Ukraine’s real gross domestic product (GDP) year-on-year growth in March 2024 was 4.9%, compared to 5.0% in February and 5.2% in January, according to the Institute for Economic Research and Policy Consulting (IEPC) Monthly Economic Monitor.
“Businesses faced restrictions on electricity supply as a result of Russian shelling of energy facilities. This has held back GDP growth. In April, we also expect GDP growth to slow down due to problems with access to electricity due to massive generation destruction,” said Alexandra Betlij, a leading researcher at the IEI.
The institute estimates that real gross value added (GVA) growth in the processing industry, slowed to almost 11% in March, down from 17% in January, while real GVA in electricity generation declined by 2% and is expected to fall further in April.
It is pointed out that real GVA in transportation continued to grow by more than 20%. Growth was also maintained in construction, particularly due to the construction of budget-financed fortifications, while growth in trade slowed to 4.6%.
Among the main macroeconomic trends last month, IED experts additionally highlighted the increase in transportation by Ukrzaliznytsia and through the Ukrainian Sea Corridor, which contributes to the development of a number of sectors of the economy, record external financing in the amount of $9 bln, a decrease in inflation to 3.2% and the discount rate to 14.5%, as well as the weakening of the hryvnia to 39 UAH/$1 on the background of restrained interventions by the NBU
It is also noted that the value of merchandise exports fell sharply in March this year compared to March last year amid continued decline in grain and iron ore prices.
As reported, after Ukraine’s GDP growth of 5.3% in 2023, the National Bank expects it to slow down this year to 3.6%, while the government – to 4.6%. According to the Ministry of Economy, GDP growth for January-February this year amounted to 3.6%, while the NBU in January forecast it in the first quarter at 7.1%.
