Ukraine faces a series of debt bankruptcies and a 20% drop in industrial production
Due to the total quarantine announced by the Ukrainian government, the country faces devaluation of the national currency and enormous economic problems.
The Kiev online publication “Zerkalo Nedeli” draws such prospects for the Ukrainian economy following the quarantine.
Referring to information from the President of the Ukrainian Chamber of Commerce and Industry Gennady Chizhikov, the authors indicate that in total about 4 million people are forced to not work due to quarantine.
After quarantine, the article notes, “tens and even hundreds of thousands of enterprises, especially micro and small businesses, may not open at all,” and Ukraine “will be overwhelmed by a series of debt bankruptcies,” since “many small ones worked on the edge of profitability in the hope of better times that never came.”
“Alas, the entire information background on the national economy is sharply negative. Minus 10% of foreign trade turnover - only in March, when the quarantine had not yet broken the supply chains. And this is just the beginning. Expectations are much more pessimistic,” the publication laments.
“An extra can of gasoline into the fire of panic in the minds of external and internal creditors” is the expected technical default of DTEK, the country’s main energy enterprise, and the suspension of payments on Eurobond coupons and interest on bank debt.
“The wariness of bank depositors, for some of whom payments in dollars have been practically officially limited, is another factor of distrust in the future, when the 3-6 month terms of deposits expire, and depositors will be faced with two questions: should they extend and convert their savings? All this, together with the planned repayments of government bonds in the third quarter, carries the risk of a second wave of devaluation of the national currency,” the publication says.
“A fall in metallurgy by 7% in February and by 10% (expected) in March will worsen the already illusory prospects for our industry and will once again only drag industrial production indices further down. In the future, unless a miracle happens, the rate of decline may reach 20%,” the publication summarizes.
As PolitNavigator reported,
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