GOVERNMENT EARLY POLICY RESPONSES ON COVID-19 CHALLENGES IN CENTRAL AND EASTERN EUROPE: SME SUPPORT

Abstract

The main aim of the given research is to analyse Government policy early response due to the Covid-19 crisis in Central and Eastern Europe regarding SME support. The research methodology is based on an analysis of the pandemic impact on key indicators of countries development as well as an analysis of SME support policies responses by selected countries (Bulgaria, Czech Republic, Hungary, Poland, Romania, Slovenia and Ukraine). The dynamic trends of Covid-19 spread and its impact on macroeconomic indicators were analysed. The negative growth of GDP, as well as current account balance and increasing gross debt burden, were explored in all analysed countries and the policy responses were the required measures to avoid possible economic collapse. Implemented measures were mainly directed to achieve economic recovery and capturing stability, but the main focus of the research is to analyse the support policies according to the criterion of enterprise size, SME in particular. The study is based on country-level data as well as on individual State Aid cases of each analysed CEE country. It allowed to evaluate policy response mechanisms in terms of measures regarding enterprise size. Although SMEs suffered the most during the crisis, CEE countries spent most of their resources on supporting companies, regardless of their size.