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Odesa port discussed an anti-epidemic measures plan in the event of the coronavirus spread

On January 30, a meeting was held at the main office of the Odesa branch of the State Enterprise ‘Ukrainian Sea Ports Authority’ (the OB SE ‘USPA’) on issues related to the spread of the new coronavirus in Wuhan, a Chinese province. The event was attended by specialists from the State Supervision of Sanitary Law Compliance Department of the Main Directorate of State Food and Beverage Service in the Odesa region, led by Lidia Stepanova, head of the department, Zhanna Putienko, chief physician of the medical department of Odesa Sea Port Authority, and heads of departments of the SE ‘USPA’.


At the meeting, Odesa port and other domestic sea ports and airports were noted to belong to the category of objects of possible contact with carriers of hazardous viruses that arrive in Ukraine. In this regard, the heads of the port Authority`s departments and services were provided with recommendations on the rules of conduct and a set of special measures to prevent the coronavirus spread.


Due to the possible spread of coronavirus, issues of coordinating the actions of port Authority with the bodies of the State Food and Beverage Service, and other sanitary and medical institutions of the city in the event of the aggravation of the sanitary and epidemiological situation in Ukraine were also discussed. In particular, it concerned the need for joint exercises with modeling the work of the state border checkpoint for vessels arriving at the port from countries of potential risk.


Odesa Sea Port Authority





Azerbaijan delegation led by Perviz Shahbazov, the Minister of Energy visited Odesa port

ODESA, January 29, 2020, 17:00, the OB (Odesa branch) of SE ‘USPA’

The Law ‘On Concessions’ adopted by the Parliament and the Ministry of Infrastructure of Ukraine perspective vision of the prospects for the domestic sea ports development with an emphasis on the concession mechanism open up new opportunities for foreign investors who cooperates with Odesa port. This was discussed at the inception visit of the Azerbaijan delegation led by Mr. Perviz Shahbazov, the Minister of Energy of the Republic of Azerbaijan, to the port.


The delegation included representatives of a number of state companies and business structures of the Republic of Azerbaijan. The Ukrainian side was represented by Dmytro Abramovych, First Deputy Minister of Infrastructure, top officials and heads of departments of the State Enterprise ‘Ukrainian Sea Ports Authority’ (the SE ‘USPA’). The delegation of Azerbaijan Republic visited the port of Odesa as part of the program of the Twelfth Meeting of the Azerbaijan-Ukrainian Intergovernmental Commission on Economic Cooperation, which will be held the day after tomorrow, January 31, in Kyiv.


At the meeting, Ruslan Sakhautdinov, General Manager of Odesa port Authority introduced honored guests the production infrastructure of Odesa port and the possibilities for handling of additional dry and bulk cargo volumes. A separate section in his presentation was dedicated to the passenger terminal of the port, which the Ministry of Infrastructure and the main office of the SE ‘USPA’ currently consider as one of the potential objects for transfer to the investors` management on the concession basis.


‘The passenger terminal of the port is capable of accepting and servicing the largest cruise ships that call to the Black Sea and is designed to serve 4 million tourists a year’, said R. Sakhautdinov. - Recently, we have noted the real interest of the state in modernizing the main cruise terminal of the Black Sea region, bringing it to the same level with the most modern European passenger ports. Therein, the relevant indicator for all of us is the implementation of the project for the Istanbul passenger terminal reconstruction...


According to General Manager of the port Authority, Odesa port workers got real support for their initiatives on the tourist cruise infrastructure development both at the level of the regional and city authorities and at the level of the relevant ministry. And this makes it possible to substantively negotiate with potential investors.


During the visit to Odesa port, Mr. Perviz Shahbazov and other members of the Azerbaijan delegation visited a number of facilities at the port’s passenger terminal, in particular the Hotel «Odesa». The story of the origin of a five-star hotel at the New mole of Odesa Sea Commercial Port in 2001 and the circumstances of its closure in 2011 was introduced by Olexiy Miaskovskiy, Head of the state-owned enterprise Odesa Port, who has the facility on balance. A. Miaskovskiy also informed about the legal status of the hotel, cited data on the current technical condition of the building and announced the approximate amount of investment needed to restore the hotel.


Dmytro Romenskiy and Sergiy Gronskiy, Deputy Chairmen of the SE ‘USPA’ on the port infrastructure development and maritime and internal security, as well as Dmitro Podorian - Director of the main office of the SE ‘USPA’ also took part in the discussion of the prospects for investment development of the Odesa port passenger terminal.


