Viola Davis, Inside Out – Forecast update: Lower growth and higher inflation by Bank J. Safra Sarasin – WTO: Russia-Ukraine conflict puts fragile global trade recovery at risk

The TextileFuture Newsletter will be somewhat short because of the Easter Holidays.

We let you have two items of economic content, with fact and figures. Both reduce the growth rates for 2022 in their forecast.

However, the first item shows the life of actress “Viola Davis, Inside Out”. How she drew on a life of private hardship to become one of the greatest actors of her generation. It is written by guest author Jazmine Hughes from the New York Times Magazine.

The second freature is Cross Week Assets by Bank J. Safra Sarasin” on the latest facts and figures.

The third item covers the latest figures on trade and is entitled “WTO: Russia-Ukraine conflict puts fragile global trade recovery at risk”

We at TextileFuture have chosen these items because of their actuality.

We wish you an excellent return to work after the relaxing holidays, and please, don’t forget to return to TextileFuture next Tuesday for the new edition of the Newsletter.

 

This is the beginning of the first item:

Viola Davis, Inside Out

How she drew on a life of private hardship to become one of the greatest actors of her generation.

By guest author Jazmine Hughes from the New York Times Magazine. Jazmine Hughes is a Metro reporter and a staff writer for The New York Times Magazine.

Ruven Afanador is a Colombian-born photographer based in New York. He currently has an exhibition at the Fahey/Klein Gallery in Los Angeles featuring the photographs he took for the magazine’s Great Performers Issue from December.

For a month, Viola Davis had been stuck. In the spring of 2020, in the late nights of lockdown, she set out to write her memoir. She had her routine: Get out of bed in the middle of the night, make herself a cup of tea, start writing in her movie room, fall asleep in one of its leather recliners, wake up, write some more, nod off again. But for weeks, she couldn’t figure out exactly where to begin. Should she start with her life as a celebrity, or the beauty contest she lost when she was a child, or the fact that people always wanted to hug her when they ran into her in public? Nothing worked.

Then one night, a conversation she had years ago with Will Smith on the set of “Suicide Squad” came floating back into her consciousness. He asked her who she really was, if she had been honest enough with herself to know the answer. She was 50 at the time and replied confidently, indignantly, that yes, she knew. He tried again, saying: “Look, I’m always going to be that 15-year-old boy whose girlfriend broke up with him. That’s always going to be me. So, who are you?”

A memory returned to her. When she was in third grade, a group of eight or nine boys made a game out of chasing her home at the end of the school day. They would taunt her, yelling insults and slurs, throwing stones and bricks at her, while she ducked and dodged and wept.

One day, the boys caught her. Her shoes were worn through to the bottom, which slowed her down. (Usually she would run barefoot, her shoes in her hands, but it was winter in Central Falls, R.I., where she grew up.) The boys pinned her arms back and took her to their ringleader, who would decide what to do with her next. They were all white, except for the ringleader. He was a Cape Verdean boy who identified as Portuguese to differentiate himself from African Americans, despite being nearly the same shade as Davis. Unlike her, he could use his foreign birth to distance himself from the town’s racism: He wasn’t like those Black people.

“She’s ugly!” he said. “Black fucking nigger.”

“I don’t know why you’re saying that to me,” she said. “You’re Black, too!”

Time slowed down. The ringleader howled in fury, screaming that he wasn’t Black at all, that she should never let him hear her call him that again. He punched her, and the rest of the boys threw her onto the ground and kicked snow on her.

By the time Davis and Smith had that conversation in 2015, she was a bona fide star: She had been nominated for two Oscars, won two Tonys and was playing the lead role in a network television show, “How to Get Away with Murder.” (“Hell, Oprah knew who I was,” she writes.) But in that conversation, she realized that not only had she remained that terrified little girl, tormented for the color of her skin, but that she also defined herself by that fear. All these years later, she was still running, trying to dodge the myriad tribulations — anti-Blackness, colorism, racism, classism, misogyny — that she had faced, other people’s problems with her. Davis’s early life is dark and unnerving, full of blood, bruises, loss, grief, death, trauma. But that day after school was perhaps her most wounding memory: It was the first time her spirit and heart were broken. She had her beginning.

To watch Davis act is to witness a deep-sea plunge into a feeling: Even when her characters are opaque, you can sense her under the surface, empathetic and searching. This skill has been on display since the beginning of her film career, when she garnered award nominations for performances that were fewer than 15 minutes long. There’s an industry achievement called the Triple Crown of Acting: an actor winning an Oscar, an Emmy and a Tony. Only 24 actors hold the title, and Davis is the only African American.

Davis is also, then, a member of the small troupe of former theater actors who have made the jump to movie stardom, and you can recognize that gravitas, that same finesse that makes me sit up straighter whenever I see James Earl Jones onscreen. But there is also vulnerability alongside her poise. The more time I spent with her, the more I wondered if, by embodying someone else’s tragedies, she was able to wrench her own to the surface. Reading her memoir, “Finding Me,” which is being published on April 26, you understand where her ability comes from: Only someone who has already been dragged into the depths of emotion readily knows how to get back there.

Davis told me that there’s so much vanity in Hollywood that she thinks people are afraid to take the nonpretty roles. “It’s more important for me to see the mess and the imperfection along with the beauty and all of that, for me to feel validated,” she said. “If it’s not there, then I feel, once again, the same way I felt when I was keeping secrets as a kid. But the only reason to keep secrets is because of shame. I don’t want to do that anymore.”

In one of our first conversations, Davis described the difference between method acting, which requires a performer to completely subsume herself into the life of her character, and a more technical approach that might, say, rely on breathing techniques to be able to readily cry. “I believe in the marriage of both, because I want to go home at the end of the day,” she said. She thinks that actors need to study life itself. Feelings are never simple; the mind wanders off track. “I always use this example of when my dad died, and we were devastated,” she told me. But at the wake, when people streamed through the doors to pay their respects, “it became this big reunion of laughing and remembering — real laughter to real joy, then tears. But I was observing my thoughts, and I went from being devastated one moment to thinking about what I was going to eat.” It’s like a Chekhov play: You can’t tell the story of the joy without telling the story of the pain alongside it.

“Your thoughts go every which way,” she said. “They run the gamut. There’s a wide berth of life. It’s like, as soon as you think your life is falling apart, then you’re laughing hysterically. That’s how life works.”

Davis was born in 1965 on a plantation in South Carolina. Her grandparents were sharecroppers who raised 11 children in a single-room house. Mae Alice and Dan Davis, her parents, moved Viola and two of her older siblings to Rhode Island soon after Davis’s birth, so that her father could find a better job. Dan was a well-regarded but underpaid horse groomer. He also regularly abused his wife after drinking binges, stabbing her in the neck with a pencil or thrashing her with a wood plank. Sometimes Davis would arrive home and see droplets of blood leading to the front door; at least once, Dan asked his daughters to help him look for their mother, who had run away in the middle of a beating, so he could kill her.

The family rarely had heat, hot water, gas, soap, a working phone or a toilet that flushed. Rats overtook their home, so ravenous that they ate the faces off Davis’s dolls. She and sisters would tie bedsheets around their necks before they went to sleep to stave off rat bites. Her father often beat her mother at night, and Davis started wetting the bed, a habit she didn’t break until she was a teenager. The conditions of her home meant that she often couldn’t wash up or change into another set of clean clothes. A teacher shamed her about her hygiene but never asked the root cause. Other teachers just ignored her: One day, Davis raised her hand to go to the bathroom, but the teacher never called on her, so she peed in the seat. The teacher sent her home, and the next day, when she arrived back at her desk, the urine was still pooled in her chair. Davis surmised that she was so disgusting that even the janitor didn’t want to clean her mess. She was 6 years old.

Her sisters were her anchor. The eldest, Dianne, had recently reunited with her siblings, moving from their grandparents’ home in the South, and Viola was obsessed with her. She had a new coat and pocket change, and she smelled nice. It was the first time Dianne saw how the rest of her family lived, and she decided that her baby sister needed to get out. She whispered to Viola: “You need to have a really clear idea of how you’re going to make it out if you don’t want to be poor for the rest of your life. You have to decide what you want to be. Then you have to work really hard.”

