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MASS MEDIA ATTENTION!

In response to media inquiries about PJSC Motor Sich's possible nationalisation, in the development of which the DCH group is interested, we hereby publish the conclusions of the DCH Analytical Department.

If the current vector of events continues, it will most likely lead to PJSC Motor Sich's nationalisation. The nationalisation process will be legally complex, given the lack of the necessary legal framework for it in Ukraine and official Beijing's position.

As a result, all parties to the process will suffer the following damages.

  • Chinese investors of PJSC Motor Sich will be forced to complete international investment arbitration and, with a remarkably high degree of probability, they will win it.
  • The Ukrainian government will face the need to pay compensation in the amount of $3.6 billion or more. Moreover, with the need to make significant state investments in PJSC Motor Sich to maintain its performance – in the difficult financial situation of the state of Ukraine.
  • Bilateral relations between Ukraine and China will be seriously affected, the volume of Ukrainian exports ($7.1 billion in 2020) to China will significantly decrease.
  • The Chinese market will be completely lost for Ukrainian aircraft manufacturers; consumers will be reoriented to products of local manufacturers (including joint ventures with Western competitors of PJSC Motor Sich).
  • PJSC Motor Sich, in the absence of an inflow of investments (private ones are impossible and there are no state ones), will continue to degrade rapidly. Most likely, orders from Chinese buyers will be cancelled, and the company will de facto go bankrupt and leave both the national and international aircraft market. Following it, significant problems will be experienced by CB Ivchenko-Progress, FED, SE Antonov, which will ultimately lead to the destruction of the Ukrainian aircraft industry. The team of PJSC Motor Sich will lose their jobs, and we are talking about 17,000 jobs, which will seriously increase social tension in the Zaporizhzhia region and in the country as a whole.
  • The current buyers of PJSC Motor Sich products from India, Pakistan, Latin America, and the Middle East will switch to purchasing goods in Russia, the USA and Europe. In the Ukrainian market, the place of the enterprise will be taken by competitors from Great Britain, France, Germany, who enjoy the support of their governments. Highly qualified personnel who will lose their jobs will be in demand at enterprises in China, Russia, Turkey, and the Czech Republic. It means a drain of intellectual resources and unique working skills from the country.
  • Military-technical cooperation between Russia and China will become closer, which means additional threats to the national interests of Ukraine.
  • The Ukrainian authorities may shuffle off both moral and financial responsibility onto the US government. As a result, the US expects image losses both in the eyes of the world community and in the eyes of Ukrainian citizens.
  • The only beneficiary of the nationalisation will remain PJSC Motor Sich's current management, headed by the enterprise's actual head, Viacheslav Boguslaev. Moreover, even though it was they who, by their actions, caused damage to the state of Ukraine and its most important partners – the United States and China.

Given the situation, DCH's actions are aimed at minimising damage to all parties involved in the process of PJSC Motor Sich