US headquartered agribusiness company Bunge will provide investment over the coming year to improve port facilities in Mykolaiv. Bunge officials concluded a memorandum in late August with representatives from Ukraine’s Infrastructure Ministry and the country’s Seaport Authority, with implementation of the latest port upgrade set to be complete by the end of 2018.
Bunge has been present in Ukraine since 2002 and since then has been one of the largest international investors in the Ukrainian economy. USD 280 million of the company’s Ukraine investments have focused on Mykolaiv Sea Port facilities. Mykolaiv serves as the key gateway to Ukraine’s agricultural heartlands and is the point of departure for much of the agricultural produce Ukraine exports to global markets. It has been the focus for some of the biggest individual international investments in Ukraine over the past two years as agricultural infrastructure has emerged as a strategic priority.
Commenting on the company’s ongoing investment into the Ukrainian agriculture sector, Bunge CEO for Europe, Middle East and Africa Tommy Jensen commented, “Bunge has succeeded to become not only one of the major foreign investors in Ukraine, but also a leading exporter of grain and sunflower oil. We strongly believe in Ukraine and its agricultural potential. By signing this memorandum, we give our commitment to create additional export capacities of agricultural commodities annually. For this expansion, Bunge will provide additional investment till the end of 2018.”
The planned port facility upgrade is expected to boost capacity and improve Mykolaiv’s production potential. Ukrainian Seaport Authority Head Raivis Veckagans stressed that the partnership between the Seaport Authority and Bunge will help to increase Ukrainian agricultural export volumes and consolidate the leading position enjoyed by Ukrainian agricultural products on global markets, while also opening up new opportunities for more complex production lines. “With the framework of the memorandum, the Ukrainian Seaport Authority plans to create additional anchorage for the rapid processing of ships,” commented Mr. Veckagans. “Bunge will increase transshipment volumes and create new jobs. This will help us to increase Mykolaiv port capacity for freight turnover and support the production of value added products, which a particularly promising direction.”
This investment commitment is the latest stage in the agribusiness company’s Ukraine operations. Bunge attracted headlines in summer 2016 with the unveiling of a state-of-art Multi-Seed Crushing Plant and the expansion of its grain transshipment complex in Mykolaiv Sea Port. Ukrainian President Petro Poroshenko attended the June 2016 official opening ceremony and called the USD 180 million investment ‘a vote for Ukraine’. “This investment acts as the best advertisement for the investment opportunities and attractiveness of the country,” commented the Ukrainian President.
The August 2017 signing of a memorandum for the further development of Mykolaiv port facilities drew an equally enthusiastic response from representatives of the business and diplomatic communities as the latest indication of Ukraine’s improving investment climate. US Ambassador to Ukraine Marie Yovanovitch emphasized that Ukraine is becoming a more competitive destination for international investment. “I congratulate the Ministry of Infrastructure for the support it has provided to Bunge in Mykolaiv,” commented Ambassador Yovanovitch. “This support is very important. It testifies to the desire to improve the business climate in Ukraine and build the kind of country that, in my opinion, every Ukrainian wants to live in. With your continued support, Ukraine can become an attractive and dynamic country for international investors and local entrepreneurs alike.”
Meanwhile, American Chamber of Commerce in Ukraine President Andy Hunder admitted that “Foreign Direct Investment (FDI) is crucial for Ukraine on its path of economic recovery. It is always a pleasure to support FDI,” commented Mr. Hunder. “Bunge’s new investment will create new jobs in Mykolaiv and serve as a vivid example for potential investors who are looking at Ukraine as a potential investment destination. I am convinced there will be more success stories to follow.”
Bunge will celebrate its two hundredth anniversary in 2018 and company officials have repeatedly stressed their readiness to share their considerable international experience with Ukrainian officials in order to help improve the country’s FDI attractiveness. “Today we start writing a new chapter in the success story of cooperation between Bunge and the Ukrainian state,” said Mr. Jenson during the memorandum signing in Kyiv. “By signing this Memorandum, we give our commitment to create 400 000 tons of additional export capacities of agricultural commodities annually. We have established a good dialogue with the Ukrainian government. As a global company, we are ready to advise and assist in the development of better regulation, increase the protection of investors, and establish public-private partnership mechanisms, bringing international best practices to the table.”