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French Tourism Crashes By 35% Amid Virus Outbreak; Europe On Recession Watch

“That’s, of course, an important impact for the French economy.” 

French Minister of Economy and Finance, Bruno Le Maire, told CNBC’s Dan Murphy on Sunday at the G-20 Finance Ministers and Central Bank Governors’ Meetings in Riyadh, Saudi Arabia, that the Covid-19 outbreak will have a material impact on the French economy and the world. 

The country’s finance minister warned France’s tourism sector has plunged following the outbreak of the virus last month. “We have fewer tourists, of course, in France, about 30%, 40% less than expected,” Maire said. 

“That’s, of course, an important impact for the French economy,” he said. Tourism represents 10% of GDP in the country and supports upwards of 3 million jobs. 

Maire said France welcomed 2.7 million Chinese tourists last year, “It won’t be the same, of course, in 2020,” he said, referring to the more than 200,000 flight cancellations since the virus broke out in China last month. 

France has reported 12 confirmed cases of the virus, and one death as the country “activates” 70 new hospitals in preparation for a much broader outbreak. 

Following a Sunday meeting with Prime Minister Edouard Philippe, Health minister Olivier Veran said: “Until now we have had [only] 38 health establishments prepared to welcome ill people – basically university hospitals [centres hospitaliers universitaires; CHUs].”

“I have decided, in agreement with the Prime Minister, that 70 establishments with a SAMU [urgent response team, service d’aide médicale urgente] will be activated tomorrow to increase our response capacity if necessary.”

Veran said the country would boost its “testing capacity,” adding that protective gear, such as virus masks and biological suits, will be ordered in “large quantities.” 

He added: “We are acting quickly and decisively in the face of the threat of an epidemic…We are taking all the necessary measures to ensure the safety of the French people.”

Much of the outbreak in Europe is situated in Lombardy, a region in Northern Italy. 

More than 200 confirmed cases in Italy have been confirmed on Monday and four deaths. The country is taking similar measures as China did, shutting down cities and businesses as its economy starts to grind to a halt. 

Both France and Italy are already in danger of missing growth targets for 2020, and the outbreak of the virus on the continent could tilt both countries into recession. 

A much more significant risk is developing as a virus shock from China could push Europe into a downturn. Germany, the economic heartbeat of Europe, is already teetering on the edge of recession, the longer China’s economy remains in economic paralysis, the bigger the risk it’s to Europe. 

We’ve provided many articles on the evidence of creaking global supply chains fast emerging in China and spreading outwards to places like Asia Pacific countries, Europe, and the US. 

Deutsche Bank said last week Europe is less directly exposed to an initial China supply-chain shock than the US, Canada, Japan, and all the major Asian countries (i.e., India, South Korea, Indonesia, Malaysia, Vietnam).

Still, Europe would be exposed to secondary shocks as the global economy would experience lower trade growth. 

Here’s a chart that maps out lower dependency and higher dependency countries to disruption from China. 

To summarize, the deadly virus has now arrived in Europe, specifically in Italy and France – it comes at a difficult time for the region as recession risks flourish. The European Central Bank’s monetary cannon is widely exhausted and could fail in a bid to shore up the content’s economy.

https://www.zerohedge.com/markets/french-tourism-crashes-30-40-amid-virus-outbreak-europe-recession-watch

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Olivia Kroth
February 25, 2020

“French Tourism Crashes By 35% Amid Virus Outbreak; Europe On Recession Watch” … Never mind! Defender Europe 20 will defend them all!

LOL
LOL
Reply to  Olivia Kroth
February 25, 2020

I think they secretly want to bring more Russian tourist soldiers in to revive the Bistros.

Olivia Kroth
Reply to  LOL
February 26, 2020

The French bistros are vivid enough, in fact, they remain very popular meeting places in France, and the Russians are welcome, which is nice.

Yuri
Yuri
February 25, 2020

Great to see this manic world start to slow down somewhat. More to be expected as time goes on, and not just from bio-weapons.

Lyons Tourist Bureau
Lyons Tourist Bureau
February 25, 2020

I thought it already crashed 35% over the yellow vest protests. Is this another 35%? They should start counting the flood of immigrants as tourism. That’ll boost their ratings.

GRE Question No. 434
GRE Question No. 434
Reply to  Lyons Tourist Bureau
February 25, 2020

BTW: If tourism crashed 35% and then another 35%, what was the overall crash percentage?

Olivia Kroth
February 26, 2020

Not only in France tourism crashes due to the corona virus, but also in Italy. TASS: Coronavirus hits Italy cutting short Venice carnival, as towns go on lockdown — Police manned checkpoints around quarantined towns in Italy’s north and residents stocked up on food as the country became the focal point of the outbreak in Europe Italian authorities announced that there are over 200 confirmed cases of COVID-19 disease in the country At least 229 people in Italy have tested positive for the COVID-19 virus and six people have died. Police staffed checkpoints around quarantined towns in Italy’s north on… Read more »

Olivia Kroth
Reply to  Olivia Kroth
February 26, 2020

TASS: Russians cancelling tours to Italy over coronavirus fears — Italy is at the moment the European country worst affected by the coronavirus MOSCOW, February 25. /TASS/. Russian tourists have started requesting cancellation of their earlier booked tours to Italy, which is at the moment the European country worst affected by the coronavirus, the Association of Tour Operators of Russia (ATOR) said in a report on Tuesday. “Reports about coronavirus cases in northern Italy circulated by the media have sparked concerns of the tourists planning their holiday in that country. Tour operators are reporting numerous requests for cancellation with the… Read more »

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