Decision time for Ukraine

By Kara Odum '15Economics Columnist

The past few months have been chaotic in Ukraine. From mass protests in the capital to allegations of torture, the country is expressing its great displeasure at President Viktor Yanukovich’s decision to back out of an EU trade pact. Ukraine is positioned in the center of two very large economic forces, with Russia on the east side and the European Union to the west. About half of the country is in support of each side. Ukraine officially became independent from the Soviet Union in 1990, which was followed by years of economic instability. It wasn’t until after the economy collapsed in 1998 that Ukraine finally met some economic prosperity in the early 2000’s. The economy in Ukraine has been suffering in the past few years due to a hard hit by the 2008 financial crisis, but Ukraine has natural resources and a highly educated workforce so they should be able to pull out of these economic hard times. Moving forward, the country finds itself at a crossroads. On one hand, Ukraine can choose to keep tight ties with Russia in exchange for subsidized commodities — especially cheaper gas — or, alternatively, they can try to integrate with the European Union, with the first step of passing a trade pact. It is widely believed that integration with the European Union would be beneficial, although any short-term gains are uncertain, while siding with Russia is seen as only benefitting the rich and powerful. Protestors and activists have been extremely active since November, when the President decided to not go through with the European Union trade pact. Since then the conflict has escalated, thanks in part to the government passing anti-protest laws that threaten ten years of imprisonment. Protestors have responded by taking over government buildings and building barricades in the capital city of Kiev. Recently, the president has tried to ease tensions by agreeing to appoint an opposition leader as the new prime minister and to repeal the anti-protest laws, but the protestors are not backing down. Vladimir Putin has indicated that Russia will continue to help the country and is not connected to a particular governmental regime. However, Russia has not restarted its financial aid to the nation and has unofficially renewed sanctions, so it will be interesting to see how Ukraine maneuvers its economic future between the European Union and Russia.