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Home , Chemerivtsi, Cherkasy, Kherson, Khmelnytskyi Oblast, Kropyvnytskyi, Rivne

Khmelnytskyi Investment Profile

2019 Table of Contents

About Khmelnytskyi Economics and Key Sectors Business Environment Why Khmelnytskyi? Infrastructure Trade and Services Doing Business Summary Economic Data Garment Industry Industrial Park Key Facts Railway Food Processing Local Taxes and Fees Geopolitical Profile Road Transport Construction Trading and Office of the Centers Municipal Public Industries and Logistics Transport Event and Exhibition BPO / SSC / IT sector Facilities Investments Success Stories Standard of Living Labour Market Other Relevant in Khmelnytskyi and Education Information Quality of Life Labour Market Interesting Facts Municipal Services Education about Khmelnytskyi Annual Key Events Transportation Universities in Khmelnytskyi Cost of Living Achievements Municipal Institutions

2 3 About Khmelnytskyi

Photo: Oleksandr Savenko Why Khmelnytskyi?

Strategic Qualified The most The largest Vivid geographical labour force affordable trading center cultural location housing in Western life market

6 7 Summary Key Facts Transit Routs

Area Khmelnytskyi is a marketplace for innovation and opportunity. The city is one of the best UTC +2 Gdansk places for doing business in Ukraine, which has Climate Temperate continental dynamic development, progressive views and Accessibility By train — from , , the safest city foresight of its residents. According to Focus , and . in Ukraine Rava-Ruska magazine Khmelnytskyi was recognized as one By — from more than 100 Pshemysl of the most comfortable in Ukraine – it got European cities. second place (after Kyiv) and was ranked first in

the Transparency and financial health of cities Population (2019) 273,700 Chop and regions in Ukraine survey conducted by the The average monthly gross ₴ 8,513 / € 288 International Center for Policy Studies in 2019. wages and salaries (2019) the largest trading center Vadul-Siret Average gross monthly The Parliamentary Assembly of the Council of € 400 in salary in industry Odesa (PACE) appreciates the efforts of the city of Khmelnytskyi toward European integra- National currency Hryvnya (UAH / ₴) tion, economic development, energy manage- Average exchange rate of the UAH 29.55 per EUR 1 ment and international cooperation, and in hryvnya to the euro recognition it recently awarded the city with the city is driven by small and Flag of Honour (2017) and the Plaque of Number of enterprises 28,648 Honour (2019). (2019) medium enterprises The largest sectors of Trade and Services As an active member of the Eastern Partnership the economy based Engineering Industry Ukrainian Routes European Routes Initiative of the European Union's “ for on the number of Production of chemicals and H02 H03 E40 E50 E85 Economic Growth,” the city is a main center of enterprises chemical products a junction of impor- Lviv Dunkirk Brest Klaipeda local economic growth in the region. The city Production of building materials Brussels Paris Kaunas tant transport routes Chernivtsi promotes long-running businesses and Wood products, paper Dresden Nuremberg comprehensively supports new business devel- production and printing activities Legnica Prague Lida opment. Trade and services, clothing produc- Textile production, clothing, Krakow Uzhgorod Slonim tion, food industry, construction, logistics, and Lviv Ternopil Kobrin leather goods and other materials the IT sector are in rapid development. Kyiv Khmelnytskyi Food processing industry Kropyvnytskyi Ternopil A reliable business ecosystem, skilled work- Capital investments ₴ 3,100 mln / € 105 mln efficient distances Dnipro Chernivtsi Donetsk Siret force, low-cost operating space, and excellent Accumulated foreign direct $ 27.4 mln it takes 20 minutes to get from one side of the city to the other Suceava connectivity with other cities provide investors investment in share capital Bucharest with a unique opportunity to tap into the city's of companies (2019) Kastanies potential. Alexandroupolis Rating of Investment invA+ attractiveness of Khmelnytskyi city the most affordable in 2020 assigned housing market at the level of among regional centers of Western and Information about khm.gov.ua Khmelnytskyi invest.khm.gov.ua 8 9 Travel Time Geopolitical Profile Border Crossings Distance Rail Car Rava-Ruska 302 km 4 h 34 min of the City Chop 466 km 10 h 57 min 7 h 21 min Vadul-Siret 216 km 10 h 56 min 3 h 43 min

International Airports 134 km 1 h 48 min 2 h 14 min Vinnytsia International Airport, VIN Lviv 255 km 3 h 28 min 4 h Khmelnytskyi Lviv Danylo Halytskyi International Airport, LWO Kyiv 357 km 4 h 16 min 5 h International Airport, KBP Igor Sikorsky Kyiv International Airport (Zhuliany), IEV 561 km 6 h 29 min 7 h 41 min Odessa International Airport, ODS

Cities in Europe 629 km 9 h 8 min Khmelnytskyi is situated in Western Ukraine within the Chernivtsi. Khmelnytskyi is part of the Baltic - Bratislava 938 km 11 h 35 min Podillia Upland on the Southern Buh River at the transport corridor "Go Highway" - Odessa - Gdansk in Kyiv, the capital confluence with the Ploska River. Khmelnytskyi is a building of which Ukraine is actively involved. and the largest city Budapest 771 km 10 h 18 min significant historical and modern economic and cultural In 2017 Khmelnytskyi became an associate member of in Ukraine, is only center of the Podilla region. The city is the administrative the Silk Road Cities’ Alliance. 671 km 9 h 11 min 4 hours away from center of Khmelnytskyi (region) and Khmel- The access to the central and southern regions of Khmelnytskyi. Vilnius 826 km 11 h 16 min nytskyi (district). The significant advantages of the Ukraine is convenient due to consistent improvement of city are its historical location at the crossroads of trade transport infrastructure, road and railway junctions. Kyiv Varna 899 km 17 h 46 min 16 h 16 min Warsaw, routes and geographical proximity to the eastern border is the capital and largest city of Ukraine and is four hours Istanbul, Helsinki, 1173 km 12 h 42 min of the European Union. by car from Khmelnytskyi. Warsaw, Istanbul, Helsinki, Prague, Berlin, The city is located at a junction of important transport Prague, Berlin, and Budapest can be reached in less than 1039 km 11 h 35 min Budapest and routes from Western Europe leading to Central Asia and a day by car. One of the largest Ukrainian clothing Bucharest 683 km 21 h 56 min 10 h 28 min from the Baltic states, towards the Black Sea and . markets is also in Khmelnytskyi. This market is well known Bucharest are These routes include: E50 (Brest-Makhachkala) and throughout Ukraine as well as in Poland, , within 24 hours via Przemyśl 343 km 7 h 11 min 5 h 13 min national value H03 (Zhytomyr-Chernivtsi). The city has and other neighbors countries for its large road transport. Kosice 563 km 15 h 32 min 8 h 44 min access to the international routes E40 (Dunkirk-Volgo- territory and low prices. Urban markets are gradually grad) through Lviv, Kiev and Kharkiv and E85 turning into convenient and modern shopping and (Klaipeda-Alexandroupolis) through Dubno, Ternopil, service complexes.

10 11 Economics and Infrastructure

Photo: Mykhailo Stopenchuk Economic Data

Key Economic Data 2019 >273,700 Population density 2.917 people/km 2 inhabitants Population 273,700 Volume of sales (products ₴ 14.87 billion / and services) € 503.2 mln >28,600 Retail turnover ₴ 7.07 billion / € 239.3 mln businesses registered Volume of construction ₴ 1.9 billion / € 64.3 mln in the city work completed GDP in Khmelnytskyi ₴ 75.7 mln / € 2.56 mln region (oblast) The population of the city of Khmelnytskyi GDP per capita in Khmelny- ₴ 59,600 / € 2,000 in comparison with other European cities, thousand people tskyi region (oblast) Strasbourg 275 Number of business entities Consumer price index 104.4 Khmelnytskyi 273.3 (for the oblast) Wiesbaden 272 474 107 22,761 5,306 Number of the registered 28,648 Chemnitz 247 small medium individual existing business entities Aachen 265 enterprises enterprises entrepreneurs legal entities Average gross ₴ 8,513 / € 288 Cosice 237 monthly salary 230 Average gross monthly € 400 Lille 228 salary in industry Erfurt 203 Rzeszow 158.4 ₴ 652.9 million / € 22.1 million ₴ 209.6 million / € 7.1 million 49.4% Potsdam 145.3 revenues to the budgets of all revenues to the budgets of all revenues to the budgets of all Salzburg 150 levels from small enterprises levels from medium enterprises levels from small and medium enterprises from the total tax revenues of the city budget Age structure of the population of Khmelnitskyi

<14 years 14–35 years 35–64 years >65 years 16% 31% 41% 12%

14 15 The share of the City in the economy Railway Transport of the region (2019), % Exports of goods / services, USD, mln Industrial products sales 34.3 2016 71,1 Volume of capital investments 32.6 Some changes were made to the 2017 101,7 48 timetable during the year, but they did Exports of goods / services 19 / 26 2018 127,7 railway routes not result in any significant changes Import of goods / services 52.5 / 22.5 2019 125.1 regarding the number of trains and Retail sales 56.5 lines served under a contract within the operator.

