Ukraine's Ministry of Economy estimates the economy grew by 5.3% in the first nine months of 2023 as the country switches from crisis to recovery, Interfax Ukraine reported on October 9.
The Ministry of Economy's forecasts suggest that Ukraine's recovery growth is set to continue, with a projected GDP growth of approximately 5% expected by the end of the year.
First Deputy Prime Minister and Minister of Economy Yulia Svyrydenko earlier estimated growth rates of around 4% fro the full year, but as the recovery gathers momentum the outlook is being revised upwards. Svyrydenko now says growth could be 5% not only this year but also next year.
Several key sectors of the Ukrainian economy are driving the bounce back. Agricultural remains a leading engine of growth and better than expected harvest have also been pushing inflation down.
The industrial sector, including mechanical engineering, food production, and furniture manufacturing, has experienced growth rates exceeding 10% according to the ministry.
Additionally, the construction industry has expanded due to ongoing restoration projects, and there has been renewed demand for mortgage programs, which are expected to stimulate the primary real estate market.
Svyrydenko emphasized that the Ukrainian budget, substantially supported by international assistance during the ongoing war, remains a critical contributor to economic growth. The government released Ukraine’s 2024 budget last week where half of the government’s revenues are to be supplied by its international partners.
The minister also highlighted the importance of bolstering support for businesses in the country. To this end, the budget for the upcoming year is expected to allocate more than UAH40bn ($1.1bn) for programs aimed at stimulating entrepreneurship development. These programs include affordable lending initiatives at rates of 5-7-9%, grant programs for budding entrepreneurs, and support for processing industries.
The budget will also allocate funds for the development of industrial parks and resources for humanitarian demining efforts. These initiatives are designed to provide compensation to farmers for demining services related to agricultural land, further supporting economic growth and development in Ukraine.