Ukraine Launches Major Investment Support Program
Mykola Siutkin
You do business, we mitigate risks | Business Investment Risk Advisor | Co-founder of S&P Agency | Attorney | Co-publisher LDaily | Ironman
The Government of Ukraine has launched a support program aimed at facilitating large investment projects. This initiative was marked by the signing of the program's first investment agreement during the "Made in Ukraine" business forum. The agreement involved the Cabinet of Ministers of Ukraine, Astarta-Kyiv LLC, and Astarta Agro Protein LLC, confirming state support for the establishment of a new soybean meal processing plant, capable of processing 500 tons per day, in the Poltava region. Yulia Svyridenko, the First Vice-Prime Minister - Minister of Economy of Ukraine, signed the agreement on behalf of the government.
During the forum, Yulia Svyridenko stated, "Today we launched a program to support projects with significant investments... we signed the first investment agreement with Astarta." She alluded to the operative nature of the "investment" mechanism and confirmed the government's backing of an additional investment agreement.
Astarta, a significant agricultural entity and a leading sugar producer within Ukraine and Europe, plans to invest over 76 million euros in enhancing technology and equipment to optimize the processing of agricultural products. The project is projected to generate 110 new employment opportunities and support the regional processing industry's expansion, including the introduction of innovative soybean cultivation and processing methods.
The state is extending numerous incentives to projects that align with significant investment criteria. These incentives include:
The program specifies that investors willing to inject more than 12 million euros into sectors such as manufacturing, mining, transport, education, healthcare, or tourism are eligible for state aid. Benefits offered to investors encompass cost compensations for network connection, infrastructure such as substations, power lines, gas pipelines, and tax-related compensations, with state support reaching up to 30% of the total investment volume.
This major financial support initiative demonstrates Ukraine's commitment to stimulating economic growth through the encouragement of significant investments in various industries.
A second agreement will be signed between the Cabinet of Ministers of Ukraine, Bukovell LLC, and Aquapark. This project is anticipated to create at least 82 new jobs and contribute UAH 469,780k in monthly tax revenue.
State support for projects with significant investments is a real opportunity to provide incentives for investors to invest in the development of their enterprises even during the war.
In total, we have allocated UAH 3 billion for this program in 2024 as part of the 'Made in Ukraine' policy.
How to Apply for Government Support
For entrepreneurs and businesses interested in partaking in investment projects in Ukraine, especially during these challenging times, here is a clear guide on how to apply for state support:
Preliminary Steps:
Consultation: Engage with UkraineInvest, the state institution responsible for facilitating the implementation of significant investment projects. They will help you understand the legal requirements, assess project feasibility, and navigate the application process.
Information: Gather essential data about your project. This involves a feasibility study, financial model assessments, legal aspects, market environment analyses, and more, to ensure your project aligns with the investment fields approved by the government.
Documentation: Prepare and collect all relevant documents, including those proving financial solvency and compliance with the statutory requirements.
Application Process:
Submit Application: Prepare a detailed application including all the required supporting documents and submit it to the Ministry of Economy of Ukraine. This ministry is the central executive body responsible for the formation and implementation of state investment policies.
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Review Process: The Ministry of Economy evaluates your project within 60 calendar days from receiving your application. Note that there is a provision for a faster assessment of 45 days if your financing comes from certain international financial bodies or organizations.
Compliance Verification: Within 10 business days, the Ministry checks the compliance of the submitted documents and applicant with the legislative requirements. Any inconsistencies can temporarily suspend the process, with a provision for amending the submissions.
Post-Submission:
Decision: Following a successful assessment, the Ministry of Economy prepares a proposal for a draft decision on signing a Special Investment Agreement (SIA).
Finalizing Agreement: The SIA is signed between the investor (or applicant), the Cabinet of Ministers of Ukraine, and likely a local governmental body, depending on the project's location and scale.
Implementation & Follow-Up:
Begin the implementation of your project according to the terms agreed upon in the SIA.
Receive ongoing support and monitoring from UkraineInvest and the Ministry of Economy to ensure the smooth execution and compliance of your investment project.
State Support Benefits
Eligible projects can benefit from numerous incentives, such as income tax and VAT exemptions, import duty exemptions, reimbursement for certain costs, and more aimed at reducing the operational burdens and enhancing investment attractiveness.
Further Information
For detailed guidelines, forms, and more extensive support information, you can visit the Official Investment Guide.