As reported previously, January 22, at the World Economic Forum in Davos, Volodymyr Zelensky, President of Ukraine proposed attractive initiatives for investors who would invest in Ukraine. Among other issues, he announced the possibility of providing tax holidays and a personal “guardian” from the government of Ukraine under certain conditions.


We should also recall that in December, last year, after announcing winners in concession tenders at the ports of Olbia and the Kherson Sea Port, the Ministry of Infrastructure of Ukraine announced its plans to attract a concession tool for the modernization of other enterprises in the maritime industry. According to Minister Vladyslav Krykliy, in order to prepare for the concession in 2020, the sea ports of Mariupol, Berdyansk, Chernomorsk, as well as certain facilities in Odesa port were preliminarily selected.






MILLION TONS LAST YEAR - CONTI-HORIZON LINE increases metal cargo flow through Odesa port in the direction of the countries of the African continent

According to the main dispatching office of the Odesa branch of the State Enterprise ‘Ukrainian Sea Ports Authority’ (the OB SE ‘USPA’), 4.6 million tons of metal products were transshipped through the port berths last year. Every fifth ton of this volume was shipped to the countries of the west and south-west coast of Africa by the vessels of the overseas line, CONTI-HORIZON LINE.


The Ukrainian company UNITED MARIN GROUP LLC coordinates the schedule for servicing the fleet of the specified line at Odesa port and ensures the readiness of consignments of various customers. According to Ekaterina Kokhanova, deputy head of the company, due to the rapid population growth and also high rates of urbanization, sub-Saharan Africa continues to be one of the most promising market outlets for Ukrainian rolled metal products.


‘Compared with 2018, our partners increased the volume of metal products transported from Odesa port to the African countries over the past year by 15 percent: from 840 thousand tons to 1.010 million tons’, says E. Kokhanova. ‘Of course, this success is largely due to the speed and quality of ship handling at the port terminals.That is why Odesa has been the base port on the Black Sea for the CONTI-HORIZON LINE for more than 10 years. It is here that the formation of metal products consignments of Ukrainian production, as well as transit from Belarus and Moldova for shipment to the ports of Senegal, Cote d'Ivoire, Nigeria, Cameroon, Benin, Ghana, and other countries ...’


As the head of UNITED MARIN GROUP LLC further noted, as for now, metal products of domestic producers ArcelorMittal Kryvyi Rih PJSC, Azovstal smelter, Ilyich Mariupol smelter, Zaporizhstal PJSC, and DMK PJSC Belarusian Metallurgical Plant JSC are shipped through Odesa port to the African direction. Products of these plants are shipped through berths operated by the stevedoring companies Novoteh Terminal LLC, Novolog LLC, Metalsukrain Corp. Ltd. LLC and UNSC LLC. Last year, vessels of the CONTI-HORIZON LINE moored in Odesa port 34 times (in 2018, 31). Two calls were conducted in January, this year.


Reference. Founded in 1923, Conti-Lines (headquartered in Antwerp, Belgium) has become a cornerstone of a powerful group that occupies one of the leading positions in the structure of global shipping. Currently, Conti-Lines offers its customers and partners 9 regular lines and a dense network of routes covering all parts of the world except Australia. This allows us to rightfully call it a global line operator.



FOR WORK IN COMBAT ASSAULT, STORM AND EMERGENCY CONDITIONS: US representatives handed over a batch of special equipment to the personnel of the Maritime Border Guard of the SBGSU in the port of Odesa

On January 24, the official ceremony of handing over specialized equipment to the Sea Guard of the State Border Guard Service of Ukraine took place at the berth #16 of Odesa port (passenger terminal). The property was received from the United States as part of an international project entitled ‘Providing technical assistance to strengthen the export control system of Ukraine and counteract the proliferation of spread of mass destruction weapon’


The event was held with the participation of Colonel Sergey Deyneko, Chairman of the State Border Guard Service of Ukraine, Mrs. Christina Quinn, US Chargé d'Affaires a.i. in Ukraine, and Matthew Goldin, Manager of EXBS Program of the US State Department. Among the participants in the official ceremony, there were Dmitry Podorian, Director of the Main Representative Office of the State Enterprise ‘Ukrainian Sea Ports Authority’ and Ruslan Sakhautdinov, General Manager of Odesa Sea Port Authority.


Opening the ceremony, the chairman of the State Border Service expressed sincere gratitude to the United States for their assistance and praised the effectiveness of cooperation between the border guards of Ukraine and the US Coast Guard.


‘Strengthening the Maritime Border Guard of Ukraine is an urgent condition for ensuring the safety of navigation in the region. The United States will continue to make efforts to develop the infrastructure of Ukrainian border guards’ said Ms. Christina Quinn.