Exports (January-September 2019, mln USD) products of plant origin 20.3 Lviv – Khmelnytskyi – Novooleksiyivka textile materials and textile products 17.85 Lviv – Khmelnytskyi – polymeric materials, plastics 13.56 Lviv – Khmelnytskyi – Khmelnytskyi - Kyiv – Khmelnytskyi – Lviv various industrial goods 7.9 Khmelnytskyi – – Khmelnytskyi – Lviv Novooleksiyivka – Khmelnytskyi – Lviv , equipment and mechanisms, electrical equipment 7.5 Khmelnytskyi – Vinnytsia (2 routes) Vorokhta – Khmelnytskyi – Kyiv Odesa – Khmelnytskyi – non-precious metals 6.1 Dnipro – Khmelnytskyi – Truskavets Odesa – Khmelnytskyi – Lviv (2 routes) Zaporizhzhia – Khmelnytskyi – Lviv Odesa – Khmelnytskyi – wood, products made of wood 1.2 Kamianets-Podilskyi – Khmelnytskyi – Kyiv Odesa – Khmelnytskyi – Chernivtsi Odesa – Khmelnytskyi – Przemyśl chemical industry products 0.15 Kyiv – Khmelnytskyi – Truskavets Kyiv – Khmelnytskyi – Uzhhorod Przemyśl – Khmelnytskyi – Odesa , except 0.13 Kyiv – Khmelnytskyi – Chernivtsi Przemyśl – Khmelnytskyi – Kyiv Kyiv – Khmelnytskyi – Przemyśl Rakhiv – Khmelnytskyi – Odesa articles of stone, plaster, cement 0.0075 Kyiv – Khmelnytskyi – Rakhiv Rakhiv – Khmelnytskyi – Kyiv Kyiv – Khmelnytskyi – Kamianets-Podilskyi Truskavets – Khmelnytskyi – Kyiv Kyiv – Khmelnytskyi – Vorokhta Truskavets – Khmelnytskyi – Dnipro Lviv – Khmelnytskyi – Kharkiv Uzhhorod – Khmelnytskyi – Kyiv Uzhhorod – Khmelnytskyi – Odesa The foreign trade turnover in the city increased by 3.8% in 2019 compared to 2018 to USD 421.4 mln. Lviv – Khmelnytskyi – Lviv – Khmelnytskyi – Cherkasy Kharkiv – Khmelnytskyi – Lviv Lviv – Khmelnytskyi – Odesa (2 routes) Kherson – Khmelnytskyi – Lviv Lviv – Khmelnytskyi – Moscow Cherkasy – Khmelnytskyi – Lviv Lviv – Khmelnytskyi – Mariupol Chernivtsi – Khmelnytskyi – Kyiv Lviv – Khmelnytskyi – Kyiv Chernivtsi – Khmelnytskyi – Odesa

16 17 Road Transport Municipal 4th Local road conditions have been great- The City authorities continue to work among Ukrainian cities by criteria ly improved and the existing road on cycling infrastructure (construction «Passengers comfort in public transport 2019» infrastructure is continuously being of bike paths, bicycle lanes, pedestri- upgraded. Improvement of the urban an-bicycle zones, installation of bicycle transportation system (new parking parking facilities, bicycle parking racks). structures, new overpasses, transport An automated monitoring system oper- interchanges, reconstruction and repair ates in the city to analyze urban electric of city roads) as well as reconstruction and motor transport. and and opening of the airport are included are equipped with GPS trackers. in the strategic and operational goals of There are four "smart" public bus stops the Development Strategy of the City with integrated arrival time dashboards, of Khmelnytskyi until 2025. USB ports for recharging mobile devic- es, and free Wi-Fi. 114 5 25 304 45 trolleybuses autonomous routes buses and routes trolleybuses minibuses

Passengers can use mobile applications Khmelnitsky municipal enterprise and e-ticket cards. Other facilities "Electrotrans" carries out passenger include a journey planning option and transportation maps showing vehicles online through the service “EasyWay” and "Transport of Khmelnytskyi" showing the city traffic in real time.

www.eway.in.ua/ua/cities/khmelnytskyi city.dozor.tech/ua/khmelnyckyi/city

18 19 Standard of Living in Khmelnytskyi

Photo: Oleksandr Savenko Quality of Life Municipal Services Transportation

According to the safety rating of Rating Sociological Khmelnytskyi is recognized as a leader in municipal solid Group on behalf of the International Republican waste management in Ukraine. Landfill gas is now being Institute's Center for Analisys and Sociological Research extracted and used to create green renewable energy. 3rd 3rd 3rd in 2019, Khmelnytskyi was recognized as the safest city The Ecobus runs through the city's microdistricts to by the level of quality by the level of convenience in terms of comfort for among other Ukrainian cities. Khmelnytskyi also holds collect hazardous waste. The first underground garbage of the roads for pedestrians people with disabilities the leading position with the highest percentage of containers in the city were installed in 2018. Plans are respondents who responded positively (68 percent) in underway to open Ukraine’s first mechanical biologic terms of their own security. treatment plant. By 2022, it is planned to open the first The City is one of the most beautiful and greenest plant in Ukraine for mechanical and biological waste regional centers of Ukraine, lies along both sides of the processing. Southern Buh RiverThe and squares of the City The inhabitants of our city are satisfied and have a 4th 5th are filled with green chestnuts and linden trees, greater comfort of living than those living in many other by the level of convenience by the level of comfort for numerous flowerbeds and fountains. Ukrainian cities. for public transport passengers people with baby carriages Khmelnytskyi residents are satisfied with the place where they live, where they work, and how they spend their free time. Sports Facilities 1 12 239 hectares from 71.6 to 72.3 years Stadium Football fields a total area of parks, he average life expectancy squares, waterfront, is gradually increasing 1 24 Equestrian base Shooting ranges with during the last five years. 2 79 According to the results of the fifth municipal survey of 6th 6th 6th Athletics arenas Gyms by the level of convenience by the level of convenience by the level of convenience the International Republican Institute in Ukraine in 2019: for cyclists 38 113 for motorcycle / moped drivers for drivers of private cars 80% 5th place Sports surfaces Fitness facilities of respondents approve by the Quality 3 232 Satisfaction Index the activity of the city Rowing center Planar sports facilities authorities, which puts Khmelnytskyi on the 1st 3rd place 8 145 place among the regional by the level of diverse Swimming pools Other playgrounds centers of Ukraine leisure opportunities according to the experi- 17 ence of cooperation with 3rd place Tennis courts 6-й > among regional centers 20 % the city government city residents use cars in terms of opportunities of Ukraine by the level for business of quality of transport Khmelnytskyi has one of the lowest corruption rate infrastructure indices in Ukraine

