- Foreign Buyers Return to Ukraine Bond Market
- Kolomoyskiy Company Sues US Gov’t
- Diya Spreads Like Digital Wildfire
- EU Parliament Tells Ukraine to Reform
- Bills to Fast Track Privatization Go to Rada
Foreign purchases of Ukrainian government bonds are returning to their peak levels of late 2019, reported Dragon Capital. Over the last month, foreign purchases totaled $526 million, “close to peak monthly inflows of $560-610m in September and December 2019,” Dragon wrote. “Recent appreciation pressure on the hryvnia (+1.4% w-o-w) is likely to support interest in local bonds. We expect yields on medium-term hryvnia debt to remain close to current levels in the coming months unless an upsurge in foreign demand drives them lower.”
State-owned PrivatBank was the most profitable bank in Ukraine last year, recording $910 million in net profit. The next four most profitable banks were: Raiffeisen Bank Aval – $145 million; state-owned Oschadbank – $101 million; FUIB – $94 million; and OTP Bank – $62 million. The biggest loss was recorded by state-owned Ukreximbank – $200 million.
The net profit of all Ukrainian banks amounted to $1.475 billion last year, or 29% less than 2019, reports the National Bank of Ukraine. Out of 73 banks operating in Ukraine last year, 65 were profitable, reported the Central Bank. The former owners of PrivatBank, billionaires Ihor Kolomoyskiy and Hennadiy Boholyubov, are undertaking court actions to return ownership of the bank. It was nationalized in December 2016 after auditors found a $5.5 billion hole in its accounts.
Kolomoyskiy and Boholyubov, who are both under investigation by the FBI for money laundering, are suing the US Government for attempting to seize their Texas commercial building worth $23 million, RFE/RL reported in a 1,000 word article from Washington. They say the US government’s actions violate the sovereignty of Ukraine. Last week, Optima Ventures, a U.S. real-estate holding company controlled by the pair, informed a Florida court that it will file for arbitration against the United States in the World Bank’s International Center for Settlement of Investment Disputes.
Millions of Ukrainians signed up in the first year of the government’s Diya mobile app for digital services. As a result, the number of partner agencies and companies is expected to increase 10-fold this year, to 1,000, reported the Digital Transformation Ministry. Under the ‘State in the Smartphone’ program, users can store: a child’s birth certificate, a certificate of an internally displaced person, a digital tax number, digital internal and foreign passports, driver’s license, registration certificate and car insurance. Users can pay traffic fines. Last month, almost half a million Ukrainians applied for one-time, 8,000-hryvnia quarantine relief payments.
By the end of next month, Diya users will be able to change their registered places of residence, use electronic signatures, and interact with government for taxes, medical records and construction permitting. “In 2021, Ukraine will enter into what we term as ‘paperless mode,’” Mykhailo Fedorov, Digital Transformation Minister wrote in an Atlantic Council blog. “In other words, if a service is not available online, this means it is not available offline.”
This year, five years after the Ukraine-EU free trade agreement went into force, both sides “are ready to start the review of trade liberalization for goods,” Valdis Dombrovskis, the European Commission’s Vice President for Economy, said at a press conference in Brussels with Ukrainian Prime Minister Shmyhal. “This will be an important step towards further improving access to our respective markets,” Dombrovskis said. “We hope that this positive trend between Ukraine and the EU will also strengthen the role of the EU as a key trade partner for Ukraine.”
In a blunt resolution approved by 526 European Parliament members – three quarters of the total – the Euro Parliament criticizes Ukraine for weak progress on cleaning up the courts, for putting political pressure on the Central bank, for slow progress on bringing power plants up to EU standards, for profiteering attempts during the coronavirus attempts and for making “no visible” progress “in the de-oligarchisation of the country.” On reports of “attempts to purchase medical equipment at a disproportionately high price in the midst of a pandemic,” the parliamentarians “urge Ukraine to combat the pervasive nepotism and corruption that persist in its health sector, and especially in the Ministry of Health.”
