Business news from Ukraine


2 March , 2016  

KYIV. March 2 (Interfax-Ukraine) – Ukraine’s Cabinet of Ministers on February 24, 2016, approved a state-funded targeted program for the development of 17 Ukrainian airports until 2023 with the financing of the program projected at UAH 8.7 billion.

The program is aimed at improving management of the airports’ property, it will be conducive to the development of transportation by air and have a positive economic effect on the development of all Ukrainian regions, the government said in a press release.

Under the program, aviation transport infrastructure should be brought in line with international standards and Ukraine is expected to strengthen its status as a transit state due to its unique geographic location. What is more, the program is designed to improve the efficiency of state-owned property management.

The program will be financed not only from local budgets, but will also use, among other things, loans to be raised against state guarantees, airports’ own assets and private investment.

About UAH 1.2 billion of the total required sum of UAH 8.7 billion, will be raised from private investors for the development of airport infrastructure not related to airfields.

The program foresees the construction, renovation, modernization of airfields, runways and airport facilities; airport infrastructure owned by Ukrainian airlines, the creation of an integrated state-owned chain of airports through mergers and transfer of state and municipally owned airports to the Infrastructure Ministry.

Under the program, such international airports as Boryspil (Kyiv) and Lviv will remain in state ownership. The following airports will be returned to state ownership: Dnipropetrovsk, Zhuliany (Kyiv), Kharkiv, Odesa, Donetsk (which is now a destroyed facility in occupied territory in Donbas), and Simferopol (located in the Russia-annexed Crimea). What is more, the airports’ facilities that were built or renovated as part of the Euro 2012 football championship preparations will be transferred to the Infrastructure Ministry.

“As a comprehensive approach to solving the problem of the development of aviation and state transport infrastructure during the construction, reconstruction and modernization of the airports, their infrastructure should be integrated into the system of municipal electric, road and railway transport to create transport hubs by combining all types of transportation,” the program said.

The program foresees that overall passenger flows should grow to 24.3 million people by 2023, which is twice more than in 2015, while airport capacity should double with simultaneously bringing airport services in line with international standards. The time of handling one aircraft is expected to shorten to 35-40 minutes.

Due to the implementation of this program, Ukraine plans to double its transit potential as a major international aviation transport hub. Public and private partnership will be more actively engaged to maintain and operate the airports and create a favorable investment climate to develop the aviation industry. The share of the airports’ activity not related to aviation should grow to 40% of their overall revenue.

What is more, the share of low-cost airlines is projected to grow to 30% of the air transport market.

At least 1,000 additional jobs are expected to be created under the state program.