Business: HGK – 95% of Croatian companies affected by coronavirus fallout

The coronavirus pandemic is increasingly affecting the Croatian economy, with micro-businesses being hardest hit, the Croatian Chamber of Commerce (HGK) said on Wednesday.

The survey, covering over 2,700 companies, showed that as many as 95% of companies had reported declines in turnover and that 28% had suffered declines of 100%.

Three-quarters of the companies surveyed, or 74%, reported drops in production, and a fifth of them, or 21%, had seen their production fall by 100%.

Supply chains have also been hurt by the outbreak, with 61% of companies reporting problems.

Forty-five percent of companies recorded declines in exports and 41% reported falls in imports. In such circumstances it is no wonder that 42% of those polled are considering layoffs and as many as 37% are thinking of closing down, the HGK said.

“These figures show that the coronavirus crisis will not spare anyone and that is why we need to urgently help the most affected sectors of the economy by exempting them from paying all dues, co-financing wages and granting them moratoriums on loan repayments. We must act pro-actively and preventively, rather than passively respond to what is happening to us,” HGK president Luka Burilovic said.

As for labour shortages, the survey revealed that this problem is not so acute as two-thirds of companies currently have no problem with labour shortages, while 27% are facing problems caused by sick leave and self-isolation.

The survey also gauged the interest of companies in 63 measures the government had adopted to help the economy cope with the present crisis. Most of them showed an interest in the deferral of payments of taxes and contributions (56%) and in aid to preserve jobs (50%).

Thirty-five percent of companies were interested in new loans for liquidity and 32% welcomed the move to introduce a moratorium on the repayment of the existing loans.

Broken down by sector, the greatest interest in the latest government measures was shown by companies in the manufacturing industry, services, retail, transport, construction and tourism.