THE Ukrainian economy would rather forget 2014. But 2015 may be little better: GDP is still shrinking. Gas payments, defence and support for the hryvnia, which lost half its value in 2014, have bled the government dry. Foreign-currency reserves fell by a quarter in December, leaving just $7.5 billion, equivalent to only five weeks’ worth of import cover. The central-bank head talks of a “full-blown financial crisis”. Some $11 billion of debt repayments loom in 2015. That includes a $3 billion Russian bond which falls due in December, but contains an early-repayment provision if Ukraine’s debt-to-GDP ratio exceeds 60%. Bond yields are soaring: Moody’s, a rating agency, calls the chances of a Ukrainian default “exceedingly high”. Official statistics should come out soon, but the 60% limit has almost certainly been breached. Russia says it can demand repayment, though it insists it does not want Ukraine to default. If Russia called the bond, other creditors could also demand immediate repayment. The threat is a useful negotiating tool for the Kremlin. In any case, Ukraine needs more help. The European Union is offering €1.8 billion ($2.1 billion); America is pledging $2 billion. Yet minimum estimates put Ukraine’s financing gap this year at $15 billion. The war in the east eats up $10m a day, according to Ukraine’s president, Petro Poroshenko. And far from abating, it is hotting up: rebel shelling of a bus near Donetsk this week killed 12 people.

The West’s reluctance to offer more money reflects mounting frustration over Ukraine’s haphazard reform efforts. After the election in October politicians took a month to form a coalition government, causing the IMF to put its programme on hold. Some progress has been made, including simplifying the tax code. But energy remains unreformed. The budget for 2015 was passed only at 4:30am on December 29th. The IMF is back in Kiev trying to revive its programme.

Default would sap domestic confidence in Ukraine’s leadership and roil the currency markets again. George Soros, a financier, is arguing for aid before reforms and promoting a $50 billion package. Such a sum has little chance of being found, but he raises a big question about Ukraine’s importance. A Ukrainian collapse would prove Mr Putin’s contention that Western promises mean little and that change in the post-Soviet world leads only to pain. The West may soon have to decide: what is Ukraine worth?