When it comes to coronavirus containment, Luxembourg has a problem particular to landlocked tax havens. Ordinarily, a staggering 203,500 people (or 46 per cent of the country’s workforce) commute in from neighbouring Belgium, France and Germany every weekday for higher-paid jobs and lower taxes. They are crucial to the functioning of the affluent Luxembourgish economy: its financial institutions, insurance companies and healthcare sector.

So when it was announced that EU borders would be closed to non-essential travel on 17 March because of the coronavirus, Luxembourg officials rushed to introduce a certificate that would allow its cross-border workers to pass freely into the country. Since then, like many countries, it has tried to maintain a tenuous balance between safeguarding its economy and containing the disease.

But in this past week, Luxembourg has seen a rampant increase in cases of Covid-19. At its daily coronacrisis press conference yesterday, the prime minister Xavier Bettel confirmed that the number of cases in the country had ballooned to 798. Today, the Ministry of Health announced that there are 875 confirmed cases (roughly 1 in 700). Luxembourg’s population is around 614,000, so it has more cases per capita than Italy and one of the highest rates in the world.

This is perhaps more striking given that Luxembourg only had its first confirmed case on the 29 February, a 40-year-old man returning from Northern Italy via Charleroi Airport in Belgium. Since then, its spread has been faster than Hubei Province in China (which includes Wuhan) – taking only 21 days to reach 1 case of Covid-19 per 1000 people. Of course, different testing practices could interfere with this result.

Luxembourg is proud of its multiculturalism, although it may have contributed to jump-starting the initial spread. Luxembourg’s first, second and fourth confirmed cases all originated from Italy, whose nationals make up 3 per cent of the country’s population. In fact, foreign nationals represent a combined 47.5 per cent of the country’s total population, almost outnumbering native Luxembourgers.

The sheer number of cross-border workers that commute into the country could also accelerate the spread of the virus, if it hasn’t already. For one, the regions that surround and border Luxembourg are all struggling themselves. The Grand-Est region that borders Luxembourg, for example, is one of the worst affected regions in France (3395 cases yesterday) and the source of Luxembourg’s first (confirmed) contaminated cross-border worker on the 10 March, an employee at a fertility clinic in Luxembourg City. Usually, over 107,000 people commute into Luxembourg from the Grand-Est region.

The Luxembourgish government has encouraged working from home (or ‘télétravail’) despite an initial tax-related hurdle. An accord negotiated with France in 2018 only allowed 29 days of at-home work to cross-border workers. Anything beyond that and they would have to pay higher French taxes. Last Thursday, though, both countries decided to delay this arrangement for the foreseeable future. Similar deals have been agreed with Belgium and Germany.

The necessity for cross-border travel is seen most in the country’s healthcare sector, though, with 62 per cent of Luxembourg’s hospital and healthcare staff commuting in from neighbouring countries. “Our entire health sector risks collapse without cross-border workers, so we must do everything so that they can come and work,” said the Health Minister Pauline Lenert a week ago, announcing that cross-border healthcare workers and their families can stay in a Luxembourgish hotel free of charge.

In a press conference yesterday, though, Lenert insisted that the country was well prepared. The smaller size of the country enables it to centralise and simplify procedure which includes the daily testing of 1500 people in three mobile testing zones dotted strategically around the country. Lenert claimed that this number was one of the highest per capita in Europe and explains the comparatively high number of cases in the country.

Luxembourg already has one of the highest numbers of critical care beds per capita in Europe, but is opening further temporary medical facilities at LuxExpo (exposition hall), Mondorf Thermal Baths, Rockhal (concert venue) and Colpach Castle. Lenert said they were “expecting a rise in infections”, adding, “Europe is currently the epicentre of the crisis, and Luxembourg is in the centre of Europe.”

The country where the Schengen accord was signed 45 years ago is struggling to contain the virus, and its dependence on the freedom of movement of capital and people that has sparked its economic rise could further exacerbate the spread.

James Walker is a freelance journalist who has written for Prospect magazine and OpenDemocracy.