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 Government & corporate raidership? ArcelorMittal crying foul; Pension system close to collapse; Horizon Capital & Vitmark; IMF; nterContinental Kyiv; U.S. Amb Tefft statement; EPAM Systems; Salans; Higher Yields, Only Answer
U.S.-Ukraine Business Council (USUBC)
Washington, D.C., Monday, October 4, 2010
INDEX OF ARTICLES ------
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1. ARCELORMITTAL FEARS OVER UKRAINE
World's biggest steelmaker, country's leading steelmaker crying foul
By Neil Buckley in Kiev, Financial Times, London, UK, Sun, Oct 3 2010
2. ARCELORMITTAL KRIVIY RIH RECEIVES VAT TREASURY BONDS
Government of Ukraine owed steel company $400 million in unpaid vat tax refunds
Steel Orbis, Istanbul, Turkey, Friday, 10 September 2010
3. UKRAINE'S GENEROUS PENSION SYSTEM CLOSE TO COLLAPSE
Analysis: by Olzhas Auyezov, Reuters, Kiev, Ukraine, Thu, Sep 30, 2010
4. HORIZON CAPITAL INVESTS INTO VITMARK, LEADING UKRAINIAN NON-ALCOHOLIC BEVERAGES COMPANY
Horizon Capital, Kyiv, Ukraine, Fri, Oct 1, 2010
5. STATEMENT BY IMF MANAGING DIRECTOR DOMINIQUE STRAUSS-KAHN AT THE CONCLUSION OF HIS VISIT TO UKRAINE
IMF, Press Release No. 10/375, Wash, D.C., October 2, 2010
6. INTERCONTINENTAL KYIV CELEBRATES ITS 1 YEAR ANNIVERSARY
InterContinental Kyiv, Kyiv, Ukraine, Fri, Sep 24, 2010
7. CONFERENCE: IMPLEMENTATION OF LEGISLATIVE INITIATIVES ON PREVENTING AND COUNTERING CORRUPTION IN UKRAINE
Talking Points for Opening Remarks by U.S. Ambassador to Ukraine John F. Tefft
Conference: Implementation of Legislative Initiatives On Preventing and Countering Corruption in Ukraine.
Public Affairs Section US Embassy Kyiv, Kyiv, Ukraine, Thursday, September 23, 2010
8. EPAM SYSTEMS ACQUIRES INSTANT INFORMATION, INC.
Leading provider of cloud based information management and discovery services
EPAM Systems, Newtown, PA, Tue, Sep 21, 2010
9. SALANS ADVISES DRAGON CAPITAL ON ESTABLISHMENT OF THE EUROPE VIRGIN FUND
Salans law firm, Kyiv, Ukraine, Wed, Sep 1, 2010
10. HIGHER YIELDS: THE ONLY FARMING ANSWER
Analysis & Commentary: Dennis T. Avery
Director, Hudson Institute's Center for Global Food Issues
Sierra Vista Herald, Sierra Vista, AZ, Mon, Sep 6, 2010
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1. ARCELORMITTAL FEARS OVER UKRAINE
World's biggest steelmaker, country's leading steelmaker, crying foul
By Neil Buckley in Kiev, Financial Times, London, UK, Sun, Oct 3 2010
KIEV - ArcelorMittal, the biggest foreign investor in Ukraine, is crying foul over a legal case brought by prosecutors that it fears could be the first step in an attempt to strip it of its $4.8bn investment in the country's leading steelmaker.
If the case continues, analysts warn it could do serious damage to Ukraine's image, at a time when Viktor Yanukovich, the Russia-leaning president elected in February, has pledged to improve the climate for foreign investors.
The world's biggest steelmaker bought Ukraine's Kryvorizhstal for $4.8bn in 2005 when the government reprivatised the steel mill – previously bought by Ukrainian tycoons for $800m – following the 2004 Orange Revolution.
ArcelorMittal later agreed with Ukraine's State Property Fund, which handles privatisations, to amend its purchase agreement and delay some agreed investments in the plant in 2009 because of "force majeure". Ukraine's steel industry was hit particularly hard by the global recession.
Ukraine's general prosecutor's office in July launched legal action against both ArcelorMittal's Ukrainian unit and the State Property Fund claiming the "force majeure" amendment was improperly reached. ArcelorMittal and the SPF deny this.
ArcelorMittal says breaches of procedure and of national and international legislation have raised doubts that it will get a fair hearing.
"If the judge rules that this amendment was illegal . . . we [become] late in our investment obligations," said Rinat Starkov, chief executive of ArcelorMittal Kryviy Rih, as the unit is now called. "We believe the second step could be to say that we are late in our investment obligations and so the shares have to go back to the state."
