A decline in real gross domestic product (GDP) of Ukraine amounted to approximately 35% in August 2022 compared to August 2021, this estimate was given by the Ministry of Economy on Thursday.
“As you can see, the GDP decline rate is slowing down. This is confirmed by the trends that were observed in the second quarter and August of this year,” the ministry points out, commenting on the data released by the State Statistics Service on a GDP decline in the second quarter of 2022 by 37.2% compared to the second quarter of 2021, which is less than the previous estimates of the Ministry of Economy (40.6%).
“Over 2022, we expect a slowdown in a GDP fall to 33.2%. When forming the state budget for 2023, we will proceed from a conservative scenario for the development of events, which will allow the state to reduce budget risks and fully fulfill all its obligations to citizens,” the message quotes Deputy Prime Minister and Minister of Economy Yulia Svyrydenko.
The ministry indicates that August macro indicators were positively influenced by the partial unblocking of grain exports from the ports of Great Odesa to the EU countries, as well as the acceleration of a pace and volume of grain harvesting in the territory controlled by Ukraine. As of the end of August, 25.3 million tonnes had been harvested.
“In the future, a pace of recovery will depend on a situation at the front, a scale and speed of obtaining donor assistance, an availability of ports for export, a return of Ukrainians from abroad and a growth of labor productivity. Today there are grounds for restrained optimism,” Svyrydenko said.
The Ministry of Economy pointed to an observed improvement in business expectations about the prospects for their economic activity: the business activity expectations index in August amounted to 44.1 versus 43.6 in July.
Establishing import logistics chains and diversifying suppliers stabilized fuel prices, which reduced inflationary pressure on the economy amid falling external prices, especially for energy and food, the release notes.
In addition, in August Ukraine received a significant amount of international assistance – $4.6 billion, including $3 billion in grant funds from the United States through the World Bank. “In the foreseeable future, this makes it possible to ensure macroeconomic stability, cover military spending and reduce the budget deficit,” the Ministry of Economy believes.
