Ukraine. National building and history

NATIONAL BUILDING AND HISTORY

On the map of the world appeared independent state withy a thousand-year-old history – Ukraine. The new sate has an aim of constructing a democratic society primary through developing a market economy. To have an idea of Ukraine’s economic potential, her resources, and define the scale of reforms which have to be carried out, let us get acquainted with some objective data. Ukraine is situated in the geographical center of Europe. The country occupies a territory of 604 thousand square kilometers. Ukraine’s population is 53 million.

Ukraine declared its independence of the USSR in 1990. the government’s declaration was ratified by an overwhelming majority of citizens in a referendum held more than four month later. But subsequent event, however, highlighted a number of deep seated problems, some of which are rooted in Ukraine’s history.

Ukraine has in fact only enjoyed brief periods of independence or autonomy. The term “Ukraine” developed when much of present day Ukraine was under Lithuanian rule (13^th to 16^th centuries). ‘Krai’ means borderland and its inhabitants were thus defined as dwellers in a boarder area.

The area enjoyed an uncomfortable existence at the cross-roads between Poland (which merged with Lithuania) and Russia. It enjoyed a short spell of autonomy in the 17^th century and a period of independence in 1917- 1921 in the confused years following the overthrow of the Tsar.

Nowadays the emergence of Ukraine as a free and independent country encountered great enthusiasm not only in Ukraine itself, but also in the European Community and its member states. It is clear to everyone in Europe that Ukraine will play a pivotal role on the continent, due to its size, geographical position, economic potential and nuclear capability, in the month and years following independence.

The EC’s aim in its relations with Ukraine is to contribute to the development of Ukraine as a stable, independent, democratic, market-oriented, non-nuclear weapons state of undisputed territorial integrity and with balanced relations with Russia and the West.

The EC will continue to play an active role in developing and implementing measures to help Ukraine ascertain its independence and economic prosperity.

There is no doubt about the importance of an independent, stable and prosperous Ukraine for the stability and prosperity of Europe as a whole.

THE POLITICAL SYSTEM OF UKRAINE

Under the Constitution of Ukraine, the powers of the government are divided into three branches – the legislative, the executive, and the judicial.

The parliament – the Verkhovna Rada is the only body of legislative power in Ukraine. 450 national deputies are elected for four-year term on the basis of universal, equal and and direst suffrage by secret ballot. The Verkhovna Rada elects the Chairman from its membership.

The Verkhovna Rada’s main function is making laws. The other functions of the Parliament are: to call for elections of the president of Ukraine, to hear annual messages of the president from office, to give consent for the appointment of the Prime Minister by the President, to exercise control over the activity of the Cabinet of Ministers of Ukraine, etc. The Verkhovna Rada approves the State Budget for the period from January 1 to December 31 and controls the implementation of it.

The President is the highest official of the Ukrainian state, vested with supreme executive authority. The President is elected directly by the voters for a term of 5 years for no more than two consecutive terms. The president ensures sate independence, national security of the sate, human rights and freedoms. He represents the sate in foreign relations, conducts negotiations and concludes international treaties; appoints members of the Cabinet of Ministers as well as heads of local sate administration and discharges them from these positions. The President is the Commander-in-Chief of the Armed forces of Ukraine.

The highest body of the executive power of Ukraine is the Cabinet of Ministers. It is responsible to the President and is accountable to the Verkhovna Rada. The Cabinet of Ministers ensures the implementation of domestic and foreign policy of the State, the execution of the Constitution, as well as the acts of the President, elaborates and implements national programs on the economic, scientific, social and structural development of Ukraine.

Justice in Ukraine is exercised entirely by courts. It is administrated by the Constitutional Court and by courts of general jurisdiction. The Supreme Court of Ukraine is the highest judicial body of general jurisdiction.

UKRAINE’S ECONOMY

Ukraine is rich in mineral resources. It completely satisfies her needs in iron, manganese and titanium ores, as well as in rock salt, cement gypsum, mineral paints, heat resistant clays, bromine, graphite, mercury and uranium.

Steppes and plains compose the most part of the territory of Ukraine (95 percent). The topsoils are mainly black. They are the biggest treasure of Ukrainian land. Twenty five percent of the world’s black rich soils are in Ukraine. Together with the fact that Ukraine’s climate is mainly moderately continental, and the sediments are 300-600 millimeters, it allows for considerable progress in agricultural production after the village is reoriented towards the market economy.

