Western Balkans Regular Economic Report, No. 19, Spring 2021 : Subdued Recovery
In 2020 COVID-19 (coronavirus) plunged the Western Balkan countries, like the rest of the world, into deep recession. Economic activity contracted by an estimated 3.4 percent - the worst downturn on record. The primary causes were the drop in both...
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| Format: | Report |
| Language: | English |
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World Bank, Washington, DC
2021
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| Online Access: | http://documents.worldbank.org/curated/en/303461619449910634/Subdued-Recovery http://hdl.handle.net/10986/35509 |
| Summary: | In 2020 COVID-19 (coronavirus) plunged
the Western Balkan countries, like the rest of the world,
into deep recession. Economic activity contracted by an
estimated 3.4 percent - the worst downturn on record. The
primary causes were the drop in both domestic and foreign
demand and disruptions in supply chains, especially early in
the year when activity in a number of sectors simply shut
down. Countries like Montenegro that have a services or
tourism-oriented economy, and those where more stringent
containment measures and lockdowns were imposed fared the
worst. The economy began to reactivate in Q3 2020, supported
by a partial easing of stringent lockdowns and the revival
of global demand as vaccine development advanced. However,
in late 2020 restrictions were renewed in response to a
resurgence of infections across most of the region; they
have kept the recovery subdued. The crisis has led to
significant job losses and interruptions in welfare
improvements, but the labor market is rebounding from the
troughs of the recession. As noted in the Fall 2020 Regular
Economic Report (RER), the pandemic halted a decade of
progress in boosting incomes and reducing poverty: Since its
start 139,000 jobs have been lost and between 165,000 and
336,000 people in theregion were pushed into poverty.
However, job support schemes and other government measures
limited the labor market fallout and helped to prevent
steeper spikes in poverty. By yearend, the labor market had
recovered half its pandemic losses, but large numbers of
people are still unemployed, and many dropped out of the
labor force discouraged by the poor economic prospects.
Moreover, workers with less education, women, youth, those
in contact-intensive sectors, and those informally employed
have suffered disproportionate livelihood and income losses. |
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