Ukraine increased its exports of granulated slag to the EU in 2023 to 367 thousand tons, up 53% compared to 2022, of which 324.5 thousand tons (+47.5% compared to 2022) were supplied by Recycling Solutions, the company’s press service reports.
“We have managed to attract new customers and expand our sales market, despite the fact that the European construction sector is going through a crisis. Europe lacks its own similar raw materials, and Ukraine can meet the demand of European manufacturers. For us, this is an opportunity to support the national economy and ensure the inflow of foreign currency into the country,” Vadym Khoroshko, Director of the Construction Admixtures Department, explained in a press release.
According to the published data, the total volume of granulated slag imports to the EU countries in 2023 amounted to 3.35 million tons. The leading suppliers are Japan (1.2 million tons), China (0.7 million tons), Turkey (0.7 million tons) and Ukraine. The main consumers of this product are cement plants, which are currently operating unstably due to lower demand. The European construction market and road construction have slowed down significantly. On the other hand, the launch of the Carbon Based Import Adjustment Mechanism (CBAM) in October 2023 is having a positive impact on the waste and by-products market. In the spring, a new cement production season begins, in which Recycling Solutions expects demand to remain at the level of 2023, the press release said.
It is reported that in 2023, 44% of construction admixtures sold by Recycling Solutions were exported. The largest volumes were purchased by customers from Poland and Slovakia. In addition to slag, last fall the company was the first Ukrainian producer to export 1380 tons of dry ash.
The company also notes an increase in sales in the domestic market, explaining that demand for construction admixtures is driven by reconstruction projects and the emergence of small tenders for road resurfacing. In particular, last year Recycling Solutions shipped 407.2 thousand tons of granulated slag to Ukrainian customers, which is 69% more than last year. The company also sold 363.3 thousand tons of dump slag used for road construction and emergency repairs, and shipped 282 thousand tons of other ash and slag materials, 30% more than in 2022.
In addition, last year Recycling Solutions launched an aluminosilicate microsphere production plant in Burshtyn, Ivano-Frankivsk region. The company operates on equipment evacuated in 2022 from Druzhkivka (Donetsk region), which was located in close proximity to the front line. Investments in the project amounted to $313 thousand. The launch of production made it possible to ship 521 tons of microspheres in 2023.
Recycling Solutions was founded in 2012 and is part of Rinat Akhmetov’s umgi investment company. It provides strategic by-product and waste management services. Currently, it is an integrated operator of secondary resources management for the coal, metallurgical, heat and power, and agricultural sectors of Ukraine. The company’s activities include processing and sale of ash and slag materials, metallurgical slag, rare and industrial gases, ammonium sulphate, livestock by-products, and production of heat and electricity from coal mine methane.
umgi founded SCM in 2006 to manage assets in the raw materials sector. Later, it expanded its range of activities and changed its business model from management to investment. The total market value of its portfolio companies exceeds $500 million.
Advertising
JSC OTP BANK has introduced a new service – sale of domestic government bonds from its own portfolio in the OTP Bank UA application. From now on, customers have the opportunity to purchase domestic government bonds at any convenient time, regardless of the date of the Ministry of Finance of Ukraine’s auctions.
“The new functionality opens up even more opportunities for investing in government securities, as well as allows you to choose the optimal bond rate and maturity. The service is already available online to all individuals who have opened a securities account in any branch of the Bank,” said Valeria Ovcharuk, product owner of OTP Bank.
According to her, the process of buying government bonds is convenient and fast. “The OTP Bank UA app offers an easy interface for purchasing government bonds. Just a few clicks and the securities are in your bond portfolio. It is a reliable and profitable investment in the future, as the repayment of domestic government bonds is 100% guaranteed by the state,” emphasized Ovcharuk.
Investing in domestic government bonds is not only an opportunity to support the financial stability of Ukraine in times of war, but also a good opportunity to diversify your savings and receive additional income in both hryvnia and foreign currency.
Last fall, OTP BANK opened the opportunity to buy domestic government bonds directly at auctions of the Ministry of Finance through the OTP Bank UA application. During 2023, the Bank’s customers purchased domestic government bonds for a total amount of UAH 6.3 billion in equivalent, which is 153% more than in 2022.