ArcelorMittal would receive the proceeds of any future resale. But it might fetch considerably less than the steel group paid.
Christophe Cornier, a member of parent group ArcelorMittal's general management board, told the Financial Times this weekend he was "deeply concerned" about the case.
Mr Starkov said he suspected that though the legal action was brought on behalf of the government, business interests rather than the state itself were ultimately behind it.
A judge on Friday accepted the case be heard in the Kiev City Commercial Court – in spite of a clause in ArcelorMittal's purchase agreement saying that any dispute with the government should be resolved in an international arbitration court. The judge, substituted on to the case at the last moment, scheduled a second hearing for Tuesday. The gap of one working day is far shorter than normal in such cases.
Prosecutors could not be reached for comment this weekend.
Serhiy Lyovochkin, head of Mr Yanukovich's presidential administration, said he was not familiar with the case and could not comment. But he said Mr
Yanukovich's coalition remained committed to improving conditions for investors.
LINK: http://www.ft.com/cms/s/0/dc85d3f0-cf19-11df-9be2-00144feab49a.html
USUBC NOTE: Reports indicate there is considerable corporate raidership going on in Ukraine today with the Ukrainian private sector raiding the private sector with very little support to stop such raidership from the Ukrainian government or the Ukrainian legal system. The private business community in Ukraine certainly hopes the government of Ukraine has not decided to also engage in corporate raidership. The private business community is pleased to hear the government remains committed to improving conditions for investors and hopes some real action to improve the conditions for doing business in Ukraine will finally be undertaken soon.
NOTE: ArcelorMittal is a member of the U.S.-Ukraine Business Council (USUBC), Washington, D.C., www.usubc.org.
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2. ARCELORMITTAL KRIVIY RIH RECEIVES VAT TREASURY BONDS
Government owed steel company $400 million in past due unpaid vat tax refunds
Steel Orbis, Istanbul, Turkey, Friday, 10 September 2010
KYIV - ArcelorMittal Kriviy Rih, Ukraine-based subsidiary of the world's largest integrated metals and mining company ArcelorMittal, has stated that it has received VAT refunds through VAT treasury bonds claimed in the amount of the debt accumulated up to May 1, 2010.
"We acknowledge that we received last Friday the VAT bonds in payment for our accumulated debt until last May 1. Understanding the challenging situation the Ukrainian government is facing with VAT refunds, we have accepted that issuing the VAT treasury bonds was a controversial but necessary compromise decision.
"We have accepted this compromise against the government commitment that VAT refunds from May 1 onwards will be made in cash and on time, and we are now confident that the government will comply with its commitment," ArcelorMittal's executive vice president Arnaud Poupart-Lafarge has stated.
"As an enterprise to which the state owes the biggest VAT refund debt, we perceive the issuing of the VAT treasury bonds as an important milestone in resolving the VAT refund issue. We expect the reestablishment of the automated VAT refund to take place soon," ArcelorMittal Kriviy Rih's CEO Rinat Starkov commented.
As of August 18, 2010, Ukrainian government's VAT refund debt to ArcelorMittal Kriviy Rih was UAH 3.186 billion (about $401.26 million), of which the debt of UAH 1.7 billion (about $214 million) up to May 1, 2010 was claimed via VAT treasury bonds.
LINK: http://www.steelorbis.com/steel-news/latest-news/arcelormittal-kriviy-rih-receives-vat-treasury-bonds-554024.htm
USUBC NOTE: The government of Ukraine did not pay back VAT tax refunds they owed private companies for over two years. By the summer of 2010 the government owed many large private exporters from Ukraine such as ArcelorMittal, grain companies and others exporters hundreds of millions of dollars with the total being almost three billion dollars. When the government finally decided to pay back the VAT tax refunds owed up to May 1, 2010, the government did not do this in cash as is normal in most modern countries, they issued 5 year 5 1/4% bonds which then sell on the market for a huge discount. Instead of cash in and cash out, it was cash in and discounted bonds out. The government has not yet announced a program to pay back the VAT tax refunds built up since May 1, 2010 even though under the terms of the IMF agreement the government is supposed to set up and implement a modern, internationally accepted cash in, cash out VAT refund system.
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3. UKRAINE'S GENEROUS PENSION SYSTEM CLOSE TO COLLAPSE
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ANALYSIS: By Olzhas Auyezov, Reuters, Kiev, Ukraine, Thu, Sep 30, 2010
KIEV - Those who think the French pension system is bloated should take a look at Ukraine, a nation which has not only preserved but enhanced generous Soviet retirement benefits -- which now threaten to bankrupt it.
