Serhiy Taruta: “God gave Ukraine resources, as only five countries in the world”

Yesterday Ukraine celebrated the Day of workers of metallurgical and mining industry. This is the most important sector of the economy is now experiencing in the country is not the best of times in connection with events in Donbass. So, since March 30 due to the lack of raw materials and problems with funding stopped the Dnieper metallurgical plant in Kamenka, Dnipropetrovsk region.

However, now I am confident that the city-forming enterprise will be able to re-start. The guarantor of return of the plant to life and dealing with problems made the other day a prominent businessman and politician, people’s Deputy Serhiy Taruta. With him we meet on the eve of day of workers of the industry.

— Sergey, you is known to bind with the steel industry for many years working in different capacities: producer, Director, entrepreneur, and investor. Therefore it is appropriate to ask the question: what is the role of this sector in the modern economy, in particular, of our country?

— First, allow me through your newspaper to congratulate everyone who relates to metallurgy, on our professional holiday. I wish they were healthy so there was never a threat to their workplace to earn a decent salary and living in environmentally friendly cities, was happy at work and in the family, so we all together built the Ukraine and turned it into the most advanced and prosperous country. All happiness, love, and faith in our Ukraine!

To answer your question, I would say that, really, I’m only at the “Azovstal” worked for 16 years, then for many years was connected with the industry leading “Industrial Union of Donbass”. Notably, Ukraine was and still is an industrial country. And the few people God has given in this respect such as we have. There are only five countries in the world that have completely all the raw materials for steel production. Ukraine, China, Australia, USA and Russia. There are iron ore, coal, ferroalloys, fluxes, manganese, everything we need. And since God gave us this wealth, then you need to convert it to the wealth of the country.

Accordingly, the role of the mining and metallurgical complex (MMC. — Ed.) very powerful. Including terms of employment, because in metallurgy together with subcontractors 1 created about 200,000 jobs. But if times three, referring to family members, there are about 3 600 000 residents, almost one in ten. Normal, successful operation of the complex is the salary and social services for workers, taxes to the local budget, is filling the state Treasury. Because, I think, inappropriate at times encountered in the recent debate on the topic can Ukraine become an agricultural country? I will say that in the world there is no successful purely agrarian country.

Yes, the agricultural complex in Ukraine is good, has considerable potential, but mining and metallurgical industry has the potential for much more.

If we trace the evolution of many of the now highly developed countries such as Japan, Korea, Germany, USA, England, France, they all started with heavy industry, with steel production. Then came the development of mechanical engineering, created new jobs, developed science, and in General moving progress. There is even such an objective measure of development of society, as the amount of steel per capita. The state should contribute to this indicator grew to the country not only produced but also consumed within themselves all more metal.

It is clear that Ukraine needs to accelerate the development of the economy. Growth of GDP should range from 10 to 15 percent per year, there is no other way. This process will increase the role of the MMC. But if we talk about more distant future, in the General growth of the economy should decrease the share of industrial parts, and to grow the share of services. This is only possible with a significant increase in incomes. And this will lead to increased consumption of different goods, which drags again, the increase in metal production. In short, what metal is the Foundation of development of society, and he has no replacement.

Today, the MMC and its associated agencies provide in the budget of Ukraine about 40% of all revenues.

And a major donor of foreign exchange earnings to the country, the guarantor of the stability of the hryvnia, all the years of independence was precisely the MMC. Unfortunately, now war this stability was shattered… now to Calculate what proportion of foreign exchange earnings gives a GMK, it is impossible, because part of the plants is, part is not working at full capacity. But before this part ranged from 34 to 42-44 percent of all foreign exchange earnings to the country.

— Despite the complexity of the situation, in the last days it became known that such a giant of metallurgy, as the Dnieper metallurgical plant in Kamenka, plans to restore the work terminated March 30. And guarantor of the solution of associated problems come to be you. Tell us more about it.

