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    Global Economic Prospects: Europe and Central Asia: June 2020

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    michel mboue
    The document summarizes the economic outlook for Europe and Central Asia amid the COVID-19 pandemic. It forecasts that the regional economy will contract by 4.7% in 2020, with recessions across almost all countries. Risks are heavily weighted to the downside, as a greater virus spread or prolonged recession could further weaken economies, especially those highly dependent on trade, finance or remittances from the Eurozone or Russia. Individual country forecasts range from a 6% contraction in Russia to 1.5% growth in Uzbekistan. The World Bank is providing up to $160 billion in financial support to over 100 countries to address the crisis.

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    Global Economic Prospects: Europe and Central Asia: June 2020

    Uploaded by

    michel mboue
    13 views2 pages
    The document summarizes the economic outlook for Europe and Central Asia amid the COVID-19 pandemic. It forecasts that the regional economy will contract by 4.7% in 2020, with recessions across almost all countries. Risks are heavily weighted to the downside, as a greater virus spread or prolonged recession could further weaken economies, especially those highly dependent on trade, finance or remittances from the Eurozone or Russia. Individual country forecasts range from a 6% contraction in Russia to 1.5% growth in Uzbekistan. The World Bank is providing up to $160 billion in financial support to over 100 countries to address the crisis.

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    World Bank

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    GlobalEconomicProspectsJune2020RegionalOverviewECA

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    The document summarizes the economic outlook for Europe and Central Asia amid the COVID-19 pandemic. It forecasts that the regional economy will contract by 4.7% in 2020, with recessions across almost all countries. Risks are heavily weighted to the downside, as a greater virus spread or prolonged recession could further weaken economies, especially those highly dependent on trade, finance or remittances from the Eurozone or Russia. Individual country forecasts range from a 6% contraction in Russia to 1.5% growth in Uzbekistan. The World Bank is providing up to $160 billion in financial support to over 100 countries to address the crisis.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    13 views2 pages

    Global Economic Prospects: Europe and Central Asia: June 2020

    Uploaded by

    michel mboue
    The document summarizes the economic outlook for Europe and Central Asia amid the COVID-19 pandemic. It forecasts that the regional economy will contract by 4.7% in 2020, with recessions across almost all countries. Risks are heavily weighted to the downside, as a greater virus spread or prolonged recession could further weaken economies, especially those highly dependent on trade, finance or remittances from the Eurozone or Russia. Individual country forecasts range from a 6% contraction in Russia to 1.5% growth in Uzbekistan. The World Bank is providing up to $160 billion in financial support to over 100 countries to address the crisis.

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    Global Economic Prospects: Europe and Central Asia

    June 2020

    Recent developments: The COVID-19 pandemic has adversely affected Europe and Central Asia through
    the collapse in global commodity prices, disruptions to global and regional supply chains, and heightened risk
    aversion in financial markets. The widening of domestic outbreaks of the virus has steepened the decline in
    domestic demand, exacerbated supply disruptions, and brought much activity to a halt.

    Economies in the region have experienced substantial flight-to-safety outflows and a rise in bond spreads.
    Weaker currencies have contributed to higher borrowing costs, and current account pressures have been
    exacerbated by a collapse in exports.

    Many of the region’s central banks have responded to the crisis by ramping up monetary support, and
    authorities have intervened in foreign exchange markets to stabilize their currencies and mitigate volatility,
    such as in Kazakhstan, or have used sovereign wealth funds to do so, such as in Azerbaijan and the Russian
    Federation.

    While fiscal policy options are limited in many countries, policymakers have used existing buffers or prioritized
    spending on health care, social safety nets, support for the private sector, and to counter financial market
    disruption. While a number of countries have announced fiscal support packages, many economies were ill
    prepared for the pandemic given limited health care capacity.

    Outlook: The regional economy is forecast to contract by 4.7%, with recessions in nearly all countries. The
    outlook assumes that government restrictions are gradually lifted by the start of the second half of the year. In
    a scenario in which the effects of the pandemic wane and trade and investment recover, Europe and Central
    Asia growth would be anticipated to revive to 3.6 percent in 2021.

    Economic activity in the region is vulnerable to global spillovers due to its openness to trade and financial flows,
    including remittances. In addition, for energy exporters in the region, which include Russia, Kazakhstan and
    Azerbaijan, continued low oil prices are expected to weigh on growth.

