Business news from Ukraine

Business news from Ukraine

RADA RATIFIES AGREEMENT WITH EUROPEAN COMMISSION ON UKRAINE’S JOINING CREATIVE EUROPE PROGRAMME

KYIV. Feb 4 (Interfax-Ukraine) – The Verkhovna Rada has ratified an agreement between the Ukrainian government and the European Commission on Ukraine’s joining the Creative Europe programme.

A total of 244 lawmakers backed bill No. 0077 on Wednesday.

According to the explanatory note to the bill, the Creative Europe programme is the European Union programme for the cultural and creative sectors and Ukraine and the European Union will cooperate in the MEDIA sub-programme.

The implementation of the agreement envisages the creation of the national bureau of the Creative Europe programme in Ukraine. The bureau will accompany the implementation of the program in Ukraine, analyze the impact of the programme on development of the Ukrainian cultural and creative sectors, conduct events aimed at spreading knowledge about modern trends in the Creative Europe programme and other EU programmes (conferences, seminars, training and other events).

Deputy Prime Minister and Minister of Culture Viacheslav Kyrylenko said presenting the bill in the parliament, soon a tender to select a head of the bureau will be announced.

 

AGRICULTURAL COMPANIES INVEST BILLIONS OF HRYVNIAS IN DEVELOPMENT OF FACILITIES AT UKRAINIAN SEAPORTS IN 2015

KYIV. Feb 4 (Interfax-Ukraine) – Some agricultural companies invested billions of hryvnias in the development of facilities at Ukrainian seaports in 2015, according to a report of the Cabinet of Ministers published on its website.

Noble Agri (China) used around UAH 500 million to realize a project on building a grain terminal in the rear part of berths 1 and 2 at Mykolaiv seaport.

Bunge (the U.S.) invested around UAH 1.7 billion in construction of a modern grain terminal and a seed crushing plant in the rear parts of berths 13 and 14 of Mykolaiv seaport.

Brooklyn-Kyiv LLC (Louis Dreifus, France) is building a grain terminal in the rear part of berth one of Odesa seaport. The Ukrainian Sea Port Authority is implementing a project on construction of berth 1-z for general cargos. Brooklyn-Kyiv raised $60 million from the European Bank for Reconstruction and Development to create the grain complex with an annual capacity of 4.5 million tonnes.

HPC Ukraine (Germany) is the operator of a container terminal on the Quarantine Mole of Odesa seaport and the investor in its expansion. Total investment in the project is UAH 5.18 billion. The construction will be finished in 2018. At present, the readiness of the project is 61.5% and UAH 3.192 billion has been used.

In 2015, state-run enterprises managed by the Infrastructure Ministry of Ukraine and companies investors signed several memorandums of intent. On July 19, 2015, a memorandum of intent was signed between Illilchivsk Maritime Merchandise Port and Soufflet Negoce S. A. The memo envisages investment in construction of a new terminal on one of the port’s berths. Total investment will be up to $100 million.

On August 13, 2015, a trilateral memo of cooperation between the Ukrainian Sea Port Authority, MV Cargo LLC and AT Cargill on the joint realization of affiliated projects on building a grain handling terminal with berth 25 and the creation of a working water area near the berth 16 meters deep. Total investment is planned at some $130 million.

Then the memorandum of intent was signed between Oktiabrsk Sea Port and public joint-stock company ArcelorMittal Kryvyi Rih. The document announces joint actions and development of cooperation in the sea transport and metal exports area.

ASTARTA EXPORTS PRODUCT WORTH $120 MLN IN 2015 – TENTATIVE DATA

KYIV. Feb 4 (Interfax-Ukraine) – Astarta agro-industrial holding exported products (grain, soybean products, sugar and heifers) tentatively worth some $120 million, Astarta CEO Viktor Ivanchyk said in Kyiv on Wednesday.

He said that in January-September 2015 the exports share of total sales was 38%. Soy oil and grain are exported by over 90%. The company exported around 30,000 tonnes of sugar in 2015.

