National bank of Ukraine’s official rates as of 06/09/19
Source: National Bank of Ukraine
The World Bank invites the Ukrainian government to consider the creation of the Partial Credit Guarantee Agency as a special financial tool that will allow small and medium-sized agricultural producers to receive financing for the acquisition of land after the launch of the market. “Partial guarantee for loan contributions is the best option for Ukraine,” Lead Financial Sector Specialist for the Finance and Markets Global Practice in Belarus, Moldova and Ukraine Vahe Vardanyan said at a press conference on Thursday.
According to him, at least half of the countries have introduced government partial guarantees as a way to facilitate access to loans. There is also the practice of creating specialized partial guarantees designed specifically for agriculture, for example, in Mexico and Colombia, he said.
In order to receive partial guarantees, the farmer applies for a loan to a bank, which analyzes the application and determines the need for partial guarantee, then the bank contacts the Credit Guarantee Agency. The latter checks the compliance criteria and carries out risk analysis, approves and provides a partial credit guarantee, receives a fee from the bank for issuing the guarantee. Further, the bank provides a loan secured by partial guarantees.
In addition, the World Bank said that the Credit Guarantee Agency (company/fund) is usually a non-banking financial institution, it has its own: management, governance, capital, operating procedures. The legal structure of the agency allows for a mixed type of ownership at a certain stage, the government is not always a full owner. The National Commission for Financial Service Markets Regulation exercises supervision as over a non-banking financial institution.
All over the world, guarantee agencies are state-owned, co-financing, public private partnership is possible, but this is about joining after the first year of the institutions’ work, World Bank Country Director for Belarus, Ukraine and Moldova Satu Kahkonen said.
CREDIT GUARANTEE AGENCY, FARMERS, FINANCE PURCHASE, LAND, WORLD BANK
Ukraine in January-August 2019 increased transit of natural gas through its gas transportation system (GTS) by 2.3% compared to the same period in 2018, to 59.553 billion cubic meters, according to recent data of JSC Ukrtransgaz.
According to the calculations of the Interfax-Ukraine agency, gas transit through the country to Europe for the eight months amounted to 57.705 billion cubic meters (2.4% more compared to January-August 2018), to Moldova some 1.848 billion cubic meters (0.4% less).
In August 2019, gas transit decreased by 12.5% compared to the same month of 2018, to 6.362 billion cubic meters. In particular, gas transit through Ukraine to Europe amounted to 6.194 billion cubic meters (12.9% less), to Moldova some 168.8 million cubic meters (up by 4%).
Ukrainian President Volodymyr Zelensky has proposed to punish for amber smuggling with imprisonment from three to seven years and introduce an article on illegal extraction of amber to the Criminal Code of Ukraine.
This is outlined in bill No. 2059 amending the Criminal Code of Ukraine on criminal liability for the illegal extraction of amber or its movement across the customs border of Ukraine registered by the head of state in parliament.
So, it is proposed to introduce Article 240-1 (illegal extraction of amber). This crime is punishable by a fine of 700 to 3,000 tax-free minimum incomes of citizens (1 minimum is UAH 17), or imprisonment for a term from one to three years.
“The sale, acquisition, storage, transfer, transportation, processing of illegally obtained amber shall be punishable by a fine of 3,000 to 10,000 tax-free minimum incomes of citizens, or by imprisonment for a term from three to six years,” the president said in the bill.
The same actions committed with prior conspiracy by a group of persons, either repeatedly or on a large scale, as well as illegal amber extraction committed on the territories or objects of the nature reserve fund, shall be punishable by imprisonment for a term from four to seven years.
A plan on restructuring of JSC Ukrzaliznytsia, which foresees division of the company into three operators (infrastructure, freight and passenger) and a production block, will be prepared by the end of 2019, Ukrzaliznytsia head Yevhen Kravtsov wrote on Facebook.
“We will fulfill the order of [President of Ukraine] Volodymyr Zelensky in time,” he said.
According to Kravtsov, a gradual plan would become a part of the implementation of the Ukrzaliznytsia’s strategy agreed with the Cabinet of Ministers and approved by the supervisory council in June 2019. After the plan is fulfilled and approved by the supervisory board, Ukrzaliznytsia will begin making certain steps under the control of the government, he added.
“[Infrastructure Minister] Vladyslav Krykliy, [Prime Minister] Oleksiy Honcharuk back European model. The main is that infrastructure remains under state regulation, when passenger and freight carriages are carried under the market conditions,” he said.
As reported, Ukrainian President Volodymyr Zelensky has instructed the Cabinet of Ministers of Ukraine to prepare a plan on restructuring of JSC Ukrzaliznytsia by the end of 2019.
The president appointed Honcharuk and Krykliy responsible for the preparation of the plan.
The National Bank of Ukraine has decided from September 6 to lower the refinancing rate to 16.5% per annum from 17% per annum, at which it has been since July 19 of this year.
“The National Bank continues the cycle of easing monetary policy, as it expects inflation to slow to the target of 5%,” the central bank said.
The NBU board noted that internal political risks to reduce inflation to the target weakened with the beginning of work of the Verkhovna Rada of the new convocation and the formation of a new government. According to the regulator, this opens up an opportunity to intensify negotiations with the International Monetary Fund on a new cooperation program.
At the same time, the central bank pointed to the persistence of both internal threats to financial stability (lawsuits around the nationalization of PrivatBank) and external threats – the termination of gas transit from Russia from the beginning of 2020, the intensification of trade wars and turbulence in the global financial markets, the escalation of the military conflict and new trade restrictions of the Russian Federation.
As reported, on April 26, the NBU lowered the refinancing rate to 17.5% per annum from the level of 18% per annum, at which it had been kept since the beginning of September.
