- Road Trip: France’s Renault Starts Producing Automobiles at ZAZ
- US Car Imports Rebound
- Speed Cameras Cut Accidents
- Coming: Tenders for $2 billion in Toll Highways
- Ukrainians Support Spending Billions on Roads
- Motels to Follow the Pavement
France’s Groupe Renault starts manufacturing cars this fall at the Zaporozhia Automobile Plant, UkaAVTO corporation, parent of ZAZ, announced Thursday. “ZAZ underwent a large-scale modernization in order to fully comply with the international quality standards of Groupe Renault,” UkrAVTO says, without specifying investment amounts or models to be produced. Max Missana, Eurasia managing director of Groupe Renault Export, says: “Made in Ukraine will be at the same quality level as the products of other plants of the Renault Group.” In the region, Renault produces cars in Romania, Russia and Turkey.
Once Ukraine’s largest car plant, ZAZ stopped producing cars in 2018. As recently as 2008, Ukraine produced 424,000 cars. Production has almost stopped. In July, Ukraine produced 172 cars – all at the Eurocar plant in Uzhgorod. Through July, ZAZ produced 26 buses. Nikolay Evdokimenko, ZAZ board chairman, says the joint venture with Renault will create jobs and contribute to the revival of car manufacturing here.
In August, car imports were up 35% yoy, to 32,800, reports Ukravtoprom, the vehicle industry association. In contrast, imports of new cars were down 16% yoy, to 7,000. Through August, Ukraine imported 206,500 used cars, four times more than new cars.
Imports of used cars from the US are returning to a pre-crisis level of 10,000 a month, Volodymyr Kovel, co-founder of a new association to defend car importers, told Interfax-Ukraine. The association is forming in reaction to market disruption caused in February, when the Internal Affairs Ministry proposed banning imports of ‘recycling’ cars, or cars that had been in accidents. In protest, 18,000 people signed an online petition on President Zelenskiy’s website. The import and repair of lightly damaged cars from the US is expected to be a $1 billion business next year. The most popular imports from North America are: Volkswagen Jetta and Passat cars assembled in Mexico, and Ford Focus and Fusion cars.
During the first 100 days of speed cameras, accident rates in the areas with cameras have dropped by a factor of six, said Aleksey Biloshitsky, deputy head of the police patrol department. Since the first 50 cameras were installed in Kyiv City and Region starting June 1, patrol officers have issued 833,949 speeding tickets. Drivers have paid fines in 77% of the cases. Drivers who pay within 10 banking days get a 50% discount. No driver has overturned a speeding ticket in court. Cameras click on cars going 20 km over posted limits. Foreign plated cars with unpaid tickets are not allowed back in the country.
Tickets for major speeding violations are to be increased 6.5 times, to $122, under a law expected to be passed this month by the Rada at second reading. These fines would be levied on drivers exceeding speed limits by 50 km or more. Penalties for drunk driving will also be increased to include jail time and loss of license for up to 10 years, Anton Gerashchenko Deputy Internal Affairs minister, told reporters on Wednesday.
Ukraine aims to cut road accidents by 30% by 2025, Infrastructure Minister Vladyslav Krikliy, advised a government-business meeting, “Safety Matters.” He said this would save 1,500 lives a year and avoid injuries to another 15,000 people. To get there, Ukravtodor, the state highway agency, is building 26 roundabouts, 76 collision absorber systems, hundreds of speed cameras and 887 illuminated pedestrian road crossings. The World Bank estimates road accidents cost Ukraine two percent of GDP, or $2 billion.
With the government investing $3 billion in road repair and construction this year, the Cabinet of Ministers voted to expand checks for overweight trucks to 24 hours. They damage asphalt, and roads particularly in the hot weather. After initial tests this summer, another 50 weight-in-motion detection systems are to be installed this year. Infrastructure Minister Krikliy said 100 more will be installed in 2021.
Strong popular support seems to guarantee continuation of President Zelenskiy’s “Big Construction” for years to come. Of 2,049 people polled nationwide last month, 90% supported this infrastructure renewal program, according to the Kiev International Institute of Sociology. Asked to name the top priority, 49% answered ‘roads.’ Respondents said they “fully support” these programs: ceasefire in Donbas – 80%; Big Construction – 67%; 5-7-9% affordable loans for small businesses – 38%; reduction of the central bank’s key lending rate – 23%; introduction of a ‘free land market’ – 14%; and legalization of gambling – 12%.
Paving advances around the nation at the rate of 20-30 km per day, announced Ukravtodor. So far this year, repaving or rebuilding has been completed on 1,700 km, or 42% of the promised 4,000 km. With the roadwork season to last for another two months, Ukravtodor hopes to meet its target by mid-October. Next year’s target is 7,000 km.
