Australia shows the cost of zero Covid

The UK is growing at the fastest pace in 80 years. The United States, fuelled by President Biden’s stimulus programme, is expanding at a breath-taking pace, while Sweden is growing at a rapid rate. Most of the global economy is bouncing back from the Covid recession at remarkable speed. There is, however, one exception. Australia. What has long been one of the most successful economies in the world is heading back not just into lockdown but into recession as well — and giving the world a sharp lesson in the cost of ‘zero Covid’.

Over the last year, Australia, along with New Zealand, has been heaped with praise for the way it has managed to keep Covid-19 under control. There is, of course, plenty of justification for that. Infection and death rates are dramatically lower than they are in most other countries. And yet, there is a price attached. Many local economists are now forecasting that a recession is almost certain in the latest quarter.