One evening, Davis sat watching TV, the working set sitting atop a broken one, connected to an extension cord from one of the few functioning outlets in her home. “The Autobiography of Miss Jane Pittman” came on, and for the first time, Davis saw a dark-skinned woman, with full lips and a short Afro, on the screen. She thought the woman was beautiful; she thought the woman looked just like her mother. “My heart stopped beating,” she writes. “It was like a hand reached for mine, and I finally saw my way out.” Dianne had made clear that Viola could be somebody. Cicely Tyson was somebody Viola could be.

When she was 14, Davis intervened in one of her parents’ fights for the first time. Her father stood opposite his wife, screaming and carrying on, a drinking glass in his hand like a dare. “ ‘Tell me I won’t bust yo’ head open, Mae Alice? Tell me I won’t?’” she writes. Davis tried to cut in, her 18-month-old sister in her arms, calmly pleading for him to stop.

Dan lifted his arm and smashed the glass onto Mae Alice’s face. A shard sliced her temple. As he moved to swing again, Davis yelled. Dan froze, still gripping the glass. “I screamed, ‘Give it to me!’” she writes. “Screaming as if the louder I became the more my fear would be released.” It worked. Her father handed Viola the glass, and she stashed it away.

Davis grew up to be the sort of actor whose range feels best measured by her steady command of pressure: maintaining it, raising it, letting it go. She sets the tone of every scene, the eyes of her castmates flicking toward her as soon as she appears, as if reacting to her is a crucial part of the job. She often plays characters who cry only in the moments she’s inhabiting, weeping as if it were a rare, almost undignified departure from their norm. Her name has become internet shorthand for dramatic crying: After an episode of HBO’s “Euphoria” this winter in which Zendaya sobbed and snotted her way through a scene, she drew enthusiastic comparisons to Davis. Davis doesn’t cry so much as she leaks, her eyes and nose like faucets. During her performance as Mrs. Miller in the 2008 movie “Doubt,” she cries one drop at a time. Her tears hang over the edges of her lashes; a single teardrop stays on its precipice for 15 seconds. Mucus runs down her face undisturbed for two minutes, an eternity, its very presence signaling something terribly wrong. In the 2016 film adaptation of “Fences,” when her character unloads her stymied dreams onto her husband, her curled upper lip is no match for the snot dripping down her face.

In real life, Davis doesn’t cry that much. “As a matter of fact, if someone confronted me with something, I would probably come at them with more unbridled anger than tears,” she said one March afternoon at her home in Los Angeles. When I arrived, her dog, Bailey, greeted me with an enthusiastic familiarity; Davis laughed and wondered aloud whether he thought I was her sister. Eventually, we made our way to the movie room, where she sat curled up under a plush blanket. She wore a dark head wrap knotted in the front and a key-lime linen jumpsuit. Davis is goofy and surprisingly coarse (her favorite swear words, she said, are basically unchanged from when she was 8), and looking at her, it was difficult to imagine that anyone had ever doubted her beauty.

In order for Davis to descend into a new character, she told me, she first has to become a “human whisperer,” inviting the person into her life and making space for her revelations. She’s the vessel, not the creator. From a script, an actor may learn only the broad strokes of her character, and the rest is up to her to intuit. “You begin to ask your questions based on those facts,” Davis said. Say your character is 300 pounds. “ ‘Why are you so big?’ ‘Oh, I eat too much.’ ‘Well, why do you eat too much?’ ‘Because it comforts me.’ ‘Well, why does it comfort you?’ ‘Because I have a lot of anxiety.’ ‘Why do you have a lot of anxiety?’ ‘Because I was sexually abused when I was 5. And every time I go to bed at night, I think about that sexual abuse, and I can’t go to sleep, so I eat.’” She punched the air. “Bam. You have a character. Keep asking why.” This has sometimes led her to doing intensive preparation, even for minor roles. After three weeks of rehearsals for “Doubt,” for example, she still wasn’t able to figure out Mrs. Miller. She went home and wrote a 100-page biography of the character, finally cracking her open after a discussion with a college professor, who explained why a mother would turn a blind eye to a priest abusing her son: She had no other choice. The bigger threat to her son’s well-being was his homophobic father, who might kill him if he found out he was gay. She was protecting her son the only way she knew how.

Denzel Washington directed Davis as an absent mother in the 2002 film “Antwone Fisher” and in “Fences,” in which he also co-starred, and he spoke of her work with deep respect. “Acting is investigative journalism, and we interpret the world differently,” he said. “The beginning work is similar: You circle the subject, your character.” Washington studied journalism at Fordham University, but he learned this strategy, he said, from Carl Bernstein and Bob Woodward, whom he met while researching a role. “She, as an actress, will circle. I don’t know if she goes inside out or outside in, but you circle it, for lack of a better word, and she makes it her own, and you can’t take it from her, and you better keep up with her.”

Talking to Davis about herself feels both analytical and spiritual, as if a flower child went to therapy. When she described how she emotes, she kept likening herself to a prehistoric man, standing at the edge of an ocean, slowly gaining sentience: “ ‘Who the hell am I?’” she said. “ ‘Who made me? Is there someone out there who I can talk to? Who loves me? Why do I have feet? Can I speak?’” Davis told me that too often the artistic representations of Black people are flattened into pure devices, who, say, inspire the white heroine, or comfort the white heroine, or support the white heroine’s decision to get a divorce and fly to Bali. Early in her career, she was relegated to those sorts of parts, so she tried to sneak a bit of humanity into her scenes, giving unmemorable stereotypes some life.

The author Zora Neale Hurston argued that Black life in fiction should be so realistic that it feels like eavesdropping; true authenticity would encapsulate a feeling of discovery. Davis embodies this in her acting: It can seem so truthful that it feels almost uncomfortable, as if you’ve barged in on something you weren’t supposed to see. By going slightly too far, letting her tears drip uninterrupted, she lets you in on a secret no one else will tell.

Soon after she saw Cicely Tyson on television, Davis and her three older sisters entered a local contest with a skit they based on the game show “Let’s Make a Deal.” They won — gift certificates and a softball set, including a bat that they used to kill rats in their home. But for Davis, the real prize was recognition — not just of her talent but of her personhood. She writes: “We weren’t interested in the softball set. We just wanted to win. We wanted to be somebody. We wanted to be SOMEBODY.”

When she was 14, she participated in an Upward Bound program for low-income high school students, where an acting coach encouraged her to pursue acting professionally. Later, a teacher recommended she apply to a national performing-arts competition. She auditioned with two pieces from “Everyman” and “Runaways,” which, she writes, “had a lot of great monologues about feeling abandoned.” She was flown out to Miami for the contest, where she was named a promising young artist. Eventually, she studied theater at Rhode Island College. For money, she took multiple buses to her hometown, worked a few shifts at the local drugstore, slept on her parents’ floor and then headed back to school in the morning.

After graduation, Davis wanted more training, but she could afford to apply to only one conservatory. She chose the Juilliard School, squeezing in her afternoon audition in New York before performing in her first professional production that evening in Rhode Island. “I just thought you should know, I’ve got 45 minutes,” she told the faculty. She didn’t realize the audition process typically took three days. She explained the situation, the train she absolutely had to catch. “You have to tell me whether I’m in or out.” She got in.

But after enrolling at Juilliard, she felt trapped, limited by its strictly Eurocentric approach. She spent her days squeezing herself into corsets or powdered wigs that never fit over her braids, listening to classmates ponder how good life would have been in the 18th century, an imaginative game enjoyable only for white people. Juilliard was about shaping a student into a “perfect white actor,” she writes. “The absolute shameful objective of this training was clear — make every aspect of your Blackness disappear. How the hell do I do that? And more importantly, WHY??!!!”

She applied for a scholarship that would allow her to spend the summer in Gambia. In her application essay, Davis wrote about the burden of performing material that wasn’t written for people like herself. There was no cultural connection or recognition — she felt lost and uninspired. That summer, she was on a flight to West Africa, with a group of people who wanted to study the music, dance and folklore of various tribes.

Immediately after landing, she fell in love: the ocean wind, the faint smell of incense, the oranges and purples of twilight. The people of the Mandinka tribe, with whom she visited, embraced her group like family. She went to a baby-naming ceremony, a wrestling match; she watched as women drummed and danced. Her fixation with “classical training” melted away. Finally, after years of acting, she was witnessing art, true genius. “I left Africa 15 pounds lighter, four shades darker and so shifted that I couldn’t go back to what was,” she writes.

