While Ukraine used to be a major player in the former Soviet Union’s economy, the country faces many political and economic challenges today. However, many expats still see the Eastern European country as a perfect business destination that offers an abundance of opportunities.
The Economy
In 1991, when Ukraine finally gained independence, the government took action and tried to implement reforms in order to privatize the country’s economy. Unfortunately, resistance from within the government itself hindered the changes and stalled any economic growth. By 1999, the output had fallen to less than 40% of the level of 1991. Finally, Ukraine managed to eliminate most tax and custom privileges to foster growth and economic activity.
While the country made it through political turmoil and even experienced a slight upswing in 2006 and 2007, Ukraine was hit hard by the economic crisis in 2008. Since 2010, the economy has been recovering which is partly due to the rise in exports.
Important Economic Sectors
Although the economic history of the Ukraine might look rather gloomy, there are still a lot of opportunities for those who plan on working or starting a new business there. Before 1991, the country was responsible for a large percentage of agricultural production in the Soviet Union and provided milk, meat, and vegetables for other countries. Today, the sector still contributes about 31% to Ukraine’s GDP.
However, the main contributors to the country’s economy are metal and mining industries. Iron, coal, and steel productions in particular are important sources of national income. This is due to the fact that Ukraine has a lot of natural resources, especially in the form of mineral deposits. There are an abundance of companies in these fields which offer work opportunities to expats who dream of living in a foreign country.
Ukraine’s Business World
New multinational companies have opened in the country in recent years and are in constant need of foreign business people to help market different technologies and services. In addition, Ukraine has significantly improved its business atmosphere according to the World Bank’s Doing Business Report 2014. In the last year, the country improved the conditions for entrepreneurs and companies and climbed from rank 189 to 112.
Although it still falls behind Russia, Kazakhstan, and Belarus, Ukraine has advanced in many fields. For instance, it is now easier to apply for a planning and building permission, tax and social insurance procedures have been simplified, and new customs regulations improved conditions for import and export businesses. It shows that there is an upward trend in Ukraine’s business world which makes it a future top destination for expats and foreign entrepreneurs.
Business Etiquette in Ukraine
As you will not only meet expats in Ukraine but will also deal with local business people a lot, you should know about the country’s business etiquette. If you know how to behave during a business meeting, for instance, you will have an advantage over competitors and your Ukrainian business partners will warm up to you much more quickly. It is important to invest some time in building up your business relationship and engage in small talk frequently. Your business partners will like to get to know you before doing business with you.
Ukrainians value professional titles. When you address your business partners always use their titles or, if they do not have an academic or professional title, the prefix “Pan” (for men) or “Pani” (for women). Your own title should be included on your business card as well, so that your business partners know how to address you. While they will expect you to dress formally and be well-prepared during meetings, you’ll also be invited to business dinners and drinks. If your hosts pour you a glass of vodka, don’t hesitate to partake in toasts. Refusing a drink might be considered rather rude.
By Elena Born
Connecting global minds
InterNations.org
