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Overview of Ternopil Oblast Ternopil oblast covers an area of 13.8 thousand square km, which makes 2.3% of the territory of Ukraine. The population is approx. 1.164 million,or 2.3% from the total population of Ukraine. The average density of the population is 84 persons per 1 square km that almost equals to the average index of the country in general. The majority of the population in Ternopil oblast lives in the villages (56%). Ternopil oblast is divided into 17 administrative districts. There are 16 cities, 19 of urban-type settlements and 1013 villages. The administrative centre of the oblast is the city of Ternopil with about 235,000 inhabitants.

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

The oblast 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 oblast is temperately continental with warm, damp summer and gentle winter. Average temperatures range from -5° Centigrade in January to +19°C in July. Average annual precipitation is 520-600 mm.

Ternopil oblast is a developed agricultural and industrial area of Ukraine. Significant natural and manpower resources, the concentration of processing industry (sugar, alcohol, canned vegetables and fruit), geographical location at the crossing-point of important transport routes from the Eastern to the Central and Western Europe mark the oblast out 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 Ternopil oblast. Because of the lack of investment resources in Ukraine, Ternopil oblast 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.

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

Ternopil oblast in context of the history of Ukraine.

Ternopil oblast, along with the Lviv and Ivano-Frankivsk oblasts, is a part of historical territory, named Galicia. This Western-Ukrainian oblast due to some political events in the 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, singling it out by keeping the language and cultural traditions, religion and national identity.

The Ternopil oblast – is an ancient area of pre-Slavic settlements. The traces of existence of human beings on this territory go back to the era of the early paleolith (over 100,000 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 – Kievan 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 Galicia-Volhynia 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 Dniester 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, 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: the Mongol and Tatar invasion in the 13th c. and the Pereyaslav treaty of 1654 with Moscow. These events influenced the 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 Dnieper 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 Galicia.

The Mongol and Tatar invasion greatly influenced the geographic distribution of commerce. The commercial relations between Prydniprovia (the territory near the Dnieper) 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 Dniester river substituted the Dnieper river as the main commercial artery between Ukrainian lands and the Black Sea. Galician 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 relations 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 distilleries and breweries (in 1910 their number increased to 390) operated on the present territory of Ternopil oblast. Some slaughter-houses 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 fewer persons. The railway route building which started at the end of the 19th century was of great importance for the economic development of the oblast. In 1939 on the territory of the Ternopil oblast there were 1700 enterprises, employing 8800 workers.

Having survived the ruins of the Second World War, the Ternopil oblast 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 Ternopil became one of the industrial and cultural centres of Ukraine.

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

Land resources

Land resources are the main treasures of Ternopil oblast. 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 ground resources is rather high. Of the general area of ground fund, which makes 1382,4 thousand hectares, 85% constitute the grounds, which are used for providing agricultural business. The main part of these grounds 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 Ternopil oblast makes about $2.6 billion.

Forest resources

Forests cover about 14% of the oblast's 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 oblast mixed woods prevail.

Opportunities for industrial use of oblast's forest resources are small, because of the insignificant density of forests on the territory and qualitative 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.

Ternopil oblast 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 oblast 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 oblast makes non-ore 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 Ternopil oblast (bed thickness of which is 18-30 m, and the depth of occurance is 15-20 m) which is considered as high-quality raw material for manufacture of cement. But the industrial use of mergel in the oblast is insignificant.

Practically in all parts of the oblast 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 occurance of layers does not exceed 7 m) are good raw base for brick-tile manufacturing. In the Northern and central parts of the oblast there are also deposits of fire-clay and argil (potter’s clay) which are used for tile and pottery manufacture.

The oblast possesses the large stocks of building stone, dolomits and sandstones. 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 oblast, 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 to extract 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 oblast’s territory are valued by the dozens of million tonnes. In general, more than 20 deposits of it are known, the thickness of layers of which is about 20-25 m. By the occurance 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 Ternopil oblast. About 50 deposits are known in amount of about 7.7 million tonnes of peat.

Among the non-ore economic minerals, the phosphoritus can be found in small amounts on the territory of the oblast, which are used as mineral fertilizer, 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 oblast (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, guest-houses are at tourists’ disposal.

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

Ternopil oblast 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 coal field and industrial area of Prykarpattia) also contributes to the development of different branches of industrial production. The oblast's location in the area with high population density determines the prevailing of labor consuming branches of economy.

General characteristics of economy.

In April 2000, there were 37 state-owned industrial enterprises, 378 joint-stock companies, 1350 companies, 789 limited companies, 72 co-operatives, 505 agricultural enterprises (5 of them state-owned) and 805 country-farmer’s enterprises.

