Ukraine’s economy teeters towards collapse – Mar. 4, 2015

Category: Ukraine

Ukraine's economy is collapsing.

Its central bank raised benchmark interest rates from 19.5% to 30% effective Wednesday. Ukraine's currency, the hryvnia, has lost nearly 70% of its value against the dollar in just a year. GDP shrank by 7% in 2014.

And while the war-torn country secured a $40 billion international bailout package in February, the chances of recovery any time soon are small.

Ukraine has been battling Russia-backed separatists in the eastern part of the country for the past year. The fighting has contributed to the ravaged state of the economy.

Here are some of the major economic obstacles:

1. Corruption

Corruption is draining Ukraine's economy -- or what's left of it. Ukraine ranks 142 of 175 on the Transparency International list of most corrupt countries.

Even the government admits the situation is bad. Ukrainian Prime Minister Arseniy Yatsenyuk said the government loses around $10 billion every year through graft.

Related: Ukraine recruits Internet army to fight Russian trolls

2. Political risk

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Ukraine's economy teeters towards collapse - Mar. 4, 2015

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