The Impact of Trade and Economic Relations Between Ukraine and the European Union on the Competitiveness of Domestic Business Entities
Zvarych I. T., Zvarych O. I.

Zvarych, Ihor T., and Zvarych, Olena I. (2023) “The Impact of Trade and Economic Relations Between Ukraine and the European Union on the Competitiveness of Domestic Business Entities.” The Problems of Economy 2:16–23.
https://doi.org/10.32983/2222-0712-2023-2-16-23

Section: World economy and international relations

UDC 338.43:339.56.55(477):061.1ЄС

Abstract:
The article highlights the impact of trade and economic relations between Ukraine and the European Union on the competitiveness of domestic companies. At this, using the system and synergistic approaches, methods of analysis and synthesis, induction and deduction, historical, comparative, comparative and content analysis, it was found that relations between them began in December 1991, when the Minister of Foreign Affairs of the Netherlands, as the EU presidency, in a letter on his behalf officially recognized Ukraine’s independence, whose policy of building long-term relations is carried out on the basis of the Law of Ukraine of July 1, 2010 «On the Principles of Domestic and Foreign Policy», according to the provisions of Article 11 of which «... ensuring Ukraine’s integration into the European political, economic and legal space» is one of the defining principles of our country’s foreign policy. As a result of the introduction of the Free Trade Area between Ukraine and the EU, our country received trade preferences in the form of duty-free tariff quotas for 36 types of goods, four types of which were set additional volumes of their supply to European markets. At the same time, despite exceptionally unfavorable economic circumstances, the commodity structure of Ukraine’s exports to the European Union remains generally stable. About a third of it is occupied by agricultural and food industry products, in second place – ferrous metals and products from them, in third – electrical and mechanical machines. As for services, the structure of their exports, along with the processing of various material resources, is dominated primarily by information-communication and transport services. At the same time, in 2020, the part of the European Union countries in Ukraine’s foreign trade amounted to 40.7 %, therefore, it avoided such a humiliating status as a raw material appendage of the European Union and became its full-fledged partner in trade in goods and services. Further, at the end of 2022, the total volume of goods from Ukraine to the European Union increased by 4.2% compared to 2021 and reached more than $ 28 billion. The article substantiates that, in addition to foreign trade, the competitiveness of domestic enterprises is influenced by other factors, requiring the appropriate potential, the presence of which enables one or another business entity in the process of its production, commercial or other activities to create appropriate competitive advantages, which, in turn, ensures an increase in their competitiveness. Taking this into account is extremely important for further expansion of production by enterprises and, on this basis, increasing their profits in order to direct them to improving the welfare of workers and their families, which is especially important in the context of Ukraine’s consistent integration into the European Union.

Keywords: the State, European Union, competitiveness (capability), competitiveness and advantage, «national rhombus».

Fig.: 2. Bibl.: 32.

Zvarych Ihor T. – Doctor of Sciences (Politics), Professor, Professor, Department of Management and Marketing, Precarpathian National University named after V. Stefanyk (57 Shevchenka Str., Ivano-Frankіvsk, 76018, Ukraine)
Email: Zvarych2810@gmail.com
Zvarych Olena I. – Doctor of Sciences (Economics), Associate Professor, Professor, Department of Accounting and Taxation, Precarpathian National University named after V. Stefanyk (57 Shevchenka Str., Ivano-Frankіvsk, 76018, Ukraine)
Email: lena_zl@ukr.net

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