Revitalizing Ukraine’s SME Sector: A Journey of Resilience and Growth

Revitalizing Ukraine‘s SME Sector: A Journey of Resilience and Growth

How Ukrainian Small and Micro-Enterprises Are Bouncing Back and Fueling Economic Growth

Tetyana Berezhna

The International Organization for Migration (IOM) Ukraine, in partnership with the Ministry of Economy of Ukraine, recently unveiled the noteworthy outcomes of the SME Boost project.

This laudable initiative was geared towards bolstering micro and small businesses across the country. Remarkably, more than 700 of these enterprises, spanning 10 regions of Ukraine, benefitted from this project through a combination of grants, expert consultations, and educational events.

The SME Boost project played a significant role in the resilience and growth of these businesses, especially during trying times.

Notably, 212 of the grant beneficiaries were businesses that had been relocated or affected by conflict. The project’s total budget sits at €10,000,000, supporting the recovery, adaptation, and expansion of these enterprises.

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Women entrepreneurs made up approximately half of the businesses that received support from IOM, highlighting the project’s commitment to promoting gender equality in entrepreneurship. The project’s impact is further underscored by the fact that it helped preserve nearly 5,000 jobs while creating over 2,000 new ones.

The Federal Ministry for Economic Cooperation and Development, also known as BMZ, played a major financial role in the project. This was achieved through the vehicle of the German Development Bank, KfW, which was responsible for the allocation and management of the funds provided by BMZ.

However, the financial backing of the project was not the only component that contributed to its realization. The project was run in a cooperative manner, involving multiple parties to ensure its success. Among these contributors were the Ministry of Foreign Affairs of Ukraine and the Ministry of Reintegration of the Temporarily Occupied Territories of Ukraine.

The Ministry of Foreign Affairs of Ukraine, a governmental body tasked with overseeing Ukraine’s international relations, played a crucial role in ensuring the seamless implementation of the project. Their involvement was vital in aligning the project with Ukraine’s foreign policy objectives, as well as facilitating communication and cooperation with the German entities involved.

On the other hand, the Ministry of Reintegration of the Temporarily Occupied Territories of Ukraine also played a significant role in the project. Their primary responsibility is to manage and coordinate efforts to reintegrate areas of Ukraine that are currently under de facto foreign control. Their involvement in the project was key in ensuring that the project’s objectives and activities aligned with the broader goal of reintegrating these areas back into Ukraine.

Overall, the project was a joint effort involving multiple entities, each contributing their unique expertise and resources towards its successful implementation. The funding provided by the BMZ via the KfW Bank, combined with the collaborative efforts of the Ukrainian Ministries, ensured the project’s success.

Together, these institutions worked collaboratively to implement the project funded by BMZ through the KfW. This collaborative effort indicates a strong partnership between these entities and a shared commitment to achieving the project’s objectives. Without the financial support from BMZ and KfW and the collaborative work of Ukraine’s Ministry of Foreign Affairs and Ministry of Reintegration of the Temporarily Occupied Territories, the project would not have been possible.

The vibrant city of Slavutych recently hosted Ukraine’s President Volodymyr Zelenskyy and the First Lady Olena Zelenska. They visited Nova Kukhnya, a business revived by Mariia and Serhii Bubnov. The couple had previously run a successful food production enterprise named Azov Factory Kitchen in Mariupol. However, the business faced destruction during the occupation in March 2022.

Undeterred, the Bubnovs moved to Slavutych and started afresh. They rebuilt their business with assistance from the Vlasna Sprava Grant program and another grant from the Ministry of Economy of Ukraine. These grants enabled the purchase of necessary equipment and created new jobs, signifying a significant step towards recovery.

In addition to the grants, the couple attracted investments exceeding $500,000, including significant contributions from USAID Competitive Economy of Ukraine Program and Dai Global. Nova Kukhnya focuses primarily on the production of packaged soups, utilizing a unique, preservative-free packaging technology that allows a one-year shelf life.

The forward-looking business owners plan to expand their product range, create more jobs, and venture into export markets. They attribute their success to the various business support opportunities provided by the state. Ukraine’s SME sector is undoubtedly a key pillar in the country’s economic stability and growth, with every new job created being an investment in its future security and prosperity.

The Made in Ukraine policy, under the leadership of Yulia Svyrydenko, continues to reveal unique businesses that are shaping the country’s economic landscape. The resilience and determination of Ukrainian entrepreneurs like the Bubnovs contribute significantly to strengthening the national economy, creating a sense of pride and optimism for the future.

Tetyana Berezhna: Deputy Minister of Economy of Ukraine

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