The EU, the EEU, and the War in Ukraine: Political Risks and Management Options

Hannes Meissner / Johannes Leitner
international business administration. By doing so, we tried to ensure an intersubjective relativisation
in the interpretation, which contributed to a reliable result. In doing so, we used a deductive
approach, in that we had previously defined literary categories, but also took up categories
newly developed from the material (Mayring 2015).
4 Political risk constellation prior to 24 February 2022
We conducted the interviews only three months prior to the invasion of Russia in Ukraine. The
atmosphere among the business elite was already tense, but still, none of our interview partners
expected a full-scale war of the current dimension. The basic attitude was rather that “what
must not happen, cannot happen and thus will not happen”. The business representatives we
spoke to were aware that an open war between Russia and Ukraine would be the worst-case
political risk constellation, since this would be a direct and immediate threat to all their business
operations. As the country representative of an international business association emphasized,
all enterprises active in Ukraine have taken the decision to enter the market, despite the conflict
with Russia. As he further put it, the evaluation of the risk of further escalation to war is always
based on individual perceptions. The ones not ready to bear this risk did not come to Ukraine,
he emphasized. At the same time, the scenario of a war haunted the minds of some of our interview
partners. For example, the country representative of an international business association
concluded on his own that Russia would most likely not attack Ukraine from the East, what most
people would expect, but rather from the North via Chernobyl, since this is only one hour drive
from Kiev. Thus, Russian troops could be in Kiev in short time. If this scenario came true, businesses
based in Ukraine would not have enough time to prepare.
Against the backdrop of looming geopolitical risks of a war between Russia and Ukraine, interviewees
with a closer personal attachment to the country focused on the positive developments
and achievements of Ukraine. According to the representative of an international business association,
in the last years, Ukraine has attracted increasing FDI and has also achieved significant
progress in reducing corruption. This narrative had also been reiterated by the manager of a
consulting group active in the entire region. Ukraine has improved a lot when it comes to corruption,
the state bureaucracy works more efficiently, internal political risks are decreasing. As he
further stated, the IT industry is booming, salaries are on the rise and international investments
into the sector are growing significantly. A similar scenario was mentioned by the manager of
an international insurance company who said that despite all political risks, their business in
Ukraine develops very favourably. All three interview partners contrasted this positive picture of
Ukraine with the developments in Russia.
The extent to which this positive picture corresponded to reality was difficult to assess. It is worth
mentioning that in terms of political risk country levels, the literature analysing Ukraine since the
Maidan revolution, speaks rather a different language. In fact, there is a common understanding
that initial hopes for far reaching structural reforms were all not met. None of the post-Maidan
12 Wirtschaft und Management · Band 33 · März 2023