Foto: Gerd Altmann /

This is a curated list of the biggest economic news in Ukraine for the past week.

Last week, Ukraine Nu went semi prophetical and wrote about COVID-19 making a return. With a sharp rise in cases, we argued, new restrictions could be coming. Unfortunately, it looks like we were right at the time. The Ukrainian Health Minister Viktor Liashko is considering implementing a yellow threat level around Ukraine due to the increased number of COVID-19 cases around the country.

“Today we had several government meetings and conferences, which clearly show that Ukraine has already exceeded the indicators that can switch the country from a green level of epidemic threat to a yellow one. We have filed a motion from the Ministry of Health to the Cabinet, which will consider our appeal, and, most likely, next Monday (the 14th of September) Ukraine will move to the yellow level of epidemic threat. Additional restrictions will be set, provided for the yellow level and related primarily to mass events,” Liashko said.

Despite the warning of a limited lockdown on Monday, Liashko said that Ukraine isn’t considering a large lockdown at this point. Switching to a yellow threat level only means that there will be restrictions in place for mass events, while schools can continue as normal as long as 80 percent of the staff is vaccinated. However, Liashko doesn’t rule out a more harsh lockdown in the future.

Gas, gas, gas

Reading Ukrainian media for the past week makes it hard to imagine, what they were writing about before COVID-19. However, a topic always popular is anything related to gas. This week has been no exception. First and foremost, Nord Stream 2 is now officially done. Two days ago, the last pipe was welded.

This means two things: First and foremost, it is a nightmare for Ukraine that has been trying to stop this project since day one. The country stands to lose billions of dollars due to lost gas transit fees, that they are currently charging Russia.

Secondly, Russia is ready to send gas to Europe, though Europe seems not to be ready for Russian gas from Nord Stream 2. Nord Stream 2 might be complete but the political problems aren’t over. According to Interfax-Ukraine quoting Frankfurter Allgemeine Zeitung, Gazprom might be forced the sell off the Nord Stream 2 pipeline, if it is to comply with the European Union’s regulations.

“Nord Stream 2 had already tentatively submitted a request to the Federal Network Agency in June for “Certification as an independent transport operator. It is intended to comply with the separation order by promptly separating the operation of the pipeline from the parent company in terms of accounting as well.” Interfax-Ukraine quoted Frankfurte Allgemeine.

Also, a German court ruling against the Nord Stream 2 project on a matter of monopoly regulations says that Gazprom would only be able to use half the capacity of the Nord Stream 2 pipeline. As of now, the Russian energy giant Gazprom is the only ones who send gas through the Nord Stream 2 pipeline. By the looks of it, they will not be allowed to fully utilize this, but the court decision is not necessarily final and might be overturned.

Meanwhile, still in the realm of gas, Qatar is set to cooperate with Ukraine about gas. Ukraine and Qatar decided during a visit from the Qatari minister of Finance to cooperate in the energy sector and they signed a protocol to enhance cooperation in energy efficiency, renewable energy and gas.

“LNG is one of the alternative directions of natural gas supply to Ukraine, which can ensure the diversification of energy supplies. This will help strengthen Ukraine’s energy security after 2024,” said Ukraine’s Deputy Energy Minister Maksym Nemchynov, according to Ukrinform.

“The geopolitical situation and the reduction of transit volumes make us look for new areas of trade and cooperation to ensure the loading of our own gas transmission system. That is why cooperation with the State of Qatar in terms of LNG supplies is an important priority for us,” Nemchynov added.

Enter crypto

The Ukrainian parliament has approved a bill making cryptocurrencies and other digital assets legal in the country. Minister of Digital Transformation Mykhailo Fedorov said that the daily turnover of virtual assets in Ukraine already stands at around 1 billion UAH but that everything is hiding in the shadows, which means that nobody pays any taxes on transactions.

“Thanks to the bill, this will be settled. Favorable conditions will be created that will allow companies to register in Ukraine and not abroad. The budget will receive taxes, and entrepreneurs feel protected. Only a few countries in the world have legalized crypto assets – Germany, Luxembourg, and Singapore. Ukraine will be one of them,” said Fedorov.

First of all, this is not entirely true. Recently, El Salvador made Bitcoin, the king of cryptocurrencies, legal tender in the country, meaning it should be accepted as payment across the country, as reported by many international outlets including the New York Times. The list of countries changing their attitudes toward cryptocurrencies is growing, and actually using Bitcoin is legal in most European and both North and South American countries.

Secondly, taxation and cryptocurrencies are not necessarily very good friends. One of the founding principles of Bitcoin was a dream of “a purely peer-to-peer version of electronic cash would (that) allow online payments to be sent directly from one party to another without going through a financial institution.”

Naturally, digital cash comes with the privacy benefits of regular cash, but also the same challenges to authorities, including tracking payments and taxing them.

Privatizations will come

One of the Ukrainian government’s tools to fight corruption and inefficiency is privatization of the many state-owned companies, which are running with a deficit. The Ukrainian government has previously been successful in selling several companies such as Dnipro Hotel in downtown Kyiv, but the process slowed down last year due to Covid-19.

The Ukrainian government is now ready to kickstart the privatization process, says Deputy Head of the President’s Office Kyrylo Tymoshenko. He believes that the state budget can get a four-fold increase in receipts from privatizations this year, compared to 2020.

“In 2018, the growth of revenues from privatization amounted to 1.2%, in 2019 – 3.1%, in 2020 it was 350%. But we do not stop there, because the plans for budget receipts from privatization this 2021 are to increase receipts by another four times,” Tymoshenko said.

Climate change is a threat to farmers

The summers in Ukraine are getting hotter and hotter and it threatens the Ukrainian agricultural sectors. They point out that it isn’t uncommon to see temperatures higher the 40 degrees Celsius in southern Ukraine anymore and that it is a problem for the Ukrainian agricultural sector, which stands for around 10 percent of the country’s GDP and employs 22 percent of the population.

“Water unavailability and heat stress during periods of increased temperature already impact the yield of the crops,” said Mykola Shlapak, a Kherson-based independent consultant on climate change mitigation, to BMB Ukraine, according to bne IntelliNews.

Shlapak pointed out that climate change is resulting in more extreme weather in general, which also results in heavy rainfall.

Good news from Tokyo!

Ukraine won a total of 98 medals at the Tokyo 2020 Paralympic Games, which recently ended. Ukraine got 24 gold medals, which is sixth best of all nations. It is also much better than their gold harvest at the regular Olympic Games.

“For a person with a disability, winning in sports means winning in life,” said Valery Sushkevych, president of the National Paralympic Committee of Ukraine in Boryspil airport, when the Ukrainian athletes returned home after the Tokyo 2020 Paralympic Games.

The Ukrainian success was especially great in swimming, where Ukraine won 43 medals, 14 gold. In total, Ukraine won 98 medals, 24 gold, 47 silver and 37 bronze, which was fifth best of all countries. Only China (96), Great Britain (41), the United States (37), Russia (36) and the Netherlands (25) won more gold medals than Ukraine.

Visit old Ukraine

UkraineNu visited the Pyrohovo Museum of Folk Architecture and Rural Life just south of Kyiv. At the museum, which is more a complex of old buildings, curators have gathered 300 significant buildings and monuments from all regions of Ukraine, the oldest of which dates back to a village house from 1587.

Read more here.