Теги: trade
Stepan Kubiv: Ukraine and Canada’s extraordinary business relationship is just getting started

Stepan Kubiv, First Vice Prime Minister and Minister of Economic Development and Trade for Ukraine, special for Financial Post (Canada) 

Ukraine is a trusted friend and partner for Canada. Our relationship spans more than a century of shared family, cultural and political connections. The next step in our ongoing journey together is in expanding our business relationships.

While Ukraine gained its formal independence in 1991, our country is just three years into the rebirth that resulted from the Revolution of Dignity in 2014. Since the Euromaidan, we have set out to build a new European state. We signed a Deep and Comprehensive Free Trade Area agreement with the European Union in 2016, and the Canada-Ukraine Free Trade Agreement (CUFTA) last year — deals that effectively create an uninterrupted duty-free trade zone comprising almost 600 million consumers.

Starting in 2016, our economy has rebounded with 10 consecutive quarters of positive economic growth, including growth of up to 3.8 per cent in the second quarter of 2018.

Even though CUFTA took effect only in August 2017, total Canada-Ukraine goods trade in 2017 grew by 42 per cent to US$349.6 million. A further year-over-year increase of 2.7 per cent was recorded in the first seven months of 2018.

Our trade strategy is combined with an ambitious economic reform program to make Ukraine more attractive to western investment. Since 2014, we have achieved more reforms than at any time since independence. We have deregulated sectors of the economy, streamlined business regulations and undertaken privatization of state-owned enterprises. Reforms are underway to improve creditors’ rights and intellectual property rights. As of July 1, 2018, the total volume of direct foreign investment amounted to US$40.7 billion.

Ukraine is committed to fighting corruption through new legislation, government systems and institutions. The centrepiece of our commitment is the High Anti-Corruption Court, which began in June. International bodies, such as the G7 and the International Monetary Fund, have endorsed the court as a significant step in achieving our anti-corruption objectives.

The next step is expanding our business relationships

These initiatives to improve the investment climate are paying off. Canadian investment in Ukraine increased 20.9 per cent in 2017, and was up 21.6 per cent in the first half of 2018 compared to the same period one year earlier. We are focusing on four sectors: agro-industry, information technology, infrastructure and natural resources. Canadian firms have expertise in each of these sectors and opportunities are opening in Ukraine for potentially lucrative investments. Our trade and investment promotion efforts are therefore concentrated in these business sectors.

Ukraine’s IT industry has transformed rapidly from a fringe economic player to to the country’s third-largest export sector in only five years. In 2017, IT services grew by 20 per cent and exports are estimated to double in the next five years. The IT sector comprised about 61 per cent of Ukraine’s services exports to Canada in 2017.

Our geographic location gives us the potential to be a trade and transportation hub for Europe, the Middle East and Asia. Our road, rail, aviation and marine infrastructure is well developed, but much of it needs renovation, upgrades and modernization, creating opportunities for Canadian investors.

Ukraine is pursuing a goal of energy independence by 2020, opening up opportunities for Canadian companies to help by investing and building infrastructure in both traditional energy segments and for renewables, such as solar, wind and bioenergy. In June, Canada and Ukraine signed a letter of intent on energy co-operation with the International Centre of Regulatory Excellence (ICORE), a not-for-profit organization founded by the Alberta Energy Regulator, to bolster transparency and regulatory excellence.

While it is still early days for new investments, the shovels already in the ground provide an indication that opportunities abound. TIU Canada is constructing a new solar power plant near the village of Kalinovka in the Mykolaiv region. Brookfield Asset Management is a backer of the Innovation District IT Park now under construction in Lviv. Fairfax Financial Holdings Ltd. is a significant investor in Astarta Holding, an agroindustrial holding company. And investment is flowing the other direction as well: Ukrainian investors broke ground in September for the Canada Meat Group Inc. meat-processing plant and cold storage facility in North Bay, Ont.

