One of the serious problems of the development of metallurgical complex is the
deficiency of circulating capital that cause the problem of mutual payments. Unprofitability of
the most of enterprises does not allow them to renovate their circulating capital at the expense of
their own sources. Short-run loans, as the experience of few last years show, do not make any
radical improvement of the financial situation at the enterprises. Because of that, the reduction of
production costs, first of all those associated with energy consumption, which make up to 45-
48 per cent of the total costs, is the most actual problem to be resolved. The reduction of energy
consumption in its turn is directly predetermined by the restructuring of the branch of industry
itself.
There is a trend of stability for the share of high energy consuming technologies
producing primarily intermediate not final goods. The share of fuel industry has grown from
3.8 per cent in 1991 to 11.1 per cent in 1997, the ferrous metallurgy - from 9.9 to 23.4 per cent.
At the same time the machine-building has dropped from 26.4 to 15.4 per cent.
The biggest slump has happened in manufacturing sector and those branches of
industries which are working for consumer goods and foodstuff markets. The domestic
machine-building industry has stopped its production almost completely that caused the
distraction of domestic market for electrical appliances and other household machines.
Assessing the situation in the machine-building industry of Ukraine one can say that one
of its peculiarities remains to be the distortion of its production circle, and the commodity-
money turnover. As before there are big structural disparities, the decline of efficiency and the
growing instability at the most of the enterprises.
According to the data of the Ministry of Statistics of Ukraine the output of machine-
building and metal processing in 1996 was 49 per cent, and in 1997 - 48 per cent that of 1990’s.
The share of machine-building and metal processing industry in the total industrial output has
dropped from 30.7 per cent to 15.4 per cent, that is in two times, over the 1990-97 period.
Especially sharp reduction of output has happened in such industries as metal-cutting
equipment production, 8.1 per cent that of the level of 1990, blacksmith’s and press equipment
production - 12.8 per cent, cars - 4.4 per cent (Tables 11, 12, 13).
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