Economic Recovery After COVID-19

The current COVID-19 pandemic has affected the global economy and the countries across the world at a scale that was impossible to anticipate when the first cases of infected people occurred. Economic globalization and people’s freedom of movement have caused the fast spread of the virus, which impacted all the European Union’s Member States in a more or less severe way. Pressure was soon exerted on the capacity of the national healthcare systems to cope with an alarmingly fast increase in the number of infections as well as on the authorities, which were called to decide on the best ways to counter the spread of the virus. The analysis conducted in this study reveals the general picture of all the specific branches of the medical field, both at national level and comparatively, versus other member states. Far from being an exhaustive analysis, the study comprises enough elements and parameters to outline a realistic and recent picture of the Romanian healthcare services in the context of the new challenges entailed by COVID-19. Thus, we introduce the main features of the medical sector from the perspective of several coordinates, which are then placed in the context of the current pandemic. Based on this canvas, we propose a set of feasible short, medium and long-term actions, meant to significantly improve not only the systemic responsiveness and readiness but also the efficient performance of economic and social activities in our country under the circumstances of a pandemic.

If we were to analyze agriculture at European level, agriculture contributed with 1.1% to the GDP of the European Union in 2018. EU agricultural production comes from millions of predominantly small farms. The agricultural sector contributed with 176.9 billion euro to the total EU GDP in 2018. In Romania, there is an upward trend in agricultural factor revenues per unit of annual employment, from 2007 increasing to 2018. In Romania, value of agri-food production increased strongly (+8.0%) in 2018 to a new level of 18.6 billion euro. More than two-thirds of this total value comes from crop products. Following this situation, it can be seen that in Romania, agriculture has a sector of the economy of national interest. Recently, in the last two years, the agricultural sector in Romania has been counteracted by two significant problems, the COVID-19 pandemic, but especially excessive security in the agricultural year 2019–2020. In this paper, we want to identify the current situation of the sector, its level, as well as the effect that at least these two phenomena have had on this field. For this, a quantitative analysis was performed on the number of employees, added from agriculture, level of investment, sectoral profitability, number of farms in the plant sector and in the livestock sector and trade balance. Following this analysis, a qualitative research was carried out in Romanian agriculture in order to identify the impact that some recent phenomena may have on the agricultural sector in Romania.

The education system represents one of the major pillars for society development. Its structure and functionality have direct impact on the evolution of all fields of activity, bringing direct and multiplied effects. From this perspective, the COVID-19 pandemic triggered a wide range of events that major influenced the characteristics of the educational process. The educational organizations fought to continue to provide a quality education under the new conditions at the same time with preventing the spread of coronavirus. This paper aims to reveal the challenges that higher education faced during the pandemic times, with a special focus on the students as part of the educational community. The paper is structured in four parts, introducing the pandemic context, emphasizing the specific elements of higher education under the impact of COVID-19, presenting the results of a particular research dedicated to the perception of students from Bucharest University of Economic Studies (BUES) regarding the implications generated by COVID-19 pandemic on the educational process and conclusion and recommendations. The methodology used was based on statistical survey addressed to the BUES students as relevant stakeholders of the university community. The sample was designed by using the “snowball sampling” method, and 369 respondents provided their opinions on the topics. The results obtained are valuable as the higher education institutions can design, based on the needs of various stakeholders and a strong communication process, innovative educational strategies that are adapted to this dynamic and unpredictable environment, but also contributing to a more modern and effective educational system able to fulfill its mission to the society.

Public administration is a key area for the economic and social development, with a direct impact on the governance system and on improving the quality of citizens’ lives. COVID-19 pandemic revealed public administration’s need to modernize and reform. The analysis of the Romanian public administration from the human resources perspective revealed that this area is facing with an ageing body of civil servants, with instability caused by the frequent changes in legislation, the need to train civil servants and difficulties in attracting and retaining personnel specialized in areas with deficit (IT, education and health). These problems had impact on public administrations’ efficiency and performance and on the successful implementation of reforms and strategies. Also, the analysis revealed that Romania ranks in the last places in the European rankings regarding all indicators related to digitalization which shows the need for speeding the digitalization process, inclusively in the public utility sector. More than that, the research aimed to investigate the implications of the COVID-19 crisis on the economy of Romania's regions showing that reducing the effects of the COVID-19 crisis and reviving the economy implies concerted measures in the short, medium and long terms that should focus on managing the crisis of the public health system and on the economic, social and public finance crisis.

