You're reading: S&P: Ukraine’s GDP will increase by 4% in 2021

S&P Global Ratings, a U.S. credit rating agency, is expecting Ukraine’s economy to bounce back in 2021.

“We project real gross domestic product (GDP) growth in Ukraine of 4% in 2021, compared with a 4.2% contraction in 2020, following a gradual stabilization of the public health situation and a recovery in demand,” S&P’s March 13 statement reads.

In 2022, Ukraine’s economy is expected to grow by 3.5%.

S&P has also maintained Ukraine’s B/B rating with a stable outlook.

The agency’s report has maintained a positive viewpoint on Ukraine.

S&P predicts that Ukraine will receive a $700 million loan from the International Monetary Fund in 2021. The agency also points out the strong U.S. support for reforms in Ukraine.

“We view the recently imposed sanctions by the administration of President Joe Biden against oligarch Ihor Kolomoisky as a decisive renewal of Western support for President Volodymyr Zelensky’s reform program,” the S&P statement reads.

U.S. Secretary of State Antony Blinken called out billionaire Kolomoisky on March 5, accusing him of “involvement in significant corruption.”

Blinken made the public designation as the U.S. imposed a ban making Kolomoisky and his immediate family ineligible to travel in the United States.

Read More: US sanctions Kolomoisky for ‘significant corruption’

Concerning potential risks, the agency writes that the slow vaccination can hurt Ukraine’s post-COVID economic recovery.

However, not everyone shares the same optimism concerning Ukraine.

The IMF mission concluded on Feb. 13 that Ukraine needs to show more progress before it can get another tranche within the existing stand-by lending arrangement.

On March 4, Prime Minister Denys Shmyhal said that the IMF expects Ukraine to return criminal punishment for illicit enrichment and create transparent procedures to appoint the head of the National Anti-Corruption Bureau.

The IMF also expects Ukraine to reform the High Council of Justice, creating prerequisites for judicial reform.

However, Ukraine doesn’t seem to comply.

On March 3, Zelensky’s 245-member Servant of the People party supported in the first reading a bill that would revive the High Qualification Commission for judges.

The bill has been lambasted by anti-corruption activists and legal experts. According to them, without a proper judicial reform, creating a new judicial body with old judges will only legitimize and entrench the current corrupt system.