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  • Food to China, Trains from China
  • State Railroad and Postal Service Opening to Private Investment
  • Rada Passes Concessions Law for Ports, Airports, and Roads
  • PrivatBank Looms as IMF Dealbreaker
  • To Counter Currency Nervousness, Central Bank Sells $200 million

China, Ukraine’s largest trading partner, is opening up to imports of new agricultural products from Ukraine, stating with canola, a grain used for cooking oil, according to Olena Kuryata, head of international cooperation for Ukraine’s Food Safety and Consumer Protection Service. Ideally, canola exports will start this year. She tells agroportal.ua that China also is considering for next year: apples, blueberries, chickens, sweet cherries, eggs, fish products and honey.

Ukraine’s future role as rail transit country for Chinese goods to Central Europe was reaffirmed Wednesday by the arrival from China of a 44-car freight train at Dobra, Slovakia, just across the border from Chop, Zakarpattia. Carrying Chinese goods for Austria, Hungary, Slovakia, and the Czech Republic, the train took 14 days to travel to Slovakia from Xi’an, in central China. Slovakia wants to win 50% of all railway traffic between Europe and China, writes  RailFreight.com. With the collapse of eastern trade with the former Soviet Union, Slovakia has the capacity to handle 25 additional container trains from China, estimates Slovakia’s Ministry of Transport and Construction.

Due to geography, the shortest and fastest route to Slovakia is through Ukraine. Transport through Ukraine was more than competitive [than Belarus and Poland], as transit time was some 32 hours,” Martin Koubek, Silk Road director for Metrans, a Prague-based railroad, told RailFreight.com. “We see big potential in this route.” Noting that Ukraine’s new government is upgrading customs procedures to EU standards, he said: “From this perspective, it may become even easier to transport trains via Ukraine.”

As winter approaches, Russia is blocking shipments of thermal coal to Ukraine via Belarus, reports Liga.net, citing Mikhail Volynets, chairman of Ukraine’s Independent Trade Union of Miners. “The situation of filling coal depots of thermal power plants on the eve of winter was already unsatisfactory,” he writes on Facebook. “Now it will become disastrous.” Due to Russia’s new coal export permit system, coal stocks are 62% of last year’s levels or 1 million tons short, warns Andriy Gerus, chair of the Rada’s Energy Committee. DTEK is importing 388,000 tons of coal. In recent weeks, four shipments from Colombia arrived at Pivedenii (Yuzhne) port.

With the Rada’s abolition of the list of state companies that cannot be privatized, the state railroad and postal service are now open for strategic foreign investors, officials say. “This means that we will be able to attract the funds necessary for the implementation of the development strategy from the world’s largest investors,” Yevhen Kravtsov, CEO of Ukzaliznytsia writes on Facebook, referring to the state railroad’s 5-year, $6 billion spending plan. “An IPO is our strategic goal for the next few years.”

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Alluding to exploratory talks with China’s Alibaba to invest in Ukrposhta, Infrastructure Minister Vladislav Krykliy writes on  Facebook: “Strategic objects will remain with the state holding at least  50 %+ 1 shares, but we will now be able to actively work on finding strategic investors Who know maybe it will be one of the biggest e-commerce giants or international financial organizations.”

The Rada gave final approval Thursday to a concession bill that allows for private investment in roads, ports, airports and other hitherto public infrastructure projects. Under preparation for two years, the new bill replaces four often conflicting laws on public-private partnerships.

Private companies may start building the first toll roads next year, says Infrastructure Minister Vladyslav Krykliy. Working with companies with experience working with toll roads in Europe, the Ministry plans to start with small pilot projects – the Kyiv-Bila Tserkva highway and the Lviv-Krakovets highway. The law stipulates that toll roads must compete with parallel free roads.

In the first three months of the 2019/2020 season, Ukraine has increased grain exports by 49%, to 13.6 million tons, compared to the same July-September period last year. The big driver was wheat: up 61% y-o-y, to 8.6 million tons. On Thursday, the government replaced wheat export caps with monthly monitoring by the Economy, Trade and Agriculture Ministry, reports Reuters.

