Economic overview Ukraine, in 34 editions.

Because of its size, geographic location, Slavic population, and rich
resources, the loss of Ukraine was the final and most bitter blow to the
Soviet leaders wishing to preserve some semblance of the old political,
military, and economic power of the USSR. After Russia, the Ukrainian
republic was far and away the most important
economic component of the
former Soviet Union producing more than three
times the output of the
next-ranking republic. Its fertile black soil
generated more than one fourth
of Soviet agricultural output, and its farms
provided substantial quantities
of meat, milk, grain and vegetables to other
republics. Likewise, its
well-developed and diversified heavy industry
supplied equipment and raw
materials to industrial and mining sites in other
regions of the former USSR. In
early 1992 the continued wholesale disruption of Ukrainian government liberalized
most prices and erected a legal framework for privatizing state enterprises
while retaining many central economic ties controls and continuing subsidies to
state production enterprises. In November 1992 the lack new Prime Minister KUCHMA
of an institutional structure necessary launched a new economic reform program promising more freedom to formulate the
agricultural sector, faster privatization of small and implement economic medium enterprises,
reforms and stricter control over state subsidies. Even so, the magnitude of the
problems and the slow pace in building new market-oriented institutions
preclude a near-term recovery of output. output to the 1990 level.

After Russia, the Ukrainian republic was far and away the most important
important economic component of the former Soviet Union producing more
than three
times the output of the next-ranking republic. Its fertile
black soil
generated more than one fourth one-fourth of Soviet agricultural
output, and its farms
provided substantial quantities of meat, milk,
grain and vegetables to other
republics. Likewise, its well-developed and diversified
heavy industry
supplied equipment and raw materials to industrial and
mining sites in other
regions of the former USSR. In 1992 the
Ukrainian government Government liberalized
most prices and erected a legal
framework for privatizing state enterprises
while retaining many
central economic controls and continuing subsidies to
state production
enterprises. In November 1992 the new Prime Minister KUCHMA
launched a
new economic reform program promising more freedom to the
agricultural
sector, faster privatization of small and medium enterprises,
and
stricter control over state subsidies. In 1993, however, severe
internal political disputes over the scope and pace of economic reform
and payment arrears on energy imports have led to further declines in
output, and inflation of 50% or more per month by the last quarter. In
first quarter 1994, national income and industrial output were less
than two-thirds the first quarter 1993 figures, according to official
statistics. At the same time an increasing number of people are
developing small private businesses and exploiting opportunities in
non-official markets. Even so, the magnitude of the
problems and the
slow pace in building new market-oriented institutions
preclude a
near-term recovery of output to the 1990 level. A vital economic
concern in 1994 will continue to be Russia's decisions on the prices
and quantities of oil and gas to be shipped to the Ukraine.

After Russia, the Ukrainian republic was far and away the most
most important economic component of the former Soviet Union Union,
producing more
than three times the output of the next-ranking
republic. Its fertile
black soil generated more than one-fourth of
Soviet agricultural
output, and its farms provided substantial
quantities of meat, milk,
grain grain, and vegetables to other republics.
Likewise, its diversified
heavy industry supplied equipment and raw
materials to industrial and
mining sites in other regions of the
former USSR. In 1992 early 1992, the
Ukrainian Government government liberalized most
prices and erected a legal
framework for privatizing state enterprises while retaining many privatization, but widespread
central economic controls and continuing subsidies resistance to state production
enterprises. In November 1992 the new Prime Minister KUCHMA launched a
new economic reform program promising more freedom to within the agricultural
sector, faster privatization of small and medium enterprises, government and
stricter control over state subsidies. In 1993, however, severe
internal political disputes over the scope and pace of economic reform legislature soon
stalled reform efforts and payment arrears on energy imports have led to further declines some backtracking. Loose monetary
and fiscal policies pushed inflation to hyperinflationary levels in
output, late 1993. Greater monetary and fiscal restraint lowered inflation of 50% or more per month by the last quarter. In in
first quarter 1994, national income and but also contributed to an accelerated decline in industrial output were less
than two-thirds the first quarter 1993 figures, according to official output. Since his election in July 1994, President KUCHMA has
statistics. At the same time an increasing number of people are developed - and parliament has approved - a comprehensive economic
developing small private businesses reform program, maintained financial discipline, and exploiting opportunities in reduced state
non-official markets. Even so, the magnitude of controls over prices, the problems exchange rate, and the
slow pace in building new market-oriented institutions preclude a foreign trade.
near-term recovery Implementation of output to the 1990 level. A vital KUCHMA's economic
concern in 1994 agenda will continue to be Russia's decisions on the prices encounter considerable
resistance from parliament, entrenched bureaucrats, and quantities of oil industrial
interests and gas will contribute to be shipped further declines in output and rising
unemployment which will sorely test the government's ability to stay
the Ukraine. course on reform in 1995.

After Russia, the Ukrainian republic was far
and away the
most important economic component of the former Soviet Union,
Union, producing more than three about four times the output of the next-ranking
republic. Its fertile black soil generated more than one-fourth of
Soviet agricultural output, and its farms provided substantial
quantities of meat, milk, grain, and vegetables to other republics.
Likewise, its diversified heavy industry supplied equipment and raw
materials to industrial and mining sites in other regions of the
former USSR. In early 1992, the Ukrainian government Government liberalized most
most prices and erected a legal framework for privatization, but widespread
widespread resistance to reform within the government and the
legislature soon
stalled reform efforts and led to some
backtracking. Loose monetary
and fiscal policies pushed inflation to
hyperinflationary levels in
late 1993. Greater monetary and fiscal restraint lowered inflation in
1994, but also contributed to an accelerated decline in industrial
output. Since his election in July
1994, President KUCHMA has
developed - and parliament has approved - a comprehensive economic
reform
program, maintained financial discipline, and reduced state removed almost all
controls over prices, the exchange rate, prices and foreign trade.
Implementation of KUCHMA's
economic agenda will encounter is encountering considerable
resistance from
parliament, entrenched bureaucrats, and industrial interests.
interests and will contribute to further declines However, should KUCHMA succeed in output and rising implementing aggressive market
unemployment which will sorely test reforms during 1996, the government's ability to stay economy may stabilize and possibly achieve
the course on reform real growth in 1995. the range of 0.5%-1%.

After Russia, the Ukrainian republic was far
and
away the most important economic component of the former Soviet
Union,
producing about four times the output of the next-ranking
republic.
Its fertile black soil generated more than one-fourth of
Soviet
agricultural output, and its farms provided substantial
quantities of
meat, milk, grain, and vegetables to other republics.
Likewise, its
diversified heavy industry supplied equipment and raw
materials to
industrial and mining sites in other regions of the
former USSR. In early 1992,
Shortly after the implosion of the USSR in December 1991, the
Ukrainian Government liberalized
most prices and erected a legal
framework for privatization, but
widespread resistance to reform
within the government and the
legislature soon stalled reform efforts
and led to some
backtracking. Output in 1992-96 fell precipitously to
less than half the 1991 level. Loose monetary policies pushed
inflation to
hyperinflationary levels in late 1993. Since his election
in July
1994, President KUCHMA has developed pushed a comprehensive economic reform
reform program, maintained financial discipline, and removed tried to remove
almost all
remaining controls over prices and foreign trade.
Implementation of KUCHMA's
economic agenda is encountering
considerable resistance from
parliament, entrenched bureaucrats, and
industrial interests.
However, should if KUCHMA succeed succeeds in implementing
aggressive market
reforms during 1996, 1997, the economy may stabilize and possibly achieve should reverse its
downward trend, with real growth in the range of 0.5%-1%. occurring by late 1997 and into 1998.

After Russia, the Ukrainian republic was far and
away the most important economic component of the former Soviet Union,
producing about four times the output of the next-ranking republic.
Its fertile black soil generated more than one-fourth of Soviet
agricultural output, and its farms provided substantial quantities of
meat, milk, grain, and vegetables to other republics. Likewise, its
diversified heavy industry supplied equipment and raw materials to
industrial and mining sites in other regions of the former USSR.
Ukraine depends on imports of energy, especially natural gas. Shortly
after the implosion of the USSR in December 1991, the
Ukrainian
Government liberalized most prices and erected a legal
framework for
privatization, but widespread resistance to reform
within the
government and the legislature soon stalled reform efforts
and led to
some backtracking. Output in 1992-96 1992-97 fell precipitously to
less than half the 1991
level. Loose monetary policies pushed
inflation to hyperinflationary
levels in late 1993. Since his election
in July 1994, President KUCHMA
has pushed a comprehensive economic
reform program, reforms, maintained financial discipline, and
tried to remove
almost all remaining controls over prices and foreign trade.
trade. Implementation of KUCHMA's economic agenda is encountering
considerable resistance from parliament, entrenched bureaucrats, and
industrial interests. However, if interests; and an environment of corruption continues to
discourage foreign investors. One signal achievement has been the
reduction of the inflation rate to 10% by yearend 1997. If KUCHMA
succeeds in implementing
aggressive market reforms during 1997, 1998, the
economy should reverse its
downward trend, with real growth occurring
by late 1997 1998 and into 1998. 1999.

