Merkel to address nation on coronavirus, Germany mulls new economic steps

Germany is looking at additional steps to help firms hit by the coronavirus, Finance Minister Olaf Scholz said, and Chancellor Angela Merkel prepared to address the nation on Wednesday to urge people to adhere to social distancing measures.

Scholz, who tweeted that he was working from home due to a heavy cold and was "getting tested to be on the safe side", told weekly newspaper Die Zeit the government was looking at how it could directly support some companies affected by the virus. "If, for example, rent has to be paid for business premises that cannot be opened because of the coronavirus, then it will be necessary for us to help," he said, adding that Berlin could also help airlines, cruise operators and trade fair businesses.

Scholz and Economy Minister Peter Altmaier already promised half a trillion euros in guarantees for business last Friday - and more if needed - in a four-point plan to tackle the economic impact of the epidemic. Germany's Robert Koch Institute said there were 8,198 cases of coronavirus in Europe's largest economy.

The institute's president, Lothar Wieler, told reporters that if Germany does not manage to reduce contact between people for several weeks "then it's possible that up to 10 million people in Germany will become infected". That would overburden the health service, he added.

Merkel's address to the nation on Wednesday evening will be the first time in nearly 15 years in office that she has spoken to the country other than in her annual New Year's address. "It's about what needs to be done in Germany now to slow down the spread of the coronavirus and how everyone should participate," her spokesman tweeted.

Merkel's government has advised the country's 16 regions to shut schools and daycare facilities until the end of the Easter holiday. Shops, except for grocery stores, bakeries, pharmacies banks and other essential businesses have been shut. Earlier, Germany's banking regulator BaFin said it was cutting capital requirements to boost bank lending.

The city state of Berlin was separately considering grants of 15,000 euros to the self-employed who were not eligible for any other kind of crisis support, Tagesspiegel newspaper reported, adding that they expected some 20,000 applications. Clemens Fuest, president of the Munich-based Ifo institute, said that if economic activity falls to 65% of normal levels for just two months and then grows again as expected, economic output for the year as a whole would shrink by 5%.

"That would be a slump like the 2009 financial crisis, but it could also be much worse." (Additional reporting by Michelle Martin, Joseph Nasr, Madeline Chambers and Thomas Editing by Alexandra Hudson)

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