“The KfW has helped Ukraine from the very beginning”

Lawyer Andrii Gapon is managing director of the Business Development Fund in Ukraine, the successor to the German-Ukrainian Fund. Here he talks about the reconstruction of his homeland since the Russian invasion.  

Mr Gapon, the invasion by the Russian army has hit the Ukrainian economy hard. How are things going now? 
We’ve been struggling. But thanks to joint efforts and international support, the macroeconomic indicators are not bad: GDP is set to rise by 5.5 per cent in 2023 and inflation rates will fall. This is not least thanks to the Business Development Fund (BDF).  

What has the BDF contributed?
We support small and medium-sized enterprises with affordable loans and grants – a total of around 40,000 since 2022. We’ve ensured that farmers can continue to run their businesses, for example. Initially, we anticipated a sharp decline in agricultural exports and even a shortage of food for the Ukrainian population. One of the measures we took to prevent this was to support a major sowing campaign enabling farmers to go on with their work.  

What is the role of small and medium-sized enterprises in Ukraine today?
They account for 99 per cent of all companies registered here, so they’re actually the backbone of our economy. The coronavirus pandemic and the subsequent Russian invasion resulted in a sharp decline in economic activity among SMEs, however. This is why support through the BDF was needed, otherwise the economy would have been severely damaged. Our job has been to build up the economic front, if you like, and we’ve been crucial to keeping the economy going in the last 2.5 years. 

How important is Germany in connection with your work?
Very important. Let me go back a little in history here: operating through the KfW, the German government initiated the German-Ukrainian Fund in 1996. It was then officially established in 1999 by the Ukrainian Ministry of Finance, the National Bank of Ukraine and the KfW.