Ministry of Foreign Affairs of Ukraine

Kyiv 16:51

Zaporizhzhya Region

Zaporizhzhya Region is one of the impotant components of economic potential of Ukraine. For years of independence of our country the regional enterprises passed the difficult way of overcoming of economic crisis, deep reformation of property relations, structural and technological reconstruction, developing of new markets of sale and adaptation to the conditions of the market state of affairs.

12 years ago the majority of regional industrial enterprises performed the task of defense departments. It seems at first that it will prevent to re-orientation of production. However by results of the year 2002 the index of the regional industrial production by comparison with the year 1990 made 100,6% in the comparative prices. And the volume of industrial production is constantly extended here for already last seven years.

The ninth place in Ukraine by number of population, first place by industrial production volume per capita and third place by general industrial production volume in operating prices (after Donetsk and Dnipropetrovs'k regions) is the economic rating of Zaporizhzhya Region today.

The metallurgical and metal-working enterprises (40%) prevail among the industrial enterprises of the region as well as the machine-building enterprises make 21%, enterprises on production and supply of electric power – 21% and share of food industry – 7%.

The metallurgical complex remains the most important branch of heavy industry. The leader of metallurgy of Ukraine is the JSC "Zaporizhzhya Iron and Steel Works "Zaporizhstal". The International Iron and Steel Institute, IISI includes it in the top biggest 80 iron and steel works in the world. The share of this enterprise makes 69% in the branch in particular and 24% in the general regional volume on the whole. In 2002 the works provided 35% of internal market demands with steel production and the customers of the Zaporizhstal are pipe and machine-building enterprises.

The JSC "Electric Iron and Steel Works "Dneprospetsstal" named after O. M. Kuzmin is the unique Ukrainian manufacturer of high rolled stock plates and forged products from the special steel brands. The production of 800 steel brands has been mastered there, including more than 50 tool steel brands. For satisfaction of growing demand in tool and nonrusting steel the workshop of powder metallurgy was commissioned.

The JSC "Zaporizhzhya Ferro Alloy Plant" is one of the three powerful national manufacturers of ferro alloys and the monopolist on production of ferrosilicon and unique manufacturer of ferro manganese (80%) and manganese metal (90%) in Ukraine.

The share of Zaporizhzhya ferro alloy makers in production of their branch is almost 13%. The production has a stable demand on the national and foreign markets.

The JSC "Zaporizhzhya Aluminium Integrated Works" is the unique Ukrainian manufacturer of primary aluminium, alumina of metallurgical and special brands; alloyed aluminium alloys for motor-car and agricultural machine-building industries. The integrated works produces consumer goods also.

The Government-Run Enterprise "Zaporizhzhya Titanium and Magnesium Integrated Works" is the unique Ukrainian manufacturer of metallic spongy titanium. Its project capacity makes 20 thousand tons per year. The products are exported mainly to the Western countries. The enterprise covers 14% of sales volume of commercial products on the national market. The machine-building industry has the great importance in providing of sustainable social and economic development of the region. This is a biggest branch of the industry by number of workers (76 thousand persons). The enterprises of the branch provide more than 21% of the total regional industrial production volume.

The JSC "Motor Sich" is reliable and economic engines for aircrafts and helicopters. The enterprise masters new types of aviation engines for modern aircrafts as TU-334, AN-70, BE-200 and Yak-130. The industrial gas-turbine equipment and commodities of public consumption is produced also. By order of the Ministry of Industrial Policy of Ukraine the Motor Sich has been chosen as the main enterprise for implementation of actions planned in following sections as engine-building and helicopter-building within the Government Complex Programme of Aviation Industry Development of Ukraine till 2010.

The Joint-Stock Company with Foreign Investment "Zaporizhzhya Motor-Car Plant" is the most national manufacturer of passenger cars. The share of the enterprise in the general regional volume makes 10%. The plant is one of the main performers of the Government Programme of Further Development of Motor-Car Industry of Ukraine. Except for the output of traditional models and their new modifications, the transition to the mass production of the Opel and Mercedes cars is planned.

