It’s a bad time to be a Ukrainian billionaire — relatively speaking, at least.
According to the latest Forbes ranking of the world’s richest people, Ukraine’s billionaires have seen their wealth plunge this year compared to last. Moreover, the number of Ukrainians on the list has declined from seven in 2019 to six today.
But those Ukrainians who remain have lost a lot. At the top of the list of Ukrainians is oligarch Rinat Akhmetov, the owner of the Metinvest steel and mining company, with a net worth of $2.4 billion. Despite that, he lost roughly $3.6 billion and fell 600 positions in the ranking, dropping to 875th place. And it happened quickly: In October, Akhmetov’s assets were worth $5.7 billion.
His business partner, steel tycoon Vadym Novinsky, is no longer on the list.
Metal ore tycoon Kostyantyn Zhevaho has lost $500 million since last year and his assets are now worth $1 billion.
The remaining Ukrainians are:
1. Rinat Akhmetov, worth $3.6 billion, 875th place in ranking
2. Victor Pinchuk, worth $1.3 billion, 1,670th place in ranking
3. Hennadii Boholyubov, worth $1.2 billion, 1,816th place in ranking
4. Yuriy Kosiuk, worth $1.1 billion, 1,966th place in ranking
5. Konstantin Zhevago, worth $1 billion, 1,991st place in ranking
6. Ihor Kolomoisky, worth $1 billion, 2,105th place in ranking
Weak steel prices have hit Ukraine’s steel producers hard, Konstantin Fastovets, head of research analytics at investment company Adamant Capital, told the Kyiv Post.
“Shareholder wealth is obviously affected,” he said.
Fastovets predicts that Metinvest will generate $500 million less in 2020 than in 2019, roughly a 50% drop year-on-year.
As a result of global lockdown measures to prevent the spread of COVID-19, since mid-March, steel prices have fallen sharply due to a drop in global demand. On March 12, Ukraine’s government announced the start of its own shutdown, a public health decision that severely affects the economy.
As of April 19, data shows that large businesses are suffering and have lost up to 25% of their profits. They are expected to dismiss nearly 25% of their staff.
The shutdown contributes to an already long-running crisis in the metallurgy. The industry, which accounts for about a third of Ukraine’s industrial production, was the first hit by the global slowdown in 2019. As a result, steel prices have fallen.
In 2018, the United States introduced a 25% duty on steel imports and a 10% duty on aluminum imports, which triggered economic protectionism around the world. The U.S. trade war with China and EU-imposed quotas for metallurgical products, intended to protect the European market, also affected the prices of steel.
Ukraine is particularly vulnerable in this respect. Mining and metallurgy account for 12-15% of its total gross domestic products. As of 2019, 350,000 people work mining, metallurgy and other related industries in Ukraine.
In an interview published on Metinvest’s website in January 2020, before the quarantine measures were introduced in Ukraine, company CEO Yuriy Ryzhenkov acknowledged the crisis.
“We are a cyclical industry and I believe we are already at the bottom or close to the bottom of the current cycle,” he said.
Other oligarchs and billionaires’ wealth seems unaffected.
Victor Pinchuk, the founder of EastOne, is worth $1.3 billion. Privat Group owners Gennadiy Bogolyubov, worth $1.2 billion, and controversial oligarch Ihor Kolomoysky, worth $1 billion, are also included in the list.
Yuriy Kosiuk, who owns Myronivsky Hliboproduct, Ukraine’s largest producer of poultry, has a net worth of $1.1 billion.