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UBJ AM News: Feb. 15, 2017
Ukraine's shadow economy has been reduced, the spring planting is being held up, and growth in 2016 covered all major sectors.
image/svg+xml Kyiv Lutsk Rivne Zhytomyr Lviv Ternopil Khmelnytskyi Uzhgorod Chernivtsi Vinnytsia Chernigiv Sumy Kharkiv Poltava Cherkasy Kirovohrad Lugansk Dnipropetrovsk Donetsk Zaporizhzhia Mykolaiv Odesa Kherson Simferopol Sevastopol Ivano- Frankivsk

Efforts to curb the shadow economy are paying off, with a 5 percentage point reduction in 2016. Preliminary calculations by the Economic Development Ministry peg the value of the shadow economy at 35 percent of official GDP.

Crop seed in Ukraine has not been certified since December 2016, and that is threatening the spring planting, executive director of the Ukrainian Agribusiness Club Oleksandr Zhemoida said at a press conference in Kyiv on Tuesday, according to Interfax Ukraine.

Ukrnafta is in talks about new contracts for joint well-drilling and renewal of the drilling fleet, CEO Mark Rollins said, Interfax Ukraine reported. "Now we are negotiating with several potential partners... Joint activities are the only option for attracting investment outside the company," he said. Rollins also said that as part of its investment campaign in 2017, Ukrnafta plans to drill four new wells, establish a number of new electric pumps and exploit fracking possibilities.

Prime Minister Volodymyr Groysman said 2016 was a year of economic recovery, and industry, the construction sector and agriculture showed the best growth rates. "I would like to emphasize that 2016 marked the resumption of growth in the Ukrainian economy. We observed progress in all economic sectors," Groysman said.

The National Bank of Ukraine examined the country's 60 largest banks, which account for 98 percent of the assets of the Ukrainian banking system, and concluded that 39 banks needed recapitalization, multiple sources reported.

At a meeting Tuesday, the Cabinet approved guarantees for a $150 million loan issued by the International Bank for Reconstruction and Development to Ukreximbank, Interfax Ukraine reported.

The government is working on new tax breaks and concessions for purchasers of electric vehicles, Novoe Vremya reported. The planned incentives could knock up to 21 percent of f the price of a new electric vehicle. Ukraine has a goal of making 15 percent of automobiles on the road electric ones within three years.

The European Bank for Reconstruction and Development established a company in Ukraine to manufacture train cars, Crea I UA, and instantly became one of the five leading private owners in that market, multiple sources reported.

The growth of Ukraine's GDP in the fourth quarter of 2016 accelerated to 4.7 percent, which compares with 2 percent growth in the third quarter, according to the State Statistics Service. For the entire year, Ukraine had 2.2 percent GDP growth, which exceeded most analysts' expectations.

The ProZorro procurement system has saved Ukraine $292 million thanks to the transparency it has provided in the tender process, Ukrinform reported.

For comments and news tips, please email UBJ AM editor David Edwards at david.edwards@theubj.com.

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