Financial sector news

The Verkhovna Rada Committee on Economic Development, under the leadership of Committee Chairman Dmytro Natalukha, has developed proposals for economic reservation that could become a lifeline for Ukrainian business during the war. This was reported by the website  reported by the website of the Verkhovna Rada of Ukraine.

These initiatives will allow employers to identify strategically important employees on their own, paying UAH 20,000 of military duty per month for them, which will allow businesses to continue operating and pay the taxes necessary to support the Defense and Security Forces.

“Ukrainian businesses still need reservations because they have to work,” noted Dmytro Natalukha. “If there is no business with its taxes, there will be nothing to support our defenders. This may be an unpleasant but obvious truth for some. But, once again, let the business decide for itself which of its employees is strategic. Only business is the main source of taxes and economic development in Ukraine. Whether someone wants it or not. The way through government resolutions is morally and technically outdated. Strategic should be not so much the industries defined by officials, but rather the specific employees defined by the employer. Economic reservation is a new mechanism for effective interaction between business and the state. And it is about preserving the economy.”

Along with economic reservation, the Subcommittee on State-Business Interaction and Investment, chaired by Ihor Marchuk, offers a partial alternative in the form of economic mobilization. This approach is aimed at saving state budget funds and allocating them for additional financing of the Defense Forces.
“Economic mobilization is when, through the mechanism of military service, businesses use their resources to provide the necessary services and perform work in areas where businesses have greater competence and efficiency than the military. Examples include procurement, logistics, procurement management, medical services, equipment repair, IT, fortification construction, consumer services, office management, HR, etc. The military personnel released as a result can perform other, more important and specific tasks,” explains Ihor Marchuk.

Marchuk emphasized the importance of realizing that the state has no funds of its own, and all the funds at the state's disposal are taxpayers' money. “The only source of these funds available to us is a working economy! If there is no economy, we will be left without taxes and the resources necessary to finance the army.”
Thus, the new initiatives on economic reservation and mobilization are aimed at preserving the vitality of business while providing financial support for the country's defense capability. These measures could be key to the stability of Ukraine's economy in wartime.

In March of this year, the Association of Ukrainian Banks hosted a meeting of representatives of the banking community with Dmytro Natalukha., MP, Chairman of the Verkhovna Rada Committee on Economic Development. During the meeting, the parties discussed topical issues of Ukraine's economic development under martial law. In particular, the meeting participants discussed the financing of the Armed Forces of Ukraine and the reservation of employees of financial institutions. The main focus was on a transparent mechanism for financing the Armed Forces of Ukraine and mobilization processes during a critical period for the country. The participants of the meeting considered the issue of booking key employees to ensure the stability of the economy and meet the needs of the Armed Forces of Ukraine.

Today, the Association of Ukrainian Banks is actively cooperating with the Verkhovna Rada Committee on Economic Development and other government agencies to improve the current legislation on reservation of employees of financial institutions that are critical for the functioning of the economy and ensuring the livelihoods of the population during a special period. In particular, the EBA held a series of official meetings of representatives of banks and non-bank financial institutions with representatives of the Verkhovna Rada Committee on Economic Development.

The participants of these events, including the majority of the Association's members, are in favor of finding a balanced solution that will meet the needs of the Ukrainian Defense Forces, both in human capital and in financing, as well as ensure the vital activity and development of the economy and the financial system.

The UBA advocates for the reservation of critical personnel - highly specialized workers who are difficult to replace in the context of mobilization. The UAB believes that today the issue of resources - both financial and human - is one of the key issues in the country and requires a comprehensive solution.