Why Omicron variants BA.4 and BA.5 are causing fresh U.S. outbreaks
More infectious than past strains, these subvariants can also more easily escape antibodies from vaccines and previous infections.
Two Omicron subvariants are now causing more than half of new coronavirus infections in the United States—and both are very good at dodging antibodies in people who have been vaccinated and boosted, as well as in people who had a previous COVID-19 infection.
First spotted by scientists in South Africa in January and February this year, the BA.4 and BA.5 subvariants became dominant in the U.S. in less than two months, according to this week’s estimates from the U.S. Centers for Disease Control and Prevention. For the week ending on June 25, BA.4 accounted for 15.7 percent of new cases, while BA.5 was responsible for 36.6 percent.
“BA.4/BA.5 certainly is more infectious compared to previous Omicron variants,” says Yunlong Richard Cao, an immunologist at the Biomedical Pioneering Innovation Center at Peking University in Beijing, China. Cao’s research shows that one of the most concerning traits of these variants is their ability to evade the immune system and break through herd immunity.
That’s of particular concern because almost a quarter of the eligible U.S. population has not received a vaccine of any kind. And for those who have, even a full dose doesn’t seem to sufficiently block the new variants.
“Two doses do not offer much in terms of protection against BA.4 and BA.5,” says Shan-Lu Liu, a virologist at the Ohio State University in Columbus. A little over half of U.S. adults have received their first booster dose, but more than 30 percent of those over 65 have not, and they are at high risk for COVID-19 infection or reinfection.
Despite this concern, experts stress that vaccines and boosters are not completely ineffective: “Immunity from current vaccines is still expected to provide robust protection against severe disease, hospitalization, and death,” says Dan Barouch, an immunologist at Harvard Medical School in Boston.
How much do these subvariants dodge immunity?
In addition to Cao’s work, multiple studies are showing that BA.4 and BA.5 excel at dodging antibodies.
“Following [even a] third dose of the Pfizer vaccine, BA.4 and BA.5 escaped from vaccine-induced and infection-induced antibodies more effectively than prior Omicron variants,” says Barouch. His research also shows that BA.4 and BA.5 can effectively dodge antibodies created after Omicron breakthrough infections in vaccinated people.
Liu’s research shows that people who received just two doses of either mRNA vaccine did not produce sufficient antibodies to block any Omicron subvariant, including BA.4 and BA.5. While a booster dose significantly improved protection, it was still less efficient against BA.4 and BA.5.
And in a study that is not yet peer reviewed, Alex Sigal, a virologist at the Africa Health Research Institute and at the University of KwaZulu-Natal in Durban, South Africa, found that antibodies from a previous infection with the original Omicron BA.1 strain do not protect against BA.4 and BA.5 infection in either partially vaccinated or unvaccinated people.
What makes BA.4 and BA.5 different?
While BA.4 and BA.5 are almost identical to each other, BA.5 spreads even faster than its “twin” and all other Omicron variants, according to the data from the United Kingdom.
The two variants differ from the Omicron BA.2 subvariant by just six mutations within the spike protein—the part of the SARS-CoV-2 virus that anchors to receptors on human respiratory cells and allows the virus to enter.
Kei Sato, a virologist at the University of Tokyo, has shown that one of these mutations helps the virus anchor to human cells and replicate better.
“It’s quite a useful sort of mutation for the virus,” says Ravindra Gupta, an immunologist and infectious disease specialist at the University of Cambridge in the U.K. Sato and Gupta’s work has shown that this mutation weakens the potency of existing antibodies.
Sato’s unpublished research also indicates that in hamsters, BA.4 and BA.5 target lung tissues more efficiently than previous Omicron variants. But it’s too early to say whether BA.4 and BA.5 can cause more severe diseases in humans, says Olivier Schwartz, a virologist and immunologist at the Pasteur Institute in France.
In South Africa, the surge in infection caused by BA.4 and BA.5 did not lead to as many hospitalizations as the original Omicron wave, says Tulio de Oliveira, a bioinformatician at Stellenbosch University in South Africa who discovered the Omicron variants.
“We do know that it didn’t really drive much of a severity wave in South Africa, which is somewhat reassuring,” says Gupta, “although they’re a much younger population.”
In Portugal, on the other hand, where BA.5 now accounts for almost 90 percent of infections, hospitalization and intensive-care admissions have risen during the past six weeks, mainly among people ages 60 years and older.