Less than one week after leaving the government, Oleksandr Danilyuk warns that the threat of returning PrivatBank to Ihor Kolomoisky is the main reason why the IMF team left Ukraine last Friday without a staff-level agreement. The fact they left without a final agreement is a very negative signal – and it is a pity that it happened only because of a problem with PrivatBank,” Danylyuk, former head of the National Security Council, tells BBC Ukraine. Danyluk who served as Finance Minister 2016-2018, adds: “No IMF, means no investment, no further privatization, all that gives impetus to the economy. Then what can we say about the 40% [promised growth] over the next five years?”

After a 3-day, 3.2% drop in the hryvnia, the central bank intervened Thursday for the first time in two months, selling $200 million. Drawn from $20 billion in reserves, the sale stopped the currency’s slide at 25.6 hryvnia to the dollar. The sale of dollars came after the National Bank of Ukraine bought $930 million in September. Since the beginning of this year, net purchases of foreign currency amounted to about $3.7 billion, slightly more than the $3.4 billion in foreign investment in Ukraine’s local currency government bonds.

  • Poland’s ‘Quota Wars’ on Truck Permits Threaten Ukraine-EU Trade
  • Shakeups at Railroad, Ports
  • Bond Demand Drops

A lack of permits for cross-border trucking may limit Ukraine’s future trade growth with the EU, Vitaliy Kravchuk warns in a study, EU road transport quotas are limiting trade expansion with Ukraine. Trucks account for 38% of Ukraine’s exports to the EU and 81% of its imports, writes Kravchuk, a researcher at Kyiv’s Institute for Economic Research and Policy Consulting.

Trucking permits for Poland are to be used up this month. Permits for France, Italy, and Romania were used up by August. Last year, Ukraine’s truck permits for Austria, France, Germany, Latvia, Netherlands, Poland, and the Czech Republic were exhausted by December. With rail a slow and costly alternative, he writes: “Time-sensitive orders may be canceled altogether.” Despite Ukraine’s free trade pact with the EU, he says: “The caps on the number of permits act as a form of non-tariff trade barrier intended to support the carriers of the issuing country.”

Poland is creating “quota wars” to pressure Ukrainian truck drivers to emigrate to Poland to work for labor-short Polish trucking companies, Infrastructure Minister Vladislav Krykliy tells the European Business Association in Kyiv. “The Polish side created the conditions for quota wars because [drivers] who are unable to work in Ukraine are re-registered in Poland,” he said. “So our drivers have crossed into Poland, work for Polish companies and pay taxes in Poland.”

Ukraine’s Prime Minister Oleskiy Honcharuk tells reporters: “We have already prepared countermeasures.” Noting that he plans to talk this week with Poland’s Prime Minister, Mateusz Morawiecki, he says:  „I really hope that our Polish colleagues will hear our arguments and this problem will be solved.” Already struggling with a labor shortage, Polish employers worry that Ukrainian workers will fly over Poland next year to take advantage of a new German law allowing immigration of skilled non-EU citizens.

In a step toward a mass sale of ailing state companies, the Rada has voted to abolish a list of companies not eligible for privatization. In a bid to use private money to modernized Ukraine’s rocket industry, the Rada has voted to open the space industry up for private investment.

The Sea Ports Authority plans to reduce its number of employees by 30%, reports Raivis Veckagans, head of the state company. Since 2016, the Authority has cut its staff by 800 employees by outsourcing noncore manufacturing units to private companies. Now, through mergers of units, the Authority plans to eliminate duplicate functions. The authority runs Ukraine’s 12 ports, on the Black Sea and Azov Sea.

Traveling to Mykolaiv, Infrastructure Minister Vladislav Krikliy fired the director of the Mykolaiv port, the third busiest on the Black Sea. Without going into detail, he said prosecutors are investigating the director, Sergey Mitchenko. On Tuesday in Odesa, the minister fired the directors of three Odesa region Black Sea ports – Bilhorod-Dnistr, Chornomorsk, and Odesa.

