20th Ukraine Breakfast Debate: „COVID-19 in Ukraine: Economic Consequences for Foreign Investment and Local Businesses”

How did the Ukrainian government react to the COVID-19 pandemic, partic­u­larly with regard to supporting small and medium enter­prises? Have those measures been effective? And how can the EU assist Ukraine in the short to long-term in order to ensure its recovery and economic stability? Within the framework of the 20thUkraine Breakfast Debate on the topic “COVID-19 in Ukraine: Economic Conse­quences for Foreign Investment and Local Businesses”, which took place on Thursday, November 5, 2020, experts and partic­i­pants jointly tried to answer these questions. Once more conducted as a virtual event, the debate confirmed the relevance of regular exchanges on current issues in the German-Ukrainian context.

The Breakfast Debate was opened by IEP Director Dr Katrin Böttger with a welcome speech on the impor­tance of German-Ukrainian bilateral exchange, especially in times of Covid-19. It was followed by short inputs on the micro-and macro­eco­nomic situation in Ukraine, provided by our guest speakers Oksana Kuziakiv, Jean-Erik de Zagon and Robert Kirchner. Oksana Kuziakiv is the Chief Executive at the Institute for Economic Research and Policy Consulting (IER) and Jean-Erik de Zagon is the Head of Repre­sen­tation at the European Investment Bank (IEB) in Kyiv. Our third and last speaker was Robert Kirchner, Deputy Team Leader at Berlin Economics. Following these three input presen­ta­tions, the partic­i­pants engaged in a lively discussion about Covid-19 counter­mea­sures and their impact on the business climate in Ukraine.
The Ukrainian economy, which has made signif­icant progress since 2015, has been hit severely by the COVID-19 pandemic with a predicted GDP decline of 7% for 2020. The country will be in need of inter­na­tional assis­tance to overcome the current crisis. The experts pointed out that Ukraine had been on a good track before: Ukraine was able to reduce interest rates from 11% in 2018 to less than 6% in 2019 while Foreign Direct Invest­ments (FDIs) have been increasing slowly but steadily since 2015. However, especially when quarantine measures were announced in the spring of 2020, progress made in recent years started to vanish.

Nonetheless, in October 2020 the outlook was not as bad as expected: Some sectors, for example the retail industry returned to strength and posted double-digit growth rates. Other sectors performed less well, as the indus­trial production’s output remained lower than 2019 due to the lack of foreign demand and unfavorable condi­tions for agricul­tural production. However, when being asked about the future of their enter­prises, most entre­pre­neurs remain positive and expect the crisis to end within the next two years.

Reasons that were given to explain the generally optimistic prospect directly referred to national and inter­na­tional financial aid measures and policies: Firstly, the Ukrainian government provided a number of business support programs such as temporal suspension of loan repay­ments (March until May 2020), tax prefer­ences and direct financial support. Secondly, the European Investment Bank (EIB) invested in Ukraine’s infra­structure through programs that aim to modernize the country and reallocate existing loans. In addition to that, the Deep and Compre­hensive Free Trade Area (DCFTA) and the subse­quent increase in trade with the EU and Germany was presented as a success story.

It can be summed up that while the COVID-19 pandemic has had a signif­icant short-term negative impact on the country, the long-term perspective leaves room for optimism. Ukraine is on a good track and economic cooper­ation on multiple levels gives hope for a brighter future after the end of the pandemic.


The Ukraine Breakfast Debates are part of the project “German Ukrainian Researchers Network” (GURN). GURN aims to establish a German-Ukrainian network for senior and junior researchers, strength­ening expertise in the field of policy analysis and promoting joint research projects. GURN is conducted in cooper­ation with the Ilko Kucheriv Democ­ratic Initia­tives Foundation (DIF, Kyiv), the think tank devel­opment and research initiative think twice UA (Kyiv), New Europe Center (NEC, Kyiv), and is kindly supported by the Federal Foreign Office.

This event was organized in cooper­ation with the European Investment Bank (EIB).