Ukraine Country Profile

General

Ukraine is located in Eastern Europe bordering Russia, Poland, Hungary, Romania, Slovakia and the Black Sea. Ukraine is a nation of 47.5 million people and territorially similar to Texas, but with twice the population. Ukraine’s capital city is Kiev, which is populated by over three million people and located in the central northern region of the country. Ukraine has several other large cities with populations exceeding one million people including; Odessa, Donetsk, Dnipropetrovs’k and Kharkov.

Politics

In December 2004, Victor Yuschenko won a run-off presidential election and was inaugurated as Ukraine’s third post-Soviet president. Yuschenko took over from Leonid Kuchma whose ten year tenure was characterized by indecisiveness. Although President Yuschenko’s victory was a difficult one, he has taken vital measures to reverse the country’s political fortunes.

Since Yuschenko’s victory many steps have been taken to establish Ukraine as an open and democratic country while maintaining the strong economic growth levels of recent years.  Some of the steps taken most recently include:

• Removal of Visa Regime for US and European Citizens
• Reduction of Presidential Powers
• Shifting political power to parliament to ensure a democratic future for Ukraine.
• Open and Transparent Privatization Auctions
• Variety of Economic Reform Programs
• Commitment to Joining the European Union (EU)
• Commitment to Joining the North Atlantic Treaty Organization (NATO)

The Economy

In recent years the trend in the Ukrainian economy strongly been towards stabilization and sustained economic growth. Already in the mid 1990s Ukraine’s GDP had stabilized and in 2000 growth began. The government has taken several important steps towards market liberalization and was recently granted market economy status by the European Union, a move that recognizes reform and liberalization efforts taken by the country.

In the three year period between 2000 and 2004, cumulative real GDP growth was over 70%.

Annual Indicators

	2001a	2002a	2003a	2004a	2005b
GDP at market prices (HRN bn)	204.2	225.8	267.3	344.8	411.4
GDP (US$ bn)	38.0	42.4	50.1	64.8	80.3
Real GDP growth (%)	9.2	5.2	9.6	12.1	3.7
Consumer price infiation (av; %)	12.0	0.8	5.2	9.0	13.9
Population (m)	48.2	47.8	47.4	47.0	46.7
Exports of goods fob (US$ m)	17,091	18,669	23,739	33,432	38,220
Imports of goods fob (US$ m)	-16,893	-17,959	-23,221	-29,691	-37,180
Current-account balance (US$ m)	1,402	3,174	2,891	6,804	4,338
Foreign-exchange reserves excl gold (US$ m)	2,955	4,241	6,731	9,302	14,420
Total external debt (US$ bn)	12.7	13.5	16.3	20.6b	22.6
Debt-service ratio, paid (%)	10.8	13.8	12.6b	12.0b	12.0
Exchange rate (av) HRN:US$	5.37	5.33	5.33	5.32	5.13

^a Actual. ^b Economist Intelligence Unit estimates.

(Economist Intelligence Unit: Ukraine Country Outlook 2006-2007)