Despite these potential losses, Russian officials have been downplaying the impact that severing military and defense relations would have on both the modernization efforts and the current state of the Russian military.
As for other products, Russian President Vladimir Putin has stated that Russia will be able to replace defense-related imports from Ukraine within two and a half years. For Ukraine, a permanent loss of military manufacturing ties with Russia would be devastating in the short term. Ukraine makes few complete weapons systems other than T tanks, some Soviet-era air-defense missiles and space satellites, and Antonov planes. Kyiv would struggle to find alternative markets for its mainstay production of Russian military hardware components.
Such a collapse would likely result in unemployment levels in the defense industry not seen since the breakup of the Soviet Union. The cutoff of defense-industrial ties between Russia and Ukraine is bound to exacerbate the economic crisis already afflicting Ukraine, especially in the east of the country, which is now suffering from a military conflict as well. Perhaps more worryingly, the crisis will also increase proliferation risks of dual-use, nuclear, and ballistic missile technology and expertise abroad.
This is not the first time that proliferation concerns have arisen in Ukraine. After the breakup of the Soviet Union, Ukraine had the largest proliferation potential after Russia in the form of scientists and specialists who found themselves out of work. In , the United States launched a pioneering series of programs designed to ensure that the scientific and engineering talent of the former Soviet defense-industrial complex did not fall prey to rogue regimes and international proliferators.
Under the auspices of the initiative, U. In , the Russian government felt it no longer needed assistance from the United States , and an abridged successor arrangement was negotiated between the United States and Russia to continue their joint efforts in the area of nonproliferation. Although the United States has suspended its cooperation with Russia in many areas following the annexation of Crimea by Russia, some cooperation on nonproliferation has continued.
That cooperation must be maintained if the international community wants to help Kyiv protect its most sensitive defense-industrial expertise. The importance of reducing the risk of proliferation should not be underestimated. Chinese and North Korean agents have on several occasions been caught attempting to break into Yuzhmash and acquire long-range ballistic missile technology. In , two North Koreans were arrested for spying after they tried to steal classified missile technology from a Dnipropetrovsk-based designer of satellites and rockets.
There also exists well-documented reporting of uncontrolled flows of small arms and light weapons into Syria through a group of Ukraine-based individuals and logistics companies known as the Odessa Network. The risks of proliferation have worsened in recent months. The location of major Ukrainian defense industry enterprises in the east of the country, where government control is at its weakest, underscores the severity of the problem. By filling in this form, you are agree with our Privacy Policy.
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But in the heavily industrialised Donbass area of eastern Ukraine , many are wondering what this geopolitical tug of war might mean for them. The Donets basin — the political home of Yanukovych and his Party of Regions — hosts numerous Soviet-era factories: machine-building works, steel and chemical plants, mines, and medium-sized businesses that make fridges.
At the pithead, Yefromov was gloomy about the mine's prospects. Lydia Popova, a mine employee for more than four decades, and the editor of its internal newspaper, disagreed. Ukraine wants to be independent from Putin," she said in Russian.
The people who work hardest underground here are the Ukrainians. Popova conceded that many mines in the area had closed, including five in the nearby town named after Alexey Stakhanov , the Soviet coal-miner made famous by the communist party for his quota-busting records.
Popova may be right. There is still a demand for coal in Ukraine, even though much of the industry has crumbled. Big factories use coal, as do villagers not connected to the electricity grid. Numerous illegal surface mines known as " kopanki " also exist amid the small, depressed towns of Donbass's outer regions.
The new provincial governor, local oligarch Serhiy Taruta, pledged this week to shut the kopanki down. Donetsk was founded in the s by an enterprising Welshman, John Hughes, who constructed its first steel mill. In recent febrile weeks some pro-Russian campaigners have been calling for Donetsk to follow Crimea and join Russia. More than 7, Ukrainians, though, have voted in a spoof online referendum for the city of 1 million to become part of another state — the United Kingdom.
