RPT-FEATURE-Crisis abruptly ends Ukraine building boom

Tue Dec 30, 2008 10:34am GMT
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By Yuri Kulikov

KIEV, Dec 30 (Reuters) - Dozens of unfinished buildings dot the Kiev skyline, their abandoned hulks embodying the damage that the world's financial crisis has inflicted on Ukraine.

Silent building sites point to the end of a golden era in which construction boomed, only to be replaced by bankruptcies, tens of thousands of job losses and crippling debt repayments for consumers in the former Soviet republic.

Ukraine has secured a $16.4-billion loan from the International Monetary Fund. But its outlook is bleak, with the president and prime minister constantly bickering, a gas row brewing with Russia and signs of public discontent growing.

"Ours is probably the most important, yet deprived, sector. It is, therefore, worst hit by the crisis," said Oleksander Omelchenko, a member of parliament and former mayor of Kiev.

"Forty percent of construction sites have virtually been put on hold. But the authorities just don't understand that halting projects ends up being more expensive than completing them."

The construction sector has, like the vast steel industry, been sent reeling by the economic crisis.

It once provided 1.5 million jobs and drew vast numbers of workers into the prosperous, bustling capital from stagnant hinterlands. An end to affordable credits and a sharp drop in the value of the hryvnia currency has brought an abrupt end to that.

Construction companies say prospects are dire and call on the government to shoulder its share of the blame.  Continued...

 
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