After Russia, the Ukrainian republic was far and
and away the most important economic component of the former Soviet Union,
Union, producing about four times the output of the next-ranking republic.
republic. Its fertile black soil generated more than one-fourth of Soviet
Soviet agricultural output, and its farms provided substantial
quantities of
meat, milk, grain, and vegetables to other republics.
Likewise, its
diversified heavy industry supplied equipment and raw
materials to
industrial and mining sites in other regions of the
former USSR.
Ukraine depends on imports of energy, especially
natural gas. Shortly
after the implosion of the USSR in December
1991, the Ukrainian
Government liberalized most prices and erected a
legal framework for
privatization, but widespread resistance to
reform within the
government and the legislature soon stalled reform
efforts and led to
some backtracking. Output in 1992-97 1992-98 fell to less
than half the 1991
level. Loose monetary policies pushed inflation
to hyperinflationary
levels in late 1993. Since his election in July
1994, President KUCHMA
has pushed economic reforms, maintained
financial discipline, and
tried to remove almost all remaining
controls over prices and foreign
trade. Implementation The onset of KUCHMA's economic agenda is encountering the financial
considerable resistance from parliament, entrenched bureaucrats, and crisis in Russia dashed Ukraine's hopes for its first year of
industrial interests; economic growth in 1998 due to a sharp fall in export revenue and an environment of corruption continues
reduced domestic demand. Although administrative currency controls
will be lifted in early 1999, they are likely to be reimposed when
discourage foreign investors. One signal achievement has been the hryvnia next comes under pressure. The currency is only likely
reduction of the inflation rate to 10% by yearend 1997. If KUCHMA collapse further if Ukraine abandons tight monetary policies or
succeeds in implementing aggressive market reforms during 1998, threatens default. Despite increasing pressure from the IMF to
economy should reverse its downward trend, with real growth occurring accelerate reform, significant economic restructuring remains
by late 1998 and into unlikely in 1999.

After Russia, the Ukrainian republic was far
and away the most important economic component of the former Soviet
Union, producing about four times the output of the next-ranking
republic. Its fertile black soil generated more than one-fourth of
Soviet agricultural output, and its farms provided substantial
quantities of meat, milk, grain, and vegetables to other republics.
Likewise, its diversified heavy industry supplied equipment and raw
materials to industrial and mining sites in other regions of the
former USSR. Ukraine depends on imports of energy, especially
natural gas. Shortly after the implosion of the USSR in December
1991, the Ukrainian Government liberalized most prices and erected a
legal framework for privatization, but widespread resistance to
reform within the government and the legislature soon stalled reform
efforts and led to some backtracking. Output in 1992-98 1992-99 fell to less
than half 40% the 1991 level. Loose monetary policies pushed inflation
to hyperinflationary levels in late 1993. Since his election in July
1994, President KUCHMA has pushed economic reforms, maintained
financial discipline, and tried to remove almost all remaining
controls over prices and foreign trade. The onset of the financial
crisis in Russia dashed Ukraine's hopes for its first year of
economic growth in 1998 due to a sharp fall in export revenue and
reduced domestic demand. Although administrative currency controls
will be lifted in early 1999, they are likely Output continued to be reimposed when
the hryvnia next comes under pressure. drop, slightly, in 1999. The currency is only likely
government has also not been able to collapse further if Ukraine abandons tight monetary policies or
threatens default. significantly decrease its huge backlog of wage and pension arrears. Despite increasing pressure from the IMF to
accelerate reform, significant substantial economic restructuring remains
unlikely in 1999. 2000, largely because of resistance in the communist-dominated legislature to further privatization.

After Russia, the Ukrainian republic was far and away the most important economic component of the former Soviet Union, producing about four times the output of the next-ranking republic. Its fertile black soil generated more than one-fourth of Soviet agricultural output, and its farms provided substantial quantities of meat, milk, grain, and vegetables to other republics. Likewise, its diversified heavy industry supplied the unique equipment (for example, large diameter pipes) and raw materials to industrial and mining sites (vertical drilling apparatus) in other regions of the former USSR. Ukraine depends on imports of energy, especially natural gas. gas, to meet some 85% of its annual energy requirements. Shortly after the implosion of the USSR independence in December late 1991, the Ukrainian Government liberalized most prices and erected a legal framework for privatization, but widespread resistance to reform within the government and the legislature soon stalled reform efforts and led to some backtracking. Output in 1992-99 fell to less than 40% the 1991 level. Loose monetary policies pushed inflation to hyperinflationary levels in late 1993. Since his election Ukraine's dependence on Russia for energy supplies and the lack of significant structural reform have made the Ukrainian economy vulnerable to external shocks. Now in July 1994, his second term, President KUCHMA has pushed economic reforms, maintained financial discipline, and tried pledged to remove almost all remaining controls over prices and foreign trade. The onset of reduce the financial crisis in Russia dashed Ukraine's hopes for its first year number of economic growth in 1998 due to a sharp fall in export revenue government agencies and reduced domestic demand. Output continued streamline the regulation process, create a legal environment to drop, slightly, encourage entrepreneurs and protect ownership rights, and enact a comprehensive tax overhaul. Reforms in 1999. The government has also not been able to significantly decrease its huge backlog the more politically sensitive areas of wage structural reform and pension arrears. Despite increasing pressure from land privatization are still lagging. Outside institutions - particularly the IMF - have encouraged Ukraine to accelerate reform, substantial economic restructuring remains unlikely in 2000, largely because quicken the pace and scope of resistance reforms and have threatened to withdraw financial support. GDP in 2000 showed strong export-based growth of 6% - the communist-dominated legislature to first growth since independence - and industrial production grew 12.9%. As the capacity for further privatization. export-based economic expansion diminishes, GDP growth in 2001 is likely to decline to around 3%.

After Russia, the Ukrainian republic was far and away the most important economic component of the former Soviet Union, producing about four times the output of the next-ranking republic. Its fertile black soil generated more than one-fourth of Soviet agricultural output, and its farms provided substantial quantities of meat, milk, grain, and vegetables to other republics. Likewise, its diversified heavy industry supplied the unique equipment (for example, large diameter pipes) and raw materials to industrial and mining sites (vertical drilling apparatus) in other regions of the former USSR. Ukraine depends on imports of energy, especially natural gas, to meet some 85% of its annual energy requirements. Shortly after independence in late 1991, the Ukrainian Government liberalized most prices and erected a legal framework for privatization, but widespread resistance to reform within the government and the legislature soon stalled reform efforts and led to some backtracking. Output in 1992-99 fell by 1999 had fallen to less than 40% the 1991 level. Loose monetary policies pushed inflation to hyperinflationary levels in late 1993. Ukraine's dependence on Russia for energy supplies and the lack of significant structural reform have made the Ukrainian economy vulnerable to external shocks. Now in his second term, President KUCHMA has pledged to reduce the number of government agencies and agencies, streamline the regulation regulatory process, create a legal environment to encourage entrepreneurs and protect ownership rights, entrepreneurs, and enact a comprehensive tax overhaul. Reforms in the more politically sensitive areas of structural reform and land privatization are still lagging. Outside institutions - particularly the IMF - have encouraged Ukraine to quicken the pace and scope of reforms and have threatened to withdraw financial support. GDP in 2000 showed strong export-based growth of 6% - the first growth since independence - and industrial production grew 12.9%. As the capacity for further export-based economic expansion diminishes, GDP growth The economy continued to expand in 2001 is likely to decline to around 3%. as real GDP rose 9% and industrial output grew by over 14%. Growth was undergirded by strong domestic demand and growing consumer and investor confidence.

