End transmission: covid-19 in New Zealand

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Hello and welcome to the Intelligence on Economist Radio. I'm your host Jason Palmer. Every weekday we provide a fresh perspective on the events shaping your world. Lockdowns and border closures have put a cork in plenty of industries, but few more essential than agriculture. In Europe, crops are ripe, but there are few hens to pick them. In the Netherlands alone, there are a billion kilos of potatoes growing eyes. And the COVID19 response in Turkey isn't so different from those in other countries. With one notable exception, the country has guaranteed supplies of cologne. It's a hand sanitizer with a difference and one already ingrained in the culture. First up, though, Today New Zealand's Prime Minister Jacinda Ardern said the country had stopped COVID 19 in its tracks. On Sunday, officials recorded just one new case.

There is no widespread undetected community transmission in New Zealand. We have won that battle, but we must remain vigilant if we're to keep it that way.

So at midnight tonight, the country will begin to loosen the strict lockdown measures it put in place a month ago.

That includes safely returning more New Zealanders to work, enabling more businesses to reopen, and allowing some of the recreational activities we've missed in the past four weeks.

New Zealand's ambitious strategy has been to rid itself of the virus altogether, but it's not the only country that's nearly Covid free. Australia, South Korea and Taiwan are also now contemplating life beyond the virus. Countries policy responses to the pandemic vary widely, but New Zealand's approach may provide an anchor for a virus free region of the world.

The mood in New Zealand today on the cusp of the lockdown loosening I think, is one of cautious optimism.

Kinley Salmon is a staff writer at the Economist.

People are also just looking forward to a bit more normality, being able to get things like take away food again, which hasn't been possible for five weeks. One enterprising New Zealander did manage to freeze a box of Kentucky Fried Chicken at the beginning of the lockdown, which he's been enjoying at his leisure. But almost everyone else has been cooking for themselves for over a month.

And aside from fresher fried chicken, what changes today? What is moving down a level?

Well, there will still be a number of restrictions in place, but the government says that about an extra 500,000 people will be able to go to work. That's about twice as many as were able to go in the last month when it was just essential workers and things like construction, manufacturing will reopen as long as they can put in place acceptable safety. Schools will open, at least for students who can't stay home and other activities. Some of the funer parts of life will be a little bit more possible again. So Kiwis can fish again and they're allowed to go surfing as well. Although the Prime Minister, perhaps doubting Kiwis natural surfing ability, did caution New Zealanders this is not the time to try out a potentially dangerous new hobby.

And so New Zealand has had quite an unusually strong lockdown so far. What has the Prime Minister's objective been in going about it this way?

New Zealand has set itself quite a unique goal of actually eliminating the virus entirely from its shores. The hope is that this would bring really significant benefits. Whilst many other countries risk a cycle of lockdowns, perhaps gradual reopenings and then maybe fresh restrictions as another wave of infections hits, New Zealand's government believes that it may be able to send New Zealanders young and old, back to work without having to worry that the number of cases will surge again altogether. Because it's actually gone from the country completely. This could mean that schools, shops, restaurants could all operate without special social distancing requirements. Live sports with an audience could begin again. And this of course would potentially provide a lot of certainty for businesses who could then hire people, invest in new equipment without having to worry that in a couple of weeks they might be shut down again. And the Prime Minister herself has really emphasised this and warned that oscillating between different levels of lockdown could be much worse than what they're hoping to do with this strategy of elimination.

And how achievable does that seem to be?

Well, there's no doubt that finding every last case of the virus will be very difficult. Currently there's testing of workers that don't have any symptoms, but that are in jobs which might be risky, like supermarket workers or health workers. That kind of testing will need to be expanded a lot. It's been described as finding a needle in a haystack by the Prime Minister herself. Perhaps most significantly though, elimination as a strategy means that really strict border requirements will have to stay in place. So today almost all foreigners are barred from entering New Zealand and even returning citizens are placed in quarantine for 14 days in monitored hotels. And the government's own economic models assumes that New Zealand may have to stay closed or will have to stay closed to foreigners for a whole year. Of course, though some do doubt whether this is feasible or even worthwhile to do for such a long period.

