“What’s Up With the Economy?” is a podcast by the Centre for Economic Strategy in cooperation with Hromadske Radio, supported by PrivatBank.
Every week, hosts Anheina Zazadex and Maksym Samoiliuk talk with experts, entrepreneurs, analysts, and government officials about what is happening with Ukraine’s economy.
While the podcast is held in Ukrainian, we decided to summarise each issue with the most important insights.
We recorded a new podcast episode with Nataliia Kolesnichenko, Senior Economist at the Centre for Economic Strategy, and Svitlana Kobelieva, co-owner of TeaHouse — one of the largest Ukrainian importers and producers of tea.
We discussed reconstruction — from major infrastructure projects to private housing and businesses, including the case of TeaHouse, which was damaged by a russian strike in Dnipro.
The most interesting highlights from the conversation are below:
How critical the strike in Dnipro was for TeaHouse:
On the night of July 26, a Russian missile hit TeaHouse’s production facility in Dnipro. According to Svitlana Kobelieva, nothing was left of the production site:
“We lost almost everything, without even using the word almost. The production equipment, machines, raw materials, finished products — everything we had accumulated over the summer to enter the season was wiped out completely.”
The company receives the largest volume of tea shipments in July to prepare for the season, which lasts from September to April. The strike during this period completely derailed preparations and caused significant losses.
“The damages were documented, but let’s keep them classified, because sometimes these are figures that are frightening even to admit to oneself or imagine (…) What we can say: we applied for a grant, and our equipment was valued at 4 million hryvnias.”
Which sectors of the economy suffered the most during the war:
According to the World Bank, housing suffered the greatest losses in Ukraine ($86 billion). In business, the four sectors with the largest damages are:
“First place is transport, because we lost many ports, air travel was suspended, and the entire transport infrastructure was severely affected. Second is extraction and energy (…) Many mines located in Donbas were occupied, destroyed, or shut down, as happened, for example, with the mines in Pokrovsk. Third is manufacturing, including tea production, as well as trade. For instance, the loss of Azovstal and the Illich Steel and Iron Works alone amounts to more than $4 billion,” said Nataliia Kolesnichenko.
According to the World Bank, restoring these sectors will require more than $500 billion, which is almost three times Ukraine’s annual GDP in 2021.
What to do after a strike:
“The first thing I did was write to all my friends and ask who knew what to do, because there was no information. But I was surprised that on Saturday morning, when I reached out, I was given the contact of one of the reconstruction committees, and this person provided me with a complete list of instructions: which reports I needed, which documents to collect, and what applications to submit,” said Kobelieva.
After that, the damage documentation procedure began: filing reports with the National Police and the State Emergency Service, taking photo evidence, and bringing in a court expert. According to Kobelieva, all the necessary information is available online.
“Already by Sunday, we understood which products we could restore right away through our horizontal ties with other businesses, and which companies would help us with outsourcing. Many companies called and even offered to reconfigure their production lines so that we would not lose the uniqueness of our packaging.”
Which industries are recovering the fastest:
The biggest losses are concentrated in regions close to the occupied territories or the front line. The larger the losses in a region, the less likely it is to recover quickly. However, this does not apply in the same way to specific industries:
“The greatest losses were recorded in the transport sector, particularly due to the suspension of air travel, which cannot yet be restored. But changes in logistics – how companies are setting up new export routes, and the reopening of ports – have driven significant investment in transport,” explains Kolesnichenko.
Who is financing reconstruction:
The main investments in recovery are being provided by Ukrainian businesses themselves. International support exists, but it is limited and mostly directed at small and medium-sized enterprises.
TeaHouse was one of the first companies to apply for a grant to restore processing enterprises:
“Even though grant support is small, it gives you confidence that at least part of the costs can be covered by grant money, and at least it’s one thing you don’t have to worry about.”
The greatest losses were in raw materials, which grants cannot cover, so the company is seeking other financing options.
“We’re looking for more credit funding — the 5-7-9 program and EBRD (European Bank for Reconstruction and Development) guarantees. But even there, it’s complicated: when a company loses all of its assets, collateral is required for these loans.”
How big business is recovering:
Large companies have more capacity to rebuild: if one part of production is destroyed, they can rely on other facilities.
“For example, Metinvest’s steel plants in Mariupol were lost. But now Metinvest representatives say they are operating at 65–70% of pre-war production capacity, because they have restored operations at the plants that remain,” adds Kolesnichenko.
A telling example is the mines in Pokrovsk, which were replaced by imports of coking coal, critically important for metallurgy. This shows the sector is gradually recovering.
Is the tea business developing in Ukraine:
“Our industry is actually showing growth, with new, exciting brands entering the market. Small businesses are opening tea shops, since they can be repurposed from other areas.”
According to Kobelieva, the tea business is becoming more popular because healthy nutrition and a healthy lifestyle are increasingly becoming priorities.
“What’s Up With the Economy?” is a podcast by the Centre for Economic Strategy in cooperation with Hromadske Radio, supported by PrivatBank.
The podcast is available in Ukrainian on different platforms by the link.