Of the 24 oblasts, there are road building winners and losers. According to Ukravtodor, the winners are: Kharkiv – 200 km; Zakarpattia – 174 km; Zaporizhia – 167 km; Luhansk – 123 km; Sumy – 122 km; Lviv – 116 km, and Poltava – 109 km. The losers are: Chernivtsi – 10 km; Kirovohrad – 11 km; Vinnytsia – 21 km, and Rivne region – 23 km.
Public-private partnership tenders are being prepared for 1,500 km of highways, with a total expected price tag of $2 billion, according to Infrastructure Minister Krikliy. “Thanks to the World Bank, we have already prepared a pre-feasibility study for six road sections, the total length of which reaches 1,500 km. The size is about $ 2 billion in investments. We are preparing a public-private partnership for these projects.”
With Ukrainians largely bottled up inside the country this year, the number of Green Card international auto insurance agreements concluded from January through July dropped by 44% yoy. Similarly, premiums paid dropped by 35%, according to the Motor Transport Insurance Bureau of Ukraine.
Believing that Ukraine’s highway construction will create a US-style long distance driving culture here, two Kyiv expats are raising $50 million to build a string of 10 hotels in the suburbs of Ukraine’s major cities. The 3-star hotels would have 100-120 rooms, would follow international standards, and would be paired with McDonald’s for food and beverage. Drivers behind Force One hotel chain are: Terry Pickard, chairman of Pickard Real Estate & Asset Services, and Jesper Henriksen, former Ukraine manager for Radisson Hotel Group.
- Happy Days Are Here Again: Economic Indicators Point Up
- Cabinet Okays Extensive Privatization List
- Capital Investment Shrank 35% in H1
- Court Actions for Surkis and Motor Sich
- EU Airlines Announce More Flights to Ukraine
Signs indicate that Ukraine’s economy is climbing out of the corona-recession:
Rail freight volumes were up 10.3% last month over the level of August 2019. Ukrzaliznytsia moved 28.3 million tons of cargo last month, reports RAIL.insider, drawing on statistics from the portal Data.gov.ua. August was the fourth month of rail cargo growth and the first month that cargo levels surpassed those of one year earlier. The state railroad moves the bulk of the nation’s exports and cargo subsidizes passenger service. Since January, UZ has carried almost 200 million tons of cargo.
Electricity consumption in August 2020 returned last year’s level, reports Ukrenergo, the state-owned power grid operator. Compared to August 2019, household power consumption was up last month by 5.7%. Industry was down 2.9%. Within the industrial grouping, downturns in consumption were: machine-building industry -12%; metallurgy -6%; and fuel -3%. At the same time, electricity consumption grew by an average of 5% in food processing, chemicals and petrochemicals, and building materials.
Deflation, a sign of collapsed consumer demand, fell to -0.2% in August, the State Statistics service reported. In annual terms, inflation in August 2020 was 2.5%. With buying power returning, inflation is expected to grow gradually in coming months.
The ICU investment group has improved its forecast for Ukraine’s GDP this year, lowering its estimate of the fall to minus 5.7%, from its earlier forecast of minus 6.7%. This year’s drop will be cancelled out by next year’s growth of 5.6, Sergiy Nikolaychuk, the head of ICU’s macroeconomic research tells Interfax-Ukraine. He said the softening of this year’s fall “was facilitated by the rapid ‘turn on’ of the economy in the summer, and by the improvement of the terms of trade due to high prices for iron ore.”
Iron ore exports were up 13% through August, compared to the tonnage for the first eight months of last year, reports the State Customs Service. Companies exported 31 million tons, earning $2.5 billion. The top three importers of Ukrainian iron ore are: China – 34%; Poland – 12%; and the Czech Republic – 10%.
By the end of this year, the government plans to privatize: Kyiv’s President Hotel, the Odesa Port Plant, the Electrotyazhmash plant, the Krasnolimanskaya Coal company and the United Mining and Chemical Company. Last week, the Cabinet of Ministers approved this list. A Rada vote will be needed to lift the freeze on privatizations, approved last spring, at the start of the coronavirus quarantine, Svetlana Panaiotidi, deputy economy minister, wrote on Facebook.
Capital investment in Ukraine’s economy shrank by 35% in the first half of the year, compared to January-June 2019, according to the State Statistics Service. The new level of investment was $5.9 billion. All sectors recorded declines, with the biggest in: art, sports, entertainment and recreation – 74%; hotels and restaurants – 58%; and transportation – 54.5%.