Capital productivity was higher in practically all of the industrial branches in Ukraine than in the favored Asian regions. The industrial development of Galicia under Poland , Transcarpathia under Czechoslovakia , and Bukovyna under Romania stagnated during this period. The postwar period until Because of Ukraine's geographical location, its industry was severely damaged during the Second World War.
At the beginning of the hostilities, the Soviet authorities dismantled and evacuated complete plants eastward, primarily to western Siberia , with the intention of reassembling them for use in the war effort against the Germans.
Because of poor organization and the lack of supplementary inputs, only a small portion of these enterprises were actually put into operation.
The remaining equipment and machinery were either included in the existing enterprises or remained unutilized, while unevacuated enterprises were systematically destroyed by the retreating Soviet authorities. The Germans were both unable and unwilling to revive industrial activity during their occupation of Ukraine, and whatever was still usable they destroyed prior to the return of the Red Army.
According to Soviet statistics, the damage incurred by Ukraine's industry during the war amounted to 44 billion rubles in prices ; 16, industrial enterprises were completely destroyed or extensively damaged. It is difficult to apportion exactly the responsibility for this destruction, but it is safe to assume that the Soviet authorities were no less culpable than the Germans.
The main Soviet objective during the early postwar years was the speedy reconstruction of industry, even at the expense of other economic sectors. Because of great sacrifices by the population, the prewar level of output was already exceeded by see Table 5.
Reconstruction was facilitated by installing machinery and equipment taken by the Union of Soviet Socialist Republics as reparations from its former enemies. There is no indication that any of the assets of Ukraine's industry that were evacuated at the beginning of the war were ever returned.
A trend of constantly declining growth rates could be observed in Ukraine during the postwar period, as in all of industry in the USSR. The decline was particularly sharp after the mids see Table 6. The growth rates of individual industrial branches during the years —65 and —85 are presented in Table 7.
The growth of the traditional branches of Ukraine's industry—fuels especially coal mining , ferrous metallurgy, and food processing—slowed down relatively more than that of other branches. Soviet statistics tended to bias growth rates upwards, especially during the early postwar years, and give a growth rate for Ukraine's industry of almost 13 percent between and Although revised Western estimates show it was closer to 9 percent, even this lesser figure can be considered robust by world standards.
Industry's share in Ukraine's net material product varied between According to a Western estimate, its share in the gross national product was Ukraine never regained its prewar position within the entire industry of the USSR, however, even though the growth rates of its industry and that of the USSR as a whole have been almost identical during the —85 period 8.
The development of Ukraine's industry during the postwar period can be summarized by using the indicators in Table 8. The growth of output in the years —85 was almost half that of the years —65, although Ukraine's shares in the USSR for the three benchmark years did not change appreciably. The slowdown in output growth in Ukraine could be attributed largely to a slowdown in the expansion of inputs labor and capital rather than to the productivity.
Employment growth fell sharply from 4. Also, the share of Soviet investment in Ukraine diminished steadily after Table 8. Since Soviet fixed-capital growth declined after , the declining Ukrainian share of investment means Ukrainian fixed-capital growth fell even more than the Soviet total. Some reasons for the slowdown of industry during the s and s were applicable to the entire Union of Soviet Socialist Republics , including Ukraine.
First, in view of the declining rate of entrants into the labor force and the continued high rate of capital formation, diminishing returns to capital were being experienced. Second, a decline in resource productivity—the result of inefficient and centralized planning and management, including a defective incentive structure—was often suggested as a cause of slowdown. There were also factors that were specific to Ukraine: depleted fuel coal, oil, gas reserves and the rising cost of their extraction, exhausted hydro energy sources, a water shortage, and an imbalance between the supply of agricultural raw materials and the necessary processing facilities.
Perhaps of greatest importance was the relatively declining allocation by the central planners of investment in the economy of Ukraine, including its industry Table 8. As a result, new technological processes and the modernization of the industrial structure could not be fully introduced in Ukraine.
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