Business news from Ukraine


KYIV. May 23 (Interfax-Ukraine) – Ukrainian Agricultural Policy and Food Minister Taras Kutovy has presented the three plus five strategy for developing the agricultural sector to parliament.

“There are three key directions we want to focus on: the land reform and transparent land turnover, the second – the government support reform and focus on small and medium farmers, and the third – the reform of state-run enterprises, increase of their profits, efficiency and their privatization if we see that this is the sole effective way of development,” he said speaking in parliament on Friday.

The core five vectors of the ministry’s operation are linked to the development of rural areas, expansion of sales markets, organic production and niche crops, irrigation, safety and quality of foods (the launch of the effective operation of the State Service for Food Safety and Protection of Consumer Rights).


KYIV. May 23 (Interfax-Ukraine) – The European Union (EU) and the European Bank for Reconstruction and Development (EBRD) will provide up to EUR 28 million for business advice, information, training and other support to small and medium-sized enterprises (SMEs) in Ukraine as part of the EU4Business initiative.

The agreement was signed on May 20 by First Deputy Prime Minister and Economic Development and Trade Minister Stepan Kubiv, EU Ambassador Jan Tombinski and Head of EBRD operations in Ukraine Sevki Acuner.

The EBRD will assist with the creation of a network of business support centers, in addition to using existing business support structures to establish operations in 15 regions of Ukraine. In addition to the current EBRD offices in Kyiv and Lviv, the latter now focusing on activities to support SMEs, new offices will be opened in Kharkiv in the east and Odessa in the south, widening and deepening the EBRD’s outreach and reflecting the importance that the Bank and the EU attach to the development of small private firms across the country.

It is also envisaged that up to EUR 12 million of EU4Business funds will be used to support the EBRD’s direct financing of smaller enterprises. At least 50 SMEs are expected to be financed directly by the EBRD through a dedicated credit line worth EUR 100 million.

“Today’s agreement paves the way for more development opportunities for Ukrainian SMEs. Advisory and financial support provided by the EU and the EBRD will make these companies stronger and more competitive domestically and internationally. The opening of two new offices and the development of a network of business support centers across the country also reflects our commitment and attention to supporting Ukraine’s economic growth,” Acuner said.

The funding is part of the wider EU4Business initiative which includes access to finance for Ukrainian SMEs, as well as significant technical assistance to the Ukrainian government to support deregulation and the implementation of sound policies to support the private sector.

“The EU4Business initiative aims to support job-creating Ukrainian businesses by equipping small and medium-sized companies with new skills and supporting their ambitions to export to the largest neighbouring market – the EU Single Market of more than 500 million consumers. We are teaming up with the EBRD, our longstanding partner, to significantly increase our support for small businesses in Ukraine and to help a variety of firms benefit from the opportunities available under the EU-Ukraine Deep and Comprehensive Free Trade Area (DCFTA). We are determined to help local businesses become drivers of economic growth in the Ukrainian regions and compete successfully in global markets,” Tombinski said.


KYIV. May 23 (Interfax-Ukraine) – Ukrainian President Petro Poroshenko has met with his Slovak counterpart Andrej Kiska on the sidelines of the UN World Humanitarian Summit in Istanbul, where the sides exchanged views important bilateral relations and international cooperation.

“They also discussed issues related to the creation of an East European gas hub with the participation of other countries in the region,” the Ukrainian presidential press service said on Monday.

“The two leaders emphasized the two countries’ algorithm of interaction in the direction of European integration in the context of Slovakia’s EU presidency in the second half of 2016,” it said.

“The point at issue was, in particular, practical assistance by the Slovak side in reforming the Ukrainian economy, as well as Slovakia’s support of decisions by the EU’s governing agencies on visa-free travel for citizens of Ukraine,” it said.

What is more, Poroshenko and Kiska considered ways to enhance trade and economic cooperation between the two countries. “In this regard, they noted the importance of this year’s scheduled meeting of the intergovernmental Ukrainian-Slovak commission on economic, industrial, research and engineering cooperation,” the press service said.

The Ukrainian president also thanked the Slovak leader for backing Ukraine’s position on inadmissibility of the North Stream 2 project.