Because of her potential Ukraine is an industrial-agricultural country. Her machine-building potential includes tractors and agricultural machine building, production of diesel locomotives ad railroad cars, automobiles, rockets, sea and river vessels, refrigerators, TV-sets, washing mashines, electric motors, industrial robots, motor-cycles, equipment for metallurgic, chemical, mine and textile industries, appliances and many other complicated products. Well-developed are black and colored metallurgy, chemical, oil and wood processing, and the cellulose-paper industries.

Since its independence Ukraine has confronted economic problems. The situation today is better in one very important respect than it was in the preceding years: inflation, which was running at 3300 percent annually in 1993 has been reduced.

The main lines of reform now need to be introduced. Some of the main requirements are:

- to pursue a macroeconomic policy which will balance government income against expenditures;

- to close down inefficient factories and to invest in new industries, especially export-oriented;

- to phase out subsidies, particularly to inefficient producers;

- accept that, some decline in total output cannot be avoided in the meantime;

- to introduce a coherent program of privatization, directed not least at the break-up of the very large and poorly managed collectives;

- to stimulate exports, especially hard-currency producing;

- to curb imports so far as possible and to develop import substitution industries;

- to reduce further total energy consumption;

- gradually to introduce free market mechanisms which will eliminate the need for price and wage controls;

- to attract Western investment without sacrificing traditional interests and links with Russia and the CIS;

- to educate and train new generation of managers who have the ability to implement coherent market reforms at all levels;

that Ukraine needs external assistance to tackle its immediate problems is obvious. The government has been able to attract some inward investment.

INDUSTRY IN UKRAINE

Ukraine possesses considerable potential in such sectors of the economy as machine engineering, aerospace, telecommunications, textile, clothing, footwear, and agriculture (due to its unique soils).

Furthermore, Ukraine has a powerful defence industry, significant scientific potential and has shown considerable achievements in the field of designing brand new technologies that meet international standard requirements.

Machine engineering and military industrial complexes have started to produce about 200 types of new products which had not been manufactured in Ukraine before. Among them are food–

processing machinery, medical equipment, transportation vehicles, construction materials and equipment, small farming machines and home appliances.

Ukraine’s major industrial area is in the south-east, namely the Donbas and the Prydniprovye region (Kryvyi Rih coal basin, Zaporizhia, and Dnepropetrovsk). Concentrated here are coal mines, iron and manganese ore deposits, ferrous iron metallurgical plants relating to the chemical, petrochemical and machine building plants and power station.

Among the 150 branches of the national economy, one of the leading is ferrous metallurgy.

In the field of non-ferrous metallurgy, Ukraine holds the monopoly in the CIS in the manufacture of metallic titanium which is vital importance for the economy.

The Ukrainian chemical industry producers mineral fertilizers, herbicides, sulphuric acid, soda, chemical fibers, plastics and other products.

The petrochemical industry of Ukraine is capable of refining 62 million tons of crude oil per year.

POTENTIAL INVESTMENT PROJECTS IN INDUSTRY

1. Pharmaceutical and medical instrumentation.

a) Reconstruction of a Kiev pharmaceutical plant of the production of ready-to-use drugs.

b) Production of essential oils and other inputs for the pharmaceutical industry (capacity 200 tons a year)

2. Engineering and machine-building.

a) Production of lead-acid batteries

b) Reconstructions of plants produce refrigerator compressors

c) Development and production of digital frame data processing systems.

3. Ferrous and non-ferrous metallurgy

a) Production of high quality ingots, semi-finished products billets from titanium, nickel and titanium and nickel-based alloys.

b) Production of rolled raw aluminium billets.

4. Paper, pulp, and woodworking.

a) Construction of straw cardboard factory.

b) Construction of a bleached straw pulp factory.

c) Construction of a palnt for the production of bleached pulp.

5. Power generation facilities.

a) Construction of Chigirin natural gas and steam power plant.

5. Chemical and petrochemical industries.

a) Equipment for production of laminated plastic (reinforced plastic and laminated insulation)

b) Production of fertilizers at ‘AZOT’ plant.

c) Production of sterol.

d) Production of aniline

e) Construction of deep-sea refinery plant.

f) Turn-key project for vacuum oil refining with hot-oil distillation equipment.

The Agro industrial Complex and Industries Associated with it:

Updating and modernization of processing enterprises of food industry; laying-in and storing of the agricultural products; development of enterprises producing machinery for farmers and individual

productions; equipment for oil-fat, meat-diary, flour-grinding, and bread-backing industries, min-shops for farmers, production of effective chemical means for protection of plants; increased output of polymer pipes for provision of gas supply in rural areas, development of enterprises for output of rolled metal sheets, pipes, and metal ware with protective coating.

