23:38 PM Saturday, November 17, 2018 Friday, July 13
Moody’s upgrade Ukrainian banking; Nibulon secures $80m loan; Naftogaz pays UAH 72 billion in taxes; Household gas price to rise 18%; 12 bid for Lviv recycling plant; Steel, eggs & sugar up, milk & meat down.
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Moody’s upgrades Ukrainian banking outlook to positive.Moody’s investor service has upgraded it outlook on the Ukraine banking system from stable to positive in recognition of a decline in bad loan write offs over the next 2 years.Their expectation is that the country’s banks will improve their cumulative creditworthiness within the next 12-18 months facilitated by better asset quality and a return to profit-making operations, the agency’s official website reports. “The Ukrainian economy is expected to keep gradually recovering, which would in turn stimulate credit demand, while simultaneously improving borrowers’ capacity to pay back their loans,” explained Lev Dorf, an analyst at Moody’s Investors Service. The agency sums up its report with a forecast that the Ukrainian banking system will go back into profit this year after four straight years of losses. Despite the fact that around 75% of Ukrainian banks made profits in 2017, the banking sector as a whole made a net loss last year.

Nibulon secures $80 million loan from European banks. Nibulon, one of Ukraine’s larget grain traders has secure an $80million from ING Bank NV, a syndicate of European commercial banks and the European Bank for Reconstruction and Development in a syndicated loan, HB-Business reports. The Ukrainian agri-giant plans to invest the funds in the financing of working capital related to the purchase of products

NBU lowers growth forecast for 2019 to 2.5%. The National Bank of Ukraine now predict a slow down to 2.5% despite predicting 2.9% growth very recently.This prediction falls in line with that made by Raiffeisen Bank Aval late last week but is at odds with the Ministry of Economic Development and Trade who early this week were projecting 3% growth in 2019.The NBU cites the change as due to the waning effects of higher social standards, the tight monetary conditions required to bring inflation back to its target, as well as tight fiscal policy resulting from the need to repay large volumes of public debt it said in a statement. The forecast for GDP growth for 2018 and 2020 remained unchanged at 3.4% and 2.9%, respectively. Meanwhile, they suggest that investment growth will be restrained by businesses' higher labour costs. However, the contribution of net exports will remain negative over the forecast horizon, as imports will satisfy a significant portion of domestic demand and capital investment. Source: Interfax Ukraine

Naftogaz companies pay UAH 72 bln to the State budget in H1 2018. The Naftogaz Group accounted for 17.7% of total revenue of the national budget in the first six months of 2018, its press service announced.In 2017 the Group paid UAH 107.3 billion in taxes and dividends to the budget. Naftogaz Ukrainy is a monopolist that unites the largest oil and gas producers of the country in the transit and storage of natural gas, as well as transportation of crude oil by pipeline throughout the country.

Household gas price to hikes 18% this year. The Ministry of Economic Development and Trade has forecasted an increase of 18% y-o-y in the marginal retail gas prices for households in 2018.Interfax Ukraine reports that the figures are mentioned in a draft government decree on the forecast of social and economic development for 2019-2021.The document is reported to say that the price of gas for the population may increase by 5-8% in 2019 and by 14% in 2020, but it will remain unchanged in 2021. Retail power rates for households will not change in 2018 y-o-y but they are expected to grow by 25% annually in 2019-2021. According to the Ministry's estimates, retail power rates for industrial enterprises in 2018 will increase by 16%, and further by 10% every year in 2019-2021.

12 international companies bid to build Lviv waste recycling plant. 12 companies from 11 countries have submitted bids for the construction of a waste recycling plant in Lviv all of whom represent the most extensive experience in the construction of waste recycling facilities in the world, Lviv City Council press service reports. The €35 million project, funded by the EBRD is to have a capacity of 240,000 tonnes of garbage per year and take 24 months to build and commission. After which the winning company will operate the facility and train local specialists for a year.

Rolled steel and cast-iron production up.Production of rolled steel increased by 5% in H1 2018 y-o-y to 9.247 million tonnes, according to the Ukrmetalurgprom association.Steel smelting grew by 1%, to 10.347 million tonnes, whilst cast iron output increased by 8%, to 10.151 million tonnes. In June, Ukrainian metal companies produced 1.631 million tonnes of cast iron (103% of the previous month), 1.669 million tonnes of steel, down 2% and 1.524 million tonnes of rolled steel also down 2%.This is set against major falls in production in 2017 when steel output fell 12% y-o-y to 21.284 million tonnes, rolled steel by 14%, to 18.439 million tonnes, and cast iron by 15%, to 20.035 million tonnes.

NBU lowers forex reserves forecast by almost $1 bln in 2018. The National Bank of Ukraine has lowered its forecast of international reserves by the end of 2018 to $20.7 billion from $21.6 billion, according to the Central Bank website. The main reason for the revision is a reduction in expectations regarding receipts from the placement of Ukraine's of eurobonds to $1.5 billion from $2.5 billion, Deputy Governor of the NBU Dmytro Sologub said yesterday.At the same time, the National Bank expects reforms to be implemented, and in 2018 Ukraine will receive a $2 billion disbursement from the International Monetary Fund, as well as loans from the European Union and the World Bank.

NBU raises refinancing rate to 17.5%.The National Bank of Ukraine (NBU) has raised the refinancing rate by 0.5 percentage points to 17.5% from July 13, 2018, to bring inflation into the target range for 2019.The key policy rate was approved by the NBU Board yesterday according to the banks website. "The impact of inflation will become stronger in future, but the tight monetary policy will offset their effect and drive inflation back to the target range in 2019.At the same time, in H2 2018 and 2019 inflation will be exposed to a number of factors including higher-than-expected domestic demand due to wage growth and greater remittances from labour migrants as well as less interest of investors in Ukrainian sovereign debt and postponed financing under the IMF cooperation program," it said.

Milk and meat production down, eggs up. The production of milk in Ukraine in H1 2018 declined by 1.8% y-o-y to 4.955 million tonnes. The production of meat over the same period also fell by 0.6%, to 1.551 million tonnes. According to earlier statistical reports, milk production in 2017 decreased by 0.5% from 2016, to 10.329 million tonnes and meat by 0.4%, to 3.259 million tonnes.At the same time, egg production in H1 2018 grew by 2.8% y-o-y, to 8.187 billion eggs.In 2017 egg product increased by 3.2%, to 15.578 billion eggs the State Statistics Service of Ukraine said.

Monthly sugar exports up 25%.Ukraine exported 67,600 tonnes of sugar in June, 25% up on the previous month, Ukrtsukor report. Head of the association’s analytical department Ruslana Butylo reported that 51% was shipped to Uzbekistan, 35% to Libya, 5% to Azerbaijan and 3% each to Armenia and Georgia. In the 10 months of the current year Ukraine exported 501,000 tonnes, 32% less than in the same period last year.With world sugar prices low sugar beet crops have been sown on 280,000 hectares, 13% less than last year forecasting a 10% drop in production to around 13.1 million tonnes reducing sugar production to around 1.75 million tonnes, the association said.

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