Preparing for what's beyond: European countries begin to brace for the post-COVID economic crisis
Europe is a colourful continent in terms of policies and outcomes. It is essential to stay updated on how these policies may impact your work to build better regulatory frameworks, enhance your message and enhance communication with stakeholders.
Here you can find a summary of the major European political updates of this week.
Italy has now 139,422 confirmed cases of infection and 17,669 deceased. Since last week, Italy has seen a slow drop in the daily number of deaths. Nonetheless the lockdown will last until 13 April at least. The Italian Government hopes to start gradually lifting the lockdown measures after Easter. On Monday 6 April, the Italian Government adopted the “Decreto Liquidità” (Liquidity decree) – a new decree to support the economy and businesses. This includes a €400 billion liquidity plan for small, medium and larger businesses. It establishes a guarantee from the government to provide loans to businesses employing up to 499 workers. For larger firms a special fund will be set up, with rates depending on the firm’s size and revenues. The Economy Minister Gualtieri underlined that businesses benefiting from the state-guaranteed loans will not be allowed to distribute dividends to shareholders. The decree also enlarges the “golden power” of the government, which screens investments and shields Italian companies from foreign buyers that could seek to benefit from their current low value. The decree also foresees the suspension or delay of several taxes for the next months. Businesses will also receive a 50% tax credit for medical products and for sanitation expenditures. A previous decree by the Italian government named “Cura Italia” (Heal Italy) on 17 March focused on supporting workers, families, schools and the health system. Together these two programmes are an “unprecedented economic intervention” by the Italian government, as stated by the Economy Minister Gualtieri.
On 7 April, the UK had recorded 55,242 cases and 6,159 deaths, and the day saw a record 786 new deaths. The Government is delivering on its pledge to increase testing from below 10,000 to 25,000 by mid-April, with 14,006 tests carried out on 6 April. The Health Secretary Matt Hancock came out of self-isolation last week to unveil a ‘five-pillar’ testing plan, decentralising testing to develop a ‘huge diagnostic industry’. Universities, research institutes and private companies will supplement the Government’s efforts to reach 100,000 daily tests in England by the end of April. As of 8 April, Prime Minister Boris Johnson has spent a second night in intensive care in what is reported to be serious but stable condition, though he is expected to face weeks out of action. Concerns about the power vacuum in his stead have intensified amid reports ministers will take responsibility for their respective policy areas and Foreign Secretary Dominic Raab will deputise in limited settings. An oppositional power vacuum was filled on 4 April, with Sir Keir Starmer assuming the Labour leadership after a convincing election victory, where he will be deputised by Angela Rayner. Starmer’s Shadow Cabinet appointments balance experience and reform-mindedness across the wings of the party and include former Labour leader Ed Miliband.
As of 8 April, Germany surpassed 100,000 confirmed Covid-19 cases and 1,861 deaths. On 6 April, Chancellor Angela Merkel reported on the decisions of the Corona Cabinet and on the cooperation within the Eurogroup and stressed that Covid-19 is the EU's biggest challenge since its foundation. The Cabinet decided that the production of personal protective equipment must be promoted. Merkel did not want to comment on a date for an end of the lockdown in Germany, and currently 19 April is the earliest date to start presenting step-by-step measures. Digitalisation is playing a big role in fighting covid-19. On 1 April the cabinet passed a draft law on the protection of electronic patient data in the telematics infrastructure (Patientendaten-Schutz-Gesetz). Thereby, from 1 January 2021, health insurance companies will make the electronic patient file available. On 7 April, the Robert-Koch-Institute, the central institution of the government in disease monitoring and prevention, launched a Corona Data Donation App that collects the data of wearables that may indicate symptoms of a Covid-19 infection.
Regarding travelling, Germany’s entry requirements will be tightened from 10 April with a two-week quarantine for those entering the country. However, it was decided on 3 April by the Federal Minister of Agriculture Julia Klöckner and Federal Minister of Interior Horst Seehofer that up to 40,000 seasonal agricultural workers will be allowed entry to Germany under strict conditions. Regarding migration, around fifty politicians from the CDU/CSU Union are urging EU Commission President Ursula von der Leyen to quickly place children from overburdened refugee camps on the Greek islands in other EU countries. On 7 April Germany agreed to take in fifty unaccompanied minors.
On 7 April, at the Council of Ministers, Prime Minister Pedro Sánchez tabled a second extension of the state of emergency for a further 15 days. The current state will last until 12 April; a new period will follow until 26 April. The Congress has the last word to approve the decree on the matter; after initial rejection from the opposition, the legislation is now expected to be passed on 9 April. Conditions under the second extension are expected to remain the same and may be subject to further extension.
PM Sánchez confirmed that the termination of containment measures will be gradually implemented, possibly throughout May, evolution of COVID-19 permitting. To this end, the Ministry of Health is moving forward with its diagnostic strategy to use antibody tests in a sample of 62,400 individuals for three weeks to determine the degree of spread of the virus. Additionally, a million rapid diagnostic tests have been distributed amongst regions and a second batch will follow in the upcoming days.
The country has extended curfew measures until 27 April following an increase in the death toll of 76, with positive cases now numbering over 1,600. Coinciding with World Health Day on 7 April, the Government paid tribute to the efforts of medical personnel in fighting the COVID-19 pandemic. International credit rating houses predict that Greece will go into deep recession during 2020 following a significant increase in the national debt resulting from measures to mitigate the economic effects of COVID-19.
You can find more information on European news in our EU national elections heatmap, where we provide an overarching perspective with key political insight for individual countries. Make sure to check it here.