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Author:  Ana Potočnik

In Croatia spending down by 30%

Total number of retail purchases issued in April in Croatia fell by 46% year-on-year, with the total value down by 30%, the national tax authority announced last month. The sharp drop in consumer spending comes amid the coronavirus crisis and lockdowns imposed to contain the spread of the virus.

Data released by the tax administration – which runs a central registry of all retail receipts issued to customers in Croatia’s stores – showed that between 20 and 26 April Croatians made 21.3 million purchases, 46% less than during the same period in 2019. The combined value of these purchases was EUR 291m, 30% down compared to last year.

Apart from the nationwide stay-at-home order and the closure of all non-essential businesses on March 19, the sharp decline is also attributed to the drop in demand in the tourism industry. Tourism and hospitality services are considered to account for more than 20% of Croatia’s GDP, which is expected to significantly shrink in 2020. World Bank predict a 6.2% contraction, while the International Monetary Fund put the figure at 9% – a drop larger than in any other emerging economy of Europe. 

Croatia's government forecast the GDP to shrink by 9.4% in 2020, before a projected 6.1% recovery in 2021.

Consumer prices are expected to drop mildly in 2020 by 0.3% year-on-year.

Speaking at a regular cabinet session last month, Prime Minister Andrej Plenković said the impact of the coronavirus crisis on both the local and global economies would be “short-term in nature.” The general government deficit is projected at 6.8% of GDP, or EUR 3.3 billion in 2020. In 2021, it is expected to drop to 2.4% of GDP. 

 

Plenković said that the government is hoping that a series of measures adopted to help businesses retain jobs – including a minimum wage state subsidies for furloughed workers (EUR 530) – would help reduce the expected increase in unemployment rate. The number of employed people, which stood at around 1.5 million before the coronavirus crisis, is expected to drop just 3.3% in 2020, and the average surveyed unemployment rate is projected at 9.5% in 2020 and 9% in 2021.

Meanwhile, the public-debt-to-GDP ratio in 2020 is expected to jump to 86.7% of GDP, a 13.5% increase from 2019. In 2021, the public-debt-to-GDP ratio is projected to fall to 83.2% of GDP.

Slovenian government allows reopening of libraries, galleries and museums

Libraries, art galleries and museums in Slovenia reopened their doors to visitors at the end of April due to the improved epidemiological situation in the country. Restaurants and pubs with open spaces, terraces and courtyards, were allowed to reopen at the beginning of May. Real estate agencies and chimney sweep service providers have also been allowed to resume their work.
The restriction under which persons over the age of 65 could only go shopping between 8 a.m. and 10 a.m. has also been lifted. Clothing and footwear repair shops, as well as key making workshops, have also reopened, alongside beauty salons, photographers, photocopier services, tailors, watchmakers and jewelers, furriers and leather goods manufacturers.

 

Life in Dubrovnik during pandemic

The Dubrovnik Museums institution has started a project called #dubrovnikquarantine2020 to document the lives of Dubrovnik residents and surrounding areas to reflect the isolation and quarantine caused by the coronavirus pandemic.

The ultimate goal of the project is for future generations to understand the world better and for scientists and experts to interpret it correctly, with the help of everything that residents will send, including photographs, videos, audios, drawings, art and other creations, jokes, scans of passes, notes or diary records made during the quarantine period.

Dubrovnik museums will frequently post materials on their social networks and websites, and a virtual exhibition, #dubrovnikquarantine2020, is also planned.

The ultimate goal of the project is for future generations to understand the world better and for scientists and experts to interpret it correctly, with the help of everything that residents will send, including photographs, videos, audios, drawings, art and other creations, jokes, scans of passes, notes or diary records made during the quarantine period.

In addition to documentation, the project entails collecting materials which refer to life in quarantine, such as gloves, respirators, disinfectants, protective clothes, original passes, medical prescriptions, cooking recipes, face shields, books, music or films.

Prince Charles makes donation to fund for post-quake reconstruction of Zagreb

Prince Charles, the heir apparent to the British throne, has made a donation to the Croatian government fund for the reconstruction of Zagreb after the earthquake on 22 March. “Because my wife and I have such fond and special memories of visiting Croatia four years ago, I was immensely shocked to hear that so many valuable historic buildings in Zagreb had suffered so much damage”, the Prince of Wales said in a letter to President Zoran Milanović.

“Croatia and its people are in our thoughts and prayers in these painful and difficult moments.”
Prince Charles and his wife Camilla, Duchess of Cornwall, visited Croatia in the spring of 2016. The visit did not have a political dimension but was focused on strengthening the ties between the two countries and their people.

"Since the earthquake struck the Croatian capital amid the COVID-19 pandemic, I can only imagine the challenging situation that the earthquake has caused for your country."

– Prince Charles

World Bank approves funds for Bosnia to combat coronavirus

The World Bank approved USD 36.2m in funding for Bosnia and Herzegovina, to help the country prevent, detect, and fight the novel coronavirus pandemic. The funds will be used to pay for medical equipment needed to strengthen Bosnia’s public health services, and for social assistance for nearly 50,000 people threatened by the economic fallout of the crisis.

“The World Bank stands with the people of Bosnia and Herzegovina (BiH) during this unprecedented crisis. While the situation is still unfolding, we have managed so far to prepare this initial package to help the country prevent, detect, and respond to the pandemic, and provide social assistance to most vulnerable groups”

– Emanuel Salinas, The World Bank’s country manager for Bosnia and Montenegro 

“With the BiH Emergency Covid-19 Project, the relevant authorities in the country will be able to increase isolation capacities in hospitals, obtain new intensive care beds with ventilators, establish new designated laboratories for testing and procure other medical equipment and material. Furthermore, some 48,000 people that are most affected by the pandemic crisis will receive social assistance benefits,”

–  World Bank Statement

EBRD to allocate funds to Western Balkans

The European Bank for Reconstruction and Development (EBRD) will assign between EUR 1.3bn and EUR 1.5bn to Western Balkans, including some EUR 700m–750m to Serbia, EBRD’s Director for Western Balkans, Zsuzsanna Hargitai, said in a comment to N1. Some 40% of those funds will be to support the companies in dealing with the situation caused by the corona pandemic. Local companies can count on EUR 400m, while small, middle-size and big companies can apply for loans. Credit conditions will depend on the economic sectors and risks. Loans for current assets will be for two to three-year period, while for investments, the repayment period will be seven years. State-owned companies in Serbia can count on EUR 150m.

EBRD will assign between EUR 1.3bn and EUR 1.5bn to Western Balkans including some EUR 700m–750m to Serbia.

Adriatic Journal

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