Ukraine's economy may no longer be in free fall, but it remains in dire straits. The country's GDP contracted by 6.8 percent last year, and is forecast to shrink by another 9 percent this year — a total loss of roughly 16 percent 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.
Ukraine's primary economic challenges are not homegrown; they are the result of Russian aggression. The country's belligerent eastern neighbor has annexed Crimea, sponsored rebels in eastern Ukraine, pursued a trade war, intermittently cut off its supply of natural gas, and is threatening financial attack. So far, Ukraine has miraculously managed to withstand these assaults with little international support — but it is in desperate need of assistance.
Russia's annexation of Crimea in March 2014 seized 4 percent of Ukraine's GDP. Since then, Russian-supported armed forces have occupied territories in eastern Ukraine that accounted for 10 percent of the country's GDP in 2013. With the Donbas region's production having plummeted by 70 percent in the months since, this has cost Ukraine some 7 percent of its 2013 GDP.