Ukraine greatly values the support that Canada provides — as a partner for peace, a provider of development assistance through the Canada-Ukraine Trade & Investment Support Project, and shared deep cultural connections. Canada has graciously offered to host the annual Ukraine Reform Conference in June 2019 , and we will welcome the opportunity to describe additional positive momentum.

Ukrainians want a democratic, reliable, and economically strong country. With Canada’s help, we will continue our efforts to deliver it for our mutual benefit.

Source: Financial Post

Export. New Opportunities in Canada

A few months ago, the Canada – Ukraine Free Trade Agreement (CUFTA) entered into force, which effectively opens Canada’s huge market to a great number of Ukrainian companies. Ninety eight percent of customs duties for Ukrainian goods have been eliminated. The region’s needs are significant and diverse. Let’s discuss how to enter the Canadian market and what are the market needs?

Trade volumes with Canada fall far short of their potential capacity: this year, exports of Ukrainian goods to Canada amounted to approximately 0.5% of total Ukrainian exports. Meanwhile, Ukraine imported 7 times as much of Canadian goods, although in actual figures it is just as negligible.

Ukrainian apparel manufacturers (-17.2% of customs duties) and footwear manufacturers (-9.7%), as well as Ukrainian farmers (-4.5% of customs duties for vegetables and fruits) will benefit the most from the customs duties elimination. Moreover, the Agreement opens Canadian public procurement market (its volume is $ 12 billion) on the same terms as for local companies, and specific sections of the Agreement protect e-commerce and intellectual property.

According to the Ministry of Economic Development and Trade of Ukraine, implementation of the Agreement will facilitate a fivefold increase in the turnover of goods between Ukraine and Canada. ‘Each export case is unique. Should you find a partner in Canada, which has allocated quotas, then you will be able to export your goods not having to pay import duties. I would rather not overemphasized priority products, because this may discourage some exporters of so-called ‘non-priority’ products. The Canadian market is very diverse: buyers’ needs in one province may differ significantly from those in other provinces. Therefore, consumers’ needs in each and every province should be studied in detail. It’s quite possible that priority products in different regions may vary.’ – says Oleksandra Brovko, CUTIS Senior Trade and Investment Policy Expert.

However, it should be understood that the Agreement includes certain exceptions for a range of products that can be exported without customs duties only within Canadian quotas (e.g. customs duties for poultry, dairy products, eggs and egg products, cheeses and sugar, when exported in quantities exceeding the quotas, may reach 150-300%). So, as we may see, the list of exceptions largely includes processed agricultural products, which are Ukrainian export priority.

‘Maple’ needs

The structure of Ukrainian exports to Canada is mainly comprised of ferrous metals and their products, fats and oils of vegetable or animal origin, oilseeds and oleaginous fruits, machinery, apparatus and mechanical devices, wood and wooden products, milk and dairy products, eggs and honey. The Canada – Ukraine Trade and Investment Support Project (CUTIS) has identified the following sectors of Ukrainian SMEs as priority ones for further export to Canada.

1. ІТ-services.
2. Apparel.
3. Footwear.
4. Furniture.
5. Chocolate and confectionery.

Moreover, some experts believe that frozen fruits and berries, juices, peppers, cabbage, soybeans, legumes, corn, mineral water, ceramic tiles and sports equipment may also be in a high demand.

However, there are also other assessments of the Canadian demand. According to analysts of the Allbiz International Center of Internet Commerce, requests received from Canadian counterparts had completely changed their focus and structure over the first six months of 2017 compared to the same period of 2016. The Top-3 list included orders submitted to breeding nurseries that breed various types of dogs, orders for tobacco for pipes and hookahs, as well as classic cigarettes.

It is notable that in 2016 orders that prevailed on the Allbiz were those from medium-size businesses for gift and souvenir products, ice hockey equipment for various educational institutions and sports facilities, industrial containers, safe boxes, as well as products made of flexible and tempered steel sheets.

