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EU, UK Worry Nascent Economic Rebound Is Being "Derailed" By Delta

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by Tyler Durden
Tuesday, Jul 13, 2021 - 05:45 AM

As Boris Johnson prepares to lift the last of England's COVID-19 restrictions, some of his underlings are already rebelling, insisting that mandatory mask rules remain in effect for public areas.

According to the Guardian, Nadhim Zahawi, the UK's vaccines minister, announced Monday that the government would provide "very clear guidance on issues such as the wearing of masks, as England moves away fro using the laws to govern the response to COVID."

In other words, mask-wearing will be "expected" in the tube and in other crowded public places even after the last COVID related restrictions are lifted.

"I think it’s important that we remain cautious and careful," he told Sky’s Trevor Phillips on Sunday programme. "The guidelines that we will set out tomorrow will demonstrate that, including guidelines that people are expected to wear masks in indoor enclosed spaces, and of course to remain vigilant."

Zahawi clarified that he didn't oppose PM Johnson's plan to reopen, saying that the UK has already fully vaccinated 65% of its adult population.

Imploring white collar Britons to keep working from home, Dr. Susan Hopkins, the incident director for COVID at Public Health England, says "if you are able to do your business effectively from home then I think over the next four to six weeks we should try our best to do that."

And on Monday, new Health Secretary Sajid Javid warned Monday that the number of new COVID cases "will get  lot worse" and that the UK could see as many as 100K cases/day by the summer.

Across the UK and the EU, the lifting of COVID restrictions is causing economists to worry that the EU's brightening economic outlook could be undermined by rising infection levels and the reintroduction of travel and social restrictions.

"I’m a bit more nervous that it could get derailed by Delta," said Erik Nielsen, chief economist at UniCredit, which has raised its eurozone growth forecast for this year from 4% to 4.5%. "It has to get quite bad before we get another lockdown, but Google mobility data shows that it is not so much the lockdowns that drive behaviour but voluntary restraint."

Across Europe, it seems, politicians and bureaucrats are more worried than they were the last time we checked in a few weeks back. And it seems Delta is mostly to blame.

Travel restrictions are already starting to emerge. On Friday, Germany and France warned their citizens against travel to Spain, where the coronavirus infection rate has surpassed Portugal to become the highest in mainland Europe, dealing a blow to the country's tourism sector at the start of what was supposed to be a critical tourism season, but will likely disappoint as officials haven't lowered their guard in time.

Some countries are already moving to reimpose restrictions. The Netherlands said on Friday it would reintroduce restrictions on restaurants, bars, cafés, nightclubs and live events only two weeks after lifting them because of a more than tenfold rise in the country’s daily infection rate to almost 7K in that period.

Cyprus also reintroduced rules on the number of people allowed at hospitality and entertainment venues last week after its daily coronavirus infection rate hit a high for the year. Portugal also said tourists must be fully vaccinated before arriving in the country.

The European Center for Disease Prevention and Control said Friday that the weekly COVID infection rate for the EU and European Economic Area had risen to 51.6/100K people, up from 38.6/100K the week prior. However, hospitalizations and deaths were stable. The agency forecast the infection rate would exceed 90/100K people in four weeks.

Europe isn't alone: A new state of emergency is taking effect in Tokyo Monday as the number of new COVID cases reported in the capital district continues to worsen ahead of the Olympic Games, which are set to begin in under two weeks.

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