This story is part of a major Financial Times series, investigating the global response to the crisis and whether the disaster could have been averted.
For many Europeans the moment coronavirus arrived on their continent was on February 23 when Italian authorities quarantined 10 small towns south-east of Milan. They watched, agog, as the carabinieri cordoned off access, trapping residents inside their infected neighbourhoods.
Few had imagined that the kind of draconian controls imposed by China in Wuhan would be necessary or indeed feasible in a European democracy. The lockdown of Lombardy's "red zone" should have punctured any complacency. And yet it took another two to three weeks for governments across the continent to appreciate the scale of infection in their own countries and take sweeping measures to contain it.
Some countries coped admirably with the first wave — or had the good fortune of minimal exposure to the virus. Others were hampered by poor preparedness, indecisive leadership and discord between central, regional and local governments. Nations squabbled and failed to learn from each other. The EU itself wobbled under the strain. These are five of the key moments that shaped Europe's early response — and, in some cases, continue to plague its handling of the pandemic as a second wave crashes over the continent.
AN EARLY LESSON
Italy
Last December, when Pietro Poidomani, a general practitioner in the town of Cividate al Piano in Lombardy, began to notice patients with high fevers, he wondered if the flu vaccine that year had been faulty. Some had severe coughs, while others were suffering from what appeared to be pneumonia. "We had started to see some strange things, different from usual but also similar in some ways to the seasonal flu," he remembers.
It was not, however, until more than three months later that the arrival of a young patient in a small hospital in Codogno, 50km south of Poidomani's surgery, would shock Italy. The patient's admission set in train a series of events that would shape the early global response to the Covid-19 pandemic.
Three days after his arrival, at 9.20pm on February 20, the 37-year-old, referred to at the time only as "Mattia", became the first person in Italy to test positive for Covid-19. The condition of this young, healthy man, whose wife was eight months pregnant, quickly worsened, and he was moved to intensive care. Days later, Codogno, along with a cluster of small nearby towns in Lombardy and one in neighbouring Veneto, were placed in lockdown.
In less than a month, the region's hospitals were flooded with cases, and footage of dead bodies being removed by military trucks was beamed across the world. Events there helped trigger a sharp about-turn in how to tackle the virus as far afield as London and Washington DC.
"Many scientists in Europe had until then been analysing data from China and Korea, and the assumption was that coronavirus would end up being relatively mild. This was the message being conveyed to policymakers," says Igor Rudan, chair in international health and molecular medicine at the University of Edinburgh. "Then Lombardy happened and it was our worst nightmare. We could not make sense of the numbers in Italy — the deaths were just so high. Everyone suddenly started questioning everything they had thought up to that point."
Doctors, experts and local officials now believe that the horror that unfolded inside Lombardy's hospitals in March — prompting scientists to sharply revise up their predictions of likely deaths, and governments to scramble to build special Covid-19 hospitals — was shaped by a series of small but critical local decisions that would have a global impact.
Coronavirus: Could the world have been spared?
• Part 1: China and Covid-19: What went wrong in Wuhan
Days after "Mattia" had tested positive, a flustered Giuseppe Conte, Italy's prime minister, criticised the hospital in Codogno for failing to contain the virus. The facility, Conte said, had not followed "the prudent protocols that are recommended in these cases, and this has certainly contributed to the spread". He warned that Italy's central government was ready to step in if needed.
Attilio Fontana, Lombardy's regional governor, who under the country's devolved healthcare system had responsibility for the hospital, took Conte's words as a direct challenge to his authority. But he was also now under immense pressure to show Lombardy's prized health system was up to the task. It was during these critical days in late February and March that the region's hospitals, which are ranked among the best in Italy, began to be flooded with Covid-19 patients.
Niccolò Carretta, a regional councillor in Lombardy, says the health system responded very quickly, doubling the available intensive care beds in a few days. But, he argues, the region lacked an early-warning system. "Because of the region's more centralised system of large hospitals, partly private, and with fewer and fewer equipped general practitioners on the ground, this is one of the reasons why we were not able to anticipate what was coming," he says. "We realised in a few days that we were full of Covid-19 patients up to our necks."
