The Impact of the Political and Economic Situation in Ukraineon Economic Relations with Poland
Wydanie: Lublin 2016
The economic crisis and complicated political situation in Ukraine affected negatively the economic relations of that country with foreign states. The value of trade decreased and there has been a withdrawal of capital in the form of foreign direct investment. In this period similar changes have been observed also in Polish-Ukrainian economic relations. The aim of this study is to analyse the changes in the Polish-Ukrainian economic relations and identify main factors affecting these changes. It was an unfavourable economic situation in Ukraine that had the biggest influence on economic cooperation with foreign countries. A strong decline in GDP was observed in the years 2014-2015 and other economic indicators deteriorated. There was also a strong depreciation of the Ukrainian currency. Additionally, the unstable political situation in Ukraine had a negative impact on the economic situation and economic relations with foreign countries. In the period under scrutiny, there were also significant changes in the agreements governing the relations of Ukraine with foreign countries. Political and economic relations with Russia seriously deteriorated and it should be remembered that before 2014 Russia was the main trading partner of Ukraine. At the same time relations with the European Union improved after the signing of an association agreement. The worsening of the economic situation and the unstable political situation led to a significant drop in a Polish trade turnover with Ukraine. As a consequence, it has reduced the role of Ukraine as a trading partner of Poland. Despite the unfavourable trends in bilateral trade, Poland maintained its position among the main trade partners of Ukraine. The stabilization of political and economic situation and consistent reforms are necessary conditions for the development of Polish-Ukrainian economic cooperation. The full implementation of the association agreement of Ukraine with the European Union could be also a factor which would allow to assess positively the prospects for the development of the cooperation.