The National Bank of Ukraine (NBU) has revised approaches to calculating foreign direct investment (FDI), in particular, reevaluated the cost of FDI, which was previously calculated in foreign currency, to the hryvnia equivalent, the NBU press service said on Friday.
According to the report, the National Bank also began to consider reserves, additional capital, retained earnings and damage to the application to the charter capital of enterprises with FDI.
In addition, the regulator changed the approach to accounting for negative capital indicators in companies with FDI, in particular for such enterprises, the NBU began to use zero values in calculations.
As a result of the new calculations, FDI in Ukraine in 2019 increased by 5.1%, to $51.4 billion, and investment from Ukraine decreased 56.5%, to $3.5 billion.
“After the recalculation, FDI volumes generally increased. For example, in 2019, FDI volumes increased by about $2 billion only due to significant profits while the business environment was favorable. Last year’s appreciation of the exchange rate also contributed to an increase in the FDI volumes in U.S. dollar terms,” Director of the Statistics and Reporting Department Yuriy Polovnev said.
He said that the recalculation of FDI will not affect the balance of payments.
Capital investment in Ukraine in January-March this year fell by 35.5% after growing by 21.2% in the fourth quarter of last year, the State Statistics Service said on Tuesday. According to the State Statistics Service, in the first quarter of this year, UAH 76.914 billion of capital investment was disbursed (excluding the temporarily occupied Crimea, Sevastopol and the territories of Luhansk and Donetsk regions).
Among the regions, a significant decrease in capital investment in January-March 2020 compared to the same period in 2019 was recorded in Kherson (by 75.4%), Ivano-Frankivsk (by 49.5%) and Zakarpattia (by 49.2%) regions.
Among the industries, capital investment growth in the first quarter of this year was recorded in the provision of other types of services – by 51.4%, telecommunications – by 41.4% and IT and telecom – by 8.7%.
At the same time, in the field of art, sports, entertainment and recreation, the drop in investment amounted to 79.1%, aviation – 77.3%, catering – 74.2%, scientific achievements and developments – 73.2% and forestry – 72%.
The own funds of enterprises and organizations remained the main source of financing for capital investment, thanks to which 73.2% of the total volume of all investments was made.
A significant share of capital investments was made in machinery, equipment and vehicles – 41.7%, buildings and structures – 49.3% of all investments.
Capital investment in Ukraine in January-March this year fell by 35.5% after growing by 21.2% in the fourth quarter of last year, the State Statistics Service said on Tuesday.
According to the State Statistics Service, in the first quarter of this year, UAH 76.914 billion of capital investment was disbursed (excluding the temporarily occupied Crimea, Sevastopol and the territories of Luhansk and Donetsk regions).
The Bila Tserkva Industrial Park, a project of the UFuture Holding owned by businessman Vasyl Khmelnytsky, according to the approved development plan, intends to raise $250 million of investment and create more than 30 new enterprises by 2026, the company has said in a press release.
“According to our estimates, by 2026 [in the territory of two industrial parks Bila Tserkva 1 and Bila Tserkva 2] should be created more than 4,000 jobs, built 235,000 sq. m of industrial real estate, including production and logistics facilities on the territory of two industrial parks. The total investments volume should reach $250 million,” the company’s press service said, citing Director of the industrial park Volodymyr Khmurych.
The investments will be routed to construction of new commercial buildings, purchase of new production and logistics equipment, outfit of existing facilities, business processes automatization and certification, R&D, as wells as energy-saving projects and IT projects.
Among other things, Khmurych said that o manufacture of high value-added products and their components qualified specialists are needed.
“There are more than dozen educational institutions, including eight technical and vocational schools, and five higher education institutions and their branches in Bila Tserkva. We cooperate with all of them and believe that skilled labor market proximity is one of the competitive advantages of the industrial parks,” Head of Business Development of Industrial Park Management LLC (IPM) Andriy Ropitsky said.
The company said in the press release that the IPM has won bid for management company of Bila Tserkva 1 and Bila Tserkva 2 Industrial Parks. On May 06, 2020, the cooperation agreements were signed between the management company and industrial parks.
According to the terms of the contracts, the managing company ensures implementation of the development strategies and business plans of the industrial parks, attracts residents, carries out marketing programs, obtains permissions and approvals from state and local authorities related to industrial park and residents utilities and facilities design and construction.