Justifying Ukraine’s recent stealth re-purchase of 10% of its $3.2 billion in GDP-linked warrants, Finance Minister Sergiy Marchenko confirmed that the 2015 warrants are a financial time bomb that could cost the nation up to $22 billion by 2040. With current GDP growth forecasts, Ukraine will have to make its first pay out – $40 million – next year. By 2023, payments could balloon to $600 million. Speaking to the Rada Committee on Finance, Tax and Customs Policy, he justified the stealth operation saying: “After the end of the operation, we removed the “secret” stamp and, as a result of the publication of this information, the prices for GDP warrants jumped by 8%.”
Timothy Ash writes from London: “[I am] not sure it’s a great idea to go out saying payments on these instruments could be $22 billion through 2040. That’s just going to bid up their price and increase buy back costs.”
Ukraine’s Supreme Court has frozen a lower court decision that would have forced state-owned PrivatBank to pay $350 million to Ihor and Hryhoriy Surkis, two brothers seen as ‘related parties’ to the owners who looted the bank until its nationalization in 2016. Two weeks ago, a lower court ruled the brothers’ six British companies can start withdrawing the first portion of the $350 million. That ruling drew widespread condemnation and seemed to raise a red flag to continued cooperation with the IMF. At the same time, the Rada registered a bill that would prohibit payments on court cases that have not been considered on their merits. The bill is already called the “anti-Surkis law.”
Concorde Capital’s Alexander Paraschiy writes: “A solid reaction from the government to an apparently ill-grounded court ruling that costs about UAH 10 billion [$360 million] to the state bank is a good signal. Such a reaction significantly decreases the chances that the Surkises will be able to withdraw money from the bank, though it does not completely rule out such an event.”
China’s Skyrizon, and Kharkiv’s DCH Group will submit an updated application to the Antimonopoly Committee of Ukraine for the purchase of Motor Sich, the Zaporizhia-based aircraft engine maker, Interfax-Ukraine reports. It cites a notice sent to the Shanghai Stock Exchange by Beijing Xinwei Technology Group, parent company of Skyrizon. Interfax reports that Chinese accumulated 75% of Motor Sich shares before Ukraine’s State Security Service intervened to stop the sale. Skyrizon threatens to sue Ukraine, demanding compensation for $3.5 billion in losses, Unian reports.
Concorde Capital’s Alexander Paraschiy writes: “The stakes are rising for Ukraine in the Motor Sich story. If this case shifts to a geopolitical battle between China and the U.S., Ukraine will have to choose between the two sides, which could lead to significant losses for the country. But what it can lose for sure is Motor Sich itself.”
Kyiv registered a record 310 new coronavirus infection, announced Mayor Klitschko. To publicize the problem, he was later filmed visiting a Covid treatment hospital in the capital. Of the 310 new cases, 43 are hospitalized. The rest are undergoing medical treatment at home. Separately, the Ukrainian Armed Forces confirmed 68 new coronavirus cases. Currently 534 soldiers are in isolation after testing positive for the virus.
European airlines are testing the waters with announcements of expanded schedules to Ukraine. Starting Oct. 25, Air France will fly between Paris Charles de Gaulle and Kyiv Boryspil three times a week. Starting Oct. 27, Ryanair will fly daily between Kyiv Boryspil and Berlin Schönefeld. Last week, Poland’s LOT increased the frequency of its flights between Lviv and Warsaw-Chopin, from daily to 12 times a week.
- Ukraine May Return to Eurobond Market
- $4 Billion in Deals in Last Six Weeks
- ’Big Construction’ to Start Rebuilding Airport Runways in Mukachevo, Poltava, Sumy, and Zhytomyr
Ukraine may place $1-1.5 billion worth Eurobonds this fall to cover the budget deficit and to buy back more GDP warrants, predicts Bank of America Securities. This would follow July’s successful placement of $2 billion worth of 13-year Eurobonds. That deal, at 7.25%, was three times oversubscribed. Potentially chilling foreign interest, the IMF’s planned September review of the $5 billion Standby Agreement with Ukraine may be delayed, BofA warns.
Facing weak investor demand, the Finance Ministry sold last Tuesday only one third the volume of hryvnia bonds as at last week’s auction, and at slightly higher yields. The government sold the hryvnia equivalent of $35 million, one third for 1-year bonds and two thirds for 3-year bonds, the Ministry reported on Facebook. The weighted average yield for 1-year bonds was 9.28%, virtually unchanged. For 3-year securities, the yield was 10.46% – 46 basis points above the last auction of 3-years, one month ago.
