Italy’s prime minister promised “massive shock therapy” to beat the coronavirus on Monday and urged Europe to act decisively after markets plunged and his country sealed off much of its wealthy industrial north, Reuters informs.
France echoed Giuseppe Conte’s call for action, saying Europe must come up with a “strong, massive and coordinated response” and euro zone finance ministers, meeting next week, must decide on a stimulus plan to avoid economic crisis.
Stocks have fallen worldwide as the virus has spread, cutting global supply lines and crippling industry.
They plummeted again on Monday as prices for crude oil tumbled as much as 33% after Saudi Arabia launched a price war with Russia, sending investors already worried by the coronavirus fleeing for the safety of bonds and the Japanese yen.
U.S. stock futures fell 5% to hit their daily lower limit and halt trading. London’s FTSE 100 shed 8.4 per cent a few minutes after the open in its worst single-day drop since the financial crisis.
In little more than two weeks, the number of recorded coronavirus cases in Italy has surged to 7,375, with 366 deaths, the second-highest death toll after China, putting the health system under huge strain.
“We will not stop here,” Conte told the daily La Repubblica. “We will use a massive shock therapy. To come out of this emergency we will use all human and economic resources.”
He said strict European Union borrowing limits should be loosened to allow more fiscal room for maneuver, and that the flexibility envisaged by the EU’s budget rules should be used “in full”.
“Europe cannot think of confronting an extraordinary situation with ordinary measures,” he said.
The virus emerged in China in December but has since spread around the world. Flights have been canceled, communities from cities to cruise liners have been isolated, and concerts, trade fairs and sporting events postponed. Even the Tokyo Summer Olympics are in doubt.
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