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Monday, May 20

Zelenskiy: Pro Business…Poroshenko Hails Jump in EU Trade and Travel…5G Mobile to Start Next Year…First Tenders for Public-Private Partnerships by June…Nord Stream 2 Admits Delay to 2020

By James Brooke

🔵With Volodymyr Zelenskiy to be inaugurated this morning at the Rada, cautious praise comes from one observer of Ukrainian leaders for the last 30 years. “He is pro business, pro market, and pro Western,” writes Timothy Ash, senior sovereign analyst for Blue Bay Asset Management in London. Drawing on interviews in Kyiv last week, he writes: “The consensus from those that have had any interaction with the President-elect is that he is clever, business-savvy, a quick learner, that he genuinely has the good of the country at heart and does want to deliver change, which is really what his electorate voted for. He is a joker, but certainly no fool.”

🔵While predicting that Zelenskiy will succeed in dissolving the Rada and holding parliamentary elections this summer, Ash said the major threat to the new government will be efforts by Igor Kolomoisky, Zelenskiy’s main media backer, to win back PrivatBank. While some in Kyiv say “Zelensky is his own man, knows the issues and problems and will box off Kolomoisky,” Ash writes, “his presidency will likely stand or fall on this very issue.” Given the question mark hanging over PrivatBank, the IMF is unlikely to disburse the second tranche, $1.3 billion, until this fall, Ash writes in his widely circulated email.

🔵In parting public comments, President Poroshenko said Saturday that he is proud that Ukraine’s trade with the EU has more than doubled since the free trade zone went into effect on Jan. 1, 2016. Speaking on Europe Day, he also said that 2 million Ukrainians have traveled to the EU since the new 90-day visa-free regime started June 11, 2017. “More and more flights are opening, airports and terminals that have not worked for years have reopened,” he said. “I am proud that during the period of my presidency, Ukraine and the EU have become closer than ever before in history.”

🔵5G mobile service should start next year in Ukraine, according to a decree signed Friday by President Poroshenko. The decree sets a schedule for releasing the necessary frequencies. Separately, Oleksandr Zhyvotovsky, head of the National Commission for Communications Regulation, writes on Facebook that this work will be done by fall. The Rada will have to pass implementing legislation.

🔵Given Ukrainians’ low cell phone bills, construction of 5G would take “decades” to pay off, warns Oleksandr Kohut, director of regulator support for Kyivstar, the nation’s biggest mobile phone company. “Implementation of 5G could require the purchase of a large number of frequencies, the costs of which, given the subscriber’s low mobile check and investment risks, could be paid back in decades,” he tells Interfax-Ukraine. “It is necessary to create conditions for improving the country’s economy, reducing tax pressure on the industry and adapting it to European regulatory practices.”

🔵One year after the launch of 4G, about half of Ukrainians have access to the fast service, according to separate reports from the nation’s two largest mobile phone companies, Kyivstar and Vodaphone. Kyivstar, which has 26.4 million subscribers of all levels of service, plans to invest about $110 million a year through 2022 to expand 4G service, Alexander Komarov, company president, told reporters recently. By comparison, Vodaphone has about 20 million subscribers of all service levels.