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WHAT IMPACT CAN EXPECTED?

Coronavirus in Italy: What we know so far

Coronavirus in Italy: What we know so far

  • The country is facing an unexpected outbreak of the virus, with more than 200 cases and 7 deaths reported. Officials locked down 10 towns while panic is surging steadily

martes 25 de febrero de 2020, 11:13h
Panic is surging in Italy while the country faces a sudden outbreak of coronavirus. At least 200 cases and seven deaths were recorded so far, turning Italy into the virus' epicenter in Europe and the third worst-hit country worldwide after China and South Korea.The spike was largely unexpected, as the total amount leaped of more than 100 in the space of one day. The vast majority of them were reported in Lombardia, the region encompassing Milan, and Veneto, the region around Venice. In Milan, Italy's business capital, museums, universities, and schools were closed, while some major fairs were postponed and more restrictions are to be imposed in the upcoming days.

The famous Venice Carnevale was canceled and major football matches suspended last Sunday. The fear of getting short of food triggered a hysterical run to supermarkets, with people reported waiting in line since 5 am.

How the country is trying to react

The rise of coronavirus is sparking fear that the country is unprepared to contain the outbreak. Italian Prime Minister Giuseppe Conte openly admitted that he “did not expect” the virus to rise so sharply. Nonetheless, Mr Conte says, “We took more than 4,000 swab tests. Italy was the first country in the EU to opt for such a rigorous approach. Should the other EU countries follow the same path, they might find out similar increases too”.

At least 10 towns were locked down in Lombardia and Veneto, the two epicenters of the infection, limiting the movement of nearly 50,000 people. The virus firstly emerged in Codogno, southeast of Milan, and Vo' Euganeo, close to Padua.

The government sent 500 policemen to monitor the borders of the so-called “zone rosse” (red zones), while similar procedures are likely to be deployed elsewhere. Schools, universities, museums, tribunals are being halted also in the regions of Emilia-Romagna, Friuli Venezia-Giulia, Piemonte and Trentino-Alto Adige. Controls are getting especially tough in Milan, where also pubs and bars will be forced to shut down between 6 PM and 6 AM and even religious ceremonies in the Duomo (the city's cathedral) will be stopped. During Milan’s Fashion week some shows, notably the Giorgio Armani’s one, were streamed from empty theaters.

When traveling beyond borders, Italian citizens are being widely quarantined. The Austrian government stopped a train coming from Italy as two suspected passengers were reported on board. Some 300 Italians are currently stuck in the airport of Mauritius Islands, as passengers coming from Veneto e Lombardia are not allowed to get in.

What impact can be expected?

The European Commission stated to be “worried” for Italy and called for a “stronger cooperation” between member states. The EC fears that the outbreak will undermine the Italian economy. There are some reasons to be afraid.

Tourism is already on decline while several faires are being postponed. The isolation of Lombardia and Veneto would pose a serious risk for the whole Italian economy, as Lombardia accounts for 22% of Italian GDP and is regarded as the economic engine of the country. Several companies are pushing their employees to home-working, but the impact on productivity is likely to be significant.

Nomura, a Japanese investment bank, foresees that Italian Gdp will decline by 0.1% in 2020 (the Italian government expects a 0.6% increase instead). Meanwhile, investors are getting nervous. Italian stocks plunged steadily on Monday with the FTSI Mib falling by more than 4.6%. According to Reuters, the index is on course for its worst fall since June 2016. Health officials are warning people “not to panic” as anxiety and cases keep growing. It may be too late.

Italy to ask the EU for more flexibility

Italy could ask the EU for more flexibility on its budget targets as the coronavirus outbreak threatens its economy. Laura Castello, the Deputy Economy Prime Minister, told the Italian broadcaster Radio Rai that the government may call on the EU for an exceptional help as the impact of the virus is likely to undermine the economic engine of the country, Lombardia. Officials from the World Health Organization and the European Union are gathering on Tuesday in Rome to discuss how to contain the spread of the virus.

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