— Unfortunately, the major shareholders of the company during these months has done nothing to restore operation of the plant. Even, figuratively speaking, gave to the people working there, a ray of hope for improvement. But the plant — forming enterprise not getting the necessary payments from it, local authorities have already started to make plans for the sequestration of the city budget, cuts in the social sphere.

And a little over a week ago I was approached by the Union representatives of the plant to help re-establish his work. “You are our last hope, they said, — you are a professional with an excellent reputation for themselves worked with Martin and know what it’s like to lose a workplace. All of our initiatives came to nothing lead, because we ask for help”. I replied that I understand their pain, I will try to help. After all, this plant in its history it was only during the Second world war. Also, I know this enterprise, for in his time in the group of ISD we purchased it. Then it worked, but was, so to speak, very sick.

The equipment was extremely worn, the plant not generate profit, and losses. However, we purchased it at the highest in Ukraine, at that time a price of about $ 200 million. Money gave Western banks who trusted me and believed in our company, in that it is dynamically developing. We modernized the plant, built a new blast furnace, new rolling mill, a number of other industries. And in the end the company increased its output by almost 40% while increasing the range!

Taruta: “I was approached by representatives of the MQM asking for help to run the plant, I agreed.” Photo: press office of Sergei Taruta

But back to the appeal to me for help factory workers. The day after their visit I went to Kamenskoe in order to deal with the existing problems. We had a big meeting with representatives of staff, unions and local authorities, have discussed what needs to be done to run the plant. Was outlined the tasks that I had to take on. Chief among them: to ensure the production of necessary raw materials and resources to negotiate with creditors to defer payments. After all, when the company stopped all rushed to save their money. And today there are about 40 proceedings to collect debt, accounts of, many other negative. In short, I agreed and undertook the solution of these accumulated problems.

The situation at the plant, of course, today is very heavy. But, on the other hand, all creditors, both financial and commodity, you know that if you block the run of the mill, then they never will pay, because there will be nothing. Is that all cut into scrap metal and sell… However, agreeing to act as guarantor in negotiations with creditors, I demanded that the plant management, in turn, can guarantee all the necessary calculations. After all, to run the plant requires between 100 to 150 million dollars for the next 2-3 months. Living, no money, and no they will not. And production during this time by itself does not appear, you first need to obtain gas, electricity, raw materials and much more. That means we need to borrow.

I managed to secure the agreement of providers, but they demanded that the plant was effective management. So, when will the products and the plant will have money, they would have gone directly into the pockets of shareholders, and was first used to make payments to creditors and suppliers of goods and services. In the end, I agreed to plant Manager put Alexander Podkorytov, with extensive experience and excellent reputation in the sphere of management of metallurgical enterprises. I trust him, because I know for a long time and personally, so I trust lenders, suppliers, shareholders and staff.

Thus, after a series of negotiations I was able to reassure lenders, they give the plant a certain delay, and on the enterprise in the next few days will go some of the resources, for example, coke. I have also agreed on electricity and gas, some other types of supplies.

The Director Podkorytov has a clear picture of how to proceed to in the course of the month to run the plant in the future to make sure that he is no longer standing.

The Director has already signed the two necessary orders. One on the reopening of the plant, the other the launch of the company. It was very important to do just on the eve of Metallurgist Day, because for the South and East of the country is one of the most important holidays of the year. To compare is except that miner’s Day. These holidays are celebrated, without exaggeration, whole cities. And I wish the staff of DMK celebrated the Day of the Metallurgist in the family, with friends, confident in the future, that their jobs will continue, that life will get better. Because I am literally not sleeping, solving their numerous problems, engaging in the negotiation process, of course, not forgetting about his parliamentary activities.

Run DMC has a huge importance for the state of Ukraine. Because it can give products of approximately $ 1 billion. You see, when 92 billion of Ukrainian GDP is only one plant gives a billion is a lot. And if we talk about foreign exchange earnings, the work of DMK is 3-4% of the total amount of foreign exchange into the country.

With the Director. Sergei Taruta and use them at the factory. Photo: press office of Sergei Taruta

— Retained personnel potential of the DMK after several months of inactivity?

