The coronavirus outbreak is having a dramatic effect in Europe. Here are the latest developments, and the potential sources of hope amidst the terrifying gloom.
Amazingly, wartime cheerleading songstress Vera Lynn is still alive at 102 and has been asking Brits to chin up and invoke the Blitz spirit to struggle through the viral nightmare. The right wing in Britain is particularly fond of drawing a parallel. But unfortunately this analogy doesn’t go very far.
Industry is grinding to a halt
For starters, German industry has largely halted. Entire plants have closed. Germany’s demand for electricity is on a trendline leading to a drop of 50 to 120 million tons fewer CO2 emissions this year, thereby exceeding its climate target, based on a 4.5 to 8.7 percent GDP drop.
What’s more, improvements in air quality are being seen everywhere that is on lockdown. That’s good, right? However, there is concern that these environmentally beneficial curve-downs will reverse when governments, desperate to kick-start their economies to pay back the massive debts being racked up to tackle the pandemic, throttle up on all types of power generation later in the year.
How will it affect climate change?
UN Secretary General Antonio Guterres has slapped down naive optimism about silver linings this week in reference to sharply falling emissions projections by saying, “we will not fight climate change with a virus”.
And, to paraphrase Churchill, we won’t fight either on the beaches. Environmentalists are therefore calling for a massive rethink on measures to tackle both an economic renaissance and the climate emergency.
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Some see some hope in the crisis. Dr María Mendiluce, interim chief executive of the We Mean Business Coalition, a global nonprofit helping businesses to take action on climate change, says the crisis shows that “families, businesses and governments have the power to act radically and decisively when the moment calls for it” and “just how fragile our way of life is”.
Therefore, she continues, we must “build greater resilience, and to finally tackle the biggest threat to our existence… to ensure that public spending helps address both the current economic crisis and the ongoing climate crisis and take a decisive turn on the road to a resilient, zero-carbon future”.
You know it’s bad when McDonald’s closes all of its 1270 restaurants in the UK, which it did yesterday. They didn’t even introduce rationing – perhaps they hadn’t heard of the Blitz spirit. But solar firms are being hit too, as equipment manufacturing countries under lockdown – China, Malaysia, Vietnam, Singapore, Thailand and South Korea – have shrunk operations, creating a shortage of construction items used to make solar panels and systems.
Staying with the power sector, despite the fact that oil prices have fallen for four weeks and are now 60 per cent lower than January 1st, demand is also falling. Reuters records that: “Prices of everything from coal to copper have also been hit by the crisis, while markets in bonds and stocks enter rarely charted territory…Many oil companies have rushed to cut spending.”
Coal and oil companies are therefore joining airlines in seeking government bail-outs – calls being heeded by President Trump – an irony not lost on many. CarbonBrief is reporting on how the twin Covid-19 and climate change disaster threats could break many countries’ – including the US – abilities to support their industries. They may have to choose between fighting climate change and supporting fossil-fuel industries.
Construction industry fall-out
Most people in industry, are obviously caught up with the short-term. The construction industry is contemplating closing sites and parking up cranes as the prime minister is poised to announce measures to enforce social distancing, although they are unlikely to be as severe as in Austria where the police have already fined 650 people up to €3600 each for not respecting restrictions.
The director of one contractor has commented on the prospect of closures: “There’s risks with banks and funders. I think what is needed is joint action from clients and contractors. If we can’t drop our industry’s adversarial attitude at a time like this, then we never will.”
Simon Tolson, a senior partner at law firm Fenwick Elliott, said: “Not many jobs can seriously vouch for labour being two metres apart – lifts, hoists, laydown areas, mess areas, welfare, turnstiles.” Another law firm is offering advice to companies on the legal implications of the pandemic’s effect on their ability to fulfil contractual obligations.
Other countries may well follow New York City, which is expected to suspend all non-essential construction – including in healthcare, public infrastructure, transport and social housing – on the advice of its Public Advocate, Jumaane Williams.
The British response
To address the economic fallout, the British government is promising to make up 80 per cent of all lost wages, and has told public sector clients to pay bills promptly, ditch time-consuming procurement methods such as frameworks, and make contract awards as speedily as possible.
Framework fees will be waived for any projects procured via the government’s frameworks using the government’s procurement policy note, which explains what procurement options are available to the public sector in light of the current circumstances.
The pandemic may mean that the COP26 climate summit planned for Glasgow in November might be delayed, UK foreign secretary Dominic Raab has warned. “We haven’t got to the stage where I can tell you we have given up on it. We are still hoping we can deliver on it. I think we are all waiting to see right now quite what the timing is going to be on the coronavirus,” he said.
House prices threat
The Royal Institution of Chartered Surveyors is offering vacant properties for NHS workers caught in households where members have tested positive for the virus so that they can carry on working.
House prices might be affected. While they were almost at an all-time high at the end of February, and the construction sector estimated to have been experiencing growth, this is expected to stop.
“The market has been waiting for several years for a window of certainty, and 2020 seemed set to be the year when many would look to make a move. However, the current fast pace of the housing market could now be temporarily affected by the spread of the Covid-19 coronavirus,” said the director of estate agent Rightmove, Miles Shipside, a view echoed by Andrew Burrell, from research firm Capital Economics, who said it was likely to be temporary however.
Cross-border freight hold-ups
The European cross-border lockdown measures introduced to slow down the spread of the virus “have also slowed down and sometimes paralysed transport,” said European Commission President Ursula von der Leyen, so the European Commission has asked all member states to set up dedicated freight channels at international frontiers along the bloc’s trans-European transport network.
These so-called green lanes should be open to all hauliers no matter what freight they are carrying and border crossings should take a maximum of 15 minutes.
Yes, it is a war, and we are heading into the unknown, and our responses now will determine our welfare in the future. Unlike the second world war, we’re learning that we’re all in it together, everyone on the planet, and we’re learning how to co-operate better for the greater good.
That, at least, is giving many a source of hope in these truly frightening times.
David Thorpe is author of the books Solar Technology and the new One Planet Cities. He also runs on line courses such as Post-Graduate Certificate in One Planet Governance. He is based in the UK.