The real gross domestic product (GDP) of Ukraine in 2018 grew by 3.3% after raising by 2.5% in 2017 and by 2.4% in 2016, the State Statistics Service has stated.
Real wages in Ukraine in February 2019 compared with February 2018 increased by 10.7%, while compared with January 2019 it decreased by 1.7%, the State Statistics Service has reported.
Total wage arrears in Ukraine in January 2019 decreased by 1.2%, and as of February 1, 2019 amounted to UAH 2.614 billion, the State Statistics Service has reported.
Exports of goods from Ukraine in January 2019 from January 2018 grew by 9.2%, to $4.066 billion, while imports increased by a mere 0.7%, to $4.045 billion, the State Statistics Service has reported.
The annual inflation rate in Ukraine in February is in line with the forecast of the central bank, according to the website of the National Bank of Ukraine (NBU).
Inflation in Ukraine in February 2019 was 0.5% compared with 1% in January and 0.8% in December last year, the State Statistics Service of Ukraine has reported.
Industrial prices in Ukraine in February 2019 increased by 1%, as a month earlier, after decreasing in December 2018 by 0.4% and growing in November 2018 by 1.7%, the State Statistics Service has reported.
The deficit of the national budget of Ukraine in January-February 2019 amounted to UAH 13.7 billion, in particular the general fund deficit was UAH 28.65 billion with the target being UAH 28.32 billion, according to the State Treasury Service.
The revenues of the national budget of Ukraine in February 2019 amounted to UAH 70.2 billion, which is 8.3% more than the target and 24.8% more than in February 2018, in particular UAH 56.6 billion was sent to the general fund, or 2.1% less than the target and 12.2% more year-on-year, according to data released by the State Treasury Service.
Revenue of Ukrainian banks, not taking into account insolvent ones, in January and February 2019, totaled UAH 39.279 billion, which is 40.4% more than a year ago, according to a posting on the website of the National Bank of Ukraine (NBU).
The total public (direct) and state-guaranteed debt of Ukraine in February 2019 decreased by 0.02% compared with January 2019, to $78.24 billion, the Ministry of Finance has reported. Ukraine’s payments on gross external debt in 2019 will be $15.7 billion, according to data on the website of the National Bank of Ukraine (NBU).
Industrial production in Ukraine in February 2019 decreased by 1.8% compared with February 2018, which is better than the figure in January, when the decline was 3.3%, the State Statistics Service has reported.
Capital investment in agriculture in 2018 totaled UAH 90 billion, including UAH 25 billion invested in processing, Ukrainian Prime Minister Volodymyr Groysman has said.
Transport enterprises of Ukraine in January and February 2019 increased cargo transportation by 5.9% compared to January and February 2018, to 103.1 million tonnes. The transport companies of Ukraine in January and February 2019 reduced passenger traffic by 6% compared with January and February 2018, to 685.4 million people.
The volume of construction work carried out in Ukraine in February 2019 increased by 19.4% compared with February 2018, while in January 2019 from January 2018 this figure increased by 6.2%.
Retail trade turnover in Ukraine in comparable prices in January and February 2019 increased by 6.8% compared to January and February 2018, to UAH 150.913 billion, the State Statistics Service has reported.
Insurance companies that are members of the Motor (Transport) Insurance Bureau of Ukraine (MTIBU) in January-February 2019 increased collection of insurance premiums for compulsory insurance of motor vehicle owners’ civil liability (OSAGO) by 18.12% compared to the same period of 2018, to UAH 661.448 million. According to data posted on the MTIBU’s website, the number of OSAGO contracts in January-February rose by 7.06%, to 1.066 million.
The total amount of insurance claim fees paid on domestic insurance contracts for the two months grew by 8.5%, to UAH 393.3 million. In particular, UAH 73.116 million was paid using European accident report forms, which is 43.1% more than in January-February 2018.
The bureau also recorded an increase in the number of settled claims for insurance compensation by 6.4%, to 22,500.
