2021 will be a challenging year for entrepreneurs

EUROCHAMBRES Economic Survey (EES2021) reveals the scale of the impact of COVID-19 on businesses across Europe, which predict a very difficult year ahead. The results show decreases across all indicators – domestic sales, exports, employment, investment and overall business confidence.

Businesses across Europe have been hit by a double whammy of severe production and consumption constraints since measures to control the spread of COVID-19 were introduced in early 2020. This, combined with continuing uncertainty about the trajectory over the coming months, weighs heavily on entrepreneurs.

The findings reinforce the chambers’ call for swift measures to support financial liquidity and strengthen market access, also underlining the need for a business-friendly approach to the EU’s long-term policy agenda. EES2021 results emphasise the critical need for investment support, so EUROCHAMBRES also calls on the institutions to reach agreement swiftly on the €1.85 trillion recovery package which could also contribute to a business-friendly approach to Europe’s twin transition to a green and digital economy. EES2021 is based on responses from over 58,000 businesses in 29 countries.

According to BusinessEurope’s Autumn Economic Outlook, the EU economy should shrink by 7.3% this year, while a growth of 5.0% is expected next year. This shows that pre-COVID levels of economic output will not happen in 2021 but it is hoped that the output will exceed 2020 levels in 2022. Apart from that, unemployment is expected to increase to 9.0% next year. All in all, all the figures show that businesses have been hit hard by the crisis and need to get back to growth as soon as possible.

Apart from a rapid agreement on the recovery package, businesses need a stable and predictable environment together with support programmes on a national as well as an EU level. In order to avoid further economic shocks, BusinessEurope hopes that an agreement between EU and the UK will be reached soon. Last but not least, businesses eagerly await the publication of the updated industrial strategy and SME strategy that must present a clear plan on how to support businesses in the green and digital transformations.