War & Business: The Ukraine Business Network has been launched.
Tucked away amid the sloping hills of Kyiv, a select group of business investors, representatives, and entrepreneurs gathered at the Parkoviy Congress Center to gain insight into investment prospects in Ukraine. The event launched the Ukraine Business Network; a private community of industry leaders, business owners, and the top management of domestic and international companies doing business in Ukraine. The network is aimed at helping businesses navigate the Ukrainian market more effectively by providing additional tools and insights.
The network’s Co-founders, Andrew Pryma and Mark McNamee, provided their guests exclusive insights into the state of economic affairs in Ukraine and beyond. Before their distinguished speakers from both the private and public sectors were given the word, the Global Macroeconomic Outlook for 2024, Scenarios & Implications of the War, Ukraine’s Macro Outlook, and Market Dynamics were presented.
Perhaps most inspiring was that Ukraine’s economy is reflecting the resilience of the Ukrainian people. Ukraine looks attractive, with a 5.5% growth and real potential for rapid development. Its GDP forecasts are raised for this year and next by the NBU, World Bank, and IMF: 9% YOY growth in September; 5.3% Jan-Sept. Inflation is slowing notably, interest rates have been cut, and hryvnia moved to a flexible peg. Major retailers are expanding operations, with retail sales up 7% YOY in H1. Paradoxically, as investors are becoming more accustomed to geopolitical risk at the global level, Ukraine’s growth rate is more appealing than most markets.
Despite the lack of investment guarantees, manpower shortages caused by the war, logistical issues at the borders, high inflation, and power outages, business remains steady and stable. It is continuously acquiring a new innovative resilience.
The overall global situation, however, looks rather volatile. The war in Ukraine, uprisings in the Global South and the Middle East, and next year’s elections in Russia (March), the EU (June) & the USA (November) will undoubtedly affect Ukraine’s economy and war effort. Elevated commodity prices, namely food and oil, are expected throughout 2024.
Yuri Donets, Head of Schneider Group, Peter Dickinson, Editor of the Atlantic Council’s UkraineAlert, Yuriy Sak, former Advisor to the Minister of Defense, Denis Golubchikov, Head of Jonson &Jonson Ukraine, were among the speakers offering business insights. Ukraine’s Deputy Minister of Digital Transformation, Yegor Dubinsky, offered unique insights into the groundbreaking technologies being developed in Ukraine. He noted whilst “guarding the values of civilization as a whole,” “Ukraine has become a marketing agency for weapons in the world”. The defense industry will account for 40% of its economy.
Corruption in Ukraine was contemplated as an over-weaponized term that may do unnecessary harm to Ukraine. Refreshingly, corruption was also addressed from the other side as certain foreign companies are interested in war profiteering or insider purchasing. They are also experiencing pushback from within Ukraine.
Ukraine Business Magazine Owner and Atlantic Council Fellow Peter Dickinson said, “Despite the long-term effects of stress of war, Ukraine’s business is surprisingly starting to thrive again.” It is a war that is leading to the collapse of the final empire (Russia) since the 20th Century.
Investors and businesses are closely eyeing the Ukrainian market. Clear rules of engagement and increased assurances in the form of (war) insurance that will bring security to them must be established. For those who want to see their business and Ukraine thrive it is important to learn more about the progress, risks, and developments related to doing business in Ukraine. These topics and more will be addressed the next time the Ukrainian Business Network meets on 15 March, 2024.