Malta-based cryptocurrency exchange Binance has agreed to help Ukraine prepare new rules for cryptocurrencies, as well as digitize the country’s finances.
Announced by the exchange Wednesday, Ukraine’s Ministry of Digital Transformation has signed a memorandum of understanding (MoU) with Binance to work together on “establishing the potential legal status of virtual assets and currencies in the country.” The ministry was founded in September to supervise Ukraine’s transition to a digital economy and online government services.
Under the MoU, Binance and the ministry will start a joint working group to discuss future crypto regulation and the creation of a digital asset market.
“Binance will also help develop transparent and effective mechanisms for the transfer of rights to any virtual assets or currencies using blockchain technology as well as beneficial conditions for investments and business in Ukraine,” a press release provided to CoinDesk explains.
Binance will meet with Ukrainian government officials during the upcoming visit of team to Kiev. In the announcement, Binance’s CEO Changpeng “CZ” Zhao described the new agreement as being positive for Ukraine, saying:
“The legalization of cryptocurrencies and corresponding adoption of progressive legislation in this sphere can become one of the key drivers in stimulating positive growth in the Ukrainian economy, as well as attract additional investments to the country.”
As of a few hours ago, it’s great to be back in Lviv, My first long vacation in years has ended, and I can’t wait to get to the office tomorrow. I spent some time in the US, and some time getting customer service, both in person and over the phone.
In the United States, there is over employment plus a huge influx of low-skilled migrats. The people with whom you often interact, unfortunately, are often unintelligent. It becomes obvious when you give them some abstraction, or ask them to generalize the broader policy. They either can’t do it well, or can’t do it at all. They follow a script, which is either the extent of their ability, or the extent of their training. It can be frustration. American businesses, facing an over-employed workforce, have had to create processes for everything so that they can 1) take advantage of the lower skilled labor that’s available, and importantly, 2) squeeze out of them $8.49/hour worth of productivity (US average minimum wage).
The plus side of this is that some of the processes are amazingly fast and efficient. Returning a rental car was literally less than a minute of interaction with the staff. That’s like magic.
In Ukraine, by contrast, a lower trust society, returning a car was a hour long process. They gave it a mechanical check prior to returning your documents. Perhaps things have improved since I rented a car four years ago, but the contrast exists elsewhere too. Businesses are less likely to open on time, especially outside of Kyiv. They may not be able to give you exact change. You may be expected to understand that you can’t be helped today because someone’s mother is sick and they had to stay home and take care of their parent until such-and-such a relative arrives from such-and-such a village.
The plus side of Ukraine, at least for visitors, is the under employment. When was the last time a McDonalds cashier delighted you with a witty quip? You can call a business and explain some nuance, and they’ll often understand you and react appropriately or explain something, or make a personalized adjustment. It’s nice.
And for some reason banks are awful experiences in both Ukraine and the U.S.
I do not know the background here at all. But there is a scary possibility. The President Zelenski used to work for arch-oligarch Kolomoisky, who recently returned from Israel where he had fled to escape prosecution. Kolomoisky is the owner of Ukraine airlines.
He has protected his turf before, intimidating Ryan air from Ukraine.
I think the minimum wage in the US, combined with low unemployment forces companies to try to squeeze $15 / hour of productivity from people who aren’t the most competent. You get people answering the phone who have no authority to make their own decision or take initiative, and who just follow a script.
In Ukraine, by contrast, the economy is still young, and not sorted out, so you have very talented people working in low positions. They think and they often have authority to make common sense decisions. Except for the banks. Stay away from Ukrainian banks.
Judging by income tax returns, Ukrainian declared incomes grew 7% last year, in post inflation terms. According to the State Fiscal Service, Ukrainians paid the hryvnia $3.6 billion in income tax, 17% more than in 2017. Inflation in 2018 was 10%.
See more great business headlines at https://www.ubn.news
This is really a great news source for business headlines about Ukraine: www.ubn.news
Here is a morning update from last week:
🔵Ukraine lost up to 15% of its record 70 million ton grain harvest due to improper storage and handling in transport, estimates Pro-Consulting. Investment is needed in silos and elevators. Competition is needed among the grain handling facilities at the nation’s 13 seaports, reports UNIAN, citing the Kyiv-based market analysis firm.
🔵Construction starts this summer on a $12 million grain storage and processing complex in the Bila Tserkva industrial park. Designed to ship gain by truck or train, the complex is to have the capacity to accept 3,000 tons of grain a day. In the summer of 2020, Volytsia-Agro LLC plans to open the complex which will have an elevator, grain dryers and silos for wet and dry grain. Vasyl Khmelnytsky, owner of the farming company and the industrial park, made the announcement on Facebook.
