BUSINESS IN BRIEF (12/20/98)

BUSINESS IN BRIEF

Rocket launch planned to renew confidence

KYIV - The launch of the Ukrainian-Russian satellite Ocean-O at the Dnipropetrovsk Pivdenmash with the help of the Zenit rocket is planned for December 20 or soon afterwards. The launch will, in effect, be a trial for the Russian side of the operation. It should demonstrate that the leaders of the Science Automation and Equipment Production Center corrected their mistakes following September's Zenit rocket crash and renew Global Star's confidence in the rockets. Global Star's Sea Launch project proposes to launch satellites from floating platforms with modernized Ukrainian Zenit rockets. Foreign customers, in a bid to reduce risks to the rest of their satellites, will wait for at least two accident-free launches before registering new orders. (Eastern Economist)

U.S. firm keen on Ukrainian gas route

KYIV - The American firm Conoco Overseas is interested in developing a Ukrainian route to supply European countries with Caspian gas. Odesa Mayor Ruslan Bodelan held negotiations on December 1 with Conoco's London branch president, Tom Knudsen, over the possible use of the Odesa state enterprise ExImNaftoProdukt's facilities and the proposed Odesa gas terminal building. Mr. Knudsen said that gas supplies from Kazak and Russian Caspian Sea sources would compensate for any shortage in supply of Russian crude oil to ExImNaftoProdukt. This year the enterprise operated at just 15 percent of capacity, with only 1.5 million tons of crude oil coming to the plant. Mayor Bodelan said the scale of American investment in the project is similar to the building of the Pivdennyi oil terminal and the Odesa-Brody pipeline. (Eastern Economist)

New business initiatives get local boost

SUMY - Ukrainian charity Nauka's business incubator for new entrepreneurs opened on November 30 at Sumy State University. The educational and methodological center for businesspeople is financed by George Soros's International Renaissance Foundation. The center has programs in production management, financial management, marketing, accounting and legal rights for entrepreneurs. Oblast heads will offer consultation on financing and investment opportunities. (Eastern Economist)

VW praises prosperous Ukrainian market

KYIV - To note the fifth anniversary of its work in Ukraine, Volkswagen importer InterCar Ukraine recently held a press conference. Regional Sales Manager for the CIS and Middle Asia Ralph Peter Poersch said Ukraine is the only CIS country that is promising for them. VW plans to bring direct investments into Ukraine through construction of a service center. At present, there are 10 technical support centers for VW cars, and 2,200 cars have been sold in the last five years. Of those sales, 65 percent are in Kyiv, he added. The company declared that in February it will bring to Ukraine five new VW models fully adapted to Ukrainian roads. (Eastern Economist)

Coke expanding its operations in Ukraine

KYIV - "The Coca-Cola company considers itself a part of the Ukrainian business community," said Coca-Cola Beverages CEO Neville Isdell during a meeting with President Leonid Kuchma on November 17. He said that in the near future the company will open a plant in Brovary, into which $150 million (U.S.) has already been invested. Mr. Kuchma said he regards the opening of this plant in the current climate a reflection of the firm's commitment to Ukraine. (Eastern Economist)

Ukrainian insurers are in poor shape

KYIV - Almost half of Ukraine's 230 insurance companies have lost their statutory funds due to the devaluation of the hryvnia, Insurance Activity Supervisory Committee Chair Ihor Yakovenko told the international conference "Reorganization, Merger and Acquisition: World Experience and Mechanisms for their Realization in Ukraine." He said the statutory funds of these companies had fallen lower than the 100,000 ecu (European Currency Units) foreseen by the legislation, and that they would need to be restructured. Currently there is a tendency on the insurance market for two or more small companies to merge and for larger companies to acquire smaller ones. According to Insurance Organizations League President Oleh Filoniuk, Ukrainian insurance companies account for 0.01 percent of the world insurance market and 0.04 percent of the European market, and these figures are growing. (Eastern Economist)

Ukrainian computer firm to produce laptops

KYIV - The Ukrainian computer firm Kvazar-Micro and America's Intel have announced production of the country's first domestically produced portable computers. Maksym Aheyev of Kvazar-Micro said his company has begun the serial production of its Senator 1020 and Senator 1030 notebooks. The notebooks will use Intel Pentium II processors. Kvasar-Micro plans to manufacture 100 of the notebooks this year with retail prices exceeding $3,000 (U.S.). (Eastern Economist)

Obolon, Sepro and Boryspil rated of top quality

KYIV - Beer manufacturer Obolon, Boryspil Airport and Kherson-based juice and wine producer Sepro won the third Ukrainian National Quality contest, it was announced on November 11. The awards come as part of the Quality Days in Kyiv, held in conjunction with European Quality Week. Experts from the European Quality Association compared the performance of Ukrainian enterprises against Total Quality Management principles involving financial results, resource management and managers' leadership qualities. "Quality problems are of psychological character in Ukraine," said Petro Kalita, president of the Ukrainian Quality Association, "but we have to change our mentality if we want to become a normal civilized society." (Eastern Economist)

| Home Page |