Coveris talks about ‘turbulent economy’ as it decides to invest in Ukraine

By Jenny Eagle

- Last updated on GMT

Coveris DuoSmart cup, Ukraine political crisis

Related tags Russia

Coveris Rigid Poland has launched its DuoSmart cups in Ukraine to target the dairy and processed foods sector, but admits it was a courageous decision to invest there given the turbulent economy.

The bilateral partnership of Coveris Ukraine and Poland and its business partners in the Ukraine is an important step in terms of business development in Eastern Europe for the company and it plans to launch further products there in the coming months.

Danone and Nestlé

Speaking exclusively to FoodProductionDaily, Volodymyr Stipakhno, GM deputy, Coveris Rigid Ukraine, said Coveris has been operating in the Ukraine market since 1998 and is partners with diary firms including Danone, Lactalis, Wimm Bill Dann (PepsiCo) and Nestlé.

The majority of its products are produced locally, but some parts of the packaging are imported from Coveris Rigid Polska.

The political climate in Ukraine is very complicated right now as the crisis is visible in many business areas. The main problem which we see is the lack of energy sources. Also, the unstable situation with foreign currency brings tension to the society​,” he said.

The crisis in Ukraine began in November last year when pro-Moscow President Viktor Yanukovych abandoned a deal with the EU in favour of stronger ties with Russia.

Since then, Ukraine has seen protracted and bloody violence, the annexation of Crimea by Russia, and the shooting of Malaysian airline passenger plane MH17 by a surface-to-air-missile.

Ukraine's parliament voted in a new government this week, it endorsed Pavlo Klimkin as foreign minister and Stepan Poltorak as defense chief in the cabinet of Arseny Yatseniuk as shelling persisted in eastern Ukraine despite a fresh truce deal between government troops and pro-Russian separatists.

Economic reform

Ukraine has been offered billions of dollars in aid by international lenders if it carries out economic reform and President Petro Poroshenko said the administration would benefit from international specialist input.

The situation will depend on whether the issue with the “independent republics” inside Ukraine will be solved. Also, the Ukraine should start to look for a compromise with the Russian Federation," ​added Stipakhno.

Until a solution is found, the situation will get worse. Although the market is turbulent, there is a space for development and growth of products. Coveris has decided to continue developing its site in Kiev​.

Coveris Rigid Ukraine has a big potential as the region has a population of more than 40m people and the market is huge. The country is in close proximity to the EU and Russian Federation, and has a less expensive labor force than in Europe​.” 

Suitable for dairy & instant food

The DuoSmart thermoformed cup is suitable for dairy and instant food products and comes in a range of sizes, including 330ml. It also has a “Light” version, containing a paper wrapper without a paper bottom base, which reduces package weight.

Stipakhno added DuoSmart combines the attractive appearance of paper cups with the functionality of polymers. Compared to regular plastic packaging, the inner cup’s weight is reduced by 50%, and the recycled paper wrapper is made of renewable resources.

It comes in a range of applications for the inner plastic cup including PS – polystyrene, PP – polypropylene, PET – polyethylenterephthalat, PLA – polylactic acid and PP/EVOH – polypropylene/barrier sheet, suitable for chilled and ambient storage as well as hot filling and microwaveable products.

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