Portuguese parliament clears way for state of emergency over coronavirus

Portugal's parliament gave the green light on Wednesday to decreeing a nationwide state of emergency for the first time in the country's democratic history in an attempt to contain the growing coronavirus outbreak. Possible measures include restriction on movement of people, temporary requisitioning of businesses, suspension of the right to strike and restrictions to protests and public gatherings. Armed forces can be deployed to enforce the measures.

Cabinet ministers will meet on Thursday to decide on exactly what measures will be taken and from when. Portugal has 642 confirmed cases of coronavirus so far, with two reported deaths. Under Portuguese law, a state of emergency is limited to 15 days but can be extended indefinitely in 15-day periods if deemed necessary.

"In fifteen days, despite this move, we will almost certainly have more people suffering from this illness than we do today," Costa said. "The battle against coronavirus is likely to be a lasting one." Also on Wednesday, the government announced a 9.2 billion-euro package to support workers and provide liquidity for companies affected by the coronavirus outbreak.

The package is worth 4.3% of GDP and consists of 5.2 billion euros in fiscal stimulus, 3 billion in state-backed credit guarantees and 1 billion related to social security payments. "Now is the time to combat the pandemic, but also to keep our economy functioning," Finance Minister Mario Centeno said.

Centeno did not spell out what impact the coronavirus and the measures taken to combat it would have on the economy, but said that the unexpected expenditure represented 17.3% of quarterly GDP. This could interrupt Portugal's five-year growth trajectory after its international bailout and threaten 2020's forecast surplus.

Portugal's tourism industry, a key driver of the country's recovery from the 2010-2014 debt crisis and now accounting for nearly 15% of GDP, is suffering from the coronavirus, with a hotel association saying on Thursday the hotel sector could lose 30% to 50% of its revenues between March and June. Just over half of the 3 billion euros in credit lines announced by Centeno is aimed at companies working in tourism, hotels and restaurants. The other half goes to industries like textiles, clothing and wood. Around a third is set aside for micro and small enterprises.

"We know from recent memory what it means to become poor during a crisis," Ana Catarina Mendes, a senior Socialist lawmaker, said before parliament approved the state of emergency. "We must avoid that a crisis of public health becomes a social, economic, and political catastrophe." Concerned about supplies running out, the government ordered striking dockers at Lisbon's port back to work on Tuesday as people rushed to stock up on supplies at supermarkets and pharmacies in anticipation of a state of emergency announcement.

"Our priority is to save lives but to save lives it is essential that life continues," Costa told a news conference. "Essential goods must continue to be ensured (during the state of emergency)." (Additional reporting by Sergio Goncalves Editing by Ingrid Melander and Mark Heinrich)

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