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The economy of Ukraine is an emerging market, with a gross domestic product that has experienced double-digit growth in recent years. Formely a major component of the economy of the Soviet Union (both in industry and agriculture), Ukraine"s economy experienced major fluctuations during 1990s, including hyperinflation and drastic falls in economic output.
Ukraine has many of the component of a major European economy - rich farmlands, a well-developed industrial base, highly trained labour, and a good education system. At present, however, the economy remains in condition for best developing. While Ukraine registered positive economic growth starting from 2000, this came on the heels of eight straight years of sharp economic decline. As a result, the standarts of living for most citizens has declined more then 50 % since the early 1990s, leading to a relatively high poverty rates. The macri economy is stable, with the hyperinflation of earlier in the decade having been tamed. Currency of Ukraine, hryvnia (UHA), was introduced in September 1996, ande has remainded fairly stable. The economy started growing in 2000, and growth has continued and has dot remarkable 12% in 20004, despite a loss of momentum in needed economic reforms.
Ukraine Ukraine is relatively rich in natural resources, particularly mineral deposits. Although Petroleum oil reserves in the country are largely exhausted, it has other important energy sources, such as coal, natural gas, hydroelectricity and nuclear fuel raw materials.
Ukraine has a major ferrous metal industry, producting cast iron, steel and pipes. As jf 2005, Ukraine was the world"s Steel production by country seventh largest steel producer. Anather important branch is country"s chemical industry producing Coke (fuel) coke, mineral fertilizers and sulphuric acid. Manufactured goods include metallurgical equipment, diesel locomotives, tractors, automibiles, ships, aircrafts, vehicles and buses. The country possesses a massive high-tech industrial base, including much of the former Soviet Union electronics industry, arms industry and space program, nuclear power industry. However, these fields are state-owened and underdeveloped in terms of business management.
Agriculture.
Ukraine is a major producer of grain, sugar, meat and milk products.
In agriculture Ukraine possesses the most enormous potential. It owns the third part of world black earths, has favorable climatic terms. The traditional products of agriculture of Ukraine are corn cultures, sugar beet, products of husbandry, products of plant-growing, fruit, oil-bearing cultures and others. Ukraine is one of the largest exporters of corn.
Disintegration of the USSR was inflicted by a large damage for this industry. In 2007 the level of production attained only 67% from a level of 1990. The annual gross product of this industry makes up to 16 billion US dollars, depending on the productivity of year. Main reason of happening collapse of production is the unfinished state of the conducted reforms in the land funds legislation. It entails absence of necessary volumes of investments in this industry. The necessary volume of investments is certain the specialists of agency of USAID of the USA in 8-10 billion of US dollars. However, Ukraine comes into the intent notice of foreign investors for the purpose investments in this industry of economy. Presently the market of earth of the agricultural setting in Ukraine is not present. Long lease of 49 years is available.
Ukraine encourages foreign trade and investment. The parliament has approved a foreign investment law permitting Western businessmen to purchase businesses and property, to repatriate revenue and profits, and to receive compensation if the property in case of nationalization by a future government.
Most of Ukrainian trade is conducted with Russia and the European Union. An overcrowded world steel market threatens prospects for Ukraine"s principal exports of non-agricultural goods such as ferrous metals and other steel products. Although exports of machinery and machine tools are on the rise, it is not clear if the rate of increase is large enough to make up for probable declines in steel exports, which today account for 46% of the country"s overall exports.
Ukraine imports 90% of its oil and the majority of its natural gas. Russia the largest and principal of the Ukrainian supplier of oil, and Russian firms now own and/or operate the majority of Ukraine"s refining capacity. Natural gas is supplied from Russia as export - which delivers its own gas,
as well as the gas from Turkmenistan. Instead, Ukraine is transporting Russian gas to EU through its well-developed gas pipelines system, being the Europe"s vitally important gas transitor. Country"s dependence on Russian gas supplies dramatically affects on its economics and foreign policy, especially after the Russia-Ukraine gas dispute which happened last year. However, Ukraine is independent in its electricity supply, moreover, exporting it to both Russia and Europe. It has been achieved due to a wide use of atomic energy and hydroelectricity. The recent energy strategy intends gradual decreasing of gas- and oil-based generation in favour of nuclear power, as well as energy saving measures, shortening of industrial gas consuming. Reform of the still inefficient and opaque energy sector is a major objective of the International Monetary Fund (IMF) and World Bank programs with Ukraine.
Ukraine has a row of large marine ports. On the coast of the Black sea there are ports in cities Odessa, Ilyichivsk, Kerch, Sebastopol, Kherson, Mykolayiv, Berdyansk and Mariupol.
In 1992, Ukraine became a member of the IMF and the World Bank. It is a member of the European Bank of Reconstruction and Development but not a member of the General Agreement on Tariffs and Trade/WTO|World Trade Organization. While Ukraine applied for WTO membership, its accession process was stalled for several years. In 2001, the government took steps to reinvigorate the process; however, there was less concrete progress in 2002. The WTO Working Party on Ukraine met in June 2002. The goverment"s stated goal is to accede to the WTO by the end of 2006- February 2007. Currently, the only country yet blocking Ukraine"s entry to the WTO is Kyrgyzstan.
A political crisis in the middle of 2006 was feared as a threat to economic and investment stability, however, despite the forecasts, the political situation has not scared the investors. The GDP has shown a good growth rate of 9% in July 2006, compared to July 2005. Industrial output has increased.
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Serg_Turovets
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