The next Transition Report of the European Bank for Reconstruction and Development (EBRD) claims that 45 percent of residents of the former socialist countries currently support an increase in the share of state ownership in the economy.
More and more citizens hope that the state will be able to reduce the epidemiological and economic risks they face.
According to EBRD Chief Economist Beata Javorcik, the ability of developing economies to pursue successful policies against the background of growing government influence is critically dependent on the quality of institutions and public administration.
«The economies in the regions where the EBRD operates are at a crossroads: today’s decisions about what policies to pursue and what institutions to develop will determine the way these countries will evolve for decades to come. The current period of crisis shocks, which opened with the global pandemic, provides a unique chance to lay the foundation for a more prosperous, fair and «green» future,» Beata Javorcik notes.
The economist emphasizes that if the institutions become weak, they will not be able to resist the government’s desire to «appropriate» the resources intended for those in need, to employ friends and family, and to use state banks for political gain.
In the long term, the EBRD analysts emphasize that the state should promote the process of «creative destruction» and provide social support to those workers and communities affected by the transformation of the economic order.