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Hungary has vaccinated more of its population than any other country in the European Union, but continues to be among the world's worst in the number of COVID-19 deaths per capita

By JUSTIN SPIKE Associated Press

March 29, 2021, 12:37 PM

3 min read

BUDAPEST, Hungary -- Hungary has vaccinated more of its population than any other country in the European Union, according to figures from an EU agency, but it continues to be one of the world's worst in the number of COVID-19 deaths per capita.

The Central European country has given at least a first dose of a vaccine to 21.6% of its population, according to the European Centre for Disease Prevention and Control, just ahead of the small island nation of Malta and surpassing the 27-member bloc's average of 12.3%.

But Hungary's high vaccination rate, a product of a procurement strategy that secured doses from China and Russia in addition to those provided by the EU, has been unable to slow a surge in the pandemic that has given it the highest two-week mortality rate per capita in the world, according to Johns Hopkins University.

Viktor Orban, Hungary's prime minister, has been critical of the speed of the EU's vaccine rollout, and pushed for his country to break with the bloc and secure vaccine contracts with eastern countries. Hungary was the first in the EU to approve Chinas Sinopharm and Russias Sputnik V vaccines, boosting supplies and making it an EU leader in the number of distributed doses per capita.

Were in a very good position, right at the head of the queue, and both the Russians and the Chinese are delivering in a timely manner, Orban said in a radio interview on Friday.

Last week, Hungary issued emergency approval to two more vaccines Convidecia, a jab produced by Chinese company CanSino Biologics, and Covishield, a version of the AstraZeneca vaccine produced in India bringing the total number of approved jabs to seven, the most in the EU.

But while officials have emphasized that only rapid vaccine deployment can bring an end to the pandemic Orban said on Friday that "vaccination is our primary, our only means of defense against the virus Hungary's good standing has been unable to alleviate a third wave that has led to record-breaking new cases and deaths.

As of Monday, more than 20,000 people had died of coronavirus-related causes in the country of fewer than 10 million inhabitants, giving it the third-worst death rate per capita in the world.

While other countries in the region have imposed tough lockdown measures to bring their own surges under control, Hungary on the weekend published plans to loosen pandemic restrictions in coming days despite the spiking numbers, an effort to restart the economy in a country which saw a 5.1% drop in GDP last year.

I have no doubt whatsoever that in Hungary well have a summer of freedom, Orban said Friday.

According to the plans published Saturday in the government's official gazette, nonessential shops will be allowed to reopen with capacity limitations, and an overnight curfew in place since November will be shortened by two hours. The new measures will take effect once 2.5 million people have received a first dose of a vaccine, a government minister announced, which is likely to occur some time next week.

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Hungary first in European Union for vaccinations, and deaths - ABC News

Posted: Apr 2, 2021 / 02:14 AM CDT / Updated: Apr 2, 2021 / 02:14 AM CDT

European Commission President Ursula von der Leyen listens to a question during an online news conference at the end of a EU summit at the European Council building in Brussels, Thursday, March 25, 2021. European Union leaders struggled Thursday to solve quarrels about the distribution of COVID-19 vaccine shots as they tried to ramp up inoculations across their 27 nations amid a shortage of doses, spikes in new cases and a feud with the United Kingdom. (Aris Oikonomou, Pool Photo via AP)

BRUSSELS (AP) The European Union is struggling to show complete coronavirus vaccination solidarity among member nations, after a week of negotiations over the distribution of extra doses exposed fissures on Friday.

Five EU nations that struggled most to get their vaccination drive going were given extra doses from an alliance of 19 other countries. Three nations werent part of the deal, however, showing the difficulties of compromise politics when COVID-19 cases are surging again.

At an EU summit last week, Austrian Chancellor Sebastian Kurz criticized the allocation of shots in the 27-nation bloc, saying that some countries were receiving more than their fair share at the cost of others. EU leaders failed to agree on a correction mechanism, leaving it to their EU ambassadors.

Late Thursday, a deal was reached on how to distribute an early batch of 10 million Pfizer-BioNTech doses with Bulgaria, Croatia, Estonia, Latvia and Slovakia receiving a proportionally large number of doses. Austria, along with the Czech Republic and Slovenia, didnt get additional shots.

We are grateful for the remarkable efforts and solidarity of fellow EU member states, Latvian Prime Minister Krijnis Kari said. He said the extra shots will bring us closer to our common goal a collective immunity across the EU.

