Biweekly news digest of the Ukrainian League of Industrialists and Entrepreneurs ISSUE 49 | 3 APRIL 2017 HEADLINES MINISTRY POINTS OUT MARKETS WHERE UKRAINE NOT USING FULL TRADE POTENTIAL UKRAINIAN PM, BUSINESS COMMUNITY AGREE TO STEP UP DIALOGUE BUSINESS NGOS, MEDICAL WORKERS DEMAND COMPREHENSIVE HEALTH CARE REFORM ECONOMY MINISTRY POINTS OUT 75 MARKETS WHERE UKRAINE NOT USING UKRAINIAN-GERMAN BUSINESS FORUM TO FULL TRADE POTENTIAL BE HELD IN BERLIN IN kraine’s Economic Development and Trade Ministry has pointed out 75 markets H2 2017 U in the draft exports strategy of Ukraine where Ukraine is not using the trade po- tential in full, seeing a shortfall of around $6 billion. According to the published document during its presentation, in particular, Ukraine in- sufficiently uses the opportunities of trade cooperation with the United States, Germany, UKRAINE INCREASES UK, France, Japan and Canada. PIPE OUTPUT BY 47% IN According to the strategy, exports of goods and services in 2012-2016 almost halved – JAN-FEB from $82.4 billion to $44.9 billion. The ministry said that the EU market share of total Ukrainian exports of goods over the UKRAINE’S period grew from 25% ($17 billion) to 37.1% ($13.5 billion), the India’s share rose from TRANSPORT 3.2% ($2.3 billion) to 5.2% ($1.9 billion), China’s – from 2.6% ($1.7 billion) to 5% ($1.8 ENTERPRISES billion). Exports of goods and services to Russia fell almost 80%, to from $17.3 billion INCREASE CARGO to $3.6 billion. SHIPMENT BY 13% According to the document, the share of Crimea, Donetsk and Luhansk regions of total exports of Ukrainian goods fell from 26.6% in 2013 to 10.4% in 2015 (data of the State Statistics Service, not taking into account the ATO zone and Crimea). In the period from EBRD COULD INVEST UP 2013 to 2015, exports from Donetsk region fell by 70% and from Luhansk region – by TO EUR 200 MLN IN 93%. UKRAINIAN The cost of exports losses due to these regions jointly with the temporarily occupied ter- AGRICULTURE IN 2017 ritory of Crimea was $12.9 billion, while total exports losses of Ukraine in the past two years amounted to UAH $25.2 billion. 2015-2017 Interfax-Ukraine | open4business.com.ua | uspp.ua/en | interfax.com.ua 1 BUSINESS UKRAINIAN PM, BUSINESS COMMUNITY NGOS, AGREE TO STEP UP DIALOGUE MEDICAL WORKERS DEMAND COMPREHEN- SIVE HEALTH CARE REFORM ilateral and mutually responsible dialogue between the government and the B industrial community with experts and business representatives is crucial for the formation of public policy. It is feedback from civil society, experts that makes govern- ment decisions efficient and ensures their detailed feasibility research and forecasts for possible consequences. This was discussed at a meeting of the business association con- usiness non - governmental sisting of the Ukrainian League of Industrialists and Entrepreneurs (ULIE), the Associa- organizations (NGOs), med- tion of Employers' Organizations, the Federation of Employers of Ukraine, the Chamber B of Commerce and Industry, and the Council of Entrepreneurs under the Cabinet of Min- ical workers and scientists demand that the Ukrainian government pro- isters with Ukrainian Prime Minister Volodymyr Groysman. pose a national strategy for develop- "We've shared our vision of the social and economic situation in the country, concerns ing Ukraine's health care system and about de-industrialization trends, and the loss of high-tech industries. The prime minister involve professionals in the review supported our commitment to strengthen industrial policy, to make cooperation in this of the state of health care. A respec- area between the government, the National Bank and businesses more efficient," ULIE tive address was sent to the President President and head of the Association of Employers' Organizations Anatoliy Kinakh has of Ukraine, the Verkhovna Rada and said. the Cabinet of Ministers following Representatives of the business community noted a further deterioration in professional- debates at the Ukrainian League of ism at the ministries and agencies, which is seen across the entire executive branch of Industrialists and Entrepreneurs power. These circumstances, in their opinion, hinder the development of high-quality and (ULIE). The document was signed modern economic policy. by the heads of the ULIE, the Feder- The sides also discussed the situation with tariffs and prices in the country. Members of ation of Employers in the Health the public stress that the national regulators, including the National Commission for State Care Sector, the National Academy Regulation of Energy and Public Utilities (NERC), should pay much more attention to of Medical Sciences, the League of feasibility study on the tariffs and be more open and transparent. And the government Insurance Organizations, the Heart must monitor that all changes in the tariff policy should to the maximum take into account