The National Bank of Ukraine (NBU) has estimated growth of real gross domestic product (GDP) of Ukraine in 2017 at 2.1%.
“The negative impact from stopping trade with government uncontrolled territories for real GDP in 2017 was lower than expected at the beginning of the year – 0.9 percentage points compared with 1.3 percentage points respectively,” the central bank said in an inflation report on Friday.
The NBU explains this by a more rapid reorientation of metallurgical enterprises to new sources of raw materials supplies amid the improvement of the external situation and the growth of domestic demand.
According to the report, in the fourth quarter, according to the estimates of the National Bank, GDP growth slowed to 1.5% against the same quarter of the previous year, while in the third quarter it was 1.5%.
“This, first of all, was due to a significant decline in crop production due to low yields of late grain crops and industrial crops,” the regulator said.
The NBU said that there was an increase in production in the processing industry, particularly in machine building, chemical and metallurgical production, which almost completely compensated for the further decline in output in the mining and power generation sectors, primarily reflecting the impact from the gap in the production and logistics ties with the government uncontrolled territories in Donbas at the beginning of the year.
As reported, the NBU late January raised its forecast for GDP growth in 2018 to 3.4% from 3.2%, while worsening the forecast for 2019 to 2.9% from 3.5%.
In 2016, the Ukrainian economy grew by 2.3% after a decline of 9.8% in 2015 and 6.6% in 2014. According to the State Statistics Service, in 2017, quarterly GDP growth gradually slowed down – from 2.5% in the first quarter to 2.3% in the second and 2.1% in the third. Data of the State Statistics Service for the fourth quarter and entire 2017 are not yet available.