Ukraine approves dramatic measures to stop coronavirus spread

Ukraine’s cabinet and parliament took dramatic measures
on Mar. 16 to prevent the spread of the COVID-19 disease caused by the
coronavirus. The cabinet approved a resolution prohibiting gatherings of more
than 10 people as of Mar. 17, including gathering at cafes and restaurants
(which were left allowed to cook and deliver food), shopping malls, fitness
clubs and cultural centers. The cabinet also forbid railway, air and bus
transit between cities and regions as of noon Mar. 18. The underground metro
systems of Kyiv, Kharkiv and Dnipro were ordered closed between Mar. 17 and
Apr. 3. Kharkiv Mayor Hennadiy Kernes continued to defy government orders,
keeping open the metro, schools and entertainment centers.

Ukraine’s parliament approved at its Mar. 17 special
session legislative amendments aimed at preventing the emergence and spread of
the COVID-19 disease. They mostly introduced punitive measures for the
violation of government-imposed quarantines, anti-epidemic rules and norms and
government rulings on the infection. It also removes taxes and customs duties
from imports of medical supplies to cope with the disease. Meanwhile, the
parliamentary finances committee endorsed a bill to cancel the single social
tax imposed on individual entrepreneurs until the end of April, as well as the
tax on commercial real estate and land.

Ukrainian President Zelensky gathered on Mar. 16
Ukraine’s leading businessmen for a summit at the President’s Office to ask for
their support in dealing with the coronavirus. “Business is supposed to be
socially responsible in difficult situations for the state,” Zelensky said in a
statement posted on the president’s website. “Ukrainians are supposed to feel
safe when they turn to state hospitals. And I insist that you help now. Ukraine
doesn’t have a critical situation now, and we hope that we can emerge from this
period with dignity, having preserved their health and lives.” Among those
attending were Privat Group partner Ihor Kolomoisky (estimated wealth USD 2.6
bln), SCM Holdings Owner Rinat Akhmetov (USD 8 bln), DCH Holding President
Oleksandr Yaroslavsky (USD 680 mln), and Kernel Group Board Chairman Andrii
Verevskyi (USD 1.0 bln), the pravda.com.ua news site said. Wealth estimates
were drawn from the annual focus.ua survey.

In a televised address, President Zelensky ordered
state bodies and parliament to continue working. Instead of holding standard
sessions, MPs will work in committees until at least Apr. 3 (with the exception
of today’s special session). The prohibitions on public gatherings, while
extension of parliament’s work, drew accusations from the pro-Western
opposition that the president is planning to approve unpopular political
measures, including the launch of the farmland market and concessions to Russia
on Donbas.

As of noon Mar. 17, one person died from COVID-19 in
Ukraine, while seven have been infected, according to the Center for Public
Health in Ukraine. Two infections were confirmed in the capital of Kyiv on Mar.
16. As of the same morning, 11 Ukrainian citizens were infected while abroad,
one of whom died in Italy. Two more Ukrainian citizens were reported to have
been infected in Poland later that day.

Zenon Zawada: We expect
the government’s measures will be effective in limiting the spread of the coronavirus
in Ukraine, which remains fairly well contained at this point. We also expect
life in Ukraine will return to normal at the same pace as in Europe.

Zelensky’s public support will be bolstered if Ukraine
emerges from this crisis relatively unscathed. It makes sense for him to use
this crisis to advance unpopular measures in parliament, particularly if the
farmland market is one of the few remaining IMF requirements for a loan
program, which is desperately needed. At least, Zelensky isn’t likely to allow
the virus to stop his efforts to secure the IMF loan.