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Old 2nd January 2018, 13:40
Gotno Gizmo Gotno Gizmo is offline
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A global stock market survey by Bloomberg found that the fastest growing exchange in the world in 2017 was the Ukrainian Equities Index, which rose by 80%. The Ukraine UX tracks trades on the Kyiv-based Ukrainian Exchange. Ukraine’s other main exchange, the PFTS, saw its index increase by 19% in 2017. By contrast, the WIG Ukraine Index fell by 8% last year. This index charts the seven Ukrainian companies listed on the Warsaw Stock Exchange. Last year, it rose by 41%.

A kidnapped crypto currency exchange executive was released in Kyiv after a $1 million ransom was paid in bitcoin, Anton Gerashchenko, an adviser to Interior Minister Arsen Avakov told Reuters and the Financial Times on Friday. Pavel Lerner, a Russian citizen, was kidnapped by six gun-toting men in dark clothing and balaclavas who grabbed him off a street in Kyiv on Tuesday and pushed him into a minibus with stolen number plates, Strana.ua, news website reports. The next day, a denial of service attack hit his company, EXMO Finance, which is based in Britain.

Chinese companies are negotiating with Kyiv officials to build “ring-road around Kyiv, a traffic intersection in the city center, and a 37 km long road connecting the capital with its [left bank] suburb of Brovary,” Xinhua reports. In a survey of China-Ukraine relations, China’s news agency cites: a Chinese agreement in November to build Kyiv’s fourth metro line; Chinese dredging of Yuzhny port “aimed at expanding maritime productivity while boosting Ukraine's grain exports by 15 percent,” and new contracts won by two Chinese companies to “modernize three key highways in western, northern and central Ukraine.” With bilateral trade to be up around 17% this year, Xinhua said China now is Ukraine’s third largest trading partner, after the EU and Russia. “This year, Ukrainian exporters delivered more than 220 new products to the Chinese market, with agricultural goods leading the list,” reported the article, headlined: “Sino-Ukrainian partnership gains new vigor in 2017.”

Odesa Region, the major point of entry for trade with China, has signed a cooperation agreement with China’s Jiangxi province. Spanning the banks of the Yangtze River, in southeast China, Jiangxi has a population of 45 million, slightly bigger than Ukraine’s. Unlike Ukraine, Jiangxi’s economic has been growing at double digits for most of the last decade. As a result, the provincial economy is now almost twice as large as Ukraine’s. From Odesa, cooperation is foreseen in food processing and developing ports and highways under China’s “Silk Road” program.

Ukraine's grain exports will decline for the first time in five years in the current marketing year, Maksym Martynyuk, the country's First Deputy Minister of Agrarian Policy and Food. During the marketing year, which runs between July 1, 2017 and June 30, 2018, Ukraine expects to sell 41 million tons, down 6% from last year, he told Interfax. Martynyuk places much of the blame on logistical bottlenecks, notably lack of rail wagons to carry grain to Black Sea ports. Ukraine supplies 8% of the world’s internationally traded grain.

With grain harvests growing far faster than storage capacity in Lviv region, eight grain elevators with a combined storage capacity of 68,000 tons are under construction. Last November, UkrAgroConsult reports, a ninth elevator, with a 7,500 storage capacity was built for Dzvony Agrofirm in the village of Bolotnya. Last fall, the region’s harvest of grains and oil seeds topped 1.4 million tons.

Poland will build 1,000 km of fencing along roads and highways near Ukraine and Belarus in an attempt to stop deadly invaders from the east: wild boar. Major carriers of African swine fever, wild boar are blamed for pockets of infection that have reached the Warsaw region. Domestic pig herds infected with the fever have been destroyed across Ukraine, Russia and Belarus. In addition to spending $37 million on fencing, Poland is giving hunters paid leave of up to six days to shoot wild boar. Harmless to humans but deadly to pigs, the current virus outbreak started in Georgia’s port of Poti a decade ago and has spread through Russia, the Baltics, Belarus and now Ukraine.

Foreign gas drillers are invited to bid through Feb. 8 on tenders for 42 new wells for Ukrgazvydobuvannia, the state gas production company. Placed through the ProZorro tender system, the winning bids value is expected to hit $225 million. As part of a drive to return Ukraine to self-sufficiency in gas by 2020, the state company earlier tendered 90 wells for drilling in Kharkiv and Poltava regions. During the 1970s, Ukraine was largest gas producing republic of the Soviet Union.

In 2017, the hryvnia lost 5% against the dollar, 11% against the ruble, and 21% against the euro, the National Bank of Ukraine reports. On Friday, the last day of interbank trading the exchange was 28.0672 hryvnia / dollar, compared to 26.6924 hryvnia / dollar on the first day of trading last January.

Ukraine's balance of payments surplus grew 2.6 times through November, to $2.6 billion, against a surplus of $987 million in the same period of 2016, according to the National Bank of Ukraine.

Bolstered this year by two Christmas holiday dates, the nation’s Christmas ornament business is thriving, with exports up 34% this year, Nataliya Mykolska, Ukraine’s chief trade negotiator writes on Facebook. “During the first 10 months of 2017, Ukraine exported $6.1 million worth of Christmas ornaments,” Mykolska wrote Sunday. “Germany, Netherlands, Poland, Russia, and Belarus are among the top five countries that import Christmas decorations from Ukraine.” Next Sunday, much of Ukraine celebrates orthodox Christmas, taking Monday Jan. 8 off as a bank holiday

Kyiv will soon have a new tourist attraction – an Apple museum 10,000 km east of the U.S. company’s California headquarters. Expected to open this summer, the museum is the brainchild of Oleksandr Kosovan, founder and CEO of MacPaw, a company that makes CleanMyMac software and Setapp, a Mac application subscription service. A Mac fan since his days at Kyiv Polytechnic Institute, Kosovan learned in 2016 that Tekserve, the legenday Mac repair store was closing. Friends brought the store’s historic collection from New York to Kyiv, one computer at a time. Then Kosovan bought a Mac collection from Poland. The museum is to open in Kyiv in July as part of festivities marking MacPaw’s 10th anniversary.

