Small and Medium Business Outlook in Ukraine: Rising Concerns Over Economic Stability and Future Prospects
In recent months, the situation in Ukraine’s small and medium-sized enterprise (SME) sector has raised increasing concerns among business leaders and economic analysts.
The latest data reveals that over 40% of businesses rate their current conditions as unsatisfactory or poor, indicating a challenging period for the sector.
The Ukrainian Business Index (UBI), as of mid-2025, stands at 36.1 out of 100, reflecting a decline from 38.6 in March 2025 and 36.9 at the beginning of the year.
This downward trend signals worsening business sentiment and negative expectations for future growth.
A significant factor contributing to the deterioration is workforce reduction: approximately 33% of respondents reported downsizing their staff, while only 6% experienced an increase.
Consequently, many companies have reported a decrease in production volumes, with nearly half indicating a reduction, whereas about one-third maintained production at previous levels.
The financial and economic assessment remains cautiously pessimistic: only 16.8% of entrepreneurs describe their current condition as good or excellent, while 31.4% are satisfied, and over 41% characterize their situation as unsatisfactory or poor.
Revenue forecasts also show a downward trend, with most businesses expecting their income to decline by less than 10% by the end of 2025 compared to 2024.
Their results for the first half of 2025 are relatively stable, reaching 98.2% of the previous year’s value, suggesting cautious optimism but overall subdued growth.
These data indicate that Ukrainian SMEs are facing significant economic challenges, and recovery will require comprehensive efforts, policy support, and stabilization of the broader economic environment.