FDI inflow to Ukraine slows to USD 0.7 bln in 1H17
30 August 2017
Inflow of foreign direct investment (FDI) to Ukraine
amounted to USD 711 mln in 1H17, which is four times lower than a year ago (USD
2.9 bln in 1H16), the State Statistics Service reported on Aug 29. In 2Q17,
capital inflow declined to USD 318 mln vs. USD 393 mln in 1Q17.
The Netherlands (USD 482 mln in 1H17) and Cyprus (USD
356 mln) remained the main investors to Ukraine. Investment flowed into
the financial sector (USD 397 mln in 1H17), mining (USD 297 mln), food
processing (USD 220 mln) and metallurgy (USD 169 mln).
Capital outflow from Ukraine was reported at USD 207
mln for 1H17.
Alexander Paraschiy: The plunge
in capital inflow is the consequence of a waning recapitalization process in
the banking sector. The decline in this kind of investment was predictable but
we anticipated a stabilized economy would draw more capital inflow to the real
sector. So far those expectations have not come to reality and current numbers
are far below our initial estimates. Net capital inflow was only USD 504 mln
for 1H17 and so far we do not observe any signs for improvement.
banks (namely, Russian-owned Prominvestbank for UAH 10.5 bln) accounted for
more than half of FDI in 1H17. This tendency still promises nearly USD 1.0 bln
net FDI (excluding bank recapitalization) in 2017.
