Ukraine’s real gross domestic product (GDP) grew by 1.8% in 2025, which is lower than the previous estimate of 2% by the Institute for Economic Research and Policy Consulting (IER) and the Ministry of Economy’s forecast of 2.2%.
According to the institute’s Monthly Economic Monitoring of Ukraine (MEMU), economic growth was 5.2% in November, but slowed to 3.4% in December amid ongoing Russian attacks on energy and railway infrastructure. Positive dynamics at the end of the year were supported by the contribution of agriculture, where gross value added (GVA) growth was 54% in November and 35% in December, as well as the trade sector (GVA growth was 5.9%), business services, and public services.
“This growth was partly supported by the population’s continued efforts to adapt to regular planned and emergency power cuts,” the IER explains.
At the same time, December saw a significant drop in GVA in the extractive industry — by about 19% (compared to December 2024) due to the negative impact of Russian attacks on gas, ore, and coal production. Electricity and gas production and distribution fell by 18% (compared to December 2024) due to large-scale damage to generation facilities, which led to power outages in the Odesa, Kyiv, Zaporizhzhia, and Dnipropetrovsk regions, and the Zaporizhzhia Nuclear Power Plant lost its external power supply again on January 2.
Real GDP in the manufacturing industry fell by 1.9% in December (compared to December 2024) due to problems with access to electricity, but the decline was mitigated by businesses adapting through the use of generators, cogeneration plants, and solar panels, as well as by defense purchases. In the transport sector, the decline in GDP accelerated to 10% due to massive shelling of ports and railway infrastructure.
In December, the energy sector showed a 53% increase in electricity imports compared to November, to 640,000 MWh, while there were no exports. In total, 762 MW of new gas generation was commissioned in Ukraine in 2025, and the capacity of qualified cogeneration plants exempt from excise tax reached 3.1 GW.
Consumer inflation in December fell to 8% compared to 2024, while compared to November 2025, the consumer price index rose by only 0.2%, which was one of the lowest figures for December since the country’s independence. According to the IER, the slowdown in inflation was facilitated by a good harvest, stable world food and oil prices, as well as moderate consumer demand and high competition among non-food products.
As reported, the Ministry of Economy, Environment, and Agriculture of Ukraine estimates Ukraine’s real GDP growth for 2025 at 2.2%. According to its information, the economy is growing thanks to domestic trade, construction, thanks to reconstruction projects, as well as the processing industry, in particular, the production of defense products and metallurgy. On the other hand, economic growth was hampered by massive Russian missile attacks on power generation facilities and, for the first time in years of full-scale war, on gas production infrastructure; lower yields of certain crops due to unfavorable weather conditions – a 26.9% decrease in soybean yields, a 15.8% decrease in sunflower yields, a 7.6% decrease in rapeseed yields, and a nearly 14% decrease in sugar beet yields; however, grain yields increased by more than 3%.
The ICU investment group also lowered its forecast for Ukraine’s economic growth in 2026 to 1.2% from 2.1% in 2025, while in July 2025, the company predicted a 2.5% increase in GDP in 2025, and 2.8% in 2026 due to damage to energy and transport infrastructure, electricity shortages and complications with maritime exports, a gradual reduction in the state budget deficit and fiscal stimulus, as well as businesses delaying investments due to high security risks.
