Political and Economic Consequences of the COVID-19 Pandemic in the Eastern EU Member States

LGBT+ activists at a Andrzej Duda election meeting on June 15, 2020. CC by Krzysztof Greenpeace Polska https://bit.ly/3j0mvTn

The COVID-19 pandemic has triggered a massive economic recession with unforeseeable consequences. The economic recession rapidly brought an end to the strong economic growth rates in the eastern EU member states and is likely to trigger a new wave of disappointment in the region. Moreover, the COVID-19 crisis might reinforce already existing regional political trends, threatening democracy and its institutions.

The COVID-19 pandemic and the containment measures caused an unprecedented economic disruption in the EU and other regions in the world. In its Spring 2020 forecast, the EU Commission expects real GDP of the EU to decrease by 7.4 per cent in 2020, particularly Italy (-9.5), Spain (-9.4), Greece (-9.7) and Croatia (-9.1). Although the forecast predicts economic growth for 2021 (EU27: 6.1), the EU will have to deal with the consequences of the lockdown in the upcoming years until the pre-corona level is restored.

The Economic Gap Between Western and Eastern EU Members

Regarding economic strength of EU member states, the prevailing gap between (north) west and (south) east will be hardly affected by the COVID-19 crisis, although the eastern member states have fared better than EU other regions until now. As Graph 1 shows, the eastern members that joined the EU in 2004, 2007 and 2013 display the lowest GDP per capita among all member states.

Graph 1: Real GDP per Capita in the EU in 2019 (Thousand Euros)

Source: Eurostat

The COVID-19 crisis meant the end of a period in which the members in the east managed to move closer to the EU average due to stronger economic growth rates. This catching up process is expected to slow down in the near future. The eastern members are often referred to as “dependent market economies”, as they heavily depend on a transfer of know-how and production from the western members. This dependency makes those economies in the “semi-periphery” more vulnerable to external shocks.

With the new proposed recovery funding on the EU level (in terms of the Multiannual Financial Framework (MFF) 2021-27 and the 750b recovery grants) old and existing fault lines between east and south might emerge, as the eastern members might think that less EU funding will reach them. Hungarian Prime Minister Victor Orbán already called the EU recovery plan of the Commission “absurd” in late May, as it “would help richer member states more”. The initial alliance between southern and eastern member states of November 2019 jointly rejecting EU budget aid cuts has vanished quickly, since the COVID-19 pandemic changed the situation dramatically. Additionally, discussions about rule-of-law criteria for EU funding continue concerning the 2021-2027 MMF to react to the erosion of democracy in Hungary or Poland beyond ongoing Article 7 procedures. In the light of those developments, the EU Commission needs to act carefully to bridge emerging divisions between the regions in the ongoing negotiations of the upcoming budget.

The Five Crises of the Eastern EU Members Since 1989

The 2020 economic recession has caused a new wave of economic issues to the EU, particularly to the southern and eastern members. Since the end of the state socialist regimes in 1989/91, one of the main goals of the transformation to democracy and market economy was to catch up with Western standards. Hungarian political scientist Attila Ágh (2015) identified three major moments or processes causing disappointment regarding the expected improvement of living conditions in the past 31 years in the region: (1) the neo-liberal economic transformation since 1989, (2) the eastern enlargement of the EU starting in 2004 and (3) the economic crisis in 2008. Complementing Ágh’s assessment, the management of the increased migration to the EU in 2015/2016 and the economic recession of the COVID-19 pandemic can be seen as a fourth and fifth major crisis that heavily shaped the eastern member states since 1989. Beyond economic dimensions, they are all moments and processes that highlight different levels of unfulfilled expectations.

Emigration, Apathy and Populism

Those social, cultural and economic crises have great impact on politics. Growing disappointment and frustration stemming from economic and political developments have led to three main political consequences: (1) people “vote with their feet” and migrate to other countries, (2) turn politically apathetic and join the group of non-voters or (3) people become more prone to follow populist and nationalist parties.

As Graph 2 presents, a gap between west and east can also be observed regarding population change. Especially, the three Baltic states and south eastern countries such as Romania, Bulgaria or Croatia experienced a heavy decline in population of some 15 per cent or more in the past decades. The Visegrád-4 and Slovenia are less affected by mass migration, still lie way below EU average.

