From crisis into crisis – the previous decade of Ukraine’s economy

Abstract

The Ukrainian economy has been highly cyclical over the past 15 years. Regardless of whether we consider a series of domestic/foreign political events (2013-2015), an external financial/economic shock (2008-2009), or a shock caused by a pandemic (2020-2021) as the trigger, the Ukrainian economy has been hit by a severe economic crisis every five years or so since 2008, which has impeded its from catching-up at the regional level. From Ukraine's perspective, the period that started with the global financial and economic crisis was marked not only by global recessions (2008-2009 and 2020-2021), affecting both the neighboring countries and the world economy as a whole, but also by a crisis of local origin (2014-2015) – involving an annexation/occupation of territory which is not recognized by international law and an armed conflict – which, by its very nature, exacerbated the country's devergence from international norms. Consequently, Ukraine – compared to neighboring countries – was in a completely different situation when the pandemic arrived, since its economy was characterized by a slow but stable growth and recovery phase which had followed a severe recession marked by armed struggles, rising Russian-Ukrainian tensions, internal political skirmishes, reform initiatives, Western integration efforts, lending and aid programs, and by laws restricting the rights of national minorities and all the diplomatic conflicts that went along with them. Against this background, an assessment of the success of the pandemic response cannot be complete without an analysis of the main economic indicators for the preceding period 2013-2019. Thus, this study examines the economic tendencies of the given period, while the regional comparison of the state of the Ukrainian economy will provide us important information about the effectiveness of recovery from the recession caused by the Eastern Ukrainian conlict, namely: the measure of catching-up or lagging behind compared to the neighboring countries.