Ukraine GDP increases 6% in 2Q21, ministry estimates

Ukraine’s real GDP increased around 6% yoy in 2Q21
after declining 2.2% yoy in 1Q21, according to estimates published on July 19
by the Ministry of Economic Development. In 5M21, GDP increased 0.7% yoy, the
ministry estimates.

The ministry notes that the economy is still
influenced by the pandemic, but the low comparative base of the previous year
and the vaccination campaign both globally and in Ukraine are prompting an
economic revival. The government expects that the accelerated growth in
agriculture and construction will help the economy to reach the forecasted GDP
growth of 4.1% yoy in 2021.

Evgeniya Akhtyrko: The growth
of 6% yoy in 2Q21 is not impressive at all given the fallout of 11.2% yoy in
2Q20. At the moment, we share the government’s expectation that the economy
might pick up in 2H21 amid accelerated growth in agriculture and construction.
In particular, agriculture will be driven by an increased grain crop, while the
growth in construction will be pushed by increased government spending for
large-scale infrastructure projects.

Like the government, we expect Ukraine’s GDP will
increase 4.1% yoy in 2021 (vs. 4.0% yoy decline in 2020).