KYIV. May 20 (Interfax-Ukraine) – Chinese Cofco has invested $75 million in the launch of a grain terminal in Mykolaiv region.

Interfax-Ukraine reported that the terminal was launched on May 19.

“Danube Navigation and Stevedoring Company, part of Ukraine’s Cofco Agri, with China’s Cofco as the key shareholder has opened a new grain and oilseed handling complex on berths one and two of Mykolaiv maritime merchandise port. Construction lasted 20 months – since August 2014.

“Average annual handling volumes at the terminal are 2-2.5 million of products,” Director General of Ukrainian Constructor building company Andriy Dmytrenko told reporters.

He said that the terminal started operating in the test mode in April 2016 and handled six ships for exports (around 150,000-160,000 tonnes of grain).

Dmytrenko added that 95% of the terminal’s equipment is imported.

The new terminal has two grain storage facilities with 16 silos (total capacity is 120,000 tonnes) and four silos (over 1,500 tonnes). The complex has stations for unloading trucks and railway wagons. The stations can process up to 10,000 tonnes of products a day.

The terminal has a grain dryer and a grain purifier with a capacity of 50 tonnes per hour.


KYIV. May 20 (Interfax-Ukraine) – Israeli GIZA Ventures Capital that has invested around $600 million in 106 projects via five venture funds over 22 years is mulling the creation of a separate fund to invest into Ukrainian venture and IT projects.

The founder and head of GIZA Ventures Zeev Holzman said at the New Ukraine investment conference in Kyiv this week that the partner of the company in the project is Ukraine’s Empire State Capital Partners (Kyiv) that organized the conference.

“The target of our future fund for venture projects is $20 million for the first closure. Then we seek to reach $50 million,” Managing Director and Head Capital Markets & Institutional Sales Department at Empire State Capital Partners Alex Bart told Interfax-Ukraine.

He said that the fund soon would start helping the development of the venture and IT eco-system in Ukraine.

Holzman proposed to Ukrainian authorities at the conference that up to 10 funds with seed capital starting from $30 million to invest in venture projects with foreign companies as partners should be created in Ukraine. He said later investors could buy the state-owned shares that could be up to 50%, with a markup.

He said that this program showed large efficiency in Israel and it would be helpful for the development of the domestic IT market and expanding its share of the global IT market.

Holzman said that GIZA Ventures has 14 active projects. The fund had 43 successful withdrawals from projects via selling them or holding an initial public offering (IPO) on exchanges. Among these projects are XtremIO (acquired by EMC), Soluto (Asurion), Actimize (NICE Systems), Prosight (Primavera Systems), Oplus (Intel), Precise (IPO NASDAQ, Veritas), Oridion (IPO Zurich, Covidien pending), Zoran (IPO NASDAQ, CSR), M-Systems (IPO NASDAQ, SanDisk), DSPG (IPO NASDAQ), Butterfly and Libit (TI), DSPC (IPO NASDAQ, Intel), Scorpio (US Robotics) and Telegate (Terayon).

Empire State Capital Partners is a full service investment company with Western roots headquartered in Ukraine. The company offers services in capital markets advisory, mergers and acquisitions, debt and equity underwriting, corporate finance, brokerage, asset management and structured products.


KYIV. May 19 (Interfax-Ukraine) – Ukraine’s State Aviation Service seeks to regulate safety of flights of unmanned aerial vehicles (UAVs).

The authority has designed a draft concept for rules and procedures providing safety of flights of general aviation, sports, amateur and unmanned aerial vehicles and posted it on its website.

According to the document, it is linked to the appearance of new types of aircraft, including those remotely controlled.

The UAVs will be certified with a document covering all elements required for servicing the controlled flight. The core criteria for classification of UAVs as followed: the flight weight, performance radius, control method and kinetic energy when UAVs bump into an obstacle.

UAV external pilots have similar liabilities as pilots of aircraft.

The authority proposes that the external pilot certificate is designed with all required skills and restrictions.

The introduction of the new type of the airspace user aims at cutting risks for all airspace users.

The authority intends to create a special UAV division.