Real GDP growth in Ukraine slowed to 2.6% in Dec 2023 - experts

MOSCOW. Jan 19 (Interfax) - Real GDP growth in Ukraine slowed to 2.6% in December 2023 from 3.5% in November, 6.4% in October and 11.1% in September primarily due to a 37.6% decrease in real gross value added (GVA) in agriculture because of the high harvesting results in December 2022, the Institute for Economic Research and Policy Consulting (IER) said.

"The result was worse than we expected. That is why, our estimate for the year is now worse than previously: real GDP grew 3.9% in the fourth quarter and 4.9% in the whole of 2023," Ukrainian media quoted IER leading expert Alexandra Betly as saying.

Ukraine's real GDP in December 2023 was almost 275 lower than in December 2021, i.e. before the onsite of the crisis, the institute said.

The performance of Ukraine's livestock breeding sector in December 2023 was poorer than even in December 2022, it said.

The processing industry saw a growth from 14% to 18%, above all due to the low base effect, IER said. Trade also increased, but the situation in the metals sector was dented by the stoppage of ferroalloy manufacturing plants.

Electricity production increased 8% in December 2023 year-on-year, it said.

The mining industry's output also grew 8% due to a rise in iron ore and natural gas production, whereas the production of construction materials fell and real GVA in the construction sector dropped 16% because of lower financing for infrastructure projects, the high base in December 2022 and the small volume of housing construction, IER said.

As reported, Ukraine's Economy Ministry projected GDP growth at 5% in 2023, down from 5.5% in January-November that year. Economic growth in Ukraine is expected at 4.6% in 2024.

The National Bank of Ukraine in late October upgraded its GDP growth forecast for 2023 from 2.9% to 4.9%, and from 3.5% to 3.6% for 2024. The bank, however, said it is highly likely that Ukraine's economy expanded by more than 5% in 2023.