One year ago today
The Financial Times has been your guide to the pandemic since the first outbreak was detected. Here are some of the developments we reported a year ago today:
The Covid-19 pandemic showed signs of stabilising in Europe as the situation worsened in large swaths of the US. New York state was hardest hit, adding nearly 9,000 cases and 600 fatalities to its overall tally in one day
A group of world leaders led by Gordon Brown, the former UK prime minister, called on advanced economies to approve immediately a package of almost $200bn to help the world’s poorest countries fight the coronavirus crisis
China’s leadership warned officials to guard against coronavirus entering the country over land borders
Donald Trump announced a deal with 3M, the US manufacturer, to import 166.5m N95 respirator masks into America from abroad
Boris Johnson was in intensive care at St Thomas’ hospital in London after being transferred there as a precaution in case he should need a ventilator. The UK prime minister had been suffering from what had been described as “mild symptoms” of Covid-19 for nine days. Cabinet Office minister Michael Gove said ministers were working together to make decisions in Johnson’s absence. In an update around lunchtime, Downing Street said Johnson was “stable overnight and remains in good spirits”
Gove self-isolated after a member of his family started to display symptoms of coronavirus
School closures have a limited impact on the spread of coronavirus and should be more rigorously weighed against their serious economic impact, according to a study by researchers at University College London
Formula One chief executive Chase Carey was among senior staff set to take a pay cut, as part of measures to mitigate the coronavirus pandemic that would also entail the racing organisation furloughing half its 500 staff
China’s state media reported that Wuhan, the city where the coronavirus outbreak began, would lift its 76-day lockdown
Nissan said it planned to furlough around 10,000 hourly workers at its three plants in the US after it extended their shutdowns because of the coronavirus outbreak
The number of diagnosed Covid-19 cases in Italy rose by the lowest daily level since the crisis began
The European Central Bank changed its rules to start accepting Greek government debt, state-guaranteed credit, and foreign currency loans as collateral to help banks to access its ultra-cheap liquidity in response to the coronavirus pandemic
Trump said his administration was considering whether to “put a hold” on US funding for the World Health Organization, accusing the agency leading the global coronavirus response of being biased towards Beijing and failing to catch the pandemic early enough
The Trump administration was in talks with US senators for an additional $200bn to fund a government lending programme for small businesses
Ireland’s then-prime minister Leo Varadkar urged people not to visit holiday homes or caravan parks in the coming Easter holiday weekend
For all the latest on the pandemic, visit the FT’s coronavirus home page
Americans are using stimulus to cut debt and save, rather than spend
Stimulus payments to US households have primarily driven savings instead of consumption at a time when unemployment remains high and coronavirus restrictions continue to limit activities, according to a study published by the New York Federal Reserve’s blog.
The average share of stimulus payments that US households earmarked for consumption — dubbed the marginal propensity to consume (MPC) — stood at 29 per cent in the first round from the $2.2tn Cares Act last year, Liberty Street Economics authors said in a post on Wednesday, drawing on data from the New York Fed’s survey of consumer expectations.
That slipped to 26 per cent in the second round of payments from the $900bn package passed in December and 25 per cent for the latest $1.9tn stimulus package passed in March.
In contrast, households plan to save about 42 per cent of the latest stimulus cheque. That proportion is up from 37 per cent for the second round of payments and a share of about 36 per cent when the first round of stimulus cheques landed last year.
The authors also said how the stimulus was used varied depending on incomes and education levels. With the second round of payments, where households received an average of $1,314, those that made less than $40,000 planned to use 44 per cent of their cheques to pay down debt, compared to 32 per cent for households that earned more than $75,000.
The data also showed that households without a college degree reported using less of the funds on consumption and more on paying off their debt.
The March survey yielded similar information about actual and expected uses for the third round of payments.
The authors said:
Our findings indicate that in an environment that continues to be characterised by constraints on many activities and by high unemployment, as well as high uncertainty about the duration and continued economic impact of the pandemic (including elevated uncertainty about future inflation), fiscal support continues to impact predominantly savings instead of consumption, with households planning to use the third relief payments mostly to pay off debt and save.
They added that high savings should boost spending in the future but that there is still uncertainty about how much will be spent and how much pent-up demand there is.
The US personal savings rate peaked at 33.7 per cent last April and was down to a still-high 13.6 per cent in February, according to the Bureau of Economic Analysis. Before the pandemic hit, the rate had never exceeded 20 per cent and had most recently topped 15 per cent in 1975.
Fed officials shrugged off fears of overheating economy, minutes show
Federal Reserve officials said the danger of unexpectedly high inflation was roughly equal to that of unexpectedly sluggish inflation, shrugging off fears of a rapidly overheating economy in the wake of Joe Biden’s $1.9tn fiscal stimulus.
“Most participants noted that they viewed the risks to the outlook for inflation as broadly balanced,” according to minutes of the Federal Open Market Committee’s meeting in March, released on Wednesday.
“Several remarked that supply disruptions and strong demand could push up price inflation more than anticipated. Several participants commented that the factors that had contributed to low inflation during the previous expansion could again exert more downward pressure on inflation than expected,” they added.
At the March meeting, the Fed sharply revised higher its forecasts for growth and inflation, but according to the minutes, officials signalled no urgency to begin pulling back their ultra-accommodative monetary support, which includes $120bn per month of asset purchases and its main interest rate close to zero.
US health care groups to study treatment for ‘Covid brain fog’
A cadre of US health care groups are studying a potential treatment for people suffering from “Covid brain fog.”
Akili Interactive, a Boston-based company that developed a video game-based treatment for children with ADHD, has partnered with Weill Cornell Medicine, NewYork-Presbyterian Hospital and Vanderbilt University Medical Center to test Akili’s digital therapeutic AKL-T01 as a treatment for cognitive dysfunction in people who had Covid-19.
Akili said on Wednesday it will work with its partners’ research teams to conduct two separate clinical studies “evaluating AKL-T01’s ability to target and improve cognitive functioning in Covid-19 survivors who have exhibited a deficit in cognition.”
“With more than 100m infections globally and counting, the potential impact of long-term cognitive impairments in even a subset of these patients is devastating,” said Dr Anil S Jina, Akili’s chief medical officer.
Akili cited a study published in the medical journal Neuropsychopharmacology that said 81 per cent of the patients included in the study “exhibited objectively documented cognitive deficits” that affected attention and other functions. The researchers evaluated 57 hospitalised patients with Covid-19 who required inpatient rehabilitation before their discharge.
England’s deputy chief medical officer explains new vaccine advice for under-30s
Following the announcement by the UK medical regulator that the Oxford/AstraZeneca vaccine should not be used for adults aged 18-29, England’s deputy chief medical officer sought to explain how the risks and benefits of the jab balance out for different age groups.
Much depends on how widespread infections are, said Jonathan Van Tam in a televised briefing.
