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Ministry of Economic Development and Trade offers to direct sum worth UAH 500 million to support enterprises producing road building equipment
08.02.2018 | 15:20
MINISTRY OF ECONOMIC DEVELOPMENT AND TRADE OF UKRAINE

February 7, the Ministry of Economic Development and Trade of Ukraine hosted a meeting on mechanisms to provide support to Ukrainian manufacturers of specialized road machinery with First Vice Prime Minister, Minister of Economic Development and Trade of Ukraine Stepan Kubiv as Chair.

"To ensure large-scale construction of roads in Ukraine we need a range of different road equipment, and Ukraine has production facilities for at least 15 groups of such machinery. Therefore, we propose to direct around UAH 500 million as the state support to provide for Ukrainian enterprises an opportunity to upgrade their facilities and boost production," Stepan Kubiv emphasized.

He added that the developed mechanism will allow to encourage the modernizing of industrial capacities of road building enterprises due to partial compensation of the cost of road construction machinery produced in Ukraine and interests on loans for the purchase of such equipment. The mechanism will be similar to the program of compensation for the cost of agricultural machinery, as it will work on the ‘money follows the client’ principle. Thus, the decision as to what equipment to buy and when will be taken by the buyer, choosing from the list of Ukrainian manufacturers approved by the Cabinet of Ministers of Ukraine.

"It is a fact that enterprises engaged in road construction activities often take loans for the purchase of a large number of road construction machinery. Therefore, support in the form of partial compensation of the cost or interest on loans for domestic production should increase its competitive advantages with respect to imported analogues," Stepan Kubiv emphasized.

Moreover, he emphasized that, on the proposal of the Ministry of Economic Development and Trade, the source for financing of the above-mentioned initiative may be the Road Fund.

"1% of the Road Fund budget makes up almost UAH 500 million, which should be allotted for this state support program. I think this is a logical proposal that will allow not just to build roads, but to promote our industry, to create new jobs," said Stepan Kubiv.

He also added that the implementation of such an initiative would afford us to attract interested investors to create joint ventures in Ukraine for the production of road construction equipment.

"Foreign investors are keen on the possibilities of setting up such enterprises in Ukraine. After all, the demand for Ukrainian road construction machinery is supported by ambitious plans of the Government to construct and overhaul road infrastructure in the country," stressed the First Vice Prime Minister.

On the outcomes of the meeting, the participants agreed upon the principles included in the draft resolutions of the Government on the mechanism to encourage the provision of specialized road equipment for enterprises of the road sector and the municipal economy. After the Ministry of Economic Development together with Ukravtodor, the state banks and businesses finalize the draft resolution, it will be submitted for approval to the Cabinet of Ministers.

 

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