National bank of Ukraine’s official rates as of 03/08/20
Source: National Bank of Ukraine
The current account of the balance of payments in April-June posted a record-hitting surplus of $4.3 billion, according to the inflation report of the National Bank of Ukraine (NBU), posted on its website last week. “In H1 2020, exports showed greater resilience to the effects of the crisis than imports, among other things due to relatively more stable external demand for foods. In contrast, imports of goods and services plunged as domestic demand narrowed, energy prices fell further, and tourism halted,” the NBU said.
According to NBU estimates, the consolidated balance of payments of Ukraine in the second quarter showed a deficit of $100 million, while in the April forecast the regulator expected a surplus at the level of $200 million.
According to the report, the export of goods and services in the second quarter decreased by 12.1% compared to the same period last year (year-over-year), to $13.2 billion, including due to weakening global economic activity, depletion of stocks of certain grains and low global prices for metals and corn.
In general, the export of food products in the second quarter of 2020 decreased due to the rapid depletion of corn and soybeans, high competition in the grain market and a decrease in demand from biofuel producers, as well as, despite an increase in the supply of fertilizers and plastics, exports of chemical products decreased amid deteriorating external pricing environment.
In addition, the decline in exports of metallurgical products plunged due to a further contraction of external demand and a decrease in global prices and exports of engineering products, including due to a decrease in external orders for the supply of railway cars.
According to the document, by the end of April-June 2020, imports of goods and services fell sharply (by 27.7% year-over-year) due to a significant narrowing of domestic demand and the closure of borders, to $12.3 billion. In particular, imports of products engineering decreased significantly, and the decline in imports of components for alternative energy has increased due to uncertainty regarding the legal framework for this type of activity.
Imports of industrial products also decreased amid weakening consumer demand, while imports of food products continued to grow. In addition, imports of chemical products decreased as a result of an increase in domestic production of fertilizers, which was lower than the volume of purchases of household chemicals, as well as amid lower prices for energy. According to the NBU, the decline in energy imports has also deepened due to the decline in prices (by almost 50% year-over-year).
Despite the expected decline in the volume of transfers, their fall was less than forecast (up to 60% year-over-year) – it was 15.3%. “This was facilitated by the active return of Ukrainian workers to work abroad and a more stable demand for labor migrants in recipient countries (in particular Poland),” the NBU said.
According to the forecasts of the central bank, the current account of the balance of payments in Q3 2020 will be with a surplus of $400 million, in Q4 – with a deficit of $600 million, and by the end of the year the surplus will amount to $6.5 billion.
According to NBU estimates, the consolidated balance of payments of Ukraine at the end of Q3 will be reduced to zero, at the end of Q4, the surplus will amount to $400 million, and in 2020 – $1.5 billion.
The distribution chain UkrAgro NPK and Nika-Tera sea terminal (Mykolaiv), both are parts of Group DF, have jointly opened the first agricultural supermarket – a wholesale and retail warehouse store of agricultural products in the territory of the port.
Group DF said in a press release on Friday, July 31, that the outlet is fully equipped for reception, storage, packing and shipment of goods. Its targeted audience includes customers of the port and farmers from Mykolaiv and Odesa regions.
“At the beginning, the assortment of products includes various types of nitrogenous and mixed fertilizers that fit various types of package. We plan to gradually extend the assortment by seeds, plant protection agents, and other chemicals. In future we will sell other goods and services that are necessary for farmers, agricultural producers, traders,” Director General of UkrAgro NPK Volodymyr Dovbnia said.
The new outlet de jure is an official representative office of PJSC UkrAgro NPK.
UkrAgro NPK is a large chain of warehouses selling mineral fertilizers in Ukraine. It has been a part of Group DF since 2012.
Austria has canceled the ban on landing aircraft from Ukraine since August 1, but the general regime of entry for Ukrainian citizens into this country remains unchanged – entry for tourism purposes will remain banned, Ukrainian Ambassador to Vienna Oleksandr Scherba has said.
