Business news from Ukraine

EBRD ADVISES UKRAINE LAUNCH TRAINING PROGRAM TO IMPROVE INTERACTION WITH SMALL AND MEDIUM BUSINESSES

KYIV. Oct 24 (Interfax-Ukraine) – Ukraine should launch a training program for civil servants to improve interaction between the state and small and medium-sized businesses, Director of the European Bank for Reconstruction and Development (EBRD) in Ukraine Sevki Acuner said at a business forum in Kyiv on Friday.

It would be a good idea if the government and executive authorities created a training program for civil servants, so that they should better understand the importance of entrepreneurship for economic prosperity of the country, he said.

BUSINESSMEN RECEIVE UAH 1.5 BLN FROM INVESTORS IN FIRST SIX MONTHS OF KUB PORTAL OPERATION

KYIV. Oct 24 (Interfax-Ukraine) – Ukrainian businessmen have received UAH 1.5 billion of financing to start or develop their own business in the first six months of operation of the KUB portal (credits to Ukrainian business). This helped create 71,000 new jobs, PrivatBank Board Chairman Oleksandr Dubilet has said.

“There is money on the P2P platform. Yes, the rate is high. Depositors want to have the rate of 23-24%. Local authorities today could compensate the rate and make it affordable – 8-9%. It would be beneficial. It would be returned to the local budget… soon via taxes and salaries,” the banker said at a press release at the Ukraine is a Country of Entrepreneurs forum in Kyiv last week.

He said that the program to finance small and medium-sized business via KUB with financing of UAH 20 billion in 2016-2018 could help to create around 1 million jobs.

As reported, PrivatBank acted as the operator of the Р2Р crediting platform in partnership with MasterCard.

The P2P platform allows creditors to receive a chance of issuing credits to borrowers without intermediaries, having bigger rates compared to deposit rates, borrowers to have access to cheap credits and banks to connect to the platform and credit borrowers without spending on the search of clients, assess risks and other things.

PrivatBank was founded in 1992. Its largest shareholders were Hennadiy Boholiubov and Ihor Kolomoisky as of January 1, 2016.

The bank ranked first among the 108 operating banks in the country as of July 1, 2016, in terms of total assets worth UAH 268.85 billion, according to the National Bank of Ukraine.

UKRAINIAN WORLD CONGRESS SETS UP COMMITTEE TO SUPPORT ECONOMIC DEVELOPMENT OF UKRAINE – GROYSMAN

KYIV. Oct 24 (Interfax-Ukraine) – Ukrainian Prime Minister Volodymyr Groysman has welcomed the establishment of a committee by the Ukrainian World Congress to support the economic development of Ukraine.

“The Ukrainian World Congress supports the government on the path of reforms and set up a committee to support economic development. I welcome this initiative and am ready for close and quality cooperation,” Groysman wrote on his Facebook page.

“The support of our powerful 20-millon diaspora could be very useful for us,” the premier said.

As reported, the Cabinet of Ministers of Ukraine and the Ukrainian World Congress on September 27, 2016 signed a memorandum of cooperation. According to Groysman, cooperation can take place both in economic and cultural spheres.

UKRENERGO SAVES UAH 5.3 BLN ON PROCUREMENT IN A YEAR – COMPANY HEAD

KYIV. Oct 24 (Interfax-Ukraine) – National energy company Ukrenergo since October 2015 as of today has saved UAH 5.3 billion during procurement, acting Director of Ukrenergo Vsevolod Kovalchuk said on Espreso TV.

“We have saved UAH 5.3 billion on procurement during a year of my work,” he said, adding that over UAH 3 billion was saved at tenders held at the end of September 2016.

The top manager said that the key reason of saving funds is competition between bidders at tenders announced by the company.

