In not altogether unsurprising news - ECB chief Christine Lagarde warned today that the coronvirus is a major shock to the growth prospects of the euro area. Even before COVID-19 there were warnings of weakness in the eurozone thanks largely to global trade tensions but /1
The coronavirus crisis is exacerbating already existing weaknesses - eg Italy and export-driven Germany. There are warnings eurozone could slip into recession. ECB today announced a package of measures to try to shield the euro area from economic impact of COVID-19 eg /2
providing cheap loans to banks so they will lend money to struggling European businesses BUT pressures on European economies continue apace. President Trump's ban on travel to the US for non US citizens from the 26 countries in Schengen area was unexpected blow today /3
EU Commission Chief von der Leyen + Council President Michel didn't mince their words: “The coronavirus is a global crisis, not limited to any continent. The EU disapproves of the fact that the US decision to impose a travel ban was taken unilaterally and without consultation” /4
EU Diplomats tell me: "Shows Trump's anti-EU paranoia" and "The decision and way it was communicated show you everything you need to know about the transatlantic relationship right now." /5
The ban obvs affects passengers and airlines. Mostly in France, Germany and Netherlands as they have the more frequent number of flights to US out of the Schengen countries. Often partnering with American Airlines and Delta -which will also clearly be affected /6
Europe's leaders like others worldwide are struggling to appear in control of spiralling, unpredictable situation. Some - like Italian PM Conte - are enhancing their reputation amongst voters with their perceived handling of situation while others like Germany's Merkel .. /7
Are coming in for heavy criticism - in her case for being *too slow* to appear in public to discuss public health measures being taken and discuss the threat of the virus to Germany /8
EU is haunted by the ghosts of crisis past: 2015 migration crisis where EU countries closed borders to one another and euro crisis when Greek debt emergency threatened to bring down the whole currency. Now in 2020 bc of the corona virus, Austria is closing borders to Italy and /9
There are whispers an Italian economic crisis linked to the corona virus could bring eurozone to its knees. Italy always judged *too big to fail*. Clearly, economic strain of virus is not only present in Italy, just as European border closures aren't limited to Austria alone /10
