Impacts of COVID-19 Poverty under Covid-19 in North Macedonia: Analysis of distributional impact of the crisis and the government response

Abstract

The objective of the proposal is to nowcast the effects of the Covid-19 lock-down on the Macedonian economy, in terms of lost income, budgetary impact, and distributional consequences. As elsewhere worldwide, on March 11, 2020, the Macedonian government imposed a curfew, a lockdown of the high-contact sectors and reduced movement to the necessary minimum. The effects onto the economy were massive, as even March saw significant declines in industrial production, trade volume and tourist inflow, let alone April and May which exhibited dramatic deteriorations. It is projected that the economy will decline by 3.8% in 2020, while the drop in Q2-2020 will be of a magnitude not seen since Macedonian independence in 1991. The restrictions somehow eased since June 2020 and the economy now operates under stringent health protocols, but consumers still withhold their consumption, especially of non-essential goods. Travel is still considerably hard. In order to cushion the effects of the lockdown, the Government introduced income-support measures. This have been largely grouped into three categories: i) job-retention measures, mainly consisted of direct support of companies for each workplace, in the amount of the minimum wage; and subsidies of social contributions in the amount of 50% in the hardest-hit sectors; ii) social protection measures, mainly consisted of relaxation of the criteria for obtaining guaranteed minimum income; and temporary lax criteria for obtaining an unemployment benefit; and iii) one-off financial support to vulnerable citizens to support consumption of domestic products and domestic tourism.


Members

Project leader: Marjan Petreski

Project researchers:

Scientific mentors: John Cockburn


Journal publication

No journal publications.


Working Papers

Title Modified Size Comments Recommendations
Poverty during Covid-19 in North Macedonia: Analysis of the distributional impact of the crisis and government response 2021-01-06 585.72kB 0 0

Policy Briefs

No policy briefs.


Final report

No final reports.


Proposal

No proposals.


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