21:10 PM Sunday, September 23, 2018 - Monday, January 22
Turkey gives final permits to Russia’s Black Sea gas line; Ad sales up by one third; Grain exports down 9.5%; Poroshenko to meet IMF MD in Davos
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  • Turkey has given the final permits for Gazprom to build the 910 km Turkish Stream natural gas pipeline from Anapa, Russia, to Turkey’s northwestern coast. After commissioning, in two years, the $14 billion pipeline is expected to deprive Ukraine of $500 million a year in gas transit revenues.
  • Advertising increased by about one third last year, to $600 million, according to the All-Ukrainian Advertising Coalition. After last year’s rebound, the ad industry is expected to expand this year about half the pace, growing about 17%, to $700 million. Since 2016, ad spending has been flat for for radio and newspapers, has grown by 50% for TV, and has doubled for outdoor and digital.
  • Halfway through the grain marketing year, grain exports are down 9.5% compared to the same period last year. Ukraine has exported 22.8 million tons of grain since July, versus 25.2 million over the same period last year, the State Service for Food Protection, reports. However, the overall grain crop was down only 5.6% from 2016, a bumper year. The Agriculture and Food Policy forecasts that exporters will draw down stocks and that by the end of the marketing year, in June, grain exports will be down only 2%, to 41 million tons.
  • The IMF wants Ukraine to amend the bill on the high anti-corruption court and to rework the bill on pension reform, Gerry Rice, IMF spokesman tells reporters in Washington. An independent anti-corruption court is key for the IMF resuming loans to Ukraine. But Rice also cited the pension bill, saying it “also has some shortcomings that undermine incentives for people to work longer and their contribution to the system, and it doesn't fully ensure sustainable pension system.”
  • This week at Davos, IMF Managing Director Christine Lagarde is to meet with President Poroshenko to discuss the IMF program for Ukraine, IMF spokesman Gerry Rice says. Yakiv Smoliy, formally nominated on Thursday to serve as National Bank Governor, is to join the talks.
  • The debt clock dictates that Ukraine pass reforms and get on track with the IMF by May, says Ivan Miklos, the Slovak politician who heads the Group of Strategic Advisors for Support of Reforms in Ukraine. Speaking on Channel 5, this government advisor warned: “Ukraine will not be able to finance its obligations without a program of the Monetary Fund...It will be necessary that these prerequisites of the monetary fund be met in spring, that is before the end of May, so as not to create problems in financing.”
  • Ukraine faces a bleak year, if it does not get back on track with the IMF program, Sergey Fursa, a Dragon Capital, debt specialist, tells Novoye Vremye newsweekly. Without the IMF seal of approval and the required free market changes, he said: "External debt markets will immediately be closed. Economic growth will begin to fade. Reserves will melt. Do we try such a situation before the presidential election? Maybe. Will there be enough resources? No. There will be debts to pay, but there will be no new money.”
  • Ukraine should minimize public spending on the bank bailouts and maximize seizures of bank collateral from bad loans, the local representatives of the IMF, the World Bank and the EBRD recommend in a joint letter. With the nation struggling with $7.6 billion in bank bailouts, the three representatives called on Ukraine’s government to pursue collections of outstanding loans and to prosecute former shareholders of failed banks. Concorde Capital’s Zenon Zawada notes the letter was released on the same day as the Prosecutor General announced the possibility of criminal cases against the principal beneficiaries of PrivatBank, Ihor Kolomoyskiy and Gennadiy Bogolyubov. Zawada writes the letter was “intended to muster international support for the Ukrainian government in its attempt to make some order out of its collapsed banking sector.”
  • January’s fall of the hryvnia was caused by payments abroad and a decrease in exports, Prime Minister of Groysman said Sunday on ICTV. Saying the hryvnia “is freely regulated,” he said a similar phenomenon happened at the beginning of last year. Projecting confidence in the currency, he added: "But when everything starts working perfectly normally, when we start exporting, when the balance begins to be saved, the situation eases.”
  • Power company DTEK plans to build this year Ukraine’s first road section using coal ash and slag from coal-fired power plants. The section, in rural Lviv, will only be one kilometer long, but DTEK officials are optimistic about the technology. Coal ash is increasing used in building construction and to build roads, notably the Eisenhower Expressway in Chicago and the Øresund Bridge between Denmark and Sweden. Ukraine’s power plans generate about 7.5 million tons of ash and slag wastes per year, 6 million by DTEK.
  • Coffee House is the latest Russian food chain to fail in Kyiv the last two years. Since 2016, three quarters of the Coffee House outlets in Kyiv have closed, leaving only four. Similarly, Yakitoria closed its restaurants in 2016. In addition, Rosinter closed in Kyiv its Il Patio restaurants, then its TGI Friday’s.
  • Ukraine’s first 3D laboratory in Ukraine has opened at Kharkiv Polytechnic Institute to train specialists in the field of metrology and technical measurements for machine building and other industries, the Institute's press service reports. The lab is equipped with a 3D scanner, a 3D printer, a tool for 3D measurements and digitization, and a portable coordinate-measuring system for high-precision measurements at extremely long distances.
  • Exports to EU pulled up Ukraine’s overall exports through November, according to numbers posted by Natalia Mykolska on her Facebook page. Ukraine’s exports to the EU jumped by 30.4%, to $15.9 billion. Ukraine’s overall exports grew at a slower rate, by 20.6%, to $39.5 billion.
  • Exports to the US almost doubled last year, hitting $746 million through November. Other export increases were: up 19.5% to Turkey, to $2.2 billion and up 17.5% to China, to $2 billion.
  • The Czech Republic is doubling its work permits for Ukrainians, to 7,000 this year, Yevhen Perebyinis, Ukraine’s ambassador to Prague, tells Yevropeiska Pravda. With 4.3% GNP growth in 2017, employers in Eastern Europe’s fastest growing economy had complained that the government was taking six months to process work visas. Last year, Czech deported about 1,000 Ukrainians working there on Polish work permits were deported. At $33,00, Czech has a per capita income 20% higher than Poland’s and four times that of Ukraine.
  • A draft law allowing individuals to collect scrap metal could turn Ukraine into a nation without manhole covers and telephone wires, warn scrap metal collecting companies and their trade associations. The draft bill was submitted last week to the Rada committee on economic policy, Interfax reports.

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