Bank deposits increase among Ukrainians
Dragon Capital says that July was a good month for Ukraine’s embattled banks. Ukrainians increased their total deposits by almost 2 percent, raising the amount of hryvnia in personal deposits in the banking system by Hr 3.5 billion ($140 million), suggesting that some of the loss in trust sparked by the dozens of insolvent banks may be beginning to abate. Corporate accounting also got a lift, with an influx of Hr 3 billion ($120 million) from companies. Dragon Capital also said that bank offerings of interest rates on household deposits went down to 15.7 percent, with “the central bank pre-announcing further rate cuts conditional on the IMF program going back on track,” the investment bank wrote.
Interpipe sells pipes worth Hr 565 million Ukrainian steel pipe and wheel manufacturer Interpipe sold half a billion hryvnias’ worth ($23 million) of pipes to Ukraine’s state-owned gas extraction company, Ukrgazvidobuvannya. That’s according to Prozorro, the new online procurement system for state institutions, the use of which for state procurement became obligatory as of Aug. 1.
Ukrgazvidobuvannya, a daughter company of Naftogaz Ukraine, the state-owned oil and gas company, is the biggest gas extractor in the country. It extracts around 75 percent of the country’s gas.
Interpipe, owned by Victor Pinchuk, has seen a slump in demand due to low global steel and oil prices. Pipe production at the Interpipe Niko Trub factory, for instance, witnessed a 29 percent drop in production compared with the same period in 2015, according to the company’s operations reports from January to March. Likewise, Interpipe Novomoskovsky Trubniy Zavod’s production fell by 24 percent.
Price set for Kharkiv electricity utility
The Ukrainian government set the price for the auction of a majority stake in Kharkiv’s regional electric utility at $73 million this week. The privatization of a 65 percent stake of one of the country’s largest power distributors comes amid a wider attempt by the government to sell off key assets, mostly in the energy area, as they are seen to be a drain on the state budget and source of corruption. Since the 2014 EuroMaidan Revolution, not a single sale has gone through without attempts being made by the country’s oligarchs to block them. The Kharkiv sale is part of a larger attempt at privatizing the country’s regional energy utilities – an effort that, if successful, could earn revenues of up to $250 million, according to Dragon Capital analyst Denis Sakva. “The company is more likely to be privatized by one of local business groups active in the power sector,” Sakva added in a research note.
Westinghouse to build nuclear fuel plant
Westinghouse manufacturing company is increasing its supplies of nuclear fuel and plans to build a nuclear fuel plant in Ukraine. This will reduce Ukraine’s reliance on Russia, Energy and Coal Industry Minister Ihor Nasalyk said on Aug. 4.
Before Ukraine started buying nuclear fuel from Westinghouse in 2015, Russia supplied around 95 percent of the fuel for the four nuclear power plants operating in Ukraine. Since February, Westinghouse supplies a third of the fuel and plans to increase that share.
According to the minister, the construction will be financed with $260 million loan from a U.S. bank, while the rest will be covered by tariff revenues from state energy generating company Energoatom.
Ukrzaliznytsia to build railway in Iran
State railway monopoly Ukrzaliznytsia plans to sign a contract with the Iranian Infrastructure Ministry to build a railway in Iran. Ukrzaliznytsia plans to engage 100 workers to build around 300 kilometers of track.
According to Ukrzaliznytsia CEO Wojciech Balczun, such cooperation will bring in income, as well as establish a reputation for Ukrzaliznytsia as a company that has ambitious plans to develop international transport corridors.
Today, Iran is constructing around 5,000 kilometers of new railway and plans to expand this by another 4,000 kilometers. “We expect to get our share of this market,” Balczun said on Aug. 9. “For (Ukrzaliznytsia), it is essential to take an active part in building a caravan route between the East and West on Iranian territory.”