“We save not only because the prices were set too high. We save because we attract dozens of executors of these tenders to the process. The only mechanism is competition. We recorded clear statistics: when there are two bidders in the tender – 3% is saved. They made an arrangement. When we bring 20 companies from all over the world with geography of 15 countries, they do not make arrangements between each other,” Kovalchuk said.

As reported, late March 2016 Ukrenergo signed a contract with ZTR to supply 22 autotransformers and shunt reactors worth UAH 828.591 million (VAT included). The price of transformer equipment turned out to be UAH 1.1 billion lower than expected due to competition between ZTR, ABB and Siemens at the auction.

On September 27, September 28 and September 30 the company opened tender bids to reconstruct six high-voltage substations using funds of the World Bank. The company saved around UAH 3.3 billion ($125 million) or 47% of the sum estimated to reconstruct these substations in 2014.

Bids were filed by companies in Italy, Croatia, China, Germany, Slovenia, Sweden, Kazakhstan, Azerbaijan, Saudi Arabia, South Korea, the Czech Republic, Latvia and Ukraine.

Kovalchuk said that in 2014 reconstruction of the substations was assessed at $267 million, while after the tenders it would be carried out for $142 million. The 330 kV substations Zhytomyrska, Cherkaska, Novokyivska, Nyvky, Sumy and Kremenchuk will be reconstructed.

BUSINESSMAN YAROSLAVSKY PLANS TO LAUNCH KHARKIV TRACTOR PLANT FROM 2017

KHARKIV. Oct 21 (Interfax-Ukraine) – DCH Group owner and president Oleksandr Yaroslavsky plans to resume the work of Kharkiv Tractor Plant from the beginning of 2017.

“I cannot now voice the exact timing of the resumption of the plant’s operations… We have all the levers for this. We have only to finish all our court cases… I hope next year we will launch the plant,” Yaroslavsky said at a briefing in Kharkiv.

As reported, complex reorganization measures are being held at the plant to resume its work. A number of services have started work, economic ties with suppliers and partners are being resumed.

As reported, Yaroslavsky will become virtually the sole owner of Kharkiv Tractor Plant after he buys a stake of around 29%, which the Austrian investor refused, and concentrates 91.76% of the shares.

According Yaroslavsky, the remaining 8% of the shares is owned by about 20,000 minority shareholders.

YUZHNY PORT ATTRACTIVE FOR INVESTORS – PORT ADMINISTRATION HEAD

KYIV. Oct 21 (Interfax-Ukraine) – Potential investors are ready to work at Yuzhny maritime merchandise port (Odesa region), but there is a problem of managing port land, Head of Yuzhny Port branch of Ukrainian Sea Port Authority Maksym Shyrokov has said.

“Today the administration does not manage port-side land, and this is the main thing, the start of all investment. We do not have synergy with local authorities and understanding who needs land and for what purpose,” he said in an interview with Interfax-Ukraine.

He said that today local authorities make independent decisions and allocate land parcels. The Sea Port Authority is not invited to hear what is planned to do on these parcels.

“This situation is absurd. Port managers do not manage port land and do not decide how to use it,” he said.

Shyrokov said that no land parcel belongs to the port, and private companies own land.

“For example, I could bring a good investor to 3 ha of port land and he is ready to come, asking where he can go to settle the issue. He goes to local authorities and keeps going to the same rooms for six months and finally cannot bear it and leaves. Who is interested in getting investment: me or local authorities to replenish their local budgets? We are interested in implementing development plans, as well as our ministries, but we do not have enough tools for this,” he said.

Yuzhny port was founded in 1978. It is located on the Adzhalyk firth and is the deepest harbor in Ukraine. The length of its berths is around 2.6 kilometers. The port has six handling terminals.

Sea terminals in various forms of ownership operate at the port: Pivdenny oil terminal, Transbunker-Yug LLC’s fuel handling terminal, a terminal of Transinvestservice LLC, a grain handling terminal of Borivage LLC, and a tropic oil handling and processing complex of Delta Wilmar CIS LLC.