Business news from Ukraine


Reikartz Hotel Management (Kyiv), the managing company of the Reikartz Hotel Group national hotel chain, has signed an agreement to manage the first hotel in Kremenchuk (Poltava region), Ontario Hotel, at 15 Mazepy Street.
“In February 2018 we started the integration of Ontario Hotel into the Reikartz network under the new name Reikartz Kremenchuk,” the Reikartz press service reported, with reference to company operational director Andriy Dema.
According to him, at present the hotel has 16 rooms of different categories. It is planned to increase the number of rooms to 30.
As reported, in 2017 two hotels were withdrawn from the management of Reikartz: the four-star Dacia in Chisinau (Moldova, joined the network in November 2016), and the four-star Dostyk in Shymkent (Kazakhstan, joined the network in December 2016). The reasons for the withdrawal of the hotels from the network are unknown.
Reikartz started its activity in the sphere of hotel services in Ukraine in 2003 after a group of Belgian architects, led by Francois Ryckaerts, had bought an old mansion in Drukarska Street in the center of Lviv.


Ukrainian freestyle skier Oleksandr Abramenko has won the gold medal in the men’s aerials at the Winter Olympics in Pyeongchang (South Korea). China’s Jia Zongyang took the silver and Olympic Athlete from Russia (OAR) Ilia Burov won the bronze.
This is Ukraine’s first medal at the Olympics in Pyeongchang. Abramenko has already received congratulations from Ukrainian President Petro Poroshenko, Prime Minister Volodymyr Groysman, as well as the General Staff of the Ukrainian Armed Forces (Abramenko is a representative of the Central Sports Club of the Ukrainian Armed Forces).
The 23rd Winter Olympic Games are held in Pyeongchang from February 9 to February 25.


Japan is to provide Ukraine with $3.6 million for humanitarian needs to support vulnerable parts of the population and restore eastern regions of the country, Japanese Ambassador to Ukraine Shigeki Sumi has said.
“Japan will provide nearly $4 million in 2018,” Sumi said on Monday during a press conference.
He said the money would be spent on radio equipment for the Interior Ministry, the rebuilding of housing, purchase of medical equipment and training for persons from eastern regions of the country.
The ambassador said most of the money would not be spent on humanitarian assistance, but would be used for the rebuilding.
The assistance will be used to finance seven projects implemented by the United Nations in Ukraine, including the International Organization for Migration, the UN Development Program, the office of the United Nations High Commissioner for Refugees, UNICEF, the UN Office for Project Services, and the World Health Organization.
Neal Walker, the UN Resident Coordinator and Humanitarian Coordinator said the help would be provided in the following areas: employment, environmental protection, potential development, and the safety of citizens.
Walker said most of the assistance would be sent to eastern Ukraine.
According to Ukraine’s Regional Development, Construction and Housing Minister Hennadiy Zubko, Japan currently helps Ukraine with the implementation of a large-scale project for the renovation of Kyiv’s Bortnychi sewage treatment plant. What is more, a mission of Japan International Cooperation Agency (JICA) is scheduled to visit Ukraine on February 21 to conduct talks on waste disposal projects in Kyiv, Dnipro and Kharkiv.


The UN Food and Agriculture Organization (FAO) distributed 50 drip irrigation kits to small farmers in conflict-affected Donetsk and Luhansk regions on February 16. 2018. According to a press release of FAO, the kits were distributed in the villages of Bolotene and Orlovske in Luhansk and Donetsk regions respectively. The two villages are located within eight kilometers of the contact line and both are short of water for irrigation.
Each beneficiary farmer will receive a full irrigation kit – designed for kitchen garden or orchard irrigation – complete with high-capacity water tank, drip lines, drip tapes, filters, hose and tubing, sprinklers, sprayers, and valves. Each kit is custom-made and can be utilized for a variety of crops. Water flow can be precisely controlled and deposited at the base of the plant, maximizing the water’s effects and minimizing waste.
Coordinator of FAO’s emergency response programme in Ukraine Farrukh Toirov said that drip irrigation is not just an additional means of increasing efficiency, but one of the most important components of modernizing agricultural practices. FAO experience shows that this technology can more than double the incomes during the first year of proper use, he said.
“There are about 2.8 million hectares of farming land in the Lugansk and Donetsk regions, but the irrigation infrastructure is old and often not operational,” he said.
FAO’s emergency programme in eastern Ukraine is financed by the governments of Canada and France, as well as by FAO’s own resources.


Ukrainian President Petro Poroshenko has said that at the moment more than a dozen world-famous companies had expressed their desire to participate in the management of the Ukrainian gas transportation system (GTS). “Over a dozen world-famous companies have already expressed desire to participate in this process,” he told reporters in Munich.
In addition, the president noted the government has already made appropriate decisions.
“And when we define the range of companies that will be able to provide gas transit, ensure an efficient modernization of the gas transportation network and provide the most benefit to the Ukrainian state in the operation of the gas transportation system, the best company will win. I am sure that very much was done in that direction,” Poroshenko said. “A great work was carried out. Naftogaz hired a consultant who is preparing a proposal regarding the transparent management of the gas transportation system of Ukraine in full compliance with international rules,” the head of state said.


Moldova’s Purcari Wineries Public Company Limited (earlier Bostavan) saw a rise in wine sales in Ukraine in January-September 2017, to RON 3.29 million ($870,000), the company has said in a prospectus for the initial public offering (IPO) posted on its website.
According to the document, sales of more expensive wine under Purcari trademark grew by 54.2%, to RON 1.8 million.
Purcari said that these results became possible thanks to the economic recovery in Ukraine, the growing popularity of wine in the region and the increase in the share of organized retail trade.
The company said that in the reporting period Ukraine accounted for 5% of its sales in bottles and in money terms – 4%, while in 2016 – 4%.
According to the prospectus, in 2014-2016, the average annual reduction of the wine market in Ukraine was 1%, while the markets for strong alcoholic beverages and beer fell by 19.1% and 13.9%, respectively.
Purcari said that the consumption of wine in Ukraine – 4 liters per year – is way below the neighbors: Poland – 6.4 liters, Slovakia – 14.9 liters, Romania – 16.4 liters, the Czech Republic – 20.5 liters, not to mention such countries as Italy – 33 liters and France – 43 liters.
The company, citing Euromonitor data in the prospectus, expects an average annual growth of the wine market in Ukraine in 2016-2020 by 2.9% compared to the growth of the beer market by 1.1%.
Euromonitor estimated the wine market in Ukraine in 2016 a 168 million liters, or EUR600 million with a share of premium and super premium brands of 25%. The leading companies were three companies: Logos (the Inkerman brand) – 13.4%, Bayadera (Koblevo) – 12.1% and Shabo 10.2%.
Experts also said that the share of dry wines in 2016 was 54% in bottles and 40% in money, sparkling wines – 32% and 28%, fortified – 13% and 30% respectively.
Purcari said that the average annual growth of its cash sales in Ukraine in 2014-2016 was 9%, while in bottles, a decline by 11% was recorded. The company mainly relies on third-party distributors to cover the market, but it directly delivers wine to Fozzy Group, one of the largest supermarket chains in the country.
“The Group’s near-term strategy is to focus on building out the Purcari and Bostavan brands in this large, high-potential market and expanding its presence to the sparkling segment, with particular focus on the HoReCa segment, navigating a structurally changing industry following the annexation of Crimea, which accounted for circa a half of Ukraine’s vineyards,” the company said in the prospectus.