Concorde Capital’s Yuri Svirko writes: “While the EP resolution will have no immediate effect on the EU-Ukraine relations, including the visa-free travel regime or further trade liberalization, it is still an early warning signal for Kyiv.”
Ukraine’s Anti-Corruption Prosecutor’s Office, or NABU, is investigating corruption reports surrounding the vaccine, Maksym Hryschusk, acting head of the unit told reporters. Separately, a civil society watchdog group, NABU Public Control Council, charged that talks were underway to buy China’s Sinovac Biotech vaccine at $3 a dose, “however, subsequently, the Minister of Health Maksym Stepanov manually stopped this process and instructed to start negotiations on the purchase” at $17.85 a dose. Stepanov has said that different companies charge different prices.
Before the Euro Parliament vote, Josep Borrell the Commission’s de facto foreign minister, warned: “Despite notable progress, widespread corruption continues to hamper Ukraine’s reform process. Its key institutions must have strong and independent leadership and the chance to do their work free of political, economic or other interference.” The speech, delivered by Dombrovskis, concluded: “We urge all reform-oriented political factions to come together and give a clear signal of Ukraine’s determination to make its reform path irreversible.”
Many of the Euro Parliament recommendations coincide with “10 Steps for Ukraine’s Economic Recovery and Growth in 2021,” a charter released by the American Chamber of Commerce in Ukraine.
To speed up privatization of Ukraine’s 3,500 state companies, Mikheil Saakashvili’s Office of Simple Solutions and Results has sent to the Rada a package of bills that would deprive courts of the power to freeze sales, to give local communities 30% of sales proceeds, and to channel all other sales proceeds to improving state services. By creating these incentives, Saakashvili argues in a Kyiv Post opinion piece, Ukraine will find the will to cut the state companies which cost the Treasury $6.1 billion a year. He wrote that Ukraine has 63 times more state companies than Poland and 76 times more than Sweden.
The EU and the WHO said that they will spend €40 million over the next three years to help Ukraine and five other former Soviet republics to roll out vaccinations against Covid-19. WHO Europe Director Hans Kluge said progress is slow in the EU. Vaccinations are taking place in only 29 out of the 37 countries in the European region. He said: “Today, 7.8 million people have completed their immunization series. That is equivalent to only 1.5% of the population of those 29 countries.” Ukraine hopes to start vaccinating this week.
- Electricity Brownouts Loom
- Power Plants Are Starved of Coal and Maintenance
- ’Carbon Curtain’ Could Come Between Ukraine and EU
With cold weather expected through the end of February, coal supplies are at dangerously low levels. DTEK Energy, responsible for 90% of Ukraine’s steam coal production, cut its coal production last year by almost 16% yoy, according to Energy Ministry data.
Concorde Capital’s Alexander Paraschiy wrote that the combination of prolonged cold weather and coal production cuts “has resulted in a risky situation in Ukraine’s energy sector.” He warns that: “Six power plants of DTEK Energy that are designed to burn hard steam coal have got coal stockpiles only enough to operate during 33 to 57 hours, based on Energy Ministry data.”
DTEK is tripling its coal imports this month to 450,000 tons, Maxim Timchenko, CEO of DTEK, Ukraine’s largest private power producer, told reporters yesterday. In addition to importing about 150,000 tons a month from Russia, DTEK will import coal from Poland and Kazakhstan. Timchenko said: “DTEK is producing as much coal as possible, and we are producing as much electricity as possible.”
11 DTEK plants were temporarily closed for emergency repairs, reports Ukrenergo, the state electricity distribution company. During the first week of February, sub-freezing temperatures pushed electricity usage to the highest level in six years, Andriy Gerus, chairman of the Rada Energy Committee said on his telegram channel. Timchenko said that his capital-starved company has not had the money to do regular maintenance on 50-year-old Soviet plants. He said: “If we do not have the money, we can’t pay for maintenance and repairs.”
