A second wave of the coronavirus contagion and the possible return of restrictive measures, from the closure of shops and factories to quarantine and curfew, would certainly have far worse consequences for the Serbian economy than at present.
When asked whether the national economy would survive a new wave of the coronavirus contagion, experts say “yes, but it would be much more difficult, with drastically worse consequences, mainly redundancies and reduced wages”.
Small and medium-sized enterprises would be at the biggest risk, since they have exhausted their stocks and used up state support measures. If the whole chain were to break down again, they would completely lose their market. This would mean stopping production, income, wages and, finally, the need to have workers.
Although the forecasts for the recovery of the Serbian economy are relatively optimistic, as the international financial institutions predict higher economic growth, i.e. a smaller GDP decline in Serbia compared to other countries, the new market ‘closure’ would influence the further development of the economic situation. What is certain is that the new wave of the coronavirus infection would probably have much worse consequences than the first, both in an economic sense and in the general health of the nation.
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“People have just realized that the worst was over and they are now relaxed, maybe too much, so a new closure would certainly be bad. From an economic point of view I think that the small and medium-sized enterprises would suffer the most. They have managed, thanks to small reserves and the economic measures of the state, to overcome and somehow survive the first blow of the crisis. However, stocks are now more or less exhausted and some companies are already on the verge of existence. On the other hand, I think that the state cannot do anything else, and has given everything it can to help the economy and does not have the resources to further support those who will get into trouble,” explains Ljubodrag Savić, professor at the Faculty of Economics in Belgrade, in an interview for Blic Biznis.
He also says that, as expected, there was a drop in industrial production in April, not only in Serbia but globally, and that the recovery in May will depend on the structure of the economy of some countries. According to him, after a month and a half, the world realized that the price of closure was too high and that the disease was not as dangerous as the first images from China showed.
“Serbia has returned to the level of industrial production in December 2000, so we have gone back 20 years since the beginning of the pandemic. Germany, as the core of the EU’s economy, remains the biggest problem because it cannot isolate itself from the terrible blow that America is suffering. America’s influence on the whole world in this situation will be much stronger than the effects of any measure,” said Professor Zdravkovic, adding that there is a significant difference between the United States and Europe when it comes to the current crisis.
As he explained, Europe has remained more or less stable socially, thanks to social protection mechanisms and unemployment benefits.
This post is also available in: Italiano