Brussels Edition: Glimmers of Hope

(Bloomberg) -- Welcome to the Brussels Edition, Bloomberg’s daily briefing on what matters most in the heart of the European Union.

The number of  new infections is dropping in both Italy and Spain, the countries hardest hit by the pandemic. While it’s too early to say whether that represents the start of a trend, any piece of good news is welcome in a week where death tolls have surpassed 17,000. But as the epicenter shifts to the U.S., there’s no respite for the region’s battered economies. An ever increasing number of economists now predict a double-digit decline in GDP for the euro area this year, and the political tremors from such an unprecedented shock to the integrity of the EU can already be felt.

What’s Happening

Back-Channels Open | Finance ministers and their top aides will amp up contacts this week in an effort to broker a compromise on how to shoulder the burden of the outbreak’s economic pain. Yet it’s unclear how much progress finance chiefs can really achieve if their leaders continue to be plagued by crisis-era like differences over risk sharing and debt.

Extraordinary Measures | Everywhere in Europe, governments are taking exceptional measures to keep businesses afloat until the pandemic abates. The U.K. government is loosening its bankruptcy rules; the Czech Republic is preparing to introduce a moratorium on loans and mortgage repayments to help struggling firms; and Greece is set to announce its own comprehensive plan this morning.

Different Philosophies | The coronavirus crisis is proving a test case for contrasting social models, as governments in the U.S. and Europe pursue different policies to cushion their economies from much the same shock. If you are wondering which approach works best, Craig Stirling has some answers.

Tourism Slump | Hundreds of billions of euros in revenue and millions of jobs are at stake from the looming slump in tourist arrivals in Europe’s popular destinations this year. Beyond the immediate concerns, the virus could herald structural changes for the industry. This is why.

In Case You Missed It

German Shortages | Germany may run into a shortage of critical medical equipment and hospital capacity even though the country has done relatively well in combating the coronavirus so far, scientists and politicians warned. The country needs a strategy to increase capacity and boost central planning because of a lack of protection gear, testing and ventilators.

Lessons From ‘08 | Not since the sovereign debt crisis has the financial world been so close to collapse. As the infighting between politicians in Europe continues, the good news is that markets and central banks are much better prepared to cushion the blow, William Shaw and Jan-Patrick Barnert explain.

Cleaner Air | Pollution in some of Europe’s major cities has dropped dramatically since governments ordered people to stay home. The air is so much cleaner that the difference can be seen from space. Too bad we can’t go out to enjoy it.

Food for Thought | As more people are working from home, Bloomberg Pursuits has introduced a weekly “Lunch Break” column that will highlight a notable recipe from new cookbooks and the hack that makes them genius. It’s not enough to stock up on beans, you need to know what to do with them to survive.

Chart of the Day

As Europe’s economy nosedives, its leaders are at loggerheads over how to respond. A group led by France, Italy and Spain wants joint debt issuance to finance the necessary spending spree, while another camp led by Germany and the Netherlands resists the idea. The discord over risk sharing echoes the divisions that almost tore the EU apart during the sovereign debt crisis.

Today’s Agenda

11 a.m. Germany’s Council of Economic Experts publishes a special report on the economic impact of the coronavirus

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