Street protests might come easier to the French than they do to the Ukrainians. But the government of President Viktor Yanukovich, who is being urged to raise the retirement age to 65years for men and women, is still wary of a possible backlash.
Relatively small on an individual basis -- about $140 a month on average -- total pension expenditure is a big burden on the ex-Soviet republic's budget, making up 18 percent of gross domestic product in 2009, one of the highest rates in Europe.
Ukraine's ageing population means the system's financing needs will only increase unless it is changed. There are already nine pensioners for every 10 working people paying into the pension fund in Ukraine -- and this ratio is set to get worse.
"No system can withstand those demographic trends," said Marcin Swiecicki, director of EU-sponsored think tank Blue Ribbon Analytical and Advisory Centre. "This would be a financial catastrophe."
The World Bank said in a report this month that fiscal reform, which includes an overhaul of the system, was "the most urgent priority" for Ukraine. "The unreformed pension system and Ukraine's ageing population threaten short-term fiscal stability (with growing deficits that are becoming unfinanceable) and long-term sustainability," it said.
Ukraine was taxing payrolls at 35 percent in order to finance pensions -- "one of the highest rates in the world", Swiecicki said.
GROWING BURDEN
But even that is not enough. Without reforms, by 2050, Ukraine will have to reduce its average pension to 28 percent of the average wage from the current 40 percent.
And if it wants to keep pensions at the same level, the nation will have to raise the retirement age to 65 years for both men and women. Under the current rules, Ukrainian men can retire at 60 while women retire at 55.
"Ukrainian women hold the world record in correlation between the length of retirement and the work period needed to obtain a pension: 7.1 years of staying retired for every 10 years of work," Swiecicki said. That compares to 6.2 years in Italy and just 4.6 years in Germany, according to Blue Ribbon data.
Opponents of change say earlier retirement in Ukraine is justified by the fact that life expectancy at birth in Ukraine is 7.8 years shorter than in the EU for women and 13.3 years shorter for men.
Among other worries are the disparity between pensions indifferent sectors -- miners and military officers, for example, enjoy much higher benefits than an average pensioner -- and the fact that only 75 percent of workers pay pension contributions.
"BIG RISK"
In his long-term reform programme announced this year,President Viktor Yanukovich promised to radically change the pension system by switching to an accumulative system used in countries like Chile and ex-Soviet peers Russia and Kazakhstan.
But the government has so far committed only to gradually raising women's retirement age to 60, as spelt out by its $15 billion deal with the International Monetary Fund made in July. It also plans to reduce early retirement benefits and increase the qualification period for full benefits by 10 years.
"This is not a complete solution but it represents a significant step forward," said Blue Ribbon's Swiecicki.
The plans have not been clearly articulated at home. The Yanukovich government has prudently shelved discussion of the issue until after the October 31 regional elections so as not to damage his Regions Party's prospects at the poll.
However, signalling that even modest reform plans could be reviewed, Deputy Prime Minister Sergei Tigipko said this month the government would try to avoid retirement age adjustments --a policy that could displease the IMF. "If we find ways to compensate (growing pension expenditures) without raising the retirement age, we will not raise it," Tigipko told reporters.
"If we don't find ways to compensate we must stimulate people to continue working -- by enabling them to earn more for working every additional year and so on." Carrying out pension reform in a slowly growing economy was"a big risk", he added. NOTE: Writing by Olzhas Auyezov; Editing by Richard Balmforth and Ralph Boulton.
LINK: http://www.foxbusiness.com/markets/2010/09/30/analysis-ukraines-generous-pension-close-collapse/
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4. HORIZON CAPITAL INVESTS INTO VITMARK, LEADING UKRAINIAN NON-ALCOHOLIC BEVERAGES COMPANY
Horizon Capital, Kyiv, Ukraine, Fri, Oct 1, 2010
KYIV - Horizon Capital, a leading regional private equity fund manager, announced today that it has made an investment in Vitmark-Ukraine, one of
Ukraine's leading juice companies whose brands include well-known Jaffa and Nash Sik. The capital comes from its $390 million Emerging Europe Growth Fund II (EEGF II). The terms of the transaction have not been disclosed.
Vitmark - Ukraine is the #2 player on the non-alcoholic beverages market in Ukraine, with market share 27.5%. It currently operates two production sites
in the Odessa region, processing plant in Rakhny and a nation wide distribution network with 12 regional sales offices. Jaffa and Nash Sik brands cover both premium and middle market segments, enabling the Company to reach a broad segment of the population and significantly increase its market share since 2008.
In the recent past, the non-alcoholic beverages market has grown on the back of strong macroeconomic fundamentals. In the short term, the return to GDP
and disposable income growth in the region is expected to trigger a recovery of the market.
