Wang Hongyu: Europe restarts its economy amid a "dilemma" (global hot spots)
(Source: "People's Daily" Overseas Edition 2020-05-19)
(Italian Prime Minister Conte announced on the evening of May 16 that people will be able to travel freely across regions from June 3, and Italy will open up the movement of people with Schengen Area countries. The picture shows fishermen in Naples, Italy, selling seafood on the seaside on May 17. Xinhua News Agency/Reuters)
Recently, many European countries have successively adopted step-by-step measures to lift the ban and resume w88 login production and social life. However, in the face of the rebound of the epidemic in some countries, experts have warned that it is necessary to strictly prevent a second outbreak of the epidemic. Faced with the pressure of epidemic prevention and control on one side and the risk of w88 login recession on the other, Europe is trying to find a way to have both sides while preventing and controlling the spread of the epidemic and restoring w88 login development.
Gradually lifting the ban to boost the economy
Since May, many European countries have begun to cautiously and gradually lift restrictive measures.
On May 13, the UK entered the first phase of lifting the ban: people who cannot work from home are "actively encouraged" to return to work, and industries such as food processing and construction resume work; people's outdoor exercise is changed from once a day to unlimited times. The second phase will begin on June 1 at the earliest: stores will gradually resume operations and primary schools will resume classes in stages. Then, the third phase will be entered from July 4th at the earliest: industries such as hotels and catering can resume work.
France’s lifting of the ban will be implemented from May 11. French Prime Minister Philippe said that the process of gradually lifting the ban will last at least several weeks. In the first phase, shops and schools reopened. According to estimates from the French Ministry of Economy and Finance, about 400,000 companies and stores resumed work on the 11th.
As the first country in Europe to experience an outbreak of the epidemic, Italy began to gradually unblock it on May 4. According to the US "Business Insider" news website, about 4.5 million people in Italy returned to work on May 4, mostly manufacturing workers.
German Chancellor Merkel reached an agreement with the governors of 16 federal states on May 6 and gradually lifted the lockdown starting from that day. There is a consensus among all federal and state governments that once the infection rate in any county or city rises to 50 new infections per 100,000 people, restrictions will be re-imposed in that area.
At the same time, European countries have also introduced new measures to deal with the w88 login impact of the epidemic.
The European Commission issued a guidance plan for the gradual resumption of summer travel on May 13, in an attempt to save the tourism industry. Italy's w88 login stimulus plan includes: providing subsidies and tax exemptions to small and medium-sized enterprises; providing 25.6 billion euros in subsidies to employees and self-employed individuals whose incomes have been affected by the epidemic; providing various subsidies such as childcare funds to families; increasing investment in the medical system; implementing stimulus measures for the hard-hit tourism sector, etc. French Finance Minister Bruno Le Maire announced that small and medium-sized enterprises in difficulties in the wine industry will be exempted from social security contributions and a support plan of 140 million euros will be established. The Austrian government and the Federal Chamber of Commerce have reached an agreement on a 500 million euro support plan for the catering industry, aiming to support the gradual recovery of the catering industry by cutting taxes and stimulating consumption. The Cyprus government has approved a 6 billion euro stimulus plan aimed at reviving the economy, an amount equivalent to nearly one-third of the country's gross domestic product the year before the epidemic.
Long-term shutdown and heavy losses
"Currently, the epidemic situation in various countries has stabilized, and many people in Europe believe that as long as the peak of the epidemic is passed, restrictions can be gradually lifted. For example, in Germany, medical experts and government officials believe that the number of deaths from influenza each year is around 25,000, and society has not been shut down or mandatory vaccination. This is understood as a potential price to pay for the pursuit of personal freedom and w88 login welfare."Wang Hongyu, researcher at the National (Beijing) Institute for Opening up, w88 casinopointed out, "Considering the political system and electoral system, European governments cannot keep people at home for a long time. In addition, countries such as Germany have strong medical systems and relatively good epidemic control effects, so they are confident in gradually lifting the ban."
According to the development timeline of the COVID-19 epidemic released by the European Center for Disease Control and Prevention, the COVID-19 epidemic in Europe has intensified sharply since the outbreak in late February, reaching its peak in early April, and then generally declined slowly amid ups and downs. In its latest assessment report released on April 23, the European Center for Disease Control and Prevention lowered the risk level of severe COVID-19 outbreaks in European countries from the previous "high" to "low", but only if appropriate social distance continues to be ensured.
