Mykolaiv Region

In the south of Ukraine, in the downstream basin of the South Bug there is Myikolayiv oblast (district), which occupies territory of more than 24.6 thous. km2, which is 4,1% of the total Ukrainian territory.

In the west, north, and east the oblast borders three other Ukrainian oblasts: Odessa, Kirovograd and Kherson oblasts. In the south its territory occupies a few hundred kilometers of the Black sea coast with marshes. In that place the coast is deeply cut by Dnieper-Bug, Bug-Berezan and Tyipigul marshes, which create an amazing plexus of water reaches.

Speaking about the natural conditions, the oblast is located within the borders of 2 physico-geographical zones: forest-steppe (Kryivoozersk and western part of Pervomaysk region) and steppe (the rest of the territory), predominantly within the borders of the Black sea lowland.

85 rivers flow through the territory of the oblast. They belong to the South Bug and the Dnieper basins. The biggest rivers are the South Bug, 257 km long (on the oblast territory), Ingul 179 km, Ingulets 96 km. Dnieper-Bug marshes have 63 km of the cost cut, Tyipigul marshes – 60 km, Bug marshes 42 km, Berezan marshes 26 km. On the oblast territory there are many artificial lakes, which have the total area of the water surface more than 13 thous.hectares. Rivers and artificial lakes are used, principally, to irrigate agricultural lands and for fishing.

The climate of the oblast is moderately continental with mild, little snow winter and hot dry summer. Annual average temperatures are: in summer: +21.1°C, in winter: -2°C. Average annual rainfall fluctuates from 330mm. in the south to 450mm in the north. Soils: in the north ordinary black soil, in the south southern black soil of chestnut and dark chestnut colors.

More than a hundred big and small nations dwell on the oblast territory. The majority of the population is made up of Ukrainians more than 75%, and Russians – 20%. Among other nations one can find Moldavians, Bulgarians, Greeks. Such a population composition is very favorable for setting up good relationships with different countries.

As of December 5, 2001 the total population of the oblast was 1,251.5 thous.people, out of which 66% (838 000 residents) are urban residents.

Administratively the oblast has been subdivided by 19 regions. All in all there are 934 settlements in the oblast, out of which 26 are towns and 908 villages. Among towns there are 5 towns of the oblast scale: Yuzhnoukrainsk, Pervomaysk, Voznesensk, Ochakiv and Myikolayiv.

Mineral resources in the oblast are represented by considerable deposits of construction materials: construction stones more than 627 mln.cub.m., granite, which is famous for its wide spectrum of colors and high decorative qualities 51.3 mln.cub.m; sawed stone 72.3 mln. m3; cement components 60.7 mln.ton, tile components 48.1 mln. m3; construction sand 123.7 mln. ton. Deposits of limestone 16.4 mln. ton, kaolin 113.6 mln. ton, road construction materials etc. are also of industrial importance.

Total area of forest covered areas reaches 70 thous. hectares out of which 38 thous. hectares are pure forests. 1.5% of the oblast territory is covered by forest. The major tree types are oak, pine, white acacia, poplar, etc.

Sea sand beaches are the major natural recreational resources. They stretch to cover 70 km. Picturesque landscapes of the southern Bug and numerous artificial lakes, spa water fountains with the prospected exploitation reserves up to 1 mln. m3 per day, geological reserves of medicative mud, especially in Tyipigulskiy and Beikushanskiy marshes, equal to more than 2 mln. m3.

The region is known for its lengthy warm period with the average 24h. air temperature on the sea coast to be more than 15°C. More than 11 thous.ha of forest are used as recreational site, including 4 thous.ha of "green" areas around towns.

Economic potential of Myikolayiv oblast is a compositional part of the Ukrainian economy as a whole. It is represented by powerful multi-branch industry, developed agricultural-and-industrial complex, well developed transportation network and developed sea-port economy. The oblast industrial potential is mostly centered in 5 towns. Their share in total oblast industrial output is almost 95%.

Myikolaiv is the center for machine-building industry, including shipbuilding, non-ferrous metallurgy, food and light industries, where more than 60 big enterprises are functioning with the share in the oblast industry output of more than 51%. Three sea ports and a river port are functioning there. They are equipped with modern gntries and other equipment. Technical capacity of the trading sea port to process different freights reaches 9 mln.ton annually. Navigation lasts all year round.

In Yuznoukrainsk there is a nuclear power station, which produces 35% of the oblast electric power.

Pervomaysk profiles in diesel engines and diesel generation production, in agricultural machinery production, production of sugar, milk preservatives and products of sewing industry.

