Ukraine’s economy needs our support
As published in The Globe and Mail
Ukraine’s new Ambassador in Ottawa, Yuliya Kovaliv, describes her country’s economy as the “third front” in the war caused by Russia’s unprovoked invasion. This is a decisive front on which Canada can engage. Just as we are already supplying humanitarian aid and military equipment, we must also help support Ukraine’s economy.
The world has witnessed countless heroic acts of Ukrainian resistance since Russian troops poured over the border. Any such list must include those who risk their lives daily to protect Ukraine’s economy. Every morning, millions of Ukrainians go to work even though their places of business could be targeted by missile strikes.
Remarkably, despite the devastation in those areas subjected to the most horrific fighting and bombing, as of last month less than half of all Ukrainian-based businesses had been forced to scale back operations due to Russia’s invasion and fewer than five per cent of Ukrainian firms had been forced out of business entirely.
Still, no modern, advanced, national economy can sustain itself without trade and investment. Ukraine wants to do business with Canada and, to that end, here are three ways Canada’s public and private sectors can answer the call.
First, we must update our 2017 free trade agreement. Our two countries had committed to doing so prior to the invasion and those efforts must now be given greater priority. We should focus, in particular, on expanding the agreement to cover investment and trade in services as Ukraine’s services sector has proven especially resilient.
In recommending this, we know Ukrainian officials are seized with the tragically urgent situation at home. Canada should therefore look to areas where it can act unilaterally. That is why the Business Council of Canada supports the removal of tariffs on goods from Ukraine and urges the removal of other unnecessary barriers to trade.
The re-opening of our embassy in Kyiv is an important development given that negotiating in person is always more efficient, effective, and conducive to reaching an agreement. The gradual restoring of greater access to our Trade Commissioner Service will also help Ukrainian businesses connect with potential Canadian customers.
A second way we can help support and sustain Ukraine’s economy is by looking for opportunities to work with Ukraine’s agricultural sector. Ukraine and Canada are among the world’s top five wheat exporters. Notwithstanding the war, Ukrainian farmers have planted crops in 70 per cent of the country’s arable land.
Given the Russian offensive in eastern regions of the country, a looming challenge to the Ukrainian economy may be a shortage of agri-food processing and exporting capacity for the resulting fall harvest. Here Canadian food processors, equipment manufacturers, and others in the agri-food sector may be able to help.
During his surprise visit to Ukraine this past weekend, Prime Minister Trudeau pledged the Government of Canada would help Ukraine find ways to export grain which it currently has in storage and is ready to ship. Here again Canadian businesses, those in the transportation and logistics sectors, may be able to offer some assistance.
Finally, a third area where we should seek to expand bilateral business ties is the energy sector. Russia’s invasion has had a seismic impact on global energy markets, particularly in terms of oil and gas. Both Ukraine and Canada have called for the acceleration of the energy transition to renewable and low-emission resources.
In this, we must deal with both geopolitical and geological realities. Canadian companies have been working for years with Ukrainian partner agencies to help reduce reliance on Russian resources, including uranium. This work is continuing even now, and it has never been more important to Ukraine or to the rest of Europe.
Of course, Russian forces have damaged – and in some cases destroyed – vital energy infrastructure in Ukraine. Hence their greatest need may be for Canadian engineering and construction companies to help with the rebuilding and recovery effort both now and, as Ambassador Kovaliv asserts proudly, “after the victory.”
All of us look forward to the day when Ukraine’s sovereignty and territorial integrity have been restored, and when circumstances allow business leaders to travel to Kyiv and meet with their Ukrainian counterparts. In the interim, the best way for Canada to help Ukraine – outside of military support – is to support their economy.
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