The challenges of the Ukrainian economy are related to the lack of insurance and it is already obvious that this hinders the attraction of investors, who first of all think about the protection of their capital.
This opinion was expressed by the US Special Representative for Ukraine’s Economic Recovery Penny Pritzker at the Ukraine Recovery Conference (URC2024) in Berlin on Wednesday.
“We all understand: in order for private investors to come in, insurance is needed. This is the first thing an investor thinks about,” she said.
According to Pritzker, she and her team took this as a call to action It was seconded by the US-based Development Finance Corporation (DFC) and global reinsurance broker Aon, which found practical innovative solutions to the issue. DFC already provides an insurance product designed for SMEs.
“We have purposely built an insurance model that is scalable. However, for this sector to flourish in Ukraine, many players are needed. I will encourage other insurance organizations, international institutions to think how they can join this model. I am confident: this mechanism will bring to Ukraine the necessary capital for its economic growth both when there is a war and when there is peace and reconstruction begins,” she emphasized.
According to DFC Executive Director Scott Nathan, before the war the corporation had a large portfolio in Ukraine, including risk insurance. Currently, to support the private sector and the country’s economy, one of the important toolkits in its portfolio is political risk insurance, which has closed $350 million worth of arrangements for three contracts in agriculture, manufacturing and education over the past year.
“Together with our partner ARCS, we as DFC can provide $50 million in war risk insurance, air raid risk, etc. to different clients. These can be small policies that can go to larger policies,” he noted.
At the same time, Nathan said that projects are being developed with Aon that can be scaled. One such project will be announced soon.
“Practically, we are helping local insurance companies build capacity for the country. Insurance is a mechanism to mobilize capital in the country and we hope to offer such an innovative tool. This is just the beginning, just part of our joint efforts to invest in Ukraine’s future, to lay the foundation for future investments when its recovery and reconstruction begins. It is important for the economy to work every day already now, during the war, and for this we need to build capacity in the insurance market. This is the key to success,” he said.
According to Aon President Erik Andersen, it is very important to provide protection by Ukrainian insurance companies, as well as to have a mechanism of pooled resources to provide insurance in the health care system, for small businesses, etc.,” he said.
“What we are saying is that we wanted to participate and invest our capital through the DFC, through local insurers. We have been working in Ukraine for a long time, it’s a big insurance program, and we want this capital to go to companies that operate in the country,” he said.
The volume of cargo transportation in containers in Ukraine in January-May 2024 reached the highest value for the last seven years and exceeded the pre-war indicators, follows from the analytical note of “Ukrzaliznytsya” (UZ), prepared for the meeting on the topic of intermodal transportation.
“In the first five months of 2024, the volume of cargo transportation in containers increased by 60% compared to the same period of 2023 and amounted to 116.129 thousand TEU (20-foot containers). The indicator is the highest for the last seven years and exceeds the volume of transportation for the same period in 2021 by 10%,” the document says.
It is indicated that in 2021, about 16% of the volume transported in containers accounted for transit, which is now virtually absent.
The main nomenclature in containers remains grain cargoes – 39%, as well as ferrous metals – 15%; cakes – 7%; oil – 6%; synthetic resins – 4%; sugar – 3%, chemicals – 2%.
During the period, about 25% of cargo in containers was transported in the import direction, 61% – in the export direction, 14% – in the domestic direction.
Since March 2023, UZ has been offering users of transportation services a new intermodal service that combines the transportation of container trains, contrailer trains and combined transport trains.
As of June 12, 2024, UZ transported 412 intermodal trains: 72 intermodal trains in the direction of Polish and Romanian ports and 340 such trains in the direction of Ukrainian ports.
It is also reported about changes in the terms of service provision. According to them, operators of intermodal train can postpone the date of its departure in one day, and operators staying outside Ukraine will be able to use UZ fitting platforms at domestic rates.
PJSC “Yuriya” (Cherkassy), producer of dairy products under TM “Voloshkove Pole”, has invested EUR1.6 mln in modernization of production facilities of its enterprises and put into operation a new line for production of glazed cheesecakes, said the general director of the enterprise Andrey Tabalov.
