Economics of Odessa - A Simple Primer

Odessa is an industrial centre of the Northern Black Sea region and one of the main economic engines of Ukraine.

Odessa possesses developed industry, various tourist facilities, developed transport, financial and social infrastructure. It has the largest seaport of the Ukraine. Transport and external trade are amongst the main economic functions of Odessa.

Odessa is a major industrial centre of the Ukrainian Black Sea region. The city possesses 146 different industry branches. At present, 5% of the industrial production of Ukraine takes place in the Odessa region.

The economy of Odessa largely stems from its traditional role as a port city. The nearly ice-free port lies near the mouths of the Dnieper, the Southern Bug, the Dniester and the Danube rivers, which provide good links to the hinterland. During the Soviet period (until 1991) the city functioned as the USSR's largest trading port; it continues in a similar role as independent Ukraine's busiest international port.

Cranes in the Odessa Port (Photo by Viktor K.)

The port complex contains an oil and gas transfer and storage facility, a cargo-handling area and a large passenger port. In 2007 the Port of Odessa handled 31,368,000 tonnes of cargo, and while these figures suffered in the post-Maidan period, it is quickly making up lost time after the dust has settled. The port of Odessa is also one of the Ukrainian Navy's most important bases on the Black Sea, and home to the Naval Command Headquarters.

Rail transport is another important sector of the economy in Odessa – largely due to the role it plays in delivering goods and imports to and from the city's port.

In 2015, estimated Total Volume of Products Sold (products and services) was 154,585.9 mln. UAH. The Total Number of Enterprises is 24,676, Large Enterprises comprise 0.1% of that number, with Medium Enterprises making up 4.1% and Small Enterprises filling up the bulk of those enterprises with a share of 95.8% The 7-Kilometer Market is a major commercial complex on the outskirts of the city where many of these small private traders now operate, making it one of the largest market complexes in Eastern Europe.

The market has roughly 6,000 traders and an estimated 150,000 customers per day. Daily sales, according to the Ukrainian periodical Zerkalo Nedeli, were believed to be as high as USD 20 million in 2004. With a staff of 1,200 (mostly guards and janitors), the market is also the region's largest employer. It is owned by local land and agriculture tycoon Viktor A. Dobriansky and three partners of his (from https://en.wikipedia.org/wiki/Odessa#Economy).

Containers in Odessa (Photo by Skhakirov)

The major part of Odessa's industrial production is achieved in food industry, machinery-building and metal-processing, fuel industries, ferrous industry, building materials industry, chemistry and oil chemistry, light and medical industries. Agriculture is a relatively important sector in the territories surrounding the city.

Odessa is situated at the cross-point of important international routes from Europe to Asia, from Central and Northern Europe to the Middle East. The international transport corridor which connects Finland, Latvia, Byelorussia, Ukraine, Moldova, Romania, Bulgaria and Greece, goes through Odessa.

Odessa's seaport, the largest in the country, has cargo handling facilities of 20+ million tons per annum. Its total coastal line is 8 km long and accommodates ships of up to 250 m length  and 12,5 m draft. Transport lines connect the port with more than 600 other ports around the world. The ferry lines connecting Odessa with Turkey and Greece, are under active operation.

Odessa's port is considered to be one of the largest in Europe, and in regards to domestic goods exported, about 85% are shipped to more than 30 countries around the world. It enjoys ratings in the international category and has an active balance of cargo turnover as a multifunctional trade port.

In accordance with the Edict of the President of Ukraine, a free economic zone has been created within the port area where corporate entities enjoy privileges in taxation. In addition, sea transport, railway, car, aviation and pipeline transports are developed in Odessa.

Odessa has an international airport, which is the second busiest in Ukraine and is connected with many cities of Ukraine and Europe as well as Asia and Africa. Reconstruction of the airport in accordance with highest international requirements is currently under way.

Over 900 joint ventures with participation of foreign capital operate now in Odessa.

The Branch of the National Bank of Ukraine, about 30 commercial banks, including their branches, 27 insurance companies and their branches, and the Branch of the Ukrainian Stock Exchange operate in Odessa.

In comparison with other cities of the Ukraine, Odessa has been quick to choose its own way of business activity. Old traditions of Odessa as a trade center of Southern Russia are now receiving their further development with an eye towards EU market integration.

Odessa Region - Index of Industrial Production

The Odessa Guide
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Wednesday, 24 August 2016 00:00
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Last modified on Thursday, 08 February 2018 16:06
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