Foreign direct investments in the economy of Ukraine in the III quarter of 2021 (operations, $ million)
NBU
Milk production in 2022 due to the military invasion of the Russian Federation will be reduced by 13.3-15.9%, to 7.33-7.56 million tons from 8.73 million in 2021, the depth of the crisis in the industry will be determined by further development hostilities in the country and their geography, the profile association “Union of Dairy Enterprises of Ukraine” (SMPU) reported.
“It is unlikely that with the current development of the military situation, the decline in the production of raw milk will exceed 17%. Such a decrease will not lead to a critical reduction in the supply of dairy products on the domestic market, since the share of consumption reduction due to the migration factor is 18-20%,” – indicated in the forecast on the website of the organization on Friday.
She recalled that since the beginning of the Russian invasion, more than 4 million citizens of Ukraine have left the country, and about 10 million have moved to safer regions. This significantly reduced the demand for dairy products in the country, especially given the almost complete halt in its exports. Thus, due to the departure of some citizens, the average per capita consumption in Ukraine in 2022 will increase by 8% – from 212 kg in 2021 to 229 kg this year.
“For the dairy industry, the first days were also a shock: several international companies closed their milk processing plants, the established logistics schemes for the delivery of raw milk were violated, agricultural enterprises had nowhere to deliver raw milk. Farmers changed routes on the go, milk was delivered where the situation permitted, many raw materials were simply given away for free,” the SMPU clarifies.
At the same time, the enterprises that continued to work changed the range of their products to the most in demand in the conditions of martial law: butter, cheese, milk powder, long-term storage milk. In addition, such enterprises massively donated their products to feed the Ukrainian army, humanitarian supplies and other charitable purposes.
The SMPU clarified that the assessment of the prospects for milk production in Ukraine is becoming more difficult not only because of the uncertainty of the capabilities of farms and processing plants in the territories of active hostilities with Russian occupiers. Important factors that negatively affect milk production are problems with logistics (sales, delivery of feed, veterinary drugs, etc.) and a reduction in the number of cows directly in the combat zone.
“It should be noted that in the regions that are under temporary occupation (Kherson, Mykolaiv regions, the southern part of Zaporozhye) – the volume of milk production was not significant before, which was taken into account in the forecast calculations made by the SMPU,” the organization clarified in the message.
As SMPU previously reported, after the recession of the economy caused by the Russian invasion, 60-65% of milk processing enterprises have already resumed work, which, even in the conditions of hostilities, are able to provide the domestic market, taking into account the migration of part of the population abroad.
The National Bank of Ukraine (NBU) will soon consider some relaxations regarding foreign exchange operations, said the head of the National Bank of Ukraine (NBU) Kyrylo Shevchenko.
“I think that in the near future we will consider some concessions regarding foreign exchange transactions. In principle, we are already doing them,” he said in an interview with Economic Truth.
The head of the NBU added that today the difference between the official rate and the rate on the black market has begun to narrow quite significantly compared to what it was at the beginning of the war.
“If at the beginning of the war we saw in exchangers that the exchange rate fluctuated around UAH 40/$, today the average cash market rate is 31.63-32.05 UAH/$. This is not a very wide spread and this makes us happy”, he pointed out.
As reported, on February 24, the National Bank suspended the work of the foreign exchange market of Ukraine, except for the sale of foreign currency, and fixed the rate at the level of February 24.
The growth of consumer prices in Ukraine in March 2022 accelerated to 4.5% from 1.6% in February, 1.3% in January and 0.6% in December, the State Statistics Service (Gosstat) reported on Friday.
In March last year, inflation was 1.7%, so in annual terms, in March this year, it rose to 13.7% from 10.7% in February and 10% in January, the agency said.
Core inflation also jumped to 3.8% last month from 1% in February and 0.1% in January. Taking into account 1.7% in March 2021 in annual terms, it increased to 10.5% from 8.2% in February and 7.6% in January.
Since the beginning of this year, for its first quarter, inflation was 7.6%, base – 4.9%, said the State Statistics Service.
The National Bank of Ukraine, as its head Kirill Shevchenko said in an interview with Ekonomicheskaya Pravda, estimated inflation in March at 2.1%, in annual terms – 11.1%, and the base – 8.5%, indicating that deviations from the pre-war forecast (respectively 9.2% and 8.2%) – moderate.
According to the State Statistics Service, prices for food and non-alcoholic beverages rose by 6.2% in the consumer market in March. Most of all (by 21.3% and 15.5%) rose in price fruits and vegetables. Prices for rice, cereal products, sugar, lard, sunflower oil, fish and fish products, pasta, butter, milk, cheese and eggs, soft drinks, meat and other products increased by 9.8-3.5%.
