The Ternopil region is a developed agricultural and industrial area of
Ukraine. Significant natural and labour resources, the concentration of
processing industry (sugar, alcohol, tinned vegetables and fruits),
geographical location at the crossing-point of important transport
routes from the Eastern to the Central and Western Europe notify the
region as an area with good opportunities of doing business.

A large number of the enterprises, which promise to be profitable and
favourable enough for capital investment, are located in the Ternopil
region. Because of the lack of investment resources in Ukraine, the
Ternopil region is deeply interested in attracting foreign investments.
At present, the largest necessity is in implementation of new
technologies, modern methods of management, infrastructure development,
free market economy experience and practice.

Orientation in economic policy, laws, business environment of the
country, understanding social-cultural traditions, the leading ideas,
mentality of the nation are the key success factors in developing new
markets.

THE TERNOPIL REGION IN CONTEXT OF THE HISTORY OF UKRAINE

The Ternopil region together with Lviv and Ivano-Frankivsk regions is a
part of historical territory, named Halychyna. This Western-Ukrainian
region due to some political events in Ukrainian history which led to
division of Ukrainian lands, since the 14th century was under the power
of Poland, Lithuania (1349-1772), Austria (1772-1918), Russia
(1809-1815), Poland (1918-1939), Soviet Empire (1939-1991).

But the historical difficulties didn’t assimilate but, on the contrary,
stimulated the spiritual activity in the region, notifying it by keeping
the language and cultural traditions, religion and national identity.

The Ternopil region – is an ancient area of pre-Slav settlements. The
traces of man’s staying on this territory go back to the era of early
paleolit (over 100000 years ago). Eastern Slavs who lived on the present
territory of Ukraine, in the 4th century A.D. formed the large unity of
tribes known by the name of Anty. The most widely accepted idea about
the roots of Ukrainians is that they originated from Anty.

In the 9th century the Eastern Slav lands were united into one state –
Kyivan Rus, which was a strong country of the Medieval Europe. The
following data are presented about the density of population at that
time: in the 10th-13th centuries there were 300 ancient Rusian towns and
sites, more than 100 necropolises. At the end of the 11th century there
appeared the following separate principalities: Terebovlianske and
Shumske which were later united into one, named Halytsko-Volynske
principality. The towns of Terebovlia and Shumsk became important
political, economic and cultural centres. Favourable geographic
position, climate, fertile soils, convenient transport routes and water
arteries (the rivers of Dnister and Seret) contributed to the
development of residential sites, especially of the village type.
Commerce and crafts were greatly developed. The main objects of commerce
were bread, cattle, honey, wax, fish, and merchant goods.

According to the point of view of the prominent professor
Ivan-Sviatoslav Koropetsky, two events in Ukrainian history influenced
all its territory and were of great significance: Mongol-Tatar invasion
in the 13th c. and Pereyaslav treaty of 1654 with Moscow. These events
influenced geographic orientation of Ukrainian economy, its separated
lands, i.e. the direction of commercial relations, acceptability of
technological and social progress from some cultural area, which greatly
influenced economic structure and efficiency, other spheres of social
life – policy, religion, law and culture.

A very important role in the life of Kyivan Rus, due to its favourable
geographic position, was played by the foreign commerce. The areas near
the Dnipro river served as a route for commerce between Scandinavia and
Byzantium. The commerce with the East and the countries of Central and
Western Europe was done mostly through Halychyna.

Mongol-Tatar invasion greatly influenced the geographic distribution of
commerce. The commercial relations between Pre-Dnipro territory and
Byzantium declined, but instead of them the new commerce appeared, with
eastern countries: Persia, Afghanistan, India. Especially important was
the transference of the economic and political centre, from Kyiv to the
West – to the cities of Halych, Volodymyr and later – to Lviv. The
Dnister River substituted the Dnipro River as the main commercial artery
between Ukrainian lands and the Black Sea. Halychian tradesmen made
commercial operations through the Black Sea ports not only with
Byzantium, but also with different Italian and French cities, and
commerce with Hungary, Moldova, Poland and Germany became more
developed.