“I have two news – good and bad. The good news is that starting from August 1, Austria will lift the ban on landing aircraft from “at-risk countries,” including Ukraine. The bad news is that it looks like the general regime the entry of Ukrainians into Austria remains unchanged, that is, there is no tourism. Those who have a residence permit, those who fly for special family reasons (wedding, family reunification, funeral…), as well as for urgent treatment can enter. They must have a fresh COVID-19 test taken,” he wrote on Facebook on Friday.
According to Scherba, an official note on the new regime is expected on Saturday.
“I know that there are a lot of questions from Ukrainian students who have just entered Austrian universities, therefore they do not yet have a residence permit. I don’t have an answer about the order of their arrival yet. If I have, I’ll write,” the diplomat said.
On Thursday, July 30, the press center of the Interfax-Ukraine News Agency hosted a press conference, titled “Who Destroyed Ukraine’s Horse Breeding, and Why? How to Save the Industry? The Opinion of the Heads of Horse Breeding Enterprises.” The conference was attended by Director of Oleksandria stud farm of SE Horse Breeding of Ukraine Oleh Rodionov, Director of Dubrovsky stud farm of SE Horse Breeding of Ukraine Vadym Danylevsky, Director of Lozovsky stud farm of SE Horse Breeding of Ukraine Ihor Dubovyk, former Head of Odesa Hippodrome Kostiantyn Savchyts, President of the Anti-Corruption Entrepreneurial front Ihor Yehorov, lawyer of JSC Ri Group Sabina Knysh, as well as other directors of state-owned horse breeding organizations.
“We have gathered to tell Ukraine and people what is happening at the strategic enterprise. We will not ride to the Olympics on a pig. And such stud farms as Derkulsky, where ten generations of grooms, coaches, jockeys worked, have been completely ruined,” Oleksandria stud farm director Oleh Rodionov said.
Ihor Dubovyk, the director of the Lozovsky stud farm of SE Horse Breeding of Ukraine, said today the horse breeding industry is primarily based on state stud farms. He called on industry representatives to unite and convey their position to the authorities. According to him, the industry urgently needs to put things in order and provide state support to horse breeding.
“During the reform of the agro-industrial complex, livestock breeding in general, and especially horse breeding, suffered the greatest losses. Horses were distributed, sold, and wages were paid with horses. Until 1997, there were two stud farms and 18 pedigree horse farms in Ternopil region. To date, there is not a single stud farm and not a single breeding farm. Now horse breeders have to travel to the villages and beg, as there is simply nothing to feed the horses. What is this if not a crime?” Director of the Western Plemkonetsentr branch Yuriy Volynets said.
According to lawyer Sabina Knysh, on the basis of the documents received by the new management of the state enterprise, it was established that the heads of the stud farms of Luhansk region (Striletsky, Lymarivsky, Derkulivsky, Novooleksandrivsky) committed a number of offenses, with the use of state property, illegal operations for sowing, harvesting and selling crops in land plots owned by the Horse Breeding of Ukraine. It was also established that the managers appointed by Zinchenko K.M. have a criminal record, and that some were convicted of serious crimes.
“The schemes for the illegal receipt of profits from state lands are run by the local farmer-authority Khabib Makhachevich Batirsultanov, whose wife works in the prosecutor’s office of Luhansk region, and the funds are withdrawn through fictitious operations through Dubrava LLC controlled by Khabib,” Knysh said.
According to the lawyer, in order to retain power at the state enterprise Horse Breeding of Ukraine, Zinchenko, Orekhov O.V. (his deputy) in collusion with Batirsultanov and other interested persons have initiated actions blocking the activities of the new management of the enterprise, placed articles in the media and arranged protest actions and the like. The purpose of these actions is to focus public attention not on abuses on the part of Zinchenko and his team, but on the alleged usurpation of power in the state enterprise by Zhara K.K. (LLC Millennium), which previously provided services for sowing, processing and harvesting at the Horse Breeding of Ukraine.
“However, these facts are not confirmed by anything, which cannot be said about empty acts of acceptance and transfer of not yet grown, but not harvested crops between the Luhansk branch of Horse Breeding of Ukraine and LLC Dubrava,” the lawyer said.
Leading horse breeders of Ukraine have called on the Cabinet of Ministers to urgently intervene in the situation, bring the perpetrators to justice, create a commission comprised of specialists and develop an action program to bring the industry out of the crisis.