Current Dynamics and Obstacles Facing Small and Medium-Sized Businesses in Ukraine Amidst the War

Abstract

Introduction: This study’s relevance is driven by the need to develop scientifically sound economic instruments to create a favourable business environment that will help restore and increase the resilience of small and medium-sized businesses in Ukraine during the war and post-war reconstruction.

Objectives: This research article aims to analyse the economic instruments for supporting small and medium-sized businesses in Ukraine during the war and post-war periods by analysing the current barriers to their functioning, assessing the status and main factors affecting the productivity of SMEs, and formulating ways to improve efficiency, optimise processes and recover from the war.

Methods: The study used methods of information synthesis, statistical method, forecasting method, correlation analysis, and method of generalisation and systematisation, which allowed for a comprehensive analysis of current problems and barriers to the functioning of small and medium-sized businesses, identification of key trends, and substantiation of the prospects for the development of this sector in the context of the war and post-war recovery of Ukraine.

Results: The correlation analysis revealed a correlation between the sales volumes of medium-sized enterprises, the innovation index (r = 0.587), and the business confidence index (r = 0.667). However, the lack of statistical significance (p > 0.05) indicates the need for innovative development and increased investment in technology. At the same time, the correlation between small business sales and the business confidence index (r = 0.806 at p = 0.05) shows the importance of ensuring a stable external environment for SMEs. In turn, micro-enterprises also demonstrate a high correlation with business confidence (r = 0.912 at p = 0.016), emphasising the dependence of their functioning on economic stability.

Conclusions: The results of the study indicate the need to reduce regulatory pressure, eliminate corruption and bureaucracy, expand financing programmes and create a mechanism for preserving human resources to ensure the prompt recovery of the SME sector both during the war and post-war periods, as well as to ensure sustainable economic growth by creating favourable conditions for economic activity and stimulating the development of critical sectors of the economy.