2023-07-31 15:41:35
It is well known that Volodymyr Zelensky does not bake small rolls. And so, wearing an olive-green shirt and with a pithy slogan, he wooed investors for his war-torn country, whose gross domestic product shrank by 29.5 percent last year. Ukraine offers “the best opportunity in Europe since World War II.” In fact, some executives are already getting their act together, while recovery conferences speculate on how many hundreds of billions of dollars it will all cost and US financial groups like Blackrock make declarations of intent.
Andreas Mihm
Business correspondent for Austria, Central and Eastern Europe and Turkey based in Vienna.
However, you can still count the names of the investors on the fingers of two hands. The Swiss food company Nestle is among them with 40 million euros for the expansion of a plant for instant noodles, as is the Irish insulation specialist Kingspan, who wants to build a new plant for 200 million euros within five years after ending its Russian business in the Ukraine. Bayer AG and the building materials manufacturer Fixit, who have announced investments in the millions, are faster.
Now the tobacco company Philip Morris has also announced the construction of a new cigarette factory near Lemberg (Lviv). The administration building of the former production facility in Kharkiv was destroyed by the Russian attack. To be on the safe side, the tobacco giant had stopped production. Getting back on his feet is important to him. Because almost every third pack of cigarettes sold in the war-torn country comes from illegal production. Even if Philip Morris emphasizes the promotion of the Ukrainian economy in the interview.
Other companies are in the starting blocks
More are on the way. The German building materials manufacturer Knauf, for example. His 200 million investment in the Donbass is only a ruin, but in the Bavarian town of Iphofen they say: “Knauf intends to build a new plant in Ukraine as soon as conditions allow.” Since then, the Ukraine has been supplied from a once decommissioned plant near Kiev, which will be put back into operation in mid-2022. But as soon as conditions allow, a new plant will be built. “Knauf can also imagine playing a role in the reconstruction of social facilities such as kindergartens, schools, hospitals, etc.,” it continues.
The number of new investment projects in Ukraine supported by the federal government is increasing rapidly. In April, calculated from the beginning of the war, there were only three, today there are already ten, as the Federal Ministry of Economics reported in response to an inquiry from the FAZ. At the beginning of the month, it assumed 28 investment guarantees with a maximum liability totaling EUR 349 million. Ten of them had been added since the beginning of the war. Nineteen other applications are still being processed.
According to this, the German economy alone has increased its commitment, which is secured by German state guarantees, by half in the past few months. In April, when Minister Robert Habeck (Greens) visited Kiev, there was talk of 21 guarantees with a volume of 221 million euros.
However, investments such as those by Philip Morris, Bayer or Knauf have not stopped activists from criticizing the companies for their ongoing involvement in Russia. However, the government in Kiev has not put them on a list of sanctions, albeit largely without economic consequences, unlike Unilever, Metro or Austria’s Raiffeisenbank International.
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