    Russia’s economy is forecast to contract by 6% this year, reflecting a jump in COVID-19 cases and the collapse
    in oil prices. Turkey’s economy is anticipated to shrink by 3.8% this year, subject to shutdowns and continued
    weakness in investment.

    Economic activity is expected to contract in every sub-region in 2020 as outbreaks of the virus constrain private
    consumption and investment: Central Europe by 5%; Western Balkans by 3.2%; South Caucasus by 3.1%;
    Eastern Europe by 3.6%; and Central Asia by 1.7%.

    The impact on economic activity is highly uncertain and could be more severe if the pandemic and the
    associated collapse in activity worsen. Hardest hit would be economies with strong trade and financial linkages,
    including remittances, to the Euro Area or Russia.

    Risks: The balance of risks leans heavily to the downside. A greater spread of infections across the region
    and associated restrictive measures would weigh even more harshly on consumption and investment. In
    addition, a sharp fall in remittances could amplify the regional economic downturn. A prolonged recession could
    negatively affect domestic financial sectors and heighten the risk of financial instability. A protracted
    deterioration in investment sentiment could lead to a substantial decline in foreign direct investment. Regional
    weather patterns, including the drought that is affecting economies in Eastern Europe and the Western
    Balkans, also pose a downside risk to the forecasts.
    Download Global Economic Prospects

    Europe and Central Asia Country Forecasts


    (Annual percent change unless indicated otherwise)
    2017 2018 2019e 2020f 2021f
    GDP at market prices (2010 US$)
    Albania 3.8 4.1 2.2 -5.0 8.8
    Armenia 7.5 5.2 7.6 -2.8 4.9
    Azerbaijan 0.2 1.5 2.2 -2.6 2.2
    Belarus 2.5 3.1 1.2 -4.0 1.0
    Bosnia and Herzegovina a 3.2 3.7 2.6 -3.2 3.4
    Bulgaria 3.5 3.1 3.4 -6.2 4.3
    Croatia 3.1 2.7 2.9 -9.3 5.4
    Georgia 4.8 4.8 5.1 -4.8 4.0
    Hungary 4.3 5.1 4.9 -5.0 4.5
    Kazakhstan 4.1 4.1 4.5 -3.0 2.5
    Kosovo 4.2 3.8 4.2 -4.5 5.2
    Kyrgyz Republic 4.7 3.8 4.5 -4.0 5.6
    Moldova 4.7 4.3 3.6 -3.1 4.0
    Montenegro 4.7 5.1 3.6 -5.6 4.8
    North Macedonia 1.1 2.7 3.6 -2.1 3.9
    Poland 4.9 5.3 4.1 -4.2 2.8
    Romania 7.1 4.4 4.1 -5.7 5.4
    Russia 1.8 2.5 1.3 -6.0 2.7
    Serbia 2.0 4.4 4.2 -2.5 4.0
    Tajikistan 7.6 7.3 7.5 -2.0 3.7
    Turkey 7.5 2.8 0.9 -3.8 5.0
    Turkmenistan 6.5 6.2 6.3 0.0 4.0
    Ukraine 2.5 3.3 3.2 -3.5 3.0
    Uzbekistan 4.5 5.4 5.6 1.5 6.6
    Source: World Bank.
    Notes: e = estimate; f = forecast. World Bank forecasts are frequently updated based on new
    information and changing (global) circumstances. Consequently, projections presented here may
    differ from those contained in other Bank documents, even if basic assessments of countries’
    prospects do not significantly differ at any given moment in time.
    a. GDP growth rate at constant prices is based on production approach.

    Download this data

    World Bank Group COVID-19 Response


    “The World Bank Group, one of the largest sources of funding and knowledge for developing countries, is
    taking broad, fast action to help developing countries strengthen their pandemic response. We are
    supporting public health interventions, working to ensure the flow of critical supplies and equipment, and
    helping the private sector continue to operate and sustain jobs. We will be deploying up to $160 billion in
    financial support over 15 months to help more than 100 countries protect the poor and vulnerable, support
    businesses, and bolster economic recovery. This includes $50 billion of new IDA resources through grants
    and highly concessional loans.”

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