For Poidomani, the GP in Cividate al Piano, the symptoms he had started noticing in December now made worrying sense. The virus had in fact been spreading around Lombardy for months already, meaning the hospitals now risked becoming incubators for the disease they were trying to treat. "I realised that, actually, all those cases that we had mistaken for flu then turned out to be Covid-19. The virus had already filled the whole territory with such a load that it broke through the barricades of our health system," he says. "Some hospitals became hotbeds themselves, turning into real time bombs."
Rudan believes that in the rush to treat patients, too many were admitted into hospital in a short space of time. This resulted in a vast increase in infections among vulnerable populations. "I would not blame anyone here. Things were happening way too quickly and it resulted in a tragedy," he says. "But when you bring people with Covid into small hospitals where there are very vulnerable people, it will result in far higher deaths."
By the second week of March, the number of patients in hospitals in Lombardy was surging. Out of about 750 intensive care beds, more than 600 were full, with doctors terrified that the system was already approaching breaking point. Many patients were being put on ventilators and many were dying. Scientists around the world, who were still operating with limited data, were alarmed by the extremely high mortality rate — running at over 5 per cent of diagnosed cases in Lombardy at that point — and the vast numbers being admitted to intensive care units.
The virus broke through the barricades of our health system. Some hospitals became hotbeds themselves, turning into real time bombs." - Pietro Poidomani, a Lombardy GP
"When people started to see what was happening in Lombardy's hospitals, a lot of the planning and expectations for the virus quickly changed," says Paul Hunter, a professor of health protection at the University of East Anglia. "Many, including myself, at that point thought we were facing a threat more like Sars but we were shocked by the rapid spread and severity of the epidemic. The fact this was going to be different was really hammered home by the events in Italy."
After inputting this information into their models, a group of scientists, led by epidemiology professor Neil Ferguson at Imperial College London, published a bombshell report on March 16. They predicted that ICUs in the UK would quickly reach capacity, and hundreds of thousands would probably die. In the US, the number of deaths was predicted to hit 1.2 million. "This conclusion has only been reached in the last few days," the report said, "with the refinement of estimates of likely ICU demand due to Covid-19 based on experience in Italy and the UK."
From Whitehall to Washington DC, governments started to shift course. "How much that specific report influenced government policy is hard to know for certain, but the data from Italy was critical in changing perspectives about what was about to happen in Europe," says Hunter. "This was Europe, not a faraway place, and for both politicians and scientists, having this happening so close to home had a big impact."
Back in Codogno in late March, "Mattia" was taken off a ventilator, regained consciousness and was discharged from hospital. The world he walked out into had been transformed.
- by Miles Johnson and Davide Ghiglione in Rome
THE DANGER OF DELAY
Spain
The doctor leading Spain's efforts against coronavirus could not have been clearer. "There is no virus in Spain," said Fernando Simón, head of the country's health emergency co-ordination centre, on February 23. "The disease is not being spread, nor at present is there any case."
At that time, Spain's experience of coronavirus — such as it was — seemed to be receding into the rear-view mirror. The country had logged a grand total of two infected people — both had contracted the virus outside Spain and since recovered. "The situation is frankly good," Carmen Calvo, the deputy prime minister, said on February 25. In fact, it was already very bad.
Simón was wrong to insist there were no live cases or community transmission. At that moment, coronavirus was spreading fast in Spain, soon to be hit harder than any other country in the EU. The problem was that public health procedures made it impossible to track the full extent of the pandemic.
I've been practising for 30 years. Here in the hospital we have had to treat missionaries with Ebola — Ebola was nothing compared to this." - José Ramón Arribas, head of the infectious diseases unit at Madrid's La Paz hospital
On February 25, Spain reported that an Italian couple holidaying in Tenerife had tested positive. Local officials acted swiftly, placing several hundred people staying in the same hotel under quarantine. More seriously, infections were already spreading undetected in Spain's biggest cities.
