By the end of trading on Monday 9 March, the benchmark FTSE-100 index had fallen by 7.7%, wiping £125bn ($160bn) off the value of its constituent companies as fears over the international Covid-19 coronavirus outbreak and a possible global recession grip financial markets.
This was the largest recorded daily fall in the FTSE-100 since 10 October 2008, a fateful day that marked the beginning of the crash of 2008, which greatly affected financial markets. Worrying developments in the financial markets reflect the spread of the coronavirus throughout Europe; particularly concerning is the upsurge in Italy, the European epicentre for the virus with upward of 9,000 confirmed cases and 463 virus-related deaths, as the lockdown extends to the entire country. As the incidence of cases of coronavirus rises across Europe, the UK, the National Health Service (NHS), and Public Health England prepare to tackle Covid-19.
The currently proposed strategy in the UK is based on a four-phase action plan: contain, delay, research, and mitigation. These four strands entail containing the virus, delaying its spread, researching its origins and cure, and finally mitigating the impact of the virus once it has become widespread. This action plan sets out the possible measures which can be deployed depending on the spread of the virus. Currently, the UK is in the “contain” phase, with 319 confirmed cases and four deaths (as of 9 March), but considering the recent spread in Europe and lockdown in Italy, this is expected to transition into the “delay” phase within the next 14 days. The UK government is promoting a scientist-led approach which argues that the timing of interventions is paramount to optimising public adherence to measures, such as imposing travel bans and restrictions. Critically, the government wants to push the peak of the outbreak into summer and flatten the peak number of patients; both are objectives designed to limit the NHS being overwhelmed. Essentially, the NHS is better equipped to deal with the coronavirus if incidence is spread over a longer period (to limit the number of patients at a given time) and once the seasonal burden on the NHS subsides. An expected increase in the number of cases in the next 14 days will prompt official advice for individuals who experience respiratory symptoms or fever to self-isolate to delay the spread of the virus within the UK.
The Prime Minister is under political pressure to adopt a more aggressive approach to contain the spread of the virus as implemented in China and now Italy, namely through restrictions on transport, public gatherings, and school closures. Public Health Experts argue that the UK’s strategy is considered, and different from other countries based on the limited number of current cases of coronavirus in the UK and an emphasis on timely interventions, which will most effectively promote social adherence and limit spread. Notably, Italy was the first European country to impose a flight ban from China, which has evidently not been effective in limiting the spread of the virus in the country. However, bold measures in Wuhan, which involved placing at least 50 million individuals under mandatory quarantine, implementing “social distancing,” electronic surveillance, and the construction of two dedicated hospitals in just over a week, has been recognised as a success by the World Health Organization (WHO). Given the unique political system in China, the country may not be the most appropriate model for the UK. Identifying effective containment strategies in European countries may be a more analogous model while learning from measures in Wuhan—in particular, ensuring increased capacity for the healthcare system—is pertinent.
While it is difficult to speculate on the potential impact of the coronavirus, notable underestimations and overestimations of its likely impact have been commonplace in the media. A comparison to the common flu, with individuals often citing the number of deaths as a result of the flu compared to coronavirus, is obviously flawed due to the far greater number of individuals who contract the flu annually compared to the currently limited prevalence of the coronavirus. However, the mortality rate of 3.4% announced by the WHO does not consider the expected large number of asymptomatic cases in the populace which are not accounted for in the estimated 110,000 global incident cases of coronavirus, inflating the mortality rate of the virus. Inflammatory analogies to “Blitz Britain” in the media also appear to be hyperbolic, considering the perilous state of the nation in 1940. However, the rise of the coronavirus is troubling and the increase in incidence and mortality is certain. The implementation of the UK’s action plan to contain and delay the spread of the coronavirus will be the greatest test for the NHS in recent years.