South Australia Imposes Six-Day Lockdown to Curb Outbreak

(Bloomberg) --

South Australia announced a six-day lockdown to help contain a growing cluster of Covid-19 infections, imposing the nation’s strictest state-wide stay-at-home orders since the pandemic began.

From midnight, only one person from each household will be allowed to leave home each day, and only for specific purposes, authorities said. Schools, universities, cafes and restaurants will close and mask-wearing will be mandatory.

“Time is of the essence,” state Premier Steven Marshall said Wednesday. “And we must act swiftly and decisively, we cannot wait to see how bad this becomes.”

Twenty-two people in the state capital Adelaide have been infected after a cleaner at a quarantine hotel was exposed to the virus, and health authorities say the “circuit breaker” measures are necessary to avoid a wider outbreak.

The state of 1.7 million people, who are spread out over a landmass five times the size of the U.K., had largely eradicated community transmission of the virus after a nationwide lockdown earlier this year.

The cluster, and a more severe outbreak in neighboring Victoria state that triggered a three-month lockdown in the city of Melbourne, show that ongoing vigilance is required to control the virus -- even in a nation that has been spared the scale of infections and deaths experienced in Europe and the U.S.

Other parts of the nation have now deemed South Australia a virus hotspot and reimposed state border restrictions. That could prove a further blow to efforts to reinvigorate the tourism industry just as Australia heads into its peak summer holiday season.

“There is no second chance to stop a second wave,” Marshall said. “We are at a critical point, but we will get through this.”

Factories other than those producing food and medical products will be closed for six days, as will the construction industry. Critical infrastructure and essential services including supermarkets and petrol stations will remain open.

The measures won’t have the same economic impact as the shutdown in Victoria, the nation’s second-largest state economy after New South Wales. South Australia’s economy represents around 5% of national gross domestic product.

What Bloomberg Economics Says

“South Australia’s A$110 billion economy accounted for 5.7% of Australia’s GDP in 2018-19. While a two-week period of restrictions could shave up to 0.1-0.2 percentage points off GDP in 2020, the hit to activity is unlikely to see Australia’s GDP contract in 4Q, given the boost to growth from the reopening of Victoria’s economy.”

-- James McIntyre, economist

Victoria’s outbreak was also linked to quarantine hotels, where security guards failed to observe safety protocols and spread the virus back into their communities in Melbourne. Authorities in Adelaide are examining how the cleaner became infected.

©2020 Bloomberg L.P.