To date, Ukraine has temporarily lost 44% of the nuclear generation, 75% of the capacity of thermal power plants and 33% of block thermal power plants, said Prime Minister Denis Shmygal.
“In general, due to constant attacks, almost two dozen power units of thermal power plants remain damaged. If we add to this the fact of occupation of part of our power facilities, Ukraine has temporarily lost 44% of nuclear generation, 75% of TPP capacity and 33% of block thermal power plants,” he said at a government meeting on Friday.
The prime minister noted that every other substation of Ukrenergo was attacked in four months.
“Despite this terror, most Ukrainians remain with heat, water and light. Repairs are underway, there are enough resources to complete the winter, generators are coming in, energy equipment from partners is on its way. Dozens of missile and drone attacks, 123 days of energy terrorism… We have withstood and will successfully complete this heating season,” the Prime Minister stressed.
U.S. long-term mortgage rates resumed rising this week after falling to their lowest level since mid-September of last year, MarketWatch reports.
The average interest rate on 30-year loans rose to 6.12% per year this week, up from 6.09% a week earlier, data from Freddie Mac, the state mortgage corporation, showed. A year earlier it was 3.69%.
Fifteen-year loans now average 5.25 percent a year, compared with 5.14 percent a week earlier and 2.93 percent a year ago.
“After the Federal Reserve’s interest rate hike and an unexpectedly strong jobs report, mortgage rates rose slightly this week. The 30-year rate is still hovering around 6 percent, and interested buyers are returning to the market just in time for the spring home-buying season,” notes Freddie Mac chief economist Sam Khater.
Freddie Mac calculates average rates based on data from about 80 institutions that provide mortgages nationwide. The rates do not take into account potential fees and other fees associated with mortgages.
Traditionally, the cost of mortgages with a slight lag repeats the dynamics of U.S. government bond yields, which in turn are responsive to the Federal Reserve’s rate increases and forecasts of its dynamics in the future. The yield on 10-year US Treasuries is around 3.684% p.a. on Friday, up from 3.524% a week earlier.
During the first day of the work of the checkpoint “Diakivtsi-Rakivets” 145 citizens were checked in and out, including 85 citizens of Ukraine, 56 citizens of Romania, 2 citizens of Italy and 2 citizens of Moldova.
As Ruslan Zaparanyuk, head of the Chernivtsi Regional Military Administration, reports in Telegram with reference to the data of the State Border Guard Service of Ukraine, also for a day 50 vehicles, including 47 cars and 3 minibuses crossed the new checkpoint.
“The checkpoint operates around the clock for pedestrian and vehicular traffic (including buses). By the decision of the Romanian side, the passage of trucks is temporarily not carried out,” the statement said.
As reported, February 10, Zaparanyuk announced the launch of a new international road border crossing point (IBCP) on the border with Romania “Dyakivtsi Rakovec. The reconstruction of the checkpoint began in 2015 as part of the project “Development of border infrastructure between Ukraine and Romania in the framework of the program “Ukraine-Romania-Moldova (2007-2013)”. Then the work was suspended and resumed in 2021.
International rating agency Moody’s Investors Service has downgraded Ukraine’s long-term foreign and local currency government and foreign currency senior unsecured debt ratings to “Ca” from “Caa3” and changed its outlook from “negative” to “stable”.
“The downgrade to ‘Ca’ is due to the effects of the war with Russia, which are likely to create long-term problems for Ukraine’s economy and public finances,” the agency said in a statement Saturday night.
These problems increase risks to government debt sustainability, making debt restructuring highly likely with significant losses for private sector creditors, Moody’s said.
The stable outlook, the release noted, reflects balanced risks at a Ca rating, which corresponds to a recovery in the event of a default, typically between 35% and 65%.
“An end to military conflict leading to a significant resumption of economic activity in the near term could result in fewer losses in the event of restructuring, while losses for private investors could be greater than the ‘Ca’ rating implies in the event of further escalation of military conflict,” the agency adds.
It also downgraded Ukraine’s local and foreign currency ceilings to ‘Caa3’ from ‘Caa2’, noting that the one notch gap reflects significant policy uncertainty and unpredictability in the face of very high geopolitical risks, as well as strong external position pressure.
In its baseline scenario, Moody’s expects the war to be protracted and the economy to register a slight contraction of 2% in real GDP in 2023, followed by a moderate recovery in 2024. Despite the high degree of uncertainty in the development of the military conflict, Moody’s expects macroeconomic and financial stability to be maintained.
According to the agency, the successful implementation of the Monitoring Program involving the IMF Board of Directors could pave the way for a funded program as early as this year, which could cement the necessary policy development and improved governance that will be key to financing post-conflict recovery.