Standards First and Foremost

To be exported to Canada some Ukrainian products should undergo compliance assessment. ‘For instance, some manufactured goods (clothes dryers, washing machines, dishwashers, freezers, electric cookers) are subject to mandatory certification. Meanwhile, apparel and footwear do not require certification (except special workwear, which should comply with established technical regulations). In any case, before entering the Canadian market, one needs to study regulatory requirements for a particular product (quality and safety requirements, standards and technical regulations, etc.)’- says Oleksandra Brovko.

CUFTA regulates certain issues, which ensure the mutual access of goods to the markets of both countries. This had to be done in view of different requirements on product quality and safety, labeling and certification. CUFTA has also addressed the rules for identifying and confirming the country of origin. All products should be fully manufactured or sufficiently processed or recycled in accordance with the prescribed rules of origin. As for sanitary and phytosanitary regulations, the countries shall apply the appropriate WTO regulations. Compliance with countries’ obligations in accordance with provisions of the WTO Agreement on Technical Barriers to Trade has been upheld.

Entering the Market

Entering the Canadian market should follow a number of standard procedures, including studying the level, structure and nature of demand for a particular product, assessment of competition, identifying product distribution channels, etc.  Moreover, one should also understand the Canadian business mindset.

«Canadians take their time to carefully study their future partner. They need time to test their partner by matching words to deeds. That is to reach a certain level of trust. Ukrainian businessmen need to promptly and adequately respond to queries and address all these little issues that may arise before a real business relationship is established. Canadians are cautious when choosing a partner – they are interested in the transparency of business, compliance of manufacturing with the environmental norms, energy saving procedures and corporate social responsibility. Canadians value accuracy, when they negotiate they do so to reach an agreement and make a decision and not simply to ‘discuss an issue’ – says Dmytro Kozonak, entrepreneur, member of the Canadian Ukrainian Chamber of Commerce.

The best way to enter the Canadian market for different products may be different. ‘Some foodstuff manufacturers were able to quickly establish business relations with the Canadian importers having only visited a single trade exhibition, without any preliminary contacts. For apparel and gourmet foods manufacturers, an agency scheme works well, in which it would be good to involve a member of the Ukrainian diaspora. For the В2В segment, an appropriate scheme would be to work through importers, distributors and small retailers. With large retailers it may prove difficult to start the relationship from scratch, if an enterprise has no basic voluntary certification (e.g. ISO). Distributors are open for niche products designed for specific ethnic groups’, – says Oleksandra Brovko.

At the start, it would be better to enter the Canadian market through a local partner company. The fact that the Canadian importer takes responsibility for the compliance with all the requirements to the product will make it considerably easier to enter the market. Canadian distributors who work with the supermarkets and small shops usually have their own warehouses in all provinces. Distributors often work on both the Canadian and US markets, which may be helpful for expanding the geographical scope of sales.

Ukrainian exporters may also use the services of CUTIS project and Export Promotion Office – a consultative body under the Ministry of Economic Development, which may help raise awareness as regards the Canadian market, obtain Canadian market analytics and export consulting services as well as assistance in promoting Ukrainian goods and services in Canada and developing cooperation with the Canadian businesses.

The Ukrainian diaspora in Canada, which numbers about 1.3 million people, is also helpful for doing business there. Overall, Canada is a country of migrants, and consumers’ tastes are quite diverse, which creates good opportunities for selling goods to various ethnic groups of buyers. Everything associated with Ukraine is perceived very well.

Useful links for those who would like to enter the Canadian market

    1. Full text of the Agreement (CUFTA)
    2. Requirements for food products
    3. Automated system on requirements for food product exporters
    4. Dairy products requirements
    5. Product labeling requirements
    6. Export requirements for agricultural products
    7. State agencies, whose permissions may be required for the export of goods 
    8. Export and Import Permits Act (regulates the issuance of export permits, specifies the level of tariff quotas)
    9. State agency controlling compliance with the rules of food import (Canadian Food Inspection Agency)
    10. Canadian customs (Canada Border Services Agency) 
    11. Export requirements
    12. Export quotas

Source: Aval Bank

Paul Darby: Free Trade may cause a rapid investment growth

It is possible that the Parliament of Canada will ratify Canada-Ukraine Free Trade Agreement at its current session. This is the opinion by Paul Darby, the Canadian co-chair of Canada-Ukraine Trade and Investment Support project (CUTIS). He supervises the activities within the international technical assistance project aimed at increasing trade among Ukraine and Canada. The project entered its active phase after the Canada-Ukraine Free Trade Agreement had been signed in July with Prime Minister Justin Trudeau involved.

