The war in Ukraine has meant a massive change for thousands of companies, compelling many to overhaul their business, transfer their operations and production lines, and become more agile in the face of emerging challenges. Throughout this upheaval, the United Nations Industrial Development Organization (UNIDO) has been able to leverage its long history of collaboration with companies in the country to adapt its operations and provide support in response to the deteriorating situation.

As one example, UNIDO and the Resource Efficient and Cleaner Production (RECP) Centre in Kyiv have been working together under the EU4Environment Action programme to help the country preserve its natural capital and unlock opportunities for green recovery and growth. This programme is funded by the European Union and implemented by a consortium of partners, including the Organisation for Economic Co-operation and Development (OECD), the United Nations Economic Commission for Europe (UNECE), the United Nations Environment Programme (UNEP), UNIDO and the World Bank.

Stopping climate breakdown and recovering from the adverse environmental impacts of the ongoing war are directly linked to curbing the inefficient use of natural resources. This issue is especially critical in the industrial sector, where the high costs related to resource depletion have only increased the burden on small and medium-sized enterprises.

The introduction of RECP has been a central task for UNIDO’s work in Ukraine since 2007, when the Amalgamated Territorial Communities of Slavuta in the Khmelnytskyi Oblast and Davydiv in Lviv Oblast were selected to undergo industrial waste mapping exercises. In 2023, responding to the grave new challenges faced by the private sector in Ukraine and drawing on the stakeholder network established within the programme, UNIDO conducted a survey of relocated companies to understand their most pressing needs and inform response actions. The survey revealed that the companies were in need of significant financial, equipment and knowledge support to be able to rebuild their operations; and that many of the companies also were willing to rebuild with a greater focus on sustainability and circularity.

Clean energy for a pet food manufacturer

Such was the case of Suziria, a pet food manufacturer from the Kharkiv Oblast. After their relocation to the Ivano-Frankivsk Oblast, UNIDO was able to analyze their production methods to facilitate the development of their capacities and efficiencies. A critical challenge the company has been facing are recurrent power disruptions in the manufacturing process – a problem not easily addressed by traditional energy sources such as coal or natural gas. As a solution, UNIDO plans to facilitate the installation of an autonomous solar power plant to ensure an uninterrupted supply of clean energy for their production lines.

This targeted intervention was feasible due to the extensive knowledge and expertise that UNIDO has developed in clean energy solutions for industry, as well as a long history of close, on-the-ground work in Ukraine. Further, the strong support of partners like the European Union and Team Europe has enabled UNIDO to effectively meet the varied needs of industry, regardless of the challenges they face.

Reconstructing a heating system and energy supply autonomy to rebuild production

From the challenge of launching a business during the COVID-19 pandemic to the sudden cessation of operations and relocation as a result of the war, the Cryza Store clothing firm has certainly lived up to its name (криза in Ukrainian means “crisis” in English). This Ukrainian fashion design and production house had to address several of the common challenges identified by UNIDO for relocated businesses: determining the most suitable production location, identifying new suppliers and securing a qualified workforce.

To provide better support, UNIDO is partnering with the Government of Ukraine to assist companies in addressing these challenges with a focus on ensuring that relocation results in enhanced sustainability, efficiency and resiliency. For Cryza Store, UNIDO provided guidance on the reconstruction of a heating system and the achievement of energy supply autonomy in the process of rebuilding their production.

All told, UNIDO, in collaboration with the RECP Centre in Ukraine, has offered support and consulting to 15 companies of different sizes that have been forced to relocate operations. This experience has demonstrated first-hand that efficiency, environmental sustainability, and resiliency are essential for ensuring a strong recovery from the consequences of the war.

Looking forward, UNIDO will continue to work on circular economy issues through the preparation of an online training course for civil servants and officials at different levels of government in the country, as well as an exploratory foresight study to support developing a circular economy roadmap for Ukraine.

See: Towards a Green Economy with EU4Environment in Ukraine