Well, worthwhile is certainly a question that's being asked all over the place, everywhere that there is a lockdown. These sorts of trade off questions. What will the costs be of a virus free island, but one that has exactly zero people passing across the border?

While it's important to recognise that of course New Zealand will be affected regardless of what it does with its borders, it's going to be hit by a global economic downturn just like everywhere else. But of course, these border controls do add some extra complications. A big one is with tourism, which was New Zealand's biggest export sector. 4 million people visit New Zealand most years, and this kind of strict border controls could knock about 5% off of GDP and put potentially 100,000 people out of work. And similarly, exporters need to still get their product out. And while the border is open for goods, there are far fewer planes leaving to take those products out with them. And before this crisis, New Zealand had 80% of its air freight go on passenger planes, but 95% of the flights of the national carrier Air New Zealand have been cancelled. And so it's now a real struggle to find space to even get your horticulture products out to the rest of the world.

And how does New Zealand compare regionally? I mean, there are a couple of other evident success stories not too far away.

That's right, there are other countries in the region that are also having real success at keeping the number of new cases down to very low levels. So Australia, South Korea and also Taiwan, although they're recently struggling with a new outbreak coming from a naval vessel. Australia, for example, has been able to reopen its beaches. People are swimming and surfing again. They're opening up elective surgeries and dental care and South Korea is even allowing people to take holidays domestically. But it is true that in all these places officials are cautioning that it's not going to go right back to normal quite yet.

But also in the region there are places that have had no cases whatsoever, right? I mean other countries that presumably also have their borders closed.

That's right. Some of the Pacific islands have had no cases or in some places only very, very few. And they've also taken very strict border measurements to try to protect their populations and simply keep the virus out in the first place. That's working quite well it seems. But of course many of those countries rely on tourism and it's not easy to keep your borders closed for a long period to do that.

Well, is there some capacity for the notionally virus free countries and territories to essentially coordinate their efforts to cooperate under a virus free banner?

Yeah, there absolutely is. A number of these countries are beginning to talk about potential virus free zone. The Prime Minister of New Zealand and the Prime Minister of Australia, Scott Morrison have already discussed a potential Trans Tasman virus free bubble. And this would only happen of course once they were certain that in both countries the virus was truly and verifiably under control and frankly almost non existent. And then there's also hope that that could expanded to other countries, perhaps those Pacific islands as well. So there could be a broader virus free zone in the Pacific. But of course that all does depend on whether there truly is no virus in the region and that remains to be seen.

Thanks very much for your time, Kinley.

Thank you.

For lots more globe spanning analysis like this, subscribe to the economist. To get 12 issues for $12 or 12 pounds just go to economist.com radioffer. Much of global commerce might have ground to a halt because of COVID 19. But one thing that can't be paused is the march of the seasons. In Europe the weather is getting warmer, the birds are in song and fruit and vegetables are ready for picking. Yesterday, Britain's Environmental Secretary George Eustace warned that much of these crops could be left to rot and fields.

We're also acutely aware that we're about to start the British season in fresh produce in soft Fruits and salads. We estimate that probably only about a third of the migrant labour that would normally come to the UK is here and was probably here before lockdown.

European farms rely on seasonal migrant labour to harvest their produce. The pandemic is keeping many workers at home.

Europe normally depends on migrant workers, mostly from Eastern Europe, to plant and pick its crops, but that has been thrown into turmoil because of the COVID 19 epidemic.

Matt Steinglass is our Europe correspondent.

A lot of them can't travel because of border restrictions. Others are worried about getting stuck in quarantines. And a lot of Western European farmers are worried that they won't be able to harvest their crops this year.

So I guess there's two problems there. One, what happens to those laborers and the jobs they would have had, but also to the crops themselves?

