Austria Re-Imposes Full Lockdown, Vow "Penalties" For Those Who Resist; Germany May Follow

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Austria Re-Imposes Full Lockdown, Vow "Penalties" For Those Who Resist; Germany May Follow

ZH | NOV 19, 2021

Austria will become the first country in western Europe to reimpose a full COVID-19 lockdown starting Monday, November 22, it said on Friday as neighboring Germany warned it may follow suit, sending shivers through financial markets worried about the economic fallout of yet another round of lockdowns, even if some were cynical enough to ask if the whole point of this latest escalation is to greenlight even more stimmies.

Austria also said it would require the whole population to be vaccinated as of February 1. Austrian Chancellor Alexander Schallenberg made the announcements at a press conference on Friday,

Roughly two-thirds of Austria's population is fully vaccinated against COVID-19, and yet its infections are among the highest on the continent, with a seven-day incidence of 991 per 100,000 people.

Following the previously announced lockdown of the unvaccinated, which failed to put a halt to soaring case numbers, the entire country will now be placed under a full lockdown lasting at least 10 days. Also, starting From February 1st, everyone will also be legally required to have been vaccinated. Austrian authorities also said they would make the COVID-19 vaccine mandatory, vowing “penalties” for those who continue to resist.

“We haven’t been able to convince enough people to vaccinate. For too long, I and others have assumed that you can convince people to get vaccinated,” said Chancellor Alexander Schallenberg. "It hurts that such measures still have to be taken."

He also vowed to impose “penalties” on those who still refuse to get vaccinated, although these weren’t specified.

What are the main rules of the lockdown?

• From Monday, November 22nd, Austria will go into a three-week lockdown, which will end on December 12th.
  
• Shops and restaurants will be forced to close.
  
• Working from home will be mandatory in any job where it is possible to do so.
  
• FFP2 masks are mandatory in all enclosed rooms.
  
• Schools will not be officially closed but will remain open for “those who need them”, although face-to-face lessons will not take place.
  
• This mirrors rules from lockdowns in 2020, where schools moved to distance learning but still provided care for students whose parents were unable to do so, for example young children of parents working essential jobs or those with extra learning needs.
  
• The government called on parents to return to home-learning if at all possible.
  
• The suite of measures will be evaluated after ten days.
  

It’s likely that Austria will follow the United States in attempting to make vaccination compulsory for having a job, even though much of the Austrian public is highly sceptical about vaccines. It is planning a protest against coronavirus restrictions on Saturday.

Meanwhile, a fourth wave of infections has plunged Germany, Europe's largest economy, into a national emergency, Health Minister Jens Spahn said. He urged people to reduce their social contacts, warning that vaccinations alone would not reduce case numbers.

Asked if Germany could rule out an Austrian-style full lockdown, Spahn said: "We are now in a situation - even if this produces a news alert - where we can't rule anything out. "We are in a national emergency," he told a news conference.

Numerous other countries, including Germany, Italy, Slovakia and the Czech Republic, are all about to implement new restrictions in an effort to combat a “fourth wave” of the virus.

Europe is currently experiencing its highest ever COVID surge, with 310,000 cases being registered across the continent over the last 24 hours. Ireland is also on a “war footing” and could be about to introduce a new lockdown despite having a 94% vaxxed population, mandatory mask mandates, and a vaccine passport scheme already in place.

One country which is coping noticeably better than the rest of Europe is Sweden, which never imposed any strict mask mandates or legal lockdown.

European stocks retreated from record highs, while government bond yields, oil prices and the euro tumbled as the spectre of a fresh COVID-linked lockdown in Germany and other parts of Europe cast a fresh shadow over the global economy. read more

As cases rises again across Europe, a number of governments have started to reimpose limits on activity, ranging from Austria's full lockdown, to a partial lockdown in the Netherlands, to restrictions on the unvaccinated in parts of Germany, the Czech Republic and Slovakia.

Hungary reported 11,289 new COVID-19 cases on Friday, its highest daily tally, and will make booster shots mandatory for all healthcare workers and require mask wearing in most indoor places from Saturday.

While the new measures across Europe are not seen hitting the economy as much as the all-out lockdowns of last year, analysts say they could weigh on the recovery in the last quarter of the year, especially if they hit the retail and hospitality sectors.

A full lockdown in Germany would be more serious, however.

"A total lockdown for Germany would be extremely bad news for the economic recovery," said Ludovic Colin, a senior portfolio manager at Swiss asset manager Vontobel. "It's exactly what we saw in July, August of this year in parts of the world where the delta (variant) was big, it (COVID-19) came back and it slows down the recovery again," he added.

The pressure on intensive care units in Germany had not yet reached its peak, Spahn said, urging people to reduce contacts to help break the wave.

"How Christmas will turn out, I dare not say. I can only say it's up to us," he added.

Chancellor Angela Merkel said on Thursday Germany will limit large parts of public life in areas where hospitals are becoming dangerously full of COVID-19 patients to those who have either been vaccinated or have recovered from the illness. Merkel said on Thursday the federal government would consider a request from regions for legislation allowing them to require that care and hospital workers be vaccinated.

Saxony, the region hardest hit by Germany's fourth wave, is considering shutting theatres, concert halls and soccer stadiums, Bild newspaper reported. The eastern state has Germany's lowest vaccination rate.

New daily infections have risen 14-fold in the past month in Saxony, a stronghold of the far-right Alternative for Germany (AfD) party, which harbours many vaccine sceptics and anti-lockdown protesters.