EU internal market under pressure as Covid-19 shuts borders

The European Union’s single market was under increasing strain as border closures by member states to curb the spread of Covid-19 disrupted the flow of trade.

The European Commission said border checks between EU countries could be in place for some time, as member states prepared to bar non-essential travellers from the rest of the world from entry.

“I think it will take quite a while still until we see the lifting of the internal border,” commission president Ursula von der Leyen said after a discussion with EU leaders.

Countries from Spain to Germany have closed their borders to non-residents as they try to get control of rapidly increasing cases of infection, which have risen to 31,506 in Italy, 11,748 in Spain and 9,352 in Germany.

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In Italy, the disease is killing hundreds of people a day with a total death toll of 2,503, while in Spain deaths jumped by 191 on Tuesday to 533.

A cascade of border closures has left citizens stranded across the continent, from holiday-makers in Spain and France to commuters and overseas workers trying to make their way home.

Poland's abrupt closure of its border caused queues of up to 40km on the major European goods artery of the A4, which runs from Poland to the Netherlands through Germany.

Temperature checks

Truck drivers, Polish citizens and people with residence permits are permitted to enter Poland, but the identification and temperature checks on arrival caused day-long traffic backlogs.

The move also cut off thousands of citizens of the Baltic states of Estonia, Latvia and Lithuania who work in Germany and are trying to make their way home. The Baltic states are now negotiating for convoys of their citizens to be allowed free passage through Poland.

"The Polish decisions on border and quarantine procedures have basically cut off the three Baltic countries from mainland Europe. They also pose problems for the transport of goods and supply chains," said a senior EU diplomat. "The situation is getting very difficult very quickly. It is now of utmost importance to create corridors for the transit of people and goods through Poland."

The EU has appealed for free passage lanes for trucks at borders to prevent blocks on supply.

“We have to be very careful with our single market,” said Ms von der Leyen. “In the economy it’s the most precious instrument we have, so it’s of utmost importance that we keep it going.”

The internal market had previously been put under strain as France and Germany limited exports of respiratory masks, which have been in short supply since the pandemic caused a surge in demand. The EU has tried to co-ordinate joint procurement of equipment, with limited success.

Student doctors

Italy has scrapped final exams for medical students to rush 10,000 new doctors into service. They are to be put to work in general practice and in homes for the elderly, so that more experienced colleagues can be freed up to work in Italy’s overwhelmed hospitals.

With the pandemic threatening severe economic damage and a global recession, the EU eased its rules to allow companies to receive state grants up to €500,000 or guarantees on bank loans to ensure liquidity.

Spain announced a package of €200 billion to help companies and workers, as prime minister Pedro Sánchez declared "Nobody will be left behind". French president Emmanuel Macron vowed no country would be allowed to go bust, as Paris prepared to pump €45 billion of crisis measures into the economy to help companies and workers.

The Netherlands announced it would spend between €10 and €20 billion to prop up its economy after its central bank warned of recession. The government promised to pay up to 90 per cent of the wages of workers at companies that take a substantial turnover hit to avoid layoffs, and allowed firms to defer tax payments.