Ukraine’s first export-oriented food-cluster industrial park has opened in Novovolynsk, in the Volyn region. The founders of NOVO Industrial Park, joined by Ukraine’s Minister of Economy and the city’s leadership, buried a 25-year time capsule containing a message to future generations and announced the park’s first prospective residents.
Preliminary agreements have been reached with businesses working in fish processing, food manufacturing and logistics.
“Ukraine’s GDP could grow by 10% if 100 industrial parks were operating,” said Yuliia Svyrydenko, who was serving as First Deputy Prime Minister and Minister of Economy at the time.
The original project announcement notes that qualifying industrial park residents may benefit from import VAT and customs-duty relief on new equipment, a ten-year corporate income tax exemption for eligible activities, and preferential local property and land tax rates.
“During the war, industrial parks can become engines of growth for Ukraine’s economy. Statutory incentives can allow a company to build a factory while saving roughly a quarter of the investment it would otherwise need,” said Oleksandr Bondarenko, Head of the park’s management company, the Bureau of Investment Programs.
“Depending on the industry, a mid-sized factory employing 100–150 people might cost around $8 million to build in Ukraine, compared with approximately $10 million in countries such as Poland or the Czech Republic. Locating production in a Ukrainian industrial park could bring that investment down to about $6 million. Developing industrial parks therefore helps revive Ukrainian industry and gives businesses more reason to remain in Ukraine rather than relocate to the EU.”
Taking available incentives into account, a business operating in an industrial park could achieve payback in four to five years, depending on its sector, business model, competitive position and initial investment. Novovolynsk’s proximity to Poland also places resident companies within easy reach of European export markets.