Flights from Odesa to Berlin, Frankfurt and Bergamo (Milan) are to start this summer. At present, Odesa has only one flight to Western Europe, to Vienna on Austrian Airlines. Interfax reports that last week the State Aviation Service approved flights by Ukraine International Airlines from Odesa to the two German cities. The airline is negotiating with the airport about the flight to Italy.

Reflecting Wizz Air’s commitment to expanding flights from Ukraine this year, the discount airline will hold a “Pilot Open House Day” next week in Kyiv. Wizz Air is looking for pilots, with preference to Air Force veterans, to fly the additional Airbus A320 that will be based in Zhuliany starting this spring.
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Old 6th January 2018, 15:17
Gotno Gizmo Gotno Gizmo is offline
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Ukraine Business Journal

Romania, Moldova and Ukraine are negotiating restoring a 400 km, Soviet-era high voltage transmission line that ran from South Ukraine Nuclear Power Plant in Mykolaiv region to Isaccea, a Romanian border town on the right bank of the Danube. This north-south line would be rebuilt for 400kv and would be integrated with ​​ENTSO-E, the European Network of Transmission System Operators. The Ukrainian portion would cost EUR226 million. The project is expected to be approved next October at a European Council of Ministers meeting. At present, most of Ukraine’s electricity exports come from Burshtyn, a coal-fired power plant in northern Ivano Frankivsk. The plant is disconnected from the main Ukrainian network and synchronized to the European grid. Burshtyn power enters the Hungarian grid through a substation in Ukraine’s border city of Mukachevo.

Through November, Ukraine’s electricity exports increased by 34.4%, the Ministry of Energy and Coal Industry tells Interfax. Burshtyn thermal power plant supplied 60% of the 4.7 billion kWh in exports. All exports went to Europe.

Ukrzaliznytsia, the state railroad, plans to build or buy 32 locomotives and 8,780 gondola cars for moving grain in 2018. This one year capital expense of almost half a billion dollars comes after loud complaints from farmers about rail bottlenecks between farmgates and the Black Sea ports.

Transit of Russian natural gas through Ukraine’s gas transportation system increased by 13% in 2017, hitting 93 billion cubic meters, the highest level since 2011, Naftogaz reports. Separately, coming from the West, five European countries now store gas in Ukraine, taking advantage of a new customs regime that allows duty free storage for 1,000 days. As a result of the break up of pre-2014 supply monopolies, 54 gas importing companies now work in Ukraine.

Ukraine’s trade with Russia is rebounding, seeing a 28.6% rise through November. Imports jumped by 38.6%, while Ukraine’s exports east rose 11.9%, the National Bank of Ukraine reports. The bilateral deficit with Russia, once Ukraine’s largest trading partner, is $3 billion. To the west, Ukraine’s exports to the EU jumped by almost one third, hitting $12.8 billion. Ukraine’s trade deficit with the EU is $3.7 billion.

Poland’s exports to Ukraine exceed pre-crisis levels of 2013. During the first three quarters of 2017, Polish exports to Ukraine grew by one third, to almost $4 billion, according to Dziennik Gazeta Prawna, citing Poland’s Main Statistical Office.

New car sales in Ukraine jumped by one quarter in 2017. Last year, 80,271 new passenger cars were sold, 24.5% more than in 2016. For the first time since the 2014, two brands were at or near the 1,000 sales mark for one month, according to AUTO-Consulting. In December, Ukrainians bought 1,121 Renaults and 967 Toyotas.

Ukraine’s new Road Fund starts this week with $1.7 million to be allocated this year for highway construction and repair, Prime Minister Groysman writes on Facebook. About one third of this money is to go to regions. Under a new system, Ukravtodor, the state highway agency, is responsible for 50,000 km of roads, and the regions are responsible for 120,000 km.

Kredmash increased production and sales of asphalt mixing machines by 53%, to 49. Decentralization of tax revenue and of road repair responsibilities was behind the big jump in 2017, Vladimir Ponomarenko, sales director Kremenchuk-based company told Interfax. He said: "2017 will really go down in history as a year of extraordinary recovery. For a long time we did not work so hard. Now, we have orders for two quarters ahead."

Ukraine’s government plans to extend $225 million, a record amount, in support to the nation’s ‘agro-industrial complex,’ Interfax reports. Although this year’s harvest is down slightly, exporters are drawing on stocks, pushing farm exports through November up by 19%, compared to the same period last year, hitting $16.4 billion.

“Ukraine’s Ban on Selling Farmland Is Choking the Economy” reads a new article in Bloomberg/Business Week. The article says: “While Ukraine boasts one of the world’s richest concentrations of fertile black soil, its crop yields are among the lowest in Europe…Wheat yields are less than half of those in Germany.” The reporters quote farm managers saying they would invest more if they owned the land. Instead, the system of leases, often for only 3-5 years, leads to checkerboard fields and low incentives to invest in modern fertilizers.

Anders Aslund writes a downbeat forecast for 2018: “Which Will Be Europe’s Poorest Country? Ukraine or Moldova?” Posted on the Ukraine Alert blog of the Washington-based Atlantic Council, the Swedish economist says foreigners soured on Ukraine in the second half of 2017, when “investors began to realize that the complex judicial reform that was underway would not cleanse the judicial system and thus reliable property rights would not materialize.” After Ukraine’s successful $3 billion Eurobond sale last September, politicians were emboldened to slow free market changes, antagonizing the IMF and EU. Aslund predicts: “At present, it looks doubtful whether either of these institutions will provide Ukraine with any funding in 2018, as their compassion has been replaced with distrust.” Finally, he writes: “Sadly, the ruling coalition does not seem to be interested in a real independent anti-corruption court or electoral reform even if legislation is under way..they should focus on securing real property rights so that Ukraine can boost its investment ratio to 25-30 percent of GDP and grow by 6-8 percent a year.”

