bne IntelliNews – Ukraine’s economy will contract by 4.2% this year, then experience an L-shaped recovery

Ukraine’s economy will contract by 4.2% this year and then experience an L-shaped recovery, down from October forecasts of 3.2% growth in 2020, according to estimates from the Ministry of Economic Development , Commerce and Agriculture, published on 17 April.

“According to experts, Ukraine will show a deeper decline than the global economy, which will be 4.2% in 2020. The nature of the recovery will be the same, the L-shape: the quarantine measures already adopted in Ukraine will be further strengthened and last until the end of the second quarter, which will have a more negative impact on the country’s economy, which will lead to a very slow recovery”, according to the forecast, quoted by Interfax Ukraine.

According to the report, in 2021 the Ukrainian economy will return to growth in 2021, when it will grow by 2.4%, the ministry said.

Experts have also worsened the inflation forecast this year from 6.3% to 7%, but next year they expect the figure to fall to 5.9%.

According to forecasts, the average annual exchange rate of the hryvnia against the US dollar will be 28.85 UAH/$.

“All elements of demand will have negative dynamics, but the biggest drop will be in investments – it will amount to 14.8%,” the forecast says.

The budget deficit will amount to 5.6% of GDP.

According to the consensus forecast, unemployment in Ukraine will reach 9.4% in 2020 and around 9.1% in 2021, the ministry said, Interfax reported.

The consensus forecasts were prepared on the basis of up-to-date expert assessments from the Ministry of Economy, Ministry of Finance, National Bank (NBU), as well as more than a dozen organizations and institutions. public and non-governmental enterprises.

Christi C. Elwood