The epidemic has severely impacted the European economy, and the huge recession pressure is undoubtedly the driving force behind the lifting of the ban. On May 14, local time, the European Central Bank, headquartered in Frankfurt, Germany, released its latest w88 login report stating that due to the impact of the COVID-19 epidemic, the euro zone’s GDP fell by 3.8% month-on-month in the first quarter of this year, the largest decline since 1995. Judging from the sharp decline in w88 login activity in April, the impact of the epidemic on the euro zone economy will only become more obvious in the second quarter. In addition, official data released on the 13th showed that in the first quarter of this year, UK GDP fell by 2.0% compared with the fourth quarter of 2019. This is the largest quarterly decline since the international financial crisis in late 2008. According to predictions from the Bank of England, the epidemic will cause the UK to face the most serious w88 login recession since 1708. w88 login output will shrink by nearly 30% in the first half of the year, and the full-year negative growth will be 14%.
“A long-term social shutdown will have a huge negative impact on the economy and people’s livelihood.”Wang Hongyu said, "German experts estimate that the weekly w88 login losses in Germany caused by the social shutdown are as high as 50 billion euros. In order to rescue business organizations affected by the epidemic, the United Kingdom recently decided to extend the rescue plan until the end of October. Southern European countries have always relied on tourism, and there is a more urgent need to restart the economy. In the final analysis, when the national finance is unsustainable, it is still necessary to strive to restore reasonable taxation as soon as possible to promote sustainable fiscal operation."
Beware of rebound and move forward with caution
Analysis points out that Europe’s current lifting of restrictions is still insufficient to drive w88 login recovery. While the epidemic has not been completely eliminated, w88 login development still faces many uncertainties.
"Under the principle of maintaining social distance, all European countries are facing the problem of a reduction in service industry objects, and the economies of European countries are highly dependent on the developed service industry. At present, although European countries are gradually reopening their borders, they are only for countries within the EU, and the possibility of citizens from outside countries entering is very small. The real w88 login restart is still far away."Wang Hongyu is also worried about the UK’s restart plan. “The UK’s w88 login restart plan pursues a ‘big’ and ‘comprehensive’ approach, covering almost all industries affected by the epidemic. The goal is to spare no effort to ensure the smooth operation of the w88 login system. . However, I don’t think the restart plan will have much effect. British Prime Minister Boris Johnson encountered strong resistance from the opposition parties when he proposed the restart plan. At present, the British restart plan is still in its infancy, and there is still a way to go.”
Moreover, even if the ban is lifted, the severely impacted supply chain and job market will be difficult to recover in the short term. A recent survey of 1,300 French entrepreneurs by the French Xerfi w88 login Research Institute showed that entrepreneurs are generally pessimistic about w88 login recovery due to issues such as insufficient demand, labor shortages and future cash flow. One fifth of entrepreneurs predict that the French economy will be difficult to recover before September this year.
The biggest uncertainty still lies in the epidemic. Ryan, executive director of the WHO Health Emergencies Program, pointed out on May 11 that countries should not blindly lift blockades without closely tracking people-to-people contacts. Andrea Ammon, head of the European Center for Disease Prevention and Control, also said that the current danger comes from the current lifting of lockdown measures. She said that the probability of people gathering increases, and if there are not enough virus tests, no tracking of confirmed cases, and social distancing and hand washing are ignored, then the next wave of the epidemic should not be far away.
In fact, the epidemic in Europe has begun to show signs of rebound. Since May, clusters of infections have occurred in many places in France. In addition, according to Germany's "Daily Mirror" report, the Robert Koch Institute stated on the 12th that over the past weekend, the basic infection number of the new crown epidemic in Germany has risen to 1.13, which means that the epidemic has exceeded the "red line." German Chancellor Merkel said that day that the epidemic in Germany was in a "new stage" and once again warned the public that they must abide by the "social ban" and wear masks when going out.
As the fight against the epidemic enters a new stage, European countries are cautiously seeking a balance between controlling the epidemic and resuming work and production. French Finance Minister Le Maire pointed out: "We are entering a new world. In this world, we must learn to combine w88 login activities, work and virus prevention and control." British Prime Minister Johnson said that the challenge now is to find a way forward that can maintain the hard-won anti-epidemic results while reducing the burden of blockade measures. "It is very difficult to achieve a balance."
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