The Black Sea Trade and Development Bank (BSTDB) predicts an economic decline in the Black Sea region of more than 5% of GDP in 2020 with a further recovery of 3-3.5% of GDP in the next two years, president of the bank Dmytro Pankin has said.
“What we know is that the Black Sea region (along with the rest of the world) is going to experience contraction in 2020, most likely in excess of 5%. However, due to the low base, we expect a rebound in 2021 and probably well into 2022, leading to growth averaging 3.0-3.5% in 2021-2022,” Pankin said in an exclusive interview with Interfax-Ukraine.
“Despite the contraction observed in 2020, there is still a robust demand for BSTDB financing, which our bank is happily providing, although the nature of the demand has changed. Many large-scale investments have been deferred, or even cancelled, and we are seeing more demand for direct corporate lending, and for support to SMEs through local financial institutions. We would expect this demand to increase as economies rebound in 2021 and 2022, in parallel to a rebound in larger investments and infrastructure operations,” the banker said.
“As we all know, relaxed monetary policies and expansionary fiscal policies have resulted in ample global liquidity, which benefits both developed and developing countries. As a development bank, we try to direct this cheap financing to real economic activities both in Ukraine and other countries,” he said.
“However, issues with political stability can inhibit or at best, postpone those investments. To fully take advantage of this ample liquidity Ukraine and all other countries need stability, working rule of law, good governance, and other related factors in place. This is particularly relevant for infrastructure investments,” he said.
The Black Sea Trade and Development Bank will finance four projects of Ukrainian companies: Ukrgasbank, Galnaftogaz, Metinvest and the construction of a school in Kyiv.
According to the Ministry of Economy, the bank approved the relevant projects on June 17 on the eve of the 22nd annual meeting of the board of governors, chaired by the Deputy Minister of Economic Development, Trade and Agriculture of Ukraine, Trade Representative of Ukraine Taras Kachka.
“Given the difficult period in the global economy caused by the crisis, the stable functioning of the Black Sea Trade and Development Bank and access to its finances are especially important. We welcome the fact that, despite the crisis, the bank continues to cooperate with projects with a high potential in public and private sectors, and support the economic development of member states,” Kachka said.
как Additional information on these projects is not yet available.Since the bank began operating in Ukraine, 47 projects have been implemented for a total of EUR738.9 million. In particular, projects are concentrated in such areas as the consumer sector, financial institutions, industry, consumer goods, utilities, telecommunications, energy, raw materials and materials.
The Black Sea Trade and Development Bank is an international organization uniting 11 states of the Organization of the Black Sea Economic Cooperation. The bank aims to promote economic cooperation, trade and cooperation of the countries of the Black Sea region.
The Black Sea Trade and Development Bank (BSTDB) is considering a possibility of participation in financing of construction of a wind farm in Kherson region with an installed capacity of 250 MW by SyvashEnergoProm LLC, a subsidiary of Norway’s NBT, the bank has reported on its website.
The sum of financing is not specified.
As reported, early September 2018, an agreement on the implementation of an international investment project to build a complex of wind farms in Kherson region with NBT to play the leading role in the project was signed. The wind farm would allow satisfying almost the half of the needs in electricity in Kherson region. According to the project, by the end of next year 67 wind turbines will be installed along the coast of the Syvash Lake. Total investment under the agreement is almost $450 million.
The European Bank for Reconstruction and Development (EBRD) will consider a loan worth up to EUR 150 million for SyvashEnergoProm LLC for the construction of the wind farm, of which up to EUR 75 million would be funded from the EBRD resources and the remainder would be syndicated in a B-loan structure to eligible institutions.
NBT acquired SyvashEnergoProm in Kherson, Ukraine in April 2018. The plan is to construct a wind farm with installed capacity in the range of 250–330 MW, the company said.
In 2006, Kherson Regional State Administration transferred the unfinished Syvash wind power plant to concession to SyvashEnergoProm until 2055.