Macroeconomics of Ukraine

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Macroeconomics of Ukraine
Background
Ukraine is situated in Eastern Europe, bordering Russia to the east, Belarus to the north, Poland, Slovakia, Hungary to the west, and Moldova and Romania to the southwest. With a coastline along the Black Sea in the south, Ukraine's strategic geographic position has made it a focal point of regional conflicts. The country is usually divided into four; the north, south, middle, and mountainous regions. Much of the country is flat, typically characterized by the temperate grasslands called the steppes. Only towards the Crimean peninsula and the west of the country are there mountainous landscapes. The steppes are usually very fertile and provide ideal land for farming crops such as wheat. Ukraine is one of the world’s largest producers of wheat as a result.
Ukraine has a population of around 36 million, making it the 8th largest country in Europe. Average life expectancy is relatively low compared to Western Europe, at 73 years overall – 67 years for men and 78 years for women (“Ukraine Demographics 2020 (Population, Age, Sex, Trends) - Worldometer”). Much of the Ukrainian population lives in urban centers, the southeastern part of the country is the most densely populated portion due to the fact that this is also the portion that is most industrialized in the country. The country’s capital city is called Kyiv, but there are other major cities too, such as Kharkiv and Donetsk.
During the Soviet era, Ukraine had a very high population of around 50 million people, the number has however been steadily on the decline due to a number of reasons. Some of these reasons include a generally low birth rate in the country, migration of citizens to other countries in search of better opportunities, and an aging population (Kulu et.al.). The main challenge of a shrinking population is that there is a huge aging population depending on the younger population, meaning additional demands on the government due to social security needs for this aging population, and a huge burden for the working population. Additionally, a shrinking population means an insufficient workforce to work in the