Category Archives: Business & Prices

Ukraine Business News

I highly recommend tuning in to UKRAINE BUSINESS NEWS:

https://www.ubn.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.

Ukraine a center for fertility treatment?

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.

http://memebrity.com/top-10-worlds-oldest-mothers-given-birth/6/

Why R&D in Ukraine is a great idea

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.

https://www.forbes.com/sites/forbestechcouncil/2017/09/07/why-building-rd-in-ukraine-is-a-great-idea/

Ukrainian workers in high demand in Eastern Europe

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.

http://www.atlanticcouncil.org/blogs/ukrainealert/ukrainians-stock-soars-in-central-europe-as-employers-vie-for-labor

UKRAINIAN REAL ESTATE: Investor guide to cross-border property financial transfers

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.

http://bunews.com.ua/investment/item/ukrainian-real-estate-investor-guide-to-cross-border-property-financial-transfers

Fintech startup born in Ukraine, raised in Singapore closes $2m series A round

Turnkey Lender – a software-as-a-service (SaaS) fintech startup – recently closed a series A funding round worth US$2 million. Vertex Ventures was the only participant in the capital raise.

This is the company’s first institutional funding round. It had previously secured seed funding from SMRK VC Fund.

Turnkey Lender gives financial services providers a cloud-based solution for managing the loans that they give to their clients and customers. It uses machine learning technology to analyze and assess loan applicants.

https://www.techinasia.com/turnkey-lender-series-a

Why American Farmers Are Hacking Their Tractors With Ukrainian Firmware

To avoid the draconian locks that John Deere puts on the tractors they buy, farmers throughout America’s heartland have started hacking their equipment with firmware that’s cracked in Eastern Europe and traded on invite-only, paid online forums.

Tractor hacking is growing increasingly popular because John Deere and other manufacturers have made it impossible to perform “unauthorized” repair on farm equipment, which farmers see as an attack on their sovereignty and quite possibly an existential threat to their livelihood if their tractor breaks at an inopportune time.

https://motherboard.vice.com/en_us/article/why-american-farmers-are-hacking-their-tractors-with-ukrainian-firmware

Grammarly, With $110 Million, Brings Artificial Intelligence to Writing

Founders Max Lytvyn, Alex Shevchenko are Ukrainain.

One of the most basic human activities, writing, is getting an assist from machines.

Startup Grammarly uses machine learning and artificial intelligence to help improve people’s writing, from basic spelling, grammar and style to more advanced suggestions on tone and context-specific language.

The San Francisco company has been bootstrapped since its founding in 2009 but has now raised $110 million in its first institutional funding as it looks to expand and ramp up hiring. General Catalyst led the growth equity round with participation from Breyer Capital, IVP, SignalFire and Spark Capital.

The 110-person startup has grown rapidly since it became a free service two years ago—it now has 6.9 million daily active users and has been profitable since early on, according to the company. The app has 18,000 reviews and more than 10 million downloads on the Chrome Web Store.

https://www.wsj.com/articles/grammarly-with-110-million-brings-artificial-intelligence-to-writing-1494243003

Report: Ukrainian IT industry employs 100,000 people

The Ukrainian IT industry now employs 99,940 people — up from 89,300 last year — according to the latest report of DOU.UA, an authoritative industry resource. The figure includes programmers, QA specialists, project managers and other IT-related professionals.

Almost half of these professionals live in Kyiv (Kiev). Others are inhabitants of such other major Ukrainian cities as Kharkiv (Kharkov), Lviv (Lvov), Dnipro (previoulsy known as Dnipropetrovsk), and Odessa.

With its Ukrainian offices in Kyiv, Dnipro, Lviv, Kharkiv and Vinnytsia, US-headquartered EPAM is the biggest employer in the industry. Among other industry leaders are such companies as SoftServe, Luxoft, GlobalLogic and Ciklum, if judging by the number of employees, says the report.

