4 ★ FINANCIAL TIMES Wednesday18 March 2020
is likely to be most disruptive in coun-
tries such as Finland, Denmark and
Sweden, where nearly all children
under 12 years old are in some form of
formal childcare that will close down —
whether provided by the state or by a
privatecompany.
The impact may be mitigated by par-
ents who benefit from a more common
culture of remote working than in peer
countries.
Overall, economists warn that places
with weaker social security systems are
likely to feel the strain sooner, whether
they are poorer economies or countries
such as the US that have a smaller
welfarestate.
“In the US about 15m people, or
around10percentoftotalemployment,
work in alternative work arrangements
as contractors, on-call workers, and
temp help agency workers,” said
Torsten Slok, chief economist at Deut-
scheBankSecurities.
“Countries without paid sick leave
and without social safety nets are likely
tobehitharder,”headded.
Council said on Friday that up to 50m
jobs in the sector are now at risk as bor-
ders close and governments restrict
movement.
“Services, in particular those related
to tourism and to non-core consump-
tion, will suffer a massive hit,” said
Nicola Nobile, an economist at Oxford
Economics.
The US, with its diversified economy,
is less reliant on tourism than many
otherrichcountries,accountingforonly
8percentofgrossdomesticproduct.
But in Italy, tourism generates 13 per
cent of GDP, the second-highest propor-
tion in the G20 after Mexico. Thailand is
highly susceptible to a crash in visitor
numbers, with nearly a quarter of its
economy reliant on travel and tourism.
Arrivals into the country more than
halved in February compared with last
year, according to data from the Associ-
ationofThaiTravelAgents.
Economistswarnthatpeopleworking
from home while juggling childcare
might turn out to be an additional drag
on the economy. The closure of schools
populations in the world. This puts
them in a uniquely vulnerable position,
as statistics suggest that people over
70 are the most likely to suffer severe
complications from coronavirus. Some
28 per cent of Japan’s population is aged
over65,asis22percentofGermany’s.
One main area of concern in the US,
say experts, ispatchy insurance cover-
age. Almost 18m Americans did not
haveinsurancein2018,accordingtothe
KaiserFamilyFoundation.
US insurers have agreed to cover the
costs of testing, but it could still cost an
uninsuredpersonthousandsofdollarsa
dayiftheyneedtobetreatedinhospital.
The analysis also shows which coun-
tries are more likely to suffer economi-
cally. The World Travel & Tourism
inflatable tents in their grounds and
patientscrowdthecorridors.
“The US has excellent diagnostic
capabilities but where it really falls
short is on access to healthcare, espe-
cially for healthcare workers them-
selves,” said Jessica Bell, who helps com-
pile a global health security index for
the Nuclear Threat Initiative, a non-
profit organisation that works on catas-
tropheprevention.
Healthcare workers are beginning to
sound the alarm. Hospitals in the US are
already quite full because the flu season
is under way. Capacity issues are being
compounded by an influx of coronavi-
ruscases.
“Already we are hearing of nurses
having to fight to get the respirators
they need — though the biggest worry is
what happens when those nurses start
getting sick,” said David Pratt, health
and safety representative at the New
YorkStateNursesAssociation.
Japan, Germany and Italy may have
the most capacity in their healthcare
systems, but they also have the oldest
K I R A N STAC E Y —WASHINGTON
VA L E N T I N A R O M E I— LONDON
TheUSandUKhaveweaknessesintheir
healthcare systems that could trigger a
collapse if exposed to a coronavirus out-
breakassevereasItalyhasexperienced,
aFinancialTimesanalysishasfound.
Both countries have fewer hospital
bedspercapitathanmostotherwestern
nations, the analysis shows. While the
US and UK have about two beds per
1,000 people, Germany, by comparison
has six, while Japan has 7.8, according to
the OECD group of mostly wealthy
nations.
The US also lags behind on the
number of doctors for its population,
with 2.6 per 1,000 people. That com-
pares with 4.3 in Germany and four in
Italy, where hospitals have had to erect
K I R A N STAC E Y— WASHINGTON
H A N N A H KU C H L E R— NEW YORK
H A N N A H M U R P H Y— SAN FRANCISCO
Politicians in Washington state are call-
ing on the Trump administration to
guarantee supplies of protective equip-
ment to local doctors, as hospitals there
warntheyarefastrunningoutthanksto
thenumberofcoronaviruscases.