🔵Epicenter K Group is expanding its modern silo storage capacity to 1 million tons at eight locations, Svitlana Nykytiuk, tells Interfax-Ukraine. In July, the farming group plans to launch the first $30 million phase – 500,000 tons in four locations. While building rail tracks to two silos, the company also is spending $6 million to buy 100 grain trucks.
🔵Kernel, the agro giant, opened its new grain export terminal in Chornomorsk last month, adding one million tons of throughput capacity. By the end of this year, the company is to open a second phase, increasing its Chornomorsk throughput by an additional three million tons. Last month, Kernel, Ukraine’s largest vertically-integrated agribusiness, bought railcar company RTK-Ukraine. Dragon Capital writes: “With almost 3,000 grain hoppers, at a estimated valuation of $64 million, [Kernel] almost met its grain transportation needs, complementing the existing fleet of 500 wagons.”
🔵As demand grows to move grain, Sergey Tigipko is talking with foreign investors about expanding his grain wagon fleet as much as seven times, to 10,000 wagons. Tigipko, owner of TAS-Logistic, tells Novoye Vremya that his company now has 1,200 grain carriers.
🔵Ukrzaliznytsia has posted on its website a list of 301 ‘low-performing’ grain stations that are candidates for closure. During the last harvest season these stations averaged less than 2.3 grain cars a day, Andrei Ryazantsev, director of finance at the state railroad, tells the Center for Transportation Technologies. Last summer, Ukrzaliznytsia announced that 130 grain stations received less than one car a day. One grain hopper typically carries 70 tons of grain.
🔵Ukraine is the world’s largest exporter of millet, a grain used for food and fodder, according to Mordor Intelligence. The smallest of Ukraine’s grain exports, millet goes largely to Germany and South Africa. Ukraine exported 76,000 tons in 2016. By comparison, Ukraine expects to export 49 million tons of grain in the marketing year that ends this June.
🔵Ukraine, South Korea and the US are working with Science Technology, a Saudi company, to design and build an unmanned combat aerial vehicle capable of carrying tons of weapons. Details of the long range ‘unmanned bomber’ were revealed at IDEX 2019, a recent defense show in Abu Dhabi, reports Defense Blog news site. Citing interest by Middle East and North Africa militaries, the Washington-based blog reports: “The UCAV fleet in the region is forecast to increase from dozens of aircraft in 2018 up to 700 combat drones in 2028.”
🔵Ukrspetsexport, the military import-export agency, is building an armored vehicle assembly plant in Myanmar, reports Defense Blog. Equipment and production machines have arrived in Yangon for a plant that is to start operating next year, reports Defense Blog. The plant will assemble 8-wheeled BTR-4U armored personnel carriers, designed by Kharkiv’s Morozov Design Bureau. From the same Kharkiv company, the Myanmar plant will build 2S1U self-propelled Gvozdika howitzers. After Myanmar’s Buddhist majority government forced much of its Muslim minority to flee to Bangladesh, the US and the EU expanded existing bans on sales of arms and equipment that can be used for internal repression.
🔵President Poroshenko says Ukraine will start mass production this year of Neptun, a land-based anti-ship rocket, and Sokil, or Falcon, a reconnaissance and attack drone. Longer range – over 500 km – missiles could be developed now that Ukraine no longer considers itself bound by the defunct intermediate range missile ban treaty, Ukrainian diplomats say. On Saturday, Poroshenko said at a campaign rally in Chernihiv: “We are no longer bound by any limitations either on the range of our missiles or on their power. Let the enemy know about it, too.”
🔵US-based Curtiss-Wright Corporation has signed an agreement with Kropyvnytskyi-based RadICS LLC to market their nuclear power safety systems to US power plant operators. Under the agreement signed recently in Dallas, the Idaho Falls unit of Curtiss-Wright will be the US stocking facility for all RadICS system components for the Kirovohrad region company.
🔵US-owned Jabil Circuit Ukraine, Ltd. is building a second electronics assembly plant in Zakarpattia, 300 meters south of the main rail freight yard for trains to Slovakia. The new, 20,000 square meter plant will be five km south of Uzhgorod and adjacent to Jabil’s existing plant, a workplace for 2,300 people. The new plant is to employ 1,300 people assembling mobile phones, media players and computer equipment for export to the EU.
🔵Slovakian and Ukrainian officials want to speed east-west freight and passenger rail traffic by developing logistics terminals in Košice and Mukachevo and a joint customs and border control point in Chop, reports Railwaypro news site. At a bilateral meeting, Infrastructure Minister Volodmyr Omelyan cited Ukraine’s new double track tunnel through the Carpathians mountains, saying: “After the opening of the Beskidy rail tunnel, the transit though the territory of Ukraine and Slovakia can increase by several times.” Dana Meager, from Slovakia’s Finance Ministry, said: “The development of a logistics complex in Košice can turn Ukraine and Slovakia into a gate between Asia and Europe and into a one big logistics hub.”
