On April 22, 2021 CUCC in cooperation with US-Ukraine Business Council (USUBC) hosted a webinar “Development of Extractive Industries in Ukraine”. More information about the event, including a recording you may find here.
An event gained a big audience and as a response to numerous requests, we are posting the presentations of the event speakers:
1. Presentation by Sergiy Tsivkach, Executive Director of UkraineInvest
The Canadian-Ukrainian Chamber of Commerce (CUCC) continues to closely monitor developments surrounding a lawsuit in which the Canadian renewable energy investor TIU Canada is defending its rights against the Nikopol Ferroalloy Plant in connection with the illegal shutdown of its Nikopol solar power plant from the power grid.
The company, also a member of CUCC, appealed the initial decision of the Commercial Court of Kyiv. The first hearing in the appeal process was supposed to take place on April 12, 2021, but was postponed due to the judge’s illness and a reported bomb threat towards the Northern Commercial Court of Appeal in Kyiv. The next meeting is scheduled for May 17, 2021, at 11.40 AM. According to TIU Canada, they are fully committed to asserting their rights, including with the Supreme Court of Ukraine.
As the largest Ukrainian Canadian business association, we cannot stand aside and express our hopes that the rule of law will prevail in this matter. What is also important is the continued public discourse this situation has gained abroad, especially in Canada, where high-ranking politicians have published direct statements on the matter. This continued attention may cause further negative impacts on Ukraine’s investment image and exacerbate the tendency to reduce foreign investment due to further negative signals regarding the investment climate.
We call on the Government of Ukraine to bring further attention to this case, promote equal conditions for doing business for all stakeholders in compliance with the norms and provisions set forth in the legislation of Ukraine. We also call on the Government of Ukraine to adhere to their own prior public statements on foreign investment protection.
April 22, 2021, marked an unprecedented online discussion of 2021 development opportunities for Ukraine’s extractive industries sector between UkraineInvest, State Geologic and Subsoil Survey of Ukraine and State Property Fund of Ukraine and mining business representatives and investors.
The discussion was opened by Zenon Potoczny, President, Canada-Ukraine Chamber of Commerce (CUCC) and Morgan Williams, President/CEO, U.S.-Ukraine Business Council (USUBC) and moderated by Morgan Williams and Emma Turos, Managing Director for Ukraine, CUCC.
The event was attended by over 300 participants representing the North American and global investment community.
Sergiy Tsivkach, UkraineInvest’s Executive Director, made a presentation on the role and activities of UkraineInvest as an investment promotion agency and the institution designated to provide support for investment in Ukraine, as well as on investment climate improvements, recent regulatory developments, and work in the regions in various fields.
Roman Opimakh, Director General of the State Geological and Subsoil Survey of Ukraine presented investment opportunities in the subsoil sector of Ukraine and Taras Yeleyko, Deputy Head of the State Property Fund of Ukraine, made the presentation on state property privatization objects in Ukraine’s extractive industries sector.
The presentations were followed by a lively and candid discussion with the participation of three companies who already invested in operations in Ukraine and are at various stages of their projects. The business community noted the progress which Ukraine has made recently in oil & gas upstream, mining and other areas and confirmed interest in further exploring investment opportunities which Ukraine has to offer.
The top management of the state agencies and the business community agreed to continue discussion of and cooperation in resolving various issues which are important for international and domestic businesses alike to further improve Ukraine’s attractiveness for investment.
The recording of the event is available at USUBC’s YouTube channel: https://www.youtube.com/watch?v=Pv2fd5fvFKg
We would like to share with you the presentation of the Kherson region of Ukraine that was shared with the CUCC during the International Council of Business Associations and Chambers (ICBAC) where our Managing Director-Ukraine Emma Turos is currently serving as a General Secretary.
Should you have any questions regarding the presentation or would like to contact Kherson region investment office, please contact our team at email@example.com
We would like to invite you to the online information session “Ukraine-Canada Opportunities”, organized by CUCC in partnership with the Province of Manitoba, Canada and WTC Winnipeg, that will take place on March 03, 2021, at 18.00 CET (10 AM CST). This event is addressed first of all at the Canadian business but may be of interest for Ukrainian entrepreneurs as well. Speakers are the representatives of Ukrainian Embassy in Canada and the Canadian Embassy in Ukraine, AGI, UkraineInvest and the CUCC team. To find out more, click the link
We would like to take this opportunity and announce the next online event with the Province of Manitoba, which is aimed at Ukrainian businesses and will take place at the beginning of April. More details on this event will follow.
The meeting was dedicated to discussion of a proposed amendments to the Law of Ukraine “On State Property Fund of Ukraine” and other legislative acts of Ukraine to promote investment through privatization and lease of state property”.
The purpose of the bill is to accelerate privatization by: improving the institutional mechanisms of privatization, establishing an efficient organizational structure of State Property Fund of Ukraine and clarifying certain aspects of legislation concerning privatization and corporate governance of state assets to ensure effective and responsive management while an SOE is being prepared for privatization.