Fitch, the ratings agency that most closely follows Ukraine, reaffirmed its ‘B’ rating for Ukraine, with a stable outlook. Japan’s R&I upgraded Ukraine’s sovereign rating last week by one notch, from B to B+, outlook stable. Since March, Standard & Poor’s has given Ukraine a B stable rating. In June, Moody’s brought Ukraine up one notch to B3 stable.
Concorde Capital’s Alexander Paraschiy writes: Looking at the balance of possible positive and negative triggers for Ukraine’s rating, we see a low chance for Ukraine to get any better rating in the next year.
A new Eurobond placement would come on the heels of two large deals:
- In late August, the Finance Ministry borrowed $329 million from JPMorgan Chase & Co. at 7.75% to buy back about 10% of the $3.2 billion worth Ukraine’s GDP-linked warrants issued as part of the 2015 debt restructuring. It is believed Ukraine bought the bonds back at 90% of par value.
- On Sept. 1, the Finance Ministry redeemed $1.69 billion worth of Eurobonds issued in 2015 and maturing this year. At the same time, the Ministry paid $400 million in interest payments on Eurobonds maturing in 2020-2027. Looking ahead, the Ministry said on its website: “By the end of the year, the balance of foreign currency payments on the state debt is about $ 1.6 billion.”
Ukraine’s international reserves grew to $29 billion in August, the highest level in eight years, reports the National Bank of Ukraine. Boosting reserves, foreign travel by Ukrainians was down sharply due to the coronavirus restrictions and the nation enjoyed a trade surplus.
Ukraine is on track with the IMF, Finance Minister Serhiy Marchenko said Monday on Inter TV’s Details of the Week program. He said: “We are in a dialogue with the IMF and hope to receive the next tranche. We have two more tranches planned by the end of the year for $700 million each, and in the near future there will be an online conference, that is, it will not be a visit, it will be an online mission of the fund.”
Timothy Ash retorts from London: “The danger with this official line that things are fine on the IMF front is that politicians are lulled into a false sense of security, when the reality is that this Fund program is in serious trouble. Someone needs to read the riot act to the Zelenskiy Administration that unless they address the mounting list of issues related to the National Anti-Corruption Bureau, the anti-corruption agenda more generally, independent supervisory boards at state companies, PrivatBank and the banking reform issue, then there will be no more IMF money from the Fund or other official creditors – and you can only string the market along so long with warm words.”
Domestic air flights were down the least of air travel in August, down only 17% yoy to 2,519, reports UkSATSE, Ukraine’s air traffic control agency. By contrast, 8,249 – international flights to and from Ukraine were down 50%, to 8,249, and transit flights through Ukraine’s air space were down 68%, to 5,922. After last spring’s collapse, air flights in Ukraine have steadily recovered: 2,372 flights in April; 3,237 in May; 4,584 in June; 12,195 in July; and 16,690 in August. Flights are expected to drop again in September as the government has closed Ukraine to most foreign travelers for the month.
By 2023, several key regional airports will be reopened under the ‘Big Construction’ program, President Zelenskiy promised last week on a visit to Poltava airport. “We will add all airports to the program,” he said, referring to second tier airports that have languished since the 1990s. Promising to start rebuilding Poltava’s runway next year, he said: “We will definitely make Poltava Airport part of our ‘Big Construction’ program.”
President Zelenskiy promised to rebuild the runway of Sumy airport, if the regional government finds an investor to rebuild the terminal. “We are ready to build this strip in Sumy, if you have those who will build the terminal in parallel,” he told Roman Grishchenko, head of the regional administration, on a visit to the airport. Two years ago, the Infrastructure Ministry estimated that it would cost €25 million to rebuild the Soviet-era terminal and the 2,500-meter runway. Without scheduled service for over a decade, the airport is a 3-hour drive to Kharkiv or Poltava airports and a 4.5-hour drive to Kyiv Boryspil.
Zakarpattia will get an international standard airport with the construction in coming years of a $145 million airport in Mukachevo, Infrastructure Minister Vladyslav Krikliy promises on Facebook. Last month, the Cabinet of Minister approved spending $1 million to design an airport on the site of an abandoned Soviet-era air base south of the city. Under the plan, a private investor would build the terminal. The Infrastructure Ministry would build a 2,500-meter long runway, capable of handling B737 and A320 passenger jets for flights to the EU and Turkey and Egypt. Zakarpattia’s current airport, in Uzhgorod, has limited capacity due to restrictions imposed by neighboring Slovakia and the EU.
Zhytomyr regional authorities are talking with a private investor to build an air cargo hub at Zhytomyr airport, a 90-minute drive west of the Kyiv’s Ring Road. Vitaly Bunechko, head of the regional government, tells Interfax-Ukraine that the airport first needs $13 million in government aid to expand the runway by 50%, to 2,500 meters. Opened in 1939, the airport provides maintenance for Yanair’s all-Boeing fleet of 737s and offers easy access to Sergei Pavlovich Korolyov Museum of Cosmonautics.
