The World Bank says that Ukraine’s GDP will grow by 2% by the end of this year, as outlined in its “Global Economic Prospects” report.
Russia’s war in Ukraine has had a devastating impact on its economy, particularly affecting exports and overall economic stability. Since 2022, Ukraine’s GDP plummeted by nearly 30%, marking one of the most severe economic contractions in recent history. However, in 2023, the economy showed signs of resilience, with a real GDP growth rate estimated at 5.7%. Despite this recovery, the National Bank of Ukraine projects that it will take until 2030 for GDP to return to pre-war levels due to extensive damage to infrastructure and productive capacity.
“Ukraine’s growth is projected to moderate to 2 percent in 2025, assuming active hostilities continue throughout the year,” said the World Bank.
Furthermore, it anticipates a 7% economic recovery for Ukraine in 2026, contingent on the cessation of hostilities, along with investments in consumption and reconstruction.
“The outlook remains conditional on assumptions about the timing and quantity of external assistance receipts and the duration of Russia’s invasion,” the bank added.
The report also highlights that geopolitical tensions remain a critical risk factor.
“Geopolitical tensions continue to pose a critical risk. The invasion of Ukraine remains a significant factor in shaping the regional outlook. Any further escalation could lead to greater economic disruption across the region,” said the report.
Earlier, Ukraine’s central bank said it expects inflation to continue rising in early 2025 due to lower harvests, business energy costs, labor expenses, and the weakening hryvnia exchange rate.
The announcement comes after consumer prices in Ukraine rose by 1.4% month-over-month in December 2024, bringing annual inflation to 12% for the year.
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