Vaccinated Hongkongers could save Cathay by leaving on a jet plane, if they're spared quarantine

ALL MY BAGS ARE PACKED, I'M READY TO GO

It is now 15 months since the SARS-CoV-2 virus reared its ugly head in Wuhan and badly disrupted lives across the globe. Initially, it was thought to be like the flu or pneumonia, and some figured it was likely to die out in the summer. But as we now know, the new bug was to remain bulletproof until a slew of vaccines came along.

A common complaint among friends has been having to deal with "the rules", which often have defied logic. We can go to the gym, but we can't exercise on the beach; we can overindulge in a busy restaurant (four-at-a-time, mind you) but have to repent online as no churches are open. As an alternative, you can have your nails done and confess your sins to the beautician. The most difficult thing to deal with, however, has been the removal of our freedom to travel, with progressive tightening of quarantine rules to the point where returning to Hong Kong from even Covid-free countries is almost impossible to stomach.

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Now, after a year of global lockdowns, new variants of the virus, and waves of infection, the light gleaming at the end of the tunnel has taken the shape of seven vaccines. Two of them were already available in Hong Kong until distribution of BioNTech's Comirnaty was suspended because of some wonky lids, and a third is on the way. So we should all be lining up, have a jab and get back to normal, right?

There has been an understandable level of reluctance to be early adopters of the vaccines that are available, and there is clearly a trust issue with some of them. Working out which one to get is also tricky: we've got the groundbreaking vaccine from BioNTech, the single-shot one from Johnson & Johnson if it becomes available, or we can wait for AstraZeneca to arrive in Hong Kong or take the plunge with Sinovac.

PROMISE THAT YOU'LL WAIT FOR ME

Typically, vaccines are unleashed on the populace after extensive testing that can go on for a decade or more. The Covid-19 vaccines, by contrast, have been rushed out in less than a year. It is understandable that there is some hesitancy, not helped by unpleasant vaccine side effects.

On the basis that I can hide at home and be antisocial, then what's the rush? I'm unlikely to catch anything at this rate, not even the flu, and with a mask and careful social distancing, I think I'm safe. Perhaps I need more of a push, an incentive, to go get the jab.

As far as incentives go, the only message presented from the government is to get the vaccine to "protect myself" - and I've been doing exactly that for a year already. Then there is the prospect of ending up in a Penny Bay quarantine cell, a thoroughly unpleasant experience I hear, which may serve as an additional reason to get vaccinated.

I think it is time we had a real incentive to promote vaccination in Hong Kong, and I propose it should be to let vaccinated Hong Kong residents travel and return without the harsh quarantine requirement currently applied. Let them go home.

In the longer term, proof of a negative Covid test and a vaccination record put down on a modern version of a "Carte Jeune" - a vaccination record that has served travellers since 1933 - should be sufficient to allow visitors to enter, sparing the holder the mental trauma and financial burden of three weeks in a hotel (or six weeks from Britain: three on the way and three when they arrive here).

DREAM ABOUT THE DAYS TO COME

Efficacy varies between vaccines, and the measure itself is difficult to compare as different vaccines were tested at different times and in different circumstances. But according to the Hong Kong government the BioNTech vaccine has an efficacy rate of 95 per cent, Sinovac is around 50-65 per cent, and despite the warning from Brazilian President Jair Bolsonaro, no one has turned into a crocodile yet from any of them.

The first jab starts to offer some modest protection from Covid-19, the second jab 21 days later really kicks things into gear, and 14 days after that we are at full throttle.

If we take a look at vaccinations around the world, as of March 17 the top five vaccinated countries in the world according to Bloomberg were Israel (everyone is done and partying), the Seychelles (same there), the UAE at 62 per cent, Maldives at 57 per cent and the UK at 40 per cent. Hong Kong was bringing up the rear at 3.1 per cent at the time, but is currently around 5 per cent.

Britain is setting a good example here and getting on with the jabs. With spring around the corner, their incentive is a promise of easing restrictions on pubs and restaurants and the likelihood of a summer holiday.

As of Friday, 29 million people in Britain had had their first dose of the vaccine and 2.8 million the second, so 44 per cent of the UK population are on the way to being covered. The vaccination rate suggests an additional 2 per cent are jabbed every seven days.

I have to use my fingers and toes for this one: the current infection rate in Britain according to the government is 57.1 per 100,000, or 0.57 per cent, or 1 in 1,751. With the BioNTech vaccine and its 95 per cent efficacy, I would have only a 5 per cent chance of catching it, or 1 in 20 - this is not strictly true but I hate stats and want to illustrate a point. So, I would probably have to meet 35,020 (1,751 x 20) people on my trip to set the temperature alarms off at Chek Lap Kok. That would be a tall order and I should rightfully be locked up - after all, I just want to visit my mum and dad.

I was pleased to read that Carrie Lam is looking to discuss "travel deals" with other countries again, but look where the Singapore bubble got us. New travel deals will take time and patience to negotiate, but an immediate move by the government to remove mandatory hotel quarantine requirements for vaccinated residents of Hong Kong coming back from a trip is surely an easy and sensible move to push the vaccine roll-out along, if the government truly believes the vaccines on offer here do work.

And by default, the quarantine requirement that is also applied to aircrews would be removed, which brings me to my next point: give Cathay a break before it is too late.

GIVE CATHAY A BREAK

With an easing of quarantines and a resumption of travel, there must be an investment angle. It would certainly get airline stocks moving. If Hong Kong was to move first, then that means our beloved Cathay Pacific, which reported an enormous loss of HK$21.6 billion in 2020 but kept the plates spinning by filling passenger planes with cargo, could get back to earning a crust. Cathay would not be alone, but I feel the most likely movers would be the regional heavyweights, rather than the budget airlines which may not have the finances to return their fleets to service.

In the absence of an ETF of Asian carriers to invest in, I think Cathay, Singapore Airlines, Philippine Airlines, ANA and JAL would make a decently representative basket of shares.

How airlines will perform in the longer term is unclear, and complex. The industry argues strongly that everything will come screaming back once people can travel, but I am not so sure. The other extreme possibility is that travel has changed forever, and that the events of the past year lead to a long-term glut of equipment and a severe shortage of pilots with long-term experience as they will have moved on.

Speaking for myself, I look forward to snuggling down in a Cathay seat to go see my folks in Britain, who were some of the first to enthusiastically get the vaccine in the hope that family and friends could visit again.

In the meantime, I look forward to the Hong Kong government thinking this one through as an incentive for people to queue up for a jab. At the very least, now that spring is here we should immediately open the beaches for some fresh air and exercise. I'll stay away from gyms, though; I never believed they were good for your health anyway.

Neil Newman is a thematic portfolio strategist focused on pan-Asian equity markets

This article originally appeared on the South China Morning Post (SCMP).

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