Incumbent Ukrainian President Petro Poroshenko checks his watch as he speaks to the media. David Ramos | Getty Images News | Getty Images

Ukraine is holding a presidential election on Sunday which is being closely watched by the West. CNBC has the lowdown on the vote and why it matters to Russia, Europe and the West in general.

What's going on?

The first round of a presidential election will be held on March 31, 2019. If no candidate gets an absolute majority, then a second vote (a run-off vote) will be held on April 21. Opinion polls show that political newcomer Volodymyr Zelensky, an actor who once played the president of Ukraine in a hit TV show, is leading the race and could usurp incumbent President Petro Poroshenko.

Why does it matter?

Ukraine is a country sandwiched between Russia and Europe and is often tugged both ways by its neighbors. While Ukraine's current government firmly sides with Europe and the West, Ukrainian politics and politicians can have deep ties to Russia, giving the vote a deeper geopolitical significance. The vote obviously has consequences for Ukraine's economy. Poroshenko came to power in 2014 following a pro-European popular uprising and he's overseen a reform program that was a condition of a $17.5 billion aid package the International Monetary Fund (IMF) gave the country in 2015, as well as a $3.9 billion credit line in December 2018. Yet reforms have stalled in recent months and recent row-backs on anti-corruption measures, a key condition of Western financial aid, has put Poroshenko's government on a collision course with its backers. Ukraine aspires to membership of organizations like NATO and the EU.

Who are the main contenders?

There are a record 39 candidates (there were 44) in Ukraine's presidential race but the main candidates are as follows: Petro Poroshenko: The current president and standing as an independent, there's no guarantee he'll win a second term in office. Poroshenko is pitching himself as the continuity candidate and one that's able to fulfil reforms, but critics say he has failed to tackle corruption. Poroshenko has also presided over the country during continued tension with its neighbor, Russia. Kiev's response to Moscow's aggression, such as Poroshenko's introduction of 30 days of martial law after Russia seized some Ukrainian ships, proved controversial. Yulia Tymoshenko: The leader of the "Fatherland" party. She's pro-Europe and is known for co-leading the "Orange Revolution" protests against corruption and electoral fraud in late 2004. The two-time prime minister has been the subject of various criminal investigations and was sentenced to seven years in prison in 2011. The charges and prison sentence were later ruled by Europe's human rights court to have been politically motivated. Volodymyr Zelensky: Politician, screenwriter and actor, Zelensky played the part of the Ukrainian president in a popular television show called "Servant of the People" in 2015. The production company that made the show created a political party of the same name in March 2018 and Zelensky was riding high in opinion polls before he even announced his candidacy on New Year's Eve. He is expected to get enough votes to pass through to the runoff vote.

Ukrainian entertainer and presidential candidate Volodymyr Zelensky holds a bunch of flowers after performing on stage in western Ukrainian city of Uzhhorod, on February 9, 2019. SERGIY GUDAK | AFP | Getty Images

Yuriy Boyko: Boyko is no stranger to politics having served as vice prime minister and former fuel and energy minister. He is an openly pro-Russian candidate. Boyko made the news in 2016 for punching a fellow member of parliament after he was accused of being a "Kremlin agent." Anatoliy Hrytsenko: The leader of the Civil Position party and a former defense minister. Oleh Lyashko: Former journalist Lyashko now leads the Radical Party. He went on hunger strike in support of Tymoshenko when she was imprisoned.

What do the polls say?

Experts say the election is a "three-horse race" between Poroshenko, Tymoshenko and Zelensky although the latter has been leading opinion polls in recent weeks. "Actor Volodymyr Zelensky has shot up in the polls ahead of the presidential election, while the campaign of the populist opposition leader Yulia Tymoshenko has begun to fade, impacting the probabilities of election scenarios. Zelensky is now the favorite to win the first round on 31 March, but a runoff on 21 April appears inevitable," Otilia Dhand, senior vice president at Teneo Intelligence, said in a note last Monday. "He would likely win against Tymoshenko, but the odds for a potential runoff between Zelensky and incumbent President Petro Poroshenko appear level." She put a 60 percent probability on Poroshenko and Zelensky facing each other in a second round of voting in April.

A supporter of former Ukrainian Prime Minister Yulia Tymoshenko holds a poster of her in front of a state-run hospital in Kharkiv, Ukraine, Wednesday May 9, 2012. Tymoshenko, Ukraine's imprisoned former prime minister, was moved Wednesday from jail to this hospital for treatment of a severe back condition under the supervision of a German doctor. The move was likely to allay at least some Western concerns over Tymoshenko's health and handling in prison. Top EU officials and some EU governme Alexey Furman