What’s next for the vaccines?
Both Moderna and Pfizer have developed new types of “bivalent” boosters that are based on both the Omicron BA.1 subvariant and the original version of SARS-CoV-2 used in the approved shots.
It’s unclear how the updated bivalent booster will fare against BA.4 and BA.5, since both the Moderna and Pfizer boosters generated a weaker antibody response to these subvariants than to BA.1. The U.S. Food and Drug Administration has admitted that the bivalent booster is “already somewhat outdated.”
Regardless, an FDA advisory panel recommended on Tuesday to start using the updated COVID-19 booster shots in the fall.
Along with improvements to the vaccines, preventive strategies such as social distancing, avoiding crowded indoor places, and masking remain very effective at reducing infection risk and decreasing the likelihood that new immunity-evading variants will evolve.
“Waning vaccine immunity and decreased masking are also major contributors to the continued circulation of the virus,” says Barouch.
“We just have to be a bit careful in our daily life,” says Sigal. “COVID-19 is not done.”
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Is Omicron really less severe than Delta? Here’s what the science says.
This variant is more transmissible. So how do you protect yourself? And what are the implications for vaccines, masks, hygiene, and social distancing?
Is Omicron really causing less severe disease than Delta?
Multiple lines of evidence from various parts of the world suggest that the Omicron variant causes a less severe form of COVID-19. In South Africa, where Omicron was first detected in November 2021, a private health insurance administrator reported in mid-December that adults with Omicron were 29 percent less likely to be hospitalized, compared with adults infected several months earlier. In the U.K., the rate of hospital admission among people who went to the emergency room with Omicron was a third of what it was for Delta, according to a summary of research from the U.K. Health Security Agency released on December 31, 2021.
As of early January, U.S. adults with Omicron were less than half as likely to visit the emergency room, be hospitalized, or be put on a ventilator, according to preliminary work by researchers from Case Western Reserve University School of Medicine. Their study, which has not yet been peer-reviewed, examines data for more than 14,000 patients and accounts for their vaccination status and any pre-existing conditions.
Does severity differ based on age or preexisting conditions?
Omicron appears to be less severe than Delta in all age groups, even in adults older than 65 and in children too young to be vaccinated, according to the Case Western study. Still, as with other health issues, age remains a factor, del Rio says. “For any disease, if you’re older, you’re going to do a lot worse,” he says.
People with underlying conditions or compromised immune systems also remain more vulnerable, as do people who are unvaccinated. Although current vaccines are less effective at preventing symptoms from Omicron than from Delta, the U.K. report found that people who were fully boosted were up to 88 percent less likely to be hospitalized with Omicron compared with unvaccinated people. Hospitals around the country report that unvaccinated patients make up the majority of people now in intensive care units.
Regardless of age or health status, people infected with Omicron can feel terrible even if they don’t have to go to the hospital, and the variant continues to hospitalize and kill many people, emphasized Tedros Adhanom Ghebreyesus, director-general of the World Health Organization, in a virtual press conference last week.
Why is Omicron dangerous if it’s less severe than Delta?
Omicron is between two and four times more contagious than Delta, according to a Danish study that has not yet been peer-reviewed. It’s also better at evading the antibodies triggered by vaccines, which is why it’s causing more breakthrough infections. As a result, more people are getting sick and showing up at hospitals, where more staff are calling in sick, del Rio says.
Unlike previous variants, Omicron appears unable to infect lung cells as efficiently, which in turn makes it less damaging and the symptoms less severe. Viral loads are significantly lower in the lungs of Omicron-infected rodents in some studies. But in the upper respiratory tract, which includes the nose and sinuses, Omicron seems to replicate more than a hundred times faster than Delta.
That mix of changes—the preference for the upper airway, better immune invasion, and high transmissibility—reflects how evolution pushes the virus to ensure its own future by replicating and spreading even when that does not make individuals sicker.
“It kind of doesn’t matter to the virus, once it’s replicated, whether that person lives or dies as long as it can get to the next host,” Moore says. “It’s all about genome replication.”
What do these changes mean for at-home testing?
All strains of the SARS-CoV-2 virus can infect cells in the mouth, and Omicron may be particularly abundant there compared with other variants, early evidence suggests. In one study that has not yet been peer-reviewed, researchers in South Africa tested 382 people who were not sick enough to be hospitalized but still had COVID-19 symptoms. They found that in those with Delta, nose swabs were more accurate, but for Omicron, saliva tests worked best.
