The World Finance 100 recognises the businesses and individuals that have forged a pathway to success in 2020, even amid the most challenging of circumstances
Where to even begin with the year that was 2020? There is no way to really do justice to the upheaval the world has witnessed this year, with all of our lives – both personal and professional – completely transformed by the events of the past eight months. The word ‘unprecedented’ has been inescapable since the onset of the pandemic but is perhaps the only accurate way to describe the once-in-a-lifetime set of circumstances we have found ourselves in during 2020. The first year of the new decade was already due to be a significant one, with landmark events such as Britain’s legal exit from the European Union at the end of January, and the hotly contested US Presidential election in November. But these long-anticipated occasions were quickly pushed to the sidelines with the sudden arrival of the COVID-19 pandemic in the early spring. It is impossible to overstate the speed with which the virus – and indeed, the measures put in place to contain it – completely transformed the world as we know it. The global economy is predicted to shrink by at least three percent in 2020, marking the worst decline since the Great Depression of the 1930s. Even now, with the first glimmers of hope for a vaccine roll-out, it’s clear that we are living in a changed world. The events of 2020 will shape the global economic outlook for decades to come, and for many firms, their future success will hinge on how they react to the crises of today. In this year’s World Finance 100, we recognise those companies that have not just survived, but thrived against all odds, in what has certainly been the most challenging and unpredictable 12 months in recent history.
When reports first started circulating of a new virus emerging in China, it barely made the the TV news. But as the weeks went on, it became apparent that the situation was much more serious than we might first have thought. Footage showed trucks spraying disinfectant through entire areas of the virus epicentre of Wuhan, and the world watched in amazement as the sprawling metropolis of nine million people was placed under a strict lockdown. Even as the virus began sweeping into Europe in February, few people thought that the rest of the world would follow the draconian containment measures implemented by China – the economic, social and logistical costs would surely be too severe. As the situation worsened, however, and infection rates started to soar across the globe, one by one, entire countries began to shut down. By early April, over 100 nations had imposed some form of national or localised lockdown, affecting billions of people across the globe. The severity of restrictions varied from country to country, but globally the message was clear: stay at home wherever possible, and stay away from others. Weeks of lockdown quickly turned into months, with shops, restaurants, gyms, schools and offices all remaining shuttered. As much of the world whiled away a whole summer indoors, China was already finding its post-pandemic feet. After a strict 76-day lockdown, Wuhan was cautiously reopened in mid-April – just as COVID restrictions hit their most severe across Europe, Australasia and Latin America.“The events of 2020 will shape the global economic outlook for decades to come, and for many firms, their future success will hinge on how they react to the crises of today”
Elsewhere in China, meanwhile, other cities were spared the stringent restrictions imposed on Wuhan, with the government taking more of a targeted approach to containing the virus, avoiding a full national lockdown and swiftly implementing an effective track-and-trace system to manage new clusters of infections. By concentrating efforts where they are most needed, China has managed to control regional flare-ups and keep the country open. Since returning to work in April, its citizens have been spared the stop-start repeated lockdowns that have hampered Europe in the second part of this year, and the nation’s economy has rebounded strongly, growing by 4.9 percent between July and September.
Similarly, elsewhere in Asia, a focus on test-and-trace strategies has seen other nations also escape the worst economic fall-out of the Coronavirus pandemic. Vietnam, with its commitment to contact tracing, is one of very few countries in the world currently experiencing GDP growth, with its economy set to expand by 2.8 percent by the end of 2020. South Korea, too, is due to experience an economic contraction of just one percent, making it the second-best performing major economy in the world behind China. As we move into 2021, it seems that it will be Asia’s economies that will be leading the world’s long, slow recovery from COVID-19.
The COVID quagmire
While China’s test-and-trace system has allowed it to effectively control the spread of the virus, the same thing can’t be said for Europe or the US. Western leaders have struggled to keep case numbers down – even after lengthy and restrictive lockdowns in most of Europe – meaning that the virus has had a devastating effect on both public health and the economy across both continents. The US and the Eurozone experienced historic collapses in economic output in the first half of 2020, with GDP shrinking by 10.2 percent in the US and 14.3 percent in the EU as a whole. Individually, certain European nations fared even worse, with Spain’s GDP shrinking by 22.7 percent, and the UK not far behind with an economic contraction of 22.1 percent. Both countries have joined the likes of Italy, Germany and France in reintroducing tighter restrictive measures in the face of rising infections, with the first round of lockdowns failing to have a long-lasting impact on reducing transmissions. The stop-start nature of lockdown measures across Europe has plunged businesses into a prolonged period of uncertainty, with many going to the wall and many more forced to entirely reinvent themselves at great cost, diversifying their offerings and services in order to stay afloat and comply with the new COVID-related restrictions.
Despite the absence of any nation-level orders on Coronavirus, the US has also seen a significant decline in its economic activity, with the effects of voluntary social distancing and consumer behavioural changes taking their toll on the nation’s GDP. The outlook for 2021 is slightly brighter for the US than it is for Europe, with the States expected to experience a swift, sharp recovery period in the first few months of next year. However, the lack of an effective test-and-trace system means that recovery across both regions largely hinges on the development and deployment of a vaccine, which, despite some very promising updates from testing labs around the world, remains an unguaranteed ‘magic wand’ solution at this time.
The winner takes it all
Just as some nations have fared better than others, certain sectors have also proved more resilient to the COVID-19 crisis. Inevitably, service sectors that tend to be more dependent on face-to-face interactions – retail, hospitality and arts and entertainment, for example – have been dealt a particularly cruel blow this year with the introduction of mandatory social distancing measures. Many of these businesses and venues have struggled to keep the wolf from the door after months of vastly reduced income. At the other end of the scale, meanwhile, are those sectors that have actually profited from the pandemic.
Unsurprisingly, as the real world has given way to the virtual one during repeated lockdowns, Big Tech has enjoyed record success this year. With millions of people effectively confined to their homes for many months, digital activity has soared, meaning that e-commerce, online streaming and cloud computing companies have all earned a pretty penny thanks to the pandemic. Amazon reported a record profit of $5.2bn in the second quarter of the year, while its cloud computing division, Amazon Web Services, recorded revenues of $10.8bn for the quarter, largely boosted by companies shifting from the office to online. Entertainment juggernaut Netflix added 15.8 million paying customers to its roster between January and March, and Facebook saw its revenue rise by 10 percent to $18.3bn in the second quarter of the year, even amid an advertising boycott. Financially speaking, the tech giants have been the real winners of this pandemic, and with WFH here to stay – certainly in the near future, at least – their profits are set only to soar in the months to come.
As we say goodbye and good riddance to what has been an incredibly challenging year and look ahead to an uncertain future, we are honouring the most resilient, forward-thinking firms that have shown tremendous tenacity in these testing times.
Congratulations to each and every member who made the final listings for the World Finance 100.