As Ukraine’s economy becomes more export-oriented, five food items far outstripped the 2017 inflation rate, forecast at 13%. According to Oleksiy Doroshenko, director of the Ukrainian Association of Trade Networks Suppliers, the biggest price jumps were: lard +68%; beets +58%; carrots +57%; pork +37% and beef +30%. Increasingly Ukrainian consumers compete with foreign buyers. For example, during the first three quarters of 2017, Ukraine exported 185 tons of sausage – a 54% increase over the same period in 2016.

Former prime minister Arseniy Yatsenyuk has sold 30% of shares in Espreso.TV to Atmosphere Entertainment, Inc., a New York-based company controlled Ivan Zhevago, son of MP Kostiantyn Zhevago. The price was $1.5 million, Yatsenyuk's spokesperson Olha Lappo wrote on her Facebook page.

Ukraine started Monday to selectively collect biometric data, largely fingerprints, from foreigners crossing the nation’s international control points. Aimed at citizens of 71 countries, including Russia, border guards collected biometric data in the first 24 hours from 3,300 foreigners, about half of them Russians, the Border Guard Service reports.

In a big bet on Lviv, Dragon Capital is buying Victoria Gardens, the largest and most modern shopping center in Western Ukraine. Opened 14 months ago, Lviv’s 3-story Victoria Gardens has a gross leasable area of 54,000 square meters. At opening, it was valued at $110 million. The Antimonopoly Committee of Ukraine on Wednesday authorized Dragon, a Kyiv-based investment bank, to buy a majority stake in Victoria Gardens and in ECO Tower, the tallest building in Zaporizhia, Ukraine’s sixth largest city. Rising 19 stories with views of the Dnipro River, ECO is a shopping and business center that ranks as the city’s only Class A office space.

Ukraine’s booming e-commerce market for goods and services is will expand by 30% this year, hitting $2.3 billion, predicts Denys Horovy, development director of EVO Group, a UK-based business supply company with internet-based marketplaces in Ukraine, Belarus and Kazakhstan. In a pre-Christmas press conference, he told reporters that the number of orders on his group’s marketplaces increased by 61% in 2017, to 14.8 million. He said: “In 2017, Ukrainians purchased 68% more goods on marketplaces of the EVO group -- Prom.ua, Bigl.ua, Crafta.ua, Kabanchik.ua -- compared to last year.” With the average order totaling $35, Ukrainians mainly bought online: shoes, clothes, accessories, electronics, goods for home and garden, cosmetics and perfumes.

Chinese demand for Ukrainian amber has pushed prices up four fold in recent years, fueling an illegal gem rush that is turning patches of northwest Ukraine into moonscapes, AFP reports from Rivne. Geologists believe that Ukraine has 15,000 tons of amber, second only to Russia. Ranging from pale yellow to deep brown, this fossilized tree resin is used for jewelry. Legal production is about four tons a year. Illegal prospectors in northwest Ukraine mine between 120 to 300 tons, largely using high pressure water hoses to loosen amber buried up 10 meters below ground. AFP interviewed one miner, a former assistant manager in a Kyiv trading company. In Kyiv, he earned $220 a month. In the amber fields, he earned $300 in his first five days.

Lured by Ukraine’s high green energy tariffs, renewable energy facilities were commissioned last year at double the rate of 2016, reports the National Commission for Regulating Energy and Utilities. Last year, total installed renewable energy capacity increased by 23% - to almost 1,375 MW. Solar accounted for 82% of new capacity. Ukraine’s green tariffs are among the highest in Europe, a key part of the government’s 3-year drive to raise renewables from 1% of energy consumption today to 11% in 2020.

Ukraine’s gas imports rose 27% in 2017, to 14.1 billion cubic meters, according to Ukrtransgas, the state pipeline operator. Rising imports underline the government’s challenge to attain ‘gas independence’ within three years.
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Old 11th January 2018, 15:06
Gotno Gizmo Gotno Gizmo is offline
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China’s TBEA International could start construction this year of Eastern Europe’s largest wind farm in Mykolaiv, officials report from the region. Plans call for generating 500 mw of electricity from 100 windmills erected across three villages near the Tylihul River Estuary, about midway between Odesa and Mykolaiv. The project update came from Sergey Tanasov, Berezanka district head, who met Dec. 28 with Chinese officials of TBEA. A power equipment manufacturer with transmission projects around the world, TBEA is based in Xinjiang, China’s westernmost region and the platform for many Chinese projects in Ukraine and the Caucasus.

German companies created 2,000 new jobs in Ukraine last year, Foreign Minister Pavlo Klimkin said at a joint press conference in Kyiv last week with visiting German Foreign Minister Sigmar Gabriel. Klimkin estimated that Germany’s auto parts industry has created more than 30,000 jobs in Ukraine.

On news of Kyiv dropping a tax investigation, shares of Regal Petroleum spiked Friday, settling Monday to near double last week’s levels on the London AIM. Regal reported that tax authorities returned "the vast majority" of documents seized two months ago, and that the company is free to do business. The London-based company announced that it ended 2017 producing 2,800 barrels of oil equivalent per day in Ukraine, 65% higher than at the end of 2016. With the tax threat lifted, Regal is mobilizing 3D equipment at its VAS gas and condensate field, planning to ‘spud’ a new well next month.

Britain’s Ambassador to Ukraine Judith Gough warns that without an effective fight against corruption, new investments will not come here. In an interview with Novoye Vremya, she says: "Many famous British companies - Land Rover, JCB, Marks & ​​Spencer and many others - are present here. They constantly tell me that their development here is hampered by corruption, a huge amount of regulations and high tax rates.”