Her time at Juilliard was ending, and she was eager to jump into a new chapter of her life, but all the roles she auditioned for — even in Black productions — were limiting: The only roles she was being seriously considered for were drug addicts. She tried out for other parts, but casting directors thought she was “too dark” and “not classically beautiful” enough to play a romantic lead.

A few plays came her way, but she barely made enough money to live on, let alone pay off her tens of thousands of dollars in student loans. She survived on white rice from a Chinese restaurant, with $3 wings if she could afford it; she slept on a futon on the floor of a shared room.

Her agent asked her to audition for the touring company of August Wilson’s “Seven Guitars,” for the role of the strong-willed and guarded Vera, who must decide if she can trust her cheating ex-boyfriend again. She got the part, and after touring for a year, she made her Broadway debut. She received a Tony nomination for the role, but her life was hardly glamorous. A few of her siblings, she writes, were struggling with drugs or money issues, and her parents, still together, cared for some of their children. Davis sent home as much money as she could, racked with a sort of survivor’s guilt. “If I saved anyone, I had found my purpose, and that was the way it was supposed to work,” she said. “You make it out and go back to pull everyone else out.”

After her success in “Seven Guitars,” theater parts came steadily, and she finally made enough money to afford premium health insurance. An operation to remove nine uterine fibroids gave her a small window of fertility. She was in her early 30s, and every child she passed on the street made her want her own, but she had been in only two relationships, neither of them any good, and there was no one on the horizon. One of her castmates in a production of “A Raisin in the Sun” encouraged her to ask God for a nice man. One night, she got down on her knees: “God, you have not heard from me in a long time. I know you’re surprised. My name is Viola Davis.” She went through her requests: a Black man, a former athlete, someone from the country, someone who already had children. A few weeks later, on the set of a television show, Julius Tennon — a handsome, divorced Black actor from Texas with two grown children — played opposite her in a scene.

Within four years, they were married. But the reproductive challenges kept coming: She had a myomectomy, this time to remove 33 fibroids. It felt as though the women in her family were cursed. Two of her sisters nearly bled to death after labor and had hysterectomies. Some years later, she had one, too — during an operation on an abscessed fallopian tube. (Before going under, she told the surgeon, “Let me tell you something, if I wake up and my uterus is still here, I’m going to kick your ass.”) With Tennon, she eventually adopted a daughter, Genesis, inspired by the fellow actress Lorraine Toussaint, who adopted a child because she didn’t want “series regular” to be the only words on her tombstone.

After years of therapy, Davis healed her relationship with her father, who had transformed into a docile, sweet older man trying to make amends for his past; he spent the last years of his life catering to the needs of his wife and family, as if every single one of his remaining days could be an apology. Some films floated her way, but none of the material was particularly meaty.

Then, in 2007, Davis beat out five other actresses — Audra McDonald, Sanaa Lathan, Taraji P. Henson, Sophie Okonedo and Adriane Lenox — for the role of Mrs. Miller in “Doubt.” It was more than 5-year-old Davis could’ve dreamed: acting opposite Meryl Streep, being directed by John Patrick Shanley, working on a prestige film. Davis had finally reached the summit desired by so many professional actors — awards bait. Of her performance, the film critic Roger Ebert wrote: “It lasts about 10 minutes, but it is the emotional heart and soul of ‘Doubt,’ and if Viola Davis isn’t nominated by the Academy, an injustice will have been done. She goes face to face with the pre-eminent film actress of this generation, and it is a confrontation of two equals that generates terrifying power.”

There was no injustice: Davis was nominated for best actress in a supporting role, though she lost. Then in 2010, she won her second Tony, for playing Rose Maxson in “Fences.” The next year, she starred in “The Help.” Davis played Aibileen Clark, a maid working for a white socialite in the 1960s in Jackson, Miss., who shared her stories of racism and mistreatment with a young, progressive white female reporter. The film, one of the most successful endeavors of the white-savior genre, was nominated for four Oscars, including one for Davis for best actress. After “The Help,” Davis had two Tony Awards, two Screen Actors Guild Awards and two Oscar nominations — and no offers for leading roles. People would call with a few days of filming here, a few days there. Her life had changed, but Hollywood hadn’t much. She still felt sidelined for her skin tone.

But then she got a call from Shonda Rhimes. She and Peter Nowalk were developing a sexy, soapy prime-time drama for ABC, “How to Get Away with Murder,” and they offered Davis the lead role as Annalise Keating. (In an email, Rhimes wrote that she was shocked when Davis, their dream choice, agreed to a meeting. “I remember saying we may as well ask and let her say no so at least we can say that we asked.”) Before the series, Davis’s biggest roles had been strong, tough, sharp but sexually neutered women, as if the deepness of her skin tone and her sensuality were inversely correlated. A friend told her she overheard some male and female actors, all Black, saying she wasn’t pretty enough to pull it off. For the first time in her professional career, Davis couldn’t shake all the racial criticisms she had heard over her career. She was 47 and terrified. She took the job anyway.

Annalise is a hard-nosed, highly sought-after professor and lawyer; in the pilot, she’s compared to Alan Dershowitz. She has a white academic husband and a Black cop boyfriend and a former female lover. She is also maybe a sociopath. The way Davis tried to make Annalise realistic was to have her become completely different in private than she was in public. Before accepting the role, Davis asked that they write a scene in which Annalise removed her wig and makeup, which became the most memorable scene in the series’s run. “The TV and film business is saturated with people who think they’re writing something human when it’s really a gimmick,” she writes. “But if I took the wig off in a brutal, private moment and took off the makeup, it would force them to write for THAT woman.”

Davis won an Emmy and a Screen Actors Guild Award for her work that season and has since moved from success to success. There was finally an Oscar for her performance in the movie version of “Fences.” She was cast in a recurring role in the D.C. Comics “Suicide Squad” franchise and continued to be able to play characters with the depth she craved, including the fearless Veronica Rawlings in “Widows” and the cantankerous diva Ma Rainey in “Ma Rainey’s Black Bottom,” which earned her a fourth Oscar nomination last year. She and her husband used the production company they started, JuVee Productions, to work on their own projects, including “The Woman King,” a historical epic about the all-female army of the Dahomey Kingdom that has been pitched as a Black female “Braveheart,” which premieres in the fall. This month, Davis stars as Michelle Obama in the Showtime series “The First Lady.”

When I spoke with Denzel Washington, he described a conversation with his daughter before she auditioned for the acting program at New York University. She had performed a dry run of her monologue for him. He told her he had good news and bad. The good: She was talented. The bad: “It’s going to be harder for you,” he said. “Because you’re not the skinny light-skinned chick.” He told her that casting directors wouldn’t want to see her in substantial roles, that they would want to cast her as a friend or a sidekick. His advice? “Just follow Viola Davis,” he said. “Look at what she’s doing, and know that, on the other side of it, even if it takes longer, you can be where she is.”

Early in her career, after a performance of Wilson’s “Seven Guitars” — “absolutely an Everyman tragedy story,” Davis said — she and the rest of her cast, all Black, hosted a talk-back. A white audience member, she recalls, asked why he should have to care about the lead character: “It’s not like he’s James Brown or anyone famous.” (Davis would later go on to play Brown’s mother, Susie, in a 2014 biopic of the singer.) “I don’t think I’ll ever forget that,” she told me. “I don’t think that people see the value in a lot of Black people unless you made it into a history book. I don’t think they think your life matters. I don’t think they feel like you’re interesting if you’re ordinary. And that is, absolutely, without question, not the case with white people.”

Zora Neale Hurston might’ve called this a confinement “to the spectacular,” or focusing so much on uplifting the race from its oppressive shackles that you start to mythologize it. Sure, race is always relevant, and stories that use it as a prism are largely edifying, giving dimension to the figures in our history books. “I think our response as Black people — and I get it, from so many years of oppression and dehumanization — has been about putting images out there that are positive and likable and beautiful,” Davis said. But it’s an overcorrection, she cautioned, a glossing over: “That image and message shouldn’t be more important than the truth.”

The challenge for the Black artist, she says, is that “the audience they’re trying to usually reach are not people who look like us, and not people who get us, and not people who know who we are.” Acting, as Davis repeatedly told me, is about portraying people living life. Contemporary Black dramas often posit that Black lives are either secondary (best friends, drug dealers, therapists) or extraordinary (healers, fighters, heroes), when life is rarely one or the other. Davis fills in the in-between, rescuing stories from the restrictive imagination of whiteness: She plays the truth, and we see it reflected back at us in our shade.