22 23 Cost of Living Municipal Institutions

Taxi Municipal transport tickets Polyclinics and hospitals (52) Khmelnytskyi City Antituberculosis Dispensary ~₴ 20 / € 0.68 ₴ 15 / € 0.5 Single-journey monthly ticket Public Hospitals Polyclinic of the Security Service of Ukraine initial fee single-journey ticket Hospital with the Polyclinic of the Ministry of Interior of Ukraine Private Medical Centers ticket in paid ~₴ 7 / € 0.24 / km parking zone ₴ 3.50 / € 0.12 ₴ 130 / € 4.4 ₴ 70 / € 2.4 Khmelnytskyi Central District Hospital “Peremoha”, Medical Practice PSE in tariff within city limits trolleybus standard student Khmelnytskyi City Children's Hospital “Podillia”, Medical Practice PSE ~₴ 13 / € 0.44 / k m ₴ 5.00 / €0.17 ₴ 50 / € 1.7 ₴ 230 / € 7.8 Khmelnytskyi City Diagnostic and Treatment Center “Prestyzhmed”, Medical Practice PSE in tariff outside the city; bus, minibus children organisation Khmelnytskyi City Hospital “Pryzma on”, Medical Center payment in both directions Khmelnytskyi City Infectious Diseases Hospital “Maliatko Plius”, Private Children's Polyclinic Khmelnytskyi Regional Antituberculosis Dispensary Other Khmelnytskyi Regional Cancer Dispensary Khmelnytskyi Regional Center for Medical and Social Assessment Cinema Theatre Sport Khmelnytskyi Regional Cardiology Center Khmelnytskyi City Ambulance Station tickets tickets ~₴ 150 / € 5.1 / hour ~₴ 150-250 / € 5.1-8.7 / session Khmelnytskyi Regional Children's Hospital Khmelnytskyi Regional Center for Emergency and Disaster Medicine squash horse riding ₴ 60-80 / ₴ 60-100/ Khmelnytskyi Regional Hospital Khmelnytskyi Regional Center for Prevention and Control of AIDS € 2-2.7 € 2-3.4 ~₴ 80-95 / € 2.7-3.2 / hour ~₴ 150-230 / € 5.1-7.8 / hour Khmelnytskyi Regional Skin and Venereal Diseases Dispensary Khmelnytskyi Regional Narcological Dispensary standard standard swimming bowling Khmelnytskyi Regional Specialized Child Care Center "Berizka" Khmelnytskyi Regional Office of the Chief Medical Examiner ₴ 50 / ₴ 35-40 / ~₴ 250/ € 8.7 / hour ~₴ 50/ € 1.7 / hour Khmelnytskyi Regional Veterans Hospital Khmelnytskyi Regional Special Medical Supply Base tennis billiard sports € 1.7 € 1.2-1.36 Khmelnytskyi Сity Perinatal Center State Anatomico-Pathological Center of Ukraine reduced reduced ~₴ 50 / € 1.7 / hour ~₴ 30-70 / €1-2.4 / hour Military Hospital table tennis skating Police departments (5) Polyclinic of the Ministry of Internal Affairs Department Head Department of National Police in Khmelnytskyi Region The Bohdan Khmelnytskyi Health and Sanitary Department of the Zarichansky Police Office in Khmelnytskyi National Academy of the State Border Guard Service of Ukraine Public Polyclinics and Ambulatories Pivdenno-zahidny Police Office in Khmelnytskyi Food Hotel Accommodation Ambulatories of General Practice of Family Medicine (7) Khmelnytskyi City Police Office of Ukrainian National Police ~₴ 250-400 / € 8.7-13.5 accommodation prices Khmelnytskyi Children's Dental Polyclinic Khmelnytskyi District Police Office of Ukrainian National Police price of a two-course meal plus appetizer / € 34-101.5 /night / € 6.8 /night Khmelnytskyi City Associated Dental Polyclinic and dessert at an upper-class restaurant ~₴ 1000-3000 ~₴ 200 Fire & Rescue Stations (4) the highest category numbers for bed in hostel in the center of the city of Khmelnytskyi Khmelnytskyi City Polyclinics (4) ~₴ 575-900 / € 19.5-30.5 /night Khmelnytskyi Region ~₴ 150-250/ € 5.1-8.7 ~₴ 300-400 / €10.2-17 / night Khmelnytskyi Regional Dental Polyclinic middle category numbers motel (in Khmelnytskyi or on price of a two-course meal plus appetizer Khmelnytskyi City Centers for Primary Health Care (2) Independent State Fire Departments (2) the outskirts of the city) and dessert at a medium-class restaurant ~₴ 400-500 / € 13.5-18.6 /night Khmelnytskyi District Center for Primary Health Care A part of a special fire machinery emergency rescue squad of the econom category numbers ~₴ 400-500 / €13.5-17 / night Khmelnytskyi Regional Blood Transfusion Station special purpose of the Main Department of the State Emergency room in a private appartment Khmelnytskyi Regional Psychoneurological Dispensary

24 25 Labour Market and Education

Photo: Olha Salipa Labour Market

Sectors including trade and services, transport, logistics and In 2019, most vacancies in Khmelnytskyi were offered for storage, engineering industry, garment industry, IT possess the Dynamics of Average Monthly Salary highest employment potential in Khmelnytskyi. of Full-Time Employees, UAH The highest employment growth is currently expected in food services, construction, transport, industry and logistics segments. Approximately 14 percent of the city’s population is actively 200 personal service industrial workers specialists engineers others searching for a job. 200 200 200 workers and shop and craftsmen In 2019, the average monthly salary in the city amounted to ₴ 8 200 200 200 200 200 200 assistants 513 (2018 - ₴ 8 098), which is 163 UAH less than that in the 200 200 200 200 200 200 20,4 % 18,3 % 15,9 % 14,7 % 30,7 % region (9 515 UAH) and 1 990 UAH less than the average salary in 200 200 200 Ukraine (10 503 UAH). An additional advantage is the possibility to use the assistance of the labour market institutions, as they match employers with job ₴3 479 ₴4 043 ₴5 854 seekers. The website of Khmelnytskyi Regional Employment 2015 2016 2017 Center (khm.dcz.gov.ua/) and a special service for job and personnel search, HeadHunter.UA, (khmelnitsky.hh.ua), work.ua Majority of the new jobs in the period mentioned above were offered in the following spheres (www.work.ua/jobs-khmelnytskyi/) сontains useful information about vacancies, employees and featured jobs. Regional centers of the state employment service regularly publish reports on the current situation of the labour market in Khmelnytskyi and in the 200 region. 200 trade IT services restaurants hairdressing and garment other 200 200 What may encourage the opening of a business in Khmelnytskyi 200 200 and food beauty salons industry 200 200 are relatively low labour and employment costs. 200 200 delivery 200 200 200 200 200 200 200 200 41 % 6 % 6 % 6 % 5 % 36 % 200 200 200 200 200 200 200 200

200 ~14 % The most wanted specialists searched by employers are of the city population is ₴8 098 ₴8 513 actively searching for a job 2018 2019

shop assistant specialist of sales specialists technology technology specialist departments specialist

cook seamstress locksmith welder driver

28 29 Education

Khmelnytskyi’s human capital is another advantage. The City’s institutions provide study programs on hotel and restaurant business management, marketing, entrepreneurship, trade and stock exchange 5 4 305 111 7 11 12 activity, service management, and tourism and 52 41 out-of-school specialized number of number of art and music institutions of sport trade. All of the institutions are open for pre-schools general education educational preschool groups in workshops in schools vocational schools cooperation with business entities, e.g. in the field institutions of institutions institutions pre-schools pre-schools education of improving students’ practical knowledge as it different types will help prepare them for the modern workplace. 2 , colleges, gymnasiums, schools for children with According to the IRI research, in 2018, specialized secondary schools visual impairments and Khmelnytskyi ranked sixth among regional mental and physical disabilities centers of Ukraine for quality education opportunities in different specialties and levels. 13,356 35,213 Moreover, the City is ranked third for the quality children were enrolled pupils were enrolled level of school education and second in Ukraine in pre-schools in 2019 in secondary schools in2019 for the quality of preschool education.

Universities

Because of the high level of quality of life in the City and wide range of educational opportunities in technology, engineering, economics, social 30 000 sciences and many others students choose 18 students Khmelnytskyi. Despite the decline in the total higher education number of students in Ukraine, the number of institutions students in Khmelnytskyi has remained steady. In total, there are more than 18,000 students enrolled in higher education institutions. 9 9 colleges, technical universities, academies, The City’s universities are interested in improving schools institutes the quality of educational services, attracting foreign students and offering wide range of training courses to provide the labour market with a capable workforce.

30 31 Khmelnytskyi • economy Khmelnitsky • software engineering Universities University of • management of organisations and Polytechnic • applied mechanics • industry-specific engineering Management administration College of Lviv • automobile transport and Law • management Polytechnic Public Universities National University • computer engineering • administrative management • finance, banking and insurance • management Khmelnytskyi Economics • electricity, electronics and • public administration • economy • hotel and restaurant business National University electromechanics • tourism • software engineering • business economics and analytics • material science (restoration and technical • law • business Economics service of cars) • international law • management • economic Cybernetics • applied mechanics (instrumental • social welfare Khmelnytskyi Branch • accounting and taxation production) Campus of • law • entrepreneurship, trade and stock • administrative • applied mechanics (metal cutting Khmelnytskyi • finance, banking and insurance Donetsk National market activity machines and systems) management Cooperative Trade • accounting and taxation University "Business • public administration • applied mechanics (engineering • entrepreneurship, trade and Innovation Center • finance, banking and insurance and Economic technology) stock activities "DonNU-Podillya" • economic security Institute • industrial labor protection • law • energy management • marketing Management and marketing • electrical appliances • hotel and restaurant business • HRM and labor economics • engineering technologies • computer engineering • marketing • management (business services, Khmelnytskyi • psychology • customs business Computer systems tourism and trade) Institute of Social • social work • management of organizations • automation and computer-integrated Technologies • law • business management and administration technologies of the Higher • management of foreign economic activity • software engineering The City’s universities are interested in improving the Educational • management of innovation activity • cyber security quality of educational services, attracting foreign Institution “Ukraina” • computer engineering students and offering wide range of training courses to International relations • programming and protecting computer provide the labour market with a capable workforce. • international relations, public systems and networks communications and regional studies • data analytics and mathematical modeling • International Economic Relations • computer science and information • international logistics and customs technology Private Universities • international business • telecommunications and radio engineering • tourism Technology and design University of Khmelnytskyi Institute of Engineering mechanics • design (clothing design, graphic design and Economics and “Higher Educational Institu Khmelnytskyi • road transport advertising design, interior and furniture Business tion “Interregional Academy- Economic • agricultural engineering design) of Personnel Management” University • architecture and urban planning • fashion in light industry • industry mechanical engineering • chemical technology and engineering • accounting and taxation • economics • accounting and taxation • industry mechanical engineering • light industry technologies (design and • entrepreneurship, trade • finance, banking and insurance • tourism (light industry machinery and equipment) construction of footwear and and exchange activities • law • finance, banking and haberdashery goods) • economics • tourism insurance • finance and credit • entrepreneurship, trade and • management stock activities