The US Chargé d'Affaires a.i. in Ukraine personally handed over the certificates for the transferred property to the commanders of the Odesa, Izmail, Mariupol Maritime Border Guard units and the head of the Maritime Border Guard Training Center.


The ceremony ended with a presentation of samples of the property received for guests and journalists.


The total cost of equipment received as part of international technical assistance is about 29 million UAH. This is more than 3 thousand units of rescue and inspection equipment for crews of patrol ships and boat fleet and fighters of special actions departments. The equipment will enhance the capabilities of the three units mentioned, and will also be used in the training process at the training center.


The equipment, which has more than two dozen names, includes wrist GPS-navigators, portable gas analyzers of the air condition, inspection mirrors, means of providing communication between members of the inspection group and various lighting devices for rooms and places of possible hiding places from personal tactical lights to searchlight-type flashlights, which are capable to illuminate large rooms, such as holds and containers, fire lamps, and among other enhanced characteristics, have backlighting, which allows the inspection or rescue team to better navigate in difficult conditions. A unique device is the self-rescuer of the insulating type OCENCO M-20.2, designed to protect the respiratory organs (up to 15 minutes) of crews of ships (boats) during evacuation from a smoke-filled room.


Now, all combat posts on ships and boats of the Maritime Border Guard will be equipped with the listed instruments. Similar devices are in service of the US Coast Guard units.


Another urgent thing for the special units and inspection groups of the patrol ship and boat fleet is a lightweight body armor with a buoyancy compensator and with an integrated inflatable system. Such body armor provides against firearms and a fighter’s positive buoyancy in the water.


Besides, the entire crew and special forces soldiers will receive two types of special protective suits: equipment for protection during disembarkation and work in stormy weather and thermal suits designed to protect from hypothermia in the event of an emergency. Such a suit complies with the SOLAS Convention and allows staying in the water at sub-zero air temperatures up to 15 minutes (respectively, at a higher temperature the period increases to 12 hours).


The list of property for delivery was compiled based on a study of the real needs and tasks faced by the Maritime Border Guard personnel in daily inspection work, and in assault, storm, and emergency conditions. The expediency and experience of using equipment by foreign colleagues are taken into account.








DIGITALIZATION: Odesa port provides the opportunity to issue and forward car passes in electronic format

To the attention of carriers and forwarders!


Odesa Sea Port Authority informs you that from 24, 2020, in order to reduce the time required to complete the paperwork for freight vehicles to enter the port territory, freight forwarding companies are given the opportunity to not only issue but also transfer car passes in online mode.


The procedure for issuing passes is carried out through the port community information system. Now you can draw up a pass in the form of a bar code and send it via the Telegram application or by e-mail directly to a mobile device to a car driver without leaving your office. Thus, the driver, while still on the road, receives a pass to his mobile device and then presents it to the port checkpoint for scanning. This is enough for the port staff to get access to the necessary information and let the car enter the port.


Phone for information on the procedure for issuing passes - 729-41-89. The contact person is Denis Gapeev.


Ukrainian Sea Port Authority




Dmitro Razumkov, the Chairman of the Parliament of Ukraine visited Odesa port

The meeting of the Speaker of the Parliament with the port workers took place yesterday, January 23, at the new 2-k berth of the container terminal on the Quarantine mole, operated by the SE ‘CTO’, a company with German investments. The talks were attended by Ruslan Sakhautdinov, General Manager of the Odesa Branch of the State Enterprise ‘Ukrainian Sea Ports Authority’ (OB SE ‘USPA’), Philipp Svens, President of the SE ‘CTO’, Anastas Kokkin, Chief Executive Officer of the SE ‘CTO’.


R. Sakhautdinov, in particular, acquainted the Chairman of the Parliament with the current state of the stage construction of the new container terminal ‘Quarantine mole’. The project is being implemented on the principles of public-private partnership by Ukrainian Sea Ports Authority together and the investor company SE ‘CTO’.


Among other points, General Manager of the port Authority focused the attention of the Chairman of the Parliament in his report on the problematic issues of the project. In particular, it concerned financing the completion of the hydraulic structures construction. According to R. Sakhautdinov, the possibility of concluding a concession agreement with SE ‘CTO’ under the current legislation at the level of the Ministry of Infrastructure of Ukraine is being considered at the moment. In the near future, the investor company will inform the ministry about the result of the consideration of the proposed form of cooperation.


At the meeting with D. Razumkov, port workers also addressed the question of the SE ‘CTO’ dividend rate allocation to the state budget.


