Bulgaria: SeeNews survey provides new insight into the impact of the COVID-19 crisis

Bulgaria: SeeNews survey provides new insight into the impact of the COVID-19 crisis

How is the crisis caused by the spread of the coronavirus affecting the economies and health systems of the countries of Southeastern Europe? The SeeNews regional business platform is trying to monitor the prospects for their future reconstruction.

All the countries in the region adopted restrictive measures at the onset of the pandemic, not simply parallelly with the countries of Western Europe, but also with the world in general. However, it is still unknown whether this had a completely negative effect on the economies of the 11 countries, as the data on the reduction of GDP in the second quarter of the year are not yet ready. Conclusions are also being drawn on how the crisis has affected tourism – a particularly important sector for the countries of Southeastern Europe.

“The decline in industrial production is smaller than expected”, said Lilya Goranova of the SeeNews platform in an interview with Bulgarian Radio’s Horizon program. “But if we’re talking about returning GDP to pre-pandemic levels, seven countries in the region are expected to do so in 2021 and Romania, Croatia, Slovenia and Montenegro will fall short. Among the 7 countries there are two for which the prospects are not certain; one is Bulgaria and the other is Bosnia and Herzegovina. The explanation for our country is that, even if it does not depend to such a great extent on tourism, the tourism industry, together with transport and trade, accounts for much of the gross added value. Our dependence on exports is another factor with a negative impact and, in the event that a new closure of the economies is imposed, this will have a very serious impact on our country”.

In terms of the stimulus package as a percentage of GDP, Bulgaria ranks third in the region with 10.7% in 2019. However, half of this percentage is provided for the stabilization of banks’ liquidity and is not expected to directly affect the economy. According to Lilya Goranova, the great enigma of the current crisis is the answer to the questions of how the recently approved European aid will be implemented and how it will affect the economies of the region.

“Our research is based on forecasts by the IMF, the World Bank, the EU, which take into account good and bad scenarios”, she continues. – “The worst-case scenario, for example, would be to re-instate the complete closure of the economies. As for whether we will postpone their recovery to 2022, I do not believe it – at least not in most countries in the region”.

How the level of new Covid-19 cases adds pressure on health systems constitutes another indicator in monitoring the platform. Bulgaria is proving to be one of the two countries most likely to be effective in securing hospital admissions, while it ranks fourth in Southeastern Europe in terms of medical staff.

“A few days ago, the Minister of Health stated that in our country the vaccine will not be mandatory” – Lilya Goranova recalled.

“This is probably a political decision in a state of insecurity, taking into account the doubts over the fact that the vaccine has not been adequately tested. According to health experts, people in a state can acquire collective immunity only if at least 70% are vaccinated. In Bulgaria, however, a large number of people do not seem to believe in the existence of this virus. As for the vaccine, we will monitor not only in our country, but also in other countries what the state decisions and political debates on the issue will be”.

Some of the data on the subject is expected to be announced in November. /ibna