You're reading: Business Update – Feb. 20: Nord Stream delays, food exports up, UN mulls investment

The Nord Stream 2 gas pipeline to Europe through Germany may become only a pipe dream if Russia cannot find a way to complete the last 6% of the project by itself, experts have told the Kyiv Post. The threat of U.S. sanctions in December caused a major European partner of Russia’s state-owned Gazprom to drop out of the $11-billion pipeline project, which could double Germany’s current gas transit capacity to 110 billion cubic meters annually. 

But Ukrainian lawmakers and diplomats are concerned that Russia will eventually complete the pipeline, although experts agree it will be impossible before the end of 2020. Gazprom claims it can complete the final stage by itself and is looking at options, including bringing a vessel into the Baltic Sea all the way from its current location in the South China Sea. On Feb. 18, that pipe-laying vessel was off the coast of Taiwan and headed for Singapore, according to ship-tracking data.

“Not only would the project do immediate damage to the Ukrainian economy… but the pipeline could result in increased aggression in eastern Ukraine,” Dr. Benjamin L. Schmitt, a research fellow at Harvard University and former European Energy Security Advisor at the U.S. Department of State, told the Kyiv Post. Schmitt further warned that Nord Stream 2 is a Kremlin vehicle for spreading “strategic corruption and malign influence.”

Russia would be allowed to radically undermine the energy security of the entire region if the project is completed, according to Svitlana Zalishchuk, a foreign policy adviser to Ukrainian Prime Minister Oleksiy Honcharuk. “Europe would give significant control over its pipe to a country that invests money from energy resources into undermining European elections, attacking strategic infrastructure, and conducting operations against EU citizens,” she said. “It is not difficult to see Nord Stream 2 as a trojan horse.”

Ukraine boosted its agricultural exports by 14% in January, the Economy Ministry reported on Facebook. The country exported $1.98 billion in agricultural goods, 14% more than in January 2019. The top importers of Ukrainian agricultural products in January were China (10.2%), Egypt (10.1%), Spain and the Netherlands (both 8%), and Turkey (6%). With more than a third of the planet’s most fertile black soil, experts say that a properly managed and reformed farming sector in Ukraine could eventually export enough food to feed 900 million people. 

The United Nations is considering more infrastructure investments in Ukraine, the Ministry of Infrastructure of Ukraine stated. The United Nations Office for Project Services (UNOPS) is “considering its participation” in promising infrastructure projects for Ukraine, Interfax-Ukraine also reported. This was discussed at a meeting between Minister of Infrastructure Vladyslav Krykliy and UNOPS representatives in Kyiv. 

Kyiv may buy 273 modern buses this year, the press service of the Kyiv City State Administration has reported, referencing an earlier statement by Mayor Vitali Klitschko. The capital’s transport network is in dire need of a good upgrade, with the overcrowded metro at a breaking point, while roads and even sidewalks are crammed with cars.

“We are constantly updating the capital’s public transport… Over the past few years, we have bought almost 300 units of public transport,” Klitschko said on the Ukraine 24 TV Channel. “These are modern and comfortable buses, trams and trolleybuses,” he said. Critics of the mayor’s statement argue that a reliable bus route serviced by a modern bus is still difficult to find in Kyiv, with such buses scarce and the services running on an erratic and unreliable schedule. Most Kyivans continue to rely on the outdated, overcrowded and unsafe taxi buses, otherwise known as marshrutkas.  

The low-cost Ukrainian carrier Windrose plans to launch a batch of affordable international flights from Kyiv to Slovenia and Croatia, and from Dnipro to Germany and Bulgaria. Citing a company press release, Interfax-Ukraine reported that Windrose would launch the new Kyiv flights during the summer and the schedule will include flights to Ljubljana (Slovenia), Zagreb (Croatia), Berlin (Germany) and Burgas (Bulgaria). They will be operated from Kyiv Boryspil Airport on Thursdays and Sundays, using the Brazillian-made Embraer-145 aircraft. The cost of a one-way tickets with baggage start from about $100.

Windrose also said on Feb. 18 that it would launch daily flights between Kyiv and multiple Ukrainian cities. Passengers can fly from Kyiv to Kharkiv, Dnipro, Lviv, Odesa and Mykolaiv starting in April, the company said. According to the press service of the company, as cited by Interfax-Ukraine and Ukrinform, flights will be operated daily. Starting in November 2020, Windrose also plans to launch flights from Kyiv to Ivano-Frankivsk.