SMALL AND MEDIUM BUSINESSES IN UKRAINE: STATUS, TRENDS, AND CHALLENGES DURING MARTIAL LAW

Abstract

The article examines the current state and fundamental principles of the operation of small and medium-sized enterprises (SMEs) in Ukraine during the period of 2022-2024. The main trends have been identified, and main issues affecting business processes have been outlined. The significance of small and medium-sized enterprises in the national economy, their response to social processes, and their contribution to social stability have been analyzed. The regulatory framework governing business segmentation by categories, including the Commercial Code and the Law of Ukraine «Оn Accounting and Financial Reporting», has been studied. A brief overview of the situation in the domestic economy is provided, which has resulted from the prolonged military conflict that began in 2014 with the start of the Anti-Terrorist Operation (ATO) and continues with the introduction of martial law. The processes that can help overcome the consequences of the prolonged recession are discussed. It has been found that stimulating the development of small and medium-sized businesses is a necessary condition for the reconstruction of the country during and after the war. Small and medium-sized enterprises (SMEs) play a very important role in maintaining the economic stability of any country, especially during times of crisis. In Ukraine, enterprises that belong to medium, small and micro-businesses (SMEs) have always been an important source of jobs and innovation, as well as the basis for the development of the local economy. However, with the introduction of martial law in the country, this sector of the economy faced unprecedented challenges that significantly complicated its functioning and development. The war has led to significant changes in the business environment of Ukraine, which has significantly affected the situation of SMEs. Some companies were forced to cease operations, some were destroyed or lost access to important markets and suppliers. The biggest challenges for entrepreneurs were the destruction of infrastructure, the long process of continuous mobilization, which caused a shortage of workers, a decrease in the solvency of the population, and logistical problems. In such conditions, small and medium-sized businesses have to not only adapt to new realities, but also take into account many aspects, one of which is the difficulty of obtaining support from the state and its financial institutions, as well as the complicated booking process.