Economic COLLAPSE in the UKRAINE-Coming to NORTH AMERICA

Economic meltdown prompts protest in Ukraine
By MARIA DANILOVA, Associated Press Writer – 2 hrs 13 mins ago

KIEV, Ukraine – The currency has lost half of its value, tens of thousands face layoffs, residents in the capital are bundling up in winter clothes as the heat sporadically goes out and Russia is threatening to cut off gas supplies.

It's going to be a tough winter in Ukraine.

"I could understand if this were a village, but for the capital of a European country not to have heating, water and gas — how can this be?" asked Tamara Osipova, one of about 1,000 angry protesters outside the Kiev mayor's office on Thursday.

This ex-Soviet republic has been one of hardest hit by the global financial crisis. Expert warn that the discontent visible Thursday could turn into mass opposition to a government paralyzed by political infighting.

"This is all going to boil over next year," political analyst Ivan Lozowy said. "Desperate people are capable of desperate actions."

After years of robust economic growth, Ukraine has sunk into a deep recession, pressured by a drastic fall in the exports of steel, the core of the economy. A lack of confidence in the banking system, coupled with constant political turmoil under President Viktor Yushchenko has spurred a sharp devaluation in the national currency.

The hryvna has lost a half its value since the global credit crunch hit in September, and closed at trading 9.8 to the dollar Thursday, down from 4.9 in September.

Valentyna Ivanova, a 68-year-old retired engineer, said she could not survive on 700 hryvna a month — half of which she will spend on utilities after fees were raised.


Yushchenko has forecast the economy will contract up to 10 percent by the first three months of 2009.

Many Ukrainians also borrowed dollars to buy apartments and cars. Yushchenko's economic adviser, Valentyn Zhukovsky, predicted that up to 60 percent of them may default. That will prompt some banks to confiscate property, while others may go bankrupt, experts say.
Valentyna Ivanova, a 68-year-old retired engineer, said she could not survive on 700 hryvna a month — half of which she will spend on utilities after fees were raised.

"When I come home I should eat something, shouldn't I? And how will I buy food?" she asked at the protest.

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