He said that based on a relatively low infection rate of 2 cases per 10,000 people - close to the rate in the UK in March - the potential benefits of receiving the AstraZeneca vaccine among people aged 20-29 did not outweigh the risks of serious side effects.
The risk-benefit balance reversed for people aged over 30, however. For people aged 60-69, for example, the risk-benefit balance was “heavily in favour of taking the vaccine,” said Van Tam.
The greater the prevalence of the disease in a population, the greater the benefits of receiving the vaccine - in terms of ICU admissions avoided - among all age groups, he added.
Based on a relatively high infection rate of 20 cases per 10,000 people - close to the rate during the UK's second wave - the benefits of taking the AstraZeneca vaccine exceeded the risks even for people aged 20-29.
Erdogan vows to lower Turkey’s interest and inflation rates
Turkey will bring both interest rates and inflation down to the single digits, President Recep Tayyip Erdogan said a week before the central bank holds its first rate-setting meeting with a new governor whose surprise March appointment unnerved investors.
Erdogan has long railed against high interest rates, which he says causes inflation contrary to mainstream economic theory, and has changed the central bank chief three times in less than two years. He fired Naci Agbal last month two days after he raised rates to 19 per cent to tame inflation running at 16 per cent.
“We will succeed in bringing inflation, which has shown a little increase recently, back to the single digits,” Erdogan told lawmakers from his ruling party on Wednesday. “We are determined to lower interest rates to the single digits.”
Erdogan has not offered a reason for sacking Agbal, who took the job in November when the lira had sunk to record lows and promised a more orthodox monetary policy to boost investor confidence. Sahap Kavcioglu, an academic and newspaper columnist, who has written in support of Erdogan’s unconventional view about the link between interest and inflation succeeded Agbal.
However, Kavcioglu has indicated he won’t immediately undo Agbal’s policies at the next monetary policy committee meeting on April 15. He has also pledged to meet the central bank’s year-end inflation target of 5 per cent.
The shakeup at the central bank unnerved foreign investors, who dumped $1.9bn of Turkish stocks and bonds in a single week. But Erdogan said Turkey’s economy “has achieved a large degree of resilience against shocks” and was now seeing strong demand for tourists, despite the coronavirus pandemic.
Turkey recorded 49,584 new coronavirus cases on Tuesday, the biggest daily increase of the pandemic. The country has fully vaccinated 7.4m people, or about 9 per cent of its population.
Willie Walsh tells UK airports not to use the pandemic to jack up prices
Willie Walsh, the former head of British Airways, has returned to the airline industry with a blunt warning to Heathrow and other airports not to use the pandemic to jack up prices.
The Irish executive used his first media appearance in his new position as head of the International Air Transport Association airlines body to accuse other parts of the industry of monopolistic pricing.
“If I look at traditional problems in this area it is the likes of airports like Heathrow who have clearly demonstrated they want to recover lost revenues . . . we will be very strong and aggressive in opposing this,” he told a press conference.
Heathrow has applied to the UK regulator for permission to increase the fees it charges airlines by 5 per cent to help offset a dramatic fall in flights.
New figures have underlined the severity of the crisis facing airlines. Global flights operated at just 25 per cent of normal levels in February, the latest month for which data is available.
German state of Bavaria signs deal for 2.5m Sputnik V doses
Bavaria has signed a preliminary contract for 2.5m doses of the Russian Covid-19 vaccine Sputnik V pending its approval by the European Medicines Agency, becoming the first German state to conclude such a bilateral deal.
In a press release, the Bavarian health ministry said it had signed a memorandum of understanding with the Russian Direct Investment Fund, the Kremlin’s sovereign wealth fund, and the distribution company RDIF.
Bavarian health minister Klaus Holetschek said that Germany would “not have enough vaccine against the SARS-CoV-2 virus for the foreseeable future, though infection numbers are rising”.
“For that reason, Bavaria is banking on the purchase and deployment of the Russian vaccine Sputnik V as soon as it is approved by the European Commission”.
He said that in addition to the option of importing the vaccine from Russia, it could be produced by the company R-Pharm Germany GmbH in the west Bavarian town of Illertissen. The health ministry said recent experience with vaccine supply had shown that it is “very important to create regional production capacity in Germany too”.
Germany’s inoculation programme has been dogged by delays and shortages of vaccine. The country outsourced the procurement of shots to the EU, but several German politicians have demanded it conclude separate, bilateral deals to increase supplies. Bavaria is so far the only state to have done so.
The EMA will launch an investigation next week into whether clinical trials of Sputnik V contravened ethical and scientific standards.
People familiar with the EMA’s approval process told the Financial Times that they had concerns the trials had been ethically run. Russia has said military servicemen and state employees were involved in the trials of the jab, which was developed by a state-run laboratory and funded by the Russian Direct Investment Fund.
Carnival says advance bookings strong as it reports $2bn quarterly loss
Carnival, the world’s largest cruise company said bookings for holidays in 2022 were ahead of 2019’s levels indicating that there is pent-up demand for cruise trips despite its turbulent year.
“We are focused on resuming operations as quickly as practical,” said Carnival’s chief executive Arnold Donald in a statement, as the company posted a $2bn net loss for the first three months of 2021.
Carnival said bookings in the first quarter of 2021 were 90 per cent up on the final quarter of 2020. It added that customer deposits for cruise holidays amounted to $2.2bn as of the end of February, the majority of which were credits due following holidays that had been cancelled as a result of the pandemic. But it added that customer deposits for new bookings during the quarter offset the impact of refunds to be paid out.
Tensions have arisen this week between the Centers for Disease Control and Protection and cruise lines after the US healthy agency announced a set of strict protocols ships must adhere to for cruising to restart in US waters.
The CLIA, the industry trade body, called the measures “onerous” and said they were at odds with the loosening of pandemic-related restrictions in other parts of the economy.
Carnival said on Wednesday that it expected six of its nine brands to resume cruising this summer but only in Europe, starting with its Aida line in the Canary Islands.
Donald said he expected the company, which became a focus early on in the pandemic thanks to an outbreak on ships in its Princess line, to emerge “operationally stronger” after the crisis. It has retired 19 ships from its fleet and Donald said it was “streamlining shoreside operations”.
The company said its cash burn rate during the first quarter was $500m — $100m lower than it had previously guided — and that it had $11.5bn of cash and investments thanks to a $1bn share placing and raising $3.5bn in debt.
UK regulator changes advice on AstraZeneca vaccine
The UK medical regulator has advised that the AstraZeneca vaccine should not be used for adults aged 18-29, although it would not restrict use of the jab in any other age group.
Men and women under the age of 30 should now be offered either the BioNTech/Pfixer vaccine or the Moderna vaccine, the regulator said.
