By Geoffrey Smith
Investing.com -- Seconds out, round three.
The Covid-19 virus won round one of its fight with humanity easily – killing thousands and wrecking the lives of millions more with bereavement, illness, unemployment, disorientation and unprecedented levels of stress.
It also started round two strongly, with a surge in case numbers and deaths around the world as leaders – in the words of the World Health Organization – “dropped their guard”, undoing much of what had been achieved.
But humanity fought back strongly: the vaccines started flowing and, despite a number of local disasters, the pressure on many health systems around the world has eased significantly. Global case numbers and deaths have been on a firm downward path since February, while the number of vaccine doses administered has raced toward 3.5 billion. Round Two went to us.
So why the sudden Angst stalking global markets about a third round of Covid-19? True, the delta variant that devastated India appears more highly transmissible than the previous iterations. And that clearly spells trouble for emerging-market economies with dense populations and under-resourced health systems. This week alone, Indonesia slashed its growth target this year against a backdrop of a parabolic rise in cases and record death numbers. And Thailand’s central bank also warned it would likely miss its growth target, as the pandemic continues to deter inbound tourism.
Delta’s high transmissibility is also making for some dramatic, even desperate, moves in Europe. Russia is reporting record deaths. Spain and Portugal, two of the continent’s biggest summer tourism destinations, are starting to show spikes.
France, the world’s largest destination for tourism and a country where only 36% of people are fully vaccinated, has a particular capacity to act as global accelerator of the pandemic. Its government is looking accordingly panicky. On Monday, President Emmanuel Macron announced a sweeping extension of the list of things that won’t be possible this summer without proof of immunity, whether acquired naturally or through a vaccine: crucially, they include any sort of long-distance travel, making vaccination effectively a precondition for a vacation. Health Minister Olivier Veran meanwhile said on Tuesday that health workers would not be paid unless they were vaccinated.
But if you want a look at how round three is going to pan out, then look at the United Kingdom.
Only two weeks ago, riding a wave of confidence generated by one of the world’s highest vaccination rates, the government confirmed it will lift almost all remaining restrictions on social distancing and mask mandates on July 19.
On Monday, however, Prime Minister Boris Johnson warned urgently that “the pandemic is not over” and warned of an abiding need for caution. The reason? New case numbers have soared to their highest since January. Daily hospital admissions, which peaked at over 4,500 in January, have risen from a low of 100 in May to nearly 600 and may crest at 2,000 in the coming wave, health experts have warned. The dramatic and sudden loosening of restraints will test the effectiveness of the approved vaccines to the limit.
The Covid-19 virus is still young and rapidly mutating. New strains are still fighting with each other in their own Darwinian battle for dominance. And the higher number of new cases, the more new variants will emerge. As such, vaccine makers will remain under constant pressure to adapt their products to deal with new variants, and health systems will have to stay agile in their to suppress them.
The risk of a new strain that avoids all the most widespread vaccines can’t be ruled out, but the evidence so far shows that the vaccine makers are quite capable of keeping up with Nature.
A recent Israeli study showed that the Pfizer/BioNTech vaccine was less effective now that the delta variant had become the dominant strain in the country. However, with a 93% success rate, it was still astoundingly effective in stopping serious infection.
Pfizer (NYSE:PFE) and BioNTech are now proposing to the U.S. Food and Drug Administration that people should get a third shot of their vaccine to bolster their defenses, although a separate Israeli study says the benefits of this may be limited to those with weakened immune systems. Meanwhile, WHO-backed studies on 'mixing and matching' vaccines to produce better immunity levels are still ongoing.
However, policy makers’ record in dealing with the evolving threat has been patchy, and humanity at large – driven to distraction by the interminable disruptions to life - can’t help but leave the virus plenty of chances to strike back. The boxing match remains too finely-balanced for comfort.