BUSINESS IN BRIEF (08/15/99)

BUSINESS IN BRIEF

AmCham members confer with Tyhypko

KYIV - U.S. Chamber of Commerce (known as AmCham) members expressed understanding of Ukraine's difficult economic situation and extended their positive appraisal of efforts taken by the president, Cabinet of Ministers and the National Bank of Ukraine to stabilize current economic disequilibrium. They also voiced readiness to further cooperate with Ukraine, especially in investment projects during a July 28 meeting with Serhii Tyhypko, vice prime minister for the economy. In describing Ukraine's current situation, Mr. Tyhypko focused on indicators of socio-economic development. In the course of discussion, participants drew the minister's attention to the instability of Ukraine's tax legislation which is a serious obstacle to investing in the economy. Mr. Tyhypko, in turn, informed the gathering that the Verkhovna Rada had passed a law on product-sharing agreements," changes to the laws on value-added and income taxes, and a draft tax code. Company officials present said these measures were indeed devised to straighten out certain nuances that raise fears among foreign investors. (Eastern Economist)

Dutch ambassador eyes Sumy investment

SUMY - Dutch Ambassador to Ukraine Onno Hatting van't Sant visited Sumy Oblast on July 29-31 at the invitation of Sumy Oblast State Administrator Volodymyr Scherban. "I'm impressed by the quantity of businessmen and investment projects I saw on the first day of my visit to Sumy," said the ambassador. He held negotiations with three oblast state administration vice-chairs, the mayor of Shostka, and officials from several large chemical, agricultural and machine-building enterprises. Mr. Sant promised to help to carry out a tender among Dutch companies to invest in some local projects. Holland will offer its technologies in the pork, forage and dairy industries. (Eastern Economist)

Business booming in metals for Donetsk

DONETSK - Donetsk Oblast saw 245 objects privatized in the first half of 1999, the target being 400, announced Volodymyr Altynnyk, head of the Donetsk regional branch of the State Property Fund on July 28. According to his data, 1.414 million hrv of privatization revenues have been transferred to the SPF and 1.495 million hrv to local budgets. In that period, investments in the region totaled 177.5 million hrv and $20.08 million (U.S.), which exceeds the amount envisaged in stocks sale contracts. The largest investment, a total of US $58,08 million (U.S.), came from the Metals Russia company to the Donetsk Metals Works. Stock sales in the first half of 1999 totaled 1.95 million hrv, 277 rent contracts were signed and 3.985 million hrv were received in rentals. (Eastern Economist)

Ukraine's grain crop predicted to grow

KYIV - Government agricultural specialists said on July 27 that Ukraine's farmers had harvested 13.3 million tons of grain - 750,000 tons more than in 1998. According to government experts, the early grain crop yield in 1999 will be much lower than in 1998, at 22.1 metric centners per hectare. In 1998 the yield was 23.9 metric centners per hectare. The government is confident, however, that the yield decrease will not affect the total crop since grain areas in 1999 are larger. (Eastern Economist)

Vodka production begins in Kirovohrad

KIROVOHRAD - The spirits and vitamins plant at Mezhyrich, Kirovohrad Oblast, has created 140 new jobs and will supply over 800,000 hrv to the state budget because of a new automated line for manufacturing and bottling the vodka Viktoria. Now the plant will be producing three vodkas: Viktoria, Haidamatska and Ukrainska z Pertsem, or Ukrainian pepper vodka. (Eastern Economist)

Donetsk steel plant enters new markets

KYIV - Donetsk Steel Plant General Manager Oleksander Ryzhenko said on July 27 that the plant has been successful finding new markets for its pipe billets in the United States, Romania and the United Kingdom. According to Mr. Ryzhenko, deliveries of pipe billets have been proceeding apace for the past three months. According to the DSP head, until recently most of the plant's steel went to Asian markets. In the first half of 1999, DSP made approximately 600,000 tons of steel products. Although sales were unsatisfactory in the first two quarters of 1999, Mr. Ryzhenkov said that prospects for the second half of the year are much better, especially when a new modernized electric furnace begins to operate at full capacity. (Eastern Economist)

45 percent stake offered in steel plant

KYIV - Ukraine's State Property Fund is going to trade a 45 percent stake in the Dzerzhynskyi Steel Plant via a non-commercial tender for cash by November 1. Two more stakes, of 10 percent and 13.83 percent, are to be traded for cash via stock exchange by October 1 and November 31, respectively. The state retains a 25 percent stake in DSP. The plant's managers are entitled to 4.97 percent of stock which they can buy for cash. Until now, 1.2 percent of shares has been sold, of this 0.52 percent on favorable terms to plant employees and 0.66 percent for privatization certificates. (Eastern Economist)

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