Up to the end of March, 79 cases of the blood clots had been identified in the UK, resulting in 19 deaths. In total, 51 of the cases were women and 28 were men, with ages ranging from 18 to 79. Three out of the 19 who died were under the age of 30.
As well as the ‘change of clinical preference’ being outlined for adults under the age of 30, the regulator said pregnant women and those with a history of blood disorders linked to an increased risk of clotting should discuss the relative benefits and risks with a medical professional.
They also said that anyone who had experienced the rare blood clots coupled with a low platelet count after the first shot of the vaccine should not be given the second dose.
The Chair of the Committee of Human Medicines, which has been working with the MHRA, has advised that the link between vaccine and clots is “getting firmer”, but that absolute proof will only come after extensive scientific work.
The change in advice will not affect the timeline for the rollout of the vaccine, officials said.
London-listed shares in the company closed 1.2 per cent lower at £70.99 on Wednesday.
EMA says blood clots are a very rare side effect of AstraZeneca vaccine
The European Medicines Agency has concluded that a very rare and severe combination of side effects, including blood clots in the brain, can be caused by the Oxford/AstraZeneca Covid-19 vaccine, but it continued to stress that the shot’s benefits outweigh its risks.
“Covid-19 is associated with a risk of hospitalisation and death,” the EMA said. “The reported combination of blood clots and low blood platelets is very rare, and the overall benefits of the vaccine in preventing Covid-19 outweigh the risks of side effects.”
The agency reminded patients to seek immediate medical assistance if they experience symptoms, including shortness of breath, chest pain, or leg swelling, after vaccination.
The regulator said specific risk factors could not be identified.
Most of the cases reported have occurred in women under the age of 60, it said, mostly within two weeks of patients receiving their first dose. There is “limited” experience with patients receiving a second dose, it added.
UK universities demand clarity on in-person teaching
The Department for Education has said it will review options for the return of students to university, after vice chancellors accused the government of creating a “communications vacuum” over the timing of a full restart of face-to-face higher education.
Universities UK, the sector’s lobby group, on Wednesday wrote to the government asking why restrictions on in-person teaching were set to remain in place despite the planned reopening of large sections of the economy on April 12.
Julia Buckingham, the president of UUK, said it was “illogical” that students were not allowed to return to self-catered accomodation and resume classes in “covid-safe university facilities” when gyms, parks, theme parks, public libraries and community centres were all set to open.
“This is another blow for those students who have been studying online since early December,” she said, arguing that “many studies highlighting the impact on students’ mental health, wellbeing and development” supported a faster return.
English universities stopped most face-to-face teaching during the most recent national lockdown, though students taking essential practical courses were allowed to return to campus on March 8. UUK had previously argued that a full return to campus on April 12 would balance safety with student wellbeing.
In response to UUK’s intervention, the DfE said it would be “reviewing options for the timing of the return of all remaining students by the end of the Easter holidays”.
US trade deficit hits record high of $71.1bn in February
The US trade deficit swelled to a record high in February as the US experiences a faster economic recovery from the coronavirus crisis than other advanced economies.
The deficit in goods and services grew 4.8 per cent month on month to $71.1bn in February, according to data released by the US Census Bureau on Wednesday. That was wider than economists’ expectations of $70.5bn, according to a Reuters poll.
Exports fell 2.6 per cent or $5bn to $187.3bn, while imports slipped a more modest 0.7 per cent or $1.7bn to $258.3bn.
The goods deficit with China increased by $3.1bn to $30.3bn, the report showed.
It is likely that trade was affected by severe winter weather in the US last month, but the deficit is expected to continue to widen this year.
Oren Klachkin, economist at Oxford Economics said that the vaccination roll-out and easing of pandemic-driven restrictions, along with US president Joe Biden’s $1.9tn stimulus, would boost domestic demand and imports. “Exports will gather steam more slowly, with external demand likely to stay Covid-constrained,” he added.
The International Monetary Fund on Tuesday forecast that the global economy would grow 6 per cent this year, while the US would grow 6.4 per cent.
Medical regulators to issue updates on possible AstraZeneca jab blood clot risks
Medical regulators in the UK and EU are preparing to issue updates on the safety of the Oxford/AstraZeneca coronavirus vaccine.
Both the European Medicines Agency and the UK’s Medicines and Healthcare products Regulatory Agency are due to provide more details in separate briefings at about 3pm London time.
The updates will be closely watched. Regulators have been investigating possible links between the vaccine and extremely rare, but potentially fatal, blood disorders in adults who have received it.
Several countries have restricted its use as a precautionary measure. Germany has recommended that younger people, who are both more likely to be affected by the blood clots and at lower risk from coronavirus, avoid the jab.
The MHRA, the EMA and the World Health Organization have all said there is no evidence of a causal link between the vaccine and the condition.
The UK’s briefing will be televised live and will include Jonathan Van-Tam, England’s deputy chief medical officer, and June Raine, the MHRA’s chief executive.
The Financial Times will be bringing readers news and analysis of both briefings.
CoronaVac vaccine effective against Brazil variant
A study of healthcare workers in Manaus indicates that the Chinese-made CoronaVac vaccine is effective against the virulent P.1 Covid-19 variant, which emerged from the city in Brazil's Amazon region late last year.
The study of 67,718 health workers by the Verba Covid-19 group found that the jab was 50 per cent effective in preventing the disease two weeks after the first dose. The researchers are awaiting more data to assess the efficacy rate after the second dose.
The P.1 variant - also known as the Manaus variant - is predominant in the city and is widely believed to be behind the soaring number of coronavirus cases in Brazil today.
Latin America's largest nation on Tuesday reported 4,195 daily deaths and 86,979 new cases of coronavirus. Scientists expect these numbers to continue to increase throughout April.
South Korea pauses rollout of Oxford/AstraZeneca vaccine for under-60s
South Korea's coronavirus vaccination rollout faces fresh delays after health officials decided to temporarily suspend the use of the Oxford/AstraZeneca vaccine for people under the age of 60 over worries it may be linked to instances of rare blood disorders.
The move by Seoul follows similar curbs and recommendations by countries including France, Canada and Germany, as health officials run new risk assessments. The World Health Organization, as well as UK and EU regulators, have all stated that any possible risks are outweighed by the benefits of the vaccine.
Jeong Eun-kyeong, the Korea Disease Control and Prevention Agency chief, said the decision was taken pre-emptively given public safety concerns.
"We will address the problem quickly through in-depth discussions with domestic experts based on the EMA announcements,” she said, referring to the European Medicine Agency, the EU medical regulator.
The South Korean government aims to vaccinate about 70 per cent of the country’s 52m people by September in a bid to reach herd immunity by November.
While much of the country is operating without restrictions, strict border controls remain in place and gatherings of more than four people continue to be prohibited to curtail infections. Daily new cases hit their highest point since January on Wednesday at 668.
