Regional Update CEE Covid-19 & Political Overview 28 APRIL – 31 MAY 2021 Table of Contents CROATIA ................................................................................................................................ 3 CZECHIA ................................................................................................................................ 5 HUNGARY .............................................................................................................................. 7 POLAND ................................................................................................................................. 9 ROMANIA .............................................................................................................................. 11 SLOVAKIA ............................................................................................................................ 13 2 CROATIA (prepared by CEC's Croatian partner - Vlahovic Group) COVID-19: • Given the number of active COVID cases dropped by 75% over the past 30 days (from 12,032 to 2,968), as of 28 May, significant easing has taken place: restaurants are allowed to serve guests indoors, the ban on private gatherings and ceremonies is revoked, wedding parties can have up to 120 guests (all participants shall be inoculated, tested or have proof they recovered from COVID-19), up to 100 people are allowed at public gatherings instead of 25, the limit of a maximum of 40% occupancy in public transport is lifted. More than 33% of the adult population was vaccinated with at least one dose. As for the EU green passport regime which is to enter into force 1 July, PM Plenkovic said it is very important for Croatia as a tourist destination and added that for the transition period he agreed with the PMs of Slovenia, Hungary, the Czechia, Slovakia, Poland and Austria to organize the movement of people according to the current concept: negative COVID test, certificates of overcoming COVID or vaccination certificate. Croatia is fully ready for the introduction of the COVID passports, being among the first EU countries that developed an interoperable platform. Business and economy: • In the spring forecast, the European Commission slightly reduced the estimate of the growth of the Croatian economy for this year to 5% (from 5.3% in the winter) and significantly increased the forecast for next year to 6.1% (from 4.6%). The EC believes that Croatia's GDP will exceed the level pre-pandemic. The Croatian economy fell 8% last year and the budget deficit amounted to 6.8% of the GDP. In May, Fitch Agency reaffirmed Croatia's investment credit rating of 'BBB-' and a stable outlook, noting high short-term risks associated with the pandemic, but also a better medium-term outlook for economic growth thanks to EU financial support. • The average net salary in Croatia in March 2021 amounted to HRK 7,138 (approx. EUR 952), which is nominally higher by 6.3% on an annual level. At the end of April, unemployment was reduced to 10,490 compared to April 2020. The Croatian Pension Insurance Institute data show that the number of insured persons at the end of April increased to 1,557,687, which is 37,097 more than in April 2020, but also 12,162 more than in April 2019. • A procurement procedure for granting a 50-year-period concession for the container terminal in the Port of Rijeka is completed – only one bid was submitted, by the Dutch APM Terminal BV in cooperation with the Enna Logic company from Croatia. A previous tender advertised in December, for which two bids were received, was cancelled. That time, one more bid was in play that came from the Chinese Ningbo Zhoushan Port Company Limited, Tianjin Port Overseas Holding Limited and China Road and Bridge Corporation. Politics and legislation: • The Croatian government has announced the decision on the procurement of 12 used fighter jets F3R Rafale. The entire package would cost €1 billion. The oldest jet delivered to Croatia 3 would be ten years old and all should be delivered to Croatia by 2025. The other bids were submitted by the U.S. for the new F-16 Block and Sweden for JAS-39 Grippen. • PM Plenkovic received Yang Jiechi, director of China's Central Foreign Affairs Commission Office. Plenkovic said the framework for China's cooperation with CEE had valuable potential as a unique initiative for building bridges, complementary to EU-China relations. Yang said China too supported the continuation of the cooperation with CEE countries based on market principles in order to create mutually beneficial projects. Plenkovic and Yang said they were pleased with the continuation of big projects in Croatia, such as the Pelješac Bridge and other investments, from the construction of the transport infrastructure to