With larger and larger ships docking at Ukraine’s Black Sea ports, the government plans to triple the number of berths with 15-meter depths, from five today to 15 in 2024. The new five-year plan envisages a modest 10% growth for sea cargo, to almost 150 million tons by 2024. The plan also calls for rebuilding the locks on the Dnipro and for doubling river cargo freight, to 20 million tons. The Rada is to pass an inland waterways bill this fall.

At least half of the state railroad’s top management are to be fired by Christmas, Yevhen Kravtsov, CEO of Ukrzaliznytsia, tells BusinessCensor. “Many people from middle and senior management are not the most transparent in terms of reputation and decisions,” he said. “At least half of the management team will be replaced.” Offering an opportunity for a shakeup, the railroad is to be split next year into three companies – freight, passenger and infrastructure.

Over the next five years, UZ plans to buy or renovate 200 locomotives, 800 passenger cars, 10 Intercity electric trains and 5,000 km of track, the government reports. In a pilot project, public-private partnerships are to be used to modernize three trains stations: Kyiv, Mykolaiv and Zaporizhie.

Sales of hryvnia government bonds at Tuesday’s weekly auction plummeted to the lowest level of the year – $3.2 million, less than 1% of the $541 million sold the week before. The drop was attributed to sale of short term bonds 3-month, 1-year, and 2-year. The earlier auction offered 5-year bonds, popular among investors. Tuesday’s auction also marked the start of trading on Bloomberg terminals, a shift that could have caught some bidders unprepared. Despite the low volume, the Finance Ministry depressed yields slightly, to the range of 15.09% to 15.75%.

Concorde Capital’s Evgeniya Akhtyrko writes: “Such a dramatic drop in receipts from the weekly bond auction comes as a big surprise… These results show that the situation at the primary bond market is very shaky…the government might face difficulty with financing the budget deficit if auction receipts remain low.”

Ukraine’s bonds hit a five-week low Wednesday, Reuters reports, citing questions about key reform efforts, PrivatBank, and the influence of Ihor Kolomoisky on the government. A selloff saw the 2032-maturing dollar-denominated bond drop 1.4 cents and 2020-2028 bonds drop between 0.5% to 0.8%.

  • Metinvest Places Nearly $1 billion in Eurobonds
  • ’Jihad’ on Corruption: 3 Black Sea Port Directors Sacked
  • Market to Push up Farm Land Prices
  • Nova Poshta Maps Overnight Deliveries to 500 Ukrainian Cities
  • Tom Cruise Scouts Kyiv

Metinvest, the steel and mining giant, has placed $500 million worth of 10-year Eurobonds at 7.95% per annum and €300 worth of 5-year Eurobonds at 5.75% per annum, reports Interfax-Ukraine. Total demand was $1.1 billion for the equivalent of $828 million of bonds. Before a weeklong international roadshow that ended Friday, Metinvest said: “The purpose of the offer is proactive management of debt repayment, an extension of debt repayment terms and reduction of refinancing risks.”

The Finance Ministry aims to upgrade Ukraine’s credit rating from ‘B’ or ‘speculative’ to ‘A-‘ or ‘investment grade’ by 2024, according to the government’s 5-year program posted on rada.gov.ua. The Ministry promises to introduce an agency for state debt management, make state debt paper more liquid, reduce the foreign currency portion of state debt to 50% (from 66% today) and cut the state debt to GDP ratio to 40% (from 58% today).

In a morale boost for the central bank, Ukraine’s President, Prime Minister and Ministers of Economy and Finance visited the National Bank of Ukraine on Tuesday, drawing applause from staffers. Two weeks ago, the bank denounced attacks on former bank governor Valeria Gontareva as ‘terror.’ Zelenskiy did not address the attacks, but said: “The National Bank of Ukraine was, is and will be independent – we stand for this.”

