Support during the war: how the state provides grants and restructures business debts
Kyiv • UNN
Ukrainian businesses receive systemic support from the state through financial instruments, including grant programs and preventive debt restructuring. This helps enterprises to withstand the war, preserve jobs, and pay taxes.
Ukrainian business has been operating in difficult economic conditions for more than three years: infrastructure destruction, property loss, logistics restrictions, economic uncertainty, a devastated labor market, and reduced demand. After all, the war is not only fought on the battlefield. It has become a real test for business and for the Ukrainian economy as a whole. Despite the difficult conditions, entrepreneurs continue to work, and with their daily actions, they keep the Ukrainian economy afloat, UNN reports.
All this would be impossible without systemic business support, particularly through financial instruments implemented by state banks. It is such structures as, for example, "Privatbank", "Oschadbank", Ukreximbank, and Ukrgasbank, that have become one of the key channels of business support during wartime.
One of the introduced tools for supporting Ukrainian business was "preventive debt restructuring". Thus, companies that took out loans for business development, even before the full-scale invasion of the Russian Federation into Ukraine, thanks to this economic instrument, can redistribute the financial burden and not go bankrupt - stay afloat and continue economic activity, and as a result, pay taxes.
Preventive debt restructuring provides for:
- extension of loan repayment terms;
- reduction of interest rates;
- credit holidays;
- new payment schedules.
It is thanks to preventive restructuring that businesses affected by the war and partially losing financial flows get a second chance: to save the team, stay on the market, adapt to new conditions, and prepare for development after victory.
State banks that implement debt restructuring perform an important function not only as creditors but also as partners in preserving the Ukrainian economy. And the fact that such practice is becoming systemic is a sign for Ukrainian businessmen that Ukraine will not abandon entrepreneurs with their problems alone.
Along with this, Ukraine has a preferential lending program "5-7-9%", which allows small and medium-sized businesses to attract the necessary financing on favorable terms. In addition, the state provides guarantees for loans, which reduces risks for banks.
But not by loans alone. Despite the war, the Ukrainian authorities have also expanded state support programs for small and medium-sized businesses, particularly in the areas of processing and agricultural production.
Thus, the grant program for businesses in the processing industry allows enterprises to receive up to UAH 8 million in state support, provided that 5 to 25 new jobs are created. At the same time, a mandatory condition for the program is co-financing from the business: 50% for enterprises located in safer regions; 20% (i.e., 80% covered by the state) for enterprises in de-occupied or combat zones.
It is important to note that grant support covers a wide range of industries: from food processing to woodworking, textiles, household chemicals, and cosmetics. At the same time, companies that produce products that could replace imported ones are a priority.
The state also did not forget about grant programs for agricultural producers. Thus, under the "My Garden" program, the state compensates up to 70% of the project cost for horticulture, berry growing, and viticulture. Funding covers the purchase of seedlings, irrigation systems, equipment, fences, etc.
Another grant program, "My Greenhouse," focuses on the construction of greenhouse complexes with an area of up to 2.4 hectares. The amount of funding is up to 7 million hryvnias "in one hand." Among the conditions for receiving the grant: the creation of at least 4 permanent and 10 seasonal jobs, as well as conducting activities for at least three years after receiving funding.
As for other farming areas, the state has introduced subsidies of UAH 4,000 per 1 hectare of cultivated land. For farmers with a land bank from 1 to 120 hectares. To strengthen and support farmers who managed to save their enterprises after the start of the full-scale invasion.
Such support for Ukrainian business is not an indulgence or a "gift"; it is an investment in the country's economic stability. After all, when an enterprise gets the opportunity to survive a crisis more easily, it saves jobs, fills the budget with tax revenues, and develops Ukraine in various directions. If this support did not exist, Ukraine would face mass bankruptcies, rising unemployment, falling budget revenues, and general social tension.
Instead, these tools contribute to the survival of businesses in conditions of military instability, and also stimulate reinvestment, technological renewal, and the restoration of production and supply chains. It is also important that the programs cover businesses not only in relatively safe regions but also those most affected by hostilities.
During the war, Ukraine has no right to lose entrepreneurs – on the contrary, it must do everything to ensure that business survives, works, and becomes a driver of economic recovery after the victory. The state in this situation is not only a regulator but also a partner.
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Another tool to support business will be an annual moratorium on inspections, which has already been signed by Ukrainian President Volodymyr Zelenskyy.