Voznesensk is profiling in the production of leather, shoes, food and products of sewing industry and Ochakiv is famous for fish preservatives.

Agriculture is second in output and first in employment branch in the oblast economy. 1.3 ha of cultivated land falls on every oblast citizen and theoretically, every person, occupied in agriculture, has 11 ha of plowland. These features of Myikolayiv oblast open up great opportunities for investment in agriculture with the aim to employ industrial know-how, powerful and highly efficient machinery.

The oblast has substantial export potential. The district enterprises keep business relationships with partners from 101 countries. In some years Myikolayiv oblast share in Ukrainian export is 3.6%. Alumina is a substantial part in the oblast export structure. In addition to alumina the oblast exports ships, mechanical equipment, leather, vegetation products, etc. Import structure is primarily made up of bauxite, oil products, chemical industry products, etc.

INDUSTRY

The leading oblast profile is ship-building. The biggest enterprises of this branch are 3 major ship-yards:

• State Joint Stock Holding Company "Chornomorskiy shipbuilding Yard";
• State Enterprise "Shipbuilding Yard named after 61 Communards";
• Open Joint Stock Company "Damen Shipyard Ocean".

The major products of these powerful enterprises are tankers, freighters, container ships, refrigerators, trawlers, ship-hotels, launches, etc.

Ship-building branch has been nominated in Ukraine as the prioritized one. It has a very big export potential. 13 July 2000 the Ukrainian law "About Special economic Zone "Myikolayiv" was adopted. The oblast dwellers hope that implementation of that law will provide for the ship-building revival.

 A number of companies, which ensure production and installation of technological equipment on ships, also belong to this branch. Among them we find JSC "Era", "Crystal", "Equator".

Production amalgamation "Zorya" produces gas-turbine engines of 16MVt capacity, updated gas transporting units for compressor stations, reducers for wind power generating units and steel works, foundry and forging products, welded metal constructions, consumer goods.

Scientific-production amalgamation "Mashproject" designs and produces multi-profile gas-turbine engines, which are used to equip ships, to transport natural gas and to generate electric power.

JSC "Pervomayskiy zavod "Dieselmash" produces diesels, diesel-generators and diesel-gas-generators.

Non-ferrous metallurgy also plays an important role in the oblast industrial potential. It is represented by one of the biggest in Europe aluminum producers JSC "Mikolayiv Alumina Plant".

In Myikolayiv there is a single in Ukraine plant to produce asphalt laying and filtering equipment, "Dormashina". Pervomaysk plant "Fregat" provides Ukraine with sprinkling machines of the same name.

The oblast also holds a number of electro-technical and electronic enterprises, which are staffed with highly qualified personnel. These are the JSCs "Ingul", "Fakon", "Edmma".

Myikolayiv oblast light industry produces up to 8.8% of the total Ukrainian light industry output. It is represented by big sewing enterprises, which produce mens, womens and childrens wear. They are: JSCs "Evis" (Myikolayiv), "Santa-Ukraine" (Pervomaysk), private firm "Victoria" (Voznesensk); knitted and haberdashery products JSCs "Aura" and "Angela".

The most competitive company in the area of producing natural skin is a CJSC "Vozko" (Voznesensk). Its share in Ukrainian leather output is almost 50%. Modern equipment and technologies provide for manufacturing annually 350 mln.sq.dm of high quality leather. The leather produced by the company is used by big Italian, Slovakian, Spanish, Canadian and Russian companies for the upper part of shoes

JSC "Niko" is a footwear producer. This company produces updated footwear models and is ready for international cooperation. OJSC "Nikkozh" is busy with producing leather for upper and inner parts of footwear, and belts.

A chain of enterprises to process the gifts of the sea functions in the oblast. The biggest company of such type is JSC "Ochakiv Fish Cannery" with annual capacity of 16 mln. conditional cans. This company products are of increased demand.

Food industry holds one of the prioritized positions in the oblast. Its share in the state industrial output is more than 2.2%. Meet processing industry is based on agricultural products processing capacities, which help manufacture up to 220 ton of cattle and 27 tons of poultry per shift.

Milk acceptance and processing are carried out by 12 enterprises, out of which the most powerful are: JSCs "Laktalis Ukraine", "Pervomaysk Milk Factory", Voznesensk and Bashtan Cheese Plants. Production capacities of all the companies are calculated to produce every 24 hours 32 tons of butter, 270 tons of milk products and 96 conditional cans of milk preservatives.

Production of flour, bread and macaroni products is carried out by the companies "Elevatorzernoprom", JSC "Nikma" and by 131 bakeries.

