February 2025 was a month that reflected the current challenges and prospects for the Ukrainian and global economies. Geopolitical tensions, inflationary pressures, and global changes in trade flows continue to affect economic development. Maksim Urakin, Founder of the Experts Club Information and Analytical Center, PhD in Economics, noted that Ukraine is showing signs of gradual economic recovery despite the difficult internal and external conditions.
Ukraine’s economy in February 2025
According to the National Bank, real GDP growth in January 2025 was 3.4% compared to the same period in 2024. The main drivers of growth were:
– Agriculture: the recovery in exports and the expansion of sales markets provided an increase of 6.5%.
– IT sector: IT services remained a key source of foreign exchange earnings, showing an increase of 10.4%.
– Construction: thanks to large-scale investments in infrastructure and international support, the sector grew by 4.2%.
“Amid the ongoing war and global turmoil, Ukraine’s economy is showing both signs of recovery and certain problems that need attention,” said Maksym Urakin, founder of Experts Club.
In January 2025, annual inflation was 12.9%, which is higher than in 2024 (12%). This is due to rising food and energy prices. At the same time, the hryvnia exchange rate remains relatively stable, fluctuating between UAH 39-40 per dollar, thanks to the support of international partners and export earnings.
“The decline in inflation is a positive signal for the economy, but an important task remains to increase the level of household incomes to compensate for the impact of past inflationary shocks,” Urakin emphasized.
In January 2025, Ukraine’s exports increased to $3.1 billion, driven by shipments of products and metals. However, imports also increased, mainly due to energy and equipment. The negative balance of foreign trade remains.
“Export dynamics show that Ukrainian companies are actively looking for new markets. Strengthening competitiveness and improving logistics could be the key to reducing the trade deficit,” Urakin said.
In January 2025, the state budget revenues of Ukraine amounted to UAH 282.8 billion, including UAH 128.2 billion for the general fund, which is 83.4% and 10.5% more than in January 2024, respectively. The main role in this was played by revenues from VAT and excise taxes, as well as international assistance. Ukraine’s international reserves increased to $40.1 billion, one of the highest levels in recent years.
“Financial support from international partners remains an important factor in macroeconomic stability. However, it is important to lay the foundation for independent economic growth now,” Urakin emphasized.
Global economic situation in February 2025
According to the IMF, global GDP is expected to grow by 2.9% in 2025, slightly lower than in 2024 (3%). The main reasons for the slowdown are the high cost of borrowing, uncertainty in the financial markets and a decline in global demand.
THE UNITED STATES: The economy is showing moderate growth at 2.3%, driven by robust domestic demand and investment in innovative industries.
European Union: The growth rate remains low at 1.1% due to the ongoing energy crisis and problems in the industry.
China: Growth slowed to 4.5%, due to the real estate crisis and a decline in exports.
India: Stable growth of 6.8%, remaining one of the fastest growing economies.
“The global economy is in a state of fragile balance. The main risks are related to geopolitical instability and high interest rates. However, countries with diversified economies are better able to cope with these challenges,” – Mr. Urakin said.
Oil: Oil prices in February 2025 are around $83 per barrel, having stabilized after the spikes of late 2024.
Gas: The European market continues to be under pressure, with an average gas price of €67 per MWh, due to persistent supply shortages.
Metals: Demand for steel and aluminum has declined, putting pressure on the export capacity of developing countries.
Central banks in major economies are keeping interest rates high to fight inflation. For example, the US Federal Reserve keeps its interest rate at 5.5%, which limits access to cheap capital but helps to reduce inflation.
Ukraine’s economy in February 2025 shows signs of stability and growth, but risks associated with inflation, foreign trade deficit, and dependence on international aid remain. The global economy is slowing down, which creates additional challenges for emerging market countries.
“It is important for Ukraine to continue attracting foreign investment, developing its export potential and strengthening its domestic market. Only systemic reforms and integration into the global economy will allow us to overcome the current difficulties and create the basis for long-term growth,” summarized Maksim Urakin.
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Ukraine’s economy demonstrates steady but uneven growth amid ongoing challenges caused by the war, inflationary risks, and global instability.
GDP growth
According to the Ministry of Economy, Ukraine’s real GDP increased by 3.1% year-on-year in January-October 2024. The growth rate slowed slightly compared to the first months of the year due to the impact of external economic factors and a decline in exports.
“The Ukrainian economy demonstrates strength and adaptability even in the face of large-scale challenges. However, for sustainable development, it is necessary to continue reforms aimed at improving the investment climate and supporting exports,” said Maksim Urakin, founder of Experts Club.
Inflation
Inflation continues to be one of the key issues. According to the National Bank of Ukraine, annual inflation was 9.1% in October, accelerating from 8.5% in September. The main factors behind the price increase were higher energy prices, hryvnia depreciation and high logistics costs.
“Inflation puts pressure on the consumer spending power of the population. It is important that the government pays more attention to tools to curb price growth, including support for national production and the development of the domestic market,” Urakin emphasized.
Foreign trade
The negative balance of Ukraine’s foreign trade in goods increased by 6.4% over ten months compared to the same period last year and amounted to $22.1 billion. Exports decreased by 4.8%, especially for agricultural products and metallurgy, while imports increased by 3.2%, mainly due to purchases of fuel and industrial equipment.
