BUSINESS IN BRIEF (11/07/99)

BUSINESS IN BRIEF

44 percent of computers not Y2K compatible

KYIV - Some 44 percent of computers in Ukraine should be replaced or upgraded with special controllers. This was stated by the seventh sitting of the state commission for preventing and eliminating possible negative consequences of the Y2K computer problem. The Institute of Cybernetics has developed software and is ready to distribute it. (Eastern Economist)

Russian oil prices rise in Ukraine

KYIV - According to the UkrNaftoKhimPererobka report, the price of Russian oil supplied to Ukraine's refineries in October went up from $125 to $ 135 (U.S.) per ton. The price of domestic oil remained the same, at 395 hrv per ton. Wholesale prices of domestic oil refineries did not change in October. As of October 25, the price of diesel fuel was between 1,111 hrv and 1,150 hrv per ton. The price of A-76 gasoline ranged from 1,551 hrv to 1,556 hrv per ton, while A-95 gasoline was from 1,700 hrv to 1,934 hrv per ton. Two of Ukraine's refineries, those in Lysychansk and Kherson, were idle due to a shortage of oil. (Eastern Economist)

Ukraine plans to develop intelligence satellites

KYIV - Ukraine plans the development and construction of intelligence satellites, according to the deputy general director of the Ukrainian National Space Agency, Valerii Komarov. The major obstacle for implementation of this program is a lack of funds, since $100 million (U.S.) is needed to create one such a satellite, said Mr. Komarov, speaking on October 28. He added that Ukraine possesses all the land-based structures needed to control and operate the satellites. (Eastern Economist)

UkrZaliznytsia receives new loan

KYIV - The European Bank for Reconstruction and Development will provide Ukraine with a $51.88 million (U.S.) loan to finance the development of Ukraine's railroads. According to the Foreign Affairs Ministry press service, the project envisages modernization of the railroad infrastructure at the Lviv-Kyiv section, which is part of the European transport corridor. The implementation of this project will enable Ukraine's railroad carrier, UkrZaliznytsia, to substantially increase the density of freight traffic due to increased speed and improved safety. This is the second project prepared by Ukraine jointly with the EBRD this year. (Eastern Economist)

Utel must be sold to meet anticipated revenues

KYIV - The government will not be able to receive a planned amount of 2.5 billion hrv from privatization in 2000 unless it sells the closed joint venture stock company, Utel, a long-distance telecommunications company in which the state is the majority shareholder, stated the chairman of the State Property Fund, Oleksander Bondar. "Without selling Utel stock, this target is unrealistic and the draft budget should be changed," he stated. The Cabinet of Ministers will make another effort to get the Verkhovna Rada's approval for the sale of Utel stock in November. Mr. Bondar noted that national deputies feel reluctant to include UkrTeleKom, the state-owned telecommunications equipment company, on the Privatization List for 2000. "It will be necessary to lower the planned amount of funds received from privatization, since it will be impossible to find a replacement for UkrTeleKom, which stock is priced at 700 million hrv," said Mr. Bondar. Total funds received since the beginning of this year from privatization has reached 478 million hrv, with 500 million hrv expected by the end of October, said Mr. Bondar. (Eastern Economist)

Wrigley-Ukraina to import chewing gum

KYIV - Ukraine's Anti-Monopoly Committee gave the green light for the creation of the Wrigley-Ukraina company. The founders of the new company are Wrigley and Zeno, subsidiaries of the U.S.-based WM Wrigley. The goal of the new company is to optimize the import of chewing gum to Ukraine. (Eastern Economist)

Cabinet calls for restructuring Air Ukraine

KYIV - The Cabinet of Ministers has ordered the Transportation Ministry, the Economy Ministry, and the Finance Ministry to draft a program on restructuring the state carrier Air Ukraine. The State Tax Administration is instructed to give a respite to the airlines until December 29 in making payments to the State Innovation Fund (SIF) and Road Maintenance Fund (RMF), which had accrued by September 1. The respite is to be provided on condition of a tax credit at zero interest rate, with obligatory payment of current debts to the budget and earmarked funds. According to the Transportation Ministry, as of July 1 Air Ukraine's debts stood at 3,972,430 hrv to the SIF and 2,897,882 hrv to the RMF. The company's losses in 1998 reached nearly 8 million hrv and in the first half of this year, nearly 6 million hrv. At present, the company's receivables are 75.01 million hrv and payables 74.88 million hrv. Moreover, the company operates outdated planes that will exhaust their service life in mid-2001. (Eastern Economist)

Huge fall in agricultural output noted

KYIV - The production of principal agricultural and livestock products fell considerably in Ukraine during the 1991-1998 period: sugar beets by 57.2 percent, cereals by 31.6 percent, milk by 38.4 percent, meat by 82.5 percent, eggs by 45.4 percent. Their per capita production has dropped even more substantially: cereals by 46.5 percent, sugar beets by 63.8 percent, meat by 59.6 percent, milk by 42.1 percent, eggs by 47.4 percent. (Eastern Economist)

Kherson confectionery plant is booming

KHERSON - The AT Kherson Confectionery Plant produces more than 200 types of sweets, most of the recipes for which were developed at the plant itself. Various chocolates, candies, caramels, biscuits, waffles and gift boxes all enjoy high popularity. The plant recently bought equipment to produce fruit jellies and chocolate marshmallow. It plans to produce confectionery products for diabetics in the future. (Eastern Economist)

French company buys large stake in cement plant

LVIV - The French company Lafarge says it has acquired a controlling stake in the Mykolaiv cement plant in Lviv Oblast. "We have become a strategic partner of the open joint stock company Mykolaiv cement plant, and we hold 82 percent of the plant's shares," said Lilia Jolibois, the company's development director for Central Europe. This became possible after the company purchased 30 percent of plant stock during a trading session on the Ukrainian Interbank Currency Exchange in Kyiv, which was offered for sale by the State Property Fund. (Eastern Economist)

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