Business news from Ukraine

FUND FOR RECONSTRUCTION, DEVELOPMENT OF UKRAINE PLANS TO CREATE REHABILITATION CENTER – PRESIDENT OF FUND ARTEM HONCHARENKO

The Fund for Reconstruction and Development of Ukraine, together with the Kontramarka Help project, plans to create a rehabilitation center for civilians and military personnel in western Ukraine, and later in other regions, president of the fund Artem Honcharenko has said.

“One of the projects that will be implemented by the Fund for Reconstruction and Development of Ukraine together with Kontarmarka Help is the creation of a rehabilitation center for civilian and military people. We plan to create it in the western region, and then scale it all over Ukraine,” Honcharenko said during press conference at Interfax-Ukraine on Thursday.
According to him, the center will provide assistance in physical and psychological rehabilitation, reintegration into civilian life, and job search.
“We have been seeing this problem since 2014, when combatants were not particularly actively recruited. Now there will be even more such people, so the problem needs to be solved in the near future,” he said.
The Fund for Reconstruction and Development of Ukraine (https://rdua.eu/) was established in April 2022 at the initiative of the International Technology Transfer Association and the I-Dolina start-up platform to organize and deliver humanitarian aid to Ukraine.

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NOVA POSHTA INVESTS UAH 5 BLN IN DEVELOPMENT

Nova Poshta Group plans to invest UAH 5 billion in development in 2022, of which UAH 1.2 billion into an innovative terminal in Odesa.
As Nova Poshta said in a report on Wednesday, the terminal in Odesa will become the company’s second largest sorting facility after its opening.
Construction work at the Odesa terminal began in June last year. The terminal will consist of two buildings – postal and freight, their total area – more than 26,000 square meters.
Active construction is currently underway: a building frame is being assembled at the cargo terminal.
“In 2022, we plan to invest unprecedented UAH 5 billion in the Nova Poshta development: in terminal infrastructure; a network of branches and post offices; in innovation. This is one and a half times more than last year. We believe in our country, we believe in its people, so we continue to develop our business and work with inspiration,” co-owner of Nova Poshta Volodymyr Popereshniuk is quoted in the report.
In March, the installation of automated equipment will begin at the terminal. These will be two main automated Vanderlande lines for sorting parcels from 2 kg to 30 kg and three lines for sorting small parcels manufactured by the Ukrainian company Konsort.
In addition, telescopic conveyors will be installed at the terminal, which drive directly into the car body and help automate the process of loading. A total of 48 such “telescopes” are planned to be installed at the terminal.
It is planned to use 50 robotic carts at the cargo part of the terminal: robots manufactured by Ukrainian SBR for moving cargo.
The terminal will begin operation, tentatively, already in November of this year. It will be able to process up to 40,000 parcels per hour, which is three times more the speed of the current terminal.
The terminal will sort the parcels for Odesa and 65 settlements of Odesa region. It will create more than 700 new jobs.
The company also said that they planned to open an automated terminal in Zaporizhia the following week.
The Nova Poshta group of companies includes, in particular, Nova Poshta, NP Logistic, NovaPay and Nova Poshta Global companies.

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EUROPEAN BANK FOR RECONSTRUCTION AND DEVELOPMENT INVESTS EUR1 BLN IN UKRAINE IN 2021