While in the longer term, growth in consumption is likely to result from increasing focus and trends toward healthier living, not unlike in more developed markets. With an impressive mix of brands and products in place, Vitmark-Ukraine is favorably positioned to benefit from these market trends.
Natalie Jaresko, Co-Managing Partner of Horizon Capital, commented: "We are pleased to announce the investment into this dynamic company. With its
excellent track record in new product development and nationwide presence, the Company is uniquely positioned to build on its brand strength and capture a significant part of the as-yet underpenetrated market in the region. This marks our fifth acquisition this year, and we continue to believe in strong regional fundamentals."
Vitali Vinitski, Chairman of the Board of Vitmark Ukraine, said: "This transaction provides new possibilities for further and faster development of the company, both in strengthening positions of company's brands in the core market and business expansion to new market segments with increased
investments in innovations."
HORIZON CAPITAL (www.horizoncapital.com.ua) is a private equity fund manager that originates and manages investments in mid-cap companies with
outstanding growth and profit potential in Ukraine, Belarus and the region. Currently, Horizon Capital manages three funds, Emerging Europe Growth Fund
II (EEGF II), Emerging Europe Growth Fund (EEGF) and Western NIS Enterprise Fund (WNISEF), with over $600 million under management.
VITMARK - UKRAINE (www.vitmark.com) is one of the leading Ukrainian producers of juice, nectars, juicy drinks, baby food and concentrates
(brands Jaffa, Our Juice Odessa Baby Food Cannery, Sokovita, Chudo-Chado, Aquarte). Vitmark was founded in 1994, and now owns over 27.5% of Ukrainian JNSD category, also having a leading share of 20% in baby food juices and purees segment. Company's turnover in 2009 was 840 million UAH.
NOTE: Horizon Capital is a member of the U.S.-Ukraine Business Council (USUBC), Wash, D.C., www.usubc.org.
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Promoting U.S.-Ukraine business relations & investment since 1995.
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5. STATEMENT BY IMF MANAGING DIRECTOR DOMINIQUE STRAUSS-KAHN AT THE CONCLUSION OF HIS VISIT TO UKRAINE
IMF, Press Release No. 10/375, Wash, D.C., October 2, 2010
WASHINGTON, D.C. -- Mr. Dominique Strauss-Kahn, Managing Director of the International Monetary Fund (IMF), issued the following statement today in Yalta at the conclusion of his visit to Ukraine:
"I am very grateful for the opportunity to visit the country and thank the people of Ukraine, President Yanukovich, Prime Minister Azarov, Minister Yaroshenko, and Governor Stelmakh and other senior officials for their gracious hospitality and fruitful discussions.
"Our meetings focused on the challenges Ukraine faces in its efforts to ensure sustainable growth and create the conditions to improve the living standards of its citizens. I commend the government on its efforts in implementing its economic program, which is supported by the IMF.
"The comprehensive set of reforms on which the government has embarked include addressing fiscal issues, strengthening the financial sector, modernizing the energy sector and, overall, improving Ukraine's ability to compete in the global economy. Advancing these and other reforms will help to pave the way towards more robust growth, and thus help to increase the investment and employment that Ukraine needs--which is a priority.
"As it undertakes these difficult measures, the government recognizes that the most vulnerable people in society must be protected. The IMF supports these efforts to help the poorest families in Ukraine, and better targeting of social programs can help to reduce costs and improve effectiveness even further.
"We agree that people must be at the center of the reform process.
As well as meeting with the Ukrainian authorities during this visit, I also participated in the Yalta European Strategy conference. This was a very useful opportunity to exchange views with a wide range of representatives from the private and public sectors on the global economy, and on Ukraine's economic ties with the rest of the world.
"I noted at this forum that increased international cooperation is key to recovery from the global economic crisis. That is true for this region as well as for the rest of the world. And working with its neighboring countries and other partners, Ukraine has an important role to play.
"Let me conclude by noting that the IMF looks forward to continuing to work closely with the government and people of Ukraine."
LINK: http://www.imf.org/external/np/sec/pr/2010/pr10375.htm
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6. INTERCONTINENTAL KYIV CELEBRATES ITS 1 YEAR ANNIVERSARY
InterContinental Kyiv, Kyiv, Ukraine, Fri, Sep 24, 2010
KYIV - InterContinental Kyiv, the first premium five-star hotel opened in Ukraine by the world's largest hotel group 'InterContinental Hotels Group' (IHG) celebrated its first anniversary on the 1st September 2010.
Opened in September 2009 as one of the few international standard 5 star hotels in Kyiv, the InterContinental Kyiv has already developed a real reputation for first class service and unparalleled events. A recent guest survey using IHG's independent 'Guest Satisfaction Tracking System' placed the InterContinental Kyiv 6th out of the 31 IHG hotels in the EMEA region.
