World experts put a high value on Moscow Government steps to overcome the pick-virus aftermath
Experts of Ernst and Young (EY) put a high value on Moscow Government measures to overcome the pick-virus aftermath. The strategy chosen by the city officials made it possible to keep the unemployment rate at its minimum while preventing significant economic downfall. Due to this, an optimal set of measures to overcome the pick-virus aftermath was successfully implemented. The information about it is contained in the study “COVID-19 in world metropolitan cities” made by the EY international company.
The study’s authors checked the impact of restrictive and supporting measures on business environment in nine world metropolitan cities: Moscow, London, Paris, New-York, Singapore, Hong Kong, Madrid, Oslo and Stockholm. The study represents dynamics of COVID-19 pandemic, analysis of phased restrictive measures, supporting measures for citizens and businesses, the impact of pandemic on economy as well as channels to notify the population.
“When the pandemic started, five sets of measures amounting to almost RUB 90 M were implemented to support businesses in Moscow, about 57.6 thousand companies are still using them. The steps we took not only made it possible to support urban economy in Moscow, but also to maintain investment and business environment. Now we are witnessing gradual recovery of economy and consumer demand: the overall turnover of merchants and service providers for four months of this year has totaled RUB 4.4 T, which 37% higher than that of the same period last year. Labor market shows the same positive trend: the number of the unemployed registered with the Employment Service has decreased by 45.8% since the beginning of the year,” Vladimir Efimov, Deputy Moscow Mayor for Economic Policy and Property and Land Relations, noted.
The Russian capital was one of the few to achieve well-balanced results. According to the study’s authors, an optimal set of measures comprises timely imposition and elimination of restrictions, effective communication strategy, and supporting incentives. This approach made it possible to effectively overcome the pick-virus aftermath and launch the process of economic recovery.
“Moscow officials managed to strike a balance between restrictions and supporting measures while keeping the economic potential. Early indications say that the economy shrank only by 4%. The economic downfall under flexible restrictions was less prominent only in New-York (-3.3%) and Stockholm (-2.8%) while showing the worst indicators of morbidity and mortality. Today Moscow economy is on the rise,” Olga Arkhangelskaya, an EY partner, Head of the Section for Providing Services to Real Estate, Hotel Industry and Construction Sector Companies, and State Companies in the CIS, noted.
The study also noted that the unemployment rate in the capital was the lowest among the cities concerned. September 2020 witnessed the peak value with more than 223 thousand people (about 3%) being unemployed. As of March 2021, the situation is back to normal with values close to pre-pandemic ones (less than 1%).
The experts noted that financial support was crucial to keep the businesses afloat, however support in adaptation and transformation of businesses to effectively work online was just as important with a majority of companies switching to remote work mode. Moscow and New-York where such nonmonetary supporting measures were actively implemented could faster launch recovery process.