Business news from Ukraine

NON-CASH PAYMENTS IN UKRAINE 33% UP IN Q1 2016

KYIV. May 19 (Interfax-Ukraine) – Non-cash payments in Ukraine in January through March 2016 totaled UAH 115.325 billion, and increase of 33% year-over-year, the National Bank of Ukraine (NBU) said on its website.

As of April 1, 2016, total transaction using payment cards issued by Ukrainian banks exceeded UAH 332.05 billion and this was 21% up year-over-year. Cash payments of UAH 216.735 billion were settled using payment cards, and this was 15% up year-over-year.

The number of non-cash transactions as of April 1, 2016 reached some UAH 386 million or almost 70% of the total number of transactions with payment cards (UAH 274 million or 60% in Q1 2015). The number of transactions to obtain cash amounted to near UAH 166 million or 30% of the total number of transactions (UAH 157 million or 36% in Q1 2016).

As of April 1, 2016, the number of payment cards in issue exceeded 58.2 million, including 30.7 million active cards (81% with the debit functions and 19% with the credit functions).

The NBU said that cards with magnet stripes dominated (27.8 million), and cards with a stripe and a chip totaled some 2.8 million.

The number of noncontact payment cards increased by 42%, to 1.55 million.

The regulator said that the number of retail and service providing companies accepting non-cash payments grew by 7%, to 124,822.

In Q1 2016, the number of payment terminals increased by 8%, to 202,552.

The total number of ATMs totaled 33,552 as of April 1, 2016.

The highest figures in terms of the number of payment cards, ATMs and payment terminals are in Kyiv, Dnipropetrovsk and Kharkiv regions.

The leaders in the number of payment cards and infrastructure for their servicing as of April 1, 2016 were PrivatBank, Oschadbank and Raiffeisen Bank Aval.

AGRICULTURE MINISTRY OPENS CONSULTATION CENTER FOR EXPORTS OF UKRAINIAN AGRICULTURAL GOODS TO EU

KYIV. May 19 (Interfax-Ukraine) – Ukraine’s Agricultural Policy and Food Ministry has opened a center to support exports to the European Union (EU). The center will provide consultations to Ukrainian farmers about activities on the European markets.

The press service of the ministry reported that the center was opened as part of a joint project with Germany’s Federal Ministry of Food and Agriculture. Germany has invested EUR 1.5 million in the project.

The office of the project is located in the building of the ministry – 24, Khreschatyk, eighth floor.

“The services of the center are available both for those who sell goods to Europe and for those who only thinks about it. It is important that farmers will be able to get all basic information on exports issues at one place,” Agricultural Policy and Food Minister Taras Kytovy said.

WIZZ AIR MULLING EXPANSION OF OPERATIONS IN UKRAINE

KYIV. May 19 (Interfax-Ukraine) – Hungary’s Wizz Air low-cost airline is mulling expansion of its operations in Ukraine due to stabilization of the situation in the country.

“We see that the situation in Ukraine is being stabilized. We like what is happening there now from the business point of view,” Wizz Air CEO Jozsef Varadi told http://www.fly4free.com portal.

Commenting on this information, former infrastructure minister of Ukraine Andriy Pyvovarsky said that the main thing is to create equal conditions for everyone, and the market would dynamically develop itself if the economic situation stabilizes.

“Wizz Air expressed its desire to return to Ukraine as they see stabilization. How much time have I spent to explain to experts that the issue is with the economy, not politics? The invisible hand of the market is working. Adam Smith said this,” he wrote on his Facebook page.

Wizz Air’s fleet consisted of 67 Airbus A320 aircraft and two A321 aircraft based at 25 bases throughout Central and Eastern Europe. Wizz Air’s shares are listed on the London Stock Exchange.

Hungary’s low-cost airline Wizz Air carried over 395,000 passengers in 2015 from and to Ukraine, which is twice less from a year ago.

EBRD MAY LEND UP TO $20 MLN TO UKRAINE’S ASTARTA SUGAR PRODUCER FOR MODERNIZATION

KYIV. May 18 (Interfax-Ukraine) – The European Bank for Reconstruction and Development (EBRD) is considering a senior secured long-term loan of up to $20 million to finance the modernization, energy efficiency and environmental improvements of Astarta’s existing sugar processing plants.

The EBRD Board of Directors will decide on the disbursement on June 22, 2016, the EBRD has reported in an announcement on Tuesday.

“The transition impact of the project will be derived from demonstration of new replicable behavior and standards market expansion through BAT (Best Available Technique) implementation and obtaining ISO 50001 certificate, and transfer and dissemination of skills and innovation through new technologies.

Astarta Group is one of the largest vertically integrated agricultural companies in Ukraine, operating nine sugar plants, around 250,000 hectares of leased arable land, as well as dairy farms and engaged in soybean processing.

INDUSTRIAL PARK DEVELOPMENT COULD INCREASE OUTPUT OF CONSTRUCTION MATERIALS

KYIV. May 18 (Interfax-Ukraine) – The construction of industrial parks could contribute to production of construction materials in Ukraine for thermal modernization of buildings, the deputy head of the parliamentary committee on construction, urban development, housing and communal services, Petro Sabashuk, has said.

“Currently there is great demand for construction materials for thermal modernization of buildings in Ukraine, where domestic production does not meet the demand,” Sabashuk said at a meeting of the profile committee and industry organizations on May 16.

“Many reinforced concrete plants do not work. The creation of industrial parks on their basis will solve a number of problems, in particular the recovery of industrial production in the country in a modern format, manufacturing construction materials for thermal modernization, creating new jobs and the development of regions,” Sabashuk said.

Representative of Better Regulation Delivery Office (BRDO) Olena Shuliak believes it will be much cheaper to build industrial parks through reconstruction of non-operating plants than to create them from scratch.

“The availability of land for building industrial parks in Ukraine is limited. There are difficulties with land allocation. It is therefore very difficult in the short term to allocate cheaply land for industrial park construction. The cost of reconstruction would be much lower,” she said.

ZHYTOMYR, TERNOPIL, HLUKHIV SEEKING INVESTORS TO IMPLEMENT INVESTMENT PROJECTS

KYIV. May 18 (Interfax-Ukraine) – The mayors of Zhytomyr, Ternopil and Hlukhiv (Sumy region) have invigorated efforts to attract foreign investors to implement investment projects in their cities.

“We are well aware that during this [crisis] time it is impossible to count on any significant financial investment on the part of the state, therefore another option is to work with foreign investors,” Ternopil Mayor Serhiy Nadal said at an investment conference in Kyiv.

Zhytomyr Mayor Serhiy Sukhomlyn said the city plans in 2016 to raise $50 million for implementation of different small projects.

“$50 million is very little for us. These are the projects that allow Zhytomyr to survive. Unfortunately, we are not talking about large-scale infrastructure projects,” he said.

According to him, in particular, this is the construction of four thermal plants using biofuel: two of the projects, funded by Austrian and Swedish investors, are to be implemented in 2016. In addition, Chinese investors are interested in the projects: a framework agreement on cooperation has been signed with them. The project of building a hydroelectric power plant is being implemented together with Swedish investors in the current year. In addition, there are projects to construct four boiler rooms in schools for a total of $500,000.

According to the Zhytomyr mayor, loan and grant agreements worth EUR65 million have been signed over the past year and a half, of which EUR28 million was used for the development of heating systems and EUR26 million for water supply systems.

At the same time, he said the budget for the development of Zhytomyr for this year is $10 million, which is very little for a city with the population of 272,000 people.