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The latest property of state alcohol producer Ukrspyrt was sold at auction on December 23 for $2mn, almost double the asking price, reports the State Property Fund. With almost half of Ukrspyrt’s 41 properties now sold, the Fund calculates that the state will net $70mn from the privatization. Starting next July, the only way a private investor can start new alcohol production in Ukraine is to produce from a property privatized from Ukrspyrt.
The Cabinet of Ministers decided on December 16 to transfer 18 enterprises of the UkrOboronProm defence conglomerate to the State Property Fund for privatisation. With a total value listed at $10mn, the companies are expected to be sold largely for their scrap metal and real estate. Of the 18 companies, 11 no longer function. Five lost a total of $530mn during the first half of this year. A legacy of the Soviet military industrial complex of the 1980s, the list includes such entities as the Vinnytsia Aviation Plant, the Zakarpattia Helicopter Production Association, and the Lviv Radio Engineering Research Institute.
In the first half of next year, the State Property Fund plans to start the privatization of the United Mining and Chemical Company, the First Kyiv Machine-Building Plant (formerly Bolshevik), and stakes in six regional power companies, the head of the Fund, Dmytro Sennychenko, said on December 17 at the Ukrainian Investment Roadshow. Last spring, the Rada suspended all major privatization auctions after coronavirus restrictions shut down almost all air travel. Sennychenko said he expects the Rada to lift the ban this spring.
Ukraine plans to transfer all of the nation’s seaports to concessions or private ownership by 2025, Infrastructure Minister Vladyslav Krikliy told an online international investment conference Friday. Noting that concession contracts with foreign investors were signed this summer for two ports – Olbia and Kherson – he said that next in line for concessions are the rail, ferry and container terminals of Chornomorsk and the passenger terminal at Odesa port. Next will be concessions of Berdyansk, on the Azov, and Izmail, on the Danube. The Ministry is preparing to sell outright three small ports: Belgorod-Dniester, Ust-Dunaisk and Skadovsk.
6.2 Debt
Ukraine’s state and state-guaranteed debt rose 1.1% m/m to $84.2bn as of November 30, the Finance Ministry reported on December 25.
State domestic debt jumped 1.2% m/m to $31.8bn, while state foreign debt inched up 0.8% m/m to $42.3bn. State-guaranteed debt increased 2.9% m/m to $10.2bn.
In UAHterms, overall state debt gained 1.3% m/m in November to UAH2,398bn, or 60.3% of Ukraine’s GDP in 2019.
“The state domestic debt increased in November as the receipts from the newly placed local bonds exceeded the volume of redeemed bonds. The increase in state foreign debt was mostly due to European Investment Bank financing of €440mn disbursed for infrastructure projects in eastern Ukraine,” Evgeniya Akhtyrko of Concorde Capital said in a note. “Ukraine’s state debt will pick up significantly in December, given the skyrocketed last-minute placements of local bonds, the tap issue of Eurobonds for $600mn and the
38 UKRAINE Country Report January 2021 www.intellinews.com
