01 March 2011

Ukraine - Country Risk

Foreign investors are needed in Ukraine. Big time. Based on the fact that Ukraine is a low cost economy, the country should be able to offer a competitive advantage to international companies who are looking to enter the market in Ukraine for many reasons. Apart from Ukraine being a potential large domestic market, it could also offer opportunities to companies who are looking to establish a production/manufacturing base to serve the much wider markets in the EU and further.

Marketeers always need to consider the risks associated with market entry into any country.
All countries offer opportunities but also present a range of barriers to entry. The age old approach to consider is usually based on a PEST analysis. Political, Economic, Socio-cultural and Technology factors.

Unfortunately for Ukraine, the biggest barriers by far are the risks connected to political factors.
This is where a market research analysis has to be honest and give the thumbs down to many market entry plans in Ukraine at a very early stage.

An article today in the Kyiv Post presents some of these political risks in a simple way:
see: http://www.kyivpost.com/news/politics/detail/98619/

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