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Situation Update - Coronavirus Outbreak

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US IMPOSES TRAVEL RESTRICTIONS ON ARRIVALS FROM SCHENGEN COUNTRIES FOLLOWING PANDEMIC DECLARATION

  • World Health Organization confirms the COVID-19 outbreak is a pandemic

  • US President proclaims travel restrictions for arrivals from Schengen countries

  • US State Department issues worldwide Level 3 warning recommending citizens reconsider travel abroad

  • Delta Air Lines issues travel waiver covering flights between the US and Europe

  • Italy tightens nationwide lockdown measures

  • European Union promises to do 'whatever it takes' to tackle spread of the virus

  • The White House proposes economic relief measures to Congress; details yet to be confirmed

  • Global confirmed cases exceed 126,600 cases, with 4,641 total deaths

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Situation

On Wednesday, 11 March, US President Donald Trump announced plans to restrict travel for most foreign nationals to the US from the 26 countries of the Schengen Area, starting 23:59 EDT Friday (13 March), for 30 days, if they have travelled to these locations within 14-days of their arrival to the United States. 

Countries that form the Schengen Area include Austria, Belgium, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Iceland, Italy, Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, Netherlands, Norway, Poland, Portugal, Slovakia, Slovenia, Spain, Sweden and Switzerland.

The US administration has already restricted travel from China and Iran. 

The restrictions do not apply to American residents or to travel from the United Kingdom (UK). Most immediate family members of US citizens are also exempt. Furthermore, the White House clarified that the travel restrictions would not apply to goods and cargo coming from the EU. 

According to the Department of Homeland Security, returning US passengers currently in parts of Europe will need to "travel through select airports” where the U.S. Government has implemented enhanced screening procedures. Exact airports have not yet been confirmed, however Vice-President Pence has said that those returning will be asked to voluntarily quarantine for 14 days, whether they have symptoms or not. 

In response, major US airlines have confirmed they will implement the policies, adjusting services accordingly. Delta Air Lines have announced a travel waiver for passengers traveling to, from or through Europe and the UK through 31 May. The waiver applies to travellers who purchased tickets before 11 March.

The State Department has also issued a global Level 3 warning that recommends US citizens reconsider all travel abroad, “even countries, jurisdictions, or areas where cases have not been reported may restrict travel without notice.” 

The announcement follows the World Health Organization’s pandemic declaration for COVID-19 and a recent spike in the US, with over 1,000 confirmed cases. As of 12 March, globally, there are in excess of 126,600 cases, with 4,641 total deaths. 

In Europe, Italy has further expanded its nationwide lockdown to include the closure of all shops, except food stores and pharmacies, as well as bars, restaurants, hairdressers and non-essential company departments, until 25 March. The country has already closed schools, gyms, museums, nightclubs and other venues across the country. Italy has recorded more than 12,000 confirmed cases and a death toll of 827. 

Other European countries that are experiencing COVID-19 outbreaks include France with confirmed 2,284 cases, Spain 2,968, Germany 2,078, and 652 in Switzerland. The UK, which is not subject to the US restrictions, has confirmed 459 cases.

Analysis

The televised statement by President Trump was followed by the release of The White House proclamation, highlighting several inaccuracies in the speech by the President, requiring clarifications to be released by officials. Most notably that the travel restrictions would not apply to goods and cargo coming from the EU. However, many details remain unclear, raising questions about whether the response is the most effective to address the situation.

A recent study published in the peer-reviewed journal Science found that the effectiveness of travel restrictions in China was limited once the disease had spread widely within the country. The Wuhan travel ban only delayed the progression of the outbreak by three to five days. There has also been criticism in the US of the reported shortage in testing kits.

While the order is short of a flight ban, and with the UK being exempt, there have been many questions about the possibilities for connecting flights to continental Europe. However, the acting secretary of the Department of Homeland Security has said that further guidance on the travel suspension will come within the next two days. Ultimately, the measures would likely further diminish demand for such flights, prompting more flight cuts, both internationally and domestically.

