PrivatBank pays debt to Nikopol Ferroalloy Plant, but appeals court decision ordering the payment. The bank paid the plant $880,000 in line with a Dec. 17 ruling of the Kyiv Commercial Court, according to a PrivatBank press release. However, the bank says it considers the decision of the court of first instance to be unlawful. PrivatBank made the payment as employees of the Nikopol plant continue months of mass protests in front of the bank’s central office. The pickets are “another attempt at pressuring the bank” and aimed at “preventing normal activities of the bank,” PrivatBank said. Previously owned by oligarch Ihor Kolomoisky, PrivatBank was nationalized and recapitalized with state funds in 2016 after a $5.5 billion dollar hole was discovered in its ledgers. Before PrivatBank’s nationalization, the Nikopol plant acted as a guarantor on a refinancing loan that the National Bank of Ukraine (NBU) issued to the bank. The plant — which is also majority owned by Kolomoisky — settled its obligations before the NBU on Sept. 9, 2019, Inferfax-Ukraine reported.
Ukrzaliznytsia CEO Yevhen Kravtsov has officially resigned. Both the state railroad operator’s supervisory board and the Cabinet of Ministers accepted his resignation, as required. Kravtsov handed in his letter of resignation in December after facing intense criticism. Critics allege that change has come slowly to the railroad monopoly and corruption continues. In a Facebook post, Kravtsov wrote that the supervisory board had been satisfied with his work and there were “no formal grounds” for his firing, meaning that that company paid “requisite monetary compensation.”
Ex-Deputy Foreign Minister Olena Zerkal becomes advisor to Naftogaz CEO. In a press-release, the state gas company said she will be responsible for “international relations, as well as supporting the company’s position in international court and arbitration proceedings, particularly those regarding the assets of Naftogaz Group held by Russia” in Crimea, which Russia illegally annexed in 2014. Zerkal gained experience in oil and gas while participating in negotiations for transporting gas to Europe through Ukraine and in international meetings over Russia and Germany’s plans to construct the Nord Stream 2 pipeline, Novoye Vremya reported.
Nemiroff to import to top alcohol brands to Ukraine. The Ukrainian vodka company has inked a contract with Proximo Group to import and distribute the products of the Jose Cuervo, Bushmills, Kraken and Sexton brands in Ukraine. In this manner, Nemiroff plans to tap the market for imported alcohol while relying on its knowledge of the domestic market and its developed sales network. Nemiroff CEO Yuriy Sorochynskiy told Novoye Vremya that his company is “glad to use the experience and expertise” they have gathered as a producer in the role of importer.
Average salary in Ukraine grows to Hr 12,264 ($495), registering 16% annual growth. The State Statistics Service also reports that the average salary in December was 2.9 times higher than the minimal salary, which currently stands at Hr 4,173 ($168). The average salary in Kyiv, according to UNIAN, is Hr 18,869 ($762).
Economy Minister Tymofiy Mylovanov explains Ukraine’s recent decrease in industrial production. Newly released statistics indicate that the country’s industrial output fell by 1.8% last year. According to Mylovanov, Ukrainian metallurgy contributed the most to this decrease. It suffered due to insufficient international demand, trade restrictions imposed by Russia and insufficient volumes of lending, as well as high-interest rates.
Ukraine’s parliament will consider taxing non-resident firms providing electronic services at 20%. That bill was submitted to the Verkhovna Rada by lawmaker Danylo Hetmantsev, chairman of the parliamentary committee on finances, taxation and customs. It might target such international giants as Netflix, Google, YouTube and Facebook. The proposed tax would affect business-to-customer electronic services by foreigner providers. The bill’s explanatory note states that the current situation “results in losses for the state budget and creates a non-competitive environment for resident taxpayers. This violates the basic principles of equality and neutrality of taxation.”
Glovo delivery app starts operating in the city of Ivano-Frankivsk. The service is currently available in 14 Ukrainian cities, according to ain.ua. The company began operations in Ukraine in October 2018. Its couriers deliver up to nine kilos of food, groceries, medicine or other items at a time. Glovo says it will deliver anything in any city where it operates within an hour, while its average delivery time is 35 minutes.
EU and Ukraine agree to make nationalization of PrivatBank non-reversible. After the 6th Association Council meeting in Brussels, the parties “agreed on the importance of (the) irreversibility of reforms in the banking sector, in particular in relation to the nationalisation of PrivatBank,” reads their Jan. 28 joint press statement. Beyond confirming their common stance on the bank’s nationalization, they also stressed the “importance of bringing to justice those responsible for the large-scale fraud at Privatbank, and the recovery of assets.” The statement primarily refers to the former owners of the bank, oligarchs Ihor Kolomoisky and Gennadiy Boholyubov, who allegedly siphoned off more than $5.5 billion on the eve of the bank’s nationalization.
The National Bank of Ukraine (NBU) will appeal a decision of the Kyiv District Administrative Court, which cancelled the central bank’s fine of Industrialbank. In June 2019, it issued the fine for Hr 6.9 million due to the bank’s alleged involvement in high-risk activities. However, Industrialbank managed to have the fine cancelled in court, the NBU said in a statement. According to the central bank, the alleged risky activities and operations by Industrialbank “provided grounds to suspect that they could be connected, in particular, with legalizing criminal incomes and converting cashless funds into cash.” Industrialbank also failed to provide the NBU with sufficient information on its suspicious clients, the central bank said.
Horizon Capital will invest $7 million for a 6.8% stake in Purcari, a winery operating from Moldova. The Ukrainian private equity firm has already been a shareholder in Purcari. It purchased a stake in 2008 and sold it in 2018, earning 3.3 times more than the initial investment. Purcari Wineries was founded in 1827 and is now one of the major wine and brandy producers in central and eastern Europe. The company’s shares trade on the Bucharest stock exchange, and the company’s management is pursuing an aggressive market consolidation strategy.
