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Hong Kong plans to introduce its version of U.S.-style “chapter 11” bankruptcy provisions, a senior government official said, as the city’s worst economic predicament in decades threatens the viability of many companies, Reuters reported. Hong Kong does not have a formal corporate rescue framework, unlike most other major financial centers including fierce rival Singapore, after previous attempts to introduce one met with resistance from lawmakers and labor representatives who were worried plans did not offer enough protection for workers. Such a system would give struggling companies a window to restructure their debt while being protected from the threat of legal action by their creditors. James Lau, Hong Kong’s Secretary for Financial Services and the Treasury, intends to propose a bill setting out the new arrangements early in 2021. Hong Kong’s businesses are reeling from the combined effects of the U.S.-China trade war, several months of anti-government protests and now the economic impact of the fast-spreading coronavirus.

Before the coronavirus epidemic, U.S. companies were heading for record-low profitability in China as business conditions deteriorated and China’s economy slowed to its lowest rate in decades, according to a new survey of U.S. companies with operations in China, the Wall Street Journal reported. That position will be further challenged as these companies seek to absorb what could be a historic hit in China, the world’s second-largest economy and the epicenter of the novel coronavirus now ravaging the global economy. The annual snapshot of business conditions, captured by the Beijing-based American Chamber of Commerce in China in a survey conducted in October and November last year, underscores how fragile conditions were for American companies before the Covid-19 epidemic began to come into public view in mid-January. Before the outbreak, U.S. companies in China were already concerned about their business prospects in the country, largely because of U.S.-imposed tariffs that had weighed on demand and increased manufacturing costs. The rising cost of labor in China also led some firms to move their supply chains out of China, while others said the softening economy in China had made it difficult to grow.

Britain’s Flybe collapsed yesterday after a plunge in travel demand, making the long-struggling regional airline one of the first big corporate casualties of the coronavirus outbreak, Reuters reported. The failure of an airline that connects all corners of the United Kingdom with major European destinations not only puts around 2,400 jobs at risk but could also see some airports struggle and regional economies hit. “All flights have been grounded and the UK business has ceased trading with immediate effect,” Flybe said after the government walked away from a rescue package agreed in January. Airlines around the world have been cancelling flights and warning of a hit to profitability after coronavirus first emerged in China, hitting flights across Asia, before it spread to Europe and beyond. Flybe’s collapse will also cause more problems for Prime Minister Boris Johnson who had promised to “level up” Britain by investing in regional transport links. His government had agreed a rescue deal for the 41-year-old airline in January, saying it was important to maintain connections across the country for its eight million passengers. It said yesterday that there was nothing more it could do.

The largest U.S. gateway for seaborne imports from China is projecting a 25 percent drop in container volumes this month as the economic impact of the coronavirus spreads across shipping operations far from the outbreak, the Wall Street Journal reported. Container ship operators have canceled 40 sailings at the Port of Los Angeles between Feb. 11 and April 1, mostly for vessels coming from China, port Executive Director Gene Seroka said. That amounts to a little more than one-quarter of the overall number of ships that would typically call at the port during that time, he said.Los Angeles handled the equivalent of more than 705,000 containers last February, so the projected decline would mean about 176,000 fewer containers moving through the port this month. About 9.3 million boxes passed through the port in 2019. Shipping volumes out of China have plunged as the shutdowns in the wake of the outbreak crimp industrial production, with ocean carriers warning that canceled trips will take a toll on earnings. A.P. Moeller-Maersk A/S, the world’s biggest containership operator, has canceled more than 50 sailings from China to the rest of the world since late January.

Argentina’s economy minister confirmed bondholders’ worst fears, telling them to brace for significant losses as the country restructures its debt amid an economic crisis, Bloomberg News reported. Martin Guzman warned on Wednesday that holders of Argentine debt will probably be disappointed by the restructuring, without providing specifics on how steep losses could be. “It’s necessary to have a deep debt restructuring,” he said at a congressional hearing where he provided his most detailed comments about debt strategy since taking office in December. “It’s clear that there’s going to be frustration on the part of bondholders.” Investors have been fearing an aggressive debt restructuring since August, when President Alberto Fernandez defeated pro-market leader Mauricio Macri in primary elections by a far wider margin than any poll had forecast. The peso and sovereign bonds prices have since plunged. Still the statement will come as a blow to those holding out hope that Fernandez would opt for a more moderate stance.

Air Italy’s investors agreed yesterday to place the struggling Italian carrier into liquidation, the airline said citing “persistent and structural market problems,” Reuters reported. The decision was taken “unanimously,” the carrier said, but in a separate statement Qatar Airways, which holds a 49 percent stake, said that it would have been ready to support the relaunch and growth of the airline. Formerly known as Meridiana, Air Italy is the country’s second-largest airline, behind Alitalia. Regional carrier Alisarda, controlled by the Aga Khan, owns the remaining 51 percent. Under current rules, foreign investors cannot own more than 49 percent of a European airline.