The Office of the President of Ukraine hopes that the Ukrainian parliament will consider a bill on demonopolization of the spirit sector in Ukraine next week and that the preparations of state-owned enterprise Ukrspyrt will start, Deputy Head of the Office of the President Yulia Kovaliv has said.
“According to our estimates, the privatization of Ukrspyrt will bring us at least UAH 5 billion,” she said at a press briefing in Kyiv on Monday.
Kovaliv recalled that last week, the president introduced a bill on the demonopolization of alcohol production in the country to the Verkhovna Rada.
“Now alcohol is produced by the state-owned enterprise Ukrspyrt, while in another law we stipulate that all licenses for the production of alcohol can be granted only to state-owned enterprises. Actually, in conditions of non-liberalized production of alcohol in Ukraine, Ukrspyrt can only be sold at the price of scrap metal. We hope that next week this law on the demonopolization of the alcohol industry will be adopted and, together with this, preparations will be made for the privatization of Ukrspyrt,” Kovaliv said.
State-owned enterprise Ukrspyrt is a major producer of alcohol and alcohol-containing products in Ukraine. Until now, it was under the control of the Ministry of Agricultural Policy and Food.
The total production capacity of the SOE is more than 36 million decaliters per year.
Its work is provided by 41 production sites.
Ukrspyrt has resumed shipment of alcohol, terminated from July 1.
“The vodka crisis is canceled: the government has agreed on a temporary order for shipment of alcohol. State enterprise Ukrspyrt is working as normal and fulfilling contractual obligations,” the state-owned enterprise told Interfax-Ukraine.
The Cabinet of Ministers, in particular, agreed on a temporary order for shipment of alcohol until October 1, 2019.
“During this time, alcohol producers and consumers must bring accounting systems in accordance with the requirements of the Tax Code,” Ukrspyrt said.
As reported, the Cabinet of Ministers at a meeting on July 10 approved a “roadmap” of measures to resume the supply of alcohol suspended from July 1.
The document provides for the use of the metering devices already installed and registered in the relevant state register until the settlement of the issue of establishing and registering new electronic flow meters for ethyl alcohol by distilleries.
The state-owned enterprise (SOE) Ukrspyrt in 2019 will invest UAH 311 million in the electronic finished and shipped product accounting system and modernization of production facilities, the press service of Ukrspyrt has told Interfax-Ukraine.
The press service said that investment in the introduction of the e-accounting system would be around UAH 40 million.
In addition, the company plans to install feed additives lines at the sites where the company operates in Lviv and Sumy regions with an annual total production capacity of 32,800 tonnes.
Ukrspyrt also plans to expand production of raw spirit by 9,800 tonnes at the sites in Lopatyn and Sukhodoly, launch production of bioethanol with an annual capacity of 24,400 tonnes in Storonybaby (all based in Lviv region), modernize the production site in Tkhorivka (Kyiv region) for production of service fluids with a total capacity of 4,080 tonnes a year.
The press service said that Ukrspyrt plans to install energy saving equipment at two sites in Lviv region and one site in Sumy region.
In March, the company’s strategic plan for 2019-2023 with investment of UAH 1.53 billion was approved by the Agricultural Policy and Food Ministry of Ukraine.
“First of all, these funds will be sent to the production of new types of products (bioethanol, raw spirit, high-protein feed additives, biogas and carbon dioxide), as well as the installation of energy saving equipment. In addition to our own funds, we plan to attract short-term funding from Ukrainian banks,” the press service of Ukrspyrt reported.
The company is also considering investments from foreign partners. In particular, Ukrspyrt is holding talks with Chinese partners on investments in the production of bioethanol and additional products on the basis of three existing production sites.