After Russia, the Ukrainian republic was far and away the most important economic component of the former Soviet Union, producing about four times the output of the next-ranking republic. Its fertile black soil generated more than one-fourth of Soviet agricultural output, and its farms provided substantial quantities of meat, milk, grain, and vegetables to other republics. Likewise, its diversified heavy industry supplied the unique equipment (for example, large diameter pipes) and raw materials to industrial and mining sites (vertical drilling apparatus) in other regions of the former USSR. Ukraine depends on imports of energy, especially natural gas, to meet some 85% of its annual energy requirements. Shortly after independence in late December 1991, the Ukrainian Government liberalized most prices and erected a legal framework for privatization, but widespread resistance to reform within the government and the legislature soon stalled reform efforts and led to some backtracking. Output by 1999 had fallen to less than 40% of the 1991 level. Loose monetary policies pushed inflation to hyperinflationary levels in late 1993. Ukraine's dependence on Russia for energy supplies and the lack of significant structural reform have made the Ukrainian economy vulnerable to external shocks. Now in his second term, President KUCHMA has pledged to reduce the number of government agencies, streamline the regulatory process, create a legal environment to encourage entrepreneurs, and enact a comprehensive tax overhaul. Reforms in the more politically sensitive areas of structural reform and land privatization are still lagging. Outside institutions - particularly the IMF - have encouraged Ukraine to quicken the pace and scope of reforms and have threatened to withdraw financial support. reforms. GDP in 2000 showed strong export-based growth of 6% - the first growth since independence - and industrial production grew 12.9%. The economy continued to expand in 2001 as real GDP rose 9% and industrial output grew by over 14%. Growth of 4.1% in 2002 was more moderate, in part a reflection of faltering growth in the developed world. In general, growth has been undergirded by strong domestic demand demand, low inflation, and growing solid consumer and investor confidence. Growth was a sturdy 6% in 2003 despite a loss of mementum in needed economic reforms.

After Russia, the Ukrainian republic was far and away the most important economic component of the former Soviet Union, producing about four times the output of the next-ranking republic. Its fertile black soil generated more than one-fourth of Soviet agricultural output, and its farms provided substantial quantities of meat, milk, grain, and vegetables to other republics. Likewise, its diversified heavy industry supplied the unique equipment (for example, large diameter pipes) and raw materials to industrial and mining sites (vertical drilling apparatus) in other regions of the former USSR. Ukraine depends on imports of energy, especially natural gas, to meet some 85% of its annual energy requirements. Shortly after independence in December 1991, the Ukrainian Government liberalized most prices and erected a legal framework for privatization, but widespread resistance to reform within the government and the legislature soon stalled reform efforts and led to some backtracking. Output by 1999 had fallen to less than 40% of the 1991 level. Loose monetary policies pushed inflation to hyperinflationary levels in late 1993. Ukraine's dependence on Russia for energy supplies and the lack of significant structural reform have made the Ukrainian economy vulnerable to external shocks. Now in his second term, President KUCHMA has had pledged to reduce the number of government agencies, streamline the regulatory process, create a legal environment to encourage entrepreneurs, and enact a comprehensive tax overhaul. Reforms in the more politically sensitive areas of structural reform and land privatization are still lagging. Outside institutions - particularly the IMF - have encouraged Ukraine to quicken the pace and scope of reforms. GDP in 2000 showed strong export-based growth of 6% - the first growth since independence - and industrial production grew 12.9%. The economy continued to expand in 2001 as real GDP rose 9% and industrial output grew by over 14%. Growth of 4.1% 4.6% in 2002 was more moderate, in part a reflection of faltering growth in the developed world. In general, growth has been undergirded by strong domestic demand, low inflation, and solid consumer and investor confidence. Growth was a sturdy 6% 9.3% in 2003 and a remarkable 12% in 2004, despite a loss of mementum momentum in needed economic reforms.

After Russia, the Ukrainian republic was far and away the most important economic component of the former Soviet Union, producing about four times the output of the next-ranking republic. Its fertile black soil generated more than one-fourth of Soviet agricultural output, and its farms provided substantial quantities of meat, milk, grain, and vegetables to other republics. Likewise, its diversified heavy industry supplied the unique equipment (for example, large diameter pipes) and raw materials to industrial and mining sites (vertical drilling apparatus) in other regions of the former USSR. Ukraine depends on imports of energy, especially natural gas, to meet some 85% of its annual energy requirements. Shortly after independence in December 1991, the Ukrainian Government liberalized most prices and erected a legal framework for privatization, but widespread resistance to reform within the government and the legislature soon stalled reform efforts and led to some backtracking. Output by 1999 had fallen to less than 40% of the 1991 level. Loose monetary policies pushed inflation to hyperinflationary levels in late 1993. Ukraine's dependence on Russia for energy supplies and the lack of significant structural reform have made the Ukrainian economy vulnerable to external shocks. President KUCHMA had pledged Ukrainian government officials have taken some steps to reduce reform the number of government agencies, streamline country's Byzantine tax code, such as the regulatory process, create a legal environment to encourage entrepreneurs, implementation of lower tax rates aimed at bringing more economic activity out of Ukraine's large shadow economy, but more improvements are needed, including closing tax loopholes and enact a comprehensive eliminating tax overhaul. privileges and exemptions. Reforms in the more politically sensitive areas of structural reform and land privatization are still lagging. Outside institutions - particularly the IMF - have encouraged Ukraine to quicken the pace and scope of reforms. GDP in 2000 showed strong export-based growth of 6% - the first growth since independence - and industrial production grew 12.9%. The economy continued to expand in 2001 as real GDP rose 9% and industrial output grew by over 14%. Growth of 4.6% in 2002 was more moderate, in part a reflection of faltering growth in the developed world. In general, growth has been undergirded by strong domestic demand, low inflation, and solid consumer and investor confidence. Growth was a sturdy 9.3% in 2003 and a remarkable 12% in 2004, despite a loss of momentum in needed economic reforms.

After Russia, the Ukrainian republic was far and away the most important economic component of the former Soviet Union, producing about four times the output of the next-ranking republic. Its fertile black soil generated more than one-fourth of Soviet agricultural output, and its farms provided substantial quantities of meat, milk, grain, and vegetables to other republics. Likewise, its diversified heavy industry supplied the unique equipment (for example, large diameter pipes) and raw materials to industrial and mining sites (vertical drilling apparatus) in other regions of the former USSR. Ukraine depends on imports of energy, especially natural gas, to meet some 85% of its annual energy requirements. Shortly after independence was ratified in December 1991, the Ukrainian Government liberalized most prices and erected a legal framework for privatization, but widespread resistance to reform within the government and the legislature soon stalled reform efforts and led to some backtracking. Output by 1999 had fallen to less than 40% of the 1991 level. Loose monetary policies pushed inflation to hyperinflationary levels in late 1993. Ukraine's dependence on Russia for energy supplies and the lack of significant structural reform have made the Ukrainian economy vulnerable to external shocks. Ukrainian government officials have taken some steps A dispute with Russia over pricing led to reform a temporary gas cut-off; Ukraine concluded a deal with Russia in January 2006, which almost doubled the country's Byzantine tax code, such as price Ukraine pays for Russian gas, and could cost the implementation of lower Ukrainian economy $1.4-2.2 billion and cause GDP growth to fall 3-4%. Ukrainian government officials eliminated most tax rates aimed at and customs privileges in a March 2005 budget law, bringing more economic activity out of Ukraine's large shadow economy, but more improvements are needed, including closing tax loopholes and eliminating tax privileges fighting corruption, developing capital markets, and exemptions. improving the legislative framework for businesses. Reforms in the more politically sensitive areas of structural reform and land privatization are still lagging. Outside institutions - particularly the IMF - have encouraged Ukraine to quicken the pace and scope of reforms. GDP in 2000 showed strong export-based growth of 6% - the first growth since independence - and industrial production grew 12.9%. The economy continued to expand was 2.4% in 2001 as real GDP rose 9% and industrial output grew by over 14%. Growth of 4.6% 2005, down from 12.4% in 2002 was more moderate, 2004. The current account surplus reached $2.2 billion in part a reflection 2005. The privatization of faltering growth in the developed world. In general, growth has been undergirded by strong domestic demand, low inflation, and solid consumer and investor confidence. Growth was a sturdy 9.3% Kryvoryzhstal steelworks in 2003 and a remarkable 12% late 2005 produced $4.8 billion in 2004, despite a loss windfall revenue for the government. Some of momentum in needed economic reforms. the proceeds were used to finance the budget deficit, some to recapitalize two state banks, some to retire public debt, and the rest may be used to finance future deficits.