The rebellion led by Bohdan Khmelnytsky (1648) stopped to some extent
the Ukrainian commerce with the West through Poland and Baltic ports.
But it was renewed in the last third part of the 17th century on the
territory of Western Ukraine, which remained to be under the power of
Poland.

After the forced union of Rightbank territory of Ukraine and Volyn with
Moscow, the struggle between Polish, Prussian and Russian manufacturers
started for the markets of the above mentioned Ukrainian areas. Due to
protectional (taxation) policy of Moscow, the local demand for the
industrial goods was usually satisfied by the production from Polish
kingdom or Russia. In the middle of the previous century Ukraine, except
Eastern Halychyna, became fully influenced by the Russian economy, being
limited in relation with other countries, first of all with the Western
European countries.

With the beginning of industrialisation of the European countries in the
second half of the 19th century, 8 steam and 680 water mills, 170
alcohol and beer-boiling plants (in 1910 their number increased to 390)
operated on the present territory of the Ternopil region. Some
slaughterhouses and the enterprises of hide processing, soap, tobacco,
bricks, tiles, wagons and wheel manufacturing also were active at that
time. Among 623 enterprises producing commodity for the population, 250
of them were small, employing 5 or less persons. The railway route
building that started at the end of the 19th century was of great
importance for the economic development of the region. In 1939 on the
territory of the Ternopil region there were 1700 enterprises, employing
8800 workers.

Having survived the ruins of the Second World War, the Ternopil region
developed its agrarian-industrial potential during the afterwar years.
New branches of industry appeared: machine-building, chemical, equipment
producing, building materials, etc. Appearing from ruins the city of the
Ternopil became one of the industrial and cultural centres of Ukraine.

New reality, with the proclamation of the Independence in Ukraine,
determines the direction of changes, which lead to democracy, market,
and state forming. We have to find our own way of development, being
supported by the historical experience of many ages.

GENERAL INFORMATION ABOUT THE TERNOPIL REGION

The Ternopil region occupies the Western part of Podil plateau,
bordering on Rivne region to the North, on Chernivtsi region to the
South, on Ivano-Frankivsk region to the south-west, on Lviv region to
the West. The Ternopil region is situated near the border of Ukraine
with Poland, Slovakia, Hungary and Romania.

The region reminds the triangle, it stretches from the North to the
South for 195 km, and from the West to the East for 129 km.

The climate of the region is moderately continental with warm, damp
summer and gentle winter. Average temperatures range from -5°C in
January to +19°C in July. Average annual rainfall is 520-600 mm.

The region covers an area of 13,8 thousand km2, which makes 2,3% of the
territory of Ukraine. The population in the region amounts to 1142. The
majority of the population in the Ternopil region lives in the villages
(58%).

As an administrative territorial region, the Ternopil region is divided
into 17 administrative districts. There are 16 cities, 19 settlements of
an urban type and 1013 villages in the Ternopil region.

The administrative centre of the region is the city of Ternopil with
about 228 000 inhabitants.

THE STOCKS OF NATURAL RESOURCES

Land resources

Land resources are the main treasures of the Ternopil region. On the
soil surface the black and grey ashed soils prevail which belong to the
group of the most fertile soils in the world. The large part of fertile
soils and the plainness of the territory largely stipulate a structure
of an economic complex in the area and its specialisation.

The level of development of land resources is rather high. Of the
general area of land fund, which makes 1382,4 thousand hectares, 85%
constitute the lands, which are used for providing agricultural
business. The main part of these lands is allocated under agricultural
lands, the area of which reaches about 1000 hectares.

The plough of the territory is 64%. In a structure of agricultural areas
ploughed lands make 84,2% (about 890 thousand hectares). This is one of
the best indexes in Ukraine.

According to a technique of land and residential area money valuation,
authorised by the Decree of Ministers’ Cabinet of Ukraine from the 23rd
of March, 1995, ?213, the average cost of one hectare of plough-land is
determined to be 3564$, correspondingly, the cost of plough-land in the
Ternopil region makes about 2,6 billion USD.

Forest resources

Forests cover about 14% of the regional territory (197,8 thousand
hectares).

On the greater part of the territory the wide-foliage forests are spread
(namely, oak, hornbeam, beech trees), the area of which is equal about
137 thousand hectares. In the North of the region mixed woods prevail.

