Business news from Ukraine

USA TO PROVIDE UKRAINE WITH NEW FUNDING TO DIVERSIFY ENERGY RESOURCES

The United States will provide Ukraine with new funding to help diversify its energy resources, U.S. Secretary of State Antony Blinken has said.
“We are also discussing ways to ensure the security of energy supply to Ukraine. That includes providing new funding to help Ukraine diversify its energy resources, working with key allies and partners to bring to bear all available leverage and pressing for an extension of Ukraine’s gas transit agreement with Russia and supporting efforts of Ukraine to connect its electrical grid to Europe’s,” Blinken said at a press conference following a meeting of the United States-Ukraine Strategic Partnership Commission in Washington on Wednesday.

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EC INITIATIVE FOR COAL REGIONS IN UKRAINE TO HELP ATTRACT FUNDING

The initiative for coal regions in transition in the Western Balkans and Ukraine, led by the European Commission, will help them attract funding from a number of international financial institutions (IFIs), according to the announcement of the annual meeting of the initiative on June 23-25, made by the Delegation of the European Union in Ukraine. “The aim of the event is to support open, multi-stakeholder dialogue on coal phase out and just transition towards sustainable energy sources in Bosnia and Herzegovina, Kosovo, Montenegro, North Macedonia, Serbia, and Ukraine,” according to the announcement.
As noted in the EU Delegation, “the initiative will help coal regions access financing for transition projects or programmes, based on various sources available from the European Commission, the World Bank, the European Bank for Reconstruction and Development, and the European Investment Bank.”
In addition, the initiative contains four other pillars of support. This is a comprehensive stakeholder dialogue, an exchange program between coal mining regions, trainings by the Coal Region Learning Academy and technical assistance.
As stated on the website of the European Commission, the initiative for coal regions with economies in transition in the Western Balkans and Ukraine was launched in December 2020 and aims to help countries and regions move from coal to a carbon-neutral economy. It will support coal regions in the EU’s neighboring countries, namely Bosnia and Herzegovina, Kosovo, Montenegro, North Macedonia, Serbia and Ukraine.
The initiative is managed by the European Commission and collaborates with six international partners: the World Bank, the Energy Community Secretariat, the European Bank for Reconstruction and Development (EBRD), the European Investment Bank (EIB), the National Fund for Environmental Protection and Water Management of Poland (NFOSiGW), and the College of Europe in Natolin.

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UKRAINIAN TOURISM AGENCY INTENDS TO ASK FOR INCREASE IN FUNDING

The State Agency for Tourism Development of Ukraine intends to ask for an increase in funding to UAH 700 million, and will also initiate a change in the public procurement for marketing, Head of the agency Maryana Oleskiv has said.
“This year it is enough [UAH 100 million for the development of the tourist potential of Ukraine], since the agency starts using funds with a five-month delay. But in general, this money will not be enough for a large-scale advertising campaign, especially in TV. There is no need to do it, because the TV channels already pick up the content about Discover Ukraine, then abroad it is necessary. But there is not enough money for this, because, for example, a week of digital advertising on the BBC costs $100,000, and even more expensive on TV,” Oleskiv said in an exclusive interview with Interfax-Ukraine.
She said that next year more funds are needed to develop the tourism potential, since Ukraine is not competitive, if we compare, for example, how much Turkey or Georgia spend on such needs.
“For 2021, we plan to give a budget request for UAH 700 million. But here it is worth emphasizing that if we cannot make changes to public procurement and carry out marketing activities a little differently than provided by the ProZorro platform, it will be difficult for us even to use the existing funds,” Oleskiv said.
According to her, given the lengthy procedures for approval and coordination of various documents, which took the agency more than five months, the agency is only now starting to announce tenders for the promotional campaign.
“This model is ineffective for the marketing of the country. Everything must be stable. We cannot stop for six months and not engage in promotion. There must be planning for at least two or three years, the possibility of flexible use of the budget, depending on any changes,” she added.
The head of the State Agency for Tourism Development said that the existing system of public procurement does not allow doing this, which, in turn, greatly complicates the marketing of Ukraine in general.
“Therefore, we will initiate a conversation about amendments to the public procurement law to make a different procedure for marketing procurement. It may need to be some kind of supervisory board from different people from creative fields, or, for example, a tender for one agency per year, which would work with this product within the allocated budget according to a certain plan, changes to which would be made in agreement with this supervisory board. This should be a completely different approach than what exists now,” Oleskiv said.