“This is one of the largest investments of the enterprise in 2024 in the amount of EUR 1.6 mln. Lithuanian automated line “PAKMA” will allow to produce additional 4 thousand cheesecakes hourly. It will increase the production capacity of glazed cheesecakes by 40%. This large-scale investment was planned within the framework of modernization of PJSC “Yuria” for 2024 and is a conscious decision in such a difficult time for the country, – he wrote in Facebook.
As reported, the producer of dairy products under TM “Voloshkove Pole” in 2023 invested EUR1.5 million in the installation of the line “Tetrapak” to double the production of ultra-pasteurized milk, which intends to sell on the domestic market and export.
The company posted a UAH 46.773 million net loss in 2023, compared with a net profit of UAH 85.34 million a year earlier. The company’s revenue decreased by 1.35% to UAH 1.6 billion, assets by 1.5 times to UAH 1.048 billion, and debt obligations by 24.7% to UAH 1.279 billion. At the same time the number of personnel increased by 14 people to 913 employees.
Yuriya PJSC is the successor of Cherkassy Municipal Dairy Plant with a design capacity of 25 tons of raw material processing per day.
The company has subsidiaries “Yuriya-2” – a network of branded stores and kiosks in Cherkassy and “Yuriya-trans” – a trucking company, which delivers raw materials and materials for processing, products to retail outlets, as well as provides other transportation services.
The raw material area of the company is Cherkassy, Kirovograd, Poltava, Kyiv and Vinnitsa regions. Milk is collected in more than 200 settlements.
The beneficiaries of the enterprise are Alexander and Andrey Tabalovs.
Strokes in Ukraine have grown younger by 10-15 years during the war, Health Minister Viktor Lyashko has stated.
“I can now go into the discussion and show the figures of the growth of strokes, to which leads exactly stressful situations in which we are. We can already today confirm the studies of the past years that the country where there is a war, strokes are getting 10-15 years younger,” he told the Ukraine Recovery Conference (URC2024) in Berlin on Tuesday.
Lyashko noted that “a completely different age group gets such diseases.”
Export changes in % to previous period in 2023-2024
Source: Open4Business.com.ua and experts.news
Ukraine exported almost 3.8 million tons of sunflower meal in the first nine months of the 2023-2024 maketing year (starts in July), which is 23% more than in the same period last season. As the information and analytical agency APK-Inform reported, this figure was the maximum value for September-May in the last four years.
“The main importer of Ukrainian meal in the current season remains the European Union with a share of 45% (39% in the previous MY). Exports of meal in September-May 2023/24 MY in this direction increased by 41%, while to China decreased by 12%,” – said the analysts.
The experts recalled that the European Union approved a “safeguard duty” on imports of most grains, oilseeds and processed products of Russian and Belarusian origin in the amount of EUR95/ton of imported products to the EU, coming into force on July 1.
“In the oilseeds sector, the markets for meal may be affected the most. The export volumes of these products of Russian origin to the EU have been significant and it will be quite problematic to reorient them to other markets. But, given the geographical proximity to the global world importer – the Asian market, some volumes may be reoriented in this direction, in particular, to China”, – they predict.
They noted that in the new season, competition in the Chinese market is expected to intensify, which may lead to further reduction of Ukrainian sunflower meal in favor of Russian sunflower meal.
At the same time, this situation may have a positive impact on the volume of Ukrainian sunflower meal shipments to the European market. EU countries in the current season increased imports of Ukrainian product by 6%, up to 1.2 million tons (for July-May 2023/24 MY – data of the European Commission), but the volume of imports of Russian product for the same period also increased by one third – up to 775 thousand tons.
The EU “safeguard duty” may also have a good impact on the Ukrainian rapeseed meal market, especially ahead of the start of rapeseed processing. Thus, for this sector, the EU is the key sales market with a share of about 73%, and where the Ukrainian product competes quite seriously with Russian and Belarusian products. In particular, the share of Russian rapeseed meal in the total import of this product by the EU countries is 41% in the current season, Belarusian – almost 32% and only about 21% is Ukrainian meal”, – summarized in ‘APK-Inform’.
