The Ukrainian economy will grow by 1% in 2023 and by 3% in 2024, the European Bank for Reconstruction and Development expects.
The European Bank for Reconstruction and Development maintains its growth forecast for the Ukrainian economy in 2023 at 1% and 3% in 2024. This is stated in the EBRD report. Regional economic outlookreleased on Tuesday, May 16th.
It was noted that after an unprecedented fall in Ukraine’s GDP in 2022, estimated at 29.1%, output in real terms has stabilized at around 70% of the pre-war level.
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According to the EBRD, most businesses continue to operate, albeit with limited capacity, in a war of attrition concentrated in the east and southeast of the country. Manufacturers have to deal with frequent power outages, losses in fixed assets and infrastructure, logistical problems, shortage of skilled workers and occasional air raids.
“In these challenging circumstances, macroeconomic stability has been maintained thanks to clearer external financing schedules and the long-term IMF program approved in March 2023. External financing can be said to be sufficient to cover large gaps in external and fiscal financing and eliminate the need to finance the budget deficit by 2023”, said the forecast.
Inflation dropped to 21.3% year-on-year in March 2023 and is likely to continue to decline. Foreign exchange reserves are expected to remain at an adequate level, supporting the exchange rate peg.
The EBRD expects that the economy will grow by 1% in 2023 and 3% in 2024, provided that the war continues throughout this period with the same intensity as at the beginning of 2023. However, the forecast is weak with high losses of certainty and downside and upside risks depending on the dynamics of the war.
Remember, on the eve of the European Commission for the first time prepared an economic forecast for Ukraine. The Ukrainian economy is expected to grow by 0.6% this year and 4% in 2024.
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Source: korrespondent
I’m Liza Grey, an experienced news writer and author at the Buna Times. I specialize in writing about economic issues, with a focus on uncovering stories that have a positive impact on society. With over seven years of experience in the news industry, I am highly knowledgeable about current events and the ways in which they affect our daily lives.