The Crisis Of The Soviet Union

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This paper is attempting to look at the deeper financial and policy issues in which the country Ukraine faced during their financial crisis in 2008-09. The Ukraine faced a lot of economical and political challenges in recent years, in which their economy has plummeted drastically. Economic measurements such as GDP, unemployment, and average household incomes all were impacted in a negative way. Other factors, such as the Russian gas line, forced Ukrainian businesses to cut back on costs, further hindering their overall economy. Doing research, we have strong findings that prove how much the economy has fallen compared to earlier years. 1. Introduction After collapse of the Soviet Union, Ukraine was one of the left over countries that…show more content…
2. Russian Gas Line The reason why the crisis started, however, was how the Ukraine economy was set up in the first place. Their economy was heavily tied with their politics. Focusing on more so what happened in the country rather than why it happened leads us to see that Russia recently cut off the gas line between the two countries. (BBC, 2014) This was an important resource, not only for the Ukrainian people, but also for many Ukrainian businesses. Ukraine’s economy relies heavily on “Shipbuilding, steel and arms. However, because many industries are so energy-inefficient, they are highly dependent on imports of Russian gas, which have been heavily subsidized.” (BBC, 2014) When Russia cut off the gas line, Ukrainian businesses were hurt and forced to cut costs in order to make a profit. Many of their businesses ended up firing workers so their businesses were able move back to their individual equilibrium. Because this happened, Ukraine’s unemployment rate increased dramatically along with a decrease in real wages for employees. (BBC, 2014) “Traditionally, Ukraine has had a close economic relationship with Russia, with the two former Soviet republics having a
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