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ONIC Weekly Report June 11 2019

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Office of the National Investment Council of Ukraine presents weekly reports as handy tools to keep track of the key news in business and investment climate in Ukraine and the world. The following report covers events dated June 3-June 11, 2019

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ONIC Weekly Report June 11 2019

  1. 1. WEEKLY REPORT June 3rd → June 9th, 2019
  2. 2. Ukrainian government will try to issue bonds with longer term and amortization payment schedule if it is possible to cut the refinancing risk, according to the medium term strategy for the state debt management for 2019-2022 passed by the Cabinet of Ministers on June 5 U.S. delegation headed by Donald Winter visited Ukraine to study the state of affairs in the Ukrainian defense sector with the aim of subsequently developing recommendations on the reform and development of the Ukrainian defense-industrial complex. Recommendations may form the basis of the updated Washington policy on bilateral military technical cooperation with Kyiv The Verkhovna Rada of Ukraine adopted the Law "On Amendments to Certain Legislative Acts of Ukraine on the Implementation of EU legislation in the area of technical regulations“, which is one of the conditions for the European Commission to resolve the issue of concluding an Agreement on Conformity Assessment and Acceptance of Industrial Goods with Ukraine (so-called visa-free regime) The European Union will finalize the consideration of the issue of providing the second tranche in the amount of EUR 500 million within the fourth EU macro-financial assistance program to Ukraine as soon as the relevant requirements are met by Ukrainian site U.S. payment service Payoneer has been launched in Ukraine in partnership with Alfabank. Freelancers will be able to receive funds from Payoneer account without additional fees, while standard Payoneer service fee is 2% of payment amount NJSC Naftogaz of Ukraine in pursuance of the government resolution adopted on June 5 should reduce the price of gas for the population by UAH 800, set it at UAH 6,299 per 1,000 cu m for June 2019 (excluding VAT) WEEKLY REPORT June 3rd → June 9th, 2019 Business climate in Ukraine GDP growth +3.3% Export $14,905 Import $16,918 Industrial output -0.9% CPI 8.9% Oil Coal Natural Gas Iron Ore Copper Corn Wheat USD/bbl USD/ton USD/MWh USD/ton USD/bushel 2018, y-o-y Jan - Jan 2019 Jan-Jan 2019 y-o-y Jan – Jan 2019 Jan-Jan 2019 y-o-y Jan - Feb 2019, y-o-y Feb 2019 Macroeconomic indicators Jan - Mar 2019, y-o-y Mar 2019 UAH/USD (NBU, average) 26.80 Source: Ukrstat, NBU 63.29 55.55 12.31 97.78 USD/ton USD/bushel 5777.75 4.16 5.03 million +7,8% +7,3% +2,1% 8,8% million
  3. 3. The European Bank for Reconstruction and Development (EBRD) organizes a syndicated loan of EUR 116 million for the wood processing company Kronospan UA. The funds will finance investments in new production facilities in compliance with relevant EU standards and regulations. The company plans to expand its production in Ukraine with the construction of a new facility in Novovolynsk DTEK Energy plans to build two wind farms in Mykolaiv region with a capacity of 565 MW. Under the wind farm projects it is planned to install up to 130 wind turbines with a capacity of 3.9-6 MW. The total construction area will be 35,000 ha Delta Wilmar plans to increase market share in the segments in which its Ukrainian subsidiary Chumak operates and to increase exports within the network of Wilmar Group in Asia, Africa and the EU. The share of exports is about 20% of total production and company plans to double it Norwegian renewable energy company Scatec Solar has begun construction of 148 MW solar power plant on Mykolaiv region. Project is being carried out in collaboration with Chinese energy giant PowerChina Guizhou, which provides financial and engineering services European Bank for Reconstruction and Development (EBRD) granted Yuria-Pharm Group a six-year loan of up to EUR 25 million and will help company to expand its existing production facilities and introduce an innovative solution for Ukrainian market, which help customize cancer treatment practices A joint venture of Dacsa Group and Bunge Limited started construction of a corn mill in Vinnytsya region. New mill will have the daily production capacity of 300 tons of corn grits and flours. The facility will occupy 0.3 ths ha. In addition to the construction of the mill, the management plans to reconstruct the already existing three grain storages. The total investment amounts to USD 14 million WEEKLY REPORT June 3rd → June 9th, 2019 Ukrainian Business News Alphabet Inc, Google’s parent company, would buy Looker, a privately held big-data analytics company, for USD 2.6 billion in cash. The deal reflects company’s plan to win customers with specialized software, as rivals focus on more general tools Swiss Re is planning a USD 4.5 billion IPO for UK life insurance unit to put it under a more favorable regulatory regime and give it easier access to capital. Under the flotation plans, Swiss Re would cut its stake in ReAssure to below 50% from 75% France is ready to cut its stake in Renault SA in order to consolidate Renault’s partnership with Nissan Motor. France, which has a 15% stake in Renault, might consider reducing its stake, if it led to a “more solid” alliance between the Japanese and French firms United Technologies is nearing a deal to merge its aerospace business with U.S. defense contractor Raytheon and form a new company worth well over USD 100 billion. Companies are seeking to pool resources through what would be the biggest merger in the aerospace and defense sectors PayPal Holdings has invested 10 million euros in Tink, a Swedish company that enables banks and financial technology startups to access financial data more easily. PayPal will use Tink’s technology to allow customers to connect their bank accounts to their PayPal accounts Japan’s Mitsubishi Heavy Industries was holding talks to buy Bombardier’s regional jet program, sending the Canadian company’s shares up 14%. Mitsubishi Heavy is working to break into aviation with the launch of its own regional jet program and Bombardier is trying to find a solution for its money-losing CRJ program, which has no orders past 2020 World Business News

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