Print Investment activity in Ukraine

According to the National Bank of Ukraine, the volume of foreign direct investment in the economy of Ukraine (balances) as on March 31, 2021 amounted to 51,785.4 mln. US dollars.

Inflows of the direct investment (equity instruments) in Ukraine in the I quarter of 2021 amounted to 379.0 mln. US dollars.

The investments are directed to already developed spheres of the economic activity.

As on March 31, 2021, the most significant volumes of the direct investments (balances) were directed to the industrial enterprises - 42.3 percent, and the institutions and organizations engaged in wholesale and retail trade, repair of motor vehicles and motorcycles - 15.8 percent.

The main investor countries are Cyprus - 26.3 percent, the Netherlands - 22.8 percent, Switzerland - 8.2 percent, the United Kingdom - 4.6 percent, Germany - 4.5 percent, Austria – 3.1 percent, Luxembourg - 2.2 percent, and France - 2.1 percent.

The volume of assimilation of the capital investments of Ukrainian enterprises in January-March 2021 amounted to 78,178.5 mln. UAH. The capital investment index is 90.5 percent as to the corresponding period of the previous year.

In terms of capital investment, in January-March 2021 the leading fields of the economic activity are: industry - 39.7 percent, construction - 10.9 percent, agriculture, forestry and fisheries - 11.2 percent, information and telecommunications - 4.7 percent, wholesale and retail trade; repair of motor vehicles and motorcycles - 7.6 percent, transport, warehousing, postal and courier activities - 8.2 percent, public administration and defense; mandatory social insurance - 4.1 percent, and real estate transactions - 5.0 percent.

The main source of financing of capital investments is still the equity capital of the enterprises and organizations, from which 78.2 percent of investments were assimilated in January-March 2021.

The share of the bank loans and other credits in total investments was 4.8 percent.

At the expense of the state and local budgets, 7.3 percent of capital investments are assimilated. The share of foreign investors was 0.2 percent of all investments, and the share of funds of the population for housing construction was 6.6 percent. Other sources of funding are 3.0 percent.

In the Doing Business 2020 rating, the Ukraine’s ranking rose by +7 points and took 64th position among 190 countries. The greatest progress was demonstrated by the component “protection of minority shareholders” +27 points and the component “obtaining a building permit” +10 points.

The international rating agency Moody's Investors Service increased Ukraine's sovereign credit rating to B3 with a stable outlook. Ukraine has risen in the rating of long-term issuer and priority unsecured liabilities of the Government after signing a new Stand-by program with the IMF.

In March 2021, the Standard & Poor's reaffirmed Ukraine's long-term and short-term foreign and domestic currency ratings at B/B level. The forecast is stable.

In February 2021, the international rating agency Fitch Ratings reaffirmed Ukraine's long-term credit rating (IDR) in foreign and national currencies at “B” level. The forecast is stable.

In the direction of public-private partnership (PPP), the following main results were obtained:

Firstly, the legislation is improved.

The Law of Ukraine On Concession No. 155-IX, dated 03.10.2019) is developed to reform the concession legislation, harmonize the legislation on concessions with the legislation on PPP, implement the basic principles of concessions and PPP in accordance with EU law, and regulate all aspects of the concession activities.

In addition, 25 legislative acts were amended, including the Law of Ukraine On Public-Private Partnership, in order to ensure a system approach to regulating the involvement of private business in the implementation of PPP projects in all areas of the business activity.

Secondly, the holding of the first concession tenders in the port infrastructure was a positive signal in the development of infrastructure. In 2019, the Government of Ukraine held concession tenders in the seaports of Olvia and Kherson, as a result of which the concession agreements were concluded.

In addition, the Government approved a list of priority investment projects for the state until 2023, of which 40 percent are the large-scale projects in the field of infrastructure and almost all sectors of transport. This list includes the construction of a new airport in Transcarpathian region and the reconstruction of 13 more regional airports.

In the road sector, the implementation of potential PPP pilot projects (for 6 of which the concept notes have already been prepared) is provided for under the First PPP program in the road sector.

In the railway industry, the concession projects for railway stations are provided.

