Ivano-Frankivsk leads the ranking of transparency in investment sector

29.12.2018 Category: 

Recently, an article about the inaccuracies of comparing economic indicators from Ivano-Frankivsk to economic indicators from the city of Vinnytsia was posted on “Firtka”.  Data on the economic growth of these cities are falsely submitted. Deputy Mayor Bohdan Bilyk explained that Ivano-Frankivsk is one of the leaders among Ukrainian cities in attracting direct investments, and that statements made by public activists have no basis in fact. For the sake of accuracy, we have provided a comparison of key economic indicators for the city of Ivano-Frankivsk and Vinnytsia:

Ivano-Frankivsk is one of the leaders in attracting direct investments. The calculated amount of per capita direct investment is 1953.9 USD for Ivano-Frankivsk compared to $365.7 for Vinnytsa. Ivano-Frankivsk had the second highest per capita direct investment (after Kyiv) among the regional centers of Ukraine. The total volume of direct investments in the Ivano-Frankivsk economy as of 10/01/2018 was 494.7 million USD compared to a total volume of 135.5 million USD invested in Vinnytsia. Our city is attractive to potential investors because our years of experience with foreign investments in enterprises such as: “Taico Electronics Ukraine Limited”, SE “Karpaty” and “Electrolux Ukraine” Ltd. Additionally,  Ivano-Frankivsk has a high investment rating for the city and a positive credit history. Ivano-Frankivsk was also rated the most transparent city for business in the transparency rating of the investment sector of the 100 largest cities in Ukraine. This transparency rating is conducted by the Ukrainian offices of international anti-corruption network and Transparency International as part of the project “Transparent cities”.

The National Authorized Credit Rating Agency “Credit-Rating” gave Ivano-Frankivsk the highest level rating when compared to other Ukrainian cities, with a rating of “uaINV5”. For potential investors there is an Investment Portal and an investment passport for the city of Ivano-Frankivsk. These tools were developed in both Ukrainian and English and can be found by following the link: https://www.mvk.if.ua/invclim. In 2018, the city government facilitated talks about attracting investment in the city’s economy with 16 foreign companies. Potential investors were given information about free production areas and land plots. However, one of the largest obstacles to attracting investment in IvanoFrankivsk is that there are not 10 hectare land plots of 10. In order to address this, the city leadership made a decision to form one large investment plot with an area of ​​more than 14 hectares in the Khriplino industrial zone. Additionally, the presence of powerful foreign investors has created competition in the labor market and, as a result, there is a shortage of labor resources, especially labor professionals. It is worth noting that in 2018, and in the next two years, the city plans to expand production capacity, and as a result increase the number of new workplaces at already existing enterprises with the help foreign investments. Two new shops for the Shkoda project have been opened at the KPAT: Taico Electronics Ukraine Limited in 2018 and a new Nissan project line has been purchased and planned for 2019. The design documentation for the construction of a new production module is under development. The local enterprise “Intelcom” Ltd in 2018 began construction of new production lines for their plant. Only approximately 2000 people will be employed at these enterprises. Competition for labor in the labor market has contributed to raising the average monthly wage. The labor prices have grown at a rate of 125% over the past year in Ivano-Frankivsk and at a rate of 124.4% in the city of Vinnitsa. As a result, the share of PIT paid by the processing industry increased to 12% from 8% in 2015. During the 11 months of 2018, the personal income tax revenues contributed to the city budget from the personal income tax increased by 157 million UAH from the total in 2017. The foundation of economic development for Ivano-Frankivsk is the development of small and medium-sized businesses (99.9% of the total number of economically active enterprises are SME enterprises). It is worth noting that in Ivano-Frankivsk, the number of small enterprises, ranks 10th for the current population and 5th among the regional capitals of Ukraine. It ranks 1st in the number of small and medium enterprises per 10 thousand people among regional centers with similar population (in Ivano-Frankivsk there are 138 units and in Vinnitsa there are 101 units.)

Additionally, only 1049 physical persons are entrepreneurs and 117 legal entities have been registered in the city during the last 3 three months of this year. Despite the general situation in the country, which significantly affects the business climate in the city, during the 11 months of 2018, entrepreneurs (individuals and legal entities) paid 201.8 million UAH in taxes. The individual tax increased by 44.8 million hryvnas over the corresponding period of the previous  year. The results of the “Regional Doing Business 2018” rating, developed by the Office of Effective Regulation and the Union of Ukrainian Entrepreneurs for the second time, indicate favorable conditions for business development. Ivano-Frankovsk ranked second in the region for comfort for doing business in Ukraine. The development strategy for the city of Ivano-Frankivsk for 2028 (referred to as – “The Strategy”) was developed collaboratively by the city government, businesses, public non-profit organizations (created by the working group on the development of the Ivano-Frankivsk Development Strategy) and experts of the Ukrainian-Canadian project (“Partnership for Urban Development”). It was approved during a session of the city council on October 27, 2018, (session No. 276). This is the second long-term City Development Strategy developed for 10 years (the first in 1999 was the first in Ukraine) and the fourth for the city. The strategy describes the main goals of development and includes practically all spheres of the economy. It aims to improve the prosperity of all interested parties, chief among them the prosperity of residents of IvanoFrankivsk. The Ivano-Frankivsk city development strategy for 2028 and reports of its progress are published and accessible to the public on the official website of the city of Ivano-Frankivsk at the following links: https://www.mvk.if.ua/sektors/45569 and http: //www.mvk.if. ua / sektors / 48740 respectively.

Within this Strategy, you, Mr. Kozakevych, will find answers to your questions:

– What can Frankivsk offer businesses?

– What is our real economic strategy and policy?

– Why do we have to approach business?

– How and why businesses can grow in our city?

– What can an effective city do to attract and grow business?

– Can businesses pay competitive wages? – How can businesses help fund the city treasury through taxes?