Paul Darby: Canada-Ukraine Free Trade Agreement was signed in summer 2016, and this is a clear indicator of how Canada treats economic relations with Ukraine.

We hope that the Parliament of Canada will ratify the Agreement in the course of the current parliamentary session, and we expect the same from the Ukrainian side.

Iryna Slavinska: Why has the Agreement been concluded? Is Ukraine such a promising economic partner?

Paul Darby: Yes, Ukraine is a bright example of a good country for Canadian investments. One should also remember about a huge Ukrainian minority in Canada that creates a lot of social and economic links among the countries.

Iryna Slavinska: It is obvious that signing of an agreement between Canada and Ukraine has a political dimension, isn’t it?

Paul Darby: Canada has always supported Ukraine; in particular, it was the first country to recognize independence of Ukraine, therefore, these links were always strong.

Iryna Slavinska: Can we predict any numbers regarding benefits Canada may get as a result of the Agreement signed with Ukraine?

Paul Darby: We have conducted an in-depth analysis survey regarding the impact of the Agreement over the economy of Ukraine. It has showed that the Trade Agreement will affect Ukraine’s GDP, taxes, jobs. There will be increase in jobs for Ukrainians related, in our opinion, to Canada’s investments to Ukraine. When we check similar Canada’s agreements with other countries, we see that it there is always a sharp increase in investments. And when the investments rise that high, they will stay at this level. We hope that it is just this sharp increase in investments that will occur in Ukraine.

The number of jobs for Ukrainians will increase due to Canadas investments to Ukraine

Iryna Slavinska: What are the Canadian goods that may be interesting and competitive in Ukraine and will Ukrainian products be able to win their respectable share so that to be present on Canadian supermarkets’ shelves?

Paul Darby: It is semi-finished goods, clothes, pumping machinery, various hardware, washing machines that may be interesting for Canada. In other words, we try to seek the goods with added value instead of focusing on raw materials.

We are also confident that Ukrainian confectionary goods and footwear will be popular at Canada market; they are highly competitive products.

Recently we also observe the growth in Canada’s demand for Ukraine’s IT services.

Our project funded by the Government of Canada will focus on the commodities and services like these with potential to be popular in Canada. But we shall be open to all companies. That means that, irrespective of your being selected or not for the final short list of the goods in the highest demand in Canada, the CUTIS project will be happy to provide you with assistance in terms of finding partners, buyers, trade fairs, clarifications on Canada’s regulations, etc.

This is a technical assistance project, and we shall be trying to reduce poverty in Ukraine by means of supporting, primarily, small and medium enterprises as they constitute the driver for the economy.

Iryna Slavinska: I have talked with some experts, and they underscore that Ukraine’s IT industry exports mostly raw staff –not the ready products.

Paul Darby: Yes, this is true. However, within the frame of our project we shall be seeking not only the companies that produce just coding for abroad; we shall be looking for those who develop ready products – specific applications and alike.

Iryna Slavinska: You have mentioned that you would provide support for small and medium enterprises, particularly in terms of opening access to the list of promising manufacturers or partners. Is there any procedure how it will work? What should an advice-seeker do?

Paul Darby: Our project has a representative office in Kyiv; you can find us on Facebook – CUTIS account; there is also the web site. Using these channels you may approach us with questions, particularly, Ihor Sanzharovsky, the Project Director in Ukraine.

The short-listed companies will be provided not just with advice. We are going to bring consultants from Canada so that they will hold training sessions with the selected companies to prepare their products for the Canadian market in cooperation with us. That means joint work to develop packaging, elaborate marketing strategies and the steps to meet Canadian standards.