Under the joint procurement program set up by the European Commission, doses are allocated on a pro rata basis, but some nations are taking less than their share. A large majority of EU members think the system is working well, but said some nations made a mistake to focus on AstraZeneca shots instead of diversifying their vaccine portfolios.

AstraZeneca shots are cheaper and easier to handle than vaccines from Pfizer-BioNTech or Moderna.

Overall, the EU continues to lag well behind nations like the United Kingdom and United States when it comes to vaccinations.

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EU nations struggle to full show vaccination solidarity - KLBK | KAMC | EverythingLubbock.com

In a common market, labor costs will look fairly similar across areas.

Sure, there will be some places with differing skill levels, different mixes of industry, and different levels of urbanization, thus leading to somewhat higher or lower labor costs. But over time, workers from lower-pay areas will tend to relocate to higher-pay areas and employers in higher-pay areas will tend to relocate to lower-pay areas. Thus, it's interesting that the European Union continues to show large gaps in hourly labor costs.

Here aresome figures recently released by Eurostat(March 31, 2021) on labor costs across countries. As you can see, hourly labor costs are up around 40/hour in Denmark, Luxembourg, and Belgium, but 10/hour or below in some countries of eastern Europe like Poland or the Baltic states like Lithuania. (For comparison, a euro is at present worth about $1.17 in US dollars. Norway and Iceland are not part of the European Union, but they are part of a broader grouping called the European Economic Area.)

Another major difference across EU countries is in what share of the labor costs paid by employers represent non-wage costs--that is, payments made by employers directly to the government for pensions and other social programs. In France and Sweden, these non-wage costs are about one-third of total hourly labor costs. It's interesting that in Denmark, commonly thought of as a Scandinavian high social-spending country, non-wage costs are only about 15% of total labor costs--because Denmark chooses not to finance its social spending by loading up the costs on employers to the same extent.

These differences suggest some of the underlying stresses on the European Union. Given these wage gaps across countries, tensions in high-wage countries about migration from lower-wage countries and competition from firms in lower-wage countries will remain high. The large differences in non-wage costs as part of what employers pay for labor represents some of the dramatic differences across EU countries in levels of social benefits and how those benefits are financed. Proposals for European-wide spending and taxing programs, along with the desire of higher-income EU countries not to pay perpetual subsidies to lower-income countries, run into these realities every day.

For comparison, here are some recent figures fromthe US Census Bureau on average employer costs per hour across the 10 Census "divisions." Yes, there are substantial differences between, say, the Pacific or New England divisions and the East South Central or West South Central divisions. But the United States is much more of a unified market than the European Union, both in wage levels and in the way non-wage labor costs are structured, and so the gaps are much smaller.

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The Spread in Labor Costs Across the European Union - BBN Times

Britain will join China in being locked out of research with the EU on cutting-edge quantum technology, such as new breeds of supercomputers, due to security concerns under a European commission proposal opposed by academics and 19 member states.

At a meeting on Friday, commission officials said the EU needed to keep control of intellectual property on key projects and that working with even close allies such as the UK and Switzerland opened up an unacceptable risk.

Under the UKs trade and security deal with its former partners, the government retained the right to pay into and participate in the EUs Horizon Europe research programme, a seven-year, 95.5bn (82bn) funding scheme. But the commission has now decided to curtail the type of projects in which the UK will be able to take part under a draft proposal discussed with the member states on Friday.

Representatives from Germany, Belgium, Spain, Ireland, Italy and the Netherlands were among the 19 member states who voiced concerns over the plan driven by Thierry Breton, the French internal market commissioner, and backed by the French government, among others.

You cant just put the UK and Switzerland in the same box as China and Iran, said one concerned diplomat. If this is what Bretons idea of strategic autonomy looks like, were in for one rough ride. The commission is pulling the rug underneath fruitful collaborations; they need to stay on the carpet.

But commission officials rejected arguments about the importance of working with trusted partners, sources said. The UKs attempt to break international law over the Northern Ireland border was raised by the commission as an example of why there was a lack of trust.

The new eligibility rules proposed by the commission include restrictions on work on a range of sensitive areas such as quantum computers, described in the commissions draft text for its Horizon research funding scheme as an emerging technology of global strategic importance.

In order to achieve the expected outcomes, and safeguard the Unions strategic assets, interests, autonomy, or security, namely, participation is limited to legal entities established in member states, Norway, Iceland, Liechtenstein. Proposals including entities established in countries outside this scope will be ineligible, the draft says.

