1st Corona Free Nation Rattles Public Confidence & Economy With New Cases

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  • New Zealand loses its COVID-free status in just eight days.
  • Two women who were permitted to leave quarantine early on compassionate grounds tested positive and a man who flew in via Doha and Melbourne.
  • Health Minister suspended all exemptions to the quarantine rules.
  • New Zealand’s economy shrank 1.6% in the March quarter, the largest drop in 29 years.
  • The contraction was worse than economist forecasts for a 1.0% fall but smaller than the central bank’s projection for a 2.4% drop.
  • All restrictions, except border controls, were lifted last week, but the tough measures brought the economy to a standstill for weeks.
  • The Reserve Bank of New Zealand (RBNZ) is expected to hold interest rates, as it continues with its NZ$60 billion (QE) programme to stimulate the economy.

For New Zealand, it just took eight days to lose its COVID-free status as two women who had been given permission to leave quarantine early after arriving from abroad tested positive for the coronavirus, authorities said on Tuesday, reports Reuters.

Vigorous testing triggered

Inadequate checks

Prime Minister Jacinda Ardern, who gained enormous popularity for her success in making the country free of coronavirus infection, said the government would review what happened. 

For more information read our article [Watch] First Country To Eliminate COVID19 Shows How To Do It!

Ardern added that it was clear that checks were not adequate in the particular case. 

Remotest chance of contact tested

Ardern said in a Facebook Live post that vigorous testing is done across those who were in the quarantine facility at the same time, and those who may have had any, even the remotest chance of contact with the infected women.

Return to pre-pandemic normality

New Zealand had trumpeted its achievement last week of becoming one of the first countries in the world to eliminate COVID-19 and return to pre-pandemic normality, lifting all social and economic restrictions except border controls.

Quarantine for 14 days 

The country mandates a 14 days quarantine for all people arriving from abroad to avoid reintroducing the disease. 

Details on the recent case 

According to the director general of health:

  • The two women aged in their 30s and 40s had travelled from Britain to visit a dying parent in Wellington on June 7.
  • Both had gone into quarantine in Auckland after landing.
  • They had been given special permission to leave on compassionate grounds, even though one had symptoms which she attributed to a pre-existing condition. 
  • They tested positive after they returned to quarantine.

The new cases ended a 24-day streak of no new infections in the country.

Other’s who were tested 

  • One family member of the women has been isolated in Wellington. 
  • Staff at the hotel they women lived in would be tested. 
  • Co-passengers on their flight, staff at Auckland airport and anyone else whom the women met would be contacted.

Deaths from the disease remain at 22, among the lowest in the developed world.

Exemptions to the quarantine rules 

Health Minister David Clark said he was suspending all exemptions to the quarantine rules until he had confidence in the system.

“Compassionate exemptions should be rare and rigorous and it appears that this case did not include the checks that we expected to be happening. That’s not acceptable.”

New Zealand’s border is closed to everyone except returning citizens though some exceptions have been made for business and compassionate reasons. Everyone has to go into quarantine.

Public confidence undermined 

New Zealand recorded on Thursday its third new case of the coronavirus this week. The new case is a man in his 60s who flew in from Lahore in Pakistan, via Doha and Melbourne on June 11, and is in quarantine.

Contact tracing is underway for the hundreds of people who may have come into contact with the three new cases.

Director General of Health Ashley Bloomfield said he was convinced there had been no community transmission linked to the new cases.

New Zealand’s economy 

Added to undermined public confidence due to quarantine breaches and other failures , New Zealand’s economy shrinks by the most in three decades.

  • New Zealand’s economy shrank 1.6% in the March quarter, the largest drop in 29 years.
  • The first quarterly fall since the December 2010, as the initial effects of coronavirus curbs paralysed activity.

The contraction was worse than economist forecasts for a 1.0% fall but smaller than the central bank’s projection for a 2.4% drop.

Finance Minister Grant Robertson said the decline is expected to have deepened in the current quarter due to the tighter restrictions seen in April and May.

Technical recession?

That would put New Zealand in its first technical recession, defined as two straight quarters of contraction, since 2010, although a recent easing in curbs is expected to aid a recovery in the second half.

COVID Response and Recovery Fund

Robertson said, “Now, our focus is on protecting jobs and supporting the economy to recover and rebuild through the investments made in Budget 2020 and by the COVID Response and Recovery Fund.”

“By opening up the economy quicker than forecast, we’ve got a head start on our recovery.”

Post-lockdown bounce 

The 1.6% decline was the largest quarterly fall since the March quarter of 1991.

Annual production-based GDP fell 0.2% compared to a 0.3% rise forecast in the Reuters poll.

Economists have warned the data may not fully capture the extent of the economic impact of lockdowns designed to limit the spread of the coronavirus, which were only enforced toward the end of the first quarter.

ANZ Senior Economist Liz Kendall said, “We are currently seeing a post-lockdown bounce in activity but the longer-lasting recessionary effects of this crisis will be determined by where the trend settles after that. For now, there is a lot of noise to wade through.”

Industries contribution

All restrictions, except border controls, were lifted last week, but the tough measures brought the economy to a standstill for weeks.

Service industries contributed the most to the drop in activity, while the construction industry and household consumption expenditure also fell.

The Reserve Bank of New Zealand (RBNZ) is widely expected to hold interest rates at its meeting on June 24, as it continues with its NZ$60 billion ($39 billion) quantitative easing (QE) programme to stimulate the economy.

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Source: Reuters

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