The Business Week for the week of March 22-29, 2020

The Business Week for the week of March 22-29, 2020


We keep working on the systematic updates regarding the Government’s response to the COVID-19 pandemic in order to provide you with the relevant information. Please see the details about Emergency Situation Implications. We will keep updating the information and notifying you about any changes. 

Ukraine extends quarantine until April 24 and declares an emergency situation

Ukraine’s Cabinet of Ministers announced that it has extended the quarantine period until April 24 and declared an emergency situation. Ukraine’s Prime Minister Denys Shmyhal said: “The Government is guided by a defined blueprint to combat the spread of coronavirus infection. And today’s decision is approved due to the fact that cases of COVID-19 have already been confirmed in 13 regions and Kyiv.” Earlier Shmyhal said on TV that the government’s COVID-19 stabilization fund will be around UAH 200 billion. Additional measures have been implemented to stop the spread of the virus. On March 24, Ukraine banned its citizens from flying abroad for tourism purposes. A day earlier, Kyiv’s city administration enforced for all operational public transportation to be used only by essential personnel such as those working for hospitals, law enforcement agencies, supermarkets and pharmacies.

Business is ready to offer aid during COVID-19 pandemic

The American Chamber of Commerce in Ukraine together with Deloitte conducted the second Ukraine COVID-19 Business Impact Survey, which shows that 64% of member companies are ready to support society in the fight against COVID-19, 32% – ready to provide financial support, 20% – provide protection means, 10% – medical devices, 6% – medicines. “During these most challenging times, companies are ready to help Ukrainians to fight the COVID-19 pandemic. The American Chamber of Commerce will continue to provide all necessary assistance to support Ukraine’s business and economy during these difficult times.” – states Andy Hunder, President of the American Chamber of Commerce in Ukraine.


In 2019 Ukraine’s GDP growth reached 3.2%

In 2019 Ukraine’s GDP growth reached 3.2%, slightly slowing down compared to 3.3% in 2018, reports State Statistic Service. The major source of economic growth was private consumption with 11.9% growth, compared to 9.3% in 2018. Net foreign trade demonstrated higher growth of merchandised exported goods – 6.7% outpacing imported products – 6.3%. On the production side the highest increase was recorded in the construction industry – 23%, information and communication – 7.5%, real estate – 7.5%, accommodation and food services – 7.1%, while a little progress had manufacturing – 1%, agriculture, forestry and fishing – 1.3%.


Ukraine’s central bank implements monetary policy to provide banks with more flexibility

The National Bank of Ukraine has introduced to Ukraine’s banks long-term refinancing hryvnia loans with maturity periods of up to 5 years, according to a statement by the Central Bank. The step is meant to provide more stability within Ukraine’s financial markets as well as stimulate economic growth, especially amid the COVID-19 pandemic. This will reinforce the central bank’s decision to continue to cut its key policy rate, loosen reserve ratios and assure that there is sufficient liquidity in the banking sphere. In addition, the NBU is providing more flexibility for banks by changing the schedule of liquidity regulation transactions. “Tenders to place certificates of deposit and issue short-term refinancing loans will now take place twice as often as before,” the central bank says. The NBU also delayed the scheduling of both capital reserve and systemic importance buffers for banks.

Ukraine sells almost $1 billion worth of government bonds

On March 24, the government sold $801.6 million worth of 3-month bonds with a 3% rate of return. It also sold  €75.7 million worth of bonds with an average rate of return at 2.22% and a 13-month maturity period. Altogether, the Ministry of Finance weekly auction brought UAH 24.8 billion to the state budget on March 24. Ukraine’s government had a few successful past weeks in selling bonds as it is adapting to turbulence in the capital markets caused by changes in investor sentiment and the COVID-19 virus. In addition, the National Bank of Ukraine says that the country is better prepared to head a potential economic crisis than it was during the 2008-2009 global crisis or in 2014. “The economy and financial system have no accumulated imbalances, meaning that the nation’s margin of safety is greater than in previous crises,” according to the Central Bank


Ukrainian innovative company will use 3D printing to produce valves needed to treat the cases of COVID-19

Ukrainian innovation company Revel Laboratory will start using 3D printing to produce valves that are used for breathing machines. “Hard times demand innovative solutions. That’s why Revel Laboratory rearranging its 3D printers to produce valves for breathing machines. This solution was invented by our Italian colleagues. We have already contacted CEO of Isinnova Cristian Fracassi and are expecting to get the technical specifications and 3D models of the valves”, – writes on his Facebook page the co-founder of Revel Laboratory David Stavnitser. Revel Laboratory encourages engineers, doctors, and laboratories to support the initiative and work jointly. Currently, Revel Laboratory is focusing on 3D printing of face shields for doctors.

A Lviv-based startup created a touch-free hand sanitizer dispenser

3D Tech, a Lviv based startup, has designed a touch-free hand sanitizer dispenser. Anyone who has the 3D printing facilities can make such a device as the company uploaded its blueprints online. “We made the files for 3D printing and the list of components open access: anyone in Ukraine can manufacture the same hand sanitizer dispenser and improve our model. The story is similar to how facemasks are made in the Czech Republic, and valves are printed in Italy,” says Pavlo Yesyp, CEO of the company. 


Ukraine has no plans to restrict agricultural exports

Ukraine’s Cabinet of Ministers is not planning to implement any limits on exports of its agricultural products, according to Taras Vysotskyi, the country’s deputy minister for the Ministry of Development of Economy, Trade and Agriculture, according to the Ministry’s press release. In addition, Vysotskyi discussed together with Ukraine’s agrarian associations critical agricultural sectors during the COVID-19 quarantine period. Agriculture companies involved in the food industry production are essential for food security and will continue to operate during the quarantine period, the Deputy Minister said. The ministry plans to meet with agrarian associations on a daily basis during the quarantine period. Ukraine’s agriculture sector is one of the top ones in the world feeding countries all over the globe. Ukraine became the leading grain exporter in 2019 as it exported 50 million tons of grain that year. 


Іn 2019 a net profit of JSC Zaporozhcran increased by 66%

Іn 2019 a net profit of JSC Zaporozhcran reached UAH 129 million, which is 66% more than in 2018. The company’s line of activities includes design, manufacturing, and installation of the cranes used in a variety of industries and transportation. More than 90% of its products are exported. Since 2005 the majority shareholder of JSC “Zaporozhcran” is the Finnish Konecranes. Konecranes is one of the largest world manufacturers of equipment for lifting and moving cargoes. Konecranes products are made for industries handling heavy loads like ports, intermodal terminals, shipyards, processing industries, nuclear power, and bulk material terminals. There is a successfully developing industrial park on the basis of the plant, which unites some of the Ukrainian and foreign companies.

Nibulon constructs a transshipment terminal on the Dnipro river in the Dnipropetrovsk region

One of the biggest Ukrainian agricultural companies and exporters of grains – Nibulon – is building its first transshipment terminal for grain, leguminous, and oilseeds shipments by water transport in the Dnipropetrovsk region. Zelenodolska branch is expected to be one of the best out of the company’s 18 facilities, with 300,000 tons of total shipment capacity per year, grain storage capacity – 75.2 thousand tons, daily drying capacity – 3.6 thousand tons, and daily capacity for shipment on water transport – 12 thousand tons. The total investment will comprise USD 22 million, according to the company’s press release. The opening of the terminal is planned for 2020.