The hotel also performed with real distinction in delivering the best guest experience 'Great Hotels Guest Love' – 95.5% of guests were more than satisfied with the speed efficiency at guest check-in and cleanliness of guest rooms. In only one year of operation the InterContinental Kyiv has become the preferred hotel for visiting diplomatic missions. The hotel has hosted many high profile events and has been utilized by visiting heads of state as well as the foreign dignitaries.
Located in the very heart of Kyiv the 11-story hotel comprises 273 Deluxe rooms, Senator suite, five Ambassador suites, two Signature suites, a 212 square meter Royal suite and a 314 square meter Presidential suite, both overlooking St Michael's Square. Recreational amenities include a spacious fitness center equipped with advanced technology work-out equipment, an indoor swimming pool and luxurious spa center.
With 2 international fine-cuisine restaurants, a rooftop lounge bar with the best panoramic in Kyiv, 745 square meters of meeting and event space including six meeting rooms and the largest ballroom in the city, the InterContinental Kyiv is a perfect venue that caters for every occasion.
As a birthday gift for its first anniversary InterContinental Kyiv is offering a 25% discount for all guests on almost all services in the hotel.
"In opening the InterContinental Kyiv hotel in August 2009, we sought to raise the bar in standards of comfort, style and elegance for both Ukrainians and international guests. As a part of the world's largest hotel company, we pride ourselves on implementing the best international practices, combining them with local traditions and an impeccable level of service - for us, a standard.
Because of our trademark programme 'In the know', which is uniquely tailored to the Ukrainian market our guests have an unprecedented opportunity to get know the city, and the country beyond - a rare chance to discover the extraordinary marvels of business and leisure that this ancient city has to offer.
We have had an eventful year and are very grateful to the media, local community and to the IHG company for their unrelenting support which has helped us position InterContinental Kyiv among the finest business properties in Kyiv", – commented Anastasiya Zholynska, the General director of the owning company.
"It is with a great sense of fulfillment that we celebrate our first anniversary and move into our second year of operation with successes and anticipation. We are proud of our successes and achievements this year. In such a short timeframe we managed not only to establish a new quality hotel, but also to advance to the position of market leader in hotel services in Ukraine. Currently we are regularly filled to 65% capacity.
According to the independent monitoring report of quality and services in Ukrainian hotels, conducted by company TNS, 92.6% of our guests are satisfied with their stay at InterContinental Kyiv and wished to return to the hotel. These figures speak better than any award. We are grateful for the support of owning company this year and will continue to implement our core mission - to remain one of the "greatest hotels guests' love"– commented Carsten D. Reiher, General Manager of InterContinental Kyiv.
About InterContinental Hotels & Resorts
InterContinental Hotels & Resorts has 160 hotels, located in more than 60 countries with local insight that comes from over 60 years of experience. At InterContinental we believe that superior, understated service and outstanding facilities are important, but what makes us truly different, is the genuine interest we show in our guests. Our desire is to help guests make the most of their time.
We connect our well-travelled guests to what's special about a destination, by sharing our knowledge so they enjoy authentic experiences that will enrich their lives and broaden their outlook. or more information, visit www.intercontinental.com and www.intercontinentalvideo.com.
About IHG
InterContinental Hotels Group (IHG) is the world's largest hotel group by number of rooms. IHG owns, manages, leases or franchises, through various subsidiaries, over 4 300 hotels and more than 630,000 guest rooms in nearly 100 countries and territories around the world. The Group owns a portfolio of well recognized and respected hotel brands including InterContinental® Hotels & Resorts, Hotel Indigo®, Crowne Plaza® Hotels & Resorts, Holiday Inn® Hotels and Resorts, Holiday Inn Express®, Staybridge Suites® and Candlewood Suites®, and also manages the world's largest hotel loyalty program, Priority Club® Rewards with 44 million members worldwide.
IHG has nearly 1,700 hotels in its development pipeline, which will create around 140,000 jobs worldwide over the next few years. InterContinental Hotels Group PLC is the Group's holding company and is incorporated in Great Britain and registered in England and Wales.
IHG offers information and online reservations for all its hotel brands at www.ihg.com and information for the Priority Club Rewards program at www.priorityclub.com. For the latest news from IHG, visit our online Press Office at www.ihg.com/media.
NOTE: InterContinental is a member of the U.S.-Ukraine Business Council (USUBC), Washington, D.C., www.usubc.org.
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7. CONFERENCE: IMPLEMENTATION OF LEGISLATIVE INITIATIVES ON PREVENTING AND COUNTERING CORRUPTION IN UKRAINE
Talking Points for Opening Remarks by U.S. Ambassador to Ukraine John F. Tefft
Conference: Implementation of Legislative Initiatives On Preventing and Countering Corruption in Ukraine.
