Russian President Vladimir Putin got a lot wrong with Ukraine, but he did get one thing right: The nation is increasingly moving away from Russia and toward the West, not only politically but also economically.
The current Russian war effort is focused on eastern Ukraine, bringing a high toll in human suffering and artillery-powered destruction to an area that long had close economic ties with Russia.
Today, however, Ukraine sells more to Europe. Since 2005, in the aftermath of the Orange Revolution protests that annulled the election of the Moscow-backed presidential candidate, the economy’s center of gravity has been moving westward. (See chart 1, below.)
WHY WE WROTE THIS
The backdrop for Vladimir Putin’s invasion of Ukraine is partly economic: A people long tethered to Russia have been increasingly looking toward the European Union for business and trade opportunities.
With that switch has come a change in the makeup of Ukraine’s exports, points out a recent report by the Harvard Growth Lab and the Complexity Science Hub Vienna. It used to sell some of its most complex manufactured goods to Russia: cars, aircraft, and so on. Now, it’s increasingly selling agricultural goods and electronics to Germany and other European nations. (See chart 2.)