The country was flying blind. It turned out to be a critical failure — one repeated elsewhere in Europe and beyond. Spain's response to coronavirus was hampered by a highly partisan political atmosphere and a regionalised healthcare system that lacked central co-ordination. But its inability to chart the early spread of infection and consequent delays in locking down also contributed to a tragic outcome: Spain has the second highest death toll in the EU after Italy.
Today, as Spain wrestles with a second outbreak that is again among the worst in Europe, the debate over what went wrong in the spring — and how much the government was to blame — is more relevant than ever. "It has been a systematic failure by the country," says Pedro Alonso, a Spanish epidemiologist at Barcelona university.
Within a month of Simón's statement, Spain was registering 10,000 cases a day. The true level of contagion, he later acknowledged, was probably 10 times greater: according to official estimates, more than two million people were infected during the pandemic's first wave. By the first week of April, overloaded hospitals were putting beds in gyms, corridors, libraries and tents. In Madrid, the worst-affected part of the country, the number of people requiring intensive care was roughly three times pre-pandemic capacity, forcing hospitals to install makeshift ICUs in operating rooms and respiratory units.
"I've been practising for 30 years. Here in the hospital we have had to treat missionaries with Ebola," says José Ramón Arribas, head of the infectious diseases unit at Madrid's La Paz hospital. "Ebola was nothing compared to this."
Until the last days of February, diagnostic tests were almost entirely limited to people who had travelled from or were connected to Hubei province in China, where the pandemic originated. This was in line with other European countries but it proved a big mistake.
"We wanted to do more diagnostic tests, especially of patients who were being hospitalised with pneumonia, but they were only authorised for people who came from Wuhan," says Arribas. "There was a discrepancy between what we in the hospitals asked for — more PCRs [tests]— and what the public health officials recommended... They insisted that the risk in Spain was very low."
The restrictions on testing made it impossible to detect whether people were spreading the virus in the country itself. It turned out they were, in large numbers. "It's a basic error of public health," says Alonso. "You only see what you are looking for. If you prohibit people from looking for something, you will never find it. And that's exactly what happened in Spain in these critical, critical weeks."
In fact, a later postmortem examination revealed a patient with coronavirus had died on February 13.
The holes in the data and the flawed testing protocol led to a fatal complacency. Critics say that both national and regional authorities were too slow to impose controls — mistakes they would go on to repeat this summer when restrictions were relaxed and a second wave of infection took hold.
"What was happening in Italy gave us almost two weeks' notice," says Arribas of La Paz hospital. "But we did not prepare enough." Even after Italy imposed a lockdown on 16 million people in the north of the country, it took several days for the Spanish government to put similar restrictions in place. Speaking on Sunday March 8, hours after Rome's dramatic intervention, Salvador Illa, Spain's health minister, described the Italian lockdown as "very drastic", adding: "We ourselves do not need such measures today."
That same day, the leftwing government permitted a 120,000-strong International Women's Day march in Madrid — a decision that rapidly became a political football. The hard-right Vox party depicted it as a criminal act carried out in the name of feminism, although many epidemiologists say the march was not an important spreader of infection. What really mattered, according to Miquel Porta at Barcelona's Municipal Institute for Medical Research was that almost three million people were cramming into Madrid metro and commuter trains each day — and millions were also piling into the city's bars and restaurants.
Reports had already begun to come into the health ministry indicating that Spain itself was experiencing a surge in infections. Official figures for March 8 showed that the number of registered cases had increased by 70 per cent in just 24 hours, reaching a total of 999. "We were seeing an exponential increase in patients," says Arribas. "The hospitals began to fill up very quickly indeed."
On March 9, several regions, including Madrid, announced the imminent closure of their schools. On March 12, José Luis Martínez-Almeida, the mayor of Madrid, suggested that the city might have to be shut down. But the Spanish government only agreed to a lockdown two days later.
