The analysis of key macroeconomic indicators of Ukraine and the global economy for January-September 2024 is based on official data from the State Statistics Service of Ukraine, the NBU, the IMF, the World Bank, and the UN, on the basis of which Maksim Urakin, PhD in Economics, founder of the Experts Club Information and Analytical Center, presented an analysis of macroeconomic trends in Ukraine and the world. The key aspects of the report include the dynamics of gross domestic product (GDP), inflation, unemployment, foreign trade and public debt of Ukraine, as well as global macroeconomic trends.
Macroeconomic indicators of Ukraine
In January-September 2024, Ukraine’s economy showed a slight growth. According to the Ministry of Economy, real GDP growth in July was 2.7% in annualized terms, which is better than June’s 1.1%, but worse than May’s 3.7%. In the third quarter of 2024, growth may exceed the previously forecasted 3.1%.
“The Ukrainian economy continues to move forward despite the difficult challenges caused by the war and external economic factors. Our key task remains to maintain stable growth and attract investment in strategic sectors of the economy,” – said Maksim Urakin, founder of the Experts Club information and analytical center.
However, rising inflation remains a challenge for the economy. In September, annual inflation reached 8.6%, accelerating from 7.5% in August. Consumer prices increased by 1.5% month-on-month, after 0.6% in August and zero in July. The National Bank of Ukraine has revised its inflation forecast for 2024, increasing it from 8.5% to 9.7%.
“Inflation remains one of the key challenges. High price growth rates significantly reduce the purchasing power of the population, which creates additional risks for the economy,” Urakin emphasized.
The negative balance of Ukraine’s foreign trade in goods increased by 5.9% over the first nine months of the year and reached $20.382 billion, indicating high imports and insufficient export growth.
“The increase in the negative trade balance signals the need to revise export support strategies. Only by developing the competitiveness of national production can we achieve balanced economic growth,” Urakin said.
Ukraine’s state budget revenues in September dropped to UAH 122.9 billion after a sharp increase in August to UAH 387.4 billion, driven by grants from the US and EU. This underscores the importance of external assistance to support the budget in times of war.
Ukraine’s international reserves decreased by 8.1% in September, reaching $38.9 billion. The main reason for this was a decline in international revenues amid debt repayments.
Global economic situation
The International Monetary Fund maintained its forecast for global economic growth at 3.2% in 2024. At the same time, the US economy grew by 2.8% in the third quarter amid a 3.7% increase in consumer spending. The European Union’s economy shows more modest results: the growth forecast for 2024 has been lowered to 0.9%, and in the Eurozone – to 0.8%.
“The global economy is facing a number of challenges, including a slowdown in China and high interest rates. However, the key problem remains the persistent price pressure and geopolitical instability,” emphasized Maksim Urakin.
The Chinese economy grew by 4.6% in the third quarter, but the growth forecast for 2024 was lowered to 4.8%. India continues to show stable growth at 7%, and Brazil has improved its performance to 3%.
“The global economy is now balancing between recovery and new risks. Forecasts for the coming years depend on the resolution of geopolitical conflicts and the ability of global leaders to stabilize the economy,” added Maksim Urakin.
The economic indicators of Ukraine and the world for the first nine months of 2024 show a contradictory picture. GDP growth and positive signals from global markets are combined with inflationary risks and an imbalance in foreign trade. The global economy is also under pressure from numerous uncertainties.
“It is important for Ukraine to focus on structural reforms that stimulate export growth and attract foreign investment. Only through the sustainable development of key industries can long-term economic stability be ensured,” – summarized Maksim Urakin.
Germany’s economy shows no signs of recovery: The country’s GDP will decline again in 2024, and stagnation is expected in 2025, according to a review by the Kiel Institute for the World Economy (IfW).
Experts expect Germany’s GDP to decline by 0.2% this year. The decline will be marked for the second year in a row – in 2023, the German economy shrank by 0.3%. In 2025, Germany’s GDP growth will be zero, analysts predict.
The autumn forecast predicted that the country’s GDP would decline by 0.1% in 2024 and grow by 0.5% in 2025.
The main reasons for the deterioration of the forecasts are the expected introduction of US tariffs and the deepening crisis in the German industry, IfW experts say.
“The crisis is largely a crisis of the manufacturing sector,” said Stefan Koots, head of the IfW’s economic forecasting department. – “It shows symptoms typical of the periods following major macro shocks.
“The German economy is struggling with a decline in competitiveness, which is reflected in the weakness of overall economic indicators, which hardly allow us to count on any upward impulses,” the expert added.
The growth rate of consumer prices in Germany will reach the European Central Bank’s (ECB) target of 2% only by the end of 2026, not 2025, as expected in the Institute’s previous forecast. The average inflation rate in 2024 and 2025 will be 2.2%, according to IfW.
Unemployment in Germany will be at 6% this year and 6.3% in 2025 and 2026, according to the IfW. This is worse than the fall forecast of 6.1% for 2025 and 5.9% for 2026.
Experts assume that Germany will be able to reduce the budget deficit from 2.6% of GDP in 2023 to 2.3% this year and 1.9% in 2025. In 2026, the budget deficit is projected at 2.1% of GDP. In the fall, IfW expected the budget deficit to be 1.7% in 2025 and 2026.
