Page 103 - UKRRptDec23

Despite the war, Ukrainian mobile operators are increasing their profits.
Mobile operator Lifecell increased its net profit by 45.5% in July-September 2023 compared to the same period last year - up to ₴555.4M. At the same time, for nine months of the year, mobile operator Vodafone earned a net profit of ₴3.8B – a 600% increase compared to the same period last year.
The NBU is studying the use of central banks' retail digital currencies.The National Bank of Ukraine is exploring the possibility of using retail digital currencies from central banks, or CBDCs, for cross-border operations, the NBU said. As the central bank explained, wholesale settlements between financial institutions are usually for large amounts, such as payments for securities settlements, foreign currency, and interbank settlements. The National Bank has not conducted thorough research on wholesale CBDCs, as it is studying the possibility of using retail CBDCs for cross-border transactions since the retail form of the central bank's digital currency can potentially be used by Ukrainians in the future. This is one of the areas of research in the E-Hryvnia project (the NBU’s digital money) to determine the need to introduce Ukraine's own retail CBDC - the e-Hryvnia. Note that Atlantic Council experts run a CBDC tracker around the world. Therefore, it is known that 130 countries are currently studying the prospects of creating digital currencies for their central banks.
How do Ukrainian startups feel in Ukraine and abroad, and do they plan to return? According to a survey’s results, 31% of startups received investment capital within the last year, and 90% of startups see high growth potential in the future. About 66% of startups assess their current situation positively. Also, 53% of startups believe that the startup ecosystem needs investment from both state and international funds. 81% believe that their products/solutions will help rebuild Ukraine. Also, despite the war, 46% of startups still believe that the ecosystem works at an average level, which can be considered a pretty good result. 46% of startups will remain in Ukraine after the war's end. 33% do not know whether they will leave Ukraine after the war ends, but 21% want to. 47% of startups that left Ukraine will return after the end of the war. At the same time, 59% of startups have not changed their place of residence since February 24, 2022. 66% of startups in Ukraine and 35% abroad need access to investment capital.
Ukraine lost almost $49B in 2016-2022 due to insufficient attention to the crypto industry. Legalization of the crypto industry in Ukraine without additional incentives could generate an amount that is 4.9% of GDP. Since 2016, Ukraine has lost $48.8B in direct income to its population and companies and $10.4B in tax revenue due to the lack of crypto regulations. It is noted that the key lost opportunities are cheap electricity prices during the formative periods of cryptocurrency mining, the lack of investment tools for the population without ties to centralized structures, and the limited liquidity of currency instruments within the country. At the same time, the Ukrainian Parliament proposed regulating virtual asset circulation in Ukraine. The draft law aims to introduce a legal and functional market for virtual assets in Ukraine and determine the rules for their taxation. According to the document, taxpayers must independently determine the final gains or losses and reflect them in their tax returns.
Microsoft to provide free cloud services to Ukrainian government for another year. So far, Microsoft has provided Ukraine with $540 million in free services, technical support, equipment, and grants, Digital Transformation
103 UKRAINE Country Report December 2023 www.intellinews.com