Eight members of Congress and two
senatorshave writtento the US health
secretaryurging him to step in,hours
after President Donald Trump told gov-
ernors they should rely on the private
markettobuythesuppliestheyneed.
The letter warns: “We remain deeply
concerned that the current supply of
PPE [personal protective equipment] is
inadequate to meet the need for PPE in
Washingtonstate.”
Washington has been at the frontline
of the US coronavirus outbreak, with
676casesand41deathsasofMonday.
This monthSeattle, the state’s largest
city, requested an additional 450,
piecesofprotectiveequipmentfromthe
strategic national stockpile. This week
somehealthcentresinWashingtonstate
have been receiving protective equip-
ment from Direct Relief, an interna-
tionalnon-governmentalorganisation.
In an email seen by the Financial
Times, community health representa-
tives in Washington warned this week-
end: “Shipments are simply inadequate
to the need... These supplies will be
depleted this week. After that, our clin-
ics will be faced with a, frankly, terrible
choice: ask their providers to continue
working without protection, or cease
anyCovid-relatedactivity.”
According to the politicians’ letter,
the Washington State Hospital Associa-
tion is not getting the supplies of protec-
tive equipment it needs, while a rehabil-
itation centre in Richmond Beach
onlyhadaweek’sworthofsuppliesleft.
The letter warns: “The lack of PPE
endangers the health of people on the
front lines, including local health agen-
cies, health workers and emergency
personnel, and limits their ability to
respond to those in need and to effi-
ciently curtail the Covid-19 pandemic.”
While Washington is suffering some
of the most acute shortages, other US
states are also warning of problems. The
Californiahealthdepartmentsaiditwas
experiencing shortages of N95 respira-
tor masks in particular, and that it had
placedordersforanadditional300,000.
Nursing homes have been particu-
larly badly hit, partly because they do
not normally need large stocks of pro-
tective equipment, and some suppliers
areprioritisingexistingcustomers.
Almost a third of long-term care facil-
ities said they had no masks in their
inventory, and 68 per cent said they had
eitherlimitedornowayofgettingmore,
according to a survey by Premier, an
association representing more than
4,000UShealthcareorganisations.
The US health department said: “The
department takes all congressional
inquiries very seriously and will
respondinatimelyfashion.”
Katie Smith Sloan, president of Lead-
ingAge, a non-profit organisation, said
nursing homes had no way to report
whattheirneedswere.
“They are having serious difficulties
getting access to needed supplies right
now,”shesaid.
Many states have requested addi-
tional supplies from the strategic
national stockpile, which has so far
shipped 135 tonnes of cargo as part of its
coronavirus relief effort, including pro-
tectiveequipmentformedicalstaff.
But Mr Trump told state governors
not to rely on that resource.He said the
federal government was ordering “tre-
mendous numbers of ventilators and
respirators” butsaid it would be faster
forgovernorstogetventilators“ontheir
own”,throughtheirusualsupplychains.
M E H U L S R I VA STAVA— TEL AVIV
Israel’s Shin Bet security service will
usedataharvestedfrommillionsofcell
phones to triangulate the locations and
travel patterns of people exposed to
coronavirusinoneofthemostcompre-
hensive national surveillance exercises
anywhereintheworld.
The plan, authorised this week by care-
taker Prime Minister Benjamin Netan-
yahu as an emergency measure, allows
the Shin Bet to tap into a trove of meta-
data including location, identity and
other markers that the country's cell
phone operators are required to main-
tainaspartoftheirlicenseagreement.
Mr Netanyahu, in announcing the
move, said the measure was temporary
and would be carefully regulated.
“Israel is a democracy. We must pre-
serve the balance between individual
rights and general needs, and we are
doingso,”hesaid.
But privacy advocates, opposition
members and even some members of
Mr Netanyahu’s own party have
expressed concern over the reach of the
plan and the accountability of the Shin
Bet. Mr Netanyahu took the decision
without consulting parliament and
against the objections of several mem-
bers of his security cabinet, which
clashed over this issue for hours on Sun-
day, according to one person familiar
withthediscussions.