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UKRAINE ASKS WB TO RAISE FUNDING FOR PURCHASE OF COVID-19 VACCINES

The Ministry of Health of Ukraine has asked the World Bank to increase the amount of funds previously considered for Ukraine in order to purchase vaccines, according to the agency’s website.
“Now the Ministry of Health has two priority areas in the fight against COVID-19 from the point of view of the healthcare system. The first one is to ensure maximum testing with PCR tests. Therefore, in addition to our large laboratories, it is important to consider the possibility of equipping laboratories for 200-250 PCR tests directly in hospitals. The second priority is the vaccine. We turned to the World Bank with a request to increase the amount of funds that were previously considered for allocating to Ukraine for the purchase of vaccines,” Minister of Health Maksym Stepanov said.
He expressed hope that these two areas will become the basis for new strategic projects between the Ministry of Health and the bank.
Arup Banerji, the World Bank Regional Country Director for Eastern Europe (Belarus, Moldova and Ukraine), in turn, promised “to cooperate with the ministry’s team to provide all the resources necessary to implement these directions.”

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BLACK SEA TRADE AND DEVELOPMENT BANK INCREASES BY EUR 34 MILLION RAISES FUNDING FOR PROJECTS IN UKRAINE

The volume of financing projects of the Black Sea Trade and Development Bank in Ukraine in the first half of 2020 increased by EUR 34.17 million, or 20.8%, to EUR 198.72 million, according to the bank’s report on the stock exchange.
According to the report, amount of unfulfilled obligations on projects in Ukraine during this period almost halved, to EUR 35.28 million.
As reported, in 2019, the amount of Ukrainian projects in the bank’s loan portfolio increased from EUR60.3 million to EUR 164.6 million, and their share from 4.4% to 8.9%, with the country’s share in the equity capital of 13.5%. In the first half of the year, the share of Ukrainian projects was 10.1%.
In general, the bank indicates that in January-June this year it managed to increase net interest income by 43.8%, to EUR 20.93 million, net operating income by 31.7%, to EUR 20.44 million, and net profit by 36.8%, to EUR 4.36 million.
The total assets of the bank for the specified period rose by 5.6%, to EUR 2.47 billion.
The bank recalled that in July 2010 it issued bonds worth EUR 150 million to increase its liquidity and assistance for post-pandemic recovery in the Black Sea region.
The bank aims to promote economic cooperation, trade and cooperation of the countries of the Black Sea region.

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GOVT PROPOSES TO ABOLISH SUPPORT FOR FARMERS, RAISE FUNDING FOR PENSION FUND BY UAH 20 BLN

The Cabinet of Ministers proposes to abolish support for agricultural producers, for which UAH 4 billion is provided in the 2020 national budget and increase funding for the Pension Fund of Ukraine by UAH 20 billion, to UAH 192 billion.
The materials of amendments to the law on the 2020 national budget of Ukraine, which the government submitted to the leadership of the Verkhovna Rada, were released by MP Oleksiy Honcharenko in the Telegram Channel on Thursday, March 26.
According to the amendments, the Cabinet of Ministers also intends to cut a number of subventions to local budgets, namely for the construction and repair of roads by UAH 3.24 billion, to UAH 18.9 billion; for local elections by more than UAH 2 billion, to UAH 1.3 million.
The amendments also provide for a reduction in the financing of the State Road Agency (Ukravtodor) by UAH 3.27 billion, to UAH 18.9 billion.
Regarding the country’s power bloc, it is proposed that the financing of the Interior Ministry be left at almost the same level at UAH 92.961 billion against the current UAH 92.966 billion. The costs for the Prosecutor General’s Office are proposed to be cut by UAH 50 million, to UAH 7.55 billion.
According to the materials with the proposed changes, funding for the Cabinet of Ministers Secretariat can be reduced by UAH 670 million, to UAH 930 million; the Supreme Court by UAH 110 million, to UAH 2.27 billion, the Verkhovna Rada apparatus by UAH 11 million, to UAH 1.989 billion.

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