IMF proposes ‘solidarity’ tax on pandemic winners and wealthy
High earners and companies that prospered in the pandemic should pay additional tax to show solidarity with those who were hit hardest, according to the IMF.
A temporary tax would help to reduce social inequalities that have been exacerbated by the economic and health crisis of the past year, the fund said in its twice-yearly fiscal monitor on Wednesday. It would also reassure those worst affected that the fight against Covid-19 is a collective endeavour.
Vitor Gaspar, the IMF’s head of fiscal affairs, told the Financial Times that a symbolic rise in taxation from those who have prospered over the past year would strengthen social cohesion even if there was not a pressing need to repair the public finances.
Read more here
Czech Republic appoints fourth health minister since start of pandemic
Czech prime minister Andrej Babis replaced his heath minister on Wednesday, following a series of disputes over vaccines and experimental treatments for Covid-19.
Jan Blatny, who had been in office since October, will be replaced by Petr Arenberger, who will become the Czech Republic’s fourth health minister since the pandemic started sweeping through the country last year.
Blatny’s departure follows a series of clashes with Babis and Czech president Milos Zeman, who criticised him for his opposition to purchasing vaccines not approved by the EU, such as Russia’s Sputnik V jab, and his insistence that experimental Covid-19 medicines could only be used in limited circumstances.
Arenberger, the head of Prague’s University Hospital Vinohrady, takes over as the Czech Republic is slowly recovering from a huge surge in cases in February, which pushed the health system to the brink of capacity.
In total, the 10.8m-strong Czech Republic has recorded 1.56m cases of coronavirus and 27,329 deaths.
Jamie Dimon predicts post-pandemic boom for US
A huge rise in US government spending will boost the world’s largest economy over at least the next two years, said the chief executive of JPMorgan Chase.
Jamie Dimon offered the upbeat outlook in his annual letter to shareholders, in which he asserted that high savings rates, stimulus programmes, a potential infrastructure package and “euphoria around the end of the pandemic” were likely to jump-start the US economy.
“It is possible that we will have a Goldilocks moment — fast growth, inflation that moves up gently (but not too much) and interest rates that rise (but not too much),” Wall Street’s leading banker said, adding that sustained spending could fuel a years-long hot streak.
Consumers and companies appeared to be in great financial health as the country starts to emerge from the crisis, said Dimon, who heads the largest US bank by assets.
Even before Joe Biden’s $1.9tn stimulus package was passed last month, JPMorgan estimated that retail customers had roughly $2tn in excess savings. Large companies, meanwhile, are carrying a sizeable $3tn cash cushion on their balance sheets.
Additionally, expansionary actions taken by monetary authorities around the world should have “a compounding global effect”, Dimon said.
Read more here.
First UK Moderna vaccine given to 24-year-old carer
A 24-year-old unpaid carer has become the first UK recipient of Moderna’s coronavirus vaccine as the rollout begins in Wales.
Elle Taylor, who looks after her grandmother, said she was “very excited” to receive the US company’s shot at Glangwili Hospital in Carmarthen.
The UK government has ordered 17m doses of the Moderna vaccine, which is the third to be administered in the country after the Oxford/AstraZeneca and BioNTech/Pfizer jabs.
It is expected to be offered across the UK around the third week of April and more batches should be made available next month.
The introduction of a third jab improves the UK’s security of supply at a time of increasing questions about a possible link between the AstraZeneca vaccine and rare blood clots.
Ministers remain confident that all UK adults will be offered vaccinations by the end of July.
UK services activity rebounds in March
The UK’s services activity rebounded in March, according to a survey that showed a pick-up in business activity and new orders as well as the first expansion of staff numbers across the sector since the start of the pandemic.
The IHS Markit/Cips purchasing managers’ index for services increased to 56.3 in March from 49.5 in February, signalling the fastest rate of expansion for seven months.
Any reading above 50 shows the majority of survey respondents reported a growth in activity. The reading was down slightly from an interim reading of 56.6, which was published last month based on around 85 per cent of responses.
"The dominant service sector moved up several gears into growth with a strong leap in overall output, topped off with a rise in job creation for the first time since the pandemic began at the beginning of 2020,” said Duncan Brock, group director at the Chartered Institute of Procurement & Supply.
Survey respondents reported a recovery in spending ahead of the planned reopening of the economy, boosted by the release of pent-up demand on previously delayed projects and a rise in future bookings.
Input price inflation rose to its highest level for 33 months, however, with higher operating expenses in many cases passed on to clients.
“Regardless of whether the sector’s glass is now half empty or half full, the acceleration in input price inflation to its highest in nearly three years is a worry,” Brock said.
March data also suggested an increase in manufacturing activity, as the composite output index, a weighted average of manufacturing and services indices, increased to 56.4 from 49.6 in February.
Italy services activity held down by Covid restrictions
The downturn in Italy’s services activity accelerated in March as a third wave of the pandemic continued to cloud the economic outlook. But there was better news from Spain, where activity fell by less than expected.
The IHS Markit purchasing managers’ index for Italy’s services, a measure of the health of the sector, dropped marginally to 48.6 in March from 48.8 in the previous month.
This was lower than the 49 forecast by economists polled by Reuters and below the 50 mark, which indicates a majority of businesses reporting a contraction.
Lewis Cooper, economist at IHS Markit, said Italy’s service sector “remained stuck in a downturn” at the close of the first quarter. He explained that business activity fell further in part because of a renewed dip in inflows of new work, with panelists citing weak demand due to Covid-19 restrictions.
New orders from abroad also decreased in March, extending the 21 months of uninterrupted contraction.
The PMI services index for Spain rose more than expected, however, to 48.1 in March from 43.1 in the previous month.
Businesses in Spain said activity continued to be negatively impacted by Covid-19 restrictions during March but not to the same degree as in recent months. Some businesses reported an improvement in underlying demand.
Confidence about the future was high in both countries, thanks largely to the rollout of vaccination programmes seen by businesses as key to reducing the negative impacts of the pandemic on activity.
However, the downturn in activity led businesses in both countries to further cut jobs.
Hungary eases restrictions despite record death rate
Hungary recorded a fresh high in Covid-19 fatalities on Wednesday morning, the same day the country eased restrictions, attracting criticism that the government is prioritising economic recovery over minimising infections.
Hungary relaxed its curfew restrictions and announced the reopening of many shops and services, as deaths in the previous 24 hours hit a record of 311 in the country of 9.7m people.
Premier Viktor Orban said on Tuesday that the restrictions could be relaxed because 2.5m people, or a quarter of the population, had received at least one dose of a vaccine.
“Today, we reached an important milestone,” Orban said when he announced the easing of restrictions.
“The virus waged a war against us, and the only weapon that promises victory is the vaccine.”
Hungary has the second highest vaccination rate in the EU but Covid deaths continue to break records. On Wednesday, Hungary’s surgeon general Cecilia Muller said almost 2,000 new infections had been registered, mostly due to the variant first identified in the UK.
