Travel bans imposed in Europe over new Brazil COVID variant
- Travel firms reporting an uptick in holiday bookings from over-50s
- Europe reports a spike in English variant of COVID-19
- UK imposes travel ban on South America and Portugal due to new Brazilian COVID variant
- Pound Sterling (GBP) trading on a softer note due to mixed UK economic data
FTSE-listed international travel and tourism company, TUI has reported an increase in summer holiday bookings from over-50s into 2021, which they believe has been triggered by the COVID-19 vaccine confidence.
TUI’s Managing Director, Andrew Flintham, also noted that Brits are opting for 10, 11 and 14-night getaways instead of 7 “to make up for holidays missed in 2020.”
While the Foreign Office warns against all non-essential travel from the UK, many Brits hope that the government will lift travel bans and broaden the travel corridor list as more people receive the COVID-19 vaccine.
According to the latest figures, approximately 3 million Britons have been vaccinated against the coronavirus. Once the UK’s four priority groups have been immunised, COVID-related deaths are expected to decline by 88%, which is buoying hopes for international travel in 2021.
However, many countries could maintain travel restrictions and travel bans against the UK, especially given that the mutant variant seen in the country is beginning to seep into other countries.
Europe expresses concern over the spread of the “English variant”
The EU has warned that the highly contagious British variant of COVID-19 is now having a significant impact in Europe, with countries such as France and Spain reporting an increase in the infectious mutation.
Spain has now extended its travel ban against the UK until February after seeing people who had no link to the UK tested positive for the mutant strain.
French doctor, Jean-Philippe Dancoine, said he doesn’t believe “people are fully aware yet of the danger the English variant poses.”
He also expressed his disappointment over the UK’s lax attitude over measures to contain the virus during the festive period, which led to an exponential increase in cases across the country.
Mr Dancoine added: “The behaviour of British citizens has not always been exemplary, perhaps because of their leaders. Here, we are forced to wear a mask – to take measures.”
Although the UK’s COVID-19 infection rate surged into 2021, the country is now turning the tide on the virus.
A new ZOE Covid Symptom Study UK Infection study revealed that there had been a decrease in daily symptomatic cases by 20%. At the same time, experts at Cambridge University said the R rate has fallen below 1.
However, new concerns are mounting over an emerging Brazilian COVID variant, which is believed to have the capability of re-infecting people who have already fought off the virus.
UK imposes travel ban on Brazil and Portugal over new mutant strain
The British government has prohibited travel between the UK and the whole of South America, Portugal, Panama and Cape Verde due to a new variation of COVID that scientists say could re-infect people who have previously had the virus.
British virologist and head of G2P-UK National Virology Consortium, Wendy Barclay noted that there are two different Brazilian mutations, “one of which has not been detected but is being traced carefully.”
While the origin of the new mutant strain is believed to have come from Brazil, Transport Secretary, Grant Shapps said the decision to ban travel between South America, Portugal and Cape Verde was taken as those countries have strong travel links with Brazil.
News of the new and more dangerous Brazilian COVID variant comes as an additional 1,248 coronavirus-induced deaths are reported in the UK, and 48,682 positive cases.
Although the UK appears to be on track to achieving its COVID vaccine target, with more than three million Brits having now received a jab, the new more contagious Brazilian strain is making investors nervous.
As a result, pound Sterling (GBP) is trading on a softer note on Friday, with mixed economic data releases, including November gross domestic product (GDP) and industrial production figures also weighing on sentiment.
Pound Sterling’s rally runs out of steam
After registering six consecutive days of gains, the British pound to euro (GBP/EUR) exchange rate is trading 0.1% lower at EUR 1.1241, while the British pound to US dollar (GBP/USD) exchange rate has plummeted by 0.4% to USD 1.3622.
The British pounds (GBP) upside potential is being limited by adverse coronavirus developments, which have triggered some flight-to-safety behaviour in currency markets.
Investors are also mulling over recent UK economic data, with industrial and manufacturing figures for November coming in weaker-than-expected at -0.1% and 0.7% versus the expected 0.5% and 0.9%.
Meanwhile, the Office for National Statistics (ONS) revealed that the economy contracted by 2.6% in November – which was when the UK was subjected to a second national lockdown.
While the decline was not as severe as feared, as preliminary readings had forecast a contraction of -5.7%, the UK economy is still at risk of a double-dip recession.
Away from the economic calendar, The media has reported that Chancellor Rishi Sunak has refused to extend the stamp duty holiday, which could bring the UK’s housing market boom to a halt and cost GBP collateral damage.
Mr Sunak has faced mounting pressure from estate agents and industry professionals to extend the stamp duty break, warning that its termination could cause the property market to lose a third of house sales in 2021.
However, the Treasury is reluctant to extend the tax break, which has already cost taxpayers an estimated GBP 3.3 million.
When asked to comment on tax changes, the Chancellor said Britons would have to wait until the Budget announcement on March 3rd 2021.
That said, it’s not all bad news, today as tens of thousands of small and medium-sized enterprises (SMEs) have won a lengthy battle against insurance firms who had refused to cover their losses from the first national lockdown.
The Supreme Court ruled in favour of SMEs receiving COVID insurance cases, ordering insurance companies to pay small businesses cash lost due to the Coronavirus pandemic.
While this ruling could cost the insurance sector GBP 1.2BN, for many SMEs, it will be the difference between them closing and remaining open post-COVID.
