Ukraine: Daily Briefing – August 1, 2018, 5 PM Kyiv time

Ukraine: Daily Briefing
August 1, 2018, 5 PM Kyiv time
 
1. Russian Invasion of Ukraine
Ukraine’s Ministry of Defense reported at 12:30 PM Kyiv time that in the last 24 hours, no Ukrainian soldiers were killed and one Ukrainian soldier was wounded in action. In the last 24 hours, Russian-terrorist forces opened fire on Ukrainian positions on the Luhansk and Donetsk sectors of the front 36 times in total. Returning fire, Ukrainian forces killed 2 and wounded 6 enemy combatants in the last 24 hours.
2. One year since Canada-Ukraine Free Trade Agreement came into force
The Canada-Ukraine Free Trade Agreement (CUFTA) came into force on August 1, 2017. Ukraine’s Ministry of Economic Development and Trade reported that in in 2017 Ukrainian exports to Canada grew by 74.4%. In the first five months of 2018, Ukraine’s exports to Canada grew 37.1%.
3. Good things are happening in Ukraine, even if they don’t make the headlines
Writing for the Atlantic Council, Tim Ash stated, “Ukraine just got a big win. On July 25, the International Monetary Fund signalled its support for Ukraine’s amended plans to create an Anticorruption Court. The Rada passed the original bill in June and amended it on July 12 to address concerns subsequently raised by the IMF.
Approval of an IMF-compliant bill is a major victory for anticorruption campaigners. The hope is that there will be a sea change in reining in corruption, something which business surveys, and indeed general surveys, identify as the number one reform priority. And it is critical to securing domestic and foreign investment and to pushing growth beyond the current 3 percent trajectory.
Analysts and experts expect the Poroshenko administration to quickly constitute the Anticorruption Court and make it operational by the year’s end or, at least before the March 2019 presidential election.
The battle for approval of the Anticorruption Court has become a key indicator of the Ukrainian authorities’ willingness to address corruption. But the epic battled has lasted for more than a year, and it has overshadowed other good news stories elsewhere on the reform front, and there have been numerous wins.
A new privatization law passed in January considerably simplifies the process, triaging the various state assets into those to be sold, those retained and restructured, and those to be wound down. […]
            The passage of a new law on foreign currency regulation this summer is major step forward. The previous law dates as far back as 1993 and is simply not fit for purpose. […]
            More broadly, the NBU has conducted monetary policy in a credible and orthodox way with a smooth and faultless transition to the new governor, Yakub Smoliy. The furthering of the NBU’s institutional strength is also one of the big reform wins for 2018. The NBU is now a highly competent and credible institution-a night and day transformation four years after the Euromaidan.
In the area of banking sector reform, a new law on state bank governance approved on July 5 opens the way for the creation of independent supervisory boards at state-owned banks which, after the nationalization of Privatbank, constitute over 50 percent. […]
            An independent supervisory board has already been created at the state railways, and similar independent boards are a work in progress at the Ukrainian postal service and Ukrenergo, which are similarly important in improving the efficiency of public institutions likely to remain in state ownership as strategic assets. […] Energy sector reform is ongoing and while the media focuses on the government’s refusal to increase gas prices as it agreed to with the IMF in March 2017, that’s not the whole picture. Naftogaz’s independent supervisory board has agreed to an unbundling plan for the energy sector to be implemented in 2020. This should be a priority for the next administration, and is critical to maintaining the reform wins in the energy sector.
These are just some of the reform successes this year; the list also includes healthcare, deregulation and improvements in the business environment, simplification of customs procedures, and protection of creditor rights. It is important to give credit where credit is due to the many reformers still fighting the good fight in Ukraine and to highlight these lesser-known wins.”
4. Ukraine to boost grains production with eyes on China
Reuters reported, “Ukraine is aiming to boost grains and oilseed exports to China as rising consumption and trade tensions between Washington and Beijing create new opportunities, a senior industry official said on Wednesday. […]
            ‘The Chinese market is very important to Ukraine. We see big potential for our grain and oil products in China,’ Nikolay Gorbachov, president of the Ukrainian Grain Association told Reuters in an interview. ‘The first reason is China’s consumption to rising, and the second is the trade war with the United States.’
            Gorbachov, who is due to speak at an industry conference in Melbourne, said he expects Ukraine’s exports of all grains to rise to 55-65 million tonnes in the next three to five years, up from around 45 million tonnes in recent years.”

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