The Business Week for the week of April 27 – May 3, 2020

The Business Week for the week of April 27 – May 3, 2020


On April 28th, the President of Ukraine signed the Law “On Amendments to Certain Legislative Acts of Ukraine on the Conditions of Circulation of Agricultural Land” № 552-IX, which was approved by the Verkhovna Rada on March 31, 2020. The archaic moratorium on selling agricultural land has been finally abolished, after two decades of being in force as a temporary measure. This step paves Ukraine’s path to the liberalization of the agricultural sector, establishes fair and transparent rules, and gives the impetus for economic growth. The launch of the farmland market is set on July 1, 2021. We explained what the law envisages and what changes it brings. 

Ukraine keeps securing global supply chain

Ukraine, being a major producer and exporter of grain, goes against corn export limits, stated deputy economy minister Taras Vysotskyi. Ukrainian agrarian unions stated there were no grounds to limit exports as the country should sell its stocks as soon as possible while the international prices are favorable. The country has exported 25.2 million tonnes of corn so far in the 2019/2020 season, 2.7 million more compared to the same period last year.


Ukraine improves its positions on the global tech arena as Dutch IT companies find huge advantages in Ukraine

Being a tech phenomenon with the largest IT labor force in Europe, Ukraine has world-class teams that make high-quality products. The Netherlands is hungry for tech talent and they come to Ukraine to satisfy their craving, KyivPost article reads. “Ukraine can show the Netherlands how to make an excellent technical product, as people here are trying to work harder and worry a lot about the success of their product,” says Dmytro Antonyuk (ISM Ukraine). Ukraine keeps improving its positions on the global tech arena year by year and becomes home for unicorns and R&D hub for foreign companies.

Innovative truck with a magnetless electric motor was introduced in Ukraine

Murmuration Technology from Kryvyi Rih introduced its first model of the compact commercial vehicle with an innovative magnetless electric motor. The main feature of the CoolOn truck is an electric motor of its own design and manufacture. The car is available with front or all-wheel drive, developing power from 30 to 80 kW. The presented version of the CoolOn electric truck is not final yet, its design will be further developed. The company is using the maximum quantity of Ukrainian components, until the complete localization of the production. In 2016, Murmuration Technology was founded to develop and implement reliable and inexpensive Valve Reactive Electric Motors. In 2018, they decided to build their own line of commercial electric cars and electric buses called CoolOn.


Ukraine received the highest score since its independence for budget transparency

Ukraine ranks 26th out of 117 countries for budget transparency, according to Open Budget Rankingspublished by International Budget Partnership. It’s the highest score for budget transparency since Ukraine’s independence. Out of 100 possible, Ukraine’s score in transparency is 63, public participation – 33, budget oversight – 87. A transparency score of 61 or above indicates a country is likely publishing enough material to support informed public debate on the budget, the report reads. 

Ministry of Finance attracted UAH 9.8 billion to the state budget from government bond sale

Ukraine’s Ministry of Finance held a government bond auction on April 28 and sold dollar-denominated bonds worth $164 million. The biggest chunk was made up of 9-month dollar bonds as $111.1 million were sold at 3.5%, while 6-month dollar bonds worth $53.3 million were sold at 3.29%. The three-month hryvnia bonds were sold for UAH 5.3 billion at 11.24%. Overall, UAH 9.8 billion was attracted to the state budget.

Ukrainian Government expands the state program “Affordable Loans 5-7-9%”

Now the limits of the maximum loan amount allowed for refinancing at 0% interest rate are removed. The enterprises with an annual income not exceeding EUR 10 million are eligible to obtain loans refinancing within the anti-quarantine support package at 0%. The state support for the enterprise is limited to EUR 200 thousand for any 3-year period.  Borrowers have the opportunity to refinance their existing loans at 3%, 5%, 7% or 9% per annum for the period up to 5 years and for the amount of up to UAH 3 million, reports the Ministry of Finance of Ukraine. 


JSC “Ukrainian Railways” increased its net profit in 2019 

The Consolidated Financial Statements for 2019 confirmed by Ernst&Young shows the net profit reached UAH 3 billion. EBITDA reached UAH 17.3 billion last year,  6% more than in 2018, reads the report. Ukrzaliznytsia increased revenues from the sales of its products by 8.4% to more than UAH 90 billion compared to the previous year. Cargo and passenger transportation has the largest share (91%) in the structure of revenues, which amounted to UAH 82.4 billion in 2019.  “JSC “Ukrainian Railways” entered a turbulent 2020 with a strong position and a clear record of accomplishment in managing operations efficiency, profitability and liquidity. The company has significantly improved its financial results, fulfilling all obligations to the state, society and creditors – on time and in full,” stated Ivan Yuryk, Acting CEO of Ukrzaliznytsia.


The Government has approved three winners of PSA tenders

The European Energy Holding EPH (Nafta) is the winner of the tender for the development of two oil and gas areas – Okhtyrska and Grunivska; the British company York Energy is the winner of the tender for the development of Ichnyanska block. The tender requirements envisage the minimum of $70 million of investments in the development of three areas during the first five years. “Today, the domestic gas industry is experiencing difficult times because of the record fall in oil and gas prices, along with the deepening global economic crisis amid COVID-19. At the same time, we are witnessing that international investors are ready to invest in the development of Ukrainian subsoil and the approval of the winners of PSA tenders by the government proves it. At the same time, it is also necessary to conclude negotiations as soon as possible and sign production sharing agreements with the winners of 9 PSA tenders. It will enable gas producers to start the development of oil and gas areas and will become a positive sign for the whole business community,” said Artem Petrenko, the Executive Director of the Association of Gas Producers of Ukraine.


Kyivstar increases 4G communication network coverage to the additional 496 Ukrainian settlements

One of the largest telecommunications operators – Kyivstar – connected 496 settlements to the 4G communication network in 11 regions, reports the company. Currently, the operator’s 4G network covers 11 thousand settlements, which is where 79% of the Ukrainian population lives. As reported before, Kyivstar increased its revenues by more than 19% in 2019.