“Financial genocide of power generating companies” threatens Ukraine with electricity brownouts as early as this month and blackouts next year, Timchenko said at a press conference. In the last 18 months, power companies have suffered almost $2 billion in financial losses due to unpaid renewable energy bills, a market liberalization law that created “profiteering” and musical chairs at the Energy Ministry. Five ministers in 18 months have meant constantly changing policies and a “lack of professionalism,” he said. “Strategy is changed by every single minister, by every decision of the Rada, by every decision of the regulator. It results in chaos.”
Without financial relief, he warned, Ukraine will suffer electricity shortages and may miss a 2023 deadline to join Europe’s power distribution system. “Ukraine’s integration into the European energy market will increase competition, reduce prices and improve the quality of services provided,” he said. To get there, the government must create “a professional management team capable of overseeing the development of the energy sector, the application of best practices from our European partners, the integration of the Ukrainian energy system into ENTSO-E, and the establishment of market approaches to pricing.”
To get its own house in order, DTEK Energy plans to swap its $1.67 billion debt for new Eurobonds by May, Timchenko said of the company’s bond and bank debt restructuring. “It will be a public instrument with a yield of 5% this year, and 7% starting next year until the end of 2027. It will take three months legally [to complete] this process.”
DTEK, Ukraine’s largest investor in renewables, plans to launch this year a pilot project for the production of “green” hydrogen and to build 1 MW energy storage capacity at its Zaporizhia thermal power plant site. In addition, the company plans to build in Mykolaiv Europe’s second largest onshore wind plant. The Tyligulska wind farm would have a capacity of 565 MW. Next year, DTEK plans to build three solar plants in Dnipropetrovsk region with a total capacity of 390 mw.
With the EU planning to invest €1 trillion to achieve carbon neutrality by 2050, a ‘carbon curtain’ of protective tariffs may grow up to protect the EU’s ‘clean’ products from competing products made from ‘dirty’ energy sources, such as coal or nuclear. “If others will not move in the same direction, we will have to protect the European Union against distortion of competition,” Frans Timmermans, the European Commission’s vice president for the European Green Deal, said last month. As the EU prepares a ‘carbon border policy’ Timmermans argued: “It’s a matter of survival of our industry. So, if others will not move in the same direction, we will have to protect the European Union against distortion of competition and against the risk of carbon leakage.”
“Carbon leakage” means ‘dirty’ industries relocating out of the EU to avoid carbon restrictions. Carbon border tariffs also are expected to supersede Ukraine’s Association Agreement with the EU. Under EU policies expected to be adopted next summer, new tariffs could be levied on Ukrainian steel, cement and even grain. The EU Green Deal could also end EBRD and European Investment Bank loans to companies judge ‘dirty’ for their emissions or use of ‘dirty’ energy.
Climate policy is “the biggest economic priority this year,” Taras Kachka, Ukraine’s Trade representative, wrote from Brussels on Facebook. “The success of our cooperation with the EU for decades will depend on how it is formed.” Addressing a public private debate over Ukraine’s National Economic Strategy, he warned: “This year, the European Union is actively working on how to influence climate change through import controls.”
“Shmyhal, German representatives of energy sector discuss European Green Deal,” Ukrinform, the state-owned news agency, headlined a story about a video conference with officials of Germany’s Federal Ministry for Economic Affairs and Energy. “We are prepared for the challenges facing Ukraine in the context of the green transition, the decarbonization of the economy,” Shmyhal said at the start of a meeting which was largely designed to win Germany aid and expertise to help Ukraine’s 61 coal mining towns make a transition to a post-coal economy.