Production capacities of the JSC "Gileya" and "Shelton-Myikolayiv" help manufacture every 24 hours up to 10 thous. tons of sugar beets. In the region there is also a company "Sandora", which produces different beverages, canned juices and light wines. JSC "Nectar" produces such products range as confectionery goods, mayonnaise, vinegar and beverages.

Wines, produced by the JSC "Cobleve" (village Cobleve) and beer, produced by JSC "Yantar" (Mikolaiv) are well known and won highest marks among Ukrainian consumers.

Except Myikolayiv liqueur & vodka plant and oblast communal trade-production company "Frost" all the companies of light and food industry have been privatized.

GENERAL CHARACTERISTICS OF THE "MYIKOLAYIV FREE ECONOMIC ZONE (FEZ)"

1. FEZ territory
Special economic zone "Myikolayiv" was set up within the limits of land sites, where Myikolaiv shipyards are located:

• state JS holding company "Chornomorsk ship building plant" (the area is 340 ha, including 43 ha of the South Bug water area);
• OJSC "Damen Shipyard Ocean" (area is 240 ha, including 30 ha of the South Bug water area);
• state enterprise "Ship building enterprise named after 61 communars" (area is 160 ha, including 40 ha of the South Bug water area) and the adjacent territory with the total area of 120 ha, belonging to Myikolayiv city council.

2. Production capacity
Myikolayiv plants are highly experienced in ship building and have considerable technological potential. If using this potential, even without making investments into production capacities, plus the necessary working capital, it is possible to get annually the output of 400-500 thous. tons of dead weight on the condition of utilizing a complex cooperation program to build up ships. With the great experience in high tech production, the plants are able to perform orders of the highest demand.

Myikolayiv shipyards have a specific feature: availability of two production lines for making 30 average tonnage ships annually, depending on the type of the ship. Big tonnage ships are produced with the help of the method, which stipulates pre-building berth increase of the constructions up to 500-1500 tons, which considerably decreases the building cycle.

FEZ "Myikolayiv" has a specific feature: performers on the territory of FEZ are permitted to use available production capacities and infrastructure elements of the ship building complex for own needs on contract conditions, which releases investor from the necessity to build up new capacities and accelerates deployment of his production.

At investors services there are numerous well-equipped store-houses with the total area of 264 thous.sq.m., shop premises with the area of 2 thous.sq.m. together with amenity and administrative buildings, equipped with cranes and rail ways, mooring lines and other means.

The plants territory is staffed with engineer networks in the volume, sufficient to deploy new types of production capacities for machine-building and instrument-building profile, agricultural products and food processing lines without hampering the plants primary production programs.

The available power supply network provides for transferring additional power, necessary for setting new production lines in the volumes of 20-25 MVt even without considering the power supply capacities, which exist outside the plants.

FEZ territory is located within the limits of one administrative-territorial unit and is 69 km. away from the Ukrainian sea border-line. It has a water route to the outside world.

The area, delineated by law for FEZ, is located on the periphery of residential areas, has a pass to the coast of Bug marshes, has a ship passage, which is usable for sea ships. All the areas of the zone are connected between each other by the city and oblast transportation & communication network.

3. Benefits, awarded to the subjects of FEZ "Myikolayiv"
According to the Ukrainian law "About Special Economic Zone "Myikolayiv" Ukrainian legislation will act for the period of its existence (30 ears) with consideration of the specific features, stipulated by the aforesaid law

FEZ "Myikolayiv" subjects are the subjects of entrepreneurial performance legal entities, who are located on the territory of FEZ and implement on this territory investment projects in the prioritized branches of economic performance according to the contract pertaining to the implementation of that investment project. Those legal entities must be registered with the office of FEZ management.

All the subjects of FEZ are to have benefits in paying import duty, VAT, profit tax and land tax.

Benefits, determined by the Ukrainian legislation:

1. Discharge from paying import duty for raw materials, property, equipment and completing parts for the period of investment projects implementation, but not more than for the period of 5 years, when carrying them into the territory of FEZ for the needs of own production, related to the implementation of the investment projects (except the excisable products)

2. Discharge from paying VAT for the period of the investment projects implementation, but not more than for the period of 5 years, from the imported property, equipment and completing parts (except the excisable products) which are to be used by the subjects of FEZ for their own production needs, related to the implementation of the investment projects

3. In case of setting a special customs zone on the territory of shipyards, which is stipulated by Article 9, Ukrainian law "About special economic zone "Myikolayiv", FEZ subjects, located within the limits of those special customs zones, are released from paying import duty and VAT for the products and other items, imported to the special customs territory from abroad

4. Discharge from paying export duty and VAT by the zero rate for products and other items (except the excisable items) in case they have been brought from the Ukrainian customs territory to the special customs zone for their utilization within FEZ due to production needs

5. Discharge from paying VAT by the zero rate for products, services, works if they are sold within the FEZ limits in the framework of inter-plant cooperation

6. 3 years release from paying profit tax, generated in FEZ due to implementation of investment projects, approved by Myikolayiv oblast administration

7. Profit tax, generated between the 4th and 6th years inclusive from implementation of the investment projects, approved by the oblast state administration, is taxed by the 50% rate of the current taxation rate.

