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For Ukrainian President Volodymyr Zelensky’s administration, the coronavirus pandemic has come at the worst time. The country’s economic downturn and political turmoil had already impacted the president’s ratings, which were record-high not so long ago. The pandemic, which has shaken the foundations of far more stable countries, could have very serious consequences for Zelensky and his team.
Although there are currently not many confirmed cases of coronavirus in Ukraine, the authorities there did not hesitate to make what Zelensky described as “unpopular and harsh decisions” to try to tackle the virus. The president declared a national quarantine, closed the borders to foreign nationals, closed the Kiev metro, and—in areas where cases of the virus have been recorded—declared a state of emergency.
It’s clear that the president understands the inevitability of closing down the country, and is trying to do so before the number of coronavirus deaths sparks panic and unrest. Many in the country believe that Zelensky’s actions are irrational and that the economic damage from quarantine could be too great, but for Zelensky, humanitarian issues usually outweigh economic losses.
It’s true that the president’s good intentions sometimes backfire as a result of poor communication with society and administrative chaos. In February, the arrival of Ukrainians evacuated from the Chinese epicenter of the virus prompted riots. Despite the relatively high ratings of Zelensky himself, Ukrainians traditionally have no faith whatsoever in the actions of the authorities. In extreme circumstances, this lack of trust rapidly takes on radical forms.
For the embattled Ukrainian economy, the quarantine measures will be a serious blow. Ukraine’s coffers simply do not have the sort of resources that wealthy countries are allocating to support businesses. To compensate small and medium-sized businesses for their losses, Zelensky has announced repayment holidays and tax breaks. The last time Ukraine resorted to such measures was in 2014, at the height of the war.
Zelensky has ordered the Finance Ministry to ask the IMF for help, while he himself held a meeting with the country’s big business leaders and oligarchs—including his longtime associate Ihor Kolomoisky—where he called on them to support the state in its time of need: to the tune of 12–13 billion hryvnias ($430–465 million).
It later emerged that Zelensky had tasked each of the oligarchs with overseeing a specific region where they have assets: Rinat Akhmetov will be responsible for the Donbas and western Ukraine, Kolomoisky for Zaporizhia, Victor Pinchuk for Dnipropetrovsk, and so on. This strategy is also reminiscent of 2014, when acting president Oleksandr Turchynov appointed major businessmen the governors of the country’s eastern regions and tasked them with funding their protection from separatists out of their own pocket.
The global economic problems caused by the pandemic will also damage the Ukrainian economy. Money will be withdrawn from emerging markets, prices and demand for exports will fall, and it will be impossible to raise investment for at least the next six months, which creates the risk of a default.
The pandemic has also impacted on Ukrainian labor migrants in Europe, who have long been one of the Ukrainian economy’s main sources of revenue. Last year, they sent money transfers worth about $12 billion back to Ukraine, according to the Economic Development Ministry.
Now, as European countries close their borders and those migrants lose their jobs amid the quarantine, they are hurrying home, which could have a major impact on the socioeconomic situation in western Ukraine.
Restricting access to the EU labor market could lead to a growth in Euroskepticism in Ukrainian society. People there are watching with trepidation as national egoism triumphs over European solidarity in the fight against the virus. The apparent indifference of EU officials to the problems faced by Italy and Spain, and the sight of each EU country waging its own battle against the coronavirus, is pouring cold water on Ukrainians’ ambition to join the EU. In the long run, this could strengthen the pro-Russia cause in Ukrainian politics, though a lot will depend on how effectively Russia manages to deal with the epidemic.
The coronavirus pandemic will significantly alter the global agenda. Ukraine, which has gotten used to its problems being among the world community’s priorities, must be prepared to see the issues of Crimea and Donbas take a back seat amid everything else that is happening.
First and foremost, Kiev will have to reach an understanding with Moscow, which will not fail to turn the situation to its advantage. The signing of an agreement by Ukraine and Russia on setting up an advisory group that includes representatives of Ukraine’s breakaway territories has already angered the “patriotic” opposition, who have accused Zelensky of legalizing the separatists.
For now, the quarantine measures in place have prevented massive protests from being held, but they will erupt at the first opportunity. Even twenty-eight parliamentary deputies from Zelensky’s own Servant of the People party signed a letter protesting the creation of the working group.
A critical mass of problems is emerging that looks increasingly insurmountable for Zelensky’s team of idealists and dilettantes. It’s getting harder and harder for the president to deal with these new challenges, which have defeated some of his far more experienced European colleagues and prompted comparisons to the trials of World War II.
Under these circumstances, the chaos caused by the pandemic combined with Ukraine’s existing political problems could sharpen the appetite for authoritarianism in Ukrainian society. The influence of the security services, who are responsible for implementing the quarantine measures, is clearly growing, including that of Interior Minister Arsen Avakov. He is already calling for a nationwide state of emergency to be declared, and has proposed an ambitious “anti-crisis plan” that includes increasing the budget deficit and restructuring foreign debt, which goes far beyond his ministerial authority.
The apparent success of China and its complete mobilization to fight and control the virus compared to the helplessness of democratic countries will set a global trend further down the road. The previous crisis of democracy and anti-elite rebellion gave Ukraine President Zelensky. What could a possible worldwide swing toward isolationism and a firm hand have in store for the country?
This material is part of the “Russia-EU: Promoting Informed Dialogue” project, supported by the EU Delegation to Russia.
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