: Bloomberg: Ukraine to lure shippers from Asia to Baltics improving ports

15:20 Jul. 13, 2016

Bloomberg: Ukraine to lure shippers from Asia to Baltics improving ports

Russian warships stand at the entrance to the main harbour on March 6, 2014 in Sevastopol, Ukraine. (Getty Images)

Government seeks to offer Black Sea ports for concession

Ukraine, whose trade links with Russia have been severed by a two-year insurgency in its eastern regions, will strive to offset that loss by becoming a transit hub for shipments from the Persian Gulf, Asia, China to the Scandinavian countries and the Baltics.

The government wants to create "comfort and confidence" for businesses and is struggling to change a cumbersome customs policy, cut high port fees and improve difficult logistics, Infrastructure Minister Volodymyr Omelyan said in an interview in Kyiv on Tuesday. The cabinet is in talks with several international companies as it seeks investors to modernize Black Sea ports and upgrade Soviet-era railways and river transport.

Read also NATO begins naval exercises in Black Sea

"I'd like to bring talks with China Shipping and Port Dubai to a successful completion," Omelyan said, adding that the Dubai Ports Authority is considering investment in the Odessa port. "We have started discussing preliminary possibilities with Hutchison Port Holdings Ltd. There is a clear understanding that logistics at Ukrainian ports do not meet modern requirements. Many ports have to be rebuilt."

Europe's largest country by area after Russia relies on foreign investment to propel its recovery from an 18-month recession. Besides the war with separatists and mutual trade sanctions with Russia, the cabinet and its western donors are grappling with a legacy of red tape and corruption that has scared off investors. Parliament has yet to approve new laws on privatization, concession, on railway and river transport strategies to boost the country's potential as a global transit country.

"Investors from Asia, Europe and the U.S. are in contact with us," Omelyan said. "They are interested in port infrastructure, stevedore companies, privatization and concession."

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