Ukraine has entered the crisis in better macroeconomic condition than in previous crises due to prudent macroeconomic management over the past several years, and activity in Ukraine, the largest economy in the subregion, is projected to shrink in 2020, by 5.5%, the World Bank has said.
“Going forward, growth is expected to remain modest at 1.5% in 2021, rising to about 3.7% by 2023,” the World Bank said in the Europe and Central Asia Economic Update “COVID-19 and Human Capital.”
Compared to the June update, the forecast for the decline in Ukraine’s GDP was worsened by 2 percentage points, for 2021 – by 1.5 percentage points.
“The outlook depends on the duration of the health crisis and reforms to address bottlenecks to investment and safeguard macroeconomic sustainability,” the bank said.
The World Bank said that according to the negative scenario, Ukraine’s GDP growth next year may be even lower – only 1%.
The Ukrainian government predicts a 4.8% decline in the economy this year and a 4.6% growth next year.
The National Bank of Ukraine had expected a 6% decline this year, but it admits some improvement in its forecast to 5%. According to the central bank, next year the country’s GDP could grow by 4%.