"It was only when the tip of the iceberg led the hospitals to collapse that they declared the state of alert," says Alonso. "But it was only the tip and underneath it there was an enormous level of transmission."
Simón maintains that "only a few days" are at issue in terms of how long it took the government to react. "Our information did not indicate until the morning of Monday March 9 that there was any need to close anything down… Could we have acted earlier? It is very difficult to judge," he told the FT in June. "People can say it could have been a day before or a day later but we did things very well."
- by Daniel Dombey in Madrid
CARE HOME CATASTROPHE
France
When French President Emmanuel Macron visited an old people's home in Paris on March 6, he had an urgent public message to deliver: protect the vulnerable from coronavirus. "I know it's sometimes heartbreaking, but we must do our best to avoid visiting our elderly," he said.
He talked of hygiene and warned against physical touching, but neither visitors nor residents nor staff were wearing face masks, which was not yet official policy. At the time, France had officially recorded only nine deaths from Covid-19, including the first fatality announced in Europe, an 80-year-old Chinese tourist from Hubei province.
Macron knew the old were much more vulnerable than the young, but he and the health officials and carers around him had little inkling of the catastrophe that was already sweeping through care homes in France and across the continent. Within weeks, thousands would be dead. "People didn't realise what was happening," says Tatiana Dubuc, a 35-year-old carer and trade union representative for a group of six public care homes in the northern French port of Le Havre. "Residents died of suffocation."
Dubuc and others describe chaotic situations in some of France's 7,400 old people's homes in March and early April. Masks and other protective equipment were in desperately short supply, staff were sick or absent, very few tests were available and overburdened hospitals sometimes turned away patients. "We were at war, but we had no weapons," she says. "They let our old people die." Dubuc believes the Ehpads, an acronym for établissements d'hébergement pour personnes âgées dépendantes or institutions to shelter the dependent elderly, "were left to their fate".
France was among the first countries in Europe to realise the devastation wrought by Covid-19 in old people's homes. The health authorities began reporting deaths there separately from hospital deaths as early as the end of March. By mid-October, the statistics showed 10,856 of the country's 33,037 Covid-19 fatalities had died in care homes. The real toll, however, is higher because some died in hospital and others were never tested for the virus. In the homes where Dubuc works, she says there have been 92 suspect deaths, of which 50 were confirmed to be from coronavirus.
Olivia Mokiejewski describes how her previously healthy 96-year-old grandmother Hermine, who had looked after her as a child, died in hospital on April 4. She caught the virus in the Bel Air Ehpad near Paris. The institution is run by Korian, a listed company that is the biggest care home operator in Europe. Mokiejewski and other relatives of residents accuse some staff of failing to take proper preventative measures, hiding Covid-19 infections when they appeared and not looking after the sick adequately.
"It was the conditions they died in, not that they died of Covid, that was the problem," she says. "These people were abandoned… Covid just unveiled the problems of lack of care and lack of resources in the Ehpads." Mokiejewski says her grandmother was finally admitted to hospital in a "catastrophic" state. "She was malnourished and dehydrated when she arrived."
Mokiejewski has now teamed up with 250 families to launch collective lawsuits naming Ehpads they believe neglected their relatives. Fabien Arakelian, her lawyer, says he is handling 40 cases across France. "It's a real public health scandal, and we're only at the start," he says.
Korian declined to respond to specific allegations because of continuing judicial investigations, but acknowledged there were "very serious problems" in various Ehpads and recalled that government protocols did not require the wearing of masks at the start of the epidemic. "There was no medicine [to treat Covid-19], there was no vaccine," says Jean-Marc Plantade, head of media relations at Korian. "The authorities kept the tests for the hospitals… There were establishments where staff fell ill, in some cases 20 per cent of them in 24 hours. It's the virus that kills, it's not Ehpads, it's not Korian."
