Sydney Readying to Emerge From 107-Day Covid Lockdown


Like thousands of eateries across Sydney, Bistecca, near the famous Opera House, went from packing in diners to “zero trade” in June as Australia’s biggest city endured one of the world’s strictest Covid lockdowns after an outbreak of the delta variant.

Now, with virus-related measures in Australia’s most populous state, New South Wales, to begin easing on Oct. 11, bookings are streaming in. “We are pretty much opening up to almost our full trading hours right off the bat,” said co-owner James Bradey. “It is going gangbusters.” 

He’s not the only one preparing to get back to business. NSW Premier Dominic Perrottet announced on Thursday that life is set to start returning to normal, after the vaccination rate for people over the age of 16 hit 70%. In the initial reopening stage, non-essential retail stores, pubs and gyms will be allowed to reopen to fully vaccinated patrons, with capacity limits. 

“We know that this is not just a health crisis, it’s an economic crisis, too,” Perrottet said at a press conference. “If we continue to make the effort and make the sacrifices that we have all been making, New South Wales will be open again.”

Schools will begin returning Oct. 18, with vaccines mandatory for teachers and masks required for staff and high school students, state education minister Sarah Mitchell said. Government schools would not mandate vaccines for students, she said.

The reopening comes despite the state recording 587 virus cases on Thursdsay, after the government abandoned its formerly strong commitment to a Covid Zero stance. This departure is dividing Australia as some other states remain steadfastly committed to keeping their borders closed.

As other parts of the world including the U.S. and U.K. were overwhelmed by Covid last year, life in Sydney went on largely as normal, bolstered by the state’s strict quarantine and contact tracing systems. The months of lockdown, spurred by an outbreak of the highly contagious delta variant in June, sent residents reeling in a city that had been seen as a rare global success story in halting the spread of the virus. Eventually, masks became largely mandatory outdoors. Police patrolled Sydney’s famous beaches.

Under the NSW roadmap, once the adult vaccination rate hits 80%, expected by the end of the month, a further relaxation of rules will be applicable for vaccinated residents, including mask mandates being scrapped for offices. A third lifting on Dec. 1 will include eased restrictions on venue capacity for offices and nightclubs, as well as freedoms for unvaccinated residents.

In November, Sydney will also start to welcome flights full of thousands of Australians who have been stranded abroad — and others who have been unable to leave the country since early 2020 — as strict international border controls begin lifting.

“We’re in the home stretch and we’re moving towards that line,” Prime Minister Scott Morrison told reporters Thursday, adding that “81% of over-16s right around the country are now first-dose vaccinated.”

Economy Reawakens

Pockets of Sydney’s economy managed to remain buoyant during lockdown. Still, the consensus among economists is that the initial bounce in the economy from restrictions easing will be slower than last year, since authorities who once dealt with few cases are trying to vaccinate the population sufficiently to allow people to live with Covid.

For economists, the government’s plan to conclude emergency payments two weeks after a state reaches the 80% vaccination level is likely to weigh on the recovery. Former recipients will be in limbo until they secure a job and regular income — and in the interim they’re likely to stay cautious. Further, one-fifth of the population will still be unvaccinated when restrictions lift, suggesting even the vaccinated will be wary when moving about.

Bill Evans, chief economist at Westpac Banking Corp., said that only when inoculations reach 90% and people return to earning regular salaries will the shackles truly lift from activity. 

“Maybe there’ll be an initial rush, but then I think things will be more cautious until we get to 90% and we get the very, very confident information around the hospitals that things are settling down,” he said. He predicted demand for workers will be so great that by the end of 2022 unemployment will be at 3.8%, a level unseen since 1975.

While plenty of Sydneysiders are planning activities as lockdown lifts, Evans sees a transition of a few months before the economy takes off — predicting economic growth of 1.4% in the final three months of the year after a 4% contraction in the third quarter.

‘Neighborhood Business District’

Still, Sydney’s central business district may not look like it did before the pandemic, with office workers now expecting to be able to work at home at least some of the time, said Ben Hamer, the Future of Work Lead at PricewaterhouseCoopers Australia. Just 10% of people want to return to the office full time, according to a survey from the firm.

The move to hybrid working would see the emergence of the “Neighborhood Business District,” Hamer said. But “hybrid working does not spell the death of the CBD. Instead, it will see vacancy rates drive down cost and allow a more diverse mix of tenants, previously priced out, to take up central occupancy.”

David Sokulsky, the Sydney-based chief executive officer of Carrara Capital, said workers in the financial center would be planning limited time off in the short term despite many accruing a bank of annual leave during the lockdown, as they try to get back to normal office routines.

Preet Maan, beauty therapist and owner of Pree Salon in Bondi Junction — close to the area that first triggered the outbreak — said she hasn’t worked for the duration of the lockdown and was excited to return. Still, she said, inoculation mandates and other restrictions could continue to hit business.

“When the lockdown happened we were the first ones to shut down, as beauty therapists, so zero income,” she said. “But I think some people are still scared, and a few of them, my clients, aren’t vaccinated — so I can’t allow them to come in.”