Mr. Oleh Shamshur, Ambassador Extraordinary and Plenipotentiary of Ukraine to France on the embassy’s role in attraction of foreign capital into Ukrainian market, its strategy and main governmental initiatives.
The attraction of foreign investments into the economy of Ukraine, facilitation of the work of French companies in Ukraine and Ukrainian companies in France are among main tasks of the Embassy of Ukraine in France. With this regard, the Embassy operates in accordance with the state programs and strategies for attracting foreign capital into the Ukrainian economy, and actively contributes to the establishment of business contacts between the French and Ukrainian companies.
In order to exploit Ukraine’s investment potential and increase foreign investments into the national economy, the Government of Ukraine has been taking measures to improve investment climate in Ukraine, in particular deregulation of business, tax reduction, moratorium on inspections and controls, reinforcement of investors’ rights protection and facilitation of effective interaction of investors with public authorities.
In December 2014, the National Investment Council was established by the President of Ukraine, which includes representatives of the biggest foreign and local investors and public authorities. A high-level representative from the French company ENGIE, one of the largest suppliers of natural gas to Ukraine, agreed to take part in the next meeting of the Council in May, 2018.
From our part, the Embassy regularly informs French companies and our other partners about latest reforms in this field. And we see a keen interest of the French business to work in Ukraine. As an example, the already mentioned company ENGIE apart from importing gas in Ukraine, also actively develops its own customer network of end users, as well as currently it explores a possibility of expanding its work in the alternative energy market of Ukraine, in particular in solar energy and biogas sectors.
We should mention the one of the world biggest constructing company Bouygues, which carried out construction works of the new safe confinement over the 4th power unit of the Chernobyl Nuclear Power Plant. Another good example would be the company NEXANS, that has three production sites of cable products for world-known automotive brands.
Apart from these companies, there are also other companies in retail distribution (Auchan, Leroy Merlin), in agriculture (Lactalis, Louis Dreyfus, Limagrain, Maïsadour), in finances (BNP Paribas, Credit Agricole, AXA), in waste recycling (Veolia, SUEZ) – that have been working successfully in Ukraine for years.
On what hinders investments in Ukraine
The legal framework for investment and business development in Ukraine is currently in a transformation phase for make it coherent to the EU regulations with regards to the Association Agreement between Ukraine and the EU. It is normal that during such a period of transformation there might be certain inconsistencies and difficulties, which are viewed by a foreign investor as an increased risk.
Also, there is a considerable impact of fear from the investors caused by the ongoing Russian aggression against Ukraine and the illegal annexation of the Crimea. Due to these actions of Russia Ukraine has lost an important number of productive capacities and raw material base (-10% of GDP). However, we always emphasize that in spite of this, there are profound reforms in Ukraine that will improve the conditions for doing business.
On interest of the French companies in Ukrainian market
As was mentioned before, the French companies are quite interested in working with Ukraine. A good example of such interest would be a strong participation of the French business in the Ukrainian-French Business Forum held in Paris in October 2016: the event was attended by more than 300 representatives of small and medium-sized French business, experts, media, etc. Another event that gathered numerous French companies was “Atelier Ukraine” organized by Business France in December last year.
There are five sectors, which have strong interest from the French business: energy sector, transport, retail distribution, agriculture and finance.
On how Ukraine is perceived today in France
I would say that nowadays France re-discovers Ukraine. France is ranked 8th in the ranking of foreign investors in Ukraine. The Embassy pursues its work in positioning Ukraine in France as a reliable business partner, as an attractive economy for its investments. Thanks to our work on implementation of the Association Agreement between Ukraine and the European Union, as well as the positive examples of France’s business presences in Ukraine we have mentioned above, today in France Ukraine is perceived as a truly European country with great potential for development and cooperation in many sectors.
At the same time, it should be noted that the conservative French business does examine very carefully the Ukrainian market; however, there is a clear tendency of Ukraine’s image improvement as a promising partner.
On how the visa waiver agreement with Europe affects the investment attractiveness of Ukraine
The adoption of the visa free regime for Ukrainian citizens for travels to the EU and France, to our mind, will have a positive effect. Ukrainian small and medium-sized businesses will have a direct contact with their French counterparts, and could participate in fairs and exhibitions in France. In general, we expect to see a significant increase in the volume of business cooperation between Ukraine and France soon. For our part, we are ready to contribute in every way.
Author – Oleh Shamshur