Europe Strains to Contain Covid as France, Austria Tighten Curbs
France Cracks Down on City Life in Battle to Contain Virus
(Bloomberg) -- France and Austria imposed new restrictions on bars and restaurants, adding to risks weighing on an already slowing economic recovery in Europe.
The first significant tightening of restrictions on French daily life since the end of the lockdown in May includes closing bars at 10 p.m. in Paris and several other large urban centers. Health Minister Olivier Veran warned that some regions could be in a “critical situation” within weeks without the new measures.
As Europe reemerges as a hot spot for the disease, Austria banned apres-ski partying for the upcoming winter season, and the U.K. -- which imposed tougher curbs of its own this week -- set out a plan Thursday to rescue millions of jobs.
“Our economy is now likely to undergo a more permanent adjustment,” Rishi Sunak, Britain’s chancellor of the exchequer, told the House of Commons. “I cannot save every business, I cannot save every job. No chancellor could.”
France is the latest European country to change tack in the face of mounting infection rates as leaders try to avoid the stringent lockdowns that tipped the continent into a deep recession earlier this year.
U.K. Prime Minister Boris Johnson this week abandoned his appeal for Britons to return to offices and also ordered pubs, bars and restaurants to shut by 10 p.m. as he warned of “many more deaths” unless people obey new restrictions.
The centerpiece of Sunak’s announcement was a new jobs support program to succeed the furlough policy that ends on Oct. 31 and has backed more than 9 million workers at a cost of 39 billion pounds ($48 billion). The new policy will pay subsidies to employees who are able to return to their jobs for at least a third of their normal hours.
Austria sought to save its ski season by imposing a ban on partying off the slopes after lax controls at the Ischgl resort this spring sparked lawsuits against Chancellor Sebastian Kurz’s government. Restaurants and bars will only be allowed to serve seated customers under the new rules.
“Hundreds of thousands of jobs directly or indirectly depend on tourism,” Kurz said. “For all fans of winter sport, one thing is clear: there will be fun on the slopes, but without apres ski.”
There are signs the prospect of harsher curbs already hit confidence in France, which improved less than expected in September. While business leaders are more upbeat about recent activity, they are losing optimism about the outlook for their own companies and the entire services sector, national statistics agency Insee said.
“Today’s measures are an extra shock to confidence as it reminds consumers that it isn’t over,” said Julien Manceaux, an economist at ING. While some sectors could be hit, “it’s not a general shock.”
In a rare bright spot, German companies are turning increasingly optimistic that government support and a reluctance to return to wide-scale lockdowns will carry the economy through the pandemic.
Like other European countries, the virus has gathered force in France after tailing off at the start of the summer. Daily infections in the country have recently hit fresh highs of more than 13,000 positive tests. Germany’s rates have stabilized after a recent uptick.
But so far, the fresh wave of infections hasn’t claimed a large number of lives. More than 30,000 people died from the disease in France between March and July. The government reported 43 deaths linked to Covid-19 on Wednesday, bringing the total to 31,459. There were 18 deaths in Germany in the 24 hours through Thursday morning.
Gyms in the hardest-hit French cities will be shuttered for two weeks, and there will be limits on public and private gatherings. In Marseille -- one of the most seriously affected areas -- all restaurants and bars will be shut from Saturday.
Any new restrictions will apply for two weeks and can be extended, and affected businesses will be compensated.
With many of the new infections across Europe linked to returning vacationers, France’s neighbors are reacting by restricting travel. Italy on Monday ordered mandatory virus tests for people arriving from Paris and some other parts of France. Germany on Wednesday added the regions of Brittany, Normandy and Centre-Val de Loire to its list of “risk areas,” which already included Paris.
“The feature of an outbreak with such a contagious and invasive virus as the coronavirus is that it goes very fast,” Veran said in a parliamentary hearing. “When it goes up, it goes up very quickly.”
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