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Covid-19 and Government Recovery Plans

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Covid-19 and Government Recovery Plans

Governments are seeking to find the right balance between equitably stimulating business and placing the economy on a sustainable footing. Amid all this, while health concerns and the feared ‘second wave’ pervade, disparities remain in how different jurisdictions are delivering an exit strategy. As businesses and markets react to a global state of flux our Public Policy Teams in London, Dublin, Brussels, Berlin, UAE, Saudi Arabia and Johannesburg are helping clients navigate Government recovery plans and below is a snapshot of these plans. Should you wish to explore further or need advice on how to navigate these systems, please do get in touch. Contact:  lucy.cronin@instinctif.com

Public-Policy_COVID19-Newsletter-dividers_UK

Exit strategy for business

  • In a week where the UK began implementing quarantine rules on most arrivals, industry bodies have again pushed the government to allow “travel corridor” deals with other countries. They want to know when and how ministers will agree deals with other countries so more people would be exempt from new quarantine rules for people arriving into the UK.
  • Outdoor attractions such as zoos, safari parks and drive-in cinemas will be allowed to reopen from 15 June, on the condition that social distancing measures are in place. It comes as major retailers John Lewis, Footlocker and H&M prepare to re-open some of their stores next week.
  • In a move that has prompted mixed reactions, the Government has confirmed that its plan for all primary school years in England to go back to school before the end of term is to be dropped. While the Opposition and teaching unions have welcomed the move, a large number of MPs and social commentators are concerned at the impact this will have on children’s education, particularly those who believe the failure to re-open schools could undo years of progress on social mobility.

Stimulus and economic measures

  • The Treasury has confirmed that parents who return to work following statutory maternity and paternity leave will be eligible for the furlough scheme after 10 June.
  • The Treasury has announced that almost £38 million of support is being made available to debt advice providers who have been assisting people effected by COVID-19. The Money and Pensions Service (MaPS), will oversee the allocation of the funds.
  • The Prime Minister is expected to outline plans to accelerate major infrastructure projects including pledges to build 40 new hospitals and key road upgrades. Johnson is also said to want to fast-track recruitment campaigns for doctors and nurses to increase the NHS’s resilience before the winter.
  • Reports suggest Chancellor Rishi Sunak is delaying his Emergency Budget Statement from July to the autumn because he wants to wait until the problems facing the economy are clear before making irreversible spending commitments.
  • Treasury is understood to be considering an economic update in July that could include a limited package of measures. The Chancellor is expected to bring forward announcements of capital projects he wants to invest in.

Public-Policy_COVID19-Newsletter-dividers_EU

Exit strategy for business

  • EU Member States’ Home Affairs ministers have agreed on reopening internal borders within the Schengen area by the end of June at the latest.
  • Ministers also discussed the possibility of gradually reopening the EU’s external borders in July. The Commission has requested that Member States extend current restrictions on non-essential travel outside the Union at least until 15 July.
  • The EU Commission launched ‘Re-open EU’, which provides essential information aimed at facilitating tourism and cross-border travel within the EU. The platform will provide real-time information on borders, transport routes, travel restrictions, public health and safety measures.

Stimulus and economic measures

  • The Commission has awarded nearly €166 million, via the European Innovation Council (EIC) Accelerator Pilot, to businesses.
  • A further €148 million will be granted to companies set to contribute to the recovery plan for Europe, bringing the total investment from Horizon 2020, the EU’s research and innovation programme, to €314 million.

Public-Policy_COVID19-Newsletter-dividers_Germany

Exit strategy for business

  • The German government is lifting its travel warning for EU Member States and some other European states as of 15 June. For countries outside of Europe, the travel warning will continue for the time being.
  • The federal and state governments have announced further easing of measures and it is up to the federal states to decide on the specific measures they will adopt.
  • Nationwide, the contact restrictions will remain in place until 29 June, as well as social distancing and hygiene measures. All shops are to open regardless of the sector, while major events are prohibited until 31 August.

Stimulus and economic measures

  • Germany has adopted measures in order to provide better protection against the insolvency of tour operators. All costs related to the insolvency will now be covered by a fund financed by the tour operators.
  • Germany has decided that farmers in Germany can still employ foreign harvest workers during the pandemic. Seasonal workers from the EU member states and the associated Schengen states can enter Germany without the previous restrictions.

