, the Russia-German gas pipeline that Russia built to bypass Ukraine. Ukraine’s Foreign Minister, Dmytro Kuleba, told Germany’s Welt newspaper that Ukraine “will consider” negotiations on compensation for loss of Gazprom transit fees due to the bypass pipeline. With compensation talk growing, he said: “The gas pipeline should be used as a lever to encourage Russia to play a constructive role in the peace process in eastern Ukraine.” In Washington, Vitrenko released a video saying that if the Biden Administration
In the last quarter of 2020, Ukraine’s economy returned to pre-crisis levels, the same level as in Q4 2019, he said. “We expect that last year’s GDP fell by only 4%,” Fiala said. “This is one of the best results in Europe. Only Poland fell a little less.”
Dragon Capital predicts Ukraine’s GDP will grow this year by 5.3%, Tomas Fiala, the investment bank’s CEO, said yesterday at the European Business Association. This would bring the GDP to $171 billion, “a figure comparable to 2013, although we have lost part of the country and part of the economy,” Fiala said, referring to Russia’s 2014 occupation of Crimea and half of the Donbas. Fiala, who also is EBA president, predicted the exchange rate will end this year where it
Facing default this July on a $1.5 billion loan from China, the management of Ukraine’s State Food and Grain Corporation has denounced that the British-American manager overpaid salaries during four months when he ran the state company last winter. On Monday, State Security Service agents served Simon Cherniavsky with papers from the State Fiscal Police charging him with embezzling the hryvnia equivalent of $321,000 in salaries paid to 18 outside staffers bought in to clean up the scandal-ridden state company.
“We identified several cases of systematic misappropriations of company funds and other gross mismanagement,” Cherniavsky wrote Wednesday in a letter to the US Embassy. In an email to the UBN yesterday, Cherniavsky called the charges against him “absurd.” Looking ahead, it is unclear how the Grain Corporation will account for hundreds of millions of dollars missing from the 2012 loan from Eximbank China, a borrowing guaranteed by Ukraine’s Finance Ministry.
China and Ukraine should compartmentalize their economic relationship, not allowing President Zelenskiy’s sanctions on Chinese companies investing in Motor Sich to poison wider bilateral trade and investment ties, argues Zhao Huirong, a guest writer in China Daily, owned by the Chinese Communist Party. “The sanctions are targeted only at the companies involved in the [aircraft engine] deal, not at those engaged in joint Sino-Ukrainian projects,” writes Zhao, an Eastern Europe research fellow at the Chinese Academy of Social Sciences. “Zelenskiy
Ukraine plans to launch the its latest remote sensing satellite, Sich 2-30, into Earth orbit by the end of this year, Strategic Industries Minister Oleh Urusky told a recent meeting of spacecraft developers and customers of satellite services. Built by Yuzmash, the first satellite of the Sich family was placed into orbit in 2004 from a rocket launched from Russia. Urusky did not say what company or country would handle the launching. Reporting on the satellite plan, China’s news agency
In the latest of three court setbacks for Ihor Kolomoisky, a 6-year, $6 billion claim by Kolomoisky and his partners against Ukraine ended yesterday after the Arbitration Institute of the Stockholm Chamber of Commerce declared it had no jurisdiction in the case. “SUPER MEGA WIN!!!!!!!!!!!! in Stockholm arbitration,” Ukraine’s Justice Minister Denys Maliuska wrote on Facebook. “After almost six years of trial, the arbitration was denied them today — denied completely.”
Separately, in London on Monday, an English judge ordered Kolomoisky and his business partner Gennadiy Bogolyubov to pay PrivatBank £1 million in addition to an existing court-ordered payment of £11 million. Two weeks ago, in Kyiv, the Court of Appeal rejected a lower court ruling in Kolomoisky’s defamation suit against Anders Aslund, the Swedish-American economist. Lawyers for Asters successfully argued the Aslund’s statements about Kolomoisky’s involvement in the $5.5 billion bankruptcy of PrivatBank were an exercise of protected free speech.
Defending his decision to close three pro-Kremlin TV channels, President Zelenskiy has met with managers of other major TV stations and with ambassadors of the G-7 nations. In both cases, the President said Russian state money funded the stations. “The President noted the sanctions decision was based on proof that the funding came from Russia and the targeted TV channels cooperated with terrorist organizations,” reported Zelenskiy’s website.
Zelenskiy acted as Russian President Putin planned more investment in Ukraine’s media, Mikheil Saakashvili, the former president of Georgia, wrote in an essay for the Kyiv Post: “Zelensky’s courage to stand up to Medvedchuk should be applauded.” “It is well-known that Putin had allocated one and a half billion dollars to Medvedchuk for his pro-Russia media hypnosis,” writes Saakashvili who chairs Ukraine’s National Reform Council. “And they were also planning to take over ICTV Holding.” Owned by Viktor Pinchuk, ICTV
The closing of the three stations was appealed yesterday to the Supreme Court. A Presidential decree cannot be stayed until a higher court, the High Administrative Court, hears the case. Viktor Medvedchuk, the reputed shadow owner of the stations, complained yesterday: “With one stroke of a pen, Zelenskiy threw out 1,500 journalists and other employees of the three stations into the street and deprived millions of people of the right to receive objective information.” Medvedchuk’s party, the Opposition Platform –
The Biden Administration is continuing the Trump administration’s opposition to Nord Stream 2, DPA, the German news agency, reports from Washington of the Russia-Germany gas line. “Nord Stream 2 and the second line of Turk Stream are designed to increase Russia’s leverage over our allies and partners, and they undermine transatlantic security,” Ned Price, the new State Department spokesman said Wednesday. If the pipeline is finished and commissioned, Price said, more sanctions are possible.
