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Business news from the Ukrainian League of Industrialists and Entrepreneurs

UKRAINE, BULGARIA AGREE TO JOINTLY BUILD FERRY ACROSS DANUBE

KYIV. July 7 (Interfax-Ukraine) – Minister of Foreign Affairs of Ukraine Pavlo Klimkin and his Bulgarian counterpart Daniel Mitov were on a working visit to Odesa region on Monday during which they discussed a project for repairing the Odesa-Reni highways and agreed on the joint construction of a ferry across the Danube.

Klimkin and Mitov preliminarily discussed the possibility of attracting EU funds under the said projects, according to Klimkin’s comment available to Interfax-Ukraine. This question will be also discussed at the presidential level during a meeting between Ukrainian President Petro Poroshenko and his Bulgarian counterpart Rosen Plevneliev, who is to come to Ukraine on an official visit, Klimkin said.

“Agreement was reached on joint construction of a ferry across the Danube, which would open the way from Ukraine to Romania and Bulgaria,” Klimkin said.

On the agenda were also the creation of a new business incubator for small and medium-sized enterprises, and cooperation in education and culture, he added.

“During the talks, the Bulgarian side has promised to raise the quota for the education of Ukrainian citizens of Bulgarian origin at Bulgarian universities,” Klimkin said.

UKRSPYRT TO DELIVER 300,000 DAL OF SPIRIT TO GEORGIA BY OCTOBER 2015

KYIV. July 7 (Interfax-Ukraine) – State enterprise Ukrspyrt plans to deliver 300,000 decaliters (dal) of molasses alcohol to Georgia by the end of September 2015.

According to a press release issued by the state-owned enterprise, Borschevsky distillery, which produces molasses alcohol for exports to Georgia, started operating in Ternopil region on June 20.

According to Ukrspyrt Acting Director Roman Ivaniuk, the approximate volume of alcohol for exports, according to the signed contract, is currently 300,000 dal.

“The next priority alcohol exports destinations are Austria, Poland and Bulgaria. The work is at the stage of signing contracts,” the company said.

As reported, Ukrspyrt plans by to export 2 million dal of spirit by the end of 2015.

Ukrspyrt is subordinated to the Ministry of Agricultural Policy and Food. In 2014, Ukrspyrt plants produced about 15 million decaliters of alcohol. The entire volume was sold in the domestic market.

EBRD COULD ACQUIRE STAKE IN RAIFFEISEN BANK AVAL – EBRD

KYIV. July 7 (Interfax-Ukraine) – The European Bank for Reconstruction and Development (EBRD) is considering investing in the share capital of PJSC Raiffeisen Bank Aval (RBA), Ukraine’s second largest bank with Western capital, to obtain a significant minor stake.

The EBRD Board of Directors plans to consider the proposal on July 22.

The proposed investment in Raiffeisen Bank Aval “will send a strong positive signal to the market during the period of severe political and economic crisis in Ukraine,” the EBRD said in a statement.

The cost of the EBRD’s investment in the bank has not been disclosed.

Raiffeisen Bank Aval was founded in 1992. It has around 670 branches across the country, serving nearly 3 million customers. At the end of May 2015 Raiffeisen Bank International (Austria) owned a 96.5% stake in the bank.

RBA ranked seventh among 133 operating banks in the country on April 1, 2015 by total assets (UAH 52.8 billion), according to the National Bank of Ukraine. Its charter capital stood at UAH 3.003 billion, net worth – UAH 4.105 billion.

AVTOKRAZ RAISES OUTPUT BY 20% IN JAN-JUNE 2015

KYIV. July 6 (Interfax-Ukraine) – PJSC AvtoKrAZ (Kremenchuk, Poltava region), the only Ukrainian producer of heavy vehicles, in January-June 2015 increased production by 20.5% from the same period in 2014, to 577 units.

According to the press service of the company, KrAZ sales in the first half of 2015 rose by 22.7%, to 519 units.

Of the total amount of vehicles produced exports accounted for 32%, the domestic market – 67%.

In addition to basic production, specifically trucks, in the first half of the year the plant shipped four semi-trailers and 13 trailers to the customer, while in January-June last year these products were not manufactured.

The report notes that in June the plant increased production by 30% from May this year and by 22.5% from June of the past year, to 125 vehicles, while in monetary terms production grew by 26.2%.

The press service also said that in late June the plant passed three mobile pumping units to Energoatom to be in keeping power units in a safe condition.

New KrAZ-63221 trucks are being manufactured in cooperation with Tital, a Ukrainian developer and manufacturer of fire and rescue vehicles and equipment.

The ultimate customer of these vehicles is Yuzhnoukrainsk nuclear power plant (Mykolaiv region).

UKRAINIAN COMPANIES TO EXPORT DUTY-FREE GOODS WORTH $200 MLN TO U.S. PER YEAR – TRADE MINISTRY

KYIV. July 6 (Interfax-Ukraine) – Ukrainian companies will be able to export duty-free goods worth about $200 million to the United States per year after the updating of the U.S. program, the Generalized System of Preferences, Minister of Economic Development and Trade Aivaras Abromavicius said at a press conference in Kyiv.

The minister said that Ukraine has not been involved in this program since 2013, but in the last year of Ukrainian participation, Ukrainian companies supplied goods worth $111 million under this program, and according to U.S.’ estimates Ukraine used a mere 65% of its potential.

“Based on this figure, we can calculate that duty-free goods supplies to the U.S. should amount to about $200 million,” he said.

As reported, the updated U.S. program of the Generalized System of Preferences, which allows duty-free exports of about 5,000 items of goods to the United States, will come into force from July 29.

 

MAJORITY OF EU STATES RATIFY UKRAINE-EU ASSOCIATION AGREEMENT IN A YEAR – POROSHENKO

KYIV. July 6 (Interfax-Ukraine) – Twenty-one out of the 28 member states of the European Union have already ratified the Ukraine-EU Association Agreement and four countries have launched ratification procedures, Ukrainian President Petro Poroshenko has said.

“Although it was previously supposed that the whole process would take more than three years, today, a year later, 21 of 28 EU countries have already completed the process of ratification and four countries are currently implementing this process,” Poroshenko said before talks with President of the European Parliament Martin Schulz in Kyiv.

The president stressed the importance of the synchronous ratification of this document by the Verkhovna Rada and the European Parliament a year ago.

“This step has significantly accelerated the procedure of ratification of the Association Agreement with EU states,” Poroshenko said.

In turn, Schulz said that the initiative on the joint ratification of the Association Agreement between Ukraine and the EU was down to Poroshenko.

“It is the only occasion of such large-scale synchronous ratification in history,” he added.