Opportunities for industrial use of regional forest resources are small,
because of insignificant density of forests on the territory and
qualificative characteristics of woods. The wood stock makes 20,1
million m3 including 0,76 million m3 of mature woods. The felling volume
annually makes about 200 thousand m3.

The Ternopil region takes the leading place in Ukraine in preparation of
non-wood production, i.e. fruits, small fruits, birch juice, medicinal
herbs. The forests of the region possess significant resources of
medicinal raw material. On the area of more than 860 hectares the
plantations of dop-rose (wild rose), guelder-rose, cornelian cherry,
Chinese lemon are created. The medicinal herbs such as St.Jone’s wort,
strawberries, coltsfoot and others are of large significance.

Mineral resources

The main part of mineral resources of the region makes non-ore economic
minerals, in particular, natural building materials, which are explored
in amount of 300 deposits.

Large stocks of mergel are found in the Western part of the Ternopil
region (bed thickness of which is 18-30 m, and the depth of occurance is
15-20m) which is considered as high-quality raw material for manufacture
of cement. But the industrial use of mergel in the region is
insignificant.

Practically in all parts of the region there are the deposits of
limestone (100 deposits are known) and the so called reef limestone, the
deposits of which are rich in the area of Tovtrova Hryada, are unique in
the world, due to large capacity of Calcium. The limestone is used
basically in sugar industry, for limestone burning, for detritus
manufacturing, in road and construction industry.

Significant deposits of clay and loams (more than 100 deposits, the
depth of occurrence of layers does not exceed 7 m) are good raw base for
brick-tile manufacturing. In the Northern and central parts of the
region there are also deposits of fire clay and argil (potter’s clay)
which are used for tile and pottery manufacture.

The region possesses the large stocks of building stone, dolomites and
sandstone. The latter are widely used for high-quality roadway building
and as facing material.

There are also significant deposits of sand. The deposits of
quartz-glaukonit sand are also found, which is the raw material for
glass manufacturing.

The deposits of chalk, being available in the region, are considered to
be rather rare (in Ukraine only 3 deposits are known). They lie very
close to the surface (to 10 m) and are rather thick which allows
extracting them in the open air. Chalk is used in mixed feed production,
for whitewashing of soils, for chalk-pencil production, for paper
manufacturing, in lacquer-dye and pharmaceutical industries.

Potential stocks of gypsum on the regional territory are valued by
dozens of millions of tonnes. In general, more than 20 deposits of it
are known, the thickness of layers of which is about 20-25 m. By the
occurrence and stock conditions the working on these deposits is
possible for a long period of time and in large scale. The gypsum is
applied to in agriculture (for soil gypsuming), in medicine, in paper,
chemical and cement branches of industry. But in spite of the large
stocks, gypsum is not produced and used in manufacture sufficiently.

The peatbogs are of great industrial significance in the Ternopil
region. About 50 deposits are known in amount of about 7,7 million
tonnes of peat.

Among the non-ore economic minerals, the phosphorus can be found in
small amounts on the territory of the region, which are used as mineral
fertiliser, and bentonit clays of high quality are also found and used
as adsorbing material.

Recreational resources

More than 200 thousand hectares of the landscape territory of the region
(15% of the whole area) are of recreational significance.

The main natural units for excursions are Tovtrovy ridge, Kremenets
mountains, Dnistrovsky kanion, karst caves. A lot of holiday hotels,
tourist hotels, guesthouses are at tourists’ disposal.

Large stocks of mineral medicinal waters are located in the region,
which may be used for treatment of internal organs, the organs of
support-moving apparatus and other diseases. The wells of hydrocarbon,
hydrogen sulphide and sulphate waters are also found on the territory of
the Ternopil region.

The Ternopil region is an agrarian-industrial area. Its location in the
Western part of the Rightbank of the partially wooded steppe – in the
area with fertile soils and good damp – contributes to the development
of agriculture. Its location (near the Lviv-Volyn coalfield and
industrial area of Prykarpattia) also contributes to the development of
different branches of industrial production. Region’s location in the
area with high population density determines the prevailing of labour
consuming branches of economy.