As a reminder, in 2023, OTP Bank was ranked fourth among Ukrainian banks in the overall rating of primary dealers, according to the Ministry of Finance of Ukraine.
The status of a primary dealer provides the exclusive right to participate in the placement of domestic government bonds conducted by the Ministry of Finance, both on its own behalf and for clients of individuals and legal entities, as well as banks and financial companies that do not have such a status.
To learn more about investing in domestic government bonds through the OTP Bank UA app, please follow the link.
Dragon Capital Investment Group has revised its forecast for the average annual hryvnia exchange rate in 2024 from 37.3 UAH/$1 to 40 UAH/$1, and the exchange rate at the end of the year from 39.0 UAH/$1 to 42.0 UAH/$1, but maintained its GDP growth forecast at 4.0%.
“We expect the hryvnia to continue to weaken against the US dollar in a controlled manner. We have revised our forecast due to the change in the National Bank’s approach to managing the exchange rate in early 2024,” the group said in a press release on Tuesday.
According to Dragon Capital’s updated estimates, external financial support for Ukraine’s budget from partners this year will amount to $37 billion and will support the economy’s resilience.
“Although the approval of the support packages has been significantly delayed and the total amount of funding will be slightly less than we expected ($40 billion), these funds will be sufficient to keep the NBU reserves at current record levels around the current record $43 billion (previous forecast – $45 billion) and to finance the budget deficit without issuing,” the release says.
However, the investment group adds, the budget situation remains tense and will require mobilization of internal resources. The law on the state budget for 2024 needs to be significantly revised, as the defense and security expenditures envisaged in it are clearly not enough to adequately finance the army throughout the year.
“The updated law should also take into account the impact of increased mobilization, which, according to our estimates, will cost the budget of all levels $1.5-2.0 billion (including the indirect impact on revenues). In general, military spending in the general fund of the state budget will need to be increased by at least $9 billion to keep it at the level of last year,” Dragon Capital believes.
At the same time, the company believes that this increase can be partially financed by reducing non-military expenditures (for example, to service external commercial debt after its restructuring) and additional revenues (tax on unexpected bank profits, increased transfers from the NBU, and increased excise rates on fuel).
In general, the investment group expects the government to slightly reduce the public administration budget deficit this year to about UAH 1.6 trillion from UAH 1.7 trillion last year (excluding grants) due to an organic increase in tax revenues from economic growth, additional measures to fill the budget revenue side and a restrained approach to non-defense spending.
“The hryvnia depreciation will not have a decisive impact on the budget deficit dynamics, as part of the military spending is directed to the purchase of imported goods and compensates for tax revenues that depend on the hryvnia exchange rate. However, a weaker hryvnia helps to reduce the need to finance the budget deficit with domestic borrowing, as it increases the hryvnia equivalent of international aid,” the press release said.
At the same time, the revision of the exchange rate forecast led to a decrease in estimates of Ukraine’s nominal GDP this year to $190 billion from $201 billion and an increase in the forecast of public debt at the end of the year from 85% of GDP to 92% of GDP, although in absolute terms the forecast was raised slightly – from $164 billion to $166 billion.
Dragon Capital assumes that the NBU will change its approach to managing the exchange rate in accordance with its own assessment of the balance of risks to financial stability. At the same time, the record level of international reserves will allow the central bank to continue to keep the situation in the foreign exchange market under control and avoid uncontrolled devaluation, provided that domestic economic policy is aimed at maintaining macroeconomic stability and international partners continue to provide financial support in the minimum necessary amounts, the investment group emphasized.
Given the slowdown in inflation and stable inflation expectations, moderate devaluation does not pose risks to macrofinancial stability, but supports export competitiveness, helps the budget by reducing funding needs, and reduces the loss of reserves from the initial effects of currency liberalization, Dragon Capital believes.
“We expect that the NBU will take a balanced approach to determining the further dynamics of the hryvnia exchange rate, as the population’s sentiment remains vulnerable in the context of the war, and it is unlikely to determine the equilibrium level of the exchange rate using standard methods given the specifics of the balance of payments structure caused by the war,” the press release said.
