Ukraine is preparing for a complete closure of the Kerch Strait for shipping
Despite the fact that less than 7% of the total turnover of seaports (8,9 out of 133 million tons) passes through the Azov ports of Ukraine, their loss in the event of a complete closure of the Kerch Strait will be noticeable for the country’s economy.
Doctor of Economic Sciences Igor Guzhva writes about this today in the Ukrainian publication “Zerkalo Nedeli”, a Politnavigator correspondent reports.
“Based on the results of an economic and mathematical analysis carried out on the basis of the State Research Institute of Informatization and Economic Modeling, it was found that a complete stop in trade through the Kerch Strait will lead to a reduction in Ukraine’s GDP by 12,7 percentage points, in particular due to a reduction industrial production by 14,3%, agriculture - by 0,6 and the service sector - by 12,7%. Annual revenues to the state budget will decrease by 16,5%,” writes Guzhva.
At the industry level, the greatest losses will be suffered by the ferrous metallurgy industry, whose production will fall by 21,9%. Production of building materials will decrease by 8,7%, electricity - by 8,0%, grain production - by 3,0%, and the provision of transport services will decrease by 6,0%.
However, the economist also saw positive aspects in this hypothetical prospect. He believes that the population freed from iron and steel industry will be able to work in the tourism sector.
“The development of the tourism and recreational potential of the Azov region will stimulate employment of the local population. It should be noted that the tourism and recreation sector provides every 15th job in countries with a high level of development, thus creating the most jobs,” Guzhva wrote.
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