Used car sales nearly tripled last year to 59,026 cars, according to AUTO-Consulting. The top five favorites were: Renault, Volkswagen, Skoda, Opel and Nissan. In the mix of used cars, ‘fresh’ cars imported from Europe dominated, depressing prices of locally used cars. If light commercial vehicles are added to the mix, sales of used imported vehicles for the first time nearly equaled sales of new imported vehicles.

Electric car sales more than doubled last year, to 2,697 cars, Ukrautoprom, the industry association reports. Used cars accounted for 85% of sales. Of all imports, the Nissan Leaf was the most popular car, accounting for 82% of total sales. Electric sales are expected to grow again this year, aided by suspension of import duties, a step designed to cut prices by 20%.

Krukovka Carriages, the nation’s largest train car manufacturer, nearly doubled sales last year, hitting $3.6 billion, according to the company’s website. Located in Kremenchuk, Poltava, the company produced over 2,000 freight cars. Production is expected to further increase this year as Ukrzaliznytsia, the state railroad races to improve grain delivery service to the Black Sea ports.

Investment in titanium mining and processing in Zhytomyr is to more than double this year, to $7 million, this year, according to United Mining-Chemical Company, manager of mines in Irshansk. Located 150 km west of Kyiv, Irshansk is the core of Ukraine’s titanium industry and a major producer of ilmenite, a source of titanium dioxide, which is used in paints, plastics, paper, sunscreens, food and cosmetics.

Revenue earned from Ukraine’s exports of ferrous metals, largely steel, rose by 20%, to US$8.7 billion, according to the State Fiscal Service. This increase came despite a 12% drop in steel production last year.

Ukraine nearly doubled spending for coal imports in 2017, taking half from Russia, the State Fiscal Service reports. Ukraine imported 20 million tons of coal in 2017, a 27% increase over 2016. But the dollar cost ballooned 87% to $2.7 billion. Import demand surged after the government opted last spring to stop importing coal from secessionist controlled mines in the Donbas.

President Poroshenko blames the coal cut off for depressing 2017 GDP growth from 3% to 2%. In an essay for Novoye Vremya, he wrote: “Such rates are categorically unsatisfactory for the stable development of the economy and the restoration of the standard of living. That is why we are looking for non-standard, non-trivial and liberal solutions to improve the investment climate, accelerate economic growth, create new jobs.”

Poverty in Ukraine fell to 12% of the population last year, Viktoria Zakhozha, deputy director of Kyiv International Institute of Sociology, tells Dzerkalo Tyzhnia, or Mirror Weekly. Tracking poverty over the last two decades, she said that in 1998, 52% of poll respondents said they were almost starving. From that low point, poverty eased, hitting 11% in 2008. The global economic crisis pushed it up to 21%. Then, it dropped, hitting 9% in 2013. With Russia’s war on Ukraine, it spiked again, plateauing at 17% in 2014-2016.

Ukraine's foreign exchange reserves increased by 21% in 2017, to about $18.8 billion, the National Bank of Ukraine reports. Reserves can now cover 3.6 months of imports. In 2016, foreign exchange reserves increased by 17% to about $15.5 billion.

Ukraine’s central bank will hold its key interest rate at the next policy meeting, on Jan. 25, due to signs of slowing inflation, a Reuters monthly analyst poll showed on Thursday. Seven out of 10 analysts expect rates to stay unchanged, one expected a rate cut. Two forecast a hike to 15.0 or 15.5 percent from the current 14.5 percent. The analysts forecast inflation at 13.7 percent in December and at 8.8 percent by the end of 2018.

Funding for the Information Policy Ministry triples this year to $30 million. The Ministry produces TV and radio programs for the government, pays for such foreign broadcasting as UATV, and works for “the protection of the national information space.”

Ukraine is reorienting its vodka exports from Russia to Poland, Latvia and Germany, Pro Consulting says in a new report. Before Russia’s 2014 military attack on Ukraine, two thirds of Ukraine’s vodka exports went to Russia. Now most go west.

Russians account for two thirds of foreigners registered with the Ukraine’s new biometric controls at border posts. In the first week, about 15,000 Russians were registered out of a total of 22,500 foreigners entering Ukraine, Oleh Slobodyan, Ukraine State Border Guard service spokesman, tells 112 TV. Fingerprints and digital photos are taken of visitors from 70 countries.

Infrastructure Minister Volodymyr Omelyan predicts that Europe’s largest airline will start flights to Ukraine this year. "Ryanair will be in Ukraine this year,” he told Expreso TV. Hinting at an announcement within weeks, he said European discount airlines offer two-way benefits. "Ukrainians are ready to fly,” he said. “Moreover, foreigners are ready to fly to Ukraine -- if prices are low, and our country is open, which is essential for the development of business and tourist contacts."
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Old 11th January 2018, 15:22
Gotno Gizmo Gotno Gizmo is offline
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A Dutch court ordered a provisional freeze on Rinat Akhmetov’s Netherlands-based companies in connection with a long-running $820 million lawsuit, Reuters reports. The Dutch court freezes Metinvest, Ukraine’s largest steel company, and DTEK, Ukraine’s largest private power and coal producer. Last month, a Cypriot court ordered a worldwide freeze against Akhmetov, Ukraine’s richest man, and his Systems Capital Management as part of a dispute over SCM’s 2013 purchase of Ukrtelecom. SCM is appealing that freeze.

Inflation last year was 13.7% -- 10% higher than the 2016 level of 12.4%, the State Statistics Service reports. Some of he fastest growing areas were: house repairs -- 47.5%; fruits -- 34.5%; meat -- 29.4%; vegetables -- 24.7%; and milk -- 23,1%. Bucking the trend, the price of sugar dropped by 7.4%.

Egg exports increased 75% last year, to 89,000 tons, according to the State Fiscal Service. In dollar terms, sales were up 51%, to $69 million. The top three buyers were in the Middle East: United Arab Emirates -- $42 million; Iraq -- $12 million; and Qatar -- $5 million.