After Russia, the Ukrainian republic was far and away the most important economic component of the former Soviet Union, producing about four times the output of the next-ranking republic. Its fertile black soil generated more than one-fourth of Soviet agricultural output, and its farms provided substantial quantities of meat, milk, grain, and vegetables to other republics. Likewise, its diversified heavy industry supplied the unique equipment (for example, large diameter pipes) and raw materials to industrial and mining sites (vertical drilling apparatus) in other regions of the former USSR. Ukraine depends on imports of energy, especially natural gas, to meet some 85% of its annual energy requirements. Shortly after independence was ratified in December 1991, the Ukrainian Government liberalized most prices and erected a legal framework for privatization, but widespread resistance to reform within the government and the legislature soon stalled reform efforts and led to some backtracking. Output by 1999 had fallen to less than 40% of the 1991 level. Loose monetary policies pushed inflation to hyperinflationary levels in late 1993. Ukraine's dependence on Russia for energy supplies and the lack of significant structural reform have made the Ukrainian economy vulnerable to external shocks. Ukraine depends on imports to meet about three-fourths of its annual oil and natural gas requirements. A dispute with Russia over pricing in late 2005 and early 2006 led to a temporary gas cut-off; Ukraine concluded a deal with Russia in January 2006, which 2006 that almost doubled the price Ukraine pays for Russian gas, and could cost the Ukrainian economy $1.4-2.2 billion and cause GDP growth to fall 3-4%. billion. Ukrainian government Government officials eliminated most tax and customs privileges in a March 2005 budget law, bringing more economic activity out of Ukraine's large shadow economy, but more improvements are needed, including fighting corruption, developing capital markets, and improving the legislative framework for businesses. Reforms in the more politically sensitive areas of structural reform and land privatization are still lagging. Outside institutions - particularly the IMF - have encouraged Ukraine to quicken the pace and scope of reforms. In its efforts to accede to the World Trade Organization (WTO), Ukraine passed more than 20 laws in 2006 to bring its trading regime into consistency with WTO standards. GDP growth was 2.4% 7% in 2005, down 2006, up from 12.4% in 2004. The current account surplus reached $2.2 billion in 2005. The privatization of the Kryvoryzhstal steelworks 2.4% in late 2005 produced $4.8 billion in windfall revenue for the government. Some of the proceeds were used thanks to finance rising steel prices worldwide and growing consumption domestically. Although the budget deficit, some economy is likely to recapitalize two state banks, some expand in 2007, long-term growth could be threatened by the government's plans to retire public debt, reinstate tax, trade, and the rest may be used customs privileges and to finance future deficits. maintain restrictive grain export quotas.

After Russia, the Ukrainian republic was far and away the most important economic component of the former Soviet Union, producing about four times the output of the next-ranking republic. Its fertile black soil generated more than one-fourth of Soviet agricultural output, and its farms provided substantial quantities of meat, milk, grain, and vegetables to other republics. Likewise, its diversified heavy industry supplied the unique equipment (for example, large diameter pipes) and raw materials to industrial and mining sites (vertical drilling apparatus) in other regions of the former USSR. Shortly after independence was ratified in December 1991, the Ukrainian Government liberalized most prices and erected a legal framework for privatization, but widespread resistance to reform within the government and the legislature soon stalled reform efforts and led to some backtracking. Output by 1999 had fallen to less than 40% of the 1991 level. Loose monetary policies pushed inflation to hyperinflationary levels in late 1993. Ukraine's dependence on Russia for energy supplies and the lack of significant structural reform have made the Ukrainian economy vulnerable to external shocks. Ukraine depends on imports to meet about three-fourths of its annual oil and natural gas requirements. A dispute with Russia over pricing in late 2005 and early 2006 led to a temporary gas cut-off; Ukraine concluded a deal with Russia in January 2006 that almost doubled the price Ukraine pays for Russian gas, and could cost gas. Outside institutions - particularly the Ukrainian economy $1.4-2.2 billion. IMF - have encouraged Ukraine to quicken the pace and scope of reforms. Ukrainian Government officials eliminated most tax and customs privileges in a March 2005 budget law, bringing more economic activity out of Ukraine's large shadow economy, but more improvements are needed, including fighting corruption, developing capital markets, and improving the legislative framework for businesses. Reforms in the more politically sensitive areas of structural reform and land privatization are still lagging. Outside institutions - particularly the IMF - have encouraged Ukraine to quicken framework. Ukraine's economy remains buoyant despite political turmoil between the pace Prime Minister and scope of reforms. In its efforts to accede to the World Trade Organization (WTO), Ukraine passed more than 20 laws in 2006 to bring its trading regime into consistency with WTO standards. President. Real GDP growth was reached about 7% in 2006, up from 2.4% in 2005 thanks to rising steel 2006-07, fueled by high global prices worldwide for steel - Ukraine's top export - and growing consumption domestically. by strong domestic consumption, spurred by rising pensions and wages. Although the economy is likely to expand in 2007, 2008, long-term growth could be threatened by the government's plans to reinstate tax, trade, and customs privileges and to maintain restrictive grain export quotas.

After Russia, the Ukrainian republic was far and away the most important economic component of the former Soviet Union, producing about four times the output of the next-ranking republic. Its fertile black soil generated more than one-fourth of Soviet agricultural output, and its farms provided substantial quantities of meat, milk, grain, and vegetables to other republics. Likewise, its diversified heavy industry supplied the unique equipment (for example, large diameter pipes) and raw materials to industrial and mining sites (vertical drilling apparatus) in other regions of the former USSR. Shortly after independence was ratified in December 1991, the Ukrainian Government liberalized most prices and erected a legal framework for privatization, but widespread resistance to reform within the government and the legislature soon stalled reform efforts and led to some backtracking. Output by 1999 had fallen to less than 40% of the 1991 level. Ukraine's dependence on Russia for energy supplies and the lack of significant structural reform have made the Ukrainian economy vulnerable to external shocks. Ukraine depends on imports to meet about three-fourths of its annual oil and natural gas requirements. A dispute with Russia over pricing in late 2005 and early 2006 led to a temporary gas cut-off; Ukraine concluded a deal with Russia in January 2006 that almost doubled the price Ukraine pays for Russian gas. Disputes with Russia over pricing have led to periodic gas cut-offs. Outside institutions - particularly the IMF - have encouraged Ukraine to quicken the pace and scope of reforms. Ukrainian Government officials eliminated most tax and customs privileges in a March 2005 budget law, bringing more economic activity out of Ukraine's large shadow economy, but more improvements are needed, including fighting corruption, developing capital markets, and improving the legislative framework. Ukraine's economy remains was buoyant despite political turmoil between the Prime Minister prime minister and President. president until mid-2008. Real GDP growth reached about exceeded 7% in 2006-07, fueled by high global prices for steel - Ukraine's top export - and by strong domestic consumption, spurred by rising pensions and wages. Although The drop in steel prices and Ukraine's exposure to the economy is likely global financial crisis due to expand in 2008, long-term aggressive foreign borrowing has lowered growth could be threatened by in 2008 and the government's plans economy probably will contract in 2009. Ukraine reached an agreement with the IMF for a $16.5 billion standby arrangement in November 2008 to reinstate tax, trade, and customs privileges and deal with the economic crisis. However, political turmoil in Ukraine as well as deteriorating external conditions are likely to maintain restrictive grain export quotas. hamper efforts for economic recovery.