The companies working in the selected areas will be even provided with an opportunity to visit Canada or USA.

Iryna Slavinska: What are the eligibility criteria for the companies to be short-listed?

Paul Darby: First, we are going to conduct a general analysis of the products and services, which may be interesting for Canada. Then we shall pick top-5 of products and services. The next step is that within this range of goods and services we are going to transparently choose the companies that will participate in our project.

The requirements to these companies will include the capacity to supply adequate volumes of goods for the Canada market. We shall also check whether the products of a company meet the environmental protection standards. The companies owned by women will be particularly focused by our project.

Iryna Slavinska: When should we expect that the Agreement will be ratified?

Paul Darby: It is a hard question; however, the Canada-Ukraine Free Trade Agreement’s ratification is in the agenda of the Canada’s Parliament’s current session. The session meetings will be over by April-May 2017. We hope to see the Agreement ratified till Christmas.

Source: Hromadske Radio

Zenon Potoczny: Canada will help Ukrainian business people to enter Canadian market

In the course of the first official visit of Justin Trudeau, the Prime Minister of Canada, to Ukraine the final draft of the Agreement on creating Free Trade Area between Ukraine and Canada was signed at last. Remembering the current modest trade turnover, one should hardly expect any immediate benefits as a result of the Agreement, but in the long-term perspective, 500 billion Canadian market has got a lot of interesting things to offer to Ukrainian manufacturers.

Ukrinform talked about the new trade agreement and the specific aspects of bilateral economic relations with Zenon Potoczny, the President at Canada-Ukraine Chamber of Commerce and one of the most active lobbyists for trade facilitation among the countries

CHOOSING TOP-5 OF THE INDUSTRIES

– First of all, please tell us your evaluation regarding Canada-Ukraine Business Forum held in late June in Toronto?

– Very positive! The Forum was attended by a multitude of participants: more than 150 Ukrainian and 230 Canadian companies. Besides, high profile official delegations from both countries took part. All in all, everything went very well. Bilateral meetings deserve special mentioning. Business people literally were standing in queues to communicate with each other. This is a very good sign, confirming that there may be potential specific business deals.

Businessmen literally were standing in queues to communicate with each other.

– What specific deals are you referring to? What are the achievements of the Forum, in general?

– I can tell about my own organization. We signed the Memorandum on Cooperation with the Ministry of Economic Development of Ukraine, and we are going to work on promoting exports of Ukrainian goods and services to Canada as well as on analyzing the investment projects and engaging investors from Canada.

– As far as I understand, you are referring to CUTIS (Canada-Ukraine Trade and Investment Support project) aimed at promoting Ukrainian exports to Canada, aren’t you?

– Exactly. The Government of Canada allocated 13.6 million dollars to implement this project within 5 years. The project partners include Canada-Ukraine Chamber of Commerce, Conference Board of Canada and the Ministry of Economic Development and Trade of Ukraine. With this latter we are supposed to have consultations, provide recommendations and agree on our activities. In fact, Canada-Ukraine Business Forum was held under the auspices of CUTIS.

– So, do your plans include holding similar events in future to promote bilateral relations, especially Ukrainian exports?

– Yes, they do, we have these ideas. Generally speaking, CUTIS primary objective is to analyze Ukrainian economy in order to identify 4-5 areas that constitute the most interest for Canada from imports’ perspective. After we identify these fields, we shall choose specific Ukrainian companies ready to export. Also, we shall be able to train them, inform them about the local (Canadian) laws and policies, Canadian tax and other regulations, and, more broadly, to assist them in producing marketing strategies. Finally, we are going to bring the companies’ representatives with ready marketing offers to Canada as members of the trade missions. There they will have an opportunity to pitch their projects and services and to tell the potential clients about them.

– When shall we expect the first findings of the CUTIS surveys on perspective areas?

– The work will be started very soon and the first findings will be published in 6 months – 1 year.

