Business

Overview of Crimea’s economy before its annexation into Russia

Posted on by quatest
21
May

Just by glancing at a few numbers, one can imagine the difficulties that Crimea’s economy is facing. But the most serious is the lack of energy and fresh water. According to Russia’s RT television channel, the annual GDP of this autonomous republic is only 4.3 billion USD, equal to 1/500 of the size of the Russian economy.

Regardless of the referendum result, improving Crimea’s poor infrastructure and transport system could be a great investment opportunity for Russian as well as Crimean companies .

Crimea has famous Black Sea resorts

Travel is pointed

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The backbone of Crimea’s economy is currently the tourism industry with a large number of tourists. attracting 6 million people/year during the summer months. But currently 70% of tourists are Ukrainian and only 25% are from Russia. Political tensions between Russia and Ukraine may cause tourists to stop coming here, causing the industry’s revenue to decline by 30% this year.

However, if Crimea becomes part of Russia, this place may become more attractive in the eyes of the Russian people, a large market with 142 million people with an average income per capita 3 times higher than in Ukraine.< /p>

According to the Ukrainian Statistical Office, the average salary of Ukrainians as of February 2014 is 3,184 hryvna/month (331 USD). In Crimea the average salary is only 2,693 hryvna (283 USD) while in Kiev this figure is nearly double 4,783 hryvna (503 USD).

Oil mines and gas

The greatest potential of Crimea’s economy currently lies in the southern region near natural gas fields on the Black Sea. The reserves of these mines are estimated to be very large, with financial news agency Bloomberg estimated to reach an output of 7 million tons/year.

< p>The US company ExxonMobil and the British and Dutch joint venture Shell once discussed with Ukraine about exploratory drilling in deep waters off the country’s coast, but this was hindered by all the oil. which is located in the waters of Crimea. This deal is estimated to be worth 1 billion USD.

Currently, ExxonMobil’s plans in the Black Sea have been postponed, senior vice president Andrew Swiger announced to investors. investors at a meeting in early March.

On Thursday, Crimean authorities took control of oil and gas fields in the Black Sea and Sea of ​​Azov. Chairman of the Crimean parliament Vladimir Konstantinov announced. Mr. Konstantinov also affirmed his support for Russia’s Gazprom company to take over these oil and gas fields.

“Russia and Gazprom should control oil and gas production activities burn. We don’t see any problems,” the RIA Novosti news agency quoted Mr. Konstantinov as saying.

< div style="TEXT-ALIGN:center">Crimeans are looking forward to joining Russia

Singapore by the Black Sea?

Sergey Aksyonov prime minister of Crimea and one supporter of joining Russia hope that separating from Ukraine will help the peninsula’s economy develop better. Aksyonov took Singapore as an example to follow.

“For me Singapore is a model. They used to be a city with 2 million people with an area of ​​more than 600 km2 but with a budget of 46 billion USD. Today Crimea has an area of ​​26,000 km2 2 million people and a budget of only 500 million USD. In my opinion, we can achieve that we can independently solve a lot of problems very quickly, achieve a 3-4 times increase in budget,” Aksyonov declared on the NTV on March 9.

Singapore used to be part of Malaysia with the vast majority of Chinese people living. This region declared independence from Britain in 1963 and after a short period of unification with Malaysia they declared themselves an independent country in 1965. To date this is a commercial and economic center with a growing financial center. the world itself. Previously, this place was only famous as the largest British naval base in South Asia.

Crimea may not have followed such a successful path, but one The option to promote growth is to turn Crimea into a special economic zone – with relaxed tax and financial regulations – to help promote growth and attract foreign investment. In 2005, Russia passed a law allowing the establishment of special economic zones and wanted to establish such an area in the Far East, but to date no special zone has been established.

Thanh Tung
According to RT

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