Corona virus infections, hospitalizations and deaths are running at double the levels of one month ago, Ukraine Health Ministry figures show. On Monday morning, Health Minister Maksym Stepanov announced that 57 people died in the last 24 hours. At the same time, 2,411 new cases were announced, and almost 8,000 people are undergoing treatment in Ukrainian hospitals.
- China Discusses Building Mammoth Black Sea Grain Terminal
- Ukraine’s Exports Recover, Seaport Cargo Up 5%
- First Wheat Shipment to Saudi Arabia
- With Gas Glut, EU Traders Stuff Gas into Ukraine Reservoirs
- Saakashvili Wants to Become Prime Minister of…Georgia …
A Chinese state company is discussing building a massive Black Sea grain terminal that could handle 5 million tons a year, the equivalent of 10% of Ukraine’s corn and wheat exports. Representatives of China Road Construction Corporation International Investment met with executives of Pivdennyi port, Ukraine’s deepest and busiest port. The project would represent a big expansion for Pivdennyi, located 45 km east of Odesa. Last month, iron ore accounted for 86% of the 1.5 million tons of cargo handled at the port.
Chinese container trains now arrive at Kyiv at the pace of one a week, reports Ukrzaliznytsia. Traveling 9,000 km from Nanchang in 15 days, the latest train arrived at Kyiv’s left bank Liski freight depot. Its 41 containers carried mineral fertilizers, lamps, bulbs, medical cargo and chemical components for filtering water. With three more container trains due to arrive this month, Ukrzaliznytsia is booking return freight of Ukrainian goods for China.
Ukraine seeks Chinese investment in industrial parks specializing in processing, storing and transshipping food, Olga Stefanishyna, deputy prime minister for European and Euro-Atlantic Integration, told China’s new ambassador to Ukraine, Fan Xianrong. Ukraine wants to increase food exports to China, and to use Chinese free ports to export to Pacific Basin countries, she said, reports the Cabinet of Ministers website. “To intensify cooperation,” her Ministry is establishing a working group with the Chinese embassy.
Through August, Ukraine’s seaports handled 5% more cargo than during the same period last year, reports the Ukrainian Sea Ports Authority. The 106 million tons of cargo breaks down as follows: exports +5.4%, to 81 million tons; imports +1%, to 16 million tons; transit +4.6%, to 7.3 million tons; cabotage +31%, to 1.6 million tons. The two main export products were nearly even: grain – 30.7 million tons; and metal ore – 30.2 million tons. Pig iron exports jumped 50%, to 2.3 million tons. Containers were up 9.2%, to 690,600.
Ukraine’s top five ports handled 91.5% of the nation’s cargo during the first eight months of this year, reports the Sea Ports Authority. Pivdennyi once again was the most dynamic, with its cargo levels growing by 25% yoy, to handle 42 million tons, or 40% of the nation’s total. This growth was at the expense of Ukraine’s next three busiest ports: Mykolaiv -10%, to 19.2 million tons; Odesa -7%, to 15.6 million tons; and Chornomorsk -1%, to 15.4 million tons. Strong growth was registered at the two Azov ports. Mariupol was up 21%, to 4.6 million tons. Berdyansk was up 33%, to 1.5 million tons.
Ukraine’s exports are recovering from last spring’s corona-recession. August exports were down only 1.6% yoy, “which in the context of a pandemic sounds like fantasy,” Taras Kachka, deputy minister of Economic Development, Trade and Agriculture, writes on Facebook. “International trade is recovering at a much faster pace than after the 2008 crisis.” For the first eight months of the year, exports are down 6.6%, to $31 billion. With imports down by 12.4%, the trade deficit through August is $1.3 billion, about one third the level of the same period last year.
Ukraine exports of corn, wheat, and barley will drop around 9% yoy, to 51 million tons, in the current marketing season, predicts Grainmart, India’s first Grain Trading B2B online marketplace. Based near New Delhi, Grainmart draws on figures from the Ukrainian Grain Association.
Two years after Saudi investors bought Ukraine’s troubled Mriya Agro Holding, a shipment of 60,000 tons of Ukrainian wheat is on its way to Saudi Arabia. In the first such shipment to Saudi Arabia in 12 years, a Panamax carrying Ukrainian grain from Chornomorsk arrives Sept. 17. In 2018, Saudi Agricultural Investment and Livestock Company, or Salic, bought Mriya and merged it with its existing Ukraine farms under an umbrella company, Ukrainian Continental Farmers Group. Georg von Nolcken, general director of Continental, says: “This is certainly a good indicator and a clear signal of serious investment intentions of Saudi Arabia in Ukraine.”
