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Strategic directions of Ukrainian engineering post-war recovery

Author

Listed:
  • Оksana Kushnirenko

    (Institute for economics and forecasting NAS of Ukraine)

  • Natalia Gakhovich

    (Institute for economics and forecasting NAS of Ukraine)

Abstract

Relevance of the research topic is explained by the need to develop and implement effective measures to respond to economic losses caused by the military actions of the aggressor country. Targeted attacks by the enemy are aimed at destroying Ukraine as an industrialized state, not only to affect the civilian population but also to destroy the industrial potential. As a result, Ukraine has suffered irreversible losses of industrial potential, which amount to about 30%, destruction of manufacturing and logistics chains, loss of access to resources (both raw materials and human resources), complications in doing business due to interruptions in energy supply and communications, etc. Although the Ukrainian economy is currently in a state of uncertainty during the war, the prospects for the development of industrial enterprises and their ability to conduct business, create high-paying jobs and conditions for normal operation require strategic planning for post-war recovery based on European principles. Formulation of the problem. Finding answers to today's military challenges and justifying tools for preserving existing and developing new machinery production will help the country fulfill its most important functions by strengthening the ability of Ukrainian machinery enterprises to occupy market niches for the production of climate-friendly energy technologies for the EU's green and digital transition (wind turbines, heat pumps, solar panels, renewable hydrogen); machinery products of russian and belarusian origin, etc. Analysis of recent research and publications. The importance of industrialization and industrial policy for the development of industrial sectors, including machinery, is widely discussed in academic and political circles. Various aspects of the development of the machinery are reflected in many scientific works of foreign and domestic researcherss, as well as numerous publications of international organizations such as the World Bank, the UN, the European Commission, UNIDO, etc. At the same time, most publications do not provide answers to the military challenges to recovery the industrial potential of the machinery, which makes this study relevant. Selection of unexplored parts of the general problem. The lack of justification for strategic initiatives to facilitate the adaptation of Ukrainian machinery to the global challenges of the future (military, political, digital, financial, investment, environmental, technological, social, etc.) widens the gap between Ukraine and the developed world and only increases the effect of deindustrialization of the country's economy. Economic recovery and economic sustainability cannot be achieved without strategic development planning based on the joint efforts of all economic actors, including representatives of business, science and the state. Setting the task, the purpose of the study. The purpose of the study is to formulate strategic tasks for post-war reconstruction with the identification of perspective types of Ukrainian machinery, based on the pan-European vector of integration and ensuring national interests. Method or methodology for conducting research. The study uses general scientific methods: abstract and logical, induction and deduction, systematic approach; analysis and synthesis, as well as special research methods: statistical comparisons, grouping, sampling (to assess the dynamics of sales of machinery, foreign trade indicators and the number of employees as basic indicators of development trends); structural and functional analysis, expert assessments in developing recommendations for effective support tools for Ukrainian machinery. Presentation of the main material (results of work). The machinery provides an economic multiplier effect for related sectors of the economy, united by a single technological chain. The hostilities led to a 70% loss of Ukrainian exports of machinery products from the level of 2021 (6107.56 million USD in 2021 vs. 4216.9 million USD in 2022). The loss of production capacity is offset by significant imports of machinery products in the amount of 15983.54 million USD in 2022, which confirms the high import dependence of the domestic market for machinery building products. The machinery industries are strategically important for socio-economic development, as they concentrate a significant number of jobs (almost 15% of industrial workers in 2021) with a fairly high level of wages. The field of application of results. Strategic directions of the machinery post-war recovery are an important component of strategic planning and selection of effective industrial policy instruments for the Ukrainian manufacturing recovery and opposition of negative manifestations of military challenges with the realization of opportunities associated with changes in the global geopolitical space. Conclusions according to the article. The preservation of existing and development of new machinery production facilities, as well as the realization of opportunities to occupy market niches in the European and world markets of machinery products vacated by the sanctions against Russian and Belarusian manufacturers, as well as to diversify its own production and become a member of global machinery value chains for the aviation, rocketry, medical, and military industries of the world industry depend on the implementation of industrial policy instruments proven in other countries such as networks of industrial parks, stimulating cluster movement, promoting partnerships with foreign manufacturers), supporting export activities and diversification of production, introducing incentive and compensation mechanisms at the state, regional and local levels; expanding domestic demand for domestic engineering products in the post-war recovery.

Suggested Citation

  • Оksana Kushnirenko & Natalia Gakhovich, 2023. "Strategic directions of Ukrainian engineering post-war recovery," University Economic Bulletin, Hryhorii Skovoroda University in Pereiaslav, Faculty of Financial, Economic and Vocational Education, issue 56, pages 5-15, March.
  • Handle: RePEc:aff:colart:y:2023:i:56:p:5-15
    DOI: https://doi.org/10.31470/2306-546X-2023-56-05-15
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    Cited by:

    1. Zaoxian Wang & Dechun Huang, 2023. "A New Perspective on Financial Risk Prediction in a Carbon-Neutral Environment: A Comprehensive Comparative Study Based on the SSA-LSTM Model," Sustainability, MDPI, vol. 15(19), pages 1-22, October.

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