After Russia, the Ukrainian republic was far and away the most important economic component of the former Soviet Union, producing about four times the output of the next-ranking republic. Its fertile black soil generated more than one-fourth of Soviet agricultural output, and its farms provided substantial quantities of meat, milk, grain, and vegetables to other republics. Likewise, its diversified heavy industry supplied the unique equipment (for example, large diameter pipes) and raw materials to industrial and mining sites (vertical drilling apparatus) in other regions of the former USSR. Shortly after independence was ratified in December August 1991, the Ukrainian Government liberalized most prices and erected a legal framework for privatization, but widespread resistance to reform within the government and the legislature soon stalled reform efforts and led to some backtracking. Output by 1999 had fallen to less than 40% of the 1991 level. Ukraine's dependence on Russia for energy supplies and the lack of significant structural reform have made the Ukrainian economy vulnerable to external shocks. Ukraine depends on imports to meet about three-fourths of its annual oil and natural gas requirements. Ukraine concluded requirements and 100% of its nuclear fuel needs. After a deal two-week dispute that saw gas supplies cutoff to Europe, Ukraine agreed to ten-year gas supply and transit contracts with Russia in January 2006 2009 that almost doubled brought gas prices to "world" levels. The strict terms of the price Ukraine pays for Russian gas. Disputes with Russia over pricing contracts have led to periodic further hobbled Ukraine's cash-strapped state gas cut-offs. company, Naftohaz. Outside institutions - particularly the IMF - have encouraged Ukraine to quicken the pace and scope of reforms. Ukrainian Government officials eliminated most tax and customs privileges in a March 2005 budget law, bringing more economic activity out of Ukraine's large shadow economy, but more improvements are needed, including fighting corruption, developing capital markets, and improving the legislative framework. Ukraine's economy was buoyant despite political turmoil between the prime minister and president until mid-2008. Real GDP growth exceeded 7% in 2006-07, fueled by high global prices for steel - Ukraine's top export - and by strong domestic consumption, spurred by rising pensions and wages. Ukraine reached an agreement with the IMF for a $16.4 billion Stand-By Arrangement in November 2008 to deal with the economic crisis, but the Ukrainian Government's lack of progress in implementing reforms has twice delayed the release of IMF assistance funds. The drop in steel prices and Ukraine's exposure to the global financial crisis due to aggressive foreign borrowing has lowered growth in 2008 and the economy probably will contract contracted more than 15% in 2009. Ukraine reached an agreement with 2009, among the IMF for a $16.5 billion standby arrangement worst economic performances in November 2008 to deal with the economic crisis. However, political turmoil world; growth resumed in Ukraine as well as deteriorating external 2010, buoyed by exports. External conditions are likely to hamper efforts for economic recovery. recovery in 2011.

After Russia, the Ukrainian republic was far and away the most important economic component of the former Soviet Union, producing about four times the output of the next-ranking republic. Its fertile black soil generated more than one-fourth of Soviet agricultural output, and its farms provided substantial quantities of meat, milk, grain, and vegetables to other republics. Likewise, its diversified heavy industry supplied the unique equipment (for example, large diameter pipes) and raw materials to industrial and mining sites (vertical drilling apparatus) in other regions of the former USSR. Shortly after independence in August 1991, the Ukrainian Government liberalized most prices and erected a legal framework for privatization, but widespread resistance to reform within the government and the legislature soon stalled reform efforts and led to some backtracking. Output by 1999 had fallen to less than 40% of the 1991 level. Ukraine's dependence on Russia for energy supplies and the lack of significant structural reform have made the Ukrainian economy vulnerable to external shocks. Ukraine depends on imports to meet about three-fourths of its annual oil and natural gas requirements and 100% of its nuclear fuel needs. After a two-week dispute that saw gas supplies cutoff to Europe, Ukraine agreed to ten-year 10-year gas supply and transit contracts with Russia in January 2009 that brought gas prices to "world" levels. The strict terms of the contracts have further hobbled Ukraine's cash-strapped state gas company, Naftohaz. Outside institutions - particularly the IMF - have encouraged Ukraine to quicken the pace and scope of reforms. Ukrainian Government officials eliminated most tax and customs privileges in a March 2005 budget law, bringing more economic activity out of Ukraine's large shadow economy, but more improvements are needed, including fighting corruption, developing capital markets, and improving the legislative framework. Ukraine's economy was buoyant despite political turmoil between the prime minister and president until mid-2008. Real GDP growth exceeded 7% in 2006-07, fueled by high global prices for steel - Ukraine's top export - and by strong domestic consumption, spurred by rising pensions and wages. Ukraine reached an agreement with the IMF for a $16.4 billion Stand-By Arrangement in November 2008 to deal with the economic crisis, but the Ukrainian Government's lack of progress in implementing reforms has twice delayed the release of IMF assistance funds. The drop in steel prices and Ukraine's exposure to the global financial crisis due to aggressive foreign borrowing lowered growth in 2008 and the economy contracted more than 15% in 2009, among the worst economic performances in the world; growth resumed in 2010, buoyed by exports. External conditions are likely to hamper efforts for economic recovery in 2011.

After Russia, the Ukrainian republic was far and away the most important economic component of the former Soviet Union, producing about four times the output of the next-ranking republic. Its fertile black soil generated more than one-fourth of Soviet agricultural output, and its farms provided substantial quantities of meat, milk, grain, and vegetables to other republics. Likewise, its diversified heavy industry supplied the unique equipment (for example, large diameter pipes) and raw materials to industrial and mining sites (vertical drilling apparatus) in other regions of the former USSR. Shortly after independence in August 1991, the Ukrainian Government liberalized most prices and erected a legal framework for privatization, but widespread resistance to reform within the government and the legislature soon stalled reform efforts and led to some backtracking. Output by 1999 had fallen to less than 40% of the 1991 level. Ukraine's dependence on Russia for energy supplies and the lack of significant structural reform have made the Ukrainian economy vulnerable to external shocks. Ukraine depends on imports to meet about three-fourths of its annual oil and natural gas requirements and 100% of its nuclear fuel needs. After a two-week dispute that saw gas supplies cutoff to Europe, Ukraine agreed to 10-year gas supply and transit contracts with Russia in January 2009 that brought gas prices to "world" levels. The strict terms of the contracts have further hobbled Ukraine's cash-strapped state gas company, Naftohaz. Outside institutions - particularly the IMF - have encouraged Ukraine to quicken the pace and scope of reforms. Ukrainian Government officials eliminated most tax and customs privileges in a March 2005 budget law, bringing more economic activity out of Ukraine's large shadow economy, but more improvements are needed, including fighting corruption, developing capital markets, and improving the legislative framework. Ukraine's economy was buoyant despite political turmoil between the prime minister and president until mid-2008. Real GDP growth exceeded 7% in 2006-07, fueled by high global prices for steel - Ukraine's top export - and by strong domestic consumption, spurred by rising pensions and wages. A drop in steel prices and Ukraine's exposure to the global financial crisis due to aggressive foreign borrowing lowered growth in 2008. Ukraine reached an agreement with the IMF for a $16.4 billion Stand-By Arrangement in November 2008 to deal with the economic crisis, but the program quickly stalled due to the Ukrainian Government's lack of progress in implementing reforms has twice delayed the release of IMF assistance funds. reforms. The drop in steel prices and Ukraine's exposure to the global financial crisis due to aggressive foreign borrowing lowered growth in 2008 and the economy contracted more than nearly 15% in 2009, among the worst economic performances in the world; world. In April 2010, Ukraine negotiated a price discount on Russian gas imports in exchange for extending Russia's lease on its naval base in Crimea. In August 2010, Ukraine, under the YANUKOVYCH Administration, reached a new agreement with the IMF for a $15.1 billion Stand-By Agreement. Economic growth resumed in 2010, 2010 and 2011, buoyed by exports. External conditions are likely exports, but slowed in 2012. After initial disbursements, the IMF program stalled in early 2011 due to hamper efforts for economic recovery the Ukrainian Government's lack of progress in 2011. implementing key gas sector reforms, namely gas tariff increases.

After Russia, the Ukrainian republic was the most important economic component of the former Soviet Union, producing about four times the output of the next-ranking republic. Its fertile black soil generated more than one-fourth of Soviet agricultural output, and its farms provided substantial quantities of meat, milk, grain, and vegetables to other republics. Likewise, its diversified heavy industry supplied the unique equipment (for example, large diameter pipes) and raw materials to industrial and mining sites (vertical drilling apparatus) in other regions of the former USSR. Shortly after independence in August 1991, the Ukrainian Government liberalized most prices and erected a legal framework for privatization, but widespread resistance to reform within the government and the legislature soon stalled reform efforts and led to some backtracking. Output by 1999 had fallen to less than 40% of the 1991 level. Ukraine's dependence on Russia for energy supplies and the lack of significant structural reform have made the Ukrainian economy vulnerable to external shocks. Ukraine depends on imports to meet about three-fourths of its annual oil and natural gas requirements and 100% of its nuclear fuel needs. After a two-week dispute that saw gas supplies cutoff to Europe, Ukraine agreed to 10-year gas supply and transit contracts with Russia in January 2009 that brought gas prices to "world" levels. The strict terms of the contracts have further hobbled Ukraine's cash-strapped state gas company, Naftohaz. Outside institutions - particularly the IMF - have encouraged Ukraine to quicken the pace and scope of reforms. reforms to foster economic growth. Ukrainian Government officials eliminated most tax and customs privileges in a March 2005 budget law, bringing more economic activity out of Ukraine's large shadow economy, but more improvements are needed, including fighting corruption, developing capital markets, and improving the legislative framework. Ukraine's economy was buoyant despite political turmoil between the prime minister and president until mid-2008. Real GDP growth exceeded 7% in 2006-07, fueled by high global prices for steel - Ukraine's top export - and by strong domestic consumption, spurred by rising pensions and wages. A drop in steel prices and Ukraine's exposure to the global financial crisis due to aggressive foreign borrowing lowered growth in 2008. Ukraine reached an agreement with the IMF for a $16.4 billion Stand-By Arrangement in November 2008 to deal with the economic crisis, but the program quickly stalled due to the Ukrainian Government's lack of progress in implementing reforms. The economy contracted nearly 15% in 2009, among the worst economic performances in the world. In April 2010, Ukraine negotiated a price discount on Russian gas imports in exchange for extending Russia's lease on its naval base in Crimea. In August 2010, Ukraine, under the YANUKOVYCH Administration, reached a new agreement with the IMF for a $15.1 billion Stand-By Agreement. Economic growth resumed in 2010 and 2011, buoyed by exports, but slowed in 2012. exports. After initial disbursements, the IMF program stalled in early 2011 due to the Ukrainian Government's lack of progress in implementing key gas sector reforms, namely gas tariff increases. Economic growth slowed in the second half of 2012 with Ukraine finishing the year in technical recession following two consecutive quarters of negative growth.