🔵ActiveChat, a Kyiv-based chatbot software company, hit the top of sales charts last month at AppSumo, the Texas-based deals website for digitally distributed online services. ActiveChat sold 10,800 subscriptions during the last two weeks of January, making it the period’s bestselling Software as a Service, or SaaS. The previous record for a Ukrainian company was DepositPhotos, which sold 8,000 subscriptions on AppSumo. Believing in the future of voice-activated chatbots, Sergei Kostyukov, the company’s managing partner, is talking with potential American investors with a goal of increasing ActiveChat’s market cap 10-fold in the next three years.
Податок буде стягуватися тільки в разі виведення коштів в фіатні гроші або при купівлі товарів і послуг.
This is a pretty good deal. It’s what Germany does. The headline is unduly negative.
I highly recommend tuning in to UKRAINE BUSINESS NEWS:
Here’s a sampling of teasers from a recent morning update email:
🔵In the first year of the visa-free regime with the EU, border crossings by Ukrainians to the EU jumped by 15% to 20.3 million, reports Oleg Slobodyan, spokesman for Ukraine’s Border Guard Service. Almost one quarter of crossings were with the new biometric passports. In only 3% of the crossings – 555,000 – Ukrainians tested the new regime by entering the EU without a visa.
🔵Visa free has been accompanied by a dramatic surge in east-west travel links, the Infrastructure Ministry reports. The number of passengers taking trains to the EU exploded last year, increasing 5.5 times, to over 200,000. With trains often running at capacity, Ukrzaliznytsia is launching two new EU bound trains in coming months, one to Hungary and one to Romania. Since 2015, the number of EU cities served by flights on discount airlines from Ukraine has more than doubled, hitting 38. With Wizz Air adding new destinations this summer and Ryanair starting Ukraine service this fall, air traffic to the EU is to keep expanding.
🔵Behind the numbers, there is a marked psychological shift westward, argues the EU Mission to Kyiv. Ukrainians view visa-free travel as the main political event of 2017, according to a public opinion poll by the Ilko Kucheriv Democratic Initiatives Foundation and the Razumkov Center. Myslovo, the dictionary of modern Ukrainian language and slang, chose “visa-free” as the word of 2017. More than 575,000 people have visited the Open Europe information website which explains rules and opportunities for visa-free travel and terms of stay in the EU.
🔵Visa free is conditioned on Kyiv continuing to make free market changes and pushing through anti-corruption measures, Hugues Mingarelli, EU ambassador to Ukraine, reminded politicians Monday. He said: “While overall Ukrainian citizens are respecting the rules of the visa free regime, it is important that Ukraine continues the implementation of all benchmarks set out in their visa-liberalization process.”
🔵Norway’s Scatec Solar ASA plans to start building later this year two solar projects totaling 83 MW and costing EUR 85 million in Cherkasy region, about 200 km south of Kyiv. The EBRD is providing initial finance and Oslo-based Scatec is seeking additional equity investors. “We are very enthusiastic about securing our first two projects in Ukraine,” CEO Raymond Carlsen says in a press release. Looking to commissioning the two projects next year, he adds: “We see it as a first step to develop a larger portfolio of solar power plants in the country.”
🔵Talking to the Financial Times, Oksana Markarova, the new Acting Finance Minister, says she expects the IMF to allocate the next loan tranche to Ukraine this autumn. “Negotiations on gas tariffs and energy market reforms are now under way and we hope to conclude them soon and expect to get the IMF tranche in the autumn,” she told the London daily. “The faster we get it, the better . . it proves that we are progressing on our reform agenda [and is] a very good signal for investors.”
🔵Central bank head Yakiv Smoliy predicts that Ukraine will receive its fifth tranche of IMF money this fall. In an interview with Zn.ua, the Governor of the National Bank of Ukraine bases his confidence on last week’s passage of a law creating an anti-corruption court and progress ingas price talks. Expected to be around $1 billion, the IMF money would unlock additional macro-financial aid from the EU and the World Bank.
🔵The National Bank of Ukraine has filed lawsuits in Swiss and Ukrainian courts against Ihor Kolomoisky, seeking recovery of $385 million from five bad loans made by PrivatBank to Kolomoisky. Until the bank’s nationalization in 2016, Kolomoisky was the bank’s largest shareholder. Kolomoisky has launched lawsuits to challenge the nationalization.
