THE IMPACT OF COVID-19 ON THE ECONOMIC DEVELOPMENT OF SMALL AND MEDIUM-SIZED BUSINESS IN UKRAINE

Abstract

The impact of the COVID-19 pandemic on European and U.S. economies is highlighted in the article, namely it is presented statistics on the GDP level and the development of a global economy. Ukraine is also an exporter of primary commodities, such as metals, and the price for them is likely to fall significantly due to falling demand in world markets. The price of copper has already fallen by 16 percent in the one month alone. Prices for iron and steel are likely to have the same trend. The crisis of 2009, when the fall in metal prices reached 40 percent, led to a 15 percent decrease in Ukraine’s GDP. However, the impact of COVID-19 should be expected to be less, as decline in prices for other commodities, such as food and agricultural products, are expected to be smaller and a serious fall in oil prices will have a positive effect on the competitiveness of Ukrainian exports. The authors consider the top management positions of the well-known international companies on the COVID-19 impact on the functioning of the companies. The immediate measures of government support for enterprises and organizations in Europe and the USA in connection with the COVID-19 pandemic are analyzed. The impact of the COVID-19 on the activity of some sectors of the economy of Ukraine is disclosed. The further development forecasts for small and medium-sized enterprises in Ukraine of leading scientists and economists after the pandemic are given. In order to prevent the negative scenario , governments are announcing aid packages aimed at supporting the financial markets, businesses and the general public. Ukraine should use both monetary and fiscal instruments in the assistance package. Unlike most countries, the National Bank of Ukraine has the opportunity to reduce the discount rate, which is currently 10%. The government must support the economy with all available resources , even at the expense of Ukraine’s national debt. The immediate priority is, of course, adequate funding for the healthcare system so that it is ready for this unprecedented challenge. The authors propose their own vision of the impact of the COVID-19 pandemic on the small and medium business development.