Reference. The German logistics concern HHLA (headquarters - Hamburg) has been represented in Odesa port since 2001. Being a 100% subsidiary company of the HHLA group, the subsidiary CTO (Container Terminal Odessa) is the most modern and largest container terminal in Ukraine. In 2019, 391 438 TEU were handled at the terminal. The SE ‘CTO’ is also the only state terminal in Ukraine. It serves all sea lines and freight forwarders without any discrimination. The company provides jobs for more than 460 highly-qualified specialists.


The current throughput capacity of the terminal operated by the CTO subsidiary is 850 000 TEU per year. The implementation of the ‘Quarantine mole’ project supposes the expansion of throughput capacity up to 1.2 million TEU. The CTO subsidiary has a long-term investment agreement with Ukrainian Sea Ports Authority for the management and development of the container terminal until 2044, approved by the Government of Ukraine.


Today, the HHLA group has invested more than 150 million euros in the development of production facilities of the SE ‘CTO’ in Odesa port. In 2020, it is planned to invest another 20 million euros.


Odesa Sea Port Authority







RESULTS 2019: Odesa port stevedores overloaded the largest grain volume in the port history

According to the Economy Service of the SE ‘USPA’, last year, the cargo handling volume of Odesa port reached 25343.6 thousand tons, which is 3645.2 thousand tons or 16.8% higher than the results in 2018. Growth was achieved in all the main positions of the cargo range: grain, ferrous metals, containers, bulk.



In particular, 9 989.5 thousand tons of grain cargo were handled last year. This is the highest result in two and a quarter centuries of the port history.


Previous records in the Soviet era were 7.5 million tons, and in the era of Ukrainian independence made 9 792.2 thousand tons (in 2015). Moreover, last year, grain cargo also showed the best growth dynamics compared with the year before last, the transshipment of this type of cargo increased immediately by 1.9 million tons.


We recall that at the Fifth international conference ‘Grain Terminals: New Projects, Equipment and Technologies’, Ruslan Sakhautdinov, current general manager of the SE ‘USPA’ presented the achievements of eight stevedore companies of Odesa port who were engaged in grain transshipment. His speech was particularly intended for the need to establish systematic industry monitoring of the environmental sound of port elevators. According to the speaker, the laboratory-confirmed low levels of pollutant emissions confirmed in the air on the Odesa port territory are the result of long-standing work of the port Authority and private stevedoring companies, including ‘grain’ ones who invest quite large funds in environmental protection technologies.


Odesa Sea Port Authority


Odesa sea port Authority is ready to take on the role of the cruise direction moderator of the International Tourism Week in Odesa in April 2020

The meeting of the working group on tourism development at the Odesa City Council was devoted to summing up the ‘high’ tourist season in Odesa in 2019, as well as preparing for the events of the annual International Tourism Week in Odesa in April 2020 and the pressing problems of developing the tourism infrastructure of South Palmyra. A meeting with representatives of tourism companies, hotel and restaurant business organizations, and specialized educational institutions was held today, January 20, under the chairmanship of Tatyana Markova, head of the Culture and Tourism Department of the Odesa City Council. The port of Odesa was represented by Ruslan Sakhautdinov, general manager of the Odesa branch of the State Enterprise ‘Ukrainian Sea Ports Authority’ (OB SE ‘USPA’).


In his speech, R. Sakhautdinov underscored a number of port workers’ ideas in the context of accepting and servicing cruise tourists. General manager of OB SE ‘USPA’ also suggested continuing the practice of joint participation of the port and the city in Seatrade Cruise Global and Seatrade Med, prestigious international cruise exhibitions and conferences.


‘According to the experience of participation in the previous exhibitions, when the port presented opportunities for accepting cruise ships and the city representative presented tourist infrastructure - attractions, popular excursion programs, theaters, and restaurants - this made a good impression on our partners of cruise line operators and gave a real result: an increase in applications for cruise ship calls to the Odesa port,’ said R. Sakhautdinov.


Today, the meeting of the working group at the Odesa City Hall also agreed to include a complex of issues of cruise line development into the agenda of the International Tourism Week in Odesa. The port Authority is ready to take on the role of a moderator of events on such topic.


Finishing his speech, R. Sakhautdinov thanked the city and the regional authorities for the fruitful cooperation and coordination with the port Authority in tourism development. He also expressed the preference for the Odesa International Airport, which has become one of the largest and most modern airports in Ukraine in recent years and plays an increasingly important role in the development of tourism and business ties between Ukraine and abroad, to become a full-fledged and active subject of this cooperation.


