BUSINESS IN BRIEF (01/02/00)

BUSINESS IN BRIEF

New bridge to span Kerch Strait

SYMFEROPOL - The protocol for setting up the Russia-Ukraine Mist JSC, signed on December 6, 1999, was characterized by Leonid Hrach, chairman of the Crimean Council of Ministers, as "an investment breakthrough into the 21st century." Russia-Ukraine Mist will build a multi-tiered bridge across the Kerch Strait in the Sea of Azov. The office of the Moscow Mayor Yuri Luzhkov will own a 51 percent controlling stake in the new JSC, while the administrations of the Crimean Autonomous Republic and the Krasnodar Krai in Russia will each own a 24.5 percent stake in the company. The cost of the project is estimated at nearly $1 billion (U.S.) and plans are for the upper tier of the bridge to be used for automobile and railway traffic and the lower tier for the conveyance of electricity, gas, oil and petroleum products. (Eastern Economist)

Express delivery market is growing

KYIV - The international express delivery company DHL announced an increase in sales volume by 22 percent since the beginning of 1999. From September through November alone DHL shipped a record 64,000 parcels. Company experts expect continued growth, and therefore made a decision to expedite putting into operation a new international terminal in Kyiv, which will start up in early 2000. The terminal will allow DHL to process up to 5 tons of cargo daily. Furthermore, the company will be able to improve the quality of its delivery service. The commercial director of DHL, Vadim Sydoruk, said that "indicators in the express air delivery industry are a direct reflection of the state of business activity in Ukraine. Sales volume growth trends attest to the growing potential of the Ukrainian market and the growing interest in the market on the part of local and foreign investors." (Eastern Economist)

Foreign trade volume decreases

KYIV - The State Statistics Committee reported that in January-October 1999 Ukraine's total foreign trade volume was $18.532 billion (U.S.), which is a 18.3 percent decrease from the same period of 1998. Exports during this period totaled $9.295 billion, an 11.7 percent decrease, while imports were US $9.237 billion, a 24 percent decrease. Trade operations were conducted with 180 countries. The biggest trading partner was Russia with 20.4 percent of the total export volumes, followed by China, 6.8 percent; Turkey, 5.9 percent; Germany, 4.9 percent; Italy, 3.9 percent; the United States, 3.7 percent; Belarus, 3 percent; Bulgaria, 2.6 percent. The most imports came from Russia with 48.1 percent of the total, Germany, 7.6 percent; Turkmenistan, 5.2 percent; the United States, 3.3 percent; Belarus, 3 percent; Italy, 2.4 percent; Poland, 2.2 percent; and France, 1.8 percent. (Eastern Economist)

Food sector attracts foreign capital

KYIV - Foreign investors in Ukraine have shown the greatest interest in the food industry, with capital of $633.9 million (U.S.). Following this sector are domestic trade at $520.8 million, machinery construction and metal processing at $353.9 million, and construction at $118 million. At the same time, a nine-month summary for 1999 showed declines of $2.1 million in investments in finance, credit and insurance, and $5.9 million in the chemical industry. Foreign investments were made in 7,114 enterprises in Ukraine. The greatest investments made were in enterprises in Kyiv, totaling $992.2 million. Investments made in other regions were $267.2 million in the Kyiv Oblast; $215.3 million in the Zaporizhia Oblast; $204.9 million in the Donetsk Oblast; $173.7 million in the Odesa Oblast; and $170.8 million in the Dnipropetrovsk Oblast. (Eastern Economist)

Shares of Zaporizhia metallurgical plant up for sale

ZAPORIZHIA - The State Property Fund will put up 25 percent of the shares in the Zaporizhia Ferroalloy Plant in stages of 8 percent, 8 percent and 9 percent by June 1. One-fourth of the authorized capital of the enterprise is secured as state property for three years; 13.15 percent of the shares were sold on terms of preferred prepayment, 11.85 percent in certificate auctions and 25 percent in a non-commercial tender. The authorized capital is 74.17 million hrv and the nominal price of a share is 0.7 hrv. The Zaporizhia plant is one of three domestic manufacturers of ferroalloys and has a monopoly on the production of ferro cilium, with a 47.7 percent market share; ferro manganese containing 80 percent coal, with a 100 percent market share; and 90 percent metal manganese, with a 100 percent market share. (Eastern Economist)

One-fourth of the Saliut Hotel is for sale

KYIV - A 25 percent share in the Saliut Hotel was put up for sale in early December in a commercial tender managed by the State Property Fund. The starting price of the package is 304,900 hrv. The tender will take place 30 days after its announcement. In accordance with the terms of the tender, buyers will have to pay off 25 percent of the matured note receivable on the loan granted to the hotel by the Hotel, Tourism and Tours Administration under the city administration within two months, replenish the hotel's current assets in the amount of 45,000 hrv and invest 200,000 hrv over three years for the completion of the underground part of the main hotel complex. (Eastern Economist)

Pfizer sponsors pharmaceutical seminar

KYIV - The volume of sales on the Ukrainian pharmaceuticals market in 1999 dropped by half since 1998 to $500 million (U.S.), stated leading medical specialists of Ukraine at the "Pharmacy XXI: A Look Into the Future" seminar, which was held at the Ukraina Palace of Culture on December 9, 1999. The event was sponsored by the representative office of Pfizer H.C.P. Corp., the leading health-care company in the world, which produces such famous pharmaceutical brands as Viagra and Diflocan. (Ukraine is the leader in Eastern Europe in consumption of Viagra.) The company has been operating in Ukraine since 1992. During this period the company supplied $1.5 million (U.S.) in humanitarian aid to Ukrainian hospitals. (Eastern Economist)

Slovak pharmaceutical company opens office

KYIV - The Slovak pharmaceutical company Galena a.s. opened its representative office in Ukraine on December 14, 1999. Galena is one of the oldest pharmaceutical manufacturers in Europe, operating since 1883. It currently produces 450 different medications. Some of its products have been available in Ukraine for several years now, and one of them, the Novopasit tranquilizer, is extremely popular. Edward Kania, president of Galena, said the company has launched an advertising campaign and plans to aggressively expand in Ukraine in the nearest future. Galena plans to start manufacturing medications in Ukraine, creating additional jobs for Ukrainians. Last year Galena's worldwide sales reached $800 million (U.S.) and these figures keep growing. (Eastern Economist)

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