KYIV – Defying Ukrainians’ belief in EU protectionism, Ukraine’s exports to Sweden jumped by 34 percent during the first quarter of this year.

This growth followed a 21 percent growth last year and a 60 percent jump in Swedish exports to Ukraine, according to Swedish Ambassador to Ukraine Martin Hagström.

This dynamic trade relationship helped explain why the latest Sweden-Ukraine Business Forum drew 250 attendees Thursday, filling the hall in the Hyatt Regency Kyiv.

Although no major deals were announced, Kristian Andersson, local chairman of SEB bank said he is receiving a steady flow of inquiries about Ukraine from Swedish companies. The representative of the only Nordic bank in Ukraine, Andersson said some calls and emails come from Stockholm, some come from Swedish company affiliates in the Baltics. There are now two direct flights a day between Stockholm and Kyiv on Ukraine International Airlines.

Attendees hoped for hints about the big fish – IKEA. The Swedish furniture giant has 14 stores in Russia. For now, it is only studying opening in Ukraine.

Sweden’s Minister of Foreign Affairs Margot Wallstrom spoke to a standing room only event at the Hyatt (Swedish Embassy)

EU Access Depends on Free Market Changes Here

The forum’s key note speaker, Sweden’s Minister of Foreign Affairs Margot Wallstrom, reminded Ukrainians that the EU’s opening to Ukraine depends on continuation of free market changes here.

“To attract foreign investment, Ukraine must continue to reform the way the country operates,” said Wallstrom. “Once the courts are fixed, and corruption and red tape are reduced, investment will grow.”

Sweden is a major economic aid donor to Ukraine, giving $22-28 million annually. The aid is managed by the Swedish International Development Cooperation, which supports market development and human rights.

“Though we are friends of Ukraine, friends can be critical,” Wallstrom continued. “Ukraine could imperil recent advancements with the EU, including visa-free travel, if it does not uphold democratic principles.”

Forum attendees discuss business prospects between Sweden and Ukraine, two nations with long historical links. (Photo: Mark Satter)

Banker Wants Clean Courts

Andersson, also on the lead panel, said Ukraine has made progress since the 2014 Revolution of Dignity.

“Three years ago, the country was close to bankruptcy -- now, there is a steady exchange rate and a more or less stable economy,” said Andersson, whose SEB is formally called Skandinaviska Enskilda Banken.

“The government got rid of the bad banks,” he continued. “What Ukraine needs now is a fair and free court system.”

The top Ukrainian speaker, Stepan Kubiv, Minister of Economic Development and Trade, told the audience, which was heavily peppered with visiting Swedes: “Sweden remains a top ally of Ukraine in realizing our EU aspirations. Last year we saw a 2.3% increase in the size of our GDP, which will continue to grow as reforms continue.”

-- with additional reporting by UBJ Editor in Chief James Brooke

For comments and story ideas, please contact UBJ Correspondent Mark Satter at marksatter@theubj.com

Posted June 19, 2017