As labor migration to Poland cuts into all industries, Zaporizhstal, Ukraine’s fourth largest steelmaker, is investing $1.2 million this year in improving “the working life” of its 2,000 employees. This will range from renovating worker housing to installing modern showers, toilets, lockers, and ventilation in work areas. With Poland, Czech and Slovakia recruiting workers across Ukraine, employers complain that retaining employees is now a top challenge.

Azerbaijan accounted for 85% of oil imports to Ukraine last year, followed by Iran -- 8.5%; and Kazakhstan – 4%. Last March, Ukrtransnafta restored operation of the 400km oil pipeline from Odesa to Kremenchuk, the site of Ukraine’s only major refinery. Last year, $377 million worth of Azeri Light was refined at Kremenchuk. In dollar terms, Ukraine’s overall oil imports hit $442 million last year, 2.5 times over 2016.

Coal production dropped 15% last year, hitting 35 million tons, the Ministry of Energy and Coal Industry reports. Due to the embargo on coal from the secessionist areas, Ukraine more than doubled its spending on coal imports last year, with half of imports coming from Russia

Ukraine spends 4% of GDP each year to service its public debt, which amounts to 80% of GDP, Pavlo Kukhta, deputy head of the government’s Strategic Group of Advisers , writes on Facebook. He writes that a 40% debt-to-GDP ratio is safe for developing economies. EU accession requirements set a limit of 60% debt-to-GDP.

Kyiv Metro reversed passenger declines and provided almost half a billion rides last year, the subway system’s press service posted on Facebook. The 3-line system carried 498.4 million passengers, 2.8% more than in 2016. The most heavily used line was the oldest, the east-west Red line. 21.4 million people used Lisova station, the line’s east bank terminus. The Blue line came in second. Its most heavily used station was Minska, near the northern end, which carried 17 million. The Green line had the lightest ridership. Last November, two Chinese companies signed contracts to build a fourth arcing line that would connect all three lines, alleviating the flow of many riders to the three transfer stations in the city center.

Extending a popular holiday experiment, Kyiv city now provides password-free wifi to these popular tourist areas in the city center: Andriyivsky Descent, Kontraktova Square, Mykhailivska Street, Sofiivska Square, Poshtova Square and Shevchenko Park.

Half of the EU’s imported skis and snowboards came from Ukraine in 2016, Eurostat reports. Of 1.5 million imported skis and boards, 731,400 came from Ukraine. China followed with 28% of market share. Ukraine’s largest ski producer is Austria’s Fischer-Mukachevo, in Zakarpattia. It produces 180 models of cross-country skis and 130 models of mountain skis. In addition to Fischer, the factory produces for Scott Usa, Stöckli, Tecno Pro, Hagan, Rossignol, Alpina, Splitkein, and Tecno. About 1,500 people work at Fischer-Mukachevo, which is located 45 minutes by truck from Hungarian and Slovakian border crossings.

With the exception of the Baltics, Ukraine now has the highest degree of travel freedom of the 15 former Soviet republics, according to an annual global survey of travel freedom, the Henley & Partners Visa Restrictions Index. Countries are ranked according to the total number of countries they can visit visa-free. Ukraine’s visa-free deal with the EU allowed it to jump from 58th position to 44th position. Russia lags behind in 48th place.

Israel’s El Al airline is phasing out its four-year-old UP concept for low cost flights from Tel Aviv to Kyiv and other popular European capitals. Starting in October, El Al will restore business class to its Kyiv flights and divide economy into three fares – Lite, Classic and Flex.

Kyiv’s Zhuliany was Ukraine’s fastest growing major airport in 2017 with passenger traffic jumping 64.3%, to 1.8 million. In absolute numbers, Kyiv Boryspil was the national champion with traffic up 17.6% to 10.5 million passengers. As earlier reported, passenger traffic at Lviv was up 46.3% to 1.1 million. At Kharkiv, traffic was up 34.4% to 806,000. At Zhuliany, flights clearly flew packed. While passenger numbers were up 64.3%, the number of flights was up only 27.3%. With 95% of the traffic international, the top destinations were: Minsk, Dubai, Budapest, Ankara, Antalya, Sharm-el-Sheikh, Warsaw, and Rome.
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Old 12th January 2018, 14:53
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World Bank economists predict that Ukraine’s economy will gradually grow from their estimate of 2% in 2017. Looking ahead, the bank forecasts: 3% for 2018; 3.5% for 2019, and 4% for 2020.

Solar Chernobyl, the first solar plant near the abandoned nuclear plant, is to go on stream within weeks, the German-Ukrainian company tells AFP. With 3,800 photovoltaic panels installed across 1.6 hectares, the $1.2 million plant will generate 1 mw of power – enough for about 2,000 apartments. But 60 more solar plant proposals from foreign companies - American, Chinese, Danish and French – are being processed by Chernobyl’s State Administration zone. Investors come for Ukraine’s solar electricity tariff, which "exceeds on average by 50 per cent of that in Europe," Oleksandr Kharchenko, executive director of the Energy Industry Research Center, tells AFP.

Commissioning of ‘green energy’ projects this year will increase by 20% Ukraine’s total renewable energy installed capacity, Maxim Bilyavsky, energy advisor to the government, predicts to the National Industrial Portal. He said the main driver will be solar power plants.

U.S.-based Western Services Corporation has signed a $2.3 million contract with Energoatom to supply equipment for simulator training for nuclear power plant operators, the U.S. Commerce Department reports.

Finance Minister Oleksandr Danilyuk opened the Ukraine “Expo Zone” at the Consumer Electronics Show in Las Vegas. On display at the mega event are these Ukrainian start-ups: Senstone -- a pendant that allows you to translate voice notes into text; Kray Protection UAS -- drones for farming; Kwambio -- online platform for 3D printing; MMone Company -- armchair for 360 degree immersion in virtual reality; PassivDom -- autonomous smart house; Agrieye -- technological solution for farmers to increase harvests; LaMetric -- smart desktop clock; Discoperi -- helps drivers to avoid potential accidents; and Univrsee -- platform for publishing, distributing and verifying VR content.

