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France curbs city life in Europe’s battle to contain the spread of Covid-19

France introduced new measures to fight the rapid resurgence of the coronavirus pandemic in major cities, adding to risks weighing on an already slowing economic recovery.

The first significant tightening of restrictions on daily life since the end of the lockdown in May includes closing bars at 10 p.m. in Paris and several other large urban centres. The tougher restrictions follow similar moves in the UK, as Europe reemerges at a hot spot for the disease.

“If we don’t take measures rapidly, we risk being in a critical situation in some regions in a few weeks,” Health Minister Olivier Veran said at a press conference in Paris late Wednesday, insisting that the government isn’t considering another nationwide lockdown.

There are signs the prospect of harsher curbs has already hit confidence, which improved less than expected in September. National statistics agency Insee said that while business leaders are more upbeat about recent activity, they are losing optimism about the outlook for their own companies and the entire services sector.

“Today’s measures are an extra shock to confidence as it reminds consumers that it isn’t over,” said Julien Manceaux, an economist at ING. While some sectors could be hit, “it’s not a general shock.”

France is the latest in a string of European governments to change tack in the face of mounting infection rates as they try to avoid the widespread restrictions that tipped the continent into a deep recession earlier this year. UK Prime Minister Boris Johnson this week abandoned his appeal for Britons to return to offices as he warned of “many more deaths” unless people obey a raft of new restrictions.

The British government is due to set out a fresh round of policies to support jobs on Thursday after abandoning plans for a fall budget. A government official said Wednesday that now is not the right time to outline long-term strategy, a sign the Treasury is preparing for months of economic disruption.

In France, the virus has gathered force after tailing off at the start of the summer. The country has recently hit fresh highs in daily infections of more than 13,000 positive tests.

Gyms in the hardest-hit French cities will be shuttered for two weeks, and there will be limits on public and private gatherings. In Marseille — one of the most seriously affected areas — all restaurants and bars will be shut from Saturday.

Any new restrictions will apply for two weeks and can be extended, Veran said, adding that businesses affected will be compensated. Prime Minister Jean Castex will be under pressure to explain the strategy when he appears on TV talk show Thursday evening.

“It’s an unfair decision that the government has taken only to mask its inability to handle the crisis,” Franck Trouet, spokesman for the employers’ union GNI, told Agence-France Presse on Thursday, adding that bars and restaurants will suffer from a new loss of business after having invested heavily to meet social distancing rules.

Shares in exhibition organizer GL Events fell as much as 10% to its lowest level in more than a decade.

The widening spread has disrupted national politics. Finance Minister Bruno Le Maire, who is in quarantine after confirming he tested positive for Covid-19 last week, will hold a call Thursday with representatives from sectors hit by the new restrictions.

France’s neighbors are reacting by restricting travel. Italy on Monday ordered mandatory virus tests for people arriving from Paris and some other parts of France. Germany on Wednesday added the regions of Brittany, Normandy and Centre-Val de Loire to its list of coronavirus “risk areas.” The Paris region has been on the list since the end of August.

Many of the new infections have been linked to vacationers bringing the virus home, as well as young people socializing without respecting distancing and hygiene rules.

So far, the fresh wave of infections hasn’t claimed large numbers of lives. More than 30,000 people died from the disease in France between March and July. The government reported 43 deaths linked to Covid-19 on Wednesday, bringing the total to 31,459.

That’s given President Emmanuel Macron the leeway to use more targeted measures to fight the disease to minimize the hit to the economy, following the path taken by France’s European neighbours. The government has said that France can’t afford to impose another full lockdown.

By Bloomberg

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