Ukraine's land is the building blocks of its economy. This highly fertile, mineral riched and land full of large mines provides hundreds of billions dollars aid to Ukraine economy. Now when Russia is taking over these valuable provinces, it's clearly trillions dollars gain for Russia.
As the great recession reached the Ukraine, economy of the Ukraine takes the exponential growth. In that rise in economy large export of agricultural products, metallurgy and the machinery played the key role. During this period Ukraine was an important exporter of these goods for over 217 countries.
Metallurgy ($8.8 billion), equipment ($4.1 billion), and food and other agricultural items ($13 billion) made up the majority of Ukraine's exports to partners in trade from 217 nations in 2015. In 2015, Ukraine's imports were down 31.1% to $37.502 billion while its exports were down 29.3% to $38.135 billion. Nearly 50% of Ukraine's exports in 2017 were from the agricultural and food sectors, followed by metallurgy at slightly more than 20% and machine building items at just under 10%.
Tree-map representation of Ukraine exports, 2019
Ukraine is renowned for being a pioneer in agriculture. But as a mother lode for raw materials, it is the location of 117 of the 120 most extensively used minerals and metals as well as a significant supply of fossil fuels. The government removed the geolocations of these deposits from official websites in the early spring, citing national security.
However, SecDev's analysis shows that at least $12.4 trillion in energy reserves, metals, and minerals from Ukraine are currently in Russian hands. The 2,209 deposits that the company evaluated total roughly half that amount in dollars. Along with 63 percent of the nation's coal reserves, Moscow has also taken control of 11 percent of its oil reserves, 20 percent of its natural gas reserves, 42 percent of its metals, and 33 percent of its rare earth and other vital mineral deposits, including lithium.
Wheat production map of Ukraine
Some of such deposits are difficult to access or need further investigation to determine their potential. Some were engulfed either by Russia's 2014 annexation of Crimea or the eight-year conflict between the Ukrainian government and insurgents backed by Russia in the east. But the Kremlin has progressively increased its holdings since the invasion started in February. The following resources have been taken, according to SecDev and executives from the Ukrainian mining and steel industries: 41 coal fields, 27 natural gas sites, 14 propane sites, 9 oil fields, 6 iron ore deposits, 2 titanium ore sites, 2 zirconium sites, 1 strontium site, 1 lithium site, 1 uranium site, 1 gold deposit, and a sizable limestone quarry that was once used to make Ukrainian steel.
Industry and mining centers in Ukraine
The government is still evaluating the impact of the war on its mineral resources, according to Roman Opimakh, director general of the Ukrainian Geological Survey. But he asserted that the value of lost reserves exceeds the sum determined by the independent analysis given how much of Ukraine's raw materials are in the east and south. Resources that we currently employ to support our industrial activity and produce electricity are a negative asset that we have lost, he said. "However, there's another dimension of future minerals that are still underground. Unfortunately, there is a chance that the development of those resources won't assist the Ukrainian people.
Thermal coal mining in Ukraine
The majority of the nation's oil and gas reserves are still in its possession. However, Russia's increased territorial grab in Ukraine is a tactical loss for Western Europe. According to SecDev co-founder Robert Muggah, "Russia's takeover of Ukrainian land has clear repercussions for Western energy security." The Europeans will continue to be heavily reliant on Russian hydrocarbons unless they can quickly diversify their oil and gas supplies.
The future of Ukraine is the biggest threat. Critical Western investment in the energy and mining sectors was scared away during the 2014 Russian invasion, which cost Ukraine around 7% of its land mass. The current conflict has had a similar effect. For instance, an Australian mining corporation and the Polish-Ukrainian investment firm Millstone & Co. signed a 2021 agreement for active exploration at two unexplored lithium sites. According to Millstone managing partner Mykhailo Zhernov, the corporations put their plans on hold as the war broke out.
Mining in the Ukraine
One location—a deposit surrounded by farmland—is currently so close to the war lines that Zhernov is unsure whether it is in Russian or Ukrainian hands. Also abandoned were initial intentions to erect a lithium battery manufacturing there. Analysts claim that as investors doubt the sustainability of extraction, licenses for further mineral resources that the Ukrainian government auctioned last year are currently trading at significant discounts. According to Zhernov, "Ukrainians are losing their economy every day." "I am aware of numerous investors who began geology study but later abandoned it due to the war. Everything is now a bet.
The loss to Ukraine is far greater as a result of Russia seizing important Ukrainian ports and enforcing a broad Black Sea embargo. As other nations transition to cleaner energy sources, some analysts believe that the lost marine transport routes are more important than the lost resource deposits, notably coal, despite its current value. Anders Aslund, an economist who has extensively studied Ukraine, stated that "raw commodities like coal are not the future, they're the past." "I don't think Ukraine will lose its ports, but the bigger question is if they do. They would have to construct an entirely new export infrastructure if they didn't have those ports.
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