He said that currently Astarta is actively working on boosting sugar exports to the EU as there is a shortage of sugar on the European market. In 2015, Astarta exported 10,000 tonnes of sugar to the EU.

“The quota for sugar exports by Ukraine to the EU is 20,700 tonnes. The counter quota is up to 30,000 tonnes. The EU has a chance to supply more sugar to our territory than Ukraine to the EU. Ukraine produces some 1.5 million tonnes of sugar and the EU – over 15 million tonnes which is 10 times more… The huge EU market today faces a shortage. We could cover it, supplying fairly and proportionally to the size of the market. They have ten times more market – give us ten times more quota, 200,000-250,000 tonnes,” he said.

Ivanchyk said that these issues are raised before the government and parliament by nongovernmental and sector organizations, although there is no feedback.

He said that the company is also interested in the markets of the Middle East, North Africa, Southeast Asia, in particular, China, Japan and South Korea.

“India is also an interesting market for us, they did not have a good harvest, and I’m sure that wheat will go there in the near term,” he said.

Astarta does not export its products to the Middle Asia (Kirgizstan and Kazakhstan), Georgia.

“Our government does nothing for opening the markets in Afghanistan, Iran and Iraq. These markets could seriously expand geography of exports. We fail to develop the market with Turkey. They have large opportunities for developing public private partnership by Ukraine,” he said.

Ivanchyk said that Astarta is working with Chinese companies on signing contracts to export corn. China has distributed the quota, but the contracts will be signed after New Year holiday in China starting from February 15, 2016.

UKRTATNAFTA ANNOUNCES FULL SWITCH TO EURO-4, EURO-5 FUEL

KYIV. Feb 4 (Interfax-Ukraine) – Public joint-stock company Ukrtatnafta (Kremenchuk oil refinery, Poltava region) has announced the full switch to production of fuel meeting Euro-4 and Euro-5 standards.

“According to the new requirements of the technical regulations, Ukrtatnafta started bulk production of fuel meeting new standards… The company has switched to production of Euro-4 and Euro-5 petrol DSTU 7687:2015 and Euro-4 and Euro-5 diesel fuel DSTU 7688:2015,” the company’s press service reported.

At present, Ukrtatnafta produces A-92 Euro-4-E5 and A-95 Euro-4-E5 petrol and diesel fuel DT-L-Euro-4-V0, DT-Z-Euro-4-V0, DT-Ark-Euro-4-V0, DT-L-Euro-5-V0, DT-Z-Euro-5-V0, DT-Ark-Euro-5-V0.

Ukrtatnafta also said that last month the company changed its sales strategy, returning to wholesale trading.

EUROPEANS POSITIVE ABOUT MORE CIVIL SOCIETY IN UKRAINE

Delegations of such EU countries as France, Germany, Poland, representatives of the European Parliament, the European Commission, who gathered in the Polish city of Lodz to discuss closer integration and further development with the Ukrainian side, have positively evaluated the efforts made by the Ukrainian non-governmental sector to stimulate the process of reform in the country. This was the subject of the presentation of the large-scale “Transformation of Ukraine” National Platform, which was introduced by co-founder of the initiative, President of the Ukrainian League of Industrialists and Entrepreneurs (ULIE) and Chairman of the Anti-Crisis Council of NGOs Anatoliy Kinakh at the 9th Europe-Ukraine International Forum.

This National Forum, which has accumulated a large number of proposals and social resources within a short period of time, aims to build a democratic state, introduce a European development model in the country. It brought together representatives of all branches of power and civil society in Ukraine, clergy, international organizations from the EU Member States and G7 countries. The forum also enjoys great support of foreign partners from the Baltic States, Central and Eastern Europe.

The ULIE actively involves its international partners ‒ MEPs, the largest European business association BUSINESSEUROPE ‒ in the development of this platform. Related meetings were held by industrialists and entrepreneurs in Brussels late last year.

