Ukraine and Germany continue to work on attracting German companies to help rebuild the Ukrainian economy and increase funding for government programmes to stimulate entrepreneurship and concessionary loans. These issues were discussed during a meeting between Yuliia Svyrydenko, First Deputy Prime Minister and Minister of Economy of Ukraine, and Martin Jäger, Ambassador Extraordinary and Plenipotentiary of the Federal Republic of Germany to Ukraine.
“Despite the fact that the second year of the war is now coming to an end, the Ukrainian economy has entered the stage of recovery growth. According to preliminary estimates of the Ministry of Economy, GDP growth for the first 11 months of 2023 is about 5.5%. And in this period, more than ever, we need to attract private capital to the economic recovery. Currently, the most promising areas for investment are military production, construction, agriculture and manufacturing. These are the sectors that are recovering the fastest.
However, major challenges remain. Foremost among these are the blockade of seaports and the focus of missile strikes on disrupting export transport logistics. To address these challenges, we have worked with our American partners to develop an 11-step plan that includes confiscating frozen russian assets, expanding export opportunities and restoring energy stability, returning Ukrainian refugees, increasing budget revenues, developing the defence industry and attracting foreign direct investment,” said Yuliia Svyrydenko.
According to the First Deputy Prime Minister, the Government has earmarked over UAH 40 billion in the 2024 State Budget to finance business support programmes. These are programmes to support small and medium-sized businesses through affordable loans and grants for business start-ups and development. Funding is also provided for grant programmes for manufacturing companies. Ukraine aims to increase the share of manufacturing in GDP from the current 10% to 20-25%.
“We suggest that Germany consider increasing funding for government business support programmes in Ukraine, including the 5-7-9 programme, to create a favourable environment for war-affected businesses. It is also important for us to expand support for medium and large enterprises, including projects with significant investments, industrial parks, and war and political risk insurance. To this end, the Ministry of Economy, together with its partners, is developing a strategy to support small and medium-sized enterprises until 2027. The development and adoption of the strategy is expected to improve coordination between the Government, the business community and donors, as well as between the various business support programmes, which will have a positive impact on the development of the sector as a whole. German financial institutions and development agencies such as KfW, DEG and GIZ may be interested in implementing relevant projects.
We also invite Germany to participate in the supply of equipment to replace damaged and destroyed assets of Ukrainian enterprises. This can help Ukraine become a part of the global production chains of German companies,” said Yuliia Svyrydenko.
The participants of the meeting also discussed the preferential mortgage lending programme eOselia, including loans on favourable terms for Ukrainians who have lost their homes. In addition, the Government is currently developing a number of new instruments to provide Ukrainians with affordable housing, which will be based on affordable rental programmes with the right of redemption and through social rent.