Although prospects for EU accession remain very distant, the accession process will spur institutional reforms and anti-corruption efforts, Moody’s added.
According to its forecasts, the budget will remain under significant pressure in 2023 due to large defense and social spending, although the deficit will decline to 8% of GDP (including grants) from 17% of GDP last year, mainly reflecting spending cuts amid limited availability of financing.
Moody’s also expects the current account surplus of 5.7% of GDP in 2022 to turn into a small negative balance in 2023, largely due to a widening trade deficit reflecting reduced export opportunities and sustained imports, particularly of food, fuel, and repair materials.
Ukraine’s public debt burden is growing rapidly, and risks to the debt trajectory are tending to increase, the document also says. According to Moody’s estimates, the debt-to-GDP ratio increased by almost 35 percentage points (p.p.) to 82% of GDP at the end of 2022, and is projected to exceed 90% of GDP by the end of 2023.
The agency adds that the materialization of contingent liabilities of state-owned enterprises, especially in the energy and financial sectors, although difficult to quantify, creates additional fiscal risk.
As a result, Moody’s expects the public debt dynamics to be unsustainable, raising the possibility of a broader debt restructuring, which would lead to significant losses for commercial creditors as official creditors require private sector participation.
“Although there is considerable uncertainty about the timing and form of the restructuring, debt restructuring has become highly likely in light of the prolonged economic turmoil and large financial costs associated with the war,” the agency said.
Airlines worldwide increased passenger turnover in 2022 by 1.6 times (by 64.4%) compared to the previous year, according to data from the International Air Transport Association (IATA).
As a result, it recovered to 68.5 percent of its pre-pandemic 2019 level.
“The industry ended 2022 in much stronger shape than it started, as most governments lifted travel restrictions during the year because of COVID 19 and people took advantage of the restoration of freedom of movement,” said IATA CEO Willie Walsh. – That momentum is expected to continue into the new year, despite some governments’ overreaction to China’s opening.”
European airlines increased passenger traffic 2.3 times last year. Flight occupancy rose to 80.6 percent from 63.9 percent in 2021.
Traffic on domestic airlines in China fell 39.8% in 2022, while in India it rose 48.8%, in Japan 75.9% and in the U.S. 23.7%, according to the association’s report.
Global airline cargo traffic is down 8 percent from 2021. At the same time, it decreased by 1.6% relative to the 2019 figure.
IATA represents 300 airlines around the world, accounting for about 83% of global air traffic.
The National Agency for Detection, Search and Management of Assets Derived from Corruption and Other Crimes (ARMA) has announced a tender for the selection of a manager for the seized assets of IDS Ukraine, which produces and sells mineral water under the Morshinskaya, Mirgorodskaya and Borjomi brands.
As reported in a press release on Friday, the participants of the tender offered the management of corporate rights of the company in the form of 100% share in the authorized capital of the legal entity in the amount of 8.8 million UAH.
In addition, ARMA is looking for the manager of the corporate rights of a foreign company, namely the common uncertificated registered shares of the legal entity specializing in the wholesale of food, beverages and tobacco products, with a total nominal value of UAH 4.5 million.
It is specified, that the acceptance of applications will last till February 22, the documents are being submitted by e-mail of the agency.
As earlier reported, the general director of IDS Ukraine Marko Tkachuk said in reply to Interfax-Ukraine news agency’s inquiry that the transfer of corporate rights of the company totaling more than UAH 10 billion to ARMA would not affect the economic activities of the group.
He reminded that the decision about the transfer of corporate rights of the sanctioned IDS shareholders (citizens of the Russian Federation) to ARMA was made by Shevchenko District Court of Kyiv on November 9 and 11, 2022.
On November 23, the Bureau of Economic Security of Ukraine (BES) reported about the arrest of corporate rights of Russian shareholders of IDS Ukraine in order to avoid their withdrawal from Ukraine of assets of seven enterprises for the production and sale of drinking water. According to the BEB, these enterprises are actually owned by them through a non-resident offshore company under their control.
IDS Ukraine is a Ukrainian group of companies founded in 1996, the largest national producer of bottled water. The holding includes Morshynsky mineral water plant “Oskar”, “Mirgorod mineral water plant”, the distribution company “IDS” and water delivery operator “IDS Aqua Service”.
GK owns trade marks “Morshynska”, “Mirgorodskaya”, “Alaska” and “Aqua Life”.
According to the rating of the 100 most expensive Ukrainian brands, compiled by the publication “NV” and MPP Consulting company in 2021, the market value of “Morshynska” brand of IDS Group Ukraine holding was $ 533 million. The total amount of capital investment over the past five years amounted to 2.3 billion UAH.
