Economy will take a year to recover from the pandemic

It will take, on average, one year for the recovery of the economy affected by the COVID-19 pandemic, according to the results of the third leg of research “Zajedno kroz krizu” (Together against the crisis), conducted by the Chamber of Commerce and Industry of Serbia together with a USAID project.

Apparently, the crisis has hit micro-enterprises the hardest, while the lack of liquidity remains one of the key problems that enterprises will face, although digital solutions are an essential part of the recovery strategy.

In a survey conducted from 8 to 15 June, the recovery time estimated by most respondents is one year. One in three companies believes that three to six months will be enough, while the sectors most affected, such as tourism, transport and the creative industry, expect a recovery of over a year.

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Serbian business community is afraid of a new crisis. As many as 73% of companies are afraid of the second wave of pandemic and a new closure, as well as the drop in demand for products and services.

About 40% of companies have restrictions related to the decline in corporate liquidity, the decline in available sources of financing and changes in export and import policies. More than 90% of companies expect revenues to fall this year, with the largest losses to be recorded in tourism, creative industries and transport, followed by manufacturing and IT.

A quarter of respondents estimate that revenues in June 2020, compared to the same month last year, were at least halved and one in two companies reported a loss of up to 30%. One-fifth of micro-enterprises surveyed estimated that revenues in June this year were at least 70% lower than last year, while one-third of companies of the same size earned 30 to 50% less in June.

Nearly 60% of companies have facilitated remote work (work from home) and one in two companies reduced the number of working hours. About 20% of employers increased the number of employees and less than 5% made layoffs during the crisis. One third of companies in IT, food and beverage production and agriculture increased the number of workers in the previous period.

The fight for liquidity is crucial and difficulties in meeting obligations are expected, in particular for micro and small enterprises. One in two companies expects problems with tax payments in the next 30-90 days.

The research has been conducted in three stages since the beginning of the state of emergency. In the last, third cycle, 396 Serbian companies participated.

(N1, 06.07.2020)

This post is also available in: Italiano

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