Government and Policy Updates from the New Statesman
In the UK
The government will write off £13.4bn of historic debt owed by hospital trusts to the NHS, Matt Hancock announced in a press conference last night. The health secretary, in his first public appearance since self-isolating with symptoms of Covid-19, also pledged £300m of government money to be made available for community pharmacies.The NHS has confirmed new temporary Nightingale hospitals in Bristol and Harrogate, which will add 1,500 beds. A 4,000-bed facility in London’s ExCel centre is due to open later today.
Hancock also outlined new measures which he claimed will deliver 100,000 tests a day in England before the end of April. These would include antigen tests that show whether people are currently infected, and antibody tests – which have not been clinically proven – to see if people have had Covid-19 and recovered.
Meanwhile, almost a million people have successfully claimed Universal Credit in the last two weeks – and the total number of applicants is likely to be much higher.
Around the world
United States: More than 6.65 million people in the US filed for unemployment benefits in the past week. Around 3.3 million people had filed for unemployment the previous week. The US remains
Germany: Despite evidence that widespread testing is behind the country’s low death rate, Germany has been told by its public health advisory body, the Robert Koch Institute, that its efforts must improve further. Germany’s 500,000 tests a week should increase that to more than a million, or 200,000 tests a day, the institute said.
China: A national day of mourning will take place tomorrow for the “martyrs” who died in the fight against coronavirus. The country will observe three minutes of silence at 10am on 4th April while air raid sirens and horns of cars, trains, and ships, “wail in grief”, the state news agency, Xinhua has reported.
Japan: Prime Minister Shinzo Abe is under pressure to declare a state of emergency after the country reported 235 new cases of coronavirus, bringing its total to 3,329. The capital, Tokyo, saw its largest single-day rise so far of 97 cases yesterday.
New Zealand: The minister of health, David Clark, has apologised after ignoring his government’s advice to exercise locally. Clark drove 2.3km from his home to go mountain biking yesterday. A member of the public recognised Clark’s van, which is decorated with a large picture of the minister’s face..
Read more on the New Statesman:
Evening Update: China travel suspension hits Thailand for $3bn and is the world really ‘flattening the curve’?
News in brief – 2nd March
Salary sacrifice: IndiGo CEO Ronojoy Dutta announced on Thursday that the airline was instituting pay cuts for senior employees and he would himself take the highest cut of 25 percent.
Germany vs. Australia: German cruise ship MV Artania has refused to leave Western Australian waters after the confirmation of Covid-19 cases onboard. The Australian Border Force (ABF) had ordered the cruise ship to leave Fremantle after many of the passengers were repatriated and sent home on 29th March. However, approximately 450 people, mostly crew members, are still on board. 12 of them are reported to be too unwell to fly. Western Australia Premier Mark McGowan has requested the Australian Government to intervene and send the ship off Australian waters, saying: “If the ship needs to be cleaned, clean it and then get it on its way.”
Low-cost cuts in Mexico: ultra-low-cost carrier Volaris has reduced capacity as Mexico declared a state of emergency, effective until the end of this month. The carrier has reduced its capacity of available seat miles by 80%.
Knock-on effect of lack of tourism is far reaching in Thailand
Thailand as a tourism destination has been severely struck. The tourism-reliant destination took a hit from the onset due to the Chinese Government suspending air transportation on January 23. Chinese tourists are the main source market for Thailand, accounting for 43% of arrivals in 2019, according to GlobalData.
Chinese tourists are the main source market for Thailand, accounting for 43% of arrivals in 2019. Credit: GlobalData.
From the suspension of airlines, to the closures of hotels and attractions, to now the economic impact of Covid-19 affecting animals and sanctuaries in Thailand. It has become obvious that the tourism machine in Thailand relies on all the cogs to be in working order for it to be a success.
The Tourism Authority of Thailand (TAT) predicted a revenue loss of $3.05bn from fewer Chinese tourists from January to April. It is probable that this number could rise higher as tighter travel restrictions are implemented, meaning travellers from other countries are now staying put. The decline has been swift and sharp.
The graph shows historic and forecast international arrivals in Thailand between 2015 and 2023. The forecast figures are subject to change as the implications associated with Covid-19 are causing international arrivals to rapidly decrease.
Due to drastic decreases in tourism numbers, caretakers are struggling to feed many elephants in sanctuaries within Thailand. The reduction in tourism numbers creates a huge economic loss for many industries in the Thai tourism sector. The fact that the wildlife, a major attraction in Thailand, cannot be fed illustrates the ripple effect that Covid-19 is creating.
The government and TAT must work with sanctuaries to ensure helpless animals are fed. This can be done by providing bailouts so sanctuaries can operate. Elephant sanctuaries are considered a key tourist attraction in Thailand and attract thousands of tourists every year. It is in the Thai Government’s interest to assist these sanctuaries. The government and tourism authorities must liaise in order to proactively manage this situation.
