Modern economic POTENTIAL OF UKRAINE

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Investment portrait of Poltava region

Industry

Production volume in the mining industry increased by 7.0% in 2005 compared to 2004. Natural resources extraction was 364.3 ths. tons of crude oil in 2005, which is 31.1% more than in the previous year; 759.9 ths. tons of gas condensate (1.6% more); and 7,396.9 mn cu. m of natural gas (up 0.9%).

Companies in the food industry and processing of agricultural produce augmented production volumes by 12.8% against the figures of the last year. Production of cream expanded by 76.1%, non-denatured ethyl 80% alcohol by 50.4%, vegetables, fruits, canned mushrooms with vinegar or acetic acid by 36.9%, processed liquid milk by 33.0%, waters, including mineral and other carbonated waters (non-sweetened and non-aromatized) by 32.4%, fresh non-fermented cheese and sour milk (lactic) cheese by 31.0%, fat cheese by 30.8%, canned natural vegetables by 26.3%, chocolate and other ready-made foodstuffs with cocoa content in briquettes, plates, and bars by 23.5%, sausage articles by 17.7%, sour milk products by 12.4%, milk cans by 11.6%, spreads and fat mixes with the fat content 50-85%, including no less than 25% of milk fat in oil phase increased by 10.5%, granulated sugar from raw beet sugar by 8.7%, and prepared feed for agricultural animals and poultry by 6.0%.

Light industry production rose by 4.8% compared with 2004. The output of footwear grew 2.5 times, and pullovers, jumpers, sweaters, and similar articles of machine or hand-made knitting by 28.1%, ladies’ skirts and pantskirts by 19.9%, jackets, blazers, and coats, as well as similar articles for ladies and girls increased by 10.0%.

Pulp and paper, printing, and publishing output over 2005 increased 9.5% in total volume. The volume of book printing grew by 55.2%, and production of school and office articles from paper and cardboard increased by 5.2%.

Production volumes in the chemical and petrochemical industries grew by 21.4% versus 2004.

Production volumes of other non-metallic mineral articles increased by 20.9% in 2005. The production of pre-cast components for housing or civil construction from cement, concrete, or artificial stone increased by 24.0%, and wall construction materials by 10.5%.

Gross agricultural produce in all farms throughout the region increased by 3.5%, including 5% in commercial farms, and by 2% in individual farms.

In total, farms produced 55.6 ths. tons of meat in live weight, 754.0 ths. tons of milk, and 537.8 mn eggs from all kinds of poultry over 2005. Production of meat dropped by 12.7% compared to 2004, while the production of milk and eggs increased by 12.1% and 1.7% respectively. The number of cattle grew by 1.2 ths. cows in all categories of farms (0.6%), pigs – by 40.1 ths. heads (by 13.7%), and poultry by 343.0 ths. heads (by 6.8%).

Foreign economic activities

The volume of commodity and service exports in the region expanded by 36.3% over 2005 compared to 2004 and constituted USD 1,923.1 mn. Imports dropped by 5.5%, down to USD 1,965.5 mn. The negative balance of foreign trade in the region amounted to USD 42.2 mn in 2005 (USD 669.6 mn in 2004).

The volume of commodity exports in the region constituted USD 1,896.2 mn and imports – USD 1,898.1 mn. Export volumes increased by 36.1% and imports dropped by 6.5% compared with 2004. The balance of foreign trade in commodities was negative and totaled USD 1.9 mn. It was negative as well in 2004 and made USD 637.4 mn.

Poltava region accounted for the country’s 5.5% exports and 5.3% of its imports in 2005 versus 4.3% and 7.0% correspondingly in 2004.

Export operations with commodities were conducted by 297 companies and 25 private entrepreneurs with partners from 85 countries of the world. Import operations were accomplished by 400 and 49 businesses and entrepreneurs respectively with partners from 81 countries of the world.

The main export deliveries in the region were destined to the Russian Federation (20.2% of the total export of the region), Italy (14.2%), Austria (6.9%), the Netherlands (6.1%), Turkey (5.2%), and Iraq (4.1%).

The pattern of commodity exports was as follows: deliveries of mineral products – 62.4% (including 39.1% of power generating materials, oil, and refined petroleum products), vehicles and road equipment – 20.4%, mechanical equipment, machinery, mechanisms, electric equipment, and their parts – 3.8%, and ready-made foodstuffs – 3.4%.

The largest volumes of imported goods originated from the Russian Federation (85.3% of imports to the region), Germany (4.2%), and Italy (1.8%).

Deliveries of mineral products made 72.9% of the total import volumes (including 72.0% of power generating materials, oil, and refined petroleum products), mechanical equipment, machinery, mechanisms, electric equipment, and their parts – 7.0%, vehicles and road equipment – 5.5%, and non-precious metals and articles – 3.2%.

The export of services from the region expanded in 2005 by 52.2% versus 2004 and amounted to USD 26.9 mn, and import by 35.3% and USD 67.4 mn correspondingly. The balance of foreign trade remained negative at USD 40.5 mn (USD 32.2 mn in 2004).

The share of Poltava region foreign services amounted to 0.4% in export and 2.3% in import in 2005 against 0.3% and 2.5% respectively in 2004.

Foreign trade operations on the service market were conducted by 235 companies in the region with partners from 105 states. The region had a positive balance with 4 CIS states and 59 other states world-wide. A negative balance was fixed in trade with 7 and 35 states correspondingly. Private companies topped the list of service operators in 2005, accounting for 89.3% of the export share and 99.1% of the import service share in the region.

Great Britain, the Russian Federation, Latvia, and Mongolia were the region’s leading partners in the export of services in 2005, while Great Britain, Switzerland, the Russian Federation, Germany, the Netherlands, Austria, and Poland led the way in the import of services.

Foreign investments

Accrued volumes of direct foreign investments to the companies of Poltava region constituted 287.82 mn as of January 1, 2006, thus exceeding the figures as of the beginning of 2005 by 37%. CIS states accounted for 43.7% of direct foreign investments into the region as of January 1, 2006 (USD 125.7 mn), and other states of the world accounted for a 56.3% (USD 162.12 mn) share.

In general, the amount of direct foreign investments increased over January-December 2005 by USD 77.72 mn considering the exchange rate difference.

The production of coke and oil processing articles, food industry, processing of agricultural produce, wholesale trade, and mediation in trade are among the priorities for foreign investors.

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