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THE UKROBORONPROM MANAGEMENT DISCUSSED CHANGES WITH THE AMERICAN ADVISORY GROUP

THE UKROBORONPROM MANAGEMENT DISCUSSED CHANGES WITH THE AMERICAN ADVISORY GROUP THE UKROBORONPROM MANAGEMENT DISCUSSED CHANGES WITH THE AMERICAN ADVISORY GROUP The new team of Ukroboronprom has met with the representatives of the advisers group of the Institute for Defense Analyses of the USA. Previously, the group experts made a nearly 2-weeks visit to the enterprises-members of Ukroboronprom in Kyiv, Zhytomyr, Lviv and Kharkiv regions, where they could evaluate their productive capacities and efficiency. ПDuring the meeting, the parties paid special attention to discussing financial and economic issues, the results of the activity of the state-production component of the Ukrainian defence industry, as well as further plans of transformational development of the enterprises-members of Ukroboronprom. “Our goal is to transform Ukroboronprom into an effective administrative body of defence industry state enterprises – they must meet the needs of our army and be cost-effective. To achieve this we cooperate with the international partners, analyze and choose the world's best solutions”, - said Roman Bondar, Deputy Director General for Transformation of Ukroboronprom. He added that digitalization and intellectual property protection would be one of the drivers of changes at the enterprises. In addition, Ukroboronprom will improve working conditions and strengthen social security of its employees. The issues of concern of the Ukroboronprom initiatives were updated during the discussions, including increase of transparency of the state defense order due to the expected changes to the legal acts, transition of all enterprises-participants of SC "Ukroboronprom" to open procedures for selection of suppliers using the system of public procurement “Prozorro" from 1 December 2019, the course of the financial audit, as well as other transformation processes, including the ways to corporate governance. It should be recalled that the advisory group of the Institute for Defense Analyses, headed by the Strategic Level Advisor on the Reform of the Defense Industry of Ukraine, Dr. Donald Charles Winter, formerly Secretary of the US Navy, provides advisory assistance at the strategic level on the reforms and development of the Ukroboronprom enterprises-members protection. The group’s work, which began in February 2019, was initiated by the country's leadership request to the US Secretary of Defense James Mattis during the visit to the United States in September 2018.

PLANT “MAYAK” PROPERTY COMPLEX PROTECTED FROM ILLIGAL SALE

PLANT “MAYAK” PROPERTY COMPLEX PROTECTED FROM ILLIGAL SALE PLANT “MAYAK” PROPERTY COMPLEX PROTECTED FROM ILLIGAL SALE The Court of Holosiiv District has protected the PJSC "Plant "Mayak" from the forced sale of real estate at a reduced appraised value by the state executor.  The transport workshop of the PJSC "Plant "Mayak" was put up for sale at the SETAM e-tendering system with the auction date set for 28 November 2019 at a starting price UAH 100 million lower than its market value.   As a result, Ukroboronprom appealed to the law enforcement agencies with a report on a criminal offense. Today the Prosecutor’s Office of Kyiv has prevented the illegal alienation of the Plant “Mayak” state property complex. “At the request of the Prosecutor’s Office of Kyiv, the Holosiiv District Court of Kyiv seized the Ukroboronprom PJSC "Plant "Mayak" state property complex with a total area of about 20.000 square metres to prevent its sale at the auction of the SE “SETAM” at the reduced initial costs”, - the prosecutor's office said. According to the information provided by the Ukroboronprom, in the course of criminal investigation into the organization of fraudulent scheme for sale of the PJSC "Mayak Plant” property, it was found that the former official of the enterprise promised the commercial structure representative to assist in the purchase of the specified complex through the SETAM e-tendering system. The fraudulent scheme was exposed and its organizer was detained. It should be noted that earlier at the appeal of Ukroboronprom to the Supreme Court, the decision of the Kyiv Court of Appeal for which the property was tried for sale was appealed in cassation. The Concern thanks the law enforcement agencies and the State Executive Service of the Ministry of Justice of Ukraine for their prompt action and protection of the state enterprise property from unlawful alienation.

