Explore Business Attractiveness of Ukraine

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Advantages

1. One of the biggest consumer markets in Europe with 46 million people

2. Skilled and cheap labor force.

3. Rich natural resources: the world’s biggest crude iron ore reserves (20% of world total) and 7th-largest proven coal deposits (4% of world total). With 42.9 million ha of agricultural land (or 71% of the country’s total land area), Ukraine accounts for about 25% of the global chernozem area. Besides, Ukraine is known for reserves and production of manganese, sulfur, graphite, nickel, chromite, titanium, mercury, mineral wax, brimstone, complex ores, etc.

4. Favorable geographic location on the crossroads betweenEurope and the CIS (Asia). Proximity to huge markets in Europe and Russia. As a result, Ukraine is part of important transport corridors: railway, roads, oil and gas pipelines. Ukraine is among leader in Europe by a number of infrastructure characteristics: road, railroads, mobile penetration.

5. Diversified export destinations: exports to Western Europe account for 21% of total exports, compared to 46% for Russia and 47-77% for CEE markets. Other major exports destinations include Russia and CIS (32%) and Asia (25%).

6. Fast economic upturn:the economy is expected to grow by 5.0% and 4.5% in 2010-2011, one of the fastest growth rates in the region.

7. Substantial underutilized capacity in many sectorsafter the crisis.

8. Per capita consumption of many goods and servicesis very low. As a result, high growth potential for consumer goods consumption.

9. Moderate and sustainable public debt.Direct debt accounted for 25% of GDP in 1H10 vs. 45% in Turkey and 52% in Poland. Long-term scenario analysis suggests the debt-to-GDP ratio will remain close to 30% even under adverse conditions.

10. Stable and consolidated political environmentenabling the government to push through unpopular reforms, including pension reform, reform of the judicial system, customs, etc.

11. Successful fiscal consolidation: fiscal deficit will narrow to 3.5% of GDP in 2010 from 8.7% in 2009, marking one of the sharpest adjustments in Europe

12. Improving tax environment: the corporate tax rate will be cut gradually by 9pp to 16% in 2014 and VAT rate by 3pp to 17% in 2014, one of the lowest rates in Europe.

Block of stats

• Length of roads– 169, 495.00 km.
• Telephones - main lines in use– 13 026, 000
• Telephones - mobile cellular– 55 333, 000
• Internet users– 7 770, 000
• Railway length– 21, 684.20
• Road length– 169, 496.20

Human resources statistics (source: State Statistics Committee)

• Population: 45.7 m people (31.4 m live in urban area, 14.3 m in rural)
• Economically active population (15-70 years) – 22.1m, able to work (працездатного віку) 20.2 m;  unemployment rate  - 8.1% in the 15-70 category, 8.8% in the able to work category.
• Academia – 20,300, number of pupils – 4.3m. Number of institutes/universities (I-IV level of accreditation) – 854, number of students-2.5m.

Investment Attractiveness Index of Ukraine

The IAI has shown a steady increase after a sharp downturn in 2008, due to the consolidated work of the business community and governmental bodies.

More on www.eba.com.ua.

Quotations of business leaders

Tomas Fiala, Dragon Capital

“The Ukrainian economy is on course to increase by up to 5% in both 2011 and 2012, remaining a growth leader in the CEE region. For the first time in many years, economic expansion is being aided, not obstructed, by the country's politicians. Those finally seem genuinely interested in repairing Ukraine’s investment image and have done a good job tackling macroeconomic challenges and are proceeding on the structural reform front, even if not without IMF oversight. Overcoming the unappealing legacy of the previous years and changing the prevailing stereotypes is not going to be a quick process. But the sentiment on the ground here - epitomized by the surge in IPOs and M&A activity since the second half of 2010 in sectors such as agriculture, FMCG, metals and mining and others - already points to a different picture. Agriculture is probably what currently embodies Ukraine's greatest investment potential, given the growing global concern over food security. But it is obviously not the only chapter in this brochure which aims to present one of the world's most underinvested markets”.

Anna Derevyanko, EBA

“These changing times bring many possibilities. Companies large and small can find investment opportunities across the country and doing so with EBA membership gives them access to a huge wealth of experience, essential information and a dedicated team of staff who work hard to improve the investment climate in the country. Despite the difficulties and the risks involved in investing in Ukraine, ever since the country opened its doors to international trade a steady stream of brave and determined investors have come to the country to conduct business here. Many have stayed to make this their home and many have been hugely successful.”

This project became possible with support of EBA member company Dragon Capital