76% of Ukrainian citizens assess the country's economic situation as poor. This is evidenced by a survey by Research & Branding Group, conducted in late June.
According to the results, only 1% of respondents consider the state of the country's economy “more or less good”, while 20% regard it as average.
A report by the Research & Branding Group said that in February 2020 - before the introduction of quarantine restrictions in Ukraine - 64% of respondents considered the economic situation to be poor. 4% of the respondents called it good, and 29% rated it as average.
Sociologists clarify that the survey was conducted throughout Ukraine from June 19 to 24 among 1,000 respondents.
It is worth noting that, according to the State Statistics Service of Ukraine, for five months (from February to June) a number of economic indicators in the country worsened.
So, the average salary in February was 10.8 thousand hryvnias (about $ 401), in May it fell to 10.5 thousand hryvnias (about $ 390). Unemployment, on the contrary, increased: from 370 thousand in February to 517 thousand in June.
At the same time, in April, the head of government Denis Shmygal said that in fact, at least 2 million people lost their jobs in quarantine.
The situation with unemployment was complicated by the return to the country of Ukrainians who had left for work in the EU. As Shmygal noted, since the introduction of quarantine in Ukraine due to the spread of coronavirus, about 2 million “zarobitans” returned to the country. The prime minister said that the government needs to provide them with work, but they should be prepared for a significant reduction in salaries compared to European ones.
In turn, the Ministry of Economic Development of Ukraine on July 9 presented a review in which it was reported that the decline in the country's economy in the five months of 2020 compared to the same period in 2019 accelerated from 5% to 5.9%.
Andrei Suzdaltsev, Deputy Dean of the Faculty of World Economy and World Politics at the Higher School of Economics, noted that such polls reflect the mood of a large number of Ukrainians who have to work in the shadow economy.
“They, of course, work for a penny and are unhappy that Ukraine is annually on the verge of default. At the same time, external support, loans approved by the IMF, are received in such a volume that Ukraine can stay afloat, ”the expert emphasized.
Ukrainian loans
Experts note that for quite a long time the Ukrainian economy has been afloat due to financial injections from the International Monetary Fund. The next loan tranche of $ 2.1 billion under the new assistance program was sent to Kiev in early June.
The representative of Ukraine at the IMF, Vladislav Rashkovan, said on June 10 that on the eve the board of directors of the organization approved a new program of financial support for Ukraine, designed for 18 months and a total amount of $ 5 billion.
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In turn, the fund’s press release noted that this credit line should help Kiev in the situation of a pandemic, ensuring a balance of payments and supporting the budget of Ukraine.
At the same time, Ukrainian media reported back in May that the IMF memorandum on the allocation of funds to Ukraine, which the Cabinet of Ministers did not make public, speaks of a number of conditions under which Kiev will receive funding.
Among them were an increase in the tax burden on business and the population and the abolition of liberalization of fiscal legislation, media reported.
In addition to the new loan tranche from the IMF, Kiev also received assistance from the World Bank. The organization decided to allocate $ 350 million to restore the Ukrainian economy after the pandemic.
One of the main goals of this tranche was called the continuation of the implementation of land reform, in the framework of which it is planned to gradually remove restrictions on the purchase of state agricultural land for all categories of investors.
Land reform has become one of the most unpopular in Ukraine in recent years - large-scale protests and opposition parties opposed the “opening” of the state land market for foreign investors.
Despite the public outcry, Vladimir Zelensky in late April signed Law No. 552-IX on the introduction of a land market in the country.
Andrei Suzdaltsev recalled that Zelensky promised to create the prerequisites for a large influx of investment in the country, to carry out economic reforms, and to create conditions for the development of new equipment and technologies.
“However, this is still not and will not be, since the Zelensky administration is not trying to find a way to improve the country's economy, but is just having fun, doing PR,” the political scientist noted.
According to the expert, not least investors do not want to invest in the Ukrainian economy because of its appeals to its own martial law.
"The model of Ukraine, which Poroshenko chose while in power and continues to be carried out by Zelensky, is designed so that no one wants to invest in the country, because it constantly declares that it is fighting," said Andrei Suzdaltsev.
High expectations
Despite the assistance provided by international organizations, the Ukrainian authorities continue to increase the tariff burden on the population. So, from August 1, 2020, Ukraine will increase tariffs for gas and electricity.
Despite the fact that the cost of gas has decreased by 6% since June, due to the formula for calculating the price, which includes cost and transportation, fuel will become more expensive in settlements with a low population density. The Korrespondent publication reports that at least 500 thousand citizens of Ukraine will also pay more for gas due to the lack of meters.
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The tariff for electric power transmission services and dispatching services of NEC Ukrenergo will also increase. The company decided to raise tariffs to pay off debts to electricity producers, the publication said.
Such an economic situation will negatively affect the situation of the administration of Vladimir Zelensky, experts say.
“The population is experiencing tremendous disappointment. Citizens of Ukraine, who voted for Zelensky, hoped that all problems would be resolved. But the miracle never happened, so the popularity of Zelensky and his team began to decline, ”said Suzdaltsev.
The population’s perception of the economic situation in the country, reflected in the opinion poll, is quite adequate to the situation that Ukraine is currently experiencing, Denis Denisov, director of the Institute for Peace Initiatives and Conflictology, said in an interview with RT.
“Before Zelensky came to power, Ukrainian society had high expectations that all problems in the country would be resolved. Today, there is a process of disappointment in the actions and policies pursued by the president. It also affects the perception of the general situation both in the country and, in particular, in the economy. A pandemic only exacerbates the situation, ”the political scientist explained.
Over the course of six months, the rating of the current president of Ukraine has been reduced, which is natural, based on the fact that he came to power on clearly overstated public expectations, Denisov added.
“Naturally, the economic problems of the state and the fact that the situation is getting worse will negatively affect the level of Zelensky’s rating,” the expert concluded.