This is a curated list of the most important economic news in Ukraine for the past week.
Summer is here but for real this time. Yesterday was the hottest day in Kyiv in almost a century, and today the temperature managed to sneak all the way up to 35 degrees. But while the temperature drastically raises the activity on the beaches, the Summer also means that politicians, company managers and other decision makers are starting to have their holidays. In Denmark as per tradition, we are talking about serving pork in public institutions as we do every summer.
In Ukraine, however, not much is going on. Still, some of what did happen in the past week was rather monumental. For starters, the National Bank of Ukraine has again crept into the spotlights twice this week.
First, a significant and unpredicted rise in inflation was recorded. Against what most experts believed, the NBU did not increase the key interest rate which is a common tool to stop increases in inflation. The inflation rate in Ukraine has increased to 9.5 percent in annual terms, almost double last year’s inflation rate of 5 percent.
Ukraine Nu interviewed the CEO of SEB, Kristian Andersson, this week about this exact topic. In the interview, he also touches upon the ongoing controversy in NBU regarding the governor and management of NBU. Speaking of which – one of the last board members from the old administration that served under former governor Yakiv Smolii is decimated, as Dmitry Sogolub’s contract was not extended today. Instead, he goes to work for the IMF.
IMF representative leaves
The Swedish representative of IMF in Ukraine, Goesta Ljungman, is leaving his post after four years. The relationship between IMF and Ukraine is strained. IMF is withholding payments because Ukraine is not living up to the agreements, according to the IMF. In a big interview with Kyiv Post, he said the following about Ukraine:
“Time and again, potential investors are concerned about rule of law, property rights, corruption, and overreach by government agencies,” says Ljungman, “The dominance of oligarchs or business groups, that’s a deterrent to investment… when there is dominance, that starts to impede competition. The first course in economics is that competition generates the best outcome. It stimulates productivity and innovation and gives consumers the lowest prices and best products.”
Speaking of Sweden (In a way), Kyiv Post had a large focus on Sweden this past week with interviews with the ambassador, IKEA and others.
Merkel and Zelensky
Staying in the sphere of international cooperation, the Ukrainian president Volodimir Zelensky and the German chancellor Angela Merkel had a phone conversation this week. They did agree to visit each other during the summer to discuss a variety of issues. Angela Merkel will also help mark the 30th year anniversary of Ukrainian independence this August.
Good news for the farmers
Nikolay Gorbachov, the president of the Ukrainian Grain Association, has predicted a record harvest of grains, oilseeds and beans of 100 tons total. It even beats the harvest of 2019-2020, which was in itself a strong harvest.
“What I can tell you about Ukraine is the conditions are just perfect,” Gorbachov said on the International Grains Council’s Grain Conference, where he predicted a 22 percent rise in corn harvest, 20 percent rise in wheat, 28 percent rise in sunflower seeds and no change in the canola harvest.
Speaking of harvesting and farming and grains, it seems relevant to mention that in exactly one week, the land reform is due. The land reform is the first step in introducing a free market for the sales of
A little bit of tourism
For the people out there with tourist aspirations in Kyiv, there are good news. The Mariinsky Palace is opening again after 12 years of renovations. Located right next to the Verkhovna Rada and – obviously – Mariinsky Park, anyone with time to spare could spend a good afternoon there and in the park. From Mariinsky Park there is a nice walking path going next to Parkovy Expo Center and through the forest to the Arch of Nations.
The path is going on the Eastern side of a hill with a good view over the left bank part of Kyiv, and followed to the end it will lead you right to the top of Andriivsky Descent in Podil. On the top of this street you find St. Andrews Church and the famous restaurant Kanapa. Further down the street you find the Bulgakov Museum and the Museum of One Street before landing on Kontraktova Ploshad.
Mariinsky Park is located in walking distance to Kreshatyk, Maidan Nezaleshnosti and the Arsenalna metro stops.
Also in relation to tourism, but then again not at all: The Ministry of Defence is now ready to auction off three hotels. Among them is one in Kyiv and one in Lviv. The Ministry of Defense of Ukraine is planning to transfer three hotels to the State Property Fund in the near future as a part of the ongoing privatization process, where state companies are being sold off to stave off corruption and unnecessary financial losses for the Ukrainian state.
Further sanctions against Belarus
The European Union has decided to increase the pressure of sanctions against the Belarusian leadership. Lately, Ukraine has been following and joining the European sanctions, but it remains to be seen if it will be the case in this package of sanctions as well.