— Of course, it was very difficult, some are gone, but the backbone of the team, fortunately, preserved. There are objective reasons, because now not many mining companies, because to find a job in the specialty is not very easy. But most simply remained faithful to plant, and we have done without great sacrifice. And there is much work ahead, enough for everyone, because it’s not just about running existing blast furnaces, and even the construction of a new furnace.

In addition, during the downtime of the plant and its employees, by agreement with the unions received (and receive) two-thirds of their salary even without working. And some worked doing repairs and maintenance of equipment in working condition. It was about half of a normal workload, but still real work.
Now things are changing for the better. We do not forget about social sphere. The mill has a children’s camp, where the summer vacation the children of the many families of factory employees not having the opportunity to travel, for example, abroad or to the sea. The camp was idle, but now it is open and there drove children. I also spoke with the leadership of the city monay and asked them not sequester the budget, not to cut spending on social services. When the plant is operating at full capacity, he shall compensate the city for all losses.

— It is known that stopping of metallurgical production can sometimes be fraught with irreversible negative processes. This did not happen with the DMK?

— No, did not happen because the plant shutdown was not in emergency mode. Satisfy all the technological requirements, because the consequences not so tragic. Yes, in any case, the stop for the equipment is bad. Especially for coke production. Coke should work without a break if stopped — practically it is necessary to build a new battery. But in MQM there is no coke production. I assured the management and staff of the plant, almost all of the equipment stayed there as planned and can be seen as quite working. In addition to the 9-th of blast furnace, there are warning signs, but we know how to handle it. Because in life there are different force majeure, and our metallurgists are able to find a way out. But of course, this is due to high financial costs.

  • See also: Dnieper metallurgical plant began re-entry

— What is the updated products of DMK will hit the market?

Is a traditional products for the steel plant: rebar, wire rod, square, tube stock and some other types. Products are not cheap, for certain types of plant will be given in advance so necessary in the current environment. Because the limit of trust of providers — no more than 2-3 months. If after this time the plant will not be calculated, the other side will stop supply.

— What is the ratio of the demand for such products domestically and abroad?

Unfortunately, 95% of production goes abroad, and only 5% for domestic needs. Alas, while inside the country there is a large demand… And in economically developed countries, the domestic market absorbs 75-80% of metal products. We hope that Ukraine will soon overcome the crisis and will go the way of economic development, then at least half of metallurgical production will be sold domestically. Moreover, domestic market is always in all countries more expensive than export, it is much more interesting to entrepreneurs.

Sport. MP and today is in excellent physical shape. Photo: press office of Sergei Taruta

— Sergey Alekseevich, in the end, the traditional newspaper interview question: if you, with all the download, have free time, what it devote? Sports, reading books?

— I love nature, including man-made. At the time I created in the Crimea Park, he even was called Paradise (Paradise. — Ed.). There I chose the trees, many were planted, he was engaged in landscape design. Was a Japanese Park, Italian, Greek…
Generally, I like to work the land, growing something and obihazhivat their hands. Well versed in all plants, including vegetables. I was born and raised in the suburbs of Mariupol, we planted radishes, cucumbers, tomatoes… With 7 years and probably up to 45 years I actively worked in the garden! No study, no job, no sport that does not interfere. Our small village, which was called Lyapino, fed vegetables a significant part of the Donetsk and neighboring areas. Later, of course, time in the garden I have no choice. But today I am working in the garden, which is situated right here, in the courtyard of Metropolitan office. Sometimes pruned plants, but more to show others how to do it right, where and what to plant, how to form trees and more.

If we talk about sports, then at the time I was actively involved in cycle race, football, mountaineering. Today in the morning, doing yoga exercises, and also still love Cycling.

Now I read mostly economic literature, for example, Eric Reinert. In particular, with respect to his recent book “How rich countries got rich … and why poor countries stay poor”. Well, you write. I want to finish two, in my opinion, an important book. One of the events of 2014, the second about the economic situation in the country and what needs to be done.