Conte Cautiously Edges Italy Out of Virus Lockdown From May 4

(Bloomberg) --

Prime Minister Giuseppe Conte said Italy will cautiously begin lifting a nationwide lockdown on May 4, giving an initial respite to businesses paralyzed by weeks of containment measures to check the spread of the coronavirus.

Construction and manufacturing will be the first industrial sectors to be allowed to reopen, with retailers and museums to follow two weeks later and bars, restaurants and barbers potentially on June 1, Conte said in a briefing late Sunday in Rome. Earlier Sunday, Italian authorities reported the fewest deaths linked to the virus since March 14.

“We all want the country to restart,” said Conte, whose country has recorded the most virus-related deaths in Europe. “But the only way to live with the virus in this phase is to not fall ill — and social distancing.”

Conte’s prescriptions for the European Union’s third-biggest economy follow weeks of appeals from coalition allies, companies and local leaders — especially in the wealthy Lombardy region around Milan, the area worst-hit by the virus.

He has to juggle the opening with warnings by medical advisers that relaxing the lockdown, in place since early March, could trigger a new outbreak. The measures announced Sunday also include initial steps to let people leave their homes.

Conte warned that if Italians fail to respect rules including social distancing, the curve of contagion “will rise and could become out of control, the number of our dead will increase and our economy will suffer irreversible damage.”

Crushed Economy

A tired-looking Conte, who stumbled repeatedly during his remarks, didn’t provide clarity on several questions, including plans for contact tracing and how schools would reopen. His performance is likely to reinforce doubts about how Italy will tackle a dramatic recession and deliver promised aid to millions of workers and small businesses.

The government is trying to save an economy that’s headed for an 8% contraction this year and trailed its euro-area peers even before the pandemic. It’s a struggle that EU allies facing a similar dilemma will watch closely.

The national lockdown has shuttered all non-essential businesses, banned movement within Italy and mostly confined people to their homes except for work, health or emergency reasons.

Conte’s timetable allows wholesale retail linked to manufacturing and construction to reopen on May 4. “This is allowed only on the condition that all these companies will rigorously respect security protocols,” he said.

Authorities will monitor alert thresholds drawn up with the government’s medical advisers, Conte said, and “we will be able to intervene when we see critical, localized situations, and we will close the tap.”

Parks will be reopened, on condition local authorities ensure that people do not form groups there. Sports will be allowed, but only if participants stay two meters from each other. People will be allowed to go for walks and for a run further away from their homes than now.

Italians will be allowed to visit relatives from early May, as long as they wear protective masks and respect social distancing. Shops and museums will restart on May 18. The government aims to reopen bars, restaurants and barbers on June 1, Conte said.

Stimulus Spending

Civil protection authorities earlier Sunday reported 260 deaths linked to the virus for the 24-hour period -- the fewest since mid-March, the early days of the lockdown. That brings the total number of fatalities to 26,644. Confirmed cases now total 197,675, with a leveling off over recent weeks.

Italy already depends on the European Central Bank’s emergency bond buying program to keep its borrowing costs down. Bloomberg Economics forecasts that gross domestic product will shrink by 13% this year.

Parliament is due to vote on the government’s request to widen the deficit by an additional 55 billion euros ($59 billion) for a new stimulus package to counter the impact of the coronavirus. That is on top of an initial 25-billion euro program approved in March.

©2020 Bloomberg L.P.