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Letter from... Madrid

21 April 2020

Elena Gallego, Account Director, SEC Newgate

Last weekend the Government of Spain announced new measures to be approved in Parliament. First of these was the extension of the lockdown until May 9. However, despite the extension, there are signs of hope as the remaining measures in place are being slowly relaxed.

It was announced that from April 27, Spanish children will be allowed outside for the first time in five weeks, although there is yet to be more detail of how this will be managed. Pedro Sánchez, the Prime Minister, also announced that the relaxation of the confinement will be gradual and by area, highlighting that it will be proceeded with great caution and warning that it will be retracted if the data indicates a rebound in figures of cases.

As in most of the countries around us, these new measures have given rise to controversy, fuelling the existing open fight between health and economic interests.

Some argue that the price of beating the Covid-19 is the shutdown in production and an "economic crisis" which is wreaking havoc on the economy and reaching a point of no return. Many are desperate to start reactivating part of the industrial and business fabric and gradually returning to normality, as is being seen in neighbouring countries.

Yet there is no guaranteed solution, in the face of such an exceptional situation, we have never experienced this before and have no blueprint to go by.

Norwegian economist, Finn Kydland, who won the 2004 Nobel Prize in Economics, has stressed that, in our country, keeping the human capital is the key to getting out of the coronavirus crisis: "If confinement does not destroy it, recovery will be quick". In any case, what remains unchanged is the word that defines our fight against the Covid-19 global pandemic: RESILIENCE - the ability of the human being to overcome adverse circumstances or traumatic events.