At least two of France's private care companies, in a healthcare sector that has expanded rapidly in the past three decades, were given early warning of the unfolding global disaster because they had care homes in China. "At the end of January we were warned by our teams that there was a Sars-type disease circulating around Wuhan," says Jean-Claude Brdenk, chief operating officer of Orpea, the world's biggest private operator of care homes, which manages an old people's home south of Wuhan.
Orpea, which has 65,000 staff worldwide, started closing its 240 French Ehpads to visitors more than a week before the government ordered a shutdown. It organised training and protocols, scrambled for supplies of medical equipment and braced itself. "I was thinking it would come from Italy, so I really watched Provence [near the Italian border in southern France], but in the end it came straight to Paris from the east of France," Brdenk says.
Orpea's residents were not spared either. It recorded its first positive case on March 12 and says 2,600 of its 18,500 residents in France were infected, of whom 416 died between the beginning of March and the end of July. Since then it has had just 16 coronavirus deaths. Brdenk says the company has so far been the object of no formal legal complaints.
Doctors, carers and government officials insist privately that it is important to put the tragedy of the pandemic among the elderly in perspective. In a typical year about 180,000 of the 700,000 people in French care homes will die from influenza and other causes. The nation's peak daily death rate during the deadly heatwave of 2003 greatly exceeded the worst days of the coronavirus pandemic in March and April, according to the statistics institute Insee.
The real tragedy for the elderly was twofold: some died gasping for breath because few homes have the oxygen equipment required for seriously ill Covid-19 patients; and survivors, many of them already disoriented or with dementia, have been deprived of family visits and close contact with their carers by measures to stop the spread of the virus.
Opposition politicians and some care home executives have sharply criticised Macron's administration for its handling of the pandemic, including what they say was its narrow focus on hospitals rather than vulnerable old people's homes. Synerpa, the federation representing private care homes, said it received "zero response" when it wrote to then health minister Agnès Buzyn on February 4 making recommendations on how to handle the crisis.
At the Elysée, Macron's advisers accept that there were shortages of equipment and that the government was taken aback by the rapid spread of the epidemic. "All the problems not resolved before Covid exploded during the pandemic," says one official dealing with health policy.
But Macron, they say, was acutely aware of the vulnerability of Ehpad residents. "The president came to me every day and said, 'What is happening in the Ehpads?'" says the official. "The rule was that no Ehpad should be left on its own."
The first severe Covid-19 wave in the spring struck hardest in the east and in the Paris region. Only three weeks after Macron's Ehpad visit, the health authority in the Grand Est region bordering Germany said two-thirds of its 620 old people's homes had been affected by coronavirus and 570 residents had died.
In the latest surge of infections, it is the cities of Paris, Lyons, Marseille and Lille that have so far been worst affected. This time, however, the old people's homes are better equipped and prepared.
Even so, more elderly residents are certain to die from coronavirus. Of the 1,512 Covid-19 active infection "clusters" recorded by the authorities in mid-October, 293 were in Ehpads. "There's a real fear that Covid will return," says Dubuc, the carer in Le Havre.
- by Victor Mallet in Paris
THE PROTECTIONIST IMPULSE
Germany
In March, Joachim Missfeldt, head of a Swiss medical supply company, found himself at the centre of a diplomatic crisis. His business, Akzenta, had a commodity Europe desperately needed in those early days of the Covid-19 pandemic — face masks from Asia.
However, much of its stock was stored not in Switzerland but in a warehouse in Freiburg, in south-west Germany. And earlier that month Germany had taken an extraordinary measure to protect its dwindling supplies of PPE. On March 4, Angela Merkel's government banned the export of all protective medical equipment. The order was wide-ranging, from goggles, gowns and coveralls to face shields, gloves and surgical masks. The move left Akzenta unable to supply European customers from its German warehouses. "It was like a bolt from the blue," Missfeldt says. "And a massive slap in the face."