Other studies also suggest that rapid antigen tests that rely on nasal swabs might be especially slow to identify infections with Omicron. In one study posted last week that has not yet been peer-reviewed, researchers looked at samples from 30 people who tested positive for COVID-19 around the United States during outbreaks in early December. For most cases of Omicron, PCR tests showed positive days before a rapid test did. Those results echo what people have been reporting on social media, says study coauthor Anne Wyllie, a medical microbiologist at the Yale School of Public Health in New Haven, Connecticut.
“It’s not what’s been authorized by the FDA, and it’s a very tricky topic to speak out on because of that,” she says. That’s why many other experts are hesitant to recommend the off-label use. While throat swabs might eventually become part of the testing equation, rapid tests were designed for noses, not throats, says Jill Weatherhead, an infectious disease expert at the Baylor College of Medicine in Houston.
“At this point, the recommendation would be to continue to do the test as they’ve been designed to be done until further testing has been shown that it’s effective,” Weatherhead says.
Does double masking help protect against Omicron?
The Centers for Disease Control and Prevention does not currently recommend double masking or the use of specific masks. But other countries, including Austria, France, and Germany, have upgraded their guidelines to recommend medical-grade varieties, such as surgical masks or N95s. And some U.S. experts have spoken out in favor of higher quality masks.
One study found that, if fitted correctly, N95s block an average of 90 percent of exhaled particles, while surgical masks blocked 74 percent. That can make a substantial difference in community spread. In Bangladesh, an intervention boosted the percentage of people wearing surgical masks in some villages from 13 percent to 42 percent. Researchers then found an 11 percent drop in COVID-19 symptoms, with bigger gains in older groups. Evidence on cloth masks is mixed, but wearing a cloth mask over a surgical mask can block more than 85 percent of cough particles, according to some research.
Do we still need to disinfect surfaces, stand further away from each other, or alter any other aspect of personal hygiene?
Like prior variants, Omicron is primarily airborne, and experts agree that wiping down surfaces is probably more trouble than it’s worth. “Transmission from surfaces is low,” Wyllie says. Given “the time, energy, money, resources and mental health put into that kind of concern—you’re better spending that on hand-washing, social distancing, and mask-wearing.“
Also, the six-foot rule is more of a reminder that being close to an infected person increases the risk of transmission, says Abraar Karan, an infectious diseases doctor at Stanford University in Palo Alto, California.
“Transmission can happen beyond six feet of distance, for sure,” he says. “However, distance makes transmission less likely, as aerosols get diluted with further distance.” Your risk also depends on ventilation, what kinds of masks people around you are wearing, and other factors.
Is long COVID still a risk when it comes to Omicron?
It’s too soon to know, and it likely will be months before researchers can tell if Omicron causes symptoms that stick around for the long-term. But some experts are hopeful that long lasting consequences will be less common because of Omicron’s tendency to stay out of the lungs, and because more people are getting vaccinated, which can help prevent infections and lower risk of developing a number of symptoms. “I would suspect we will still see cases,” Wyllie says. “But because we have far more people now vaccinated, I am hoping we see less long COVID-19.”
The wonky-spiked variant
Omicron looks ominous. How bad is it likely to be?
Much has been learned about how to treat covid-19 and how to live with it
Virologists will tell you that predicting how a new virus might evolve is a fool’s errand. Predicting that it will evolve, though, is money in the bank. The virus that causes covid-19, sars-cov2 is no exception. Since the first copy of its genome was published on January 10th, 2020, sequenced from a sample collected in Wuhan days earlier, some 5.6m sars-cov-2 genomes have been added to Gisaid, a database. They have been arranged into 23 clades—groupings with a distinct common ancestor which differ from the original sequence and from all the others in at least one particular. Each clade has had the chance to outcompete the other versions, and almost all have failed. Most differences do not make much of a difference. Then again, some do—spectacularly so.
Between November 15th and 25th the number of new cases of covid in South Africa jumped from fewer than 400 a day to more than 2,000. Sequencing showed that a large number of these were down to a variant initially known as B.1.1.529, and subsequently designated Omicron. In genomic terms, Omicron is wildly different from any other variant seen to date.
