| Summary: | The article examines the consequences of the impact of Russia’s military aggression on
the current state of small and medium-sized enterprises (SMEs) in Ukraine. One of the priority
areas for the recovery of the Ukrainian economy from the consequences of the economic crisis
caused by military actions and the global crisis is the development of small and medium-sized
enterprises. Therefore, the purpose of the article is to analyse the dynamics of business activity of
small and medium-sized businesses within the domestic market and foreign economic activity,
considering the tax reform that has begun since the Russian Federation invaded Ukraine.
The subject of the study was chosen to be Ukraine’s small and medium-sized businesses
for several reasons: firstly, SMEs accounted for about 70% of employment in the country;
secondly, SMEs accounted for almost 60% of gross sales before the military situation.
The study used theoretical and empirical methods: induction, explanation, generalisation,
comparative analysis, observation and description, and the abstract logical approach was used
to make conclusions.
In our study, we took into account legislative changes and existing government support
instruments that contribute to improving the business climate in the country and, based on
secondary data, identified how the mood of entrepreneurs has changed and what the Ukrainian
business community should expect shortly, taking into account the reforms and the current
economic situation in Ukraine.
In addition, the study paid particular attention to the assessments of business
representatives, primarily to the expectations of industrial enterprises regarding the prospects
for developing their business activity, as expressed in the business confidence indicator and
the business climate indicator.
The paper has identified several problems that hinder the functioning of SMEs by
industry and identified several scenarios for developing SME business needs, taking into
account current government actions.
The main challenges to the development of SMEs were logistical problems, labour
shortages, a significant rise in the cost of raw materials and resources for production, risks
associated with hostilities and mining, blocking of foreign trade flows, forced relocation, etc.
In the face of these challenges, SMEs are trying to adapt by focusing on business processes,
building new development strategies, and becoming flexible. However, a significant proportion
of Ukrainian SMEs have been forced to refocus on export development due to the decline in
the purchasing power of citizens.
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