Citing Ukraine’s lithium deposits and IT brainpower, Infrastructure Minister Volodymyr Omelyan challenged Ukraine to become a manufacturing center for vehicles of the future: electric cars. Talking on ZIK TV, he said: "We can either become a dump of the world, where we import 10- to 20-year-old cars, or become a center for one of the leading industries in the world." Chinese, South Korean, and European manufacturers are studying assembly in Ukraine, but no decisions have been made public.

Tuesday’s order by a Dutch court provisionally freezing Rinat Akhmetov’s Netherlands-based companies means that “only the assets are frozen. i.e. we cannot dispose of them. The businesses are operating normally,” a Systems Capital Management official writes to the UBJ. The assets include Metinvest, Ukraine’s largest steel company, and DTEK, Ukraine’s largest private power and coal producer.

Russia’s Rosneft has sold its gas stations in Ukraine to Geneva-based Glusco Energy S.A. Glusco is a subsidiary of Proton Energy Group SA, the largest supplier of Russian liquefied gas to Ukraine.

PGNiG, Poland’s state oil and gas company, doubled its gas sales to Ukraine last year, hitting 700 million cubic meters, the company reported. Last fall, Polish Oil and Gas Company, became the 9th largest supplier of gas to Ukraine.

Ukraine’s food exports to the EU last year grew more than as fast as food exports to the rest of the world, Olha Trofimtseva, deputy Agrarian Policy and Food Minister, said on the ministry website. Through November, Ukraine’s food sales to the EU jumped by 38%. Ukraine’s overall food exports expanded by 19%. Trofimtseva, who is responsible for European Integration, said Europe’s top five importers were: Netherlands -- 18.4%; Spain -- 14.4%; Poland -- 13.3%; Italy -- 11.8%; and Germany -- 10.3%. Of the $5.2 billion in total food exports to the EU, Ukraine’s top three items were: grains -- $1.4 billion; vegetable oils -- $1.3 billion; and oilseeds -- $900 million.

With the sugar refining season coming to a close, Ukraine has produced slightly more than 2 million tons of sugar, surpassing last year’s level. Of the nation’s 46 sugar mills, four are still refining, according to Ukrtsukor, the National Association of Sugar Producers. Due a shortage of state railroad wagons, producers risk losing up to $70,000 from missed export deadlines, warns Ruslana Butylo, head of Ukrtsukor’s analytic department. About one quarter of this year’s production is to exported. About 22 percent of overall production comes from Astarta, the nation’s largest producer.

President Poroshenko’s Roshen candy company lost legal protection in Russia to its Kremona name. Citing non-use, Russia’s Intellectual Property Court decided Tuesday to terminate legal protection 18 months early.

“Shuttle traders” temporarily blocked crossing points to Poland from Lviv and Volyn regions on Wednesday. Without violence, the man and women protested new rules that cut the duty free amounts of goods that can be carried into Ukraine by people who spend less than three days outside the country.

In February, state company Sumykhimprom will be put up for auction, with the final price expected to be about $9 million, Vitaly Trubarov, acting head of the State Property Fund, wrote on his Facebook page. Based in Sumy, this chemical company produces titanium dioxide, sulfuric acid, yellow and red iron oxide pigments, and complex mineral fertilizers.

Titanium ore and concentrate exports increased 26% last year, hitting 583,772 tons, the State Fiscal Service reports. Customs statistics point to the top three buyers: Czech -- 17%; the US -- 15.5%; and Turkey -- 15%. Titanium can be alloyed with iron and among other elements to produce strong, lightweight alloys for aerospace, military, and industrial processes.

Complaints over government tenders and purchases nearly doubled in 2017, Yuri Terentyev, head of the Antimonopoly Committee of Ukraine, writes on his Facebook page. Complaints hit 5,684 in 2017, up from 3,067 in 2016. The Committee is the appeal body for the procurement procedure.

Assets of 26 bankrupt banks were sold for $10 million during the first work week of January, reports the Individual Deposits Guarantee Fund.

Czech banker Petr Krumkhanzl was appointed Wednesday chairman of the board of PrivatBank, now state owned. From 2004 to 2011, Krumkhanzl worked for Austria’s Raiffeisen Bank, first in Prague, then in Kyiv, as operating director of Raiffeisen Bank Aval. For the last 18 months, he has worked as chief operating officer at Home Credit China.
Czech-Ukraine trade was up 28% through October, Ukraine’s embassy in Prague reports.

Ukraine’s politically sensitive “borsch index” went up last year at almost triple the 13.7% general rate of inflation. Among the key ingredients for the popular sour soup, meat went up by 36% and vegetables by 37%. The biggest jump was for beets, which give the soup its trademark red tint. Retail beet prices jumped 73%, Alexei Doroshenko, director of the Association of Trade Network Suppliers, writes on his Facebook page.

Infrastructure Minister Volodymyr Omelyan predicts Ryanair will be flying to Kyiv and Lviv this spring. He told ZIK television: "We are already at the final stage of negotiations with Ryanair, and I hope that its arrival will take place in January and February. There are technical moments that we are closing, but in general everything is fine." Ryanair’s low cost rival, Wizz Air, is advancing by two months two new foreign flights from Lviv. Flights to Dortmund now will start March 26 and flights to London Luton will start May 1.
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Old 13th January 2018, 17:57
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Elon Musk’s SpaceX has chartered an Antonov Airlines AN-124-100 cargo jet to carry a 28-ton carrier rocket nose cone across the US this week, from Los Angeles to Kennedy Space Center in Cape Canaveral, Florida. Known as the ‘Ruslan,’ this massive plane was the only strategic airlift jet capable of handling such oversized cargo.