 Public-Policy_COVID19-Newsletter-dividers_Ireland

Exit strategy for business

  • The Department of Business, Enterprise and Innovation has launched The Return to Work Safely Protocol which helps businesses and workers return to work safely.
  • The Irish Government has confirmed the easing of restrictions brought in to contain the spread of Covid-19 has been accelerated with what has been termed “Phase 2”.
  • Phase 2 includes: travel within your own county, and up to 20 kilometres from your home if crossing county boundaries. Businesses and shops have reopened under social distancing guidelines and plans for larger shopping centres and outlets are in place to re-open from next week. Hotels, restaurants, and bars are also preparing to reopen by the end of the month, as Ireland seeks to take advantage of its strong domestic market.
  • All non-essential overseas travel to and from Ireland should still be avoided and passengers arriving from overseas are expected to self-isolate for 14 days.

Stimulus and economic measures

  • The Department of Transport, Tourism and Sport announced a new expert taskforce, to examine what needs to be done to get Irish aviation back up and working again as a driver of economic recovery.
  • The Department of Business, Enterprise and Innovation has announced The Covid Products Scheme. This will accelerate the production of vital medicines, potential vaccines and essential medical equipment. The scheme allows for grant aid of up to 50% of eligible capital investment.
  • The Department of Business, Enterprise and Innovation and the Department of Communications, Climate Action and Environment announced a €14.2m expansion of the Trading Online Voucher Scheme for Businesses.

Public-Policy_COVID19-Newsletter-dividers_KSA

Exit strategy for business

  • Authorities in Saudi Arabia have re-imposed some restrictions as part of efforts to keep the coronavirus pandemic at bay in the city of Jeddah the new measures including restricting movement and halting workplace attendance for employees in both the private and public sector and prohibiting dining in all restaurants and cafes.
  • Five airports in Saudi Arabia are now operating domestic flights as part of the Kingdom’s plan for a gradual return to normal life.
  • Saudi Arabia has begun operating repatriation flights to send stranded employees home.
  • Saudi Arabia is considering drastically limiting numbers at the annual Haj pilgrimage to prevent a further outbreak of coronavirus.

Stimulus and economic measures

  • The Saudi Arabian Monetary Authority (SAMA), the central bank of Saudi Arabia, will be injecting SAR 50 billion ($13.33 billion) into the banking sector.
  • Saudi Arabia’s cabinet recently approved a new mining law that aims to accelerate foreign investment in the sector.

Public-Policy_COVID19-Newsletter-dividers_SA

Exit strategy for business

  • The South African Government have announced that universities can decide for themselves which students can return to class under lockdown level 3 – as long as they stick to government guidelines on numbers and green areas.
  • South Africa’s gold and platinum miners are aiming to bring back thousands of skilled workers from neighbouring countries. These highly skilled workers are crucial in helping the country following the easing of South African lockdown measures.
  • Cigarette Ban Judgment Reserved: The ban on the sale of cigarettes was heard in the South African High court this week. The case was brought against government by the Fair Trade Independent Tobacco Association (Fita) which is arguing that the banning of the sale of cigarettes is irrational. After hearing arguments from both parties, the presiding Judge reserved judgment.
  • The Government has indicated professional non-contact sports matches may resume. Professional Non-contact Sports are set to go ahead without general spectators.

Stimulus and economic measures

  • The World Bank expect the South African economy to contract by 7.1% this year – 8% weaker than previously forecast and the deepest contraction in a century.
  • The Rand Merchant Bank (RMB) business confidence index (BCI), compiled by the Bureau for Economic Research, is it at the lowest level since the first survey in 1975.
  • The South African government has agreed to pay private hospitals a fee for Covid-19 patients that get treated in critical care beds in private hospitals. The fee includes the cost of all aspects of a hospital stay.

Public-Policy_COVID19-Newsletter-dividers_UAE

Exit strategy for business

  • UAE authorities are preparing to fully reopen the country’s borders after months of shutdown according to the latest from Dubai Tourism.
  • The country’s e-commerce sector was issued the highest number of licenses – 196 – in May 2020, according to data from the National Economic Register reported by Emirates news agency WAM, with a 300% rise in consumer demand for e-commerce services.

Stimulus and economic measures

  • Moody’s has affirmed the UAE’s Aa2 credit rating and its stable outlook, stating that its sovereign rating includes an assumption of unconditional fiscal support from the government of Abu Dhabi, which is also Aa2-rated and benefits from a sizeable sovereign asset pool held by the Abu Dhabi Investment Authority.
  • UAE has announced the launch of an AED 1 million ‘Emirates Publishers Emergency Fund’ to support a host of publishers in the UAE whose businesses have been severely impacted by the outbreak of the coronavirus pandemic.

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