January 21, 2021


EUROPE: Managing the pandemic – what we are watching

BY Carsten Nickel, Andrius Tursa, Antonio Barroso, Luis Cornago

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( 7 mins)

This updated weekly piece provides snapshots of how selected European governments are dealing with the ongoing Covid-19 pandemic. Please do not hesitate to contact us if you want to discuss any of the countries mentioned in more detail.

Graph of the week

EUROPE: Managing the pandemic – what we are watching 1


  • Although daily cases have stabilized around 19,000, the Macron administration plans to maintain restrictions in place in the coming weeks. The government has still not decided on when to re-open restaurants and cafes.

  • The health authorities have started vaccinating citizens aged 70+ and at-risk individuals this week. However, only 42% of the available doses have been used so far, and several mayors of key cities have complained that vaccine delivery is being too slow.

  • The government has adopted a draft proposal to introduce a reference to the protection of the environment in the French constitution, which will be eventually voted in a referendum. However, the center-right opposition might use its majority in the Senate to filibuster its approval, complicating the organization of the plebiscite.


  • The health authorities notified more than 41,000 cases on 20 January, the highest number since the start of the pandemic. The central government has rejected the demand by some regions to allow nighttime curfews to start earlier than 11pm.

  • Vaccination is proceeding at a steady pace, as the country has already used more than 75% of the available doses. However, supply issues mean only the citizens aged 80+ will be the next to be vaccinated (and not the aged 70+ as originally planned).

  • A court has suspended the Catalan government’s decision to delay the regional election scheduled to take place on 14 February. A final decision on whether to allow the postponement will be taken in the coming days.


  • Health data appears to show a drop in coronavirus infections (down 24% on the week before), deaths (down 13%), and hospitalizations (down 21%) this week, mainly thanks to the tough measures in place over the festivities. On 14 January, Italy reintroduced its tiered system of restrictions based on each region’s local contagion risk.

  • As of 20 January, Italy had administered more than 1.2 million vaccine shots (roughly 2% of the population), or 77% of the doses already delivered. But reports from regional authorities say the vaccination campaign will be slowed by delays in the delivery of the Pfizer/BioNTech vaccine, the main vaccine in use in Italy.

  • After narrowly surviving this week’s attempt by a junior coalition partner to unseat him, Prime Minister Giuseppe Conte is now seeking to consolidate support for what is now a minority government. A new stimulus package worth EUR 30-32bn is in the pipeline, pushing the 2021 budget deficit to 8.8% of GDP.


  • The seven-day average of new daily infections keeps falling and has reached the number of just over 15.000 cases; with this, Germany is roughly back at the level after the exponential growth of the pandemic during October.

  • The government and the 16 regional states have agreed on extending the lockdown until mid-February, tightening requirements to work from home and for wearing face masks; Chancellor Angela Merkel has also threatened German border closures if EU heads of state or government cannot agree on a joint approach for the identification of high-risk areas, including EU-wide rules for testing and quarantine requirements for people from these regions.

  • The economy ministry is now working towards an overhaul of its system of business support payments, aiming at a reduction of the administrative overhead for applicants who are, in many cases, still waiting for the transfer of support payments for the November lockdown.

United Kingdom

  • The seven-day average of daily new infections stands at just over 40,000 cases and keeps falling. However, the number of deaths remains alarmingly high and keeps climbing.

  • The government is under pressure from its own backbenchers to start easing restrictions as of 8 March – this is, three weeks after the 15 February target set by ministers for the UK to have vaccinated the 14mn most vulnerable citizens; at the same time, additional border restrictions and quarantine rules for travelers are back on the political agenda.

  • The prospect of tax rises in the March budget is again back on the political agenda. Still, the reality is that the chancellor’s program will, first and foremost, depend on the pandemic situation at that stage. With another budget statement planned for the autumn, the March iteration might well see a new round of suggestions and debate regarding corporate tax hikes, but a firmer decision might not arrive until later in the year.


  • Greece’s Covid-19 numbers have dropped considerably this month – less than 50 deaths per day and fewer than 350 intubated patients – allowing the government to relax restrictions. On 18 January, retails stores re-opened under certain conditions. The government’s next goal is to re-open secondary schools rather than other sectors of the economy.

  • The vaccination program continues to proceed slowly. As of 21 January, around 107,000 people had received the jab. This represents just about 1% of the population. The government is aiming to get 17,500 jabs a day administered by the end of the month. Greece is also expected to launch a scheme to provide citizens who have been inoculated with a “digital certificate” proving that they are protected against the virus.

  • A proposal tabled by Greek Prime Minister Kyriakos Mitsotakis for an EU-wide coronavirus vaccination certificate to facilitate travel will be discussed by EU leaders on 21 January. Several EU countries have opposed the idea by raising privacy concerns.


  • The seven-day rolling average of new cases per 1mn people remains around 200. Prime Minister Mateusz Morawiecki is cautious about easing restrictions due to the new strains of the virus.

  • 541,000 people have been vaccinated (1.4% of the population), mostly medical staff, care home residents, and employees. The vaccination campaign is facing setbacks due to reduced deliveries from Pfizer-BioNTech. Nonetheless, the immunization of the elderly (aged 70+) will commence as scheduled on 25 January.

  • Citing the threat of bankruptcies, a growing number of small businesses are re-opening regardless of restrictions. To discourage the trend, authorities are stepping up inspections, handing out penalties for violations. Amid growing pressure, the government is considering a gradual relaxation of measures at the start of February.


  • The epidemiological situation continues to improve, with the average number of new infections per 1mn residents dropping below 130 in the past seven days. However, all pandemic-related restrictions are set to remain in place until 1 February and are likely to be extended beyond this date.

  • 130,000 citizens (1.3% of the population) have been vaccinated, mostly medical staff and nursing home residents. To speed up the process, the government is pushing for domestic regulatory approval of the Sinopharm vaccine to be procured outside the joint EU procedure.

  • Prime Minister Viktor Orban announced plans to scrap personal income tax (up to an average salary) for residents under 25 years old starting 2022. The move – expected to cost the budget HUF 130-150mn (EUR 364-420mn) per annum – targets young voters ahead of the spring 2022 parliamentary vote.


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