By this summer, TIU Canada is to complete a $90 million, 90 mw network of five solar power plants in southern Ukraine. The first project, a 10.5 MW plant in Nikopol, Dnipropetrovsk, recently went on line. One more is to be built in Kherson and three more in Mykolaiv. Novoye Vremya reports that reported that engineering is done by Helios Strategia of France and Focal Line Solar of the United States. Panels and equipment are supplied by JA Solar Holdings of China and SMA Solar Technology of Germany. TIU is owned by Refraction Asset Management, a Canadian investment company.

The Beskidy railway tunnel, designed to speed freight from Ukraine to Hungary and Slovakia, will open May 25, according to Ukrinform. The new 1.8 km double track tunnel cuts under a Carpathian mountain spines separating Lviv and Zakarpattia regions. It is to end bottlenecks caused by the existing single track tunnel, built in 1886. The $120 million new tunnel is funded by the European Bank for Reconstruction and Development, European Investment Bank and Ukrzaliznytsia, the state railroad.

A 5-year, $11 billion program to rebuild and repair Ukraine’s highways was approved Thursday by the Cabinet of Ministers. The plan calls for rebuilding 1,000 km of highways and repairing 9,100 km. The project would create 55,000 jobs. Interfax reports: “The program aims to create a modern network of highways that will increase traffic and improve the investment climate and ensure the efficiency of transport services.”

Ukraine’s vehicle production increased by 63% last year, to 8,586 vehicles, according to the car industry trade association, Ukrautoprom. In the late Soviet era, Ukraine produced 200,000 cars a year. Several foreign car companies are studying manufacturing cars in Ukraine. Slowing decision making is uncertainty about the speed of Europe’s shift to electric and hybrid cars.

Saying “even our closest friends must play by the rules," US Commerce Secretary Wilbur Ross has slapped anti-dumping duties on Ukrainian steel wire rod. Subject to final approval by March 1, the duties range from 35% to 44%. Interfax reports that American pressure for tariff protection came after Ukraine’s exports to the US of carbon and alloy steel wire rod more than doubled in 2016, to 146,470 tons, or $55 million.

TrailStone, a US energy trader, is applying for a license to trade natural gas in Ukraine, according to the website of the National Commission for Regulation of Energy and Utilities. So far, the commission has licensed about 300 energy traders, many of them foreign. The commission will consider TrailStone’s application on Tuesday.

The EU-Ukraine free trade accord may be the best model for Britain’s post Brexit relationship with the EU, writes Tony Barber, Europe Editor of the Financial Times. He cites “an excellent paper on the EU-Ukraine accord” written by Erika Szyszczak of the University of Sussex’s UK Trade Policy Observatory. Attractive to Brexiters, the EU-Ukraine accord allows extensive access to the EU market, without offering a path to membership in the EU or the EU Customs Union. Ukraine’s accord calls for close defense and foreign affairs cooperation, without uncontrolled movement of people. Noting continental Europe’s move toward a closer union, Barber concludes: “To the extent that a more integrated Europe takes shape, the most comfortable place for the UK, Ukraine and Turkey may be outside the EU, but closely associated with it.”

Strengthening ties with China was one of Ukraine's top economic achievements of 2017, Ukraine’s Economic Development and Trade Ministry said Wednesday. Trade between China and Ukraine increased 18% to $7.7 billion. In reporting the announcement, China’s news agency, Xinhua highlighted the bilateral Belt and Road action plan signed by both countries. It called last month’s visit to Kyiv of Ma Kai, a Chinese Vice Premier, “a powerful signal of the strengthened economic partnership.”

Ukraine should start to regulate the crypto currency market, Oleksandr Turchynov, Secretary of the National Security and Defense Council of Ukraine argued Thursday at a meeting of the National Cyber ​​Security Coordination Center. According to Ukrinform, Turchynov said: “Taking into account the rapid development of the crypto currency market in the world, this issue cannot be left unaddressed by the state.” Ignoring this issue and the legal vacuum "poses a threat to the economy and security of the state." In response, the Center instructed authorities to develop a mechanism to ensure access by law enforcement agencies to data from crypto currency exchanges. A working group is to determine the state regulator for a crypto currency market, the procedure for monitoring transactions using crypto currencies, identification of subjects of crypto-currency transactions, and the means of taxing profits from transactions.

Peter Wagner, Head of European Commission’s Support Group for Ukraine, is to arrive in Kyiv next week to discuss reviving EU macro economic aid to Ukraine. On Wednesday, Hugues Mingarelli, head of the EU Delegation here, told Ukrainian Radio that the European Commission cannot now provide a planned EUR 600 million tranche of aid because Ukraine failed to comply with four out of 21 conditions. Now, he said, specialists are assessing “the possibility of providing such new macro-financial assistance.”

Halfway through the marketing year, Ukraine has exported 52% more oil seeds than last year, 3.5 million tons versus 2.3 million tons. The big growth is in rapeseed which has been exported at double the volume of last year, Finance.ua reports. The seeds are crushed to make canola cooking oil.

Now one of the world’s top five honey exporters, Ukraine’s exports climbed again last year, by 19%, to 68,000 tons. In dollars, exports increased by 38% to $134 million, four times the amount of 2012. This year EU’s duty free import quota rises by 46% to 7,900 tons. Exports above that level pay a 17.3% duty. The top buyers are: Germany, U.S, Poland, France and Belgium.
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Old 15th January 2018, 16:56
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Ukraine Business Journal

Clare Spottiswoode, a veteran British energy economist and manager, has been elected chair of Naftogaz’s new supervisory board. During the John Major years, from 1993 to 1998, Spottiswood directed the breakup of British Gas and Britain’s gas market liberalization. Joining Spottiswoode as international board directors are: Steve Haysom of Canada, Amos Hochstein of the US, and Bruno Lescoeur of France. Last summer, the first group of international directors quit, complaining of government resistance to free market changes. The new board, with new Ukrainian directors, has the backing of Prime Minister Groysman and the European Bank for Reconstruction and Development. The Bank gives Naftogaz loans to purchase gas on the condition of corporate restructuring. In addition to de-monopolizing Ukraine’s gas market, the new board faces the challenge of breaking Ukrtransgaz off from Naftogaz and then splitting it into two companies — one to manage gas transit and the other to manage gas storage.

