9.7 % ↓ $8.8 t · global gdp loss equivalents source: international monetary fund $2.9 trillion...

9.7 % ↓$8.8 T ↓

Global GDP

Source: Asian Development Bank

Global GDP Loss Equivalents

Source: International Monetary Fund

$2.9 Trillion

#7

$3.2 Trillion

#5

$2.6 Trillion

#8

Global Job Losses

Global Job Losses

158 – 224 MM

Global Job Loss Equivalents

Source: CIA Factbook

160 Million

#3

65 Million

#8

Global Job Loss Equivalents

Source: International Monetary Fund

Countries Requesting Assistance from the IMF*

100Requests Approved*

55*As of May 18, 2020

2.3 2.2 3.2 3.5 2.5 3.5 2.9 1.13.1 2.0 2.1 2.1

-4.8

-36.0

-31.0

-26.0

-21.0

-16.0

-11.0

-6.0

-1.0

4.0

Q1/17 Q3/17 Q1/18 Q3/18 Q1/19 Q3/19 Q1/20 Q3/20

Source: U.S. Bureau of Economic Analysis

Growth Rate, % Change from Previous Quarter

US Gross Domestic Product

2.3 2.2 3.2 3.5 2.5 3.5 2.9 1.13.1 2.0 2.1 2.1

-4.8

-33.3-36.0

-31.0

-26.0

-21.0

-16.0

-11.0

-6.0

-1.0

4.0

Q1/17 Q3/17 Q1/18 Q3/18 Q1/19 Q3/19 Q1/20 Q3/20

Source: U.S. Bureau of Economic Analysis

Growth Rate, % Change from Previous Quarter

US Gross Domestic Product

211 282

3,307

6,867 6,615

5,2374,442

3,8673,176

2,687 2,438

March 7 March 14 March 21 March 28 April 4 April 11 April 18 April 25 May 2 May 9 May 16Source: U.S. Employment and Training Administration

000s

Initial Claims for Unemployment

Houston Job Losses (March + April)

330,000

Initial Claims for Unemployment Benefits (Mar 15 – May 9)

425,000

Unemployment Rate

14.2%

Three Houston Indicators

Houston Job Losses (March + April)

330,000

Initial Claims for Unemployment Benefits (Mar 15 – May 9)

425,000

Unemployment Rate

14.2%

Three Houston Indicators

Houston Job Losses (March + April)

330,000

Initial Claims for Unemployment Benefits (Mar 15 – May 9)

425,000

Unemployment Rate

14.2%

Three Houston Indicators

Houston PMI

30

35

40

45

50

55

60

65

70

'08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20 '21Source: Institute for Supply Management-Houston

Above 50 = Expansion, Below 50 = Contraction

$99,365,224$107,199,928

$51,381,735

$12,459

Jan '20 Feb '20 Mar '20 Apr '20Source: City of Houston

Houston Mixed Beverage Receipts

-

10,000

20,000

30,000

40,000

50,000

60,000

7-Jan 14-Jan 21-Jan 28-Jan 4-Feb 11-Feb 18-Feb 25-Feb 3-Mar 10-Mar 17-Mar 24-Mar 31-Mar 7-Apr 14-Apr 21-Apr 28-Apr 5-May 12-May

Source: City of Houston

City of Houston Downtown Parking Transactions(7 day average)

Houston Re-Opening

Houston Re-Opening

-120

-100

-80

-60

-40

-20

0

2018

-Feb

25-F

eb

3-M

ar

10-M

ar

17-M

ar

24-M

ar

31-M

ar

7-Ap

r

14-A

pr

21-A

pr

28-A

pr

5-M

ay

12-M

ay

% C

hang

e fro

m S

ame

Wee

k La

st Y

ear

Source: Open Table

Houston-Area Restaurant Reservations

Impact of COVID-19 on Houston’s Global Business

Inventory of Global Assets

Metro Houston Exports – Billions

$65.8

$120.7

'09 '18Source: U.S. International Trade Administration

Top Exporting Metros

47.3

59.7

64.8

97.7

120.7

Chicago

Seattle

Los Angeles

New York

Houston

$ Billions

Source: U.S. International Trade Administration

Top Customs Districts

Rank District Million Metric Tons

1 Houston/Galveston 320.9

2 New Orleans 238.8

3 Los Angeles 115.0

4 Port Arthur 92.5

5 New York 81.4Source: WISERTrade

Trading Partners

183 Trading Partners

45 countries with $1 billion+ bilateral trade

Top Trading Partners – ’19

Mexico $21.7B Brazil $15.4B China $14.7B S. Korea $13.5B Netherlands $11.7B

India $10.1B Germany $10.0B

United Kingdom $9.3B

Japan $9.2B Colombia $7.0B

Top Houston Commodities – ’19

• 11,000+ exporters• 1,700+ foreign-owned firms• 91 countries with official government offices• 56 international chambers, trade associations,

commercial offices• 17 foreign banks

International Snapshot

Impact on Houston’s Global Business

Slower growth over the next 2-3 yearsWeaker demand for Houston exportsLimited access to overseas marketsFewer foreign visitors to HoustonReduction in foreign direct investment (FDI)

