7:12 AM Sunday, October 21, 2018 - Wednesday, December 20
IKEA comes to Kyiv; Rada votes tomorrow on new Central Bank head; Dragon aims to bring $300 million into Ukraine; Min Fin sells $402 million in bonds
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  • IKEA plans to enter Ukraine, opening its first store in Kyiv by 2019, an executive of the Swedish-based retailer said Tuesday after meeting Kyiv Mayor Vitali Klitschko. Development of stores in Ukraine will be handled by IKEA South-Eastern Europe, which operates stores in Croatia, Romania, Serbia and Slovenia. Stefan Vanoverbeke, sales manager for this IKEA unit, said in Kyiv: “Our company will present in Ukraine a wide range of affordable home products to meet the high demand from consumers.”
  • Retail trade through November is up by 8%, compared to the first 11 months of 2016, the State Statistics Service reports.
  • Dragon Capital plans to attract to Ukraine up to $300 million in investments in 2018, Tomas Fiala, general director and founder of the investment house, told reporters Tuesday. Fiala said Dragon would work with co-investors: Goldman Sachs, George Soros, and OPIC. He said: "We have about 10 deals in the pipeline." Due to perceptions of country risk, he said, asset prices in Ukraine today are the cheapest since 2004. In the West, similar assets would be three times more expensive.
  • The Rada is to vote Thursday on whether acting central bank chief, Yakiv Smoliy, should become Governor of the National Bank of Ukraine. Vadym Denysenko, the government's representative to parliament, told 112 TV: “One candidate is being considered, and it's acting governor Smoliy.” Smoliy took over last May after Valeriya Gontareva resigned as governor. He has proved to be a supporter of Ukraine’s program with the IMF.
  • Ukrainian banks have set a 'world record' for the highest share of non-performing loans – 56%. Vitaliy Vavryshchuk, director of the Financial Stability Department at the National Bank of Ukraine, said a press briefing Monday: “We have established a somewhat unpleasant and very costly record for the economy and banking sector: the highest share of non-performing loans has been recorded in Ukraine in the entire history of world observations." Since 2014, the central bank has closed half of the nation’s banks and has ordered surviving banks to raise reserves. Looking forward, he said: "We need to do something with the bad debts. They need to be more actively handled by clearing up, writing off or restructuring."
  • The Finance Ministry sold $402 million in foreign exchange bonds Tuesday at 5-5.4%. At auctions, the government sold annual domestic bonds, or OVDP, for $378.46 million at 5% per annum and two-year bonds for $23.63 million at the previous rate of 5.4% per annum. All applications to buy were satisfied.
  • In 2018, the Finance Ministry will sell a maximum of $2 billion Ukrainian Eurobonds, the maximum agreed under the current Extended Fund Facility with the IMF, Deputy Finance Minister Yuriy Butsa said Tuesday at a press conference. In September, Ukraine placed 15-year eurobonds for $3 billion at 7.375 percent per annum. Demand for the eurobonds was $9.5 billion.
  • Ukraine’s gross foreign debt on Oct. 1 was $117.3 billion, or 3.3% higher than at the start of the year, according to the website of the National Bank of Ukraine.
  • Finance Minister Oleksandr Danylyuk predicted Tuesday that Ukraine will meet IMF conditions for ‘more’ than two tranches of fresh funding in 2018. Speaking at an end of the year press conference, he said: "There are a few key conditions that have not been fulfilled, but it is absolutely realistic that they will be fulfilled next year."
  • Without an IMF loan, the hryvnia will fall in 2018 below 30 to the dollar, predicts Tomas Fiala, general director of Dragon Capital and president of the European Business Association. He told reporters Tuesday: “If, from the second quarter of 2018, we can not resume IMF financing, we can forget about the stability of the hryvnia." So far this year, the hryvnia has been Eastern Europe’s worst performing currency, losing 2.5% to the dollar and 14% to the euro.
  • The new transparent and largely automatic VAT refund system has resulted in about $3.2 billion of VAT refunds paid to businesses since its launch on April 1, Finance Minister Danylyuk said Tuesday: "The launch of the transparent VAT refund register was one of the greatest anti-corruption achievements of the Finance Ministry over this year.”
  • A bill to simplify procedures for oil and gas companies to obtain land use rights passed its first reading Tuesday in the Rada. Prime Minister Groysman, who is trying to encourage investment in oil and gas drilling, tweeted: “The draft law adopted today is an important step towards the large-scale increase in our own production and the launch of new domestic projects in the gas sector."
  • Robert Whalley, a British board member of Ukrnafta, Ukraine’s largest producer of oil and gas, has resigned. Whalley, a 30-year veteran of Schlumberger, had been Ukrnafta’s executive vice president for Technology and Services for the last two years.
  • Portugal and Antonov may jointly develop a firefighting aircraft, President Poroshenko's press secretary Svyatoslav Tsegolko tweeted at the end of Poroshenko’s visit to Lisbon. In mid-October, almost 8,000 forest fires broke out in northern Portugal and Spain, killing 45 people in Portugal. On the worst day, firefighters battled 440 fires in Portugal.
  • Most of Ukraine was digging out Tuesday from a blizzard that dumped 30 cm of snow in much of the nation. The snowfall caused massive traffic jams in Kyiv, delayed 30 trains, and delayed dozens of international flights in and out of Kyiv’s two commercial airports, Zhulyany and Boryspil. Wizz Air temporarily shifted flights to Boryspil. At London’s Luton airport, the flight cancellation and story switching by Wizz Air counter clerks so enraged 120 Kyiv-bound passengers that police had to escort them from the terminal.
  • Hutchison Ports, the world's largest container terminal operator, has applied to lease six berths at Chornomorsk port, 30 km south of Odesa city. Infrastructure Minister Vladimir Omelyan wrote on Facebook of the Singapore-based company: “There is still a tender, a ton of bureaucracy, but this is the most important step for Ukraine.”
  • Showcasing IT, Ukraine House will operate in Davos, Switzerland, during World Economic Forum's annual meeting, from Jan. 22-26. The goal is to promote investment opportunities in Ukraine’s IT and innovation sector to global business, technology and investment leaders. The organizers are: Ukrainian Venture Capital and Private Equity Association, Western NIS Enterprise Fund and Victor Pinchuk Foundation. The Ukraine Business Journal is preparing an in depth, forward looking IT Opportunity Supplement. For advertising, contact UBJ CEO Christian Kalkar at:

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