- GDP Returns to Normal
- Steel Could Grow 6%
- Vaccine Campaign Faces Delays
- Britain’s Crown Agents Returns
- Covid Aid Millions Flow From US, Germany and World Bank
- DTEK Energy Restructures Debt
Ukraine’s economic activity in the fourth quarter of last year was only down 1% yoy, far better than the forecast drop of 3%, Economy Minister Ihor Petrashko told reporters at the Ukraine 30 Coronavirus: Challenges and Responses Forum in Kyiv. “Currently, the conditions for economic recovery, in principle, are quite favorable,” he said. “Our forecast for 2021 – an increase of 4.6% – we retain unchanged and [see as] quite likely.”
Ukraine’s steel production could increase by as much as 6% this year, to 21.8 million tons, according to a study prepared by the GMK Center, a metals industry analytical and consulting group: “Forecast of Steel Production in Ukraine in 2021.” By reorienting exports to China, Turkey and Southeast Asia, Ukraine’s steel sector ended 2020 recording a 1% drop in production, but rising from 13th to 11th place in the ranks of world steel producers. “Ukrainian steelmakers begin 2021 with the best conditions in the markets over the past 12 years,” the report says. “Demand for steel in the EU and MENA region has already fully recovered, while China will maintain low export volumes.”
Ukraine’s full bore coronavirus vaccination campaign may be delayed from March to April because of government paper work delays in China and Ukraine, reports Reuters. Last week, Ukraine’s Lekhim asked Ukrainian authorities’ permission to delay to April imports from China of the first shipments of 1.9 million Sinovac vaccines, according to a letter seen by a Reuters reporter in Kyiv.
Vaccinations are scheduled to start this week, drawing on an expected shipment of 117,000 Pfizer vaccines. President Zelenskiy talked on the phone with Albert Bourla, CEO of Pfizer Pharmaceutical Corporation, based in New York. “Ensuring vaccination of the population of Ukraine with a safe certified vaccine is one of our priorities,” Zelenskiy said. The President’s website reported: “The Board Chairman of Pfizer promised to do everything possible to ensure that Ukraine receives the first batches of vaccine under contract as soon as possible.”
All Ukrainians should have access to vaccines by the end of this year, Health Minister Maksym Stepanov told ICTV’s Freedom of Speech program. He vowed: “We want to ensure that 100% of the population have access to a COVID-19 vaccine by the end of 2021.” Separately, President Zelenskiy addressed popular skepticism of the vaccines, saying: “We all need to show vaccination live on TV. There’s no other choice than to lead by example.”
Ukraine’s turn last month to Britain’s Crown Agents to buy coronavirus vaccines illustrates the difficulty in breaking ingrained traditions of drug profiteering at the Health Ministry, Pavlo Kovtoniuk, Head of the Health Economics Center at the Kyiv School of Economics, writes in an Atlantic Council piece: “Ukraine signs vaccine deal, but delays highlight urgent need for healthcare reform.” Noting that Crown Agents temporarily procured drugs for Ukraine 2016-2018, Kovtoniuk, who was Deputy Health Minister at the time, wrote “For the second time in just over five years, the involvement of international partners was necessary to rescue Ukraine’s medical procurement processes from corruption.”
The vaccination of 10 million Ukrainians at risk – about one third of all adults – is a condition for Ukraine receiving a $30 million World Bank loan this spring under its Covid-19 Emergency Response and Vaccination in Ukraine project, the Finance Ministry reported. The money is to be part of a $90 million World Bank loan for Covid testing and vaccinations. Deputy Finance Minister Roman Yermolychev said: “We must understand that these are loans, and therefore their disposal must be reasonable and rational. to fulfill all obligations as much as possible in order to improve the investment microclimate in Ukraine.”
US support to Ukraine for combatting the pandemic totals $48 million over the last year, Kristina A. Kvien, US Chargé d’Affaires, told the Coronavirus Forum. She said the money has gone to bolstering Ukraine’s health system, supporting small businesses, and countering “COVID-related disinformation that threatens our collective ability to get this pandemic under control.”
