Ag sector expected to boost FDI
Foreign investors are ready to invest into potentially profitable Ukrainian projects despite the political risks, according to KyivWeekly. “The size of FDI attracted by Ukraine is far below its potential,” Oleksiy Kredysov, a managing partner at Ernst & Young Ukraine told Evolution Media. “A number of sectors of the economy have huge development potential and can be interesting for investors. This allows us to forecast a 40% increase in foreign direct investments this year to US $5.81 bn,” he said.
Ukrainian companies are becoming objects of the close attention of foreign investors as the crediting of companies by banks grew by only 6.9% over January – May. Despite the continuing so-called debt fever in the euro zone, non-residents are showing enviable readiness to enter the shareholder capital of Ukrainian companies and lend money on fairly loyal terms.
Companies in the agricultural sector and food processing industry are expected to traditionally show the highest activity. Ukraine’s reputation as the world’s largest agro-industrial exporter scores additional points for this sector’s companies in the eyes of investors. The threat of a global food crisis and growing prices of food products will guarantee stable profits for such companies, which naturally spurs a growth in the prices of ag corporate stock.
“We expect market players will be positive about agricultural and food processing companies. In addition, the successful public offerings of companies in this sector in 2010 will foster a larger number of placements from Ukraine,” said senior specialist of the Investments and Banking Services Department at Phoenix Capital Vladyslava Hrudova.