After Russia, the Ukrainian republic was the most important economic component of the former Soviet Union, producing about four times the output of the next-ranking republic. Its fertile black soil generated more than one-fourth of Soviet agricultural output, and its farms provided substantial quantities of meat, milk, grain, and vegetables to other republics. Likewise, its diversified heavy industry supplied the unique equipment (for example, large diameter pipes) and raw materials to industrial and mining sites (vertical drilling apparatus) in other regions of the former USSR. Shortly after independence in August 1991, the Ukrainian Government liberalized most prices and erected a legal framework for privatization, but widespread resistance to reform within the government and the legislature soon stalled reform efforts and led to some backtracking. Output by 1999 had fallen to less than 40% of the 1991 level. Ukraine's dependence on Russia for energy supplies and the lack of significant structural reform have made the Ukrainian economy vulnerable to external shocks. Ukraine depends on imports to meet about three-fourths of its annual oil and natural gas requirements and 100% of its nuclear fuel needs. After a two-week dispute that saw gas supplies cutoff to Europe, Ukraine agreed to 10-year gas supply and transit contracts with Russia in January 2009 that brought gas prices to "world" levels. The strict terms of the contracts have further hobbled Ukraine's cash-strapped state gas company, Naftohaz. Outside institutions - particularly the IMF - have encouraged Ukraine to quicken the pace and scope of reforms to foster economic growth. Ukrainian Government officials eliminated most tax and customs privileges in a March 2005 budget law, bringing more economic activity out of Ukraine's large shadow economy, but more improvements are needed, including fighting corruption, developing capital markets, and improving the legislative framework. Ukraine's economy was buoyant despite political turmoil between the prime minister and president until mid-2008. Real GDP growth exceeded 7% in 2006-07, fueled by high global prices for steel - Ukraine's top export - and by strong domestic consumption, spurred by rising pensions and wages. A drop in steel prices and Ukraine's exposure to the global financial crisis due to aggressive foreign borrowing lowered growth in 2008. Ukraine reached an agreement with the IMF for a $16.4 billion Stand-By Arrangement in November 2008 to deal with the economic crisis, but the program quickly stalled due to the Ukrainian Government's lack of progress in implementing reforms. The economy contracted nearly 15% in 2009, among the worst economic performances in the world. In April 2010, Ukraine negotiated a price discount on Russian gas imports in exchange for extending Russia's lease on its naval base in Crimea. In August 2010, Ukraine, under the YANUKOVYCH Administration, reached a new agreement Movement toward an Association Agreement with the IMF European Union, which would commit Ukraine to economic and financial reforms in exchange for preferential access to EU markets, was curtailed by the November 2013 decision of President YANUKOVYCH against signing this treaty. In response, on 17 December 2013 President YANUKOVYCH and President PUTIN concluded a $15.1 financial assistance package containing $15 billion Stand-By Agreement. Economic growth resumed in 2010 loans and 2011, buoyed by exports. After initial disbursements, lower gas prices. However, the IMF program stalled end of the YANUKOVYCH government in early 2011 due February 2014 caused Russia to halt further funding. With the Ukrainian Government's lack formation of progress in implementing key gas sector reforms, namely gas tariff increases. Economic growth slowed an interim government in late February 2014, the second half of 2012 with Ukraine finishing international community began efforts to stabilize the year in technical recession following two consecutive quarters Ukrainian economy, including a 27 March 2014 IMF assistance package of negative growth. $14-18 billion.

After Russia, the Ukrainian republic was the most important economic component of the former Soviet Union, producing about four times the output of the next-ranking republic. Its fertile black soil generated more than one-fourth of Soviet agricultural output, and its farms provided substantial quantities of meat, milk, grain, and vegetables to other republics. Likewise, its diversified heavy industry supplied the unique equipment (for example, large diameter pipes) and raw materials to industrial and mining sites (vertical drilling apparatus) in other regions of the former USSR.
Shortly after independence in August 1991, the Ukrainian Government liberalized most prices and erected a legal framework for privatization, but widespread resistance to reform within the government and the legislature soon stalled reform efforts and led to some backtracking. Output by 1999 had fallen to less than 40% of the 1991 level. Outside institutions - particularly the IMF –encouraged Ukraine to quicken the pace and scope of reforms to foster economic growth. Ukrainian Government officials eliminated most tax and customs privileges in a March 2005 budget law, bringing more economic activity out of Ukraine's large shadow economy, but more improvements are needed, including fighting corruption, developing capital markets, and improving the legislative framework. From 2000 until mid-2008, Ukraine's economy was buoyant despite political turmoil between the prime minister and president.
Ukraine's dependence on Russia for energy supplies and the lack of significant structural reform have made the Ukrainian economy vulnerable to external shocks. Ukraine depends on imports to meet about three-fourths of its annual oil and natural gas requirements and 100% of its nuclear fuel needs. After In January 2009, after a two-week dispute that saw gas supplies cutoff to Europe, Ukraine agreed to 10-year gas supply and transit contracts with Russia in January 2009 that brought gas prices to "world" levels. The strict terms of the contracts have further hobbled Ukraine's cash-strapped state gas company, Naftohaz. Outside institutions - particularly the IMF - have encouraged Ukraine to quicken the pace and scope of reforms to foster economic growth. Ukrainian Government officials eliminated most tax and customs privileges in a March 2005 budget law, bringing more economic activity out of Ukraine's large shadow economy, but more improvements are needed, including fighting corruption, developing capital markets, and improving the legislative framework. Ukraine's economy was buoyant despite political turmoil between the prime minister and president until mid-2008. The economy contracted nearly 15% in 2009, among the worst economic performances in the world. In April 2010, Ukraine negotiated a price discount on Russian gas imports in exchange for extending Russia's lease on its naval base in Crimea.
Movement toward an Association Agreement with the European Union, which would commit Ukraine to economic and financial reforms in exchange for preferential access to EU markets, was curtailed by the a November 2013 decision of President YANUKOVYCH against signing this treaty. YANUKOVYCH. In response, on 17 December 2013 then President YANUKOVYCH and President PUTIN concluded a financial assistance package containing $15 billion in loans and lower gas prices. However, the end of the YANUKOVYCH government in February 2014 caused Russia to halt further funding. With the formation of an interim government in late February 2014, the international community began efforts to stabilize the Ukrainian economy, including a 27 March 2014 IMF assistance package of $14-18 billion. Russia’s seizure of the Crimean Peninsula created uncertainty as to the annual rate of growth of the Ukrainian economy in 2014.

