Business news from Ukraine


The state-owned enterprise Artyomsol in 2020 reduced salt production by 41%, to 1.18 million tonnes, which is associated with weather conditions, quarantine and increased competition in world markets, the company said in a press release on Tuesday.
According to it, Artyomsol produced 762,200 tonnes of ground salt used for sprinkling roads without packaging, which is half as much as in 2019, and this is associated with a warm winter in Ukraine and far abroad. According to the state-owned enterprise, the production of packaged salt increased by 3.6%, to 186,400 tonnes, whiles the production of iodized salt decreased by 6.6%, to 53,200 tonnes.
Salt packed in bags (10 kg, 20 kg and 50 kg) was produced in 2020 by 27.6% less only 147,600 tonnes, production of salt packed in flexible intermediate bulk containers reduced by one third, to 51,000 tonnes.
The output of salt briquettes over the year, according to a press release, decreased by 6.7% , to 11,200 tonnes, while salt blocks increased by 17%, to 3,400 tonnes.
The state-owned enterprise indicated that in 2020 the enterprise shipped its products to 15 countries of the world. The main importers of its products are Hungary, Poland, Slovakia, Romania and Belarus. More than 70% of the products were sent to the Ukrainian market.
According to the enterprise, at the end of 2020, there was a tendency to increase production volumes of the entire range.
“We have started a program of ‘rehabilitation’ of the enterprise, which includes a set of rapid measures to improve production efficiency and social support for workers. In 2021, we plan to increase investments in renovation and modernization of production to UAH 250 million, while in 2020 the volume of capital investments amounted to UAH 66 million,” Acting Director of Artyomsol Victoria Lutsenko said.
Artyomsol is one of the largest enterprises for the extraction and sale of sodium chloride (NaCl) in Central and Eastern Europe. The production facilities of Artyomsol are located in Soledar, Donetsk region.

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For its development, the Mining and Metallurgical Complex (MMC) of Ukraine requires an increase in annual investments to $2.3-2.4 billion by 2030 from $1.8 billion in 2019, CEO of GMK Center Stanislav Zinchenko said, presenting the study entitled “Metallurgy of Ukraine: Vision 2030” in Kyiv on Friday.
According to him, the country’s mining and metallurgical complex is currently a low-cost exporter of raw materials and semi-finished products, and by 2030 it should become a stable supplier of quality products, maintaining the position of the basic industry in the “new” economy.
He said that among the global trends is weak demand for steel in the coming decades – growth of less than 1% per year; excess steelmaking capacity and the development of protectionism, which leads to high competition in the markets; volatility in steel prices, it is also decarbonization, digitalization, possible changes in supply chains, an increase in the need for capital investments. In general, the situation is characterized by weak market conditions and low financial performance.
In the domestic mining and metallurgical complex, the strong side is vertical integration, the weak side is underinvestment, a high need for investments, large emissions of harmful substances into the environment, insufficient quality of finished products, dependence on exports, low consumption in the domestic market.
In turn, Chief Analyst at GMK Center Andriy Tarasenko identified five strategic areas for the mining and metallurgical complex: cost leadership, increased unit efficiency, environmental friendliness, strengthening the benefits of vertical integration, and diversification by product and market.
To implement these areas, it is necessary to reduce the cost of steel production, increase the share of output with high added value, boost steel consumption from 108 kg per person to 160 kg per person, which will ensure the growth of products with high added value by 38%. It is also required to improve environmental friendliness, reducing CO2 emissions by 20%, dust – by 50%. To increase the production of premium pellets with a high iron content and direct-reduced grade (DR) pellets by 10 million tonnes.
As part of the diversification of product markets it is necessary to expand the geography of sales and reduce dependence on countries with a high level of risk (trade, environmental, military).
Ukraine should pursue a policy of stimulating investment, developing the internal market, countering protectionism and implementing environmental programs, including by joining the European Green Deal.
According to the experts, in the case of such activities, the MMC of Ukraine by 2030 will increase steel production by 14.4% compared with 2019, to 23.8 million tonnes, and will increase foreign exchange earnings from exports by $600 million per year. At the same time, GDP will be additionally generated in the amount of $1.75 billion, tax revenues to the budget will increase by $400 million annually, and capital investments will increase by $1.3 billion.

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Mobalytics, a startup with Ukrainian roots, has announced the closure of the series A funding round in the amount of $11.25 million, investments will be used for the creation of a personal assistant for gamers.
Mobalytics told Interfax-Ukraine that the round was headed by the venture funds Almaz Capital and Cabra VC. Other investors who participated in the round include HP Tech Ventures, General Catalyst, GGV Capital, RRE Ventures, Axiomatic, and T1 Esports.
“Being among the first investors, Almaz Capital supported Mobalytics at every stage of the startup’s growth from the launch of the first game to the emergence of several game genres on the platform. The team did this masterly, creating all the conditions for scaling their product,” Danylo Stoliarov, a partner of Almaz Capital, said.
The startup plans to use the attracted investments to further develop the product, improving analytics and a personalized approach to each user. In addition, Mobalytics intends to increase the number of supported games on the platform and expand its technical and product teams over the next six months.
The Mobalytics team has been building and testing the GPI (Gamer Performance Index) for four years.
Mobalytics is an analytics platform and personal gaming assistant designed to help video game fans hone their skills. In 2016, the startup won the TechCrunch Disrupt Battlegrounds.
One of the largest parts of the startup team is located in Ukraine, the head office is located in Los Angeles (the United States), two of the three project founders are also Ukrainians.