Participants in the Forum have long been cooperating with peers from Poland, in particular, they are currently engaged in the development and implementation of an approach to using Polish experience in the country’s transformation in line with EU standards.

The European partners, who attended the presentation, including the former European Commissioner for Enlargement and European Neighbourhood Policy (February 2010 through October 2014) Štefan Füle and Head of the EU Delegation to Ukraine, Ambassador Jan Tombinski and others, shared Kinakh’s opinion that the National Forum has all the resources to become an effective instrument of interaction between society, the president, the parliament, the government of Ukraine and the international community to foster the transformation, support the developed, strong national economy and ensure sustainable development.

Two meetings of the “Transformation of Ukraine” National Forum have already been held. They defined priorities and outlined tasks for 2016. These are the fight against corruption, the creation of conditions for the rule of law and equality before the law, energy security, social policy, the development of local government, innovation policy as well.

UKRAINIAN ENTERPRISES BEGIN TO INTRODUCE RESOURCE-EFFICIENT PRODUCTION TEHNOLOGY

Ukrainian experts have assessed the implementation of a project to promote adaptation and implementation of resource-efficient and cleaner production in Ukraine. This task is performed by the Center for Resource-Efficient and Cleaner Production. The project has been launched in cooperation between Ukraine and the United Nations Industrial Development Organization (UNIDO).

Chairman of the advisory board of the project, Vice-President of the Ukrainian League of Industrialists and Entrepreneurs Vasyl Krutov stresses that the need for enterprises to widely incorporate resource-efficient practices has arisen due to demand for energy independence.

According to the World Economic Forum (WEF), Ukraine has got “stuck” at the 70th-80th positions of the Global Competitiveness Ranking in the past decade. One of the factors which seriously limit the competitiveness of both individual companies and the economy as a whole is high energy- and resource-intensive production in Ukraine. The World Energy Council, which issues annual rankings of the sustainability of national energy systems, emphasizes that high levels of energy consumption and CO2 emissions remain a key threat to Ukraine’s energy security. The UNIDO project is designed to solve these problems.

In 2015, the Center worked with 20 enterprises in 5 regions in Ukraine. The effect of the technical solutions proposed by the Center’s experts will allow the companies to reduce electricity consumption by about 30,000 MW, water consumption by almost 50,000 m3, the use of materials by 105 tonnes per year, and lower CO2 emissions by 6,500 tonnes per year.

Participants in the meeting of the advisory board of the project indicated that given the commitments undertaken by Ukraine under the Association Agreement with the European Union, the Paris Agreement under the United Nations Framework Convention on Climate Change and other relevant international documents, resource efficiency is a no-alternative way of economic development for Ukraine.

Global best practices show that measures to introduce and implement resource-efficient and cleaner production become successful only when there is close cooperation of the government, international organizations, NGOs and businesses.

The experts came to the conclusion that such cooperation in Ukraine needs to be stepped up, including through engagement of international investment projects, the popularization of methods and practices of resource-efficient and cleaner production among the government, industry and the public. Also, it was decided to begin preparations to propose the State Statistics Service of Ukraine switch to European standards of assessing the energy and resource efficiency of enterprises. In addition, it is necessary to strengthen cooperation between Ukraine and UNIDO, which may be stipulated in the wording of a new framework program of cooperation between UNIDO and the government of Ukraine for 2016-2020 whose draft is now being developed with the participation of the Ministry of Economic Development and Trade of Ukraine.

Reference. This international project has been implemented in Ukraine since 2013. It aims to facilitate the competitiveness of Ukrainian enterprises through a reduction in energy-related and other costs without a decline in production. Its advisory board includes representatives of ministries, the National Bank of Ukraine, regional and local authorities of the city of Kyiv, the Ukrainian League of Industrialists and Entrepreneurs, the Chamber of Commerce and Industry, the National Technical University of Ukraine “Kyiv Polytechnic Institute” (NTUU “KPI”), large enterprises and industry associations of Ukraine.