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Misha Migdal: Global trade during the pandemic

21.04.2020

UCCI Representative in the USA (East Coast), Misha Migdal

GLOBAL TRADE IN A STATE OF PANDEMIC: HOW UKRAINIAN EXPORTERS
SHOULD CONTINUE TO PURSUE THE U.S. MARKET
The US government has promptly reacted to the challenges related to Covid-19 with the
goal to stabilize the economic and financial situation, as well as in support of trade policy. The
United States presents and always will a wealth of opportunities for Ukrainians looking to
export. It is the richest market in the world, and for Ukrainian entrepreneurs it represents a real
opportunity for business growth and development.

Some statistics:
In 2019, the product turnover between Ukraine and the USA was 4.263 USD million.
Export of Ukrainian products to the USA in 2019 comprised 978,9 USD million.
Main groups of goods exporting to the USA:
- steel and metals (53,2% from total export);
- products from steel and metals (16,2%);
- products of vegetables processing (3,6%);
- electric cars (2,6%);
- fats and oils of animal or vegetable origin (2,5%).
Metallurgical products comprise 70% of Ukrainian export to the USA, agricultural sector
products and food industry come to 9%.

What does the Ukrainian exporter need to do in reality in order to eventually conquer the US
market?

1. Clearly understand the goal of your product to enter the US market
In its turn, entering the US market provides many benefits. Ukrainian exporters should do
research on whether their product is fitting for the market and if they could offer competitive
prices. Many producers go to the US market because it is prestigious or because it opens the door
to new technologies.

2. Have a competitive product or service
It is important to find your niche. It is not as important whether you are a big corporation or
represent a small or medium-sized business. By focusing on your niche, you will find your way
to enter the US market. In terms of business directions, the IT-sphere, power engineering,
agriculture, engineering, aerospace and high tech are most sought after. More recently, the textile
industry, shoes, furniture and sports inventory have emerged.

3. Find reliable partners
You are going to need partners. A US-based distributor who specializes in your field is one
such partner. Your importer or freight company will probably be based in Ukraine. Some firms
employ agents to attend trade shows in the US, meet customers and to promote them in general.

4. Be very flexible and patient
Another important obstacle for business is different standards. If you sell your products to the
EU, it doesn’t mean that they will automatically find their way to the US market. First, they have
to pass standardization in the US. This is only if you want to sell your products under your own
trademark. It is easier to export raw materials. Your products will then be branded under
American trademarks.

5. Understand your supply chain
Duties will be added when your goods get from A to B. You need to understand what
regulations apply and how much your product will cost once it arrives in the US. It is also
important to remember that the US is a federal country. State laws may differ considerably,
particularly if you are importing goods containing alcohol.
Good luck and only forward!