32 33 Key Sectors

Photo: Andrii Maslov Trade and Services

In recent years, the network of trade, restaurants and Khmelnytskyi Clothing Bazaar. Key Facts entertainment, and consumer services (Spas centers, Strengths barbershops, cosmetic services and many other kinds of Khmelnytskyi Clothing Bazaar is considered one Gradually, the presence of the large market services), including those operating under the terms of of the largest in Ukraine and Eastern Europe. Its positively influenced the development of other a franchise agreement, have grown rapidly. total area is more than 30 ha. industries in the City, in particular, contributed to the rise of the local garment industry, One of the City’s priorities is to develop the market The market opened in 1987, grew into a large manufacturing, and construction industry. new methods new technologies growing number of infrastructure, shopping centers, and hotel and restau- market complex and is one of the well-known rant network, creating favourable working conditions for of trade supermarkets and continuously operated whole sale and retail Khmelnytskyi Clothing Bazaar is a place of employees and improving the level of customer service. shopping malls clothing markets in Ukraine. business for more than 7500 entrepreneurs, merchants and employees. The local market’s basis is the driving force behind its In the context of the crises of the 1990s, the development. market played an increasingly important role in Today the market includes 24 independent contrast to trade in stores, and for thousands of profile consumer markets (according to the the inhabitants of Khmelnytskyi as well as for types of the consumer goods). representatives of other cities and regions of Ukraine, Belarus and Russia, it often was the The most popular goods are clothing (winter As of 2019 there are only way to avoid unemployment. coats and wedding dresses above all), footwear, tulle and other textiles, as well as wedding 1,900 496 429 41 45 ha In the 1990s, the Khmelnytskyi Clothing Bazaar accessories and goods for arrangement of home shops restaurants and catering household services markets the area of markets in the city was the most stable working and growing place. establishments in the City enterprise in the City of Khmelnytskyi, and thus a large urban employer contributing greatly to the city’s budget.

The Volume of Retail Sales Volume in Services, Turnover, billion UAH / million EUR billion UAH / million EUR

₴5,24 / ₴6,29 / ₴6,09 / ₴6,74 / ₴5,58/ ₴1,4 ₴1,7 ₴2,1 ₴2,5 €163 €195,7 €189,5 €209,7 €189 €43,6 €52,9 €65,3 €77,8 2015 2016 2017 2018 Jan-Sep 2015 2016 2017 2018 2019

36 37 Garment Industry Strengths Educational Institutions The strong garment industry in Khmelnytskyi Number of students Number of encourages many young people to choose Field of study 2018/2019 graduates in 2019 technical education during upper secondary Tailor, cutter 158 137 school, as they seek training in garment manufacturing technology, technology of Sewing 269 54 accessible education qualified and talented fashion geographic proximity of the garment production, design of clothing and Operator facilities experienced personnel designers Eastern and Central related subjects. European markets Technology of the 288 54 garment industry The garment industry is supported by technical The Clothing and Textile Industry belongs to the products Khmelnytskyi is a strong center for apparel and infrastructure facilities and professional industries in which the City traditionally has a strong production. The local enterprises produce: staff, largely graduated from Khmelnytskyi competitive position. In order to stimulate its further • dresses Center for Professional Services Education, development, one of the strategic objectives of the City • coats, short coats, capes, raincoats, anoraks, Khmelnytskyi Professional , and Development Strategy by 2025 is the development of an windbreakers, windproof jackets, including Khmelnytskyi National University. ecosystem of apparel and agro-processing industries. skiing sportswear and other articles • trousers and breeches of wool or fine animal The City continues to promote and popularize apparel of hair, synthetic or artificial fibers the local clothing industry and host fashion festivals and • knitted underwear. shows. Khmelnytskyi has a huge potential for the export of garments internationally. There are many talented designers in the City and the city government supports the local producers, encouraging them to unite efforts for ₴ 1.05 billion the joint promotion of clothing products to foreign 13,3% markets. of the city processing € 35.3 million industry the volume of industrial In 2019, as part of the Modni project the City hosted an production of light industry, inaugural fashion show for kids and adults, aiming to which amounted to support the local producers. The fashion show will be planned annually in Khmelnytskyi.

Khmelnytskyi trademarks are grouped into a cluster of 15 trademarks. Twice - in 2019 and 2020, local fashion industry representatives have presented their collections at Kyiv International Fashion Festival under the same brand as «Podillya Women Apparel Cluster».

38 39 Food Processing Crop area Of all categories of 576,200 ha stockbreeding farms were sold grains and pulse crops Khmelnytskyi region is rich in land suitable for 91,100 tons cultivation of all kinds of plants of the moderate 1.8 1246 € 497,9 27,200 ha of meat climate zone and is one of the regions with the sugar beet 2 640,000 tons highest insolation levels in Western Ukraine. 140,200 ha mln ha kWh/m million of milk of the region are insolation level exports of sunflower Khmelnytskyi region ranks sixth by agricultural arable land annually – the agricultural 1027.3 million production volume in Ukraine with 5.6 percent highest level in products in the 179,300 ha eggs of all products in the country. Khmelnytskyi is Western Ukraine region (2019) soya surrounded by highly-efficient orchards 5 tons idealfor fruit and vegetable processing. ~3.8 million tons of wool of early grain crops was harvested in 2018 Khmelnytskyi region ranks third in Ukraine in sugar beet production and the number of sugar 67.2 tons/ha Production of food and factories in the country. >20 ₴ 960 million of the yield amounted and ranked export countries € 32.5 million in the 1st place in Ukraine processing industry In 2018, the total sown area of all types of farms amount of the production of food 193,400 tons in the region was 1.181 million hectares, which is and beverages in the city in 2019 Average crop yield in 2019 white granulated sugar 15 thousand hectares more compared to the previous year. 36.6 centner/ha 3,300 tons Exported in 2019 (mln USD) sunflower refrigerated poultry meat The Main Department of the State Service of 10,800 tons Ukraine for Food Safety and Consumer 26.6 centner/ha butter Protection, which is located in the City, is an 230.3 20.3 6.06 soya vegetable products finished food products executive body responsible for implementing of of grains 65.9 centners/ha 42,300 tons the state policies in the field of veterinary total grain yield unrefined soybean oil medicine, safety and specific indicators of food 1.86 8.15 3,200 tons quality, quarantine and plant protection, animal live animals and fats and oils of animals 513 centner/ha solid and processed cheeses identification and registration, sanitary animals products or vegetables sugar beet legislation, etc. 91,200 tons Gross production of flour individual crops 101,100 tons 45 processed milk food and processing industry The City has considerable potential to 1.4 million tons sugar raw materials enterprises have been certified in become a logistics center of accordance with the requirements of agro-processing and the food industry, 1.1 million tons the international quality management as well as the location for an potatoes systems and food safety, the ISO 9000 agro-industrial cluster. series, ISO 14000 series, ISO series 250.4 tons 22000, international HACCP system. vegetables

