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Ever since Russian President Vladimir Putin decided to make Ukraine pay for having the temerity to oust a corrupt Moscow stooge from its presidency early last year, the country's economic outlook has veered between bleak and hopeless. Yet flashes of light have been breaking through the gloom, signalling that better times may lie ahead.

One of the bearers of (slightly) brighter news is Sir Suma Chakrabarti, president of the European Bank for Reconstruction and Development, the biggest outside investor in Ukraine.

The current government is making a serious effort to clean out rampant corruption, reform the economy and put the country on a sounder financial footing, Sir Suma said in an interview on Tuesday before addressing a meeting of the Ukrainian Canadian Congress in Toronto.

"I do think this is the best government we have seen in Ukraine since independence. In one respect, that's not a very high hurdle; they've been rubbish," he said. "But what is interesting is that you've now got people who have come in from the private sector with very strong reputations, in the finance and economy ministries in particular, but also infrastructure."

The EBRD is betting heavily on a positive outcome, investing a record €1.2-billion in 2014 in both public- and private-sector projects. That is more than double the amount of the previous year, when the development bank expressed its anger over widespread corruption.

"I would like us not to be the largest investor," Sir Suma said. "We are, partly because other people are shy at the moment about coming in. And that's understandable."

The development bank still warns of hard times ahead, forecasting that the economy will shrink by 7.5 per cent this year, worse than its previous forecast in January and the most dismal of the three dozen countries in which it conducts business. Resumed fighting in the eastern part of the country could make even that prediction optimistic, if it spreads unchecked.

"I wouldn't say it's a half-full glass, but at least the filling of the glass is in the right direction, compared with where we were two and a half, three years ago," Sir Suma said.

The Group of Seven countries warned Mr. Putin again this week that tougher sanctions will be applied if he does not uphold the ceasefire agreed to in the Minsk accord last September. The Russians deny any role in the resumed violence.

"At the moment, I don't see what the [Russian] plan is for Ukraine," Sir Suma said. "Is the plan the Minsk accord, which Mr. Putin has signed, after all? If that's the case, then we know what the plan is. Is it going to end up like … other frozen conflicts within the former Soviet Union? It's unclear. I'm at a loss to know what the Russian game plan is."

To turn its reform plans into reality, the government of President Petro Poroshenko has turned to a coterie of outside experts with no ties to vested Ukrainian interests standing in the way of sweeping change.

Among other high-level appointments, former Georgian health minister Aleksandre Kvitashvili now has the same job in Ukraine, where he will be responsible for reforming the corruption-plagued national system. A former Lithuanian finance minister and European commissioner, Algirdas Semeta, is taking on the new role of business ombudsman to deal with private-sector complaints, something the EBRD had lobbied hard for, as part of its anti-corruption proposals. A Lithuanian investment banker, Aivaras Abromavicius, is Minister of Economy and Trade.

This "clean hands" group has been put in key posts where there is serious cleaning up to do.

But what emerges from the fog of war in the east is still up in the air.

In the most positive scenario, "peace breaks out, some sort of accommodation deal is done and we can move forward to reconstruction of eastern Ukraine," Sir Suma said. "That's easier said than done."