A year to the day since Russia launched its devastating invasion of Ukraine, western companies are being urged to be part of the country’s recovery.
“Ukraine is open for business,” Andy Hunder, president of the Kyiv-based American Chamber of Commerce in Ukraine, told MarketWatch. Western companies, he said, should be looking to be part of “the biggest recovery of a nation in Europe since World War II.”
Ukraine’s GDP fell by 30.4% in 2022, according to the country’s Ministry of Economy.
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“Companies are continuing to operate during the war, because it’s important to keep the economy ticking over,” said Hunder. “We have seen quite phenomenal resilience.”
Hunder used the example of McDonald’s, which reopened in Ukraine in September and continues to operate in the country.
“More romantic than McMenu with a loved one — only McMenu by candlelight,” tweeted McDonald’s Ukraine on Oct. 27, 2022, in a wry reference to the power cuts that have followed Russia’s attacks on Ukraine’s energy infrastructure.
In December Hunder tweeted that McDonald’s had reopened in Bucha, which had been a key battleground in Russia’s failed attempt to capture Kyiv.
The Chamber of Commerce President also highlighted Nestlés
recent announcement of a $42.8 million investment in a new production site in Ukraine’s Volyn region. The investment will expand the Swiss food giant’s production of vermicelli and other food products in Ukraine.
Hunder acknowledged the reality of doing business in Ukraine, such as dealing with power cuts and air raids. “When we’re in our office we have to go down to the underground car park and wait until the air raid sirens are off,” he said.
Some 70% of the Chamber’s members are operating fully, according to Hunder, and 88% are paying salaries in full. However, 19% have had instances where at least one employee has been killed in the last 12 months and 31% have factories and property that has been damaged.
A Mondelez International Inc.
factory in Trostyanets that produced Oreos is one of the facilities that suffered significant damage in the war. Trostyanets, near Sumy in northeast Ukraine, was the scene of fierce fighting at the start of the war, before its recapture by Ukrainian forces.
“We’ve invested to restart both our potato chip factory in Vyshhorod and our chocolate factory in Trostyanets, with strong safety measures and enhanced security protocols in place,” a spokesperson for Monedelez told MarketWatch.
“We continue to increase our humanitarian support for Ukraine, with more than $12 million in cash and in-kind donations committed to date,” the spokesperson said. “Our thoughts remain with the people of Ukraine who have been impacted by this senseless violence.”
A business resilience survey of American Chamber of Commerce in Ukraine members conducted by the Chamber and McKinsey & Company found that, while the war has placed a massive toll on Ukrainian business, companies have shown strong resilience, with some even finding growth opportunities. Some 47% of respondents experienced a sales decline, with agriculture, retail, mining and metallurgy the most hit. However, only 2% of companies reduced headcount by more than 30%, and around 15% of companies captured growth in 2022, despite the war. The survey was conducted from mid-January to early February 2023.
Ukrainian businesses are also working hard to combat the country’s power cuts. In a speech in December, Ukraine’s Prime Minister Denys Shmyhal said that 500,000 mostly low-power generators were brought to Ukraine by businesses and individuals in 2022. “In addition, our partners provide us with larger generator units that can power important facilities,” he said. “For example, medical institutions or pumping stations of water utilities.”
Earlier this month the U.S. Agency for International Development delivered a mobile gas-turbine power plant to Ukraine that was purchased from General Electric Co.
The mobile power plant was manufactured in the U.S. by GE’s Gas Power business and has a total output capacity of approximately 28 megawatts, which is enough to provide the equivalent electricity to at least 100,000 homes, according to USAID.