Public Affairs Section US Embassy Kyiv, Kyiv, Ukraine, Thursday, September 23, 2010
KYIV - Good morning. Distinguished guests, Mr. Rybeka, Mr. Moskal, Mr. Klemencic distinguished deputies of the Verkhovna Rada, officials, scholars, experts, fellow diplomats, and friends,
I am pleased to join you today, to open this important and timely conference on the prospects for anti-corruption legislation in Ukraine. It is particularly good to know that this conference takes place just as Ukraine's leadership is addressing the need for reforming Ukraine's anti-corruption legislation.
The key aspects of this reform include:
(1) ethics and conflicts of interest in public service laws;
(2) financial control through the declaration of assets, expenditures and income;
(3) establishment of a National Bureau of Anti-Corruption Investigations; and
(4) the Anti-Corruption Package of Laws, scheduled to take effect on January 1.
We commend you for these efforts, which will be important steps in Ukraine's continuing progress toward international standards on combating corruption.
A just, transparent, and effective legal system is the very cornerstone of a democratic society. It is the key to protecting human rights, to insuring the rule of law, and to curtailing corruption.
Such a legal system serves not only to protect the people of a nation from crime, but also to ensure that they can resolve business and commercial disputes fairly and openly, that they are protected against excessive governmental power, and that they are assured open and honest treatment by the police, by prosecutors, by the courts, and by all their government institutions.
Rooting out the cancer of corruption is critical to Ukraine's economic future. A fair and transparent legal system is essential to encouraging business investment and promoting economic growth; keys to Ukraine's future prosperity.
I know that the need to reform Ukraine's anti-corruption legislation has been the focus of much debate for many years.
Having ratified several major international anti-corruption treaties, including the United Nations Convention against Corruption (UNCAC) and the Council of Europe's two Anti-Corruption Conventions, Ukraine has binding legal obligations to take concrete measures both to prevent and to prosecute corruption, including enhancing ethics and financial disclosure regimes and increasing enforcement efforts.
I believe that we may finally have arrived at a time when Ukraine will begin to see not just debate about what is to be done, but real progress in combating corruption, through the enactment of genuine reform legislation.
As I noted earlier, the enactment of the anti-corruption package of legislation and the adoption of the laws on the conflict of interests, asset disclosure and establishment of a specialized law enforcement agency are key steps.
It is essential to Ukraine's European future that that this new legislation be consistent with European standards, as set forth in the recently issued expert opinion for the Council of Europe, authored by Council of Europe's Group of States Against Corruption (GRECO) chairman Drago Kos.
Perhaps most important, President Yanukovych has pledged his commitment to meeting international standards in the course of these reforms, and particularly to meeting the standards of the Council of Europe.
This bodes well for the future of the rule of law in Ukraine, and for Ukraine's future prosperity. We applaud and support this commitment. Reform of Ukraine's anti-corruption legislation is an area where the US has long assisted Ukrainian efforts.
When requested by the Ukrainian government, we have helped organize events such as this one, brought international experts from throughout Europe and abroad here to meet with Ukrainian experts, hosted Ukrainian experts abroad, and provided practical support for workshops and publications.
We will continue this support. The United States is deeply committed to Ukraine's democratic and economic development in which strengthening the rule of law is so central.
I wish you a fruitful conference and, more importantly, success in advancing the further development of Ukraine's anti-corruption agenda.
Thank you for your attention and participation.
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8. EPAM SYSTEMS ACQUIRES INSTANT INFORMATION, INC.
Leading provider of cloud based information management and discovery services
EPAM Systems, Newtown, PA, Tue, Sep 21, 2010
NEWTOWN, PA -- Over the last several years EPAM Systems has seen multifold growth in its software engineering services provided to the business information and media industries. To further strengthen their core capabilities in this area, EPAM announces the acquisition of assets of Instant Information, Inc., a leading provider of cloud based information management and discovery services.
Servicing clients in the financial, pharmaceutical, legal, and technology verticals, Instant Information has deep expertise in helping enterprises to manage the exponential growth in the data and content assets they must support, and providing them with the expert level services needed to envision, develop, and operate applications and frameworks that effectively leverage that information.
The company was founded in 2004 and led since by industry veterans Isaak Karaev and John Mahoney. Previously, Mr. Karaev and Mr. Mahoney co-founded Multex, Inc. (NASD: MLTX), which helped to redefine the financial information and research marketplace and was acquired by Reuters in 2003.
"EPAM today serves a number of top global players in the information and media space and also helps to develop cutting edge software technologies and products for leading ISVs serving those industries.