Clothes and footwear went up by 13%, incl. clothing – by 13.3%, footwear – by 12.5%.
The increase in prices (tariffs) by 0.5% for housing, water, electricity, gas and other types of fuel was mainly due to an increase in prices for rental housing by 4.0%, maintenance and repair of housing – by 2.2%.
Prices in the healthcare sector rose by 5.6%, primarily due to an increase in the cost of pharmaceutical products by 8.1%.
The 4.2% increase in transport prices was mainly due to a 7.7% increase in fuel and oil prices.
As reported, in 2021, inflation in Ukraine rose to 10% from 5% in 2020 and 4.1% in 2019, the core inflation to 7.9% against 4.5% a year earlier.
Since the beginning of Russia’s armed aggression in Ukraine, hryvnia deposits of the population have grown by 19%, while deposits in foreign currency have decreased by 2%, said the head of the National Bank of Ukraine (NBU), Kyrylo Shevchenko.
“As for the outflow of deposits, on April 1, compared to the first day of the war, hryvnia deposits of the population increased by 19%. Deposits in foreign currency decreased by 2%,” he said in an interview with Economic Truth.
Shevchenko added that since the beginning of the active phase of the war, the funds of legal entities have decreased by 4% – in hryvnias and by 8% – in US dollars.
“We have no critical outflows from the system,” the head of the NBU summed up.
Indian pharmaceutical companies – members of the Indian Pharmaceutical Manufacturers Association (IPMA) donated about UAH 60 million worth of medicines to Ukrainian clinics and public organizations for free, continue their work in Ukraine, IPMA told Interfax-Ukraine. According to a press release, Indian pharmaceutical companies donated mainly antibiotics, analgesics, hemostatic, antiallergic, tonic drugs and vitamins.
In particular, Dia Pharma donated medicines worth UAH 1.818 million (antibiotics and hemostatic drugs – hemostatics) to hospitals, Dr. Reddy’s donated medicines worth UAH 14.7 million UAH to the Ministry of Health. The Euro Lifecare/Konark company (Euro Lifecare) donated medicines worth almost UAH 5.79 million to hospitals, the volunteers of this company daily deliver medicines and food to those in need in Kharkiv and the region.
Pharmaceutical company “Hetero” (Hetero) donated drugs (antibiotics and antiallergic drugs) in the amount of UAH 4.58 million to hospitals in Kyiv through the state institution “Public Health Center”. Macleods Pharmaceuticals donated medicines (antibiotics, analgesics, hemostatic drugs) worth UAH 26.26 million to the Public Health Center in the capital. Mega Lifesciences donated medicines (analgesics) worth UAH 400,000 to hospitals.
Pharmaceutical company “Organosyn” (Organosyn) donated medicines worth more than UAH 2.891 million to hospitals.
Sun Pharma donated medicine (analgesics, antibiotics, gastroenterological drugs) worth UAH 3.3 million. Ukrainian hospitals. In addition, Sun Pharma Romania donated $500,000 to public organizations in Romania to help people coming from Ukraine.
The report also states that the company “Abryl Pharm” (Abryl Pharm), together with volunteers, works in Kyiv and daily delivers food, medicine and medical supplies to soldiers. The M.Biotech company, in cooperation with a public organization (charitable foundation) in Ukraine, plans to supply humanitarian cargo from India with medicines, including anesthesia, tranquilizers and hormonal drugs.
Also, volunteers from IPMA participants (“Abril Pharm”, “San Pharma”, “Konark”) are engaged in the delivery of food, medicines and other necessary materials that the military at checkpoints and people evacuated from the places of hostilities need. For their part, “Euro Lifecare” and “Konark” organized transport to evacuate people to the western regions of Ukraine.
Commenting on the work of Indian pharmaceutical companies in Ukraine since the beginning of the war, IPMA noted that Indian pharmaceutical companies remain on the Ukrainian market. Work continues, in particular, on the provision of humanitarian assistance, the work of managers and warehouses for servicing and shipping orders to distributors. Also, work is underway with clients and doctors in the western and central regions of Ukraine, where there are no hostilities, assistance is provided in hospitals in Kyiv.
“Companies are adjusting to new realities – the military situation in the country. In connection with the movement of employees to other regions of Ukraine, they work online, jobs are saved and companies hope to resume their previous work in peacetime,” the association said.
She also noted that the companies are shipping to distributors from warehouses in Ukraine and are looking for new import routes through western borders.
At the same time, IPMA still finds it difficult to assess the damage caused by the Russian aggression against Ukraine.
“Given that the war is still going on in its “hot phase”, it will be possible to estimate the damage approximately only after the situation stabilizes,” the association stressed.