The European Bank for Reconstruction and Development (EBRD) invested EUR1 billion in the Ukrainian economy in 2021, bringing its three-year investment in the country to EUR3 billion.
“True to its ambition to become a majority green bank by 2025, some 45% of bank financing in Ukraine was in support of greater sustainability and energy and resource efficiency. Examples included a EUR140 million EBRD loan to modernize district heating and hot water supply in the capital, Kyiv, and a EUR50 million loan for Kyiv to renew the rolling stock of its metro network and support the shift from private cars to modern, efficient and environmentally friendly public transport,” the bank said.
“The bank also attracted a EUR5.5 million grant from the E5P to complement an earlier EUR25 million loan to refurbish, for greater energy efficiency, about 100 public buildings in Dnipro. Dnipro and Ukraine’s second-largest city of Kharkiv decided to accelerate their investment in green solutions by joining EBRD Green Cities, a flagship urban sustainability program, following in the footsteps of Lviv, Kyiv, Mariupol, Khmelnytsky and Kryvy Rih. Ukraine has more cities taking part in the program than any other economy in which the EBRD invests,” the report says.
“In the private sector, the bank teamed up with Kernel Group to help strengthen the company’s climate corporate governance. It is also supported the development of low-emission sustainable property by backing the real-estate portfolio of Dragon Capital, an investment firm,” according to the document.
“The bank joined forces with the European Union in extending grants to innovative Ukrainian firms seeking to improve climate resilience. The beneficiaries included a producer of recycled plastic The Good Plastic Company, architecture studio Ekodar, yeast producer Enzym, engineering firm Dominion, water and rainwater management company Viva Victoria and The Laboratory of Advanced Jet Propulsion, an institution focused on rocket and spacecraft technologies,” it says.
“The EBRD’s efforts to advance the sustainability of Ukraine’s economy were encouraged by the country’s newly reviewed Nationally Determined Contribution. The EBRD helped to develop the policy document and stands ready to help set out a low-carbon and climate-resilient pathway for the power generation sector in Ukraine,” the bank noted.
“In addition, the EBRD invested $ 75 million in a $825 million eurobond placed by Ukrenergo, the state-owned electricity transmission system operator, in a bid to resolve the payments crisis gripping the country’s renewable energy sector. The first ever sustainability-linked bond issued by a Ukrainian company, it helped restore the credibility of the Ukrainian renewable energy sector, paving the way for much-needed investment to support the country’s green transition. In the infrastructure sector, the EBRD approved a new EUR190 million loan tranche for further improvements to the country’s roads. This follows efforts by Ukravtodor and the Ukrainian authorities to implement a comprehensive anti-corruption program,” it says.
“This is part of the EBRD’s broader work to promote corporate governance reform in state-owned enterprises and to strengthen their supervisory boards. In a further move to promote greater private-sector participation in the development of infrastructure, the bank joined forces with the International Finance Corporation (IFC) on a new advisory engagement with the Ministry of Infrastructure to help structure private-public partnerships in the road sector and to prepare the concession of selected terminals at Chornomorsk port,” it reads.
“Standing by its long-time partner, the city of Lviv, the bank provided emergency funds to ensure that the vital infrastructure is safe and functioning during the ongoing pandemic. As social distancing measures remained in place, the EBRD supported companies that facilitated remote entrepreneurship and helped people to stay in touch, such as state-owned postal service Ukrposhta and its privately owned peer, Nova Poshta, as well as Datagroup, a provider of fibre infrastructure and digital services,” the report states.
“Recognizing the importance of better access to credit and trade finance, the EBRD channeled EUR357 million to seven local lenders: Ukrgasbank, Raiffeisen Bank Ukraine, Ukreximbank, OTP Bank, ProCredit Bank, Credit Agricole and Bank Lviv. Backed by EU investment incentives, the bank increased lending for small and medium-sized enterprises via partner banks under the EU4Business-EBRD credit line,” it reads.
“It also delivered record volumes of trade finance as part of the Trade Facilitation Program. Furthermore, the bank financed successful Ukrainian companies such as car importer Winner, Kokhavynska Paper Factory and gas trader ERU Trading. It also teamed up with USAID and the American Chamber of Commerce to develop an action plan for the consolidation of infrastructure for the capital and commodities markets,” according to the bank.

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TURKISH BOSPHORUS DEVELOPMENT PLANS TO ENTER UKRAINIAN MARKET IN EARLY 2022

An exclusive interview with Mehmet V. Sacaklioglu, the founder & chairman of the Bosphorus Development supervisory board, for Interfax-Ukraine

Tell us about Bosphorus Development.

Our company is one of the largest investment and development companies in Turkey. My grandparents started a business in the 1930s. I am a representative of the third generation. The family business started with retail, then the company launched other business activities, including the opening of a network of grocery stores, restaurants and bakeries, production of furniture, textiles, as well as gas supply and trade in petroleum products.
Our company implemented the first development project in 1970. More than 5 million square meters of real estate have been built, more than a hundred projects have been completed in 51 years.
Among the landmark projects for us are Istanbul Aquarium – one of the largest themed aquariums in the world, with a total area of 23,000 square meters, and the largest business center Istanbul Tower 205 (220 meters high, 246,000 square meters).
We have our own architectural team, but we also work with the world’s best architects. In particular, for Istanbul Tower 205, we considered the proposals of many leading architects around the world, but focused on the project of the American company Skidmore, Owings & Merrill (Burj Khalifa in the UAE, One World Trade Center in New York, Tianjin CTF in China).
We have also built several malls, the Crowne Plaza Istanbul hotel and about a hundred business and premium class residential projects. Today, six facilities in Istanbul are under design and initial implementation.

Why did you choose Ukraine to expand your development direction?

I have been living in Ukraine for 20 years, married and raised two children here, graduated from the Institute of International Relations of the Taras Shevchenko National University of Kyiv. Ukraine is my second homeland. During these years I’ve developed business in various directions, but now decided to focus on development.
In Ukraine, we already have a fairly large land bank. Today it includes four land plots, we are negotiating the purchase of three more land plots. Before the start of construction work, we would not like to name the locations. I can only say that all the sites are located in the central part of the capital.

What characteristics must a land plot have to be interesting for your company?