"The management experience and industry expertise of the Instant Information team should add significant value to EPAM's growing business in this field by extending our capabilities into new areas we have not actively pursued in the past, as well as allowing us to offer the right mix of services, domain knowledge, and technology know-how to effectively address the full range of our clients' rising demands in this space," noted Arkadiy Dobkin, CEO and President of EPAM Systems.
"EPAM is an ideal fit for the work we have done in this space," said Isaak Karaev, CEO of Instant Information, Inc. "It gives us the opportunity to combine the deep knowledge and extensive capabilities we have across the entire value chain with one of the fastest growing and technically astute global service providers in the market today. It's a powerful combination that opens up new and exciting opportunities going forward."
ABOUT INSTANT INFORMATION, INC.
New York based Instant Information, Inc. was founded in 2004 to provide knowledge management and collaboration solutions to corporate intelligence and financial professionals. It was launched with start-up capital provided by Standard & Poor's, Reuters and several private equity firms including Union Square Ventures. www.instantinformation.com.
ABOUT EPAM SYSTEMS
Established in 1993, EPAM Systems, Inc. is the leading global software engineering and IT consulting provider with delivery centers throughout Central and Eastern Europe. Headquartered in the United States, EPAM employs over 5,000 professionals and provides services to clients worldwide utilizing a global delivery model through its client facing and delivery operations in North America, UK, Germany, Switzerland, Sweden, Russia, Belarus, Hungary, Ukraine, and Kazakhstan.
EPAM's core competencies include complex software product engineering for leading global software and technology vendors, as well as development, testing, maintenance, and support of mission critical business applications and vertically oriented IT consulting services for global Fortune 2000 corporations.
EPAM is recognized among the top companies in IAOP's "The 2010 Global Outsourcing 100" and in "The 2009 Global Services 100" by Global Services Magazine and neoIT. The company is the only CEE's IT services vendor included in the global "Top 10 Best Performers: IT Services" and also ranked 2nd among the world's "Top 10 Best Performers: Outsourced Product Development" according to the magazine's 2009 rating.
NOTE: EPAM Systems is a member of the U.S.-Ukraine Business Council (USUBC), Wash, D.C., www.usubc.org.
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9. SALANS ADVISES DRAGON CAPITAL ON ESTABLISHMENT OF THE EUROPE VIRGIN FUND
Salans law firm, Kyiv, Ukraine, Wed, Sep 1, 2010
KYIV - Salans has advised Dragon Capital on the establishment of the Europe Virgin Fund. The Fund will invest in fast growing companies in a wide range of private sector mid-sized businesses with primary operations in Ukraine, Belarus and Moldova and will acquire majority or significant minority stakes.
The industry focus will be on FMCG, retail, industrial, telecom, media, technology, pharmaceuticals, construction materials and financial services companies.
Dragon Capital has committed to provide strong strategic support in addition to investing a minimum of $20 million to the Fund as one of the Limited Partners. The Europe Virgin Fund's investors include the European Bank for Reconstruction and Development (EBRD), Swiss Investment Fund for Emerging Markets (SIFEM) and several private investors. The target size of the Fund is $200 million for its final closing expected mid 2011.
Salans' lawyers in Kyiv and London provided full legal support to Dragon Capital on this project. Salans' project team was lead by partners: Oleg Batyuk (Kyiv) and Peter Hughes (London).
Alex Munteanu, Managing Director Private Equity at Dragon Capital, said: "We would like to thank the team of the international law firm Salans for their exceptional professional support on this project. Salans team demonstrated in-depth understanding of business processes in Ukraine, exceptional cross-border expertise and commitment."
Oleg Batyuk, Managing Partner of Salans Kyiv office, said: "We are glad to have helped our client with the successful closing of this transaction. We are proud of the client's confidence in our knowledge and expertise, and we look forward to challenging legal assignments in future."
ABOUT EUROPE VIRGIN FUND
The Europe Virgin Fund is a regional private equity fund sponsored by Dragon Capital with a target size of $200 million. The Fund will provide equity financing to up to a dozen of private sector businesses with primary operations in Ukraine, Belarus and Moldova, in particular, in fast-moving consumer goods, retail, industrial, telecom, media, technology, pharmaceuticals, construction materials and financial services sectors.
Having received commitments from the EBRD, the Swiss Investment Fund for Emerging Markets, Dragon Capital and other limited partners, Europe Virgin Fund expects to start investments in 2010.
