Russia's War Against Ukraine
OP-ED
Anders Aslund: Russia’s war on Ukraine’s economy
People queue to get free bread during a distribution outskirts of eastern Ukrainian city of Donetsk on July 7. Kyiv said Tuesday that Russia had cut off electricity to Ukraine's rebel-run regions in what appears to be another sign that Moscow is losing interest in plans to splinter its neighbour. AFP PHOTO/ ALEKSANDER GAYUK
WASHINGTON, DC – Ukraine’s economy may no longer be in free fall, but it remains in dire straits. The country’s GDP contracted by 6.8% last year, and is forecast to shrink by another 9% this year – a total loss of roughly 16% over two years. While things seem, to some extent, to be stabilizing – depreciation of the hryvnia has eliminated the country’s current-account deficit, and a massive fiscal adjustment brought Ukraine’s budget into cash balance in the second quarter of this year – the situation remains precarious.
