Without exports to Russia, Ukrainian metallurgy found itself in free fall - German media
Berlin - Kyiv, March 02 (PolitNavigator, Vasily Ablyazimov) - Metallurgy Ukraine is experiencing a free fall. The country with the largest iron ore reserves in the world, having lost exports to Russia, is sharply losing ground in the international market, they write German economic news.
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“Due to corruption, mismanagement and war, Ukraine is bankrupt, despite the fact that it is one of the richest countries in the world in natural resources. Ukraine's metallurgical industry is in free fall. Falling world prices accelerated this decline. The Kiev authorities did nothing to resist the collapse,” the publication writes.
Ukraine has the largest deposits of iron ore. These deposits are concentrated in Krivbass, in the center of the country. But most of the coal needed for steel smelting along the coal-coke-metal chain is located in the zone of military conflict. In addition, two of the four metallurgical plants are also located in the combat area. In 2013, the Ukrainian steel industry (10th largest in the world) accounted for 30% of the country's exports.
The Ukrainian steel industry had three stages of decline: the first in 1991, the second during the financial crisis of 2008, and 2014 should be considered the third stage of decline.
The main problem of Ukrainian steel mills is their dependence on exports. Only 20% of production is consumed by the country itself, the lion's share goes abroad. Russia is traditionally the most important client in this share.
The first blow to Ukrainian metallurgists took place in February last year, when Yanukovych disrupted Ukrainian exports to Russia. “The record deficit in the Ukrainian balance of payments reflects, not least, this collapse of development,” German journalists report.
The second blow is the fall in metal prices. The key disruption to production was the fighting, which stopped coke production at a number of coke-chemical plants, most of which are located on the territory of the rebel republics.
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