In the short term, the path ahead for Ukraine’s logistics business is as bumpy as Ukraine’s roads, in part due to a horrible investment climate that chokes business in bureaucracy, corruption and shakedowns.
Yet it’s a path that logistics businesses will stick to, because of the huge long-term upside. Simply put, Ukraine lags far behind the West in terms of number and quality of logistics infrastructure, be it roads, warehouses, cargo terminals or ease of customs clearance procedures. And where there are hurdles for some, there is opportunity for others.
“Growth dynamics have not recovered to pre-crisis levels,” said Oleg Kalensky, secretary of the logistics and transportation committee at the American Chamber of Commerce in Ukraine. Kalensky estimated, however, that the industry is still growing strongly, by about 15 percent annually. Yet this, he said, is only half of the 30 percent annual increases of 2006-2008.