With monthly salaries reaching or exceeding $3,000 for certain specialties, remunerations in the Ukrainian IT sector are high or very high by local standards.

Women are becoming more interested in the field. This year the share of female specialists now reaches 15%, up two percentage points from last year.

http://www.uadn.net/2016/11/23/report-ukrainian-it-industry-employs-100000-people/

IT investors call on government to ease tech companies’ path to growth

Prominent Ukrainian capital investors and business angels discussed their algorithms for investing in Ukraine’s tech industry at the Lviv IT Arena conference on Oct. 1.

And all agreed that the process of investing, either in big tech companies or small startups, could be made simpler and easier if the government did its part by passing better laws and improving the economy.

https://www.kyivpost.com/technology/investors-call-government-ease-tech-companies-path-growth.html

Ukraine Plans to Make Military Attack Drones

Visit www.theubj.com for more great stories!

#ukraine #drones #manufacturing
By Igor Kossov
KYIV — Ukraine plans to test locally-made military attack drones next year, according to President Petro Poroshenko and state defense giant Ukroboronprom.
Poroshenko called for “new, modern weapons to defend against the aggressor,” in a speech last week in Kharkiv. To that end, he said that a priority is to develop cruise missiles and attack drones.

Earlier, Ukroboronprom general director Roman Romanov told Poroshenko-owned Channel 5 TV station that armed UAVs are in development by state aircraft developer Antonov, a part of Ukroboronprom.

“This UAV model that we are making now at Antonov will be tested soon, I want to say next year,” said Romanov. “It’s designed to carry weapons, rockets.”

UKRAINE’S BIG DEFENSE INDUSTRY

Ukraine was the world’s 12th largest arms exporter in 2015, according to the Stockholm International Peace Research Institute.
Multiple requests for comment to Ukroboronprom and Antonov were not returned last week.

Talk of developing military drones had been circulating since the start of the conflict with Russia in 2014. Several light drone models, designed for recon and artillery targeting were designed by volunteer civilian engineer groups such as PeoplesProject and Army SOS.

Alexander Turchinov, the National Security and Defense Council Secretary, stated earlier this year that Ukraine’s military has a “huge demand for combat UAVs” and that production will be prioritized by Antonov.

Ukroboronprom unveiled the design of its first UAV in July 2015 and showcased the completed model in February. The BpAK-MP-1 Spectator, built by Ukroboronprom subsidiary Meridian and a team from Kyiv Technical University, is a light fixed wing recon drone that can be launched by hand and can carry an electronics suite with a mass of up to 1.5 kilograms.

JOINT VENTURE WITH POLAND

Future UAVs, possibly including the much larger attack drones, will have help from Poland. Ukroboronprom signed a memorandum of understanding with Polish developer WB Electronics SA in 2015. Among the MOU’s provisions was an agreement to cooperate on UAV production.

According to Ukroboron deputy director Arthur Kheruvymov’s comments to the media last year, combat drones may be part of the agreement. He mentioned that WB Electronics will help develop a machine with a 14-meter wing span that can find and destroy targets.

The MOU was broadened this year in September. In public, the Polish and Ukrainian sides were vague about what new agreements were reached.

Three separate drone developers at this year’s thirteenth annual International Arms Exhibit in Kyiv said that despite strong pro-UAV statements by military and Ukroboronprom officials, they have not seen real demand for their products this year. As a result, they are turning to the more lucrative civilian agricultural sector.

With reporting from UBJ Kharkiv Correspondent, Kate Sukhopleshchenko — kate.sukhopleshchenko@theubj.com

For comments and news tips, please email UBJ Defense Correspondent Igor Kossov at igor.kossov@the ubj.com.

Photo: Poland’s WB Electronics displays its Fly Eye reconnaissance drones on its website. WB Electronics made a deal with Ukroboronprom to help it develop unmanned aerial vehicles. (supplied)