The National Bank of Ukraine (NBU) will keep the current fixed exchange rate for the time being, Deputy Head of the Regulator Yuriy Heletiy said.
“For the time being, we keep everything as it is. A fixed exchange rate helps to contain the rate of price growth and meet the needs of the economy, which is slowly recovering. We will continue to monitor the situation on the market,” he said in an interview with Forbes.ua.
He added that the NBU is ready to consider refusing to fix the exchange rate if the uncertainty associated with hostilities decreases, in particular, the end of the hot phase of the war, as well as the stabilization of foreign exchange earnings and the improvement of the situation on the financial market.
In addition, although in the long term a fixed exchange rate has more disadvantages, in particular, it creates economic imbalances, reduces the competitiveness of Ukrainian producers, but it is necessary at present because it prevents panic, protects savings from hryvnia devaluation and reduces the cost of critical imports, Heletiy explained.
“At the same time, a floating exchange rate is not an end in itself, it is a means of achieving macro-financial stability,” the deputy head of the NBU specified.
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 exchange rate at the official level of that day – UAH 29.2549/$1, which led to the emergence of a “black” market, where in the first days the exchange rate reached 39-40 UAH/$1.
Later, the regulator allowed the sale of currency in branches under the threat of capture by the occupiers, by decision of their management, and from May 21, it canceled the upper limit of both the rate of selling cash currency by banks in Ukraine and the rate of converting the hryvnia into foreign currency on their cards outside the country. Previously, the ceiling for such an exchange rate was the official hryvnia exchange rate fixed on the first day of the war plus 10%, or UAH 32.18/$1. The ceiling for other currencies was calculated at the cross rate against the dollar.
The European Bank for Reconstruction and Development (EBRD) intends to invest $1 billion in 2022 and is ready to finance NJSC Naftogaz Ukrainy, said Bank President Odile Renault-Basso.
“We intend to continue investing $1 billion this year and we are focused on supporting key infrastructure such as the power grid (Ukrenergo), we are reserving a Naftogaz credit line to support their working capital and liquidity,” she said during the discussions at the Ukrainian House in Davos as part of the World Economic Forum on Wednesday.
The EBRD intends to offer an investment plan to support these companies and the private sector in general, provide credit lines for agribusiness and pharmaceuticals and not only, she added.
“We also plan to work with municipalities to help internally displaced people,” said Renaud-Basso.
President of Ukraine Volodymyr Zelensky signed law No. 2246-IX (previously bill No. 7264 on uninterrupted production and supply of agricultural products during martial law), adopted by the Verkhovna Rada as a whole on May 12.
The relevant information was published on the parliamentary website on Wednesday.
As reported, the Verkhovna Rada simplified the export, import and transit of agricultural products to Ukraine during martial law, which will expand farmers’ access to fertilizers and genetic material of farm animals, as well as support the Ukrainian organic industry.
“The task of the state is to simplify farming under martial law as much as possible and reduce the bureaucratic burden on business and government bodies. This applies, in particular, to the state registration of pesticides and agrochemicals, which is extremely important during the spring sowing campaign in 2022. Also it is important to support niche sectors of agriculture and organic production,” the explanatory note to the document states.
Law No. 2246-IX abolishes until the end of martial law and for 90 days after its cancellation the state registration of agrochemicals imported into Ukraine, including some types of nitrogen fertilizers, ammonium nitrates, ammonia in aqueous solution, thiosulfates, potassium, calcium and aluminum phosphates, borates, chelate zinc and a number of other mineral fertilizers.
In addition to the simplified import of such types of fertilizers, the bill cancels the state registration procedure for their production, sale, use and advertising.
The law also allows producers of organic products to use the label “organic”, “biodynamic”, “biological”, “ecological”, “organic” until July 1, 2024, even if they are not operators of organic products in accordance with law 2496-VIII on turnover organic products.
This initiative allows Ukrainian producers of organic products that were producing according to EU standards, but did not meet the status of an operator of organic products according to Ukrainian standards, to switch to Ukrainian production standards without an additional transition period. It also allows them to qualify for government support.
The document expands the list of entities that can take samples and conduct phytosanitary examination, in particular, introduces until the end of martial law and by 90 after its cancellation a simplified procedure for involving employees of private laboratories in the examination, and also authorizes agronomists-inspectors to conduct such inspections to conduct an audit on certification.
In addition, Law No. 2246-IX allows the import to Ukraine of cargoes with live animals in transit through countries where there are cases of disease from the list of the International Epizootic Bureau (OIE). This will allow the Ukrainian livestock industry to access modern breeding genetic material from the EU countries and expand the diversity of breeding material of agricultural animals in Ukraine.