Cell phone companies have provided
the Shin Bet with access to customer
data since the early 2000s, but the intel-
ligence agency is only supposed use it in
cases involving terrorism or national
security.
The mass surveillance will continue
for at least the next fortnight, according
to the decree, and the Shin Bet says it
willshareinformationwiththeministry
of health, rather than get involved in
enforcingviolationsofquarantine.
The agency was initially reluctant to
use its surveillance powers to assist the
health ministry because of the spotlight
it would place on its secretive opera-
tions, but was ordered to do so by the
prime minister's office, said a person
familiar with the matter who asked not
tobeidentified.
“This is not what we do, and not what
we are trained to do,” the person said.
“Butit'satimeofnationalemergency.”
In theory, the technology will allow
thehealthministrytolocatepeoplewho
had been in the vicinity of infected or
dormantcarriersofthecoronavirusand
retroactively warn them to go into self-
isolation,accordingtotwopeoplefamil-
iarwiththedecision.
In a short statement to the media,
Nadav Argaman, the Shin Bit chief, said
he had sought legal advice before going
ahead with the initiative and that the
data collected would be handled by a
small number of staff and deleted
immediately after. The Shin Bet
declinedtocommentfurther.
Privacy advocates said they were con-
cerned by the speed with which this
decision was made, without parliamen-
tary oversight, and the fact that secret
service is shielded from scrutiny by a
thicketofnationalsecuritylaws.
“The Shin Bet itself is a body which is
not subject to the Freedom of Informa-
tion Act,” said Dr. Tehilla Shwartz
Altshuler, a senior researcher at the
IsraelDemocracyInstitute.
One of the leaders of the Joint List of
Arab Parties, Ayman Odeh, asked for an
immediate suspension of the pro-
gramme.
A N D R E W E N G L A N D A N D
DAV I D S H E P PA R D— LONDON
H E N RY F OY— WARSAW
Crown Prince Mohammed bin Salman
was at a low ebb when Russia’s Presi-
dent Vladimir Putinswept into a room
of world leaders. Saudi Arabia was fac-
ing its biggest diplomatic crisis in years
after the murder of Jamal Khashoggi
weeks earlier, and the kingdom’s heir-
apparent, who many blamed for the
journalist’s killing, had faced a cool
receptionattheG20gathering.
But Mr Putin smiled broadly as he high-
fivedPrinceMohammedandtookaseat
next to the beaming Saudi. The meeting
in Buenos Aires in November 2018 epit-
omised the warming relationship
between two authoritarian leaders
whose nations spent decades on oppos-
ing sides of global divides but had found
common interest in maintaining the
stabilityofoilprices.
That compact collapsedlast week as
two of the top energy producers became
embroiled in an oil price war that has
wroughtchaosonglobalmarkets.
Caught in the maelstrom is Donald
Trump, who ignored critics to stand by
Prince Mohammed after the Khashoggi
murder and has confounded many with
his repeated praise of Mr Putin’s leader-
ship. Just as the US president is gearing
up for an election battle under the cloud
of the Covid-19 outbreak, the Russian-
Saudi crude war threatens America’s
growing shale industry, hurts debt-
burdened US oilgroups and puts more
pressureoncollapsingstockmarkets.
“We’re in a three-way Mexican stand-
off with three big players in the room all
saying, ‘if you screw that guy over there,
youarescrewingmeover,soI’mgoingto
screw you over’,” said Michael Stephens,
an associate fellow at the Royal United
Services Institute. “It’s a strange trian-
gular discussion from which no side
wants to back down and all are going to
feelthepain.”
The price war erupted when Russia
rejected a plea from Saudi Arabia to
make deeper cuts to oil production to
stem the slide in prices as the coronavi-
rus pandemic spread, ending three
years of co-operation between the two
on crude output. Riyadh, the de facto
Opec leader, responded swiftly with its
most aggressive oil-related action in
decades, threatening to flood the mar-
ket with an additional 2.6m barrels a
day at hugely discounted prices. Bench-
mark crude prices plummetedmore
than30percentlastweek.
Moscow’s target is the US shale indus-
try, where output has soared4.5m b/d
since Prince Mohammed and Mr Putin
agreed to co-operate on production cuts
in 2016, chipping away at Russian and
Saudimarketshare.