Graph 2: Population Chance in EU Member States 2019 Compared to 1990 (difference in per cent)

Source: Eurostat (Tobias Spöri)

The second political consequence - growing political apathy - is shown in Table 1. When comparing turnout in the first parliamentary election since 1989 to the latest one, most countries display a sharp decline in turnout. After a short period of enthusiasm for the new democratic system in the early 1990s, larger parts of society joined the group of non-voters. Particularly the economic losers of the transformation since 1989 are affected by political apathy.

Table 1: Comparing Turnout in the First and Latest National Election After 1989

Turnout, first election Turnout, latest election Difference in per cent
Bulgaria 90,8 (1990) 54,1 (2017) -36.7
Czech Rep. 96,3 (1990) 60,8 (2017) -35.5
Croatia 75,6 (1992) 54,4 (2016) -21.2
Estonia 67,8 (1992) 64,2 (2019) -3.6
Hungary 65,1 (1990) 68,1 (2018) +3.0
Latvia 89,9 (1993) 54,6 (2018) -35.3
Lithuania 75,2 (1992) 50,6 (2016) -24.6
Poland 43,2 (1991) 61,7 (2019) +18.5
Romania 86,2 (1990) 39,8 (2016) -46.4
Slovakia 95,4 (1990) 65,8 (2020) -29.6
Slovenia 85,9 (1992) 52,1 (2018) -33.8

Source: Parties and Elections in Europe (Tobias Spöri)

In recent years, populist parties and politicians managed to be increasingly successful in elections in the eastern members of the EU and partly have dismantled democratic institutions after taking office. Apart from the well-known cases of Orbán’s Fidesz in Hungary or the Polish PiS party, several eastern members are governed by populist parties, such as Babiš in the Czech Republic, the newly formed coalition in Slovakia under Matovič, Slovenia’s Janša, Bulgaria’s Borisov or Mart Helme from the Estonian EKRE party. As seen in several (eastern) member states, populist leaders seized the opportunity during the COVID-19 pandemic to strengthen their position and portray them as saviours of their country. The recent presidential elections in Poland or the parliamentary elections in EU candidate state Serbia provide first evidence that populist parties continue to be successful in the region. In times of crisis and insecurity, many voters appear to prefer political stability and strong leadership over democratic procedures and public deliberation. It remains to be seen if a longer lasting economic crisis can open a window of opportunity for the opposition or social movements to gain popular support and mobilise people for their cause.

Key Messages

  • The current public health crisis is to an extent milder than expected in the eastern EU members, despite several state administrations were not very efficient.
  • The COVID-19 pandemic brought an end to the strong economic growth rates of the eastern EU members and might hit those semi-peripheral economies harder than other EU members.
  • The 2020 economic recession means a new wave of economic disappointment to the eastern EU citizens, which have experienced several disappointments since 1989.
  • Old fault lines between eastern and southern members might emerge regarding the new proposed recovery funding on the EU level but also the long-term budget for 2021-27, as more money is likely to be distributed among the southern members.
  • The COVID-19 pandemic will reinforce already existing trends in the eastern member states regarding emigration, political apathy and populist politics.
  • EU institutions and the European public should closely observe the political developments in the Eastern member states, particularly in countries like Hungary where some of the emergency measures are still in place although the state of emergency was officially terminated in June.
  • European institutions, including European party families like the Europeans People’s Party (EPP), need to take a clearer stand whenever European values or rule of law are violated in any EU member state.
  • A fair assessment of the current state of the EU and its member states is required, when it comes to restructuring the EU after the COVID-19 pandemic. Among other things, this assessment needs to take into account the erosion of democratic institutions and principles in some eastern member states, but at the same time, the labour conditions of seasonal or permanent workers from eastern members in western member states, particularly in the care sector, food production and tourism.
  • Additionally, the long-term consequences of strong emigration from eastern to western member states regarding demography, social policy and depopulation should be taken into account more on the European level.

 

About the author

Dr. Tobias Spöri is a political scientist at the Department of Political Science of the University of Vienna. His research deals with political participation, Central and Eastern Europe, and European Integration.