Ukrainian businesses face collapse amid military conscription crisis
Approximately 800,000 men in Ukraine have gone "underground" to avoid military conscription. They have changed their addresses, and their salaries are paid in cash. The military is increasingly conducting workplace raids to catch these "evaders." The situation may reach a critical point by late September.
Amid ongoing mobilization, Dmytro Natalukha, the chairman of the parliamentary committee on economic issues, told the "Financial Times" that since the start of the full-scale war, companies have lost an average of 10-20 percent of their workforce due to military drafts or emigration. "A renewed Russian offensive this year, which has resulted in more deaths and destruction, as well as power cuts, could drive even more people to leave," he said.
Businesses vs. army
He added that more and more businesses in Ukraine will be shutting down due to a lack of resources and people. This will hurt the economy.
I don’t want to be apocalyptic, but I would say the deadline is late September," he warns.
Russians are attacking medics on the front line. "This is a ruthless conflict"
The MP emphasized that you can mobilize 1 million people, but it doesn't make sense if you don't have the resources to arm them. In the case of an economic collapse, the army will be defenseless, as he conveyed. Ukraine recently adopted a bill that gives entrepreneurs a choice: either they pay the government 20,000 hryvnias (about CAD 680) to keep an employee at their job, or they are drafted to the front.
This is expected to yield a monthly profit of about 200 million hryvnias (about CAD 6.7 million). What if the company has no money? It can provide services to the army for free or donate essential equipment and materials, such as construction materials.
"That’s money that doesn’t depend on which mood Viktor Orbán wakes up in or who becomes the next president of the US," explained Natalukh, referring to repeated delays in EU aid mediated by the Hungarian prime minister.
However, such a proposal arouses many controversies and criticisms, especially given the soldier shortages on the front. At the same time, a recruiting system based on finances seems unfair.
Hiding from the draft
According to Natalukh, approximately 800,000 men have gone "underground" to avoid the military, changed their addresses, and receive their salaries in cash. This leads to officers from the TCR (Territorial Recruitment Centre) increasingly targeting companies where employees are physically present.
"People need to understand that in times of war and economic crisis, difficult, unpopular decisions cannot be avoided," emphasized Monobank co-founder and CEO Oleg Horokhovski.
He noted that amid the war of attrition imposed by the Russian Federation, in which the aggressor's resources exceed those of the Ukrainians, "it's not about fairness, but about effectiveness." As the businessman explains, a highly skilled programmer at a bank or in the online market is more valuable on the home front of Ukraine than if sent to the front line.
Natalukh added, "You cannot win the war with mere fairness. War is unfair per se."
