Investment Potential Of Ukraine (Lviv Region Focus) By Business Support Center
Europe’s largest country by area, Ukraine combines the advantages of the longest border with the EU, some of the richest agricultural lands in the world, large and growing domestic market, as well as skilled workforce with labour rates of one tenth of the European average. The location of Lviv oblast on the crossroad of trade routes from Europe to Asia as well as from Scandinavia to South lands provides the access to 100-million consumer markets of Ukraine, Russia and other CIS countries.
Attractiveness of Lviv oblast is ensured by:- dynamically developing market,- highly educated and skilled labour force that easily adapts oneself to market requirements (150 thousand students graduate from 62 higher educational establishments located on the territory of Lviv oblast annually),- significant share of modern industries in the economy of the oblast, increase in the amount of innovation enterprises, wide network of research institutions,- developed telecommunication infrastructure,- modern market of financial services,- low-expense production base and rich recourses,- International airport “Lviv” as well as transport corridors that run through the oblast’s territory,- unique charm of Lviv city, which is included in UNESCO World Heritage List, and lots of recreation opportunities,- ancient traditions of trade with Russia and countries of CIS,- implementation of a number of international development programs in the oblast.
The priority task of the regional state authorities and local self-governments of all levels is to increase investment inflows to Lviv oblast. The Investment Program Welcoming Investors was adopted in the region. The regional Investment Program will provide achievement of the four following goals of the Strategy of Lviv Oblast Development 2015:
1. Lviv oblast is a region of sustainable economic and entrepreneurial development.2. Lviv oblast is a gateway of Ukraine into the EU.3. Lviv oblast is a region of highly qualified people, innovation potential and technologically advanced companies.4. Lviv oblast is a region of clean and attractive natural environment, culture, tourism and recreation.
The investment policy will be based on the well-defined partnership of the state and private sectors and realized taking into account the following principles:- providing investors with the equal rights and terms for investment activity,- providing investors with guarantees against non-commercial risks (deterioration of investment terms, caused by the actions of state officials or local regulatory documents),- matching potential investors’ interests and tasks of strategic economic development of the oblast,- improving investment infrastructure,- promoting Lviv oblast on the investment markets.
Preparation for Euro 2012 Final Tournament and creation of the possibilities for the implementation of wide-scale and small investment projects are the primary tasks of the Investment Program.The information for investors including propositions of land lots, unfinished construction and other investment projects is available at the official Internet Portal of Lviv oblast. www.invest.lviv.ua
Priority Investment Projects1) Reconstruction of International airport “Lviv”International airport “Lviv” is an air junction in Western Ukraine that provides air transportation between the city of Lviv and regions of Ukraine as well as the whole world. 100 thousand passengers and approximately 40 tons of high value cargo run through the airport annually. The airport is included in 2nd geographical zone of the world air space. The Austrian company Airport Consulting Vienna worked out the concept of International airport “Lviv” development. Modernization of Lviv airport was also included in the State Program of Preparation for the Final Tournament of Euro 2012 Football Championship. The project cost USD 166.1 million, including investor’s contribution of USD 97.2 million.
2) Construction of a stadium in LvivA brand new stadium is planned to be constructed in Lviv within the preparations for Euro 2012. The new stadium will be favourably located 12 km from the city centre, near the hugest residential area within the transport corridor # 5. 25 hectare land plot has been opted for the construction of the stadium, its infrastructure together with car parking. According to the project plan, the stadium will be able to host 40 thousand people and that will allow to play quarter-final games. The project of the stadium was developed by the German company HOCHTIEF. The construction of the stadium and its infrastructure requires USD 290 million investments.
3) Construction and maintenance of Lubelska Mine.Lviv oblast is rich in coke. The project foresees extraction of coal with the help of highly effective innovative technologies. The coal from Lubelska Mine is eligible for carbonization and belongs to the most valuable sorts of “K” mark. Its reserves are reported to be estimated at 86 million tonnes. After the completion of mine construction there will be partly national deficiency for cock coal reduced. General need for investment is USD 400 million.
State and Dynamics of Investment Processes
The trend of stable investment inflows to the oblast’s economy is observed: – for the 9 months of 2007 foreign investors invested USD 164.7 million and that is 2.2 times more than for the corresponding period of 2006.- the total investments in Lviv oblast made up USD 653.2 million. By the volume of investment inflows in Ukraine Lviv oblast belongs to the 10 most attractive investment regions holding 8th position, among the western regions it is ranked as the most attractive investment area.Currently 61 countries successfully invest in Lviv oblast. The most significant investments come from Poland, Germany, Denmark and Hungary. Foreign investments were attracted in 1206 companies of Lviv oblast. By the number of the companies that received foreign investments, Lviv oblast holds the 2nd place after the capital of Ukraine Kyiv. The largest investment inflows were directed to the basic branches of the oblast’s economy as well as its banking sector.
The following cities and rayons of the oblast were the most active in attracting investments:- the city of Lviv – USD 425.1 million or 65.2% of the total volume of investments (Laura Ltd. (Italy) – clothing manufacture, Subsidiary Gangso Ukrayina (Denmark) – furniture production, Merkuriy Ukrayina Ltd. (the USA) – transportation services);- Stryy Rayon – USD 52.3 million or 8.0% of the total volume of investments (Leoni Waering Systems UA GmbH (Germany) – automobile wire systems production, Halychyna Zakhid Ltd. (Germany) – pig farming);- Yavoriv Rayon – USD 35.9 million or 5.5% of the total volume of investments (Provimi Ltd. (Poland) – production of fodder, Yevroshpon Ltd. (Spain) – wood processing).
The highest rates of investment resources increase are expected in the following areas: production of details for machine-building industry, production of packaging materials and plastic items, agriculture sector, cargo and passenger transportation industry. Significant investments are expected in the development of the construction sector and production of modern construction materials. In 2008 the financial and banking industries will be developing as well.
April 5th, 2010 No Comments posted in Investment News
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