Ukraine

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Journal

8:35 AM Friday, December 15, 2017
UBJ.am
UBJ AM Sept. 21, 2017
​Radisson, Marriott and Accor to open new hotels in Kyiv this fall; Naftogaz sues Russia for $5 billion over Crimea seizures; Groysman vows to continue Naftogaz modernization; Britain and Ukraine should start talking about a post-Brexit trade deal;
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

• Higher hotel occupancy rates are emboldening three international hotel chains to open in Kyiv three new hotels with a total of 664 rooms. By the end of this year, Radisson is to open Park Inn with 192 rooms, Accor is to open Mercure Congress Kiev with 160 rooms, and Marriott/Starwood is to open Aloft Kiev with 312 rooms. A survey by JLL Hotels and Hospitality Group indicates that that occupancy rate for Kyiv’s high end hotels was 46% percent in June, up from 37 percent for June of last year.

• Naftogaz is suing Russia in a $5 billion claim over Crimea assets seized in 2014. Ukraine’s state gas company filed the claim at the Permanent Court of Arbitration in the Hague. Naftogaz has hired Covington & Burling, the US law firm that also worked for Yukos investors on the $60b case against Russia. A court ruling is scheduled for end of 2018. According to Naftogaz, seven claims have been afiled against Russia’s expropriation of assets in Crimea, including claims of Privatbank, Oschadbank, Ukrnafta and businessman Igor Kolomoisky. Concorde Capital’s Alexander Paraschiy writes: “We expect most of claims of Ukrainian entities will be successful, though the timing of court decisions is rather far off.”

• Naftogaz CEO Andriy Kobolyev sees ‘huge risks’ after foreign board members quit. Kobolyev, who plans to stay on, sees threats to efforts boost domestic gas output, to borrow from foreign banks and to unbundle gas transit from distribution.

• Responding to the resignations, Prime Minister Volodymyr Groysman told the Cabinet Wednesday: "I guarantee that the reforms will be continued and sped up." Groysman said he is committed to modernizing Naftogaz, including by "unbundling" its production, transport and sales businesses. The US and British embassies called for the prompt appointment of a new, professional and independent board for the state gas company.

• Naftogaz CEO Kobolyev plans to make a tender in January to attract a European partner to manage its gas transportation system, GTS. Kobolev told ICTV the business of transit pipelines should be separated from the business of gas storage in underground reservoirs.

• Deputy Finance Minister Yuri Butsa details on his Facebook page Monday’s $3 billion Eurobond deal: "The final placement took place among about 300 investors, of which 78% are asset managers, and 15% are hedge funds. 46% of the investors are from the United States, 36% are United Kingdom, 16% are Continental Europe." He added that the peak amount of applications was $ 9.5 billion from about 350 investors.

• Dragon Capital is predicting that Ukraine’s next IMF tranche, for as much as $1.9 billion, will be delayed until the first half of next year. The investment bank says the 2019 elections will limit access to new funding, but favorable global markets may enable Ukraine to get through
elections without IMF support

• Beijing’s official China Daily newspaper has published a lengthy article presenting as a done deal the collaboration between Ukraine’s Motor Sich and Beijing Skyrizon Aviation Industry Investment Co. to design and produce aircraft engines at a massive new industrial park in Chongqing. Last week, Ukraine’s security service, the SBU, filed a motion in Kyiv court to freeze the deal, arguing it damages national interests. China’s English language newspaper made no mention of the legal freeze on the Ukrainian side.

• Looking beyond Brexit, Britain and Ukraine should negotiated a bilateral free trade agreement, Alan Duncan, Minister for Europe and the Americas at the Britain’s Foreign Office, told Yevropeiska Pravda. Duncan, an MP who was here for the YES conference said that Britain cannot hold formal FTA talks before it leaves the EU, so only informal consultations are possible so far. He said: “Nothing prevents us from starting an informal dialogue with Ukraine and coming to an agreement.”

• The Cabinet has approved developing e-governance in Ukraine through 2020. Prime Minister Groysman said: "Now we provide 30 electronic services. By the end of the year, we will provide 100 services. In addition, we will introduce mobile identification by the year-end. This step means that e-signature will allow making use of even wider range of services."


For comments and story ideas, please email UBJ Editor in Chief James Brooke at james.brooke@theubj.com

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