Mr. Beočanin shares the key conclusions of the impact of COVID 19 on SEE local governments at the JCC CoR - Serbia meeting
On 10th of June 2021, the Joint Consultative Committee meeting of the European Committee of the Regions (CoR) and the Republic of Serbia took place.
On behalf of NALAS, Mr. Beočanin was invited to speak during the session dedicated to “Sustainable Recovery from the Covid-19 Crisis together with Regional and Local authorities in Serbia” where he referred amongst other to the findings of NALAS survey dedicated to “THE COVID-19 SOCIAL AND ECONOMIC RECOVERY AT THE LOCAL LEVEL IN SOUTH-EAST EUROPE”.
Mr. Beočanin shared the key conclusions with participants from the diplomatic representation of Serbia to the EU, the Commission’s DG NEAR, the Standing Conference of Towns and Municipalities of Serbia, the Serbian State Secretary of the Ministry of Public Administration and Local Self-Government, Mayors from Kruševac and Niš as well as the EU Delegation to the Republic of Serbia.
Mr. Beočanin stressed that SEE local governments face and will continue to face unprecedented financial pressures. On the one side, SEE local governments’ spending has increased to respond to the crisis and support their local communities. On the other side, their revenues have been falling down because of the lockdown, the fall in economic activity, consumption and jobs, the closure of certain local services and utilities, and also because of the fiscal relief measures adopted to support local economies and individuals.
Furthermore, at the peak of the crisis and during the “lockdown” (March-June 2020) local revenues were severely hit - in 81 % of SEE, local governments’ own revenues decreased by more than 10% and 20% in annual terms. In the same time, also intergovernmental transfers fell for 65%. As a result, local capital investments fell by more than 20% in more than a third of SEE local governments.
Last but not least, Mr. Beočanin highlighted the challenges in local finances which according to the NALAS survey are expected to continue over the short and medium term. Most SEE local governments expect a pessimistic or very pessimistic outlook for the years 2020 to 2022. Overall, cumulatively, by 2022 SEE local governments may lose up to 30% of their revenues compared to 2019 for a total estimated loss of 17 billion Euro, which would have devastating effects for local governments and will compromise their ability to provide services and improve infrastructure.