MODELS OF CHANGES IN UKRAINE'S INTERNATIONAL TRADE RELATIONS DURING THE RUSSIAN-UKRAINIAN WAR
Main Article Content
Abstract
Introduction. In the modern world, there are persistent trends towards strengthening trade relations between countries due to the growing demand for categories of products that cannot be produced locally or from local resources, driven by global economic growth and population migration. This manifests in the intensification of globalization, particularly at the continental level, and the increase in the import and export of vital products and goods by countries. In local markets, trade relations between countries are continuously strengthening, and a similar trend is observed on the global trade map. A contemporary direction in the development of international trade is targeting, where a group of countries identifies the categories of products that are most needed by a particular country or countries within a continent (as seen in the example of agricultural products that Europe sends to African countries).
It is important to note that the Russia-Ukraine war, which can be recognized as a global crisis, has fundamentally altered the structure and dynamics of Ukraine's international trade relations, leading to significant challenges for its economy and corresponding transformations. The loss of traditional markets, the decline in production and export volumes, and the necessity to adapt to new conditions in the global market require the development and implementation of new models of international trade. This necessitates a detailed analysis of changes in Ukraine's trade relations during the war and the formulation of effective strategies to overcome the negative consequences and ensure stable economic development.
Purpose. The article identifies changes in Ukraine's international trade relations considering the impact of Russia's full-scale invasion of Ukraine.
Results. The full-scale invasion by Russia in February 2022 significantly altered Ukraine's trade capabilities, both in terms of production and supply of goods. This study was conducted in order to assess the current trade capabilities of our country at this stage. The article utilizes data from the International Trade Centre website. The research examined the changes in the volume of exports of various groups of goods by European countries and countries around the world, focusing on the impact of the war in Ukraine on the global market, particularly on the position of our country in the European market. It was established that in the period under study, the leaders in sunflower seed exports are Romania, Bulgaria, France, and Hungary. In 2021, there was a significant increase in the volumes of sunflower seeds exported by Ukraine. During 2021-2022, Ukraine emerged as the undisputed leader compared to other exporting countries. The model, constructed using data on sunflower seed export volumes from 2003 to 2021, shows that Ukraine is part of a large cluster alongside the Netherlands, Belgium, Finland, Spain, Latvia, Sweden, and others. The changes in the positioning of countries within the hierarchical tree when considering the 2022 data primarily involve the exchange of neighboring countries' positions, without any significant structural changes in the tree or any substantial shift in the position of any country. This may indicate that the change in Ukraine's sunflower seed export volumes in 2022 is relatively small, meaning that the cultivation of sunflower and changes in the logistics of product delivery have not significantly impacted the exported volumes. The leaders in exporting ferrous metallurgy products are Germany and Italy, with all other countries maintaining nearly unchanged export volumes. However, since 2020, Poland, Spain, France, Austria, and the Czech Republic have increased their exports of ferrous metallurgy products. The modeling results indicate that from 2003 to 2021, Ukraine was part of a cluster of closely connected countries, including Germany, Italy, Spain, Belgium, France, and the Netherlands. When adding data for 2022, significant changes in Ukraine's position are observed: Ukraine's intra- and inter-cluster connections have become very weak, placing it in a cluster of the weakest-linked countries. This shift in the hierarchical tree indicates major changes in the country's actual exports. Indeed, due to the inability to fully produce products at pre-war volumes and ship them to international partners, metallurgical enterprises have drastically reduced production, with an increasing share of products being directed toward domestic needs. Thus, two different results have been obtained. The first result pertains to products that were supplied in volumes comparable to those of other countries and for which changes in logistics did not have a significant impact. In this regard, Ukraine's position in the hierarchical tree changed significantly due to substantial changes in export volumes. The second result concerns strategic products for our country that are vital to other nations and were supplied in large volumes. In this regard, Ukraine's position in the tree remained almost unchanged, as did the export volumes.
Originality. The study was conducted using the construction and analysis of minimum spanning trees and hierarchical trees based on real data from the period 2003-2022. This approach allows for an assessment of changes in Ukraine's position in the global and European markets for the respective products, taking into account the onset of Russian aggression.
Conclusion. The results of modeling and analysis indicate changes in Ukraine's trade relations concerning strategic groups of goods for our country. These changes have been caused by the onset of the war in Ukraine. We believe that in order to enhance the status of our country in the international market amidst globalization, integration into the EU, and the changes caused by the war, Ukraine needs to adopt a comprehensive approach in developing its foreign trade policy. Firstly, Ukraine needs to modernize the transport and logistics infrastructure. Secondly, Ukraine should intensify its participation in European trade initiatives and programs, which will contribute to expanding exports. It is important to diversify export positions and enter new markets. This approach will reduce Ukraine's dependence on traditional partners and strengthen the country's international position. It is necessary to lobby for national interests within the framework of international trade organizations, enlisting the support of partner countries for the purpose of integration into the EU. Scientific research using modeling will allow these approaches to be implemented in the most optimal way.
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