Ukraine Faces Economic Ruin as Gas Dispute Remains Unresolved

Currency Plummets Again on Brief Ban on Foreign Exchange

The Minsk ceasefire is holding up remarkably well, and no one was killed in the Ukraine Civil War today. That should be great news for the Poroshenko government, but is likely overshadowed by their worsening economic state.

The state-run natural gas monopoly Naftogaz is struggling mightily with keeping gas imports flowing, and is once again facing a cut-off this week as they’ve failed once again to pre-pay for their shipments.

Meanwhile, the hryvnia, the Ukrainian currency, is in a state of free-fall, having lost about half of its value with respect to the US dollar so far in February. Today saw another plummet, when their central bank announced a surprise ban on currency trading.

The ban was supposed to be through the end of the week, and sent investors scrambling. The central bank, bizarrely, reversed the ban just hours later, leading to a bit of a rebound.

The damage may be done, however, with the threat of being hung with increasingly worthless hryvnias from an increasingly insolvent Ukrainian government underscored by that brief ban. While the IMF is promising to do something to save the currency, the number of bailouts Ukraine’s new government has already burned through doesn’t leave much hope that the nation, even if it can reform its way out of civil war, can readily fix its economy.

Author: Jason Ditz

Jason Ditz is news editor of