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Australia catching up with the corona virus

Last updated on 28 March 2020

by Colin Chapman

Australia has come from behind with a strategy to defeat the deadly coronavirus. 

As might be expected there are mixed messages, and still much to do. It is easy to criticise Scott Morrison and his government. After a late return to Canberra, ministers were still reeling from the nationwide, and deserved, criticism of its handling of the wildfires and so they paid little attention to developments in Wuhan, China. 

The Coalition was not the only government to be caught out by the scale and speed of the spreading pandemic. Most of Europe and the United States, now the epicentres of Covid 19, were slow to act and ignored World Health Organisation advice and the consequences are all too depressing.(WHO)

It’s not that Morrison and his ministers and advisers believed the ridiculous claim of Donald Trump that the coronavirus was a hoax dreamed up by ‘fake’ media to damage his chances of re- election (although some media hacks peddled that view). It was simply that the government had to balance the need to protect the health of the Australian people against the damage to the economy that would result from the shut down of business and services.  At the time of writing the Morrison government was still pondering whether or not to close all non-essential businesses, declining to follow the British example, let alone the draconian policy in France which requires all citizens to fill in a form if they wish to leave home, stating their purpose and destination, with severe penalties for non compliance.

It was always clear that a recession was inevitable but the government wanted to avoid a 1930s style depression. So, like the British, Canberra chose a step-by-step strategy which has now been labelled as ‘too little too late’.  There have been half measures, often different state by state, a ban on foreigners coming to the country, but an ongoing muddle over lockdowns and and freedom of movement. There have been some bizarre actions, like the decision of the NSW Berejiklian government to allow pubs and bottle shops to deliver to customers’ houses and apartments.

In comparison with other countries, however, Australia’s performance has been above average according to statistics for the morning of March 26 (AEST) sourced from Worldometer and provided by the WHO;  the numbers have kept on growing since then. 

The yardstick I have used in the Australian Strategies table are shown yin order of the number of cases per million of population. Those with fewer per head than Australia are listed in order above the line for Australia and those with more cases per million – which are suffering more, are listed below.  

The countries listed are either G20 or OECD nations, with a few others included because of their similarity to Australia either by size of population, or balance of the economy. Readers will immediately note that two of the most populous countries, India and Indonesia, are not included because I suspect their numbers are unreliable, perhaps in part because the epidemic in those countries is at an earlier stage of development, as well as the fact that many cases have not been reported. This logic may also apply to South American countries which are apparently doing well, though it must be said Latin America generally was quick to see what was happening in Italy and Spain, and cracked down much more quickly than  Australia. 

Still, Australia has performed more than 12 times better than the countries at the epicentre of the pandemic: Italy, Switzerland and Spain. While the pictures of coffins stacked up in a Madrid ice rink awaiting cremation are gruesome, the numbers for the health-conscious Swiss are surprisingly high, although the government claims it has carried out the most tests, perhaps enabled by the pharmaceutical corporations tethered there. Switzerland has only 191 deaths, compared with Italy’s 8,215, now more than twice the number of the most populous nation, China. Indeed on a cases per million basis, China has done better than average, better than Australia and much better than Europe and the United States. In the U.S. Trump makes the story up as he goes along, and talks recklessly of having the churches packed full by Easter.(Some deluded Americans appear to believe him, but not the frightened residents of New York and Boston, where the hospitals are overrun). 

In the United Kingdom, where both prime minister Boris Johnson and health secretary Matt Hancock and Prince Charles, Australia’s next monarch, have all tested positive. Britain and Germany remain under pressure. 

CountryNumberDeathsCases per 1mDeaths per 1m
South Africa9270160
Saudi Arabia1,0123290.09
Hong Kong4534600.5
South Korea9,2411311803

Scott Morrison has made some smart moves, like the establishment of a Covid-19 Coordination Commission to anticipate and mitigate the economic and social impacts of the coronavirus. It will be interesting to see how successful this will be.

The issue that will require further analysis is whether the various measures introduced by the Coalition will benefit the Australian people, many of whom face unemployment or serious loss of income. We will have to see, but I suspect that treasurer Josh Frydenberg will be found wanting. One of his plans is to increase immediate tax relief for eligible companies from $30,000 to $150,000, this was later extended to companies with annual turnover of less than $500,000. This, surely, is mindless, and unlikely to create jobs for a government that boasted during last year’s election campaign that it would create “jobs, jobs, jobs”.

Leaving aside the question of how few companies now want to incur debt and make substantial capital investments, it’s hard to think of anything they might buy that would benefit the Australian economy. Certainly not new BMWs for board directors, new air conditioners from Korea, giant American refrigerators, desktop or laptop computers assembled in Asia, or, as mentioned in one of Frydenberg’s press releases, solar panels –  inevitably from China and in short supply.  Utter madness, though perhaps not as daft as president Trump’s attempt to buy votes by mailing a cheque for $1200 to all Americans, whether they need the money or not.

The UK’s new chancellor Rishi Sunak has led the world by introducing a job retention scheme for all employees who have been temporarily laid off because of the coronavirus. They will get paid up to 80 per cent of their pay, to a maximum of £2500 a month. He followed this up this week with a similar package for the country’s five million self employed, enabling those unable to earn because of the restrictions to pay for living essentials for at least three months. Depending on how long the epidemic lasts, his innovative move will enable the economy to sustain itself, though adding billions to the British deficit which will ultimately have to be paid for through taxation. But this move has unified a population deeply divided by Brexit in a way that seemed unimaginable just three months ago.”We will do whatever it takes”, says Sunak.

Will Morrison do what it takes? For a start, I suggest he and Frydenberg spend the weekend reading an essay by former European Central Bank chairman, Mario Draghi. In an article published by the Financial Times, he argues cogently that we face a war against the virus for which we must mobilise on a global scale, an idea also embraced by G20 leaders, including Morrison, on March 26.

Click hereto access the free FT Coronavirus briefing.



Financial Times

ABC News

World Economic Forum

United Nations

OECD Data Charts