President Vladimir Zelensky has submitted to Parliament a bill to raise the monthly minimum wage to 5 thousand hryvnia, the Ministry of economic development estimated the fall of Ukraine’s GDP in the first half of 6.5%, while Ukrainian agrarians have harvested half of the acreage.
This week the world was shocked with the news of the explosion stored in the warehouse in the port of the capital of Lebanon, Beirut stocks of ammonium nitrate, which has been dubbed the most powerful non-nuclear explosion in history.
After this high-profile tragedy with many human casualties and considerable economic damage, Prime Minister Denis Shmyhal instructed to check the safety of storage of ammonium nitrate by business entities of Ukraine. The country began a large-scale audit, including seaports and places of storage of chemical materials.
Other important sectors of the economy news this week’s attention was drawn to the initiative of President Vladimir Zelensky to amend the budget to increase from September 1 the monthly minimum wage to 5 thousand hryvnias from the current 4723 hryvnia.
The head of state lodged a bill in Parliament, which is now in summer recess.
“It is expected that the Verkhovna Rada will consider and adopt changes in the main financial document until the end of August at an extraordinary session that would be convened for consideration of the bill”, – reported in the Office of the President.
The main source of financing the increase of the minimal wage will be, first of all, the savings on debt service.
It is worth noting that earlier representatives of business spoke against raising the minimum wage during the crisis period for Ukraine, as, in their opinion, it could trigger the growth of wages “in envelopes”.
“The increase in the load on the wage Fund by increasing the minimum wage in Ukraine could lead to growth of the sector of “shadow” wages”, according to the European Business Association.
Also this week, the President signed the law on the functioning of the electronic taxpayer Cabinet and the simplification of accounting for natural persons-entrepreneurs. Now Popi, may wish to keep records of their business in any convenient form – paper or electronic – showing the amount of income per month.
Another innovation for business this week was the launch of the software of payment transactions recorders (PPO) in mobile – free mobile application, developed by the internal revenue service.
According to the Ministry of Finance, in the first week of the app entrepreneurs registered more than 26 thousand of the cash register and gave more than 630 thousand receipts with it.
The fall in GDP
In the first week of August, the Ministry of economic development, trade and agriculture published a survey of economic activity for the first half of 2020, and assessed the state of Ukraine’s economy – improved slightly in comparison with the previous review.
“In January-June reduction in foreign economic activity amounted to 7.7% and, respectively, the decline in GDP estimated by the economy rate of 6.5%,” – said in the review.
The Ministry has estimated the fall of Ukraine’s GDP in the second quarter of the year at 11%, slightly less than previously expected – at the level of 14%.
The review notes that the dynamics of types of economic activity suggests that the economy of Ukraine has passed the peak of the maximum negative effect from the strict anti-epidemic measures within the country and abroad, which was felt in April and may.
“Currently, against the background of easing of the quarantine, the economy gradually starts to recover”, – ascertain in the Ministry of economy.
In addition, this week the national Bank reported that international reserves of the country on 1 August was 28,802 billion, one percent higher than the previous month.
Foreign exchange earnings during the previous month amounted to 1.75 billion, while the servicing and repayment of public debt in foreign currency was sent $ 1.5 billion. Here it is worth Recalling the issue of Ukraine in late July, the 12-year Eurobonds on 2 billion dollars. And that on Tuesday the Ministry of Finance held t-bills auction and attracted to the state budget more than 10 billion hryvnia.
Against the background of these news in the first week of August the exchange rate of hryvnia to the dollar remained more or less stable. The maximum hryvnia weakened to 27.82 UAH/USD. at the official rate, but on Friday came back down to the beginning of the week – of 27.67 UAH/USD. National Bank on Monday, August 10, has set the official rate of hryvnia to the dollar at the level of 27.65 UAH/USD., that is, the hryvnia strengthened 3 kopecks in comparison with the previous indicator.
Peak of harvest
Ukrainian farmers at a solid pace, continue the harvesting campaign and this week has threshed more than seven million hectares, or about half of the acreage under crops. In General, agrarians harvested 27 million tons of grain, of which wheat – 18.3 million tonnes, barley – 6.9 million tonnes, peas – almost half a million tons.
As regards oilseeds, it is nearing the end of harvesting rapeseed, one of the main export crops, which has already produced over 1.8 million tons.
This week the experts of the Ukrainian grain Association (UGA) was pleased with the optimistic forecast that the harvest of grains and oilseeds in our country at the end of the season may lead to an unprecedented one hundred million tons.
“The increase in the forecast of gross harvest and export was due to the improvement of the forecast of the harvest of barley and corn crop which may set a new absolute record for Ukraine”, – the experts say UGA.
By the way, despite improved weather conditions and condition of fields, the profile of the Ministry of economy did not revise its forecast for grain and oilseed, continued to assess the harvest this year at 88 million tonnes.
At the same time, Ukrainian farmers are far behind in the export of grain from the pace of last year. At the end of the week of August 7, Ukraine sold to foreign markets 3.2 million tons of grain, which is 1.2 million tons less than at the same date in 2019.
Meanwhile, farmers do not slow down the pace of the harvesting campaign and will soon begin to harvest corn, which will depend on whether this year set a new record. Weather in the coming days promises to be hot and no precipitation in most regions of the country.
Next week, the state statistics service will publish the fresh data on inflation and foreign trade. And the Ukrainians will continue to observe the distribution of settlements on the “green”, “orange” and “red” quarantine zone for which so actively engaged the government since the beginning of August.
The Verkhovna Rada