Odesa Sea Port Authority





Tradition’s tenth birthday. Epiphany bathing on the berth No. 17 of Odesa port

On January 19, the Epiphany day, a festive liturgy was held in the St. Nicholas (Primorski) church on the territory of the passenger terminal of Odesa port, and a baptismal font was arranged on the berth No. 17, the so-called Jordan. For the bathers` convenience, two wooden cradles with a railing were fixed at the cordon of the berth. Next to the font, there were two changing rooms (male and female). The safety of the event was provided by port rescuers, representatives of the diving service and the medical unit.


Hundreds of port workers and citizens took the opportunity to plunge into icy water with faith in spiritual cleansing and the hope of strengthening physical strength.


The tradition of baptismal bathing at the passenger terminal of Odesa port is 10 y. o., the first one took place on January 19, 2010. Every year, the number of people wishing to undergo this ceremony at the sea port is increasing.


Press Service of Odesa Sea Port Authority


















Exclusive interview of Raivis Vetskagans, Acting Chairman of the SE ‘Ukrainian Sea Ports Authority’ to the agency ’Interfax-Ukraine’

How do you evaluate the 2019 results for the port industry and what forecast do you have for 2020?

It was a record year for the industry. Operating sea ports, except for those remaining in the Crimea, set a historical record of transshipment - 160 million tons. More than a ten-year maximum was exceeded in container handling - ports processed 1 million TEU. Among the significant events, of course, it is necessary to note the entrance to the final stage of pilot concession competitions on state stevedores in Olvia and Kherson.

It is a pleasure that our systematic approach to port development is working. In 2019, one of the most powerful and modern grain terminals in Ukraine, Neptune, began operating in the Pivdenniy. Over 500 new jobs have been created in the industry. To make this project happen, USPA completed a major dredging project in 2018: creating depths and water areas where they were virtually absent, investing more than 1 billion UAH. In addition, the approach channel of the port has already been brought to a depth of 20 m, without this talking about the further development of the water area at the depth of the port would not make sense. Now, these projects can be implemented. Similarly, we are doing in Mariupol. After the dredging began, draught in the port raised three times and reached 8 m. This makes logistics in the Ukrainian Azov more profitable. Moreover, in a few weeks, we`re planning to complete the reconstruction of the berth No.4 in Mariupol. Under the new grain terminal, too.

In 2020, a number of important systemic decisions, which will depend on the development of USPA and the industry will be adopted at the state level. This includes the issue of corporatization of USPA, creation of a new regulator for transport, signing of contracts with concessionaires and preparation of new projects, definition of rules for the development of domestic waterways. In addition, overcoming the existing ‘narrow corridors’ in logistics requires the implementation of large-scale projects, both for individual types of transport and those at the intersection of logistics destinations of ports, rivers, rail and road transport.


In 2019, USPA actually had to work without an approved financial plan. How did it affect the work of the company?

Of course, the approval of the 2019 financial plan in December this year is not normal. Why did it happen? There are a number of factors here: changing the dividend rate from 50% to 90% for the third time in the last three years; transition of USPA to the international standards of financial reporting and, as a consequence, change of approaches to the financial accounting and planning. The first draft of the financial plan was ready in time - at the end of 2018, but then we had to make adjustments to it more than 10 times. The attempts of the business to push interesting projects for them to the detriment of what USPA planned to make in 2019 played its role. And, of course, the election race and the change of government played a role. An already difficult path of harmonization had to be gone through again.

The process of approving a financial plan of state-owned enterprises in Ukraine is incredibly bureaucratic and therefore ineffective. Ministries sometimes pursue opposite goals. One is to increase the financing of investment projects, the other is to maximize budget revenues. I believe that in the future, the authority to approve the financial plan should be transferred to the supervisory board. This will make the process of adoption of the document more predictable and focused on the tasks of the enterprise for the development of the industry. Only then USPA will be able to properly plan projects together with investors, guarantee timely payments to contractors and not stretch projects for years.

Though there was no financial plan, in 2019 we succeeded to give good results. Last year, we increased funding for passport depth support projects by more than five times. In fact, during three years of my leadership, the dredging volume carried out by USPA made 70% of the total dredging done since 2013, that is, since the establishment of the enterprise. We have reached a record level twice, over 7 million cubic meters: in 2017 (mainly due to capital dredging at the port ‘Pivdennyi’) and in 2019 already at the expense of operational dredging at seven of the thirteen ports and on all channels where the USPA is responsible for maritime safety.