Over her career, she has become the sort of celebrity you want to claim as distant family; maybe whatever greatness runs through her veins also runs through your own. Without exaggeration, every single Black person I told about this article asked me to tell Davis hello — not that they loved her work or that they were a fan, just to pass along a greeting, as if they were extending a conversation they had long been having. The beauty of Blackness is the myth that across diasporic differences, we’re all part of the same extensive, sprawling, complicated family, accountable to and for one another. It’s impossible, of course, but in the face of entrenched dehumanization, it feels necessary, the relief in the knowledge of a “we.” It’s easy to root for her when her wins feel like your own.

Davis won an Emmy and a Screen Actors Guild Award for her work that season and has since moved from success to success. There was finally an Oscar for her performance in the movie version of “Fences.” She was cast in a recurring role in the D.C. Comics “Suicide Squad” franchise and continued to be able to play characters with the depth she craved, including the fearless Veronica Rawlings in “Widows” and the cantankerous diva Ma Rainey in “Ma Rainey’s Black Bottom,” which earned her a fourth Oscar nomination last year. She and her husband used the production company they started, JuVee Productions, to work on their own projects, including “The Woman King,” a historical epic about the all-female army of the Dahomey Kingdom that has been pitched as a Black female “Braveheart,” which premieres in the fall. This month, Davis stars as Michelle Obama in the Showtime series “The First Lady.”

When I spoke with Denzel Washington, he described a conversation with his daughter before she auditioned for the acting program at New York University. She had performed a dry run of her monologue for him. He told her he had good news and bad. The good: She was talented. The bad: “It’s going to be harder for you,” he said. “Because you’re not the skinny light-skinned chick.” He told her that casting directors wouldn’t want to see her in substantial roles, that they would want to cast her as a friend or a sidekick. His advice? “Just follow Viola Davis,” he said. “Look at what she’s doing, and know that, on the other side of it, even if it takes longer, you can be where she is.”

Early in her career, after a performance of Wilson’s “Seven Guitars” — “absolutely an Everyman tragedy story,” Davis said — she and the rest of her cast, all Black, hosted a talk-back. A white audience member, she recalls, asked why he should have to care about the lead character: “It’s not like he’s James Brown or anyone famous.” (Davis would later go on to play Brown’s mother, Susie, in a 2014 biopic of the singer.) “I don’t think I’ll ever forget that,” she told me. “I don’t think that people see the value in a lot of Black people unless you made it into a history book. I don’t think they think your life matters. I don’t think they feel like you’re interesting if you’re ordinary. And that is, absolutely, without question, not the case with white people.”

Zora Neale Hurston might’ve called this a confinement “to the spectacular,” or focusing so much on uplifting the race from its oppressive shackles that you start to mythologize it. Sure, race is always relevant, and stories that use it as a prism are largely edifying, giving dimension to the figures in our history books. “I think our response as Black people — and I get it, from so many years of oppression and dehumanization — has been about putting images out there that are positive and likable and beautiful,” Davis said. But it’s an overcorrection, she cautioned, a glossing over: “That image and message shouldn’t be more important than the truth.”

The challenge for the Black artist, she says, is that “the audience they’re trying to usually reach are not people who look like us, and not people who get us, and not people who know who we are.” Acting, as Davis repeatedly told me, is about portraying people living life. Contemporary Black dramas often posit that Black lives are either secondary (best friends, drug dealers, therapists) or extraordinary (healers, fighters, heroes), when life is rarely one or the other. Davis fills in the in-between, rescuing stories from the restrictive imagination of whiteness: She plays the truth, and we see it reflected back at us in our shade.

Over her career, she has become the sort of celebrity you want to claim as distant family; maybe whatever greatness runs through her veins also runs through your own. Without exaggeration, every single Black person I told about this article asked me to tell Davis hello — not that they loved her work or that they were a fan, just to pass along a greeting, as if they were extending a conversation they had long been having. The beauty of Blackness is the myth that across diasporic differences, we’re all part of the same extensive, sprawling, complicated family, accountable to and for one another. It’s impossible, of course, but in the face of entrenched dehumanization, it feels necessary, the relief in the knowledge of a “we.” It’s easy to root for her when her wins feel like your own.

For years, I watched “How to Get Away With Murder” every single week, for no discernible reason. In 2014, when it premiered, I had only a passing familiarity with Davis, had never seen any of Rhimes’s other work and hadn’t watched much network television since the finale of “30 Rock.” (I also hadn’t seen the article in this newspaper that called Davis “less classically beautiful” than Kerry Washington.) But something compelled me to keep with it. It wasn’t as simple as being drawn to Davis because we slightly resemble each other, but I liked that the character kept surprising me, twisting away from what I expected. A product of Shondaland, Annalise had an absurd inner life, and everyone around her couldn’t stop getting murdered, but she had an inner life! She had flaws and no eyebrows and real, traumatic issues with her family and sometimes bad wigs. Annalise wasn’t an inspiration; she was neither a stereotype nor a gimmick, neither a white writers’ room’s stab at a Black person nor a tortured Black person’s idea of what dark-skinned women are like. She was a person.

Davis’s ascent feels like delicious revenge, an “I’ll show you,” pushing past obstacles like a rose through concrete. She fought her way to a position where she could demand the same respect denied to her in her childhood. It’s the same respect denied to her mother, repeatedly beaten; to her grandparents, who had to stuff all their dreams into a one-room house on a white man’s land. It’s the same respect long denied to Black women, especially dark-skinned ones.

Each time I finished an interview with Davis, she escorted me outside and waited with me until my car arrived. In Los Angeles, we hugged goodbye. Out the window, I could see she had taken a familiar stance — legs spread wide, hips jutting forward, one hand on her back, the other waving — as she watched the car drive off, waiting until it passed her house before she went back inside. The Uber driver, a Black man, turned and asked me, “Is that your mom?” I laughed and said no, but admitted that we do sort of look alike, so I could see why he asked. It wasn’t just that, he said: As soon as he pulled up, she was watching him closely, as if she were wondering if she could trust him enough to keep me safe.

One day last February, I joined Davis on location about an hour outside Cape Town as she wrapped up filming “The Woman King.” Dozens of extras, all brown- and dark-skinned, congregated in the set’s main square. They were dressed in thick fabrics of tropical colors, marking their steps. Davis plays Nanisca, the army’s general, and she was filming a victory dance with her warriors. She wore a bandeau, a cape and a printed skirt in an aristocratic purple, with thin golden cuffs on her upper arms and a necklace of shark teeth. Her hair was in a blown-out Afro, with a golden rope securing a small section at the top of her head. While her makeup artist rubbed cream into her back, careful not to disturb a spatter of painted-on scars, she watched the dancers, marking moves along with them using only her forearms and her feet. She rose from her chair and started dancing on her way toward the camera, grinding her hips in precise circles and smirking, eliciting a shower of “AYYYEEE”s from crew members.

The scene they were working on began with a tight shot of Davis watching the dance wistfully from a perch. Her face continuously transformed: In one second, she looked as if she were trying not to smile, then immediately as though she were fighting back tears. She had been filming close shots all day, and her range of emotions was vast but unambiguous: resigned, fearful, disturbed, flummoxed, each change descending onto her face as smoothly as a blind.

Davis cupped the face of the actor playing opposite her, touching their foreheads together, a feud between them finally settled. In one take, she smiled tightly, and for a moment she was washed by disappointment; in another, she clasped her co-star’s face with great intention and smiled wide and sweet. She then turned to face her warriors, already celebrating the end of the battle, and joined the fray. Drummers kept them in a polyrhythm. Her back to the camera, she rolled her hips, her hands thrown to the air. She hiked her knees to her stomach, her feet two-stepping, all her movements light but still rooted to the ground. The dancers circled her, cheering her on. When the director, Gina Prince-Bythewood, yelled “cut,” everyone burst into applause.

For most of the cast, it was the last scene they would film. Davis joined the principals in a group hug, and the dancers, mostly hired locals, began gleefully singing in Xhosa while they danced and embraced one another. When I asked Phumzile Manana, the film’s publicist, if the singing had any significance, she said they were “just keeping vibes alive, I suppose.”

It took Davis six years to get “The Woman King” made, because the studios were reluctant to back a film that featured so many Black women. That they were all dark-skinned — the production cast women from across the diaspora, Black Americans and South Africans and Brits and Jamaicans and West Africans — might have made it even harder. “All praise to ‘Black Panther’ and its success, because that absolutely paved the way for people to see the possibility of this movie,” Prince-Bythewood told me. “‘The Woman King,’” Davis said, “reflected all of the things that the world told me were limiting: Black women with crinkly, curly hair who were darker than a paper bag, who were warriors.”

