Up until now, Ukraine’s economy was considered the fastest growing in Europe. That is largely due to its industrial sector which keeps about a quarter of the workforce employed. It contributes to more than 40 percent of its GDP whilst agriculture accounts for a quarter.
Ukraine has seen an upturn in its economic fortunes this millenium. Economic growth stands at 6 percent and inflation has fallen to 6 percent. Its foreign debt is 9 billion euros and last year’s GDP
per capita more than 4000 euros.
Ukraine draws much of its economic strength from its fertile soil and is a major exporter of agricultural products.
But that is not all, the soil is not only thriving in greenery but is also rich in minerals. In fact the Russian speaking east holds 5 percent of the planet’s mineral resources where there are not only iron deposits but also large coal reserves.
Ukraine’s other major strength lies in its industrial sector. It manufactures heavy machienery and industrial equipment, from trains, passenger and cargo planes, to ships.
With some 500 apparently reputable registered firms, defence and aerospace also figure high in the economy. But it has not always been so. Ukraine did not escape the economic hardship brought on by the break up of the former Soviet Union nor the painful shift from communism to the free market.
However it has been given a significant helping hand by the US. Kiev is Washington’s third most important benefactor after Israel and Egypt. Since 1991 it has received some 2 billion euros in aid. The European Union has also delved deep and has provided 1.5 billion euros in financial and humanitarian funds.
Since Russia’s financial crisis in 1998 Ukraine has moved steadily into a free market economy.
It proceeded more cautiously than its neighbour with 50 percent of its economy generated by the private sector.
However analysts warn that if it is to enjoy further growth it will have to tackle two blots on the Ukrainian business landscape: bureacracy and corruption.