The macroeconomic aid of EUR 1.2 billion the European Commission has decided to propose to Ukraine will be disbursed at two installments, Ukraine’s envoy to the EU Mykola Tochytsky told Interfax-Ukraine in Brussels on Wednesday.
The first EUR 600 million will be allocated unconditionally, immediately after adoption by the European Parliament and the Council of the EU, and the other EUR 600 million will be extended under some specific conditions, which the EU and Kyiv will begin negotiating in the near future, Tochytsky said in commenting on the European Commission’s decision to distribute EUR 1.2 billion in emergency macro-financial assistance to Ukraine to limit the economic fallout of the coronavirus pandemic.
“The first tranche of EUR 600 million will be provided unconditionally and the second upon Ukraine’s compliance with criteria to be agreed upon with Kyiv within the next few months,” he said.
Asked what these criteria could be, Tochytsky pointed out that no specific talks on the matter have been started so far, but, judging by the criteria set for other similar agreements concluded earlier between Kyiv and Brussels, these could be some measures related to public finance administration, anti-corruption efforts, taxation, labor and social protection, business climate, customs, and so on.
“Apart from the EU, there is no other association of countries that could provide a similar amount of assistance not only to its members but also to other partners. We are grateful to our European partners for their extremely timely and significant support for our economy, business and population,” he said.
In procedural terms, the provision of this EUR 1.2 billion emergency macro-financial assistance by the European Commission is “only the beginning,” as it has yet to be adopted by the European Parliament and the Council of the EU, Tochytsky said. “Simultaneously, negotiations will proceed on signing a relevant memorandum between Ukraine and the EU, which will be subject to ratification by the Ukrainian Verkhovna Rada after its signature. In other words, this is a lengthy process,” he said.
The European Union provides macro-financial assistance only to its partners that successfully cooperate with the International Monetary Fund (IMF), Tochytsky said. “This is a general condition. Therefore, the disbursement of the last, the fourth, tranche of the fourth macro-financial assistance program, which was endorsed back in September 2018, as well as the second tranche of the present emergency macro-financial assistance, depends on the passage by the parliament of the so-called banking bill in an edition agreed upon with the IMF,” he said.
Considering this, the Ukrainian diplomat said he expected that the fourth installment of EUR 500 million will be disbursed in the first half and the EUR 600 million of the emergency assistance in the second half of the year.
Apart from this, the EU decided on April 8 to offer Ukraine an aid package in the amount of EUR 190 million, Tochytsky said. “These resources, in particular, will be allotted for helping the people living in the areas that suffered from Russian aggression in the eastern part of the country. This includes EUR 30 million as so-called technical assistance for the Ukrainian healthcare system, which implies not only the procurement of the necessary equipment and supplies but also for upgrading [the medical personnel’s] qualification and facilitating the Health Ministry’s legislative work,” he said.
Another EUR 45 million is to be spent on a program of support for small and medium-sized businesses and the already existing programs, and some part of this sum will also be offered as easy loans, including those denominated in hryvnias, Tochytsky said.
This assistance also includes EUR 10 million for a state administration support program, and some funds will also be provided to non-governmental organizations, he said.
As another example of EU’s financial assistance to Ukraine, Tochytsky mentioned the allocation of EUR 13 million of humanitarian aid disbursed on April 16. “This tranche will be spent not only on fighting coronavirus but also on other needs, such as, for example, water supply restoration,” he said.
The Board of the National Bank of Ukraine has decided to cut the key policy rate from 10% to 8%, the NBU said in a statement on Thursday.
“Together with other measures taken by the NBU, such as expanding its set of liquidity support tools and the introduction of preferential terms for borrowers by banks, this will provide the economy with the impetus required to provide support for households and businesses in these difficult times, and to ensure that business activity picks up quickly once the quarantine is lifted,” the NBU said.
The NBU expects that the key policy rate to be reduced further, to 7% in the current year.
“In deciding how quickly the key policy rate can be decreased to that level, the NBU will take into account how talks with the IMF progress, how the coronavirus pandemic develops, how quickly quarantine measures are lifted, and what anti-crisis measures other governments and central banks adopt,” the central bank said.
The NBU leaves open the possibility of a greater easing in monetary policy if a fall in consumer demand due to quarantine measures and weaker business activity put stronger downward pressure on inflation than is currently expected.
President of Ukraine Volodymyr Zelensky is initiating the creation of a state airline, whose fleet will be formed from aircraft manufactured by Antonov state-owned enterprise, he said this in the film “The Year of President Zelensky,” broadcasted by Ukraine 24 TV Channel.
“Antonov is a large enterprise with a large number of jobs. Not a single aircraft has been built in recent years. I do not understand why our planes do not fly on domestic flights. Where are our ANs (aircraft manufactured by Antonov state concern)? We agreed with them, now we are developing a program, and we will do it. We have to create a state airline. It is my dream to create a state-owned modern airline at the level of Turkish Airlines or Singapore Airlines. The state is ready to allocate money for this,” he said.
Zelensky noted that in this way the state would not only create a national airline, but would also provide orders to Antonov state aircraft concern, creating additional jobs.
National bank of Ukraine’s official rates as of 23/04/20
Source: National Bank of Ukraine
Official rates of banking metals from national bank as of April 23
One troy ounce=31.10 grams
Vodafone Ukraine (PrJSC VF Ukraine) in 2019 saw a 45% rise in net profit compared with 2018, to UAH 2.54 billion, explaining the figure by growth in expenses on active development of 4G and 3G networks.
Vodafone Ukraine CEO Olha Ustinova said that the company’s income last year grew by 25%, to UAH 15.98 billion and Operating Income Before Depreciation and Amortization (OIBDA) rose by 21% year-over-year, reaching UAH 8.3 billion.
Vodafone Ukraine CFO Natalia Shevchenko said that in 2019, the operator doubled the number of 4G towers to 7,200. On average, the Vodafone data client uses almost 5 GB of traffic per month.
In general, the company’s investment in infrastructure development since the start of construction of high-speed mobile Internet networks amounted to UAH 25.4 billion.
According to information released during the presentation, as of December 31, 2019, the Vodafone chain in Ukraine included 629 mono-brand stores, of which 249 are own and 380 are dealerships. Sales revenue in 2019 amounted to $17.7 million, which is 4.6 times more than in 2018.
In 2019, the number of Vodafone customers in the country amounted to 19.7 million. The operator’s 4G network covers 69% of the country’s territory, which is 1.5 times more than the previous indicator for 2018.
According to the results of 2018, Vodafone Ukraine, the second largest mobile operator in Ukraine, reduced its net profit by 18.1% compared to 2017, to UAH 1.777 billion with an 8% increase in revenue, to UAH 12.8 billion. The company explains this figure as an increase in expenses due to the active deployment of 4G and 3G networks.
