The Ukrainian economy is set to contract 12 percent this year, while inflation is forecast to reach 50.8 percent, according to the World Bank.

The main reasons for the slowing economy and rising inflation are the military conflict in Eastern Ukraine and a fall in trade with Russia.

According to Kiev’s statistical data, exports of Ukrainian goods to Russia fell by 55.6 percent in the first nine months of 2015.

Exports to Russia now stand at $3.6 billion, compared to $8.1 billion in the same period last year. The import of goods from Russia fell by 47.9 percent to $5.5 billion.

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Even so Russia remains Ukraine's largest trading partner, accounting for 12.8 percent of its exports and 20 percent of imports. Ukraine's second biggest export market is Turkey at 7.3 percent.

Ukraine has not been able to use preferential treatment from the EU under the Association Agreement that was supposed to cancel duty on Ukrainian products.

"To deliver goods to the EU Ukrainian businesses must obtain the appropriate certificates and it is a complicated procedure," said Kiev-based economist Aleksandr Okhrimenko.

With more than 50 percent inflation banks have practically stopped bankrolling the economy. The lending rate is about 30 percent per year in Ukrainian hryvnia. The national currency has lost 50 percent of its value in 2015, boosting inflation.

The World Bank estimates the Ukrainian economy will grow one percent in 2016, and inflation is projected to hit 23.4 percent next year.