The ban was rushed through amid genuine fears that Germany was about to run out of the most basic medical supplies, just as the pandemic hit Europe's largest economy with full force. It coincided with other emergency measures, such as an order to hospitals to postpone elective procedures, boost intensive care capacity and free up beds. But the ban quickly triggered a massive backlash. German authorities started impounding large consignments of masks and gloves that were being stored in or transited through their territory — even when they had been bought and paid for by other countries.
EU neighbours were outraged. Some accused Berlin of undermining the EU's single market, which Germany had always upheld as one of the bloc's greatest achievements. Similar charges were laid when, later the same month, Germany unilaterally closed its western borders, a move that critics said fatally undermined the Schengen passport-free travel zone. It seemed that some of the pillars of European unity were crumbling.
Ever since, Germany has been seeking to undo the damage inflicted by these early measures. It quickly modified and then lifted the export ban. Its hospitals took in 229 Covid-19 patients from France, Italy and the Netherlands. On March 19, Germany delivered 7.5 tonnes of aid to Italy, including ventilators and anaesthetic masks. But to this day, Berlin remains embarrassed by the export stop and the ill-will it caused. "It was very unfortunate," says one senior government official.
That is a view shared by Karl Lauterbach, health spokesman for the Social Democrats and one of the public faces of Germany's emergency response. "In retrospect it was a mistake," he says. The idea of building up "autonomy" in supplies of equipment "is always a bad idea when you're dealing with a pandemic, where cross-border co-operation is incredibly important".
"You can't fight a pandemic with unilateral action on a national level — only through big regional alliances, which is what Europe is," says Kordula Schulz-Asche, health spokeswoman for the opposition Greens.
Missfeldt's company specialises in simple medical supplies such as protective aprons, dental chair covers, exam table drapes and face coverings. In early March, it had plenty of the goods that hospitals and doctors were crying out for but Missfeldt was at a loss as to how to react. Warned by lawyers that the ban could stay in force for months, he started selling his products at giveaway prices to German firms. "It was economic lunacy," he says.
One customer affected was Dispotech, a supplier of medical disposable products. The company is based in Gordona, about 100km from Bergamo, one of the early centres of the pandemic. Demand for masks was going through the roof.
With Dispotech and others left in the lurch, the export restriction threatened a crisis in German-Italian relations. Akzenta's customers complained to the Italian embassy in Berlin and a diplomat rang Missfeldt. "He was hassling me like mad, accusing us of holding up deliveries," he recalls. "I told him there was nothing we could do."
The German blockade, which was imposed just as Russia, Cuba and China were sending emergency aid to Lombardy, fuelled a sense that Italy was being abandoned in its hour of need by its closest allies. There was fury too at Germany's refusal to countenance "coronabonds" as a way to save Europe's ravaged economy. "In the land of Angela Merkel, who boasts the title of Europe's leader, the community spirit is dying," wrote Italian newspaper Il Giornale on March 13.
One incident in particular grabbed public attention: just two days after Berlin's ban came into effect, a lorry containing more than 240,000 protective masks was seized by German customs officials before it could cross the Swiss border. It was one of many such hold-ups. Swiss officials worried that the country might run out of equipment. "We weren't far from [doctors and nurses wearing] garbage bags, like we saw in the US," says one.
German MPs quickly became aware of the damage the ban was inflicting. Hearing of Akzenta's difficulties, Marian Wendt, an MP from Merkel's CDU/CSU bloc, appealed to the German health ministry on Missfeldt's behalf. "It was important for me to try to preserve the peace in Europe," he says. "A big conflict was brewing, with the Italians saying the Germans are taking our masks away."
Pressure was also coming from Switzerland, where the authorities launched an urgent diplomatic effort to reverse the blockade. In Bern, the government summoned the German ambassador, Otto Lampe, to complain. Switzerland's ambassador to Berlin also registered concerns.
The efforts worked: a call was brokered between Merkel and Simonetta Sommaruga, the Swiss president. Germany's chancellor promised to lift the restrictions on exports to Switzerland as soon as possible. Finally, on March 12, Berlin modified the ban, allowing for various exemptions. Then a week later, it scrapped it completely. But that was only after the European Commission on March 15 banned exports of all medical equipment from the EU single market to third countries.
