Ukraine GDP declines 5.1% yoy in 3Q14
31 October 2014
Ukraine’s GDP declined 5.1% yoy, according to provisional estimates of the State Statistics Service released on Oct. 30. Based on the new figures, GDP declined 3.8% yoy in 9M14, we estimate.
Alexander Paraschiy: The provisional 3Q14 GDP result is a very positive surprise, considering it was generally expected that GDP would fall by at least 8% yoy in 2014. So even if GDP declines 10% yoy in 4Q14, hypothetically, the overall contraction through the year would be no more than -5.5% yoy (much better than even the initial government estimate of a 6.5% drop).
Yet even after such an impressive Ukrstat estimate, we are not rushing to revise our GDP forecast of a -7.8% yoy drop for 2014 because of remaining volatility in the economy. It will be very positive to see the slowing declines extended into 4Q14. However, we should keep in mind that the persistent military threat can break any positive trend quickly.
The impressive performance of agriculture (+46.9% yoy in September) was the main factor braking the fall for the quarter, which is a one-off effect related to a shift in harvesting of some late crops. In the coming months, the farming segment is not likely to positively contribute to GDP figures.