Ukraine’s natural gas imports jumped 67% yoy in August, as EU gas traders filled Ukraine’s gas storage reservoirs to a record 84% of capacity. Traders store their gas in Ukraine, waiting for the traditional autumn rise in prices as Europe prepares for winter. For its own use, Ukraine’s Naftogaz had 26 billion cubic meters in storage on Saturday, 39% more than one year earlier.
Mikheil Saakashvili was chosen to lead an 11-party opposition coalition in Georgia’s Oct. 31 parliamentary elections. If the coalition wins, the former Georgian president would become prime minister. If the coalition loses, Saakashvili presumably would return to his Kyiv job: chairman of Ukraine’s National Reform Council. Levan Varshalomidze, former governor of Batumi and a longtime ally of Saakashvili, also took a sabbatical last week from his Ukraine job, board chairman of UkraineInvest.
Traffic at Boryspil was down 60% yoy in August, to 656,029 passengers, reports the Center for Transportation Strategies. Traffic on charter flights was down by only 9%, indicating that Kyiv residents cling to their package tours to Egypt and Turkey. By contrast, traffic on regular flights – largely to the EU and North America – was down by 78%. Traffic is expected to be even worse in September because the government has closed Ukraine to most foreign visitors for the month.
- Ukraine Beckons Belarus IT
- China’s Skyrizon Moves to Arbitration with Ukraine over Motor Sich
- Middle East Becomes Ukraine’s Top Poultry Export Market
- Real Wages up 5%
- Corona Spreads: Ukraine Now Has Europe’s Third Fastest Rate of New Infections…
Recruiting Belarus IT workers – Ukraine’s Digital Transformation Ministry has opened a special web portal for Belarusian IT specialists who want to move to Ukraine and has hired Denis Aleinikov, a Belarusian lawyer who developed a special, low tax IT zone in Minsk. “About our initiative to support IT professionals living in Belarus…there is technical support, which works 24 hours a day and already helps specialists from Belarus,” Mykhailo Fedorov, Ukraine’s digital minister, said while introducing Aleinikov to reporters. Of the 4,500 Belarusians who have fled to Ukraine to escape the police violence in Belarus, more than 300 are IT workers, Fedorov said.
Aleinikov is to help the Rada draw up a low tax, liberal labor law IT park similar to the Hi-Tech Park he helped build near Minsk. The park now has 880 registered companies. Last week, President Zelenskiy signed a decree giving the Rada 90 days to draw up legislation. “The Presidential Decree is public support, the political will for this project to move forward faster,” Fedorov said. “We will create the world’s most comfortable economic zone with low taxes, legal employment, high wages. Favorable conditions for startups and entrepreneurs.”
With this investment regime, Fedorov aims to create an additional 450,000 IT jobs in Ukraine by 2025, generating $12 billion in economic activity. Last year, Ukraine’s IT exports grew 30% yoy, to $4.2 billion. Currently, Ukraine’s 4,000 IT companies employ 200,000 specialists. Short of staff, Ukrainian companies look north to Belarus where 60,000 IT specialists work in Minsk alone.
“Belarusian tech companies leave their country amid protests, move to Ukraine” headlines a Kyiv Post article featuring interviews with Belarusian IT workers who are moving or considering moving south. After the largely discredited Presidential vote of August 9, 168 IT workers were arrested in protests. Since then, the internet has been repeatedly turned on and off. Over 2,500 IT executives and workers signed an open protest letter to President Lukashenko. “People can’t focus on work because of the constant stress,” George Kachanouski, founder of Scootapi, says from Minsk. “Many companies plan to relocate temporarily now, but if the dictatorship wins, then for good.”
China’s Skyrizon company has notified Ukraine’s Justice Ministry that it intends to start international arbitration against Ukraine over access to the Motor Sich aircraft engine factory, reports UNIAN. Noting that it bought 56% of Motor Sich shares in 2016, Skyrizon is demanding $3.5 billion in damages for being unable to enter the factory complex for the last four years. Skyrizon argues that moves by Ukraine’s State Security office and Anti-Monopoly Committee violate the China-Ukraine investment protection treaty adopted by both countries in 1992.
During the first half of this year, Ukraine’s poultry exports were virtually constant in volume – 212,300 tons – but down 12% in monetary terms, to $271 million, reports Poultry World. At a press conference in Kyiv, Sergey Karpenko, executive director of the Union of Poultry Breeders, warns that a government plan to create a new agency to replace Gosprodpotrebzlyuzba, the state food safety regulator, could disrupt exports as new certificates will have to be negotiated with the veterinary agencies of importing countries.
