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EBRD, pandemics shocks Balkan economies but recovery in 2021
Projections subjected to 'unprecedented uncertainty' study says
13 May, 19:01
(ANSA) - BELGRADE, 13 MAG - Economies in the Western Balkans,
in Slovenia and Croatia will severely contract in 2020, as a
direct consequence of the pandemics and lockdowns, but they will
rebound in 2021, the European Bank for Reconstruction and
Development (EBRD) said in its latest Regional Economic
Prospects report, published today.
According to EBRD, the countries in the Western Balkans will contract on average by 4.8 per cent this year, with a rebound of 7.1 per cent forecasted for 2021. The strongest drop in 2020 is expected in Albania (-9.0%), followed by Montenegro (-8.0%), Kosovo (-5.0%), Bosnia and Herzegovina (-4.5%) and North Macedonia and Serbia (both -3.5%), while the GDP drop will reach -7.0% in Croatia and -5.5% in Slovenia.
Among the Balkan countries still not part of the European Union, Bosnia and Herzegovina, North Macedonia and Serbia are "expected to suffer from the disruption of global supply chains," the Bank said. "Albania and Montenegro would be affected by a reliance on tourism, while in Kosovo, and to some extent in other Western Balkans economies, lower remittances would reduce domestic demand," the EBRD noted. In relation to Croatia, "a key channel for disruption" will be tourism, which contributes to around 20% of GDP. Slovenia will be particularly hit also due to the fact that "around 10 per cent of GDP worth of exports go to the severely hit Italian economy." Next year, Albania could expect a growth of 12.0%, Montenegro 10.5%, Kosovo 7.5%, Bosnia and Herzegovina and Serbia both 6.0% and North Macedonia 5.5%, EBRD said. The EBRD warned that the projections are subject to "unprecedented uncertainty" due to the nature of the current emergency and crisis. "If social distancing remains in place for much longer than anticipated, the recession may be much deeper, with the 2019 levels of output per capita not attained again for years to come," the report noted. (ANSA).
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According to EBRD, the countries in the Western Balkans will contract on average by 4.8 per cent this year, with a rebound of 7.1 per cent forecasted for 2021. The strongest drop in 2020 is expected in Albania (-9.0%), followed by Montenegro (-8.0%), Kosovo (-5.0%), Bosnia and Herzegovina (-4.5%) and North Macedonia and Serbia (both -3.5%), while the GDP drop will reach -7.0% in Croatia and -5.5% in Slovenia.
Among the Balkan countries still not part of the European Union, Bosnia and Herzegovina, North Macedonia and Serbia are "expected to suffer from the disruption of global supply chains," the Bank said. "Albania and Montenegro would be affected by a reliance on tourism, while in Kosovo, and to some extent in other Western Balkans economies, lower remittances would reduce domestic demand," the EBRD noted. In relation to Croatia, "a key channel for disruption" will be tourism, which contributes to around 20% of GDP. Slovenia will be particularly hit also due to the fact that "around 10 per cent of GDP worth of exports go to the severely hit Italian economy." Next year, Albania could expect a growth of 12.0%, Montenegro 10.5%, Kosovo 7.5%, Bosnia and Herzegovina and Serbia both 6.0% and North Macedonia 5.5%, EBRD said. The EBRD warned that the projections are subject to "unprecedented uncertainty" due to the nature of the current emergency and crisis. "If social distancing remains in place for much longer than anticipated, the recession may be much deeper, with the 2019 levels of output per capita not attained again for years to come," the report noted. (ANSA).