PURCHASERS OF UKROBORONPROM LEARNED TO WORK PROZORRO

PURCHASERS OF UKROBORONPROM LEARNED TO WORK PROZORRO PURCHASERS OF UKROBORONPROM LEARNED TO WORK PROZORRO The procurement specialists of the Ukroboronprom enterprises-members have completed their trainings for transition to work with Prozorro. The event was led by Procurement Director Nadiia Bihun in order to teach people to work with this system and to fully transit the acquisitions of the Concern enterprises to Prozorro from 1 December 2019.  “As Prozorro works on “an all-seeing-all” principle, for us the transition to the open platform is a very important step to clear procurement process against corruption risks. The purpose of this training is to implement new procurement policy through Prozorro. In my opinion, the lively discussion format has the greatest effect as each participant may ask questions and comment some important issues”, - says Nadiia Bihun.   She noted that the purchasers of Ukroboronprom and most of its enterprises-members are already successful in making procurements through e-tendering platforms and know how to use the particular instruments. With the transition to Prozorro we will involve to the procurement process bigger number of suppliers and will get the best prices at the open, competitive market. The training was attended by 87 specialists from 71 enterprises-members of Ukroboronprom. On the whole the Ukroboronprom enterprises purchase over UAH 4 billion annually. These purchases will become open and clear to everyone – this is the position of the new Ukroboronprom team. It should be reminded that Ukroboronprom has already adopted a new provision on threshold procurement – from now on, the purchases of the Concern over UAH 25 thousand will be obligatory carried out through Prozorro – and has initiated the procedures of transfer property for rent transition to Prozorro.Sales for its 118 state enterprises-members.

NADIIA VASYLIEVA WAS APPOINTED AS DEPUTY DIRECTOR GENERAL FOR DIGITALIZATION AND INNOVATION OF UKROBORONPROM

NADIIA VASYLIEVA WAS APPOINTED AS DEPUTY DIRECTOR GENERAL FOR DIGITALIZATION AND INNOVATION OF UKROBORONPROM NADIIA VASYLIEVA WAS APPOINTED AS DEPUTY DIRECTOR GENERAL FOR DIGITALIZATION AND INNOVATION OF UKROBORONPROM Director General of Ukroboronrpom Aivaras Abromavicius appointed Nadiia Vasylieva as Deputy Director General for Digitalization and Innovation of the Concern. The main task is to create an innovative ecosystem for the military industry based on Ukroboronprom. The main directions of its implementation should be noted: 1. Digital transformation of the enterprises-members of the Concern, which means creation of customer-oriented innovations in products and processes, as well as creation of new flexible business models of development and production in partnership and cooperation; 2. Construction of a virtualized Joint Competence Center with the Scientific and Technical Council with sectoral directions inside, which should strengthen the work of design bureaus and enable commercialization of innovations; 3. Preparation of technology transfer for joint ventures and the possibility of rapid implementation of innovations with the involvement of research institutes, startups, scientists, innovators, inventors; 4. Creation of a cyber-subdivision that will build new products based on data or using it; 5. Implementation of project activity on the basis of flexibility and efficiency, as well as development of a modern communication system. Nadiia Vasylieva is PhD in Economics as well as a Master in International Law, holds a postgraduate degree in marketing of British CIM and held an EMBA, is a graduate of American MIT in Digital Transformation. She was the CEO of “Microsoft Ukraine”.

IN MACHINE BUILDING PEOPLE DETERMINE EVERYTHING – ROMAN BONDAR

IN MACHINE BUILDING PEOPLE DETERMINE EVERYTHING – ROMAN BONDAR IN MACHINE BUILDING PEOPLE DETERMINE EVERYTHING – ROMAN BONDAR People are most important in machine building. If these people create new technologies, they need to be implemented quickly. Otherwise, we come back to the fact that all our pride is the Soviet designs. This was emphasized by Roman Bondar, Deputy Director General of Ukroboronprom, in the interview with Mind. One of the main problem with the lack of engineers at the state enterprises is law salaries. International competing companies offer much more.  “The salary of constructors at one of our main enterprise is UAH 15 000, and two blocks away there is a foreign company which created R & D-center, and they offer a salary of UAH 75 000”, - Roman Bondar has commented.   Therefore, to fight for engineers for Ukroboronprom it is extremely important to be able to compete with the companies that provide their specialists with standards, technologies, English training and in five time higher salary. A positive example of effective management and professional engineers’ involvement is the State Kyiv Design Bureau “Luch”. The enterprise manufactures missiles, and it is ahead of the technical characteristics of many international analogues. The recipe for success is simple: Oleh Korostelyov, talented general designer, has assembled a team, who has a clear purpose – to create the best missiles in the world. Based on the production shop, the general designer has created a certain semblance of mass production to manufacture the missile samples that are in demand at an exponential rate. An average salary at the enterprise is UAH 59,000.

