Mexico begins shutting down as flu fears spread

By Catherine Bremer

MEXICO CITY (Reuters) - Mexico began shutting down parts of its economy on Thursday to slow the spread of a new flu strain as officials urged increased worldwide precautions against an imminent pandemic.

The World Health Organization said it would remain for now at its current alert level -- one step below full pandemic -- and that it would no longer refer to the H1N1 virus as "swine flu" to appease beleaguered meat producers.

New confirmed flu cases were reported in the United States, Canada and Europe, although a case in Peru, which would have been the first confirmed case in Latin America outside of Mexico, was later discounted.

Almost all cases outside of Mexico have been mild, only a handful of patients have required hospital treatment, and most global markets have shrugged off concerns.

But the case count continues to rise, and officials say there are many unanswered questions about the outbreak.

U.S. officials said new infections were occurring and at least 298 U.S. schools closed around the country because of possible infections. Canada recorded its first case of person-to person transmission of the virus.

In Mexico, the worst hit country with up to 176 deaths, President Felipe Calderon told government offices and private businesses not crucial to the economy to stop work beginning on Friday to avoid further spreading a virus that is striking across age and class lines.

"There is no safer place than your own home to avoid being infected with the flu virus," Calderon said in his first televised address since the outbreak started.

In Mexico City, where the virus has already brought public life to a standstill, some were skeptical while others vowed not to take part in the shutdown.

"Closing businesses is not right and not fair. What are we going to live on? Air?" said Andres Garcia, who works in a tailor shop in the old colonial center of the capital.

CURE WORSE THAN DISEASE?

Mexico's assembly for export factories known as maquiladoras, a pillar of the economy, said it would defy the shutdown call while some of the country's mines also vowed to stay in operation.

"We have commitments that we have to meet, and if we don't meet them, the cure will end up being worse than the disease," council head Cesar Castro told reporters.

With its tourism industry savaged, shoppers staying home and exports to the United States in steep decline, Mexico could find itself in the longest, deepest recession it has seen in years, according to analysts.

Mexico's peso was hammered by flu fears on Thursday and its stock market slid. But most global markets were taking the flu news in stride as traders focused on hopes that a deep U.S. recession may be nearing its end.