Beginning with the final of 2019, the whole world has faced the challenges of a new disease. Each country has dealt with it in a proper way, but all of them adopted radical measures for the sectors major affected. One of the sectors that have been immobilized is tourism. Despite the Romanian tourism it is not a significant contributor to Gross Domestic Product, the lockdown had many strong effects. The present paper contains three main components: the analysis of the hotel, restaurant, and travel industry (the industry evolution between 2014–2019, the analysis of the correlation of the sector with the other sectors of the national economy—Leontief model); the impact of the COVID-19 pandemic on the industry (social and economic impacts) and the plan of proposed measures to reduce the effects of COVID-19 and to relaunch the field in the short and medium terms (measures proposals for large companies and for small and medium enterprises and households, etc.). The aim of this paper is to study the situation of hotel, restaurant, and travel industry in Romania and to find the solutions to restart the activity safely.

International trade was one of the most affected following the Covid-19 crisis and it is also envisaged to be shaped by important alterations. Romania, being part of global value chains, is prone to such mutations. Therefore, our aim is to draw a picture of actual evolutions and to identify risks and opportunities in international trade’s development. We notice that the containment measures have already had an uneven impact on international trade, generating the largest drop in both trade of goods and services in the last years. We deepen our investigation on the evolution of Romania’s international trade using monthly data in order to evidence the changes induced during the spread of the pandemic. We discover that the Covid-19 crisis had a larger impact on Romania’s international trade than the one felt during the economic crisis during 2008–2009. In addition, we use a VECM model and Granger analysis for examining the nature of the relationship between Romanian exports of goods and services and EU international trade for the period 2000–2019, based on quarterly data. Our aim is to examine if Romanian exports bring their contribution to the total EU imports as well as to the total EU exports, highlighting the long-run equilibrium relationship. We find that that a 1% increase in Romanian exports contributes to an increase in the EU exports and imports to about 0.55% over the next four quarters.

Postponing debt payment in the context of a lockdown of the economy in Romania during COVID-19 pandemic was a logical and beneficial step for all stakeholders. The analysis performed concludes that the solutions proposed both by GEO no. 37/2020 and the Law approving it are not likely to significantly affect the liquidity position of commercial banks in Romania, as they are able to absorb the shock. Also, the macroeconomic shock of COVID-19 may lead to a significant increase in the volume of non-performing loans, with subsequent negative effects on the banking sector's ability to lend to the real economy. In the context of the COVID-19 pandemic, the reduced-form stress testing exercise indicates a potential increase in the non-performing loans (NPL) rate in Romania, up to a level of approximately 12% in the adverse scenario, over a 2-year horizon. The simulations performed indicate that the banking sector can make a substantial contribution to limiting the economic contraction of 2020 and 2021 and thus to reducing business cycle volatility.

This article dwells on an extended research regarding the impact of the COVID-19 pandemic on the building industry and on real estate transactions in Romania. The main reasons for conducting the study were both the importance of this field for the Romanian economy and the unique opportunity to observe the effects of the pandemic on the building industry and real estate transactions. The research focused on the segments of activity where we could identify this impact fairly quickly and describe it from a quantitative perspective, which revealed a drop in demand for new constructions as well as in the number of real estate transactions during the lockdown. The human resources in the field of constructions and real estate transactions also were among those who suffered the most, if we are to judge from the share of cancelled individual labor contracts in the total number of labor contracts that were cancelled across the country during the pandemic. At the beginning of the pandemic, the labor force in the construction sector was among the most affected, with almost 18% of employment contracts concluded at national level.

The negative impact of COVID-19 crisis on international trade led to significant unwelcomed consequences for economies all over the world, given the actual scale of globalization and interconnection. While trade in services showed a certain resilience during the financial crisis in 2008, this time, the restriction measures for the containment of the virus and social isolation affected their consumption due to the specific characteristics of their nature: proximity of consumption, intangibility, heterogeneity, and perishability. This paper’s aim is to assess the impact of COVID-19 on Romania’s international trade in services. In this respect, we use monthly data in order to trace the evolution of both exports and imports during 2020 as compared to the previous year. In addition, we evaluate the behavior of the major groups of traded services in the same period, in order to identify changes in the distribution of services. Finally, we compare the evolution of trade in services during the financial and the actual crises. We find that imports of services saw a larger drop than exports. In addition, export of services was less affected than export in goods, while imports of services were more severely affected than the drop in the imports of goods. Travel and tourism was the most affected, while the rest of the most important other sectors show a certain recovery at the end of 2020. The drop in the exports of services in 2020 was double than the one registered during the crisis quarters in 2008–2009.

