TEXT: ECONOMY OF UKRAINE

(1) Ukraine 's modern economy developed as an integral part of the larger economy of the Soviet Union. Yet, while receiving a smaller share (16 per cent in the 1980s) of the Soviet Union 's investment funds and producing a greater proportion of goods with a lower set price, Ukraine was still able to produce a larger share of total output in the industrial and especially the agricultural sectors of the Soviet economy. In effect, a centrally directed transfer of wealth from Ukraine amounting to one-fifth of its national income helped finance economic development in other parts of the Soviet Union, notably Russia and Kazakhstan.

(2) The collapse of the Soviet economy and a subsequent period of extreme currency inflation in Ukraine brought great hardship to most of the population. Despite early hopes that Ukrainian economic independence, with the concomitant end to the transfer of funds and resources to other parts of the Soviet Union, would alleviate the declining economy and standard of living, Ukraine entered a period of severe economic decline. Daily life in Ukraine became a struggle, particularly for those living on fixed incomes, as prices rose sharply. Citizens have compensated in a number of ways: more than half grow their own food, workers often hold two or three jobs, and many acquire basic necessities through a flourishing barter economy.

(3) In 1995 and 1996 року, however, a strict monetary policy significantly reduced inflation and reforms toward a system based on free enterprise were accelerated. Ukraine introduced its new currency, the hryvnia. In addition, the United States as well as the International Monetary Fund and other international organizations

provided large grants and loans. Attraction of new investments in the Ukrainian economy, including foreign investments, is one of the most effective ways of overcoming economic problems. The country's bank of issue is the National Bank of Ukraine, founded in 1991 and located in Kyiv.

(4) Ukraine can be divided into three economic areas: Southwestern, Donets-Dniprо and Southern. The Southwestern economic area has a high population density, a dense network of roads and railways. This places the area in a favourable position with supplies of metals and fuel for its machine-building plants and the shipping of products to consumers. The largest reserves of minerals and the valuable wood of the Carpathian forests are used in the chemical, gas, mining, timber, paper and porcelain industries. The engineering industry produces test instruments, machine tools and electrical engineering equipment.

(5) Extractive industry is concentrated in the Donbas and along the Dnipro River. In the far west, mining takes place in the Lviv-Volyn coal basin north of Lviv and in Subcarpathia, south of Lviv and northeast of the Carpathian Mountains.

(6) Ukraine has extremely rich mineral resources in high concentrations and close proximity to each other. Rich iron ore reserves located in the vicinity of Kryvyi Rih, Kremenchuk, Mariupol, and Kerch form the basis of Ukraine 's large iron-and-steel industry.One of the richest areas of manganese ores in the world is located near Nikopol. Bituminous and anthracite coal used for coke are mined in the Donbas. Energy for thermal power stations is obtained using the large reserves of brown coal found in the Dnipro River basin and the bituminous coal deposits of the Lviv-Volyn basin. Ukraine has also deposits of titanium ore, bauxite, nepheline (a source of soda),mercury and uranium.

(7) The three major areas producing natural gas and petroleum in Ukraine are Subcarpathian region, the Dnipro-Donets and Crimean regions. The most promising deposit of oil in Western Ukraine is the Dolyna field. In the Dnipro-Donets region the largest gas fields are Kharkiv Province. Gas deposits have been also discovered in Sumy, Poltava and Dnipropetrovsk provinces.

(8) Ukraine's depths are rich in non-metallic minerals, which are widely used in the national economy. The important ones among them are rock and potassium salts, sulfur, fire clay and building materials. The largest deposits of rock salt are centred in the Donbas and in Solotvyno in Transcarpathia. Subcarpathia possesses potassium salts and the largest deposit of sulphur. A large deposit of ozokerite (a natural paraffin wax) occurs near the city of Boryslav. Large reserves of red and grey granite, chalk, marl are also found in Ukraine. There are

many curative mineral waters in Ukraine.

