Analysts’ forecast concerning the metallurgical sector in Ukraine in 2010

In the key economic sector of Ukraine – metallurgy, the stability of production, the volume, and costs have been watched over the last 2 quarters. In 2010, analysts expect positive dynamics of production restoration and an increase in sales mainly in priority markets such as the Middle East, North Africa, and the South East Asia. Main restoration drivers are due to the recovery of credit markets, increase in construction volume facilitated by growth of oil prices in the Middle East, realization of infrastructure projects, and government programs for engineering industry support.

Principal risks for the sector are laid in low domestic demand and a lively Chinese metallurgists’ entrance into the foreign markets whereas in 2009, they mainly worked for the domestic market. Considerable advantages of Ukrainian metallurgists are the supply of iron-ore and, low transport costs due to geographical location, whereas a disadvantage is recognized in technology compared to China. Raw materials imported to China (iron-ore and coke) are more qualitative and it has an effect on quality of produced metal – roll.

Summarizing all advantages and disadvantages of the principal sector one must bear in mind that there might be political support of our metallurgists in 2010 with unpopular for the public means as hryvnia devaluation.

Estimating the above mentioned risks for people and business, AMC “UkrSib Asset Management” offered to invest assets in a new investment fund “Acceleration” that avoids devaluation of the national currency and get currency risks hedging.

The assets will be invested in such financial tools as Eurobonds, bonds of internal government loan, money market tools and bank metals.

A closed-end non-diversified corporative investment fund “Acceleration” is the sixth market investment fund under the management of AMC “UkrSib Asset Management”. The investors of the fund are legal entities and individuals.

An issue prospectus of shares of the new investment fund – a closed-end non-diversified corporate investment fund “Acceleration” was registered by SCSSM on the 28th of October 2009 (SCSSM Certificate # 1604 from 28.10.2009).

Before the acknowledgement of the Fund the securities are sold at the nominal value.