Business news from Ukraine

UKRAINE TO COOPERATE WITH DANUBE REGION IN PORT INFRASTRUCTURE, CARGO SHIPMENT

KYIV. March 21 (Interfax-Ukraine) – Ukraine has joined the memorandum of understanding on the start of cooperation with the Working Community of the Danube Countries (WCDC).
The press service of the Infrastructure Ministry reported that Minister Volodymyr Omelyan gave the information at a meeting with Austrian Ambassador to Ukraine Hermine Poppeller. The Ukrainian minister handed the memo to Austria at the meeting with the ambassador.
According to the report, in 2016, Austria initiated Ukraine’s joining the memo of understanding on the start of cooperation with WCDC in the person of Lower Austria (including Danube ports) and western Black Sea regions and ports, which was signed in February 2014.
Memo participants are regional administration of the western Black Sea region, specifically Odesa region (Ukraine), Galati and Costanza (Romania), Varna and Burgas (Bulgaria) and WCDC in the person of Lower Austria who then chaired the community.
The memo is aimed at strengthening cooperation and coordination of general economic development of the regions in cargo shipments and development of cooperation of adjacent river and sea ports. The parties will draw up joint projects and find mutually acceptable ways to finance them.
Leaders of Odesa region, Odesa and Chornomorsk city mayors, top managers of Ukrainian Sea Port Authority, Odesa maritime merchandise port and Chornomorsk maritime merchandise port signed the memo.

CYCLONE-4M ROCKET COMPLEX TO BE BUILT IN CANADA ON COMMERCIAL BASIS – PIVDENNE DESIGN BUREAU

KYIV. March 21 (Interfax-Ukraine) – The creation of the Cyclone-4M space rocket complex in Canada by 2020 will be carried out within the commercial project of the space sector companies of Canada, the United States and Ukraine, the project will be funded by the Western investor, Pivdenne Design Bureau (Dnipro), the Ukrainian developer of space equipment, has said.
According to a report on the company’s website, a number of Canadian, American and Ukrainian companies will take part in the creation of the Cyclone-4M space rocket complex in Canada by 2020, recently announced by Canada’s Maritime Launch Services Ltd. (MLS).
Pivdenne design bureau will be responsible for the development, testing and operation of the carrier rocket and facilities and systems of the ground complex, Pivdenmash will be the supplier of Cyclone-4M launch complexes to MLS, the report says.
According to Pivdenne design bureau, the project will be financed by the Western partner: Maritime Launch Services Ltd. showed interest and on its own initiative plans to implement the project solely at the expense of its own funds and financial investments attracted from commercial sources, the report said.

ARCELORMITTAL KRYVYI RIH TO INCREASE INVESTMENT IN RENOVATION AND REPAIRS BY 75% IN 2017

KYIV. March 21 (Interfax-Ukraine) – PJSC ArcelorMittal Kryvyi Rih (Dnipropetrovsk region) intends in 2017 to increase capital investments and financing for repairs, maintaining the equipment and buildings efficiency by 75% compared to 2016, to almost UAH 11 billion ($400 million) from UAH 6.3 billion of capital and operating investments in 2016.
ArcelorMittal Kryvyi Rih CEO Paramjit Kahlon said at a press conference at Interfax-Ukraine that in 2017 actual capital investments would amount to about $250 million, the rest would be repairs, maintenance of equipment and buildings.
“ArcelorMittal Group has started investing in production and is fulfilling its obligations. Most of the projects – about 70% – are aimed at renewing technologies or improving the environment: these are sewage treatment plants, etc.,” the top manager explained.
The director general stressed ArcelorMittal invests significant funds in Ukraine, in the enterprise, noting that investments in ArcelorMittal Kryvyi Rih until 2020will amount to about $1.2-1.5 billion.
“The main tasks of this stage of the investment program of ArcelorMittal Kryvyi Rih are to increase production efficiency, replace obsolete equipment with new and environmentally safe, significantly improve the ecological situation both in Kryvy Rih and throughout the region,” the CEO said.

AIS TO INVEST EUR200,000 IN PEUGEOT CAR CENTER BASED ON EXISTING COMPLEX IN DNIPRO

KYIV. March 20 (Interfax-Ukraine) – AIS group of companies, a large player in the automotive market of Ukraine, will invest more than EUR200,000 in the reconstruction and restart of its trade and office complex in Dnipro to create a new Peugeot auto center on its basis for selling cars, spares and rendering services in one place (a 3S complex), AIS Marketing Director Serhiy Borovik has said.
“AIS starts cooperation with the Peugeot brand by signing a cooperation agreement with Peugeot Citroen Ukraine Ltd., which involves the construction of a new car center. For this purpose we will redesign our complex in Dnipro, in the construction of which AIS earlier invested over EUR4 million,” the expert told Interfax-Ukraine.
According to him, the work includes expanding the area of a showroom for the Peugeot brand, the complete redesign of the facade exterior and interior part according to the Peugeot brand book, the purchase of trade and service equipment, increasing the number of cars for test drives, expanding the staff, staff training on the programs of the manufacturer.
The start of work is planned for March of the current year.

EIB TO FINANCE LAUNCH OF TOMATO LINE IN UKRAINE

KYIV. March 20 (Interfax-Ukraine) – The European Investment Bank (EIB) on March 10, 2017 approved the financing of a production line for processing tomatoes in Ukraine.
The bank said on its website that the proposed investment underpins the promoter’s strategy to increase the competitiveness of its business through expansion of capacity and resource efficiency.
The total cost of the project and the recipient of the funds are not disclosed.
As reported, in May 2016 the International Finance Corporation (IFC) from the World Bank Group said it would provide $10 million to Agrofusion Group to boost its working capital. Agrofusion is the largest Ukrainian vertically integrated industrial tomato paste producer created by former co-founder of Sandora juice producers businessman Serhiy Sypko. The funds were invested late October 2016, the IFC said on its website.
Early November 2016 the European Bank for Reconstruction and Development (EBRD) said that the bank could provide a $15 million loan to Agrofusion. The EBRD Board was to discuss the provision of funds on December 14, but now the information about the project was removed from the bank’s website.
Agrofusion Group was founded by Sypko in 2007. Agrofusion Group in 2014 reached its maximum production of 52,778 tonnes of tomato paste, in 2015 it expanded its capabilities through investment, reaching a figure of 61,500 tonnes.
The company’s operational assets include two tomato paste plants with total processing capacity of approximately 500,000 tonnes of tomatoes per season; two seedling green-houses; and 20,000 hectares of irrigated leased land in Mykolaiv and Kherson regions as well as modern farming equipment.

GOVT APPROVES PROJECT TO BUILD UNIT FOUR OF DNISTROVSKA HYDROELECTRIC PUMPED STORAGE POWER PLANT

KYIV. March 20 (Interfax-Ukraine) – Ukraine’s Cabinet of Ministers has approved a project on construction of the second stage of Dnistrovska hydroelectric pumped storage power plant, consisting of unit four.
The decision was made at a government meeting on Thursday.
As reported, the hydroelectric generation development program until 2026 approved by government resolution No. 552-r dated July 13 envisages the start of construction of unit four in 2017 and its completion in 2020.
According to preliminary calculations it will cost UAH 2.796 billion. The capacity of the unit will be 324 MW in generating mode and 421 MW in pumping mode.