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Publication(Washington, DC: World Bank, 2021-10-05) World BankAlthough global economic activity is recovering and output in Europe and Central Asia (ECA) is expected to grow in 2021, containing COVID-19 remains a challenge in the region. Enterprise survey data for the emerging and developing countries in the region show that COVID-19 had a profound and heterogeneous impact on firms. Smaller, younger, and female-run businesses were hit harder and had greater difficulty recovering. But the crisis also played a cleansing role and economic activity in ECA appears to have been reallocated toward more productive firms during the crisis, particularly in countries with more competitive markets. Firms with high pre-crisis labor productivity experienced significantly smaller drops in sales and employment than firms with low pre-crisis labor productivity and were also more likely to adapt to the crisis by increasing online activity and remote work. Many governments in ECA implemented broad policy support schemes to address the initial economic fallout from the crisis. Overall, this government support was more likely to go to less productive and larger firms, regardless of the level of their pre-crisis innovation. As economies enter the economic recovery phase, it will be important for policy makers in all countries to phase out broad policy support measures as soon as appropriate and focus on fostering a competitive business environment, which is key to a strong recovery, resilience to future crises, and sustainable, long-term economic growth.
How the Crisis Changed the Pace of Poverty Reduction and Shared Prosperity: Armenia Poverty Assessment(World Bank, Washington, DC, 2015-06) World Bank GroupThis report examines Armenia’s experience in reducing poverty and raising the welfare of the least well-off in the country in the years since 2009. What households spend on consumption is an indicator of their welfare. As the economy recovered from crisis, the least well-off enjoyed some growth in consumption spending, but not as much as in the years up to 2009. Moreover, growth has become less pro-poor in relative terms because the less well-off enjoyed lower growth in consumption than the better-off. As a result, although consumption did translate into a reduction in poverty, inequality is now higher than before 2009. In 2013, 32 percent of Armenia’s population lived below the national poverty line, a poverty rate higher than in pre-crisis years but down from the high of 35.8 percent in 2010. In fact, between 2012 and 2013, poverty reduction seems to have stalled. This report looks at the micro and macro aspects of Armenia’s poverty reduction experience to: (a) describe the key features of post-crisis poverty, inequality, and consumption growth; (b) examine the drivers of poverty reduction in this period; and (c) explore reasons why future growth might not be as pro-poor as in the past.