Czech companies are already penetrating Ukraine

Companies started receiving the first orders related to the restoration of Ukraine. Either they have received specific offers and are already implementing them, or they are still in the preparation phase. This follows from a new investigation between members of the Union of Industry and Transport and the Chamber of Commerce.

Companies started supplying Ukraine mainly with medical equipment or agricultural machinery. But they are also seeking contracts for the renewal of energy, transport and water infrastructure, construction work and materials.

“Surprisingly, the first orders are mainly obtained by companies that have not yet had any experience with deliveries to Ukraine. We assumed that companies that already have developed business ties in Ukraine and are therefore well versed in the Ukrainian legislative environment and administrative processes, as well as in logistics, will be successful in obtaining contracts. However, there are only a fifth of such companies, the overwhelming majority are newcomers to the market,” said Zdeněk Zajíček, president of the Chamber of Commerce.

Ukraine is also approaching Czech companies on the basis of a list of companies that representatives of the Czech government, led by Prime Minister Petr Fiala, provided to Kyiv during the first Czech-Ukrainian intergovernmental consultations a year ago. At that time, 103 companies from various sectors, mainly from the mining and processing of mineral resources, engineering, construction and energy, applied to the Chamber of Commerce for cooperation in the restoration of the land. The survey shows that every sixth company received offers from Ukraine. Every tenth company already implements orders.

Most of the companies that offered their products and services to Ukraine have not yet established any business relationship. The investigation showed that establishing business relations with Czech companies is complicated, among other things, by a lack of information and the problematic obtaining of state guarantees and insurance.

“These barriers could be completely removed with greater cooperation between the state and company representatives. Especially for companies that have not executed any contracts in Ukraine in the past, it will be important what support the state and the Export Guarantee and Insurance Company are willing to provide,” said Jan Rafaj, president of the Union of Industry and Transport.

The Union of Industry and Transport and the Chamber of Commerce therefore addressed the request to the Ministry of Finance and the Department of Industry and Trade to reallocate the remaining funds from the Covid Plus rescue program to the resources of the EGAP insurance company. In this way, insurance capacities for exports to Ukraine could be expanded. In response, the Minister of Finance promised that in the near future, after evaluating the success and return of funds used to insure export risks to Ukraine, he will consider the possibility of strengthening EGAP resources. At the same time, he stated that after the end of the war, export insurance should already work under the standard conditions of the products offered by the state insurance company.

According to business organizations, the capital with which they can finance the contracts will also influence how big a part in the reconstruction of Ukraine Czech companies will ultimately play in the competition of other countries.

Source: HK and SP CR, survey Renewal of Ukraine, 196 respondents