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  • 17.02.2023

A year into the war - a status update on the Ukrainian economy

February 24th marked the day of the beginning of the Russian invasion of Ukraine. In hindsight to this day, Reiner Perau, Director of the German-Ukrainian Chamber of Industry and Commerce talked with Robert Kirchner on the state of the Ukrainian economy.

One of the main topics was the macroeconomic situation of the country. From a sectoral perspective, the banking sector was stable. Agriculture benefited from the grain initiative, but mines, which endangered production in the fields, remained a problem. The IT sector, which was already developing positively before the war, is relatively strong under the present circumstances. Industrial production is unevenly distributed geographically in Ukraine, concentrated in particular in the heavily contested east of the country, which means that this sector is struggling with the destruction of its production facilities and transport routes and is developing relatively weakly. This also applies to the metal industry.

Companies face challenges

Overall, the country’s economy is facing major challenges. In order to grow again after the war, the country needs investments, especially from foreign investors. Investment guarantees will be necessary to ensure that there is sufficient of it. Additionally, the country, whose production has been relatively energy-intensive up to now, needs a climate-neutral reconstruction, as well as a sustainable transformation of the industry.