EBA meeting with the Minister of Infrastructure of Ukraine

08/ 04/ 2020

On April 7, the European Business Association had a special live meeting with Vladyslav Kryklii, Minister of Infrastructure of Ukraine. Thus, there was a discussion on the infrastructure, cargo traffic, rail transportation, seaports, etc.

Special focus was given to the issues regarding the appointment of heads of the state-owned enterprises, which are under the authority of the Ministry of Infrastructure. So, as of today, those enterprises of strategic importance were left without the leadership (Ukrzaliznytsya, Ukrainian Sea Ports Authority, Maritime Administration). Vladyslav Kryklii noted that the appointment of the head of Ukrzaliznytsia was suspended due to the quarantine. Probably the same applies to the Ukrainian Sea Ports Authority. The selection of the head of the Maritime Administration will also be scheduled after the quarantine. At the same time, the business urged to adopt promptly the financial plans for these strategic enterprises without cutting the investment components. Thus, the business was informed that the financial plans for these enterprises are in the final stage of approval.

Moreover, the issues were raised regarding the Pilot project on private traction (its launch was supposed to be prior to April 1, 2020), namely its execution period and the calculation of the transportation cost for the part of the route where private locomotives are used. According to the Minister, these issues will be resolved by a Special Commission, which will shortly have its first online meeting. Furthermore, another task of the Commission is to ensure proper tariffication.

It was important for the business community to hear from the Ministry that the so-called “low-activity” railway stations will continue their operations. As they are considered as a support for small and medium-sized enterprises, the closure of such stations is not planned. Thus, stations continue their operations without any additional financial burden.

There were several questions concerning the operation of ports. It was reported that the issue of entering the port of Odesa should be finally resolved by the end of the year. Thus, several solutions to the problem are being considered at the moment (for example, to build a bypass road or to give a state status to an existing road).

Also, it is planned to attract additional investors to ports and other hubs for this year. It proves that Ukraine is increasingly gaining weight as an important container shipping player. In addition, the business was informed that the development of container transportation will continue, as well as the development of multimodal terminals and the creation of special hubs.

Regarding the Methodology of Calculating Port Tariffs, the Minister informed that the respective council was established and that the respective project would be made public on the Ministry’s website for public consultation in the near future.

At the same time, three ports (Skadovsk, Ust Dunaisk, Bilhorod Dnistrovsk) are developing public-private partnerships. Besides the investments in seaports in the various forms of PPP, the issues of investment compensation, direct air connection with China for the development of air cargo, etc. were also discussed.

The business was also interested in the current situation regarding the Draft Law on NTRC (National Transport Regulation Commission), which was withdrawn on March 04. Thus, now the development of the updated Draft Law continues. At the same time, since it was initiated by the Government, it is necessary now to have a re-approval. The comments and suggestions from EBA are currently being considered by the Antimonopoly Committee. It was agreed that the representatives of the business community would be involved in the preparation of the draft law.

At the same time, given the pandemic, on March 23, the Government made a resolution to enable the delivery of medicines with Ukrposhta. Such an option will be available during the quarantine period and, if proved successful, the implementation of such a mechanism will be considered in the future. However, given that this method of delivery is a violation of license terms, the business is waiting for an official document to understand how to ensure the provision of medicines to the public.

In addition, there was a discussion of some issues directly related to business activities, such as increased rates for container transportation, employee transportation to work, etc.

The European Business Association is grateful for the professional dialogue and willingness of the authorities to listen to the business. The business community has already shared its concerns with the Ministry and will keep in touch to promptly inform on issues important to companies and provide quality feedback on all initiatives.

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