OLD INDUSTRIAL REGIONS OF UKRAINE: PROBLEMS AND TRENDS OF CONTEMPORARY DEVELOPMENT (ON THE CASES OF DONETSK AND LUHANSK OBLASTS)

Abstract

Old industrial regions are the areas of concentration of numerous problems. Donetsk and Luhansk oblasts with their economic profile formed at the turn of the XIX-XX centuries belong to such type of territories. The main purpose of this study is the analysis of the development features, the search for the mechanisms to revitalise the regions of eastern Ukraine, especially after the beginning of the armed conflict in 2014. The development problems of the old industrial regions of Donbas are addressed in the article on the basis of in-depth statistical analysis and modern conceptual approaches to the reform of such territories. The study found that by the beginning of the armed conflict, the development path of Donetsk and Luhansk oblasts were typical of the old industrial regions. Due to the uneven extent of occupation of the economic potential, the regions of eastern Ukraine reacted differently to the events of 2014. Based on the analysis of the dynamics of macroeconomic indicators, the structure of the economy and investments, the article proves that currently Donetsk oblast has almost retained the main trends of previous development. However, the part of Luhansk oblast controlled by the government of Ukraine is gradually turning into an agro-industrial region and losing the features of the old industrial region. The recovery of the old industrial regions of Donbas should be based on real reindustrialization and post-industrialization, should include measures aimed at human capital development (change of mentality, overcoming paternalistic approaches, intensification of entrepreneurial activity) and the formation of a favourable business climate. The main tasks for Luhansk oblast now are overcoming regional disparities, logistical alienation of the northern districts and integration of the territory on new economic ties. The scientific novelty of the research lies in defining the features of the transformation of Donetsk and Luhansk oblasts economic landscape since the beginning of the armed conflict, substantiating the most relevant approaches to reforming the old industrial regions of Donbas.