ANIMALS, FERTILIZERS, IMPORT, LAW, PHYTOSANITARY CERTIFICATES
The Ministry of Agrarian Policy and Food of Ukraine initiated the allocation of UAH 3.39 billion of portfolio guarantees to four state-owned banks for lending to the processing industry of the Ukrainian agro-industrial complex.
As reported on the website of the agency on Wednesday, this measure will stimulate the processing of agricultural raw materials within the country, large reserves of which are difficult to export in the context of a halt in Ukrainian agricultural exports due to the blockade of its key seaports by Russian warships.
“Given that our seaports are blocked and we cannot export our grain in the required quantity, we will focus on the processing industry. As a result, enterprises operating in this area, thanks to portfolio guarantees, will be able to buy a certain stock of their products from agricultural producers , and the latter, in turn, will be able to repay part of the body of the loan,” Bagrat Akhidzhanov, director of the financial and economic department, quotes the Ministry of Agrarian Policy.
According to him, lending to agricultural processing will provide the maximum possible financial resource to the entire sphere of the Ukrainian agro-industrial complex.
In addition, it is specified that the ministry has already developed a plan for further financing of farmers in June-August.
“The Ministry of Agrarian Policy has a number of developments in lending to the agricultural products processing industry. Yes, we have already initiated changes to Decree No. 723 to expand the list of those who can receive loans under state guarantees by including processing enterprises in this list,” the statement reads. message of the words of First Deputy Minister Taras Vysotsky.
As reported with reference to the Minister of Agrarian Policy Mykola Solsky, the main factors for the development of agricultural processing in Ukraine are the opening of European and world markets on an ongoing basis, as well as affordable financing for farmers.
AGRO-INDUSTRIAL COMPLEX, MINISTRY OF AGRARIAN POLICY, PROCESSING INDUSTRY
In January-April this year, Ukrainian Coke and Chemical Plants (CCP) reduced the production of 6% moisture metallurgical coke by 41.4% compared to the same period last year, to 1.905 million tons.
Anatoly Starovoit, general director of the association of coking enterprises Ukrkoks (Dnipro), told Interfax-Ukraine that 243,000 tons were produced in April and 179,000 tons in March.
At the same time, he specified that Yuzhkoks, Kametstal (former DKHZ), DMZ (Dneprokoks), Zaporizhkoks, and coke production at ArcelorMittal Krivoy Rog are currently operating.
“The largest Avdiivka Coke Plant is idle,” the agency’s interlocutor stated.
The CEO also said that in 4 months-2022, 1 million 875.4 thousand tons of coal concentrate were supplied to domestic CCP, including 642.67 thousand tons of Ukrainian production, 616.9 thousand tons were imported from the Russian Federation, from Kazakhstan – 65.4 thousand tons, Poland – 29.1 thousand tons, Czech Republic – 30.6 thousand tons, USA – 380.3 thousand tons and Australia – 110.5 thousand tons.
In April, 255.2 thousand tons of Ukrainian production were delivered, 8.2 thousand tons were imported from the Russian Federation, 0.1 thousand tons from Poland, 2 thousand tons from the Czech Republic, 18.2 thousand tons from the USA, Australia – 34.5 thousand tons, in total 318.2 thousand tons were imported.
Starovoit also recalled that in January, 135.7 thousand tons of coal concentrate of Ukrainian production were supplied to the Coke Plant, as well as, in particular, 416.9 thousand tons from the Russian Federation, 41.3 thousand tons from Kazakhstan, 13.2 thousand tons – from the Czech Republic, 197.5 thousand tons – from the USA, 4.1 thousand tons – from Australia, in total – 809.1 thousand tons.
In February, 104 thousand tons were delivered (Ukraine), in particular, 178.3 thousand tons were imported from the Russian Federation, 24.1 thousand tons from Kazakhstan, 2.6 thousand tons from Poland, 6.6 thousand tons from Czech Republic, 138.9 thousand tons from the USA.
As reported, the Ukrainian Coke Plants (KHZ) in January this year reduced the production of 6% moisture metallurgical coke by 4.5% compared to the same period last year – up to 807 thousand tons. In December, 812 thousand tons of coke were produced.
Ukraine in 2021 reduced the production of coke by 1.3% compared to 2020 – to 9.543 million tons.
Austria will accept up to 100 seriously wounded women and children from Ukraine for treatment and rehabilitation, Austrian Chancellor Karl Nehammer said.
“Yesterday I spoke with Ukrainian President Volodymyr Zelensky and Prime Minister Denys Shmygal. I offered to accept, treat and provide rehabilitation for up to 100 seriously wounded women and children. We will continue to help as much as we can!” Nehammer wrote on Twitter on Wednesday.
