Business news from Ukraine

Business news from Ukraine

EU ADVISES ALL AIRLINES TO AVOID BELARUSIAN AIRSPACE

The European Union Aviation Safety Agency (EASA) has recommended that EU air carriers and non-EU airlines avoid Belarusian airspace, Western media outlets reported on Wednesday, citing the EASA.
Non-EU airlines authorized by the EASA when conducting operations to, from, and within the EU are advised to avoid operating in Belarusian airspace, it said.
The agency cited safety reasons following the May 23 Ryanair flight incident, which called into question the ability of the Belarusian authorities to provide safe air navigation services.
A Ryanair flight from Athens to Vilnius was forced to land at the Minsk airport while passing through Belarus’s airspace on May 23. It was reported that the plane landed after the Belarusian security services were warned of a bomb threat. Belarusian President Alexander Lukashenko ordered that a MiG-29 fighter jet be scrambled to shadow the passenger plane, which was carrying Roman Pratasevich, editor of the Telegram channel Belarus Golovnogo Mozga (Belarus of the Brain) and former editor of the Telegram channel Nexta, both designated as extremist in Belarus, and his girlfriend Sofia Sapega, a Russian citizen and student of the European Humanities University based in Vilnius. The Belarusian authorities have detained both of them.

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UKRAINE EXPECTS EU TO REVIEW NEIGHBORHOOD POLICY

Ukraine expects the European Union to revise its Neighborhood Policy, and that this revision will affect all the countries of Eastern Europe, said Olha Stefanyshyna, Deputy Prime Minister of Ukraine for European and Euro-Atlantic Integration.
“We expect that in 2022 the European Union will start revising the Neighborhood Policy, and this revision will affect all Eastern European countries; that a specific new format of cooperation will be developed for Georgia, Ukraine and Moldova, countries aspiring to membership [in the EU]. And we expect that by 2027, when Lithuania assumes the presidency of the EU Council, it will be possible to come up with specific political decisions,” she said during an online discussion of Kyiv Forum, founded by the Arseniy Yatsenyuk Foundation entitled “Discover Ukraine.”
Stefanyshyna noted that Ukraine positively assesses the current situation of relations with the EU. “At the same time, we believe that the time has come to start revising the Neighborhood Policy. We hope that this work will begin in 2022. And I know that many in European capitals are ready to join this work, and Ukraine will be able to get the prospect of membership [in EU],” she stressed.
At the same time, she noted that “there is really fatigue from expansion, and we feel it in our capitals.”

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HEAD OF PRESIDENT’S OFFICE OF UKRAINE INVITES AMBASSADORS 0F G7 COUNTRIES AND EU TO JOIN TO GOVERNANCE REFORM OF STATE-OWNED COMPANIES

Head of the President’s Office of Ukraine, at a meeting with the ambassadors of the G7 countries and the European Union, informed the diplomats about the progress of the corporate governance reform of state-owned companies, the press service of the head of state said on Thursday evening.
“The Head of the President’s Office invited the ambassadors and their countries to join the preparation of the draft law on improving corporate governance of legal entities, the shareholder of which is the state, which will ensure the implementation of modern international standards in Ukrainian legislation,” the message says.
In turn, Deputy Head of the President’s Office Yulia Svyrydenko noted that the goal is to clearly delineate the functions of the state as a shareholder and to prescribe transparent criteria for evaluating supervisory boards.

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PRESIDENT OF UKRAINE: WE OFFER FRANCE TO SIGN DECLARATION OF OUR SUPPORT TO ACCESS EU

President of Ukraine Volodymyr Zelensky offered French President Emmanuel Macron to sign a declaration of support for Ukraine’s accession to the European Union.
“We have made a declaration that we conclude with partner countries, member states of the European Union, in which this or that country signs a declaration with us, indicating its support of Ukraine in striving to be a member of the European Union. Frankly speaking, several countries have already signed this declaration. There are countries that are now reviewing this declaration. I told the details of this declaration. I suggested that France also support Ukraine. I believe that President Macron will get acquainted with this declaration and give his answer,” Zelensky said at a briefing on the results talks with French President Macron in Paris on Friday.
Zelensky also said the Declaration on the European Perspective of Ukraine is an initiative of our state, which “does not want to wait until everything is done for us.”
“We are very proactive in Ukraine. We do not wait for everything to be done for us. We ourselves are taking concrete steps,” Zelensky said.
As reported, on March 18, a meeting of the presidents of Ukraine and Lithuania took place, during which they signed a Declaration on the European perspective of Ukraine.

