By Adam Swain
This publication examines the political financial system of makes an attempt to restructure the Donbass, one of many Soviet Union's most vital 'old economic system' 'rustbelt' commercial areas. It indicates how neighborhood curiosity teams have effectively annoyed the primary government's and the realm Bank's proposed market-oriented restructuring, and the way a manufacturing-based nearby economic climate is surviving, in part, with restructuring postponed.
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Extra info for Re-Constructing the Post-Soviet Industrial Region (Basees Curzon Series on Russian & East European Studies)
In short, van Zon argues that prices in the Donbas did not necessarily reflect two independent parties engaging in an economically regulated transaction. Rather prices reflected the control that ‘clans’ had over a sector and vertical commodity chain. Consequently ‘clans’ were able to coordinate prices, akin to internal transfer 38 Adam Swain and Vlad Mykhnenko prices within large companies, and allocate profits and losses to different enterprises and sectors irrespective of their fundamental economic performance.
In addition, estimates of per capita GDP or GVA in (any metropolitan centre like) Kyiv do not take into account large numbers of commuters, who reside in an extensive travel-to-work area outside the administrative city boundaries, thus inflating the GDP per resident count. Only four oblasts, Zakarpattia and Ivano-Frankivsk in the west, Odesa in the south and Donetsk in the east, performed better than the national average. Whereas the two oblasts in the west benefited from cross-border trade and the temporary emigration of inhabitants to find work abroad, and Odesa from the growth of trade at the ports, Donetsk’s performance reflects expansion of the industrial economy there after 1999.
GVA per capita in Kyiv was more than three times the national average and more than six times the lowest ranked, Ternopil oblast. Other territories with a GVA per capita above the national average were Donetsk, Dnipropetrovsk, Poltava, Zaporizhzhia and Odesa, mostly in the south-east of the country. In contrast the least developed territories were Chernivtsi, Ternopil, Zhytomyr and Zakarpattia, predominantly in the west of the country. The west and centre of the country were less developed than much of the east and south of the country, with the exception of two noticeable effects.