Seconds after she wrapped her final scene, Davis was in a black robe and Crocs, milling around for pictures and goodbyes before she gave a short speech. “The thing about what we do is that you can be transported back in time,” she said. “You can be whoever you want to be. And, you know, for Black people, sometimes the only thing we’ve had to rely on is our imaginations.”

As she talked about how powerful it was to watch these Black women transform into warriors, a sea of dark faces, crested with braids and fades and Bantu knots, reflected back at her. “What the caterpillar calls the end of the world, the master calls the butterfly,” she told them. “We’ve been so misunderstood. Limited, invisible for so long. And now, people are going to see us be butterflies.”

www.nytimes.com

 

Here starts the second feature:

 

 

Forecast update: Lower growth and higher inflation

We have significantly downgraded our GDP growth forecasts for 2022 and 2023, and upgraded our inflation forecasts on the back of higher commodity prices. In the near term, widespread lockdowns in China (for which we have revised down our 2022 GDP fore-cast to 4.8%) and the indirect impact of the war will hurt global growth. We expect central banks to be more aggressive in order to bring down inflation and approach their targets by the end of next year. Yet, they will only be able to do so by weakening demand signifi-cantly. As a result, the risk of a 2H23 recession has risen significantly.

Fixed Income: We have upgraded our projected yield trajectory somewhat due to higher expected policy rates, but adopted a more constructive view on the asset class. Compared to other asset classes, fixed income has repriced substantially in anticipation of much higher expected policy rates. In combination with much weaker expected growth next year, this suggests that the relative risk/return for fixed income has improved over the past few months, suggesting that it is time to start reducing the current underweight.

FX: The strong rise in energy prices should keep the US dollar and commodity-linked cur-rencies well supported, while non-commodity exporters’ currencies such as the euro and the Japanese yen should continue to suffer. Nevertheless we retain our favourable view on the Swiss franc due to lower inflation and higher real interest rates.

Equities: Finally, we are downgrading our equity targets across the board in line with our more cautious growth forecast and in response to higher rates. We stick to our defensive bias both in terms of regions and sectors. We keep our preference for Japanese equities in Asia, but we remove our preference for Chinese and Emerging Markets equities as the China macro outlook is not improving and more conciliatory words from regulators have not been followed by action. Additionally, we move UK equities back to least preferred, after upgrading them to neutral late last year.

Macro and strategy: forecast update

Lower growth and higher inflation

By guest authors Raphael Olszyna-Marzys International Economist Mali Chivakul Emerging Markets Economist Wolf von Rotberg Equity Strategist Alex Rohner Fixed Income Strategist Claudio Wewel FX Strategist.

Large revisions to our forecasts

We have significantly downgraded our global growth forecasts for 2022 and 2023, as central banks are expected to hike policy rates faster and harder in response to a much higher inflation trajectory. Fixed income markets have repriced substantially in anticipation of more aggressive central bank action. Consequently, we view this asset class less negatively than before. The surge in energy prices should keep the US dollar and commodity-linked currencies well-supported, while non-commodity exporters’ currencies are suffering. Finally, we have downgraded our equity targets due to lower expected growth and higher rates and we retain our preference for defensive markets and sectors.

Global macro

This month, we have  made significant  revisions to our forecasts (see Exhibit  16  at  the  end of the document). We have revised down our growth  outlook  for all  economies  for 2022 and 2023, increased our inflation  forecasts  and expect  most  central  banks to tighten  pol- icy faster and harder than we did previously. Eventually, they  should succeed in  bringing down inflation, but not without inflicting collateral damage to growth and labour markets.

Main changes to our assumptions

These new forecasts reflect some important changes we made to the underlying assumptions in our baseline scenario (Exhibit 1). We now expect sanctions to remain in place for the foreseeable future, keeping many commodity prices elevated. What’s more, the rise in inflation expectations since the start of the war also implies that central banks  cannot afford to ‘look  through’ this  additional supply shock, and will need to tighten policy  rapidly, at least until month-on-month price changes come down to more reasonable levels.These new forecasts reflect some important changes we made to the underlying assumptions in our baseline scenario (Exhibit 1). We now expect sanctions to remain in place for the foreseeable future, keeping many commodity prices elevated. What’s more, the rise in inflation expectations since the start of the war also implies that central banks  cannot afford to ‘look  through’ this  additional supply shock, and will need to tighten policy  rapidly, at least until month-on-month price changes come down to more reasonable levels.

Uncertainty around our central scenario is high and we assign a 30% probability to our downside scenario

The uncertainty around our central scenario is very high, and we have increased our down- side scenario to 30 %, from 25 %, and reduced our upside scenario to 10 %, from 15 %. So far, Europeans have resisted to impose an embargo on Russian oil and gas. But the prob- ability of an embargo is rising as more crimes committed by the Russian army against Ukrainian civilians are being reported in the press.

The European economy will be particularly im pacted by the huge increase in energy prices

As mentioned in previous notes, the war is impacting the rest of the world via higher commodity prices, more supply disruptions and tighter financial conditions. This will be particularly felt in Europe, where natural gas prices are up 200 % so far this year, compared to 2021 levels. In comparison, gas prices in the US have only increased by about 20 %. While US inflation probably reached a peak at 8.5 % in March, we think Euro Area inflation has a bit more to go, and will hit 8.1 % in Q2 (Exhibit 2). Higher energy prices in Europe are hurting businesses’ competitiveness and are depressing households’ purchasing  power.  This is true too in the US, though to a lesser extent. In addition, US oil and gas extraction should pick up over the coming months, boosting growth.

Strict and widespread lockdowns in China will hurt the rest of the world via more supply disruptions and weaker imports

The current slowdown in China (more on China below) adds a layer of complexity to the outlook as it will lead to further disruptions to  supply chains and weaker external demand, at least over the coming month. Again, Europe is likely to suffer more than the US as its economy is more open to the rest of the world.

US growth and inflation to come down towards the latter part of this year and in 2023

Looking towards the end of this year, domestic demand in the US should start to ebb. A lot of the expected tightening by the Fed is already priced in financial markets. Mortgage rates have risen from around 3% at the end of last year to 5%. They are likely to rise some- what further as the Fed rapidly tightens policy. By the end of the year, we expect Fed Funds rates to get to around 2.5%, the Fed’s estimate of the neutral rate, and move to 3% early next year. The balance sheet run-off – an estimated $1trn over the next 12 months – will contribute to tighter financial conditions too. This  should weigh on  residential  investment and building permits. In addition, a slowdown in the residential real estate market should weigh on the consumption of durable goods too. Much softer growth in the US should de- press global growth given that the US economy is a big net importer. Weaker demand, combined with fewer supply constraints, should help bring down inflation.

ECB and SNB to lift off their policy rates in Q3

In Europe, the ECB and the SNB  are also likely to lift-off their policy rate in  Q3  and move them into positive territory next year given the pick-up in core inflation, and rising risks of second-round effects (more  so in  the  euro area  than  in  Switzerland). Overall, we expect the ECB and the SNB to increase rates six and five times respectively between now and the end of 2023. The ECB is likely to announce an end to net asset purchases at its June meeting. Tighter policy in Europe in 2023 will also contribute to weaker aggregate demand.

GDP growth rates to fall significantly below trend by 2H23, with elevated recession risks

In conclusion, advanced economies—particularly the US—will  have  to  digest  a  consider- able amount of tightening in a very short period of time. On top of this, the global economy will have to deal with the fallout from the war in Ukraine, while it is still adjusting from the pandemic shock. Under such circumstances, we  don’t  think  that  central  banks  will  man- age to achieve a ‘soft landing’ of the economy. Instead, central banks—especially  the Fed—are likely to tighten policy until something breaks. In short, we expect growth rates in advanced economies to drop significantly below their trend rates by the second half of 2023, with elevated recession risks (Exhibit 3).

We have downgraded our China growth projection to 4.8 %

We have downgraded our China growth projection from 5.2% to 4.8% following the recent COVID outbreaks and their associated mobility restrictions. As we noted in a recent report – China: Increasing risk of broader lockdown – China continues to struggle to keep rising COVID cases under control, and lockdowns and restrictive measures have been imple- mented across the country as the government is fully committed to its zero-COVID strat- egy. There are some signs that the worst may be over. Most recently the situation seems to have improved as the number of COVID risk areas has come down from its peak and mobility has picked up (Exhibit 4). Shanghai, which has been in a lockdown since the last week of March, has started to relax the restrictions.