Germany is proving Ukraine with a €13.1 million medical care grant that includes supplying equipment for outpatient diagnosis and treatment of coronavirus. This grant, and a second one for €23.5 million are largely focused on Ukraine’s war affected southeast where the money is to go for upgrading hospitals and building housing for internal refugees.
Talks with IMF will be delayed to the spring, making a staff level agreement in May the optimistic scenario, Liga.net reported in a lengthy story, citing unnamed Rada members and Central Bank officials.
Dragon writes: “The government has sufficient liquidity buffers to proceed without IMF financing until end-May (assuming full rollover of domestic debt), but faces an increase in fiscal funding needs in 2H21, especially in September, the peak of external debt redemptions ($2.2bn), and December, due to seasonal expansion of the budget deficit (at least half of $8.4bn full-year gap). Thus, authorities would need to secure IMF financing by August at the latest in order to facilitate funding from other sources (IFIs, Eurobond market, foreign inflows into UAH bonds).”
The Finance Ministry increased 2.5-fold its sale of bonds, but kept yields largely unchanged at the weekly auction, according to results posted on Facebook. Of the total $467 million in dollars and hryvnia equivalent sold, the 16-month hryvnia bond was the big seller, accounting for 31% of all sales and going for a weighted average of 11.15%. Of the six bonds sold, interest rates ranged from 9.89% for 6-month bonds to 12.5% for 6-year bonds. In addition, the Ministry raised $207 million through the sale of 14-month dollar bonds for 3.9%.
With snow and sub-freezing temperatures forecast, restrictions on trucks entering Kyiv are expected to continue off and on. At a peak, 3,000 trucks were stopped outside the capital, with their drivers waiting for roads to clear. At eight entry points to the city, the State Emergency Service pitched warming tents, offering hot tea and biscuits. Last night, after rush hour traffic jams subsided, trucks were allowed into the city, alleviating fears of shortages in supermarkets.
Due to the cold temperatures, coal reserves at thermal power plants fell sharply during the first week in February, hitting 57% of minimum, required volumes, Ukrenergo reported. To fill the gap, hydro plants on the Dnipro cascade increased output by 27% during the first week. Energoatom is advancing by several days the scheduled relaunching of reactor No. 2 at Khmelnitskiy Nuclear Power Plant.
DTEK Energy has announced a tentative agreement with bond and bank debt holders to restructure much of its $2 billion bond and bank debt. After 10 months of negotiations, the deal’s center piece is exchanging guarantees from DTEK Oil & Gas Receivables for $425 million of new DTEK Oil & Gas notes. Listed on the Irish Stock Exchange, these bonds would pay 6.75% cash interest semiannually and mature Dec. 31, 2026. As part of the deal, DTEK Energy will appoint an independent supervisory board member, from a list of three candidates offered by creditors, who will have a veto right on M&A and excess capital expenditures.
Analysts generally welcomed the proposed exit from a default that rattled investors last March:
Adamant Capital wrote: “The updated terms look significantly better than those disclosed at the end of November…We confirm our ‘Buy’ recommendation.”
Concorde Capital wrote: “The updated DTEK’s offer provides more clarity about minimum payments to bondholders…the updated restructuring terms look balanced.”
Dragon Capital wrote: “The updated restructuring terms mark a significant improvement over the previous version…The new proposed DTEK Energy bond structure is also simpler than the previous variant and likely to have its own dedicated Bloomberg calculator, facilitating bond trading and improving its overall liquidity.”
- Reuters Forecast: Q2 GDP Jumps 10%
- Health Goal: Vaccinate Half the Population
- E-Commerce Boosts Delivery Companies, Warehouses
- Cheap Mortgages Coming
- Poland Wants More Ukrainian Workers
Ukraine’s economy will rebound sharply to 10% growth yoy in the second quarter of 2021, breaking five successive quarters of decline, according to a Reuters poll of 12 Ukrainian analysts. The median forecast of analysts has the GDP shrinking by 0.5% yoy in January-March, but then growing by 10.2% in April-June. The sharp rebound comes from a low base: in the second quarter of last year, strict coronavirus controls forced the economy to shrink by 11.4%. If the government does not impose more lockdowns, the analysts’ median forecast is 4% GDP growth for this year.