Since late January, US airlines began suspending and reducing international flights, repeatedly adding new suspensions to varying destinations. On 10 March, United Airlines said bookings to Europe were down 50%, and that it intended to cut its domestic seat capacity by 10% in April and May. American Airlines said it is reducing international seat capacity by 10% this summer, including a 55% reduction in flights across the Pacific. Flights within the US will be reduced by 7.5% for the month of April.

Such sweeping changes, and with an apparent disregard for consultations with the European Union, are expected to have a wider reaching economic impact. In Europe, travel sector stocks lost almost 10% Thursday morning (12 March), with airline stocks among those leading the losses.

Despite the US president’s proclamation, the current risk assessment from the Centers for Disease Control and Prevention (CDC) is that the for the majority of people, the immediate risk of being exposed to the virus that causes COVID-19 is thought to be low. There is not currently widespread circulation in most communities in the US; however, more cases of COVID-19 are likely to be identified in the coming days, including more instances of community spread.

Implications

Reduced demand for flights will ultimately prompt cuts in available services. Previously, there were reports of multiple so-called ‘ghost’ flights due to airlines having to maintain services to keep airport slots; however, the European Commission has suspended airport slots rules, which will further incentivise carriers to cut flights to/from or within Europe.

There is also an elevated risk that certain airports or terminals will close. This was evidenced by the decision on Thursday by Italian officials to shut the passenger terminal at Rome Ciampino Giovan Battista Pastine Airport from 14 March, and Terminal 1 at Leonardo da Vinci International Airport from 17 March.

The announcement by President Trump will likely raise the number of cancellations for US bound international and domestic routes, as passengers cancel or re-book flights out of concern that they could either become stranded or because of a perceived risk of infection.

Following the news of the US ban, there have been reports of further decreases in the financial markets. The UK’s Chancellor has acknowledged that the move will have a knock-on impact to the British economy. Moreover, with the UK exempt, if there is an uptick in travellers moving between banned countries and the UK for flights to the US and elsewhere, this would place additional strain on the UKs critical national infrastructure, including health provisions. Whether reciprocal travel bans will be introduced remains unclear; however, the sweeping US changes are not an isolated case, with similar travel restrictions imposed elsewhere globally. For example, Saudi Arabia has announced it is temporarily suspending flights with the European Union and additional countries due to fears of the coronavirus. This includes Switzerland, India, Pakistan, Sri Lanka, Philippines, Sudan, Ethiopia, South Sudan, Eritrea, Kenya, Djibouti, and Somalia. The Dubai Health Authority has announced that all travellers arriving from China, Hong Kong, Italy, Iran, South Korea, Japan, Germany, Singapore, and France will be subject to a mandatory 14-day self-quarantine upon arrival in the country due to the ongoing coronavirus (COVID-19) outbreak.

As of 11 March, India announced, from 12:00 GMT on 13 March, all existing visas (except diplomatic, official, UN/International Organizations, employment, project visas) would be suspended until 15 April 2020. However, visas of all foreigners already in India remain valid. In China, Beijing city officials confirmed on 11 March that all international arrivals into Beijing will be required to undergo a two-week quarantine due to coronavirus concerns.

Other travel restrictions including the cancellation of mass gatherings are also expected, as well as the closure of education facilities including schools and universities.

Although President Trump said his administration would work with the airlines, it is not yet clear what type of assistance will be provided, and for how long. In addition to flight reductions, airlines could invoke clauses in aircraft contracts to allow them to cancel or defer airplane orders, while they can also offer or order more unpaid employee leave.

The WHO pandemic declaration and the move from the US may accelerate further nations to implement similar restrictions, limiting alternative or onward travel plans. As long as cargo and freight movements remain unaffected, supplies in stores - that have been depleted to date - should be able to re-stock, although manufactured products may still have some limited availability, if producers’ close factories.