Containment measures are taking a toll on the economy

Despite the effort to minimise the economic impact, these containment  measures  are  tak- ing a toll on the economy. The Caixin March PMIs dropped significantly to 48 for manufac- turing and 42 for  Services. Service  sector  indicators, such as  box  office  revenue,  contin- ued to trend down in the first week of April. Mobility restrictions have negatively affected manufacturing logistics as factories cannot obtain their inputs. A recent survey from the German Chamber of Commerce in China, for example, suggests that about half of German companies in China have experienced severe disruptions due to recent COVID restrictions. Indeed, March imports barely grew from a year ago, confirming the weakness in domestic demand and supply chain disruptions (Exhibit 5).  Real  estate  sales  have  also  been  af- fected by the  restrictions.  Sales in the latest  weeks turned even weaker compared to  earlier in the year.

Our projection assumes that COVID outbreaks will be contained by H2

In our projection, we assume that the worst of the outbreak will be in March-April, and that the government will be able to contain it by the second  half  of  the year.  We also assume that credit growth and government spending, especially infrastructure spending, will pic up in Q2-Q3  to compensate  for weak  services  and real  estate  activity. Increasingly, there are signs that the government is worried about the COVID-induced slowdown, with  the central government encouraging local governments to use their  infrastructure  spending quota by September. Credit growth indeed picked up in March, with a strong increase in government borrowing (Exhibit  6). The risk is  skewed to the downside as  stimulus  may not be enough to boost the services sector. China is also subject to secondary sanctions risk as it navigates its relationship with Russia and the West.

Fixed  income

A higher forecast yield trajectory

The substantial upward revision in expected policy rate trajectories has led to an increase in our bond yield forecasts, although to a much smaller degree. In fact, given the substantial downgrade in growth expectations for 2023, we actually  forecast lower  US  Treasury yields for end 2022 and 2023. More generally, we view the fixed income space less  negatively than before, though we acknowledge that over coming months there  may still  be some upside potential to bond yields as inflation concerns are unlikely to go away soon.

The developed markets fixed income space has undergone a substantial repricing

Over the past 12 to 18 months, developed markets’ interest rate structures have repriced substantially. While markets priced very little in terms of implied rate hikes 12 months ago, the  strong and persistent  rise  in  inflation  has led to a furious  surge in  central  bank rate hike expectations over the past few months. Dollar markets are now pricing close to 300bp worth of rate hikes over the next 12 months (Exhibit 7), while even in the euro area, markets are bracing themselves for a rate hike cycle not seen since before the global financial crisis. Incidentally, the fixed income space is the only asset class where such a drastic repricing has taken place.

Sharp repricing also in the US real yield space

The sharp repricing is also visible in the US real yield space. While spot real yields from the TIPS market are still slightly negative, implied 1-year real yields now price positive real yield across the curve (Exhibit 8). Real yields in the euro area and the UK, where growth expectations are most likely to be more severely impacted, are still close to the lows. The sharp increase in bond yields has been solely reflected in increased inflation expectations.

Time to start reducing the fixed income underweight

The fixed income market has undergone by far the most drastic repricing  compared  to other financial assets. We therefore conclude that the relative risk/return trade-off for fixed income has improved over the past few months. Inflation rates will continue to print on the high side over coming months and it will take time for the global economy to exhibit more pronounced signs of softness. While bond yields can go up a bit more in the near term, the substantial repricing and the much higher yield levels suggest that it is time to start reducing the fixed income underweight.

 

Environment for credit remains challenging

We remain cautious on credit as rising real yields and a more meaningful expected slow- down for the global economy continues to present a challenging environment credit.

FX

The sharply deteriorating energy trade balance is a challenge for the EUR, while we expect the USD to be resilient and commodity- linked currencies to benefit

Over the past weeks, currencies have been largely driven by (1) the developments around the war in Ukraine along with (2) increasing policy rate expectations. The steep surge in energy prices has affected G10 energy trade balances at large (Exhibit 9), which has important implications for FX: While the US dollar and commodity-linked currencies are well- supported, non-commodity exporters’ currencies are suffering (Exhibit 10). Going forward, we expect the developments on the energy front to continue to pose a challenge in particular for the euro and the Japanese yen as the current account surplus of these economies may turn into a deficit. Against the backdrop of the UK’s lower energy dependence from Russia, the British pound should be affected to a lesser degree.

Likely more JPY weakness ahead, while we expect the CHF to remain strong and gold to consolidatemoderately towards year-end

On the yield front, the widening of the relative government bond yield differential has weakened the Japanese yen considerably. Given  that the  BoJ  remains  remarkably  dovish, we do not expect the downward pressure on the yen to abate soon (see «Near term, dovish Bank of Japan to keep yen weak», Cross-Asset Weekly 8/4/2022). In light of the strong inflationary pressures outside of Switzerland, we think that  the  Swiss  franc  should  con- tinue on its upward trend, while the SNB will likely counter excessive appreciation of its currency (Exhibit 11). Gold should be similarly supported by persistent  inflation  risks  (Exhibit 12), while we stick with our expectation of a moderate consolidation later this year as real yields are set to rise somewhat further towards year-end.

Equities

We reduce our S&P500 end-year target to 4500

In line with the downgrades to our economic outlook and in response to higher rates, we lower our end-year equity targets across the board. Most notably, we reduce our S&P500 end-year forecast to 4500, from 4900, as the lower expected US GDP growth number of 3.2 % in 2022 should be reflected in earnings (Exhibit 13). The sharp increase in real rates since the beginning of the year has already taken a toll on valuations and is expected to weigh until the end of the year. Market upside until the end of the year is negligible as a result and falls in line with the cautious tactical stance which we have held for several months.

Our sector and regional preferences keep their  defensive bias. We reduce China/EM to neutral and move UK equities to least preferred

In terms of regions and sectors, we stick to our defensive bias. This translates into a staples/utilities/health care preference on the sector side and a preference for Swiss equities when it comes to regions. We keep our preference for Japanese equities in Asia, given attractive valuations, currency support and fairly solid earnings. Yet we remove our preference for Chinese and Emerging Markets equities as the China macro outlook is not im- proving and more conciliatory words from regulators have not been followed up by action. We believe that the high degree of uncertainty, which could play out either way, justifies a neutral stance on Chinese and EM equities. Additionally, we move UK equities back to least preferred, after upgrading them to neutral late last  year. Structural challenges for the UK market remain in place and the upside for energy, materials and financials should be more limited going forward (Exhibits 14, 15)In terms of regions and sectors, we stick to our defensive bias. This translates into a staples/utilities/health care preference on the sector side and a preference for Swiss equities when it comes to regions. We keep our preference for Japanese equities in Asia, given attractive valuations, currency support and fairly solid earnings. Yet we remove our preference for Chinese and Emerging Markets equities as the China macro outlook is not im- proving and more conciliatory words from regulators have not been followed up by action. We believe that the high degree of uncertainty, which could play out either way, justifies a neutral stance on Chinese and EM equities. Additionally, we move UK equities back to least preferred, after upgrading them to neutral late last  year. Structural challenges for the UK market remain in place and the upside for energy, materials and financials should be more limited going forward (Exhibits 14, 15)

We keep our cautious stance on cyclicals, banks and energy

This is also reflected in our sector preferences. Apart from our preference for defensive sectors, we are cautious on cyclical  sectors as well  as  energy and financials. Banks  have failed to benefit from higher rates as macro data has deteriorated at the same time. This results in net interest income gains partly being offset by weaker capital markets activity, a key driver of banks earnings in H2 2021 (Exhibits 14, 15).

 

www.jsafrasarasin.com

 

Here starts the third feature:

 

WTO: Russia-Ukraine conflict puts fragile global trade recovery at risk

Prospects for the global economy have darkened since the outbreak of war in Ukraine on 24 February, prompting WTO economists to reassess their projections for world trade over the next two years.

The organisation now expects merchandise trade volume growth of 3.0 % in 2022 — down from its previous forecast of 4.7 % — and 3.4 % in 2023, but these estimates are less certain than usual due to the fluid nature of the conflict (Table 1).