The most important industries include:

- food processing (49% of general volume of the industrial production in 1995);

- machine-building and metal processing (20%);

- light industry (6%);

- the industry of building materials (4%).

Food processing industry is the leading one in the oblast. 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 oblast), concerning the production amount and realization of products. Together with alcohol and tinned vegetables they are the branches of industry in which Ternopil oblast is considered to be specialized on the state and local levels of labor division.

Out of the general volume of industrial production 88% falls to the non-state-owned enterprises in economic sector.

The range of business entities operating in the main industrial sectors is given in the list of 45 biggest companies with the definitions of their activity. The list does not include the enterprises of fuel-energy complex.

1. Joint-stock company "Kombine plant" – machines for agriculture, beet-gathering machines, spare parts for the automobiles.

tel. (0352) 224703, 228037

1. Plant "Saturn" – satellite aerials, spare parts for automobiles.

tel. (0352) 220690

2. Plant "Orion" – radio sets, TV antennas, acoustic systems, amplifiers.

tel. (0352) 244007, 243014

3. Plant "Mikron" – radio sets, amplifiers, TV aerials.

tel. (03548) 21824, 21588

4. Buchach plant "Astron" – metal products.

tel. (03544) 22777, 21235, 22131

5. Buchach plant "Kvant" – metal products.

tel. (03544) 26519, 26722

6. Plant "Orgosnastka" – metal products.

tel. (0352) 223071, 251506

7. Specialized enterprise "Alfa" LTD – gas apparatus and equipment.

tel. (0352) 220980

8. VO "Ternopillis" – furniture, wood products.

tel. (0352) 223563, 252416

9. Ternopil furniture factory – furniture.

tel. (0352) 259496

10. "Technotern" LTD – furniture, parquet, wooden tiles, veneer

tel. (0352) 252784

11. Joint-stock company "Vatra" – light-fitting equipment.

tel. (0352) 225210, 278715

12. VO "Texterno" – cotton materials, cotton yarn.

tel. (0352) 226123, 225252

13. Porceliain plant – china utensils and faience (or glassed pottery).

tel. (0352) 250948

14. Plant "Kvantor" – calculators, electronic watches.

tel. (03550) 21532

15. Berezhany glass plant – glass utensils .

tel. (03548) 21253, 22508

16. Joint-stock company "Kremenets fabryka "Vatin" – non-weaving materials of the kind of fabric, wadding.

tel. (03546) 23021, 26636

17. Joint-stock company of artificial leather "Vinitex" – leather products, linoleum.

tel. (0352) 224273, 225054

18. Terebovlia shoe factory – leather shoes.

tel. (03551) 21353, 21537

19. Joint venture "Billerbeck-Ukraine" – articles made of down and feathers.

tel. (03552) 23268, 22026

20. Ternopil sewing factory – sewing goods.

tel. (0352) 223630

21. Terebovlia factory of Christmas tree decorations – Christmas tree toys and decorations.

tel. (0352) 21862, 21247

22. Skalat factory "Lotos" – domestic chemistry, bleacher, washing powders, cleaning devices.

tel. (03543) 31687

23. Joint venture "Global Cosmed" – shampoo, washing powder and devices.

tel. (03552) 22301

24. Ternopil meat products plant – meat, sausages.

tel. (0352) 221082, 224419

25. Chortkiv meat products plant – meat, sausages and convenience foods.

tel. (03552) 23127, 23377

26. Berezhany macaroni factory  – macaroni.

tel. (03548) 22414, 21012

27. Zalishchyky plant of tinned products  – tinned vegetables.

tel. (03557) 21831, 21085

28. Berezhany plant of tinned products  – tinned vegetables.

tel. (03548) 21010, 21020

29. Chortkiv plant of strong drinks – alcohol, strong drinks .

tel. (03552) 22880, 22580

30. Kolyndiany concentrate-yeast products plant – yeast, food concentrates.

tel. (03552) 55642, 55618

31. VO "Ternopil spirt" – alcohol, strong drinks, mineral water, confectionery, mayonnaise.

tel. (0352) 222413, 229671

32. Oblast's commercial-producing firm "Kharchoprom" – soft drinks, confectionery, tinned vegetables, breads, mineral water, sausages, mayonnaise, wine, liqueur-vodka products.

