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90% of Ukrainian companies resumed work since beginning of Russian invasion

Tuesday, 20 February 2024, 19:18
90% of Ukrainian companies resumed work since beginning of Russian invasion
Stock photo: Getty Images

Since the start of the Russian full-scale invasion of Ukraine, 64% of micro-, small, and medium-sized enterprises (MSMEs) have temporarily suspended or closed their operations, but the vast majority of them have already resumed.

Source: the study by the United Nations Development Program (UNDP)

Details: As of October 2023, only 9.6% of entrepreneurs who have suspended their activities face the risk of losing their businesses.


This represents a significant improvement over the 46.8% of companies that were at risk of closure or suspension in June 2022.

According to the study, the IHR is the foundation of the Ukrainian economy, accounting for 99.98% of all business entities, 74% of all jobs, and 64% of total added value.

Quote: "Despite the ongoing war, businesses have successfully adapted to the situation and maintained financial stability. A majority of companies reported financial losses of up to US$100,000 attributed to the war.

The scale of financial losses varied across sectors, with the construction sector suffering the most and agriculture, telecommunication, marketing, consulting and design services experiencing the least impact," the report says.

Thus, 84% of the companies that suspended operations in early 2022 were able to partially resume operations within six months.

At the same time, the UNDP notes that there are significant regional differences: enterprises in Ukraine's east and south suffered 1.5 times more losses than those in the country's west.

According to the study, roughly a quarter of companies received government or international aid, which was critical to the survival of half of those businesses.

"The feedback from businesses highlights the continuing need for and importance of expanding these support programs," the UNDP added.

Compared to the pre-war level of 72.4%, International Health Regulations (IHR) capacity utilisation has dropped sharply to 45.7% in 2023, with an expected increase to 56%. If the demand rises, businesses are prepared to increase their turnover by roughly 50%.

At the same time, only 9.5% of businesses reported no financial losses as a result of the war, with roughly 10% reporting minor losses of up to US$10,000. According to the report, the average financial loss from the war is US$227,000 per company.

"While financial outlook has worsened, with over 77% of businesses viewing their situation as bad or satisfactory, companies still exhibit optimism about post-war recovery and forecast to maintain full-time employment and integrate IDPs into their workforce.

Having already downsized, most businesses do not intend to reduce staff further, seeing their workforce as a prerequisite for a gradual recovery of the economy in 2024," the UNDP summarises.

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