The world is waiting for a vaccine against the coronavirus, develops herd immunity, and at the same time is looking for ways out of the economic crisis, looking for new recipes for economic health.
Due to the epidemic and quarantine in the world, a global decline in activity. The head of the International Monetary Fund Kristalina Georgieva bluntly stated that the coronavirus epidemic would have the worst economic consequences since the Great Depression of 1929. The forecast for the fall of the world economy in 2020 is at least 3%. The forecast for Ukraine is even more depressing – up to 8%.
The most difficult thing now is to overcome uncertainty
No one has ready-made solutions, only forecasts and scenarios … Economists and business practitioners state aloud that the recession will be very deep. And protracted. After all, the world for the first time in the last 100 years has faced a crisis of this nature and character. A crisis in which entire industries may disappear.
Uncertainty has already gone beyond the economic sphere. She has become a social phenomenon. The uncertainty is so strong that no one can handle it alone. People are held back by fear. To overcome the numbness and move on, you need to find points of support.
The first step in overcoming is to accept the new reality (both the epidemic and the deep economic recession) and start working in it. We have launched a huge work to support the state in the fight against COVID-19. We did our best to keep our employees safe and our enterprises to work without interruption (and everywhere we put stability of work and care for employees at the head of decisions). We came up with an initiative to start work on the country’s economic strategy in the context of the global crisis – and this initiative was supported by other businesses and the government.
I am sure that both in the world and in Ukraine the main factor in overcoming uncertainty, the main driver of growth , the main fulcrum will be business. Moreover, it is the industrial business. It is from the real sector of the economy that new certainty will grow. Following the industry, small and medium-sized businesses, services, and the creative economy will recover.
Why exactly industrial business will give certainty? For the economy to recover, it is necessary to rely on the most stable ones. It is now more clear than ever that the national economy will survive if metallurgy, energy and the agricultural sector survive. They are the basis of the Ukrainian economic recovery. As in the fight against the COVID-19 disease, doctors were at the forefront (and they were supported by business and patrons), so in the fight against poverty, metallurgists, miners, energy workers, agrarians, machine builders come to the fore.
Recovery economy starts with industry.
Our recovery plan for Ukraine is to boost industry to give small and medium-sized businesses a chance to recover. And according to this plan we are going. We believe in him. We are investing in it. What exactly are we doing?
On the one hand, we continue to work, do business “as usual”, which is almost a feat at the moment. Our enterprises have been transferred to a special regime, they have introduced new standards of hygiene and safety. On the other hand, we are doing a lot of work to preserve liquidity in order to be able to pay our employees salaries, and our contractors – to pay for their work. But the most important thing is that we continue to invest in our key projects, primarily in industrial businesses.
The experience of China shows that with the right government policy, it is most effective to start with this – the industry has almost recovered, and the sector services barely crossed the 40% mark from the pre-crisis level. But the growth processes have been launched and their synchronization is only a matter of time. Basic industries – like locomotives – pull the rest with them. We are vitally interested in this scenario. After all, SCM is not only about heavy industry and energy. It also includes banking, insurance, telecommunications and other businesses. We are in the same boat with the whole country.
SCM business is a large, creative, sustainable business that provides jobs and salaries for employees, fills the country’s budget, and enables small and medium-sized businesses to develop. This makes SCM an important element of the country’s economic foundation. And the more stable this foundation, the faster the economy as a whole will recover.
Why is this so? During periods of turmoil, the economic truth is revealed – the financial support of the state is only those businesses that honestly pay salaries and taxes. Especially for Ukraine, where a significant share of the economy is in the shadows. Rinat Akhmetov’s business is the country’s main legal business. And the largest private taxpayer. Taxes are the only source of money in the country’s budget. Our taxes are salaries, pensions, roads, education, defense and medicine.
How to speed up the economic recovery
It won’t take a couple of weeks or even a couple of months. To make it happen as quickly as possible