Business news from Ukraine

UKRZALIZNYTSIA LAUNCHES TWO ADDITIONAL TRAINS FROM ODESA TO KYIV, LVIV

JSC Ukrzaliznytsia for the upcoming Independence Day of Ukraine will launch additional high-speed trains No. 224/223 Odesa-Kyiv and No. 168/167 Lviv-Odesa.
According to the company’s press service, the trains will be launched due to an increased demand for passenger transportation services on holidays.
Train No. 224/223 will transport passengers between Odesa and Kyiv on August 22 and 24.
Train No. 168/167 will transport passengers between Lviv and Odesa on August 22, 24, 26, 28 and 30.

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UKRAINIAN AUTHORITIES ALLOW PRIVATIZATION OF NAFTOGAZ, UKRZALIZNYTSIA, UKRPOSHTA

The Cabinet of Ministers on Wednesday intends to consider a bill on the list of 188 companies prohibited from privatization, according to the agenda of the government meeting. According to the text of the bill, the government allows the privatization of up to 50% of the shares of Naftogaz, Ukrzaliznytsia and Ukrposhta, but proposes to retain the state’s 100% share of corporate rights in National Nuclear Generating Company Energoatom, PrJSC Ukrhydroenergo, NEC Ukrenergo , Skhidny Ore Mining and Processing Plant (VostGOK), and Ukrainian Sea Ports Authority (USPA).
It is also proposed to include the SE Market Operator and the SE Guaranteed Buyer, created by the Cabinet of Ministers in 2019 in order to ensure the operation of the new electricity market, in the list of objects completely prohibited for privatization.
In addition, it is proposed to include in the specified list the state-owned enterprise Document, Ukraina Printing Plant for the production of securities, Kyiv offset factory, and Pivdenne (Yuzhne) Design Bureau.

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UKRZALIZNYTSIA TO COOPERATE WITH GERMAN LOGISTICS COMPANY HAMBURGER HAFEN UND LOGISTIK

JSC Ukrzaliznytsia (Kyiv) will cooperate with German logistics company Hamburger Hafen und Logistik AG (HHLA) on the development of intermodal railway transportation in Ukraine, and in future in the Baltics and Eastern Europe.
Infrastructure Minister of Ukraine Vladyslav Krykliy said on his Facebook page on Thursday that the companies have signed a memorandum of understanding on Thursday.
According to the minister, in the near future the German and Ukrainian carriers will have to agree on an action plan to determine and implement measures aimed at the improvement of services quality within the parties’ obligations, carry out regular monitoring, as well as eliminate problems.
The companies will also determine measures for improvement of the working capacity of the Odesa-Port rail station and the railway infrastructure with the aim of increasing cargo turnover in the port, take measures to improve effectiveness of commercialization of intermodal trains and agree on tariffs in line with international practices.
“In the long-term perspective they will have to decide on demand for rolling stock to provide intermodal transport services, reasonability of the use of light multisystem locomotives and determine the main requirements for location, financing and operation of terminals based on their growth,” Krykliy said.

UKRZALIZNYTSIA DISCUSSING WITH U.S. PARTNERS SUPPLY OF ADDITIONAL BATCH OF DIESEL LOCOMOTIVES

JSC Ukrzaliznytsia is discussing with its U.S. partners an agreement for the supply of an additional batch of diesel locomotives, Chairman of the board of the company Ivan Yuryk has said.
“I think that we will move along several parallel paths to modernize diesel traction. Both the modernization of the existing ones and the purchase of a small batch of new diesel locomotives are planned. We are now discussing with our U.S. partners an additional batch of up to 40 new diesel locomotives. I hope we will come to signing by the end of the year,” he said.
Yuryk also said that the company has also begun the process of purchasing new electric locomotives up to 200 units of various types of electric traction.
“Now we are holding an open tender. I hope that by the end of the year there will also be an answer who will become our partner in the construction and acquisition of these locomotives. The task of our company and the government is a large percentage of localization so that we launch the economy inside the country,” the chairman of Ukrzaliznytsia said.

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STATE-RUN UKRZALIZNYTSIA REPORTS DECLINE IN CARGO TRANSPORTATION

Ukrzaliznytsia in January-June 2020 cut cargo transportation to 143.2 million tonnes, which is 8.7% less than during the same time in 2019.
The company said on its Telegram channel for shippers on Monday that export reduced by 5.4% over this period to 38% of the total volume of cargo transportations, import – by 19.4% to 12%, transit – by 10.2% to 5%, and domestic transport services – by 8% to 45%.
In June 2020, cargo transportations reduced by 5.1% to 23.3 million tonnes. Export dropped by 15.8% to 32% of the total volume of cargo transportations, transit – by 11.7% to 4%. Meanwhile, import increased by 5% to 13% and domestic transportation services – by 1.1% to 51% of the total volume of cargo transportations.

STATE-RUN MONOPOLIST UKRZALIZNYTSIA CAN BE DEVIDED INTO FIVE COMPANIES

The restructuring plan of JSC Ukrzaliznytsia (Kyiv) provides for its division into a number of specialized companies, up to five, member of the company’s supervisory board Serhiy Leschenko has said in an interview with Interfax-Ukraine. “The Ukrzaliznytsia restructuring plan presents the company’s unbundling for discussion – there are different approaches involving the creation of three to five verticals. Cargo and passenger transportation, infrastructure, repairs and non-core assets. But this, of course, is an ideal plan,” he declared.
At the same time, according to Leschenko, Ukrzaliznytsia has not been able to separate at least passenger traffic into a separate company and stop subsidizing it from freight transportation for a year.
“Today I’m very upset that when the conditions were favorable for the company, the moment was missed. And we got into a certain centrifuge when we need to accept the anti-crisis program and reform the company at the same time,” he said.
He said Ukrzaliznytsia is still a huge national treasure that needs to be used correctly and which will lose its value simply under the influence of time, if it is not maintained and modernized.
“We need to optimize the company as much as possible – its purchases, staff, and expenses. Even if not everyone benefits from it, someone will get more orders, someone will close or will be fired. But in general, the company should be the winner. And in many ways it will depend on the new head of the company,” the official said.

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