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budget deficit not exceeding 3.5% of GDP.
On March 1, the Ministry of Finance of Ukraine repaid the ninth coupon on eurobonds, the ministry has told Interfax-Ukraine. According to the Ministry of Finance, the total payment amounted to $335 million. As reported, these eurobonds were issued as part of a debt operation conducted by Ukraine in 2015 with state and state-guaranteed debt, as well as the restructuring of foreign borrowings of Kyiv, the State Agency of Automobile Roads of Ukraine (Ukravtodor) and Pivdenne (Yuzhnoye) Design Bureau (Dnipro). The interest rate on all these securities was set at 7.75% per annum. Interest income is accrued and paid twice a year on March 1 and September 1, starting from March 1, 2016. The repayment period of eurobonds is September 1 of the respective year from 2019 to 2027.
To develop Ukraine’s small and medium-sized enterprises, the European Investment Bank is ready to allocate €700mn in loans, Prime Minister Shmyhal told the Rada Friday. “Loans with a zero rate -- 0.12% per annum -- to support small and medium enterprises in Ukraine,” he said during Question Hour. Separately, Jean-Erik de Zagon, the EU bank’s representative in Ukraine, told the UBN Friday, that €800mn had been allocated to Ukraine 2015, but only €100mn had been disbursed. Now, there will be push to extend small business loans, in hryvnias, through half a dozen banks here.
6.1.4 Budget dynamics - privatization
To speed up privatization of Ukraine’s 3,500 state companies, Mikheil Saakashvili’s Office of Simple Solutions and Results has sent to the Rada a package of bills that would deprive courts of the power to freeze sales, to give local communities 30% of sales proceeds, and to channel all other sales proceeds to improving state services. By creating these incentives, Saakashvili argues in a Kyiv Post opinion piece, Ukraine will find the will to cut the state companies which cost the Treasury $6.1bn a year. He wrote that Ukraine has 63 times more state companies than Poland and 76 times more than Sweden.
Ukraine harbors significant reserves of non-ferrous and rare-earth metals
including unique deposits of beryllium, zirconium, tantalum, and a complex of phosphoric rare-earth and rare-metal ores, reports MiningWorld.com. “Ukraine’s confirmed reserves of lithium are the largest in Europe. The country also has a real opportunity to enter the global market with pure and ultra-pure metals such as gallium, indium, thallium, lead, and tin...Ukraine just needs to harness its mineral resources to thrive. For this to happen, new technologies and large investments are needed.”
With China accounting for 80% of rare-earth imports into the US, Ukraine could benefit from Washington’s growing nervousness about supplies, mining experts say. Rare earths are essential for production of goods ranging from smart phones to fighter jets. “China is exploring whether it can hurt US defence contractors by limiting supplies of rare-earth minerals that are critical to the industry,” the Financial Times reported. Chinese rare earth producers told the FT that Chinese government officials had asked them how badly US and EU companies would be affected if China restricts rare-earth exports during bilateral disputes. Earlier, Bloomberg outlined the threat in a lengthy report: “How China Overpowered the US to Win the Battle for Rare Earths.”
35 UKRAINE Country Report March 2021 www.intellinews.com
