s Anna Derevyanko, who heads the European Business Association (EBA) in Ukraine, looks over her nation, she is the first to acknowledge the challenges of operating in an ancient country that entered the Soviet world and later came out a young nation building a new economic framework.

But she is also enthusiastic about the country’s prospects, and says this is the time to become engaged here.

Particularly encouraging is that within a relatively short time frame – the national elections completed in February, with local elections the end of October – the new administration has announced reform plans in important arenas, including overhauling the tax code.

Announcements of government reforms underway are not unique, but Derevyanko observes that “this time there has been a great intensification of communication with the business community; the exchange of ideas and feedback takes place on a daily basis.”

Not only does this bode well for designing the most helpful reforms to lower barriers to business, but Derevyanko sees this communication as vital to assist in the all-important task of proper implementation of reforms. “We will be closely engaged throughout the implementation process.” Across the EBA, membership has tremendous expertise that the government can draw upon.

“We have been measuring the mood of investors, both Ukrainian and foreign, by means of our Index of Investment Attractiveness,” says Derevyanko.

“In their collective analysis across a broad range of areas, throughout the first three quarters of 2010, there’ve been major improvements over 2009. Our member companies perceive improvements in political stability and in the relative predictability of political decisions. Another issue that has changed for the better is VAT refunds connected with the issuance of VAT bonds. We are also very pleased to note the government’s cooperation with the IMF.” The index can be found on the EBA website, www.eba.com.ua.

Beyond working with Ukraine’s government, the EBA also advocates member interests throughout foreign and international
organizations, and provides feedback that influences the making of policy in the EU that impacts Ukraine.
The EBA is tasked with infusing European business practices and values. Derevyanko focuses on “reducing barriers to investment, promoting negotiations between the EU and Ukraine and promoting Ukrainian businesses.”

With 800 members, the EBA is the biggest association of foreign businesses operating in Ukraine. Its main office is in Kyiv, with operating branches in six other regions. Operations recently began in Brussels.

For businesses seeking involvement in Ukraine, the group offers a broad array of reports from its many committees and working groups, and many networking avenues. “Foreign investors need not stand alone in our market, cooperation is the key to success,” says Derevyanko.

Derevyanko notes that many companies are navigating the challenges and gaining a high rate of return. Companies such as Kraft, Unilever, Philips, Siemens and many other established players continue to form an economic bedrock.

She sees tremendous opportunities opening up for the tourism industry, as well as in agriculture and IT, and in the creation of all manner of infrastructure. “The financial crisis slowed things down for many, particularly with the lower demand for steel, but in other areas, it was an opportunity to increase market share, and the economy is now coming back.”

“Be prepared when you enter this market,” says Derevyanko. “Analyze the laws, the bylaws, the framework of implementation. Put together a team of good people, of lawyers and accountants, and pay close attention to picking the right partners.

“Set up your relationships with government, seek its feedback on how it views your company. Communicate closely with agencies charged in helping you. Be skillful in integrating an inexpensive but very qualified labor force. If you properly prepare, you can reap returns that exceed those in most of the world.”