Ukraine is refocusing on production – the Industrial Evolution forum

Manufacturing is once again becoming a central theme of Ukrainian economic policy. Businesses are no longer merely rebuilding what has been lost, but are also investing in new capacity, deeper processing, technology and exports. This was the conclusion reached at the forum ‘Industrial Evolution: Manufacturing Drives the Economy’.

The key theme of the event was how Ukrainian manufacturing can transition from merely surviving during the war to becoming competitive. Participants discussed financing, industrial parks, labour shortages, exports, energy resilience, automation, R&D and the state’s role in industrial development.

Oleksiy Sobolev, Ukraine’s Minister of Economy, Environment and Agriculture, emphasised that the war had changed the state’s approach to manufacturing.

“We have realised that if we do not produce something, we do not have it. Industrial policy is part of national security policy. Industry is not just about the economy; it is what protects us now and will protect us in the future,” he remarked.

According to the minister, Ukraine’s strategic goal is to increase the manufacturing sector’s share of GDP to 20 per cent. Currently, this figure stands at 8.8%. By 2025, the manufacturing sector had become the largest taxpayer among the economy’s sectors – accounting for 18% of consolidated budget revenue, or 70 billion hryvnias more than before.

Industrial parks have become a particular focus – there are already around 40 active sites in the country. Infrastructure is being developed there, factories are being built, or enterprises are already in operation. Around 1.2 million square metres of industrial property has been created in these parks, substations with a capacity of around 300 MW have been built, and the volume of investment has risen to almost 45 billion hryvnias.

Vasyl Khmelnytskyi, founder of the UNIT.City innovation park and the Bila Tserkva industrial park, and initiator of the forum, described manufacturing as a key driver of economic growth.

“We create jobs, pay taxes to the state and local budgets, and boost people’s purchasing power. If Ukrainian business is successful, foreign investors will certainly come to us,” he said.

According to Khmelnytskyi, when choosing a location for production, foreign companies look beyond just taxes or geography. They assess whether local businesses can operate successfully in the country. If Ukrainian manufacturers are building, developing and making a profit, this sends a signal to international investors.

At the same time, participants at the event highlighted several constraints that are holding back growth:

• Access to finance. Industrial projects require longer-term and cheaper funding, insurance against war risks, and clear guarantees for investors.
• Workforce. Manufacturers are short of engineers, process engineers, operators of modern equipment, and skilled tradespeople. Businesses are looking for more practical collaboration with the education sector, the development of dual training, corporate schools and retraining programmes.
• Productivity. Ukrainian companies will not be able to compete on the basis of lower labour costs alone; they need automation, R&D, products with higher added value and access to foreign markets.
• The role of the state. The business sector expects not one-off programmes, but a consistent industrial policy: support for exports, localisation in procurement, the development of industrial parks, clear regulations and tools for scaling up.

Forum participants believe that the future of the Ukrainian economy will depend not only on the level of international aid or investment, but also on the country’s ability to produce more on its own.

The Industrial Evolution forum took place on 18 June at the Bila Tserkva Industrial Park. The event brought together over 1,800 participants – owners and managers of manufacturing companies, investors, and representatives from government, the financial sector, education and the expert community.

It is worth noting that, according to the State Statistics Service, the volume of capital investment for January–March this year rose by 5.1 per cent year-on-year to 130.1 billion hryvnias. Over 41 per cent, or 53.6 billion hryvnias, of the total value of capital investment was accounted for by the industrial sector.