According to it, the inflation forecast for 2024 has been improved from 8% to 7.6%, and the discount rate at the end of the year has been reduced to 13% from 15%.
The investment group explained that the forecast of GDP growth in 2024 by 4.0% was maintained by the recovery of exports by seaports and the development of the military-industrial complex, which will be the main drivers of economic growth this year and will outweigh the negative impact of increased mobilization and electricity shortages, assuming that the authorities will be able to organize mobilization in such a way as to limit the negative impact on business.
“According to our estimates, given the existing capacity of the power grid and current import opportunities, the electricity shortage will be quite moderate in summer and autumn, which will allow enterprises in most industries to maintain production volumes at levels close to current levels and therefore increase them compared to 2023,” the investment group believes. The growth will be especially noticeable in sectors that were depressed due to the lack of maritime exports, namely ore production, metallurgy, and cargo transportation, Dragon Capital added.
The company also predicts that thanks to the resumption of seaports and a larger-than-expected agricultural harvest last year, exports of major commodities will grow by 35% to 109 million tons this year, which will help keep the foreign trade deficit from widening further (its estimate has been reduced to $29.0 billion from $32.9 billion), despite rising imports and lower global agricultural prices.
In January-March 2024, lifecell mobile operator’s revenue increased by 16.1% compared to the same period in 2023, to UAH 3.12 billion.
According to the report of the parent company Turkcell, lifecell’s net profit for the first quarter increased by 13% to UAH 582.7 million.
Lifecell’s EBITDA for the period increased by 5.7% to UAH 1.69 billion. At the same time, the EBITDA margin decreased by 5.3 percentage points to 54.4%.
The company’s capital investments in the first quarter increased by 58% to UAH 1.008 billion.
“Three years ago, we developed our medium-term strategy. The name of the strategy was 20-24! It meant 20% market share in 2024! The great lifecell team has done it! The best team in history has increased our market share by 5 percentage points in terms of revenue; from 15.5% to 20.2% for a long time!” Ismet Yazici, CEO of lifecell, commented on the results on Facebook.
He reminded that the company had to work with the challenges of the COVID pandemic, a full-scale war in Ukraine, and unfair regulatory conditions.
Yazidi said that in the first quarter of 2024, lifecell’s subscriber base grew by 12.8%, without specifying the absolute figure.
Turkcell’s report says that the Ukrainian assets of Lifecell LLC, Global Bilgi LLC and Ukrtower LLC, which the Turkish company has owned since July 10, 2015, have been allocated to the disposal group in connection with the agreement to transfer all shares, as well as all rights and debts of these companies to French NJJ. The agreement with the company of French billionaire Xavier Niel was signed on December 29, 2023.
Turkcell CEO Ali Taha Koç, answering investors’ questions at a conference on the first quarter results, said that the deal to sell Ukrainian assets to DVL Telecom, a member of French billionaire Xavier Niel’s NJJ group, would be closed by the end of 2024. According to him, after the Ukrainian court lifted the seizure of some of the assets, the company is awaiting approval from the Antimonopoly Committee, which is the last step to close the deal.
Large language models (LLM), on which ChatGPT and other generative (content-creating) artificial intelligence (AI) tools are based, will never reach the level of human intelligence, believes Jan Lekun, chief scientist of the American Meta in the field of AI.
In his opinion, such models have a very limited understanding of logic and will not be able to reason and plan like a human. In addition, they “do not understand the physical world, do not have permanent memory, are unable to reason in any reasonable sense of the word, and cannot plan … hierarchically,” he said in an interview with the Financial Times.
Lecun argued against relying on LLM development in an effort to create human-level intelligence, as these models can only accurately respond to queries if trained on correct data, and are therefore insecure.
Instead, the expert is developing an entirely new generation of AI systems that he hopes will endow machines with “human” intelligence. However, this task could take a decade to complete, he explained.
Lecun leads a team of about 500 people at Meta’s basic AI research lab. They are working on creating an artificial intelligence that can develop a sense of common sense and study the structure of the world in a similar way to humans. This approach is called “world modeling.”
Import changes in % to previous period in 2023-2024
Source: Open4Business.com.ua and experts.news