Hungary eschewed EU inoculation guidelines and relied on the Chinese-made Sinopharm vaccine and the Russian-made Sputnik V to become one of the world’s most vaccinated countries.
“Hungary can be and will be the European country where everyone gets a vaccine the fastest,” said Orban.
Last week, 28 media outlets sent an open letter to the government demanding access to hospitals and medical personnel, and complaining that only state-run media can enter public health institutions.
“Since people are cut off from this information . . . many are still downplaying the dangers of the pandemic, and are not observing protective measures which is leading to more illness and thus an exacerbation of the pandemic,” the letter said.
WHO warns cases in Philippines approach ‘red line’
The World Health Organization has raised the alarm about surging coronavirus infections in the Philippines, as President Rodrigo Duterte cancelled a weekly speech and the country’s defence chief said he was self-isolating.
“We are concerned about the situation in the Philippines,” Takeshi Kasai, the WHO western pacific regional director said in online remarks quoted by the Manila Bulletin.
He said the country was approaching a so-called red line, where case numbers exceed healthcare capacity.
The warning from the WHO came as Delfin Lorenzana, defence secretary, said on Twitter that he was working from home and in isolation after he tested positive for coronavirus on Tuesday.
Duterte’s regular Wednesday night speech, which he has given since early in the pandemic, has been moved to next week, according to Harry Roque, the president’s spokesman. Roque cited “the rising number of active Covid-19 cases”, in remarks quoted by the website Rappler.
The Philippines has reported a surge in infections over the past month. This week authorities extended a strict lockdown in greater Manila and four adjoining provinces for another week.
The Duterte administration is coming under growing domestic criticism for its handling of the pandemic, and the surge in new cases has also coincided with rising tensions between Manila and Beijing over the South China Sea.
The Philippines, which has a population of 110m, has reported 812,170 Covid-19 cases to date and 13,817 deaths from the disease.
India could resume exports of AstraZeneca vaccine in June
The Serum Institute of India, the world's largest vaccine manufacturer, could resume exports of the Oxford/AstraZeneca vaccine in June provided domestic cases of coronavirus are falling, the company’s chief executive has said.
Adar Poonawalla warned that the company would have to satisfy Indian demand, further delaying exports, if infections in the country of 1.4bn people continue to climb.
India recorded a record 115,269 new coronavirus infections on Tuesday, as its second wave outpaced those seen in Brazil and the US.
The Serum Institute has "chosen to prioritize India temporarily for two months" and hopes to then restart exports, Poonawalla said in an interview.
He cautioned that the vaccine was not "bulletproof", explaining that other vaccines including pneumonia and rotavirus do not offer "complete disease penetration and transmission," but work to lessen the severity of the disease.
He acknowledged that variants represent a "question mark" about effectiveness. "Nothing today created by man is 100 per cent, it works most of the time but not all the time," he said.
Poonawalla also called for a grant from New Delhi to expand production capacity at his plant, where a fire earlier this year delayed the expansion of monthly coronavirus vaccine production from about 70m doses a month to 100m doses.
Iran’s president denies using sanctions as excuse for slow vaccine rollout
Iran’s president Hassan Rouhani has alleged that US sanctions have hampered the country’s access to vaccines, saying difficulties in securing supplies are “not our excuse, rather a reality”.
Rouhani said some countries were ready to sell Iran vaccines but sanctions imposed by Washington had complicated Tehran’s ability to procure them, since parts of the jabs came from companies with connections to the US.
“Sanctions are not our excuse rather a reality,” he said at a cabinet meeting on Wednesday.
Although US sanctions exempt food and medicine, global companies fear any transactions with Iranian businesses — direct or indirect — could bring them heavy punishment and risk their interests in the US.
Iran has the highest fatality rate in the Middle East, with 63,506 deaths. Confirmed cases meanwhile hit an all-time high on Tuesday.
Rouhani said US sanctions had also undermined Iran’s ability to receive vaccines under the World Health Organization’s Covax programme. The country, which has a population of 83m, is entitled to receive 16.8m doses of vaccines under Covax, of which 700,000 arrived on Monday.
“We were amongst the first countries which joined the Covax programme but faced the hurdle of sanctions when we wanted to pay,” Rouhani said.
The Islamic republic started vaccinating medical staff in February with Russia’s Sputnik V. Of 2m doses that are due to arrive, 520,000 have been imported so far.
Domestically produced vaccines should be available from May, following the completion of clinical trials.
Reserve Bank of India keeps interest rates on hold amid surge in infections
India’s central bank kept benchmark interest rates unchanged at 4 per cent as the country confronts a widespread surge in Covid-19 infections.
The Reserve Bank of India’s monetary policy committee said it would maintain an “accommodative stance” to “support and nurture the recovery” from the pandemic, despite concerns about inflation.
India reported a record of more than 115,000 new cases on Tuesday, with the government warning that the next four weeks would be “critical”.
The RBI left its growth target for the year ending March 2022 unchanged at 10.5 per cent, after an 8 per cent contraction the previous year. It added however that the local lockdowns that have followed the recent surge in cases could hurt demand.
Separately, the International Monetary Fund on Tuesday raised its estimate for the same period to 12.5 per cent growth. But IMF chief economist Gita Gopinath clarified that the estimates were made before the “concerning” increase in infections.
Older people should take AstraZeneca vaccine even if blood clot link found, says professor
Older people should continue to receive the Oxford/AstraZeneca vaccine even if it is found to cause blood clotting in some cases as the benefits would still outweigh the risks, a professor of paediatrics has said.
Adam Finn of Bristol university said the serious adverse events were so rare that older people should “very obviously [be] in favour of getting vaccinated”, as they are far more likely to die from Covid-19.
But the same might not be true for younger people, he said, as they are less susceptible to the virus.
“What we urgently need to understand, if this is a causal thing, is whether that risk-benefit ratio stands up when you get down to younger ages,” Finn told BBC Radio 4's Today programme.
Oxford university this week paused a trial in under-18s of the jab it has developed with AstraZeneca, ahead of new risk assessments by regulators investigating possible links with potentially fatal blood disorders in adults.
Seven people have died in the UK as a result of unusual blood clots having received the AstraZeneca vaccine, compared with more than 18m who have so far received it.
Oil price rises help Royal Dutch Shell
Royal Dutch Shell said higher oil prices enabled its exploration and production business to perform well in the first quarter, even as gas trading results were expected to be “significantly below average”.
The Anglo-Dutch major said in a trading update on Wednesday that its adjusted earnings in the upstream business in the first three months of this year would be “positive” after a series of hits to its core business from the coronavirus pandemic in 2020.
The company, which reports earnings later this month, said freezing weather in the US oil hub of Texas decreased output by up to 20,000 barrels a day, and hit earnings by $200m.
