The coronavirus is about to hit Ukraine, the poorest country in Europe, and it may derail the economy and the government. Most forecasts predict a recession, and best-case scenarios anticipate an economic contraction of 5 to 10 percent, inflation, and half a million unemployed.
The government, led by political showman Volodymyr Zelenskyy, just turned over on March 4. Markets were decidedly unimpressed. After the reshuffle, the yield on short Ukrainian Eurobonds skyrocketed from 3.5 percent to 7.75 percent per year. The Ukrainian hryvnia is now falling, and the international financial market is already closed to Ukraine. The country needs nearly 10 billion dollars from the International Monetary Fund, but it’s unclear whether Ukraine’s parliament will comply with the bank’s demands.
The writing is on the wall. Ukraine is headed for a major catastrophe.
In southern Ukraine, hospitals have 130 ventilators for four million people. Forty are currently in use in ICUs, which means that only seventy are available for when COVID-19 arrives in earnest.