U.S. Ambassador Geoffrey Pyatt’s Remarks at the Lviv Women Entrepreneurs Workshop
23 May, Lviv Business School
I’m also pleased to be at an event that brings together businesses from eastern and western Ukraine. You all have a lot to share and learn from one another, and when you understand each other’s challenges and successes, it helps cement Ukrainian unity.
The last time I spoke at a similar event in Dnipropetrovsk last November – a workshop some of you were also at — was a day I will never forget. My remarks at the time focused on Ukraine’s European future and the extraordinary potential for economic integration and growth under the EU Association Agreement. I highlighted how women entrepreneurs were an important engine for the economic growth Ukraine needed.
And then, that afternoon, the government announced to everyone’s shock that he was suspending talks for signing the agreement. By the time I landed back in a very rainy Kyiv that night, there were people with signs on the Maidan protesting against that decision, demanding that Ukraine stay on the path to European integration.
The rest is history, and I don’t need to tell you how much things have changed.
A determined and peaceful civil society helped bring about a revolution, not just by bringing the departure of a corrupt President, but by fundamentally changing the way in which Ukrainians think and talk about government and society.
This was as much about changing the country as it was about changing the president. I’ve watched how public discussions have evolved, boldly demanding that rule of law and dignity and respect for human rights become everyday values now.
I know the important role that Ukrainian Catholic University and its students played in this revolution of dignity, as well as the thousands of others who contributed in big and small ways. And some made the ultimate sacrifice, giving their lives for the future of Ukraine.
And yet despite the revolution and all the changes, the message I delivered in November remains even more relevant today: entrepreneurs are the driving force in any economy, and women have been underrepresented and underutilized in Ukraine’s economic growth.
And with a government focused on reform and fighting corruption, the environment for small businesses is getting better each day.
With that in mind, I would like to make three main points about why events like today are so crucial for economic growth.
[1] First, in Europe today, almost 60 percent of the economy is comprised of small and medium enterprises. In Poland, it’s 50 percent. But in Ukraine, it’s only 17 percent. Four times less than elsewhere Europe! That tells me there is a sector of the economy with untapped potential. One that needs to be developed by people like you.
For every big manufacturing enterprise, you need dozens of smaller businesses, ranging from those providing parts and services for the big guys, to those providing goods and services to the general population. I encourage you all to be ambitious and identify those niches where your ideas could become real businesses.
Let me add that I understand how hard it has been to do business in Ukraine. I know that starting off with a good idea and a business model in Ukraine is not enough. You face obstacles with license and permits, with tax inspections, and fire inspections and more bureaucracy than in other places. But I am heartened when I see efforts by government and business associations to eliminate those barriers.
The Maidan revolution was about bringing rule of law and higher standards to government, and you as business owners can help carry forward that vision by pushing your government to reform and simplify and make it easier to build a business.
[2] My second issue is the status of women entrepreneurs. Sometimes people ask whether it’s necessary to talk separately to women entrepreneurs. Why not talk to all entrepreneurs? But women tell us there is still a great need in Ukraine to encourage and empower women in business. Officially, women make up 50 percent of the work force, but 55 percent of Ukraine’s unemployed are women.
Only 12 percent of large companies are headed by women, and 15 percent of medium-sized companies. Women’s salaries in Ukraine don’t yet match men’s: men earn on average 22 percent more than women. All that tells me there is still room for figuring out how to develop Ukraine’s female entrepreneurial talent.
This is a global issue. Many studies ranging from the World Bank to the World Economic Forum have demonstrated that investing in women brings high yield. It is a fact that women-run small and medium enterprises drive economic growth and create jobs. It’s true in the United States, and it’s true in Ukraine. Helping women in business is smart economic policy.
[3] Lastly, Ukraine’s economic future. When I was in Dnipropetrovsk last November, I was trying to explain the benefits of the Association Agreement with the EU. Today, I don’t need to tell people living just a few kilometers from Poland how useful it is to have a free trade agreement with the EU. But there are many small and large businesses in the east that don’t have that proximity, and don’t fully understand the benefits.
Their trade ties have been traditionally with the other neighbor, Russia. And for some businesses it seems like an either/or argument – either the EU OR Russia. Russia has played on those fears and made it clear that it thinks it should determine Ukraine’s economic choices.
But it’s not a choice of one or the other. Ukraine can have both, and should work towards both. Ukraine’s geography is not going change – it will always be a bridge between Russia and Europe – and that should be a tremendous advantage in the long term for everyone.
In conclusion, let me wish you a productive second day, one of ideas and energy and building networks and Ukraine’s future.
Slava Ukraini!