In addition, we doubled to 218.5 million UAH funding for its own fleet repair. We had to thoroughly invest in the vessels that we had taken from Ukrvodshlyakh in a rather pitiful condition. More than 10 vessels were repaired in 2019. This year, we began dredging at the Dnieper reservoir cascade for the first time in six years. Now this work is mainly executed by contractors, but this spring, as repairing equipment is being output, the capacity of the in-house fleet of specialized branch ‘Dredging fleet’ of USPA will increase four times. The result will be the following: faster speed, cost savings and more work.


Then why is the business criticizing your idea to buy a new dredge pump?

I regard such statements of business as manipulation with the only purpose of ‘flooding’ the necessary state purchase to try to redistribute money to projects which benefit individual companies. Obviously, growing the capacity of its own fleet is an urgent need of USPA. Look, the annual sediment accumulation of Ukrainian canals and water areas is 6.8 million cubic meters, and the fleet capacity is 3.7 times less. In this case, the services of contractors are 2-4 times more expensive than the dredging operation with its fleet. According to preliminary estimates, the purchase of a new dredge pump will allow USPA to save more than 400 million UAH a year.

And finally, we are less dependent on geopolitics and economic disputes for contractors if we have our fleet. Remember, we could not find a contractor for more than a year in Mariupol and Berdyansk because companies did not want to risk and run their vessels under the Kerch Bridge? And in Mykolaiv the courts between the bidders generally blocked the beginning of dredging works for almost a year.

Therefore, one of the KPIs for USPA in the next few years should be to reach the volume of dredging with its own fleet at the level of 7 million cubic meters. As a result, the company will be able to close its own issues of operational dredging, taking into account the annual sediment accumulation of canals and water areas, and to attract contractors for the capital dredging implementation.


When it comes to dredging, why do law enforcement bodies periodically accused these tenders of corrupting?

Corruption news about the implementation of dredging projects, which from time to time is reported by the NACB in the media, refers to the previous authority. It is not difficult to check if you read the content of news and official communications.

My approach to tendering is simple and transparent, and it is also brought in from my European practice -maximum information on future projects per year to all participants of the dredging market both in Ukraine and abroad. Then, there was an open competition in Ukraine, at the ProZorro site. Most of the world's leading dredging companies took part in the tenders of USPA for capital dredging at the ports of ‘Pivdennyi’ and ‘Chornomorsk’. The winner was China's state-owned China Harbor Engineering Company Ltd (CHEC), the world's second-largest dredging company. And the savings on tenders for projects in two ports amounted to more than 500 million UAH.

If you think that foreign companies dream of working in Ukraine, then no. To execute the contract of the winning company, you need to overtake special equipment in the Black Sea, and in here the amount of work is very small compared to other seas, and if you do not plan to continue working here, it is simply unprofitable. In addition, the terms of contracting in Ukraine are very far from world practices - they are too bureaucratic and surprise contractors who are accustomed to working in Europe's leading ports. This could be confirmed by a representative of any of the world`s leading dredging companies. We have discussed this with them many times.


But at the end of 2019, there was a series of dredging searches at the ‘Pivdenniy’ and ‘Chornomorsk’ ports at the USPA offices ...

Yes, tenders for capital dredging at the ‘Pivdenniy’ (then still "Yuzhniy") and ‘Chornomorsk’ ports were held shortly after I became the head of USPA. And the level of control by the ministry, the expert community, the public and the media in the history of modern Ukraine can be compared with the re-privatization of Kryvorizhstal.

Holding open international tenders in ProZorro has enabled leading dredging companies such as DEME Group (Belgium), Boskalis International BV (Netherlands), Jan De Nul NV (Belgium), Van Oord Dredging and Marine Contractors BV (Netherlands), and CHEC (China's largest state-owned company) to participate in these tenders.

In this case, the contractor not only did not receive more money, as stated, but also gave us the opportunity to save on the completion of works. The state received more than 100 million UAH of savings at ‘Pivdenniy’ on two projects after the end of dredging. To understand the scale, CHEC's worldwide order portfolio exceeded $ 16 billion last year. Unlike some companies that apply to us for tenders with a statutory fund of several thousand UAH.

However, the legitimacy and benefits of dredging contracts at ‘Pivdenniy’ for the state and USPA confirm not only the figures given by me, but also the decisions of the courts. For two years, some Bastin Consulting LTD, which did not participate in the tender, tried to challenge the results of the tender at ‘Pivdenniy’ port in court. As a result, all three instances (economic, appellate and cassation courts) found no violations during the tender and declared the contract with CHEC valid.

The Chinese company has recently expressed its astonishment over allegations of abuse at the ‘Pivdenniy’ and ‘Chornomorsk’ ports projects. Considering that Ukraine is very interested in Chinese investment and has, excuse me, shameful experience on Air Express projects and SFGCU, it should be more prudent to make such accusations against China.