tel. (0352) 224690, 224451

33. VO "Ternopilelevatorzernoprom" – flour, cereals.

tel. (0352) 222520, 227990

34. VO of the dairy industry – butter, cheese, production made of the condensed milk, casein.

тел. (0352) 250680, 252844

35. Lanivtzi plant "Prolisok" – butter, casein.

tel. (03549) 21108, 21496

36. Chortkiv confectionery factory – confectionery.

tel. (03552) 22639, 22402

37. Ternopil confectionery factory – confectionery.

tel. (0352) 224438, 254583

38. Monastyrysk tobacco plant – cigarettes.

tel. (03555) 21404, 21704

39. Pharmaceutic factory – medicine, medical products.

tel. (0352) 255933, 229147

40. Velykoberezovytsky products plant "Budindustria" – collected metal-concrete constructions.
tel. (0352) 225469, 226506

41. Producing-locational self-governing company of building materials – bricks.

tel. (0352) 222385, 225500, 228633

42. Joint venture "Volchontet-Banchi LTD"  – tiles, granite slabs, building materials, confectionery.

tel. (0352) 282084

43. Ternopil beer plant "Opillia" – beer.

tel. (0352) 259659, 251752, 259657

44. Mykulyntsi beer plant "Brovar" – beer.

tel. (03551) 51442, 51152

According to national standards the transport network in the oblast 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 tons of cargo annually). The length of oblast's roads amounts to approximately 5.1 thousand km, when 5.0 thousand km comprise the roads with fixed and steady covering. 370 km of the automobile roads fall per each 1 thousand square km of the oblast's territory, including 362 km of the road with fixed and steady covering.

The oblast's railway system comprises 575 km, the density of the railway network makes 41.4 km per each 1 thousand square km, which exceeds the same index in Ukraine (37.6). Every year the railway transport carries approximately 0.7 million tons of cargo and 8 million passengers.

In the oblast the retail network is well developed, which is in private ownership for 80% and includes almost 700 universal and specialized stores and shops. But the wholesale system in the oblast is not properly organized yet. This sector strongly needs more investments, and especially the usage of modern technology and experts for regulation of modern and stable interrelations between the producers, retail and wholesale.

Overall, the distribution system has undergone significant changes in recent years. It has become more effective and responsive to market demands, but still lacks clear structures. Taking into consideration this fact you are strongly advised to contact and consult a local Chamber of Commerce and Industry or the League of Businessmen of Ternopil oblast, concerning the questions of trade relations, searching the business partners for carrying out the commercial operations, etc.

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

Through contact with the League of Businessmen of Ternopil oblast it is possible to find reliable business partners, to get acquainted with the business environment in the oblast, to receive the necessary support in practical realization of business projects.

Foreign economic activity

In 1999, 239 oblast's enterprises carried out export operations and 280 enterprises brought about the import transactions. The foreign trade turnover of the oblast's enterprises and organizations (disregarding the centralized import of oil and gas) during 1999 amounted to 75.3 million US dollars, including export – 43.3 million US dollars, import – 32.0 million US dollars. The favorable balance of foreign trade reached 11.3 million US dollars.

The export and import deliveries tie Ternopil oblast with 57 countries of the world. The main trade partners of the oblast are: Russian Federation (29% of foreign trade turnover for the year of 1999), Germany (19%), and Turkmenistan (5%).

The main external sales markets for the production exported from Ternopil oblast are Russian Federation (40.8% of the total export volume in 1999), Germany (12.0%), Turkmenistan (8.3%), Moldova (5.1%), Poland (3.8%), India (3.4%).

Owing to the peculiarities of the oblast's economy specialization the production of agriculture and food processing industry prevails in the export deliveries structure, namely: meat and meatproducts, sugar, confectionery, tinned vegetables, soft and strong drinks, etc. About 43% of the general export fall on the mentioned production. Among other exported goods, 14% make the textiles, 20% – the production of machine-engineering, 6% – the timber industry production, 17% – production of other branches of industry.

Among the important production suppliers prevail: Germany (29.5% of the general import volume in 1999), USA (14.9%), Russia (12.6%), Poland (9.3%), Belarus (5.7%).

The main kinds of products imported to the oblast are:, machines and electric equipment (23.6% of the general volume of imported stuff), production of chemical industry (16.3%), base metals and the articles made of them (7.7%), cotton (4.7%), transport means (3.0%) and other goods.

By the date of May the 1st, 2000, the volume of foreign investment in the economy of Ternopil oblast amounted to 18,7 millions USD. There are 231 joint enterprises (together with the foreign partner) successfully operating in the oblast, among which 52 Ukrainian-Polish, 43 Ukrainian-Russian and 38 Ukrainian-German, that constitutes the largest numbers.