The Middle East has displaced the EU as the top destination for Ukrainian chicken meat, reports The Poultry Site. The change is due partly because of new EU quotas and an avian flu outbreak in Vinnytia in January. In the first half of this year, the biggest markets were Saudi Arabia – 18%; the Netherlands – 17%; and UAE – 12%. For MHP, Ukraine’s largest producer, poultry exports were down by 10% during the first half, to 170,553 tons. Last year, MHP’s exports were up 25% yoy, to 357,400 tons.
The number of new filings for unemployment aid have dropped steadily: from 149,000 in April to 68,000 in July, reports the Ministry of Economic Development, Trade and Agriculture. Since the government adopted corona quarantine measures in mid-March, the government has paid $272 million in benefits to 432,000 people, about $630 per person.
Real wages were up 5% in July yoy, reports the State Statistics Service. The biggest growth sectors, in nominal terms, were: medicine and social services – +18% yoy; and IT and telecom – +14.4% yoy.
ICU writes: “The recovery of wages confirms a quite rapid exit of the labor market from the coronavirus-induced recession. The rebound of workers’ income is also evidenced by the high growth rates of retail trade and production of consumer goods.”
After a record week of coronavirus infections, Prime Minister Shmygal vowed that there will be no repeat of last spring’s lockdown. “We understand, both the government and the state leadership, there can be no second lockdown in Ukraine – most countries realize this,” he told a business forum at Kyiv’s UNIT.City. “Closing down the country over the quarantine as it was in the spring, is impossible.”
Even with Sunday’s dip to 2,107 new cases, Ukraine’s ranks third in Europe for new cases, behind only France at 7,071, and UK at 2,988, according to Worldometer’s Coronavirus tracker. Worldwide, Ukraine ranks in 9th place for new infections. Despite this surge, schools opened across Ukraine, with the exceptions of 5% of the nation, which is classified ‘red.’
Currently two regional capitals, Ivano Frankivsk and Ternopil, are classified red. In advance, the mayors of both cities sued the Cabinet of Ministers in Kyiv District Administrative Court. The list published by the Cabinet of Ministers shows that most orange and red areas are in Western Ukraine. Although Kyiv city registers about 300 new cases a day, it is classified yellow, largely due to the large population.
One upside of Ukraine’s increasing infection rate: the Health Ministry has reduced its list of ‘red’ zone countries to 35. Red zone countries – those with recent infection rates above Ukraine’s 80/100,000 – include the US, Israel, France, Spain, Croatia, Moldova, and Romania. Travelers from these countries have to self-isolate until they test negative for Covid-19. Ukraine’s borders are largely closed to foreign travelers until the end of the month. Due to Ukraine’s high infection rate, foreign travel and foreign flights from Ukraine are restricted.
The new spread of the virus has hit home for many Ukrainians with the news of the hospitalizations in Kyiv of two well-known figures. Filaret, the 91-year-old Patriarch of the Ukrainian Orthodox Church of Kyiv Patriarchate was in stable condition at a Kyiv hospital. Yulia Tymoshenko, the 59-year-old leader of the Fatherland political party, emerged from intensive care. “Fighting off a serious disease for almost two weeks alters the perception of reality,” she wrote on Facebook from a Kyiv hospital. “Although recovery is still a distant prospect, now there is an opportunity to return to normal life, step by step.” She signs off: “Thank you and hug you tight. Everything will be fine!”
The original English version is from our partner UBN – Ukraine Business News. For more information and news archive, go to: www.ubn.news.