Work is also continuing on preparation of promising PPP projects in the port infrastructure (the project of the concession of the railway-ferry complex of the State Enterprise “Sea Commercial Port “Chornomorsk” as part of the fifth terminal of the State Enterprise “Sea Commercial Port “Chornomorsk” and the property of the State Enterprise “Ukrainian Sea Ports Authority” at the seaport “Chornomorsk”; the project of the concession of the container terminal of the State Enterprise “Sea Commercial Port “Chornomorsk” together with berths No. 1-6 of the Chornomorsk branch of the State Enterprise “Ukrainian Sea Ports Authority”).

The third important area is the functioning of the State Organization “Agency for Support of Public-Private Partnership” (hereinafter referred to as the PPP Agency).

Another mechanism for attracting investment is industrial parks - these are potential industrial sites for relocation of companies from other countries in order to diversify supply chains, addressing the reduction of time to start work (Time-to-Market) of the companies, taking into account the time required to find the optimal location, commencement of construction and commissioning of the facilities.

Today, 51 industrial parks are already included in the Register of Industrial Parks, 25 of them have management companies, and 8 have participants.

In addition, in order to implement an effective mechanism for attracting foreign investment and supporting the investment development of Ukraine, there is a State Institution “Office for Attracting and Supporting Investments” (hereinafter referred to as the Office).

The Regulations on the Office were approved by the Order of the State Secretary of the Cabinet of Ministers of Ukraine dated 23.04.2018 No. 76, as amended by the Order of the State Secretary of the Cabinet of Ministers of Ukraine dated 20.05.2021 No. 63.

The detailed information about the Office and its activities, as well as possible ways of cooperation on projects is available at: https://ukraineinvest.com/.

In addition, the Office has formed an investment atlas, which contains investment proposals from various departments and regional authorities, and prepared UkraineInvestGuide, a universal guide for the foreign investors on investment potential in various sectors of the Ukrainian economy. The documents are available at https://ukraineinvest.com/life-in-ukraine/invest-atlas/, https://ukraineinvest.gov.ua/uk/guide/.

In order to stimulate the attraction of strategic investors in the economy of Ukraine, increase the investment attractiveness of Ukraine, as well as increase the competitiveness of the economy through the introduction of state support for large investment projects, the Law of Ukraine On state support of investment projects with significant investments in Ukraine (No. 1116-IX dated from 17.12.2020) came into effect on February 13, 2021.

In addition, the Laws of Ukraine On Amendments to the Tax Code of Ukraine on Specifics of Taxation of Business Entities Implementing Investment Projects with Significant Investments in Ukraine (No. 1293-IX dated 02.03.2021) and On Amendments to paragraph 4 of Section XXI “Final and Transitional Provisions” of the Customs Code of Ukraine on exemption from import duty of new equipment and components imported for the implementation of an investment project with significant investments to implement a special investment agreement (No.1294-IX dated 02.03.2021).

In order to implement the provisions of the Law of Ukraine On state support of investment projects with significant investments in Ukraine, the following regulations were adopted:

  • Order of the Cabinet of Ministers of Ukraine dated 17.02.2021 No. 133-p “On determining the authorized institution to support the applicant and the investor with significant investments in the preparation and implementation of the investment project with significant investments”. The state institution “Office for Attracting and Supporting Investments” has been designated as the authorized institution.
  • Resolution of the Cabinet of Ministers of Ukraine dated 19.05.2021 No. 515 “On approval of requirements for feasibility study of an investment project with significant investments”.
  • Resolution of the Cabinet of Ministers of Ukraine dated 23.06.2021 No. 648 “On approval of the requirements for the applicant regarding financial capacity for the implementation of an investment project with significant investments”.
  • Resolution of the Cabinet of Ministers of Ukraine dated 23.06.2021 No. 647 “On approval of the Procedure for interaction of the authorized institution with applicants, investors with significant investments, public authorities, and local governments on issues related to the preparation and implementation of the investment projects with significant investments” .
  • Resolution of the Cabinet of Ministers of Ukraine dated 07.07.2021 No. 714 “On approval of the methodology for calculating the amount of state support for the implementation of an investment project with significant investments”.
  • Resolution of the Cabinet of Ministers of Ukraine dated 28.07.2021 No. 819 “On approval of the Procedure and methodology for evaluating an investment project with significant investments”.
  • Resolution of the Cabinet of Ministers of Ukraine dated 04.08.2021 No. 805 “On approval of the Procedure for maintaining the register of investment projects with significant investments and the List of information included in the register of investment projects with significant investments”.

 

 

 

 

 


http://freegeoip.net/json