In 2024, Ukraine’s real gross domestic product (GDP) grew by 2.9%. Despite the fact that the economy has shown growth for the second consecutive year under the conditions of a full-scale war, the recovery rate has been lower than in 2023, when GDP increased by 5.5%.
This is reported by Finway
Reasons for the Slowdown in Economic Growth
The National Bank of Ukraine (NBU) pointed to several reasons for the slowdown in recovery rates. Among the main factors are:
- deterioration of the security situation;
- resumption of electricity shortages;
- low harvests.
At the end of last year, the gross added value (GAV) in agriculture decreased by 7.3%, while in the energy sector it fell by 2.7%.
Sectors with Positive Dynamics
Despite the overall slowdown, improvements are observed in some sectors in Ukraine. In particular, for the first time in years of war, the mining industry indicators increased by 3.6%. The manufacturing sector also showed growth of 6%, although the trade sector lost 4.1%. The financial sector demonstrated the highest growth at 27.4%. GAV in the IT sector grew by 8.3%, and in construction by 16.2%.
The NBU forecasts that GDP growth will continue in 2025. The main factors for positive dynamics will be improved harvests, reduced energy constraints, and a revival of external demand. However, the war will still hinder the recovery of the economy due to labor shortages, infrastructure destruction, and loss of production capacities.