Yesterday, local media followed one of Eastern Ukrainian town’s public transportation vehicles on its test ride along the newly laid trolleybus route #6.
With free fare for the pensioners and US5 cents (0,1% of minimum wage) per ride for the rest of the passangers, many Kramatorsk residents are happy with the prospect of saving a bit more as they travel to the railway station-adjacent market that offers cheaper food items than the other two major food marketplaces in the newer part of the Eastern-Ukrainian town of of this 150,000+.
Kramatorsk residents both in online and offline discussions express their surprise at the speed and efficiency with which a project with concrete, positive implications for the everyday life of the town dwellers was completed. Some experts reportedly estimated that it would take the municipal services up to a year to bring the project to completion.
They did it in 25 days, having reportedly saved 16 million hryvnia (USD 672,280) from the budgeted 35 million (USD 1,470,614). Almost like the proverbial Stakhanovites. Though, hopefully without the bad quality implications of the term.
250 coulmns were set up along the route. A power substation brought back to life. It used to cater for the Old City tram connection. That line was discontinued some 20 years back for fear of the Torets River bridge deterioration as an alleged result of trams crossing it.
17 kilometers of power cable laid in the same period. Ten passenger stops refurbished and two high-voltage towers erected instead of the previous ones that posed public safety risk.
Back in the day, plans to lay this trolleybus line were voiced by the local city authorities as a subsistitute for the tram line that used to serve local passengers up till 1990s.
In the early years of Ukraine’s independence, the tram line to the Old City was discontinued and — as per local gossip — the rails dismantled, sold and the proceeds of the deal pocketed by local bonzos.
Privately owned — and some argue, Kramatorsk elite-linked — marshrutkas have been serving the old tram route all the way till today, at current price per ride 3+ times higher than the municipality-subsidized trams and trolleybuses.
Out of 40-45 trolleybuses that Kramatorsk needs for an adequate mass transit service, only 25 are currently operational. In the 1980s (last Soviet decade), the trolleybus park consisted of 60 vehicles.
Some local residents say that throughout all these years post-independance the trolleybus line did not really interest those in power because — unlike, say, road construction — one can’t steal much public money from a trolleybus line — all the key construction costs are there on the surface.
So why did the city council eventually deliver what it clearly owed to the people of the Eastern Ukrainian town for all these years post independence?
Some cite the post-Euromaidan climate of greater public responsibility and transparency.
In 2014 Ukrainian municipalities purchased117 trolleybuses. Only half of them are new units. The rest are second-hand vehicles from the EU.
As Ukraine moves into its third year as a nation that insisted on its EU course, it remains to be seen what other timely social infrastructure improvements the national trend towards decentralization will bring to the Eastern Ukrainian communities.
How did you find out about the ES Build Expo in Shanghai in the first place? Why was the Ukrainian Union of Manufacturers of Building Materials and Products attracted to it? It is quite far from Ukraine.
Well, we monitor the exhibitions in China from time to time: the technology develops there very rapidly and the cost of these new technologies is often much lower compared to, say, Europe. Besides, green construction, energy-efficiency and sustainability — which this exhibition was about — have become not only trends but also the reality that bites. We have to re-think the way we use energy and resources in construction and production of building materials in Ukraine.
Is it a typical situation in your line of work as the Chief International Officer to visit concrete products manufacturers in China like Xuelong plant in Shijiazhuang, Hebei? Or is it a sign of growing interest among Ukrainian companies to partner with Chinese colleagues in the construction material sector? What are the benefits of such partnerships for both parties?
Yes, it’s quite common for us to assist Ukrainian companies with establishing economic ties with Chinese companies. We work on different levels: help with business communication and try to provide some essential business planning on the product or technology to be purchased from China. Mostly we do this when we are dealing with acquiring of new technology or production line because the amount of investments is quite high so you need to think and plan thoroughly. And this is the case when expert advice is welcome! And as for benefits, there used to be a time when you considered German or Italian equipment as the only one reliable, though quite costly. Not anymore — the Chinese have achieved a lot in production culture — and big European players are aware of that now. And at the same time the price for the production line can be 2-3 times cheaper than the one you might get from Germany, for instance. We also need to consider that in construction sector, technology is pretty simple. No doubt Ukrainian manufacturers should take a closer look at what China has to offer.
Was it a challenge to arrange such a visit to Xuelong plant remotely from Ukraine? Apparently the Chinese side was quite forthcoming!