The most immediate economic impact of the crisis has been a sharp rise in commodity prices. Despite their small shares in world trade and output, Russia and Ukraine are key suppliers of essential goods including food, energy, and fertilizers, supplies of which are now threatened by the war. Grain shipments through Black Sea ports have already been halted, with potentially dire consequences for food security in poor countries.

The war is not the only factor weighing on world trade at the moment. Lockdowns in China to prevent the spread of COVID-19 are again disrupting seaborne trade at a time when supply chain pressures appeared to be easing. This could lead to renewed shortages of manufacturing inputs and higher inflation.

“The war in Ukraine has created immense human suffering, but it has also damaged the global economy at a critical juncture. Its impact will be felt around the world, particularly in low-income countries, where food accounts for a large fraction of household spending,” Director-General Ngozi Okonjo-Iweala said. “Smaller supplies and higher prices for food mean that the world’s poor could be forced to do without. This must not be allowed to happen. This is not the time to turn inward. In a crisis, more trade is needed to ensure stable, equitable access to necessities. Restricting trade will threaten the wellbeing of families and businesses and make more fraught the task of building a durable economic recovery from COVID 19,” the Director-General went on to say.

She said governments and multilateral organisations must work together to facilitate trade at a time of sharp inflationary pressures on essential supplies and growing pressures on supply chains.

“History teaches us that dividing the world economy into rival blocs and turning our backs on the poorest countries leads neither to prosperity nor to peace. The WTO can play a pivotal role by providing a forum where countries can discuss their differences without resorting to force, and it deserves to be supported in that mission,” she said.

With little hard data on the economic impact of the conflict, WTO economists have had to rely on simulations to generate reasonable assumptions about GDP growth in 2022 and 2023. Current estimates based on the WTO Global Trade Model capture (1) the direct impact of the war in Ukraine, including destruction of infrastructure and increased trade costs; (2) the impact of sanctions on Russia, including the blocking of Russian banks from the SWIFT settlement system; and (3) reduced aggregate demand in the rest of the world due to falling business/consumer confidence and rising uncertainty.

Under these assumptions, world GDP at market exchange rates is expected to grow by 2.8 % in 2022, down 1.3 percentage points from the previous forecast of 4.1%. Growth should pick up to 3.2 % in 2023, close to the average rate of 3.0 % between 2010 and 2019. Output in the Commonwealth of Independent States (CIS) region — which excludes Ukraine — is expected to see a sharp 7.9 % drop, leading to a 12.0 % contraction in the region’s imports.

Chart 1 shows quarterly world merchandise trade volume estimates through the end of 2023, including error bands indicating confidence intervals associated with the forecast. Given current GDP assumptions, merchandise trade volume growth in 2022 could be as low as 0.5 % or as high as 5.5 %. These projections will be updated in October, but an earlier revision could be issued if incoming data warrant it. The forecast takes into account higher frequency data for selected economies, including monthly statistics on container throughput of U.S. and Chinese ports in order to capture port congestion in these countries.

Quarterly world merchandise trade volume estimates through the end of 2023

 

Source:   WTO and UNCTAD, WTO Secretariat estimates.

Note:       Each shaded region represents a +-0.5 standard error band around the central forecast.

 

Chart 2 illustrates the recent rise in world fuel prices, which pre-dates the conflict in Ukraine. The benchmark Brent crude oil price for March came in at USD 118 per barrel, up 38 % from its level in January and up 81 % year-on-year. (It should be noted that daily prices have moderated recently, from a peak of USD 128 per barrel on  March 8 to USD 104 per barrel on April 1, 2022)

Unlike oil prices, natural gas prices tend to diverge strongly across regions. The price of natural gas in Europe rose 45 % between January and March to USD 41.0 per million Btu, whereas prices remained relatively low in the United States at around USD 4.9 per million Btu. Higher oil prices may reduce real incomes and import demand worldwide, while higher natural gas prices would probably have a greater impact in Europe.

Chart 2: Monthly average prices for crude oil and natural gas, January 2018 – March 2022

 

In the two decades before the global financial crisis, world merchandise trade volume grew around twice as fast as world GDP at market exchange rates, but the ratio between trade growth and GDP growth fell to around 1:1 on average after the crisis. If the current forecast is realised, this ratio would be 1.1:1 in both 2022 and 2023, suggesting no fundamental change in the relationship between trade and output. Risks to the forecast are mixed and difficult to assess objectively. There is some upside potential if the war in Ukraine ends sooner than expected, but substantial downside risks could emerge if fighting persists for a long time or if the conflict escalates.

Chart 3 shows quarterly merchandise trade volume indices by region from the first quarter of 2019 to the final quarter of 2023, at the end of the forecast period. Regional disparities in the forecasts persist, but Europe is now expected to underperform on the import side along with Africa and the CIS. The latter is mostly due to sanctions against Russia. Meanwhile, Middle East import volumes are expected to pick up as higher oil prices boost export revenues, allowing countries in the region to import more. Weakness in Europe is partly due to the fact that Ukraine is included in this country group, dragging down the regional average. The low level of imports in Africa is partly due to unexpected declines in the second half of 2021, which are projected forward into the future.

Export volumes show slow growth in most regions, including the CIS, since Russia is still able to export fuels. If the situation were to change, we might see stronger export volume growth in other fuel producing regions.

Chart 3: Merchandise exports and imports by region, 2019Q1-2023Q4 Volume index, 2019=100 Chart 3: Merchandise exports and imports by region, 2019Q1-2023Q4 Volume index, 2019=100

 

Table 1 summarises annual merchandise trade volume growth since 2018 and projections for 2022 and 2023. Annual volume indices sometimes differ slightly from the quarterly indices due to differences in methodology, but they generally tell the same story. In addition to the standard WTO regions, the table also includes experimental forecasts for Least-Developed Countries (LDCs).

The year 2021 saw a sharp rebound in trade volumes after the pandemic-induced slump of 2020, but growth might have been stronger without recurring waves of COVID-19 during the year. Every region had export growth below the world average of 9.8 % except for Asia, which saw its exports increase by 13.8 %. The situation was reversed on the import side, where North America, South America, the CIS and Asia all recorded above average growth.

The forecast foresees 2022 export volume growth of 3.4 % in North America, -0.3 % in South America, 2.9 % in Europe, 4.9 % in the CIS, 1.4 % in Africa, 11.0 % in the Middle East, and 2.0 % for Asia. It also anticipates import growth of 3.9 % in North America, 4.8 % in South America, 3.7 % in Europe, -12.0 % in the CIS, 2.5 % in Africa, 11.7 % in the Middle East and 2.0 % in Asia. LDCs should see their export and import volumes increase by 3.5 % and 6.6 % respectively in 2022. Except for the Middle East, all regions saw forecasts for 2023 revised downward. Trade costs should rise in the short run as a result of sanctions, export restrictions, energy costs and disruptions in transport due to COVID-19.

Trade developments in value terms

The WTO’s trade forecast is released in conjunction with annual merchandise and commercial services trade statistics in current U.S. dollar terms. These figures can be downloaded from the WTO’s online database at stats.wto.org. Merchandise trade growth in nominal terms diverged strongly from growth in (real) volume terms in 2021 due to strong price fluctuations over the course of the year. World merchandise trade as measured by the average of exports and imports rose 26 % in 2021, which implies that export and import prices jumped 15 % for the year on average. The dollar value of trade in fuels and mining products was up 59 %, agricultural products were up 19 %, and manufactures were up 21 %.

Chart 4 shows estimated year-on-year and 24-month growth rates for selected categories of manufactured goods in 2021. Quarterly developments show steady year-on-year growth in certain products (iron and steel, chemicals, integrated circuits) and weaker growth for others (clothing, machinery). Trade values for pharmaceuticals, computers and integrated circuits were actually higher in 2021 than before the pandemic, probably due to high demand for COVID-19 vaccines and increased prevalence of remote working. In contrast, trade in automotive products was up 14% year-on-year in 2021 but down 4 % compared to 2019.

World trade in commercial services was up 15 % year-on-year in 2021, boosted by demand for transport services, which grew 33 % (Chart 5). Growth of travel exports was positive but it remained weak, as travel restrictions were only partially eased during the year. The category Other services, which includes financial and business services, was up 12 % compared to the previous year.

