Business news from Ukraine

EBRD WANTS TO CONTINUE WORK WITH SECURITIES COMMISSION TO DEVELOP CAPITAL MARKET

The European Bank for Reconstruction and Development (EBRD) is ready to continue work with the National Securities and Stock Market Commission on capital market development initiatives, the bank’s press service has said.
“We look forward to working with the securities commission on other capital market development initiatives,” Matteo Patrone, the EBRD Managing Director for Eastern Europe and the Caucasus, said.
“The European Bank for Reconstruction and Development has worked closely with the National Securities and Stock Market Commission of Ukraine on the preparation of this framework. The work was also coordinated with and supported by the International Swaps and Derivatives Association (ISDA). The EBRD welcomes the approval as an important new chapter in the development of Ukraine’s capital market,” the bank said on its website.
“The new law will contribute to the establishment of a derivatives market in Ukraine,” Patrone said.
“The new law puts Ukraine on the map for the derivatives market and for netting, allowing companies to safely and efficiently hedge their risk and exposure, thus contributing to the development of a local currency financial market,” the report says.
The EBRD is the largest international financial investor in Ukraine. To date, the bank has made a cumulative commitment of almost EUR15 billion through 466 projects in the country.

EBRD WILL ISSUE EUR 50 MLN FOR ROAD RECONSTRUCTION IN DNIPROPETROVSK REGION

The European Bank for Reconstruction and Development (EBRD) will finance the reconstruction of the Dnipro-Mariupol and Dnipro-Kotovka roads in Dnipropetrovsk region, EBRD Senior Adviser for External Affairs Anton Usov said on his Facebook page. “The head of Dnipropetrovsk region, Oleksandr Bondarenko, and the EBRD Deputy Director in Ukraine, Mark Magaletsky, have signed an agreement to begin preparing a project for the reconstruction of roads in the region. The project cost is estimated at EUR 50 million,” he said.Procurement of goods and services for this project will be carried out in strict accordance with the rules of the EBRD after approval by the board of directors of the bank and signing the corresponding agreement.Usov said that work in this direction was launched in October 2019 in the context of the Re-Think investment forum, which was held in Mariupol (Donetsk region).

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EBRD MAY ISSUE $81 MLN TO UKRAINIAN SUBSIDIARY OF AIR PRODUCTS’ AND ARCELORMITTAL

The European Bank for Reconstruction and Development (EBRD) could provide a long-term loan of $81 million for the construction of an air separation unit of Kryvy Rih Industrial Gas LLC (Kyiv), created last October by the Dutch company Krig Holdings B.V., a joint venture of American-based Air Products and Chemicals, Inc. and ArcelorMittal, in which Air Products is the majority shareholder.
“Subject to the finalization of commercial agreements, the company will design, construct and operate an on-site air separation unit to be located in Kryvy Rih,” the bank said on its website.
“The project will employ modern, state-of-the-art technology to safely and reliably produce industrial gases, for ArcelorMittal Kryvyi Rih steel works and other customers in Ukraine and beyond. By replacing existing industrial gas production on ArcelorMittal’s site, the new facility will reduce the annual energy consumption of the steel plant,” the report says.
“The air separation unit will be designed in line with the European Industrial Gas Association technological guidelines and will be among the first of its kind to be installed in Ukraine. The project is expected to result in carbon dioxide emission savings in excess of 60,000 tonnes per annum through energy efficiency gains of the steel works,” the bank said.
The total cost of the project is estimated at more than $100 million, the bank said.
It is expected that the EBRD Board of Directors will consider this project on July 22 this year.

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EBRD TO PROVIDE EUR 7 MLN LOAN TO UKRAINIAN GRAIN ALLIANCE

The European Bank for Reconstruction and Development (EBRD) plans to provide a senior secured loan of up to EUR 7 million to Baryshevska Grain Company LLC, the main operating company of the Grain Alliance Group, under the Resilience Framework. The Loan will be used to finance working capital needs of the Group amid the adverse impact of COVID-19 on its business.
According to a posting on the bank’s website, the project was approved in the context of the EBRD’s response to the COVID-19 pandemic.
“The loan will support the group’s liquidity and help it withstand the COVID-19-caused crisis. Therefore, it will help the company to preserve its capital expenditure plans, which were part of the original project between the Bank and Grain Alliance approved in 2019,” the EBRD said.
The original transition impact objectives are as follows: improvement in infrastructure for logistics, storage and transportation for export facilitation especially for small third-party farmers and installation of two biomass-fired grain dryers with total capacity of 24 MW utilizing sunflower residues, including husk, dust and broken kernels generated during the operational activity of the group.
The EBRD said that the status of the project is pending final review.

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EBRD STARTS FREE ONLINE ANTI-CRISIS MANAGEMENT COURSES FOR MEDIUM-SIZED ENTERPRISES

The European Bank for Reconstruction and Development (EBRD) launches a free online platform for training and consulting in 30 countries for micro, small and medium-sized enterprises (MSME) in managing financial resources, as well as working with clients and human resources during the coronavirus crisis, the EBRD press service said.
“The EBRD “Know How to…in a Crisis” program, hosted on the bank’s platform, the Know How Academy, is a central learning hub where entrepreneurs can access practical assistance, including training materials and crisis management advice from industry experts and can join peer discussion forums,” the bank said on its website.
“Launched by the EBRD as part of its enhanced support for firms during the current crisis, the program will focus on five key business pillars: crisis management – your customers and suppliers, financial management essentials, financing your firm, your staff – your key asset, and management and leadership challenges,” according to the report.
“The first module “Crisis management: Your customers and suppliers” will provide advice on how to keep your business supply chain moving and the cash coming in. It will be available from today, with the remaining four modules to be available shortly afterwards,” it says.

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EBRD AND UKRENERGO DEVELOPING 200 MW ENERGY STORAGE PROJECT

The European Bank for Reconstruction and Development (EBRD), together with Ukrenergo, is developing a project of building a 200 MW energy storage system to regulate frequency in the energy system, Olga Yeriomina, the EBRD senior banker for power and energy projects, said.
“The EBRD, together with Ukrenergo, is really working on a project to build an energy storage facility that would not need a feed-in tariff and that could solve the issue of regulatory capacities and reduce the price of electricity in the market. We are considering the possibility of financing a 200 MW construction,” she said at an online meeting at the Energy Club.
She clarified that the matter concerns a project, which is to be financed through an EBRD loan under state guarantees.
“With regard to regulation, Ukrenergo is obliged to provide system services, and these 200 MW will not participate in trading in the market, this will be a system service. An increase in the current tariff of the operator will not be required,” she added.
At the same time, she noted the growing need of the Ukrainian energy system for balancing capacities, which causes the need for the fastest government decisions in this direction.
“We see the situation with the shutdown of nuclear power plants. It’s hard for us now to figure out where the technical necessity is, where repairs are needed, and where administrative intervention is. But the faster the Ukrainian government structures would support our project idea, the faster the issue of flexible generating capacities would be resolved. There are a lot of distortions in the market, and we need to make up for time, take quick and decisive steps,” the banker said.

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