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Otherwise, it is impossible to attract foreign investment to the country

Without a predictable tax and tariff policy, it is impossible to attract foreign investment to Ukraine. Otherwise, major players will not invest in domestic enterprises. This opinion was expressed by Oleksandr Vodoviz, Head of the Office of the CEO of Metinvest Group, at the conference Strategic Resources of Ukraine: Development Scenarios for the Subsoil Use Industry.

According to him, the mining and processing business is quite capital-intensive. A potential investor must immediately invest significant funds in the development of the enterprise. Only large international players have access to such resources, and they value stability and predictability of government policy.

“For example, developing a mine similar to the one in Pokrovsk would require around US$10 billion. Let me remind you that Pokrovsk is the last coking coal mine in Ukraine. Currently, there is much discussion about coking coal mines in western Ukraine. Initial investments in such projects could amount to US$3-4 billion, and this is only to reach the minerals. Will any company be willing to invest such funds when transportation, electricity and tax rates are constantly fluctuating? There must be some measure of stability to attract investment,” explained the head of Metinvest’s CEO’s office.

He also noted that projects in the mining industry have a very long payback period. According to Ernst & Young, it takes an average of 18 years for an investor to go from obtaining a license and obtaining permits to launching an enrichment facility.

The best criterion for the situation in the country’s mining industry, Oleksandr Vodoviz emphasized, is the number of new mines and processing plants opened in Ukraine over the past 20 years. Currently, there are some projects at the feasibility stage, he said, but zero are ready, which is the answer.

According to the head of Metinvest’s CEO’s office, at the moment, Ukrainian business is mostly investing independently in the development and maintenance of enterprises and the mining industry, as it is export-oriented.

“We sell products abroad and invest the proceeds here. We invest an average of US$1 billion annually. How many businesses can allocate such funds just to maintain ongoing operations?” noted Vodoviz.

He added that the share of small and medium-sized businesses in Ukraine’s GDP is only 20%, with the rest coming from industry.

In addition, the head of Metinvest’s CEO’s office reminded that working in a war makes it difficult for businesses. The government should take this factor into account, particularly in the process of integrating European legislation.

Mr. Vodoviz noted that Ukraine will go through three stages of rapprochement with the EU, with the process lasting 4-5 years in total. The first stage alone – legislative monitoring – will involve 550 regulations in the extractive industry.

He noted that the business has repeatedly noted Brussels’ tough stance on the requirements for the adoption of European legislation. In this regard, there is concern about the position of Ukrainian government officials, who report that they cannot resist this.

“But we are at war, and our economic situation is completely different. For example, steel plants in Europe receive grants for environmental modernisation. We do not have that here. We are unable to meet European standards. We are asking the government to pay attention to this issue,” summarized Oleksandr Vodoviz.

As GMK Center reported earlier, in January 2025, Metinvest announced the temporary suspension of Pokrovske Coal Group’s operations due to the aggravation of the security situation on the frontline and electricity shortages. This decision is related to the priority of protecting the lives of employees who were evacuated with their families. The company is replacing Ukrainian coal with supplies from the United States.