Why is USPA unable to stop the corruption of environmentalists in ports?

Environmental corruption can only be stopped by law enforcement bodies of the highest level. We have done everything necessary to establish clear frameworks at the state level that on the one hand protect shipowners from unjustified fines, on the other they provide punishment for those who really pollute the ports’ water area. The AMPU, together with the State Regulatory Service, Business and Profile Associations, have developed appropriate procedures that clearly regulate: who identifies the contamination, what further actions each of the services should take and analyze the samples. It is now important to ensure that everyone adheres to those rules which simply did not exist before.

Do not forget that ships are not the main pollutants in ports. Sewage collectors and sewage drain water their waste in the harbor. This is a huge problem, which the city authorities is primarily responsible for. Over the last year there has been progress in finding solutions with the authorities of Mykolaiv and Odesa. However, this is only the beginning, Ukraine needs to address this issue at the state level, and perhaps involve international technical assistance.




And what about allegations of abuse of line discounts for Portinvest Logistics?

I will say it this way: USPA does not give anyone any preferences for port fees, we do not have such powers. All discounts are approved and provided in accordance with the order of the Ministry of Infrastructure #316 by 2013, and the procedure for line registration is determined by the instruction, also approved by the order of the Ministry #790 by 2013. It clearly states what the criteria are for the line to be eligible for discounts. In addition, the State Service for Maritime and River Transport, the so-called Moradministration, is empowered to register foreign navigation lines and control their operation.

USPA is the executor who receives the necessary documents from the applicant, prepares the presentation and submits them for consideration and approval to the Moradministration. Accordingly, if Portinvest Logistics lines were registered, then they, like 80% of other lines registered and operating today in Ukrainian ports, meet the requirements of the law. I think that in the case of the USPA preference charges, there must be commercial interest in this particular line of one of the competitors directly in the ‘Pivdennyi’ port. As the Minister (Infrastructure of Ukraine Vladislav Krykliy) pointed out, in the port market, some companies monitor other`s businesses better than their own.

Another important point to understand such fake statements is that it is not the agents who receive the discount, but the vessels. After all, the disbursement bills issued by USPA are paid by the shipowners or charterers of those vessels that enter the ports of Ukraine. And in the case of the line, the discount is also received by the shipowner and no one else. This principle works around the world, including aviation: discounts on the line gets the owner of the aircraft, not its agent.

Conditions of attracting vessels to operate lines in Ukrainian ports can and should be improved and developed. Based on the experience of European ports, the discounts for them may be even higher than those provided today. But the priority should be regularity and number of vessel activities, volume of freight transported to and from ports during a month, a quarter and a year. This, on the one hand, will stimulate to attract guaranteed freight for stevedoring companies, and on the other hand, will make the motivation for such discounts clear and transparent.


Let's talk about your future work plans. The Ministry of Infrastructure has recently announced a competition for the position USPA Chairman. Will you participate?

I can say that temporary status imposes significant restrictions on the work of the head of any company. First of all, it affects the efficiency of enterprise management right to the labor discipline. Projects of the port industry are long-term, and when you try to move them from the track of the post-Soviet routine to sound European rails with clear requirements in terms of timing and efficiency, many people think that this is all temporary and they just need to wait a bit for another appointment and then they will be able to go on to do the old way. The era of acting must finally come to an end. I am fully agree with the Minister here.

But I will not participate in the competition. Unfortunately, there are no prerequisites and conditions to allow me to fulfill the professional tasks that I see for myself in this position, in order to rebuild the Ukrainian port industry according to the best European models, which I was actually invited for. During all three years, I periodically confronted with the situation when the remarkable state-level statements and initiatives on the necessity for long-term infrastructure development crashed over governments' task of filling the country's budget here and now.


Does it relate to the dividend policy of the state?

And including this.


What are going to do next?


Despite all the difficulties, I love Ukraine very much. It is an interesting, very promising and amazingly dynamic country. I am sure that the port industry and logistics in general will be actively developed here, in spite of the problems persisting with management in the public sector. Investors, cargo owners, banks will be the drivers of this process.

In my opinion, the main tendency in the coming years will be further integration between the transport network of Ukraine and the EU. And my experience in both markets and business models will be very useful here. That is why I remain working in Ukraine. Most likely, it will be the private sector.


What challenges do you think the winner of the competition will have to face with?

The first one is the financial and political independence issues of the enterprise.

Last three years we at USPA have done a lot to transfer the enterprise management system into the world`s common corporate standards. They laid the foundation for the future independence of the enterprise and its stability even in the face of political turbulence.