You can learn more about current trends in the global economy in the video analysis by Maksym Urakin and the Experts Cub think tank on the Experts Club YouTube channel: https://www.youtube.com/watch?v=grE5wjPaItI
Maksim Urakin, Founder of the Experts Club Information and Analytical Center, PhD in Economics, shared his observations on key indicators and risks for the Ukrainian and global economies as of November 2024.
Macroeconomic situation in Ukraine
According to Maksim Urakin, Ukraine’s economy continues to show slow growth.
“According to the National Bank, in October 2024, Ukraine’s GDP grew by 1.3% compared to October last year. This is worse than the September figures, but significantly better than the data for the summer months. However, there are negative trends in agriculture. This year’s harvest was significantly lower than last year’s, which hit the agricultural sector, one of the key drivers of the economy,” said Maksim Urakin.
The expert also pointed to a sharp deterioration in the foreign trade balance.
“The deficit of foreign trade in goods increased by almost 6% over the first nine months, reaching a frightening $20 billion. The main reasons for this were the growth of energy imports and the lack of labor at export-oriented enterprises,” Urakin added.
According to the expert, Ukraine’s national debt is also a cause for great concern.
“As of October 2024, the debt is already 6.4 trillion hryvnias, or about $155 billion. At the same time, international reserves have decreased by more than $2 billion and amount to $36 billion,” Urakin emphasized.
Global economy: challenges and prospects
At the global level, the key risks are associated with the growing debt burden.
“Global public debt already exceeds $100 trillion, which is 93% of global GDP. In the coming years, this figure will continue to grow, which puts additional pressure on the budgets of most countries,” Urakin said.
The economies of developed countries, according to the expert, show heterogeneous dynamics. The United States is showing steady growth, with its GDP increasing by almost 3% in the third quarter. At the same time, the eurozone economy is actually stagnating, and Germany has faced zero dynamics, the economist said.
At the same time, China continues to play a key role in the global economy. “In the third quarter, China’s GDP growth remained at 5%, but the pace slowed due to geopolitical tensions and internal problems, particularly in the construction sector,” said Maksim Urakin.
Looking to the future
Maksim Urakin expressed cautious optimism about the long-term prospects.
“The global economy is facing many challenges, including inflation, geopolitical conflicts and protectionism. However, despite all the difficulties, there are reasons to believe that growth will continue at least within moderate limits,” he concluded.
The expert also called for more active international coordination to overcome economic challenges.
“Stability requires joint efforts, and only through dialogue and cooperation will we be able to minimize risks,” summarized Maksim Urakin.
You can learn more about current trends in the global economy in the video on the Experts Club YouTube channel: https://www.youtube.com/watch?v=grE5wjPaItI
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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.
Currently, about 3.4 million children in Ukraine have limited access to water and sanitation, said Munir Mammadzadeh, UNICEF Representative in Ukraine.
“We know that about 3.4 million children have problems with access to water and sanitation, and the problem is especially acute in the frontline regions,” he said in an interview withInterfax-Ukraine.
That is why the supply of drinking water and hygiene kits is one of the key tasks for UNICEF. In addition, the UN Children’s Fund is working with water utilities on large-scale projects to restore infrastructure to make drinking water available. According to Mammadzadeh, even if children are not directly exposed to the risk of hostilities or attacks, the lack of normal life and anxiety also significantly affects their mental health.
UNICEF pays a lot of attention to the psychological problems of children and adolescents in the context of war.
“This is one of the areas where a lot of work is being done, as 1.5 million children in Ukraine today face problems such as depression, insomnia, and anxiety. We also know that during this thousand days, children have spent 2,800 to 4,800 hours in shelters while regular alarms sound – these estimates show the scale of the war’s impact on children: since the beginning of the war, they have spent an average of 4 to 6.5 months in shelters,” Mammadzadeh said.
He noted that a number of programs are already being organized to provide psychological assistance to children in Ukraine. For example, resilience centers in local communities already include mental health components as basic services. UNICEF also cooperates with Ukrainian universities to train good mental health professionals and works with school teachers and psychologists to help them recognize the elements of anxiety in children and provide basic assistance.
Since the beginning of Russia’s full-scale invasion of Ukraine, UNICEF has managed to mobilize more than $1 billion to help young Ukrainians, said Munir Mammadzadeh, head of the UN Children’s Fund (UNICEF) in Ukraine.
“We were in the country before the war, our mandate covered development and humanitarian issues. That is, we were already working and had a presence in the regions, which helped us to launch a full-fledged response to the full-scale war and attract additional resources to help children as much as possible. During this time, we have managed to mobilize more than $1 billion for Ukraine and neighboring countries where Ukrainians have started to move because of the war,” he said in an interview with Interfax-Ukraine.
According to Mammadzadeh, UNICEF’s request for humanitarian aid for Ukraine for this year is $496 million, and 70% of this amount has been funded, which shows the interest of donor countries in supporting Ukraine. He noted that it is often impossible to attract more than 50%.
In addition, in addition to humanitarian aid to the needy, UNICEF also has programmatic activities related to development, recovery and other areas. “We are now clearly distinguishing between what is humanitarian activity – saving lives – and what is part of our development work,” said Mammadzade.
According to him, next year UNICEF plans to reduce the humanitarian request by 20% compared to this year and increase plans and requests for systemic work, i.e. the development component of the mandate, which includes social protection issues.
