BUSINESS IN BRIEF (04/30/00)

BUSINESS IN BRIEF

State Property Fund puts Air Ukraine up for sale

KYIV - The State Property Fund confirmed plans to put shares of Air Ukraine up for sale. The sale of 25.22 percent is subject to privileged subscription. Of those, 16.55 percent goes to employees, 3.67 percent to individuals with acquisition rights on privileged terms and 5 percent to management. Moreover, 51 percent of the shares will be put up for commercial tender and 23.78 percent on the stock exchange in the third quarter of this year. (Eastern Economist)

Crimea is hot spot for foreign investors

SYMFEROPOL - The volume of foreign direct investments into the Crimean economy as of January 1 was $132.7 million (U.S.), according to a statement by Crimean Council of Ministers press service. A total of 138 Crimean companies received foreign investment totaling $22.2 million (U.S.). In 1999 $5.9 million of that amount came in to Crimea. 72.3 percent of all foreign direct investments was in the healthcare sector, 6.6 percent in the fuel industry and 3.2 percent in the construction sector. An overwhelming 73.8 percent of investments came from the CIS and Baltic countries, including 59.8 percent from Russia. The greatest activity was recorded in Yalta, 69.3 percent, and Symferopol, 17.3 percent. There are 98 joint ventures operating in Crimea, with $100.6 million (U.S.) of foreign investment. (Eastern Economist)

Machine-building trade union losses

KYIV - In the last five years the number of people employed in the machine-building sector dropped by 90,000; and 35 percent of employees are on unpaid vacations, stated Machine Builders Trade Union Chairman Anatol Kurbatchenko. The average wage in the sector is only 200 hrv, which is lower than the average monthly wage in the industrial sector. In the last five years the number of members of the trade union decreased 42.9 percent; the union currently has 120,000 members. (Eastern Economist)

Didenko appointed chairman of NaftoHaz

KYIV - The government on April 7 appointed Ihor Didenko, first vice-chairman of NaftoHaz Ukrainy, as the company's acting chairman of the board. National Deputy Vasyl Koshynets, a member of the Revival of the Regions faction, became first vice-chairman. Prior to his election to Parliament, he was head of the Dolyna Raion administration. The government earlier dismissed NaftoHaz Ukrainy Chairman Ihor Bakai, and his first vice-chairman, Taras Freiuk. (Eastern Economist)

Swedes to take over Boryspil cereal plant

KYIV - Swedish food manufacturer Cerealia Breakfast Cereals announced the takeover of the Boryspil cereal plant on March 29, considerably strengthening its position in Eastern Europe. The Boryspil cereal plant will produce cereals, muesli, pasta and oat-based breakfasts for the domestic market. In time the plant will produce foodstuffs for markets in Russia and the Baltics. The company, which plans to regularly launch new products, will buy raw materials in Ukraine. The company will upgrade the existing facilities and install new production lines to allow the distribution of all products in Ukraine. (Eastern Economist)

First coal well drilled in Taihyliv field

NEW YORK - The U.S. company Eurogas Inc. announced in a recent press release that it had finished drilling the first coal methane well at Taihyliv-1 field situated in the Volyn coal field. According to Eurogas, the well is 830 meters deep. Drilling results show that gas can be found there, not only in coal seams but also in sandstone, which is coal-related and helps build up a natural gas reservoir. The company plans to run tests of gas flow and pressure in the field. If the results are positive, two more wells will be drilled there. The Eurogas corporation, which owns 70 percent of the concession at Taihyliv field, operates jointly with the state-run company ZakhidUkrHeolohiya. Besides Ukraine, the U.S. company also controls gas concessions in Poland and has joint ventures prospecting and producing gas and oil in Canada, Poland, Slovakia and the Republic of Sakha-Yakutia in Russia. (Eastern Economist)

Ukrainian food and beverage exhibition held

KYIV - Produkty Ukrainy 2000, a national exhibition, was held April 11-14 in the ACCO exhibition center. About 80 Ukrainian companies representing food production, information and packaging services for food processors, as well as beverage and confection manufacturers presented their goods at the exhibition. Most of the participants expressed satisfaction with the exposure of their companies and products to the public. (Eastern Economist)

Export of domestic tobacco increases

KYIV - Tobacco companies in January through October increased cigarette exports by 100 percent, reaching 6 billion cigarettes worth $41.8 million (U.S.). In January through October of 1998, tobacco companies exported nearly 3 billion cigarettes for $19.8 million (U.S.). Most exported cigarettes were produced by the Kyiv and Cherkasy factories, owned by Reemstma. During the first 11 months of 1999 , domestic tobacco factories produced 49.19 billion cigarettes. The capacity of the domestic market is estimated to be 75 billion cigarettes. Imported cigarettes in January through October fell by 60 percent, or by 4.35 billion cigarettes, compared to the same period last year, to 2.847 billion worth $32.9 million. The UkrTiutiun tobacco lobby says that the decline of officially registered imports only proves that contraband cigarette imports are on the rise. (Eastern Economist)

Russian-Ukrainian airline to receive U.S. loan

WASHINGTON - The U.S. ExImBank on March 29 agreed to extend a $1.5 million loan to the Russian-Ukrainian joint venture Volga-Dnipro Airlines. The money is earmarked for the purchase from Honeywell of 11 installations of equipment to prevent air collisions. Volga-Dnipro Airways is involved in long-range air cargo shipments using Ruslan AN-124-100 planes. The airline operates mainly in the United States, providing services for Boeing, Lockheed Martin, GE Aircraft, Space Systems/Loral and Caterpillar. (Eastern Economist)

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