Energy analysts and traders are watching how the sector recovers after the coronavirus crisis dramatically hit the global economy and consumption of oil and gas.
Shell, which is a global fuel retailer, said refined oil product sales were 3.7-4.7m b/d in the first quarter compared with 4.8m b/d in the fourth quarter of 2020.
Ryanair blames slow EU vaccine rollout for low passenger numbers
Ryanair has warned it will carry fewer passengers than expected over the next year and struggle to turn a profit because of the slow rollout of vaccinations across much of Europe.
The low-cost carrier said lockdowns and travel restrictions have hit travel during the Easter period, and it expected a delayed recovery in traffic into the summer season.
It forecasts passenger numbers in the year ending March 2022 towards the lower end of a previously guided range of between 80m and 120m.
As a result, Ryanair warned that some analyst forecasts predicting the carrier will return to profit over the next year are over-optimistic.
“While it is not possible at this time to provide meaningful full-year 2022 profit guidance, we do not share the recent optimism of certain analysts,” Ryanair said, adding that at present it expected to approximately break even.
Just two weeks ago Michael O’Leary, Ryanair’s chief executive, struck a more bullish tone as he predicted a strong summer of travel across Europe.
Analysts believe Ryanair will over the long-term emerge from the crisis as a winner in European aviation, helped by a low cost base and strong balance sheet.
For now, however, the airline remains exposed to travel restrictions and rising cases across much of continental Europe.
Ryanair expects to record a net loss before exceptional items of between €800m and €850m for the year ending March 2021, slightly better than its previously guided range of between €850m to €950m.
Saga says vaccinated over-50s ready for holidays
Saga, the UK travel and insurance company catering to over-50s, has said there is “significant pent-up demand” from customers ready to travel when its cruise and holidays division resumes following the pandemic.
Euan Sutherland, chief executive, said the vast majority of customers had been vaccinated and were “ready to enjoy post-lockdown freedom”. Results released on Wednesday showed total cruise bookings for 2021-22 and 2022-23 were £154m, up a fifth on a like-for-like basis.
The group posted a £61m loss before tax for the year to January, reflecting a coronavirus-related impairment taken against its travel businesses in the first half.
The performance was nevertheless an improvement on the £301m pre-tax loss in Saga’s previous financial year, which was caused by a writedown at its insurance division following a change in accounting rules.
A decline in motor insurance claims as drivers stayed at home delivered a profitable underlying combined operating ratio – claims and expenses as a proportion of premiums – of 91 per cent.
The second-half cash burn rate in Saga’s travel business remained at the lower end of previous guidance, of between £6m and £8m a month.
“While we are mindful of economic headwinds and the potential ongoing impacts of Covid-19, it is clear that there is significant pent-up demand among our customer base,” Sutherland said in a statement.
Saga announced a policy in January that all travellers will need to be vaccinated. The company said it was ready to resume travel operations this year, when government restrictions allow.
But given the Covid-19 uncertainty, Sutherland said the company was unable to provide earnings guidance for the 2021-22 financial year.
Saga had £75m of available cash at the year-end and an undrawn credit facility of £100m. Its leverage ratio excluding the cruise business — as by measured net debt to trading ebitda — rose from 2.4 times a year ago to 2.7 times.
However, that remained comfortably beneath a limit of 4.75 times written into its debt agreements.
EU life expectancy drops after decades of increases
Life expectancy dropped in 2020 across the EU after decades of steady increases, according to official statistics that laid bare the impact of Covid-19.
Following the outbreak of the pandemic, life expectancy at birth fell in the vast majority of EU member states for which 2020 data is available, according to Eurostat.
The largest decrease was recorded in Spain with a fall of 1.6 years compared with 2019, followed by Bulgaria, Lithuania, Poland and Romania with marginally smaller drops.
In Spain, a newborn in 2020 could expect to live 82.4 years, compared with 84 years in 2019, which means life expectancy was back to the level registered in 2010.
Germany, France and Italy registered falls of 0.2 years, 0.7 years and 1.2 years respectively.
Life expectancy at birth, the average number of years that a newborn child would live if subjected to current mortality conditions, has risen, on average, by more than two years a decade since the 1960s across the EU.
EU regulator to probe ethical standards of Sputnik vaccine trials
The EU drug regulator will launch an investigation next week into whether clinical trials of Russia’s Sputnik V Covid-19 vaccine contravened ethical and scientific standards.
The European Medicines Agency’s probe into whether Sputnik V trials met “good clinical practice” standards comes as people familiar with the regulator’s approval process told the Financial Times of their concerns that they had not been ethically run. GCP is an internationally agreed standard aimed at ensuring that drug trials are designed and conducted properly.
Russia has said military servicemen and state employees were involved in trials of the jab developed by a state-run laboratory and funded by the Russian Direct Investment Fund, the Kremlin’s sovereign wealth fund. The Reuters news agency has reported that some who took part described being pressured to do so by their superiors.
Kirill Dmitriev, head of the RDIF, denied the use of coercion, telling the FT: “There was no pressure [on participants] and Sputnik V complied with all clinical practices”. He said the EMA inspection was scheduled to begin next week.
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HK warned off Oxford/AstraZeneca vaccine over variant concerns
An adviser to the Hong Kong government on the Covid-19 pandemic, has said the Chinese territory should hold off on ordering the Oxford/AstraZeneca vaccine citing concerns about its effectiveness against certain variants.
"For the AstraZeneca vaccine, the vaccine's effectiveness against the South African strain is down to 10 per cent, and this is undesirable," said David Hui, who is also chairman of the Department of Medicine & Therapeutics at the Chinese University of Hong Kong.
"We have enough vaccines for the whole of the Hong Kong population at the moment. So I think at this stage we don't have any urgent need to purchase a third vaccine. I think we should keep resources and watch out for any new developments."
Hong Kong has already rolled out vaccines from China's Sinovac, which is yet to publicly release its underlying phase 3 trial data, and BioNTech, whose shot is being delivered to Hong Kong in concert with Chinese company Fosun.
An expert panel that approved the use of Sinovac's CoronaVac vaccine in Hong Kong has previously said of the shot: "There is currently no information regarding [its] immunogenicity against the new variant strains including the South African virus strain."
Hong Kong has ordered 7.5m doses from AstraZeneca and the first batch had been expected to be delivered in June.
Patrick Nip, the secretary for the civil service, said in a Facebook post on Tuesday that the supply period for the BioNTech vaccine was limited, without providing further details. "Go as soon as possible if you want to get vaccinated," he said.
India reports all-time high of 115,000 new cases
India reported a record of 115,269 new Covid-19 cases on Tuesday, as government health officials warned that the coming four weeks will be “critical” in controlling the spread of the virus.
More than 630 people died of Covid-19 in India on Tuesday, bringing the country’s total death toll since the pandemic began to more than 166,200.