Yes, it's a really large number of laborers. I mean, in Germany, you're talking about up to 300,000 agricultural workers who would normally show up over the course of the whole season. In France, it's about 200,000. Spain might be 70 or 80,000. In Italy, I've heard different numbers ranging from 200,000 up to 270,000. These people would normally be coming in from Romania, Poland. In Italy, they got workers in from Albania and as far away as India. If these people don't show up, then it's a major chunk of your economy that's been taken out of action and that is likely to end up having an impact on the supply of at least some crops.

So if the crops aren't being harvested, how much food are we talking about that could go to waste?

Yeah, it's difficult to estimate what the impact would be. But just to give you a sense of what happens when these kinds of disruptions take place, in the Netherlands, potato farmers would normally be shipping out huge quantities of spuds to supply restaurants with French fry material. That has been completely cut off because restaurants are closed and Dutch farmers are now stuck with a billion kilos of potatoes.

And pardon the pun, but what's the root cause here? This is just that migrants are not allowed to move around because of border closures.

It's a multifarious problem in principle. The EU has said migrants who are coming to pick crops on farms are vital workers. They should be allowed through border checkpoints, and all EU countries have agreed to this. But in fact, police take these commands differently, interpret them differently in different places. In Sweden, farmers are worried that police are turning away migrant workers if they don't have a job contract already. In other cases, It's a problem of logistics. Migrants have to get from Romania all the way to France. To do that, you might need to pass through Hungary. Hungary's borders are closed. As a result, some countries are organizing planeloads. Germany is flying people in directly from Romania to pick the asparagus crop. Some of them are being flown into Eindhoven in the southern Netherlands in order to get on buses and go directly to Belgium to pick asparagus and strawberries. It's just a huge logistical scramble because the normal routes that have been built up over the last 30 years are now tangled. Another problem is that some countries, notably Poland, have decreed that anybody who comes back from the west has to go into quarantine for 14 days. So a lot of Poles are staying home, not because they would be blocked from going into Germany, but because they're worried that if they come back, they'll be stuck in quarantine.

So if part of the problem here is border closures, what about people within each country's borders picking up the slack?

Most rich countries are trying to get locals to volunteer to do the agricultural work that can't be done by migrants. There are campaigns in the United Kingdom. In France, they're trying to raise what they're calling La Grande Armee de l', Agriculture, which is a reference to the Grande Armee in Napoleonic times. And some people are volunteering. But in the UK, they say that out of 36,000 people express an interest, only 6,000 actually showed up for an interview. In France, they are both having trouble raising the numbers that they want to get. And the people who show up are not used to this kind of work. Agricultural work is extremely difficult, and people underestimate how important it is to have a few years of experience. Picking asparagus, for example, is very hard. You're bent over these rows of asparagus for 10 hours a day or more. You have to pick the stalks very carefully because they're delicate and they can break. They're worth a lot of money. Your farmer employer will get very angry at you if you break the stalks. And the students who are starting to apply for these jobs and are doing them for the first few days or first few weeks are saying that they're exhausted and it's very hard. At some point, they may get some experience under their belt and will be decent workers, but in the near term, it's really going to hurt agricultural productivity.

And I suppose that all of this unpicks the economics of agriculture as we've known it.

As time goes on, there's an interesting economic dynamic going on here. On the one hand, the entire restaurant industry and hotel industry has been shut down and that means a loss of demand. So prices for some of these agricultural commodities go down. On the other hand, as time goes on, farmers are going to make the decision not to plant because of the drop in demand, or they're going to have trouble finding the workers they need to pick the crops. So you'll have a crash in supply which will drive prices up. What you've already seen, actually with the beginning of the asparagus crop in Belgium. At first, asparagus prices plunged because the restaurants were closed. Then they started to shoot up because farmers were worried that they wouldn't be able to pick the crop. So there may be some strange see saw dynamics in prices at the supermarket as these conditions continue.

And of course, this is not just a problem for Europe, though Europe has its own version of the problem.

