France promises €45 billion in coronavirus aid and warns of coming recession

French economy minister Bruno Le Maire warned on Tuesday that the country faces recession this year as he announced a €45 billion aid package to help businesses and employees cope with the coronavirus crisis.

France promises €45 billion in coronavirus aid and warns of coming recession
Economy minister Bruno Le Maire said France prepared for an economic recession would follow the coronavirus. Photo: AFP

The government, due to present a series of further support measures shortly, will base them “on a growth forecast of minus one percent, that is to say negative growth,” Le Maire told RTL radio on Tuesday morning.

The forecast was “provisional,” Le Maire said, as he described the coronavirus as “a disaster for all countries, for the G7 and for France,” which would “also lead to recession in the eurozone.”

It was a “economic and financial war” that will last some time, Le Maire said. “It will be lengthy, it will be violent.. this war will require us to mobilise all our forces.”

Le Maire's announcement came the morning after President Emmanuel Macron's second public coronavirus speech in less than a week, where the president promised to protect French businesses through the coronavirus crisis.

Many businesses, especially airlines, have already been hard hit by the financial repercussions of the coronavirus.

Air France has said it will cut capacity between 70 and 90 percent over next two months.

But the new lockdown will have widespread negative economic impact on all businesses, and on the national economy as a whole.

READ ALSO: What exactly do Macron's new coronavirus restrictions mean?

This is why the French government has now stepped up measures to protect businesses and employees through the looming financial slump.
“We won't add fear of bankruptcy and unemployment to the health crisis,” Macron had said during his first speech, on March 12th.
The €45 billion will be used to help struggling businesses and ensure that no employees would lose their salaries during the mandatory period of shut-down.
Ready to nationalise 'if necessary'
The economy minister also said the government was ready to nationalise firms “if necessary” to protect the economy from the fallout.
“I will not hesitate to use any means at my disposal to protect large French enterprises,” the minister said during a conference call with journalists.
“This can be through capital injections or stake purchases. I can even use the term nationalisation if necessary,” he said.
In addition to the already announced tax breaks, businesses can also suspend payments on rent, gas and electricity.

The 'partial unemployment' scheme has also been greatly enlarged so that anyone not able to work because of the crisis can claim benefits, while still having their job held open for them when things return to normal. Employers are barred from firing employees during this period.

Another social measure that has been taken was to extend the traditional winter truce (trêve hivernal), which prevents landlords from evicting tenants during coldest months, by two months after the normal end date on March 31st.
French stock market to tame market volatility
On Tuesday, the French stock market regulator said it was banning short-selling in 92 stocks, a move meant to help tame the massive volatility in the markets caused by the coronavirus epidemic.

“Taking into account the significant losses in recent days on the financial markets, the Financial Markets Authority has decided to take an urgent step,” it said in a statement.

The ban order covers mostly bank and financial stocks.

Investors use short-selling to bet the market will fall, putting tremendous downward pressure on prices at a time when buy interest is virtually non-existent.

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French government calls on over-60s to get second Covid booster as cases rise

As Covid cases show a significant rise in France in recent weeks, the government is calling on all eligible groups to get a second Covid vaccine booster shot.

French government calls on over-60s to get second Covid booster as cases rise

After a 40 percent rise in Covid-19 cases in the last week, the French Health ministry is calling all eligible people – including over 60s and those health conditions – to receive their second booster (fourth dose) of the vaccine.

“It is necessary to redouble our efforts to protect vulnerable people, this is done through vaccination and this campaign of second boosters is absolutely necessary,” said the ministry of health.

The Covid incidence rate is increasing in more than 50 départements across France. Currently, there are an average of 50,000 positive tests per day, which has also been accompanied by an increase in hospitalisations. 

“This is very clearly a reprisal of the epidemic linked to the arrival of new variants of the Omicron family, which are called BA4 BA5,” said infectious disease specialist Anne-Claude Crémieux to Franceinfo. Crémieux added that these variants are faster-spreading.

Therefore, the government is calling on vulnerable people to take their second booster dose (the fourth dose of the vaccine).

So far, only a quarter of eligible people have taken their second booster dose, with an average rate of 25,000 to 30,000 injections per day for the past two months.

“This is not enough, and it is not going fast enough,” urged the Ministry of Health on Tuesday.

The Haute autorité de santé also recently released its recommendation for a vaccination campaign to give a second Covid vaccine booster shot for the wider population, starting in October. 

The HAS recommendation advises starting France’s annual flu vaccine campaign in mid October (mid September for the French overseas territory of Mayotte) and combining it with a campaign to give a second Covid vaccine booster ahead of a possible new wave of Covid in the winter. 

At present although the great majority of the French adult population is vaccinated against Covid with two doses and a booster, a second booster is only recommended for people in high risk groups such as the over 60s and those with long-term health conditions.

The HAS recommendation reads: “At the end of May, the HAS recommended preparing for a booster shot campaign for people most at risk of developing the most severe forms of Covid, and envisaged a booster shot for healthcare workers.

“Those parts of the population most at risk are also those for whom the seasonal flu vaccination is recommended, therefore for logistical reasons the HAS recommends combining the two campaigns.”

The flu campaign is advised to go ahead as normal, starting in mid-October.

The HAS only makes recommendations, the details of policy are up to the government, but it usually follows HAS advice.

The usual seasonal flu campaign in France offers a vaccine for free to anyone in a high risk group, which includes the elderly, people with underling health conditions, healthcare workers and pregnant women – full details HERE on how to get the vaccine.

Those who don’t fit into those categories can still access the vaccine, but must pay for it – €6-€10 for the vaccine and the standard appointment charge to have it administered by a doctor (€25, with 70 percent reimbursed for those with a carte vitale).

The flu vaccine is available from family doctors, midwives and participating pharmacies once the campaign officially launches.

The Covid vaccine is also available from family doctors, midwives and pharmacies, but most of the vaccine centres set up in 2021 have now been closed down.

There is currently no suggestion a return of the health pass, so a second booster shot would be entirely voluntary, but the government has the power to re-introduce such measures if a major wave of Covid hits France over the autumn and winter.

Currently, there are no plans to lower the age minimum (as of now set at 60 years old) for receiving a second booster. Health authorities believe that the immune response after a first booster “continues to sufficiently protect” younger adults.