HELPING UKRAINIAN EXPORTERS

– What are the prospects the FTA offers for Ukrainian manufacturers? Why does Ukraine need this Agreement?

– At present there are lot of customs duties that constitute the barriers for Ukraine-Canada trade. The FTA will remove 99% of these barriers. This will help both Ukrainian and Canadian companies significantly enhance their volumes of exports. However, the Agreement is not restricted to removing the customs duties; it will withdraw other trade barriers as well.

The Agreement is not restricted to removing the customs duties; it will withdraw other trade barriers as well

– Will the Ukrainian goods be able to compete realistically with Canadian ones, remembering the difference in standards and approaches to production in our countries?

– This is also a constituent part of the CUTIS project: within the frame of it we must help Ukrainian exporters to meet the regulatory requirements of Canada. If they succeed in meeting them, their products will enter the market.

– True, but whereas the FTA comes into force late this year, the change in standards may take years…

– The Agreement comes into force through its ratification by the Parliaments. However, we should start preparatory work right now. We are already in position to clarify the requirements of Canadian private and public sectors for Ukrainian companies. The sooner we start to work with Ukrainian exporters and train them the better. If we want to launch trade immediately after the Agreement’s ratification, one should not lose time now.

– Do you have concerns regarding potential harm to Ukrainian domestic producers as a result of opening the markets?

– Certain problems may occur, but if you check some examples globally, then, irrespectively of the countries having FTAs, in most cases they are mutually beneficial. Otherwise, such practices as free trade areas agreements simply would not exist.

TOUGH CANADIAN TARIFF RATE QUOTAS

– Does the FTA Agreement include provisions on changes in the sphere of investments?

– Yes, it does. In fact, the Agreement is quite comprehensive and does not include only goods, but also workforce exchange as well as other aspects of bilateral trade, such as customs’ documents. There are chapters on intellectual property and environmental issues. Besides, Ukrainian companies are provided with access to Canadian public procurement.

– The Government of Ukraine perceives IT as one of the most promising industries of Ukrainian economy. How do you evaluate the perspectives of Ukrainian IT industry in Canada?

There are a lot of Canadian companies that use the services of Ukrainian IT sector

– It is obvious that IT is a significant and successful sector in Ukraine and it will be very interesting to Canada. In fact, there are already a lot of Canadian companies using the services provided by Ukrainian IT sector; they place orders for Ukrainians to develop software and suggest other types of outsourcing activities. The Agreement also includes all these issues.

– Maybe it is too early to talk about that, but are there any discussions on amending the present Agreement or about signing a new broader one?

– So far everyone focuses on the valid agreement. However, in due course when we start to operate within its framework, there may be a need in some additions.

– Canada was quite skillful in introducing tariff rate quotas for the most successful Ukrainian exports, such as chicken meat or grain. Will this story with EU tariff rate quotas very quickly exhausted by Ukraine repeat in the case with Canada?

– It is true that tariff rate quotas have been set for some Ukrainian goods; but Canada practices this approach with all the countries. There were a lot of talks and discussions on this issue, but no other way out was identified. Hence, there will be tariff rate quotas for some goods and Ukrainian companies will have to fit into them.

THE WINDOW TO USA AND MEXICO

– What are the concerns the Canadian investors have when investing in Ukraine?

– First of all, it is corruption. However, despite the fact that it is not that easy, the situation is improving, especially in view of current Government’s resolute position. The overall situation is much better than it was 20 years ago. One more problem is about judiciary system, but here there are also hopes for positive changes related to the adoption on the new law.

– Are there any Ukrainian investments in Canada?

The sooner the FTA comes into force the earlier a nice window to USA opens

– There are small investments in the construction area, but I have not heard about any large-scale investments. There are also a lot of Ukrainian companies that have some unique inventions, and they try to open an office in Canada to sell these inventions here. Some businessmen even discuss the opportunities to start additional production here to enter the US market. So, the sooner the FTA comes into force the earlier a nice window to USA opens.

