This is the first global project with China, which is extremely interested in the Ukrainian market, Ukrainian experts think.
On August 6, 2020, on the Shanghai Stock Exchange, the Chinese Beijing Xinwei Technology Group Co., Ltd informed that the Beijing Skyrizon subsidiary and the DCH Group of Ukrainian businessman Aleksandr Yaroslavskyi submitted a new joint application to the Antimonopoly Committee of Ukraine to purchase shares of ‘Motor Sich’ engine plant located in Zaporizhzhia.
On the same day, Volodymyr Zelenskyi, the President of Ukraine instructed Denis Shmygal, Prime Minister to urgently take measures to protect the economic interests of the state together with the National Security and Defense Council apparatus and the Security Service of Ukraine. In particular, to ensure a comprehensive assessment of the state of activity of state property objects that are of strategic importance for the economy and security of the country, including the identification and elimination of factors blocking their work.
In response, Denis Shmygal expressed the point of view that the fate of the investment project should be decided in the courts.
‘Ukraine is a state with a market economy. Accordingly, the state cannot interfere in the sale of blocks of shares to some investors or the purchase of these shares by anyone. The decision should be made not by politicians, but by impartial institutions that are intended for this all over the world,’ said Shmygal.
At the same time, in the opinion of Viacheslav Lysenko, the founder of the ‘Ukr-China Communications’ Company, a promising opportunity has opened up for Ukraine to regain its leading positions in the world aircraft industry market. And for this, the President needs to make a willful decision.
All attempts taken by the Chinese to create their aircraft end in that they cannot create engines. Therefore, the Chinese market is interested in the manufacturing of ‘Motor Sich’. It would be strategically very important for Ukraine not to sell technologies, but to place them in Ukraine, receive ten-year huge orders and revive the capacities of ‘Motor Sich’. It is clear that we are a competitor to the American market. Therefore, in this situation, President Zelenskyi has to choose the interests of Ukraine and the domestic economy. With Yaroslavskyi's investment participation in the fate of ‘Motor Sich’, the chances of resuming manufacturing activities and active development of the enterprise are much more significant. For the Ukrainian economy, Zelenskyi's correct decision will become a small jackpot, which can grow into a massive jackpot. And if we show by a specific example that we trust Chinese investments, then the next steps of China will be investments in other industrial facilities, Lysenko commented.
The President is looking for a way out of the situation. The figure of Yaroslavskyi in a joint project with the Chinese removes the ‘political plume’ from Zelenskyi. It is well known that Yaroslavskyi's interest lies in the development of industry and mechanical engineering. The aircraft engine building is both an excellent investment opportunity and a chance to save a dying enterprise for him. Ukraine urgently needs to untie this knot, because without development and large projects in a few years, ‘Motor Sich’ and its technologies will become irrelevant,’ Volodymyr Tsybulko, political scientist, commented on the prospects of the Ukrainian-Chinese investment project.
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‘Motor Sich’ is one of the world's largest enterprises for the manufacturing, testing, maintenance and repair of 55 types and modifications of economic and reliable engines for 61 types of aircraft and helicopters for various purposes. The company was acquired by Chinese investors associated with Skyrizon in 2016, investing more than $100 million in the development of production. The investors intended to transfer 25% of the shares to the state voluntarily. However, in June 2020, Ruslan Korzh, Advisor to the General Director of the State Enterprise ‘UkrOboronProm’, said that the proposal was irrelevant.
