BUSINESS IN BRIEF (01/24/99)

BUSINESS IN BRIEF

Volvo studies JV opportunities in Zhytomyr

ZHYTOMYR - Volvo representatives visited the Zhytomyr region on the invitation of the head of the Zhytomyr Oblast State Administration, Volodymyr Lushkin, on December 15-17, 1998. The aim of the visit was to study the possibility of creating a joint venture assembling Volvo buses at the Zhytomyr repair plant. During meetings with local businessmen, Volvo manager Johann Nilsson confirmed that, in spite of the recent crisis, Eastern Europe and the new independent states remain a zone of special interest for Volvo. In particular, he mentioned that in 1997 Volvo set up an assembly plant for buses in Omsk, Siberia. Mr. Nilsson scheduled the next visit to the Zhytomyr region for the beginning of 1999, but stressed that any decision hinged on detailed research of the Ukrainian market. (Eastern Economist)

Omnipoint chooses new partner in Ukraine

CEDAR KNOLLS, N.J. - Omnipoint Communications has announced its two new international roaming partners. The Personal Communications Services provider activated its first roaming deal in Ukraine with Ukrainian Mobile Communications and its second agreement in South Africa with Mobile Telephone Networks. "It is clear Omnipoint is the standout in the wireless industry when it comes to international roaming," said Omnipoint President George Schmitt. Omnipoint uses GSM (Global System for Mobile) communications wireless technology. (Eastern Economist)

Daewoo to rethink scale of operations

ZAPORIZHIA - Due to the consequences of the world financial crisis AvtoZaz-Daewoo must urgently amend its business plan or even draw up a new one, Oleksander Sotnykov, the board chairman said on December 30, 1998. According to Mr. Sotnykov, while the new business plan is not ready, the tentative target figure for car production at Zaporizhia in the first quarter of 1999 has been fixed at 1,500 cars. AvtoZaz-Daewoo's target sales figure for the same period is nearly 15,000 cars. Plant employees have been given an extended Christmas holiday which will last until mid-February. In early 1998 AvtoZaz-Daewoo's plan for the year was to turn out 40,000 Tavrias and 32,000 Korean models. In reality, only 11,128 Tavrias and 12,926 Korean cars of various makes have been manufactured and only 44 percent have been sold. In view of this, Kim Wu Jung, Daewoo president, proposed that total output at Zaporizhia be limited to 10,000 cars per year. The Ukrainian party, however, does not agree to this proposal, Mr. Sotnykov said. According to AvtoZaz experts' calculations, in Ukraine alone 37,000 to 39,000 cars could be sold annually. And as the Korean party's commitment in the contract on setting up the joint venture was to export 50 percent of cars, the sales figure could be brought up to 72,000, added Mr. Sotnykov. (Eastern Economist)

Chornobyl employees get state support

KYIV - President Leonid Kuchma on January 8 signed a law granting tax breaks for companies whose work is related to the planned closure of the Chornobyl nuclear power station. The law introduces five-year tax breaks both for companies participating in the plant's closure and for businesses that will be started in a 30-kilometer zone around the plant to provide jobs for plant employees. Additionally, foreign-made equipment needed to shut down the plant can be imported tax-free, and former plant employees will be eligible for special financial assistance from the state for more than a year while they search for new jobs. (Eastern Economist)

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