The government’s plan to cut gas prices by one third is sparking a flurry of meetings between the IMF representative and government ministers. “We had a constructive meeting with the IMF on gas prices,” Prime Minister Shmygal wrote yesterday evening on Telegram. “Our Government’s position: the gas market in Ukraine must work. Unfortunately, some market players continue to abuse the position that Ukrainians suffer from.”
Aware of the IMF’s core attachment to market prices for gas, acting Energy Minister Yuriy Vitrenko and Finance Minister Serhiy Marchenko also explained the government’s position to IMF representatives. “They are concerned that we are revising some of our earlier commitments,” Marchenko told NV Radio yesterday, referring to the IMF. There are no grounds, he added, “to say that we have already done something very bad.”
From London, Timothy Ash stressed the importance of market prices for a major source of Ukraine’s heat and electricity: “The move to market-based gas pricing in Ukraine has produced huge wins in recent years – it’s helped slash gas consumption from plus 70 bcm to less than 30 bcm, cutting the energy import bill from $12bn per annum, to perhaps $2-3bn, and also cut the quasi-fiscal deficit by 4-5% of GDP, given the huge subsidies previously given to Naftogaz. That
Spawning street protests in at least eight regional capitals, the spike in Ukraine’s gas prices stems from: cold weather, high prices in Europe, and a poorly implemented market opening that allows price gouging by suppliers. Ash again: “The Zelenskiy team will argue that this is not aimed as a major reversal in market-based energy pricing, but is a reaction to oligopoly pricing by a few bad actors in the industry. Essentially Naftogaz seems to be selling gas to consumers at
At stake is $2.9 billion of low interest loans remaining to be disbursed from the IMF’s $5 billion Stand-By Arrangement of last summer. The agreement is widely seen as a seal of approval for Ukraine’s economic policies, an approval that lowers Eurobond rates for Ukrainian borrowers and, ideally, gives a green light to foreign brick and mortar investors. While discussions behind closed doors in Kyiv have been heated, in Washington, IMF Spokesman Jerry Rice merely told reporters yesterday: “The first
Ukraine’s coal production fell by 7% last year, hitting 29 million tons, near the level of 1916, reports the Energy Ministry. Employment in coal mines is about 30,000 today – 6% the level of the end of the Soviet period. In the last 15 years, government subsidies to coal mines have been cut from $8 billion a year to less than $500 million a year today.
One year after the last-minute renegotiation of Ukraine’s gas transit deal with Gazprom, Naftogaz reports that the Russian state company paid its 2020 bill in full — $2.1 billion. Gazprom paid for shipping the total booked amount – 65 billion cubic meters. By year’s end, Gazprom had shipped only 86% of that amount — 55.8 bcm. This year through 2024, Gazprom is contracted to ship 40 bcm a year through Ukraine’s pipelines.
Today, the US State Department is expected to issue a report listing which European companies working on Nord Stream 2 will be subject to US sanctions, Reuters reports from Washington. In advance, Rambøll, Danish, a consulting engineering company, dropped out of the $11 billion Russia-Germany gas line project this week. The company had done environmental impact studies, reports Politiken, the Copenhagen newspaper. A few days earlier, Norway’s Det Norske Veritas GL, which was to certify the1,230 km pipeline upon completion, also
TIU Canada of Calgary is suing Nikopol Ferroalloy Plant for disconnecting the Canadians’ 10.5 MW solar plant last March, ostensibly because the Ferroalloy Plant did not want to pay green power rates. The trial started Wednesday in Kyiv Commercial Court with TIU charging that the shutdown has cost them €1.5 million over the last 10 months. The solar plant connects to a substation on the grounds of the Ferroalloy Plant, which is owned by Igor Kolomoisky, Gennadiy Bogolyubov, and Viktor
Western Ukraine Coal Construction, Ukraine’s last state company devoted to building coal mines, goes up for auction in 10 days, reports the State Property Fund. The company has 15,700 square meters at its headquarters in Chervonograd, Lviv region and nine hectares at a miners’ resort in Volyn’s lake region. Bids start at $400,000.
The State Property Fund plans to sell 500 state properties this year to private owners, Dmytro Sennychenko, the head of the Fund, wrote on Facebook. “Privatization grows jobs, improves the socio-economic state of the regions, and the state ceases to spend taxpayers’ funds on damages,” he wrote. Obstacles include: the need to follow 70 procedures for each property sale, “sabotage by enterprise management or its ′shadow ′ executives,” and the lack of final Rada approval to lift last year’s suspension
Regional airports are primed for a post pandemic takeoff. UkSATSE traffic numbers for 2020 confirmed the dominance of Kyiv’s two big airports – Boryspil (47,524 flights) and Sikorsky (12,805). The air traffic control agency’s graphic on Facebook shows a second layer that is catching up with Sikorsky: Lviv (9,850), Odesa (9,282), and Kharkiv (7,576). A third layer shows potential: Dnipro (4,174), Poltava (4,119) and Zaporizhia (4,087). This winter, Dnipro starts a 3-year, $100 million rebuild of its runway and terminal.
The EBRD is working with the Infrastructure Ministry to create dedicated funds to develop Ukraine’s airports and railway infrastructure, Minister Vladyslav Krykliy said yesterday on the ministry website. In an attempt to emulate the Road Fund, “the EBRD has already allocated funding and selected consultants to analyze international experience, develop a concept and write relevant legislation,” Krikliy said. The EBRD also gave the Minister a report yesterday assessing the ministry’s capacity to execute public partnerships with private companies.