Oil, tourism, seafood — all hit in Louisiana virus fight

Wearing facemasks, employees chat with people outside a cafe during the coronavirus (COVID-19) pandemic in New Orleans, Louisiana. (AFP)
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Updated 18 May 2020

Oil, tourism, seafood — all hit in Louisiana virus fight

  • US labor department informed about hundreds of oil- and gas-related layoffs

NEW ORLEANS: Every Labor Day weekend, St. Mary Parish celebrates two industries at a tourist event with a seemingly improbable title: The Louisiana Shrimp and Petroleum Festival.

With a shrimp in a hard hat clinging to an oil derrick as its logo, the festival may the best example of how diverse economic interests mesh in south Louisiana — and how attempts to curb the spread of COVID-19 have visited a kind of triple economic whammy on the state.

A worldwide oil glut was pushing down prices even before the pandemic fight lowered energy demand, contributing to layoffs. Festival-driven tourism has dried up, meaning more lost jobs. And one major tourist draw — cuisine built around fin fish, shrimp, oyster and crabs — also is suffering.

“May is normally our busiest month, and it’s terrible,” said Harlon Pearce, owner of a seafood processing business in suburban New Orleans, where restaurants are limited to take-out service and major spring and summer festivals have been canceled. “You have Jazz Fest, you have French Quarter Fest, Mother’s Day. It’s a tough time. Us not having any of our major events this year for tourism is going to be a killer.”

The board that runs the Shrimp and Petroleum Festival in Morgan City, roughly 80 miles west of New Orleans, hasn’t made a final decision on whether to hold a 2020 festival. Even if the show goes on, local seafood dealer Daniel Edgar said, “There’s not going to be a whole lot to celebrate.”

South of New Orleans, in the barrier island community of Grand Isle, marina and hotel owner Buggie Vegas said he recently reopened his hotel after being closed for weeks as access to the island was restricted and a curfew was imposed. He estimates about half of his 26 rooms were booked on a recent weekend, instead of the normal full house in good weather.

Visitors spent $15 billion in Louisiana in 2018 according to the state Department of Culture, Recreation and Tourism, and the hospitality and leisure economy accounted for more than 240,000 jobs as of February. In March, however, hospitality and leisure jobs dropped by 8,400, according to the Louisiana Workforce Commission, the state’s labor department.

Recreational fishing is picking up on the coast, but Vegas has noticed a drop in charter fishing that he attributes, at least in part, to oil-related layoffs.

“The oil companies laid off a bunch of people for the oil price. And that’s a lot of their entertainment,” Vegas said.




Owner Marcy Hesseling wears a mask at a salon in New Orleans. (AFP)

Shrimper Acy Cooper said coastal communities rely on the oil workers and the shrimpers. “If we don’t make any money, they don’t,” he said.

The state seafood promotion board estimates the industry’s economic impact at $2.4 billion. Now, shrimp boats remain docked at Morgan City on the Atchafalaya River in St. Mary Parish, seafood dealer Edgar said. His family-run business is still operating, finding markets for crawfish and crabs, but many wholesalers he deals with have shut down and business is unpredictable, he said.

Cooper, president of the Louisiana Shrimpers Association, estimates only about 5 percent of shrimp boats are going out.

“Just about everything’s shut down right now, with the price of oil,” said Mark Cognovech, a member of the governing council in Plaquemines Parish, at the state’s southeastern tip.

The Louisiana Workforce Commission reports that direct employment in oil and gas is about 34,000. The estimated payroll is more than $3 billion, according to the Louisiana Oil and Gas Association. But large employers have informed the state labor department of hundreds of oil- and gas-related layoffs because of COVID-19 uncertainty. The association’s director, Gifford Briggs, said the number of lost jobs tied directly to oil and gas employment could surpass 23,000 in the coming months, based on a survey of members.

Louisiana was an early Southern hot spot in the nation’s coronavirus outbreak. Gov. John Bel Edwards recently began easing restrictions on dine-in restaurants and public gatherings.

Looking ahead, Edgar doesn’t foresee a quick turnaround, even as restrictions are eased. Restaurants still can’t fill to capacity under social distancing guidelines. And some would-be patrons, mindful of the disease, won’t show up, Edgar said.

“A lot of people aren’t going to want to get in big crowds,” Edgar said. “Even if you open the restaurants tomorrow.”

And the pain could linger. In New Orleans, Mayor LaToya Cantrell has acknowledged that public celebrations leading up to Mardi Gras — Feb. 16 next year — may have to be canceled.

As for the Shrimp and Petroleum Festival?

“We go back and forth, back and forth,” said the festival’s board chairman, pawn shop owner Charlie Solar Jr. He described the current status as “on hold” but acknowledged that it’s an uncertain term.

“’Hold’ is the word we’re using now,” he said. “Who knows?”


Trump advisers urge delisting of US-listed Chinese companies that fail to meet audit standards

Updated 26 min 38 sec ago

Trump advisers urge delisting of US-listed Chinese companies that fail to meet audit standards

  • Growing pressure to crack down on Chinese companies that avail themselves of US capital markets but do not comply with rules
WASHINGTON: Trump administration officials have urged the president to delist Chinese companies that trade on US exchanges and fail to meet US auditing requirements by January 2022, Securities and Exchange Commission and Treasury officials said on Thursday.
The remarks came after President Donald Trump tasked a group of key advisers, including Treasury Secretary Steve Mnuchin and SEC Chairman Jay Clayton, with drafting a report with recommendations to protect US investors from Chinese companies whose audit documents have long been kept from US regulators.
It also comes amid growing pressure from Congress to crack down on Chinese companies that avail themselves of US capital markets but do not comply with US rules faced by American rivals.
“We are simply leveling the playing field, holding Chinese firms listed in the US to the same standards as everyone else,” a Treasury official told reporters in a briefing call about the report.
The US Senate unanimously passed legislation in May that could prevent some Chinese companies from listing their shares on US exchanges unless they follow standards for US audits and regulations.
Democratic Senator Chris Van Hollen, who sponsored the bill described the recommendations as “an important first step,” but said that “without the added teeth of our bill, this report alone does not implement the requirements necessary to protect everyday American investors.”
The administration’s recommendations, if implemented via an SEC rulemaking process, would give Chinese companies already listed in the United States until Jan. 1, 2022, to ensure the US auditing watchdog, known as the PCAOB, has access to their audit documents.
They can also provide a “co-audit,” for example, performed by a US parent company of the China-based affiliate tasked with auditing the Chinese firm. However, companies seeking to list in the United States for the first time will need to comply immediately, the officials said.
A State Department official told Reuters the administration plans soon to scrap a 2013 agreement between US and Chinese auditing authorities to set up a process for the PCAOB to seek documents in enforcement cases against Chinese auditors.
China said on Friday that the two countries have “good cooperation” in monitoring publicly listed firms.
“The current situation is that some US monitoring authorities are failing to comply with their obligations, and what they are doing is political manipulation — they are trying to force Chinese companies to delist from US markets,” foreign ministry spokesman Wang Wenbin told a media briefing.
The PCAOB has long complained of China’s failure to grant requests, giving it scant insight on audits of Chinese firms that trade on US exchanges.
The report also recommends requiring greater disclosure by issuers and registered funds of the risk of investing in China, as well as mandating more due diligence by funds that track indexes and issuing guidance to investment advisers about fiduciary obligations surrounding investments in China.
The moves come amid rising tensions between Washington and Beijing over China’s handling of the coronavirus and its moves to curb freedoms in Hong Kong, among other issues.