8. Discharge from paying profit tax from a part of the profit, generated by ship-building enterprises, participants of FEZ, if this part of the profit is directed to develop production capacities within the framework of the investment project to be implemented during 10 years, beginning from the 4th year of the project implementation

9. Total discharge from paying land tax for the period of the investment project implementation

10. Revenues in foreign currency generated through sales of products, works and services, produced or rendered within FEZ, are exempt from mandatory selling.

In the process of FEZ development these prioritized types of performance could be specified within the limits of the priorities, indicated by the Article 6 of the Law on FEZ:

• in food processing industry and agricultural products processing;
• in house construction, power generation and transport;
• in machine and instruments building;
• in all types of production performance, related to ship-building.

AGRO-INDUSTRIAL COMPLEX

Agriculture is 2nd by output and 1st by employment industry in the oblast. The area of agricultural grounds is 2.01 mln.ha, out of which cultivated grounds make 1.7 mln. ha.

The structure of agricultural production is vegetation-cattle. The major crops are grains and industrial crops (sun flower, sugar beets), vegetables, melons and gourds. Gardening and wine growing are also well developed.

Vegetation is well developed and fodder crops hold an important proportion in it, which is a good foundation for cattle-breeding, having dairy and meat direction.

TRANSPORTATION INFRASTRUCTURE

In Myikolayiv oblast there is a powerful transportation system, which includes railway, sea, river, automobile, air and pipeline transport.

Within the oblast limits the exploitation length of railways is 700 km., out of which 33.6% are electrified. All the lines mainly provide for transit shipments. On the oblast territory there are 53 railway stations, out of which Myikolayiv, Voznesensk, Pervomaysk-on-Bug, Kolosivka, Snigurivka are the biggest.

Automobile transport plays an important role in inter-city and inner-oblast transportation. Transport highways of Odesa, Kyiv and Crimean directions pass through Mykolayiv. They also make a part of such international through-passages as Euro-Asian and the Black-Sea littoral.

Important high-ways Myikolayiv Odessa Kishinyov, Myikolayiv Simferopol, Myikoayiv Kirovograd etc. pass through the oblast territory. The length of roads for public use is 4.7 thous. km, including 4.6 thous. km with hard cover. The proportion of automobile transport in total volume of goods and passenger transportation reaches 67% and 90.8% correspondingly.

Exploitation length of trolley lines for public use is 59.1km and tram lines 73.2 km.

Geographic position of Myikolayiv oblast, availability of navigable passages all these play an important role to ship goods by the sea and rivers. Therefore, the port infrastructure and its services are a key factor of commercial success and economic development of Myikolayiv oblast.

Navigation through the canal of Dnipro-Bug marshes is carried out by the state enterprise "Delta-Lotsman". Its affiliate ensures navigation from the port "Pivdennyi" (Odessa oblast) to 5 ports of Myikolayiv oblast through the canal of Dnipro-Bug marshes and to the port in Kherson through Kherson sea canal. The company controls the system of traffic regulation, ensures functioning and servicing of the Dnipro-Bug marshes and Kherson sea canals.

Myikolayiv is a powerful sea port not only in the oblast, but also in Ukraine, where 3 sea and one river ports are functioning.

Myikolayiv sea trading port is an important transportation center in the south. The port is connected with the Black sea by Bug-Dnipro marshes canal of 79 km. length and stretching to Ochakiv. The admissible draught in fresh water for that canal is 9.5 m., the admissible ship length is 215 m., its width 30 m. Ships with the length of about 187m are towed along the canal. Navigation goes on all the year round. There are 14 berths in the port with the length of the berth line 3.3 thous. running meters. They have railway connection, almost all of them are located closely to storehouses, which shortens considerably time period for transporting freight between the storehouse and ships, or to the open concrete sites (about 23 thous. sq. m. of roofed sites and 197.3 thous. sq. m. of the open sites). All the berths are equipped with load carrying mechanisms: highly productive gantries with the capacity from 5 to 40 tons, auto and electric loaders from 1.5 to 25 tons, two water cranes with the capacity of 100 t. and 5 t. The port has modern load complexes to process loading freights, like grain or ores.

