Ambassador of Great Britain to Ukraine Lee Turner informed that on March 17-19, 2011, the British Business Days will be held in Kyiv; leading businessmen from both countries will get acquainted and discuss prospects of further cooperation. President Viktor Yanukovych also expressed his interest and readiness to deepen bilateral trade relations with Great Britain during the Davos Forum. In particular, according to him, Ukraine is interested in the participation of the British company Shell [as the company’s full name suggests, Royal Dutch Shell PLC is headquartered in the Netherlands, albeit currently registered in London – Ed.] in the development of shale gas deposits. The Duke of York, Prince Andrew, who is Great Britain’s Special Representative for International Trade and Investments, informed about Britain’s interest in Ukrainian agriculture.
Today Great Britain is the sixth largest investor in Ukraine by the amount of investments. In 2010 turnover between the two countries for the first time exceeded one billion dollars. Shell, BP (through a joint-stock enterprise with the Russian company TNK), JKX (development and production of oil and gas), CBM Oil, etc. are among the biggest investors.
The ambassador pointed to the non-transparency of the quota distribution system for grain crops export from Ukraine as a major factor restraining the improvement of the Ukrainian business climate. “In 2010 quotas for grain crops were introduced rather unexpectedly. This means that people dealing with grain crops lost a possibility to freely buy or sell grain. Thus, Ukraine, in fact, worsened the business climate — it became a step which prevents people from doing business in Ukraine,” Turner explained. He expressed his understanding that by introducing quotas for the export of grain crops Ukraine tried to protect its internal market. “However, the situation when some companies get a possibility to earn money due to quotas for grain crops and others don’t, stimulates corruption,” the ambassador summarized.
Turner believes that improving the investment climate in Ukraine will help stimulate trade and the economic dynamics of both countries. According to him, at present in Ukraine a number of positive tendencies are observed which will improve the investment environment: the adoption of the Tax Code and the law “On State Purchases,” the introduction of amendments to the rules for setting up and shutting down enterprises, and also legislative innovations in the sphere of the struggle against corruption. “But none of these measures will make sense without their practical implementation,” the ambassador stressed.
Opening the land market to foreign investors and introducing a system of automatic value added tax (VAT) refunds will add to Ukraine’s attractiveness as well. “I think the automatic VAT refund system will begin to work on March 1; it will become a huge advantage for business and will create favorable conditions for all subjects of entrepreneurship. A situation when there are no unified rules for all subjects feeds corruption,” he said.
In the opinion of the British ambassador, signing the agreement on the free trade area between Ukraine and the EU will considerably improve the Ukrainian investment climate. “Over the last six months we have seen that the negotiations can be successfully concluded this year,” Turner predicted.
