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Economy

The official figure for Gross National Product is $109.5 billion (compared to the U.S.’s $9,255 trillion) and the per capita income $2,200 (U.S., $33,900). However, these figures can be highly misleading because of the very large black economy. With the break up of the Soviet Union, the leading communist party members seized large parts of the economy and its resources for their own purposes. The greater part of the population continues to live in the enforced poverty left over from the soviet system.

Ukraine is well endowed with natural resources. A quarter of the labor force works the large areas of rich agricultural land. In addition Ukraine has large deposits of coal and iron ore, natural gas, oil and metals. The major industries are coal, electric power, metals, machinery, transport and chemicals.

There is a very high level of unemployment because many factories have been closed. And many of those who are employed are often paid irregularly. The unemployed receive little or no support from the social security system and, following the collapse of the financial system, many pensioners found that their pensions were worthless.

The financial infrastructure is undeveloped but the currency (hryvnia) has stabilized and inflation rates have fallen to single figures. In 2000 the growth rate recovered and industrial output is now growing at above 10% per year.

The transport and communications infrastructure is out dated and in bad repair as a result of lack of investment. There is a need for priority attention in this area to encourage general economic growth as there is also in energy production and distribution.