After Russia, the Ukrainian republic was the most important economic component of the former Soviet Union, producing about four times the output of the next-ranking republic. Its fertile black soil generated more than one-fourth of Soviet agricultural output, and its farms provided substantial quantities of meat, milk, grain, and vegetables to other republics. Likewise, its diversified heavy industry supplied the unique equipment (for example, equipment, such as, large diameter pipes) pipes and vertical drilling apparatus, and raw materials to industrial and mining sites (vertical drilling apparatus) in other regions of the former USSR.
Shortly after independence in August 1991, the Ukrainian Government liberalized most prices and erected a legal framework for privatization, but widespread resistance to reform within the government and the legislature soon stalled reform efforts and led to some backtracking. Output by 1999 had fallen to less than 40% of the 1991 level. Outside institutions - particularly the IMF –encouraged Ukraine to quicken the pace and scope of reforms to foster economic growth. Ukrainian Government officials eliminated most tax and customs privileges in a March 2005 budget law, bringing more economic activity out of Ukraine's large shadow economy, but economy. But more improvements are needed, including fighting corruption, developing capital markets, and improving the legislative framework. From 2000 until mid-2008, Ukraine's economy was buoyant despite political turmoil between the prime minister and president.
Ukraine's dependence on Russia for energy supplies and the lack of significant structural reform have made the Ukrainian economy vulnerable to external shocks. Ukraine depends on imports to meet about three-fourths of its annual oil and natural gas requirements and 100% of its nuclear fuel needs. In January 2009, after a two-week dispute that saw gas supplies cutoff cut off to Europe, Ukraine agreed to 10-year gas supply and transit contracts with Russia that brought gas prices to "world" levels. The strict terms of the contracts further hobbled Ukraine's cash-strapped state gas company, Naftohaz. The economy contracted nearly 15% in 2009, among the worst economic performances in the world. In April 2010, Ukraine negotiated a price discount on Russian gas imports in exchange for extending Russia's lease on its naval base in Crimea.
Movement toward an Association Agreement with the European Union, which would commit Ukraine to economic and financial reforms in exchange for preferential access Ukraine’s oligarch-dominated economy grew slowly from 2010 to EU markets, was curtailed by a November 2013 decision of President YANUKOVYCH. In response, on 17 December 2013 then 2014. After former President YANUKOVYCH and President PUTIN concluded a financial assistance package containing $15 billion in loans and lower gas prices. However, the end of fled the YANUKOVYCH government in February 2014 caused Russia to halt further funding. With country during the formation Revolution of an interim government in late February 2014, Dignity, the international community began efforts to stabilize the Ukrainian economy, including a 27 March 2014 IMF assistance package of $14-18 billion. Ukraine has made significant progress on reforms designed to make the country a prosperous, democratic, and transparent country.
Russia’s seizure occupation of the Crimean Peninsula created uncertainty as to Crimea in March 2014 and on-going aggression in eastern Ukraine have hurt economic growth. With the annual rate loss of growth a major portion of the Ukrainian Ukraine’s heavy industry in Donbas and ongoing violence, Ukraine’s economy contracted by 6.8% in 2014. 2014 and by an estimated 10.5% in 2015. Ukraine and Russia have engaged in a trade war with sharply reduced trade between the countries by the end of 2015. The EU-Ukraine Deep and Comprehensive Free Trade Area finally started up on 1 January 2016, and is expected to help Ukraine integrate its economy with Europe by opening up markets and harmonizing regulations.

After Russia, the Ukrainian republic Republic was the most important economic component of the former Soviet Union, producing about four times the output of the next-ranking republic. Its fertile black soil generated more than one-fourth of Soviet agricultural output, and its farms provided substantial quantities of meat, milk, grain, and vegetables to other republics. Likewise, its diversified heavy industry supplied unique equipment, such as, large diameter pipes and vertical drilling apparatus, and raw materials to industrial and mining sites in other regions of the former USSR.
Shortly after independence in August 1991, the Ukrainian Government liberalized most prices and erected a legal framework for privatization, but widespread resistance to reform within the government and the legislature soon stalled reform efforts and led to some backtracking. Output by 1999 had fallen to less than 40% of the 1991 level. Outside institutions - particularly the IMF –encouraged encouraged Ukraine to quicken the pace and scope of reforms to foster economic growth. Ukrainian Government officials eliminated most tax and customs privileges in a March 2005 budget law, bringing more economic activity out of Ukraine's large shadow economy. But more improvements are needed, including fighting corruption, developing capital markets, and improving the legislative framework. From 2000 until mid-2008, Ukraine's economy was buoyant despite political turmoil between the prime minister and president.
Ukraine's dependence on Russia for energy supplies and the lack of significant structural reform have made the Ukrainian economy vulnerable to external shocks. Ukraine depends on imports to meet about three-fourths of its annual oil and natural gas requirements and 100% of its nuclear fuel needs. In January 2009, after a two-week dispute that saw gas supplies cut off to Europe, Ukraine agreed to 10-year gas supply and transit contracts with Russia that brought gas prices to "world" levels. The strict terms of the contracts further hobbled Ukraine's cash-strapped state gas company, Naftohaz. The economy contracted nearly 15% in 2009, among the worst economic performances in the world. In April 2010, Ukraine negotiated a price discount on Russian gas imports in exchange for extending Russia's lease on its naval base in Crimea.
Ukraine’s oligarch-dominated economy grew slowly from 2010 to 2014. 2013. After former President YANUKOVYCH fled the country during the Revolution of Dignity, the international community began efforts to stabilize the Ukrainian economy, including a March 2014 IMF assistance package of $14-18 $17.5 billion, of which Ukraine has received four disbursements, most recently in April 2017, bringing the total disbursed as of that date to approximately $8.4 billion. Ukraine has made significant progress on reforms designed to make the country a prosperous, democratic, and transparent country. transparent. But more improvements are needed, including fighting corruption, developing capital markets, and improving the legislative framework.
Russia’s occupation of Crimea in March 2014 and on-going ongoing aggression in eastern Ukraine have hurt economic growth. With the loss of a major portion of Ukraine’s heavy industry in Donbas and ongoing violence, Ukraine’s economy contracted by 6.8% 6.6% in 2014 and by an estimated 10.5% 14.3% in 2015. Ukraine and Russia have engaged 2015, but grew by 2.3% in a trade war with sharply reduced trade between 2016 as key reforms took hold. After the countries by EU and Ukraine enacted the end of 2015. The EU-Ukraine Deep and Comprehensive Free Trade Area finally started up on 1 January 2016, and is expected to help Ukraine integrate its economy Russia imposed a series of trade restrictions, the EU replaced Russia as Ukraine’s largest trading partner. Analysts predict approximately 2% growth in 2017, but a new prohibition on commercial trade with Europe by opening up markets and harmonizing regulations. separatist-controlled territories will have an uncertain effect on Ukraine’s key industrial sectors.

After Russia, the Ukrainian Republic was the most important economic component of the former Soviet Union, producing about four times the output of the next-ranking republic. Its fertile black soil generated accounted for more than one-fourth of Soviet agricultural output, and its farms provided substantial quantities of meat, milk, grain, and vegetables to other republics. Likewise, its diversified heavy industry supplied unique equipment, equipment such as, as large diameter pipes and vertical drilling apparatus, and raw materials to industrial and mining sites in other regions of the former USSR.
Shortly after independence in August 1991, the Ukrainian Government liberalized most prices and erected a legal framework for privatization, but widespread resistance to reform within the government and the legislature soon stalled reform efforts and led to some backtracking. Output by 1999 had fallen to less than 40% of the 1991 level. Outside institutions - particularly the IMF encouraged Ukraine to quicken the pace and scope of reforms to foster economic growth. Ukrainian Government officials eliminated most tax and customs privileges in a March 2005 budget law, bringing more economic activity out of Ukraine's large shadow economy. From 2000 until mid-2008, Ukraine's economy was buoyant despite political turmoil between the prime minister and president. The economy contracted nearly 15% in 2009, among the worst economic performances in the world. In April 2010, Ukraine negotiated a price discount on Russian gas imports in exchange for extending Russia's lease on its naval base in Crimea.
Ukraine’s oligarch-dominated economy grew slowly from 2010 to 2013. 2013, but remained behind peers in the region and among Europe’s poorest. After former President YANUKOVYCH fled the country during the Revolution of Dignity, Ukraine’s economy fell into crisis because of Russia’s annexation of Crimea, military conflict in the eastern part of the country, and a trade war with Russia, resulting in a 17% decline in GDP, inflation at nearly 60%, and dwindling foreign currency reserves. The international community began efforts to stabilize the Ukrainian economy, including a March 2014 IMF assistance package of $17.5 billion, of which Ukraine has received four disbursements, most recently in April 2017, bringing the total disbursed as of that date to approximately $8.4 billion. Ukraine has made significant progress on reforms designed to make the country prosperous, democratic, and transparent. transparent, including creation of a national anti-corruption agency, overhaul of the banking sector, establishment of a transparent VAT refund system, and increased transparency in government procurement. But more improvements are needed, including fighting corruption, developing capital markets, and improving the legislative framework.
business environment to attract foreign investment, privatizing state-owned enterprises, and land reform. The fifth tranche of the IMF program, valued at $1.9 billion, was delayed in mid-2017 due to lack of progress on outstanding reforms, including adjustment of gas tariffs to import parity levels and adoption of legislation establishing an independent anti-corruption court. Russia’s occupation of Crimea in March 2014 and ongoing aggression in eastern Ukraine have hurt economic growth. With the loss of a major portion of Ukraine’s heavy industry in Donbas and ongoing violence, Ukraine’s the economy contracted by 6.6% in 2014 and by 14.3% 9.8% in 2015, but grew by 2.3% it returned to low growth in in 2016 and 2017, reaching 2.3% and 2.0%, respectively, as key reforms took hold. After Ukraine also redirected trade activity towards the EU and Ukraine enacted following the implementation of a bilateral Deep and Comprehensive Free Trade Area and Russia imposed a series of trade restrictions, the EU replaced Agreement, displacing Russia as Ukraine’s its largest trading partner. Analysts predict approximately 2% growth in 2017, but a new A prohibition on commercial trade with separatist-controlled territories will have an uncertain effect on in early 2017 has not impacted Ukraine’s key industrial sectors. sectors as much as expected, largely because of favorable external conditions. Ukraine returned to international debt markets in September 2017, issuing a $3 billion sovereign bond.