Germany's decision to close its western borders took much longer to reverse, even though it elicited a similarly angry response. Other EU states were stunned by the move — especially as Merkel had previously argued against unilateral actions to stop the disease. Days before the border closure, she said that EU countries "should not be isolating [themselves] from each other" and that they needed to adopt a "unified approach that is, as far as possible, co-ordinated [between us]."
Now ministers privately admit that the closures might have been the wrong response. "Look what happened on our border with Poland, where we had 60km queues of lorries," said the senior government official. "The EU single market was severely disrupted — and we can't let that happen again."
Schulz-Asche, the Green MP, says the closures were "completely inappropriate". "When you shut borders, social, professional and economic contacts collapse." Instead, Germany should have stepped up cross-border co-operation with health authorities in neighbouring countries.
Asked in late August whether the closures would be reintroduced if there was a fresh surge in corona cases, Merkel ruled them out. "The situation is such that we want to react in a much more regional way," she said. "We don't intend to resort to extensive closures again — and I think that if we all make an effort, we can avoid them."
More broadly, Merkel has been prepared to admit that Germany's approach was, at least in the first stage of the crisis, too "national". In a speech on June 18, she said the pandemic had exposed "how fragile the European project still is". "The first reflexes, our own included, were rather national and not consistently European."
Speaking before an official trip to Italy in September, Frank-Walter Steinmeier, the German president, acknowledged that Germany had "experienced, as if by reflex, a retreat inwards". But it had quickly learned its lesson. "Very soon we realised that no country could defeat the virus on its own," he said. "In Europe, aid and support must not stop at borders — borders that are now almost forgotten."
- by Guy Chazan and Sam Jones
FROM DISARRAY TO SOLIARITY
The EU
Emmanuel Macron was being kept guessing. After weeks of assiduous courtship, the French president did not know for sure, as May 18 dawned, how big a leap his political partner Angela Merkel was willing to make to arrest the downward spiral of confidence in the EU and its handling of the pandemic.
In the event, the scale of the shock-and-awe commitment Merkel made alongside the French leader that day stunned not only global financial markets but politicians across Europe. After a frenzied weekend of technical preparations and secret talks, Merkel joined Macron in urging the EU to borrow €500bn to hand out as grants for Europe's economic recovery from the crisis.
The decision was described later by Macron as "the most important since the creation of the euro". It ran roughshod over Germany's traditional opposition to large-scale joint borrowing and re-energised the core Franco-German alliance that drives the European project.
Coronavirus was not just a grave threat to lives and livelihoods, it was also a danger to the EU itself. It risked throwing into reverse many of the bloc's most cherished achievements and destroying a spirit of solidarity, its lifeblood. It took a remarkable act of leadership to turn peril into opportunity. With many EU countries struggling to contain a second wave of infection, following through is all the more important. However, a final agreement on the recovery fund has yet to be sealed and capitals remain bitterly divided over how to attach rule-of-law safeguards. Even if a deal is reached, much will depend on how governments spend the money in the years ahead.
"We were facing the risk of a crisis that could blow up the European Union," says Johannes Hahn, the EU's budget commissioner. "This initiative the European Council agreed to in July can really be a game-changer, but it all depends on how well we implement it. We are by no means through."
The backdrop to May's joint announcement was the darkest period for European co-operation since the bloc's foundation. The early weeks of the outbreak were marked by a series of uncoordinated border closures, bans on exports of some medical products, interruptions to flows of goods through the single market and a leaden-footed response by EU authorities.
What made matters worse was a feeling in the hardest-hit member states, including Italy and Spain, that the EU was indifferent to the appalling human toll the crisis was imposing on their populations. "There was a perception that Europe was missing," recalls one senior EU official. "The mood was horrible — particularly in Italy. [The crisis] was being blamed on the EU, and it was threatening the euro and the single market."
