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12 May 2023

Consultation on "Reconstruction of Ukraine" - the market for machinery and equipment

Machinery and equipment is another sector covered by industry consultations as part of the series "Reconstruction of Ukraine", organized by the PAIH Foreign Trade Office in Kyiv. The meeting in PAIH’s Warsaw office with representatives of Polish companies and in a virtual form with the Ukrainian side was started by Aleksander Siemaszko, Deputy Director of the Department of Cooperation and Trade at the Ministry of Development and Technology.

Consultation on Reconstruction of Ukraine - the market for machinery and equipment

When we talk about the reconstruction of Ukraine, we are talking not only about the restoration of key infrastructure. We are also talking about restoring the potential of the Ukrainian economy. For this purpose, supplies of technology and machinery from Poland will be necessary. I know that Polish companies are competitive, partially thanks to their cooperation with PAIH - said Aleksander Siemaszko. He also added that the Ministry is working on legislative support for the activities of Polish companies in the reconstruction process.

The key role of industry consultations was emphasized by Łukasz Grabowski, director of PAIH’s department for export. He reminded that the Agency has been involved in coordinating aid activities since the beginning of the invasion of our neighbor's country.

The machinery sector is very important for the reconstruction of Ukraine. We know that not only Poland is trying to participate in this process, which is why it is so important that our offer is competitive. We encourage you to cooperate with PAIH in this area - he said to the participants.

The hybrid formula of the meeting allowed many representatives of Ukrainian companies, organizations and industry associations to participate remotely. Connecting with participants from Ukraine was possible thanks to cooperation with the Embassy of the Republic of Poland in Kiev. Panel participants had the opportunity to present the current state of the machinery industry in Ukraine, current needs and reconstruction plans. Vladimir Sachenko, President of the UkrMashBud Association, emphasized that despite the war, the industry is trying to function continuously and constantly cooperates with contractors from Poland.

Companies in our association have a wide, comprehensive offer of products and services in the form of implementation of technological lines for many different plants. We also use the products of Polish companies in our business. We encourage broad cooperation with our companies - he said.

The current needs were summed up by Volodymyr Udovychenko, President of the Club of Mayors of Ukraine. He informed that the planned reconstruction will also include the modernization of the sector, especially in the field of public services provided by local authorities.

In the municipal sector, modernization is needed in every area. Heavy equipment is necessary for road reconstruction. We are conducive to increasing the financial capacity of territorial units and solving problems at a government level, this cooperation has already begun. We are also creating organizational mechanisms for cooperation of entities such as PAIH with local governments in Ukraine. We will maximally foster cooperation aimed at raising the technological level in local governments in Ukraine - Udovychenko said.

The problem of removing damage to infrastructure was also referred to by Oleg Garnyk, an expert on municipal services and infrastructure of the Union of Cities of Ukraine. He spoke about the need for efficient reconstruction of destroyed municipal property, including primarily installations supplying residents with water and energy. He stressed that the management of debris generated in the attacks is currently a big problem. Currently, the rubble is transported and stored, but there is no possibility of its further useage, e.g. for road construction. He added that the Ukrainian side is waiting for proposals from Polish companies in this matter.

Oksana Myronko from the European Business Association of Ukraine reported that the automotive industry has shown resilience and is still operating. Companies are growing more slowly than before the outbreak of war, but they continue to do so. According to the Association, 99% of companies continue to opperate in Ukraine, and only 1% have closed their activities.

She added that the number of investments in Ukraine has decreased, but the decline is smaller than predicted at the beginning of the war. As one of the restrictions for foreign companies entering the Ukrainian market in the metallurgical sector, she identified logistics. At present, in her opinion, this is also an issue of investment insurance, and Poland’s initiative in this area is an example for other countries.

The panel was also attended by Volodymyr Vlasyuk, Chairman of the Committee on Industrial Policy at the Chamber of Commerce and Industry of Ukraine. In his speech, he emphasized the key role of human capital for the development of the economy and the development of strategic industries.

In this war, it is very important that the economy of Ukraine continues to function. The difference in economic development may be an obstacle to Ukraine's accession to the EU. One of the reasons for such a difference may be the lack of development of the processing industry, for which technological production lines are needed. We must encourage the development of this branch of the economy - he said.

He mentioned that a big challenge is to supplement elements of the power grid that are destroyed in attacks on an ongoing basis. He added that the interest of Ukrainian companies in the renewable energy sector is growing. He also confirmed that production in the car industry has not fallen despite the war, as production plants close to the border with the European Union can continue to work. Concluding his speech, Volodymyr Vlasyuk said that there is a great need for imports of goods in Ukraine, as a result of which its volume is growing. Ukraine's demand is greater than domestic production, so the prospects for importing machinery to Ukraine are stable.

In a further part of the consultations, representatives of the Bank Gospodarstwa Krajowego and KUKE took the floor, presenting the export support and insurance instruments for Polish-Ukrainian trade available to Polish companies. PAIH's activities carried out as part of the preparations of Polish business for the reconstruction of Ukraine were discussed by Tetiana Chuzha from PAIH’s Foreign Trade Office in Kiev. Representatives of Polish business also shared their experiences from operating in Ukraine.

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