The nature of its differences suggested, in theory, that it might be better at getting into human cells than its relatives were. It might also be better at avoiding the attention of antibodies from vaccination or an earlier infection. Virologists had long thought that a variant which combined both those advantages “would be a pretty dangerous thing”, according to Noubar Afeyan, a co-founder of Moderna, one of the manufacturers of mrna vaccines against sars-cov-2. But they also thought it was unlikely. Now “Omicron is exactly that”, Mr Afeyan says. Its mutations and its apparently rapid spread added up to something potentially scary.
The who has warned that the new strain carries a “very high” risk of causing surges in infection all around the world. As yet, though, such a surge has been seen only in South Africa, and things may stay that way. It is possible that the surge had other causes and that any variant around at the time would have spread. Or some factor that favours the variant in South Africa may be absent everywhere else. There is precedent for this. Southern Africa suffered a wave of the Beta variant at the end of 2020, but it never became established elsewhere. Alpha swept across Europe but never became established in southern Africa. The reasons a variant spreads in one place and not another are, like much of the rest of evolution, thought to be largely environmental. For sars-cov-2 a crucial part of the environment is the immune system, and immune systems are different all over the world. How different genes, endemic infections, general levels of health, microbiome, and more end up stopping one variant from displacing another is largely uncharted territory.
But not all variants stay local. First detected in India roughly a year ago, Delta displayed a level of transmissibility that saw it outcompete other strains almost everywhere, establishing itself as the dominant strain and often causing new waves of disease as it did so.
It is the possibility that Omicron might now outcompete Delta—either through being inherently more transmissible, by being better at overcoming prior immunity, or a bit of both—that has the world on edge and may yet see markets lose their cool. Many countries have banned or restricted travel from southern Africa. Some, like Israel and Japan, have banned all foreigners from coming in. Despite this, by December 2nd over two dozen countries had reported the presence of the Omicron variant within their borders (see map). That seems to suggest the cat is already out of the bag; if Omicron has the ability to displace Delta, it is probably already in a position to do so.
Western countries where double vaccination is common are providing more booster shots. That makes sense even if it turns out that the antibodies the immune system generates in response to existing vaccines are not as well-tailored to Omicron as they were to earlier variants. The boosters will not make better antibodies, but they will spur the body into making more of them, at least for a while. Studies have found that the quantity of antibodies against sars-cov-2 matters even if the antibodies are not specific to the variant. Vaccine-makers are looking at how to change their offerings to deal with the newcomer more effectively—and trying to work out whether they actually need to.
At the genetic level, Omicron differs from the original Wuhan version in more than 50 places. But it is also very different from other recent versions of the virus (see chart 1). Its closest relatives are versions of the virus first spotted at least a year ago and rarely sequenced since. There are three possible explanations for this.
One is that Omicron’s ancestor managed to circulate for almost a year without being detected by the genomic-surveillance apparatus, and while picking up many more mutations than any other variant has. This seems unlikely. Another is that Omicron’s ancestor jumped into and out of an animal population over the past year, picking up its large number of mutations there. Many of the mutations are completely new, not seen before in any variant, lending some credence to this hypothesis.
But it is the third possibility that seems most likely, not least because similar things have been documented before. This is for the ancestral sars–cov-2 to have infected someone with a compromised immune system. Because such people are unable to get rid of it, the virus can evolve inside them for months, accumulating mutations as it does so. Their bodies provide what Sharon Peacock of Cambridge University calls an “evolutionary gym” on which variants can both build up their strength and learn some new tricks.
Omicron you’re so fine
The most worrying of Omicron’s mutations are in the gene that describes the spike protein. This is the tool the virus uses to bind itself to cells and enter them. Delta probably owes its greater transmissibility in part to the fact that it sticks better to cells. Its mutations produce a spike in which nine of the amino acids in the 1,273-amino-acid-long chain from which the protein is made are distinctively different. The mutations in an unnamed variant called C.1.2, which boasted one of the most mutated spike ever seen until the past few weeks, changed 14 of the amino acids. Omicron’s mutations change 35; ten of the mutations have never been seen in any of the variants of concern to date.
A mutated spike is not necessarily a better spike. C.1.2 derived no benefit from having more mutations there than any other variant—it never spread all that far and may now be extinct. But the locations of Omicron’s mutations make it worrying. “If you look at the sequence on paper, because of the number of mutations and where they are, it is very concerning because of the impact on neutralizing antibodies,” says Susanna Dunachie, an immunologist at the University of Oxford.