Manfred Weber, the head of the centre-right European People's Party alliance in the European Parliament, says Europe "failed totally" in its early attempts to manage the crisis, as countries scrambled to look after their own interests. In his native Germany, he says, the recognition began to dawn that something had to change — and quickly. "We realised that we cannot have a recovery in our own economy without a recovery in the single market as a whole."
Some measures had been taken earlier in the crisis. In mid-March, the European Central Bank made the decision to purchase an extra €750bn of bonds and in April the EU approved a €540bn package of emergency assistance. But the latter was almost entirely composed of loans. While this would previously have been seen in Germany as more than generous, finance ministry officials in Berlin were beginning to question the country's conservative approach.
Germany had for years enjoyed bumper budget surpluses, allowing it to splurge on emergency aid for its businesses. Countries such as Italy and Spain were fiscally hamstrung, raising the spectre of a worsening north-south economic divide that could tear the EU apart. "We realised we needed to show solidarity," says one senior official.
This recognition underpinned increasingly close Franco-German co-ordination at the highest level, with Merkel in frequent contact with Macron, and Olaf Scholz, the German finance minister, liaising closely with his French counterpart, Bruno Le Maire.
French officials are at pains to point out that Macron had been courting a reluctant Merkel on the issue of a common EU budget since he came to power in 2017. "It wasn't three weeks or three phone calls but three years," says a senior French official involved in the discussions.
What remained unclear until late April was the central role the commission would ultimately play. During the sovereign debt crisis a decade ago, member states opted to leave the crisis-fighting firepower to non-EU institutions including the Luxembourg-based European Stability Mechanism.
This time, however, the commission managed to insert itself at the heart of the response. What helped their plan gain acceptance, says one senior EU diplomat, was the strong personal relationship between the German commission president Ursula von der Leyen and her political patron Merkel, as well as Macron, who last year backed her candidacy for the post. "In the last crisis they didn't trust the commission," says the senior diplomat.
Merkel ultimately agreed to the commission raising debt and paying it out to member states as grants, but the Social Democrats in the German finance ministry had to concede that the recovery fund would be a one-off. That allowed Merkel to sell the idea to her CDU/CSU bloc.
Macron was also forced to compromise — and repeatedly. He had initially backed the idea of coronabonds issued jointly by the eurozone member states, something opposed by Berlin. Then when the recovery fund was first broached, he saw it as a separate entity, but Merkel wanted it within the framework of the EU budget. Eventually, he assented.
French officials involved in the negotiations say that Merkel only gave her formal support to the €500bn in grants — a number that emphasised the scale of the necessary recovery plan — on the morning of her May declaration with Macron.
It took until late July for the EU to ultimately agree a deal, comprising €390bn of grants and €360bn in loans, but French officials see the Merkel-Macron announcement as the turning point in the crisis. "It was a total game-changer," says one.
As coronavirus ripped through Europe in the spring of 2020, it exposed national frailties in terms of a lack of pandemic preparation, slow decision-making and rivalries between central and regional governments. With a second wave of infection now in full swing, many governments are under severe strain once again.
By taking a leap towards closer fiscal union, the EU has emerged stronger than many might have feared seven months ago. But much will depend on how a reinvigorated Franco-German partnership weathers the coming trials — not least because Merkel is in the twilight of her chancellorship. Ensuring the recovery fund is well-spent will be a formidable bureaucratic and political challenge.
"Honestly, nobody knows at this stage if this financial aid or support will be sufficient," says Hahn. "For the moment I think yes. But it needs to be implemented well, and lead to genuine change in the way many of these countries run their economies. There is still a huge political burden on Europe's shoulders."
- by Sam Fleming in Brussels, Guy Chazan in Berlin and Victor Mallet in Paris
Written by: Ben Hall, Guy Chazan, Daniel Dombey, Sam Fleming, Davide Ghiglione, Miles Johnson, Sam Jones and Victor Mallet
© Financial Times