“Ukraine needs to develop export channels more actively, diversify its sales markets and support its producers. This will help to balance the trade deficit and strengthen its position in international markets,” Urakin added.
State budget and reserves
State budget revenues in January-October amounted to UAH 1.91 trillion, which is 12% higher than in the same period of 2023. However, a significant portion of the revenues was provided by international financial assistance. In October, Ukraine’s international reserves decreased by 6.7% to $37.2 billion, due to the repayment of external liabilities and a decrease in foreign exchange earnings.
Global economic situation
The global economy continues to face uncertainty caused by high interest rates, geopolitical conflicts, and the weakening of key economies.
According to the International Monetary Fund, global GDP will grow by 3.0% in 2024, which is in line with forecasts but below the average of recent decades.
USA – the economy grew by 2.5%, supported by high domestic consumption and investment.
Eurozone – growth was 0.8%, due to the recession in Germany and a slowdown in industrial production.
China – GDP grew by 4.6%, but the economy is facing problems in the real estate sector and a decline in exports.
India – remains one of the leaders of growth, showing a 6.9% economic recovery.
“The global economy is balancing between recovery and new challenges. In the coming months, geopolitical instability, energy price fluctuations and financial constraints due to high interest rates will remain the main risks,” – Mr. Urakin noted.
Global trends:
1. Financial markets remain volatile as central banks in leading countries are in no hurry to cut rates.
2. The energy crisis in Europe continues to put pressure on the economy.
3. Rising commodity prices, including oil and gas, are affecting inflationary processes around the world.
Ukraine’s economy has shown moderate growth in the first ten months of 2024, but faces challenges in the form of inflation, trade imbalance, and pressure on the state budget. The global economy remains exposed to risks associated with the high cost of borrowed funds and the slowdown in key countries.
“It is important for Ukraine to continue reforms aimed at supporting business and attracting investment. This is the only way to ensure long-term economic stability and create a solid foundation for future growth,” – summarized Maksim Urakin.
Economic development forecasts for the Netherlands for 2025 point to moderate growth, driven by domestic demand and investment.
According to the forecasts of the Central Planning Bureau of the Netherlands (CPB), after an expected modest economic growth of 0.6% in 2024, the country’s GDP could increase by 1.6% in 2025.
According to the Central Bank of the Netherlands (DNB), inflation in the country in 2025 is projected at around 3% per year, which is higher than the eurozone average.
In 2025, the Dutch government plans revenues of €425.1 billion and expenditures of €457 billion, which will lead to a budget deficit of about 2.5% of GDP, which is in line with European Union standards.
The Netherlands’ exports, which are a key driver of the economy, are expected to reach €70.5 billion in 2025.
According to forecasts, the growth of housing prices in the Netherlands will slow down from 13% in 2024 to 8-10% in 2025 and 6-8% in 2026.
Economic growth in the Netherlands may be at risk if trade conflicts escalate, especially between the United States and the European Union. The possible imposition of high import duties and retaliatory measures could negatively affect the country’s exports and investments.
In general, the outlook for the Dutch economy in 2025 remains positive, but the country should be prepared for possible external challenges and adapt its policies to the changing global economic situation.
Source: http://relocation.com.ua/forecast-economic-development-neder/
According to Swedbank, the Estonian economy will return to growth in 2025 after a 0.8% contraction in 2024. GDP growth is projected at 1.5%, and in 2026 the economy may accelerate to 2.5%.
The main growth factors are export recovery and increased investment.
At the same time, household consumption in Estonia will remain relatively weak due to higher taxes and slower growth in real incomes. Inflation will reach 4% in 2025, which is higher than the euro area average. This is mainly due to tax policy and additional household spending.
Despite economic challenges, the labor market in Estonia remains resilient. The employment rate exceeds 69%, which is one of the highest in Europe. However, the rapid growth of wages is outpacing productivity growth, which poses additional risks to the competitiveness of the economy.
According to Swedbank’s forecast, Lithuania’s economy will grow by 3% in 2025 and by 2.5% in 2026. In 2024, the country’s GDP has already increased by 2.4%, driven by manufacturing growth and retail development.
Factors supporting economic growth include accelerating industrial production, active retail development, and public investment.
However, Lithuania faces serious challenges. In particular, a significant increase in defense spending is needed, which could reach 4-5% of GDP. In addition, the country will have to carry out tax reform, which may affect business and consumer incomes.
Another challenge is the rapid growth of wages, especially in the public sector. This puts pressure on the competitiveness of Lithuanian companies, which are forced to adapt to changing conditions. Inflation is projected at 3% in 2025, and in 2026 it will decline to 2.7%.
According to Swedbank, the Latvian economy will show growth of 2.2% in 2025, and in 2026 the pace will accelerate to 2.8%. After a 0.2% decline in GDP in 2024, signs of recovery appeared by the end of the year, which creates positive expectations for the next period.
The main drivers of growth will be an increase in exports, growth in household consumption, and increased public investment.
The labor market in Latvia remains stable: the unemployment rate continues to decline, and wages are growing, although the rate of increase is slowing. Inflation in 2025 is projected at 2.6%, which is moderate.
One of the key challenges for the economy remains the implementation of projects funded by the EU’s Recovery and Resilience Facility (RRF). All planned projects are due to be completed by mid-2026, and their successful implementation could be a catalyst for further economic growth.