Some other mutations are worrying, too. After binding to a cell, the spike breaks in two at a juncture called the furin cleavage site, allowing the viral genome to get inside. Ravindra Gupta of Cambridge worries that Omicron’s three mutations close to this site will give it an advantage in replication similar to that enjoyed by Delta. Another mutation may allow it to confuse the way in which the immune system uses a chemical messenger called interferon.
Computer modeling using AlphaFold, a program developed by DeepMind, a British artificial-intelligence research company owned by Alphabet, to predict the shape of Omicron’s spike also suggests that antibodies will stick to it at least a bit less well, says Colby Ford, a computational biologist at the University of North Carolina at Charlotte. Experimental approaches that compare the effect of the individual mutations involved tend to agree—but the complexity of protein-folding means that the effects of different mutations are not strictly additive; some will reinforce each other, others will cancel each other out. The experiments that should provide a clear idea of what is going on will be those which pit a wide range of antibodies against the whole protein as found on virus particles. Such work is going on all over the world, nowhere more urgently than in the laboratories of the various vaccine developers.
Ugur Sahin, the boss of BioNTech, one of the two companies that have developed mrna vaccines against the virus, accepts that because the vaccines get cells to make spike proteins according to the recipe used in the earliest genomes to be sequenced, the neutralising effect of vaccine-elicited antibodies will be lower for Omicron. But he adds that it is not clear how great the reduction will be, and points out that immunological protection is not provided by antibodies alone.
Vaccines engage the immune system’s T-cells as well. These are lymphocytes that respond not just to finished proteins, as antibodies do; they also recognise protein fragments. Because 97% of Omicron sequences are identical to the original virus found in Wuhan, Dr. Sahin says, these T-cell responses should still work. He expects that most fully vaccinated people with boosters should at worst fall only moderately ill if infected with Omicron. Alessandro Sette, an immunologist at the La Jolla Institute for Immunology, and his colleagues have shown that T-cells preserve 93-97% of their targeting capacity when faced with a new variant.
Nonetheless, BioNTech is working on a vaccine using mRNA that describes the Omicron spike. So is Moderna. Both companies have been down this road before, developing tailored vaccines against Beta and Delta. They did not go into production because they did not, in the end, prove necessary; the original vaccines held up well. Whether the same looks likely to be true for Omicron should be known, the companies say, in a matter of weeks.
The makers of vaccines that use other approaches to their trade are also exploring the possibilities of doing something specific to Omicron; but the mRNA technology is inherently quicker to work with, and being first on the market would be a huge advantage. Morgan Stanley, a bank, reckons that both firms could make about 6bn booster shots next year.
When studying vaccines against Beta and Delta, both firms worked to develop procedures that would allow modified versions of their jabs to be approved quickly by regulators. Dr Sahin says that if a new vaccine does turn out to be needed, his firm could deliver it within 100 days: the estimate includes regulatory approval. The time taken to change production procedures, though, would make it unlikely that substantial quantities of an Omicron-targeting vaccine could be produced before the middle of 2022. Changing a production line from one vaccine to another also means a halt to vaccine output on that line.
Economic immunity
The fact that old vaccines will still work to at least some extent and new ones are possible is reassuring. But if through a mixture of high transmissibility and immune evasion, Omicron does prove better at infecting, and reinfecting, the world, then some bumpy months could lie ahead, not least for the economy. Jerome Powell, the chairman of America’s Federal Reserve, has suggested that if people became scared of the variant they might drop out of the labour force. That could worsen labour shortages and lead to wage growth. If it were to hit Vietnam, or even China, hard, the supply-chain crunch could worsen.
Analysis by Goldman Sachs, a bank, combines data on mandated social-distancing measures and the amount of adherence they meet with into an “effective-lockdown index”. The previous two significant variants, Alpha and Delta, caused lockdowns to tighten, but to a significantly lower level than in early 2020 (see chart 2). In the past nine months, only a handful of countries have locked down as stringently as they did in 2020.
Developed-world governments are less willing to impose forceful measures, in part because vaccines have substantially weakened the link between cases and hospital admissions and death. Better drugs and treatments have also helped, and new antiviral pills from Merck and Pfizer should improve things further—though existing therapies based on mass-produced antibodies may be less effective when faced with Omicron’s spike.
They have also found that some measures, including curfews and school closures, bring few benefits at a high cost; they are thus no longer part of the toolkit. More policymakers also acknowledge that covid is becoming endemic, raising the bar for interventions. In America, many state governors have promised never to implement lockdowns again. On November 30th the British government resisted suggestions from their medical advisers that people should limit social contacts.