ABOUT DRAGON CAPITAL
Dragon Capital (www.dragon-capital.com) is Ukraine's leading investment bank offering a comprehensive range of services in equities and fixed income sales, trading and research, investment banking, private equity and asset management to institutional, corporate and private clients. Established in 2000, the company is an independent partnership controlled by management, with a minority stake held by Goldman Sachs. Dragon Capital accounts for the largest share of turnover on the Ukrainian stock market carrying out approximately a third of reported transactions. The bank has completed more than 50 deals, including IPOs, private placements and M&A transactions, since 2005, raising about $2.0 bn. Dragon's asset management arm has approximately $0.6 bn under management.
ABOUT SALANS KYIV OFFICE
The Kyiv office of the international law firm Salans has 35 lawyers, assisting domestic and cross-border clients with their corporate, M&A, banking, IP, tax and competition needs across a range of sectors including financial services, real estate, energy and natural resources, FMCG, retail and luxury goods, high technology and telecommunications, as well as capital markets. Salans Kyiv office was opened in 1992. Salans Kyiv is highly ranked by the leading international legal directory Chambers Europe 2010 in the following practice areas: Banking and Finance, Corporate/Commercial, Employment, Real Estate, Restructuring/Insolvency.
NOTE: Salans is a member of the U.S.-Ukraine Business Council (USUBC), Wash, D.C., www.usubc.org.
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10. HIGHER YIELDS: THE ONLY FARMING ANSWER
Analysis & Commentary: Dennis T. Avery
Director, Hudson Institute's Center for Global Food Issues
Sierra Vista Herald, Sierra Vista, AZ, Mon, Sep 6, 2010
Is the Green Movement finally ready to face the global need to triple crop yields over the next 40 years—and drop its dedication to land-selfish organic farming? Maybe yes, and none too soon. The planet's wild biodiversity is at stake.
I recently spoke about the benefits of high-yield agriculture to environmental prizewinners at an international DuPont meeting. This isn't news. I've been praising high-yield farming for decades for feeding more people better diets from less land — and thus saving room on the planet for wildlife. I estimate 7 million square miles of wildlife habitat have been spared. This is equal to the land area of South America!
This time, however, I was joined on the program by Dr. Jason Clay of the World Wildlife Fund-US, who echoed most of my praise for high-yield farming. Dr. Clay and I agreed that the world would need more than twice as much food per year by 2050, due partly to the last surge in human population growth, and even more due to the world's rising wealth.
We agreed that with 37 percent of the world's land area already in farming, there was no salvation in doubling the earth's plowed land area. He absolutely agreed with me that the future of world agriculture had to be higher yields, which organic farming has never delivered.
We both noted the latest information on high-yield benefits: a Stanford University study that says the soil carbon that would have been lost if the additional 7 million square miles had been plowed would have equaled one-third of all the world's industrial emissions since 1850!
So whether you're worried about feeding hungry people, saving biodiversity or preventing man-made global warming, the farming answer is always the same — higher yields per acre. And farming is mankind's biggest impact on the natural world, by far.
I suggested to Dr. Clay that this should mean some re-evaluation of the "toxicity" rap that agricultural pesticides have gotten among our urban consumers.
Far more worrisome is the lurking presents of dangerous bacteria in our food. Consumers should demand electronic pasteurization to protect against such threats as salmonella in our eggs, hamburger and fresh produce. The electronic pasteurization kills virtually all bacteria, including the food spoilage bacteria, so fresh foods taste fresher.
The need for tripled world crop yields must be taken into account when federal regulators and judges act to support or block new technology, such as biotechnology. If not overturned, the federal judge who recently ruled against biotech sugar beets is going down a dangerous path with consequences far beyond sugar beets. Without biotech, we may not have the tools to feed the people and save wildlife habitat from the plow.
We should increase our investments in agricultural research, thanking Bill Gates and Warren Buffet along the way for their massive planned investments in research for "a second Green Revolution." The land-grant agricultural colleges and their Council for Agricultural Science and Technology have been swimming upstream on high-yield research in recent decades.
Both the American Farm Bureau Federation and Dr. Clay's World Wildlife Fund/US are partners in a broader alliance (the Keystone Alliance for Sustainable Agriculture) with food manufacturers, such as General Mills and Kellogg's; the Fertilizer Institute; Croplife (pesticides); plus enlightened environmental groups: Conservation International, the National Association of Conservation Districts, NRCS/USDA, The Nature Conservancy and the World Resources Institute.
This is a promising alliance between the idealists and the pragmatists who respond directly to the concerns about food shortage, biodiversity, climate, and ultimate sustainability.
NOTE: Dennis T. Avery is based in Churchville, VA, and is director of the Hudson Institute's Center for Global Food Issues, Wash, D.C.
LINK: http://www.hudson.org:80/index.cfm?fuseaction=publication_details&id=7309&pubType=HI_opeds |
