Ukraine - Country Profile

IT Sector

The information technology (IT) industry has become one of the key pillars of Ukraine’s economy and plays a crucial role in its development. The sector stands out with the following figures:

• $6.7 billion in IT service exports.
• IT service exports represent 4% of GDP, a figure that has increased 5.7 times over the past decade.
• 41% of service exports are IT services, an increase of over 35 percentage points since 2013.
• IT services account for 13.2% of total goods and service exports.

Ukraine ranked among the top 10 countries for IT-friendly reforms in 2020, according to the World Bank. According to the Good Country Index, Ukraine ranks first globally in its overall contribution to science and technology.

Ukraine has a strong IT sector, with innovative companies and a vast pool of highly skilled professionals. The country attracts foreign investors and partners thanks to its software development efficiency and high level of technological expertise.

Sources: Diia, Ukraine IT Association

Agriculture

Ukraine has exceptional conditions for agriculture, with about one-third of the world’s most fertile land. The agricultural sector is the third pillar of Ukraine’s economy. In 2021, it accounted for:

• 10.9% of Ukraine’s GDP.
• 41% of exports, reaching $27 billion.

Ukraine is one of the world’s leading producers and exporters of staple agricultural products, supplying food to many countries in the Middle East and East Africa, and influencing global food prices. Before the Russian invasion, Ukraine provided 50% of the grain reserves for the United Nations World Food Programme (WFP), the largest humanitarian organization in the world.

By the end of 2023, Ukraine’s agricultural sector had suffered losses and damages estimated at around $80 billion. Restoring the sector is expected to cost $56.1 billion.

Source: European Parliament

Energy

The energy sector is one of the most promising in Ukraine. The country’s energy strategy through 2050 sets clear priorities for the development of renewable energy sources and the use of innovative technologies to modernize Ukraine’s energy sector.

Russian attacks on energy installations have caused considerable damage, estimated at over 56 billion dollars. The most significant losses were the destruction of electricity production facilities (8.5 billion dollars), main electricity transmission lines (2.1 billion dollars) and oil and gas infrastructures (3.3 billion dollars). Consequently, restoring this sector in line with sustainable development objectives is a priority for the coming years, and will require substantial funding from both the state and international sources.

By 2050, Ukraine has the potential to increase its wind generation capacity to 140 GW, solar generation to 94 GW, energy storage to 38 GW, nuclear generation to 30 GW, cogeneration and bioenergy capacity to 18 GW, and hydroelectric generation to 9 GW.

Investment opportunities in new energy capacity total $383 billion. The investments break down as follows: wind generation ($134 billion), solar generation ($62 billion), hydrogen technologies ($72 billion), energy storage ($25 billion), nuclear generation ($80 billion), transmission systems ($5 billion) and hydroelectricity ($4.5 billion).

Sources: Ministry of Energy of Ukraine, Kyiv School of Economics

Industry

Traditionally, industry has been a key sector in Ukraine, with metallurgy and machine building accounting for the largest shares. In 2020, Ukraine exported $5.4 billion worth of mechanical products, representing 11% of total product exports.

Ukraine has the potential to become a regional leader in complex, knowledge-intensive engineering services such as industrial automation, advanced engineering, high-tech industrial programming, and industrial design (electrical, mechanical, electronic, etc.).

• Ukraine has large reserves of raw materials and a well-developed metallurgical sector.
• Ukraine has a highly qualified workforce. Around 10,000 students graduate each year from the machine-building faculties of the country's universities.

The metals industry, including the extraction and processing of iron ore, the production of iron and steel, and the rolling of steel, is a fundamental sector of the Ukrainian economy. Before the war, Ukraine was the world's fifth largest exporter of iron ore, fourth largest exporter of iron ore pellets, and third largest exporter of pig iron and slabs. Ukraine is also the sixth largest exporter of finished steel to the EU.

After the war, the steel sector has the potential to become a key driver of Ukraine’s economic recovery, provided that production facilities are modernized and decarbonized.

Sources: Diia, Ukraine Plan 2024-2027

Transport and Logistics

Logistics is crucial for every country and affects all other sectors of the economy. Ukraine has significant potential in this field due to its strategic geographic position, making it a major transit corridor between Europe, Asia, and the Middle East. Given the destruction caused by Russia and Ukraine’s path to EU accession, modernizing and rebuilding the sector is now of critical importance.

The war has further underscored the importance of logistics. Quick repairs of damaged infrastructure and the implementation of the EU-Ukraine Solidarity Lanes have enabled Ukraine to export over 122 million tons of goods and import approximately 45 million tons of essential products between May 2022 and February 2024 via Danube ports, road transport, and railways.

The transport sector has suffered severe damages estimated at €30.5 billion according to RDNA3. The key reconstruction needs are:

• National roads (29%)
• Rail infrastructure, rolling stock, equipment, and other assets (24%)
• Local roads (16%)

The priority is to restore and expand Ukraine’s export logistics capacity, with a strong focus on the TEN-T network. In this context, reforms and investments in all transport sectors—including roads, railways, inland waterways, maritime transport, and aviation—will be essential in the coming years.

Source: Ukraine Plan 2024-2027