During the war, many industrial firms were damaged or destroyed, while the rest have major problems with working capital, demand and logistics. Power cuts in October-December were also added to this list. In 2022, Ukraine's GDP will temporarily down by 30.4%, while the State Statistical Service does not currently publish this data, so it is not known how much industrial production has decreased. However, it is clear that the decrease in industrial production in Ukraine last year was at least 30-40%, which threatened the post-war deindustrialization of the country.
Neither in the pre-war period nor during the war did the Ukrainian authorities have a systemic industrial policy. For example, at the very beginning of the war, the authorities abolished VAT and duties on all imported goods, but from 1st July, 2022, this decision was lifted. In contrast, the introduction of a 2% single tax on turnover, which was scheduled to be cancelled by the middle of this year, has not had much impact for large backbone companies.
The displacement of enterprises can be considered a separate aspect of industrial policy in war conditions. By the end of November 2022, more than 770 businesses had moved their operations to safer areas, and more than 600 of them were already working at a new location.
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