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Foreign Minister of Ukraine Dmytro Kuleba has offered President of the American Chamber of Commerce in Ukraine (ACC) Andy Hunder and Executive Director of the European Business Association (EBA) Anna Derevyanko cooperation to develop trade and attract investment, the press service of the ministry said. “In the United States, Asian countries, and EU countries, the protection of internal business abroad, the development of trade, and the attraction of investments are some of the key functions of the foreign ministries. Now we are creating such an effective system of economic diplomacy in Ukraine. I would like to invite the leading Ukrainian business to unite forces,” Kuleba said during a video conference on Tuesday.
Kuleba also told about the relaunch of the Council of Exporters and Investors under the Ministry of Foreign Affairs. A meeting of the members, 80% of whom were reelected, is scheduled for May 21. Participants will be organized according to industry principles and will develop a joint work plan for the year.
The minister also shared with Hunder and Derevyanko his vision of cooperation between the diplomatic system and business, which will fill the agenda of relations with other countries with real cooperation projects, liberalize trade, expand the geography of exports, and attract investment in Ukraine.
Kuleba believes that successful Ukrainian business is also able to play a key role in establishing an effective system of economic diplomacy. It is, in particular, about professional expert assessment, attracting business to diplomatic education, and conducting special trainings and courses.
Derevyanko and Hunder, in turn, expressed gratitude for the initiative, which, in their opinion, is able to bring cooperation between business and diplomacy to a new level and contribute to the protection of Ukrainian economic interests. For their part, they confirmed their readiness to cooperate under the Council of Exporters and Investors, as well as in the development of an assessment system and diplomatic education.The parties paid special attention to the subject of encouraging foreign companies that transfer production from other regions of the world closer to sales markets, to locating production in Ukraine.

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The project of the Dunaya resort in Odesa region provides for attracting private investments of $2.5 billion, replenishing the hotel rooms with 20,000 rooms and creating 25,000 jobs, Fazil Askerov, the chairman of the board of the Odesa region tourism association, has said.
“This is the Dunaya resort town. The state company Dunaya. A year-round resort with a gambling zone. It will be located on the spit (part of the spit is a dam) between Sasyk Lake and the Black Sea. More than 500 hectares, the embankment is over 10 km. More than 80 hotels, the smallest with 150 rooms, and the largest with 1,000 rooms,” he said on Facebook.
The project provides for the opening of the first hotels in 2022, Askerov said. According to the plan, the resort will receive the first million tourists in 2025, and by 2030 their number will reach 6 million annually.
“After the quarantine is over, we will definitely hold a public presentation of the project for the general public,” he wrote.
He added that the project was created on the initiative of President of Ukraine Volodymyr Zelensky, the project’s architect was Serhiy Husev’s team, and one of the ideological authors was the chairman of the Verkhovna Rada’s Committee on Economic Development, Dmytro Natalukha. In addition, according to him, Mikheil Saakashvili presented the project at the parliamentary hearings in 2016.

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The amount of foreign direct investment (FDI) in Ukraine in the form of share capital as of December 31, 2019 amounted to $35.81 billion, which is $2.9 billion, or 8.8% more than at the beginning of the year, the State Statistics Service has said.
According to its data, investment inflow last year amounted to $2.53 billion, withdrawal some $1.28 million, and also the increase was provided by the exchange rate difference due to the strengthening of the hryvnia at $950 million.
As reported, in the first quarter of 2019, FDI in Ukraine increased by $45.5 million. Their revenues amounted to $590 million, withdrawal some $500 million, and the contribution of the exchange rate difference amounted to $60 million.
In the first half of the year, FDI growth amounted to $840 million: investment inflow to $1.26 billion, withdrawal to $730 million with a foreign exchange contribution of $520 million.
In January-October 2019 FDI grew by $1.82 billion: investment inflow was $1.67 billion, withdrawal – $980,000 and the exchange rate difference – $1.14 billion.
A significant increase in FDI in the fourth quarter is associated with the transaction on the purchase of telecommunications business in Ukraine by Azerbaijan’s Bakcell from the MTS. The purchase transaction for Vodafone Ukraine was closed at the end of December 2019 with funding from J.P. Morgan and RBI, the price was $734 million, including deferred payment of about $84 million.
As reported, in 2018, FDI growth in Ukraine amounted to $1.3 billion, a year earlier it was $0.38 billion.
According to the State Statistics Service, the largest increase in FDI in 2019 was recorded from the Netherlands: by $1.183 billion (up to $ 8.3 billion), as well as Cyprus – $824.4 million (to $10.37 billion), Russia – $185.5 million (to $0.78 billion), Switzerland – $162.4 million (to $1.71 billion) and Germany – $141.7 million (to $1.84 billion).
At the same time, there was a sharp decrease in investments from Hungary – by $184.4 million (to $0.38 billion) and the UK – by $70.6 million (to $2.04 billion).
By industry, the largest increase in FDI was recorded in financial and insurance activities – $916.5 million, information and telecommunications – $738.5 million, mining and processing industries – respectively $283.8 million and $271.7 million, real estate operations – $237.5 million, electricity and gas supplies – $216.8 million, in wholesale and retail trade – $182.3 million, as well as in professional, scientific and technical activities – $126.1 million.
At the same time, in the area of administrative and support services, FDI decreased by $264.2 million.
The State Statistics Service also said that it stops calculating FDI, and now the National Bank of Ukraine will deal with this exclusively.

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