Public compliance with restrictions has also faded. People are less scared of the virus or more resigned to their fate. The Netherlands and Austria are technically in lockdown, but people are about twice as mobile as they were at the beginning of 2021, according to an analysis of Google mobility data on visits to sites of retail and recreation, workplaces, and public-transport stops carried out by The Economist.
And what social distancing still goes on, either because of rules or choices, has less economic cost than it used to. People can work more efficiently from home because they have invested in technologies that enable them to improve their virtual office. Businesses are also better able to cope with lockdowns. Retailers have improved their online offerings, whereas restaurants and bars do more takeaway. In the middle of 2020, a ten-point tightening in Goldman’s index provoked a 6% decline in GDP. But the effect weakened in subsequent months; it now sits at about 2%.
In the coming days and weeks, Omicron will show its true colours. It could prove to be extremely dangerous. But in the two years since people in Wuhan started to come down with a strange new disease, much has been learned about sars–cov-2, how to treat it and how to live with it. That, at least, should be some comfort. ■
Countries are scrambling to stop a new covid variant
How big a threat is Omicron?
IF THERE is one lesson the covid-19 pandemic has taught the world, it is that acting early pays off. Wait a week for better data on which to base a decision and you can find yourself down a path of no return, with cases rising steeply. So when news emerged on November 25th in South Africa of a worrying new variant of the SARS-CoV-2 virus, many countries in Europe and elsewhere banned travel from countries in southern Africa within a day. On November 26th the World Health Organisation named the variant Omicron, a Greek-alphabet designation which, as a rule, it reserves only for “variants of concern”.
The concerns with Omicron are indeed many. The biggest is that it may have the ability to spread more easily than Delta, the variant that dominates cases of covid around the world today. If so, Omicron could supplant Delta within months. In that case, Omicron would cause bigger outbreaks that flare up faster than Delta and are harder to stop. Another worry is that today’s vaccines and drugs against covid may be less potent against Omicron and may therefore need to be redesigned.
At the moment, these are only fears based on hints drawn from early data on Omicron emerging from South Africa. Whether these fears will come to pass is far from certain. It will take weeks or even months before there is solid evidence from laboratory and other studies on how much of a threat Omicron really poses. In the meantime, many countries are trying to stop the new variant from arriving on their shores inside travelers—and rightly so. They are buying time to prepare for the worst while hoping for the best.
The first signs that a new variant may be spreading emerged in South Africa earlier this week, when covid infections increased suddenly and sharply, from fewer than 300 cases on November 16th to more than 1,200 on November 25th. The vast majority of these infections were in one province, Gauteng, which has Johannesburg as its capital.
At first, it seemed as if the infections were linked to one big super spreading event, such as a student party. That would be the sort of outbreak in which a new variant erupts briefly and then dies away. But new cases in Gauteng instead became more dispersed over time. That prompted South African scientists to look at the genomic sequence of viral samples, which is how they spotted the new variant.
With mutations, quantity is not necessarily quality. But several of those in Omicron have been found in studies of other variants to make the virus more infectious. Some of them make it easier for SARS-CoV-2 to evade the body’s innate immune response (the immune system’s first reaction), others weaken its antibody response (a defence mechanism built as a result of prior infection or vaccination). Various combinations of Omicron’s mutations are present in all of the variants of concern to have emerged so far.
If the mutations in Omicron turn out to make covid vaccines less potent, the jabs may have to be tweaked. On November 26th Pfizer and BioNTech, makers of the covid jab that is most widely used in Western countries said that they would be able to rework their mRNA vaccine within six weeks and ship the first batches within 100 days. The mutations in Omicron do not appear to be a threat to the efficacy of antiviral medicines for covid, but they could defeat some antibody therapies, which are given to people unable to mount an immune response.
Even if Omicron comes to dominate in South Africa, it is unclear that it will displace Delta in other parts of the world. South Africa had a wave of the Beta variant that did not become established elsewhere. Likewise, Alpha, which swept across Europe, never became established in South Africa. These patterns may have to do with variations in demography and with common infections that interact with SARS-CoV-2 in poorly understood ways.
All in all, lots about Omicron remains to be discovered. What is clear, however, is that the world is better placed to resist it than when Delta emerged in India at the end of last year. By the time Delta had been identified as a variant of concern, it had already spread to many parts of the world, eventually seeding wave after wave of the pandemic. It remains to be seen whether Omicron poses a global threat on such a scale.