After Russia, the Ukrainian Republic was the most important economic component of the former Soviet Union, producing about four times the output of the next-ranking republic. Its fertile black soil accounted for more than one-fourth one fourth of Soviet agricultural output, and its farms provided substantial quantities of meat, milk, grain, and vegetables to other republics. Likewise, its diversified heavy industry supplied unique equipment such as large diameter pipes and vertical drilling apparatus, and raw materials to industrial and mining sites in other regions of the former USSR. Shortly after independence in August 1991, the Ukrainian Government liberalized most prices and erected a legal framework for privatization, but widespread resistance to reform within the government and the legislature soon stalled reform efforts and led to some backtracking. Output by 1999 had fallen to less than 40% of the 1991 level. Outside institutions - particularly the IMF encouraged Ukraine to quicken the pace and scope of reforms to foster economic growth. Ukrainian Government officials eliminated most tax and customs privileges in a March 2005 budget law, bringing more economic activity out of Ukraine's large shadow economy. From 2000 until mid-2008, Ukraine's economy was buoyant despite political turmoil between the prime minister and president. The economy contracted nearly 15% in 2009, among the worst economic performances in the world. In April 2010, Ukraine negotiated a price discount on Russian gas imports in exchange for extending Russia's lease on its naval base in Crimea. Ukraine’s oligarch-dominated economy grew slowly from 2010 to 2013, 2013 but remained behind peers in the region and among Europe’s poorest. After former President YANUKOVYCH fled the country during the Revolution of Dignity, Ukraine’s economy fell into crisis because of Russia’s annexation of Crimea, military conflict in the eastern part of the country, and a trade war with Russia, resulting in a 17% decline in GDP, inflation at nearly 60%, and dwindling foreign currency reserves. The international community began efforts to stabilize the Ukrainian economy, including a March 2014 IMF assistance package of $17.5 billion, of which Ukraine has received four disbursements, most recently in April 2017, bringing the total disbursed as of that date to approximately $8.4 billion. Ukraine has made significant progress on reforms designed to make the country prosperous, democratic, and transparent, including creation of a national anti-corruption agency, overhaul of the banking sector, establishment of a transparent VAT refund system, and increased transparency in government procurement. But more improvements are needed, including fighting corruption, developing capital markets, improving the business environment to attract foreign investment, privatizing state-owned enterprises, and land reform. The fifth tranche of the IMF program, valued at $1.9 billion, was delayed in mid-2017 due to lack of progress on outstanding reforms, including adjustment of gas tariffs to import parity levels and adoption of legislation establishing an independent anti-corruption court. Russia’s occupation of Crimea in March 2014 and ongoing Russian aggression in eastern Ukraine have hurt economic growth. With the loss of a major portion of Ukraine’s heavy industry in Donbas and ongoing violence, the economy contracted by 6.6% in 2014 and by 9.8% in 2015, but it returned to low growth in in 2016 and 2017, reaching 2.3% and 2.0%, respectively, as key reforms took hold. Ukraine also redirected trade activity towards the EU following the implementation of a bilateral Deep and Comprehensive Free Trade Agreement, displacing Russia as its largest trading partner. A prohibition on commercial trade with separatist-controlled territories in early 2017 has not impacted Ukraine’s key industrial sectors as much as expected, largely because of favorable external conditions. Ukraine returned to international debt markets in September 2017, issuing a $3 billion sovereign bond.

After Russia, the Ukrainian Republic was the most important economic component of the former Soviet Union, producing about four times the output of the next-ranking republic. Its fertile black soil accounted for more than one fourth of Soviet agricultural output, and its farms provided substantial quantities of meat, milk, grain, and vegetables to other republics. Likewise, its diversified heavy industry supplied unique equipment such as large diameter pipes and vertical drilling apparatus, and raw materials to industrial and mining sites in other regions of the former USSR.
Shortly after independence in August 1991, the Ukrainian Government liberalized most prices and erected a legal framework for privatization, but widespread resistance to reform within the government and the legislature soon stalled reform efforts and led to some backtracking. Output by 1999 had fallen to less than 40% of the 1991 level. Outside institutions - particularly the IMF encouraged Ukraine to quicken the pace and scope of reforms to foster economic growth. Ukrainian Government officials eliminated most tax and customs privileges in a March 2005 budget law, bringing more economic activity out of Ukraine's large shadow economy. From 2000 until mid-2008, Ukraine's economy was buoyant despite political turmoil between the prime minister and president. The economy contracted nearly 15% in 2009, among the worst economic performances in the world. In April 2010, Ukraine negotiated a price discount on Russian gas imports in exchange for extending Russia's lease on its naval base in Crimea.
Ukraine’s oligarch-dominated economy grew slowly from 2010 to 2013 but remained behind peers in the region and among Europe’s poorest. After former President YANUKOVYCH fled the country during the Revolution of Dignity, Ukraine’s economy fell into crisis because of Russia’s annexation of Crimea, military conflict in the eastern part of the country, and a trade war with Russia, resulting in a 17% decline in GDP, inflation at nearly 60%, and dwindling foreign currency reserves. The international community began efforts to stabilize the Ukrainian economy, including a March 2014 IMF assistance package of $17.5 billion, of which Ukraine has received four disbursements, most recently in April 2017, bringing the total disbursed as of that date to approximately $8.4 billion. Ukraine has made progress on reforms designed to make the country prosperous, democratic, and transparent, including creation of a national anti-corruption agency, overhaul of the banking sector, establishment of a transparent VAT refund system, and increased transparency in government procurement. But more improvements are needed, including fighting corruption, developing capital markets, improving the business environment to attract foreign investment, privatizing state-owned enterprises, and land reform. The fifth tranche of the IMF program, valued at $1.9 billion, was delayed in mid-2017 due to lack of progress on outstanding reforms, including adjustment of gas tariffs to import parity levels and adoption of legislation establishing an independent anti-corruption court.
Russia’s occupation of Crimea in March 2014 and ongoing Russian aggression in eastern Ukraine have hurt economic growth. With the loss of a major portion of Ukraine’s heavy industry in Donbas and ongoing violence, the economy contracted by 6.6% in 2014 and by 9.8% in 2015, but it returned to low growth in in 2016 and 2017, reaching 2.3% and 2.0%, respectively, as key reforms took hold. Ukraine also redirected trade activity towards the EU following the implementation of a bilateral Deep and Comprehensive Free Trade Agreement, displacing Russia as its largest trading partner. A prohibition on commercial trade with separatist-controlled territories in early 2017 has not impacted Ukraine’s key industrial sectors as much as expected, largely because of favorable external conditions. Ukraine returned to international debt markets in September 2017, issuing a $3 billion sovereign bond.

lower-middle-income, non-EU, Eastern European economy; key wheat and corn exporter; gradual recovery after 30% GDP contraction at start of war; damage to infrastructure and agriculture balanced by consumer and business resilience; resilience in western Ukraine; international aid has stabilized foreign exchange reserves, allowing managed currency float; continued progress on anti-corruption reforms