- ECONOMIC IMPACT -

Latest update: 18 November

After weeks of gradual decline, GDP estimates for many countries have levelled off. Negative GDP growth is forecast in all countries except China.

The European Commission estimates that
the Euro Area economy will contract by 7.8% in 2020 and then recover to 4.2% in 2021.

-3.9%

Consensus forecast for global GDP growth in 2020.

7.5%

The EU’s seasonally adjusted unemployment rate for September 2020.

Global real GDP growth

% change on previous year

2.6%

2.8%

-3.9%

Pre-Covid-19 2020 forecast

2019 average

Adjusted 2020 forecast

The cost of Covid-19

$375bn

Estimated monthly cost of the Covid-19 pandemic globally

$11tn

Cumulative loss for global economy over the next two years

- SECTOR IMPACT: Aerospace, defence and security -

Latest update: 2 December

The commercial aerospace sector has taken a severe hit, but the interdependent and complex relationship between aerospace and defence is expected to spread the damage in the sector.

Defence is being used as a stimulus measure in markets with large domestic capacity, particularly the US and UK, but there will be medium-term constraint due to fiscal pressures.

Sector indices

The interdependent relationship between aerospace and defence has helped to cushion the impact of Covid-19 on companies working across both segments. Targeted government aid will be instrumental to recovery in these sectors.

Revenue predictions

Boeing and Airbus post unprecedented losses throughout the year, with last quarter being the worst on record for the global aerospace industry.


Defence is being used as a stimulus measure in markets with large domestic capacity, particularly the US, but there will be medium-term constraint due to fiscal pressures.

Supply and demand disruption

The US Department of Defense experienced delays of around three months to major defence acquisition programmes, noting specific vulnerability within aerospace, shipbuilding and small space launch markets.


Supply chain security initiatives have been given additional impetus, such as for microelectronics in the US. 


In most cases, immediate budget reductions in defense have been minimal and represent deferral of programs, not outright cancellations

Sub-sector impact

Military aerospace: Supply chain disruption and possible impact on low  technology readiness level programmes or legacy support programmes in favour of active production lines. US Airforce modernisation strategy could be impacted.


Land platforms: Little impact on programmes so far. Higher levels of domestic capability compared to naval and aerospace and less regulated supply chains means future readjustment should be easier and quicker.


Cyber & IT: Military cybersecurity IT subsectors well positioned in the medium terms due to demands on distributed working and secure collaboration. Logistic IT specialists also stand to benefit, with new enterprise resource planning implementations.

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