will exacerbate problems with food supply chains that may arise in the future.
A short term problem in these sectors: How will the hospitality sector (including food/beverages, both international and domestic tourism) be rehabilitated and what can the government and professionals in this field do to support its rehabilitation?
In the short and medium term, some experts suggest encouraging businesses to cooperate rather than to compete. For example, sharing production knowledge would increase the production of essential goods.
Other experts expressed concern that the outbreak of COVID-19 would allow some businesses to engage in illegal or irresponsible practices. Specific concerns were expressed that enterprises would not fulfil their legal duties to staff or their procurement obligations.
Concerns have also been expressed about unfair contracts being entered into during this period between enterprises with high negotiating power and those without it. More serious concerns included a potential increase in corruption, theft and the unlawful use of people.
Experts were concerned that not enough had been done to assess the behavioural situation in the industry during the COWID-19 outbreak.
In the long term, some experts note that the creation and activation of business after the outbreak of COVID-19 requires entrepreneurial activity. They are concerned that there is currently a lack of support for entrepreneurs.
They also note that laws that disqualify directors of insolvent enterprises and deprive them of the right to be directors in the future could be detrimental in this period. This is because viable enterprises may fail through no fault of the director, and disqualification prevents those entrepreneurs from creating potentially successful new businesses.
They also suggest that more research and development funding may be needed to bring to market new products created during this period.