Sea port "Oktyabrsk" is a specialized port, one of the most advanced in Ukraine. This port is suitable to service ships of "Ro-Ro" type, container ships, ferries. It is equipped with lifting cranes of 40 tons capacity, auto and electric loaders with the capacity of 1.5 t - 25 t. There are 7 deep water berths with the total length of 1.9km. It is navigable all year round, but in winter only certified ice-breakers can navigate there.

Dnipro-Bug sea port is situated at a distance of nearly 14 miles from Myikolayiv on the left bank of the Southrn Bug. This is the only port in Ukraine, which is profiling in unloading bauxite and coal. Annually the total volume of loading-unloading operations reaches approximately 6 mln. ton. The port has 5 berths, the depth of which is 10 meters. There are 12 small ships in the port to perform support operations, like navigation and mooring.

Myikolayiv river port is situated on the bank of the Southern Bug, not far from Myikolayiv sea trading port. The river port occupies 185 thous. sq.m. of the water area of the river South Bug with the berth length 800 running meters. Modern mechanical equipment provides for carrying out works with export-import loads. The port can process up to 6 mln. tons of loads. There are 7 load berths, to which rail ways are provided. It also has 46.6 thous.sq.m. of equipped store-houses. All the load berths have updated equipment: 13 lifting cranes (with the capacity 5-40 tons); auto loaders (capacity 1.5 25 tons); stationery equipment to load sand and granulated loads. The port also carries out passenger trafficking on the local lines and can receive tourist-excursion ships, which make river cruises by the Dnieper, Dunay and to the Crimean ports.

International airport "Myikolayiv" belongs to the largest and technically well equipped airports in the south of Ukraine. It has modern airstrip, and it is equipped with radio-technical, lighting and navigation equipment.

Pipeline transport annually carries 2.1 mln. tons of ammonia through the oblast territory. The length of the ammonia lines is 444 km.

EDUCATION AND SCIENCE

There are 487 permanent kindergartens and 583 comprehensive primary schools, including 7 lyceums and 5 gymnasiums.

The system of vocational training is represented by 28 educational establishments.

About 21655 students get their higher education in 13 higher educational establishments of 3rd and 4th level of certification. Annually nearly 7 thous. specialists graduate from higher educational establishments.

At present 25 higher educational establishments are functioning in the oblast, including 3 universities:

• Ukrainian state sea technical university;
• Myikolayiv state pedagogic universtity;
• Myikolayiv state agricultural academy.

There are 8 affiliates and faculties of the National university "Kievo-Mogyilyanska Academia", Kyiv Slovyansk university, Law institute of Odessa state university, Kyiv state institute of culture, etc.

630 candidates of science, 61 doctors of science, out of which 14 people has the rank of academicians, 2 Corresponding members, 19 professors, are carrying out scientific research.

There are 3 professional theaters in the oblast: Russian drama theater, Ukrainian theater of music drama & comedy, oblast philharmonic society, 577 cultural establishments of a club type, about 150 cinema projectors and 552 libraries, where there are about 10.4 mln. books and magazines. Education of artists is carried out by Kyiv state institute of culture and 49 music and art schools.

RECREATIONAL COMPLEX

Natural-climatic conditions, considerable recreational resources of the oblast provide for the further development of sanatorium and resort branch. The region is characterized by a long warm period with the average air temperature on the sea coast to be more than + 15deg.C.

There are about 120 territories and AONB places, regional landscape parks in the oblast "Kinburnska kosa" and "Granitno-stepove Pobuzhya", part of theBlack sea conservation, nearly 19 parks, etc.

Myikolayiv zoo is considered to be one of the most picturesque in Ukraine. It was founded more than 100 years ago. There are nearly 2,500 animals there of 350 kinds. Myikolayiv zoo, which is part of European association of zoos and aquariums, take an active part in 14 international programs to protect rare fauna reps.

Among oblast major natural recreational resources there are:

• sea sand beaches with the total length of more than 70 km;
• picturesque landscapes of the South Bug banks and numerous artificial lakes;
• spa fountains with the tested exploitation reserves of more than 1 thous.cub.m;
• reserves of medicative mud, specially in Tyipigulskiy and Beikushskiy marshes;
• 11 thous ha of forest are used as a recreational area, including 4 thous. ha of "green areas" around cities.

Resort establishments are located primarily in the resort zones, village Kobleve, towns Ochakiv and Myikolayiv on the Black sea coast and its marshes.