– You mean to say that Canada-Ukraine FTA may become a bridge for Ukrainian companies to reach the US and Mexico, don’t you?

– Yes, exactly. In due course the process will reach this stage; however, the US has not launched discussions with Ukraine on free trade yet, therefore, it is the FTA with Canada that opens up this window of opportunities for Ukraine. However, taking into account the rules on the country of origin, you will not be able just to transport goods from Canada to the US. If you want to reach huge NAFTA members’ markets, Ukrainians will have to produce their goods in Canada or assemble them there.

CANADIAN BUSINESS CONSERVATIVE STAND

– In Ukraine’s early years of independence, Canadian investors had some very negative experience in Ukraine. Has the situation changed now?

Ukraine has never been internationally interesting as a country to invest in, so you should inform Canadians about its strengths

– As soon as Ukraine became independent, numerous Canadian companies (most of them owned by the Canadians of Ukrainian descent) attempted to start doing business here. They wanted not only to make some money, but to help the country where their ancestors had been born. Unfortunately, these “pioneers” faced huge disappointment. As a result, the investments from Canada to Ukraine almost ceased to exist. When Kuchma was President, the Canada-Ukraine Chamber of Commerce had to even close down its office, because there was no investment base due to excessive practices of hostile takeovers and fraud. We resumed our work when Yushchenko was elected President. And we felt a new wave of interest within the recent years. The Forums like the one held in Toronto promote this interest, because Ukraine has never been internationally interesting as a country to invest in, so you should inform Canadians about its strengths. Unfortunately, many businessmen think that occupation of Crimea and the war in the East makes it dangerous to stay at the most of Ukraine’s territory.

– What is the image of Ukraine as viewed by Canadian business community currently? Has the country managed to improve it?

– Indeed, the political situation’s change in Ukraine influenced its image beneficially. At present the democracy level is much higher than it was earlier. Every TV channel broadcasts journalist investigations. The schemes are revealed: the country’s transparency is rising. This helps not only average citizens, but businesses as well: they feel that they are able to expose their problems for the public, and they are not afraid of this.

– Why is the Canada-Ukraine trade turnover so low then; 280 million dollars per year for such countries is a very small sum.

– Canadian businessmen are quite conservative. If you want to draw their attention, the investment climate inside the country must be better. However, in due time, after the FTA Agreement is ratified, the mutual trade and investments will grow.

– Has the Canadian investors’ interest in Ukraine grown after FTA Agreement was signed this year?

– Yes, the mutual interest has grown. The number of CUCC members has significantly increased both in Ukraine and Canada.

THE ART “TO SELL”

– What objectives does the CUCC set and how does it reach these objectives?

– Our key role is to promote trade relations among two countries. We provide advice on search of business partners, facilitate dialogue among businessmen, we are looking for interesting Ukrainian projects, which are not currently fit to be presented for an investor. We can help with finishing a presentation, developing a business plan, make calculations and present the project in the best possible way. Our organization also fixes up workshops, business meetings, group visits from Ukraine, etc.

– How often do businessmen approach you to get advice?

Launching FTA is a priority for the Government of Canada. And for the Government of Ukraine as well

– We are receiving a lot of various proposals; most of them are not even ready to be presented, because Ukrainian companies often do not know how to “sell” themselves to an investor. We focus on small and medium sized companies, because it is the sector that is able to improve the well-being of the people. The large rich companies order perfect investment proposals themselves, they have no need in a chamber of commerce.

– Why did the FTA negotiations take such a long time – seven years?

– I assume that taking into account the trade turnover among the countries, FTA was not a priority. On the other side, this Agreement may be viewed as an attempt of Canadian Government to help Ukraine, because within recent two years the negotiations were very intense. In contrast, in Yanukovych times the dialogue was almost stopped. At present, Justin Trudeau said that FTA’s launch will be a priority for the Government. We hear the same comments from the Ukrainian side; thus the process is likely to accelerate.

Source: Ukrinform / Maksym Nalyvayko, Ottawa – Kyiv

Photo: Oleksiy Kovalyov, Yuriy Rylchuk / Ukrinform.