Impact on Houston’s Global Business

Slower growth over the next 2-3 yearsWeaker demand for Houston exportsLimited access to overseas marketsFewer foreign visitors to HoustonReduction in foreign direct investment (FDI)

Impact on Houston’s Global Business

Slower growth over the next 2-3 yearsWeaker demand for Houston exportsLimited access to overseas marketsFewer foreign visitors to HoustonReduction in foreign direct investment (FDI)

Impact on Houston’s Global Business

Slower growth over the next 2-3 yearsWeaker demand for Houston exportsLimited access to overseas marketsFewer foreign visitors to HoustonReduction in foreign direct investment (FDI)

Impact on Houston’s Global Business

Slower growth over the next 2-3 yearsWeaker demand for Houston exportsLimited access to overseas marketsFewer foreign visitors to HoustonReduction in foreign direct investment (FDI)

Impact on Houston’s Global Business

Export Demand

Published October 1, 2019

73 126 234 306 407 467 598 570

814

1,463

0.6 0.81.3

1.72.2 2.5

3.7 3.6

4.7

7.5

0.0

1.0

2.0

3.0

4.0

5.0

6.0

7.0

8.0

0

200

400

600

800

1,000

1,200

1,400

1,600

'09 '10 '11 '12 '13 '14 '15 '16 '17 '18

% o

f Wor

ld’s

Impo

rts

Rest

rictio

ns in

For

ce

Source: World Trade Organization

Import Restrictions In Force % of World's Imports

Import Restrictions In Force

May 10, 2019

April 3, 2019

$7.6 B

$4.4 B

0

1

2

3

4

5

6

7

8

9

'00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19

$ Bi

llion

s

Source: WISERTrade

Houston Exports to China

$12.7 B

$14.6 B

0

2

4

6

8

10

12

14

16

18

'00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19

$ Bi

llion

s

Source: WISERTrade

Houston Exports to Mexico

-15

-10

-5

0

5

10

15

'71 '73 '75 '77 '79 '81 '83 '85 '87 '89 '91 '93 '95 '97 '99 '01 '03 '05 '07 '09 '11 '13 '15 '17 '19

% C

hang

e

Source: Partnership calculations based on World Bank data

% Change from Previous Year

GDP Exports

Global Growth, Exports v GDP

International Air Service

• 2 international airports• 23 carriers offering international service• 67 international destinations• 37 countries• 851 international flights per week

Ranking Airport International Flights/Week

1 New York – JFK 1,526 2 Miami – MIA 1,424 3 Los Angeles – LAX 1,111 4 Newark – EWR 880 5 Houston – IAH 851 6 Chicago – ORD 768 7 Atlanta – ATL 697 8 San Francisco – SFO 684 9 Fort Lauderdale – FLL 648

10 Dallas/Fort Worth - DFW 628

U.S. International Airports

U.S. International Airports

“. . . 3 to 5 years for airline industry to return from ‘apocalyptic’ state . . .”

David L. CalhounCEO of Boeing

0.0

0.5

1.0

1.5

2.0

2.5

3.0

1-Mar 8-Mar 15-Mar22-Mar29-Mar 5-Apr 12-Apr 19-Apr 26-Apr 3-May 10-May17-May24-May

Mill

ions

Source: Transportation Safety Administration

2020 Same Weekday 1 Year Ago

TSA Checkpoint Travel Data, Entire US

International Air Transportation Association (IATA) Survey

• 86% respondents concerned about quarantine while traveling

• 69% would reconsider travel if it might result in a 14-day quarantine

Possible solutions

IATA Forecast

• Domestic traffic returns to pre-COVID levels in 2022

• International traffic returns in 2024

• Reduces Houston’s global reach• More difficult to recruit overseas clients• Loss of touch with existing clients• More difficult to attract foreign talent• Slows tech transfers• Reduces tourism• Weakens global supply chains• Affects investment decisions (FDI)

Why is this a problem?

• Reduces Houston’s global reach• More difficult to recruit overseas clients• Loss of touch with existing clients• More difficult to attract foreign talent• Slows tech transfers• Reduces tourism• Weakens global supply chains• Affects investment decisions (FDI)

Why is this a problem?

