The impacts from Corona Virus will vary depending on the duration of the disruption and the extent of measures taken to contain the virus.
The governments' measures to stop people coming together are therefore critical to slow the spread of the disease. The Government has not released any detailed modelling to give us some guidance as to what to expect, other than the need to "flatten the curve".
So this week, we are applying our standard scenario modelling approach to considering potential outcomes from the corona virus.
To date, the number of infections in Australia have increased by 23% per day, meaning the infections are doubling every 3-4 days, a similar experience to many other countries. If left unchecked, 60% of Australian's will be infected by the 7th May (circa 15m people) and approx 150,000 deaths could result. This is dramatic and assumes that nothing is done to avoid it, but the maths are accurate.
The next 2 weeks are a crucial time for the containment of the virus.
We have modelled 3 scenarios which could play out over the next few weeks.
Our worse case estimate assumes that the Governments attempts to prevent the spread are effective but not for another 2 weeks, after which the rate of increase would reduce to 15% per day to the end of April and then to 10% by mid May and then tapering off. This would still see 6,300,000 infections by the end of June. This is unlikely as Government would continue to intervene with stricter containment measure ie neighbourhood lock downs, non essential services ceased, further travel restrictions etc.
If the Government's control measures are effective and the rate of infection can be reduced immediately to a 10% growth rate and then 5% by mid April and 2% from May, then Australia may see only 100,000 infections by the end of June. This is our best case estimate. This is possible but requires immediate adoption of effective and sustained containment measures.
Our base case estimate is for the rate of infection to continue at 23% growth for another 10 days and then to taper off more slowly, as the Government continues to tighten its grip on the spread of the virus. This would ultimately see 920,000 infections by the end of June. This scenario would still see significant widespread containment measures as well as highly targeted quarantine restrictions.
China's quarantines restriction (and potentially its media controls) have been successful in reducing the overall number of infections to 82,000 and rate of increase to just 0.5% per day. The well reported restrictions have at times appeared draconian and unlikely to be repeated in Australia, however it would appear that isolation has arrested the spread of the disease. Residents in areas without infections for seven consecutive days, are now permitted to go out "freely" as long as they do not gather in groups.
The two key indicators I am watching are ;
- whether Italy stabilises its outbreak in much the same way as China, and
- whether China's numbers increase again now that it is permitting residents to leave the houses.
Assuming these two indicators are positive, the chances of Australia's containment measures achieving our best case outcome will improve.
So whilst each of our Scenarios show the worst is over by June, it is likely that the restrictive social practices will ease over the following 3-6 months, but that strict international travel measures will remain in place for longer.
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