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UKRAINE MAY LOSE EUR 700 MLN FROM DECREASE IN EXPORTS OF METAL PRODUCTS DUE TO SOME RESTRICTIONS

Ukraine may lose EUR 700 million due to restrictions on the supply of Ukrainian metal products as part of the introduction by the European Union of the Carbon Border Adjustment Mechanism (CBAM), according to a study by the information and analytical center GMK Center presented at a roundtable devoted to the impact of CBAM on the metallurgy of Ukraine held on April 9.
According to the press release, early March 2021, the European Parliament approved a resolution introducing the Carbon Border Adjustment Mechanism (CBAM). The European Union regards the CBAM as a special fiscal instrument that will force manufacturers of imported products to pay the same price for CO2 emissions that European producers pay. The official proposal for CBAM from the European Commission is expected to appear by the end of the second quarter of 2021. CBAM is planned to be in effect no later than 2023.
According to the study conducted by analysts of GMK Center, the negative impact on the metallurgy of Ukraine from the introduction by the European Union of the CBAM can reach EUR 700 million, or 0.5% of the gross domestic product compared to 2019.
“The metallurgical industry of Ukraine will be one of the most affected as a result of the introduction of CBAM. This will happen due to our close partnership with the EU. After all, domestic metallurgists supply 26% of marketable products to the European market, which is more than to our domestic market. Our competitors do not have such a high dependence on the EU market. The introduction of the CBAM will mean a decrease in the competitiveness of Ukrainian exports, losses for the domestic economy, a rupture of production chains between European and Ukrainian enterprises,” Director of GMK Center Stanislav Zinchenko said.
According to him, the annual export losses of Ukrainian metallurgy from the introduction of CBAM by the European Union are estimated at EUR 155-200 million per year, depending on the scenario. It will also reduce the financial results of the industry by EUR 105-200 million per year.
The CBAM covers about EUR 2.5 billion of metallurgical exports per year. The exact scale of damage to national producers depends on the form of implementation of the CBAM.
As a result of the effect of the carbon tax, one can expect a decrease in the volume of pig iron production by 500,000 tonnes (2.5% down compared to the level of 2019) and long products (including square billets) by 110,000 tonnes (1.4% down).
According to Chief Analyst at GMK Center Andriy Tarasenko, this could also lead to a decrease in the volume of capital investments in the amount of up to EUR 130 million per year (12% down compared to the level of 2019). In the long run, this will mean chronic investment lag and a competitive disadvantage.
“The CBAM should not be applied to Ukraine, since we have already taken on the goals of the European Green Deal. The exclusion of Ukraine from the CBAM, on the contrary, will be an incentive for the Ukrainian economy,” Zinchenko said.

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EUROPEAN COMMISSION OKAYS DRAFT COUNCIL DECISION ON COMMON AVIATION SPACE WITH UKRAINE

The European Commission (EC) has approved the Council’s draft decision for the signing of the Agreement on the Common Aviation Space with Ukraine, said representative of Ukraine to the European Union, Ambassador Mykola Tochytsky.
“Long awaited good news: today EU Commission has re-approved the draft Council Decision on the signing of the Common Aviation Area Agreement. Looking forward to member-states’ support and swift conclusion of the Agreement,” the Ukrainian diplomat wrote on Twitter.
Next steps are the approvement by the Council of the EU and actual signing of the Agreement. The agreement will be signed between Ukraine, the EU and the member states.
The conclusion of the Agreement will contribute to the creation of a common aviation space between Ukraine and the EU based on common and reliable EU standards in the field of flight safety, air traffic control and consumer protection, the press service of the Mission of Ukraine to the EU reported on Facebook.
“It will also open new opportunities for our citizens and business as well as investments into Ukrainian aviation. Common Aviation Area will ensure the air operation in Ukraine in line with the EU standards on aviation safety, air traffic management and aviation consumer protection,” the Ukrainian diplomats said.

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