This expansion marks the first formal implementation of the application review process, allowing Ukrainian manufacturers of 25 types of products to be included under the localization policy. The initiative is designed to stimulate domestic production, increase added value within the country, and reduce dependence on foreign suppliers in strategic sectors.
What Products Will Be Affected
The proposed expansion includes a diverse range of goods and industries, with a focus on:
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Mechanical engineering (elevators, tractors, and related machinery)
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Light industry (workwear, military uniforms)
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Electrical products (lighting devices, cables, traffic lights)
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Metal structures and large-diameter pipes
These additions are expected to significantly increase procurement opportunities for Ukrainian businesses.
Background on Ukraine’s Localization Policy
Since July 2022, Ukraine has enforced amendments to its Law on Public Procurement, introducing a gradual localization requirement that raises the share of Ukrainian components in publicly procured goods from 10% to 40% over a ten-year period. The minimum localization level in 2025 is set at 25%.
Currently, the policy covers 103 types of products across four sectors of mechanical engineering. Importantly, localization requirements do not apply to suppliers from countries that are parties to the WTO Agreement on Government Procurement (GPA).
Why It Matters
This policy not only encourages industrial growth and job creation in Ukraine but also aligns with broader efforts to ensure economic resilience and import substitution during wartime. Expanding the localization list could also support defense production, infrastructure development, and broader recovery efforts.
The Ministry of Economy plans to review and approve applications from eligible manufacturers in the coming months, with official changes to the list expected later in 2025.
