Business news from Ukraine

ODESA ENERGY AGENCY TO RAISE EUR400,000 FROM NEFCO FOR ENERGY MODERNIZATION OF CITY OBJECTS – GIZ

KYIV. Nov 11 (Interfax-Ukraine) – Odesa Municipal Energy Agency intends to attract credit funds in the amount of approximately EUR400,000 from the NEFCO (The Nordic Environment Finance Corporation) for energy efficiency and energy saving measures.

Such data were promulgated by director of the project “The establishment of energy agencies in Ukraine” Robert Kuenne during the eleventh international congress “Institutional and technical aspects of reforming housing and utilities services 2015” in Kyiv.

“All these measures will be set out in the business plan, which will be available online. The total amount of funds required for the implementation of the business plan is about EUR400,000,” he told reporters.

According to the expert, Odesa energy agency plans to use the funds for the energy modernization of two kindergartens and increase energy efficiency in several budgetary institutions, as well as the modernization of street lighting.

KYIV AUTHORITIES TO INCREASE ROAD REPAIR FUNDING BY 30% IN 2016 – KLITSCHKO

KYIV. Nov 11 (Interfax-Ukraine) – The Kyiv authorities plan to increase funding for road repairs by at least 30% in 2016 compared to 2015, Kyiv City Administration has reported, referring to its Head Vitali Klitschko.

“There are many roads in Kyiv that require repair. We’re increasing the financing in 2016. We plan to increase it by at least 30% compared to 2015,” Klitschko said.

He said that the 2015 Kyiv city budget foresees the allocation of over UAH 1 billion to finance the road sector in the city.

He said that in 2015 the Kyiv authorities, for the first in the past years, paid attention to repairing roads in residential areas and building-adjacent territories: 570 cases of repair were registered in January-October 2015.

Klitschko also said that new road covering will be more wear-resistant and would not require repair for at least the next five years.

UKRAINE INTENDS TO PRIVATIZE ALUMINUM FOIL FACTORY

KYIV. Nov 11 (Interfax-Ukraine) – The State Property Fund of Ukraine (SPF) has included the integrated property complex of state-owned enterprise Aluminum Foil Factory (ZAF, Zaporizhia) in the list of objects subject to class A privatization (small privatization).

According to a fund report in the Vidomosti Pryvatyzatsii newspaper, the plant is to be sold at auction.

Under current regulations, the agency will have to select an appraiser to estimate the object before its auction.

As reported, the then state Zaporizhia Aluminum Combine (ZAlK) in 1995 attracted a $76.45 million loan under state guarantees to build a plant producing aluminum foil for food packaging, the equipment for which was supplied by Italy’s Fata. It was assumed that the production capacity will allow production of 36,000 tonnes of packaging a year, including 27,000 tonnes of smooth aluminum foil. During the subsequent privatization of ZAlK the unfinished plant was not included in its charter capital, remaining in state ownership.

GIZ PILOT PROJECT TO CREATE TWO MUNICIPAL ENERGY AGENCIES IN UKRAINE COSTS EUR3 MLN – PROJECT DIRECTOR

KYIV. Nov 11 (Interfax-Ukraine) – The cost of a pilot project of the German Society for International Cooperation (Deutsche Gesellschaft fur Internationale Zusammenarbeit, GIZ) on the establishment in 2014-2017 of two municipal energy agencies in Ukraine amounts to EUR3 million, director of the project “The establishment of energy agencies in Ukraine” Robert Kuenne has reported.

“In general, this project, which will last four years from 2014 to 2017, is worth EUR3 million,” he told reporters during the eleventh international congress “Institutional and technical aspects of reforming housing and utilities services 2015” in Kyiv.

The expert noted that GIZ does not provide funds for projects, but provides technical assistance, consulting and informational support to project teams.

According to him, within the project such first Odesa Municipal Energy Agency created by GIZ in cooperation with the local authorities in Odesa began work in April 2015.

Today GIZ keeps the plan to open the second municipal energy agency in Donetsk region after the Ukrainian government resumes control over the region, he added.

UKRAINE MAKING GAINS AS REGIONAL REFORM OUTLOOK BRIGHTENS – EBRD REPORT

KYIV. Nov 11 (Interfax-Ukraine) – Ukraine has made the most progress in cleaning up its banking system and making it more resilient to future shocks among the countries in the region of the European Bank for Reconstruction and Development (EBRD), reads a report posted on the bank’s website.

“Despite continuing problems with non-performing loans, there are positive developments among financial sectors as countries have cleaned up their banking systems and made them more resilient to future shocks. Among these countries, Ukraine has made the most progress. Since 2014, the country has seen the closure of over 50 banks with opaque ownership structures, excessive related party lending and weak management and corporate governance,” reads the document.

However, according to the bank experts, the banking sector in Ukraine will remain under pressure due to a strong devaluation of the hryvnia and increased credit risks.

“Recapitalization of banks is continuing, and regulatory measures have been taken, including rules on lending to related parties to make the banking sector more stable,” the report states.

POLAND’S LOT AIRLINE TO LAUNCH REGULAR FLIGHTS BETWEEN KHARKIV, WARSAW ON MARCH 1

KHARKIV. Nov 10 (Interfax-Ukraine) – Poland’s LOT airline will start servicing direct regular flights on the Kharkiv-Warsaw route on March 1, 2016.

The press service of Kharkiv international airport reported on Monday that Embraer planes will service the flights five times a week. The departure time from Kharkiv is planned in a way to allow passengers access to as many as possible connecting flights to North America and Europe.

“The resumption of direct flights between Kharkiv and Warsaw is of large importance from the point of view of developing business communication between the two countries and for tourism. Taking into account experience, one can say for sure that this route is of large demand. The interest of Ukrainian and Polish citizens in the route is stably high. In particular, only in 2014, the General Consulate of Poland in Kharkiv issued over 65,000 visas,” the press service said, citing Director General of Kharkiv airport Volodymyr Vasylchenko.

Kharkiv will be one of the first new cities LOT will fly to after it finishes its restructuring. Along with the launch of flights to Kharkiv, LOT will also launch flights to Tokyo, Seoul, Barcelona, Zurich, Venice, Athens, Nice, Beirut, Ljubljana, Cluj-Napoca, Palanga and Kosice.