University of the People

BUS1103-01 – Microeconomics
Written Assignment
Unit 1
Russia’s war in Ukraine is devastating for the global economy, it caused a disastrous

humanitarian crisis: tens of thousands of lives lost, millions of people displaced, worldwide food

crisis, to name a few consequences. But the first people that are affected are those in Ukraine.

Apart from the loss of lives, the wide economic impact could be felt from the very start of the

invasion, and the consequences are growing day by day. Plenty of studies have been conducted

on the impact of the war on nationwide and global economies, but this paper will focus on how

entrepreneurs in Ukraine adapted to operating in the current circumstances.

The article “In a Time of Conflict, Ukraine Entrepreneurs Make War Their Business”

(https://www.nytimes.com/2022/07/11/business/ukraine-small-businesses-military.html) by

Erika Solomon published in the NY Times in July 2022 has caught my attention. The article

describes the change of direction some entrepreneurs took in their businesses to accommodate

the needs of the army, as well as to stay afloat in times of crisis and save jobs for the people. The

article features a few interviews with the small business owners in Ukraine, whose companies

requalifies themselves to help the army: a costume maker from Kyiv who started producing body

armor and helmets, a local fashion brand from Odesa sewing vests to fit armored plates, and

multiple companies in Lviv working on installing armor on existing vehicles and military

uniforms. “Many enterprises are working on a charitable basis to support Ukraine’s armed

forces. But increasingly, businesses are looking to establish for-profit models that they can

sustain throughout the conflict — and perhaps even once it ends, with an eye on export”

(Solomon, 2022).

The war has affected every household and business in Ukraine without exception. Whether you

are a refugee and your entire life has been uprooted, you are a volunteer who helps the army and

the refugees, you are a soldier in combat, no one is left untouched. Although I am not in the
country at the moment, my hometown, my life and my household have been affected by the

situation. As a frontline city (50 km from the active battlefield), we are the first ones to tend to

the wounded and accommodate refugees. My mum spent the first months of war cooking meals

for the local defense groups and hosting internally displaced people from the most war-torn

areas. Her partner, who is a heavy machinery mechanic, has lost most of his clients because

construction sites across the country, and specifically in our region were halted. He started

helping the army by repairing machinery and equipment on a voluntary basis. Evidently, our

household economy took a huge blow due to the lack of paid work and the necessity to help the

country in crucial times.

It is difficult to talk about what can be changed about the current microeconomic situation

because the war is still in its active phase and the situation is getting progressively worse.

Currently, every individual and the whole nation collectively are in survival mode. When the war

is over and we are rebuilding the country and the economy, only then the changes can be made. I

believe if the businesses which supported the army and helped the country in a variety of ways

are supported on a national level, it will give them a chance to recover and rebuild both the

business and the overall economy to be stronger and more stable. Of course, this will not happen

overnight but will take years and years to come to restore the economy.

The article was interesting to me because it touched on one of the most vulnerable topics for me.

It described the situation in my household precisely, and it showed that the biggest value for

Ukrainians in this situation is to help the country by any means they can.

The author relayed only a few stories, but they make a pretty good point, which I strongly agree

with: Ukrainians are resilient and, even in the face of war, they don’t give up easily. As I quoted
earlier in this essay, once the war is over the entrepreneurs are looking at the export of these

newfound skills and goods, which will help our economy immensely in the restoration phase.

References

Solomon, E. (2022, July 11). In a Time of Conflict, Ukraine Entrepreneurs Make War Their

Business. Retrieved from NY Times:

https://www.nytimes.com/2022/07/11/business/ukraine-small-businesses-military.html