Paul Darby: Canada seeks Ukrainian exporters who will be able to succeed overseas

With the financial support provided by the Government of Canada the Сonference Board of Canada, a research organization, launches a project to identify the Ukrainian companies with potential capacity to export goods to Canada. Paul Darby, CBC, told Delo.UA whom they intend to find and what they are going to do for that.

There are a lot of reasons why we have started this project. There are a lot of Ukrainians in Canada: Ukrainian diaspora is 1.3 million people. Certainly, they are interested in working with Ukraine. Besides, currently Ukraine-Russia relations are tense. Ukraine seeks new markets for its exports, and we are ready to help, because Canada is one of such potential markets. In my view, at present the project is even more timely than if we had launched it 3-4 years ago.

We have signed an agreement with the Ukrainian Chamber of Trade and Commerce and the Government of Canada on the launch of the project aimed at increasing Ukrainian exports to Canada as well as increasing investments from Canada to Ukraine. The project is scheduled for five years. We are at the very initial phase now, and so far we conduct meetings with various organizations and are taking a closer look at local producing companies.

As soon as we finish our survey, we shall be informed which products we are going to focus on; then we shall start choosing specific producing companies. We must understand where exactly the goods are produced. Therefore, we are going to work with the companies based in regions and involve local organizations and chambers of commerce to conduct trainings.

But, I am certain that we are willing to find the companies whose products include specific added value. You see, surely enough, one can sell honey somewhere abroad at a ridiculously low price. Instead, one can sell beauty care products made with honey, and one is supposed to make much more money on selling these products than just honey.

Our key partner is the Ministry of Economic Development and Trade.  But we also work with private sector organizations, e.g. regional chambers of commerce. In future we plan to cooperate in some areas through partnerships with training organizations and universities that would contribute to transferring the knowledge to small and medium businesses’ owners.

Our target audience is the small businesses with prospects for exports to Canada.

Additionally, we are going to provide technical assistance. First, it is about packaging, marketing staff to sell the goods for Canadians, providing advice on Canadians’ quality requirements. Besides, it is about conducting trainings to train the individuals who will be helping local exporters to enter the external markets.

We plan to spend around 1 year to study the Ukrainian market in order to understand which products will sell well in Canada and which companies are fit to do exports. Our mission is just the first step. Then through analysis of the collected data we need to specify how the project shall be developing in future. It will take around two months. After that, by around June, the project will start to work in its entirety: the key activities will commence and financial support will be provided.

It is the Government of Canada that finances the project, but the private sector is supposed to share some expenditures. Within the frame of the project we plan to bring the companies to Canada to attend various events, trade shows, organize b2b events. The companies will have to cover some of the expenses to travel there. We do not know yet which share of the expenses must be covered by the companies: maybe it will be 50/50, or maybe they will cover 1/3 or 2/3 of the costs. It will depend on the sector where the company works, the type of business and products we shall choose as well as their prospective chances for success. However, the companies will have to cover at least 1/3 of the costs, anyway. The project’s total budget is 13 million CAD.

One of the objectives we are addressing within this mission is to meet other donor organizations. We have already had a meeting with the EBRD and we are considering the opportunities to cooperate with them to this or that extent. We already spoke with them about this, but we have not reached any specific decisions yet. However, there are areas where our cooperation with EBRD might appear efficient.

EBRD works on use of EU funding to support private sector, but they do not always focus specifically on exports, they concentrate on support for local producers’ development. We are interested in cooperating with them as partners who are able to help with developing local manufacturers and prepare them for exports activities.

More information on participating in the project is available through sending an e-mail – isanzharovskyi@yahoo.com – to Ihor Sanzharovsky, the project director in Ukraine.

If you want to provide information about you for the project, you should include the following data while sending an e-mail to this address: the name of your company; the name of an owner/chief executive officer; contact info; what your company’s products are, your production volumes; whether you have an experience in exporting your products and why will your product be a success at the market of Canada.