Ukrainian President Volodymyr Zelensky speaks at the World Economic Forum in Davos, Switzerland. During his speech, Zelensky pledged to make Ukraine an economic leader in the central and eastern European region. He called on the audience to invest more money in Ukraine. “We propose all of you to be the shareholders of the success of new Ukraine,” Zelensky said. He also outlined a proposal for a government “investment nanny” to look after big investors. Read the Kyiv Post’s coverage of Zelensky’s speech.
Zelensky meets with International Monetary Fund Managing Director Kristalina Georgieva in Davos. After the meeting, he said they had a “good conversation and discussion about the very important support of IMF for Ukraine.” Georgieva confirmed that the meeting was productive and said that the international donor recognizes Ukraine’s progress in court reform to promote the rule of law and in advancing economic reforms. Ukraine needs to complete these reform steps in order for the IMF’s board of directors to consider another three-year financing program for the country, she said.
Zelensky and Cargill CEO David MacLennan discuss reforming Ukraine’s railway system, creating a land market and attracting investment. Zelensky stressed that Ukraine wants more investments from Cargill — which has invested more than $500 million in the country — and is ready to compete for each investor and investment project. “We will be happy to cooperate with Cargill Financial to launch instruments to provide loans for farmers to increase their harvests and acquire new agricultural equipment,” Zelensky said. MacLennan praised Ukraine’s movement towards transparency and its policies on investment, according to the president’s press service.
Supreme Court limits the National Bank of Ukraine’s ability to recoup losses from 2016 PrivatBank nationalization. In its Jan. 22 ruling, the court declined to cancel a lower economic court’s ruling. The earlier ruling stated that the NBU cannot collect on a land plot in Odesa Oblast for which the company Hadjibei had a mortgage. That company is connected to PrivatBank’s former co-owner, oligarch Ihor Kolomoisky, and provided collateral in order for PrivatBank to receive a refinancing loan prior to nationalization. The economic court ruling states that the NBU can only collect on the collateral property if it cannot claim the loan from PrivatBank. In practice, this means the NBU cannot claim collateral provided for refinancing loans. The NBU believes this ruling violates the law and that it has the right to be repaid as it chooses, Novoye Vremya reported. PrivatBank was nationalized in 2016 and recapitalized with state funds after a $5.5-billion was discovered in its ledgers. This ruling could allow Kolomoisky to escape accountability, an NBU official told the news outlet.
Naftogaz’s executive board has received three new top managers, the state energy company said in a statement. Its supervisory board appointed to the executive board:
- Peter van Driel as a chief financial officer. He formerly served as vice president for accounting and reporting at Shell, where he worked for over 22 years.
- Otto Waterlander as chief transformation officer. He previously was a senior partner at management consulting firm McKinsey & Company.
- Yaroslav Teklyuk as chief legal officer. He previously was Naftogaz’s director for legal and governmental affairs.
Naftogaz also removed two people from the board: Yuriy Kolbushkin, a long-standing member of the board, and Mykola Havrylenko, the general director of state gas pipeline operator UkrTransNafta, a Naftogaz subsidiary.
Naftogaz has also approved a new version of UkrTransNafta’s statute. The new document eliminates its collegial executive directorate and replaces it with a single general director, the UNIAN news agency reported citing a press release.
Ukrtransnafta gets 4.3 million euros compensation from Russia’s Transneft. From May 2019 to January 2020, the Ukrainian oil pipeline company received the money in compensation from its Russian counterpart after receiving oil contaminated with organochloride last year, Interfax-Ukraine reported.
Ukraine has used up its honey export quota to the European Union in 2020. Ukrainian firms have already exported 6,000 tons of honey to the EU, state media covering European integration reported. The quotas allow Ukrainians to sell their products to the EU with reduced or no customs duty fees. When quotas expire, traders start paying full fees. Other popular tariff quotas among Ukrainian exporters cover malt and wheat gluten (72% of these quotas for 2020 have already been used), grape and apple juices (67% used), sugar (28% used), poultry meat and semi-finished poultry meat (25% used) and eggs and albumin (20% used).
Ukraine wants to add barcodes to excise stamps instead of introducing electronic excise stamps, Cabinet Minister Dymtro Dulilet wrote on Facebook. Paper excise stamps confirm that an alcohol producer has paid tax on their production, but are easily counterfeited. Electronic stamps have long been offered as a solution to this problem, but they would require all businesses selling alcohol to be equipped with special scanners. Barcodes require neither additional scanners, nor a separate IT system. They can also easily be activated and deactivated. Currently, 50% of alcohol in Ukraine is sold illegally, risking the health of consumers and costing the state $205,000–$410,000 a year.
Nova Poshta replaces the head of its supervisory board. The Ukrainian leader in the express delivery market elected Volodymyr Savchuk to the position for one year after the previous head’s contract expired, Interfax-Ukraine reported. Savchuk is a professor at the Kyiv Mohyla Business School and an expert in strategic , financial and investment management, Nova Poshta said in a 2018 statement when Savchuk first joined the board. The company also said it plans to invest $100 million in infrastructure development in 2020.
Inside Davos. Ukraine offers a compelling investment opportunity, writes Lenna Koszarny, a founding partner of the Horizon Capital private equity firm, on the sidelines of Davos. “If Ukraine gets it right, the country may very well emulate the post-reform economic rebound story of Columbia – growing 13% annually for 10 years from 2004; Philippines – growing 9% per annum from 2001-2014; Slovakia – surging 17% annually from 2000-2014, and other success stories, driven by focusing on structural reforms, attracting considerable FDI and substantially growing exports.” Read more.
