In drastic step, Italy shuts most factories to halt virus

 Italy has become first western developed nation to idle most of its industry to halt spre of coronavirus, in a potential cautionary tale for or governments, such as Trump ministration, that are resisting such drastic measures.

After more than two weeks of a nationwide lockdown, Italian government decided to expand mandatory closure of nessential commercial activities to heavy industry in eurozone's third-largest ecomy, a major exporter of machinery, textiles and or goods.

move by Italy, which is leing globe in virus deaths, is more in line with draconian measures taken by China than with declarations coming out of or democratic partners, who are at least a week or two behind Italy’s rate of virus infections.

industrial closures put in stark contrast concerns over protecting lives in a country with an especially vulnerable aging population against fears of hurting an ecomy that alrey was on brink of recession.

industrial lobby Confindustria estimates a cost of 70 billion to 100 billion euros ($77 billion-$110 billion) of national wealth a month if 70% of companies are closed, as anticipated. Though some big companies h alrey suspended activities, thousands of smaller manufacturers h continued after opting new safety regulations, and will w shut down.

“We are entering a war ecomy,’’ said Confindustria President Vincenzo Boccia.

Ecomists grow dizzy speculating on possible ecomic drag in a country that never fully recovered from back-to-back recessions last two deces. UniCredit bank's chief ecomist, Erik Nielson, expects ecomy to shrink by a staggering 5% to 15% this year - and that assumes a recovery toward end of 2020 and takes into account a 25 billion-euro aid pack and 350 billion euros in credit lines. Italian Treasury has put virus hit at 5% to 7% of GDP in 2020.

‘’ ecomic consequences of suspensions risks to be unsurmountable, because continuity of companies is being interrupted for a substantially undetermined period,’’ Il Sole 24 Ore, respected business daily of Confindustria lobby, wrote Thursday.

government decree mandates industrial shutdown for one week, but as with rest of harsh containment measures y are likely to be extended depending on pace of contagion.

It's a sobering prospect for or countries in Europe and for United States, where President Donald Trump has said he aims to have commercial businesses reopen by mid-April, despite warnings from health experts that that is unlikely. re has been discussion of closing U.S. manufacturing as a nationwide measure.

Unions in Italy have fought especially hard to have more sectors considered nessential in order to protect workers. y won limits on activity at call centers as well as production of wood and plastic packaging, paper and chemical products.

powerful CGIL union confederation h said government’s initial list counted 800,000 companies as essential, with workers numbering 7.5 million, or 57% of workplace.

Italy’s moribund car industry has alrey been idled voluntarily, with Fiat Chrysler shutting down most of its Italian production and Ferrari converting a part of its factory to help make respirators. tourism industry has been at a standstill for a month, and struggling Alitalia is virtually shut down. All n-essential commercial and retail activity was shuttered more than two weeks ago.

Premier Giuseppe Conte anunced new industry closures this weekend, citing biggest emergency country has faced since World War II. Industrial activities allowed to continue include any activity related to health care, agriculture and food production.

Under measures, fashion house Pra said it will start producing 80,000 medical overalls and 110,000 masks for health care workers. Work on a Gea bridge to replace one that fatally collapsed in August 2018 - considered of strategic importance - continued, while that on Italian side of Brenner Base Tunnel, which will be longest rail tunnel in world when completed, was suspended along with work on Italian side of a high-speed rail tunnel to France.

In all, hundreds of thousands of small, medium-sized and large companies will be closed, with workers receiving partial salaries under short-term unemployment schemes that have been extended to even smallest businesses.

y include Pirelli tiremaker, with Italy accounting for just 6% of global production, and Luxottica, largest eyewear manufacturer in world whose brands include Ray-Ban and Oakley.

big concern for small and medium-sized company owners that power Italy's ecomy is how long shutdown will last, and how hard that will hurt cashflow and hinder a smooth return to business.

"If shut-down is two or three months, it might be as simple as turning a light back on, because supply chains and logistics are very efficient,’’ said Carlo Salvato, an expert in small and medium business at Bocconi University. ‘’But if shutdown is longer and precipitates a deep slide in wealth, patterns of consumption could change dramatically."

Olivari is a family-run maker of door handles based in rrn province of vara that survived two world wars, during which it was converted to munitions production due to its expertise with brass and aluminum. But in this shut down - despite war metaphors - re is war machine to balance losses from forced closure.

Antonio Olivari, he of research and development, said business, which counts 80 workers and annual revenue of 15 million euros, can bounce back from two weeks or a month of a shut down. “It makes sense to produce w anyway, with hardware stores and or channels closed,” he said. But if it drags on for months, issues emerge, like salaries.

And people's priorities and habits could be different after this crisis, Olivari said. ‘’Will people still want to invest in finishing or remodeling a home? re may be or priorities. It will be an amaly that we have never experienced.’’