Ukraine Recovery Conference — the problems of monopolies

Prices for construction materials in Ukraine have surged by 30–70 percent since the full-scale invasion.

Cement, which accounts for up to 40 percent of construction input costs, has had one of the steepest hikes.

This inflation cannot be attributed solely to increased energy costs, the cost of doing business in wartime, or currency depreciation. It coincides with years of rising market concentration, which has fostered an anti-competitive practice that must be stopped. 

The European Union has committed up to €50bn to Ukraine’s reconstruction between 2024 and 2027 through the Ukraine Facility. This is the most ambitious reconstruction project since the Marshall Plan.

In strategic sectors like cement, monopolisation is quietly driving up prices, choking competition, and undermining the principles the EU claims to support.

The Ukrainian private sector is taking the matter into its own hands and fighting back against a recent merger in the cement sector. The fight, which will now be decided at the Supreme Court, should also concern EU and member state officials interested in the successful reconstruction of Ukraine. The outcomes will be critical to Ukraine’s EU accession prospects.  

In September 2024, CRH, a Dublin-based, US-listed conglomerate with a history of market abuse, agreed to acquire the Ukrainian assets of Buzzi Unicem, an Italian cement company.

CRH now controls 46 percent of Ukraine’s cement market. Together with CemIn West, these two companies form a de facto duopoly with over 90 percent of the market share.

In 12 Ukrainian regions, CRH’s dominance now ranges from 50 percent to a staggering 99 percent.

Cement and security

Cement is not just a construction material; it is a wartime necessity.

It is used to build trenches, bunkers, fortifications and other critical frontline infrastructure. As market power consolidates, prices increase, supply chains face bottlenecks, and producers gain the ability to delay or withhold material with limited accountability, which threatens Ukraine’s security. This also directly strains the EU's ability to effectively support Ukraine as it holds the frontline against Russian aggression at Europe’s doorstep.

After the war, demand for cement will only increase.

"This is not just about cement. It’s about whether Ukraine's reconstruction will be an example of open, competitive, democratic recovery, or a missed opportunity corrupted by corporate power and weak institutions."

Analysts estimate that 35 million tonnes of cement will be required to rebuild Ukraine’s infrastructure. The Kyiv School of Economics places the cost of building materials alone at over $65bn (€60bn).

There's no question that this sector offers attractive investment prospects, and international interest is welcome. Its clearly essential to maintain fair market conditions to keep reconstruction affordable. This is particularly pertinent to the EU, which has pledged to foot its share of the reconstruction costs. 

A political test for the EU

Ukraine has committed to aligning its competition framework with EU law as part of its accession path. But the Antimonopoly Committee of Ukraine (AMCU), the body responsible for safeguarding fair competition, has consistently failed to act or respond to warnings.

For example, there is the saga of TEDIS Ukraine.

This is where the AMCU first permitted a series of acquisitions of tobacco wholesale firms by TEDIS, which, with market exits by smaller operators, led to a situation by which it obtained a virtual monopoly.

Between 2013-2015 it obtained a market share of around 99 percent, of cigarette distribution nationally.

Only at that point did the AMCU open an investigation, which ultimately failed following a withering judgment in the Supreme Court in 2021.

In the pharmaceutical sector, BaDM and Optima form a duopoly controlling over 85 percent of wholesale distribution. This anti-competitive market structure has been linked to medicine shortages and inflated prices.

Despite over a decade of public frustration, the AMCU finally only opened a formal investigation this year.

There are growing concerns in Ukraine about the competence and integrity of the organisation. Pavlo Kyrylenko, AMCU’s chairman, is now personally under investigation for illicit enrichment totalling nearly 73 million hryvnia (€1.5m) but remains in office.

For Brussels, all of this should ring alarm bells.

A weak, compromised competition authority will be unable to uphold the legal and economic standards expected of EU candidate countries. The EU must work with Kyiv to support the AMCU in cleaning up its act. 

It is a simple economic truth that excessive market concentration raises prices. Infrastructure projects will cost more. Small and mid-sized firms will be squeezed out or blocked from entry. Delays and inefficiencies will strain local budgets. International partnerships will be harder to secure. In the end, EU taxpayers will foot the bill as inflated margins and profiteering absorb the EU’s investment.

This is not just about cement. It’s about whether Ukraine's reconstruction will be an example of open, competitive, democratic recovery, or a missed opportunity corrupted by corporate power and weak institutions.

The EU has leverage. It must use it to demand reforms, strengthen institutions like the AMCU, and condition future funding on transparency and enforcement. 

Rebuilding Ukraine is about more than bricks and mortar; it is about fortifying the foundations of a reformed economy. The integrity of Ukraine’s recovery and the credibility of the EU’s vision will be judged. A fair market landscape must come first because victory and an economically strong democratic Ukraine will not be possible without it.

This year, we turn 25 and are looking for 2,500 new supporting members to take their stake in EU democracy. A functioning EU relies on a well-informed public – you.