Ukraine's rocky economy
In just two years, between 2013 and 2015, GDP in Ukraine has been dramatically reduced to half its amount. This very severe decrease is mainly due to the civil war in the eastern part of the country, which is causing many of its inhabitants to be internally displaced, and life in general to become increasingly difficult for Ukrainians - not just because of the war, but because the country’s economy is in desperate trouble: The inflation rate has risen to almost 50 percent, the second highest rate around the world behind Venezuela, and unemployment is now at over 11 percent.
The industrial Donbass region located to the east of the country has also been devastated. Russia, Ukraine’s most important import and export partner until recently, most likely no longer plays this role, having caused a great shift in the country’s base economy. Ukraine’s national debt in relation to GDP is also unsustainable, having increased by over 50 percent in the last two years. Default or restructuring of its debt was inevitable, and eventually restructuring took place in August 2015. While the economy is expected to recover somewhat in 2016, its stability will depend on improving the stability of the country in order to create an environment in which the economy can operate and recover.