Brainstorming Session: Discus the Topical Questions

1. Is joining the WTO a first step toward Ukraine’s longer-teem goal of becoming member of the EU? Why?

2. Is access to Ukraine’s market stable and predictable for foreigners? Give your reasons.

3. Does Ukraine have a system for making and implementing arbitration decisions on claims of foreign investors?

4. What can you say about the privatization process in agriculture?

5. Are foreigners allowed to own land in Ukraine?

6. What products are exported from Ukraine?

7. Do the goods produced in Ukraine meet the requirements of the European standards? Give the example?

8. Can you give the examples of business success stories in Ukraine? (Coca-cola for example)

Unit II

Text I. BUSINESS AND INVESTMENT OPPORTUNITIES IN UKRAINE

    Ukraine is a country comparable in geographical size and population to Italy and France. The country possesses numerous competitive strengths, namely a strategic geographical position and mild climate, rich natural resources, sizeable consumer market, highly educated labour force, well developed transport infrastructure, significant achievements in natural sciences and military-related research, and a sophisticated research in all spheres of industry and technology.

    However, the Ukrainian economy is currently in a critical position. This is due to the fact that the economy of Ukraine was previously quite isolated, not oriented towards satisfying the national interest of the country. The pricing policy was basically inappropriate because the prices for raw materials and fuel supply were very low and were not stimulating their rational use and the introduction of high technology to industry.

    Ukrainian efforts to be integrated to the world market were, over the first three years, very reticent and did not realize the national potential.

    Prior to independence, inter-republic trade accounted for more than 80 percent of total “exports” and “imports”; as well as being tightly integrated with the economy. Ukraine accounted for a major share about 25 percent of the Net Material Product (NMP) of the former Soviet Union. Needless to say, at independence the severance of the inter-republic links had a particularly disruptive effect on Ukrainian enterprises and on the national economy as a whole. The foreign trade linkages of Ukraine will no doubt play a key role in the recovery of the Ukrainian economy in this transition period.

    Upon gaining independence in 1991, Ukraine has become an equal member of the international community. There is little doubt that the economic, scientific and human potential of Ukraine is one of the most promising in Europe and offers many business and investment opportunities. Attraction of new investments in the Ukrainian economy, including foreign investments, is one of the effective ways of overcoming this situation.

    Relations associated with foreign investments in Ukraine are regulated by a number of Ukrainian laws, Decree of the Cabinet of Ministers, and other legal Acts of the State. Adoption of these Decrees by the Supreme Rada forms legal basis for activities of foreign investors on the territory of Ukraine and proves protection of their interests, gives the amount of authority no less than that of state enterprises. It must contribute to the primary investment in the priority industries and territories.

 

Vocabulary notes

sizeable – широкий

to gain – добывать, доставать, получать

recovery – восстановление

reticent – сдержанный, недостаточный

inappropriate – несоответствующий

disruptive – разрушительный

comparable – сравнительный

sophisticated – сложный

inappropriate -  несоответствующий

reticent – скрытый

severance – разрыв

disruptive - разрушительный

Case study

Background information

    For the first time in its history Ukraine entered the list of the world’s six largest grain exporters in 2002. The agreements for 11 mln t of grain have been lately concluded at commodity exchanges. Many experts believe that gathering and selling the present harvest should be conducted under the condition of deposits for grain purchase, the formation of a grain exchange market. Some countries have agreed to invest on special conditions.

Problem

    Egypt plans to purchase a lot of Ukrainian winter crop. The Ministry of Agriculture of Ukraine has organized a meeting of managers of an Egyptian import company and the Ukrainian Association of grain producers to brainstorm the ideas of selling wheat.

Task

You are members of the Ukrainian Association of grain producers. Work in groups of 3 or 4 persons and brainstorm the points listed in the rough notes. Then meet as one group and select best suggestion for further study.

Brainstorming Session

1. What sort of wheat will be preferable?

2. Will the Buyer deposit in grain purchase? How?

3. What is the world market price for wheat?

4. What is the purchase price?

5. What does the Seller guarantee?

6. When will the sides renegotiate the price?

7. Why shouldn’t the price be fixed?

8. What terms must the goods be released on?

9. How much of the total volume of the contract can be exchanged for buying Egyptian commodities?

10. How much is the Buyer planning to invest in future harvest?

11. When is a long-terms contract possible?

12. What discount can be given and when?

 

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