Daily monitor

The Ukrainian Parliament has prolonged the moratorium on the sale of agricultural land until January 1, 2012. 344 deputies voted in favor of the law’s adoption, while the minimum required number to pass the law is 226. Among the reasons for the law’s adoption is the lack of a proper legislative base, which would define land relations. In particular, no law has been adopted on the land market, the land cadastre (registry), and there is no reliable information about the quality of land or monetary valuation of agricultural lands. Parliament believes that the absence of an appropriate legislative framework for the introduction of the land market will lead to market abuse and exacerbate acute social conflict.

DTEK Vostokenergo and Ukrinterenergo have acquired access to 100 MW and 150 MW electricity export capacities, respectively, for January 2010. DTEK paid UAH 3.6 mln for its access, while Ukrinterenergo paid UAH 4.5 mln. Zakhidenergo [ZAEN UZ, HOLD] also participated in the auction but did not purchase anything.

During the inaugural ceremony for the transfer of the An-74T-200A, a middle-weight military transport aircraft, to the Egypt-based client, which was held in that country, the Egyptian party expressed its intention to order approximately 20 of the same aircraft in the near future. Apart from this, no other details of this transaction were disclosed.

On December 18, the Ukrainian Government paid a JPY 563.14 mln coupon on Eurobonds that were issued in December 2006 for a total volume of JPY 35.1 bln. The maturity date of this four-year bond is December 19, 2010.

The International Grain Council (IGC) has warned of an impending reduction, by 1%, of the total area in the world under wheat cultivation in the 2010/2011 season, as opposed to the current marketing year. The planted area will decrease from 223.5 mln ha to 222 mln ha in that period. The United States and Russia, the largest exporters of wheat in the world, will face the problem of declining grain production, the main reason for which should be the low prices for wheat this fall.

The Economic Court of Kyiv has instituted legal proceedings on the bankruptcy of the Ukrainian Food Company (UFC), which was once a major player on the Ukrainian sugar market that united 14 sugar mills and several agro firms. In 2008, UFC faced a shortage in its sugar beet supply and decided to exit the market. The Company managed to sell six mills to the Mriya agro holding and another one to the Ukrros Sugar Union.

The negative balance of export-import operations and continued capital outflows from Ukraine has led to a reduction in foreign reserves by a total of USD 421 mln to USD 27 291.04 mln, a decline of 1.52%.

An extraordinary meeting of shareholders of Bank Forum took place on December 17-18, 2009. The Bank’s majority shareholder is Commerzbank Auslandsbanken Holding AG, which owns a 63.0017% stake. At the meeting, Commerzbank insisted on increasing the authorized capital by UAH 1.1 bln to UAH 3.359 bln, which would virtually allow the majority shareholder to gain full control of Bank Forum. The decision to increase the authorized capital was not accepted by participants in the EGM. This discussion has been postponed to the next shareholders’ meeting, expected to take place in the near future, for further discussion

EU ministers approved Ukraine’s acceptance to the European Energy Community last Friday. According to European Union Energy Commissioner Andris Piebalgs, this move could help Ukraine, as an important transit country, upgrade its infrastructure. The European Energy Community holds the objective of securing energy supplies between its respective member countries.

Alfa Bank (Ukraine) has decided to increase its authorized capital by UAH 739.435 mln to bring the Bank’s total capital to the level of UAH 3 716 mln. This is to be achieved through and additional share issue. In 3Q2009, the Bank ranked seventh among Ukrainian banks in terms of assets, which currently stand at UAH 33 963 mln. It also became known that Alfa Bank (Russia) intends to buy up the additional shares issued.