The JSC "Zaporizhzhya Transformer Plant" is one of the powerful specialized enterprises in the world on production, supply and maintain of practically all types of transformers of the general and special purpose. The Russian Federation covers about 24% of its total sales volume.

Lately the industrial enterprises of the region improved their social orientation. For seven months of 2003 by comparison with the proper period of previous year the output of non-food stuffs has increased by 2.3 times as well as food stuffs by almost 36%. The assortment of food stuffs makes about one thousand names. The production of the JSC "Brewery and Bottling Plant "Slavutich", JSC "Zaporizhzhya Oil and Fat Plant", JSC "Zaporizhzhya Confectionary", Pologivskiy Oil-Extraction Plant (Trade Mark "Slavia"), Zaporizhzhya and Melitopol meat-packing plants has sustainable demand on the national and foreign markets.

The higher concentration and passing ahead rates of development of industrial production of the region conditioned the row of problems. It is the high level of wear of fixed assets in the metallurgical complex (from 46% in the Zaporizhstal and Aluminium Integrated Works up to 82% in the «Dneprospetsstal» Plant). This index is higher in the machine-building industry: ZAZ – 53%, Motor Sich – 56%, Zaporizhtransformator – 61% and locomotive repair plant – 87%. So the ecological situation in the region is difficult.

The agroindustrial complex is the important component of economy of Zaporizhzhya Region. By production of grain the region takes tenth place among regions of Ukraine as well as third place by production of sunflower seed. The financial results of menage became better. Already the third year in succession the agricultural production of the region is profitable. The number of effectively operating agricultural enterprises has been increased by 70%. The intensive science-capacity technologies, hi-tech sorts and hybrids of agricultural crops are introduced; the new breeds of animals, resource conservation systems of agriculture and technical base are renewed.

By volumes of capital building investments the region takes the sixth place in Ukraine. For the last five years the fixed capital has been increased by almost 6.5 billion hryvna and the volume of capital assets put into operation in actual cost made 6 billion hryvna. For 12 years almost 3.7 million sq.m of habitation was put into service and so the habitation conditions for 60 thousand families have been improved. The Special Purpose Programmes as Rural Court and Available Habitation for Young Zaporizhzhya Family are under development; the apartments for servicemen are built. The objects of public utilities are put into service; the water and gas supply of rural districts is on; the social sphere is developed; the transport problems in the regional center are solved. The special attention is paid to gasification. At expense of all sources of financing 1.5 thousand km of gas networks and main gas pipelines were built for the last 12 months.

Zaporizhzhya Region thanks to the powerful industrial and scientific and technical potential, presence of natural resources, home energy resources, availability of markets of Ukraine and the CIS, well-developed transport infrastructure and banking system is one of the most investment attractive regions. It is enough only to mark that by volume of foreign investments the region takes the fourth place in Ukraine, and per capita makes $214 that considerably exceeds an average Ukrainian index.

The privatization is one of the head stones of market development of regional economy. For the last ten years 3389 enterprises changed the form of property here, including almost 70% are the objects of municipal property and more than 30% – state-owned property.

The small business is intensively developed. For the last three years the quantity of small enterprises made 10 thousand units (growth of 60%) and the number of new businessmen makes 75 thousand people nowadays. Almost 18% economic active population of the region is engaged in this sphere today. All these actions are subordinated to the main task – the increase of standard of life of population. It was succeeded to do the real steps on this way. For the last seven years the average monthly wage in the region has been increased by almost six times. In January-July, 2003 the average monthly wage in the region made 511.05 hryvna and this is bigger by 20% in comparison with the proper period of last year. The nominal wage in July, 2003 made 565.03 hryvna (third place in Ukraine after the city of Kyiv and Donetsk Region) that exceeds a living wage by 54.8%. The situation on the labour market is stable and under control. The registered unemployment rate as of 01.08.2003 made 3.2% against 3.4% at the beginning of the year.

All of this is only the small share of everyday selfless labour of Zaporizhzhya inhabitants for the sake of their future.

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