Ukrainian exports: Challenge for the next 5 years

Author : Natalia Mykolska

Source : 112 Ukraine

What foreign markets are Ukraine's priority and what are the key points of country's roadmap of strategic trade?
14:11, 12 April 2017

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We have presented the project "Ukraine Export Strategy - Roadmap of Strategic trade in 2017-2021 years."

18 months of common working of a large number of Ukrainian and international experts, associations, government agencies, complex and lengthy discussions... As a result - we have formed a vision and Ukraine's place in the international trade in 2017-2021 years.

Now it depends on us, what would these five years mean for Ukrainian export. But for this the help of business is needed.

Now we have a clear vision of further development, knowledge-intensive and innovation for sustainable export development and success in global markets.

Related: Free trade not for all: Ukraine's exports statistics by regions

Export is a synergic complex interaction of many industries. In practice, it does not work by itself as dependent on different areas, each with a specific algorithms and problems: transport infrastructure regulation (customs, fiscal, monetary, technical) education, human resources, innovation, investment, crediting.

Now each sector develops by its own logic, live their lives.

But sometimes they do not overlap, but exist in parallel dimensions. We develop innovations - but not for business; we have qualified and talented professionals, but they are not ready for today's challenges; we conduct cosmetic repairs of infrastructure and customs instead of total adjustment; extinguish fires excessive resources instead of doing reforms systematically and comprehensively.

We must find a strong intersection and interaction between education and business needs, innovation and production, infrastructure and trade flows, customs and logistics operation to run this complex matrix.

Related: Ex-director of Ukrspetsexport posted bail but he cannot leave London

The strategy sets clear goals and priorities for improving the competitiveness of Ukrainian exports:

  • Creating favorable conditions that stimulate trade and innovation to diversify exports.
  • Development of business support services and commerce can enhance the competitiveness of enterprises.
  • Strengthening the skills and competencies of enterprises required to participate in international trade.

To achieve the objectives need to work quickly, optimistically, and optimally.

It should be remembered that the global export train is moving fast and we are far behind. Therefore, we propose a clear plan for five years, which defines the 56 actual problems.

Our main objectives: education that meets the needs of business; infrastructure (from cars, ferries and container combinations to Silk Road); active "single window" at customs; adequate currency regulation; available information about foreign markets; free trade agreements that work for Ukrainian business.

Related: Ukraine to step up export to Canada tenfold during five years

We have analyzed the current state of our exports and identified promising sectors and markets.

The sectors were selected on the basis of cluster approach to determine the future path of development. Thus we considered today available resources and competitive advantages and increasing demand in overseas markets. Thus, among the selected sectors are parts of aerospace- and aviaproduction, technical maintenance of the ships, creative industries, tourism, informational technologies, food and beverages,  organic products.

The next question is what foreign markets are our priority? We need strategic work in every foreign market to increase Ukrainian exports.

On the basis of the gravity model, we identified a list of countries with which Ukraine now undertraded markets.

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We went further and took into account other factors and features of the external market and went to the "long list" of promising markets. This is EU market and 20 other markets, the main criteria for selection were their size, projected growth, openness to imports, conditions for access, the availability of the concluded free trade agreements, the potential consumption of food (as a factor base potential consumption), neighborhood (as logistics criterion and the criterion of cultural and historical affinity) mutual conformity of exports and imports, the growth dynamics of our exports of goods and services in recent years.

However, it is important to get the "feedback" from the expert community to narrow the list to those markets in focus, are able to show results pretty fast export growth, provided appropriate work with them. For this now there is an open poll where each exporter practitioner or someone who is planning to export, can express the opinion.

Related: Ukraine in top 3 countries that export agricultural products to EU

And that is not all. For effective implementation of the strategy we need to: implement daily action plan to develop sectoral, cross-sectoral, and regional strategies; create defined markets in focus detailed plans for promotion of Ukrainian goods and sell them; and most importantly - to work and interact.

First, we need to work action plan. Therefore I appeal to all, to provide clear proposals to the text of the Roadmap trade and draft Cabinet of Ministers of Ukraine "On Approval of the Export Strategy of Ukraine: Strategic Roadmap trade for the period 2017-2021 years" before April 28, 2017.

Our only way to be successful is to get out of the comfort zone, and to overcome stereotypes, not seeking short cuts to work and move forward. We must be creative, forward-thinking and motivate each other.

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