In 2025, the main factor behind Ukraine’s economic growth remained stable consumer demand, despite a decline in exports and challenges with energy supply at the end of the year. According to the National Bank’s estimates, the actual dynamics of real GDP aligned with the forecasts published in the Inflation Report for January 2026.
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Impact of Domestic Demand and Budget Expenditures on the Economy
The growth rate of real GDP slowed compared to 2024, when it was 3.2%. The reasons included a complicated security situation and ongoing attacks from the Russian Federation. At the same time, the economy continued to recover for the third consecutive year, thanks to high domestic demand, flexible fiscal policy, business adaptability, and the National Bank’s measures for macro-financial stability.
“On one hand, GDP growth is expected to have slowed compared to 2024 (3.2% according to revised data from the State Statistics Service) due to the ongoing complicated security situation and constant attacks from the Russians. On the other hand, despite the full-scale war, the economy has been recovering for the third consecutive year due to resilient domestic demand, a soft fiscal policy, significant business adaptability, and the efforts of the NBU to ensure macro-financial stability”
The largest positive contribution to GDP growth in 2025 came from private consumption — 4.7 percentage points. Household expenditures increased by 7.5%, and government consumption rose by 5.7%, adding another 2.1 percentage points to GDP growth. An increase in capital expenditures contributed to heightened investment activity, particularly in defense sector projects and agricultural processing. Gross fixed capital formation grew by 10.9% (2 percentage points contribution to GDP).
Export, Energy Issues, and Sector Dynamics
A significant reduction in physical export volumes occurred due to low agricultural product stocks, slow harvesting, and weak demand for products from the mining and metallurgical complex. The electricity deficit at the end of the year also limited exporters’ capabilities. As a result, the negative contribution of net exports to GDP change increased to 7.9 percentage points.
At the same time, imports of goods and services rose due to purchases of machinery and metallurgical products to support defense capabilities, as well as energy equipment for infrastructure restoration.
Growth in various sectors of the economy was uneven. Gross value added in trade increased by 4.2%, while in construction it rose by 11.6% due to the restoration of housing, logistics, and energy facilities. The public administration and defense sectors grew by 6.6%, and healthcare by 5.3%. In education, there was accelerated growth in gross value added (up to 12.7%) influenced by additional payments and increased scholarships.
In the summer, it was partially possible to restore the operation of the energy system, and the reduction in electricity production and distribution slowed to 1.8%. Meanwhile, the mining industry experienced a decline of 10.6% due to the loss of the Pokrovsk group, and at the end of the year, the situation was complicated by regular shelling and the electricity deficit.
In agriculture, gross value added decreased by 6.2% due to adverse weather conditions and slow harvesting rates, while livestock production continued to decline. The depletion of agricultural product stocks and lower yields of oilseeds led to a slowdown in the growth of the processing industry to 2.5%.
The National Bank forecasts that in 2026, the economic recovery will continue: a real GDP growth of 1.8% is expected due to increased harvests and further investments in reconstruction and defense projects. However, the main risk for economic development remains the course of the full-scale war, as well as potential difficulties with external financing and the situation in the Middle East.
According to official statistics, in 2025, Ukraine’s real GDP grew by 1.8%.