Embassy of Ukraine in the United States of America

, Kyiv 23:54

The investment climate in Ukraine

The creation of favorable development conditions for the business climate in Ukraine remains one of the most urgent task. The amount of foreign direct investment (equity) in the economy of Ukraine on 1st of July 2015 totaled USD 42851,3 million and  1000,5 USD per capita (excluding the temporarily occupied territory of the Autonomous Republic of Crimea, Sevastopol and the part of the zone of counter-terrorist operations). 

From January to June 2015 the foreign investors invested USD 1042,4 million in Ukraine, and took out 351,3 million USD of direct investments (share capital). Reduction of the share capital cost due to reassessment, losses and requalification amounted 3604,0 million USD, including USD 3539,3 million lost due to exchange rate difference.

In the year 2015 the investments floated from 133 countries. The EU countries made USD 33154,9 million of the investments (77.4% of total share capital), the other countries of the world scored USD 9696,4 million (22,6%). More than 83% of direct investments accrue to ten major countries-investors: Cyprus - 12274,1 million USD, Germany – 5489,0 million USD, the Netherlands – 5108,0 million USD, Russia – 2685,6 million USD, Austria – 2354,3 million USD, UK – 1953,9 million USD, the British Virgin Islands – 1872,6 million USD, France – 1539,2 million USD, Switzerland – 1371,2 million USD and Italy - 966,6 million USD.

At the same time the amount of Ukrainian direct investments (share capital) to the foreign countries economies on the 1 of July 2015 totaled 6254,4 million USD, including the EU countries-  6015,4 million USD (96,2%),  and other countries of the world - 239,0 million USD (3.8%). Direct investments from Ukraine were injected to 46 countries around the world, mostly to Cyprus (93,0%).

The requirements of the Ukrainian direct investors for the debt instruments to the enterprises of direct investment abroad made up 218,0 million USD on 1 July 2015. The amount of direct investments (capital share and debt instruments) in the economy of the countries of the world totaled 6472,4 million USD.

 

Direct foreign investment inflow

(million USD)

 

Total

including from

EU countries

other countries

Non-residents direct investments (share capital and promissory instruments) on the 1st of January 2015

54070,7

42789,5

11281,2

Non-residents joint stock on the 1st of January 2015

45764,2

35603,9

10160,3

Non-residents joint stock inflow

1042,4

419,8

622,6

Non-residents joint stock outflow

–351,3

–222,2

–129,1

Other changes of the non-residents joint stock value (change of cost, loss, reclassification of investments and others)

–3604,0

–2646,6

–957,4

difference in rate

–3539,3

–2773,0

–766,3

Non-residents joint stock on the 1st of July 2015

42851,3

33154,9

9696,4

Promissory instruments (debt on credits and loans, liabilities for trade credits and other liabilities to direct investors)

 

 

 

on the 1st of January 2015

8306,5

7185,6

1120,9

on the 1st of July 2015

8850,4

7609,1

1241,3

Non-residents direct investments (share capital and debt instruments) on the 1st of July 2015

51701,7

40764,0

10937,7

 

Direct foreign investment outflow

(million USD)

 

Total

including from

EU countries

other countries

Residents direct investments abroad (share capital and promissory instruments) on the 1st of January 2015

6562,7

6239,7

323,0

Residents joint stock in the economy of the world countries on the 1st of January 2015

6350,7

6033,3

317,4

Residents joint stock inflow

26,4

0,0

26,4

Residents joint stock outflow

–81,4

–1,9

–79,5

Other changes of the residents joint stock value (change of cost, loss, reclassification of investments and others)

–41,3

–16,0

–25,3

difference in rate

–40,9

–16,0

–24,9

Residents joint stock in the economy of the world countries on the 1st of July 2015

6254,4

6015,4

239,0

Promissory instruments (requirements after credits and loans, trade credits, and other requirements to the enterprises of the direct investing)

 

 

 

on the 1st of January 2015

212,0

206,4

5,6

on the 1st of July 2015

218,0

207,5

10,5

Residents direct investments abroad (share capital and promissory instruments) on the 1st of July 2015

6472,4

6222,9

249,5

During 2014-2015 the Ukrainian government implemented a set of measures to create a whole new level of business environment, which is to provide economy revival and steady development in Ukraine.

Owing to this fact, In the World Bank rating Doing Business 2015»  according to the indicator of the easiness of doing business, Ukraine occupies 96 position among 189 countries of the world (112-in 2014).

Legal framevork for investment and development of private-state partnership is set up in Ukraine. The legislation of Uktaine determines the guarantees for investors activity, economic and organizational foundation for the realisation of private-state partnership.

National regulations of investment activity are implied on foreign investors on the territory of Ukraine, equal bussiness conditions with local invesrors are granted. Foreign investments are not subjected to nationalization.

In case of shut down of investment activity foreign investor is guaranteed return on investment in its genuine form or in the currency of investment, tax free as well as revenues from the investment in monetary or commodity form. The state also guarantees unhampered and immediate abroad transfer of revenues and other funds in foreign currency legally obtained due to foreign investmens.

To enhance the protection of foreign investments the Washington Convention of 1965 on the Settlement of Investment Disputes between States and Nationals of Other States was ratified by the Law of Ukraine No. 1547 addopted on 16 of March 2000.

The Commissions for the assistance on the pre-trial settlement of disputes with  investors that might be created by the executive authorities and local authorities as a temporary advisory consultative bodies to facilitate pre-trial settlement of disputes between an investor and executive authority (local government) are aimed at solving the disputable issues.

The intergovernmental agreements on promotion and mutual protection of investments are signed and ratified by the Verkhovna Rada of Ukraine with more than 70 countries of the world.

For the purpose of proper implementation of national foreign policy and foreign economic priorities, promoting Ukrainian exporters on foreign markets, protection of their economic and trade interests abroad as well as attraction of foreign direct investment in the economy of Ukraine the Council of exporters and investors has been operating at the Ministry for Foreign Affairs of Ukraine since April 2013.

For the aim of activation and realization of the investment potential of Ukraine, increasing foreign investments amounts, priority investment projects support, investment environment improvement, guarantee of the protection of investors’ rights, assessment in effective cooperation of investors with state authorities, in December 2014,by the decree of the president of Ukraine the National Investment Council was formed.

Aiming at the search of viable mechanisms of foreign investments involvement to Ukraine the government regularly holds business forums with foreign investors participation. Indicated measures are to contribute to improve the investment image of Ukraine and to provide growth of foreign investment amounts and capital investments in the economy of the state.