Imports of Ukraine in Jan-Feb 2010, Ukrstat

As usual, fossil fuels and natural gas take 36 percent of all Ukrainian exports. It is really a shame, taking into account huge territory, large than France or Poland. Really, what are the chances there is no oil and gas hidden somewhere in Ukraine?

Construction materials are on the rise, growing 376 percent. It is a good sign of economic recovery

Umbrellas are the hottest Ukrainian exports

Umbrellas are the hottest Ukrainian exports , growing 8966%  relative to the same period of 2009

Source: Ukrstat

Level of protectionism is rising

According to the Global Trade Alert, Basic metals and basic chemicals are two industries most affected by the protectionist measures. These are two industries in which Ukraine exports the most.
The top three countries that have the most protectionist measures imposed are Russia, India, and US. However, the EU would come first if one include groups of countries.
In terms of product lines that are affected, the top three countries are Russia, Ukraine, and China.

Raising import tariffs is a really bad policy

Responding to this:

http://www.kyivpost.com/business/bus_focus/45805

It would immediately hurt consumers – all 46 million people who live in Ukraine – because they would have fewer products at higher prices.

It would further worsen situation with corruption – domestic producers will attempt to influence the decision of policymakers on which sectors to protect, importers will try to avoid paying import duties.

It would cause a reciprocal response from foreigners who will put trade restrictions on our products and hurt our exporters.

Import substitution policy involves immediate costs and requires a long term strategy and coordinated efforts from all political parties for benefits to materialize: when new political leaders replace the old ones, policy should not be changed and I really doubt the ability of our leader to coordinate their efforts.

Imported products that replace local ones are not the cause of domestic economic problems. When people buy a car or computer they care the most about its quality and price and much less about its origin. The very unpleasant fact for local producers is that foreign companies offer better products at lower price.

There are many reasons why Ukrainian firms are far behind in the global race for consumers. One of the major obstacles to doing business in Ukraine is poor investment climate, anti-market regulations, widespread corruption, and almost no respect for the rule of law. Will the policy of import substitution resolve these issues? No, I am afraid it will make things worse.

Improving the investment climate and opportunities for doing business in Ukraine would be a daring task even for a benevolent ruler who cares about common people. Unfortunately, only a very naïve person would describe our politicians using words “benevolent” or “caring”. In current circumstances, the best policy for common people is if our leaders stay away from economics and focus on their political fights.