According to Dmytro Sennychenko, Head of State Property Fund of Ukraine, suggested novelties will allow to protect state property rights, interests of foreign investors and make the privatization procedure more user-friendly. The Fund expects to attract a record sum of 12 bln UAH from privatization in 2021.
We will continue to follow the news on this.
More info on this meeting (in Ukrainian) http://www.spfu.gov.ua/ua/news/7179.html
On January 25, 2021 Alfred F. Praus, President of the Ukrainian-Austrian Association, after serving for two years as ICBAC General Secretary, handed over the General Secretariat of the International Council of Business Associations and Chambers in Ukraine, which is rotated yearly, to Emma Turos, Managing Director of the Canada-Ukraine Chamber of Commerce. We are looking forward to a fruitful and interesting work within the ICBAC framework and new projects to be completed. Stay tuned.
Swedish clothing brand H&M will open its first store in Ukraine in 2018. The information appeared in the company’s six-month report for 2017.
“New H&M store markets planned for 2018 are Uruguay and Ukraine,” the document read.
H&M has been one of the most anticipated international brands in Ukraine, along with Ikea. Rumours of its entrance have been circulating for many years, but this is the first-ever official confirmation of such plans.
This spring H&M entered the markets of Kazakhstan and Colombia, and the brand has been a success there, according to the report. New openings are planned in Iceland, Vietnam, and Georgia.
The company also reported 9 percent growth in sales to over $13.3 billion during the first six months of 2017.
H&M (Hennes & Mauritz AB) is now present in 69 countries and is the second largest retailer in the world after Spanish Inditex Group. It includes H&M, COS, & Other Stories, Monki, Weekday, and Cheap Monday as well as H&M Home.
Another anticipated Swedish brand, homeware manufacturer Ikea, also has set its eye on Ukraine.
In early June the representative of the company told the Kyiv Post that Ukraine was “one of the markets that Ikea is exploring for expansion opportunities.”
More recently, the aviation industry has indicated signs of recovery with considerable growing demand forecast over the next decade in regions such as the Asia-Pacific and Middle East. In these regions, to operate a large number of aircraft produced in Ukraine and the countries of the former Soviet Union. Now Ukraine expands aircraft maintenance and repair offering in anticipation of probable contracts.
Commercial and military aircraft maintenance and repair is an essential requirement to safely transport passengers, troops or cargo. In Ukraine, the major role in the aircraft maintenance and repair plays the state enterprise «PLANT 410 of Civil Aviation» (SE PLANT 410 CA).
The SE PLANT 410 CA, which is a part of Ukrainian defence industry concern UkrOboronProm, is one of the leading enterprises of aviation cluster of Ukraine, specializing in heavy airframe maintenance and modification services and component maintenance, repair, and overhaul services for commercial and regional aircraft.
The SE PLANT 410 CA as of today, executed overhaul more than six thousand aircraft and forty thousand the aviation engines. The enterprise occupies an area of over 236,000 square meters adjacent to the Kyiv International Airport (Zhuliany). Production area is equipped with all the necessary technological tools, tooling and equipment and makes up for more than 170,000 square meters, where overhaul.
The SE PLANT 410 CA represents the powerful aircraft-repair enterprise, that can carries out a full work cycle of overhaul of aircraft An-24,-26,-30,-32 and aviation engines D-36 of a series 1, 1А, 2А, for aircraft Yak-42, An-72,-74, repair of units of aviation technique, and also the works connected with restoration of aviation details.
On performance of works on overhaul, modernization, re-equipment and maintenance service of aircraft such as “Antonov”, the plant has certificates of interstate aviation committee, Ukrainian national aviation authorities, the certificate of conformity of the Russian aviation authorities. The system of quality of the plant is certificated under the international standards of series ISO, and also airspace complex AS / EN. Taking into account, that works on repair of military planes performed, the factory has the certificate of the standard of the NATO – AQAP 2120, and also the license of the Ministry of industrial policy for repairing of military aviation technique.
One of the directions of development is the realization of the program maintenance and repair of Soviet-made helicopters. The enterprise conducts restore after overhaul, re-motorization, and modernization of Mil Mi-8 medium twin-turbine helicopters, for use in a national economy and Ukrainian Defence Forces. Realization of the project carried out together with joint-stock company “Motor Sich”.
The SE PLANT 410 CA has also successfully completed MI-8MSB helicopter overhaul and upgrade having fitted it with a Motor-Sich-made advanced TV3-117VMA-SBM1 engine, avionics, AirAmbulanceTechnology-made intensive care units. The retrofit helicopter was handed over to the Customer on 11.08.2016.
Currently, other three Mi-8T helicopters are undergoing overhaul and upgrade.
