Business news from Ukraine


The Cabinet of Ministers of Ukraine has reduced the deficit in the draft national budget for 2021 from 6% to 5.5% of GDP, Prime Minister Denys Shmyhal has said.
“An opportunity has been found to reduce the budget deficit to GDP from 6%, as proposed at first reading, to 5.5%,” he said at an extraordinary government meeting on Thursday.
Thus, the deficit was reduced by UAH 24 billion, to UAH 246.35 billion.
In the initial draft, state budget revenues were determined at the level of UAH 1.071 trillion, expenses – UAH 1.331 trillion. The new wording of the bill provides for UAH 1.092 trillion in revenues and UAH 1.328 trillion in expenses.
As reported, the state budget for 2020 provides for a deficit of 7.5% of GDP.

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The Cabinet of Ministers of Ukraine published a decree by which it amended the criteria for adaptive lockdown and extended its validity until the end of 2020.
The text of decree No. 956 dated October 13 on amendments to decree No. 641 dated July 22 was released on the government’s official website.
The decree restricts the opening hours of restaurants and other catering establishments from 22:00 to 07:00, and also tightens the restriction on holding mass events (no more than 50 people in the “green” zones, up to 30 people in the “yellow,” up to 20 people in the “orange”). The Cabinet of Ministers also banned spectators from visiting sports events, except for international ones, on which the Health Ministry will make another decisions.
In addition, it is recommended that all business entities organize shift work of employees, if it is technically possible to work in real time via the Internet while maintaining salaries.
It is recommended that institutions of general secondary education establish holidays from October 15 to October 30, 2020, and institutions of vocational and higher education from October 15 to November 15, 2020 switch to distance learning with the recommended departure of students from hostels, except for those who cannot do this.
According to the decree, the State Service for Food Safety and Consumer Protection should strengthen public control over compliance with sanitary legislation and anti-epidemic measures in the work of preschool education institutions, catering, physical education and sports, and trade.
Local authorities are advised to use additional units of public transport in order to avoid crowding in it and monitor compliance with anti-epidemic standards in the implementation of transportation.

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Ukrainian President Volodymyr Zelensky has instructed Prime Minister Denys Shmyhal to urgently assess the readiness of hospitals to help patients, to provide institutions with all the necessary equipment, given the rapid growth in the number of cases of COVID-19 coronavirus infection in the country.
The Office of the President reported on Saturday that the head of state instructed the government to provide medical workers with personal protective equipment in full amount and to strengthen control over compliance with quarantine rules.
Also, the Cabinet of Ministers must revise the operation of the entry points on the administrative border with the temporarily occupied territory of the Autonomous Republic of Crimea and the city of Sevastopol.
“Ukraine knows how to mobilize if necessary. It’s time for the government to mobilize to prevent a second wave of coronavirus infection, which can have dire consequences not only for the economy, but also for our human capital,” Volodymyr Zelensky said.

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President of Ukraine Volodymyr Zelensky submitted to the Verkhovna Rada a bill of Ukraine on government support for investment projects with significant investments – the so-called law on “investment nannies,” Deputy Head of the Presidential Office Yulia Kovaliv has said.
“I want to debunk the myths and memes about the ‘nannies’ that have flooded the media space and emphasize that this bill is primarily about providing a number of stimulating instruments of government support for investment projects,” she wrote on her Facebook page on Wednesday.
In particular, according to her, the bill provides for: securing investor guarantees by concluding a direct agreement with the Government of Ukraine for 15 years, appointing an investment manager authorized to accompany the investor in the process of preparing and implementing the project; providing tax benefits – exemption from income tax, exemption from payment of duties and VAT when importing new equipment into Ukraine; facilitating the provision of land necessary for the implementation of the project; building/reconstructing related infrastructure at the expense of the state (roads, electric and gas, heating networks, water networks, utilities, etc.).
“I want to note that the total amount of government support will be up to 30% of the amount of investment in the project,” Kovaliv said.
She said that this bill will support Ukrainian and foreign investors, whose investment amount should be at least EUR 30 million. They should create at least 150 new jobs with an average salary of workers at least 15% higher than the average salary in the relevant field in the region. Projects must be implemented in five years, and the duration of the special investment agreement with the government of Ukraine is 15 years.

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The Cabinet of Ministers of Ukraine at a meeting on Thursday approved the launch of electronic residency in Ukraine.
“This is one of the unique projects of the Ministry of Digital Transformation, which can make Ukraine a powerful East European IT hub. Thanks to e-residency, in the near future, our country will become attractive for foreigners to do business, primarily IT specialists,” Deputy Prime Minister, Minister of Digital Transformation Mykhailo Fedorov said, commenting on the decision on his Facebook page.
According to him, online, without the need to visit Ukraine, foreigners will receive a Ukrainian qualified electronic signature, registration number of a tax payer’s account card, the ability to open an online account with a Ukrainian bank, and simplified access to administrative services in Ukraine.
“We see foreign IT specialists working for Ukrainian companies, as well as specialists from countries of the Asia-Pacific region and neighboring countries, for whom the status of Ukraine’s e-resident will help to effectively cooperate in the European market, as the first e-residents. Of course, all e-residents will pass a thorough check in Ukraine by law enforcement, financial authorities and the Ministry of Digital Transformation,” he said.
According to Fedorov, in the near future, the Ministry of Digital Transformation and other government agencies will develop a regulatory framework for the launch of the project. It is planned to launch an e-residency portal by the end of the year.



The Ukrainian government will propose to the Verkhovna Rada that a EUR 100 million 30-year loan provided by Poland at 0.15% per annum is unlocked. The respective bill was approved at the government meeting on Wednesday. “The loan agreement between the governments of Ukraine and the Republic of Poland entered into force in April 2016. However, due to difficulties with the performance of contracts by Polish enterprises, where Ukravtodor, road services in Lviv and Volyn regions, the State Fiscal Service (the assignee is the State Customs Service) act as customers, in particular with the import and purchase of necessary goods on the territory of Ukraine, the loan takedown amounted to only EUR 5.8 million,” the Finance Ministry said on its website.
The proposed changes clarify the list of operations, goods exempted from taxation, and the settlement of customs payments in Ukraine as part of the implementation of the relevant agreement between the governments of the two countries.
“Under the agreement, Ukravtodor will receive EUR 68 million (for the development of road infrastructure on the approaches to six checkpoints on the Ukrainian-Polish state border), the State Customs Service will get EUR 25 million (for the construction of checkpoints Shehyni, Krakovets, Rava-Ruska), the administration of the State Border Guard Service will receive EUR 7 million (for the reconstruction of seven departments of the border guard service),” the Finance Ministry said.

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