UK is running out of options to spur an economic recovery


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While it has its charms, the London Wetland Centre is not a first-rank visitor attraction in a city bursting with international landmarks of culture and history. The wetlands do have a niche appeal, however, especially for families seeking a fun day out during the summer holiday period. So imagine how disconcerting it was to find that I could wander for huge sections a few days ago without seeing another patron.

The pandemic-triggered lockdown wiped out 20 per cent of the British economy in the first half of the year, although it has eased in recent months and the bounce-back in June was eight per cent.

As my trip to the wetlands in mid-August demonstrates, there is a powerful mental lock on people's outdoor movements. The Covid-19 death toll in the UK is among the highest in the world because the Conservative government waited just too long to trigger the stay-at-home message. There is a powerful correlation between the death toll at lockdown and the subsequent path of infection.

On the other side of the "sombrero-shaped" graph of the coronavirus caseload, the unwinding is fitful. More than its neighbours, the British economy has a lot of ground to make up. There is an undisguised race among countries to be at the forefront of the recovery. Unfortunately it is a race that even the magazine that Prime Minister Boris Johnson used to edit, The Spectator, last week declared his government was losing. Badly.

Much of British prosperity in recent decades was built on growth of the services sector following the relative eclipse of manufacture and raw materials. On top of that, a strong consumer bias within the economy made up for weakness in export-led sectors.

You might think that services are more easily adapted to the work-from-home shift than factory floor-reliant businesses in, say, Germany. But several factors turned that assumption on its head. For one, Germany found a combination of measures to ensure the outbreak was smaller. About four in five businesses did not shut down during the peak lockdown period.

Demand for the UK's services was also hard hit. Whatever happens from here, economists expect British retail sales to be one-quarter lower in 2020 than 2019.

The London Wetland Centre is a conservation hub but it provides a service. Every day it cannot open is a lost chunk of business. That its potential visitors are still reluctant to travel to its paths is an ongoing blow to its revenue.

A manicurist could only resume offering services on Saturday due to ongoing government curbs on specific sectors. Gyms have reopened but only under strictures of social distancing.

Journeys by car have finally returned to pre-crisis levels but this may be because risk-averse Britons are avoiding public transport. Thus actual levels of those on the move are still lower. Mobile phone data from around Europe shows the UK has the highest proportion of people at home during any given snapshot.

An effort to allow holidays abroad in countries designated for travel corridors has collapsed and the government is now facing the wrath of those in France, who are this weekend scrambling to get home after quarantine was suddenly reimposed.

Some businesses have adapted but it is questionable how viable new lines of activity are likely to be over the long run.

Turnbull and Asser, a central London tailor favoured by the dapper Prince Charles, turned its sewing machines to make personal protective equipment at the height of the hospital crisis. It is now selling vividly patterned face masks that resemble its distinctive cotton shirt range. The commuter mask sells for £45 while a tie from the firm sells for £133 and a made-to-measure shirt costs £245 before discounting.

The UK Chancellor of the Exchequer Rishi Sunak's 'Eat Out to Help Out' scheme has been successful. EPA
The UK Chancellor of the Exchequer Rishi Sunak's 'Eat Out to Help Out' scheme has been successful. EPA

Much attention has been given to opening schools and how restaurants can get back to business – one successful scheme has seen the government pick up part of the bill for eating out from Monday to Wednesday.

How to engineer a workplace-led resumption of normal life? Surveys have shown that only half of workers are back in the office and just 49 per cent of 2,000 employees surveyed last week expressed confidence in returning. In France, meanwhile, a full 84 per cent of employees are back.

The cumulative effect cannot be good. As the weeks elapse, it is hard to see how a snapback recovery can come about. And if it does not, investors could stop putting forward money in anticipation of growth. Faith in maintaining workers on the payroll as a smart strategy to anticipate the upturn will seep from employers. The drip, drip of lay-offs will further inhibit the prospect of recovery.

If there is a miracle rebound, it will have to come from government-led spending. According to theory, that means a rebalancing of the economy.

Upheaval looms while Britain is marooned in a cocooned state.

Damien McElroy is the London bureau chief of The National

The Rub of Time: Bellow, Nabokov, Hitchens, Travolta, Trump and Other Pieces 1986-2016
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Key facilities
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  • Premier League-standard football pitch
  • 400m Olympic running track
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Key figures in the life of the fort

Sheikh Dhiyab bin Isa (ruled 1761-1793) Built Qasr Al Hosn as a watchtower to guard over the only freshwater well on Abu Dhabi island.

Sheikh Shakhbut bin Dhiyab (ruled 1793-1816) Expanded the tower into a small fort and transferred his ruling place of residence from Liwa Oasis to the fort on the island.

Sheikh Tahnoon bin Shakhbut (ruled 1818-1833) Expanded Qasr Al Hosn further as Abu Dhabi grew from a small village of palm huts to a town of more than 5,000 inhabitants.

Sheikh Khalifa bin Shakhbut (ruled 1833-1845) Repaired and fortified the fort.

Sheikh Saeed bin Tahnoon (ruled 1845-1855) Turned Qasr Al Hosn into a strong two-storied structure.

Sheikh Zayed bin Khalifa (ruled 1855-1909) Expanded Qasr Al Hosn further to reflect the emirate's increasing prominence.

Sheikh Shakhbut bin Sultan (ruled 1928-1966) Renovated and enlarged Qasr Al Hosn, adding a decorative arch and two new villas.

Sheikh Zayed bin Sultan (ruled 1966-2004) Moved the royal residence to Al Manhal palace and kept his diwan at Qasr Al Hosn.

Sources: Jayanti Maitra, www.adach.ae

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Read part three: the age of the electric vehicle begins

Read part two: how climate change drove the race for an alternative 

Read part one: how cars came to the UAE

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Ain Dubai in numbers

126: The length in metres of the legs supporting the structure

1 football pitch: The length of each permanent spoke is longer than a professional soccer pitch

16 A380 Airbuses: The equivalent weight of the wheel rim.

9,000 tonnes: The amount of steel used to construct the project.

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192: The amount of cable wires used to create the wheel. They measure a distance of 2,4000km in total, the equivalent of the distance between Dubai and Cairo.

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Low turnout
Two months before the first round on April 10, the appetite of voters for the election is low.

Mathieu Gallard, account manager with Ipsos, which conducted the most recent poll, said current forecasts suggested only two-thirds were "very likely" to vote in the first round, compared with a 78 per cent turnout in the 2017 presidential elections.

"It depends on how interesting the campaign is on their main concerns," he told The National. "Just now, it's hard to say who, between Macron and the candidates of the right, would be most affected by a low turnout."

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Fatherland

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Hometown: Cologne, Germany

Family: Wife Hanan Ahmed and their three children, Marrah (23), Tibijan (19), Amon (13)

Favourite dessert: Umm Ali with dark camel milk chocolate flakes

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Breakfast routine: a tall glass of camel milk

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