In the midst of conflict and tepid world growth, economies everywhere continue to struggle – some more than others.
Below are the countries on the verge of economic collapse, the problems they face, and just how they got to such dire economic straits.
Most concerning stats: Ukraine’s currency the hryvnia has lost 1/5th of its value
How it got so bad: Corruption, fiscal irresponsibility, and conflict
Ukraine’s economic problems have been around since their detachment from the former Soviet Union.
In the early 90s, due to lack of access to financial markets and government overspending, hyperinflation decimated Ukraine’s currency, which continued to flounder over the next decade.
Now, a violent insurgency which has mired Ukrainian cities like Luhansk and Donetsk, former economic hubs which account for 16 percent of Ukraine’s GDP, has made matters worse.
Most concerning stats: Greek unemployment is at 25 percent, and the economy has shrunk by a quarter in five years.
How it got so bad: Fiscal irresponsibility, corruption, and the European debt crisis
Though Greece’s economy received its greatest amount of attention following the 2008 financial crisis when Europe descended into its ongoing debt crisis, like Ukraine, the economy in Greece was troubled well before 2008.
Shortly after 2008, Greece, in 2009, admitted to understating its debt problem for years, and was soon shut out from bond markets in Europe – a decision which sent the Greek economy plummeting towards economic collapse.
Now, despite Greece receiving about $264 billion in bailout funds from the Troika (IMF, European Commission, and European Central Bank) their economy continues to flounder, and the country is once again in danger of defaulting on its debt.
The reason underlying Greece’s unsuccessful bailout has become a divisive topic in Europe, with EU countries like Germany citing Greece’s corruption and financial ineptitude as the cause, and Greek politicians blaming the bailout provisions’ strickening austerity programs.
Most concerning stats: In 2014, Venezuelan inflation hit 64 percent, while the economy shrunk by nearly 3 percent.
How it got so bad: plummeting oil prices and political instability
Today, the Venezuelan economy is regarded as the world’s worst. Mostly, Venezuela’s problems have to do with plummeting oil prices.
Because a barrel of crude oil now only costs below $50 – down over 50 percent from a year ago – Venezuela has lost much of its economic livelihood.
According to Investopedia, in 2013, oil sales accounted for 45 percent of Venezuela’s budgeted revenues and 96 percent of its export earnings.
This fact, coupled with crippling economic instability resulting from vast food shortages and increasingly authoritarian rule by President Nicolas Maduro, have created an adverse economic climate in Venezuela, who is expected to default on its $11 billion debt in October.