Ukraine’s state gas production company plans to boost gas production at its fields in Lviv region. Under new pressure to raise production, the company, Ukrgazvydobuvannya, intends to drill exploration wells at six fields of its Lviv affiliate. Last year, Ukraine’s gas production rose by only 4%, a baby step compared to the giant strides needed to reach the government’s goal of self sufficiency by 2020.

Ukraine’s wheat production will fall about 4% to a four-year low this year, UkrAgroConsult forecast. With winter sowings vulnerable to winterkill from this week’s cold snap, the consultancy forecast a 2018 harvest of 25.1 million tons. Last Friday, the Wall Street Journal reported that, due to low prices and large stockpiles, American farmers are cutting wheat plantings. The current crop is expected to be the smallest since 1909.

In one bidding, the EU awarded all the duty-free Ukrainian wheat and corn imports available for 2018, Reuters reports. The EU awarded all 1 million tons of wheat and 1.1 million tons of corn. Reuters data analysis show that each bidder only will only receive between 1.8 and 2.7% of amounts requested.

In the first 10 days of January, Ukraine fully used up its duty free EU quotas for honey, grape juice and apple juice, Maksym Martyniuk, first deputy Agrarian Policy and Food Minister writes on his Facebook page. The honey quota had been hiked by 46% to 7,900 tons. Exports above that level pay a 17.3% duty. Juice quotas are 14,000 tons. Martyniuk also said that chicken farmers rushing to export used up 25% of the nation’s duty free quota by Jan. 10.

Antonov’s An-132D is Ukraine’s first aircraft without Russian parts, completed with avionics from Honeywell, engines from Pratt & Whitney Canada, air management from Liebherr of Switzerland, and propellers from GE Aviation Systems in Britain, UkrOboronProm, the state defense conglomerate, reports. The An-132D was developed in partnership between UkrOboronProm and Saudi Arabia’s Taqnia Aeronautics. Now UkrOboronProm is talking with Saudi Arabia, Turkey and the United Arab Emirates to similarly upgrade the An-70 with “new avionics and no Russian components.” A four engine medium range transport aircraft, the An-70 can ferry 47 tons for a range of 3,000 km. No sales have been made of either aircraft.

With Peter Wagner, head of the European Commission’s Support Group for Ukraine, visiting Kyiv this week, news reports say the EU is trying to devise a new, reduced aid package for Ukraine during the first quarter of this year. Concorde Capital’s James Hydzik writes: “It is in line with our expectations that the EU will offer a new Macro-Financial Assistance program this year, which might allow Ukraine to count on about EUR 0.6 bln in loan this yea

The CIA blames Russian military hackers for the cyberattack that crippled computers in Ukraine last June, an effort to disrupt the financial system, The Washington Post reports. Delivered through a mock ransomware virus dubbed NotPetya, the attack wiped data from the computers of banks, energy firms, senior government officials and an airport. Launched on Ukraine’s Constitution Day, the virus spread around the world, but more than half of the victims were in Ukraine. Post reporter Ellen Nakashima reports that the CIA concludes with “high confidence” that NotPetya was created and sent out by hackers working for the GRU’s Main Center for Special Technology, or GTsST.

Ukrainian tourism to Crimea and petty trade with the Donbas quietly continues, as evidenced by the 2017 numbers of crossings of the administrative borders with these Russia-controlled areas. Last year, there were 11.3 million crossings of the contact line with the Donbas and 2.5 million crossings of the line with Crimea. The peak time to visit Crimea was August, when almost 360,000 crossings of the administrative border were made, according to Ukraine’s Ministry for Temporary Occupied Territories and Internally Displaced Persons.

Tourists spent $750 million in Lviv last year, calculates the City Council. About 2.6 million tourists visited western Ukraine’s largest city, about 3.5 tourists per resident. By comparison, Prague gets about 5.4 tourists per resident. Lviv’s visitors spend an average of 4.4 days and spend $90 a day, Unian reports. The top 10 nationalities are: Ukrainians, Poles, Belorusians, Turks, Germs, Americans, Lithuanians, Britons, Czechs and Canadians. Of the total, 41% were Ukrainians and 58% were return visitors.

Ukrainian visa centers open today in 10 new foreign cities, including three in China, according to the Foreign Ministry. The cities are: Abuja, Beijing, Beirut, Cairo, Delhi, Guangzhou, Luanda, Rabat, Shanghai and Tunisia. In contrast to the current bare walls format, the new centers will offer new services -- making I.D. photographs, translating documents into Ukrainian, copying documents, preparing medical insurance policies, courier services, SMS-alerts, and “servicing in comfortable lounges."

Wizz Air’s traffic in and out of Ukraine jumped 64% last year, to 685,000 passengers, the Budapest-based discount airline reports. Last year, Wizz Air restarted service to Lviv and added a second Airbus to its Kyiv Zhuliany base. This year, it launches service from Kharkiv and will base a third Airbus in Kyiv. With more destinations and more frequencies, Wizz Air aims to increase this year its Ukraine traffic by another 60%, to 1.1 million passengers.

Passengers using Ukraine’s airports increased by 27.6% to 16.5 million people last year. International travelers accounted for 88% of the total traffic, or 14.5 million people. Foreign travel was up 29.2% over 2016, according to the State Aviation Service. Ukrainian airlines accounted for 64% of the traffic. The number of flights by Ukrainian airlines increased by only 16%, a situation that resulted in fuller flights and fewer ticket discounts.

Bulgaria Air, the flag carrier of Ukraine’s Black Sea neighbor, plans with start service to Ukraine Feb. 2 with flights twice a week between Sofia and Odesa. UIA and Windrose currently fly between Sofia and Kyiv Boryspil.
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