Report Contents

March 18, 2021

Europe

EUROPE: CEE PULSE

BY Andrius Tursa

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( 4 mins)

The Covid-19 pandemic is spreading swiftly across the region, and most countries have been forced to introduce strict countrywide or regional lockdowns. Despite soaring infections, the general elections in Bulgaria remain scheduled for 4 April. In the Czech Republic, the parliament is set to hold a final vote on a contentious legislative proposal introducing quotas for domestic food products in retail stores. Finally, Russia is bracing for a new round of sanctions from the US amid a further deterioration in bilateral relations.

Region

This week, new nationwide lockdowns have been announced in Poland (20 March – 9 April) and Bulgaria (22-31 March). Existing lockdowns are set to remain in place in the Czech Republic (21 March – to be extended), Hungary (22 March – to be extended), Slovakia (until revoked) and Estonia (until 11 April). The epidemiological situation is rapidly deteriorating in Croatia, Romania, Serbia and Ukraine, all of which rely on regional restrictions/lockdowns. For now, the health situation remains relatively stable in Latvia, Lithuania, Russia, which are gradually relaxing restrictions. In terms of vaccinations, Serbia and Hungary – both of which have included the Sinopharm and Sputnik V jabs into their vaccine portfolios – are clear regional leaders and are on track to vaccinate 60-70% of their populations by late summer/early autumn.

From a political perspective, the more than a year-long pandemic has contributed to a weakening of long-standing governments across the region, which may result in a wave of political change. For example, the Law and Justice party in Poland (in office since 2015), the Fidesz party in Hungary (in office since 2010), the ruling Action of Dissatisfied Citizens (ANO) in the Czech Republic (in office since 2017) or Citizens for European Development of Bulgaria (GERB, in office since 2009 with a short intermission in 2013) are all polling at multi-year lows and are facing highly competitive electoral battles in the coming months and years.

Bulgaria

The seven-day rolling average of infections increased by 35% during the past week and is approaching the peak levels observed in the second half of November. A ten-day nationwide lockdown is set to come into force on Monday, 21 March. The capital Sofia will close down a few days earlier, on 19 March. Meanwhile, Bulgaria’s vaccination campaign remains one of the slowest in the EU. This is associated with a prioritization of the AstraZeneca-Oxford (AZ) vaccine, which was approved by the European Medicines Agency later than the Pfizer-BioNTech and Moderna vaccines and experienced notable supply issues. On 12 March, Sofia suspended immunizations with AZ over safety concerns, which has brought its vaccination campaign virtually to a halt. Nonetheless, the Boyko Borisov government is unlikely to start talks with China or Russia regarding vaccine deliveries, at least until after the general election scheduled for 4 April.

Despite the resurging pandemic, there is no active discussion in parliament to postpone the vote. Fear of Covid-19 could lower turnout, which under normal circumstances would benefit well-established parties with stable electorates such as the center-right GERB, the center-left Bulgarian Socialist Party or the ethnic minority Movement for Rights and Freedoms. However, the pandemic might disproportionally lower turnout among elderly voters, which could provide a boost to newcomers such as There Are Such People or Democratic Bulgaria.

Czech Republic

On 17 March, the upper house of parliament rejected an amendment to the Food Act, which would set quotas for domestic food products in large retail outlets starting 2022. The bill will now come back to the lower house of parliament, where it needs support from an absolute majority of deputies to be adopted. However, following strong criticism from the European Union, Agriculture Minister Miroslav Toman (independent) has withdrawn his support for the amendment. This somewhat reduces the probability of the bill advancing through the lower house, although the ruling ANO together with the Communist Party of Bohemia and Moravia, and the nationalist Freedom and Direct Democracy party (SPD) still have enough votes to pass it. The contentious bill could become part of the campaign ahead of the general election in October.

Russia

Recent statements from the Joe Biden administration suggest that it will soon announce sanctions on Russia in response to the alleged interference in the 2020 US presidential election and the so-called SolarWinds cyber-hack. Given the nature of these incidents, it would not be surprising if the US sanctioned individuals/entities linked to Russia’s military, intelligence and IT/tech sectors. Biden’s National Security Advisor Jake Sullivan has previously mentioned that part of the response “may not be visible to the broader world.” The escalating bilateral tensions in recent weeks also raise the probability of Washington’s tough response against Russia, which may target, for example, President Vladimir Putin’s inner-circle associates (and companies linked to them), as well as entail restrictions on economic or financial sectors.

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