OLEKSANDR BERCHII WAS APPOINTED AS THE DIRECTOR ON CORPORATISATION OF UKROBORONPROM

OLEKSANDR BERCHII WAS APPOINTED AS THE DIRECTOR ON CORPORATISATION OF UKROBORONPROM OLEKSANDR BERCHII WAS APPOINTED AS THE DIRECTOR ON CORPORATISATION OF UKROBORONPROM Aivaras Abromavicius, Director General of Ukroboronprom appointed Oleksandr Berchii as a director on corporatization of the Concern. The main task is corporatisation of the defence industry concern with a purpose of creation a transparent, clear and effective structure with modern approaches to corporate governance. The main directions of its implementation are the following:  - Careful approach to privatisation, assets optimisation that will provide additional internal resources of development with the consideration of responsible social protection of employees; - Enhancement of intellectual property protection; - Development and modernization of technological and design potential; - Establishment of corporate governance in subordinated joint-stock companies that will be focused on the result, not the process; - Close cooperation and effective coordination between management teams within the Ukroboronprom, public authorities and the public aimed at the rapid implementation of changes. Oleksandr Berchii hold a position of the audit director at Ernst & Young, one of the “The Big Four”, the world's largest audit firms. He has more than 17 years of working experience as an auditor, specialized in dealing with socially important public sector enterprises.

THE FIRST FINANCIAL AUDIT OF UKROBORONPROM WILL BE FINISHED WITHIN A YEAR

THE FIRST FINANCIAL AUDIT OF UKROBORONPROM WILL BE FINISHED WITHIN A YEAR THE FIRST FINANCIAL AUDIT OF UKROBORONPROM WILL BE FINISHED WITHIN A YEAR Aivaras Abromavicius, Director General of Ukroboronprom, in an interview with Ukrinform told about the consolidated financial statements of Ukroboronprom for 2018-2019 on the international financial statements.  On October 1, the winner of the financial audit tender, which will last 12 months, was selected. The results for 2018 are expected to be in the first half of the next year, and for 2019 – in the second half of 2020. Financial audit is required, in particular, for the company to enter the foreign loan markets. Three years of international financial auditing allow companies to enter the foreign loan markets, issue Eurobonds, reduce the cost of the loan portfolio. "Now the cost of the loan portfolio is UAH 10 billion. Unfortunately, our average rate remains at the level of 21-22%, which makes the business extremely difficult. Since the payback of most projects, of course, is not so short (about four years), it does not allow you to invest in long-term projects. And when you issue Eurobonds in currency, we are talking about 6%, 7%, 8%. This is another matter and this is one of the reasons, why you need a financial audit,"- said Aivaras Abromavicius. The financial statements also provide an opportunity to enter into the projects with global giants who want to deal only with the companies whose financial statements have been audited according to the international financial standards. 

UKROBORONPROM AND AVIATION WORKERS’ TRADE UNION HAVE SIGNED THE MEMORANDUM ON COOPERATION

UKROBORONPROM AND AVIATION WORKERS’ TRADE UNION HAVE SIGNED THE MEMORANDUM ON COOPERATION UKROBORONPROM AND AVIATION WORKERS’ TRADE UNION HAVE SIGNED THE MEMORANDUM ON COOPERATION To fulfil the instructions of the President of Ukraine Volodymyr Zelensky on preparation of the State Target Scientific and Technical Program for 2020-2030 the State Concern “Ukroboronprom” and Aviation Workers' Trade Union have signed the Memorandum on Cooperation. This decision ended the meeting conducted on November 11.   “Ukroboronprom economic policy is focused on increasing production volume, generating income, modernizing manufacturing facilities and ensuring product competitiveness by analyzing the welfare of the aircraft and missiles industries employees. Our goal is to reform the industry with a view to rapidly increasing its performance”, – said Ruslan Korzh, Deputy Director General for Aircraft and Missiles.  Yarema Zhuhaievych, the Chairman of the Aviation Workers' Trade Union stressed that the parties will take measures to optimize and increase the efficiency of production in order to improve the social and economic security of employees. During the meeting it was also stressed that Ukroboronprom together with the Aviation Workers' Trade Union will provide measures to prevent and counteract corruption and unprofessionalism by the management of the companies-members of Ukroboronprom.