Economic Monitor Issue 12 | June 2020


  • Due to the COVID-19 pandemic, the economy is forecast to shrink by 6.0% in 2020. In 2021, real GDP will grow by 3.5%
  • The main negative impact comes from the external side, where oil-related problems with Russia and low global energy prices reinforce the shock. Contrary to most other countries, domestic lockdown measures are rather weak
  • Inflation remains under control (2020: 6.5%), and the National Bank continues to cut the key interest rate. Real wages keep growing in the run-up to the presidential elections
  • All the factors mentioned put pressure on the budget: balance will deteriorate significantly in 2020 to -4.6% of GDP. Correspondingly, the debt ratio will jump in 2020 (59.6% of GDP)
  • The exchange rate weakened significantly during 5M 2020 (-14.5%), and the national bank had to sell foreign exchange reserves (latest: USD 7.9 bn); import coverage dropped to 2.6 months
  • Current account deficit will widen in 2020 (-2.9% of GDP), before improving slightly in 2021 (-2.5%)
  • External trade will take a hit in 2020, as both exports (4M 2020: -19.1%) and imports (-20.6%) shrink among the global COVID-19 crisis, the energy dispute with Russia and low global energy prices


  • Russian oil tax manoeuvre. Gradual loss of preferential access to Russian oil imports poses significant mid-term challenges to the budget and external accounts
  • COVID-19. Development of cases, domestic measures, policy response, international financial support
  • Download Economic Monitor 12/2020