This paper investigates patterns and determinants of growth in Ukraine in a medium-term and a long-term perspective. During 2000-2008, high growth in Ukraine was sup-ported by favourable external conditions and was mainly demand-driven. Due to the massive decline of external demand and the reversal of capital flows during the global financial crisis some factors that have underpinned growth since 2000 have been ex-hausted. The terms of trade have already deteriorated and foreign credits granted to households and enterprises, which fuelled the consumption boom, have already strongly declined In addition to capital deepening, long-term growth will therefore require maintaining robust total factor productivity, i.e. transfer of technology and efficient allocation of resources. Poor economic and political framework conditions are the main development barriers in Ukraine. Implicit and explicit subsidies, excessive state ownership, corrup-tion, weak competition and high levels of regulatory uncertainty constitute the principal obstacles to an increase of the level and efficiency of investment. The paper suggests some main areas of reforms to overcome these obstacles.
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