40 41 Food Processing

The head offices of large agro-industrial companies located "Evromost-EXIM" and PJSC "Khmelpyvo" "Ukr-Walnut" Group PJSC "Khmelpyvo" is one of just a few in Khmelnytskyi breweries in Ukraine built in the "Evromost-EXIM" and "Ukr-Walnut" pre-revolutionary period. The company Group is one of the leading companies uses ingredients grown in fertile lands Svarog West Group Dubovo-agro LLC engaged in sale of walnuts. of Khmelnytskyi region. Their "live" beer Corporation “Dubovo-agro” is a company with more The companies supply customers from is produced without the use of than 10 years of experience in trading of Ukraine and other countries. Svarog West Group Corporation is a preservatives and pasteurization, and is fresh fruits and vegetables. In 2013, the The products are subject to a strict rapidly growing agrarian company. At bottled exclusively in environmentally company started to expand quality control to meet international the present time the corporation friendly packaging. consolidates companies, which operate greenhouses aiming at growing local standards. in all spheres of agriculture (crops, vegetables. Today the company grows The main advantages of khmelpyvo.com livestock and horticulture) in cucumbers, tomatoes and salads. "Evromost-EXIM" and "Ukr-Walnut" Khmelnytskyi, Chernivtsi and Zhytomyr However, the production covers only a companies are: Family House of Exquisite regions. part of the local market needs. • all products meet state Sweets "Nasoloda" Therefore, the company is actively standards and UNECE DDP-02; Svarog West Group Corporation offers "NASOLODA" is a family business, a working on further expanding its • quality packaging fully plant growing, livestock farming, and modern enterprise, and a regional greenhouses. preserves the taste and useful horticulture services. The company leader in the production of cakes and properties of the products; produces grains and pulse crops, dubovo-agro.com/en/pro-nas/ cookies. • the best price and quality; including wheat, oats, barley, sugar The products of "NASOLODA" are • constant availability of fresh beets, corn, silage corn, sunflowers, made from high quality natural Proskuriv-agro LLC products in stock; soybeans, and rapeseed; fruits, materials and do not contain any Proskuriv-Agro LLC is a successful • fast execution of orders; including apples, pears, and plumps; preservatives. The technological modern meat processing plant founded • possibility of goods delivery by juices; seeds; sugar; milk; and beef. process is carried out under the in Khmelnytskyi in 1999. In 2000, it road to Europe; Additionally, it offers dairy farming; constant and strict quality control of started production under the • flexible system of discounts for grain, fruit, and vegetable storage; the products. The high quality is trademark "Khmelnytskyi Delicacies". regular customers. agricultural machinery distribution guaranteed. Great taste, original and services. Over the past 17 years, the company has established itself as a leading ukr-walnut.com unique design are the main attributes svarog-agro.com/en/home producer of quality sausages, smoked by which it is easy to identify the sausages, and semi-finished products. PJSC "Khmelnytskyi "NASOLODA". Maslosyrbaza" nasoloda.com.ua Agroholding 2012 LLC The production capacity of the company is one of the largest in the Company produces more than 10 Agroholding 2012 LLC unites Cheese Dairy “Iberia” region. "Khmelnytskyi Delicacies" varieties of cheese, including Parmesan enterprises specializing in the Cheese Dairy “Iberia” guarantees the delivers their products to most regions cheese, processed cheese and other cultivation of grain crops (except rice), production of products only with the of the Western Ukraine and Kyiv. cheese products, soft cheese, butter legumes and oilseeds; growing and spreads, whole-milk products, status "Natural product". Great care is vegetables and melons, root crops and delikates.com.ua dairy drink powder. taken to insure that the natural raw tubers; growing of spice crops. materials are of the highest quality. The msb.km.ua/en/about-company use of preservatives, dyes, emulsifiers, stabilizers, vegetable fats and other types of food additives is not allowed for the production of products. iberia.biz.ua/index.php/ua

42 43 Construction Industries and Logistics

The construction industry in Khmelnytskyi is Khmelnytskyi is a center of engineering industry booming and trying to meet rising demand for – local enterprises manufacture products such Strengths commercial and retail space, building as electric transformers, electroplating thousands of new homes and apartments. equipment, equipment for printed circuit available and high demand boards production, pipe welding equipment, The majority of the City's residential areas are low-cost building for real estate metal products, concrete mixing equipment, connected to municipal utilities. There is a materials agricultural equipment, trailers, and dairy tendency toward the development of equipment. technical and rich traditions geographic geographical autonomous heating systems. infrastructural of Khmelnytskyi proximity location facili- facilities engineering to Central tates business Khmelnytskyi construction industry also ₴ 1.9 billion 52.4% industry and Eastern expansion to the benefits from available labour and low-cost € 64.3 million construction work European EU and Eastern building materials. of construction work in the completed by the city markets Neighbourhood City completed in 2019 in the region

151 thousand m2 46.56% ₴ 413.6 million of housing were approved of the total new housing capital investment in for occupancy in 2019 in Khmelnytskyi region housing building

₴ 14.87 billion ₴ 55.1 thousand ₴ 86.5 million ₴ 1,369 million € 503.2 million € 1.86 thousand € 2.9 million € 46.3 million The average cost of housing in new buildings volume of sold volume of sold industrial manufacture of furniture mechanical engineering, industrial products production per person and other articles, repair and except repair and installation in Khmelnytskyi and other regional centers installation of machines and of machinery and equipment UAH / EUR / m2 equipment

Khmelnytskyi ₴ 10,120 / € 340 Ternopil ₴ 13,400 / € 445 Zhytomyr ₴ 14,100 / € 470 Chernivtsi ₴ 14,500 / € 485 ₴ 15,100 / € 510 Vinnytsia ₴ 17,100 / € 570 ₴ 506.2 million ₴ 3,3 74 million ₴ 195 million ₴ 348.3 million Lviv ₴ 19,600 / € 650 € 17.1 million € 114.2 million € 6.6 million € 11.8 million Kyiv ₴ 27,500 / € 915 metallurgical production of rubber production of chemicals manufacture of wood production and plastic products and chemical products products, paper production and printing

44 45 Turnover Engineering Industry Industries and Logistics “Valon – А” Ltd. Production of transformer substations ₴ 10.1-100.0 valon-a.org mln / Turnover Production of building materials Ukrelcom Ltd. Production of transformers €315,000 ukrelcom.com over ALC "Khmelnytskzalizobeton" Production of building materials hzb.com.ua – 3,34 million Private industrial and commercial Production of molds for thermoplastic machines ₴ 100 million/ firm “Bdzhilka "Тіn-Іmpex" Production of aluminum foundry alloys gesal.com.ua € 3,34 million tinimpex.com "Valder" Ltd. Production of concrete mixing equipment "Nail" Ltd. Production of nails by European standards www.walder-ltd.com uk.nail.com.ua PJSC “Zavod “TEMP”” Production of electroplating equipment, equipment for printed “Dortrade Podillia” Ltd. Production of non-metalic mineral products www.temp-mash.com.ua circuit boards production, pipe-welding equipment, metal products “Duvelsdorf Ukraine” Ltd. Production of hinged agricultural equipment duevelsdorf.com.ua Engineering Industry Scientific and production firm Production of spare parts for sugar industry equipment State Enterprise “Novator” Production of special equipment, automatic switches, r “Advismash” novator-tm.com ailway equipment, automatic control system and accounting www.advismash.com.ua of energy carriers, meters, led lamps, medical equipment “Santey” Ltd. Production of trailers santey.com.ua PJSC “Ukrelectroaparat” Production of electrical products uea.com.ua “PRYGMA-PRES” Public Company Production of equipment for wire products manufacturing prigma.km.ua “Transformator Service” Ltd. Electric transformers production transf.com.ua PJSC for technical operation and Production, operation and service of dairy equipment service of dairy equipment “Tesmo-M” Khmelnytskyi branch of SE Wiring harness and cable products tesmo-m.com.ua Bordnetze Ukraine LLC “R.І.N.О” Ltd. Production of agricultural machinery Production of chemicals and chemical products tov-rino.com.ua “Sirius Extrusion” Ltd. Production of industrial and individual polymeric packaging sirius.pro Production of chemicals and chemical products “SCIENTIFIC-MANUFACTURING Production of soap and detergents, Textile production, clothing, leather goods and other materials ENTERPRISE “ARTHIM”” Ltd facilities for cleaning and polishing

“Karat” Ltd. Production of carpets and rugs Production of goods out of polymeric materials karatcarpet.com “Ecoplast” Ltd. Private Enterprise “Aslan-Tekstil” Production of knitted fabric “Poli-pak” Production of other plastic products aslantekstil.prom.ua poli-pak.km.ua Wood products, paper production and printing activities “2К” Ltd. Production of soap and detergents, facilities for cleaning and polishing Private Enterprise “Pryvatna Drukarnia” Printing services drukar.com.ua Production of building materials Food production “Europe – Export plus” Ltd. Production of foundry alloys europaexportplus.com PJSC «Khmelnytska Maslosyrbaza» Milk processing, butter and cheese production msb.km.ua/ua Khmelnytskyi branch of Production of metal building constructions “Arsenal-center” Ltd. “Trade House “Khmelnytskkhlib”” Manufacture of bread and bakery products; production of flour confectionery, arsenal-center.com.ua cakes and short-term cakes 46 47 “STEELART.UA” Ltd. Production of metal building constructions steelart-ua.com Industries and Logistics ALC “Khmelnytskyi plant of Production of building materials building materials” Industry development is supported by University. More than 1,000 students Khmelnytskyi unit of “Plant of Production of building materials Hydroarmatura” Ltd. technical and infrastructural facilities are currently enrolled in the fields of gidroprom.com.ua as well as by professional staff, largely study related to this sector. “Мriya Zabudovnyka” Ltd. Production of building products out of plastics graduated from Khmelnytskyi National mz.km.ua “Budmaterialy” Ltd. Production of building materials Number of students Number of Many young people choose technical “Vesnyanka” Ltd. Production of metal plastic windows Field of study 2018/2019 education during upper secondary vesnyanka.com.ua graduates in 2019 school in the field of automotive Software 108 16 Private Enterprise “Novi tekhnolohii” Production of building products out of plastics technology, machine science and engineering novit.com.ua related subjects. Private Enterprise “Window systems EM” Production of building products out of plastics wsem.com.ua Computer 265 24 engineering “CLEVER PRODUCTION GROUP” Ltd. Production of plastic plates, sheets, pipes and plastic profiles clever-decor.com Applied mechanics 118 30 Vocational and technical Private research and production Production of additives to building mixtures, educational institutions enterprise “Corpuscula” metal plastic windows

