Секція «Экономические науки»,

підсекция «Внешнеэкономическая деятельность»

Шевчук Ю.М.

Донецький національний університет економіки і торгівлі

імені Михайла Туган-Барановського

Ukrainian foreign trade. Long-term priorities

Long-term forecasts of development of foreign trade of any country are always a top-priority issue of both for domestic and foreign investors and businessmen. The attractiveness of sectors of the economy that are highly profitable in the long run is the subject.

Numerous economic and political factors and their combined effect determine the development of foreign trade of this of any other country. There are always principal factors that are crucial ones and they are conditioned by constantly influencing circumstances. These principal factors can be caused by nature or society or even from outside reasons.

Among the general problems of society there have always been and will be issues that are first of all related. These related problems involve providing the population with food, adequate energy resources, a suitable living environment, and, finally, providing for security for against outside threats to a country such as preventing military takeover and terrorism.

Let’s review the potential of Ukraine in these areas.

First of all, the issue of providing food for an ever-growing population. “Food” issues in current world are no closer to being solved than they were several hundred years or decades ago. Ukraine with the potential of it’s fertile land resources, favorable climate and with it’s thousand-year traditions of husbandry will always be one of powerful exporters of processed food products and unprocessed foodstuff. In 2008 Ukraine’s grain harvest amounted to almost 40 million tons and more than 11 million grain were exported. Ukraine was one of the top five leading grain exporters of the world.

The potential for harvesting huge crops in Ukraine is so large that foreign companies with leading technologies are eager to invest in Ukrainian agriculture. Currently, Ukraine is just beginning to apply modern technologies of agriculture. So, in the long run Ukraine will always be an influential exporter of grain products in the world’s markets. Even with tough competition Ukraine’s advantage will be the natural quality of its unprocessed and processed agriculture products.

Energy - the second area. The whole last century can be called “the century of struggle of the development countries for energy resources”. Primary energy resources are limited in Ukraine (except for renewable energy sources like wind, solar, geothermal, hydro energy). However, the country has well-developed sectors of energy machinery production, extraction and transportation of oil, natural gas, coal.

In such way, Ukraine will inevitably expand its presence in the world market offering its products and new high technologies for many sectors of economy. Ukraine’s share, which is insignificant now in the world trade market, will be increasing. Confidence in such future development is based on the fact that Ukraine processes the necessary production and intellectual potential, and the overall demand for such products will be increasing in the future.

The third prospective direction in exporting of Ukrainian goods and services is in the production of equipment and in the development for the technologies for the protection of environment and negative influence of humankind’s production activity itself.

The Chernobyl disaster placed the Ukrainian population under extreme conditions of survival. This couldn’t There is no other country in the world that spends so much on ecology (8% of the state budget) as Ukraine does due to the necessity of protection for its population from the consequences of the Chernobyl disaster.

Naturally, this situation creates a certain pressure on society, arouses worry and makes one look for new ways and means for protection and preservation of the natural environment.

It can be confidently stated that within a decade Ukraine will eventually become one of the leading countries in the field of providing high technologies and products in the world market for solving ecology-related issues. This will be the one of Ukrainian’s distinctive features. Ukraine is capable of providing such solutions because as a country itself it urgently needs them – and this is the main stimulus to progress. Also a certain part of Ukraine’s intellectual and production potential of the former military complex can be re-oriented and used for solving ecology issue. As time goes by, investors who put their resources into this field of Ukrainian science and economy will become “founders” of new spheres for the world economy.

Lastly, production of military products is the fourth direction for Ukraine’s foreign trade. Such direction is significant and will continue to be so in the future. Today Ukraine is the top ten leading countries in the field of production of military equipment and technologies. In the year 2008 new military products constituted three fourth of Ukraine’s total military production.

Unfortunately, military conflicts in different parts of the world are not ceasing, which causes the demand for military products to increase. After September 11, a new threat to the world appeared – terrorism. That also causes the demand for specific sophisticated military equipment to increase. Although this market niche is rather specific and pretty much occupied, Ukraine already has competitive products in this field.

All the above – described directions of Ukrainian foreign economic trade will be dominant in the nearest decades. On one hand, this is caused by ever-growing needs in the world market, and on the other hand, by Ukraine’s current potential in the productions of such goods. Of course, now the country’s leading and lagging directions of foreign trade can be determined and their respective market shares can be forecasted. But this is the subject of separate market research.