#Renault #GroupeRenault #ZAZ #UkaAVTO #MaxMissana #Missana #UkraineCarproduction #CarproducerUkraine #Eurocar #NikolayEvdokimenko #Evdokimenko #CarimportUkraine #UkraineCarImport #Ukravtoprom #VolodymyrKovel #Kovel #Interfax #InterfaxUkraine #Selenskii #Selenskiy #Zelenskiy #PresidentUkraine #VW #Volkswagen #Jetta #Passat #VWPassat #Ford #Focus #FordFocus #FordFusion #UkraineSpeedCameras #Ukraine #Kyiv #Rada #AlekseyBiloshitsky #Biloshitsky #SpeedinglawUkraine #AntonGerashchenko #Gerashchenko #Krikliy #VladyslavKrikliy #Ukravtodor #WorldBank #Weltbank #UkraineGDP #GDPUkraine #BIPUkraine #UkraineBIP #UkraineStrassenbau #UkraineBigConstruction #NBU #PPP #UkraineTender #TenderUkraine #UkraineHotels #McDonalds #TerryPickard #Pickard #ForceOneHotel #ForceOne #PickardRealEstate #JasperHenriksen #RadissonHotelGroup #Radisson #UZ #Ukrzaliznytsia #Rail.insider #UkraineRailfreight #RailfreightUkraine #Data.gov.ua #Ukrenergo #UkraineElectricity #Ukrstat #UkraineDeflation #ICU #Ukraineforcast #SergiyNikolaychuk #Nikolaychuk #UkraineIron #IronUkraine #UkrainePrivatization #PresidentHotel #HotelPresident #OdesaPortPlant #Electrotyazmash #KrasnolimanskayaCoalCompany #UnitedMiningandChemicalCompany #Facebook #SvetlanaPanaiotidi #Panaiotidi #InvestmenttoUkraine #UkraineInvestment #Covid19 #Coronavirus #UkraineEconomy #EconomyUkraine #SergiyMarchenko #Marchenko #TaxUkraine #TaxCommitteeUkraine #TimothyAsh #PrivatBank #Surkis #IMF #IWF #Anti-Surkislaw #Concorde #ConcordeCapital #AlexanderParaschiy #Paraschiy #Skyrizon #DCHGroup #AntimonopolyCommitteeofUkraine #MotorSich #ShanghaiStockExchange #BeijingXinweiTechnologyGroup #Unian #Klitschko #AirFrance #CDG #KBP #SXF #Ryanair #LOT #WAW #LWO #Eurobond #GDPwarrants #BankofAmericaSecurities #BofA #Hryvnia #Griwna #Fitch #RandI #R&I #Moodys #StandardandPoors #JPM #JP #JPMorgan #JPMorganChase #InterTV #DetailsoftheWeek #NationalAntiCorruptionBureau #UkrSATSE #Ukrainedomesticflights #PoltavaAirport #SumyAirport #RomanGrishchenko #KharkivAirport #VitalyBunechko #Bunechko #Boeing #Yanair #MuseumofCosmonautics #SergeiPavlovichKorolyov #Korolyov #HealthMinisteryUkraine #MaksymStepanov #Stepanov #ChinaRoadConstructionCorporationInternationalInvestment #Pivdennyi #GrainTerminalUkraine #OlgaStefanishyna #Stefanishyna #FanXianrong #Xianrong #kmu.gov.ua #uspa.gov.ua #TarasKachka #Grainmart #UkrainianGrainAssociation #Mriya #MriyaAgroHolding #Panamax #Salic #UkrainianContinentalFarmersGroup #GeorgvonNolcken #Continental #SaudiArabia #Naftogaz #Saakashvili #NationalReformCoucilUkraine #UkraineInvest #Varshalomidze #cfts.org.ua #BelarusIT #UkraineIT #ITUkraine #PoultryUkraine #DenisAleinikov #lowtaxIT #lowtaxITzone #ITRelocation #ITpark #ITprofessionals #MykhailoFedorov #Fedorov #Rada #Hi-TechPark #legalemployment #lowtaxrate #startupsUkraine #entrepreneursUkraine #ITjobsUkraine #KyivPost #Lukashenko #Kachanouski #Scootapi #UNIAN #China-Ukraine #Ukraine-China #PoultryWorld.net #Karpenko #SergeyKarpenko #UnionofPoultryBreeders #Gosprodpotrebzlyuzba #thepoultrysite.com #MHP #AgricultureUkraine #UnemploymentUkraine #RealwagesUkraine #Ukrainerealwages #Shmygal #UNIT.city #worldometers.info #moz.gov.ua #redzonecountries #Patriarch #UkrainianOrthodoxChurch #KyivPatriarchate #Tymoshenko #YuliaTymoshenko
#GesetzeUkraine #SteuernUkraine #TaxUkraine #AußenhandelUkraine #VolkswirtschaftUkraine #FinanzwirtschaftUkraine #LandwirtschaftUkraine #TransportUkraine #TourismusUkraine #InfrastrukturUkraine #EnergieUkraine #ErneuerbareEnergieUkraine #TelekommunikationUkraine #StartUpUkraine #AutomobilmarktUkraine #ArbeitsmarktUkraine #ITUkraine #HWCKyiv #HWC #UkraineBusinessSetUp #AccountingUkraine #OfficeKyiv #OfficeUkraine #PayrollUkraine #OutstaffingUkraine BüromietenKyiv #virtuellesBüroKiew #BüromietenKiew #OfficeSpaceUkraine #LegalAddressUkraine #ConsultingUkraine #GeneraldirectorfunctionUkraine #InterimManagementUkraine #BuchhaltungUkraine #LohnbuchhaltungUkraine #RetailUkraine #EinzelhandelUkraine