Europe Goes Dark in Coronavirus Fight as Macron Invokes War

Ania Nussbaum, Arne Delfs and Ruben Munsterman
Europe Goes Dark in Coronavirus Fight as Macron Invokes War

(Bloomberg) -- European leaders attempted to prepare their citizens for the unprecedented trials ahead as comprehensive curbs on national life come into force to control the spread of the deadly coronavirus.

Government chiefs will hold another emergency telephone call later on Tuesday to discuss closing borders and other efforts to combat the spread of the virus as many governments across the region meet to sign off on measures to protect their economies and businesses from collapse.

Late Monday, France said it will guarantee up to 300 billion euros ($335 billion) of bank loans to companies in an effort to bolster virus-hit firms. The country followed Germany’s lead, which on Friday announced plans to lend as much as 550 billion euros to shore up Europe’s economic engine.

Italy, the worst-hit country in Europe, approved a 25 billion-euro ($28 billion) package to support its strained health system while helping businesses and families. The country’s latest measures range from suspending tax payments to helping cover layoffs to mortgage relief, as a nationwide lockdown weighs on the already sluggish economy.

“We’re trying to build a dam to protect workers and families,” Prime Minister Giuseppe Conte said. “This is a European challenge which has to involve collaboration,” the premier said in an appeal for more coordination.

In a series of public addresses Monday night, the leaders of countries from Finland to Germany sought to convince populations of the need for restrictions on their daily lives ranging from school and workplace closures to the shuttering of non-essential shops and services. Alongside efforts to prepare national populations for sacrifice, the European Union was battling to maintain cohesion as the crisis threatens to tear at the bloc’s bonds.

“We are at war,” President Emmanuel Macron said in an address to the French people on Monday evening, making the case for national unity in the face of shared sacrifice. Hotels and taxis will be requisitioned for health workers, all proposed reforms, including his controversial pension overhaul, are to be halted, while the government will ensure that no business is allowed to fail. Bank loans will be guaranteed for companies and a solidarity fund created for workers affected by the fallout of the virus containment.

Uneven efforts to stem the pace of infections have revived border checks between European Union member states and suspended the normal free flow of goods and people -- one of the key pillars of European integration. In a bid to coordinate efforts, the European Commission proposed a halt on travel to and from the bloc, while admitting the measure may have little real impact on the spread of the virus.

In the social sphere, Macron announced a ban on all meetings in public spaces, calling for “solidarity and responsibility” after people had been seen congregating in parks, restaurants and bars, posing a risk to themselves and to others. Only necessary trips outside such as for grocery shopping or for physical exercise will be allowed, with sanctions on those who don’t adhere to the rules, he said.

“The crisis will have major human, social, economic consequences,” and France “will need to adapt,” Macron said. “One thing is certain: the more we work together, and fast, the better we will overcome this challenge.”

Some key parts of Italy’s latest decree, which hasn’t officially been published yet, include a new state-controlled company to take over bankrupt airline Alitalia, a 5 billion-euro package of loan guarantees and funds to avoid a credit crunch, funding for the stricken healthcare sector and reimbursement for childcare. The state will have the right to seize hotels or other buildings to use as temporary healthcare facilities.

Finance Minister Roberto Gualtieri said a further economic stimulus package will be approved next month. La Stampa reported Tuesday that it could be worth as much as 30 billion euros.

New Epicenter

The lockdown that began in Italy has now extended to most of the rest of the continent, and markets continued their downward spiral on Tuesday after European stocks ended at their lowest level in seven years. Governments imposed a series of measures constricting Europe’s way of life that have been unseen in 75 years of peace time, reflecting the continent’s status as the new epicenter of the virus that first ravaged Asia.

Germany’s federal government agreed on guidance with the country’s 16 states that will see public life grind to a halt in Europe’s biggest economy. Closures include bars, clubs, theaters, cinemas, museums, trade fairs, gyms and swimming pools – even brothels. Shops and services such as supermarkets, delivery services, banks and post offices are excluded. Gatherings in churches, mosques and synagogues will be stopped. Restaurants may stay open from 6am to 6pm; overnight stays for tourism will be halted.

“These are measures that we’ve never before seen in this country, and of course they’re drastic,” Chancellor Angela Merkel said at a news conference in Berlin on Monday evening. “But they are necessary right now to reduce the number of contacts.” Economy Minister Peter Altmaier said the virus impacts could last through May.

Germany on Tuesday issued a travel warning for the rest of the world and will spending 50 million euros to bring its citizens back home.

Eastern Spat

The closing of borders has already triggered a diplomatic spat. The EU’s Baltic members -- Estonia, Latvia and Lithuania -- sent diplomatic letters to Poland after hundreds of their citizens trying to travel home were stranded at the Polish-German border despite an earlier pledge by Warsaw to let them through.

“Negotiations continue for a fourth day, we are reaching out to the Poles on every possible front,” said Lithuanian Prime Minister Saulius Skvernelis. “But there’s no explanation. The Poles have likely decided to keep their country isolated.”

Read more: Halt Travel to Fight Coronavirus? The Pros and Cons: QuickTake

To the south, Austrian TV reported queues of cars backed up for at least 10 kilometers (six miles) at the frontier with Hungary, recalling the long waits at border crossings that dominated before the EU’s 11 ex-communist members started joining in 2004. Since midnight, Bulgarians and Romanians were denied entry to transit Hungary on their way home from other EU states.

Most countries in the EU’s eastern wing, a region that’s home to more than 100 million people, imposed strict measures -- including demands that people avoid unnecessary forays in public, closing schools, social venues and businesses, and imposing limits on who can cross their borders -- last week.

Historic Task

Here are some of the other measures in Europe:

Portugal and Spain announced that they would close their shared border and suspend all air and rail links to tourists. The border would remain open for the transport of goods.Finland began preparations to invoke emergency powers, allowing the government to close borders, schools and universities, and limit public gatherings to 10 people. It also unveiled 5 billion euros ($5.6 billion) worth of measures to help the economy.The Greek government announced that all shops will be closed from Wednesday except for essential services. Covid-19 cases in the Mediterranean island of Cyprus meanwhile rose to 46.In Switzerland, the government declared a national emergency and closed restaurants, fitness clubs and other public establishments. Travel from immediate neighbors Germany, France and Austria will also be limited to people commuting for work or who live in Switzerland, a rule already enacted for Italy.The Netherlands is adopting a stance similar to the U.K. by avoiding a total lockdown, drawing criticism for late closing of schools to prevent the spread.

Dutch Prime Minister Mark Rutte, in a rare emergency address, said that it will take more than a year for the virus to run its course through the population and the economic consequences of complete isolation would be too great.

“The task we face is very large,” Rutte said. The reality is that the coronavirus “will be among us for some time.”

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