Ukraine aims to vaccinate against Covid-19 the most vulnerable half of its population over the next year, President Zelenskiy told a forum in Kyiv, “Ukraine 30. Coronavirus: Challenges and Responses.” “We have agreed to supply vaccines to Ukraine from Pfizer, Sinovac, AstraZeneca and Novavax companies,” the President said. “The first stage of vaccination will begin this month,” he said, adding that one million vaccines are to arrive from Pfizer in coming days.
The European Investment Bank is loaning €50 million to Ukraine to help pay for vaccines, refrigeration equipment and logistics, Ihor Ivaschenko, Deputy Health Minister, told reporters at the forum. Zelenskiy said the number of new infections reported daily has dropped by two thirds in recent weeks.
People who are vaccinated or who have recovered from Covid will be exempt from quarantine restrictions, Zelenskiy said, without elaborating. “Lack of faith in vaccination, refusal to vaccinate by a significant part of the population” is “very serious issue,” Zelenskiy said. He said he would lead by example by taking the jab on TV.
China-Europe freight trains were up 66% yoy in January, to 1,165, reported China State Railway Corporation. The number of containers grew 75%, to 109,000 for the month. At this pace, one 94-container Chinese train passes into the EU every 40 minutes. With the overwhelming majority of this rail traffic passing through Belarus to Poland, Ukraine seeks to get more traffic, providing a path to southern and central Europe markets through rail hubs in Slovakia and Hungary.
A second private company has won permission to run freight trains on the tracks of Ukrzaliznytsia, the state railroad. Promvagontrans LLC was won permission to run freight trains on four routes in central Ukraine. The owner of 400 grain hopper cars, Promvagontrans is a unit of Ukrainian Agrarian Holding. In December, the first agreement was signed with Ukrainian Locomotive Company, a Lviv company. It can haul freight on 10 routes largely in Western Ukraine. This pilot program is expected to run for two years.
Riding the e-commerce boom, Nova Poshta has launched a €14 million sorting center in Kyiv that can sort up to 50,000 packages an hour. Captured in a video, the sorting center is a maze of belts, chutes and conveyors. The machinery was supplied by Vanderlande, a Dutch logistics automation company.
Postal operators – Nova Poshta, Ukrposhta and Meest Express – account for almost half of the 364,000 square meters of warehouse and logistics space to be commissioned this year, according to a study by Alterra Group. In terms of geography, 55% of the new space – or 200,000 square meters – is to open in Lviv. This includes four projects of about 40,000 square meters: expansion of the Protec warehouse in Zymova Voda; Lvivsilmash; Galileo Logistic and Port Lviv Logistic Center. New supply in Kyiv will be 71,400 square meters, largely projects delayed from 2020, reported Alterra, a commercial real estate development and consulting company.
With the warehouse market tightening, Dragon Capital Group sold Omega-2, a 32,731 square meter logistics complex in Brovary’s industrial zone, facing the city’s bypass road. “This is our first closing of a commercial real estate sale deal after we made a bet on this segment in 2016, and it demonstrates that there are opportunities in this market not only for profitable investments, but also for exits,” said Volodymyr Tymochko, Dragon’s managing director for Private Equity.
Dragon plans to return this year to its pre-pandemic levels of investment, Dragon Capital CEO, said last week at the Global Outlook meeting hosted by the European Business Association. “In the first half of the year, we plan to close five deals together with co-investors and Western funds for about $200 million,” said Fiala, who is also President of the EBA. “We hope to close them in the first half of the year, so we will return to the rates of investments that were before coronavirus.”
