Ukraine is a ground floor investment opportunity at the frontier of the European Union, offering a highly-skilled and productive workforce, low-cost manufacturing platform and attractive entry valuations.
Top Reasons to Invest in Ukraine
· Ground Floor Opportunity
Ukraine, located at the European Union’s frontier, with a pro-Western, pro-business government focused on implementing reforms and strengthening national security and institutions, is well-positioned to become a future economic turnaround success story. The challenges faced by Ukraine create momentum and urgency for pursuing structural reforms - key to the country’s transformation and to unlocking future growth.
· Highly Skilled Human Capital
Ukraine is a large country with a total population of over 45 million. Ranked the 4th most educated nation in the world, over 99.7% of Ukrainians are literate and over 70% have a secondary or higher education. The largest Ukrainian cities, including Kyiv, Kharkiv, Odessa, Dnipropetrovsk and Lviv, are educational hubs as talented young people strive for higher education and job opportunities.
· Low-Cost Production Platform on the EU Border
The DCFTA signed with the European Union and ratified by both Parliaments is already having an enormous impact on Ukrainian industry, lifting tariff and non-tariff barriers for Ukrainian exports, most notably in the agricultural and manufacturing industries, where Ukraine enjoys important competitive and cost advantages. Implementation of the first step, the one-way free trade zone with the EU, encouraged Ukrainian businesses to expand exports to the region. Share of exports to the EU increased from 26% in 2012 to 35% in 2015 to date, with agricultural products and metals driving this growth. Automotive components are now the #1 export category to Germany. Future growth potential is great as per capita Ukraine exports remain low at $1,540 per year versus $4,956 in Poland and $6,605 for the sixteen CEE countries.
· Proximity to Key Markets
Ukraine’s geographic location, combined with its low production costs, creates the opportunity to become a major service, manufacturing and trading hub at the intersection of Europe and Asia.
Ukraine has a robust infrastructure for sustaining an export-oriented economy – close to 170,000 km of roadways, some 22,000 km of railways, 13 sea ports along mainland Ukraine and over 20 passenger airports.
· Attractive Entry Valuations
Ukraine is experiencing increased demand for capital to renew and expand its industry. Ukrainian banks are primarily focused on improving their balance sheets, resulting in interest rates for local currency debt exceeding 20%. Demand is high for equity capital for operationally strong companies in attractive market segments with healthy balance sheets who seek working capital to finance growth, develop exports or modernize production.
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