Danger ahead
What the Omicron variant means for the world economy
Look to China for the likeliest source of a growth slowdown
A little more than a year after the first success of a covid-19 vaccine in a clinical trial, a sense of dread has struck much of the world. The Omicron variant of the coronavirus, first publicly identified on November 24th, may be able to circumvent the defenses built up by vaccination or infection with covid-19. The World Health Organisation declared that Omicron poses a “very high” global risk. The boss of Moderna, a vaccine-maker, warned that existing jabs may struggle against the heavily mutated new variant. Faced with the ghastly prospect of yet more lockdowns, closed borders, and nervous consumers, investors have reacted by selling shares in airlines and hotel chains. The price of oil has slumped by roughly $10 a barrel, the kind of drop often associated with a looming recession.
As we explain this week it is too early to say whether the 35 mutations on Omicron’s spike protein help make it more infectious or lethal than the dominant Delta strain. As scientists analyse the data in the coming weeks, the epidemiological picture will become clearer. But the threat of a wave of illness spreading from one country to the next is once again hanging over the world economy, amplifying three existing dangers.
The first is that tighter restrictions in the rich world will damage growth. On the news of the variant, countries scrambled to block travellers from southern Africa, where it was first identified. Israel and Japan have closed their borders entirely. Britain has imposed new quarantine requirements. The pandemic abruptly ended a freewheeling era of global travel. Restrictions were being eased this year, but the past week has shown that gates are slammed shut much faster than they are opened.
A lopsided economy fuels the second danger, that the variant could raise already-high inflation. This risk looms largest in America, where President Joe Biden’s excessive fiscal stimulus has overheated the economy and consumer prices rose by 6.2% in October compared with the previous year, a three-decade high. But inflation is also uncomfortably high elsewhere, at 5.3% globally, according to Bloomberg data.
You might think Omicron would lower inflation, by depressing economic activity. In fact it could do the opposite. Prices are rising in part because consumers are bingeing on goods, bunging up the world’s supply chains for everything from Christmas lights to trainers. The cost of shipping a container from the factories of Asia to America remains extraordinarily high. For overall inflation to recede, consumers need to shift spending back towards services like tourism and eating out. Omicron may delay this. The variant could also trigger more lockdowns in key manufacturing nodes such as Vietnam and Malaysia, aggravating supply glitches. And cautious workers may put off their return to the labour force, pushing up wages.
That may be one reason why Jerome Powell, the chairman of the Federal Reserve, indicated on November 30th that he favours monetary tightening. That stance is right but brings its own dangers. The spillover effects could hurt emerging economies, which tend to suffer capital outflows and falling exchange rates when the Fed tightens.
The final danger is the least well appreciated: a slowdown in China, the world’s second-biggest economy. Not long ago it was a shining example of economic resilience against the pandemic. But today it is grappling with a debt crisis in its vast property industry, ideological campaigns against private businesses, and an unsustainable “zero-covid” policy that keeps the country isolated and submits it to draconian local lockdowns whenever cases emerge. Even as the government considers stimulating the economy, growth has dropped to about 5%. Barring the brief shock when the pandemic began, that is the lowest for about 30 years.
If Omicron turns out to be more transmissible than the earlier Delta variant, it will make China’s strategy more difficult. Since this strain travels more easily, China will have to come down even harder on each outbreak in order to eradicate it, hurting growth and disrupting supply chains. Omicron may also make China’s exit from its zero-covid policy even trickier, because the wave of infections that will inevitably result from letting the virus rip could be larger, straining the economy and the healthcare system. That is especially true given China’s low levels of infection-induced immunity and questions over how well its vaccines work.
Vexing variants and worrying weeks
It is not all gloom. The world will not see a re-run of the spring of 2020, with jaw-dropping drops in GDP. People, firms, and governments have adapted to the virus, meaning that the link between GDP and restrictions on movement and behaviour is one-third of what it was, says Goldman Sachs. Some vaccine-makers expect fresh data to show that today’s jabs will still prevent the most severe cases of the disease. And, if they must, firms and governments will be able to roll out new vaccines and drugs some months into 2022. Even so Omicron—or, in the future, Pi, Rho, or Sigma—threatens to lower growth and raise inflation. The world has just received a rude reminder that the virus’s path to becoming an endemic disease will not be smooth.