Wood products, paper production and printing activities Material science 106 27 Number of graduates “Еna” Ltd. Production of printed products in 2019 “Grass” Ltd. Production of corrugated cardboard, paper and cardboard packaging Industry engineering 142 23 Locksmith, 278 fitter “СNЕ.Т” Ltd. Production of paints, varnishes and similar products, printing inks and mastics Electricity, 161 25 Electrician 73 “Polihraphist – 2” Production of cardboard packaging and printing products electrical engineering poligrafist.com and electromechanics Textile production, clothing, leather goods and other materials Telecommunications 132 14 Welder 155 "Litma" Production of footwear and radio engineering litma.com.ua Commercial and Industrial Production of garments Light industry 288 21 Enterprise “Universal” Ltd. technology universal-ua.com “Bembi” Ltd. Production of children's clothing from the first days of life Chemical technology 41 41 bembi.ua and up to 7 years and engineering Other industries State Experimental Prosthetic and Production of prosthetic and orthopedic products Orthopedic Enterprise protez.km.ua “Metalservice” Ltd. Disassembly of machinery and equipment, recycling of sorted waste

48 49 Industries and Logistics BPO / SSC / IT sector

The network of roads Kyiv-Lviv, Odessa-Lviv, 24 hours via road transport, you can reach According to the Khmelnytskyi Development Chernivtsi-Kyiv, highways Zhytomyr-Chernivtsi Warsaw, Moscow, Istanbul, Helsinki, Prague, Strategy by 2025, the ecosystem of IT sector Strengths (Н03) and a part of the international route Berlin and Bucharest. and creative industries will be formed in the E50 - the road Stryi - Ternopil - Vinnytsia - City. A special platform is being designed for Kropyvnytskyi - makes Khmelnytskyi Khmelnytskyi has the potential to become the various IT initiatives and synergies between an ideal location for the development of the TFL main logistical center of the Western Ukraine. them, providingnew opportunities to bring (Transport, Forwarding, Logistics) sector. The principal reasons are its favourable together the efforts of the City administration, rapidly growing office rental rates availability of local businesses and the community for the City geographical position and developing transport office space market up to 20% lower qualified staff infrastructure network, as well as the sustainable development. Khmelnytskyi also has an excellent than in central and geographical position for businesses that want accessibility of resources necessary to western Ukraine to combine development within Ukraine and implement large-scale logistic investments. expansion to the markets of the EU, Russia, € 118,800 >35 Belarus, and other Eastern Partnership The region also offers space for construction of valuation of the City city enterprises specialize countries, Turkey, Central Asia and China. the warehouses at relatively low prices. The City exported services in in providing IT and SMM continues to advance infrastructure the field of IT in 2019 services and business Kyiv, the capital and the largest city in Ukraine, is development making the region more friendly business city authorities relatively low labour outsourcing services. Some only four hours away from Khmelnytskyi. Within investment-friendly. climate are ready to costs (the average of them are enterprises support ideas salary in the city’s with foreign investments IT sector is about € 340 a month) Logistic Centers in the city The IT industry is a powerful base of talented Nova Poshta LLC, a leader in express shipping in Hrechany is a central district station of the and highly educated specialists in the City. The Ukraine, received 9.5 million euros funding from Directorate of the South-Western Railway of City's experts provide IT services for well-known the European Bank for Reconstruction and . The Hrechany Station is a large companies such as Panasonic, Oracle, Intel, Development (EBRD) for construction of junction for railway transport and provides Microsoft, MasterCard, Lenovo, Ericsson, Bayer, infrastructure facility in Khmelnytskyi. The transit, cargo and passenger transportation. Ford, Deloitte, Google, and Corel. sorting terminal in Khmelnytskyi is modernly From the station, depart lines run to Ternopil, equipped, the average throughput is , Zhmerynka and . approximately 8,500 parcels per hour. The The station is a transit point and has six main total capacity of sorting is 18,000 shipments per tracks, seven receiving-departure tracks and 10 hour. Implementation of the automated sorting sorting-departure tracks. terminal in Khmelnitskyi helped to increase the efficiency of loading cars by 20 percent and reduce emissions of atmospheric CO2 by 1,200 tons per year. The facility is the second largest innovative terminal in Western Ukraine.

novaposhta.ua/en

50 51 Business Environment

Photo: Oleksandr Savenko Business Environment Industrial Park

>3,500 20% 58 According to the decision of the session of the ₴ 2,3 mln business entities are legal entities small enterprises on Khmelnytskyi City Council № 15, the Concept of the € 77,8 registered annually Khmelnytskyi Industrial Park was approved and the 80% 10 Khmelnytskyi Industrial Park was established. funds were available to reimburse private thousand people By the order of the Ministry of Economic Development 14 businesses for interest on new loans in 2019 entrepreneurs dated 18.02.2019 №188 the industrial park "Khmelnytskyi" is included in the Register of industrial The official site of the City Council https://khm.gov.ua/en is modern, producers in fair events from the city budget”. For 2019, 3 companies parks. A detailed survey of the soil of the land plot for well-structured and useful for business representatives. There is a were compensated for participation in exhibition activities in the the industrial park was carried out. Preparations are section that publishes all documents approved by the local authori- amount of 133 thousand UAH. (50% of participation). ties: decisions of the City Council and the Executive Committee, In Khmelnytskyi, the information provision for businesses is constantly underway for project works on the arrangement of orders of the , regulatory acts, etc., as well as draft decisions. being improved, namely, the open unrestricted access to the General transport infrastructure. Preparations are underway for News is regularly updated. Plan, the zoning plan of the City, the town-planning cadastre and a competition to select a management company. Different thematic sections such as "For Citizens" and "For Business" other city-planning documentation. Establishment of the industrial park “Khmelnytskyi” can be found. Key administrative bodies of the Khmelnytskyi region are located in provides new opportunities for industrial development, In particular, the section "For Business" contains the strategy and the City, as well as a system of providing administrative services; 217 strengthening cooperation between companies, plans of the city development, business development programs, administrative services and issuance of 23 types of permits are investors, local governments, economic development information about the main enterprises of the city, information about available. administrative services for economic entities, information on compe- Potential investment objects are identified and accessible; institutions and other stakeholders. titions, auctions and rent of municipal property, links to Khmelnytskyi information and terms are available at https://invest.khm.gov.ua/en. investment profile. Service infrastructure for business has a sufficient level of Registration of a new business is free of charge and takes place within development. Total budget revenues in 2019 amounted to UAH 3.15 Location: Khmelnytskyi, one day at a single location. The cost of registering a property is UAH billion/ EUR 106.6 mln, of which 61% are own revenues. Part of the 18 Vinnytske Shosse Str. 190 – 9,610 and can take from 2 hours to 5 working days. Construc- money is steadily channeled to infrastructure development tion permits are free of charge and are approved within 10 working In order to develop and popularize entrepreneurial activity, to form days. the knowledge necessary for young people to start their own business, Total area: 90.9324 ha In order to increase the access of local producers to participation in the City Council has created projects of the School of Financial exhibition and fair events, in 2019 the City Council approved the Literacy and Business English “Smart Finance” and “Young “Procedure for partial compensation of participation of local Entrepreneur School”. The network of banking institutions serves the city business Establishment of an industrial park has a lot of advantages Number Number Name of the bank of offices Name of the bank of offices tax incentives government support PJS CB “Pryvatbank” 20 PJSC "CB"AKORDBANK" 2 • duty exemptions for equipment used • interest-free loans JSC “Oshchadbank” 19 PJSC “UKRSOTSBANK” 1 during industrial park arrangement; • irrevocable target financing for PJSC “Alfa-Bank” 5 JSB “PIVDENNYI” 1 • duty exemptions for equipment industrial park arrangement2. PJSC “А – Bank” 4 JSC “OTP BANK” 1 used for business activities JSC “Ukrsybbank” 3 PJSC “Sberbank” 1 within the industrial park1 PJSC “Credobank” 2 PJSC “UNIVERSAL BANK” 1 1 Part 6 of Article 287 of the Customs Code of Ukraine JSB “Radabank” 2 PJSC “PROMINVESTBANK” 1 2 Clause 9 of Article 27 of the Law of Ukraine “On Industrial Parks” JSC “Raiffeisen Bank Aval” 2 PJSC “CREDIT AGRICOLE BANK” 1 PJSC “Pumb” 2 PJSC “ОКСІ BANK” 1 JSC “UKREXIMBANK” 2 PJSC “ІDEA БАНК” 1 JSB “UKRGASBANK” 2 PJSC “MEGAБАНК” 1 PJSC “TAKSOMBANK” 2 PJS CB “PRAVEX-BANK” 1 PJSC “SBERBANK” 1 54 55 Structure of the local budget Local Taxes and Fees