(9) The country 's labour force totaled 25.4 million people in 1996. Some 40 per cent of workers are employed in industry, 40 per cent in the service sector, and 20 per cent in agriculture. Unemployment is rising steadily, especially in the form of hidden unemployment, which includes people who have been kept on payrolls but have not been paid salaries. Trade-union membership is strong, reaching nearly 100 per cent of the workforce. The miners 'unions are especially active.

Comprehension exercises

I. Find where in the text it is said:

♦ що сучасна економіка України розвивалась як невід'ємна частина економіки Радянського Союзу

Ukraine 's modern economy developed as an integral part of the larger economy of the Soviet Union.(1);

♦ що залучення іноземних інвестіцій є одним з найефективніших способів подолання економічних проблем

Attraction of new investments in the Ukrainian economy, including foreign investments, is one of the most effective ways of overcoming economic problems.(3);

♦ что найбільші поклади кам'яної солі зосереджено в Донбасі та в Солотвіні Закарпатської області

The largest deposits of rock salt are centred in the Donbas and in Solotvyno in Transcarpathia.(8).

II. Explain the following phrases taken from the text (paragraph numbers are given). Use a dictionary if necessary:

1. period of extreme currency inflation (2)

The period of extreme devaluation of the currency and due to rising commodity prices.

2. to acquire basic necessities through a flourishing barter economy (2)

Purchase basic necessities through the economics of exchanging goods.

3. reforms toward a system based on free enterprise were accelerated (3)

Accelerated reforms to a system based on free enterprise, ie the functioning of the economic system on the principles of maximum economic freedom for economic entities and minimal government intervention in these activities.

III. Answer the following questions. Try to express your answers in your own words if possible:

1. How did Ukraine's modern economy develop?

Ukraine 's modern economy developed as an integral part of the larger economy of the Soviet Union. 

2. What brought great hardship to most of the population of Ukraine? 

The collapse of the Soviet economy and a subsequent period of extreme currency inflation in Ukraine brought great hardship to most of the population.

3. What are the main reasons of severe economic decline? 

The collapse of the Soviet economy and the subsequent period of extreme currency inflation in Ukraine are the causes of a severe economic downturn.

4. What is one of the effective ways of overcoming economic problems in our country? 

Attraction of new investments in the Ukrainian economy, including foreign investments, is one of the most effective ways of overcoming economic problems.

5. What economic areas can Ukraine be divided into? 

Ukraine can be divided into three economic areas: Southwestern, Donets-Dniprо and Southern.

6. Which of them has a high population density? 

The Southwestern economic area has a high population density, a dense network of roads and railways.

7. Where is extractive industry concentrated?

Extractive industry is concentrated in the Donbas and along the Dnipro River. In the far west, mining takes place in the Lviv-Volyn coal basin north of Lviv and in Subcarpathia, south of Lviv and northeast of the Carpathian Mountains.

8. What forms the basis of Ukraine's large iron-and-steel industry? 

Rich iron ore reserves located in the vicinity of Kryvyi Rih, Kremenchuk, Mariupol, and Kerch form the basis of Ukraine 's large iron-and-steel industry.

9. What mineral resources is Ukraine rich in? 

Ukraine has extremely rich mineral resources in high concentrations and close proximity to each other. It is rich in iron ore, manganese ore, bituminous and anthracite coal, brown coal. Ukraine has also deposits of titanium ore, bauxite, nepheline (a source of soda),mercury and uranium.

10. What are the three major areas producing natural gas and petroleum in Ukraine?

The three major areas producing natural gas and petroleum in Ukraine are Subcarpathian region, the Dnipro-Donets and Crimean regions. The most promising deposit of oil in Western Ukraine is the Dolyna field. In the Dnipro-Donets region the largest gas fields are Kharkiv Province. Gas deposits have been also discovered in Sumy, Poltava and Dnipropetrovsk provinces.

11. What are the most important non-metallic minerals used in the national economy of Ukraine?

Ukraine's depths are rich in non-metallic minerals, which are widely used in the national economy. The important ones among them are rock and potassium salts, sulfur, fire clay and building materials.