reduced to the same extend. In 1997 per capita GDP in Ukraine was equal to 1825 griven, that
is approximately 980 US dollars according the Ukrainian National Bank exchange rate. The
parity of consuming capacity for the per capita GDP in Ukraine is equal, by some expert
assessment, to 1.2 - 1.8 thousands US dollars. The decline of GDP growth rate considerably
diminished lately (in comparison with 1996 in 3.1 times) and now it is the lowest from the
beginning of economic crisis in Ukraine. It might be ascribed to the serious progress in the
reduction of inflation as a factor of economic stabilization.
Regardless of some reduction in the decline it has not been overcame entirely. There are
some proofs of that. By 1997 consumer goods output dropped to 28 per cent that of the level of
1990, house construction to 39 per cent, retail trade to 36 per cent, services to 26 per cent.
There has been different rate of decline for different sectors of the economy. The degree
of the decline in machine-building in 1.5 times greater than the total average for the industry.
Machine-building sector has been a hostage of inflation and price growth in raw material,
energy producing sectors, constantly landing them major part of its circulating capital, forced
lose so needed resources for its own production. The share of energy in total costs of machine-
building output equals 25 to 35 per cent. Because the machine-building industry is one of the
main sectors which creates scientific and industrial potential of the country the decline of its
output, especially high-tech products, gives a negative trend in structural changes in Ukrainian
economy and accompanied by a general growth of share for heavy industries.
The output of metallurgical sector has dropped by 50.9 per cent over the crisis period.
This decline is the result of the slump along the whole technological circle of production in the
sector. From 1990 by now the output of main products in the ferrous metallurgy has been
reduced more than by half, steel pipes by more than three quarters. The major factors
determined the slump were as the following:
• fuel and energy deficit;
• lack of circulating capital;
• coal output reduction, especially coke types of coal.
The main consumer for the ferrous metallurgy products is the domestic machine-
building but the consumer suffers from the lake of circulating capital and high prices for the
metal products. Currently the cost of metal products for some enterprises considerably exceeds
the average world prices. For example, the cost of pig iron achieved the level of 180-200 US
dollars per ton while the world price equals 100-120 US dollars, the price for slab of Enakievo
Steel Meal reached 262 US dollars whereas the world price for the same products is 205-215
US dollars per ton.
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