There are other ways in which the elephant sanctuaries can be saved. Promotions can be set up to encourage worldwide donations and persuade other charities to assist. The Elephant Asia Rescue and Survival (EARS) foundation has set up a foundation to help provide provisions and care for elephants at risk. This charity should be heavily promoted. Thailand’s destination marketing organisation (TAT) can also promote this to reach overseas markets.
Why wasn’t the UK ready for Covid-19?
A long-read from the New Statesman.
In the UK, a lethal pandemic was considered by the government a “level 5” threat – the most serious security risk. The only other level 5 threat has been large-scale biological or nuclear attack.
The coronavirus closely resembles the threat anticipated in government planning documents, and yet the government appears to have been unprepared. The UK lacks ventilators, personal protective equipment and testing kits, while emergency procedures for manufacturers and hospitals are being improvised on the fly.
In the New Statesman, Harry Lambert suggests that Britain may in fact have been prepared, just for the wrong outcome.
Covid-19 daily death totals: “are we flattening the curve”?
While every nation is giving regular updates on deaths linked to the virus, it can be difficult to interpret this data. Daily death totals are volatile and can fluctuate rapidly from day to day; countries can change the time they report, or their methodology, leading to sudden and abrupt change.
In these charts we smooth out the data by using a rolling three-day average of deaths. Each day is plotted against the average number of new deaths reported over the previous three days. The percentage increases (or decreases) are plotted separately. The chart covers the countries where the highest number of deaths overall, excluding China – where daily confirm deaths have slowed to a trickle – and Iran, where the data may not be reliable. The charts start at the point each country passed 50 Covid-19 deaths in total.
Notes from our epidemiologist
Coronavirus Disease 2019 (COVID-19) has now spread across 180 countries with approximately 860,000 total confirmed cases worldwide. The US is the most-heavily affected country in the world with 190,000 confirmed cases followed by Italy and Spain.
The epicenter of this pandemic has started to shift from Europe to the US. However, most of the deaths are still reported in Europe with Italy (12,500) and Spain (8,500) representing approximately 50% of total deaths from COVID-19 worldwide.
As Europe has seen a surge in cases, majority of the countries in Europe are now in lock-down, prohibiting all non-essential travel.
Cases are also starting to rise in South East Asia, Africa and Latin America with serious concern whether their health systems are prepared for this pandemic.
Bishal Bhandari, PhD, senior epidemiologist, GlobalData
UK Government announces closure of non-essential businesses
Last night, UK Prime Minister Boris Johnson announced more stringent, semi-lockdown measures for the UK to encourage social distancing.
These included only allowing people out of their homes to shop for basic necessities, exercise once a day, any medical appointments and to go to work if absolutely necessary.
To the end of discouraging people from leaving their houses for any other reasons, the UK Government closed all non-essential shops, including clothing and electronics retail stores, hair and beauty salons, and markets, except those selling food.
The police and other relevant authorities will be given powers to enforce these social distancing rules, including issuing out fines.
Global GDP may drop by 1% in 2020, says Goldman Sachs
Goldman Sachs expects global real gross domestic product to contract by about 1 per cent in 2020, a sharper economic decline than in the year following the 2008 global financial crisis.
“The coronacrisis or more precisely, the response to that crisis — represents a physical (as opposed to financial) constraint on economic activity that is unprecedented in postwar history,” the investment bank said in a note to its clients published late on Sunday according to India Today.
OECD expects economic fallout to be felt ‘for a long time to come’
Speaking to CNBC, the OECD’s secretary general, Angel Gurria, stated: “What you have is an economic effect now that, very clearly, is going to be prolonged beyond the period of the pandemic.”
“We’ll hopefully get rid of the pandemic in the next two or three months and then the question is how many unemployed (will there be), how many small and medium-sized enterprises will be in a very, very severe situation if not disappeared by that time.”
“Life, and economic activity, is not going to be normalized any time soon,” he said. “We’re going to have the impact of this crisis for a long time to come.”
Spanish lodging industry to take significant hit with all accommodation closing
Spain is heavily reliant on tourism, thus making the lodging industry a vital contributor to the national economy.
According to WTTC, Travel & Tourism is the largest sector in Spain in terms of its contribution to GDP and employment, contributing 15% to GDP and €176bn to the nation’s economy in 2018.
Spain has been fourth-hardest hit, globally, by Covid-19, with 767 deaths and 17,147 infections.
These statistics illustrate that it was the right decision by the national government to close hotels and accommodation from a social standpoint. However, this decision will create a devastating impact on the tourism industry and the wider economy in Spain.
The closing of hotels will create a long term negative multiplier effect. Jobs will be lost, and small hotels may even close permanently if the Spanish Government does not help in terms of providing bailouts or loan schemes.
Travel and tourism is the biggest employer in Spain accounting for 2.9 million jobs with many being within the lodging industry. This emphasises the importance of tourism and the impact these closures will have on not only the lodging companies but also employees and the local communities where the lodging companies operate in.
