May 20, 2021

Europe

EUROPE: Managing the pandemic – what we are watching

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

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Report Contents

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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

France

– The key Covid-19 indicators have continued to improve across the country in recent days. More than 35% of the population has received at least one dose of the vaccine, and the government will allow everyone over 18 years of age to get an appointment for the jab from 31 May.

– The government is planning to adopt an amendment to the 2021 budget on 2 June. The draft bill will add EUR 20bn to this year’s accounts to finance an extension of Covid-19 support measures; it will be discussed in parliament from 11 June.

– A recently published ELABE opinion poll shows that the candidate from the far-right National Rally (RN) party might win the Provence-Alpes-Cote d’Azur region in the elections that will take place on 20 and 27 June unless the left-wing candidate representing four parties withdraws in the second round.

Spain

– Around 36% of the population has received a first dose of the jab. More than 80% of individuals over 70 years of age have been fully immunized. The pace of vaccinations has slowed slightly in recent days, but the average of daily jabs remains above 320,000.

– The government has reached an agreement with employers and trade unions to prolong the state-sponsored temporary workforce reduction scheme until 30 September. An extension of the exemption of social security contributions for the self-employed will also be approved today in an extraordinary cabinet meeting.

– In an opinion delivered on 26 June, the Supreme Court said it opposed granting a pardon to the secessionist politicians currently in prison. However, Prime Minister Pedro Sanchez will likely push for the pardons in the coming weeks, hoping they will lead to sustained cooperation with the secessionist Republican Left of Catalonia (ERC) party.

Italy

– Around 18% of the total population has been fully vaccinated, and another 17.8% is waiting for the second jab. However, there are still 4.3mn citizens above 60 who have not received a single shot, including 415,000 above 80.

– After 100 days in office, Prime Minister Mario Draghi’s job approval rating hovered around the 50% mark, a poll by Quorum/YouTrend published on 24 May showed. Around 22% of those surveyed expressed a negative evaluation, while 27.6% had no opinion.

– State lender Cassa Depositi e Prestiti (CDP) has launched a new EUR 40bn equity fund tasked with helping businesses weakened by the pandemic. The so-called “Patrimonio Rilancio” is a special purpose vehicle to be financed by the Treasury via specifically issued sovereign bonds and managed by the CDP. The fund will invest in non-financial companies with revenue above EUR 50 million.

Germany

– As the Germany-wide seven-day incidence value has fallen below 50, the government is hinting at more encompassing reopening steps only as of a value of 20; the seven-day average of new infections continues its steady decline, now being just above 6,500 cases.

– Risk and age-based priority access to the vaccine will end on 7 June; in anticipation of this, leading politicians have warned of shortages amid an expected run on the vaccine.

– The European regulator EMA is expected to decide on Friday whether to clear the BioNTech/Pfizer vaccine for children as of 12 years and older; ahead of this decision, the German government reiterated that there would be no legal requirement for children to get vaccinated.

United Kingdom

– Despite concerns around the Indian variant of the virus, and after a new round of economic reopening, for now, the seven-day average of new infections remains roughly stable at around 2,500 cases; the mark of 40mn people vaccinated at least once should be reached next week.

-As discussed in the past, the government has tried to tackle the Indian variant via a retightening of restrictive measures in affected local hotspots, but the government’s uncoordinated and badly communicated approach has led to opposition criticism as well as fears for a lack of effectiveness.

– PM Boris Johnson’s former adviser Dominic Cummings – whose own disregard for lockdown rules contributed to his political demise – has reiterated his allegations of pandemic mismanagement and misinformation against the government. However, it is far from certain that the noisy drama will have real political implications for Johnson.

Greece

– The government is under increasing pressure from tourism businesses due to a low number of bookings for June and July. The Hellenic Hoteliers Federation warned that the prospects for the summer season look bleak. Hoteliers are asking for an extension of the low VAT regime and for the furlough scheme, which is due to be withdrawn at the end of June, to be maintained until year-end.

– Despite a clear deterioration in the perception of New Democracy’s record in government, voters do not see main opposition SYRIZA as a credible alternative. A recent poll conducted by Alco for Open TV shows ND holding a 13.2 lead over SYRIZA, with 37.2% of the vote versus 24%. However, over half of respondents indicated they are dissatisfied with the government’s handling of the pandemic.

– Greece has administered just over 5mn jabs as it closes in on at least one dose for one in three Greeks. The government hopes that half the population will have received at least one dose by end-June. However, uptake among Greeks over 60y remains low compared to most EU countries.

Poland

– As new infections and deaths from Covid-19 have dropped to the lowest point since October, the government is continuing with the reopening. Starting 28 May, restaurants with indoor service will be allowed to operate at 50% capacity. All students will return to in-person teaching, and restrictions on various cultural and entertainment events will be relaxed.

– To sustain a rapid pace of vaccination, the government is introducing various financial incentives – including lottery tickets – for immunized residents as well as local governments with the highest vaccination rates.

– Authorities are planning to launch a mass vaccination campaign for teenagers aged 12-18 years old ahead of the start of the next school year in September. A recent survey showed that around 68% of parents are willing to vaccinate their children.

Hungary

– Having provided 5mn residents (52% of the population) with at least one dose of vaccine, the government lifted a curfew, removed all restrictions on retail hours, scrapped a requirement to wear masks outside, and relaxed restrictions on public and private events.

– PM Viktor Orban noted that any further changes to restrictions would depend on the level of new infections rather than vaccination rates, which suggests the government expects the pace of daily jabs to slow down.

– The government is likely to allow the voluntary vaccination of children aged 12 years old and above if approved by the EMA. However, around 27% of the country’s population aged 80 years old and above has not been vaccinated yet.

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