Is it Easy to Start a Business in Ukraine?

Jenny Holt

Seniors who might think of retiring in Ukraine can explore another dimension to their golden years - starting a business in the country to supplement the income of a pension. But, before you actually put your entrepreneurial ideas into action, weighing the pros and cons of going into business in the country has its merits.

Advantages

Ukraine is an emerging economy and has a large consumer market. In terms of potential, the Ukrainian market is worth more than £500m for the UK. Exports were valued at $40.82bn in 2014 by the World Bank. This means there is a wealth of opportunity in the country.

Ukraine possesses a skilled and educated workforce which will make it easy for you to find local labor should you decide to start an enterprise in the country. 

In addition, the cost of labor is relatively low and highly affordable. Hence, if your business is going to look at the services sector, you are going to get a steady supply of low-cost labor.

Another advantage of doing business in Ukraine is the country has an abundant supply of natural resources so there are reliable sources of raw materials should you decide to go into the manufacturing sector.

Disadvantages

One of the main disadvantages in starting a business is the long process associated with incorporating a firm. As an entrepreneur, you have to register and incorporate your company. The process includes registration at the Registration Office, opening of a permanent bank account, signing up at the State Authority Tax centre and obtaining a VAT number. Once these are done, you must look for office space, get your electricity connections and Internet set up, buy supplies and recruit one or two local staff to help with the business. 

Admin work can sometimes be arduous, but the country is moving towards easing these burdens to attract investment in the country. Other risks include security and political instability.

How to Proceed

Starting a business in Ukraine after retirement is not for everyone. But if you do decide to go for it, the best approach is to start small, test the market and see where it brings you. Initially you should probably try to do most tasks from your home. Consider finding a business partner so that you are not alone in going through the setting-up and managing of a business. Partnering with a national who has knowledge of the local settings, laws and language might be a good approach. If you are unsure of your partnership, get a legal opinion on it. 

Finally, take advantage of counselling and advice provided by the Embassy. The trade and commercial section is there precisely to help promote interests abroad so ensure that you tap its services for information of a legal/technical/logistics assistance.