COVID-19 Second Wave Nixes Predicted Economic Rebound

Data released by the European Center for Disease Prevention and Control (ECDC) last week revealed a disturbing COVID-19 trend. The center’s numbers showed five countries in the bloc having more than 120 confirmed cases per 100,000 inhabitants in the last 14 days. At the top of the list was Spain, followed by France, the Czech Republic, Croatia, and Romania. Economies shattered by the first wave, now seem on the verge of a double-dip recession.

According to news from AP, COVID-19 has killed at least 30,000 people in Spain since the start of the outbreak. In the Czech Republic, Health Minister Adam Vojtech resigned Monday because of a record rise of coronavirus infections. In Greece, despite record numbers of new COVID-19 cases, authorities warn of a new lockdown, while inviting more tourist to visit at the same time.

Across the EU, the incongruity and the unknowns have caused a kind of chaos. Children have been forced to attend school, even though the gravity and magnitude of this second wave are yet to be understood. The current situation map below from ECDC reveals the 14-day COVID-19 case notification rate per 100 000, weeks 37-38.

In France, the government is racing to establish new testing centers as cases there skyrocketed to 13,000 new cases in 24 hours. Two days ago Romania reported a new 24-hour record for the number of new cases. And in Croatia, a Zagreb Pride March took place recently despite the country’s growing reputation for not caring about flattening the COVID-19 curve. Yesterday, the UK and France recorded the highest number of new cases since the start of the pandemic.

The EU’s health commissioner has said that in “some member states, the situation is now even worse than during the peak in March.” Here in Greece, the EU country with the best record at flattening the curve in Spring, the government is on the verge of another lockdown if the rise in new cases is not contained. Math models developed to predict COVID-19 trends do not bode well for France, Spain, and most eastern European countries. Even Germany’s baseline predicted curve shows an uptick continuing to the horizon of the math models. The data from Greece and Italy projections below is telling.

A predicted rebound for European economies seems unlikely now that the second wave of COVID-19 has hit. Carsten Brzeski, a chief economist at ING, told CNBC Wednesday:

“The likelihood of a double-dip, i.e. another contraction in the fourth quarter, has increased significantly.”

The eurozone saw its economy sink by 11.8% in the second quarter of 2020 on account of strict lockdown measures used to contain the spread of the virus. Economists fear a second lockdown may cause the business sector to crumble. Tourism being the hardest hit in many countries, may not recover for years if COVID-19 is not contained, or if a vaccine is not discovered soon.

To learn more, readers should check the most recent situational updates from the ECDC here.

Feature image: Courtesy Marco Verch CC 2.0