Boryspil Airport is being tidied up
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The Japanese government resolved that JPIC give Ukraine a loan for 19.092 billion yen (about $172 million) to revamp Boryspil Airport to build a new terminal to increase the passenger capacity. It is a 30-year-term loan with a 10 year grace period at 1.5% annual interest rate.
If this project is effectively implemented, the Japanese government will issue further loans to help Ukraine finance several other projects, particularly construction of a bridge spanning the Buh River in Mykolayiv, cleansing the polluted waters in Kryvy Rih (Dnipropetrovsk oblast), and building power plants in Cherkasy and Dnipropetrovsk.
In fact, Japanese companies are not the only ones willing to take part in the Boryspil Airport upgrading projects. Alongside the said loans, Ukraine's largest air carrier Aerosvit has started building its own Passenger Terminal D - to be entered into the balance sheet of Aerosvit Terminal, an affiliate with a 100% interest in the parent company, to be made up of several structures, including the terminal proper, a passenger tunnel, a high-rise parking lot, and an entrance overpass.
The new project's passenger capacity will rise to some 3.5 million a year. The project costs $80 million. The Ukrainian company will cover 30% and the rest will be financed by loan capital.
The EBA Goes Regional
During the course of this year the EBA has opened regional offices around Ukraine and there are now functioning offices in Kharkiv, Donetsk and Lviv. These offices offer support to the local offices of companies with a national network but where the head office in Kyiv actually joined while for companies based in these cities it offers the opportunity to join and receive the benefits of being a member of the European Business Association.
These local offices are now organizing their own business and social meetings. Meeting the demand of the Ukrainian business community the EBA has also opened a regional office in Odessa on October 22nd.
Stable ratings
The Institutional Investor's chronicle which enjoys a well-deserved popularity in financial circles, published world national ratings, showing that Ukraine is six points up in the first half year - from the 86th to the 80th slot. Fitch says Ukraine has B+, meaning stable, Moody's says it is B1, 'positive,' and S&P also indicates B+ (positive).
The above three agencies' ratings are precisely what determines the cost of Ukraine's state borrowings/loan in foreign markets. It is very simple formula: the higher the rate, the better are the opportunities for Ukraine to acquire loans at lower rates of interest. Over the past six month, the said agencies' ratings have remained the same, although one could have expected a drop, due to the presidential election date approaching and considering all the associated risks. The reason the ratings stay stable is that the market for raw material remains relatively favorable, and because Ukraine's state finances also remain more or less stable. If the presidential campaign has a smooth outcome, the foreign market situation will remain favorable, provided the Ukrainian parliament passes the 2005 budget bill more or less on time. In that case, one could expect Fitch, Moody's and S&P ratings to rise somewhat.
The Ukrainian 5/2004
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