Page 16 - UKRRptMar20

4.3​ Fixed investment
Capital investment in Ukraine increased 15.5% y/y in 2019​, slightly slowing from 16.4% y/y in 2018, the State Statistics Service reported on February 24.
In particular, industrial capital investments rose 34.7% y/y​ while capital investments in agriculture dropped 10.0% y/y.
The majority of capital investment was channeled to machinery and equipment (34.0%)​, engineering facilities (22.6%) and nonresidential buildings (15.4%). The major source of investment financing was companies’ own funds (68.1%). Local and state budgets funds made up 9.6% and 5.0% of total investment, while bank and other loans financed 7.0%.
Capital investment is growing fast, but the volume of investment is not sufficient to make the drastic changes in Ukraine’s economic structure that would help to reach a breakthrough in economic growth. Companies’ own funds remains the major source of investment while the access of Ukrainian companies to bank loans remains low due to high interest rates and the overall high risk of the economy.
Capital investments in Ukraine’s agriculture sector decreased by 16% in 2019,​ reports the Ukrainian Club of Agrarian Business. "The decrease in capital investment in 2019 was caused by two key factors: the revaluation of the hryvnia and the expectations of the opening of the land market," said the club’s press service.
As the q/q chart below clearly shows fixed investment is rising every year, but it is still not rising at a level needed to dramatically transform the economy.
16​ UKRAINE Country Report​ March 2020 ​ ​www.intellinews.com