Business news from Ukraine

TV AND INTERNET PROVIDER VOLIA WANTS TO BOOST ARPU BY 25%

Volia provider (Kyiv) expects that ARPU (average revenue per user per month) will increase by 25% in 2018 compared with 2017, to UAH 137, Volia CEO Gyorgy Zsembery has told Interfax-Ukraine. “Thanks to our focus on high-margin subscribers, this year I expect ARPU to be UAH 137. ARPU growth is expected to be 25% by the end of the year,” he said, not disclosing the company’s revenue forecasts.
Zsembery also said that the company plans to increase the share of interactive TV users in the total number of TV subscribers to 20% by the end of this year. At the end of the first half of the year, their share in the company was 16%.
According to him, over the past five years, Volia has invested UAH 2 billion in technology and content.
“This has worked. In the years when the market did not grow at all, we always had revenue growth – at least 10% starting from 2015. We believe in the Ukrainian market, so we will continue investing in those areas in which we are strong and competitive – into our digital content and telecommunications network,” he said.
Volia services around 2 million cable TV and Internet subscribers in 34 cities and towns of Ukraine. It is managed by Providence Equity Partners (34.92%), private international investment company SigmaBleyzer (15.3%) and the European Bank for Reconstruction and Development (EBRD, 11.7%).

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UKRAINE REGISTERS NEW INDUSTRIAL PARKS

Ukraine’s Economic Development and Trade Ministry has placed Zakhid Resurs industrial park (Horodok, Lviv region) and Ternopil industrial park in the register of industrial parks, becoming 32nd and 33rd parks in the register.
According to information on the ministry’s website, parks are registered by orders of the ministry dated September 19, 2018.
The initiator of the creation of the Zakhid Resurs industrial park on the land parcel of 20.7662 hectares is Euro-Invest-Holding LLC (Horodok, Lviv region). The stated term of the park’s functioning is 30 years.
The purpose of the park is to form a single territory with a well-equipped infrastructure for the placement of new economic enterprises in the processing industry, innovation, logistics and provision of related services, and increase the competitiveness of the region.
Priority for placement will be the production of food and nonalcoholic beverages, storage and processing of crop and livestock products; textile production, production of clothing, leather, fabric and leather products and other materials; wood processing and the manufacture of products from it; machine building, instrument making, production of electrical equipment, electronic and optical equipment; logistical services.
According to preliminary calculations, up to 1,625 new jobs can be created on the territory of the industrial park.
The owner of 100% of Euro-Invest-Holding LLC is Serhiy Badiak registered in Lviv.
The Ternopil industrial park, initiated by the Ternopil City Council, has a land area of 15 hectares.
The main goal of its creation, in particular, is to ensure the sustainable economic development of Ternopil by restoring the industrial potential of the city.
The stated period of operation is 30 years.
The functional purpose of the park is processing industry (primary and secondary processing of agricultural raw materials, production of food products, baby food); professional scientific and technical activities (research activities to improve product quality and use of new technologies, IT cluster).
Up to 1,100 new jobs can be created in the park.

UKRAINE INTERESTED IN LIBERALIZING U.S.-UKRAINE AIR TRANSPORTATION

Ukraine’s Infrastructure Ministry is interested in liberalizing air transportation between Ukraine and the United States.
This was announced by Ukrainian Infrastructure Minister Volodymyr Omelyan at a meeting with the U.S. Under Secretary of Transportation for Policy Derek Kan, the U.S. Transportation Department’s International Aviation Director Brian Hedberg and Deputy Executive Director for the Office of International Affairs in the U.S. Federal Aviation Administration (FAA) David Burkholder as part of a working visit to the United States.
“We are ready to develop passenger air transportation with the countries and are interested in facilitating the implementation of the agreement between Ukraine and the United States on air communication. We will sincerely welcome the expansion of the presence of American airlines in Ukraine,” the Infrastructure Ministry’s press service quoted Omelyan as saying.
According to the press release, Omelyan said Ukraine is interested in attracting U.S. experience in the development of digital infrastructure. He discussed with his American counterparts the policy of Ukraine in the field of anti-corruption.
As reported, the Infrastructure Ministry has predicted the signing of an agreement on the Common Aviation Area (CAA) with the EU during spring 2019.
The accession of Ukraine to the common aviation space with the EU is an important step for the development of the country’s aviation industry. Liberalization of airspace, first of all, will attract new airlines to Ukraine, and then increase competition in the market, which will make air transportation much more affordable.
In accordance with the Ukraine-EU Association Agreement, civil aviation is regulated by a separate agreement – Stabilisation and Association Process (SAP), which was initiated in 2013, but not yet signed. The signing of the agreement on SAP was postponed twice on the initiative of the EU side. The main reason for the delay is the lack of consensus between Spain and the UK on the wording on the territorial application of the agreement in part of Gibraltar.
In addition, Ukraine should bring the country’s aviation regulations in line with EU airspace legislation.

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UKRAINIAN BORSCHAHIVKA CHEMICAL PLANT WINS UNDP TENDER TO SUPPLY ANTI-TUBERCULOSIS MEDICINE

Research and Industrial Center Borschahivka chemical and pharmaceutical plant (Kyiv) has won a tender of the United Nations Development Program (UNDP) to supply anti-tuberculosis medicine Rifampicinum using budget funds. According to the contract signed by the plant and the UNDP, the total amount of medicines worth UAH 6 million is to be handed over to the international organization no later than January 2019.
“The victory of the enterprise in the tender confirms that any pharmaceutical manufacturer that is able to provide high-quality products at an affordable price has a chance to win. We have already delivered the first batch of drugs for tuberculosis treatment in the tender,” the press service reported, citing Director General Yulia Zdarevska.
As reported, Borschahivka chemical and pharmaceutical plant in 2017 won the tender of UNDP for the supply of two anti-tuberculosis drugs Rifampicinum and Aethambutolum for UAH 3.6 million.

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UAH 1.1 BLN TO BE SENT FOR ODESA AIRPORT RECONSTRUCTION IN 2019

Ukraine’s Infrastructure Ministry has approved the assignment of UAH 1.1 billion in 2019 for reconstruction of the airfield of municipal enterprise Odesa International Airport, including for construction of a new runway with the synthetic covering and taxiways. “The mechanism of financing the implementation of the program approved by the State Agency of Infrastructure Projects of Ukraine allows starting the implementation of the project at once in line with Ukrainian legislation,” the enterprise said in an explanatory note to the financial plan of state-owned enterprise (SOE) Directorate for Construction of Odesa International Airport for 2019.
The financial assistance will be received from the SOE managed by the State Agency of Infrastructure Projects of Ukraine, which was authorized to act as the customer of the state targeted program on development of airports for the period until 2023. According to the explanatory note, the reviewed indicators are UAH 500 million for 2017, UAH 1.179 billion for 2018 and UAH 1.109 billion for 2019. The capital investment in the financial plan for 2019 is planned at UAH 874.25 million. Net profit expected in 2019 is UAH 83,000, and revenue – UAH 13.31 million.
As reported, the Cabinet of Ministers of Ukraine in July 2018 decided to send UAH 253 million to build a runway in the Odesa airport.

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