The European Business Association (EBA) has stated that it understands the unprecedented situation with COVID-19, which is now prevailing around the world, as well as the importance of measures to curb the spread of the virus and maintain the health of citizens.
At the beginning of this week, the Association conducted a quick survey of entrepreneurs to find out about the impact of the quarantine on their businesses and their response in case of the quarantine prolongation.
Thus, almost half of the companies (48%) have already incurred between 20% and 50% of revenue losses. Another 16% decided to change staff salaries, and 14% decided to cut staff.
Based on the survey results, the businesses’ respond to the Cabinet’s decision to extend the quarantine for another 30 days will be as follows: 23% plan to reduce personnel wages, 17% plan to reduce the number of employees, 6% plan partially close their business.
At the same time, 23% do not plan any reduction or downsizing, 31% will search for new niches to develop their bisiness.
According to EBA Executive Director Anna Derevyanko, a halt in economic activity is already affecting both individual businesses and the economy in general, which in the future may impact the well-being of the population.
“And, if tough restrictive measures continue for another month, then the pessimistic forecasts may turn out to be a very optimistic. After all, the power reserve of companies is starting to run out, while small businesses are already exhausted. Therefore, along with saving lives, it is worth thinking about saving the economy, ” the Executive Director said.
To preliminary estimates, the basic forecast of the effects of quarantine is a reduction in the country’s GDP by 4%, and to a less optimistic scenario the decline could reach 9%.
The EBA emphasized that balanced and constructive steps should be taken today, because it will be too late in a month. In an idle economy, employment issues, the implementation of necessary payments and benefits, and even medical care may be in jeopardy. In addition, hundreds of thousands of people risk to lose their jobs.
The business community is urging authorities to act carefully and make decisions based on long-term economic consequences. After all, the cost of halting the economy can have devastating consequences for the entire population in a few months, according to experts, even worse than the pandemic itself, and it will take years to restore it.
“Therefore, we really want to believe that the authorities understand this risks when deciding on a 30-day quarantine and an emergency situation throughout the country,” the Association message reads.
As The Journalist reported, Ukraine introduces emergency situation regime, extends quarantine for 30 days.
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