Yeah, this is a problem that's repeating itself all over the world. The United States, interestingly, which has been very visibly trying to shut its southern border supposedly for the last three years, is fairly carefully keeping that border open to Mexican migrant agricultural workers to make sure that crops get picked in the United States. The observation that was made by the head of the Swedish Agricultural Union, which I thought was quite interesting, was Sweden's epidemic is not particularly worse or Better than the COVID 19 Epidemics in countries in Eastern Europe that it gets its migrant agricultural workers from. So allowing those workers to come in shouldn't really change the Dynamics of how COVID 19 is developing in Sweden. What it does do is make sure that Swedish farmers can get their crops picked.

Matt, thanks very much for joining us.

Thank you, Jason.

As COVID 19 first began its global march, one of the first products subject to panic buying was hand sanitizer.

The single most useful thing that we can all do is to wash our hands. Soap.

Soap. Come on.

I do it a lot anyway, as you probably heard.

Wash your hands, stay clean.

But store shelves in Turkey have been emptied of something different. Everyone's stocking up on cologne or in Turkish, colonia. It's the hand sanitizer the of choice and has been for centuries.

You will find it at homes across the entire country, especially in villages and small towns where hosts will spray Colonya on guests to kill bacteria and body odor.

Piotr Zalewski is our Turkey correspondent.

You'll also find colonia at restaurants where waiters will spray it on patrons and on long distance bus routes where bus attendants will splash a bit of colonia on every passenger.

So what is colonia? Is there anything different about it or is it just cologne? As I already know it, Colonia is.

The traditional cologne, a mix of ethyl alcohol, water and fragrance that is used all over Turkey. It does come in a number of fragrances. The most popular by far is lemon. But you can also find colonia scented with lavender, rose, jasmine, orange, fig blossom and even tobacco.

So why is colonia so entrenched in the culture anyway?

Turkey has long been a land of germaphobes, and colonia plays a large part in that. Everywhere you go, food vendors will hand out wet wipes. Ablutions before prayers are part of religious life, and overall hygiene is prized. In fact, in a Gallup poll From, I think 2016, Turks scored higher than any country in Europe except Bosnia and Herzegovina. When asked how often they washed their hands after a trip to the toilet, 94% answered in the affirmative, which was much higher than France 62%, Italy 57% and the Netherlands 50%.

And why is it that people are turning to cologne colonia instead of hand sanitizers during COVID 19?

So hand sanitizers are also used widely, and so is soap. But colonia is considered to be equally, if not even more effective. And most importantly, it is a matter of national culture. So much so that maintaining a steady supply has become a matter of national government policy. And at the beginning of the pandemic, and when the Health Minister, Fahrentin Koja, recommended colonia to fight COVID 19, you would actually see long queues at chemists and stores that sold colonia across Turkey. That is no longer the case, as the government has guaranteed supplies, but sales have skyrocketed. I think one online retailer reported a 3,400% sales increase in a single week.

So what do you mean that the government has guaranteed supplies?

The Health Ministry leaned on local producers to pledge that they would not raise prices during the pandemic. The government then stopped requiring petrol producers to use ethanol in petrol in order to boost the production of colonia. And President Recep Tayyip Erdogan at some point promised to distribute the stuff to the elderly. The latest Colonya related development is that Turkey has introduced restrictions on lemon exports amid surging demand for lemon scented cologne.

And does it work as intended? Is it as effective as hand sanitizer would be?

It seems so. Cologne contains at least 60% alcohol, and most colonia products contain 70 to 80% alcohol, which means that it can kill 80% of germs and be as effective as hand sanitizer or other forms of hand disinfectant.

So it's sort of a combination of things. A germophobic culture who also prized cologne. These things come as a natural match. I guess you could just use soap.

You could indeed just use soap. Soap is actually cheaper, but not by that high a margin. You know, Turkish colonia is not exactly Dior or Dolce Gabbana. Small bottles will sell for about 10 to 12 lira for 200ml and that's just over a pound. And on top of everything else, compared to soap, colonia smells nicer.

Makes sense, as it were.

Piotr, thank you very much for your time.

Thank you for having me.

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