Saudi Arabia, the world’s biggest
exporter, is bettingincreased volume
will cushion the financial impact of
tumbling prices, boost its market share
and either bring Moscow back to the
tableorreshapetheenergyindustry.
“With all the global criticism and peo-
ple jumping on the Khashoggi killing, I
think the feeling is, ‘we are not getting
credit for being the responsible [oil]
player that we are’, and ultimately eve-
rybody is in this for themselves. Why
should we sit and sacrifice for nothing?”
said a Saudi close to the royal court.
“The beauty of this is you can blame it
on the Russians. You have a legitimate
answer,‘GotalktoVladimir,he’stheone
whostartedthis’.”
The person added that it was in Saudi
Arabia’s interests to “allow this thing to
go on for a while to bring structural
changetotheindustry”.
“Get rid of weak shale players and
sendamessagetotheTeslasoftheworld
and alternative energy, there’s a lot that
could change the whole picture of oil,”
thepersonsaid.
Yet it is likely to reinforce Prince
Mohammed’s image as an impetuous
leader. It is also a big gamble for the oil-
dependent kingdom. The move, cou-
pled with the impact of coronavirus,
risks crashing the economy for a second
time in six years, while upending the
crown prince’s own plans to diversify
theeconomy.
Russia will also endure some pain but
it boasts higher foreign reserves and a
floating currency and is less dependent
on oil sales. The signals from Moscow
are that it is in for the long haul. Mr
Putin’s spokesman said the Russian
leader had “no plans” to speak to Prince
MohammedorKingSalman,hisfather.
“For Saudi Arabia, it believes that
every country that has fought the king-
dom in a serious price war has lost. But
we are facing an unprecedented situa-
tion from both the rise of shale and Cov-
id-19,” said Amy Myers Jaffe, a fellow at
the Council on Foreign Relations. “Low
prices won’t necessarily spur renewed
demand.”
The collateral damage will ripple
from Baghdad to Texas. A decade ago,
the US would havebenefited from lower
oil prices, but itsemergence as the
world’stopoilproducerhasalteredthat.
States thatbenefited from the shale
boom, among them Texas, North
Dakota and Pennsylvania, will be vic-
tims of a price war that seeks not just to
lowerpricesbuttocrashthem.
Additional reporting by Anjli Raval in
London
Congress concern
Trump urged to ensure equipment supplies
Hospitals in Washington
state say they are running
out of protective kit
Surveillance
Netanyahu
enlists Israeli
intelligence to
keep track
of sufferers
Healthcare.OECD analysis
Lack of beds heightens US and UK vulnerability
Germany and Japan have
more hospital capacity but
also have older populations
Staff at Sentara
Princess Anne
Hospital operate
a virus testing
station at
Virginia Beach
in the US
Stephen M. Katz/APEnergy
Oil battle between Saudi and Russia leaders puts pressure on mutual friend in Washington
Vladimir Putin meets Crown Prince
Mohammed bin Salman in 2016
The California health
department said it was
experiencing shortages of
N95 respirator masks
* US Sources: OECD; WTTC; UNSome countries have few
hospital beds for acute care
Acute care hospital beds per
people, *
Japan
S Korea
Germany
Greece
France
Netherlands
US
Spain
UK
Sweden
Canada
Mexico
Travel and tourism as of GDP among
selected G countries
Mexico
Italy
China
Australia
Germany
UK
India
Saudi Arabia
France
Brazil
US
Japan
Canada
Russia
S KoreaTourism is a large part of the
economy in many countries
estimates for Older populations are more vulnerable to the virus
Population years old (estimates for )
China
mUK mCircle size
millions of
Share of total () peopleSouth Africa
Japan
Germany
France
UK
US
Turkey Brazil Russia
S Korea
Australia
Italy
Canada
Indonesia
Mexico
China
Argentina
India
Italy
‘The US has excellent
diagnostic capabilities, but
where it really falls short is
on access to healthcare’
CO R O N AV I R U S
MARCH 18 2020 Section:World Time: 17/3/2020-18:48 User:john.conlon Page Name:WORLD3 USA, Part,Page,Edition:USA, 4 , 1