According to the draft text, the goal of the changes is to make independent European capacities in developing and producing quantum computing technologies of strategic importance for future computing capacities and applications in security and dual-use technologies.

The decision has also been criticised, however, by senior academic institutions. A letter from Thomas Hofmann, president of the Technical University of Munich, written on behalf of institutions in Switzerland, Denmark, Luxembourg, Israel and the Netherlands, warns of a negative impact on future research.

Opening the scientific borders for the countries outside of the European Union should go hand in hand with strengthening collaboration with our closest partners and not undermine it, Hoffman wrote to the Portuguese presidency of the EU. Cooperation with the aligned countries is vital for the competitiveness of the European Unions economy. The latest proposal by the European commission to exclude longstanding and trustful partner countries like Switzerland, Israel and the United Kingdom from parts of the research programme is not in the interest of Europes research community nor the wider society and could be damaging for the international cooperation.

Hoffman adds: We are deeply concerned that the exclusion of aligned European countries with a long record of cooperation and excellence in research and innovation from parts of the programme will have negative impacts on European institutions and their capability to develop key digital, enabling, and emerging technologies.

Discussions are expected to resume between the member states and the commission on 19 April.

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EU plan threatens British participation in hi-tech research - The Guardian

Photographer: Bloomberg Daybreak

Photographer: Bloomberg Daybreak

You can almost hear the relief in Brussels that the latest financial crisis, the blowup of Bill Hwangs family office Archegos, has passed it by. That doesnt mean the next one will.

The European Union is eager to take work from the City of London after Brexit, but it needs toappreciate that greater exposure to the financial sector means bigger risks. Europes approach of setting up finance hubs in several locations will magnify the dangers rather than prevent them.

As with the 2008 Lehman Brothers collapse, the splintered approach to trying to manage themassive margin call on Archegosmade matters worse.Deutsche Bank AGdodged this bullet (mimicking Goldman Sachs Group Inc. and others) by a swift disposal of $4 billion of available-for-sale collateral from its prime brokerage exposure to Hwang.Credit Suisse Group AG and Nomura Holdings Inc.were less fortunate. Two of Japans megabanks have also revealed exposure. The collateral they hold may now both be much lower in value and less liquid, takingmuch longer to offload, with commensurate larger losses.

The scale of the Archegos blowup looks manageable for the finance system, even if does leave a few bank victims, but imagine something similar happening in the infinitely bigger interest-rate market at some point.And then imagine clearing houses in different European cities trying to manage the fallout collectively.

While there were reported attempts to broker a club deal on Archegos and to undertakea collective controlled explosion of the positions, trust among the investment bankerswas absent. It became devil take the hindmost. Its for exactly this reason that centralized clearing houses evolved afterthe Lehman debacle to pool the counterparty risks of dealing securities across the financial system.

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The London Clearing House, part of the London Stock Exchange Group Plc, clears more than 90% of global interest-rate swaps because centralizing the risk makes it simpler to assess. The EUs desire to see not just euro-denominated clearing but muchof the wider financial activity in Europe switch away from London will have consequencesfor financial stability. A future crisis would be far harder to unravel if exposures between banks weretied up in several different clearing exchanges.

Which clearing house would have the rights to which collateral? Have no lessons been learnedfrom the collapses of Lehman orMF Global, which have tied up conflicted assets for over a decade?There are even echoes of the LTCM collapsenearly a quarter of a century ago.

There are sound reasons why London has become the European financial center. That doesnt mean some business, and particularly control of European government debt,shouldnt naturally drift across to the continent, but it does come with concomitant risks which need tobe addressed.Could the EU handle another large-scale financial crisis if it cant even agree how to distribute vaccines?

With lockdowns imposed again across the EU, a stuttering vaccine rollout and a potential block to Europes pandemic recovery fund from the German constitutional court, there are warning signs something ECB Chief Economist Philip Lane outlined in a recent blog. The prospect of another test of Italian bond yields is always present.

While the Archegos margin call was in the tens of billions of dollars, there are many trillions of euros of interest-rate exposure in the EU, much of it at negative yields. Taking back control of your financial system means being able to take the rough with the smooth. A disparate approach might failthat test.

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

To contact the author of this story:Marcus Ashworth at mashworth4@bloomberg.net

To contact the editor responsible for this story:James Boxell at jboxell@bloomberg.net

Before it's here, it's on the Bloomberg Terminal.

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Archegos Carries Explosive Warning For European Union's Financial Ambitions - Bloomberg