Sending law enforcement officers in balaclavas armed with Kalashnikovs kicking down a company’s office door in a frantic search for financial records or tax documents is quite possibly the worst message a government can send to business owners, shareholders or executives. This is what I told President Petro Poroshenko a couple of years ago in a hall packed with five hundred business leaders during one of his regular meetings with the international business community. Consequently, parliament introduced new legislation curtailing the brutality of business inspections. These dramatic raids on business are now all but a memory of the low points that investors faced while doing business in Ukraine years ago. Many reforms have been introduced since 2015, and Ukraine has started reappearing on investors’ radar screens. However, foreign direct investment (FDI) remains too small, around 2 percent of GDP.
As Ukrainians prepare to elect their next president later this month, whoever wins, either Poroshenko or newcomer Volodymyr Zelenskiy, he will need to focus on attracting FDI. Though the president bears responsibility for the nation’s defense, foreign policy, security service, and prosecution service, he should play a key role in attracting investors to launch their operations or manufacturing in Ukraine. Especially since both candidates are successful businessmen, the next president should watch closely that investors are welcomed and treated well.
I hear numerous success stories of businesses profitably operating in Ukraine, something that I learn day after day when speaking with our members. In March, I visited Uzhhorod, a city 500 miles west of Kyiv, for a factory expansion opening by Jabil, a global manufacturing services company headquartered in Florida. The company employs 177,000 staff globally, with 3,300 in Uzhhorod, one mile from the EU border with neighboring Slovakia. Jabil Ukraine makes hundreds of thousands of Nespresso coffee machines, those same machines advertised by actor George Clooney and sold around the world. A stone throw’s away from Jabil stands the Yazaki factory, a global automotive parts supplier. The plant produces cable harnesses for the new all-electric Jaguar I-Pace electric crossover SUV. In neighboring Mukachevo, Flex, an American multinational technological manufacturer, has a workforce of more than 3,000 people manufacturing consumer electronics that are exported around the globe.
The business community in Ukraine knows what to expect with another five years of a Poroshenko presidency. If reelected, it will likely be a business as usual approach.
We know much less about Zelenskiy. Although he is a household name, a highly talented TV performer, comedian, and a successful business owner, we don’t know how he may perform as president. His election program, thus far, is extremely thin on any details.
I met Zelenskiy a fortnight ago. He delivered a message that he is surrounding himself with reformers, the likes of former Economy Minister Aivaras Abromavicius, former Finance Minister Oleksandr Danyliuk, and MP Serhiy Leshchenko. During the meeting, Zelenskiy focused on assuring us that his views and intentions are aligned with the business community’s priorities, specifically on rule of law, macroeconomic growth, and fighting corruption.
I raised the topic of intellectual property (IP) intensive industries, something Zelenskiy understands well, as his entertainment business has made him a small fortune. IP-intensive industries with proper copyright, patents, and trademarks enable people to earn recognition and financial benefit from what they invent or create. Such industries account for over 38 percent of the United States’ GDP. This is an area where Ukraine can grow significantly.
Ukraine’s economic growth at about three percent over the past three years is positive, but the country must increase this growth significantly in order to augment national wealth. This can only be achieved by significantly boosting FDI.
Stories like Nespresso coffee machines being made in Ukraine are lost in the international media today due to the clutter and noise around the elections. Whoever wins on April 21, attracting FDI will be absolutely crucial in boosting Ukraine’s sluggish but highly promising economy.
Andy Hunder
President
AMERICAN CHAMBER OF COMMERCE IN UKRAINE
One troy ounce=31.10 grams
Lviv International Airport in March 2019 increased passenger traffic by 59.2% compared to March 2018, to 133,900 people, according to the official page of the airport on Facebook. At the same time, the number of serviced flights last month increased by 31.3%, to 1,292. Some 119,100 passengers were transported on international flights (a growth by 70.4%), and 14,800 people on domestic flights (an increase by 4.2%).
In the first quarter of 2019, some 369,400 passengers (328,800 on international and 40,600 on domestic flights) travelled through the airport, which is 53.5% more than in the same period of 2018.
The number of flights in January-March reached 3,606 (3,053 international and 553 domestic), which is 26.7% more than in January-March last year.
As reported, in 2018 passenger traffic rose by 48% compared with 2017, to 1.598 million people.