Share of the major budgetary sources in the structure of own revenues, 2019 (UAH mln) Tax on real estate other than land

Income Tax of Individuals 1003.6 55% Residential property tax is 0.5 percent of the The tax base is reduced by 60 square meters for Single tax 274.3 15% minimum wage per 1 square meter of residential apartments and by 120 square meters for property owned by one owner: houses regardless of their number. Excise tax 148.7 8% • for apartments, total area of which The tax period is one calendar year. Payment for land 147.5 8% equals up to 300 square meters If the area is larger than indicated (more than • for residential houses, total area of 300 square meters for apartments and more Own revenues of budgetary institutions 129.2 7% which equals up to 500 square meters than 500 square meters for houses) the Fee for administrative services 30.5 2% • for different kinds of residential amount of tax increases by UAH 25,000 / EUR property, total area of which equals up to 500 778 per year for each object of residential Real estate tax 19.7 1% square meters. property. Deposit fee 12.5 1% Equity funds 10 0.5% Non-residential real estate tax depends on the property type Others 49.6 3% Objects of non-residential property Tax rate Objects of non-residential property Tax rate Hotel buildings (hotels, motels, campsites, boarding Buildings of public catering establishments houses, tourist centers, camps for rest, holiday homes) (restaurants, bars, cafes, dining, snack bars, etc.) in the central part of the city 0,25 in the central part of the city 0,25 Development budget (UAH mln) in other parts of the city 0,125 in other parts of the city 0,125 Department of Housing and Communal Services 154.2 64% Office buildings: Medical institutions of private ownership: Department of Communal Construction 53 22% 1) financial service buildings (banks, credit unions, in the central part of the city 0,25 pawnshops, leasing companies, trust companies, Department of Education 13.1 5% insurance companies, institutions for accumulation in other parts of the city 0,125 Department of Social Protection of the Population 7.5 3% of pensions, investment funds and companies and Covered markets 0,1 Department of Health 5.5 2% other legal entities that provide financial services) Garages (ground and underground) 0,05 and covered parking lots Executive Committee of the City Council 1.7 1% in the central part of the city 0,5 in other parts of the city 0,25 Stations, bus stations 0,05 Department of Youth and Sports 1.4 1% 2) administrative buildings 0,125 Other buildings: Trade buildings (shopping malls, department in the central part of the city 0,25 stores, shops, pavilions and halls for fairs, bases and in other parts of the city 0,1 warehouses of trade, catering enterprises, buildings of consumer service companies, automobile repair shops) in the central part of the city 0,25 in other parts of the city 0,125

56 57 Trading and Office Centers Other taxes and fees The City is one of the most beautiful and 2 greenest regional centers of Ukraine, lies along ~110,000 m both sides of the Southern Buh River. Public the resources of modern Land tax 1 percent of the normative monetary valuation of land green areas include parks, squares, waterfront, trading and office spaces Land rent from 3 percent of the normative monetary valuation, depending on the with a total area of 113 hectares. The streets and in Khmelnytskyi in total purpose of the land plot squares of the City are filled with green chestnuts and linden trees, numerous Transport tax cars older than 5 years that have a value of more than 750 minimum flowerbeds and fountains. monthly wages are required to pay transportation tax. The tax rate is According to the safety rating of the regional set at the rate of ₴ 2,500 / € 77.8 per calendar year for every car that centers, which was published by the Institute of is subject to tax Public and Economic Research in May 2017, Tourist tax differentiated rates depending on the cost of hotel accommodation: Khmelnytskyi was recognized as the safest city • for domestic tourism - from 0.15% (the cost of living per day among other Ukrainian cities. up to UAH 300) – up to 0.5% (over UAH 1,800 per day) at the maxi- mum rate of 0.5% according to the Tax Code of Ukraine • for inbound tourism - from 1.5% (up to 300 UAH) – up to 5.0% (over UAH 1,800) at the maximum rate of 5% according to the Trading and office Construction Tax Code of Ukraine. Building Address floor space, m2 year Parking fee 0.05% of the minimum wage set for January 1 of the tax (reporting) year Mega Shopping Center 1 Proskurivskoho Pidpillia Str. 858.5 2003 (with a maximum rate of 0.075% according to the Tax Code of Ukraine) Rico Shopping Center 69 Prospect Myru Str. 820.4 2002 Epicenter Shopping Center 11/4 Zarichanska Str. 19316.2 2007 Single tax for small business entities the rates of the single tax for the first group of payers are set at 10 percent of the subsistence minimum (as of 01.01.2020 - UAH 2,027 / EUR 76.7), Oasis Shopping and Entertainment Center 2A Stepana Bandery Str. 27983.9 2008 for the 2nd group of payers – 15 percent to the minimum wage (as of Magnit Shopping and Office Center 21 Podilska Str. 1444.2 2005 01.01.2020 р. – UAH 4,723/ EUR 178.8). LM Shopping Center 11 Soborna Str. 864.3 2008 for the third group of natural persons - entrepreneurs according to the Tax Trade House LM 17/4 Vaisera Str. 677.4 2002 Code of Ukraine, the tax rate is set at 5 percent of the income (VAT) Passage Shopping Center 11 Soborna Str. 2293.6 2008 or 3 percent of the income (excluding VAT). Mandarin Plaza Trading Center 11 Soborna Str. 2800.0 2013 Dytiachyi Svit Shopping Center 4/3 Proskurivska Str. 1440 2000 Groups of single tax payers Agora Shopping Mall 2/1B Starokostiantynivske Shosse Str. 6573.5 2014 Atrium Business Center 63 Proskurivskoho Pidpillia Str. 3034 2004 1st group 2nd group 3rd group Kvartal Shopping and Entertainment Center 17 Kamianetska Str. 13000 2016 natural persons – entrepreneurs who natural persons – entrepreneurs who natural persons – entrepreneurs and Lybid Plaza Shopping and Hotel Center 21 Kamianetska Str. 3231.9 2008 carry out exclusively retail sales of carry out economic activities in legal economic entities of any EL Shopping Center 42/1 Nyzhnioberehova Str. 4500 2015 goods from trading places in the providing services, including household organisational and legal form Promenad Oleksandrivskyi Shopping Mall 16 Proskurivska Str. 3124.6 2011 markets and / or conduct economic services to single tax payers and / or the activities for the provision of household population, production and / or sale of SV Recreation and Entertainment Center 1A Svobody Str. 9000 2009 services to the population goods, restaurant services WOODMALL Shopping Center 6A Trudova Str. 9 100 2018 PARUS Business Center 1/1 Stepana Bandery Str. 5200 2018

