Ukraine GDP grew 2.1% yoy in 3Q17, state agency confirms

Ukraine’s 3Q17 GDP grew 2.1% yoy, with the State Statistics
Service having confirmed its previous estimate on its website on Dec. 19.

Ukraine’s private consumption slowed to 5.2% yoy
growth in 3Q17 (from 6.6% yoy in 2Q17). Government consumption grew 4.1% yoy
from a 7.8% yoy drop in the previous quarter. Investment in fixed assets eased
to 15.8% yoy growth from 23.7% yoy in 2Q17. Real exports surged to 13.2% yoy
growth from a 2.1% yoy drop in the previous quarter. Real imports slowed to
2.6% yoy growth from 4.6% yoy in 2Q17.

Ukraine’s central bank had projected 2.2% yoy GDP
growth for 2017, the IMF estimated 2.0% and we project 1.9%. Ukraine’s GDP has
grown 2.3% yoy in 9M17.

Alexander Paraschiy: The
structure of 3Q17 GDP growth provided surprises. Private consumption and investments
remain strong, despite slowing. However, unlike previously, we see strong
contributions of net exports (4.54pp) on the back of real exports surging amid
real imports easing.

Stronger net exports might result in a better
4Q17  GDP performance than we initially projected. However, in light of
the poor grain harvest (-6.0% as of Nov. 1), we still expect 1.5% yoy GDP
growth in the fourth quarter. For 2018, we anticipate GDP accelerating to 3.5%
yoy growth.