By launching a farmland market one year from now, agricultural productivity will increase by 6% a year, according to estimates by the new Ministry of Economic Development, Trade and Agriculture. Over five years, farm land rents will more than double, rising from UAH 1,700 per hectare today to UAH 4,000 in 2024.

Reflecting strong demand for Ukrainian farmland, bidders paid $435,277 for land leases on Monday, almost four times the initial asking amounts, reports Ukrinform. For SETAM, the government electronic auction platform, it was a record amount of bidding for one day. Designed to start setting market prices for land, open auctions started one year ago.

Declaring a ‘jihad’ on corruption in the Black Sea ports, the new Infrastructure Minister Vladislav Krikliy, fired on Tuesday three Odesa region port directors – Odesa, Chornomorsk, and Belgorod-Dnistr. He charged ed that Viktor Voitko, Odesa city port director, Vearned one of Ukraine’s highest state company salaries – $216,000 a year – while presiding over plummeting revenues. Founded in 1794, the “Pearl of the Black Sea” has been tarnished by corruption in the post-Soviet era, falling this year to fourth place in trade volumes for Ukraine’s ports.

About 170 representatives of 46 foreign and Ukrainian companies attended a high-level information session on Ukraine’s first seaport concessions: for Olbia and Kherson ports. Infrastructure Minister Krikliy predicted in Odesa on Tuesday that these two pilot concession projects will be “the basis for creating a conceptually new approach” to public-private partnerships in Ukraine in the 2020s.

Nova Poshta, the delivery company, says it will record the second year of 20% growth in 2019, hitting 200 million parcels delivered to 8 million customers. To reach this goal, the company is expanding its offices this year to 6,200, half of them in villages. Nova Poshta is halfway through a 2-year to build six high-speed sorting centers. On Sept. 20, a $10 million sorting center was opened in Lviv. Equipped with Dutch Vanderlande machinery, the Lviv center can sort 250 parcels a minute.

“Next Morning” is Nova Poshta’s planned service to offer overnight deliveries for packages sent among Ukraine’s 500 cities. On Sept. 5, Nova Poshta started nightly cargo flights between Lviv and Dnipro. Carrying parcels with a maximum weight of 1 kilo, the flights are performed by Eleron, using cargo versions of An-24 turboprop planes. Alexander Bulba, director of Nova Poshta, says: “Our task is to connect all the cities of Ukraine, there are about 500 of them, within a day.” For Kyiv, Nova Poshta is talking with Boryspil and Sikorsky (Zhuliany), but is considering creating a cargo hub at another airport in the region.

To bring financial services to the ‘un-banked’ portion of Ukraine’s population, Ukrposhta, the state postal company, has installed Verifone terminals for cashless payments to 5,000 post offices – all settlements with populations over 2,000. The next step for Verifone, a California-based company, will be to allow cash withdrawals from the terminals. The goal is to “bring Ukrainians closer to financial services and basic financial services,” said Igor Smelyansky, CEO of Ukrposhta, the state postal company. He said only two-thirds of Ukrainians live near bank branches, while access to post offices is universal.

The central bank has started printing 1,000 hryvnia notes for release on Oct. 25. Currently, worth $42, the banknote features Volodymyr Vernadskyi, a Ukrainian philosopher, naturalist and the founder of the Ukrainian Academy of Science in 1918. The last banknote denomination to be introduced was the 500 hryvnia bill, introduced in 2006. On the low end, 1, 2 and 5  kopiyka coins stopped being valid for cash settlements on Tuesday. They will be withdrawn and melted down for scrap.

Radisson Blu Hotel inaugurated Tuesday an 8 million renovation of its 255 rooms, receptions and lobby bar. The first makeover since Radisson opened in 2015 comes as the hotel has had “one of our best Septembers ever,” says Jesper Henriksen, Kyiv director for Radisson Hotel Group. Karl-Maria Pfeffer, CEO of the building owner, Vienna-based Raffeisen Property International, said low airfares is making Kyiv a popular European travel destination.