investment in renewables. Plenkovic invited President Xi Jinping to visit Croatia next year, on the 30th anniversary of Croatia-China diplomatic relations, and see the Pelješac Bridge, which will be built by then. • PM Plenkovic met with European Council President Charles Michel and Home Affairs Commissioner Johansson, who expressed strong support for Croatia's entry into the eurozone and the Schengen area as soon as possible. PM Plenkovic said that he expects a consensus on the matter among the Member States during Slovenia's EU Presidency which is starting on 1 July. Slovenian PM Jansa said his country also supports „the Schengen entry of Croatia, Bulgaria and Romania as it would strengthen security in Europe”. • The government will prepare amendments to the Trade Act to limit work on Sundays in retail; the exception of 16 Sundays a year will be left to employers which takes into account Croatia as a tourist country, the economy and partly consumer habits, and on the other hand achieves a balance of business and family life, according to the government. • The Croatian MFA met with his Spanish counterpart and expressed interest in joining the alliance of Mediterranean countries MED 7 or EuroMed 7, a group made up of Spain, Portugal, France, Italy, Greece, Cyprus and Malta. “Prime Ministers of the alliance are meeting in the autumn on Crete and Croatia, as a Mediterranean country, has all the prerequisites to be part of that club”, the Croatian Foreign Minister said. 4 CZECHIA (prepared by the CEC Government Relations office in Prague) COVID-19: • 15 385 active cases, 1 615 008 recovered, 30 088 decreased (as of May 28) • The pandemic situation in Czechia continues to improve and Covid-related hospitalizations are declining, currently at 669, of which roughly 123 are in serious condition, according to the latest data from the Ministry of Health • As of Monday 31 May, the indoor areas of restaurants, as well as bars, casinos and music clubs will open (these establishments will be open under strict conditions and hygiene and police checks will be intensified). At the same time, swimming pools, saunas, salt chambers and wellness facilities will be open to the public • The government has decided that starting in June, people will be eligible for coverage under public health insurance for 2 PCR tests and 4 antigen tests per month. • It will be possible to travel between the Czech Republic and Hungary, Germany, Poland, Austria, Slovakia, Slovenia and Croatia without restrictions after the first vaccination dose • Czechs with their first dose of the vaccine will also avoid having to prove a negative test when returning to their country from countries at medium and high risk of infection. • From Tuesday 1 June, anyone age 16+ can register for a vaccination • Children between 12 and 15 years of age could start getting vaccinated in the coming weeks. • EU Member States and MEPs have already agreed on the form of covid passports. The system is likely to be in place by the beginning of July. Business and economy: • On 17 May, the Czech government approved its National Recovery Plan worth CZK 200 billion (EUR 8 billion), which largely focuses on infrastructure and green development. The plan aims to help the country revive and modernize the economy after the COVID-19 crisis. Investments are planned in greener modes of transport, healthcare, high-speed internet networks and new pre-school care facilities. Climate-related projects account for 41% and digitization for 23% of the plan, as per the Commission’s set targets. The plan has yet to be approved by the European Commission and the Council of the EU. • The unemployment rate in Czechia fell slightly from 4.2% in March to 4.1% in April, according to the latest data from the Labour Office. This is the lowest rate of unemployment registered since December. The number of job seekers fell by almost 9 000 to 297 876 compared to March, while the number of vacancies rose by 4 500 to 343 407. The number of places has also increased by more than 10 000 compared to April last year. The number of unemployed increased by almost 44 000 year-on-year. According to the director of the Labour Office, Viktor Najmon, the coming spring period has seen a demand for seasonal jobs. Minister of Labour and Social Affairs Jana Malacova said that the government’s COVID-19 compensation package ‘Antivirus’ support programme helped mitigate unemployment. 5 Politics and legislation: • Update on diplomatic spat with Russia: On 2 May, a week after the investigation of Russia’s involvement in the 2014 explosion in Vrbetice went public, President Zeman issued his statement in a televised Sunday program for CNN Prima News, neither confirming nor denying the allegations, but rather stating that a deeper analysis