58 59 Event and Exhibition Facilities Investments The national rating agency “IBI-Rating” assigned to the Khmelnytskyi has a rapidly developing business city of Khmelnytskyi the investment attractiveness rating support infrastructure. There are 16 hotels and 20 16 at invA+ level. A rating object with an invA+ rating is conference centers operating here, such as investment countries hotels and conference characterized by high investment attractiveness “Lybid Plaza” Hotel, “Colisei” Hotel and compared to other rating objects. The city is featured by a Restaurant Complex, “Panskii Mayetok” Hotel centers Considering foreign direct investments by the type of significant activity of investors providing the growth of and Restaurant Complex. activity, it should be noted that investors tend to invest in most basic indicators in the socio-economic area. the sectors with faster turnover and high profitability In addition, for the first time, the city's credit rating was (wholesale and retail trade, real estate transactions), as determined, according to which Khmelnytsky was rated at well as in already developed sectors. Thus, about USD the level of uaA. This means that the city is characterized 21.5 million of foreign direct investment is concentrated in by high creditworthiness. Based on the results of the enterprises of wholesale and retail trade, accounting Transparency International Ukraine's annual report, in for 63.8 percent of their total volume. 2019, Khmelnytskyi ranked third in Ukraine in About USD 11.5 million is directed towards development Hotel Address Conference Halls: number, capacity transparency in investment and economic development of the city industrial enterprises, which is 34.1 percent of among Ukraine's 100 largest cities. Vic Zhan Hotel Complex 5/1 Berezneva Str. conference hall for 40 persons the total volume, including USD 3.2 million to the produc- tion of rubber and plastic products, other non-metallic Eneida Hotel 8 Heroiv Maidanu Str. conference hall for 50 persons mineral products, and USD 7.2 million to production of Lube Plus Hotel and Restaurant Complex 18 Yevropeiska Str. conference hall for 65 persons food products, beverages, and tobacco products. Panskii Mayetok Hotel and Restaurant Complex 11 Verkhnia Berehova Str. 2 conference halls for 250/50 persons Direct investments (equity and Tsentralnyi Hotel 5 Haharina Str. conference hall for 70 persons Capital Investments debt instruments) in Lybid Plaza Hotel 21 Kamianetska Str. conference hall for 80 persons In 2019, the volume of mastered capital investment amounted to UAH 3.1 billion / EUR 105 million. Khmelnytskyi's economy, Shotlandia Hotel Complex 50 Zahidno-Okruzhna Str. panoramic hall for 35 persons Capital investment per capita in 2019 amounted to UAH mln. USA Podillia Hotel 34 Shevchenka Str. conference hall for 50 persons 11,600/ € 393. $ Colizei Hotel and Restaurant Complex 1A Chkalova Str. conference hall for 100 persons $ $ Imperia Hotel and Entertainment Complex 3/1 Kuprina Alley Str. conference hall for 100 persons Park-Hotel 103/3 Prospect Myru Str. restaurant room is available for 50-60 persons Yanisol Hotel and Restaurant Complex 40a Svobody Str. conference hall for 30 persons Foreign Direct Investments Sobkoff Hotel and Restaurant Complex 15/1 Prybuzka Str. conference hall for 100 persons As of 31.12.2019, the total amount of foreign direct investment attracted to the City's economy was $33.75 Arena Hotel and Restaurant Complex 20 Proskurivska Str. restaurant room is available – for 250 persons on million ($ 26 million as of 12.31.2018). The volume of the 40.1 40.4 51.7 the ground floor, for 100 persons on the first floor direct foreign investments per capita in 2019 was $125.1 SV-Club Health and Entertainment Center. 1A Svobody Str. summer terrace is available for 35 persons ($101.5 in 2018) 2017 2018 2019 Business Center 2 conference halls for 240/50 persons

60 61 Success Stories Success Stories

2K Joint Ukrainian- SEBN UA Karat Sirius Extrusion Duevelsdorf German Enterprise Company Ukraine LLC • household chemicals, cosmetics • high-voltage bundles «Karat» is a modern successful company and is • polymeric packaging Düvelsdorf Ukraine LLC is an enterprise with a • European quality • German investments EUR 5-6 mln the leader in the development of carpet • export to the EU countries 100 percent German investments, which • Wire harness production for such production in the textile industry in Ukraine. The produces equipment for agriculture and 2K is a joint Ukrainian-German enterprise that global brands as BMW, Mercedes-Benz, company exports products to more than 30 Sirius Extrusion Company was founded in 2000 forestry. The first products were shipped at the produces household chemicals: powders on a Volkswagen, etc. countries worldwide. «Karat» focuses on in Khmelnytskyi City. For 19 years, the company end of 2012 and sales have grown ever since. phosphate-free basis, cosmetics from natural increasing profitability and risk diversification by has succeeded in becoming one of the largest Finished goods are exported to , ingredients, in particular, gels for washing, liquid Four continents, 14 countries, more than 39 developing its own line of textile raw material producers of polymeric packaging products in , Denmark, France, Luxembourg, and soap, fat and stains removing agents, etc. The locations, and Khmelnytskyi is among them. production, which minimizes its dependency on Ukraine. The success of Sirius Extrusion is Switzerland. In 2016, the production area was quality of the products is constantly controlled Working at Sumitomo Electric Bordnetze raw materials and opens up a new market for supported by the constant expansion of tripled, new equipment installed, and the by the German laboratory and meets all EU (SEBN) means networking. With colleagues, synthetic fibers production. product markets, by establishing cooperation number of jobs increased. standards. The products are sold in Ukraine, and partners and customers. With the future of the with foreign clients from Russia, Azerbaijan, are also exported. automobile. But also with a very special More information: karatcarpet.com , , Latvia, Poland and other More information: duevelsdorf.com.ua corporate culture. Our company stands for countries of central and Eastern Europe. Sirius More information: 2k.company stability and continuity and is valued worldwide professionals managed to complete the for its fairness. development of an innovative product - the 31-layer Colchuga film, which is the most More information: 2k.company durable and economical polymeric packaging, and has no analogues in Ukraine.

More information: sirius.pro

62 63 Other Relevant Information

Photo: Vasyl Pavliuk Interesting Facts about Khmelnytskyi Annual Key Events in Khmelnytskyi

Khmelnytskyi has In 2019, the IRI ranked Khmelnytskyi the third place among Ukrainian cities by the level of • the largest number of the monuments to the diverse leisure opportunities. Broad access to Ukrainian Bohdan Khmelnytskyi in the public services, plenty of greenery within the world Christmas Fair Jazz Fest Podillia RockBuh City, various entertaining and catering City Day Translatorium • unique scrap metal sculptures by the artist festival rock festival establishments along with numerous places festival Mykola Mazur in the city where you can spend quality time – it all makes • 10 museums in a line in the main Khmelnytskyi a truly unique city. • the only museum-studio of photo art in There is an indoor water park "The 7th Ocean" in Ukraine the City, equipped with nine swimming pools, six • the only Kut mono-theatre in Ukraine adult slides and a water complex for children. • unique monument to Baron Munchausen There are 893 monuments and 122 cultural Khmelnytskyi economy Respublica • Khmelnytskyi is in the top five cities in Ukraine HlushenkovFolkFest The MoDni ArtMajorShow heritage sites in the City, including 115 development forum festival by the number of gas stations for electric trucks – International folk Project architectural objects representing the buildings dance festival from the beginning the last century.

February 20 - Khmelnytskyi Chamber Fest – August 8 Tolocar and scooter racing March 3 International festival of >200 chamber music August 14-15 Fashion Days in Khmelnytskyi – Cultural Life citywide and 10 large-scale cultural and the MoDni Project The most positive aspects of the quality of life in artistic events are held in the City each year. April 11 – Easter Fair Khmelnytskyi, which make the City a great place May 10 August 22-24 Parade and ethnic jamboree on Ukrainian Independence Day to live in are: May 16-17 Europe Day • security August 22-24 Tour of Starodub Brothers • quality of services May 23-24 Nova Poshta half marathon bicycle race • convenient city travel • public transport accessibility May 30-31 Rock&Buh festival August 28-30 Respublica International festival • sports infrastructure

• availability of preschool, secondary May 31 Twins Parade September 6 Peak of Freedom cycling and uphill run education, interest groups June Echo International one-man • affordable consumer goods and housing Show festival September 26-27 City Day • a clean and green territory June 13-14 Jazz Fest Podillia Festival September 26-27 Pidpillia Kavy coffee festival

June 20 Strong Men Games October 2-4 Translatorium – all-Ukrainian literary with V. Virastiuk and translation festival

June 20-21 MyFest youth festival October 14 Knight’s Cross festival of the rebellious spirit June 27-28 American Picnic November 6-8 Singing Assembly July 5-6 Celebration of Ivana Kupala December 1 - Christmas Fair January 19

66 67 Achievements

The Parliamentary Assembly of the Council of Europe (PACE) highly appreciates the efforts of the City of Khmelnytskyi's to work towards European integration, economic development, energy management and international cooperation and has awarded the City with the Flag of Honour (2017) and the Plaque of Honour (2019).

In 2017, the City joined the European Union's Mayors for Economic Growth Initiative (M4EG).

A Memorandum of Cooperation was signed between the Sid Forum Ukraine International Charity Fund and the Khmelnytskyi City Council to fund an iHUB Innovation and Entrepreneurship Support Center.

In November 2018, a Memorandum of Understanding between the Silk Road Alliance and the City of Khmelnytskyi was signed.

In January 2019, an agreement was signed with the European Bank for Reconstruction and Development on credit financing of the project for the modernization of the municipal solid waste infrastructure in the city.

In 2019, Khmelnytskyi was recognized the first in nomination “The Most Successful Ecological City” on the Eco Triumph contest within the fifth ecological forum “V Lviv Eco Forum 2019”.

Twin Cities Modesto

Karmel Silistra

Manises Beltsy

Shiauliai Bor

Akvaskalientes Ciechanow

Shytsziachzhuan Kramfors

Contact Info Khmelnytskyi Development Agency Phone: +38 0382 777110 Email: [email protected]

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