India's surge in cases since mid-February has been blamed on a combination of pandemic fatigue that has led people to drop their guard, large public gatherings — including weddings, political rallies and religious festivals — and the likely circulation of more contagious new variants.
India is now adding more new cases every day than either Brazil or the US, the two countries hardest hit by the pandemic.
Dr VK Paul, a leading figure in India’s Covid-19 response, noted that the current surge has been far more rapid than last year’s, when much of the country was under a strict lockdown.
“We can still control the pandemic but people’s participation is vital,” he told a press conference. “The next four weeks are going to be very critical. The whole country has to come together to fight the pandemic.”
Doctors in India’s financial capital Mumbai — one of the cities hardest hit by the current wave — have warned that the virus strain circulating in India appears to be triggering earlier onset of aggressive lung disease than in the first wave, when lung problems developed after at least 10 days into the infection.
The trend could put greater strain on the health system than last year, when many hospitals and doctors were pushed close to breaking point.
India has begun a drive to vaccinate those vulnerable to severe disease, and so far has administered 87m vaccine doses, including 3.3m on Tuesday, according to the health ministry.
Indian doctors and state-level politicians are pressing for the vaccination campaign to be opened to those younger than 45 years of age, but New Delhi has ruled out any such move imminently.
Grant Thornton says most UK staff want to stay away from office after pandemic
The vast majority of Grant Thornton’s UK employees want to spend less than half of the working week in the office after the pandemic, according to the accountancy group’s chief executive David Dunckley.
This marks the latest demonstration of the likely lasting effect of lockdowns on working practices, a week after PwC announced its staff would spend between two and three days a week in the office as part of a hybrid model.
The desire to stay away from the office is shared across the workforce irrespective of age, gender, ethnicity, or location, Dunckley said.
A survey of the roughly 4,600 UK employees at Grant Thornton, Britain’s sixth-largest accountant by revenue, found that 88 per cent wanted to spend most of their time working from home.
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Australia calls for EU to release 3.1m vaccine doses
Australia said on Wednesday it would ask the European Union to release 3.1m doses of the Oxford/AstraZeneca Covid-19 vaccine that had been scheduled to arrive in the country by the end of March.
On Tuesday the EU denied blocking shipments to Australia, saying it was AstraZeneca’s responsibility to meet its vaccine delivery commitments.
Australia’s Prime Minister Scott Morrison said that if the EU was indicating its readiness to release shipments, he would again ask for the jabs to be released.
Covid leaves Japan’s restaurants with few appetising options
Noritsugu Saida opened a lavish seafood restaurant on the Yokohama waterfront in late 2019, just in time for his customer base to get quarantined as Covid-19 ripped through their cruise ship, the Diamond Princess.
After a year of pandemic, however, cruise ships pose only a minor problem. Government restrictions make it difficult to run a profitable restaurant in Tokyo, but tough lease terms in Japan’s real estate market make it prohibitively expensive to close them down.
Saida’s predicament demonstrates how Japan’s service industry has borne the economic brunt of the government’s Covid-19 strategy. The sector has neither customers nor adequate compensation for compulsory closures.
The resulting stress on the industry has created cracks in Japan’s famous social solidarity, prompting one large restaurant operator to defy government requests to close and sue the city of Tokyo for violating his rights under the constitution.
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Samsung Electronics' first-quarter profit jumps nearly 45%
Samsung Electronics has projected a near 45 per cent jump in first-quarter profit on strong sales of smartphones and home appliances.
The boost in sales was driven in part by people spending more time at home during the pandemic. The company’s semiconductor earnings were hit, however, by suspended production at its US plant in February.
Analysts expect better earnings in the coming quarters as chip prices are likely to rebound further on robust demand. Smartphone sales could fall back amid stiff competition.
Operating profit at the South Korean technology giant rose 44.19 per cent year on year to Won9.3tn ($8.2bn) in the January-March quarter. It was its highest for the first quarter since 2018 and in line with market estimates. Sales increased 17.5 per cent to Won65tn, according to the company’s preliminary estimates.
Analysts said Samsung’s mobile division showed a stellar performance in the first quarter as it launched its flagship smartphone and mid-priced models about a month earlier than usual. Sales of premium TVs and other high-margin consumer electronics also jumped.
But profits for the company’s semiconductor division were dented by halted production at its Texas factory due to a winter storm in mid-February. The company said the plant’s operations have returned to near normal as of late March. Analysts estimated the losses from the factory shutdown at Won300bn-Won400bn.
Shares of Samsung fell 0.58 per cent to Won85,500 early Wednesday morning while the benchmark Kospi composite index gained 0.23 per cent.
Moderna vaccine begins UK rollout in Wales
The Moderna vaccine will be rolled out for the first time in the UK to residents in west Wales from Wednesday, the Welsh government has announced.
The UK government has ordered 17m doses of the Moderna vaccine, which will be the third to be administered in the UK, since the rollout began in December last year. The vaccine was first approved by the medicines regulator, the Medicines and Healthcare products Regulatory Agency, in January.
The announcement follows growing concern surrounding the possible link between the Oxford/AstraZeneca vaccine and rare blood clots. “I’m delighted we can start the UK rollout of the Moderna vaccine in west Wales today,” Matt Hancock, the health secretary, said.
“The UK government has secured vaccines on behalf of the entire nation and the vaccination programme has shown our country working together at its best.”
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Pakistan economy shows signs of recovery amid third wave
Pakistan’s economic growth is expected to hit 1.3 per cent this year, according to the World Bank’s Pakistan Development Update, released on Tuesday.
Some uncertainty shrouds the forecast, however, given the third wave of the pandemic currently engulfing the country.
Private consumption picked up from July to December 2020, the report says, in part due to the record increase in remittances inflows, social assistance support, the government’s construction package and a return to pre-Covid mobility levels from September.
The reports also says that investment is recovering, with machinery imports and cement sales both recording double-digit growth rates in the same period.
Economic growth in 2022 and 2023 is predicted to strengthen to an average of 2.7 per cent.
WHO: Oxford/AstraZeneca vaccine benefits continue to outweigh risk
Current data indicates that the benefits of the Oxford/AstraZeneca Covid-19 vaccine outweigh the risk of blood clots, the World Health Organization said on Tuesday.
Speaking during the agency’s regular press briefing from Geneva, Dr Rogério Pinto de Sá Gaspar, the WHO’s director for regulation and pre-qualification, said: “What we can say is that the appraisal that we have for the moment, and this is under consideration by the experts, is that the benefit risk assessment for the vaccine is still largely positive.”
He added that “thrombolytic events” are rare and there is currently no evidence suggesting that the benefit-risk assessment for the vaccine needs to be changed.
"And we know from the data coming from countries like the UK and others that the benefits are really important in terms of reduction of the mortality of populations that are being vaccinated," he said.
