Letter from… Paris

By Ulysse Avrane, Junior Consultant, CLAI (Part of SEC Newgate)

Since my last letter, the drop in the number of new daily cases of coronavirus across France has continued while the number of tests conducted has increased. However, with approximately 200,000 tests per week, we are still far from the Government’s promise of 700,000 tests announced in April, at the peak of the contamination in France.   

The deconfinement did breathe new life into the social and economic activity of the country, and seemed to be going well enough in its early days, but lately a slow yet definite rise in the cases again is starting to worry the authorities. The situation in France still remains better than in most other countries in the world, with a second wave not quite here yet and less than 2000 new cases and 20 deaths reported daily. Yet, the condition in neighbouring Spain and other countries on a similar timeline of the pandemic as France does call for more vigilance here.  

Even though political authorities continue to reiterate that a second session of general confinement is not on the cards, in light of the uncertainty of current circumstances, expecting the unexpected might be the best attitude to have.

On that account, the tourism industry is already under the effect of cautionary measures. Paris, right in the middle of summer, is eerily missing its yearly tourists from Asia, the Middle East and the US. The usually bustling streets of the city are empty as even Parisians have left for their annual vacations. Not too far though of course. The uncertainty of overseas travel means that Parisians and the French in general have adapted their travel plans to Covid-19: staying in the country for their holidays, preferring driving over taking trains and putting aside the spirit of adventure for the next year!

In the hotel sector, activity is picking up slowly but the occupancy rate is only around 30% compared to 90% at the same time last year. Palaces and large hotels are suffering the most since they are extremely dependent on foreign customers. Most palaces have therefore decided not to reopen before the start of the school year. 

Parisian restaurants are also struggling, especially in tourism districts. Restaurants that have a regular and local customer base are doing better.

In other news, there was a cabinet reshuffle in France, which included the Prime Minister. French President Emmanuel Macron’s objective is to pass the last two years of his mandate more easily, before his attempt at re-election in 2022. However the appointment of the new ministers has not been well received by everyone.