With discount air travel to Kyiv booming, Monotel the “first network of futuristic capsule hotels in Ukraine” has opened two capsule hotels in Kyiv’s historic center – at Taras Shevchenko Boulevard, 9/28, near the Premier Palace,  and at Bogdan Khmelnitskogo Street, 58a, near the City Hotel.  With prices starting at $42 a night, each hotel has male and female capsules, capsules for couples, 24-hour reception, separate women’s and men’s showers, laundry, personal lockers, Wi-Fi and charging for gadgets. Breakfast is $6.

US actor Tom Cruise met Zelenskiy Tuesday, giving a boost to the Ukrainian actor president’s effort to promote Ukraine as a film making destination. Zelenskiy told Cruise that the Rada recently passed a law to give tax incentives to foreign companies to film here. Cruise said he is scouting locations: “We’re looking, we’re seeing, we’re very excited about it.”

  • Government Moves to Legalize Gambling
  • Privatization, Investment, and Liberalized Labor Laws to Create Jobs
  • Kernel Offers $300 million in Eurobonds
  • EIB to Provide €900 million to Rebuild Ukraine’s Busiest Highway

The Cabinet of Ministers has approved a bill to legalize gambling in hotels in Ukraine. The version that goes to the Rada in coming days restricts gambling to high-end hotels and only “on gaming equipment using software that meets international standards.” “We want slot machines to disappear from the streets,” said Prime Minister Honcharuk. It is not clear if the average Ukrainian gambler will want to gamble in luxury hotels. President Zelenskiy wants the law adopted within two months. The government predicts gambling will draw $100 million in tax revenue next year.

Ukraine plans to liquidate over 1,000 inefficient state companies and to sell hundreds more to private investors, according to the draft of a privatization bill posted on the Rada website. “We will promote the development of the private sector, which is more productive and efficient than the state one,” reads the bill, according to NV.ua. The goal is to reduce the state’s share in the economy to 5% by the end of Zeleneskiy’s term, in 2024. The government also plans to attract investors to state-owned banks, to cut the state share in the banking sector to 20%, from over 50% today.

Prime Minister Honcharuk says Ukraine needs to attract $50 billion in investment in the next five years to ensure 40% GDP growth.This is not an exorbitant figure, it is big, ambitious, it is much larger than the one we are attracting now, but it’s quite doable,” he told journalists at a briefing on the government’s economic development plan. To reach the 40% goal, Ukraine’s GDP should grow by 5% in 2020 and continue rising by at least 7% per year in 2021-2024. From 2016 to 2018, Ukraine’s GDP grew by 40%, from $93 billion to $131 billion, according to World Bank figures compiled by Trading Economics.

With new investment and liberalized labor laws, the new government plans to create 1 million legal jobs and to cut the unemployment rate to 5% – in line with Poland, Romania and Moldova. Due to a combination of economic growth and labor migration, Ukraine’s unemployment, as measured by the State Statistics Service, has fallen from 9.9% in 2017, to 8.8% in 2018, to 7.8% in the second quarter of this year.

Kernel Holding SA plans to hold a conference call with investors to place $300-350 million in Eurobonds, reports Interfax-Ukraine. On Wednesday, there will be a presentation in London and New York. The organizers are JP Morgan and ING. Kernel plans to place either 5-year Eurobonds with a call option after three years or 7-year Eurobonds with a call option after four years.

Fitch Ratings raised the long-term issuer default rating of Kernel on Monday, from B + to BB-, with a stable outlook. Kernel, the world’s largest sunflower producer, now has a rating two levels higher than the sovereign. In June, Kernel completed its fiscal year with a net profit of $189 million – 3.6 times more than in the previous fiscal year. Revenue increased by 66% – to $4 billion, and EBITDA – by 55%, to $346 million.