It wasn’t a tough task. Our Chinese partners helped to arrange some travel issues and the potential partners from Xuelong Enterprise were really forthcoming: we felt very welcomed there! Besides China has been transforming stunningly fast. My last visit to this region was several years ago and this time I was pleasantly surprised by how tourist-friendly big Chinese cities have become. Although language still remains a big issue…
How did you find the issue of language? Is it imperative for Ukrainians to travel to China with their own Mandarin speaker as part of the delegation?
From my own experience, I would strongly advise to travel with your trusted interpreter (or have one in China) who knows about your business area and can do some basic business analysis in China. It’s not even a question of trust rather a question of professionalism and mentality. Sometimes you need to ask a Chinese person one question three times in a row but formulate it each time differently to get an answer! So it goes without saying that some communication difficulties and operational misunderstanding occur. But once you get used to it you will work out a system to do business with the Chinese smoothly.
Tell us more about the line in Shandong province and your overall impressions from the business visit?
Visiting an operating factory was an obligatory condition that we expressed to our Chinese partners. We wanted to see the production line in action. So they showed us the factory in Shandong province.
It is a rather new one and doesn’t run to full capacity yet. It was less than we expected. That underlined that you need to prepare your visits to China in an even more detailed way: studying technology, pictures, exchanging drawings and layouts. Because it’s still a long way to reach there, you’d better be well prepared to spend your time there in the most effective way.
How soon do you plan to be back in China with more business partnerships growing between the Middle Kingdom and Ukraine?
Actually we visit China quite often (exhibitions, company visits etc.) and this time around we also invited our Chinese could-be partners to visit Ukraine to see the production themselves and to develop an on-site-based offer for the production line. There’s a lot of work ahead…
Oleksandr Pietushkov, Chief International Officer at Ukrainian Union of Building Materials’ Manufacturers, continues to fill us in on Ukraine’s industry prospects on the international markets.
This month we caught up with Mr Pietushkov in Brussels where he and colleagues take part in a UFEMAT, a European merchants’ association, meeting to identify ways of integration with European constructors as far as energy-efficiency and sustainability are concerned.
First category roads with a central safety zone and 2-4 lanes in each direction amount to only 2,200 km (1,3% of the total hard-surface roads in Ukraine). Road density is 280 m per 1 sq.km. Whereas in the EU it is an average 1,8-2,0 km per 1 sq.km. Your country lives in a truly historical time. There is a huge anticipation of new projects coming up in the next five to ten years. Big projects require both patience and a belief in history. Which of these two does the Ukrainian business community lack more? How good are Ukraine's construction material manufacturers on the collaboration spirit, technocracy?
I believe we all are “anticipating” our future projects, so to say. But finally we start realizing that we have to count on ourselves first of all. This is the change that took place in Ukrainians’ heads lately. The Ukrainian nation has proven it strives for sovereignty and European values. So we can say now that we do believe in our future more strongly.
Constructors have been developing their capacities. Technical upgrade of construction industry is carried out using European and world-class technologies. This includes supply of equipment as well as setting up new production units. But we observe the process to go quite sluggishly. We still have a lot to learn to successfully implement the knowledge and expertise we get from the world leaders in the industry.
Yes, in fact we can say so for a specific segment in certain regions. However the increase was merely caused by the internal population displacement from Donbass (as a result of the ongoing war) and because of devaluation of the Ukrainian hryvnia. Once withdrawn from the banks, people wanted to keep their hryvnia savings safe by investing in real estate and stashing US dollars under their mattresses. Policy of the NBU — Ukraine’s central bank — also resulted in the recent real estate investment surge. But the commissioning of new housing dropped in 2014 from the 23-year high of 2013.
General construction volumes in 2014 were only 78,3% of 2013.
The fact that in 2015 our GDP growth forecast is minus 5-6% we do not expect positive dynamics in construction in 2015, regretfully. It will come as no surprise that the government doesn’t have money for roads and infrastructure — a usual driver for construction sector in a crisis — since it has to be spent on defence. [Ukraine spends$5-7 mn daily on war in Donbass.]
The good thing is that we have no choice but to consider thermal modernization seriously this year because these expenses for private sector are growing 3-5 times. This could give us some positive dynamics in renovations works.
What are the top three challenges facing construction product marketers in your part of the world?
I would say first is the challenge of manufacturers’ preparedness. To market their products in the EU and other non-CIS markets they need to comply with the regulations. And this process has just started. We don’t have enough authority and equipment to do all the testings, our legislation is being adopted to EU norms…so still a lot of work ahead.
Secondly, for political reasons we’ve lost a vast part of our usual market: Russia, Belarus, Kazakhstan, and we need to path our ways to “unknown” and unfamiliar markets. Which of course requires large investments and extra human efforts. I cannot think of the third one because our product itself in many ways is a very good and competitive one. And the potential for developing new products is huge, both domestically and abroad.