The state has finally formulated a property policy for USPA. A Supervisory Board has been established, consisting of independent members with the industry world-renowned experts from Belgium, Germany, and the Netherlands. The Corporate Governance Code of the enterprise has been developed, the process of discussing the draft law on corporatization of USPA is under discussion. All this puts a clear framework for the Authority`s movement to the best global standards of management. I sincerely hope that the USPA management reform that we initiated will be completed, solving most of the existing problems.

In fact, I am talking about minimizing the political and bureaucratic influence on the work of the company and appointing the top management of USPA and the branches. I managed to launch the first open selection for the branch managers` positions at the end of 2019. The Ministry of Infrastructure has already approved their winners. The next important step is competition for the position of Head of USPA held by the Supervisory Board. The expansion of the Supervisory Board functions and its further active participation in the work of the enterprise will make the KPIs fulfilment the main criterion for the personnel policy. And let quotas, behind-the-scenes arrangements and appointments of "your" people stay in the past. I would like it both for the enterprise and for the industry.

The issue of financial independence for the new leadership will also have to be resolved. Maintenance and modernization of berths, overpasses, roads, railways in ports, dredging projects cost tens of billions of hryvnias, which USPA simply does not have. But, at the same time, a completely clear and elaborate set of steps will be taken to allow to increase the investment resource of USPA and to diversify its costs.

The first is that the USPA Corporatization Bill provides for the approval of a dividend amount to the budget of 30% instead of the current 90%. And not for one or two years, but on a regular basis. If Ukraine wants to have a strategic infrastructure, berths and water areas and compete successfully in this market, the primary task of USPA should be not to transfer money to the budget, but to implement projects with synergistic effects: creating jobs, increasing volumes and productivity of transshipment, development of related industries and, accordingly, tax deductions. Nowhere in Europe port administrations pay dividends of 90% of profits. And, for example, in Latvia they are exempt not only from dividends but also from income tax. As a result, they have the opportunity to reinvest profits into infrastructure development.

The second is the creation of an effective mechanism for the transfer of berths to concession or lease to a private business with a prerequisite to invest in their retention and modernization on an irrevocable basis. If the government does not want the berths in the ports to be the same as the locomotives on the railway, this must be addressed immediately. After all, neither USPA nor the state will soon have sufficient funds to maintain more than 260 berths in working order. What to do in Ukraine with ports is clear, but for some reason it is necessary to constantly overcome the bureaucracy and inertia of the system.


‘There is a great space for collaboration’ A delegation of European business circles paid a visit to Odesa port

The capability of Odesa port for export-import cargoes transshipment and plans for the development of the enterprise in the light of the public-private partnership projects implementation were discussed yesterday, January 15, at the meeting of general manager of the Odesa branch of the State Enterprise ‘Odesa Sea Port Authority’ (OB SE ‘USPA’) Ruslan Sakhautdinov with a delegation of European business community, led by Martin Guillermo Ramires, Secretary General of the European Cross Border Regions Association. The negotiations were also attended by Denis Karpov, deputy general manager of the OB SE ‘USPA’ on operational services, and Svetlana Yarovaya, Vice President of the company SE ‘CTO’.


The meeting was initiated by the SE ‘CTO’, a subsidiary company of the German logistics concern HHLA, which operates a container terminal at the Quarantine mole. According to the results of work in 2019, the CTO team retained the position of the leader in the domestic container transshipment market: the company's dockers achieved 389.9 thousand TEU, which exceeds one third of the volume of containers handled in Ukrainian ports last year.


At the negotiations in the port administration, the parties discussed urgent issues of developing a business partnership between the SE ‘USPA’ and European companies, the problems of attracting private investments, the introduction of alternative energy sources, etc.


‘We are now actively studying the experience of European countries where infrastructure is developed and modern approaches have been generated in terms of ecology, preservation of roads, development of combined transport in the river-sea traffic,’ R. Sakhautdinov noted in his speech. ‘An example of Odesa port operation shows a significant increase in the arrival of goods to terminals by domestic waterways. But the growth rate is not yet sufficient. Cooperation and coordination of efforts of the enterprises of the maritime industry, business, public organizations, including international institutions of cross-border cooperation could significantly accelerate the development of such transportation. The space for collaboration is great...’


Martin Guillermo Ramirez, in his turn, thanked the authority of the port for the opportunity to visit the largest container terminal in Ukraine and for the informative round-table discussion. The parties exchanged contacts and expressed mutual expectations about the establishment of cooperation, which will contribute to the strengthening of economic activity and include an increase in employment and the welfare of Odesa region population.


Odesa Sea Port Authority