Long-term contracts for woodworking industry and renovation of border crossings: Yuliia Svyrydenko discusses business issues with Zakarpattia entrepreneurs

The problem of queues at the border, lack of staff, servicing loans from foreign financial institutions and the timeframe for returning foreign currency earnings when exporting goods and importing equipment – these and other issues were discussed during a meeting between President Volodymyr Zelenskyy and First Deputy Prime Minister – Minister of Economy Yuliia Svyrydenko with the business community of Zakarpattia.

The primary issue raised by the region’s entrepreneurs was queues at the border.

“The Government is working on the development of border crossing points, because only an increase in border capacity will reduce queues and thus speed up the delivery of goods. The Ministry for Communities and Territories Development has already developed a draft Strategy for the Development of Border Infrastructure with the EU and Moldova until 2030 and an Operational Plan with specific measures. These include the construction of new border crossing points and the reconstruction of existing ones. In the near future, we expect to launch empty trucks through the Luzhanka checkpoint, and next year we plan to reconstruct it on a large scale,” said Yuliia Svyrydenko.

In parallel, the reconstruction of the terminals at Uzhhorod border crossing point will continue to separate freight and passenger transport. This will increase the capacity for trucks by at least 30%.

Also, according to Oleksii Kuleba, Deputy Prime Minister for Restoration of Ukraine and Minister for Communities and Territories Development, who attended the meeting, the Government plans to build a new Bila Tserkva crossing point for both trucks and passenger transport in the near future. The Romanian side is already completing the construction of a bridge across the Tysa River. The Velyka Palad checkpoint is being prepared for opening on temporary infrastructure.

Oleksii Kuleba added that the Government was working to ensure that all enterprises with the status of a joint transit entity would receive guaranteed simplifications when crossing the border. By the end of November, the State Customs Service is to provide a protocol for the exchange of data on the common transit regime (NCTS). After that, the Ministry for Communities and Territories Development will launch the full-scale common transit regime in the eCherha system on 15 December.

During the meeting, entrepreneurs also raised the issue of international payments.

“The timeframe for returning foreign currency earnings continues to be short for normal business operations. Businesses are also concerned about restrictions on servicing loans from foreign financial institutions. This undermines the ability of Ukrainian companies to attract new financing. All further steps to lift these restrictions require decisions by the NBU and the approval of partners, including the IMF. We are constantly working to explain that the removal of such restrictions is critical for the manufacturing business. The Government has already provided recommendations on the timeframe for extending the period for foreign exchange earnings of exporters of machine-building products to 270 days,” said Yuliia Svyrydenko.

Some of the restrictions have already been lifted. For example, back in May, the restrictions on direct payments for goods and services, including payments for participation in exhibitions, were lifted. Now banks should not refuse to make such payments to companies. Given that businesses still have questions about paying for participation in exhibitions, she promised to remind banks once again about the legal regime for making cross-border payments.

The participants also discussed current issues of the wood market. According to entrepreneurs, the furniture and woodworking industry needs long-term contracts for wood for processing companies.

According to Yuliia Svyrydenko, the State Enterprise “Forests of Ukraine” will hold the first auctions for the sale of wood harvested in 2024 in early November with a delivery period of 6 months and a fixed price for this period. In the future, the Government plans to extend the terms of such contracts by at least a year. Relevant work is currently underway to prepare for the second reading of the draft law “On the timber market”.

Other issues raised during the meeting included the launch of a lending programme for defence industry producers, fixing gas prices for long-term use by domestic generation, and addressing the problem of staff shortages. The parties discussed new incentives for retraining, housing, and changes to the system of state aid payments for IDPs.

In the context of state support for the agricultural sector, the parties discussed the possibility of including the use of own seedlings in the programme of grants for gardening.