The Armed Forces of Ukraine, the National Guard and Border Guard also act as clients of the SE PLANT 410 CA enterprise. In 2016 enterprise specialists repaired 6 aircraft, according to aircraft equipment overhaul and modernization schedule, that was reported by UkrOboronProm.
During repair each vehicle was completely dismantled and all components and devices were repaired/replaced by new ones. In addition, these aircraft also have new modern digital navigation and communication systems.
The SE Plant 410 CA is a leading enterprise in Ukraine, providing overhaul of D-36 engines, installed on military transport aircraft An-72, in service with the National Guard of Ukraine and Border Guard. In addition, the same engines are installed on An-74 and Yak-42 aircraft, operated in many countries.
The collective of a factory makes huge efforts on preparation for certification on norms and rules of the European organization on safety in aircraft EASA (PART-145, PART-147, PART-66, PART-M). It will allow to diversify the work not only on technique such as Antonov, but also to carry out maintenance service of planes of foreign manufacture. The enterprise already has such customers. For today maintenance service more than 15 airliners Boeing-737 is carried out. On the areas of a factory planes MD-80,-82,-83 are served. Also, plant fruitfully works with business aircraft.
This and the active efforts of the foreign economic activity of the plant, the enterprise consistently receives new orders for aircraft repair and modernization not only from domestic customers, but also firmly entrenched in the international market, which provides foreign exchange earnings to the state. The main foreign clients of the SE PLANT 410 CA is the Republic of India, Republic of Kazakhstan, the People’s Republic of Bangladesh, Hungary and other countries. Over the past two years, exports to foreign countries increased by 2 times, from UAH 168.4 million UAH in 2014 up to 345.3 million UAH in 2016.
Despite several turbulent years, Ukraine’s economy is now showing real promise. The country recently received its latest tranche of IMF funding and is making a huge effort to stamp out corruption. With a large base of highly skilled technology professionals and a highly-developed information technology sector, Ukraine’s economy has all the ingredients required to create Europe’s next big technology hub.
Technology is certainly one of the main industries driving Ukraine’s economic growth. The country has a huge number of skilled technology professionals and is already one of Europe’s top outsourcing hubs. Ukraine is home to over 4,100 firms that outsource skills to other countries and it exports approximately $2 billion in software development and service each year. Its sophisticated IT sector offers the highly skilled workforce that is required to create a successful technology hub.
Ukraine also has a burgeoning e-commerce sector. E-commerce Europe (the European association representing e-commerce businesses) states that the country’s online shopping market is worth approximately €1 billion; with a typical annual spend, per shopper, averaging at €286. With a wide consumer base that is willing to spend money online, Ukraine has the market for e-commerce and consumer tech businesses.
The final ingredient that is required to create a successful technology hub is innovation. From my experience of working with businesses in the Ukrainian tech sector, this is something which exists in abundance in Ukraine. It is well-known that programmers who are educated in Ukraine receive world-class teaching and, after graduating, have access to jobs where they can develop their programming skills in the outsourcing sector. With so much talent being nurtured in the technology sector in Ukraine, innovation is available in abundance. Unfortunately, however, domestic opportunities for these entrepreneurs are currently lacking.
Today, we are losing our brightest tech talent to more developed tech start-up markets, including Silicon Valley, London and Tel Aviv. Investor confidence in the Ukrainian market is fragile to say the least, so technology entrepreneurs seek instead to turn their ideas into businesses elsewhere in the world.
So, how should Ukraine encourage and retain its most promising technology entrepreneurs?
The solution is two-fold: increase investor confidence in the Ukrainian technology sector and create awareness of the investment opportunities for Ukrainian entrepreneurs who are running their businesses from Ukraine.
As concerns investment, increasing confidence in Ukraine’s technology market is the key. It is important for the government to highlight Ukraine’s openness to new technology ventures. A great example of this is the recent Twitter exchange between Ukraine’s Prime Minister and Elon Musk which received global attention. This exchange told the world that Ukraine is open for business.
As investors gain confidence in the market, they may choose to embrace the opportunities to invest in low-cost / high yield Ukrainian technology businesses. After all, it is much cheaper to scale a technology business based in Ukraine compared to a business in one of the better-known technology hubs.
Education is hugely important, to increase awareness of the investment opportunities for entrepreneurs in Ukraine, We must ensure that the most promising Ukrainian talent is aware that there are ways to create successful businesses in their own country.
As a venture capitalist, it is my responsibility to consciously invest in businesses with commercial potential but also in businesses that have the potential to change society. It is for this reason that I am so passionate about transforming Ukraine into Europe’s next technology hub.
Stepan Chernovetskyi is the founder and CEO of Chernovetskyi Investment Group, a venture capital firm specialising in funding promising technology businesses based in the CIS region. He began his career at Pravex Bank, where he was finally appointed the Senior Vice President. After that, he became Head of the Supervisory Board of PJSC, a company specialising in real estate investment and construction. Stepan also runs a charity which helps orphans, large families and elderly people in Georgia.