“Many large manufacturing companies are facing supply chain shocks and production disruptions. In a search for a better balance between globalization and the necessary degree of independence, these companies will be choosing localization of production at the national or regional levels. We can offer best conditions for the localization of production in our industrial parks. The management company will help the industrial park in attracting foreign companies to the parks,” Khmurych said.
The total area of Bila Tserkva industrial park is more than 70 hectares. According to the company’s press service, at the beginning of 2020, six companies were residents of the industrial park. The first project was Plank Electrotechnic LLC electrical accessories factory.
Industrial Park Management LLC was founded in 2016, specializing in industrial real estate. During the years of operations 19.4 ha of land was sold and passed on for construction, while about 16,400 square meters of industrial and warehouse real estate is commissioned and under construction. Electric, gas, and water supply of the large infrastructure facilities in Kyiv and Kyiv region was completed.
Ukraine’s Foreign Minister Dmytro Kuleba and Minister of Foreign Affairs and International Cooperation of the United Arab Emirates Sheikh Abdullah bin Zayed Al Nahyan during a telephone conversation agreed to start work on common investment projects, the Foreign Ministry reports.
“We should focus on the implementation of investment projects with Ukraine in priority areas. We will work on a synergy of opportunities between Ukraine and the UAE to strengthen global food security,” the Foreign Ministry press service said citing Kuleba.
Kuleba, according to the agreements of the leaders of Ukraine and the UAE, reached during the telephone conversation on April 13, noted his readiness to intensify cooperation in investment, trade and economic spheres between Ukraine and the UAE.
Kuleba thanked the UAE for the humanitarian aid provided, as well as for helping bring back more than 3,000 Ukrainian citizens from the UAE and in transit from other regions of the world.
“We are deeply grateful to the UAE for humanitarian assistance, which is extremely important for Ukrainian doctors in the context of the fight against coronavirus. The UAE demonstrates partnership and true friendship,” the minister emphasized.
The foreign minister invited his colleague to visit Ukraine.
Astarta agricultural holding, the largest sugar producer in Ukraine, has launched the first phase of a five-year investment program to update agricultural machinery and introduce IT instruments for agricultural management of AgriChain company, which is part of the agricultural holding structure.
According to the statement on Astarta’s website, the investments in 2020 were aimed at purchasing 31 tractors (John Deere), 21 grain, row crops and beet seeders (John Deere, Horsch Maestro, Pöttinger Terrasem, Kinze, Monopil, Amity Technology).
In addition, as part of the investment program, two self-propelled sprayers (John Deere), four cultivators (Amity Technology), three seed harrows of Ukrainian production and ten sets of vacuum systems for the conversion of row seeders were purchased.
New John Deere tractors with a capacity of 345 hp equipped with accurate navigation and telemetry systems that will integrate with AgriChain Farm and AgriChain Scout modules.
“The data obtained in real time will provide an opportunity to receive information, form informed decisions and create accurate daily tasks to increase technological field operations,” Astarta reported.
The agricultural holding said that in a few weeks Astarta will begin the spring sowing campaign, preparations for which are ongoing. In particular, winter wheat fertilizing is being completed and soil is being prepared for sowing spring crops.
The company’s crop rotation in 2020 will not change, since traditionally the main spring crops are sugar beets (35,000 hectares), corn (65,000 hectares), soybean (28,000 hectares) and sunflower (41,000 hectares).
Astarta is a vertically integrated agro-industrial holding operating in eight regions of Ukraine. It consists of eight sugar factories, agricultural enterprises with a land bank of 243,000 hectares and dairy farms with 25,000 animals, seven elevators, a biogas complex and a soybean processing plant in Poltava region (Globino Processing Plant LLC).
After three years of profitable work in 2018, Astarta received a net loss of EUR 21.11 million. Its revenue decreased by 18.8%, to EUR 372.22 million, and EBITDA fell by 52.4%, to EUR 56.87 million in 2018.
The AgriChain Farm module is designed to operate and communicate across all production services. It combines all the stages and processes of the production chain: from planning to execution and reflection. The AgriChain Scout information system is currently at the final stages of testing. It combined monitoring of the state of crops, agrochemical field certificates, meteorological data, plant vegetation status (NDVI), systematic monitoring of crops and assessment of its condition, etc.
Other modules are under development and are simultaneously being tested as pilot projects at Astarta’s subsidiary agricultural companies.