Three weeks ago, another Ukrainian agro giant, MHP placed 10-year-Eurobonds for $350 million with a coupon of $6.25. Metinvest, the steel maker, plans to place new 8-10 year Eurobonds.

“Ukraine’s Chicken Farmers May Be Next to Gain From China Demand,” headlines Bloomberg about Ukraine looking east after doubling poultry exports since 2015. A Chinese poultry inspection team is expected to tour Ukraine’s poultry farms shortly. Rabobank estimates China lost half of its pig herd over the past year to African swine fever. Yuriy Kosyuk, MHP CEO, tells Bloomberg: “They will start to consume more and more chicken.”

“Ferrexpo rushes to defend chief against prosecutor’s social media claims” headlines the Financial Times about a Ukrainian prosecutor issuing a ‘notice of suspicion’ for Konstantin Zhevago, CEO of the LSE-listed iron mining company. The notice suspects Zhevago of involvement in the embezzlement of about $100 million from Finance & Credit bank, what was declared insolvent in 2015. Zhevago controlled the bank which held a major chunk of Ferrexpo cash.

President Zelenskiy accepted the resignation Monday of national security council secretary Oleksandr Danyliuk, a reformer with a strong following in Western business circles. As Finance Minister in 2016, Danyliuk pushed for nationalizing PrivatBank, the bankrupt bank partly owned by Ihor Kolomoisky. In the Zelenskiy government, Danyliuk clashed with Andriy Bogdan, the former Kolomoisky lawyer who is now presidential chief of staff.

The Zelenskiy administration will not restore air flights with Russia, but will retain freight and passenger rail ties, Infrastructure Minister Volodymyr Krikliy tells Ekonomicheska Pravda. He noted that passenger trains to Russia are among the few profitable routes for Ukrzaliznytsia. As for cargo, through July, the railroad earned $146 million carrying 7.7 million tons on Russia routes. On air flights, he said the July 2014 shootdown of MH17 makes air links too dangerous as long as fighting continues between Ukraine and Russia. “It’s simply dangerous for Ukrainians,” he said of flights between the two countries. “We must have some kind of suicidal attitude to suggest restoring this air link.”

The two expanded checkpoints at the Crimea line of control will serve as bus stations dispatching buses north to Ukrainian cities and airports, says Infrastructure Minister Volodymyr Krikliy. From Kalanchak, on the west side of the isthmus, buses will go to Kherson city and Kherson International Airport. SkyUp airlines estimate that one-third of its Kherson passengers are Crimea residents. From Chonhar, on the east side, buses will go north to the train station at Melitopol and the airport at Zaporizhia. For legal reasons, there will be no bus service across the temporary line separating Crimea and Kherson. He said: “It’s about creating civilized conditions for passengers who can get on a bus of a legal Ukrainian carrier at the station near a checkpoint and continue to travel through Ukraine.”

European banks will provide €900 million for the repair of Ukraine’s busiest highway, the 453 km Kyiv-Odesa road, says Slavomir Novak, the outgoing head of Ukravtodor, the state highway agency. “We were able to complete negotiations with European banks, with the EIB and EBRD, and Ukraine will receive 900 million for the overhaul of Kiev-Odesa, raising this road to autobahn category,” he tells Hromadske. Next spring, he says, work should start on the road, Highway M05.

  • IMF Chokes on PrivatBank and Central Bank Independence
  • Finance Ministry to Auction Only Hryvnia Bonds This Fall – and to Move to Bloomberg’s Trading Platform
  • 5-Year, $10 Billion Rail Plan

Threat of a return of PrivatBank to its former owners and an end to the independence of the central bank were the two main worries of the IMF team which left Friday without reaching a staff agreement on a new program. “PrivatBank and NBU independence,” Kateryna Roshkova, deputy governor of the National Bank of Ukraine, told reporters Friday at ICU’s Ukrainian Financial Forum. Noting that the IMF had 37 meetings with the central bank during two weeks, she said their concern over “liquidated banks applies not only to PrivatBank, but also to other large bankrupt banks, whose owners have big issues with the state.”