Public works construction pulled the sector ahead last year for an overall increase of 4%, to $7.1 billion, the State Statistics Service reports. Road construction was up 142% in nominal terms, making up for a 53% drop in renewable energy facilities. Overall engineering structures was up 15% in real terms. Residential work was down 18.5%. Commercial was down 3%. By contrast, construction grew by 24% in 2019 over 2018. Last year, construction in Kyiv City was down 2%. But the capital remained far and away the nation’s leader, with $1.5 billion in construction work.
Starting March 1, the State Mortgage Institution will start to offer home mortgages at 7%, Prime Minister Shmyhal announced last week. For reference, Ukraine’s prime rate has been 6% since June 2020.
Ukrgazbank, a state-owned bank, reports that since July it has made $16 million worth of low interest mortgages to 548 people. Half of the mortgages are for under 10%. For dachas, or secondary homes, the bank offers 20-year loans under these conditions: fixed for the first two years at 9.9%, then fixed for the next 18 years at 12.99%.
Despite tight border controls imposed during last spring’s coronavirus lockdown, remittances from Ukrainians working outside the country increased by 2% last year, to $12.1 billion, according to data from the National Bank of Ukraine. Transfers through banks increased by 24%, to $4.7 billion. Another $2.7 billion came in through international payment systems. Informal channels – through relatives, friends and bus drivers – decreased, probably due to difficulties crossing borders.
Worker migration remains strong to Poland, a country that suffered one of the EU’s smallest GDP drops in 2020 – an estimated 2.7%. During 2020, the number of foreigners officially working in Poland increased by 8%, to 725,000, according to Poland’s Social Insurance Institution, or ZUS. Of these, Ukrainians account for 73%. In an international appeal, Poland’s Education Ministry listed the five most needed professions: roofer, locksmith, road worker, software engineer and automation specialist. An article on the appeal by TSN.ua news site got 6,882 visits within 12 hours of posting.
- Covid Supply Chain Cuts Could Bring Investment to Ukraine
- Covid Vaccinations Start This Week
- Covid Cases Dropped by Half in January
- One Third of Nation to be Vaccinated by Year End
- NASA Awards $93 million Contract to Ukrainian-American Company to Send Rocket to the Moon
‘Near-shoring’ – or bringing production capacity closer to the EU may boost investment into Ukrainian from European manufacturers hurt last year when supply lines were cut by coronavirus restrictions, Sergiy Tsivkach, head of the state’s UkraineInvest, told Bloomberg in a story headlined: “Supply Chain Shakeup After Virus has Ukraine Eyeing Investments.” Starting this year, Tsivkach aims to attract $7.7 billion. Last year, for the first time in five years, Ukraine had a net outflow of foreign investment – $420 million, according to the National Bank of Ukraine.
Projects in the pipeline include $1.1 billion of investments in mining and processing by Canada’s Black Iron Inc. and a €200 million wood products facility to be built by Austria’s Kronospan. Tsivkach said Belgian mattress-fabric maker Monks International and Danish furniture producer Hjort Knudsen also are building plants in Ukraine.
Coronavirus vaccinations start this week in Ukraine, Health Minister Maksym Stepanov tells Ukraina 24 TV. Initially, the Ministry to draw on a small initial shipment of 117,000 doses of U.S.-made Pfizer-BioNTec obtained under the global COVAX initiative.
In the pipeline are 25 million doses, enough for one third of Ukraine’s 37 million people to get the requisite two shots by the end of this year:
- 12 million doses of the vaccine developed by AstraZeneca and Novavax are to come from the Serum Institute of India, President Zelenskiy announced.
- 8 million more doses under the United Nations Covax program
- 5 million doses of the Chinese CoronaVac
This month, the first 50 of 500 mobile vaccination teams are to start working, Prime Minister Shmyhal told the Cabinet. In addition, he said, health workers are preparing 1,500 vaccination rooms across the nation and 50 vaccination centers in big cities.
