Charlotte Street Partners



The Spanish paradox

Written by Javier Maquieira, senior associate 
Edited by David Gaffney, partner
29 July 2021

Good morning,

Spain has had very little to celebrate with regards to Covid-19, until recently. While countries such as the UK find themselves dealing with the third wave of coronavirus infections, my home country is currently undergoing its fifth epidemic wave, with 699 cases per 100,000 over a 14-day period.
Unlike previous waves, however, Spain isn’t just setting the record for the highest number of infections in Europe. In a more surprising development, it’s also leading the vaccination race, as data shows 54.7% of the Spanish population has been fully vaccinated, while 65% has had at least one dose of the Covid-19 vaccine. Spain has in fact surpassed the UK as the fastest European country in terms of vaccine rollout.
But here’s the paradox. Although vaccination has managed to protect the most vulnerable groups from infection and prevalence seems to be stabilising, the immunisation rate is still insufficient to relieve the pressure on some regional health systems, which have seen the number of people admitted to intensive care units double in recent weeks.
Many have blamed the sharp rise in cases among unvaccinated people, which make up 83% of positive cases, on a hastened easing of restrictions aimed at saving the summer and attracting foreign tourists. Yet things aren’t exactly looking up for the Spanish tourist industry either: the United States has issued a “do not travel” advisory for Spain, Germany has classified the country as high risk, and there are fears it could soon be on the amber-plus list for the UK.
The situation has left regional authorities at a crossroads between curbing infections among the unvaccinated and minimising disruption to the tourism and hospitality sector. A number of Spanish devolved governments have made vaccine certificates a requirement to enter leisure and hospitality venues as a solution, but other regions continue to oppose the measure on the basis that it discriminates against those who haven’t received their vaccine yet.
You can call it a policy dilemma, blame it on the young, or criticise the lack of coordination among devolved governments. For me, it’s perhaps just another glimpse of the complex and multi-layered nature of policymaking back home.


People who have been fully vaccinated in the EU or US will not need to isolate when coming to England, Scotland and Wales from an amber list country, the UK and Scottish governments have confirmed. Travellers will still need to take either a lateral flow or PCR test before departure and a PCR test on the second day after they arrive. The change will come into force at 4am on Monday, 2 August.
The Guardian has reported that the Queen’s lawyers “secretly lobbied” the Scottish government to amend a draft law in the Scottish parliament to exempt the monarch’s land from measures to encourage green energy and cut carbon emissions. The documents show correspondence between Scottish ministers and Buckingham Palace around the procedure known as Queen’s consent, which gives Her Majesty advance sight of legislation.
The latest UK State of the Climate report has concluded that Britain is already experiencing disruptive climate change, as shown by increased rainfall, sunshine, and temperatures. The report highlights that in the space of 30 years, the UK has become 0.9C warmer and six per cent wetter, and warns of increasingly extreme weather if politicians fail to curb carbon emissions.

Business and economy

The UK transport secretary, Grant Shapps, has announced that international cruises will be able to resume operations from England from Monday, 2 August after a 16-month break. As part of the safe restart of international cruise travel, the government and cruise industry have signed a memorandum of understanding to help the industry build back from Covid-19 while protecting people in Britain from future pandemic-related disruption.
The coronavirus job retention scheme is set to be further wound down from Sunday, as the UK government requires employers to make a bigger contribution to the furlough programme. The wage support scheme, which has been extended several times but is expected to end on 30 September, is credited with stopping a spike in unemployment, leading to fears that many people will be made redundant after that date.
The high court agreed on Wednesday to allow a judicial review against the Oil and Gas Authority (OGA), which set out a strategy earlier this year to continue to encourage the production of North Sea oil and gas while moving to a net-zero carbon future. The claimants behind the legal challenge, which include Greenpeace UK, Friends of the Earth Scotland, and, hope the review could spell the end for fossil-fuel production that relies on public subsidies.

Columns of note

Philip Stephens argues in the Financial Times that the high hopes for commitment during COP26 will only have meaning if they connect with local politics, which will ultimately decide how much actually gets done to limit global warming. Only if national governments manage to set the strategies and mobilise the resources to make the targets viable will the global ambition to eliminate fossil fuels be met, he concludes. (£)
Writing in City AM, Paul Simpson echoes concerns over the validity or credibility of net-zero targets set by companies around the world. He argues that to ensure corporations have plans in place to achieve that commitment, targets must be aligned with what climate science says is required, cover emissions across the whole value chain, and be validated and verified externally to avoid potential greenwashing.

Cartoon source: The Telegraph


What happened yesterday?

London stocks closed higher on Wednesday, boosted by the UK government’s decision to ease Covid-19 restrictions for US and EU arrivals to England. The FTSE 100 ended the session up 0.29% at 7,016.63, while sterling was stronger both against the dollar by 0.03% at $1.39 and versus the euro by 0.08% at €1.17.
Across the Atlantic, stock and government bond prices rallied after the Federal Reserve acknowledged improvements in the US economy. The S&P 500 share index closed flat for the day after reversing earlier losses, while the technology-heavy Nasdaq Composite index rose 0.7% after a rout in Chinese stocks.
In company news:
St. James’s Place rallied 5.6% after the wealth management business reported a jump in its first-half underlying cash result amid a sharp increase in funds under management.
Fresnillo was 6.95% higher as the precious metals miner said it was on track to meet its full-year targets as second-quarter silver production rose 18%.
Barclays closed up two per cent after the lender smashed first-half profit estimates as it released £700m in impairments, resumed dividends, and announced a £500m share buyback.
RHI Magnesita fell 11.88% after the refractories supplier’s interim earnings before interest, tax and appreciation came in marginally ahead of expectations but net debt came in higher.
ITV closed down 1.34%, even after the broadcaster reported a rise in interim profits and revenue and said it was “emerging from the worst effects of the pandemic”, with a recovery in advertising revenues.

What’s happening today?

Srt Marine Sys.

Amiad Water
Cmc Mkts
Discoverie Grp.
Gb Group
Intermediate Capital  
Johnson Matthey
Ms Intl.
Ovoca Bio
Palace Capital
Powerhouse Ener
Tate & Lyle
Tmt Investments

UK economic announcements
(07:00) Nationwide House Price Index
(09:30) Consumer Credit
(09:30) Mortgage Approvals
(09:30) M4 Money Supply

Int. economic announcements
(08:55) Unemployment Rate (GER)
(10:00) Industrial Confidence (EU)
(10:00) Economic Sentiment Indicator (EU)
(10:00) Business Climate Indicator (EU)
(10:00) Consumer Confidence (EU)
(10:00) Services Sentiment (EU)
(13:30) Continuing Claims (US)
(13:30) Initial Jobless Claims (US)
(15:00) Pending Homes Sales (US)

Source: Financial Times

did you know

People cut down 15 billion trees each year and the global tree count has fallen by 46% since the beginning of human civilisation. (source: Nature)

Parliamentary highlights

House of Commons

The House of Commons is in recess. The House will next sit on 6 September 2021.

House of Lords 

The House of Lords is in recess. The House will next sit on 6 September 2021.

Scottish parliament 

The Scottish parliament is in recess until 30 August but will be recalled on 3 August for Covid updates.

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