Central Europe has been through an eventful and not very uplifting week. Whereas the immediate risks related to COVID-19 are better understood, long-term economic risks and hidden threats also warrant attention.
To keep up the appearance of normalcy in the Visegrad Group countries has become an increasingly difficult task, as elsewhere in Europe. The picture of Slovak President Zuzana Čaputová and the newly appointed government led by Igor Matovič was perhaps most striking in its conveyance of the current state of affairs in the fight against the coronavirus.
With a plethora of restrictions in place, measures which keep the majority of Central European citizens at home, also images of deserted streets and squares have become commonplace.
With the depths of the COVID-19 crisis yet fully within our grasp, both the impact and the duration of far-reaching interventions in our daily life remain hard to predict.
Swath of measures
The V4 countries all resorted to strong measures once it became evident that other European countries were incapable of containing the virus within one region or even the entire country. Czechia moved early on towards a system of home quarantine for Czech citizens returning from Italy. On 10 March, the Czech National Security Council communicated a decision that all schools and universities would be closed with a ban on large public events.
Two days later, Slovakia reinstated border controls with Austria, Hungary and Czechia. On 13 March, the government of outgoing Prime Minister Peter Pellegrini announced the closure of all airports. Meanwhile, Poland decided to close all schools and cultural institutions. Soon after, the country declared a state of “epidemic emergency” and closed its borders to non-citizens (and forced quarantine for Polish citizens) from Sunday 15 March onwards. Hungary had already taken a number of measures, but Prime Minister Viktor Orbán indicated the closure of the entire border and a full ban on events as of Monday 16 March.
With some variation between each of the V4 countries, at present, there are various restrictions on public life, ranging from a full closure of cafés and restaurants, reduced access to retail services and the general encouragement of teleworking and home-schooling.
Borders are mostly closed in the case of persons, with some exceptions for returning nationals, or subject to additional controls regarding the transport of goods.
The latest numbers (as of 18-19 March) show a growing number of tested and confirmed coronavirus patients, with the first deaths as well as recoveries reported in the last week. For now, it is difficult to tell whether the most recent restrictions will aid to ‘flatten the curve’, because of fluctuations in the daily numbers of confirmed cases.
Scheduling the unforeseeable
While the present situation remains dynamic, it is unlikely to lead to a rapid reversal nor a foreseeable lifting of the state of emergency in these countries. Universities and many businesses have switched to online conferences to make up for cancelled events. There have been some instances of hoarding products such as toilet paper, soap and pasta, but overall shops remain open with fully-stocked shelves – although with some people also opting for online shopping.
Scheduling for the next months has become a tricky endeavour, yet the Polish government is eager to keep the country’s presidential election in place for 10 May with a possible second round on 24 May. Prime Minister Mateusz Morawiecki dispelled that unforeseen circumstances should lead to an immediate postponement, even though bringing voters to the polls entails certain risks.
Last weekend, the first round of municipal elections took place in France – with a record-low turnout. Since then, the second round has been postponed after criticism on the government’s decision not to annul the exercise in democracy.
On the verge of a breakdown
The coronavirus presents an immediate risk to the region in terms of health but will see more detrimental effects in the capacity of health sectors to deal with new cases, in addition to other medical emergencies. Countries with reliable health care systems have been pushed to the brink, while reports about similar challenges to systems in the region. Doctors in Poland speak about systemic overburdening and the lack of specialised staff. In Hungary, public authorities started to ask for volunteers with a health degree to join on the frontline.
China has started deliveries of equipment and tests to some of the V4 countries, in a sign that the country has overcome the worst of the pandemic crisis and wants to blemish its reputation in the region. Poland is set to receive test kits, masks and goggles whereas the Czech army has already flown in coronavirus testers. Such an apparent display of solidarity is primarily seen as renewed attempts at ‘soft power’ by international commentators.
Beyond capacity problems of healthcare systems, the damage COVID-19 to both the regional, European and even world economy is likely going to be long-lasting. Economic historian Adam Tooze speaks about a crisis likely worse than the 2008 financial crisis. Meanwhile, the first economic indicators paint a gloomy picture.
In the Vienna Institute’s economic forecast, Central and Eastern Europe should expect a scenario of reduced growth (1.1%) and a technical recession for most or all countries of the region – if the virus is contained by mid-2020. While the V4 would fare slightly better than those outside of the EU, there is likely to be a long negative economic fallout.
Much will depend on the scale of the policy response, as governments in Poland and Hungary have already announced fiscal support and both the ECB and national central banks are preparing or have launched stimulus packages this week.
Time will also have to tell whether various emergency measures taken by governments will prove to be effective or rather will serve other aims, particularly when such measures are accompanied by the centralisation of authority in the hands of the executive power.
Many of the latest measures may help to stabilise markets and offset bankruptcy, job losses and a general economic downturn in the upcoming months. However, as recent weeks have shown, clear communication about current and future measures to citizens is key to avoid the spread of false information and unnecessary panic.
As reported on Visegrad Insight yesterday, many rumours and false stories surrounding the coronavirus have already appeared on the Internet. Either these were shared without much knowledge and consideration, or the result of a deliberate disinformation campaign.
In other words, the COVID-19 crisis does not only shed light on the state of our health care systems and the economy but also brings questions related to information sovereignty to the surface.
An effective response to the current pandemic should not only consist of economic measures but also an effective communication strategy and continued attempts to dispel irrational fear and disinformation.