Ukraine open for business - Business news

Business news from the Ukrainian League of Industrialists and Entrepreneurs


KYIV. Nov 17 (Interfax-Ukraine) – The European Investment Bank (EIB) will issue a loan of EUR 130 million to Ukrenergo for modernization of substations, according to the website of the financial institution.
The corresponding project was approved by the financial institution on November 16.
The EIB said the project is aimed at improving energy efficiency, reliability of equipment, reducing operating costs. Its implementation will contribute to the integration of Ukraine’s energy system with the European Network of Transmission System Operators for Electricity (ENTSO-E).
The total cost of the project is EUR280 million.
As reported, Ukrenergo operates trunk and interstate power grids, as well as carries out the centralized dispatching of the unified energy system of the country. The company is a state enterprise subordinated to the Ministry of Energy and Coal Industry.


KYIV. Nov 17 (Interfax-Ukraine) – The League of Insurance Organizations of Ukraine (LIOU) backs the adoption of the bill amending the law on the specifics of insurance of agricultural products with government support (No. 6355), the authors of which are MPs Ivan Rybak, Hryhoriy Tymish, Mykola Liushniak and Anatoliy Kot (all from the Petro Poroshenko Bloc parliamentary faction), the LIOU has said on its website.
The LIOU believes that the implementation of the bill would provide for economic growth in agricultural production via the introduction of a transparent agricultural insurance tool as an effective tool for risk management, introduction of state planning and regular financing of subsidized agricultural insurance programs in Ukraine.
The LIOU opposes the creation of a state agency for agricultural insurance, as it is outlined in alternative bill No. 6355-1 of MP Fedir Nehoi (Petro Poroshenko Bloc). The league believes that it is inadmissible to elect a representative of the central executive power agency as chairman of the supervisory board of this agency, as this could result in the redistribution of the agricultural insurance market using non-market principles, entail administrative influence and other things.
The two bills were discussed at a meeting of the parliamentary committee for agricultural policy and land relations on November 14, 2017.


KYIV. Nov 17 (Interfax-Ukraine) – OTP Bank (Kyiv) has signed a cooperation agreement with Alfa Smart Agro, a manufacturer of plant protection products and micro fertilizers, in the field of lending to agricultural enterprises.
According to a bank press release, according to the terms of the program, agrarians can get loans from OTP Bank for the purchase of more than 60 types of plant protection agents produced by Alfa Smart Agro at a special rate of 12% per annum in the hryvnia. At the same time, a preliminary decision on financing is made within one day, while credit funds are available on the ninth working day.
The amount of financing can be up to UAH 8 million, and a pledge can be an agrarian receipt or a future crop, as well as the company’s assets.
“We are constantly working to expand the opportunities that Ukrainian agricultural producers can use in the framework of our strategic program of agro crediting OTP Agro-Factory. Now more than 40 farms have benefited from financing from OTP Bank, in particular to purchase raw materials through our partner programs,” head of the Agro-Factory project Ivan Yerko said.
According to him, OTP Bank together with the International Finance Corporation (IFC) implemented a simplified and accelerated approach to financing farmers under the Agro-Factory program, which provides farms that are engaged in growing grains and oilseeds and have the land bank from 500 hectares with access to money for sowing and harvesting campaigns.


KYIV. Nov 17 (Interfax-Ukraine) – Ukraine has huge deferred investment attractiveness, but political activity of the business is a necessary condition for changes in the country, said People’s Deputy of Ukraine Serhiy Taruta.
“We all understand that the Ukrainian business will rapidly develop if acceptable conditions are created for it: to conduct deregulation, curb the monopolists (energy, logistics, etc.), reduce the pressure of regulators and law enforcement agencies that are now actually engaged in raiding. Possibility to attract cheap long-term resources for investment is also needed,” Taruta said at the business forum titled “Level Up Ukraine 2017,” the press service of the MP informed.
He stressed that, according to Western experts, Ukraine has tremendous investment opportunities.
“When we presented the Ukraine-2030 Sustainable Development Doctrine in the Bundestag, ex-Minister of Finance Peer Steinbruck said that Ukraine has huge deferred investment attractiveness and all the necessary resources for development. We have worn out the whole infrastructure – energy, industry, logistics, and this is a huge space for attracting large-scale investments. But Ukraine needs to regain the confidence of investors to attract investment,” the MP said.
The politician also considers political activity of business as a necessary condition for changes.
“Businessmen usually stick to the position “politics is separated from business.” But in Western countries, business is more politically active. If the Ukrainian business is more politically active, then we will be able to restart the political system, which will lead to rapid positive changes in the country,” Taruta said.


KYIV. Nov 17 (Interfax-Ukraine) – The Infrastructure Ministry of Ukraine plans to start three reconstruction projects for 232 km of roads with cement surfacing in 2018. The project would cost around UAH 8 billion.
An Interfax-Ukraine correspondent has reported that the project was discussed at a meeting of the parliamentary transport committee.
The first project is reconstruction of the northern orbital road around Zhytomyr in Kyiv-Chop M-06 highway (22.3 km).
“It is planned to upgrade the road category to 1b [the extension of the road from two to four lanes, the estimated traffic intensity is 14,000 vehicles]. Land has already been allocated,” Director of the department for strategic development of the road market and road transport of the Infrastructure Ministry Viktor Sasin said.
According to the representative of the State Automobile Roads Agency of Ukraine (Ukravtodor) Andriy Chabanovsky, the cost of reconstruction will be UAH 1 billion. The project is financed from the loan provided by the European Bank for Reconstruction and Development (EBRD).
In addition, the investment project for reconstruction of the Dnipro-Reshetylivka N-31 highway provides for the expansion of the road from two to four lanes, as well as the coating in cement concrete (137 km), Sasin said. The cost of the project, according to Ukravtodor, is UAH 5.4 billion.
It is planned to carry out major repairs of the Kropyvnytsky-Mykolaiv N-11 highway, within the borders of Mykolaiv region (73 km), Chabanovsky said. Road coverage, according to the prepared project, is cement concrete. The project cost is UAH 1.6 billion, the works will begin in 2018.

Smart Energy owner Novinsky regards searches in company as pressure on opposition

KYIV. Oct 16 (Interfax-Ukraine) – Searches at the offices of Smart Energy and at the place of residence of its managers are conducted for far-fetched reasons with the aim of once again pressing on the opposition, the owner of the Smart-Holding, deputy from the Opposition Bloc, Vadim Novinsky, has stated.
“This way they are trying to influence me as a politician in some way. In addition, this is pressure on the opposition. This is another way to arrange economic raiding at the enterprises in which I am a shareholder,” he said on the sidelines of the parliament.
He stated that all his companies observe the law and are transparent, therefore “there is nothing to be afraid of.”
According to him, representatives of the tax police are in the offices of Smart Energy for “absolutely far-fetched reasons.” Novinsky added that his other companies are also subject to “huge repressive pressure” from other law enforcement agencies: the Security Service, the Prosecutor General’s Office and the Interior Ministry.
Smart Energy is a managing company in the Smart-Holding Group of Vadim Novinsky. It is responsible for the development of projects in the field of hydrocarbon production and alternative energy.