The European Bank for Reconstruction and Development (EBRD) has updated its forecast for the contraction of Ukraineʼs economy. Due to the war, the economy is predicted to fall by 30% in 2022, and growth is predicted to be only 8% in the following year. Before that, the EBRD predicted a 25% growth for 2023.
The forecast says that the fighting is only in the east and south, which together generated about 20% of GDP, but economic activity has declined even in those regions where it is calm. This is due to problems with logistics, lack of workers and financial difficulties.
In addition, many economic losses were caused by Russian shelling and the blockade of the Black Sea. The obstruction of the export of agricultural products and the destruction of metallurgical enterprises destroyed two of Ukraineʼs main export items.
The restoration of export of agricultural products and international financial support can have a positive effect on the economy of Ukraine during the last months of 2022, but the war can make its adjustments.
- In September, the State Statistics Service reported that the GDP of Ukraine fell by 37.2% in the second quarter of 2022. This is the second quarter in a row when the Ukrainian economy shows a decline.