🔵Integral-Bud, one of Kyiv’s largest apartment construction companies, plans to commission almost 50% more apartments this year, hitting 250,000 square meters, Hanna Layevska, the company’s commercial director tells Interfax-Ukraine. Depending on the size, this would be 5,000 new apartments. Last year, real estate professionals estimated that there were about 65,000 unsold new apartments in Kyiv and its suburbs.
🔵The Ukrainian Exchange has drawn up requirements for new software supporting exchange transactions, including clearing of derivatives. Last month, Ukraine’s government expanded its sanctions list, ordering all the Kyiv-based stock exchanges to replace their Russian-made trading software.
🔵A Chinese food safety team is in Ukraine until Friday, studying Ukraine’s cultivation, storage and packaging of sweet cherries. One of the world’s top 10 cherry growers, Ukraine produces 72,600 tons a year, about 10 cherries for each Chinese. With the list of food products approved for export to China growing, Ukraine sold $1 billion worth of food to China last year, 12 times higher the level of 2012.
🔵The average farm salary in Ukraine was $225 a month during the first quarter of 2018, 21.5% higher than the same time last year. With more and more farm labor migrating to Poland for temporary or full time jobs, farm wages are rising. The leading regions are in Western and Central Ukraine: Ivano-Frankivsk up 41%; Ternopil up 39%; Chernivtsi up 35%; Cherkasy up 35%; and Zhytomyr up 35%.
🔵In the latest industrial company to improve working conditions to dissuade workers from migrating to the EU, Zaporozhye Iron and Steel Works is investing $4 million to install air conditioners in work areas, cafeterias and bath rooms.
🔵Amadeus IT Group, the Spanish-based IT supplier to the hotel and airline industry, has opened in Kyiv its largest support center in Europe. Tasked with supporting Russian-speaking clients of the multinational giant, the Kyiv call center handles about 250 phone calls a day and numerous email queries, Interfax-Ukraine reports. Located in Podil, the center is open 14 hours a day, Monday to Saturday.
🔵Yanair started direct flights between Lviv and Batumi last Friday. On June 19, the Kyiv-based airline will increase frequencies to two times a week, Tuesdays and Fridays.
At 66 years old, factory owner and successful businesswoman Elizabeth Adeney is the oldest woman to have given birth in the UK. She became pregnant in 2009 after years of unsuccessful attempts via IVF. She had to travel to Ukraine to undergo another round of the $15,000 treatment due to her age; clinics in the UK do not treat women over 50.
The Biggest Tech Companies Are Already There
If you decide to open an office in Ukraine, you won’t be a pioneer. In fact, the Eastern European country already hosts teams from Boeing, Ericsson, Siemens, Oracle and Magento. Tech giants such as Snapchat, Opera Software and Wargaming operate offices in Ukraine as well.
The country also ranks among the world leaders in terms of outsourcing, holding the 24th position, according to the Global Services Location Index by A.T. Kearney. Moreover, 13 Ukrainian outsourcing companies made it into the world’s top 100 in 2017.
Hiring in Ukraine is what major brands are already doing. But not only that — Ukraine is home to a range of world-class product companies including Readdle, Grammarly, Jooble, Depositphotos, TemplateMonster, GitLab and others.
As Central European governments fight to block EU-mandated quotas of asylum seekers from Syria and Iraq, Ukraine has emerged as the region’s source of desirable guest workers.
Czech, Slovak, Hungarian, and Estonian governments have set up recruiting programs in Ukraine. Poland’s government is changing its laws to bring in more Ukrainians, adding to the 1.3 million who are already working there.
“CzechInvest and SlovakInvest opened offices here,” said Daniel Bilak, director of UkraineInvest, the nation’s new investment agency. “And they are not here looking for Ukrainian investments. They are looking for Ukrainian workers.”
On the pull side of the region’s push-pull equation, Central Europe is now Europe’s high-growth, low-unemployment zone.
Arber clothing (https://shop.arber.ua/) is my new favorite all-Ukrainian brand, together with Nova Poshta & Epi Center.
n 2015 potential real estate investors from overseas were largely pre-occupied with the war in eastern Ukraine and the ensuing financial crisis and falling hryvnia currency. In 2016, the chief concerns of foreign investors on Kyiv’s property market often revolve around Ukraine’s hard currency controls and ways to bring money into and out of the country.
Despite the imposition of tough currency controls, foreign investment in Kyiv’s promising residential real estate market is possible with proper planning and structure. In many cases, this will include obtaining qualified legal advice to help you structure your purchase. This article outlines basic strategies to legally bring hard currency into the country to purchase Ukrainian real estate. It also explores ways to expatriate rental income for properties owned by non-residents as well as expatriating the proceeds from property sales.