Big future for small businesses: first East Expo 2017 welcomes 100 businesses and 4,000 visitors in conflict-affected Donbas

Mar 27, 2017

Kramatorsk and Severodonetsk, March 27, 2017 -  Small and medium businesses from Donetsk and Luhansk regions gathered from March 21-24 at East Expo 2017, a new initiative aimed at boosting small business development in the Donbas region.

The forum was organized by the United Nations Development Programme with financial support from the British Embassy in Ukraine.

Over 100 businesses took part in the two business expos, which were held as two-day events first in Kramatorsk and then in Severodonetsk. Not only did small business owners and managers from various industries present their products and services, but they also took part in peer-to-peer networking, and advanced business training. They also used the event to identify potential partners and find new clients. Through panel discussions, presentations and event features, some 4,000 visitors to both business expos learned about business success stories, innovative technologies, business infrastructure development and opportunities for market expansion in the food, light and chemical industries. Leading business experts and representative from international organizations shared information about ongoing programmes, services and resources for entrepreneurs in the region.

“We expect a very positive outcome from these business expos. East Expo 2017 is not only about attracting new clients and potential partners – it is also a chance to talk about your business beyond Donetsk and Luhansk regions,” said UNDP Recovery and Peacebuilding Programme Coordinator Mustafa Sait-Ametov. “Also, entrepreneurs and would-be entrepreneurs have obtained new knowledge at business workshops, training sessions, and open dialogues. We have significant plans to continue supporting small and medium businesses from this region. We will launch a small grants programme, training courses and business consultations. The future of the Donbas region lies in small and medium businesses, which can give the local population a stable income. This is the goal we’re moving forward to.”

Visitors to East Expo 2017 learned of success stories from entrepreneurs who have previously received a UNDP grant, helping them launch their own businesses, and successfully develop them. Each visitor could participate in a raffle and vote for their favorite businesses. The three winners from Donetsk region were a cheese making company called “Say Cheese”; “Meat Trade”, a company specializing in meat production, and “Kramtehtsentr”, a company specializing in equipment manufacturing. In Luhansk region, the Markovsky cheese factory, the “Nemushenko” packaged sunflower seeds company and “Starkon” confectionery products company were selected as the visitors’ favourites.

“The overall goal of East Expo is to create more new jobs for local populations,” said UNDP Specialist for Employment and Entrepreneurship Development Oleksandr Osovets. “Many enteprises expressed an interest to participate at this first East Expo, and we selected those which can potentially create more jobs. UNDP has already supported over 530 businesses in eight regions of Ukraine, and they have created at least 2,000 new jobs. And we’re not going to stop there.”

East Expo 2017 was organised in partnership with Donetsk and Luhansk Regional State Administrations, Donetsk and Luhansk Chambers of Commerce and Industry, and Donetsk and Luhansk Regional Development Agencies.

 

Background

The armed conflict in eastern Ukraine has taken a heavy toll on small and medium-sized enterprises (SMEs) in Donetsk and Lugansk oblasts. Donbas SMEs accounted for 13% of sales by Ukrainian SMEs in 2013. In 2015, the share SMEs in the government-controlled part of Donbas in total SME sales fell to just over 3%. Many SMEs have closed or relocated to other parts of Ukraine. Still over 60,000 private entrepreneurs and corporate SMEs have continue working in government-controlled areas of the Donbas. The remaining Donbas SMEs work in extremely difficult conditions. The conflict has disrupted infrastructure, including roads, bridges, rail links and power lines. Businesses have lost access to major population centers on the other side of conflict line, and customers in other regions of Ukraine are sometimes reluctant to do business with Donbas companies. The bank network in the Donbas is well developed, with at least two bank branches in most towns in Donbas GCAs. However, getting bank credit may be very difficult for Donbas SMEs, both due to risks involved, and legal prohibitions on repossessing collateral in Donbas.

Media inquiries:

Yevgeniy Zelenko, UNDP Ukraine Media Officer | +38 044 254 0035 | yevgeniy.zelenko@undp.org

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