The economic and financial crisis generated by COVID-19 has determined a huge pressure on the state, to which is automatically assigned a dual role, with a major importance in relaunching the Romanian economy. The state authorities remains within the role of collecting the budgetary revenues of fiscal nature, necessary to ensure the smooth functioning of health, education, justice, etc. On the other hand, it is absolutely necessary the intervention of the state through measures that support the business environment and individuals in order to overcome the negative effects generated by the lack of liquidity. The intervention on the existing fiscal pressure requires rapid action, applicable as soon as possible, without exceptions and without excessive bureaucracy, with an involvement and collaboration between the state authorities and the business environment, respectively taxpayers, based on honesty, fairness and total transparency. The reduction of fiscal budget revenues (felt today) is indisputable. However, taking into consideration this context, measures as increasing taxation, maintaining the fiscal burden in order to obtain budgetary revenues to cover the existent budgetary expenditures represents only a clear path to the disaster of Romania’s economy. The only viable solution outlined is based on the resettlement of budget expenditures, simultaneously with the temporary waiver of part of the tax revenues in order to restart the activity of companies. The onset of the COVID-19 crisis means a total ‘restart’ of the business environment. On the other hand, it can also be an opportunity for the state authorities to intervene in the continuity of the activity of those companies that have shown ‘inappropriate tax behavior’ for long periods of time.

The chapter below represents the summary of a research approach carried out in order to provide decisive support for the public environment of the Romanian economy, which, like any other public decision maker in the world, has difficulty in substantiating public policies due to the COVID-19 pandemic unexpectedly in which the epidemic appeared and its rapid spread led us to consider that, on the one hand, research can be based on little quantitative information of limited relevance because the historical perspective of the economy was interrupted which determined that the data series statistics and identifiable economic policy details may no longer be relevant to the present times; on the other hand, economic policy decisions currently required a reactive adaptation to economic developments without historically relevant experiences often marked by an intuitive adaptation of developments. The model of economic rationality based on the consideration of maximizing the interests of economic agents were identified as being adapted to health security principles which made the theoretical retrieval of research difficult because a perspective in which we continue on pre-crisis behavioural expectations would be special. From conception, the results of those through which economic policies are currently based. For these reasons, during the research, we often used estimated values of economic indicators and we relied on the formulation of scenarios.

The Wholesale and retail trade—repair of motor vehicles and motorcycles (section G of the National Classification of Economic Activities)—represents a fundamental component of the Romanian economic mechanism. The understanding of the economic and social impact of this sector is important through both the substantiation of the strategies of competing companies, as well as through the perspective of the public policies that have an impact on this sector and on the socioeconomic environment. The purpose of this study is to analyze the impact of COVID-19 on the Wholesale and retail—repair of motor vehicles and motorcycles sector in Romania during the state of emergency period and to highlight the main measures proposed for diminishing the effects of COVID-19 and re-launching the sector. The research methods used to achieve the purpose of this study are the bibliometric analysis, the descriptive analysis and the k-means algorithm. The results obtained highlight an impact of the SARS-CoV-2 virus, which differs based on the nature, the goods (food and non-food products) and the trading method (traditional trade, online trading). The COVID-19 impact is also reflected in the number of individual labor agreements suspended or annulled, during this period, with many people entering into furlough or losing their job. At the same time, the recovery time after the previous crisis of 2008 was 6 years for the gross and retail trade overall. In order to reduce the recovery time of the Wholesale and retail—repair of motor vehicles and motorcycles sector as a result of the crisis caused by the COVID-19 virus, the authors propose a series of measures in both the economic and social sector and outline the expected effect as a result of these proposed measures.

The global problem of mankind, for more than a year, is the epidemic of coronavirus, which forces the authorities to take unprecedented measures to prevent the spread of Covid-19 virus. During this period, all sectors of the economy are affected, more or less. In this paper, we aim to analyse the water distribution, sanitation, waste management, decontamination activities before the pandemic (2008?2018), but especially during the pandemic, in order to develop economic and social measures. In order to achieve the objectives, the results of the questionnaire launched online, between May and June 2020, will be analysed.

The elaboration of the set of measures for this economic sector will be carried out taking into account the extraordinarily abrupt dynamics from day to day of the data on the spread of infections, doubled by the actions of the authorities for isolating the population at home and implicitly the severe restriction of economic activities, which makes the set of measures proposed at the end of this paper to give resilience to this economic sector.

The COVID-19 (Coronavirus) pandemic represents a historical moment that is certain to change our behavior forever. We are now witnessing numerous changes in the economy: unemployment is on the rise, people are losing their jobs, certain businesses close, and others thrive. This chapter presents, in the first part, the results of a survey carried out on a nationally representative sample of 1015 consumers. The questionnaire is intended to identify the main effects of the crisis caused by the COVID-19 pandemic on Romania’s economy and in particular on the population’s consumer behavior. In the second part of the chapter, we created a mediation model (structural equation modeling) starting from the respondents’ answers in the first part of the study, aimed at measuring the effect of the COVID-19 pandemic on the respondents’ consumer spending. The survey questions were divided by type into seven variables: COVID-19 Effect, government measures, consumer spending, respondents’ financial status, governmental and administrative measures in response to economic events, job change, and economy (inflation, unemployment, and prices).