GENERAL CHARACTERISTICS OF ECONOMY

The most important industries include:

— food industry;

— machine-building and metal processing;

— light industry;

— the industry of building materials;

— flour and cereals industry;

— wood processing industry.

Food industry, which processes agricultural raw materials, is the
leading one in the economy of the region. The following branches are
mostly notable: sugar, meat, milk, spirit-vodka, confectionery, tobacco,
tinned vegetables, flour grinding and other branches. The sugar industry
is the leading branch (there are 9 sugar plants operating in the
region), concerning the production amount and realisation of products.
Together with alcohol and tinned vegetables they are the branches of
industry in which the Ternopil region is considered to be specialised on
the state and local levels of labour division.

According to national standards the transport network in the region is
well developed. The main kinds of transport are the automobiles and
railway. As for the number of cargo and passenger carryings, the
automobiles take the leading role (the average data – 35,5 million
passengers and 1,1 million tonnes of cargo annually). The length of
regional roads amounts to approximately 5,1 thousand km, when 5,0
thousand km comprise the roads with fixed and steady covering. 370km of
the automobile roads fall per each 1 thousand km2 of the regional
territory, including 362 km of the road with fixed and steady covering.

The regional railway system comprises 575 km, the density of the railway
network makes 41,4 km per each 1 thousand km2, which exceeds the
analogous data in Ukraine (37,6). Every year the railway transport
carries approximately 0,7 million tonnes of cargo and 8million
passengers.

There are several important non-state establishments functioning in the
region, who are to help the businessmen in doing business activities.
Thus, in the Ternopil regional Chamber of Commerce and Industry you can
receive the information concerning the valid business-opportunities both
in the region and outside of it, and also the information about the
local enterprises.

Through contact with the League of Businessmen of the Ternopil region
it’s possible to find reliable business partners, to get acquainted with
the business environment in the region, to receive the necessary support
in practical realisation of business projects.

FOREIGN ECONOMIC ACTIVITY

The export and import deliveries tie the Ternopil region with 72
countries of the world. The main trade partners of the region are
Russian Federation, Germany, Moldova, Poland, Italy, India, USA,
Hungary, and Czech Republic.

The main external sales markets for the production exported from the
Ternopil region are Russian Federation, Germany, Turkmenistan, Moldova,
Poland, India, Georgia.

Owing to the peculiarities of the regional economy specialisation the
products of food industry prevail in the export delivery structure,
livestock and stockbreeding products, machines and power engineering
equipment, textiles, other industrial goods, wood and wood goods.

Among the important production suppliers of the import prevail: Germany,
USA, Russia, Poland, Italy, Czech Republic and Hungary.

The main kinds of products imported to the region are: machines and
electric equipment, production of chemical industry, textiles, base
metals and the articles made of them, synthetic materials and articles
made of them, rubber products, products of plant origin, transport means
and other goods.

PRODUCTION OF THE TERNOPIL REGION, WHICH CAN BE DELIVERED ON EXPORT

Foodstuffs

Butter, Cheese, Technical casein, Dry milk, Meat and subproducts of the
1-st category, Sausage products, Sugar, Tinned vegetables, Canned meat,
Confectionery products, Mineral water, Food concentrates, Liqueur-vodka
products, Food spirit, Noodles

Grain

Barley, Oats, Buckwheat, Rape, Potatoes, Vegetables, Flour, Cereals
(different)

Industrial goods

Porcelain utensils, Glass utensils, Household fixtures, Industrial
fixtures, Cotton fabrics, Shoes, Radio-connection systems «Transport»
&“Orion” types, Decimetre aerials, aerials of satellite connection,
Beet-gathering machines, Furniture, wooden tiles, parquet, Artificial
leather, Goods of household chemistry, Detergents, shampoos

Needs of the region for the most important resources

Automobile petrol, Diesel fuel, Black oil, Diesel oils, Other kinds of
the oil products, Cotton, Mineral fertilizers, Paper, cardboard, New
technological lines, equipment

In terms of nowadays structural economy rebuilding in the region, the
most priority investments are those, which are contributed into food
processing industry, radio-electronic, timber, furniture and light
branches of industry.

Such branches of the economy like industry, trade and public catering,
agriculture, and household services were heavily invested.

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