Oleksandr Matiushenko, member of the board of Pivdenny Bank: How can business overcome the consequences of war?

Business can overcome the consequences of war, if it prepares an effective response to four main challenges faced today – military economy, concentration of resources and power in the state, imbalance on the labor market and limited export opportunities. This was told by director of corporate business department, member of the board of Pivdenny Bank Oleksandr Matiushenko at the 21^st Forum of Financial Directors.

The first challenge is that the economy of Ukraine did not completely feel shock from a full-scale war. Current stability is supported by external assistance and tough restriction of financial market. But with normalization of the external assistance, monetary and fiscal policy the economy will look for a new balance, which will be a challenge for businesses.

“We understand that until hostilities last, funding by foreign partners will continue. However, it is important for the business to manage liquidity and investments in a weighed manner already today, using both classical and neoclassical tools of banking sector. This must be diversification of contributions of funds by tools and terms, allocation of risks, formation of reserves and their use for the development of new directions – it is important not to spend funds for uncertainty and investments that will not give effect in a short term prospects. It is also worth watching for signals of the development of situations which will help save stability of financial models of your business – macroeconomics, internal policies, global struggle for power, etc.,” shared Oleksandr Matiushenko.

Second challenge concerns concentration of resources and power in the state – all internal resources are directed for a war, and restoration programs are coordinated by the state and international institutions.

“We understand that during the war the power is a key stakeholder, and it is necessary to set relations with it. Firstly, to integrate into the processes of state procurements and tenders. Secondly, to put pressure on the power in the context of transparent expenditures and implementation of reforms,” noted he.

The third challenge is an imbalance on the labor market, which only accumulates. In the negative scenario a number of capable people will decrease with the bankruptcies of enterprises, and in the positive scenario – the demand for them will revive due to reconstruction and investment programs.

“Today people have primary meaning, therefore business has to focus on this questions. Find out key employees, develop the succession programs, automate the processes and training and retraining programs, develop the internal mobility and flexibility,” advised Oleksandr Matiushenko.

And the fourth challenge, according to him, concerns limited export opportunities of Ukraine:

“Restoration of export potential will need significant investments and a long time, so it is necessary to invest in potential of our country right now. To invest in the development of internal processing of products, which will allow selling on the domestic market and exporting the goods already as products with added value, and also in the development of useful fossils – since they are energy carriers, which we have in abundance, and in the import substitution production”.

“If business will respond correctly to all these challenges already today, it will be able to overcome the consequences of war and fix an effective further work,” added Oleksandr Matiushenko.

Pivdenny Bank traditionally acts as a partner of the Forum of Financial Directors, which has been the main discussion platform for economists, businessmen and reputable experts in the field of finance for more than 20 years already.