• Reduces Houston’s global reach• More difficult to recruit overseas clients• Loss of touch with existing clients• More difficult to attract foreign talent• Slows tech transfers• Reduces tourism• Weakens global supply chains• Affects investment decisions (FDI)

Why is this a problem?

• Reduces Houston’s global reach• More difficult to recruit overseas clients• Loss of touch with existing clients• More difficult to attract foreign talent• Slows tech transfers• Reduces tourism• Weakens global supply chains• Affects investment decisions (FDI)

Why is this a problem?

• Reduces Houston’s global reach• More difficult to recruit overseas clients• Loss of touch with existing clients• More difficult to attract foreign talent• Slows tech transfers• Reduces tourism• Weakens global supply chains• Affects investment decisions (FDI)

Why is this a problem?

• Reduces Houston’s global reach• More difficult to recruit overseas clients• Loss of touch with existing clients• More difficult to attract foreign talent• Slows tech transfers• Reduces tourism• Weakens global supply chains• Affects investment decisions (FDI)

Why is this a problem?

• Reduces Houston’s global reach• More difficult to recruit overseas clients• Loss of touch with existing clients• More difficult to attract foreign talent• Slows tech transfers• Reduces tourism• Weakens global supply chains• Affects investment decisions (FDI)

Why is this a problem?

• Reduces Houston’s global reach• More difficult to recruit overseas clients• Loss of touch with existing clients• More difficult to attract foreign talent• Slows tech transfers• Reduces tourism• Weakens global supply chains• Affects investment decisions (FDI)

Why is this a problem?

Foreign Direct Investment

Foreign Direct Investment

Since ’09• 669 announcements• 439 foreign-owned firms• 37 countries• 63 industries• $35.6 billion invested

Foreign Direct Investment

• Infuses new capital into the region• Expands the manufacturing base• Helps underpin jobs• Facilitates the exchange of ideas and best practices• Increases trade• Stimulates growth• Adds to the tax base

Foreign Direct Investment

• Infuses new capital into the region• Expands the manufacturing base• Helps underpin jobs• Facilitates the exchange of ideas and best practices• Increases trade• Stimulates growth• Adds to the tax base

Foreign Direct Investment

• Infuses new capital into the region• Expands the manufacturing base• Helps underpin jobs• Facilitates the exchange of ideas and best practices• Increases trade• Stimulates growth• Adds to the tax base

Foreign Direct Investment

• Infuses new capital into the region• Expands the manufacturing base• Helps underpin jobs• Facilitates the exchange of ideas and best practices• Increases trade• Stimulates growth• Adds to the tax base

Foreign Direct Investment

• Infuses new capital into the region• Expands the manufacturing base• Helps underpin jobs• Facilitates the exchange of ideas and best practices• Increases trade• Stimulates growth• Adds to the tax base

Foreign Direct Investment

• Infuses new capital into the region• Expands the manufacturing base• Helps underpin jobs• Facilitates the exchange of ideas and best practices• Increases trade• Stimulates growth• Adds to the tax base

Foreign Direct Investment

• Infuses new capital into the region• Expands the manufacturing base• Helps underpin jobs• Facilitates the exchange of ideas and best practices• Increases trade• Stimulates growth• Adds to the tax base

Foreign Direct Investment

Published January 20, 2020

Foreign Direct Investment

Foreign Direct Investment in U.S.

-5.0

0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

'87

'88

'89

'90

'91

'92

'93

'94

'95

'96

'97

'98

'99

'00

'01

'02

'03

'04

'05

'06

'07

'08

'09

'10

'11

'12

'13

'14

'15

'16

'17

'18

'19

'20

Source: Board of Governors of the Federal Reserve System

% Change from Year Ago

Shaded areas indicate U.S. recessions

What about crude?

Crude Futures

U.S. Rig Count

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000

'14 '15 '16 17 '18 '19 '20 '21

Num

ber o

f Dril

ling

Rigs

Source: Baker Hughes

404 Rigs318 Rigs

Energy Layoffs

Houston’s Energy Sector Layoffs

Since February ’20 13,200 Jobs ↓

Since April ’19 21,200 Jobs ↓

Includes exploration and production, oil field services, fabricated metal products and oil field equipment manufacturing

Houston and Energy in a Post-COVID WorldTuesday, June 23 | 12:00 p.m.

www.Houston.org/events

Slower growth over the next 2-3 years• Weaker demand for Houston exports• Limited access to overseas markets• Fewer foreign visitors to Houston• Reduction in foreign direct investment (FDI)

Impact on Our Global Business

Larry KudlowDirector, United States National Economic Council

Jerome H. PowellChairman of the U.S. Federal Reserve

“We will not go back to where we were when the pandemic started. That is pretty certain. But that is the only thing that is certain.”

George Soros