Over the last 50 years almost every successful US industry has found a way to climb aboard Moore’s Law of semiconductors and take advantage of its exponential growth curve. This has inevitably rewarded pure digital plays, such as the internet, while only conferring partial advantages on physical – analog – industries: medicine, automobiles and construction. The IT industry in Ukraine is praised as a great investment opportunity. At the same time, the country needs big projects that tend to be very physical activities. Do you have the feeling that Ukraine's economy now directs smart players elsewhere to more immediate rewards?
You don’t need much investment to develop an IT business in Ukraine, really. You don’t have to invest US$30-40 millions into a new factory or infrastructure. You just use people’s brain and talent in the first row. This works well for a country that provides its citizens with a decent well-being level.
For Ukraine, IT — as well as agriculture — are additional drivers which can provide you with short-term rise. But you also must consider long-term. One job created within the construction sector generates three-four new jobs in other sectors of the economy, and let me repeat it again: the potential of construction market in Ukraine is really huge. We need to construct, modernize, restore and repair nearly everything and at a large scale: infrastructure and industrial facilities, housing and municipal buildings, social and cultural facilities. Again, more than half of deposits of rich mineral resources in Ukraine are not being processed and more of the working quarries need new technologies in processing. These will enable import substitution and growth in exports.
What can the industries in which you possess unique local expertise (construction, construction materials, agriculture, infrastructure) contribute to move Ukraine up in the investment attractiveness index in the next two-three years?
Actually these industries already do it. We are ready for joint projects and growth. I would rephrase the question to ask, ‘What do politicians need to do to stabilize the situation with the on-going war in the East and to provide speedy recovery?’
What are the two legislation decisions by Verkhovna Rada -- Ukraine's parliament -- that your industry awaits to boost investor confidence, reassure international customers and partners?
The main two issues that hinder development in Ukraine are corruption and current judicial system. Deregulation and decentralization reforms have been launched recently, but watch carefully the exact practical steps.
What are the top two practical outcomes of the Brussels trip that you can share with us?
We established contacts with the merchants for construction materials and second — but not least important — we clarified the strategy for ourselves: how to move further in technical regulations, investments, sales in construction and building materials sector.
The visits and meetings helped us to look at ourselves from a fresh perspective, to see things in a more realistic and critical way. Ukraine is regaining its sovereignty, striving for improvements in citizens’ welfare, developing the building and construction industry. We certainly build our Ukraine today but we have to scale up for a truly historical progress.
This week we were “utterly shocked” by the absence of cluster munition survival videos on the web. Check Google, YouTube. All you can get out of those communications is the utter shock of mutilation, death and devastation the murderers take pleasure in leaving you with. Georgia, Syria, now Ukraine.
Alright, shocked and killed we can easily be by just stepping out on the street. That’s not what we expect from the world wide web, folks! We look for life-saving information, we seek solutions to the problem.
As our town of Kramatorsk, Eastern Ukraine was shelled by heavy weaponry earlier this week, we wondered what the public security experience will be for those who survive the deadly attack by Smerch BM30 rockets. And — here and now — should we really care who launched them as long as we know how to dodge them?!
Okay, let the Kyiv- and New York-based journos speculate about geopolitics. From the safety of their homes.
Most messages beamed by the mainstream based-not-in-Kramatorsk media just drummed up the confrontation tune highlighting the — otherwise important facts that — cluster munitions are banned under international law and that Ukraine was shocked by the attack on a community “some 50 km behind Ukrainian lines and [thus] considered relatively safe before the attack.”
Some bits of life-granting solution communication came from the Governor of Donetsk Oblast Oleksandr Kikhtenko. At a press conference hours after the attack, he shed some light on the mechanics and electronics behind the killing power of 300 mm missiles — sure we all wish we knew that information much earlier; and the media is to still stamp the survival drill into our minds.
Some kudos also go to the Odesa Oblast Administration (Southern Ukraine) and the local news outlet here in Kramatorsk named Vostochnyy Proekt for sharing these bomb survival videos:
Sure thing, Ukrainians start to come out of the cluster munition attacks more resilient, survival tactics savvy. But like in any awareness raising/behavior change campaign having the right communication tools is as important as repeating the vital message a quadrillion times.
Problem reporting is so analog age. In the digital 21st century let’s finally start to think and communicate solutions, not just problems.
To our global reader out there, next time you are “utterly shocked” and think of launching a Twitter campaign — think @clusterbombsurvival not just @banclustermunition.