“The sooner we get the vaccines, the faster we will overcome the pandemic in Ukraine,” President Zelenskiy said on announcing the 12 million Indian-made vaccines. “I know that the Cabinet of Ministers is working thoroughly to develop a website that will help Ukrainians register for vaccination easily and conveniently.”
Ukraine’s daily rate of detected cases dropped roughly in half over the last month – from 6-9,000 at the start January, to 3-5,000 cases a day last week. To date, 1.2 million Ukrainians, or 3% of the population are known to have contracted the virus. To date, 23,597 have died, making for a fatality rate of 2%. People aged 60 and over accounted for 84% of fatalities, the Health Ministry reports. In the year since the pandemic hit Ukraine, almost 10 million tests have been performed.
Vaccinations of soldiers start at the end of this month, says Serhiy Khalik, acting commander of Medical Forces of the Armed Forces. To date, 15,005 members of the military are known to have contracted the virus, or 6% of the 250,000 in total. Only 43 have died.
Almost half of Ukrainians have antibodies to Covid-19, Natalia Vinohrad, head of Epidemiology at Lviv National Medical University, told Savik Shuster’s ‘Freedom of Speech’ TV program. “Despite the fact that a lot of people say that they have not been sick with coronavirus and have not experienced any similar symptoms, 43% of the population of Ukraine has antibodies,” she said Jan. 29.
Only 43% of respondents to a poll in mid-January said they would take the vaccine, even if free. If they had to pay, only 39% told Rating Group that they would buy the vaccine. Commercial sales of vaccines are expected to only start this summer.
About one third of $2.8 billion Covid-19 Fighting Fund went to build roads last year, the Finance Ministry reports. About 23% went to the Health Ministry. The rest went to unemployment benefits, insurance payments and aid to small businesses.
Concorde Capital’s Evgeniya Akhtyrko noted that the Finance Ministry report was a requirement for the IMF program that started last June. She writes: “It was obvious that the Zelenskiy administration used the project of big road building as a tool for maintaining its popularity. This misuse of public funds also undermines the trust of Ukraine’s Western partners, which were involved in disbursing substantial funds for COVID-related needs in Ukraine…the reported information will be taken into account in the IMF’s decision-making on financial assistance to Ukraine.”
NASA has awarded a $93 million contract to Firefly Aerospace Inc. to deliver 10 payloads to the Moon’s Mare Crisium in 2023, the Ukraine-originated company reports from its headquarters near Austin, Texas. Founded by Ukrainian-American Max Polyakov, Firefly has almost half of its workforce of 330 in Dnipro. Under the contract, a Firefly rocket and its Blue Ghost Lunar Lander will deliver NASA and 50 kg of commercial cargo to the Crisium basin. Data gathered from this mission is to pave the way for a 2024 manned mission to the area. Firefly also is participating in this mission, called Artemis.
Firefly has several other contracts with the US space agency. In December, NASA reported that Firefly signed a $9.8 million contract to launch satellites for space research. In addition, Firefly is developing its BETA rocket to launch satellites into low Earth orbits.
January’s average gas price was 23.5% higher than December’s price, according to State Customs Service numbers. In face of the price hike, the government has capped prices through March 31 at the January average price – $250 per 1,000 cubic meters. The December price was 11% higher than the November price.
Ukraine’s coffee imports increased by 63% in the last five years, hitting almost 50,000 tons in 2020, reports the Ukrainian Agribusiness Club. Of the $166 million business, Ukraine imports only 16% from producer countries – Vietnam and Brazil. The rest comes from intermediary countries, notably Poland, Italy and Germany. According to the UN’s Food and Agriculture Organization, coffee consumption in Ukraine increased six-fold since 2000, hitting 1.2 kilo per person in 2018.
The original English version is from our partner UBN – Ukraine Business News. For more information and news archive, go to: www.ubn.news.
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