Challenges and Hopes
Edited By Viktor Stepanenko and Yaroslav Pylynskyi
Ukraine’s Economy: Current Challenges
My purpose in this paper is to characterize the state of Ukraine’s economy, which is currently in very unfavorable situation due to a variety of reasons, including the irresponsible policy of the previous government, foreign intervention, the unforeseen cost of the military conflict, a trade war with Russia and other negative factors. However, describing the country’s economic hardship is not particularly difficult. The main problem is how to overcome these negative trends. And here there is no formula other than the imperative of undertaking through tough and unpopular reforms and hard work. Although in order to make responsible decisions, we should realistically know where we stand in terms of the main economic indicators.
Indeed, Ukraine’s economy is going through difficult times. Already beset by chronic problems (lack of fundamental reforms and optimal structuring of industries, overregulation of the economy, an unfavourable investment climate, excessive energy consumption in production and the public sector as well as widespread corruption in economic relations), it is now facing additional challenges such as the loss of traditional markets for domestic products, the steep increase of Russian gas prices and complete cessation of its delivery in June 2014, lower demand and prices for primary export goods, the breakup of logistics chains, cutbacks to the means of financing the economy, a reduction in foreign investments (which were by no means significant in the first place), rapid devaluation of the hryvnia, the Russian annexation of Crimea and the undeclared hybrid war in the east,...
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