The second survey of how businesses feel the impact of Covid-19, conducted by the American Chamber of Commerce Serbia (AmCham), has found no layoffs are planned even though nearly two-thirds (60%) of all firms polled are facing difficulties. Recovery likely to be U-shaped for 55% of companies and W-shaped for 22%
More than one-half of those polled (55%) believe the economy will recover gradually, following a U-shaped curve, whilst concerns over a possible second wave of infections have led 22% to forecast a W-shaped recovery. Provided that Covid-19 is brought under control at once, more than two-thirds of all respondents believe it would not take more than six months to return to pre-outbreak performance.
Zoran Petrović, President of AmCham’s Board of Directors, thanked the Serbian Government for understanding the needs of businesses and being open to suggestions, adding that the survey was one of the best ways to help design and monitor business relief measures. Mr Petrović drew attention to firms’ increased optimism in spite of their falling profits: in AmCham’s first Covid-19 poll, conducted in March, 42% of all members reported expecting the pandemic to cause additional negative effects, whereas this latest survey puts the figure at 25%.
‘We would like to thank the Government for directly incorporating the suggestions of businesses and AmCham in these relief measures. The Government has given the economy a shot in the arm, but sectoral aid packages should also be considered until there is a return to pre-crisis levels, especially in the hardest-hit sectors such as hotels and transport. In the upcoming period, there must remain a strong focus on reducing all costs of doing business, especially administrative ones; if there is anything we have learnt from the past, it is surely that we are able to increase the extent of digitalisation of all government services and processes and so cut costs. This approach is the key to faster recovery and constitutes a sound foundation on which to grow and improve services and products in the private sector’, Mr Petrović said.
Second round of measures needed for hardest-hit sectors such as hospitality industry, transport, and real estate
AmCham notes that a second round of measures is needed that would be tailored to the needs of the hardest-hit sectors, in particular tourism (especially the hotel industry) and transport; the government should also consider introducing policies to help the construction industry and real estate sector. The most severely affected industries, such as hotels, have seen their profits decline by over 90% relative to last year; recovery to pre-crisis levels is not expected before 2023.
Methodology of the 2020 Covid-19 business impact survey