Manufacture of Consumer Goods and Rendering of Services of People:

Expanded production of electric, television and radio equipment, electric appliances, motocycles, bicycles, cars and spare parts for them; further increase in output of wool, fabric and leather raw materials, clothing products, foot ware, furniture, wall-paper, paper products; development of facilities for manufacturing passenger transport means at the machine-building plants and enterprises of the defence industry; increase in the output of medicines, medical and veterinary equipment, diagnostic apparatus; development and technical modernization of the material and technical basis of the transport complex’s branches that provide public services.

Fuel and Power Supply Complex:

Creation of new andb safe generating plants at the nuclear, thermal and hydroelectric power stations; increase of coal production; introduction of new gas and oil deposits; construction of new systems of gas-mains; expansion of capacities at oil terminals in sea ports and stations.

Metallurgical Complex:

Introduction of steal melting in basic oxygen furnace with its continuous casting; further increase of rolled products with protective coat.

Complex of Chemical and Petroleum-Chemistry Industry:

Creation of modern enterprises based on more thorough and complex processing of resources of the carbohydrate raw material and byproduct coke industry’s raw materials, resources of sulphur and and polymineral ores, installations of improved refining of crude oil; further development of plants for manufacture of modern polymer materials and products based on these materials.

Timber Industrial Complex:

Creation of enterprises for enhanced processing of timber, first of all, the enterprises of pulp and paper industry and enterprises for manufacture of wooden plates.

AGRICULTURE

The agro-industrial complex has always been one of the most important sectors in Ukrainian economy. Ukraine, until recently, was responsible for a very large percentage of former Soviet agricultural production. Ukrainian farms produced 58 percent of all sugar beet grown in the former Soviet Union, 25 percent of meat and dairy products and 20 percent of all grains. While wheat is the primary crop, barely, corn, rye and tobacco are also harvested in the country. Sunflower seeds, flax and potatoes are produced in large quantities.

Ninety-five percent of Ukrainian land is rich in plain black soil, with 14.3 percent (8.6 million hectares) covered by forests.

A critical problem faced by the Ukrainian agriculture sector is product preservation. The capacity of Ukraine in packing materials and storage facilities is below 30 percent. The agricultural processing sector is regarded as the first priority in the Ukrainian economy.

Growing losses during harvesting, storage and processing as well as inadequate transportation have highlighted the need for better and more efficient storage/transportation facilities.

The construction of new storage facilities as well as the development of the transportation infrastructure has been inadequate compared to the apparent requirements and continues to lead to significant losses in production.

According to government projections, a decrease in production losses and an improvement in food processing technologies alone could increase per capita consumption of meat by 0.7 kg. (to 71.8 kg.), milk and dairy products by 2.7 kg. (381.2 kg.), eggs by 10 (285 kg.), vegetables by 14 kg. (153 kg.) and fruits by 7 kg (67 kg).

GRAIN PRODUCTION

The major grain production regions include Odessa, Dnepropetrovsk, Kharkov, Vinnitsa, Zaporozhe, Poltava, Kherson and Nikolayev provinces. Significant return may be obtained if investment is made in the following areas:

a) application of high-quality seeds and chemicals,

b) transfer of the state-of-the-art grain cultivation technologies which may allow for sizable increase in yields; and

c) use of modern harvesting machinery.

SUGAR INDUSTRY

The major sugar producing areas are: Vinnitsa, Khmelnitsk, Poltava, Chercassy and Kiev provinces. Promising directions for investment include:

a) high-quality seeds,

b) transfer of advanced sugar cultivation and harvesting technologies, and

c) re-equipment of sugar processing plants.

EDIBLE OIL PRODUCTION

Ukraine has accumulated vast experience in the production of vegetable oil, especially sunflower and corn oil. Investment in this sector may yield significant returns due to the high export potential of edible oils.

The principal investment areas are:

a) introduction of soya beans and rape seeds which have not been harvested

b) reconstruction of existing plans, construction of new plants for the production of vegetable oil, refinement and packaging of end-products, and improvement in pressing and extracting techniques.

MEAT AND DAIRY

This industry remains quite promising, especially in terms of the production of some items (dry milk, butter, cheese).

The following projects, among many others, have been identified by government authorities as the most important in this sector:

- development of children’s foods with biologically active components for the reduction of radiation effect

- development of processing and storage technologies.

- new technologies for cultivation and processing sugar beet.

- Development of a grape production facility and vineyard.

- Construction of special film-packaging equipment for food products.

- Production of rape and rape seed oil.

- Plant for the production of soft drinks in plastic 1.5 liter bottles.

BUSINESS AND INVESTMENT OPPORTUNITIES IN UKRAINE:

Дата добавления: 2015-07-20