Most of Western Europe is struggling with economic stagnation induced by a contracting manufacturing sector.

By looking further east to the Ukraine you will find a economy not so heavily reliant of capital intensive manufacturing but one being propelled forward by talent in the technology sector.

Ukraine’s economy grew at 4.1% year-on-year to the third quarter 2019 while its unemployment rate dropped to 7.3%, a five year low.

The entrepreneurial spirit pushing the economy was evident from meetings we had at Web Summit with a number of entrepreneurs and organisations promoting the nation’s tech sector.

We met with representatives of Unit City, a tech village based in Kiev that provides training to young developers and encourages them to remain in Ukraine, as opposed to join tech giants in Silicon Valley.

As well of providing facilities for developers, Unit City is home of over 100+ Ukrainian start ups and is representative of the innovation and technology sector helping economic growth in Ukraine.

It is not just private enterprise promoting the technology sector, in late 2019 the Ukrainian Prime Minister launched the IT Creative Fund to help train aspiring IT students.

With this emphasis on education, and to keep home grown talent at home, Ukraine is setting themselves up for significant economic expansion.

iShares JP Morgan Emerging Markets Bond ETF

To gain diversified exposure to growth in Ukraine we look to iShares JP Morgan Emerging Markets Bond ETF.

This is a very unexciting method of taking exposure in Ukraine but the equity markets are not yet developed enough for fund managers to include in a meaningful manner with most Eastern Europe mandated funds dominated by Russian equities.

For example, the equity focussed iShares MSCI Eastern Europe doesn’t have any direct holdings in Ukraine.

Given the sparse inclusion in funds, one also look to companies expanding operation into Ukraine such as Mondelez.