Business Update – March 19: Emergency IMF support, no tax for farmers, cleaning cash

Ukraine is in talks with the International Monetary Fund over the possibility of receiving emergency financing due to COVID-19, the National Bank of Ukraine stated. The new talks go together with the ongoing negotiations with the IMF on the opening of a new Extended Fund Facility credit line.

The IMF could give Ukraine $50 billion through its emergency financing facilities – new measures announced by the IMF for low-income and emerging markets suffering from the coronavirus pandemic, NBU governor Yakiv Smolii has said. “The results of the negotiations will be in the coming weeks,” he said.

Ukrainian farmers have been exempted from paying land tax for two months. The state has exempted agricultural producers from land tax and rent for state-owned agricultural land for two months to help companies during the coronavirus crisis.

The NBU is sending disinfected cash to Ukrainian bank branches. The NBU said it would provide banks with clean cash until May. Banks need to replace money that is not disinfected amid fear that older notes could help spread the coronavirus. “The National Bank will provide banks with cash support free of charge (until May 1, 2020) and take into account their needs regarding the sums and the amount of cash,” the central bank stated.

The NBU has also permitted banks to allow beneficial conditions on the servicing of loans if it does not affect the capital of a bank, the regulator stated on its website. “Customers are nervous and ask for real restructuring approaches. Get started now,” said First Deputy Governor of the NBU Kateryna Rozhkova.

The central bank also introduced long-term refinancing of banks for up to five years, Interfax-Ukraine reported. “This step is aimed at meeting several goals at once, related both to maintaining financial stability in the country and stimulating economic growth,” the regulator said.

Ukraine International Airlines is selling tickets for charter flights from Dubai, Tel Aviv, Larnaca (Cyprus) and London to Kyiv, amid a move to evacuate Ukrainians from abroad. The national airline was criticized at the weekend for increasing the price of some tickets as Ukrainians rushed to get home.

The airline’s low-cost competitor SkyUp will carry out charter flights from Vienna, Zurich, Paris and Lisbon to Kyiv. SkyUp has already flown government charter flights from multiple coronavirus-stricken countries, including China and Italy, to evacuate its citizens. SkyUp also said in a statement that flights from other cities will be carried out if the airline receives information that there are citizens there who want to return to Ukraine.

Coronavirus has caused some panic buying in Ukraine, but few shortages are reported. The number of people shopping for staple goods has increased recently, but it is hardly as massive as in other countries. Ukraine has reported 21 cases of COVID-19, among the lowest numbers in Europe. There have been three deaths from the illness.

Lawmakers Derkach, Dubinsky have proposed a law banning foreigners from supervisory boards of Ukrainian state-owned enterprises. In addition to the ban on foreigners taking seats in the supervisory boards of SOE, including its state-owned banks, the highest monthly payment to the members of supervisory boards should also be fixed, the bill suggests. The legislation is a move that is backed by some Ukrainian oligarchs, such as Ihor Kolomoisky, who want to take back control of entities like PrivatBank, nationalized in 2016 with $5.5 billion missing from its balance sheets.

More than 10,000 Ukrainian tourists remain in Egypt, the ambassador there has said. “Four days ago there were more than 30,000. At 4 p.m. Kyiv time, 10,352 Ukrainian tourists remained in Egypt,” he said on the Ukraine 24 TV channel on March 19. At least 730 of those tourists are quarantined at two hotels where COVID-19 was detected.

Five Ukrainians entered the Forbes 30-under-30 success lists. Amid the doom and gloom of the present as the world fights the global spread of the novel coronavirus, Forbes has published its annual 30 Under 30 lists that highlight successful people from 32 European countries who are still under 30 years of age.

Half a million Ukrainians may lose jobs in the COVID-19 crisis. Former Economy Minister Tymofiy Mylovanov claims 500,000 Ukrainians might lose their jobs because of the economic crisis caused by the novel coronavirus pandemic. “And it’s a conservative estimate,” he said, pointing out that in coronavirus-stricken China, the unemployment rate has grown by 1% over the past month.