at the scheduled meeting of the National Bank of Ukraine’s Monetary Policy Board. According to the State Statistics Service inflation has climbed steadily recording these rates: December – 5%; January 6.1%; and 7.5% in February. The Central Bank has predicted that 2021 inflation will be 7%.
exceeding the Central Bank’s forecast of 7.6%, said a monthly Reuters poll of Ukrainian analysts. Analysts said consumer prices rose due to inflation imported from world commodity markets, notably wheat, corn, sunflower oil and crude oil. Oleksiy Blinov, Alfa-Bank Ukraine’s Head of Research, said: “These changes in external prices are directly and indirectly transmitted to consumer inflation in Ukraine.” The IMF has predicted that Ukraine’s consumer price index will end this year at 7.9%.
Ukraine should invest in achieving universal fluency in English among young people, Oleksiy Danilov, secretary of the National Security and Defense Council, said yesterday at a “Ukraine 30” forum on culture, media and tourism. “The English language should be used from kindergarten to the end of secondary schools,” Danilov said. “When the youth is fluent in English, that’s the precondition for the independence of this country.” In Scandinavian countries, about 60% of people under 35 are fluent in English. In the Netherlands, rate is 45%. In Germany, it is 38%.
The sale of Ukrposhta’s iconic postwar headquarters at 22 Kreschatyk Street, Kyiv will take two years, Ihor Smilyanskyi, director of the state postal system, said in a video. With Kyiv’s commercial real estate market soft, he said, now is a good time to start the obstacle course of permissions, audits, assessments leading up to a ProZorro auction. A buyer should be prepared to invest almost $4 million to upgrade the Stalin-era landmark. While the 1,000 employees will move with the headquarters, the building will retain Branch 01001, Kyiv’s Main Post Office.
The Cabinet of Ministers last night banned travel on buses and trains to and from four regions listed as ‘red zones’ for coronavirus infections: Chernivtsi, Ivano-Frankivsk, Zakarpattia and Zhytomyr. Car travel is permitted. If the number of red zone regions rises to more than half – or 13 of the 24 – Ukraine may have to reimpose a national lockdown, Health Minister Maksym Stepanov warned in an interview with strana.ua. He also said that March and April will be difficult due to the coronavirus. In Zakarpattia, the hospitalization rate is approaching one out of 1,000 inhabitants.
Stepanov yesterday berated the vaccination program he leads. In the two weeks since 500,000 vaccines arrived from India, 20,000 people have been vaccinated and 190,000 are on waiting lists. “I’m not satisfied with these numbers,” Stepanov said, criticizing his own campaign. “We were supposed to be vaccinating 10,000 people a day by the end of last week. Today, I’m interfering.”
The Health Ministry yesterday approved the use in Ukraine, Sinovac, the Chinese manufactured COVID-19 vaccine. Next week, 1.9 million doses are due to arrive in Ukraine.
Inflation spiked up to 7.5% yoy in February, a jump from the 6.1% yoy increase in January, reported the State Statistics Service. Last month, the biggest factor was a 45% yoy increase in price of natural gas. The recent price hikes in world oil prices will be reflected in March inflation. Last week, the National Bank of Ukraine got a jump on the inflation rise, hiking the prime interest rate to 6.5%, from 6%. The central bank predicted that inflation will peak this summer, then recede to around 5% yoy by December 2021.
Adamant Capital last night wrote of the inflation spike: “One of the reasons for this may be the sharp YoY increase in the money supply. Despite the fact that the NBU has already increased the key rate by 50bps to 6.5%, we expect the CPI to accelerate further in March to 8.0% YoY. Our end-of-year projection remains at 7.0%.”
The Finance Ministry managed to keep lowering rates for short term government bonds at yesterday’s weekly auction, the Ministry reported on Facebook. The all-hryvnia auction yielded the equivalent of $168 million, less than half the volume of last week. According to numbers posted on the Ministry’s website, short term bonds settled at these rates: 6-month, down 17 basis points, to 9.03%; 1-year bonds, down 5 basis points, to 10.62%; 1.5 year bonds down 8 basis points, to 10.96%. Staying unchanged were: 2-year bonds at 11.8% and 3-year bonds at 12.05%.
The Rada will soon vote on the final passage of the “Google” tax – a tax that would impose a 20% VAT tax on provision of Internet services by foreign companies to residents of Ukraine. The law, which could render $100 million in annual tax payments to Ukraine, would apply to such foreign tech giants as: Apple, Google, Microsoft, Netflix, Wargaming Group, Bloomberg, Alibaba, and Booking.com. “These are large foreign international companies operating and earning money in Ukraine. They receive a lot of income, but do not pay taxes in our country, Oleksandr Tkachenko, Culture and Information Policy Minister, wrote on Telegram. “Ukrainian technology companies pay VAT when providing electronic services to Ukrainians. But foreign companies – no.”
Services that would be taxed include: sale of images or texts, e-books; sale of audio, video, games, gambling; providing paid access to electronic resources; provision of cloud technologies for data placement; supply of software and updates to it; and, providing advertising services on the Internet.
Last week’s US entry ban on Ihor Kolomoisky and his immediate family “is the beginning,” Iuliia Mendel, spokeswoman for President Zelenskiy, said in an interview posted yesterday on the YouTube channel of Olesya Batsman, editor-in-chief of Gordon. Last week in an article for Atlantic Council, Mendel wrote that Zelensky is prepared to take on the oligarchs “everywhere from the energy and banking sectors to politics and the media.”
German Chancellor Angela Merkel will address the fourth Ukrainian-German Economic Forum, an investment and trade conference that will take place on line on Friday, March 19. According to Ukraine’s Embassy in Germany, experts will discuss: discuss industrial development and digitalization, energy and renewable energy, food and agriculture, and logistics and infrastructure. Registration can be made here, on the site of one of the organizers, the German-Ukrainian Chamber of Commerce, or AHK Ukraine.
Kyiv plans to receive 5 to 7 container trains a month from China this year, which is double last year’s rate, reported Ukrzaliznytsia. The trains take about 15 days to travel from China and are unloaded at the Kiev-Lyski logistics terminal on the Left Bank.
Poland’s PCC Intermodal S.A. plans to triple container trains between Poland and Ukraine, to three per week this year, according to the company’s website. Starting last year, the company picks up and delivers containers from Mostiska, the Lviv region border city where the European and Russian gauge rails meet. Across Ukraine, container traffic grew last year by 11% yoy, to 425,000 containers.