Ukraine trade deficit swells to USD 2.3 bln for 11M16

Ukraine’s goods trade deficit swelled to USD 2.3 bln in 11M16 compared to a USD 0.35 bln surplus in the same year-ago period (and a USD 2.1 bln deficit for 10M16), according to state statistics reported on Jan. 16. For 11M16, goods exports fell 5.9% yoy, reflecting declines of 30.1% yoy in chemicals, 15% yoy in minerals and 13% yoy in metals. Food oil exports increased 22% yoy through the reporting period.

Good imports were finally in black, rising 1.8% yoy in 11M16 on the back of non-energy imports (18.3% yoy). The main drivers were vehicles at 68% yoy growth, machinery at 26% yoy and chemicals added 11% yoy. Energy imports were still in red at a 33% yoy plunge for 11M16 due to falling gas prices and lower gas imports.

Exports to the EU gained momentum at 3.1% for 11M16. Exports to the CIS countries are still in red, falling 24.2% yoy.

Alexander Paraschiy: The November trade deficit was lower than we projected owing to better exports (+13.8% yoy, up from +0.3% yoy in October). Better export prices was the main source for improvement. Given this tendency, we estimate a 2016 trade deficit of USD 2.6 bln from USD 3.1 bln we estimated previously (according to UkrStat methodology).

For 2017 we are keeping our view of an expanding trade deficit. We expect some rollback in metal prices through the year, yet at the same time we project a steady expansion of imports. We project a USD 4.4 bln trade deficit in 2017 (according to UkrStat methodology).