What Does Coronavirus Lockdown Mean for People Living Abroad?
A year into the coronavirus pandemic, countries are continuing to reimpose national lockdowns as a third wave of infections spreads across Europe. France recently announced that it would undergo a four week lockdown, with Italy and Germany also extending restrictions in an attempt to stop the further spread of Covid-19. Here we examine what exactly coronavirus lockdowns mean for people living abroad and the impact this will have on currency markets.
What is a Coronavirus lockdown?
A coronavirus lockdown is where a country prohibits the population from leaving the area in a bid to prevent the spread of the virus. Equally, the protocol also prevents people from entering the country. Countries such as Italy and France have been ordered not to leave their homes in a bid to help contain the virus. They can buy food, visit hospitals and banks but are advised to stay indoors whenever possible.
Whilst lockdowns do appear to help contain the spread of the disease, business closures and lack of public spending has a significant impact on economies. Some people are sceptical towards lockdowns, believing exposure to the virus can help countries reach herd immunity. At the start of the coronavirus pandemic, Italy was the worst affected country after China. Since going on lockdown, infections continued to rise, mainly because people continued to go out regardless of the lockdown procedures in place.
Coronavirus lockdown impact on travel
The coronavirus lockdown had a huge impact on travel with UK travel and aviation companies such as TUI and Jet2, suspending holidays and flights. There were instances where UK flights had to turn around mid-air as news of the lockdown broke.
Coronavirus is also having a huge impact on employment within the travel industry. Virgin Atlantic initially told all staff at the start of the pandemic to take 8 weeks of unpaid leave after revealing that they would cut 80% of their flights each day. The company stated that this is the only way in which they can reduce their outgoings without having to make any job cuts. However, the airline went on to cut 3,500 jobs out of their 10,000 employees last year before announcing a further 1,150 job losses in September 2020.
The travel and aviation industry have undoubtedly been one of the hardest hit sectors along with the hospitality industry over the past year. It seems that hope is on the horizon for the UK travel abroad, however, as UK Prime Minister Boris Johnson has revealed plans for a traffic light system that would allow travel to low risk ‘green’ countries with low infection rates. With coronavirus cases in the UK on the decline in the UK, it seems that travel abroad could be on track to continue the target date of 17th May.
Coronavirus lockdown effects of people living abroad
During a global health crisis, individuals living abroad may be wondering if it is best to return to their home country. This could potentially be impractical and even impossible, depending on where you live. At this stage, the country you live in determines what your options are. In Spain, for example, there are over 300,000 UK expats, where it was initially confirmed that their lockdown would last for a period of 2 weeks. The lockdown meant that many expats and tourists were unable to return to the UK. With everyone being confined to their home, the only time it was permitted to go outside was for necessities. For situations such as this, it is best to follow the advice given to you by the government until there is an improvement in the situation and further instructions are given.
How can coronavirus lockdown affect the plans of people moving to countries?
Many people in the UK dream of retiring overseas but the coronavirus outbreak could temporarily stop your plans in their tracks. Travel advice by the Foreign & Commonwealth Office is continuously under review. As it stands, they are advising against all travel unless ‘essential’ and a declaration for will need to be completed. Obviously, what is deemed as essential travel will vary from person to person. It may be because of a family issue or business matter. Regardless, it is best to look at the government website to stay updated regarding travel plans. As the coronavirus situation is constantly evolving, the advice is likely to keep quickly changing.
Coronavirus Lockdown effects on currency markets
world’s currency markets. Since the initial European lockdowns, both European and Asian stocks have fallen as central banks, including the Bank of England, began slashing interest rates. The FTSE 100 plummeted below the 5,000 mark for the first time since the 2011 financial crisis. Economists warned that we should all prepare for a global recession, what with the concoction of travel bans, lockdowns and lack of mass gatherings.
Whilst many countries are still under significant economic pressure, the overall global economic outlook is improving as a result of coronavirus vaccines. The International Monetary Fund (IMF) has predicted that the global economy will grow by 5.5% in 2021 and 4.2% in 2022.
When will coronavirus restrictions be lifted in the UK?
The UK is currently in the midst of its third coronavirus lockdown, though restrictions are gradually easing in line with Boris Johnson’s roadmap plan, with the PM labelling coronavirus as ‘the worst public health crisis for a generation’. As of 13th April 2021, new daily coronavirus cases stood at 2,471, a significant decline from January’s figures where daily cases averaged at over 50,000.
The next stage of the easing of the UK’s lockdown will be 17th May which will see travel abroad potentially permitted as well as pubs and restaurants serving customers indoors.
If daily coronavirus cases continue to fall, it is likely that the UK could see a full lifting of restrictions on 21st June.