GENERAL TRENDS OF BUSINESS DEVELOPMENT OF ZHYTOMYR REGION IN 2022.
In July 2022, a study on the impact of martial law on business in the regions of Ukraine was published on the Diya.Business platform. According to the study, 33% of regional enterprises at that time observed an increase in activity, 50% of enterprises noted a decline in work and 17% of enterprises indicated that they were partially working.
The index of business activity in Zhytomyr region as of September 2022 was 33.33%, which corresponds to the average for Ukraine (33.9%), and is one of the highest among the regions of Ukraine [1]:
- Volyn region – 44.29%
- Sumy region – 37.5%
- Ivano-Frankivsk region – 36.77%
- Vinnytsia region – 34.02%
- Dnipropetrovsk region – 33.59%
- Zhytomyr region – 33.33%
In January 2023, we conducted a survey among regional SMEs on the problems of business during martial law. 45 enterprises from 13 hromadas of the region took part in the survey (it was proposed to take part in the survey to all hromadas of the region).
The survey was attended by entrepreneurs from various industries. The most represented were industries: trade, metalworking, agriculture and food industry, textile industry.
83.3% of entrepreneurs surveyed said that with the beginning of large-scale military operations, their profits decreased, 14.3% of respondents noted that profits did not change, and only 2.4% reported an increase in profits. At the same time, an increase in profits is observed in the field of repair and maintenance of vehicles. The largest reduction in profits occurred in retail, printing and bakery industries. The main reasons for this trend are power outages, which reduces the volume of production of bakery products, reduces working hours and complicates the process of cash servicing of retail outlets and printing services.
According to the survey, the main problems of entrepreneurship development in the region during the war were:
- reduced demand for products/reduced sales (35.5%)
- interruptions in electricity, heat, water supply (21.2%)
- raw material price increase/raw material shortage (19.7%)
- logistics problems (5.5%)
Also, entrepreneurs reported:
- problems of cash management services for SMEs (4.5%)
- lack of working capital (2.4%)
- lack of funds to pay interest on loans (2.4%)
Among some specific problems, it is also worth noting the outflow of personnel from enterprises, which requires entrepreneurs to recruit new qualified personnel or organize the retraining of existing personnel.
GRANT PROGRAMS AND INITIATIVES TO SUPPORT SMALL AND MEDIUM-SIZED BUSINESSES
State program “eWork”
The results of the state grant program “eWork” in the Zhytomyr region: 95 approved applications for a total amount of UAH 21.8 million, that is, an average of UAH 230 thousand each. In total, applicants must create 229 jobs. Of the accepted applications, 60% from legal entities with business experience and 40% from start-up entrepreneurs [2].
INTERNATIONAL TECHNICAL ASSISTANCE PROJECTS TO SUPPORT THE ECONOMIC POTENTIAL OF COMMUNITIES AND COOPERATION WITH BUSINESS
U-LEAD with Europe Programme
Within the framework of the initiative “Business-friendly community. Tools for promoting business in communities, “implemented by the public organization” Club of Business People Ukraine “with the support of the U-LEAD with Europe Program, investment passports of the Radomyshl, Malyn and Pulyn territorial communities of the Zhytomyr region were developed.
In addition, in 2022, U-LEAD supports the Berdichev, Khoroshev, Brusilov and Ovruch communities in the development of investment passports.
Also, in the Radomyshl community, the project “Invest in the Radomyshl community: an investment passport for an American partner” was implemented with the support of the US Embassy in Ukraine, within the framework of which an investment geoportal of the community (https://radmr-gis-radomyshl.hub.arcgis.com/) was created and a business hub was created in the city of Radomyshl, which provides advice to the community’s business. In 2022, with the advice and support of the business hub, 12 business plans were developed that were submitted to the eWork state program, of which 10 applications received funding totaling UAH 2.2 million.
Program EU4Business: “Competitiveness and internationalization of SMEs’
Within the framework of the project EU4Business: “Competitiveness and internationalization of SMEs’ [3], performed by the German Society for International Cooperation GIZ Zhytomyr territorial community received logistical support in the form of: office laptops, multifunctional devices, radio stations, Wi-Fi routers, universal portable external batteries (batteries), radio stations, GPS – navigators for a total amount of almost 600.00 thousand UAH [4]. Also, within the framework of the project, a coworking for internally displaced persons was created in Zhytomyr [5].
. All these activities are aimed at promoting the economic and investment potential of the community and the Zhytomyr region as a whole, and also contribute to the establishment of new formats of cooperation and business contacts of the community and regional business with international partners.
Read more news here.
For more information on grants and opportunities, please click here.