Many factors are important for the implementation of a successful project: location, infrastructure, transport links, the availability of social facilities and others. The size of a land plot must be at least 1 hectare, but if the location is very interesting, it may be less. A necessary condition is that it must be impeccable from a legal point of view. To establish the compliance of a land plot with our standards and requirements, we necessarily conduct due diligence, they were made for us by well-known international companies such as Baker McKenzie, Ernst & Young, DLA Piper.
Unfortunately, there are no completely “white” areas in the capital, without potential conflicts.
If this is true, it may be one of the reasons why there are very few international developers in Ukraine.
Ukraine and Turkey have historically had very good relations, with Turkish companies actively involved in the construction of important infrastructure facilities in Ukraine, but Bosphorus Development will be the first Turkish development company to implement projects of this scale in the Ukrainian capital.

Which construction sector did you choose to invest in? What projects do you plan to implement?

As I mentioned, we have experience in implementing projects of any complexity and different types: housing, hotels, trade, commercial real estate, infrastructure and others.
Our first project in Kyiv will be a multifunctional residential complex with commercial and social facilities. It will be business class housing, with interesting and original architectural solutions, with the use of high-quality materials, in harmony with the environment, with a well-thought-out and useful infrastructure for residents. The project has already been developed by our architects in collaboration with Ukrainian colleagues.
In the construction of our facilities, we use only high-quality and environmentally friendly materials that have undergone thorough inspection, examination and certification. In Turkey, we have our own production of construction and finishing materials. For example, all wood elements and constructions in our projects are our own.
In Ukraine, we are currently studying manufacturers and suppliers of construction materials, analyzing which Ukrainian materials to use and which to import. As an example, the quality and characteristics of Ukrainian finished granite completely suits us. As for ceramic granite – we choose between Turkish, Italian and Spanish manufacturers. Windows and facades – there are several representative offices of Turkish and German manufacturers in Ukraine, we are studying their proposals. If we control the whole process of materials production and if they fully meet our requirements, then, perhaps, we will make a choice among Ukrainian manufacturers.

When will you present the projects and start their construction?

The construction of our first project will start in the first quarter of 2022, then we will talk about it in more detail, make a presentation. Our second project, no less large-scale – at the end of 2022.
How many staff do you have in the company in general and how many will work in Ukrainian projects?
The Turkish staff is over 1,500 people. In Kyiv, we are currently recruiting a team for the first project, and plan about a hundred employees at the initial stage. If necessary, we will bring highly qualified specialists from Turkey – management, engineers, architects, builders and others. We are studying this issue in terms of the quality of work and professionalism of local staff. About 500 employees will be needed to implement our initial projects.

Are you planning to certify your projects according to “green” standards?

Most of our projects in Istanbul are certified according to LEED standards. For example, Istanbul Tower 205 meets the LEED Platinum quality standard. Regarding Ukrainian projects, we are currently in the process of negotiating and choosing a certification system.
How much will be invested in the implementation of projects?
After the official presentation of our projects, we will launch sales, but regardless of the activity of buyers in the real estate market and potential investors, regardless of the economic situation in Ukraine, we have enough financial resources to complete and implement them in a timely manner.

 

 

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UKRAINIAN MEDICAL COMPANY ADONIS STARTS DEVELOPMENT OF ITS FRANCHISE NETWORK

The medical company Adonis has begun implementing a strategy for the development of its franchise network.
General Director of the company Vitaliy Hyrin told Interfax-Ukraine that the strategy is being implemented in two formats – a medical center and points for collection of laboratory tests.

“We have two options: a small medical center with an outpatient appointment, or a collection point – a manipulation room. They will work under our Adonis brand and comply with all the rules and requirements of corporate culture. At the same time, we will control our franchisees,” he said.
According to Hyrin, Adons has already attracted three franchise partners to open a large medical center with surgery and two collection points. By the end of the year, it is planned to open up to ten collection points in different regions of the country.
Answering the question of who can be the Adonis franchisee, Hyrin said that it can be “both people from medicine, as well as people from outside the healthcare sector, whom we are ready to accompany and to help.”
“Among our potential franchisees may be medical workers, for example, a doctor who wants to open his office, or a medical facility. We are ready to help at any stage, from obtaining a license to supporting operational activities. Also, our franchisees can be owners of premises who want to develop a medical business in them. In this case, we are ready to help with all medical issues. The only condition: our partner must understand that he will be engaged in the development of his business, this is not about making passive investments,” he said.
Adonis is a network of private full-cycle medical centers for adults and children.
The private clinic Adonis was established over 20 years ago. Its network includes ten branches in Kyiv and the region, including two of its own maternity hospitals and a stem cell laboratory. In the branches of the clinic, doctors conduct appointments in 60 medical directions.

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