The IMF end of mission report says the team “underscored the importance of central bank independence and safeguarding financial stability, as well as the need to make every effort to minimize the fiscal costs of bank resolutions.” Both sides said talks will continue. Rozhkova predicted that an agreement will be reachable by the IMF Annual General Meeting in Washington in mid-October.

From London, Timothy Ash is less optimistic, writing: “My sense here is that the Fund will want resolution of the Privatbank issue in the courts and/or a much firmer statement…in support of the nationalization of Privatbank and central bank independence…by Zelenskiy himself before signing on the dotted line for a new Extended Fund Facility. At the moment Zelenskiy seems far too close to Kolomoisky and his team for everybody’s comfort.”

To accommodate the China traffic, Belarusian Railways completed this month a $10 million, 150% expansion of its rail car processing at its Brest North station. To cross the rail break between Soviet and European gauges, each car has to be lifted off the tracks for a wheel change. The number of containers crossing this Belarus-Poland gauge break is to grow from 350,000 this year to 500,000 next year. Ukrzaliznytsia wants to develop Kovel, the Volyn rail hub 130 km south of Brest, as a rail alternative for the booming China trade.

S&P Global upgraded Ukraine’s sovereign debt on Friday to B from B-, following a similar upgrade three weeks earlier by Fitch. “The country’s economy is recovering and the debt-to-GDP ratio is declining,” wrote Standard & Poor’s. “The agency notes that Ukraine should maintain access to domestic and international capital markets, which will allow the country to repay its commercial borrowings through 2020.”

Prime Minister Honcharuk wrote of the S&P upgrade on Facebook: “Confidence in Ukraine in the world is gradually being restored…This means cheaper resources and potentially lower debt servicing costs.”

Ukraine plans to place only hryvnia bonds this fall, suspending auctions of the dollar and euro-denominated bonds, Yuriy Butsa, the government’s representative for public debt management told ICU’s Ukrainian Financial Forum.“Our goal in the future is to switch to exclusively hryvnia borrowing in the local market,” he said, noting that half of the funding this year was in hryvnia. With the government needing only $2 billion to get through this year, it will also suspend issuing five-year bonds, he said. Instead, the weekly Tuesday auctions will be for 1-2-3-year bonds.

To sell more hryvnia bonds and to expand the international investor base, the Finance Ministry will offer government bond auctions via Bloomberg‘s Auction System. “Improved transparency and investor awareness should have a positive impact on the expansion of the investor base, and increase the share of national currency in the state debt,” Butsa, the Public Debt Commissioner, said in a statement posted Friday on the National Bank of Ukraine website Nicholas Bean, Bloomberg’s Global Head of Trading Venues said: “Bloomberg’s solution provides an optimal, cost-effective and secure way to manage operations for primary markets for issuers who would otherwise have to conduct a manual process.” No start date was given.

Priority for rail investment should be: unblocking bottlenecks at the Black Sea ports, building logistics terminals at the western rail hubs for exports to the EU, and buying new locomotives. These are from the five-year, $10 billion investment plan set out by Anton Sabolevsky, Ukrzaliznytsia director of strategic development.  Talking to KM, the Cabinet of Minister‘s information site, he said public concessions to private companies to run rail stations have “very high payback potential.” The government plans to divide the state railroad into three companies: passenger, freight and infrastructure.

Ukrzaliznytsia is doubling its rail purchases – to 70,000 tons in 2020 – to upgrade 507 km of track next year. Despite this massive purchase, probably from Metinvest’s Azovstal plant in Mariupol, the track only amounts to 2.5% of the state railroad’s massive 20,000 km network. Earlier this year, the railroad closed 1,857 km of track due to poor conditions and low levels of freight. Despite these closures, speed limit warnings have grown by 35% over the last two years, to cover 339 sections of track, reports the Center for Transportation Strategies.

The original English version is from our partner UBN – Ukraine Business News. For more information and news archive, go to: www.ubn.news.