What does the future look like for the Spanish tourism industry?
It is unsure how long Covid-19 will go on for, but it is clear the Spanish Government must contribute to help a declining but highly important industry.
The UK Foreign Office has now told all British tourists in Spain to return home since the hotel closure announcement.
According to GlobalData, UK tourists were by far the most dominant source market for Spain with 15.8 million arrivals in 2019. This point stresses the fact that the hit to Spain’s economy from Covid-19 will have already started.
If the impact on tourism demand lasts the length of the summer, many hotels will simply not be able to survive. Lodging companies in particular parts of Spain already have issues relating to seasonality and rely on a busy summer to sustain themselves through the winter period.
The lodging industry in Spain holds the potential to recover swiftly once Covid-19 is controlled. This is due to the nations varied tourism product, which has always attracted a wide range of visitor types.
European countries especially will create a pent up demand for holidays in Spain. It may even be wise for Spanish tourism authorities to begin planning in this down period for ways in which the nation can maximize tourism flows when Covid-19 is controlled, in order to make up for this period of economic decline.
Covid-19: Hotels in Lebanon cut 17,000 jobs amid coronavirus outbreak
Hotels in Lebanon have reportedly cut 17,000 jobs amid an economic slowdown and due to coronavirus (Covid-19) outbreak.
Local media quoted Syndicate of Hotel Owners president Pierre Ashkar as saying that the current occupancy rate in Lebanon’s hotels stands at 5%.
In order to minimise expenses, many hotels are believed to have closed down.
Ashkar told online independent newspaper Elnashra: “Around 90% of hotels in Lebanon have stopped 95% of their operations and services and the remaining employees are paid half of their salaries or even less.”
Due to the wide spread of the Covid-19 outbreak, the government urged most businesses in Lebanon to close down to further contain the spread of the virus.
As reported by Asia Times, the Wuhan virus has infected at least 99 people and killed another three in the country.
At present, two Asian countries and six European countries are among the ten most affected list of countries with coronavirus.
COVID-19 has reached about 140 countries including China, but tested negative in at least 11 countries, as of 17 March.
Last December, Ashkar was quoted by Xinhua as saying that the crisis at that time risked around 150,000 jobs in the hospitality sector. Hotels in the country could not cover their expenses and also delayed their employees’ salaries.
Park Hotels & Resorts withdraws 2020 outlook amid coronavirus outbreak
US-based real estate investment trust Park Hotels & Resorts has withdrawn its earlier announced 2020 outlook due to increased uncertainty about the Covid-19 coronavirus outbreak.
The company has encountered a rise in the number of corporate group cancellations, since providing its full-year 2020 guidance.
Park has reported $30m in lost rooms revenue from group customer cancellations, which is primarily expected to take place in March and April.
Park chairman and CEO Thomas Baltimore Jr said: “Since our earnings call on February 27, 2020, the situation related to COVID-19 has evolved rapidly, creating a notable economic impact to our business.
“In addition to the anticipated impact to inbound international travel, during the past week we have seen an increase in group and business transient cancellations as corporate customers pause and assess the highly fluid and uncertain environment.
“Consequently, we expect to see a material impact in the first half of this year.
“However, given the short-term nature of the cancellations and the uncertainty of how long the COVID-19 outbreak will last, we cannot provide a view on our 2020 outlook at this time.”
Park expects to recover certain lost revenue in the form of cancellation fees as well as rebooked events.
The company is primarily focused on implementing cost containment strategies.
Coronavirus Covid-19: Spanish hotel locked down after positive case
A hotel on the Spanish resort island of Tenerife has been locked down as a male Italian guest tested positive for coronavirus in an initial test.
Guests at the H10 Costa Adeje Palace hotel have been asked to stay in their rooms as medical tests were undertaken.
The man who tested positive was reportedly a visiting Italian doctor from the virus-hit Lombardy region. As per the sources, his wife has also been tested positive.
A communications representative for the H10 hotel group said: “Following the report of a possible coronavirus case detected in a customer from Italy, staying at the H10 Costa Adeje Palace, H10 Hotels has implemented all health and operational recommendations from the health authorities to ensure the safety and wellbeing of customers and employees.
“Additionally, we are providing customers and hotel staff all the necessary care and attention so that, despite the inconveniences this situation may cause, they are taken care of in the best way possible,” the hotel group spokesperson added.
A spokeswoman for the Canary Island health department said guests were being monitored for health reasons and they are not calling it a quarantine.
Italy has reported 283 cases and seven deaths from the coronavirus and is experiencing increase in cases.
Five additional European countries reported new coronavirus cases linked to the outbreak in Italy. New infections have been reported in Spain, Austria, Croatia, Switzerland, and France.
The number of confirmed infections related the novel Covid-19 coronavirus surged to more than 79,000, with the cases in mainland China crossing 77,100. In other countries, the cases reached at least 1,300.