As the third week of Ukraine’s coronavirus quarantine draws to a close, tens of thousands of Ukrainians are running up to a very pressing issue – their money is running out. James Brooke, editor-in-chief of the Ukraine Business News, speaking during a recent airing of the Weekly Wrap-up, explained exactly what risks the country is facing as the quarantine continues.
“Surveys show that the average Ukrainian has one month of margin, or cushion. And in the east, the south-east area where the conflict is going on, it’s only two weeks,” noted Brooke in his comments. With approximately 700,000 jobs lost, at last count, Ukrainians are risking running right up against the limits of their cushion.
“There really isn’t much of a safety net,” said Brooke, pointing out that social support for unemployed Ukrainians lags in comparison to many other countries. And that means Ukrainians need to get back to work.
Editor-in-chief of the Ukraine Business News James Brooke at the Hromadske studio in April 2018. Photo: hromadske
Hope for that, however, depends both on the vagaries of the coronavirus – and of government policy. “I think the government is increasingly aware of that, and trying to phase in certain industries. In a country where 40% exports are food...they actually shut down the sale of feed, seed, fertilizers, pesticides, just as the spring sowing season is starting.” But, Brooke said, there are signs that the government is loosening some working restrictions, despite the lockdown. “They’re gradually letting people do work, like external house painters, or people selling construction materials, that if they wear a mask, there’s no reason to shut them down.”
But despite relief measures being debated and passed in Ukraine’s parliament, a question remains if “the money will really get to people” – Ukraine’s history of corruption makes it difficult to trust government expenditures fully. Yet, even if Ukrainians do get back to work, Ukraine’s economy still seems rocky – despite the passage in the first reading of a bill, required by the International Monetary Fund for new loans – investors around the world have been pulling out of emerging economies in fear of the coming economic crisis.
“The IMF says $81 billion has left the emerging markets in a big whoosh, the biggest move of capital out of emerging markets that they've ever seen...This will be a lost economic year,” the UBN editor-in-chief believes.
Yet, Ukrainians may still have some options – Poland, always an attractive target for migrant Ukrainian labor, has been “desperate” for Ukrainian workers since the start of the lockdown.
“They said, Oh, you know, we'll have an amnesty on visa overstays, we'll give you free testing for [coronavirus], we’ll give you free treatment of the hospitals for [coronavirus]. I mean, they really are tailoring a package to keep the Ukrainians they have, and to bring more back. And the Polish construction Union and the Polish Farmers Union have specifically leaned on the government, ‘saying we need the Ukrainians back to keep going.’”
But even if Polish attempts to entice Ukrainian migrant labor into the country are successful, that still won’t address the structural issues facing Ukraine’s economy for the rest of the year, and going into the next – and there are still no clear answers for what Ukraine may face in the near future.
/By Romeo Kokriatski
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