A lead economist at the EBRD has published a report on how the crisis evolved and how it has affected this region. It also points out the vital role played by international actors. Not only has there been strong financial support from publicly owned international organisations, but also privately owned foreign companies and banks have refused to rush for the exit, reflecting a major and, so far, largely successful coordination initiative. The paper concludes that the region is well-placed to take advantage of a future global upturn – whenever that might take place – but at growth rates that are likely to be subdued compared with those seen in the few years before the crisis.
The next section describes in some detail the evolution of the main macroeconomic indicators, highlighting the relative resilience of the region and the absence of the kind of output collapses seen elsewhere in the transition region, such as in the Baltic states and Ukraine. It also explains the importance of three contributing factors: the sharp drop in exports; the choking-off of credit; and the effect on remittances. Section 3 shows how the region has responded to the crisis. Most people were totally unprepared for what happened, but despite this, the reaction both of governments and of businesses and workers has been generally mature and appropriate to the circumstances. Section 4 highlights the international dimension – both the direct support from abroad and the spillover effects from the fiscal stimulus and liquidity expansion programmes in advanced countries. Section 5 offers some concluding thoughts and lessons for the future.