Road show for investor

ROAD SHOW FOR INVESTOR​

Ducat Asset Management held 3 Road Show for investors – in Dubai, New York, Madrid. Ducat Asset Management presented real estate of various formats – shopping and office centers, premium housing, club houses, multifunctional complexes.

 

The company focused on the potential of the country’s real estate market, the growth of the country’s economy and the attractiveness of investing in the near future. Ducat Asset Management is committed to constant dialogue with existing and potential investors – investment funds, bankers and private investors

 

Ducat Asset Management has extensive experience in asset management, the company provides high standards of service with a focus on the client and is always ready to adapt to his needs.

© 2019 DUCAT

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State Statistics Service: Real GDP growth in Q3 made up 4.2%

STATE STATISTICS SERVICE: REAL GDP GROWTH IN Q3 MADE UP 4.2%

In Q3 2019 real GDP grew by 4.2% as compared to the same period of 2018. Such data were released by the State Statistics Service of Ukraine.

A growing trend was supported by both external and internal demand (consumer and investment). Higher consumer demand was driven by higher wages, stable consumer crediting and improved consumer sentiment.

With regards to production, high growth rates in agriculture have been maintained due to higher yields of certain crops, in particular, sunflower and maize.

Overall, according to the estimates of the Ministry of Economic Development, Trade and Agriculture (basing on data from the State Statistics Service), GDP growth over the 9 months of 2019 made up 3.9%.

Among the main driving factors are as follows:

  • increased purchasing power of the population in conditions of increase of the level of wages against the background of competition for skilled labor by foreign employers (during 9 months of 2019 real wages increased by 9.5%);
  • significant increase in consumer sentiment (according to Info Sapiens in September of 2019 this showing increased up to 97.5 as compared to 62.6 in September of 2018);
  • active consumer lending (according to NBU’s updated information, the volume of loans in national currency to households (except for individual entrepreneurs) increased by 19.3% during 9 months of 2019);
  • preservation of investment activity, which stimulated mainly the development of construction, in particular, of industrial and transport infrastructure facilities (in Q3 2019 – by 19.6% against Q3 2018), including against the background of increase in capital budget expenditures (by 12.3% in Q3 2019 compared to Q3 2018);
  • maintaining the high dynamics of agricultural development in view of heavy crop of cereals and oilseeds and increasing the volume of poultry production in conditions of steadily increasing external demand, as well as improving the situation in hog farming;
  • favorable price situation on selected world commodity markets for domestic exports (according to the World Bank, in Q3 2019 world prices for iron ore increased by 53.1%, maize – by 7.7%;
  • high level of business activity (according to the State Statistics Service, the economic sentiment indicator in Q3 2019 amounted to 9.2% against 5.6% over the corresponding period in 2018 and 6.6% in Q2 2019).

© 2019 DUCAT

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S&P raised its global scale long-term foreign and local currency sovereign ratings on Ukraine

S&P raised its globbal scale long-term foreign and local currency sovereign ratings on ukraine

S&P Global Ratings raised its global scale long-term foreign and local currency sovereign ratings on Ukraine to ‘B’ from ‘B-‘ and its Ukraine national scale ratings to ‘uaA’ from ‘uaBBB’. The Agency also confirmed the short-term sovereign ratings at ‘B’. The outlook is stable.

The stable outlook reflects the agency’s expectation that Ukraine’s new government will preserve the macroeconomic reforms of recent years while the economy recovers and general government debt relative to GDP declines. As a result, Ukraine should retain access to domestic and international capital markets, allowing it to meet commercial debt repayments through 2020.

S&P analysts consider as positive the intentions of the new government to improve business climate and remove a moratorium on sales of agricultural land. The Rating agency also considers these measures could lead to an increase in volumes of foreign investment to Ukraine facilitating economic growth and reducing vulnerability to external challenges.

S&P could consider a positive rating action if there are improvements in growth, fiscal, and external metrics beyond our expectations. Rating agency could also consider raising the ratings if inflation converges toward the NBU’s target, or if credit growth in real terms picks up and capital controls are lifted.

© 2019 DUCAT

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Ukraine’s Credit Rating upgraded from B- to B

Ukraine`s credit rating upgraded from b- to b

Fitch Rating, a global leader in credit ratings and research, has upgraded Ukraine’s Long-Term Foreign and National Currency Issuer Default Ratings (IDR) from “B-” to “B” and improved Outlook from stable to positive.

