Good morning. David Meyer here in Berlin, filling in for Alan.
Several months ago, we were writing about how European authorities were trying a mix of incentives and mandates to convince vaccine holdouts to change their mind. It seems the carrots had a limited effect and, with infection rates now soaring in certain countries, the plan is now all about sticks.
Austria made its big move on Friday, when the government announced the world’s first broad vaccine mandate outside Indonesia, Turkmenistan and Micronesia. It also announced a nationwide lockdown that took effect this morning, and that may last less than three weeks—when it’s lifted, restrictions will likely still apply to unvaccinated people, however, as they have already done for the last week.
The lockdown is what rattled markets Friday, particularly as Germany is already following Austria in targeting restrictions at the unvaccinated, so the fear is that it might also proceed to full lockdown at some point (“Germany is probably the swing factor here for sentiment in Europe so case numbers will be watched closely,” wrote Deutsche Bank’s Jim Reid in a Monday note). However, the vaccination mandate is what sparked massive protests in Vienna on Saturday, featuring a mix of anti-vaxxers and far-right types.
The Netherlands returned to partial lockdown just over a week ago. In Rotterdam on Friday, protestors who were incensed at plans for an official COVID vaccine pass, clashed violently with police, who fired warning shots to break up the crowds. The unrest spread across the country over the weekend. Belgium also introduced a partial lockdown last week, requiring people to work from home most of the time. Yesterday, an estimated 35,000 demonstrated, again with violent clashes breaking out and the police deploying water cannons and tear gas.
The sticks are certainly provoking a negative response in some quarters, but will they also work? When France introduced compulsory vaccination for health care staff back in July, the move swiftly saw people flocking to set up vaccination appointments. In the last few weeks, there has been a noticeable increase in the rate of Austrians getting their first doses.
It will be interesting to see whether that feat is replicated in Germany, now that unvaccinated people are being barred from much of public life in states such as Bavaria and Saxony. As Health Minister Jens Spahn put it this morning, in an extremely German refusal to sugar-coat matters: “Probably by the end of this winter…pretty much everyone in Germany will be vaccinated, cured or dead.”
But it will also be interesting to see whether civil resistance progresses over the coming months, particularly as Europe moves firmly into the booster era. The Greek government is calling for booster status to be added to the EU’s COVID-19 digital vaccine certificates—which enable free movement across the union—and France has already said it will next month start tying gym, restaurant and plane access to having had a third jab.
Right now, the split is between the vaccinated and unvaccinated. Soon, those who aren’t vaccinated enough may also find themselves at a particular disadvantage. This really could turn out to be a restless winter. More news below.
Activision Blizzard CEO Bobby Kotick, under fire for his handling of sexual misconduct allegations—and himself the target of misconduct allegations—reportedly told senior managers at the gaming firm that he'll consider quitting, if he can't quickly fix Activision's culture problems. Wall Street Journal
After Chinese authorities hit five directors of a pharmaceutical company with massive fines, independent directors are fleeing the boards of listed companies in the country. The Kangmei directors had to jointly compensate investors a total of $391 million, after being found responsible (along with external accountants) for fabricating financial statements. Fortune
The private equity firm KKR has made a $37 billion bid for Telecom Italia. Representing a 45% premium on Telecom Italia's Friday closing price, it would be one of Europe's largest-ever private equity buyouts. The board sees the offer as friendly. The Italian government has veto power. Financial Times
AROUND THE WATER COOLER
JPMorgan is giving its Hong Kong staff up to $5,000 to cover their quarantine costs when they arrive in the "zero COVID" city. People arriving in Hong Kong need to spend up to three weeks in hotel quarantine, at their own expense, unless they're JPMorgan CEO Jamie Dimon, who was granted an exemption for his short trip earlier this month. Fortune
The prosecution in the trial of Elizabeth Holmes wrapped up its case by calling former Fortune reporter Roger Parloff—author of a 2014 cover story that was a big boost to Theranos—to the stand. Parloff described how Holmes lied to him about the effectiveness of Theranos's blood-analysis technology. Then Holmes herself testified, in what observers see as a risky move. Fortune
El Salvador will build a tax-free "Bitcoin City" and issue the world's first sovereign Bitcoin bonds, crypto-mad President Nayib Bukele has announced. The bonds will in part pay for geothermal-powered Bitcoin mining. Fortune
A fascinating piece here about a kilometer-long stockpile of aluminum that could end the global shortage, but is instead sitting in an industrial park near Ho Chi Minh City. Worth $5 billion or so, it's been there since Vietnamese authorities seized it in 2019, in a U.S.-led anti-dumping probe. Bloomberg
This edition of CEO Daily was edited by David Meyer.
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