The article presents key macroeconomic indicators of Ukraine and the global economy for January-July 2024. The analysis is based on official data from the State Statistics Service of Ukraine, the National Bank of Ukraine, the IMF, the World Bank, and the UN, on the basis of which Maksym Urakin, PhD in Economics, founder of the Experts Club Information and Analytical Center and Director of Business Development and Marketing, presented an analysis of macroeconomic trends in Ukraine and the world. Key aspects such as the dynamics of gross domestic product (GDP), inflation, unemployment, foreign trade and public debt of Ukraine, as well as global macroeconomic trends are considered.
Macroeconomic indicators of Ukraine
In the first eight months of 2024, Ukraine’s economy demonstrated steady positive dynamics amid recovery from the crisis. The National Bank of Ukraine estimated real GDP growth in the second quarter at 3.7% compared to the same period last year, which is in line with the April forecast. In July, this figure accelerated to 4.4% (compared to 3.1% in June and 3.5% in May), which was the result of an earlier and faster harvest.
“Ukraine’s economic successes in 2024 show that the country is beginning to overcome the consequences of the crisis. However, against the background of these indicators, it is important to take into account the growth of the negative foreign trade balance. This is a signal of the need to strengthen domestic production and increase export potential to avoid imbalances in the future,” said Maksym Urakin, founder of the Experts Club information and analytical center.
According to the State Statistics Service, the negative balance of Ukraine’s foreign trade in goods in January-August 2024 increased by 6.5% compared to the same period last year and amounted to $17.613 billion. The main reason for the increase was a slowdown in export growth amid accelerated imports. At the same time, Ukraine’s international reserves grew by 13.7%, reaching $42.33 billion, thanks to the attraction of long-term concessional financing from international partners.
“The growth of reserves to record levels is an important signal of confidence from international partners. However, it is important to realize that inflation remains a challenge. In August, inflation was 7.5% year-on-year after 5.4% in July and 4.8% in June. High inflation can significantly reduce the purchasing power of the population,” Urakin emphasized.
Inflation in August was 0.6% compared to July, when the price level remained unchanged. At the same time, the August price increase contrasts with the figures for the same month last year, when there was a 1.4% decline.
Ukraine’s public debt also changed in the second quarter of 2024. The total amount of state and state-guaranteed debt in hryvnia equivalent increased by UAH 243.7 billion, and in dollar equivalent by $1.1 billion. At the same time, the weighted average debt service rate decreased from 6.24% to 5.6% per annum, which indicates an increase in the efficiency of debt management.
“Effective public debt management, including lower interest rates, is an important step for Ukraine’s financial stability. This allows the country to focus on strategic investments in infrastructure and social development,” the expert added.
Global economy
At the global level, the International Monetary Fund (IMF) left unchanged its forecast for global economic growth in 2024 at 3.2%, but improved its expectations for 2025 to 3.3%. The main drivers of global growth remain emerging market countries, including China and India, whose economies are expected to grow by 5% and 7% respectively.
“The global economy continues to move forward, but faces key challenges, including inflation and high interest rates. Interestingly, the IMF has adjusted its expectations for oil prices – they are expected to rise slightly in 2024, but decline in 2025. This underscores the importance of the stability of commodity markets for developing countries,” said Maxim Urakin.
The European economy shows more modest results. According to IMF forecasts, the Eurozone’s GDP will grow by only 0.9% in 2024, while Germany’s economy will grow by only 0.2%.
“Europe is facing many challenges – from the energy crisis to the slowdown in industrial growth. For Ukraine, this is an opportunity to strengthen its position in trade relations with the EU by exporting competitive goods and services,” the expert emphasized.
Conclusion.
The economic indicators of Ukraine and the world in January-August 2024 show mixed results. Steady GDP growth and strengthened reserves are accompanied by inflationary risks and a negative trade balance. The global economy, while moving forward, is being held back by inflation and geopolitical factors.
“It is crucial for Ukraine to focus on creating an attractive investment climate, increasing labor productivity and developing export opportunities. This will be the key to sustainable economic growth and financial stability in the future,” summarized Maksym Urakin.
Maksym Urakin, Head of the Economic Monitoring project, PhD in Economics
More detailed analysis of Ukraine’s economic indicators is available in the monthly information and analytical products of Interfax-Ukraine Economic Monitoring.