Fitch Rating notes that Ukraine has demonstrated timely access to fiscal and external financing, improving macroeconomic stability and declining public indebtedness, while a shortened electoral period has reduced domestic political uncertainty. The unity of the new young team of the President, the Verkhovna Rada and the Government, a common position and political will to implement the complex and necessary reforms is among the reasons for the improvement of Ukraine’s position in the ranking.

Expected macroeconomic policy continuity, the new government’s strong stated commitment to structural reforms and engagement with IFIs mean that Fitch expects further improvements in creditworthiness, the report reads.

© 2019 DUCAT

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AIR TRAVEL IN UKRAINE IS INCREASING

Following the devaluation of Ukrainian hryvna in 2013-2015 as a consequence of the Revolution of Dignity, the National Bank of Ukraine has implemented a number of currency stabilizing measures. This includes the requirement for the mandatory sale of 50% of the total sum of foreign currency proceeds from abroad by legal entities and entrepreneurs.

These measures have stabilized the currency, setting it at 26-27 UAH per USD with insignificant fluctuations. Despite continued worries about fluctuations, currently the exchange rate remains close to where it was at the start of 2018. It is helpful to keep in mind that historically speaking, Kyiv real estate prices decrease on a percentage basis far less than the hryvnia during a devaluation. For example, a 20% currency devaluation can translate into a 5% drop in real estate prices. Therefore, if the hryvnia devalues by less than 10%, no significant impact on real estate prices is expected.

© 2019 DUCAT

International support remains strong

International support remains strong

FDI has increased for the first time in three years by 7% compared to 2017, signaling an increase in investor interest. However, it is still far from the peak in 2012, following the outflow of investments in 2013 and 2014. International institutional support for Ukraine is likely to remain strong with increased multilateral lending and technical assistance for Ukraine this year from the IMF, USA, EBRD, and EU.

The head of the EU Delegation in Ukraine, Hugues Mingarelli, at the end of October 2018, said the European Union has provided Ukraine with approximately 10 Bn. EUR in the last four years. The total amount includes both grant aid and loans. On December 18, the IMF approved a new USD 3.9 Bn. program for Ukraine, which will allow it to receive additional foreign aid. At the end of October 2018, the board of directors of EBRD approved a new strategy for Ukraine that defines the priorities of the bank’s activities in the country for the next five years. Currently, there are over 1,500 programs of technical assistance registered with the Ministry of Economic Development and Trade of Ukraine for the total sum of USD 5.4 Bn.

© 2019 DUCAT

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Ukraine integrates into the global economy

UKRAINE INTEGRATES INTO THE GLOBAL ECONOMY

In 2018, Ukraine took several positive steps to increase its economic integration with the global economy and to open up key areas of its economy to foreign investment. One particularly promising example is the energy sector, where Ukraine has begun making strides towards energy independence from Russia. That year included the development of new solar and wind power projects, including those with funding from foreign private equity investors and international financial institutions such as the EBRD.

New support schemes for renewables could come into force as early as next year, which would drive competition and investment in the industry. Trade with the EU has also grown by 60% over the past three years and EU has now become the number one trading partner for Ukraine with a 43% share in the country’s foreign trade turnover.

© 2019 DUCAT

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Ukrainian government in reform mode

UKRAINIAN GOVERNMENT IN REFORM MODE

The Government, which took office following the “Maidan” revolution, has committed to an ambitious and wide-ranging reform agenda. Key reforms undertaken since 2014 include: carrying out significant fiscal consolidation, moving to a flexible exchange rate, reforming energy tariffs and social assistance, enhancing the transparency of public procurement, simplifying business regulations, stabilizing and restructuring the banking sector, adopting a health reform package, moving forward on pension reform, and establishing anti-corruption agencies and asset disclosure for public officials. World Bank has stated that since 2014, Ukraine has done more to improve its business climate than any post-communist country (CEE+CIS).

Another positive shift was evident in the 2019 presidential elections held this April. International supervisors noted that they were clean and democratic with the ruling President Poroschenko defeated by a popular celebrity; the political newcomer Zelenskiy. Zelenskiy, who was inaugurated on May 20, 2019, won his campaign on the promise to fight corruption and continue the European path that was laid out by the people of Ukraine.

© 2019 DUCAT

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