Hyperinflation and unemployment have made Ukrainians restless
The article originally appeared at German Economic News. Translated for RI by Anita Zalaldinova.
As a consequence of the falling hryvnia and rapidly rising inflation in Ukraine citizens now buy food in bulk. Moreover, Ukrainians will have to pay more for electricity starting in March. Public discontent is growing.
People in Ukraine fear that a similar economic failure as that after the collapse of the Soviet Union in 1991 could be repeated. Especially outside Kiev there are food shortages, hyperinflation and mass unemployment.
‘My business is on the edge of collapse and there are many other examples (…) Salaries are not being raised, inflation is growing and hryvnia is in free fall. I’m frightened about the future’, Bloomberg quoted the 65-year-old accountant in Kiev Valentina Lozova.
The economy is expected to shrink by 12 percent and in January inflation rose to 28.5 percent. Last year hryvnia lost 62 percent of its value.
‘Every day I can see people in supermarkets who buy sacks of flour and grain s a reserve because of the inflation’, says the 31-year-old Irina Lebiga who is looking for a buyer for her unprofitable sheep farm in Poltava.
Taxi driver Andriy Zaljeski reported that parking lots of hypermarkets are consistently full.
‘People buy things like canned goods, flour, sugar, buckwheat noodles and toilet paper’, said Zaljeski.
Citigroup economist Ivan Chakarov says that there is a growing discontent among the population. Economic life will become even harder and the promises of ‘Street Revolution’ remain largely unfulfilled.
Civilian population of Ukraine, pinched by poverty in many parts of the country, pays 40 percent more for their electricity bills since March. By this route Kiev government fulfils the requirements of the IMF.