Chronicle of Current Events

Aluminum Alliance: One Against, Rest For

According to UNIAN, reliable sources state that directors of a number of leading Ukrainian industrial enterprises, including Pivdenmash, Motor Sich, and others, sent the Ukrainian Premier a letter in which they express their support for the proposal by Russia's Siberian Aluminum industrial group to create a joint Russo-Ukrainian aluminum corporation.

The Ukrainian directors think that the Mykolayiv Alumina Plant's joining to the corporation will not only make it possible to solve the problem of marketing Ukrainian alumina along with upgrading and expanding production facilities, but also to efficiently incorporate the plant's products into an integrated technical cycle.

At a meeting in the Ministry of Industrial Policy, the idea of integrating Ukrainian and Russian plants producing or processing alumina and primary aluminum, as well as facilities manufacturing aluminum end products, was approved by many of the managers of leading aluminum enterprises and military-industrial establishment, as well as by scientists and experts at major Ukrainian research institutions. Mykola Naboka , the new manager of the Mykolayiv Alumina, categorically opposed the creation of such a corporation.

Chornobyl to Get Nuclear Waste Processing Plant

Signing the contract to build in Ukraine a plant for processing the liquid radioactive waste of the Chornobyl Nuclear Power Plant is “one more step toward decommissioning the Chornobyl Nuclear Power Plant,” said president of the Enerhoatom National Electric Company Mykola Dudchenko in Kyiv after affixing his signature.

The contract was signed between Enerhoatom and the international consortium of Belaton/SGN/Ansaldo (Belgium/France/Italy). The cost of construction is EURO 17.4 million. The project is being financed through the EBRD's nuclear safety fund.

The plant represents an integrated unit that provides for the extraction of waste from containers, waste receipt, preparation, solidification, packing, and temporary storage of conditioned radioactive waste. The designed output is 2,500 cubic meters of waste a year. At present, 13,500 cubic meters of liquid waste have been accumulated at the plant. The completion of the construction project and its transfer to the plant is expected in late 2001, reports Interfax-Ukraine.

Breakthrough Overlooked

In the first eight months of 1999 tax revenues to the state budget came to UAH 7.4 billion, or 92.3% of the target, said Head of the State Tax Administration Mykola Azarov. The consolidated budget index was 100.6%.

At the same time, the total back taxes are still high, totaling UAH 10.8 billion. Almost one thousand enterprises has budget debts exceeding one million hryvnias, with arrears of enterprises under the Ministry of Energy accounting for 13%, and those under the Ministry of Industrial Policy 4% of the total.

Azarov puts down the deficiency of revenues to the treasury by narrowing the tax field and decreased pressure on agricultural producers. On the other hand, this made it possible to point to a supposedly achieved “breakthrough in tax reform.” Why has nobody noticed it? Perhaps because the insignificant tax relief failed to bring about significant changes in the taxation process: half the economy is driven into shadows, while the remaining half is being unrelentingly squeezed for money. Meanwhile, the tax reform never got started, reports Petro IZHYK, The Day

National Bank to Support Government with Additional 348 million

Financing of the government by the National Bank by means of purchasing government bonds will not exceed UAH 2.03 billion. From September through December the financial ceiling is UAH 348 million, reports Interfax-Ukraine. In accordance with a Ukrainian government memorandum issued for the IMF within the framework of the third EFF revision, the net volume of purchase of government bonds from the beginning of this year not to exceed UAH 1,682 million by the end of September, and UAH 1,782 million by the end of November. Under the memorandum, the National Bank shall finance the government exclusively by purchasing government bonds. On the other hand, under the law On the NBU adopted last summer, the National Bank is not empowered to buy government bonds directly.

As of the end of August, the government had garnered UAH 2,899 million on the government bond market for bonds with a nominal face value of UAH 3,553 million. In 1999, the National Bank has been buying practically all long maturity and low yield bonds.

How to Save the Sinking Shipping Company

First Deputy Premier Anatoly Kinakh does not rule out drawing personal cadre “conclusions” [a.k.a. dismissals] if the financial standing of the state-owned Black Sea Shipping Company should worsen, Interfax-Ukraine reports. “Government measures designed to financially rehabilitate the BSSC have been fulfilled unsatisfactorily,” Kinakh said. According to him, “not only the deadlines for a number of serious tasks have been missed, but the positive dynamics of financial and economic results in BSSC activity have also gone unfulfilled.”

In May, the Cabinet adopted measures to bring the BSSC out of crisis, including conducting an audit, bringing under control the BSSC's offshore shipping companies, repaying the company's foreign and domestic external debts, and the transfer of its housing facilities to Odesa authorities. The government granted the BSSC a grace period to pay off its back taxes, allocated targeted funds, and unfroze the enterprise's bank accounts.