The size of the Ukrainian leasing market more than quintupled in
2007 as the industry’s leasing portfolio rose to $3.8bn from $716m
in 2006, according to the latest findings by the International
Finance Corporation (IFC), the World Bank’s private investment
arm.
The number of active leasing companies increased 39 per cent,
driven by the higher interest in leasing by foreign-owned banks,
increased awareness of leasing, the rapid development of Ukraine’s
financial market and better access to credit.
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IFC has been providing assistance to Ukraine for the past four
years through the Ukraine Leasing Development Project. Its aim was
to facilitate the development of leasing through consultation,
training, and building business opportunities for local and foreign
investors. This year’s survey was the fourth and last as the
project draws a close.
In a poll of the 84 registered leasing companies—to which 61
responded—the IFC found that the structure of rail transport (52
per cent) and automobiles (15 per cent) continue to command a large
share of the industry’s leasing portfolio.
The report also pointed out opportunities in the underdeveloped
non-food production equipment, agricultural machinery and municipal
and freight transport sectors.
Ukraine’s leasing industry also stacked up well against other
emerging markets in Central and Eastern Europe. The volume of
leasing agreements made up 2.6 per cent of GDP, compared with 4.7
percent in Hungary or 1.1 percent in Russia. As a percentage
of capital investments, leasing makes up 8.8 percent in Ukraine, as
opposed to 31 percent in Hungary and 8 percent in Russia.
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By GlobalDataBut lessors still faced obstacles in access to funding, tax
legislation, lack of understanding of leasing amongst SMEs, lack of
secondary markets for fixed assets and underdeveloped credit
bureaus.