Western sanctions on Russian businesses and individuals are likely to have a strong effect on commercial services trade. Russia is a net services importer, with imports in 2021 valued at USD 74 billion and exports totalling USD 55 billion. Russia is ranked 24th among services exporters (13th excluding intra-EU trade), with a share in world trade of 0.9 %. It is ranked 19th among importers (11th excluding intra-EU) with a 1.4 % share in world trade.

In 2019, the European Union accounted for more than 42 % of Russia’s services imports and 31.1 % of its services exports. In the same year Russia also sourced services from Turkey (7.7%), the United Kingdom (5.1 %), the United States (4.0 %), China (3.7 %), and Switzerland (3.3 %), among others. The United States (6.5 %), China (6.2 %), Switzerland (6.1 %), and the United Kingdom (4.8 %) were main non-EU destinations for Russian services exports.

Prior to the pandemic, travel/tourism and air transport services were the largest traded services by Russia, accounting for 46 % of its exports and 36 % of its imports. These services, already hit hard by the pandemic, may be heavily affected by economic sanctions. Ireland is exposed due to the prominent role of the country in operational leasing of aircraft. Overall, Russian payments for operational leasing of aircraft, boats, etc. from the EU reached USD 3.9 billion in 2019, of which USD 2.6 billion were for leasing services from Ireland. In 2020, Russian operational leasing imports fell 44 % due to pandemic-related travel restrictions.

Intellectual property services were the third biggest category of services imported by Russia. The European Union, Switzerland, the United States, the United Kingdom, the Republic of Korea, and Japan together provided 96 % of Russia’s imports in 2019, worth some USD 6.6 billion. This includes fees for the use of patents, outputs from research and development, industrial processes/designs, franchises and trademarks, among others.

Detailed quarterly and annual statistics on merchandise and commercial services trade can be downloaded from stats.wto.org. A statistical supplement showing country ranks and shares in world trade can be downloaded here.

Supplemental Indicators

The WTO tracks a number of timely, high-frequency trade-related indicators to better understand trends in merchandise and commercial services trade. A selection of these is presented below to provide additional context to the trade statistics and forecast.

The latest RWI/ISL container throughput index showed seasonally-adjusted throughput declining 3.6 points to 117.1 in February (Chart 6). The index incorporates container data on container handling at 94 international ports, accounting for 64 % of the global total. Chinese ports saw the biggest decline in March, but European ports also registered a substantial decline. The data could be influenced by seasonal adjustments, but it could also reflect the early stages of the conflict in Ukraine. The fact that the shipping rates have been steady or declining at the same time suggest that the dip in throughput represents falling demand for shipping services rather than reduced supply.

Purchasing managers’ indices (PMIs) from IHS-Markit are based on surveys of hundreds of businesses in more than 40 countries. These are aggregated into a global index and several sub-indices, with values greater than 50 indicating expansion and values less than 50 denoting contraction (Chart 7). The Headline Global PMI (53.0) remained above the threshold value of 50 in March, suggesting that manufacturing output may still be expanding but at a reduced pace. Meanwhile, New Export Orders fell to 48.2, its lowest level since July 2020, signalling slower growth or possibly contraction in world trade. Supply chains have been hampered in recent months by long delivery times and shortages of production inputs such as semiconductors. The indices shown in the right panel of Chart 7 suggest that these issues are not yet resolved. A rise in input and output prices and an uptick in delivery times in March 2022 suggest continued supply-demand imbalances that could contribute to inflation in the coming months.

Finally, Chart 8 below shows the daily volume and average tone of news reports containing phrases related to economic activity, as monitored by the GDELT Project Summary Service. Although the intensity of reporting on these issues remained flat in recent weeks, the tone took a negative turn in late February. The fact that that this downturn coincided with the start of hostilities in Ukraine suggest that the conflict may be damaging economic sentiment.

The World Trade Organisation (WTO) deals with the global rules of trade between nations. Its main function is to ensure that trade flows as smoothly, predictably and freely as possible.

www.wto.org

 

Newsletter of last Week

How the fashion industry can get into a metaverse mindset – Forget Logos, Fashion Houses Are Clamouring for Colours – Why Stomach Tightening Is a New Skin-Care Trend – Risk transformations: The heart, the art, and the science https://textile-future.com/archives/87834

 

The highlights of last week’s NEWS, for your convenience, just click on the feature to read.

Associations

AATCC Seeks Members for New Technology Committee https://textile-future.com/archives/88142

Automotives

RENAULT REVEALS ITS CAR VISION OF SUSTAINABLE DEVELOPMENT AT CHANGENOW 2022 https://textile-future.com/archives/88057

China

Yellen Challenges China in ‘Moment for Choosing’ on World OrderYellen Challenges China in ‘Moment for Choosing’ on World Order https://textile-future.com/archives/88121

Companies

Teijin Frontier Develops CO2 Emissions Calculator for Polyester Fibre https://textile-future.com/archives/87907

Swiss Bossard Group: Sales for the first Quarter of 2022 Ad hoc announcement pursuant to Art. 53 LR https://textile-future.com/archives/87943

BASF Group releases preliminary figures for first quarter of 2022 https://textile-future.com/archives/87955

CALIDA Holding AG 2022 Annual General Meeting – all proposals approved https://textile-future.com/archives/88095

Data

Data-based yield improvement https://textile-future.com/archives/87895

Give us your feedback on Eurostat ‘Key figures’ https://textile-future.com/archives/87913

Online sales efforts on the rise due to the pandemic https://textile-future.com/archives/87949

How do we travel in a world changed by COVID-19? https://textile-future.com/archives/87959

Swiss Producer and Import Price Index rose by 0.8 % in March https://textile-future.com/archives/88046

Italy: Online content consumption up 44 % in 3 years https://textile-future.com/archives/88127

Divesture

Clariant completes divestment of 50 % stake in Scientific Design joint venture https://textile-future.com/archives/88116

EU

Global Gateway: EU President von der Leyen announces major event on June 21-22, 2022  https://textile-future.com/archives/87910

Events

Bangladesh Denim Expo re-opens its doors : https://textile-future.com/archives/87904

Showcasing nonwovens at Cinte Techtextil China 2022 https://textile-future.com/archives/88061

Innovations in yarn technologies at ITM 2022 https://textile-future.com/archives/88068

Trützschler: First Nonwovens Symposium in Uzbekistan has been a great success https://textile-future.com/archives/88135

Strong home textiles exports create opportunities for Intertextile Shanghai Home Textiles suppliers https://textile-future.com/archives/88175

Intellectual Property Education

WIPO – Now Available: Madrid System Q2 Webinars Programme https://textile-future.com/archives/87990

Finland

FIVE FROM FINLAND: Responsible design https://textile-future.com/archives/88076

OECD

OECD Declaration on a Resilient and Healthy Environment for All and other news  https://textile-future.com/archives/88025

Partnering

Adidas and Allbirds launches low-carbon running sneakers in 4 cool colourways https://textile-future.com/archives/88030

Personalities

Elon Musk Reverses Decision to Join Twitter’s Board, CEO Says https://textile-future.com/archives/87924

Research

Swiss Empa – Portrait Rolf Erni: An eye for the smallest things https://textile-future.com/archives/87964

Swiss Empa: Chemical synthesis Golden wedding for molecules https://textile-future.com/archives/88040

Retailing

In pictures: Oxford Street in London (GB) before and after the pandemic In pictures: Oxford Street before and after the pandemic https://textile-future.com/archives/88146

Rubber

Teijin Frontier Develops Eco-friendly Polyester Staple Nanofibre that Reinforces Rubber https://textile-future.com/archives/87917

Switzerland

Switzerland–Brazil: Swiss State Secretary Livia Leu meets Secretary General Fernando Simas Magalhães : https://textile-future.com/archives/87930

Ukraine: Switzerland’s Adoption of further EU sanctions against Russia and Belarus  https://textile-future.com/archives/88018

Federal Council wants Switzerland to join six European research infrastructures https://textile-future.com/archives/88022

Switzerland and Côte d’Ivoire establish new Science, Technology and Innovation fun https://textile-future.com/archives/88090

USA

U.S. Inflation Accelerated to 8.5% in March, Hitting Four-Decade High https://textile-future.com/archives/87979

Webinars

IDTechEx free Webinar on Carbon Nanotubes: Entering the Next Stage in Their Commercial Journey https://textile-future.com/archives/87901

Worldbank

Addressing Challenges to Growth, Security and Stability – Scene-Setter Speech by World Bank Group President David Malpass https://textile-future.com/archives/87974