Institute under the Health Ministry the real economic situation and the solvency of the population. of Ukraine, the Trade Union of The Ukrainian prime minister and representatives of the business associations agreed to Health Care Workers of Ukraine, step up communication, regularly exchange views, more actively involve the business and others. The next step should be community in the formation of the country's effective economic policy. the creation of an expert council under the Cabinet of Ministers for UKRAINE, SOUTH KOREA TO DEVELOP the development of a national strat- egy. The latter should clearly define AEROSPACE COOPERATION national policy on health care, form kraine and South Korea are working on boosting cooperation in the aerospace the basis for drafting detailed pro- U area. The press service of the State Space Agency of Ukraine (SSAU) reported grams, specifying technology, that further development of promising cooperation in the sphere was discussed at the fifth human resources, infrastructure, and meeting of the Ukrainian-South Korean committee for scientific and technical cooperation the sources of funding that will be of the relevant joint working group. "The sides discussed the state and prospects for de- involved. The document stresses the velopment of Ukrainian-South Korean cooperation in the current cooperation spheres and need for a clear analysis of the cur- studied the opportunities of developing cooperation in new areas, the satellite segment rent state of the health care sector in and the application of global space systems in the public economy sphere," the press serv- Ukraine and the health of its citizens. ice said. Representatives of South Korean Ministry of Science, ITC and Future Planning, Its findings will become the basis of Korea Aerospace Research Institute (KARI), the South Korean Embassy in Ukraine and an annual national report. representatives of SSAU, Yuzhnoye (Pivdenne) Design Bureau, Research and Production Health care workers and their part- Enterprise Hartron-Arkos Ltd. and the National Center of Space Facilities Control And ners from NGOs hope for the begin- Test took part in the meeting. South Korea is a promising partner of Ukraine in cooperation ning of joint work with government in the aerospace sphere in Southeast Asia. The sides have successful cooperation in the officials and parliamentarians in launch services: in 2013-2015 Dnepr carrier rocket placed South Korean satellites Komp- health care reform. Sat-5, STSat-3 and KompSat-3A to orbit. 2015-2017 Interfax-Ukraine | open4business.com.ua | uspp.ua/en | interfax.com.ua 2 UKRAINIAN-GERMAN BUSINESS CYCLONE-4M FORUM TO BE HELD IN BERLIN IN H2 ROCKET 2017 COMPLEX TO BE BUILT IN CANADA ON COMMERCIAL BASIS he volume of mergers and acquisitions (M&A transactions) in Ukraine in 2016 T increased by 20%, to EUR605.3 million, while their total number decreased by 2.6 times, to 54, such data are given in a report of CMS legal group. The largest transactions of the past year, according to the group, were exchange of assets between UniCredit financial group and ABH Holding (Luxembourg), within which the group transferred a 99.9% stake in Ukrsotsbank to the holding in exchange for a 9.9% stake in ABHH, the transaction was valued at EUR296.3 million; the purchase by Amer- he creation of the Cyclone-4M ican company Cargill of 51% of a transshipment terminal, which MV Cargo stevedoring T space rocket complex in company will build in Yuzhny port (Odesa region) for EUR90.9 million; the purchase Canada by 2020 will be carried out by Kernel agrarian group of the right of demand for Ellada oil extraction plant within the commercial project of the (Kirovohrad region) for EUR87.1 million; the purchase by Fairfax Financial Holdings space sector companies of Canada, the Limited international financial group of 9.99% in Astarta for EUR34.2 million; the pur- United States and Ukraine, the project chase by Dragon Capital Investments Limited of the Piramida shopping center in Kyiv will be funded by the Western in- for EUR21.9 million; the purchase by the Federation of Trade Unions of Tatarstan of the vestor, Pivdenne Design Bureau Foros sanatorium, which formerly belonged to Ihor Kolomoisky, for EUR16.7 million; (Dnipro), the Ukrainian developer of the purchase by 1+1 Media group of the Ukrainian satellite and Internet TV operator Vi- space equipment, has said. asat Ukraine from Swedish-based Modern Times Group MTG AB for EUR16.1 million; According to a report on the com- the purchase by the Rozetka.ua online store of a warehouse complex in Brovary for pany’s website, a number of Cana- EUR14.6 million; the purchase by businessman Sergiy Tigipko of Radisson Blu Hotel dian, American and Ukrainian in Podil in Kyiv for EUR9.2 million; and the purchase by Georgian Industrial Group of companies will take part in the cre- a 29.3% stake in PJSC Indar (Kyiv) for EUR4.3 million.