Experts of HETFA prepared a report with recommendations commissioned by the European Climate Fund, entitled ‘Reopening, Crisis Management, Sustainability – Considerations and Recommendations for Developing Measures to Mitigate the Economic Impact of the Coronavirus in line with Sustainability Goals’. The report examines how crisis management, development measures supporting reopening can serve the post-epidemic recovery and preparedness for future epidemics, while improving the management of natural and social resources and making development in Hungary more sustainable.
The analysis formulating recommendations for national and local governments connected to economic policy defines 16 actions for measures. This includes both abstract regulations, starting from the topic of working conditions at home, through public space renewals and issues of logistics and land use interventions.
Below we present you a short English summary on the main findings of the report.
The reopening is Janus-faced. On the one hand, the world wants to return to the pre-COVID-19 normalcy, and most want to resume life where it was interrupted in early March. Even when restarting business, it is rational to build cooperation on previously established relationships and previous investments. The “other face” of the restart is looking to the future – we are looking for what we can learn from the experiences of the crisis, how we can make our lives and operations more resilient and sustainable in the medium and long term.
The future also depends significantly on what we think today, where social, economic and natural processes will take us, and what individual, community, business and government investments we will make now in the midst of the crisis and beyond. Our present-day view on what future may bring will become a self-fulfilling prophecy. The period following the peak of the epidemic should therefore be a period of creative rethinking, opening up for new opportunities and defining the future for individuals, communities, businesses, and the government.
In the case of Hungary, in international comparison, the quick government measures and the disciplined civic behaviour that complied with the restrictive rules made it possible to significantly slow down the spread of the epidemic and to quickly build up the missing health and epidemic management capacities. It has become clear that the ability for taking central and local actions is essential to manage well with the crisis. What is more, it is needed that state and local actors work together in a flexible and disciplined manner, which requires a high level of information flow. The extent of regional and local disparities and the effective management of community resources justify the preservation of local opportunities in territorial administration, which can be derived from the principle of subsidiarity.
In addition to the challenges of the epidemic, climate change has been also an important topic of public discourse. In recent decades, climate change – or, more broadly, sustainability issues – have become increasingly tangible and thus increasingly important in the debates of Western societies. There is no doubt that the current crisis will not solve these long-term problems (it will only divert our attention from it), but as we recover from the current epidemiological crisis, these problems and goals will once again be among the most important policy issues in public discourse.
When designing crisis management and reopening measures it is important to take into account the Sustainable Development Goals (SDGs). Recommendations of the report therefore were drafted in accordance with the findings of the National Sustainable Development Framework Strategy on the sustainability situation and trends in Hungary.
Recommendation for Economic Policy
Instead of applying the traditional Keynesian demand stimulus, the report advises governments in general and governments of small, open economies in particular to manage their resources the following ways:
- Providing jobs that pave the way for restructuring industries in the long run, increasing flexibility, adaptability and efficiency in the aftermath of the crisis.
- in case of companies, through technology investment and innovation support;
- in case of employees, with trainings and retraining;
- by supporting local collaborations that strengthen the fabric of society.
- Being involved in the development of infrastructure and public service systems that reduce the vulnerability of exchanges and cooperation by
- supporting local business partnerships;
- increasing the epidemiological safety of public/community infrastructures;
- Improving the quality of local public/community infrastructures.
- Implementing interventions to prevent the spread of epidemics and limit their spread and to improve the adaptability of society by:
- promoting a healthy, health-conscious lifestyle;
- increasing the proportion of ecologically valuable land and land uses;
- improving the productivity of natural resources (reduction of natural inputs and pollution) by exploiting the potential of the circular economy and the sharing economy;
- mitigating the effects of climate change by reducing greenhouse gas emissions and preparing for the effects of climate change, increasing our adaptive capacities
Recommendations for measures
In the light of the challenges posed by the current epidemic situation and the related economic policy context, the following proposals for measures are formulated, which are not exhaustive of all possibilities, but rather gathered as examples.
- Active support for part-time work from home
- Decentralization of leisure capacity
- Conversion of underutilized / brownfield sites into a public parks
- Securing wide sidewalks
- Development of adaptive public spaces
- Strengthening the adaptability of public transport
- Actively supporting the online operation of traders and service providers
- Aid for the purchase of electric vans and vans for freight transport companies
- Support for building energy investments, energy-saving building renovations
- Supporting the development of short supply chains in the food economy
- Support for organic farming in agriculture
- Support for land use change
- Encourage domestic and / or regional tourism
- Strengthening R&I capacities
- Introduction of eco-taxes, launch of green tax reform
- Promoting social responsibility and volunteering