The WHO’s Global Advisory Committee on Vaccine Safety is due to meet on Wednesday to assess data further, with a conclusion expected later in the week.
Brain disorders affect 1 in 3 Covid survivors, large UK study shows
One in three people who have suffered from Covid-19 was diagnosed with a neurological or psychiatric condition within six months of infection, according to scientists who have carried out the largest study of the mental health effects of coronavirus.
They found that Covid-19 was 44 per cent more likely to cause neurological and mental problems than a case of influenza of comparable severity.
“Although the individual risks for most disorders are small, the effect across the whole population may be substantial for health and social care systems due to the scale of the pandemic and the fact that many of these conditions are chronic,” said Paul Harrison, professor of psychiatry at Oxford university and project leader.
“As a result, healthcare systems need to be resourced to deal with the anticipated need, both within primary and secondary care,” he added.
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Oxford pauses AstraZeneca vaccine study on children
Oxford university has called a pause to a small clinical trial in children of the Covid-19 vaccine developed with AstraZeneca, ahead of new risk assessments this week by regulators investigating possible links between the jab and rare but potentially fatal blood disorders in adults.
The suspension of the trial, which was running tests in 300 volunteers aged 6 to 17, is the latest setback for a product seen as a mainstay of vaccination programmes in the UK and around the world.
The university said it had decided to suspend the trial ahead of the release of “additional information” from the Medicines and Healthcare products Regulatory Agency, the UK regulator, following its review of cases of thrombosis (blood clotting) and thrombocytopenia (low platelet count) in some adults. It said there were “no safety concerns in the paediatric study”.
The MHRA and the European Medicines Agency are both expected to issue new risk assessments this week, following incidents of rare blood disorders in people around Europe who have had the Oxford/AstraZeneca jab.
Read more here
Carnival threatens to move its ships from US ports
Cruise operator Carnival threatened to move its ships abroad after suspending voyages from US ports through to the end of June.
“While we have not made plans to move Carnival Cruise Line ships outside of our US homeports, we may have no choice but to do so in order to resume our operations which have been on ‘pause’ for over a year,” said Christine Duffy, president of Carnival.
Such a shift could deliver a blow to American ports and the small businesses around them.
The Miami-based company, which last year found itself at the centre of the crisis when coronavirus broke out on its Diamond Princess ship, also said all booked guests are being offered credits or a full refund for cruises through to June 30.
Carnival’s decision comes after the Centers for Disease Control and Prevention on Friday provided updated guidance on conditions necessary before sailings can begin, but did not specify a date for resuming cruises.
The US health agency’s latest recommendations include daily reporting of coronavirus infections, implementing routine testing and creating plans to manage outbreaks on ships that need approval from port and local health authorities. The CDC said these guidelines would help cruise companies ready for simulation voyages with volunteers before sailing with passengers.
These additional guidelines were dubbed “unduly burdensome, largely unworkable” by the Cruise Lines International Association (CLIA), an industry group.
The CDC also recommended cruise operators establish a plan and timeline for vaccination of crew and port personnel. However, most cruise industry operations are based in Florida, whose governor, Ron DeSantis, last week banned businesses from requiring proof of inoculations.
California targets full reopening of economy by mid-June
California is targeting fully reopening its economy by mid-June, Governor Gavin Newsom announced on Tuesday.
The state could end its four-tiered system for reopening on June 15, Newsom said, provided two conditions are met, namely that there is sufficient vaccine supply for residents aged 16 and older who wish to be vaccinated and coronavirus hospitalisations rates are stable and low.
The move away from the tiered system would allow all sectors in the most-populous US state to return to usual operations, but with “common-sense public health policies in place”, the governor’s office said in a statement.
“We can now begin planning for our lives post-pandemic. We will need to remain vigilant and continue the practices that got us here – wearing masks and getting vaccinated – but the light at the end of this tunnel has never been brighter,” the governor said.
Asked if he would consider ending the state’s requirement for face coverings, Newsom said “we are not anticipating, in the short-run, lifting that mandate.”
California became one of the hotspots for coronavirus during a winter surge that swept across the US. Owing to record infection rates and dwindling hospital resources, more than 90 per cent of the state's almost 40m residents became subject to stay at home orders as their counties entered the most restrictive "purple" tier in the system for reopening.
Pandemic metrics have improved since then and many parts of the state, including the most populous Los Angeles county, have managed to move to less-restrictive tiers. That has allowed them to reopen non-essential businesses and theme parks and hold sporting events.
Over the past week, California has averaged about 46 new infections per 100,000 people a day, which is among the five lowest per capita case rates in the US, according to data from the Centers for Disease Control and Prevention.
Public health authorities have confirmed 873 cases of the B.1.1.7, the coronavirus variant that was first identified in the UK, in California. That is the fifth-most of any state, behind top-ranked Florida, Michigan, Minnesota and Colorado.
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Texas governor Greg Abbott has issued an executive order prohibiting government-mandated vaccine passports in the state. Abbott, in a statement released on Tuesday morning, said “vaccines are always voluntary and never forced” and that “government should not require any Texan to show proof of vaccination and reveal private health information just to go about their daily lives”.
Mexico is poised to approve a Covid-19 vaccine designed and developed by India, despite Brazil having refused to grant it the regulatory green light. Foreign minister Marcelo Ebrard told a news conference that “Mexico is about to approve … the first Indian-origin vaccine … very soon, this is very important to us”. Mexico has also bought doses of the Oxford/AstraZeneca jab produced in India.
Montana governor Greg Gianforte has tested positive for coronavirus, just days after receiving his first jab. The governor's office said in a statement released late on Monday that Gianforte experienced “mild symptoms” a day earlier and subsequently took a coronavirus test “out of an abundance of caution”.
US job openings climbed to their highest level in two years, signalling labour demand is ramping up as the vaccine rollout quickens and economies continue to reopen. The number of available positions, a gauge of labour demand, rose 268,000 in February — the biggest gain in five years — to 7.37m, according to the Job Openings and Labor Turnover Survey (Jolts) released on Tuesday.
Most advanced economies will emerge from the coronavirus crisis with little lasting damage, thanks to the relatively rapid rollout of vaccines and their willingness to increase public spending and borrowing, according to the IMF. The likely success in managing the economic fallout from the pandemic will not be replicated in emerging economies, however.
Vaccine passports should not be required for international travel, the World Health Organization has said. “We as WHO are saying at this stage we would not like to see the vaccination passport as a requirement for entry or exit because we are not certain at this stage that the vaccine prevents transmission,” said WHO spokesperson Margaret Harris at a United Nations briefing on Tuesday.
The chief executives of British Airways, Virgin Atlantic and Heathrow Airport have called for a travel corridor with the US to be opened as soon as next month, in a push to reopen the industry’s most lucrative routes following more than a year of disruption.
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