Tuesday, February 23, 2010

Price Discrimination Opportunity

"Donetsk Railway introduces separate compartments in trains for men and for women from March 30, reads a statement made by the railway's press service, a copy of which Ukrainian News has obtained.

"From March 30, as an experiment, passengers of trains formed by the Donetsk Railway will have the ability to choose from travelling in compartments for ladies or for gentlemen," the statement reads.

In particular, the service will be provided in train 88 bound for Luhansk - Kyiv, train 83 Mariupol (Donetsk region) - Kyiv, and train 120 Donetsk - Kyiv.

Tickets to such compartments will cost the same as ordinary tickets."



The Railway misses a great opportunity for price discrimination here as it could easily charge slightly more for separated compartments. Another question now is what will happen if the last empty place is in a women-only compartment and the last potential buyer is a man...

Saturday, February 20, 2010

The Danger of Being a Mono-City

A very interesting story of the rise and fall of a Ukrainian village - it nicely illustrates the dangers of mono-industry cities but also illustrates how hard it is for cities/village to completely die out.

"In Soviet times Stepnohorsk was a small populated area located about half-hour by bus from Zaporizhzhya where slightly over 1,000 people lived.

“Then it was a typical village whose inhabitants were mostly farmers,” Chair of Stepnohorsk Village Council Iryna Kondratyuk told Weekly.ua, “However, in the 1980s, deposits of high-grade mineral resources were discovered, which had no analogs in the country, I think.”

Literally within a few years, construction of two mines was in its final stage, the first processing enterprise was built and 9-story residential buildings were raised. The provincial authorities projected that by the end of the 1990s there would be around 75,000-100,000 residents, predominantly coal miners and employees at local plants and their families in the small town. The first new high-rise buildings were occupied mostly by young specialists from the north of Russia and provinces neighboring Ukraine.

...

In the mid-1990s, all Stepnohorsk enterprises were shut down. Everybody here knows about the reasons why the government made such a decision, but nobody likes to recollect them. “There is a similar deposit in the neighboring oblast, which was discovered much earlier than ours,” the local residents told Weekly.ua. “Our products were greatly competitive, which why we were shut down.”

As a result, around 10 thousand people remained in the town without work or money hoping that everything was just a grave mistake. The experienced specialists who for decades were recruited from across the entire Soviet Union had to leave with their families to earn a living in neighboring big cities or abroad."


The Benefits of Lobbying


"Parliament postponed a routine hike in the excise tax on cognac for a year. According to the government plan approved in late 2008, the excise tax on cognac and brandy should have been raised 40% since the beginning of the current year. Now this increase has been postponed
to January 1, 2011.
Cognac in Ukraine is produced by fourteen enterprises. They lobbied the deferral of the increase in the excise tax in the Verkhovna Rada. The threat of moving production of cognac abroad to Moldova has played a key role here. After all, unlike the producers of vodka, wine and beer, cognac producers could have easily carried out their threat seeing as most cognac spirits in Ukraine are imported anyway,” said Maria Kolesnyk, Director of the Analytical Department of the AAA agency. “Now, vodka could lose up to 15-20% of the market to cheap cognac that costs up to UAH 100 a bottle,” she added."


Friday, February 19, 2010

Who Benefits from Quotas?

clearly somebody...



"Only one company gets license for privileged sugar imports

KYIV, February 19 /UKRINFORM/. Only one company has received the license for preferential sugar imports under the quota of the World Trade Organization, President of the Ukrainian Agrarian Confederation Leonid Kozachenko has said, refusing to name the company.

Some 267,000 tons of sugar could be imported to Ukraine at a preferential customs rate of 2%.

The production of beet sugar of the 2009 harvest in Ukraine totaled 1.267 million tons. The domestic consumption of sugar in Ukraine is estimated at two million tons."



Thursday, February 18, 2010

Hostile Take-Over Ukrainian-style

A nice example of the dangers of doing business in Ukraine